Life Cycle Cost. Make/Model: 1978 Bombardier Learjet 24E with ( 2 ) CJ Acquisition: Purchase

Transcription

1 Life Cycle Cost Cost per Hour 8-Nov-12 John Smith Type of Operation: Corporate Make/Model: 1978 Bombardier Learjet 24E with ( 2 ) CJ 61-6 Acquisition: Purchase Program Length: 2 Years Currency: $ Exchange Rate: 1 / US$ Variable Cost (Average): Fixed Cost (Average): Salaries Fuel $ 2,912 Pilot/Cockpit Crew $ 47 Fuel Additives/Lubricants 21 Flight Attendants - CO2 Offset Cost - Maintenance Technicians - Maintenance Labor 91 Other - Maintenance Labor - Other - Benefits 141 Parts 637 Hangar 75 Parts - Other - Insurance Inspections 247 Hull 11 Engine Restoral - Liability 35 Engine Guaranteed Mx Plan 59 Miscellaneous Parts Guaranteed Mx Plan - Training Pilot/Maintenance 58 Airframe Guaranteed Mx Plan - Management Fee - Avionics Guaranteed Mx Plan - Annual Use Tax (Lease Only) - Component Overhaul (All) 75 Property Tax - Life Limited Components (All) 87 Registration Fee - Other Variable Cost - Brokerage Fee 1 ATC & Navigation Fees - New Int/Paint/Avionics - Landing & Parking Fees 19 Modernization 151 Crew Expenses 87 Nav/Weather Services 18 Small Supplies 4 Comp. Maintenance Service 13 Refurbishing 47 Other Fixed Cost - Total Direct Cost per Hour - 2 Year Average: $ 5,625 Total Fixed Cost per Hour - 2 Year Average: $ 1,19 Program Data: Other Costs (Average): Inflation - General % 3. Finance/Lease Cost $ - Inflation - Parts % 4. Aircraft Cash Payment/Resale 14 Program Length (Years) 2 Final Payment/Loan Payoff - Avg Utilization (Hours/Year) 4 Operations Overhead - Fuel Cost per Gallon $ 6.86 Administrative Overhead (G & A) - Maintenance Labor Cost per Hour $ 93. Maint. Labor Hours/Flight Hour (Ave) 9.78 Block Speed (Kts) 438 Total Annual Cost per Hour - 2 Year Average: $ 6,659 Costs shown exclude all taxes and depreciation Total Annual Cost per NM - 2 Year Average: $ Copyright 212, Conklin de Decker Associates, Inc. Orleans, MA (58)

2 Life Cycle Cost Life Cycle Cost Analysis For: John Smith 8-Nov-12 Aircraft: Registration: Bombardier Learjet 24E with ( 2 ) General Electric CJ 61-6 N123 Serial Number: 123 Year: 1978 Acquisition: Purchase Program length: 2 Years Currency: $ Inflation - Genral: Inflation - Parts 3% per Year 4% per Year Type of operation: Corporate Base of operation: Texas The following state taxes or fees are not included in the analysis but may be applicable. See the 'State Tax Guide for General Aviation' published by Conklin & de Decker for details. - Personal Property Tax - State Sales/Use Tax = 6.25% Copyright 212, Conklin and de Decker Associates, Inc. PO Box 1142, Orleans, MA 2653 (58)

3 Life Cycle Cost Executive Summary 8-Nov-12 For: John Smith Aircraft: Bombardier Learjet 24E 2 Years Per Hour Engines: ( 2 ) CJ 61-6 Cash Expenses 3 % Inflation Year: 1978 Acquisition $ (265,) Variable Cost (45,1,995) (5,625) Purchase price: $ 265, Fixed Cost (8,153,16) Overhead - Finance/Lease Cost - Depreciation: Straightline Acquisition: Purchase Income Charter Revenue $ - Resale Value - Adjusted 15,411 Program length: 2 Years Cash Flow Type of operation: Corporate Pre Tax $ (53,269,69) (6,659) After Tax ( % Tax Rate) (53,269,69) (6,659) Total flight hours: 8 Hours Negative Cash Flow 2 Years Copyright 212, Conklin and de Decker Associates, Inc. PO Box 1142, Orleans, MA 2653 (58)

4 Life Cycle Cost ANNUAL COST SUMMARY (Version Volume II, 212) John Smith Type of Operation: Corporate 8-Nov-12 Make/Model: 1978 Bombardier Learjet 24E with ( 2 ) CJ 61-6 Program Length: 2 Years Acquisition: Purchase Block Speed: Kts Currency: $ Exchange Rate: 1 / US$ Program Data: Acquisition Cost - Purchase: Avg Hrs/Year 4 Purchase Price $ 265, Cycles/Hour 1. State Sales Tax/VAT - Resale Value 56 % Training/Spares/Other - MX Labor Rate 93. /MH Refurb/Modification - Fuel Cost 6.86 /GAL Trade-in - Total $ 265, Airframe Status: Total Hours 11,9 Lease/Finance Payments: Total Cycles 11,9 Avg. Finance Cost/Yr $ - Year Manufactured: 1978 Final Payment - Lease Cost/Yr - Inflation - General: 3.% /Year Inflation - Parts 4.% /Year Insured Value: $ 265, Life Cycle Cost Total: Program Total Cost/Year Cost/Hour Cost/N. Mi. Owned Aircraft, Current Value $ - Total Acquisition Cost $ 265, Total Variable Cost $ 45,1,995 2,25,1 5, Total Fixed Cost $ 8,153,16 Resale Value (Adjusted) $ (15,411) Total Finance/Lease Cost $ - Ops + Admin Overhead $ - 47,655 Total Cost 53,269,69 2,663,485 6, Annual Budget: Year 1 $ 2,251,243 Year 11 $ 2,55,235 Starting: Year 2 2,132,857 Year 12 2,64,641 Year 3 1,868,424 Year 13 2,824,42 Year 4 1,95,412 Year 14 3,478,39 Year 5 2,1,55 Year 15 2,931,736 Year 6 2,113,3 Year 16 3,676,648 Year 7 2,255,932 Year 17 3,164,465 Year 8 2,255,965 Year 18 3,27,282 Year 9 2,344,235 Year 19 3,52,47 Year 1 2,422,99 Year 2 3,546, ,, 3,5, 3,, 2,5, 2,, 1,5, 1,, 5, - 2,, 1,8, 1,6, 1,4, 1,2, 1,, 8, 6, 4, 2, - Annual Operating Cost Budget Year Annual Maintenance Cost Year Copyright 212, Conklin and de Decker Associates, Inc. Orleans, MA 2653 (58)

5 Life Cycle Cost FINANCIAL ANALYSIS SUMMARY John Smith Type of Operation: Corporate Make/Model: 1978 Bombardier Learjet 24E 8-Nov-12 Program Length: 2 Years Acquisition: Purchase Currency: $ Financial Information: Depreciation: Capital Gains Tax:.% Corp Tax Rate:.% Method: Straightline Desired ROI:.% Term: 3 Interest Rate:.% Residual: 15 Inflation - General 3.% Inflation - Parts 4.% Ops Overhead: % + $ - /Yr Admin Overhead: % + $ - /Yr Revenue (incl. Fuel Surcharge: $ /Flt Hr + $ - /Mo Revenue Hours Hrs/Yr Avg Flight Hours Hrs/Yr 4 Resale Value (Adjusted) 15,411 Acquisition Cost: $ 265, - Cash Flow Analysis Expenses + Tax Impact + After Tax Revenue Depreciation Depreciation Cash Flow Cash Acquisition Cost $ - (265,) - (265,) 1 - (2,258,751) 7,58 (2,251,243) 2 - (2,14,365) 7,58 (2,132,857) 3 - (1,875,932) 7,58 (1,868,424) 4 - (1,957,921) 7,58 (1,95,412) 5 - (2,17,563) 7,58 (2,1,55) 6 - (2,12,538) 7,58 (2,113,3) 7 - (2,263,44) 7,58 (2,255,932) 8 - (2,263,473) 7,58 (2,255,965) 9 - (2,351,743) 7,58 (2,344,235) 1 - (2,43,418) 7,58 (2,422,99) 11 - (2,557,743) 7,58 (2,55,235) 12 - (2,612,149) 7,58 (2,64,641) 13 - (2,831,91) 7,58 (2,824,42) 14 - (3,485,898) 7,58 (3,478,39) 15 - (2,939,244) 7,58 (2,931,736) 16 - (3,684,157) 7,58 (3,676,648) 17 - (3,171,974) 7,58 (3,164,465) 18 - (3,277,791) 7,58 (3,27,282) 19 - (3,59,916) 7,58 (3,52,47) 2 15,411 (3,554,341) 7,58 (3,396,422) Total: $ 15,411 (53,57,267) 15,167 (53,269,69) NPV Analysis Total Acquisition Cost $ 265, $ - Investment: $ 265, (Version Volume II, 212) Present Value: $ (53,4,69) Net Present Value: $ (53,269,69) (5,) (1,,) (1,5,) (2,,) (2,5,) (3,,) (3,5,) (4,,) (1,,) (2,,) (3,,) (4,,) (5,,) (6,,) After Tax Cash Flow From Operations (Excludes Acquisition Cost of Aircraft) Year Cumulative Total Discounted Cash Flow Year Copyright 212, Conklin and de Decker Associates, Inc. Orleans, MA 2653 (58)

6 Life Cycle Cost ANNUAL COST (Page 1) 8-Nov-12 (Version Volume II, 212) John Smith Corporate Make/Model: 1978 Bombardier Learjet 24E with ( 2 ) CJ 61-6 Acquisition: Purchase Avg Utilization: 4 Hours/Year Aircraft Value:$ 265, Residual Value:$ 15,411 Currency: $ Exchange Rate 1 / US$ Inflation - General: 3% per Year Variable Cost Year Starting Nov Nov Nov Nov Nov Nov Nov Nov Nov - 22 Nov Nov Fuel $ 867,14 893, , ,58 975,933 1,5,211 1,35,368 1,66,429 1,98,421 1,131,374 1,165,315 Fuel Additives/Lubricants 6,32 6,51 6,75 6,96 7,113 7,327 7,546 7,773 8,6 8,246 8,494 CO2 Offset Cost Maintenance Labor 192,688 26,151 22, ,7 25, , ,517 31, , ,4 359,198 Maintenance Labor - Other Parts 12,686 13,372 14,64 151, ,47 175, ,174 21, , , ,798 Parts - Other Inspections 467,2 323, , Engine Restoral Engine Guaranteed Mx Plan 175, ,49 186, ,75 197,837 23,773 29, , , , ,228 Parts Guaranteed Mx Plan Airframe Guaranteed Mx Plan Avionics Guaranteed Mx Plan Component Overhaul (All) 37,5 25,462 11,352 27,285 16,61 33,828 34,651 17,55 26,792 18,945 44,13 Life Limited Components (All) 37,83 1,19 15,391 11,384 9,523 19,235 62,51 18,726 13,32 12,155 23,43 Other Variable Cost ATC & Navigation Fees Landing & Parking Fees 5,6 5,768 5,941 6,119 6,33 6,492 6,687 6,887 7,94 7,37 7,526 Crew Expenses 25,976 26,755 27,558 28,385 29,236 3,113 31,17 31,947 32,96 33,893 34,91 Small Supplies 11,88 12,236 12,63 12,982 13,371 13,772 14,185 14,611 15,49 15,51 15,966 Total Variable Cost $ 1,948,11 1,82,631 1,546,831 1,619,171 1,668,877 1,761,616 1,893,976 1,883,15 1,96,236 2,27,39 2,142,85 Fixed Cost Year Salaries Pilot/Cockpit Crew $ 14, 144,2 148, , , , , , , , ,148 Flight Attendants Maintenance Technicians Other Benefits 42, 43,26 44,558 45,895 47,271 48,69 5,15 51,655 53,24 54,8 56,444 Hangar 22,3 22,969 23,658 24,368 25,99 25,852 26,627 27,426 28,249 29,96 29,969 Insurance Hull 3,154 3,248 3,346 3,446 3,549 3,656 3,765 3,878 3,995 4,115 4,238 Liability 1,5 1,815 11,139 11,474 11,818 12,172 12,538 12,914 13,31 13,7 14,111 Miscellaneous Training Pilot/Maintenance 17,2 17,716 18,247 18,795 19,359 19,94 2,538 21,154 21,788 22,442 23,115 Management Fee Annual Use Tax (Lease Only) Property Tax Registration Fee Brokerage Fee New Int/Paint/Avionics Modernization 45, 46,35 47,741 49,173 5,648 52,167 53,732 55,344 57,5 58,715 6,476 Nav/Weather Services 5,279 5,437 5,6 5,769 5,942 6,12 6,33 6,493 6,687 6,888 7,95 Comp. Maintenance Service 3,75 3,863 3,978 4,98 4,221 4,347 4,478 4,612 4,75 4,893 5,4 Refurbishing 13,95 14,369 14,8 15,244 15,71 16,172 16,657 17,157 17,671 18,22 18,748 Other Fixed Cost Total Fixed Cost $ 33, , , , , , , , , ,519 47,385 Finance/Lease Cost $ Owned Aircraft - Current Value - Acquisition Cost/Resale 265, Final Payment/Loan Payoff Operations Overhead Administrative Overhead (G&A) Total Cost $ 2,516,243 2,132,857 1,868,424 1,95,412 2,1,55 2,113,3 2,255,932 2,255,965 2,344,235 2,422,99 2,55,235 Annual Utilization (Hrs) Cost/Flight Hour $ Variable 4,87 4,552 3,867 4,48 4,172 4,44 4,735 4,78 4,91 5,68 5,357 Variable + Fixed 5,628 5,332 4,671 4,876 5,25 5,283 5,64 5,64 5,861 6,57 6,376 Total Annual Cost 6,291 5,332 4,671 4,876 5,25 5,283 5,64 5,64 5,861 6,57 6,376 Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

7 Life Cycle Cost (Page 2) ANNUAL COST 1978 Bombardier Learjet 24E - Parts: 4% per Year Total Year Nov Nov Nov Nov Nov Nov Nov Nov - 23 Nov ,2,275 1,236,283 1,273,371 1,311,573 1,35,92 1,391,447 1,433,191 1,476,187 1,52,472 $ 23,299,49 Fuel 8,748 9,11 9,281 9,56 9,846 1,142 1,446 1,759 11,82 169,821 Fuel Additives/Lubricants CO2 Offset Cost 38,299 42, , ,49 474,512 5, ,67 556,67 586,385 7,277,461 Maintenance Labor Maintenance Labor - Other 264,92 282,977 32,75 322, , ,44 389, , ,277 5,94,974 Parts Parts - Other - 29,65 666, , ,19-1,974,569 Inspections Engine Restoral 243,315 25, , , , ,69 29, ,247 38,224 4,723,167 Engine Guaranteed Mx Plan Parts Guaranteed Mx Plan Airframe Guaranteed Mx Plan Avionics Guaranteed Mx Plan 14,811 56,275 2,956 31,991 35,132 39,668 17,685 49,45 43,347 62,26 Component Overhaul (All) 12,531 63,97 13,554 16, ,831 18,25 27,719 64,299 2, ,655 Life Limited Components (All) Other Variable Cost ATC & Navigation Fees 7,752 7,984 8,224 8,471 8,725 8,986 9,256 9,534 9,82 15,474 Landing & Parking Fees 35,957 37,36 38,147 39,291 4,47 41,684 42,934 44,222 45, ,985 Crew Expenses 16,445 16,938 17,446 17,97 18,59 19,64 19,636 2,225 2, ,22 Small Supplies 2,185,34 2,392,28 3,33,23 2,473,221 3,24,378 2,678,27 2,769,25 2,986,345 3,7,466 $ 45,1,995 Total Variable Cost Total Year Salaries 193, ,67 25, , , , , , ,491 $ 3,761,852 Pilot/Cockpit Crew Flight Attendants Maintenance Technicians Other 58,138 59,882 61,678 63,529 65,435 67,398 69,42 71,52 73,647 1,128,556 Benefits 3,868 31,794 32,748 33,731 34,743 35,785 36,859 37,964 39,13 599,29 Hangar Insurance 4,365 4,496 4,631 4,77 4,913 5,6 5,212 5,369 5,53 84,736 Hull 14,534 14,97 15,42 15,882 16,359 16,849 17,355 17,876 18, ,139 Liability Miscellaneous 23,89 24,523 25,259 26,17 26,797 27,61 28,429 29,282 3,16 462,17 Training Pilot/Maintenance Management Fee Annual Use Tax (Lease Only) Property Tax Registration Fee ,822 7,822 Brokerage Fee New Int/Paint/Avionics 62,291 64,159 66,84 68,67 7,19 72,212 74,378 76,69 78,98 1,29,167 Modernization 7,37 7,527 7,752 7,985 8,225 8,471 8,725 8,987 9, ,849 Nav/Weather Services 5,191 5,347 5,57 5,672 5,842 6,18 6,198 6,384 6,576 1,764 Comp. Maintenance Service 19,31 19,889 2,486 21,11 21,734 22,386 23,57 23,749 24, ,842 Refurbishing Other Fixed Cost 419,66 432, ,16 458, , ,439 51,32 516,63 539,367 $ 8,153,16 Total Fixed Cost $ - Finance/Lease Cost - Owned Aircraft - Current Value (15,411) 114,589 Acquisition Cost/Resale Final Payment/Loan Payoff Operations Overhead Administrative Overhead (G&A) 2,64,641 2,824,42 3,478,39 2,931,736 3,676,648 3,164,465 3,27,282 3,52,47 3,396,422 $ 53,269,69 Total Annual Cost Annual Utilization (Hrs) Cost/Flight Hour $ 5,463 5,981 7,583 6,183 8,11 6,695 6,923 7,466 7,519 Variable 6,512 7,61 8,696 7,329 9,192 7,911 8,176 8,756 8,867 Variable + Fixed 6,512 7,61 8,696 7,329 9,192 7,911 8,176 8,756 8,491 Total Annual Cost Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

8 Life Cycle Cost FINANCIAL ANALYSIS (Page 1) 8-Nov-12 (Version Volume II, 212) John Smith Corporate 2 Make/Model: 1978 Bombardier Learjet 24E Acquisition: Purchase Target ROI: % Avg Utilization: 4 Hours/Year Depreciation: Straightline Currency: $ Exchange Rate: 1 / US$ Inflation - General: 3% per Year - Parts: Year Starting Nov Nov Nov Nov Nov Nov Nov Nov Nov - 22 Nov Revenue: Sales (Flt Hr) $ Sales (Month) Aircraft Sale Total $ Cost Without Tax Impact: Total Acquisition Cost $ (265,) Principal Repayment Final Payment Total $ (265,) Cost With Tax Impact: Sales Tax/VAT $ Use Tax (Lease Only) Property Tax Variable Cost (1,948,11) (1,82,631) (1,546,831) (1,619,171) (1,668,877) (1,761,616) (1,893,976) (1,883,15) (1,96,236) (2,27,39) Fixed Cost (33,133) (312,226) (321,593) (331,241) (341,178) (351,414) (361,956) (372,815) (383,999) (395,519) Operations Overhead Admin Overhead (G&A) Betterment/Detriment (Lease Only) Depreciation (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) Interest Lease Payments Total $ (2,258,751) (2,14,365) (1,875,932) (1,957,921) (2,17,563) (2,12,538) (2,263,44) (2,263,473) (2,351,743) (2,43,418) Tax Impact: Income Tax Capital Gains Tax Total $ After Tax - Total Cash Flow: $ (265,) (2,251,243) (2,132,857) (1,868,424) (1,95,412) (2,1,55) (2,113,3) (2,255,932) (2,255,965) (2,344,235) (2,422,99) Operating Cash Flow: $ (2,251,243) (2,132,857) (1,868,424) (1,95,412) (2,1,55) (2,113,3) (2,255,932) (2,255,965) (2,344,235) (2,422,99) Present Value of Total Cash Flow: $ (2,251,243) (2,132,857) (1,868,424) (1,95,412) (2,1,55) (2,113,3) (2,255,932) (2,255,965) (2,344,235) (2,422,99) Value of Trade-in Aircraft: $ - Value of Owned Aircraft: $ - Net Present Value: $ (265,) (2,516,243) (4,649,1) (6,517,524) (8,467,936) (1,477,991) (12,591,21) (14,846,953) (17,12,917) (19,447,152) (21,87,61) Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA. (58)

9 Life Cycle Cost (Page 2) FINANCIAL ANALYSIS 1978 Bombardier Learjet 24E 4% per Year Total Year Nov Nov Nov Nov Nov Nov Nov Nov Nov - 23 Nov Revenues $ - Sales (Flt Hr) Sales (Month) ,411 15,411 Aircraft Sale ,411 $ 15,411 Total Cost Without Tax Impact: $ (265,) Total Acquisition Cost Principal Repayment Final Payment $ (265,) Total Cost With Tax Impact: $ - Sales Tax/VAT Use Tax (Lease Only) Property Tax (2,142,85) (2,185,34) (2,392,28) (3,33,23) (2,473,221) (3,24,378) (2,678,27) (2,769,25) (2,986,345) (3,7,466) (45,1,995) Variable Cost (47,385) (419,66) (432,194) (445,16) (458,515) (472,271) (486,439) (51,32) (516,63) (539,367) (8,153,16) Fixed Cost Operations Overhead Admin Overhead (G&A) Betterment/Detriment (Lease Only) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (7,58) (15,167) Depreciation Interest Lease Payments (2,557,743) (2,612,149) (2,831,91) (3,485,898) (2,939,244) (3,684,157) (3,171,974) (3,277,791) (3,59,916) (3,554,341) $ (53,35,267) Total Tax Impact: Income Tax Capital Gains Tax $ - Total After Tax - (2,55,235) (2,64,641) (2,824,42) (3,478,39) (2,931,736) (3,676,648) (3,164,465) (3,27,282) (3,52,47) (3,396,422) $ (53,269,69) Total Cash Flow (2,55,235) (2,64,641) (2,824,42) (3,478,39) (2,931,736) (3,676,648) (3,164,465) (3,27,282) (3,52,47) (3,546,833) $ (53,155,11) Operating Cash Flow (2,55,235) (2,64,641) (2,824,42) (3,478,39) (2,931,736) (3,676,648) (3,164,465) (3,27,282) (3,52,47) (3,396,422) $ (53,4,69) Present Value (24,42,296) (27,24,936) (29,849,338) (33,327,728) (36,259,464) (39,936,113) (43,1,578) (46,37,86) (49,873,268) (53,269,69) $ (53,269,69) Net Present Value Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA. (58)

10 Life Cycle Cost Maintenance Cost Matrix 8-Nov-12 For: John Smith Inflation: 3. %/Year Aircraft: Bombardier Learjet 24E Engines: ( 2 ) CJ 61-6 Program length: 2 Years Year: 1978 Type of operation: Corporate Currency $ Flight hours/year 4 Hours Average $/Hr Maint Cost Fuel & Other Total Variable Average $/Hr Maint Cost Fuel & Other Total Variable This Analysis 2,546 3,8 5,625 This Analysis 2,546 3,8 5,625 Matrix -- 5-Year Average Cost * Matrix -- Average Cost for Program Duration* Year 1-5 1,86 2,418 4,278 Year 1-5 1,86 2,418 4,278 Year 6-1 1,94 2,83 4,78 Year 1-1 1,882 2,611 4,493 Year ,757 3,25 6,7 Year ,174 2,824 4,998 Year ,356 3,768 7,124 Year 1-2 2,469 3,6 5,529 * No Warranty Available 4, 3,5 3, 2,5 2, 1,5 1, 5 265, 4. Program ( % ROI) 3 Maintenance Cost - 5 Year Average 3, 2,5 2, 1,5 1, 5 Maintenance Cost - Average for Program Duration Year 1-5 Year 6-1 Year Year 16-2 Year 1-5 Year 1-1 Year 1-15 Year 1-2 Copyright 212, Conklin and de Decker Associates, Inc. PO Box 1142, Orleans, MA 2653 (58)

11 Budget Analysis Operating Budget For: John Smith 8-Nov-12 Aircraft: Bombardier Learjet 24E Engine: ( 2 ) General Electric CJ 61-6 Registration: N123 Serial Number: 123 Year: 1978 Budget Year Start: Nov Currency: $ Inflation - General: Inflation - Parts: 3% per Year 4% per Year Type of operation: Corporate Base of operation: Texas The following state taxes or fees are not included in the analysis but may be applicable. See the 'State Tax Guide for General Aviation' published by Conklin & de Decker for details. - Personal Property Tax - State Sales/Use Tax = 6.25% Copyright 212, Conklin and de Decker Associates, Inc. PO Box 1142, Orleans, MA 2653 (58)

12 Budget Analysis BUDGET SUMMARY (Version Volume II, 212) John Smith Budget Year Starting Nov , Monthly Budget Bombardier Learjet 24E 1978 with ( 2 ) CJ , Registration Number: N123 8-Nov-12 4, Currency: $ Exchange Rate: 1 / US$ Program Data: Acquisition Cost - Purchase: Hrs/Month 33 Purchase Price $ 265, Cycles/Hour 1. State Sales Tax/VAT - Training/Spares/Other - MX Labor Rate 93. /MH Refurb/Modification - Fuel Cost 6.86 /GAL Trade-in - Total $ 265, Airframe Status: Total Hours 119 Lease/Finance Payments: Year Manufactured: 1978 Avg. Finance Cost/Yr $ - Total Cycles 119 Final Payment - Lease Cost/Yr - Inflation - General: 3.% /Year Inflation - Parts 4.% Insured Value: $ 265, Budget Total: Total for Year Average/Month Cost/Hour 2, - (2,) (4,) (6,) (8,) Month Revenue Expense Profit/Loss Revenue $ - Variable Cost $ 1,948,11 162,343 4,87 Fixed Cost $ 33,133 Total Finance/Lease Cost $ 25,261 Monthly Maintenance Budget Ops + Admin Overhead $ 6, Total Expenses $ 2,251, ,64 5,628 5, Operating Profit/(Loss) $ (2,251,243) (187,64) (5,628) Monthly Budget: Revenues Expenses Profit/(Loss) (No Depreciation) Nov 212 $ 415,11 (415,11) Dec ,51 (141,51) Jan ,75 (664,75) Feb ,51 (141,51) Mar ,51 (141,51) Apr ,54 (153,54) May ,11 (15,11) Jun ,51 (141,51) Jul ,51 (141,51) Aug ,51 (141,51) Sep ,51 (141,51) Oct ,16 (142,16) 4, 3, 2, 1, Month Maint. Exp. Copyright 212, Conklin and de Decker Associates, Inc. Orleans, MA 2653 (58)

13 Budget Analysis MONTHLY BUDGET Nov 212 through Oct 213 (Version Volume II, 212) 8-Nov-12 John Smith Corporate Make/Model: 1978 Bombardier Learjet 24E N123 First Year Utilization: 4 Hours Revenue Hrs: Hours/Yr Aircraft Value:$ 265, Acquisition: Purchase Inflation: 3% per Year Currency: $ Exchange Rate 1 / US$ Revenue Month Nov 212 Dec 212 Jan 213 Feb 213 Mar 213 Apr 213 May 213 Jun 213 Jul 213 Aug 213 Sep 213 Oct 213 Total Average Revenue/Charter Hours/Month - - Hourly Rev. (Incl. Fuel Surcharge $ - $ - Monthly Revenue - - Total Revenue - Variable Cost Month Nov 212 Dec 212 Jan 213 Feb 213 Mar 213 Apr 213 May 213 Jun 213 Jul 213 Aug 213 Sep 213 Oct 213 Total Average Flight Hours/Month Fuel $ 72,259 72,259 72,259 72,259 72,259 72,259 72,259 72,259 72,259 72,259 72,259 72,259 $ 867,14 Fuel Additives/Lubricants ,32 CO2 Offset Cost - - Maintenance Labor 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 192,688 Maintenance Labor - Other - - Parts 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 12,686 Parts - Other - - Inspections , ,2 Engine Restoral - - Engine Guaranteed Mx Plan 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14, ,776 Parts Guaranteed Mx Plan - - Airframe Guaranteed Mx Plan - - Avionics Guaranteed Mx Plan - - Component Overhaul (All) , , ,5 Life Limited Components (All) , , ,83 Other Variable Cost - - ATC & Navigation Fees - - Landing & Parking Fees ,6 Crew Expenses 2,165 2,165 2,165 2,165 2,165 2,165 2,165 2,165 2,165 2,165 2,165 2,165 25,976 Small Supplies ,88 Total Variable Cost $ 117, ,683 64, , , , , , , , , ,333 $ 1,948,11 Fixed Cost Month Nov 212 Dec 212 Jan 213 Feb 213 Mar 213 Apr 213 May 213 Jun 213 Jul 213 Aug 213 Sep 213 Oct 213 Total Salaries Pilot/Cockpit Crew $ 11,667 11,667 11,667 11,667 11,667 11,667 11,667 11,667 11,667 11,667 11,667 11,667 $ 14, Flight Attendants - - Maintenance Technicians - - Other - - Benefits 3,5 3,5 3,5 3,5 3,5 3,5 3,5 3,5 3,5 3,5 3,5 3,5 42, Hangar 1,858 1,858 1,858 1,858 1,858 1,858 1,858 1,858 1,858 1,858 1,858 1,858 22,3 Insurance Hull ,154 Liability ,5 Miscellaneous Training Pilot/Maintenance 8, , ,2 Management Fee - - Annual Use Tax (Lease Only) - - Property Tax - - Registration Fee - - Brokerage Fee - - New Int/Paint/Avionics - - Modernization 3,75 3,75 3,75 3,75 3,75 3,75 3,75 3,75 3,75 3,75 3,75 3,75 45, Nav/Weather Services ,279 Comp. Maintenance Service ,75 Refurbishing 1,163 1,163 1,163 1,163 1,163 1,163 1,163 1,163 1,163 1,163 1,163 1,163 13,95 Other Fixed Cost - - Total Fixed Cost $ 32,428 23,828 23,828 23,828 23,828 23,828 32,428 23,828 23,828 23,828 23,828 23,828 $ 33,133 Finance/Lease Cost $ - $ - Acquisition Cost/Residual Value 265, 265, Final/Balloon Payment - - Operations Overhead - - Administrative Overhead (G&A) - - Total Cost $ 415,11 141,51 664,75 141,51 141,51 153,54 15,11 141,51 141,51 141,51 141,51 142,16 $ 2,516,243 Operating Profit (Loss) $ (415,11) (141,51) (664,75) (141,51) (141,51) (153,54) (15,11) (141,51) (141,51) (141,51) (141,51) (142,16) $ (2,516,243) Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

14 Budget Analysis 12 Month Maintenance Budget - Inspections and Component Overhauls Nov 212 through Oct 213 (Version Volume II, 212) John Smith Corporate 8-Nov-12 At Start: Total Time 11, Bombardier Learjet 24E with ( 2 ) CJ 61-6 N123 Total Years 35 Currency: $ Exchange Rate: 1 / US$ First Yr Utilization: 4 Hrs Total Landings 11,9 Maintenance Cost Summary Month Nov 212 Dec 212 Jan 213 Feb 213 Mar 213 Apr 213 May 213 Jun 213 Jul 213 Aug 213 Sep 213 Oct 213 Total Maintenance Labor $ 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 16,57 $ 192,688 Maintenance Labor - Other - Parts 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 1,57 12,686 Parts - Other - Inspections 467,2 467,2 Engine Restoral - Engine Guaranteed Mx Plan 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14,648 14, ,776 Parts Guaranteed Mx Plan - Airframe Guaranteed Mx Plan - Avionics Guaranteed Mx Plan - Component Overhaul (All) 26,35 1, ,5 Life Limited Components (All) , , ,83 Total Maintenance Cost $ 41,276 41, ,516 41,276 41,276 53,36 41,276 41,276 41,276 41,276 41,276 41,926 $ 1,31,23 Inspections Month Nov 212 Dec 212 Jan 213 Feb 213 Mar 213 Apr 213 May 213 Jun 213 Jul 213 Aug 213 Sep 213 Oct 213 Total 1-24 Hour Yr/72 Hr 3-12 Hour Landing Total Inspection Cost $ 467,2 $ 467,2 Component Overhaul Month Nov 212 Dec 212 Jan 213 Feb 213 Mar 213 Apr 213 May 213 Jun 213 Jul 213 Aug 213 Sep 213 Oct 213 Total 1 - Stab Actuator T/R (D Howard) Generator (2) Main Wheel NDT (2) Nose Wheel NDT Brakes (2) Total Component Overhaul Cost $ 26,35 1,45 25 $ 37,5 Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

15 Budget Analysis 2 YEAR BUDGET FORECAST 8-Nov-12 (Version Volume II, 212) Page 1 John Smith Corporate Make/Model: 1978 Bombardier Learjet 24E with ( 2 ) CJ 61-6 Acquisition: Purchase Avg Utilization: 4 Hours/Year Aircraft Value:$ 265, Residual Value:$ 15,411 Currency: $ Exchange Rate 1 / US$ Inflation - General: 3% per Year Revenue Year Starting Nov Nov Nov Nov Nov Nov Nov Nov Nov - 22 Nov Nov Annual Charter/Revenue Hrs/Yr Hourly Revenue (Incl. Fuel Surcharge) Monthly Revenue Total Revenue Variable Cost Annual Utilization Fuel $ 867,14 893, , ,58 975,933 1,5,211 1,35,368 1,66,429 1,98,421 1,131,374 1,165,315 Fuel Additives/Lubricants 6,32 6,51 6,75 6,96 7,113 7,327 7,546 7,773 8,6 8,246 8,494 CO2 Offset Cost Maintenance Labor 192,688 26,151 22, ,7 25, , ,517 31, , ,4 359,198 Maintenance Labor - Other Parts 12,686 13,372 14,64 151, ,47 175, ,174 21, , , ,798 Parts - Other Inspections 467,2 323, , Engine Restoral Engine Guaranteed Mx Plan 175, ,49 186, ,75 197,837 23,773 29, , , , ,228 Parts Guaranteed Mx Plan Airframe Guaranteed Mx Plan Avionics Guaranteed Mx Plan Component Overhaul (All) 37,5 25,462 11,352 27,285 16,61 33,828 34,651 17,55 26,792 18,945 44,13 Life Limited Components (All) 37,83 1,19 15,391 11,384 9,523 19,235 62,51 18,726 13,32 12,155 23,43 Other Variable Cost ATC & Navigation Fees Landing & Parking Fees 5,6 5,768 5,941 6,119 6,33 6,492 6,687 6,887 7,94 7,37 7,526 Crew Expenses 25,976 26,755 27,558 28,385 29,236 3,113 31,17 31,947 32,96 33,893 34,91 Small Supplies 11,88 12,236 12,63 12,982 13,371 13,772 14,185 14,611 15,49 15,51 15,966 Total Variable Cost $ 1,948,11 1,82,631 1,546,831 1,619,171 1,668,877 1,761,616 1,893,976 1,883,15 1,96,236 2,27,39 2,142,85 Fixed Cost Year Starting Nov Nov Nov Nov Nov Nov Nov Nov Nov - 22 Nov Nov Salaries Pilot/Cockpit Crew $ 14, 144,2 148, , , , , , , , ,148 Flight Attendants Maintenance Technicians Other Benefits 42, 43,26 44,558 45,895 47,271 48,69 5,15 51,655 53,24 54,8 56,444 Hangar 22,3 22,969 23,658 24,368 25,99 25,852 26,627 27,426 28,249 29,96 29,969 Insurance Hull 3,154 3,248 3,346 3,446 3,549 3,656 3,765 3,878 3,995 4,115 4,238 Liability 1,5 1,815 11,139 11,474 11,818 12,172 12,538 12,914 13,31 13,7 14,111 Miscellaneous Training Pilot/Maintenance 17,2 17,716 18,247 18,795 19,359 19,94 2,538 21,154 21,788 22,442 23,115 Management Fee Annual Use Tax (Lease Only) Property Tax Registration Fee Brokerage Fee New Int/Paint/Avionics Modernization 45, 46,35 47,741 49,173 5,648 52,167 53,732 55,344 57,5 58,715 6,476 Nav/Weather Services 5,279 5,437 5,6 5,769 5,942 6,12 6,33 6,493 6,687 6,888 7,95 Comp. Maintenance Service 3,75 3,863 3,978 4,98 4,221 4,347 4,478 4,612 4,75 4,893 5,4 Refurbishing 13,95 14,369 14,8 15,244 15,71 16,172 16,657 17,157 17,671 18,22 18,748 Other Fixed Cost Total Fixed Cost $ 33, , , , , , , , , ,519 47,385 Finance/Lease Cost $ Acquisition Cost/Resale 265, Final/Balloon Payment Operations Overhead Administrative Overhead (G&A) Total Cost $ 2,516,243 2,132,857 1,868,424 1,95,412 2,1,55 2,113,3 2,255,932 2,255,965 2,344,235 2,422,99 2,55,235 Operating Profit (Loss) $ (2,516,243) (2,132,857) (1,868,424) (1,95,412) (2,1,55) (2,113,3) (2,255,932) (2,255,965) (2,344,235) (2,422,99) (2,55,235) Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

16 Budget Analysis Page 2 2 YEAR BUDGET FORECAST 1978 Bombardier Learjet 24E Corporate - Parts: 4% per Year Total Revenue Nov Nov Nov Nov Nov Nov Nov Nov - 23 Nov Annual Charter/Revenue Hrs/Yr Hourly Revenue (Incl. Fuel Surcharge) Monthly Revenue Variable Cost , 1,2,275 1,236,283 1,273,371 1,311,573 1,35,92 1,391,447 1,433,191 1,476,187 1,52,472 $ 23,299,49 Fuel 8,748 9,11 9,281 9,56 9,846 1,142 1,446 1,759 11,82 169,821 Fuel Additives/Lubricants CO2 Offset Cost 38,299 42, , ,49 474,512 5, ,67 556,67 586,385 7,277,461 Maintenance Labor Maintenance Labor - Other 264,92 282,977 32,75 322, , ,44 389, , ,277 5,94,974 Parts Parts - Other - 29,65 666, , ,19-1,974,569 Inspections Engine Restoral 243,315 25, , , , ,69 29, ,247 38,224 4,723,167 Engine Guaranteed Mx Plan Parts Guaranteed Mx Plan Airframe Guaranteed Mx Plan Avionics Guaranteed Mx Plan 14,811 56,275 2,956 31,991 35,132 39,668 17,685 49,45 43,347 62,26 Component Overhaul (All) 12,531 63,97 13,554 16, ,831 18,25 27,719 64,299 2, ,655 Life Limited Components (All) Other Variable Cost ATC & Navigation Fees 7,752 7,984 8,224 8,471 8,725 8,986 9,256 9,534 9,82 15,474 Landing & Parking Fees 35,957 37,36 38,147 39,291 4,47 41,684 42,934 44,222 45, ,985 Crew Expenses 16,445 16,938 17,446 17,97 18,59 19,64 19,636 2,225 2, ,22 Small Supplies 2,185,34 2,392,28 3,33,23 2,473,221 3,24,378 2,678,27 2,769,25 2,986,345 3,7,466 $ 45,1, Total Fixed Cost Nov Nov Nov Nov Nov Nov Nov Nov - 23 Nov Salaries 193, ,67 25, , , , , , ,491 $ 3,761,852 Pilot/Cockpit Crew Flight Attendants Maintenance Technicians Other 58,138 59,882 61,678 63,529 65,435 67,398 69,42 71,52 73,647 1,128,556 Benefits 3,868 31,794 32,748 33,731 34,743 35,785 36,859 37,964 39,13 599,29 Hangar - Insurance 4,365 4,496 4,631 4,77 4,913 5,6 5,212 5,369 5,53 84,736 Hull 14,534 14,97 15,42 15,882 16,359 16,849 17,355 17,876 18, ,139 Liability Miscellaneous 23,89 24,523 25,259 26,17 26,797 27,61 28,429 29,282 3,16 462,17 Training Pilot/Maintenance Management Fee Annual Use Tax (Lease Only) Property Tax Registration Fee ,822 7,822 Brokerage Fee New Int/Paint/Avionics 62,291 64,159 66,84 68,67 7,19 72,212 74,378 76,69 78,98 1,29,167 Modernization 7,37 7,527 7,752 7,985 8,225 8,471 8,725 8,987 9, ,849 Nav/Weather Services 5,191 5,347 5,57 5,672 5,842 6,18 6,198 6,384 6,576 1,764 Comp. Maintenance Service 19,31 19,889 2,486 21,11 21,734 22,386 23,57 23,749 24, ,842 Refurbishing Other Fixed Cost 419,66 432, ,16 458, , ,439 51,32 516,63 539,367 $ 8,153,16 Total Fixed Cost $ $ - Finance/Lease Cost (15,411) 114, Operations Overhead Administrative Overhead (G&A) 2,64,641 2,824,42 3,478,39 2,931,736 3,676,648 3,164,465 3,27,282 3,52,47 3,396,422 $ 53,269,69 Total Cost $ (2,64,641) (2,824,42) (3,478,39) (2,931,736) (3,676,648) (3,164,465) (3,27,282) (3,52,47) (3,396,422) $ (53,269,69) Operating Profit (Loss) $ Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

17 Budget Analysis 2 Year Maintenance Budget - Inspections and Component Overhauls (Page 1) 8-Nov-12 (Version Volume II, 212) John Smith Corporate Total Time 11,9 Make/Model: 1978 Bombardier Learjet 24E with ( 2 ) CJ 61-6 Avg Utilization: 4 Hrs/Yr Total Years 35 Currency: $ Exchange Rate: 1 / US$ Program Length: 2 Years Total Landings 11,9 Infl Maintenance Cost Summary Year Staring Nov Nov Nov Nov Nov Nov Nov Nov Nov - 22 Nov Maintenance Labor $ 192,688 26,151 22, ,7 25, , ,517 31, , ,4 Maintenance Labor - Other Parts 12,686 13,372 14,64 151, ,47 175, ,174 21, , ,618 Parts - Other Inspections 467,2 323,11 2,894 Engine Restoral Engine Guaranteed Mx Plan 175, ,49 186, ,75 197,837 23,773 29, , , ,348 Parts Guaranteed Mx Plan Airframe Guaranteed Mx Plan Avionics Guaranteed Mx Plan Component Overhaul (All) 37,5 25,462 11,352 27,285 16,61 33,828 34,651 17,55 26,792 18,945 Life Limited Components (All) 37,83 1,19 15,391 11,384 9,523 19,235 62,51 18,726 13,32 12,155 Total Maintenance Cost $ 1,31, , , , , , , , , ,7 1 Inspections Year Hour Yr/72 Hr Hour Landing Total Inspection Cost $ 467,2 323,11 2,894 Component Overhaul Year Stab Actuator T/R (D Howard) Generator (2) Main Wheel NDT (2) Nose Wheel NDT Brakes (2) Total Component Overhaul Cost $ 37,5 25,462 11,352 27,285 16,61 33,828 34,651 17,55 26,792 18,945 Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

18 Budget Analysis (Page 2) 2 Year Maintenance Budget - Inspections and Component Overhauls 1978 Bombardier Learjet 24E ation - General: 3% per Year - Parts: 4% per Year Total Year Nov Nov Nov Nov Nov Nov Nov Nov Nov - 23 Nov ,198 38,299 42, , ,49 474,512 5, ,67 556,67 586,385 $ 7,277,461 Maintenance Labor - Maintenance Labor - Other 247, ,92 282,977 32,75 322, , ,44 389, , ,277 5,94,974 Parts - Parts - Other 29,65 666, ,29 41,19 1,974,569 Inspections - Engine Restoral 236, ,315 25, , , , ,69 29, ,247 38,224 4,723,167 Engine Guaranteed Mx Plan - Parts Guaranteed Mx Plan - Airframe Guaranteed Mx Plan - Avionics Guaranteed Mx Plan 44,13 14,811 56,275 2,956 31,991 35,132 39,668 17,685 49,45 43,347 62,26 Component Overhaul (All) 23,43 12,531 63,97 13,554 16, ,831 18,25 27,719 64,299 2, ,655 Life Limited Components (All) 91, , ,84, ,686, ,86, ,775, ,26, ,253, ,425, ,399,711 2 $ 2,365,86 Total Variable Cost Total Inspections Hour Yr/72 Hr 1 12 Hour Landing 29,65 666, ,29 41,19 $ 1,974,569 Total Inspection Cost Total Component Overhaul Stab Actuator T/R (D Howard) Generator (2) Main Wheel NDT (2) Nose Wheel NDT Brakes (2) 44,13 14,811 56,275 2,956 31,991 35,132 39,668 17,685 49,45 43,347 $ 62,26 Total Component Overhaul Cost Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

19 Budget Analysis 2 Year Maintenance Budget - Life Limited Parts and Engine Overhauls (Page 1) 8-Nov-12 (Version Volume II, 212) (Page 2) 2 Year Maintenance Budget - Life Limited P John Smith Corporate Total Time 1978 Bombardier Learjet 24E 11,9 Make/Model: 1978 Bombardier 2 Total Years 35 Learjet 24E with ( ) CJ 61-6 Avg Utilization: 4 Hrs/Yr Currency: Exchange Rate: 1 / US$ Program Length: 2 Years Total Landings 11,9 $ Inflation - General: 3% per Year - Parts: 4% per Year Part Replacement Life Limited Year Total Starting Nov Nov Nov Nov Nov Nov Nov Nov Nov - 22 Nov Nov Nov Nov Nov Nov Nov Nov Nov Nov - 23 Nov Name 1 - NG Gear Strut Actuators 2 - MG Gear Strut Actuators Control Syst Cables Spoiler Ass'y Generator Bearing (2) Windshield (2) 7 - Main Tire (2) Nose Tire Total 37,83 1,19 15,391 11,384 19,235 62,51 18,726 13,32 12,155 23,43 12,531 63,97 13,554 16, ,831 18,25 27,719 64,299 2, ,655 Life Limited Part Cost $ 9,523 $ Engine Restoral Engine #1 Year Total Overhaul/Inspection 1 - H.S.I Overhaul Life Limited Parts Guaranteed Engine #1 Maintenenance Plan Cost $ 87,888 9,525 93,24 96,38 98,919 11,886 14,943 18,91 111, , , , ,37 129,66 132, , ,34 145, , ,112 $ 2,361,583 Engine Restoral Engine #2 Year Total Overhaul/Inspection 1 - H.S.I Overhaul Life Limited Parts Engine #2 Restoral Cost $ 87,888 9,525 93,24 96,38 98,919 11,886 14,943 18,91 111, , , , ,37 129,66 132, , ,34 145, , ,112 $ 2,361,583 Engine Restoral Year Total Overhaul/Inspection 1 - H.S.I 2 - Overhaul Life Limited Parts Engine #3 Restoral Cost $ 87,888 9,525 93,24 96,38 98,919 11,886 14,943 18,91 111, , , , ,37 129,66 132, , ,34 145, , ,112 $ 2,361,583 Engine Restoral Year Total Overhaul/Inspection 1 - H.S.I 2 - Overhaul Life Limited Parts Engine #4 Restoral Cost $ 87,888 9,525 93,24 96,38 98,919 11,886 14,943 18,91 111, , , , ,37 129,66 132, , ,34 145, , ,112 2,361,583 Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

20 Residual Value Analysis Residual Value Analysis For: John Smith 8-Nov-12 Aircraft: Registration Number: Bombardier Learjet 24E with ( 2 ) General Electric CJ 61-6 N123 Serial Number: 123 Year: 1978 Acquisition: Resale Value Adjustment Purchase Betterment & Detriment Program length: 2 Years Currency: $ Inflation - General: Inflation - Parts 3% per Year 4% per Year Type of operation: Corporate Base of operation: Texas The following state taxes or fees are not included in the analysis but may be applicable. See the 'State Tax Guide for General Aviation' published by Conklin & de Decker for details. - Personal Property Tax - State Sales/Use Tax = 6.25% Copyright 212, Conklin and de Decker Associates, Inc. PO Box 1142, Orleans, MA 2653 (58)

21 Residual Value Analysis Residual Value Summary For: John Smith 8-Nov-12 2-Year Residual Value Trend Adjusted Value Base Value Aircraft: Bombardier Learjet 24E with ( 2 ) CJ , Year: 1978 Purchase price: $ 265, Adjusted Residual Value in 232 (Calculation Basis - Betterment & Detriment) Program length: 2 Years Assumptions: Inflation 3.% Acquisition: Purchase Guaranteed Maint. Programs - Engine Yes - Parts/components No - Avionics No Type of operation: Corporate - Aircraft No Analysis: Avg Flight Hrs per Yr 4 Hours Base $ 148,697 Adjustments Today: Total Time 11,9 - Major Inspections (97,514) Total Cycles 11,9 - Component Overhaul 3,618 Age (Yrs) 35 - Life Limited Parts Replacement 95,69 In 232 Total Time 19,9 - Engine Restoral - Total Cycles 19,9 Adjusted Resale Value $ 15,411 Age (Yrs) 55 7, 6, 5, 4, 3, 2, 1, - (1,) (2,) (3,) Year Equity Analysis Adjusted Value Remaining Balance Heavy Maintenance Budget (Components/Engine/Major Inspections) Heavy Mx Budget 8, 12 7, 6, 1 5, 4, 8 3, 6 2, 1, (1,) 2 (2,) (3,) Year Year Copyright 212, Conklin and de Decker Associates, Inc. PO Box 1142, Orleans, MA 2653 (58)

22 Residual Value Analysis Residual Value Analysis - Inspections and Component Overhauls (Page 1) 8-Nov-12 (Version Volume II, 212) John Smith Corporate Total Time 11,9 Make/Model: 1978 Bombardier Learjet 24E with ( 2 ) CJ 61-6 Avg Utilization: 4 Hrs/Yr Total Years 35 Currency: $ Exchange Rate: 1 / US$ Program Length: 2 Years Total Landings 11,9 Program Assumptions: Year Starting Nov Nov Nov Nov Nov Nov Nov Nov Nov - 22 Inflation/Year 3.% Guaranteed Maint. Plan - Engine Yes - Parts/components No - Avionics No - Aircraft No Annual Utilization Residual Value Summary Base Aircraft $ 251,75 245, , , , ,45 28,84 25,327 21,416 Adjustments - Major Inspections 67, ,24 312, , , ,47 137,952 7,898 (5,49) - Component Overhaul 5,997 9,45 (2,64) 633 (7,976) 183 8,647 (522) (1,533) - Life Limited Parts Replacement 73,262 62,234 55,264 43,328 28,397 21,424 53,684 45,49 3,135 - Engine Restoral Net Residual Value $ 398,966 66,958 63, , , ,698 49,122 32, ,969 Adjustments - Inspections Year Hour 5,325 3, (2,165) (5,383) (9,5) 7,835 4, Yr/72 Hr (148,218) 137,62 118,246 95,475 69,38 38,671 4,94 (34,99) (78,89) 3-12 Hour 133, 132,37 13, ,6 124, , ,296 15,771 96, Landing 77,85 7,95 62,619 52,748 41,224 27,926 12,727 (4,57) (23,919) Total Inspection Betterment 216, ,24 312, , ,68 186,52 137,952 11,396 97,76 Total Inspection Detriment (148,218) - - (2,165) (5,383) (9,5) - (39,497) (12,89) Total Inspection Adjustment $ 67, ,24 312, , , ,47 137,952 7,898 (5,49) Adjustments - Component Overhaul Year Stab Actuator () 1,226 (1,263) () 1,339 (1,38) () 1,463 (1,58) 2 - T/R (D Howard) 5,437 3, (1,981) (4,76) (7,74) 6,493 3, Generator (2) 2,81 1,241 (426) (2,194) (4,67) 3,258 1,438 (494) (2,543) 4 - Main Wheel NDT (2) (12) 147 (65) 21 (23) (226) Nose Wheel NDT (44) (48) (53) 6 - Brakes (2) (2,273) 3,277 (1,447) 4,47 (512) 5, (5,32) 1, Total Component Overhaul Betterment 8,373 9, ,88 1,386 9,315 8,647 5,23 2,57 Total Component Overhaul Detriment (2,375) - (3,245) (4,174) (9,362) (9,132) () (5,752) (4,13) Total Component Overhaul Adjustment $ 5,997 9,45 (2,64) 633 (7,976) 183 8,647 (522) (1,533) Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

23 Residual Value Analysis (Page 2) Residual Value Analysis - Inspections and Component Overhauls Residual Value Calculation includes: 1978 Bombardier Learjet 24E Betterment & Detriment Program Assumptions: Nov Nov Nov Nov Nov Nov Nov Nov Nov Nov - 23 Nov Inflation/Year Guaranteed Maint. Plan - Engine - Parts/components - Aircraft Annual Utilization Residual Value Summary 197,86 192, ,79 181, , , , , , , ,697 Base Aircraft Adjustments (9,56) (186,122) (292,581) (38,951) 157,81 53,75 362, , ,552 47,248 (97,514) - Major Inspections (11,256) 2,94 (12,525) 12,98 1, ,9 5,56 (12,9) (1,227) 3,618 - Component Overhaul 12,746 4,56 (15,783) 7,767 (13,177) (32,995) 123,634 16,738 96, ,684 95,69 - Life Limited Parts Replacement - Engine Restoral 18,7 13,188 (133,81) (179,729) 32,23 188, ,667 53, ,55 314,95 15,411 Net Residual Value Inspections (3,123) (7,721) (12,845) 11,119 6,531 1,38 (4,371) (1,763) (17,836) 15,382 9,3 24 Hour (127,935) (182,471) (242,86) (39,486) 283, , , ,25 76,594 8,37 (68,12) 12 Yr/72 Hr 86,27 73,944 59,867 43,849 25,754 5,442 (17,239) (42,444) (7,341) (11,13) (134,915) 12 Hour (45,655) (69,875) (96,742) (126,432) (159,127) (195,21) 191, ,329 15, ,933 96,519 6 Landing 86,27 73,944 59,867 54, ,28 248,97 384,489 31, , ,351 15,521 (176,714) (26,66) (352,448) (435,918) (159,127) (195,21) (21,61) (53,27) (88,177) (11,13) (23,35) (9,56) (186,122) (292,581) (38,951) 157,81 53,75 362, , ,552 47,248 (97,514) Total Inspection Adjustment Component Overhaul () 1,599 (1,647) () 1,747 (1,8) () 1,91 (1,967) () 2,87 Stab Actuator (2,365) (5,684) (9,199) 7,752 4, (2,824) (6,787) (1,985) 9,257 5,297 T/R (D Howard) (4,715) 3,777 1,667 (573) (2,948) (5,466) 4,379 1,933 (664) (3,418) (6,336) Generator (2) (187) 137 (142) 24 (9) 278 (32) (313) 18 Main Wheel NDT (2) (58) (63) (69) Nose Wheel NDT (4,152) 3,54 (3,146) 4,536 (2,3) 6,187 (79) 8, (6,965) 2,391 Brakes (2) 163 8,623 1,667 12,671 6,245 7,38 4,573 12, ,47 9,955 (11,419) (5,684) (14,193) (573) (5,41) (7,329) (3,565) (6,787) (13,684) (1,696) (6,336) (11,256) 2,94 (12,525) 12,98 1, ,9 5,56 (12,9) (1,227) 3,618 Total Comp. Overhaul Adjustment Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)

24 Residual Value Analysis Residual Value Analysis - Life Limited Parts and Engine Overhauls (Page 1) 8-Nov-12 (Version Volume II, 212) John Smith Corporate Total Time 11,9 Make/Model: 1978 Bombardier Learjet 24E with ( 2 ) CJ 61-6 Avg Utilization: 4 Hrs/Yr Total Years 35 Currency: $ Exchange Rate: 1 / US$ Program Length: 2 Years Total Landings 11,9 Adjustments - Life Limited Part Replacement Year Starting Nov Nov Nov Nov Nov Nov Nov Nov Nov - 22 Name 1 - NG Gear Strut Actuators (4,738.2) (5,728.88) (6,774.93) (7,878.58) (9,42.36) (1,268.87) (11,56.84) (12,921.8) (14,352.53) 2 - MG Gear Strut Actuators ( 12, , , (.11) (4,592.19) (9,459.79) (14,615.32) (2,71.67) (25,842.24) 3 - Control Syst Cables 8, , ,25.43 (3,169.1) (7,616.5) (12,327.6) 1, , , Spoiler Ass'y 1, (495.2) (2,549.16) (4,726.1) (7,31.36) (9,47.68) 8,67.7 6, , Generator Bearing (2) 1, (1,254.6) 2, (.7) (2,741.81) 1, (1,454.43) 2,995.9 (.8) 6 - Windshield (2) 54,56. 55, , , , , , , , Main Tire (2) (359.15) (228.64) (8.9) (795.2) Nose Tire (7.74) (77.3) (84.47) Total Life Limited Parts Betterment 78, , , , , , , , , Total Life Limited Parts Detriment (5,97.17) (7,478.51) (9,623.46) (15,773.87) (31,14.67) (41,63.71) (27,63.59) (33,787.76) (4,279.32) Total Life Limited Parts Adjustment $ 73, , , , , , , , , Engine Restoral Engine #1 Year Overhaul/Inspection Adjustment 1 - H.S.I 12, (12,999.25) 26, (.69) (28,48.55) 14, (15,69.69) 31,41.24 (.8) 2 - Overhaul 12, (13,38.27) (41,121.17) (7,59.87) (11,791.74) (134,81.14) (169,699.48) 19, , Life Limited Parts Adjustment Engine Restoral Adjustment Covered by Engine Plan $ 25,539 (26,38) (14,345) (7,592) (13,2) (12,172) (184,769) 221,72 163,665 Copyright 212, Conklin and de Decker Associates, Inc., Orleans, MA (58)