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Consequently, we are subject to a variety of risks that are specific to international operations, including the following: ●military conflicts, civil strife, and political risks; ●export regulations that could erode profit margins or restrict exports; ●compliance with the U.S. Foreign Corrupt Practices Act, United Kingdom (“UK”) Bribery Act 2010, and other anti-bribery and anti-corruption laws; see Note 15 of Notes to Consolidated Financial Statements for information about certain pending proceedings; ●the burden and cost of compliance with foreign laws, treaties, and technical standards and changes in those regulations; ●contract award and funding delays; ●potential restrictions on transfers of funds; ●import and export duties and value added taxes; ●foreign exchange risk; ●transportation delays and interruptions, including the inability to move personnel out of foreign jurisdictions due to COVID-19 travel restrictions; ●uncertainties arising from foreign local business practices and cultural considerations; and ●changes in U.S. policies on trade relations and trade policy, including implementation of or changes in trade sanctions, tariffs, and embargoes.

The Company’s internal control over financial reporting is a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. GAAP and includes those policies and procedures that (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

4.3 Description of Capital Stock (filed herewith) 4.4 Rights Agreement, dated as of March 30, 2020, by and between AAR CORP. and Computershare Trust Company, N.A., as Rights Agent (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated March 30, 2020) 4.5 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank Index Exhibits National Association, as Trustee dated as of December 1, 2010 (incorporated by reference to Exhibit 4.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2010) 4.6 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010 (incorporated by reference to Exhibit 4.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2010) 4.7 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto, as amended on September 25, 2019 (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated September 27, 2019) Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Material Contracts 10.1* Amended and Restated AAR CORP. Stock Benefit Plan effective October 1, 2001 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2001), as amended June 27, 2003 (incorporated by reference to Exhibit 10.1 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2003), as amended May 5, 2005 (incorporated by reference to Exhibit 10.1 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2005), as amended July 12, 2005 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2006), as amended June 23, 2006 (incorporated by reference to Exhibit 10.1 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2007), as amended January 23, 2007 (incorporated by reference to Exhibit 10.1 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2007), as amended January 27, 2007 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended February 29, 2008), and as amend July 11, 2011 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended August 31, 2011) 10.2* AAR CORP. Directors’ Retirement Plan, dated April 14, 1992 (incorporated by reference to Exhibits to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 1992), amended May 26, 2000 (incorporated by reference to Exhibit 10.5 to the Registrant's Annual Report on Form 10-K for the fiscal year ended May 31, 2000) and April 10, 2001 (incorporated by reference to Exhibit 10.5 to the Registrant's Annual Report on Form 10-K for the fiscal year ended May 31, 2001) 10.3* AAR CORP.

Supplemental Key Employee Retirement Plan, as Amended and Restated effective July 13, 2020 (filed herewith) 10.4* AAR CORP. Nonemployee Directors’ Deferred Compensation Plan, as Amended and Restated effective July 10, 2017 (incorporated by reference to Exhibit 10.4 to the Registrant's Annual Report on Form 10-K for the fiscal year ended May 31, 2019) 10.5 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC (incorporated by reference to Exhibit 10.16 to the Index Exhibits Registrant’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2003) 10.6 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC (incorporated by reference to Exhibit 10.17 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2003) 10.7 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of December 19, 2014 (incorporated by reference to Exhibit 10.9 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2015) 10.8* Form of Non-Employee Director Non-Qualified Stock Option Agreement (incorporated by reference to Exhibit 10.13 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2012) 10.9* Form of Fiscal 2021 Director Restricted Stock Agreement (filed herewith) 10.10* Form of Split Dollar Insurance Agreement (incorporated by reference to Exhibit 10.24 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2006) 10.11* Form of Directors’ and Officers’ Indemnification Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended August 31, 2008) 10.12* Form of Policy for Recoupment of Incentive Compensation (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended August 31, 2012) 10.13* Section 162(m) Annual Cash Incentive Plan (incorporated by reference to Exhibit 10.23 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2015) 10.14* AAR CORP. 2013 Stock Plan (incorporated by reference to Exhibit 10.24 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2015) and as amended July 11, 2016 (incorporated by reference to Exhibit 10 to the Index Exhibits Registrant’s Current Report on Form 8-K dated October 11, 2016) 10.15* Form of Severance and Change in Control Agreement (filed herewith) 10.16 Credit Agreement among AAR CORP., as parent guarantor, AAR Canada Holdings ULC, as borrower, and Canadian Imperial Bank of Commerce, as lender, dated as of October 18, 2017 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated October 18, 2017) 10.17 Purchase Agreement dated February 23, 2018 by and among AAR CORP., as seller representative and servicer, the sellers time to time party thereto, and Citibank, N.A., as buyer (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated February 28, 2018) 10.18 First Amendment to Purchase Agreement dated as of May 22, 2018 by and among AAR CORP., as seller representative and servicer, the sellers time to time party thereto, and Citibank, N.A., as buyer (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated May 25, 2018) 10.19* Retirement Agreement dated May 24, 2018 between AAR CORP. and David P. Storch (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated May 25, 2018) 10.20* Post-Retirement Agreement dated May 24, 2018 between AAR CORP. and David P. Storch (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated May 25, 2018), as amended May 31, 2019 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated June 4, 2019) and July 11, 2019 (incorporated by reference to Exhibits to the Registrant’s Annual Report on Form 10-K for the fiscal year ended May 31, 2019).

10.21* Amended and Restated Employment Agreement dated as of May 24, 2018 between AAR CORP. and John M. Holmes (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K dated May 25, 2018) 10.22* Form of AAR CORP. Fiscal 2020 Short-Term Incentive Plan (incorporated by reference to Exhibit Index Exhibits 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended August 31, 2019) 10.23* Form of AAR CORP. Fiscal 2020 Non-Qualified Stock Option Agreement (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended August 31, 2019) 10.24* Form of AAR CORP. Fiscal 2020 Restricted Stock Agreement (incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended August 31, 2019) 10.25* Form of AAR CORP. Fiscal 2020 Performance Restricted Stock Agreement (incorporated by reference to Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended August 31, 2019) 10.26* Retirement Agreement and Supplemental Release between AAR CORP. and Robert J. Regan (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated October 11, 2019) 21.

The Company's internal control over financial reporting is a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. GAAP and includes those policies and procedures that (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

EXECUTIVE COMPENSATION The information required by this item is incorporated by reference to the information contained under the following captions: (a) "Executive Compensation-Compensation Committee Fiscal 2019 Report on Executive Compensation," (b) "Executive Compensation-Compensation Discussion and Analysis," (c) "Executive Compensation-Summary Compensation Table," (d) "Executive Compensation-Fiscal 2019 Grants of Plan-Based Awards," (e) "Executive Compensation-Outstanding Equity Awards at Fiscal 2019 Year End," (f) "Executive Compensation-Fiscal 2019 Option Exercises and Stock Vested," (g) "Executive Compensation-Retirement Plan," (h) "Executive Compensation-Non-Qualified Deferred Compensation (SKERP)," (i) "Executive Compensation-Tables of Potential Payments Upon a Termination of Employment or Change-in-Control of the Company," (j) "Director Compensation-Director Compensation Table," and (k) "Director Compensation-Compensation Committee Interlocks and Insider Participation" in our definitive proxy statement for the 2019 Annual Meeting of Stockholders.

4.3 Form of 2.25% Convertible Senior Note due 2016.12 4.4 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.12 4.5 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.17 4.6 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.17 Index Exhibits 4.7 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto,18 as amended August 26, 2011 and October 13, 2011,20 and as further amended on April 8, 2013 and April 24, 201321 and as further amended on March 24, 201527 and as further amended on November 1, 201629 and as further amended on February 28, 2018.31 4.8 Indenture dated as of February 14, 2014 governing $30,000,000 of 1.75% Convertible Senior Notes due 2016, by and between AAR CORP., as Issuer, and U.S. National Bank National Association, as Trustee.22 4.9 Form of 1.75% Convertible Senior Notes due 2016.25 4.10 Description of Common Stock (filed herewith) Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

4.3 Form of 2.25% Convertible Senior Note due 2016.12 4.4 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.12 4.5 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.17 4.6 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.17 Index Exhibits 4.7 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto,18 as amended August 26, 2011 and October 13, 2011,20 and as further amended on April 8, 2013 and April 24, 201321 and as further amended on March 24, 201527 and as further amended on November 1, 201629 and as further amended on February 28, 2018.31 4.8 Indenture dated as of February 14, 2013 governing $30,000,000 of 1.75% Convertible Senior Notes due 2015, by and between AAR CORP., as Issuer, and U.S. National Bank National Association, as Trustee.22 4.9 Form of 1.75% Convertible Senior Notes due 2015.25 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

10.10* Form of Split Dollar Insurance Agreement.9 10.11 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.11 10.12 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.11 10.13* Form of Directors' and Officers' Indemnification Agreement.15 10.14* Employment Agreement dated as of April 18, 2017 between Registrant and David P. Storch.16 10.15* Form of Policy for Recoupment of Incentive Compensation.23 10.16* Section 162(m) Annual Cash Incentive Plan.28 10.17* AAR CORP. 2013 Stock Plan.28 and as amended July 11, 2016.30 10.18* Amended and Restated Severance and Change in Control Agreement dated as of October 11, 2017 between AAR CORP. and Robert J. Regan.33 10.19* Severance and Change in Control Agreement dated as of October 11, 2017 between AAR CORP. and Michael D. Milligan.33 Index Exhibits 10.20 Credit Agreement among AAR CORP., as parent guarantor, AAR Canada Holdings ULC, as borrower, and Canadian Imperial Bank of Commerce, as lender, dated as of October 18, 2017.34 10.21 Purchase Agreement dated February 23, 2018 by and among AAR CORP., as seller representative and servicer, the sellers time to time party thereto, and Citibank, N.A., as buyer.35 10.22 First Amendment to Purchase Agreement dated as of May 22, 2018 by and among AAR CORP., as seller representative and servicer, the sellers time to time party thereto, and Citibank, N.A., as buyer.36 10.23* Retirement Agreement dated May 24, 2018 between AAR CORP. and David P. Storch.36 10.24* Post-Retirement Agreement dated May 24, 2018 between AAR CORP. and David P. Storch.36 10.25* Amended and Restated Employment Agreement dated as of May 24, 2018 between AAR CORP. and John M. Holmes.36 10.26* Form of AAR CORP. Fiscal 2018 Short-Term Incentive Plan.37 10.27* Form of AAR CORP. Fiscal 2018 Non-Qualified Stock Option Agreement.37 10.28* Form of AAR CORP. Fiscal 2018 Restricted Stock Agreement.37 10.29* Form of AAR CORP. Fiscal 2018 Performance Restricted Stock Agreement.37 21.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.13 4.4 Form of 2.25% Convertible Senior Note due 2016.15 4.5 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.15 4.6 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.23 4.7 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.23 4.8 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto,24 as amended August 26, 2011 and October 13, 2011, 26 and as further amended on April 8, 2013 and April 24, 201328 and as further amended on March 24, 201534 and as further amended on November 1, 2016.38 4.9 Loan Agreement dated as of March 9, 2012 between AAR Corp. and Development Bank of Japan, Inc.27 4.10 Indenture dated as of February 14, 2014 governing $30,000,000 of 1.75% Convertible Senior Notes due 2016, by and between AAR CORP., as Issuer, and U.S. National Bank National Association, as Trustee.29 4.11 Form of 1.75% Convertible Senior Notes due 2016.32 Index Exhibits Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Supplemental Key Employee Retirement Plan, as Amended and Restated effective January 1, 2005,10 as amended July 11, 2007,12 October 17, 2007,16 June 11, 2010,22 and further amended April 26, 2013 and November 18, 2014.36 10.4* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.3 10.5* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko2, as amended June 14, 2010.21 and as further amended September 22, 2016.40 10.6* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.11 10.7 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.6 10.8 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.6 10.9 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of December 19, 2015.36 10.10* Form of Non-Employee Director Non-Qualified Stock Option Agreement.31 Index Exhibits 10.11* Form of Fiscal 2018 Director Restricted Stock Agreement (filed herewith).

10.12* Form of Split Dollar Insurance Agreement.11 10.13 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.14 10.14 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.14 10.15* Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and Robert J. Regan).17 10.16* Form of Directors' and Officers' Indemnification Agreement.18 10.17* Employment Agreement dated as of April 18, 2017 between Registrant and David P. Storch.20 10.18* Form of Amendment to the Severance and Change in Control Agreement (applicable to Mr. Romenesko).19 10.19* Form of Amendment to the Severance and Change in Control Agreement (applicable to Mr. Regan).19 10.20* Form of Policy for Recoupment of Incentive Compensation.30 10.21* Section 162(m) Annual Cash Incentive Plan.36 10.22* AAR CORP. 2013 Stock Plan.36 and as amended July 11, 2016.39 10.23* AAR CORP. Fiscal 2016 Short-Term Incentive Plan.35 10.24* Form of Second Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko and Regan).37 10.25* Amended and Restated Employment Agreement dated as of April 18, 2017 between Registrant and John M. Holmes.20 Index Exhibits 10.26* Retirement and Consulting Agreement dated as of April 18, 2017 between Registrant and Timothy J. Romenesko.20 10.27* Agreement and Release dated as of July 27, 2016 between Registrant and Michael J. Sharp.41 21.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.13 4.4 Form of 2.25% Convertible Senior Note due 2016.15 4.5 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.15 4.6 Master Loan Agreement between EP Aviation, LLC and The Huntington National Bank dated as of April 23, 2010, together with the Guaranty dated April 23, 2010 made by AAR CORP. in favor of the Huntington Bank,20 as amended March 28, 2014.29 4.7 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.24 4.8 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.24 4.9 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto,25 as amended August 26, 2011 and October 13, 2011, 27 and as further amended on April 8, 2014 and April 24, 201430 and as further amended on March 24, 2016.36 4.10 Loan Agreement dated as of March 9, 2012 between AAR Corp. and Development Bank of Japan, Inc.28 Index Exhibits 4.11 Indenture dated as of February 14, 2014 governing $30,000,000 of 1.75% Convertible Senior Notes due 2016, by and between AAR CORP., as Issuer, and U.S. National Bank National Association, as Trustee.31 4.12 Form of 1.75% Convertible Senior Notes due 2016.34 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Supplemental Key Employee Retirement Plan, as Amended and Restated effective January 1, 2005,10 as amended July 11, 2007,12 October 17, 2007,16 June 11, 2010,23 and further amended April 26, 2013 and November 18, 2014.38 10.4* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.3 10.5* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko2, as amended June 14, 2010.22 10.6* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.11 10.7 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.6 10.8 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.6 Index Exhibits 10.9 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of December 19, 201538 10.10* Form of Non-Employee Director Non-Qualified Stock Option Agreement.33 10.11* Form of Fiscal 2017 Director Restricted Stock Agreement (filed herewith).

10.12* Form of Split Dollar Insurance Agreement.11 10.13 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.14 10.14 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.14 10.15* Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and Robert J. Regan).17 10.16* Form of Directors' and Officers' Indemnification Agreement.18 10.17* Amended and Restated Employment Agreement dated May 31, 2015 between Registrant and David P. Storch.21 10.18* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko and Sharp).19 10.19* Form of Amendment to the Severance and Change in Control Agreement (applicable to Mr. Regan).19 10.20* Form of Policy for Recoupment of Incentive Compensation.32 10.21* Section 162(m) Annual Cash Incentive Plan.38 10.22* AAR CORP. 2013 Stock Plan.38 10.23* AAR CORP. Fiscal 2016 Short-Term Incentive Plan.37 10.24* Form of Second Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko, Sharp and Regan).39 Index Exhibits 21.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.14 4.4 Loan Agreement dated July 15, 2005 between Registrant's Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.9 4.5 Form of 2.25% Convertible Senior Note due 2016.16 4.6 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.16 4.7 Master Loan Agreement between EP Aviation, LLC and The Huntington National Bank dated as of April 23, 2010, together with the Guaranty dated April 23, 2010 made by AAR CORP. in favor of the Huntington Bank,21 as amended March 28, 2013.31 4.8 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.25 Index Exhibits 4.9 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.25 4.10 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto,26 as amended August 26, 2011 and October 13, 2011, 28 and as further amended on April 8, 2013 and April 24, 201332 and as further amended on March 24, 2015.41 4.11 Indenture dated as of January 23, 2012, governing the 7.25% Senior Notes Due 2022, by and among AAR, certain subsidiary guarantees identified therein and U.S. Bank National Association, as trustee,29 as supplemented by the First Supplemental Indenture dated as of November 30, 2012.35 4.12 Loan Agreement dated as of March 9, 2012 between AAR Corp. and Development Bank of Japan, Inc.30 4.13 Form of 7.25% Senior Note due 2022.33,37 4.14 Indenture dated as of February 14, 2013 governing $30,000,000 of 1.75% Convertible Senior Notes due 2015, by and between AAR CORP., as Issuer, and U.S. National Bank National Association, as Trustee.34 4.15 Form of 1.75% Convertible Senior Notes due 2015.39 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

10.12* Form of Split Dollar Insurance Agreement.12 10.13 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.15 10.14 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.15 Index Exhibits 10.15* Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and Robert J. Regan).18 10.16 Form of Directors' and Officers' Indemnification Agreement.19 10.17* Amended and Restated Employment Agreement dated May 31, 2014 between Registrant and David P. Storch.22 10.18* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko and Sharp).20 10.19* Form of Amendment to the Severance and Change in Control Agreement (applicable to Mr. Regan).20 10.20* Form of Policy for Recoupment of Incentive Compensation.36 10.21* AAR CORP. Fiscal 2014 Short-Term Incentive Plan.39 10.22* Severance and Change in Control Agreement dated July 26, 2013 between the Registrant and John C. Fortson.40 10.23 Section 162(m) Annual Cash Incentive Plan (filed herewith).

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.17 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;1 First Supplemental Indenture thereto dated August 26, 1991;2 Second Supplemental Indenture thereto dated December 10, 1997.4 4.5 Loan Agreement dated July 15, 2005 between Registrant's Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.12 4.6 Form of 2.25% Convertible Senior Note due 2016.19 4.7 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.19 4.8 Master Loan Agreement between EP Aviation, LLC and The Huntington National Bank dated as of April 23, 2010, together with the Guaranty dated April 23, 2010 made by AAR CORP. in favor of the Huntington Bank, 25 as amended March 28, 2013.35 4.9 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.29 4.10 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.29 Index Exhibits 4.11 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto,30 as amended August 26, 2011 and October 13, 2011,32 and as further amended on April 8, 2013 and April 24, 2013.36 4.12 Indenture dated as of January 23, 2012, governing the 7.25% Senior Notes Due 2022, by and among AAR, certain subsidiary guarantees identified therein and U.S. Bank National Association, as trustee,33 as supplemented by the First Supplemental Indenture dated as of November 30, 2012.39 4.13 Loan Agreement dated as of March 9, 2012 between AAR Corp. and Development Bank of Japan, Inc.34 4.14 Form of 7.25% Senior Note due 2022.37,41 4.15 Indenture dated as of February 14, 2013 governing $30,000,000 of 1.75% Convertible Senior Notes due 2015, by and between AAR CORP., as Issuer, and U.S. National Bank National Association, as Trustee.38 4.16 Form of 1.75% Convertible Senior Notes due 2015.43 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Supplemental Key Employee Retirement Plan, as Amended and Restated effective January 1, 2005,14 as amended July 11, 2007,16 October 17, 200720 and June 11, 2010.28 Index Exhibits 10.4* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.6 10.5* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko5, as amended June 14, 2010.27 10.6* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.15 10.7 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.9 10.8 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.9 10.9 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 2005,11 May 19, 2006,15 May 16, 200824 and March 2, 2010.28 10.10* Form of Fiscal 2015 Non-Qualified Stock Option Agreement (filed herewith).

10.15* Form of Split Dollar Insurance Agreement.15 10.16 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.18 Index Exhibits 10.17 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.18 10.18* Severance and Change in Control Agreement dated as of July 9, 2008 (entered into between the Registrant and Robert J. Regan).21 10.19 Form of Directors' and Officers' Indemnification Agreement.22 10.20* Amended and Restated Employment Agreement dated May 31, 2014 between Registrant and David P. Storch.26 10.21* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko, Clark and Sharp).23 10.22* Form of Amendment to the Severance and Change in Control Agreement (applicable to Mr. Regan).23 10.23* Form of Policy for Recoupment of Incentive Compensation.40 10.24* AAR CORP. Fiscal 2014 Short-Term Incentive Plan.43 10.25* Severance and Change in Control Agreement dated July 26, 2013 between the Registrant and John C. Fortson.44 21.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.18 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;1 First Supplemental Indenture thereto dated August 26, 1991;2 Second Supplemental Indenture thereto dated December 10, 1997.4 4.5 Loan Agreement dated July 15, 2005 between Registrant's Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.12 4.6 Form of 1.625% Convertible Senior Note due 2014.21 4.7 Form of 2.25% Convertible Senior Note due 2016.21 4.8 Indenture for 1.625% Convertible Senior Notes due 2014 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.21 4.9 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.21 4.10 Master Loan Agreement between EP Aviation, LLC and The Huntington National Bank dated as of April 23, 2010, together with the Guaranty dated April 23, 2010 made by AAR CORP. in favor of the Huntington Bank,27 as amended March 28, 2013.37 4.11 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.31 4.12 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.31 4.13 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto,32 as amended August 26, 2011 and October 13, 2011,34 and as further amended on April 8, 2013 and April 24, 2013.38 Index Exhibits 4.14 Indenture dated as of January 23, 2012, governing the 7.25% Senior Notes Due 2022, by and among AAR, certain subsidiary guarantees identified therein and U.S. Bank National Association, as trustee,35 as supplemented by the First Supplemental Indenture dated as of November 30, 2012.41 4.15 Loan Agreement dated as of March 9, 2012 between AAR Corp. and Development Bank of Japan, Inc.36 4.16 Registration Rights Agreement, dated as of April 15, 2013, among AAR, the guarantors identified therein, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Securities, LLC and RBS Securities, Inc.39 4.17 Form of 7.25% Senior Note due 2022.39,43 4.18 Indenture dated as of February 14, 2013 governing $30,000,000 of 1.75% Convertible Senior Notes due 2015, by and between AAR CORP., as Issuer, and U.S. National Bank National Association, as Trustee.40 4.19 Form of 1.75% Convertible Senior Notes due 2015 (filed herewith).

Supplemental Key Employee Retirement Plan, as Amended and Restated effective January 1, 2005,15 as amended July 11, 2007,17 October 17, 200722 and June 11, 2010.30 10.4* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.6 10.5* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko5, as amended June 14, 2010.29 10.6* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.16 10.7 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.9 Index Exhibits 10.8 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.9 10.9 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 2005,11 May 19, 2006,16 May 16, 200826 and March 2, 2010.30 10.10* Form of Non-Qualified Stock Option Agreement (filed herewith).

10.15* Form of Split Dollar Insurance Agreement.16 10.16 Confirmation of OTC Convertible Note Hedge Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.20 10.17 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.20 10.18 Confirmation of OTC Warrant Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.20 10.19 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.20 10.20* Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and Robert J. Regan).23 10.21 Form of Directors' and Officers' Indemnification Agreement.24 10.22* Amended and Restated Employment Agreement dated May 31, 2010 between Registrant and David P. Storch.28 10.23* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko, Clark and Sharp).25 10.24* Form of Amendment to the Severance and Change in Control Agreement (applicable to Mr. Regan).25 10.25* Form of Policy for Recoupment of Incentive Compensation.42 Index Exhibits 10.26* AAR CORP.

We conduct our business activities primarily through seven principal operating subsidiaries: AAR Parts Trading, Inc.; AAR Aircraft & Engine Sales & Leasing, Inc.; AAR Services, Inc.; AAR Aircraft Services, Inc.; AAR Manufacturing, Inc.; AAR Airlift Group, Inc.; and AAR International, Inc. Our international business activities are conducted primarily through AAR International, Inc. We report our activities in four business segments: (i) Aviation Supply Chain, comprised primarily of business activities conducted through AAR Parts Trading, Inc.; AAR Allen Services, Inc. (a wholly-owned subsidiary of AAR Services, Inc.); AAR Aircraft & Engine Sales & Leasing, Inc. and AAR International, Inc.; (ii) Government and Defense Services, comprised primarily of business activities conducted through AAR Parts Trading, Inc. and AAR Airlift Group, Inc.; (iii) Maintenance, Repair and Overhaul, comprised primarily of business activities conducted through AAR Services, Inc; AAR Allen Services, Inc. and AAR Aircraft Services, Inc.; and (iv) Structures and Systems, comprised primarily of business activities conducted through AAR Manufacturing, Inc. Aviation Supply Chain Activities in our Aviation Supply Chain segment include the purchase, sale, lease, repair and overhaul of a wide variety of new, overhauled and repaired engine and airframe parts and components and avionics, electrical, electronic, fuel, hydraulic and pneumatic components and instruments for our airline customers.

Holders may convert their Convertible Notes based on a conversion rate of 28.6144 shares of our common stock per $1,000 principal amount of Convertible Notes, which is equivalent to a conversion price of $34.95 per share, only under the following circumstances: (i) during any calendar quarter beginning after March 31, 2008 (and only during such calendar quarter) if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 130% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of notes of the applicable series for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) if a designated event or similar change of control transaction occurs; (iv) upon specified corporate transactions; or (v) beginning on February 1, 2014, in the case of the 2014 notes, or February 1, 2016, in the case of the 2016 notes, and ending at the close of business on the business day immediately preceding the applicable maturity date.

A holder may convert the notes into shares of common stock based on a conversion rate of 34.5950 shares per $1,000 principal amount of notes, which is equivalent to a conversion price of approximately $28.91 per share, under the following circumstances: (i) during any calendar quarter beginning after March 31, 2006 (and only during such calendar quarter), if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 120% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the "trading price" per $1,000 principal amount of notes for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) upon a redemption notice; (iv) if a designated event or similar change of control transaction occurs; (v) upon specified corporate transactions; or (vi) during the ten trading day period ending at the close of business on the business day immediately preceding the stated maturity date on the notes.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.19 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;1 First Supplemental Indenture thereto dated August 26, 1991;2 Second Supplemental Indenture thereto dated December 10, 1997.4 4.5 Loan Agreement dated July 15, 2005 between Registrant's Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.12 4.6 Form of 1.75% Senior Convertible Note.14 4.7 Indenture between AAR CORP. and U.S. Bank, National Association, as trustee, dated February 1, 2006.14 4.8 Form of 1.625% Convertible Senior Note due 2014.22 4.9 Form of 2.25% Convertible Senior Note due 2016.22 4.10 Indenture for 1.625% Convertible Senior Notes due 2014 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.22 4.11 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.22 4.12 Master Loan Agreement between EP Aviation, LLC and The Huntington National Bank dated as of April 23, 2010, together with the Guaranty dated April 23, 2010 made by AAR CORP. in favor of the Huntington Bank.28 4.13 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.32 4.14 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.32 Index Exhibits 4.15 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto,33 as amended August 26, 2011 and October 13, 2011.35 4.16 Indenture dated as of January 23, 2012, governing the 7.25% Senior Notes Due 2022, by and among AAR, certain subsidiary guarantees identified therein and U.S. Bank National Association, as trustee.36 4.17 Form of 7.25% Note due 2022.36 4.18 Registration Rights Agreement, dated as of January 23, 2012, among AAR, the guarantors identified therein, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley Co. LLC, Wells Fargo Securities, LLC, Loop Capital Markets LLC, and U.S. Bancorp Investments, Inc.36 4.19 Loan Agreement dated as of March 9, 2012 between AAR Corp. and Development Bank of Japan Inc.37 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Supplemental Key Employee Retirement Plan, as Amended and Restated effective January 1, 2005,16 as amended July 11, 2007,18 October 17, 200723 and June 11, 2010.31 10.4* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.6 10.5* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko5, as amended June 14, 2010.30 10.6* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.17 10.7 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.9 Index Exhibits 10.8 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.9 10.9 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 2005,11 May 19, 2006,17 May 16, 200827 and March 2, 2010.31 10.10* Form of Non-Qualified Stock Option Agreement (filed herewith).

10.15* Form of Split Dollar Insurance Agreement.17 10.16 Confirmation of OTC Convertible Note Hedge Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.21 10.17 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.21 10.18 Confirmation of OTC Warrant Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.21 10.19 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.21 10.20* Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and each of Richard J. Poulton and Robert J. Regan).24 10.21 Form of Directors' and Officers' Indemnification Agreement.25 10.22* Amended and Restated Employment Agreement dated May 31, 2010 between Registrant and David P. Storch.29 10.23* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko, Clark and Sharp).26 10.24* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Poulton and Regan).26 Index Exhibits 10.25* Short-Term Incentive Plan for Senior Executives.31 21.

We conduct our business activities primarily through seven principal operating subsidiaries: AAR Parts Trading, Inc.; AAR Aircraft & Engine Sales & Leasing, Inc.; AAR Services, Inc.; AAR Aircraft Services, Inc.; AAR Manufacturing, Inc.; AAR Airlift Group, Inc.; and AAR International, Inc. Our international business activities are conducted primarily through AAR International, Inc. We report our activities in four business segments: (i) Aviation Supply Chain, comprised primarily of business activities conducted through AAR Parts Trading, Inc.; AAR Allen Services, Inc. (a wholly-owned subsidiary of AAR Services, Inc.); AAR Aircraft & Engine Sales & Leasing, Inc. and AAR International, Inc.; (ii) Government and Defense Services, comprised primarily of business activities conducted through AAR Parts Trading, Inc. and AAR Airlift Group, Inc.; (iii) Maintenance, Repair and Overhaul, comprised primarily of business activities conducted through AAR Services, Inc; AAR Allen Services, Inc. and AAR Aircraft Services, Inc.; and (iv) Structures and Systems, comprised primarily of business activities conducted through AAR Manufacturing, Inc. Aviation Supply Chain Activities in our Aviation Supply Chain segment include the purchase and sale of a wide variety of new, overhauled and repaired engine and airframe parts and components for our airline customers.

Holders may convert their Notes based on a conversion rate of 28.1116 shares of our common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of $35.57 per share, only under the following circumstances: (i) during any calendar quarter beginning after March 31, 2008 (and only during such calendar quarter) if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 130% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of notes of the applicable series for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) if a designated event or similar change of control transaction occurs; (iv) upon specified corporate transactions; or (v) beginning on February 1, 2014, in the case of the 2014 notes, or February 1, 2016, in the case of the 2016 notes, and ending at the close of business on the business day immediately preceding the applicable maturity date.

A holder may convert the notes into shares of common stock based on a conversion rate of 33.9789 shares per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $29.43 per share, under the following circumstances: (i) during any calendar quarter beginning after March 31, 2006 (and only during such calendar quarter), if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 120% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the "trading price" per $1,000 principal amount of notes for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) upon a redemption notice; (iv) if a designated event or similar change of control transaction occurs; (v) upon specified corporate transactions; or (vi) during the ten trading day period ending at the close of business on the business day immediately preceding the stated maturity date on the notes.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.20 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;1 First Supplemental Indenture thereto dated August 26, 1991;2 Second Supplemental Indenture thereto dated December 10, 1997.4 4.5 Loan Agreement dated July 15, 2005 between Registrant's Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.13 4.6 Form of 1.75% Senior Convertible Note.15 4.7 Indenture between AAR CORP. and U.S. Bank, National Association, as trustee, dated February 1, 2006.15 4.8 Form of 1.625% Convertible Senior Note due 2014.23 4.9 Form of 2.25% Convertible Senior Note due 2016.23 4.10 Indenture for 1.625% Convertible Senior Notes due 2014 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.23 4.11 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.23 4.12 Master Loan Agreement between EP Aviation, LLC and The Huntington National Bank dated as of April 23, 2010, together with the Guaranty dated April 23, 2010 made by AAR CORP. in favor of the Huntington Bank.29 4.13 Indenture providing for Issuance of Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.33 4.14 Indenture providing for Issuance of Subordinated Debt Securities between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated as of December 1, 2010.33 Index Exhibits 4.15 Credit Agreement dated April 12, 2011 among AAR CORP., Bank of America National Association, as administrative agent, and the various financial institutions party thereto.34 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Supplemental Key Employee Retirement Plan, as Amended and Restated effective January 1, 2005,17 as amended July 11, 2007,19 October 17, 200724 and June 11, 2010.32 10.4* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.6 10.5* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko5, as amended June 14, 2010.31 10.6* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.18 10.7* Severance and Change in Control Agreement dated January 14, 2000 between the Registrant and James J. Clark.8 10.8 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.10 10.9 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.10 10.10 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 2005,12 May 19, 2006,18 May 16, 200828 and March 2, 2010.32 10.11* Form of Non-Qualified Stock Option Agreement (filed herewith).

10.16* Form of Split Dollar Insurance Agreement.18 10.17 Confirmation of OTC Convertible Note Hedge Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.22 10.18 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.22 10.19 Confirmation of OTC Warrant Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.22 10.20 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.22 10.21* Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and each of Richard J. Poulton and Robert J. Regan).25 10.22 Form of Directors' and Officers' Indemnification Agreement.26 10.23* Amended and Restated Employment Agreement dated May 31, 2010 between Registrant and David P. Storch.30 10.24* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko, Clark and Sharp).27 10.25* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Poulton and Regan).27 10.26* Short-Term Incentive Plan for Senior Executives.32 21.

Holders may convert their Notes based on a conversion rate of 28.1116 shares of our common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of $35.57 per share, only under the following circumstances: (i) during any calendar quarter beginning after March 31, 2008 (and only during such calendar quarter) if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on AAR CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Financing Arrangements (Continued) the last trading day of such preceding calendar quarter is more than 130% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of notes of the applicable series for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) if a designated event or similar change of control transaction occurs; (iv) upon specified corporate transactions; or (v) beginning on February 1, 2014, in the case of the 2014 notes, or February 1, 2016, in the case of the 2016 notes, and ending at the close of business on the business day immediately preceding the applicable maturity date.

A holder may convert the notes into shares of common stock based on a conversion rate of 33.9789 shares per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $29.43 per share, under the following circumstances: (i) during any calendar quarter beginning after March 31, 2006 (and only during such calendar quarter), if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more AAR CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Financing Arrangements (Continued) than 120% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the "trading price" per $1,000 principal amount of notes for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) upon a redemption notice; (iv) if a designated event or similar change of control transaction occurs; (v) upon specified corporate transactions; or (vi) during the ten trading day period ending at the close of business on the business day immediately preceding the stated maturity date on the notes.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.25 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;1 First Supplemental Indenture thereto dated August 26, 1991;2 Second Supplemental Indenture thereto dated December 10, 1997.5 4.5 Note Purchase Agreement dated May 1, 2001 between Registrant and various purchasers, relating to the issuance of debt securities to institutional investors.7 4.6 Form of 2.875% Senior Convertible Note.12 4.7 Indenture between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated February 3, 2004.12 4.8 Loan Agreement dated July 15, 2005 between Registrant's Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.16 4.9 Form of 1.75% Senior Convertible Note.19 4.10 Indenture between AAR CORP. and U.S. Bank, National Association, as trustee, dated February 1, 2006.19 4.11 Credit Agreement dated August 31, 2006 among AAR CORP., Bank of America National Association (as successor by merger to LaSalle Bank National Association), as administrative agent, and the various financial institutions party thereto,22 as amended August 31, 2007,26 March 14, 200829 and April 7, 2010 (filed herewith).

10.4* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.7 10.5* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko.6 10.6* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.23 10.7* Severance and Change in Control Agreement dated January 14, 2000 between the Registrant and James J. Clark.9 10.8 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.11 10.9 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.11 10.10 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 2005,15 May 19, 2006,23 May 16, 200835 and March 2, 2010 (filed herewith).

10.16* Form of Split Dollar Insurance Agreement.23 10.17 Confirmation of OTC Convertible Note Hedge Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.27 10.18 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.27 10.19 Confirmation of OTC Warrant Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.27 10.20 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.27 10.21* Amended and Restated Letter Agreement dated as of June 5, 2008 between AAR CORP. and Howard A. Pulsifer.27 10.22* Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and each of Richard J. Poulton and Robert J. Regan).32 10.23 Form of Directors' and Officers' Indemnification Agreement.33 10.24* Amended and Restated Employment Agreement dated May 31, 2010 between Registrant and David P. Storch.37 10.25* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko, Clark and Sharp).34 10.26* Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Poulton and Regan).34 10.27* Second Agreement to Amended and Restated Change in Control Agreement between the Registrant and Timothy J. Romensko.38 10.28* Short-Term Incentive Plan for Senior Executives (filed herewith).

We conduct our business activities primarily through six principal operating subsidiaries: AAR Parts Trading, Inc., AAR Aircraft & Engine Sales & Leasing, Inc., AAR Services, Inc., AAR Aircraft Services, Inc., AAR Manufacturing, Inc., and AAR International, Inc. Our international business activities are conducted primarily through AAR International, Inc. We report our activities in four business segments: (i) Aviation Supply Chain, comprised primarily of business activities conducted through AAR Parts Trading, Inc., AAR Services, Inc., AAR Allen Services, Inc., (a wholly-owned subsidiary of AAR Parts Trading, Inc. and AAR Services, Inc.), and AAR International, Inc., (ii) Maintenance, Repair and Overhaul, comprised primarily of business activities conducted through AAR Services, Inc., AAR Allen Services, Inc. and AAR Aircraft Services, Inc. (iii) Structures and Systems, comprised primarily of business activities conducted through AAR Manufacturing, Inc., and (iv) Aircraft Sales and Leasing, comprised of business activities primarily conducted through AAR Aircraft & Engine Sales & Leasing, Inc. Aviation Supply Chain Activities in our Aviation Supply Chain segment include the purchase and sale of a wide variety of new, overhauled and repaired engine and airframe parts and components for our airline and defense customers.

Holders may convert their Notes based on a conversion rate of 28.1116 shares of our common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of $35.57 per share, only under the following circumstances: (i) during any calendar quarter beginning after March 31, 2008 (and only during such calendar quarter) if, as of the last day of the preceding calendar quarter, the closing AAR CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Financing Arrangements (Continued) price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 130% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of notes of the applicable series for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) if a designated event or similar change of control transaction occurs; (iv) upon specified corporate transactions; or (v) beginning on February 1, 2014, in the case of the 2014 notes, or February 1, 2016, in the case of the 2016 notes, and ending at the close of business on the business day immediately preceding the applicable maturity date.

A holder may convert the notes into shares of common stock based on a conversion rate of 33.9789 shares per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $29.43 per share, under the following circumstances: (i) during any calendar quarter beginning after March 31, 2006 (and only during such calendar quarter), if, as of the last day of the AAR CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Financing Arrangements (Continued) preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 120% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the "trading price" per $1,000 principal amount of notes for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) upon a redemption notice; (iv) if a designated event or similar change of control transaction occurs; (v) upon specified corporate transactions; or (vi) during the ten trading day period ending at the close of business on the business day immediately preceding the stated maturity date on the notes.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.25 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;1 First Supplemental Indenture thereto dated August 26, 1991;2 Second Supplemental Indenture thereto dated December 10, 1997.5 4.5 Note Purchase Agreement dated May 1, 2001 between Registrant and various purchasers, relating to the issuance of debt securities to institutional investors.7 4.6 Form of 2.875% Senior Convertible Note.12 4.7 Indenture between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated February 3, 2004.12 4.8 Loan Agreement dated July 15, 2005 between Registrant's Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.16 4.9 Form of 1.75% Senior Convertible Note.19 4.10 Indenture between AAR CORP. and U.S. Bank, National Association, as trustee, dated February 1, 2006.19 4.11 Credit Agreement dated August 31, 2006 among AAR CORP., Bank of America National Association (as successor by merger to LaSalle Bank National Association), as administrative agent, and the various financial institutions party thereto,22 as amended August 31, 2007,26 and March 14, 2008.29 4.12 Form of 1.625% Convertible Senior Note due 2014.28 4.13 Form of 2.25% Convertible Senior Note due 2016.28 4.14 Indenture for 1.625% Convertible Senior Notes due 2014 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.28 4.15 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.28 Index Exhibits Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Supplemental Key Employee Retirement Plan, as Amended and Restated effective January 1, 2005,30 as amended July 11, 200733 and October 17, 2007.38 10.4* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.7 10.5* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko.6 10.6* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.23 10.7* Severance and Change in Control Agreement dated January 14, 2000 between the Registrant and James J. Clark.9 10.8 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.11 10.9 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.11 10.10 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 200515 and May 19, 2006.23 10.11* Form of Non-Qualified Stock Option Agreement.15 10.12* Form of Restricted Stock Agreement.15 10.13* Form of Performance Restricted Stock Agreement.30 10.14* Form of Non-Employee Director Non-Qualified Stock Option Agreement.18 10.15* Form of Director Restricted Stock Agreement.20 10.16* Form of Split Dollar Insurance Agreement.23 10.17 Confirmation of OTC Convertible Note Hedge Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.36 Index Exhibits 10.18 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.27 10.19 Confirmation of OTC Warrant Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.27 10.20 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.27 10.21* Amended and Restated Letter Agreement dated as of June 5, 2008 between AAR CORP. and Howard A. Pulsifer.27 10.22 Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and each of Richard J. Poulton and Robert J. Regan).32 10.23 Form of Directors' and Officers' Indemnification Agreement.33 10.24 Amended and Restated Employment Agreement dated May 31, 2006 between Registrant and David P. Storch, amended December 18, 2008.34 10.25 Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Romenesko, Clark and Sharp).34 10.26 Form of Amendment to the Severance and Change in Control Agreement (applicable to Messrs. Poulton and Regan).34 21.

We conduct our business activities primarily through six principal operating subsidiaries: AAR Parts Trading, Inc., AAR Aircraft & Engine Sales & Leasing, Inc., AAR Services, Inc., AAR Aircraft Services, Inc., AAR Manufacturing, Inc., and AAR International, Inc. Our international business activities are conducted primarily through AAR International, Inc. We report our activities in four business segments: (i) Aviation Supply Chain, comprised primarily of business activities conducted through AAR Parts Trading, Inc., AAR Services, Inc., AAR Allen Services, Inc., (a wholly-owned subsidiary of AAR Parts Trading, Inc. and AAR Services, Inc.), and AAR International, Inc. (ii) Maintenance, Repair and Overhaul, comprised primarily of business activities conducted through AAR Services, Inc., AAR Allen Services, Inc. and AAR Aircraft Services, Inc. (iii) Structures and Systems, comprised primarily of business activities conducted through AAR Manufacturing, Inc., and (iv) Aircraft Sales and Leasing, comprised of business activities primarily conducted through AAR Aircraft & Engine Sales & Leasing, Inc. Aviation Supply Chain Activities in our Aviation Supply Chain segment include the purchase and sale of a wide variety of new, overhauled and repaired engine and airframe parts and components for our airline and defense customers.

Holders may convert their Notes based on a conversion rate of 28.1116 shares of our common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of $35.57 per share, only under the following circumstances: (i) during any calendar quarter beginning after March 31, 2008 (and only during such calendar quarter) if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 130% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of notes of the applicable series for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) if a designated event or similar change of control transaction occurs; (iv) upon specified corporate transactions; or (v) beginning on February 1, 2014, in the case of the 2014 notes, or February 1, 2016, in the case of the 2016 notes, and ending at the close of business on the business day immediately preceding the applicable maturity date.

A holder may convert the notes into shares of common stock based on a conversion rate of 33.9789 shares per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $29.43 per share, under the following circumstances: (i) during any calendar quarter beginning after March 31, 2006 (and only during such calendar quarter), if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 120% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the "trading price" per $1,000 principal amount of notes for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) upon a redemption notice; (iv) if a designated event or similar change of control transaction occurs; (v) upon specified corporate transactions; or (vi) during the ten trading day period ending at the close of business on the business day immediately preceding the stated maturity date on the notes.

4.3 Rights Agreement between the Registrant and Computershare Trust Company dated July 11, 2007.33 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;3 First Supplemental Indenture thereto dated August 26, 1991;4 Second Supplemental Indenture thereto dated December 10, 1997.10 4.5 Officers' certificates relating to debt securities dated October 24, 19896 and October 12, 1993.6 4.6 Note Purchase Agreement dated May 1, 2001 between Registrant and various purchasers, relating to the issuance of debt securities to institutional investors.13 4.7 Form of 2.875% Senior Convertible Note.18 4.8 Indenture between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated February 3, 2004.18 4.9 Loan Agreement dated July 15, 2005 between Registrant's Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.22 4.10 Purchase Agreement between AAR CORP. and Merrill Lynch & Co., for itself and as representative of the other Initial Purchasers, dated January 26, 2006.26 4.11 Form of 1.75% Senior Convertible Note.27 4.12 Indenture between AAR CORP. and U.S. Bank, National Association, as trustee, dated February 1, 2006.27 4.13 Credit Agreement dated August 31, 2006 among AAR CORP., LaSalle Bank National Association, as administrative agent, and the various financial institutions party thereto,31 as amended August 31, 2007,35 and March 14, 2008.38 4.14 Purchase Agreement between AAR CORP. and Merrill Lynch & Co., for itself and as representative of the other Initial Purchasers, dated February 5, 2008.36 4.15 Form of 1.625% Convertible Senior Note due 2014.37 4.16 Form of 2.25% Convertible Senior Note due 2016.37 4.17 Indenture for 1.625% Convertible Senior Notes due 2014 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.37 4.18 Indenture for 2.25% Convertible Senior Notes due 2016 between AAR CORP. and U.S. Bank National Association, as trustee, dated as of February 11, 2008.37 4.19 Registration Rights Agreement for 2014 Notes between AAR CORP. and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative of the initial purchasers, dated February 11, 2008.37 4.20 Registration Rights Agreement for 2016 Notes between AAR CORP. and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative of the initial purchasers, dated February 11, 2008.37 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Supplemental Key Employee Retirement Plan, as Amended and Restated effective January 1, 2005,30 as amended July 11, 200733 and October 17, 2007.38 10.6* Amended and Restated Employment Agreement dated May 31, 2006 between the Registrant and David P. Storch.29 10.7* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.13 10.8* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko.12 10.9* AAR CORP. Nonemployee Directors' Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.32 10.10* Severance and Change in Control Agreement dated January 14, 2000 between the Registrant and James J. Clark.15 10.11 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.17 10.12 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.17 10.13* Consulting Agreement dated October 19, 2005 between the Registrant and Ira A. Eichner.24 10.14 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 200521 and May 19, 2006.32 10.15* Form of Non-Qualified Stock Option Agreement.21 10.16* Form of Restricted Stock Agreement.21 10.17* Form of Performance Restricted Stock Agreement (filed herewith).

10.18* Form of Non-Employee Director Non-Qualified Stock Option Agreement.25 10.19* Form of Director Restricted Stock Agreement.28 10.20* Form of Split Dollar Insurance Agreement.32 10.21* Form of Management Incentive Plan.32 10.22 Confirmation of OTC Convertible Note Hedge Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.36 10.23 Confirmation of OTC Convertible Note Hedge Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.36 10.24 Confirmation of OTC Warrant Transaction for 2014 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.36 10.25 Confirmation of OTC Warrant Transaction for 2016 Notes, dated February 5, 2008, by and between AAR CORP., and Merrill Lynch Financial Markets, Inc.36 10.26* Amended and Restated Letter Agreement dated as of June 5, 2008 between AAR CORP. and Howard A. Pulsifer.39 10.27 Form of Severance and Change in Control Agreement effective from and after July 9, 2008 (entered into between the Registrant and each of Richard J. Poulton and Robert J. Regan).40 Subsidiaries of the Registrant 21.1 Subsidiaries of AAR CORP. (filed herewith).

We conduct our business activities primarily through six principal operating subsidiaries: AAR Parts Trading, Inc., AAR Aircraft & Engine Sales & Leasing, Inc., AAR Services, Inc., AAR Aircraft Services, Inc., AAR Manufacturing, Inc., and AAR International, Inc. Our international business activities are conducted primarily through AAR International, Inc. We report our activities in four business segments: (i) Aviation Supply Chain, comprised primarily of business activities conducted through AAR Parts Trading, Inc., AAR Services, Inc., AAR Allen Services, Inc., a wholly-owned subsidiary of AAR Parts Trading, Inc. and AAR Services, Inc., respectively, and AAR International, Inc. (ii) Maintenance, Repair and Overhaul, comprised primarily of business activities conducted through AAR Services, Inc., AAR Allen Services, Inc. and AAR Aircraft Services, Inc. (iii) Structures and Systems, comprised primarily of business activities conducted through AAR Manufacturing, Inc., and (iv) Aircraft Sales and Leasing, comprised of business activities primarily conducted through AAR Aircraft & Engine Sales & Leasing, Inc. Aviation Supply Chain Activities in our Aviation Supply Chain segment include the purchase and sale of a wide variety of new, overhauled and repaired engine and airframe parts and components for our airline and defense customers.

A holder may convert the notes into shares of common stock based on a conversion rate of 33.9789 shares per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $29.43 per share, under the following circumstances: (i) during any calendar quarter beginning after March 31, 2006 (and only during such calendar quarter), if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 120% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the “trading price” per $1,000 principal amount of notes for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; (iii) upon a redemption notice; (iv) if a designated event or similar change of control transaction occurs; (v) upon specified corporate transactions; or (vi) during the ten trading day period ending at the close of business on the business day immediately preceding the stated maturity date on the notes.

.3 Rights Agreement between the Registrant and the First National Bank of Chicago dated July 8, 19979 and amended October 16, 2001.14 .4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;3 First Supplemental Indenture thereto dated August 26, 1991;4 Second Supplemental Indenture thereto dated December 10, 1997.10 .5 Officers’ certificates relating to debt securities dated October 24, 1989,6 October 12, 1993,6 December 15, 1997,16 and May 30, 2003.16 .6 Note Purchase Agreement dated May 1, 2001 between Registrant and various purchasers, relating to the issuance of debt securities to institutional investors.13 .7 Form of 2.875% Senior Convertible Note.18 .8 Indenture between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated February 3, 2004.18 .9 Registration Rights Agreement between AAR CORP. and Goldman, Sachs & Co., as representative of the several Purchasers, dated February 3, 2004.

.6* Amended and Restated Employment Agreement dated May 31, 2006 between the Registrant and David P. Storch.29 .7* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Howard A. Pulsifer.12 .8* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.13 .9* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko.12 .10* AAR CORP. Nonemployee Directors’ Deferred Compensation Plan, as Amended and Restated effective January 1, 2005.32 .11* Severance and Change in Control Agreement dated January 14, 2000 between the Registrant and James J. Clark.15 .12 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.17 .13 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.17 .14* Consulting Agreement dated October 19, 2005 between the Registrant and Ira A. Eichner.24 .15* Severance and Change in Control Agreement dated April 1, 2003 between AAR Manufacturing, Inc. and Mark McDonald.19 .16 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 200521 and May 19, 2006.32 .17* Form of Non-Qualified Stock Option Agreement.21 .18* Form of Restricted Stock Agreement.21 .19* Form of Performance Restricted Stock Agreement.23 .20* Form of Non-Employee Director Non-Qualified Stock Option Agreement.25 .21* Form of Director Restricted Stock Agreement.28 .22* Form of Split Dollar Insurance Agreement.32 .23* Form of Management Incentive Plan.32 21.

We conduct our business activities primarily through six principal operating subsidiaries: AAR Parts Trading, Inc., AAR Aircraft & Engine Sales & Leasing, Inc., AAR Services, Inc., AAR Aircraft Services, Inc., AAR Manufacturing, Inc., and AAR International, Inc. Our international business activities are conducted primarily through AAR International, Inc. We report our activities in four business segments: (i) Aviation Supply Chain, comprised primarily of business activities conducted through AAR Parts Trading, Inc., AAR Services, Inc., AAR Allen Services, Inc., a wholly-owned subsidiary of AAR Parts Trading, Inc. and AAR Services, Inc., respectively, and AAR International, Inc. (ii) Maintenance, Repair and Overhaul, comprised primarily of business activities conducted through AAR Services, Inc., AAR Allen Services, Inc. and AAR Aircraft Services, Inc. (iii) Structures and Systems, comprised primarily of business activities conducted through AAR Manufacturing, Inc., and (iv) Aircraft Sales and Leasing, comprised of business activities primarily conducted through AAR Aircraft & Engine Sales & Leasing, Inc. Aviation Supply Chain Activities in our Aviation Supply Chain segment include the purchase and sale of a wide variety of new, overhauled and repaired engine and airframe parts and components for our airline and defense customers.

A holder may convert the notes into shares of common stock based on a conversion rate of 33.9789 shares per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $29.43 per share, under the following circumstances: (i) during any calendar quarter beginning after March 31, 2006 (and only during such calendar quarter), if, as of the last day of the preceding calendar quarter, the closing price of our common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading day of such preceding calendar quarter is more than 120% of the applicable conversion price per share of common stock on the last day of such preceding calendar quarter; (ii) during the five business day period after any five consecutive trading day period in which the “trading price” per $1,000 principal amount of notes for each day of that period was less than 98% of the product of the closing price of our common stock and the then applicable conversion rate; AAR CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Financing Arrangements (Continued) (iii) upon a redemption notice; (iv) if a designated event or similar change of control transaction occurs; (v) upon specified corporate transactions; or (vi) during the ten trading day period ending at the close of business on the business day immediately preceding the stated maturity date on the notes.

4.3 Rights Agreement between the Registrant and the First National Bank of Chicago dated July 8, 19979 and amended October 16, 2001.14 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;3 First Supplemental Indenture thereto dated August 26, 1991;4 Second Supplemental Indenture thereto dated December 10, 1997.10 4.5 Officers’ certificates relating to debt securities dated October 24, 1989,6 October 12, 1993,6 December 15, 1997,17and May 30, 2003.17 4.6 Revolving Loan Agreement dated April 11, 2001 between Registrant and LaSalle Bank National Association13 amended November 30, 2001,15 April 22, 2002,15 June 6, 2002,15 March 10, 2003,16 March 21, 2003,16 May 9, 2003,17 June 26, 2003,17 March 2, 2004,21 March 29, 2005,26 and February 27, 2006.35 4.7 Note Purchase Agreement dated May 1, 2001 between Registrant and various purchasers, relating to the issuance of debt securities to institutional investors.13 4.8 Credit Agreement dated May 29, 2003 between Registrant and various subsidiaries and Merrill Lynch Capital and various additional lenders from time to time who are parties thereto,17 as amended January 23, 2004,21 August 24, 2004,22 March 29, 2005,26 and June 20,2006.39 4.9 Form of 2.875% Senior Convertible Note.19 Index Exhibits 4.10 Indenture between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated February 3, 2004.19 4.11 Registration Rights Agreement between AAR CORP. and Goldman, Sachs & Co., as representative of the several Purchasers, dated February 3, 2004.19 4.12 Loan Agreement dated July 15, 2005 between Registrant’s Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.28 4.13 Purchase Agreement between AAR CORP. and Merrill Lynch & Co., for itself and as representative of the other Initial Purchasers, dated January 26, 2006.32 4.14 Form of 1.75% Senior Convertible Note.34 4.15 Indenture between AAR CORP. and U.S. Bank, National Association, as trustee, dated February 1, 2006.34 4.16 Registration Rights Agreement between AAR CORP. and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative of the initial purchasers, dated February 1, 2006.34 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

10.11* Severance and Change in Control Agreement dated January 14, 2000 between the Registrant and James J. Clark.16 10.12 Purchase and Sale Agreement dated March 21, 2003 between AAR Distribution, Inc., AAR Parts Trading, Inc., AAR Manufacturing, Inc., AAR Engine Services, Inc., AAR Allen Services, Inc., the Registrant as Initial Servicer and AAR Receivables Corporation II.16 10.13 Receivables Purchase Agreement dated March 21, 2003 between AAR Receivables Corporation II, the Registrant individually and as Initial Servicer, the Financial Institutions from time to time Parties hereto and LaSalle Business Credit, LLC,16 amended November 30, 2003,21 February 27, 2004,21 October 21, 2004,23 November 30, 2004,24 December 20, 200425 and January 27, 2006.33 10.14 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.18 10.15 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.18 Index Exhibits 10.16* Consulting Agreement dated October 19, 2005 between the Registrant and Ira A. Eichner.30 10.17* Severance and Change in Control Agreement dated April 1, 2003 between AAR Manufacturing, Inc. and Mark McDonald.20 10.18 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 200527 and May 19, 2006 (filed herewith).

Factors Which May Affect Future Results Our operating results and financial position may be adversely affected or fluctuate on a quarterly basis as a result of general economic conditions, geo-political events, the commercial airline environment and other factors, including: (1) declining demand for our products and services and the ability of our customers to meet their financial obligations; (2) relatively high fuel prices and its impact on our commercial customers’ financial position; (3) declining market values for aviation products and equipment; (4) difficulties in re-leasing or selling aircraft and engines that are currently being leased; (5) inability of our Indianapolis airframe maintenance business to capture market share in the highly competitive airframe maintenance market; (6) lack of assurance that sales to the U.S. defense department, its agencies and its contractors (which were 33.7% of total sales in fiscal 2005), will continue at levels previously experienced, including the mix of products sold; (7) access to the debt and equity capital markets and the ability to draw down funds under financing agreements; (8) non-compliance with restrictive and financial covenants contained in certain of our loan agreements; (9) changes in or non-compliance with laws and regulations that may affect certain of our aviation related activities that are subject to licensing, certification and other regulatory requirements imposed by the FAA and other regulatory agencies, both domestic and foreign; (10) competition from other companies, including original equipment manufacturers, some of which have greater financial resources than us; (11) exposure to product liability and property claims that may be in excess of our substantial liability insurance coverage; and (12) the outcome of any pending or future material litigation or environmental proceedings.

The notes are convertible into shares of AAR common stock at an initial conversion price of approximately $18.59 per share, under the following circumstances: (i) on any business day up to the maturity date, if the closing sale price of our common stock for at least 20 trading days in the 30 consecutive trading day period ending on the eleventh trading day of any fiscal quarter is greater than 120% of the applicable conversion price on the eleventh trading day of that quarter; (ii) at any time after February 1, 2019, if the closing price of AAR common stock on any trading day after February 1, 2019, is AAR CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Financing Arrangements (Continued) greater than 120% of the then applicable conversion price; (iii) at any time until February 1, 2019, during the five consecutive business day period in which the trading price for a note for each day of that trading period was less than 98% of the closing sale price of our common stock on such corresponding trading day multiplied by the application conversion rate; (iv) we call the notes for redemption; (v) during any period in which the credit rating assigned to our long-term senior debt by Moody’s Investor Services is below Caa1 and by Standard & Poor’s Rating Services is below B, the credit rating assigned to our long-term senior debt is suspended or withdrawn by both such rating agencies, or neither rating agency is rating our long-term senior debt; or (vi) specified corporate transactions occur.

4.3 Rights Agreement between the Registrant and the First National Bank of Chicago dated July 8, 199710 and amended October 16, 2001.15 4.4 Indenture dated October 15, 1989 between the Registrant and U.S. Bank Trust National Association (formerly known as First Trust, National Association, as successor in interest to Continental Bank, National Association) as Trustee, relating to debt securities;3 First Supplemental Indenture thereto dated August 26, 1991;4 Second Supplemental Indenture thereto dated December 10, 1997.11 4.5 Officers’ certificates relating to debt securities dated October 24, 1989,7 October 12, 1993,7 December 15, 199719 and May 31, 2002.19 4.6 Revolving Loan Agreement dated April 11, 2001 between Registrant and LaSalle Bank National Association16 amended November 30, 2001,17 April 22, 2002,17 June 6, 2002,17 March 10, 2003,18 March 21, 2003,18 May 9, 2003,19 June 26, 2003,19 March 2, 2004,24 and March 29, 2005.29 4.7 Note Purchase Agreement dated May 1, 2001 between Registrant and various purchasers, relating to the issuance of debt securities to institutional investors.16 4.8 Credit Agreement dated May 29, 2003 between Registrant and various subsidiaries and Merrill Lynch Capital and various additional lenders from time to time who are parties thereto,19 as amended January 23, 2004,24 August 24, 2004,25 and March 29, 2005.29 4.9 Loan and Security Agreement dated July 1, 2003 between Registrant’s subsidiary, AAR Wood Dale LLC and Fremont Investment Loan.19 4.10 Form of 2.875% Senior Convertible Note.22 4.11 Indenture between AAR CORP. as Issuer and U.S. Bank National Association, as Trustee dated February 3, 2004.22 4.12 Registration Rights Agreement between AAR CORP. and Goldman, Sachs & Co., as representative of the several Purchasers, dated February 3, 2004.22 4.13 Loan Agreement dated July 15, 2005 between Registrant’s Subsidiary, AAR Wood Dale LLC and Principal Commercial Funding, LLC.30 Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant is not filing certain documents.

Amended and Restated Supplemental Key Employee Retirement Plan, dated May 4, 2000,13 amended April 10, 2001,16 October 10, 2001,17 October 10, 2002,18 December 18, 200218 and July 1, 2003.20 10.7* Amended and Restated Employment Agreement dated July 14, 1998 between the Registrant and David P. Storch13 and amended July 10, 2001.14 10.8* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Howard A. Pulsifer.13 10.9* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.16 10.10* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko.13 10.11* Amended and Restated AAR CORP. Nonemployee Directors’ Deferred Compensation Plan, dated April 8, 1997, amended May 26, 2000,13 December 18, 200218 and July 1, 2003.20 10.12* Severance and Change in Control Agreement dated January 14, 2000 between the Registrant and James J. Clark.18 10.13 Purchase and Sale Agreement dated March 21, 2003 between AAR Distribution, Inc., AAR Parts Trading, Inc., AAR Manufacturing, Inc., AAR Engine Services, Inc., AAR Allen Services, Inc., the Registrant as Initial Servicer and AAR Receivables Corporation II.18 10.14 Receivables Purchase Agreement dated March 21, 2003 between AAR Receivables Corporation II, the Registrant individually and as Initial Servicer, the Financial Institutions from time to time Parties hereto and LaSalle Business Credit, LLC,18 amended November 30, 2003,24 February 27, 2004,24 October 21, 2004,26 November 30, 200427 and December 20, 2004.28 10.15 Indenture dated October 3, 2003 between AAR Distribution, Inc. and iStar Garden City LLC.21 10.16 Lease Agreement dated October 3, 2003 between AAR Allen Services, Inc., as tenant and iStar Garden City LLC, as Landlord, and related Guaranty dated October 3, 2003 from Registrant to iStar Garden City LLC.21 10.17* Consulting Agreement dated June 1, 1999 between the Registrant and Ira A. Eichner amended June 1, 2003.23 10.18* Severance and Change in Control Agreement dated April 1, 2003 between AAR Manufacturing, Inc. and Mark McDonald.23 10.19 Lease Agreement by and between Indianapolis Airport Authority and AAR Aircraft Services, Inc. dated as of June 14, 2004, as amended January 21, 2005 (filed herewith).

We conduct our business activities primarily through five principal operating subsidiaries: AAR Parts Trading, Inc., AAR Aircraft & Engine Sales & Leasing, Inc., AAR Services, Inc., AAR Manufacturing, Inc., and AAR International, Inc. Our international business activities are conducted primarily through AAR International, Inc. We report our activities in four business segments: (i) Inventory and Logistic Services, comprised primarily of business activities conducted through AAR Parts Trading, Inc. and AAR Services, Inc., (ii) Maintenance, Repair and Overhaul, comprised primarily of business activities conducted through AAR Engine Services, Inc. and AAR Allen Services, Inc., wholly-owned subsidiaries of AAR Parts Trading, Inc. and AAR Services, Inc., respectively, and AAR International, Inc., (iii) Manufacturing, comprised primarily of business activities conducted through AAR Manufacturing, Inc., and (iv) Aircraft and Engine Sales and Leasing, comprised of business activities primarily conducted through AAR Aircraft & Engine Sales & Leasing, Inc.

Factors Which May Affect Future Results Our operating results and financial position may be adversely affected or fluctuate on a quarterly basis as a result of general economic conditions, geo-political events, the commercial airline environment and other factors, including: (1) declining demand for our products and services and the ability of our customers to meet their financial obligations; (2) declining market values for aviation products and equipment; (3) difficulties in re-leasing or selling aircraft and engines that are currently being leased; (4) lack of assurance that sales to the U.S. Government, its agencies and its contractors (which were 34.1% of total sales in fiscal 2004), will continue at levels previously experienced; (5) access to the debt and equity capital markets and the ability to draw down funds under financing agreements; (6) non-compliance with restrictive and financial covenants contained in certain of our loan agreements; (7) changes in or non-compliance with laws and regulations that may affect certain of our aviation related activities that are subject to licensing, certification and other regulatory requirements imposed by the FAA and other regulatory agencies, both domestic and foreign; (8) competition from other companies, including original equipment manufacturers, some of which have greater financial resources than us; (9) exposure to product liability and property claims that may be in excess of our substantial liability insurance coverage; and (10) the outcome of any pending or future material litigation or environmental proceedings.

The notes are convertible into shares of AAR common stock based on a conversion rate of 53.7924 shares per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $18.59 per share, under the following circumstances: (i) on any business day up to the maturity date, if the closing sale price of our common stock for at least 20 trading days in the 30 consecutive trading day period ending on the eleventh trading day of any fiscal quarter is greater than 120% of the applicable conversion price on the eleventh trading day of that quarter; (ii) at any time after February 1, 2019, if the closing price of AAR common stock on any trading day after February 1, 2019, is greater than 120% of the then applicable conversion price; (iii) at any time until February 1, 2019, during the five consecutive business day period in which the trading price for a note for each day of that trading period was less than 98% of the closing sale price of our common stock on such corresponding trading day multiplied by the application conversion rate; (iv) we call the notes for redemption; (v) during any period in which the credit rating assigned to our long-term senior debt by Moody's Investor Services is below Caa1 and by Standard & Poor's Rating Services is below B, the credit rating assigned to our long-term senior debt is suspended or withdrawn by both such rating agencies, or neither rating agency is rating our long-term senior debt; or (vi) specified corporate transactions occur.

Amended and Restated Supplemental Key Employee Retirement Plan, dated May 4, 2000,13 amended April 10, 2001,16 October 10, 2001,17 October 10, 2002,18 December 18, 200218 and July 1, 2003.20 10.7* Amended and Restated Employment Agreement dated July 14, 1998 between the Registrant and David P. Storch13 and amended July 10, 2001.14 10.8* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Howard A. Pulsifer.13 10.9* Amended and Restated Severance and Change in Control Agreement dated August 1, 2000 between the Registrant and Michael J. Sharp.16 10.10* Amended and Restated Severance and Change in Control Agreement dated April 11, 2000 between the Registrant and Timothy J. Romenesko.13 10.11* Amended and Restated AAR CORP. Nonemployee Directors' Deferred Compensation Plan, dated April 8, 1997, amended May 26, 2000,13 December 18, 200218 and July 1, 2003.20 10.12* Severance and Change in Control Agreement dated January 14, 2000 between the Registrant and James J. Clark.18 10.13 Purchase and Sale Agreement dated March 21, 2003 between AAR Distribution, Inc., AAR Parts Trading, Inc., AAR Manufacturing, Inc., AAR Engine Services, Inc., AAR Allen Services, Inc., the Registrant as Initial Servicer and AAR Receivables Corporation II.18 10.14 Receivables Purchase Agreement dated March 21, 2003 between AAR Receivables Corporation II, the Registrant individually and as Initial Servicer, the Financial Institutions from time to time Parties hereto and LaSalle Business Credit, LLC, 18 amended November 30, 2003 and February 27, 2004 (filed herewith).

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Dollars in thousands) Factors Which May Affect Future Results The Company’s future operating results and financial position may be adversely affected or fluctuate substantially on a quarterly basis as a result of continuing difficulties in the commercial aviation environment exacerbated by the September 11, 2001 terrorist attacks and the events that followed, the relatively weak worldwide economic climate and other factors, including: (1) decline in demand for the Company’s products and services and the ability of the Company’s customers to meet their financial obligations to the Company, particularly in light of the weakened financial condition of many of the world’s commercial airlines; (2) the potential risk for declining market values for aviation products and equipment caused by various factors, including the bankruptcies of United Airlines, US Airways, Inc., Air Canada, Avianca, Inc. and Hawaiian Airlines, Inc., possible future airline bankruptcies and other factors within the airline industry; (3) difficulties in re-leasing or selling aircraft and engines that are currently being leased on a long- or short-term basis; (4) lack of assurance that sales to the U.S. Government, its agencies and its contractors (which were 28.1% of total sales in fiscal 2003), will continue at levels previously experienced, since such sales are subject to competitive bidding and government funding; (5) access to the debt and equity capital markets and the ability to draw down under financing agreements, which may be limited in light of industry conditions and Company performance; (6) changes in or noncompliance with laws and regulations that may affect certain of the Company’s aviation related activities that are subject to licensing, certification and other regulatory requirements imposed by the FAA and other regulatory agencies, both domestic and foreign; (7) competition from other companies, including original equipment manufacturers, some of which have greater financial resources than the Company; (8) exposure to product liability and property claims that may be in excess of the Company’s substantial liability insurance coverage; (9) difficulties in being able to successfully integrate business acquisitions and (10) the outcome of any pending or future material litigation or environmental proceedings.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Dollars in thousands) Factors Which May Affect Future Results The Company's future operating results and financial position may be adversely affected or fluctuate substantially on a quarterly basis as a result of the difficult commercial aviation environment exacerbated by the September 11, 2001 terrorist attacks and the events that followed, the relatively weak worldwide economic climate and other factors, including: (1) decline in demand for the Company's products and services and the ability of the Company's customers to meet their financial obligations to the Company, particularly in light of the poor financial condition of many of the world's commercial airlines; (2) lack of assurance that sales to the U.S. Government, its agencies and its contractors (which were approximately 25.5% of total sales in fiscal 2002), will continue at levels previously experienced, since such sales are subject to competitive bidding and government funding; (3) access to the debt and equity capital markets to finance growth, which may be limited in light of industry conditions and Company performance; (4) changes in or noncompliance with laws and regulations that may affect certain of the Company's aviation related activities that are subject to licensing, certification and other regulatory requirements imposed by the FAA and other regulatory agencies, both domestic and foreign; (5) competitors, including original equipment manufacturers, in the highly competitive aviation aftermarket industry that have greater financial resources than the Company; (6) exposure to product liability and property claims that may be in excess of the Company's substantial liability insurance coverage; (7) difficulties in being able to successfully integrate future business acquisitions; (8) fluctuating market values for aviation products and equipment in the current aviation environment; (9) difficulty in re-leasing or selling aircraft and engines that are currently being leased on a long or short-term basis and (10) environmental proceedings as described in Item 3.

SIGNATURE TITLE DATE - --------------------------------- ------------------------- ---------------- /s/ IRA A. EICHNER CHAIRMAN OF THE BOARD AND - --------------------------------- CHIEF EXECUTIVE OFFICER; Ira A. Eichner DIRECTOR (PRINCIPAL EXECUTIVE OFFICER) /s/ DAVID P. STORCH PRESIDENT AND CHIEF - --------------------------------- OPERATING OFFICER; David P. Storch DIRECTOR /s/ TIMOTHY J. ROMENESKO VICE - --------------------------------- PRESIDENT-CONTROLLER, Timothy J. Romenesko CHIEF FINANCIAL OFFICER AND TREASURER (PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER) /s/ A. ROBERT ABBOUD DIRECTOR - --------------------------------- A. Robert Abboud /s/ HOWARD B. BERNICK DIRECTOR - --------------------------------- Howard B. Bernick /s/ EDGAR D. JANNOTTA DIRECTOR August 11, 1995 - --------------------------------- Edgar D. Jannotta /s/ ROBERT D. JUDSON DIRECTOR - --------------------------------- Robert D. Judson /s/ ERWIN E. SCHULZE DIRECTOR - --------------------------------- Erwin E. Schulze /s/ JOEL D. SPUNGIN DIRECTOR - --------------------------------- Joel D. Spungin /s/ LEE B. STERN DIRECTOR - --------------------------------- Lee B. Stern /s/ RICHARD D. TABERY DIRECTOR - --------------------------------- Richard D. Tabery EXHIBIT INDEX - ------------------------ Notes: (1) Incorporated by reference to Exhibits to the Registrant's Annual Report on Form 10-K for the fiscal year ended May 31, 1987.

SIGNATURE TITLE DATE - - --------------------------------- ------------------------- ---------------- /s/ IRA A. EICHNER CHAIRMAN OF THE BOARD AND - - --------------------------------- CHIEF EXECUTIVE OFFICER; Ira A. Eichner DIRECTOR (PRINCIPAL EXECUTIVE OFFICER) (PRINCIPAL FINANCIAL OFFICER) /s/ DAVID P. STORCH PRESIDENT AND CHIEF - - --------------------------------- OPERATING OFFICER; David P. Storch DIRECTOR /s/ TIMOTHY J. ROMENESKO VICE PRESIDENT-CONTROLLER - - --------------------------------- (PRINCIPAL ACCOUNTING Timothy J. Romenesko OFFICER) /s/ A. ROBERT ABBOUD DIRECTOR - - --------------------------------- A. Robert Abboud /s/ EDGAR D. JANNOTTA DIRECTOR August 24, 1994 - - --------------------------------- Edgar D. Jannotta /s/ ROBERT D. JUDSON DIRECTOR - - --------------------------------- Robert D. Judson /s/ ERWIN E. SCHULZE DIRECTOR - - --------------------------------- Erwin E. Schulze /s/ JOEL D. SPUNGIN DIRECTOR - - --------------------------------- Joel D. Spungin /s/ LEE B. STERN DIRECTOR - - --------------------------------- Lee B. Stern /s/ RICHARD D. TABERY DIRECTOR - - --------------------------------- Richard D. Tabery EXHIBIT INDEX - - ------------------------ Notes: 1 Incorporated by reference to Exhibits to the Registrant's Annual Report on Form 10-K for the fiscal year ended May 31, 1987.

The factors that affect the value of our real estate include, among other things: •global, national, regional and local economic conditions; •the impact of the COVID-19 pandemic; •competition from other available space; •local conditions such as an oversupply of space or a reduction in demand for real estate in the area; •how well we manage our properties; •the development and/or redevelopment of our properties; •changes in market rental rates; •the timing and costs associated with property improvements and rentals; •whether we are able to pass all or portions of any increases in operating costs through to tenants; •political and regulatory conditions; •changes in real estate taxes and other expenses; •the ability of state and local governments to operate within their budgets; •whether tenants and users such as customers and shoppers consider a property attractive; •changes in consumer preferences adversely affecting retailers and retail store values; •changes in space utilization by our tenants due to technology, economic conditions and business environment; •the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; •consequences of any armed conflict involving, or terrorist attack against, the United States or individual acts of violence in public spaces; •trends in office real estate; •the impact on our retail tenants and demand for retail space at our properties due to increased competition from online shopping; •availability of financing on acceptable terms or at all; •inflation or deflation; •fluctuations in interest rates; •our ability to obtain adequate insurance; •changes in zoning laws and taxation; •government regulation; •potential liability under environmental or other laws or regulations; •natural disasters; •general competitive factors; and •climate changes.

These risks include, without limitation, (i) the availability and pricing of financing on favorable terms or at all; (ii) the availability and timely receipt of zoning and other regulatory approvals; (iii) the potential for the fluctuation of occupancy rates and rents at redeveloped properties, which may result in our investment not being profitable; (iv) start up, repositioning and redevelopment costs may be higher than anticipated; (v) cost overruns and untimely completion of construction (including risks beyond our control, such as weather or labor conditions, or material shortages); (vi) the potential that we may fail to recover expenses already incurred if we abandon development or redevelopment opportunities after we begin to explore them; (vii) the potential that we may expend funds on and devote management time to projects which we do not complete; (viii) the inability to lease a property on schedule or at all, resulting in increased construction or redevelopment costs; and (ix) the possibility that properties will be leased at below expected rental rates.

Among the factors that could affect the price of our common shares are: •our financial condition and performance; •the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; •the impact of the COVID-19 pandemic; •actual or anticipated quarterly fluctuations in our operating results and financial condition; •our dividend policy; •the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; •uncertainty and volatility in the equity and credit markets; •fluctuations in interest rates; •changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; •failure to meet analysts’ revenue or earnings estimates; •speculation in the press or investment community; •strategic actions by us or our competitors, such as acquisitions or restructurings; •the extent of institutional investor interest in us; •the extent of short-selling of our common shares and the shares of our competitors; •fluctuations in the stock price and operating results of our competitors; •general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; •domestic and international economic factors unrelated to our performance; •changes in tax laws and rules; and •all other risk factors addressed elsewhere in this Annual Report on Form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

A security breach or other significant disruption involving our IT networks and related systems could disrupt the proper functioning of our networks and systems and therefore our operations and/or those of certain of our tenants; result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of, proprietary, confidential, sensitive or otherwise valuable information of ours or others, which others could use to compete against us or which could expose us to damage claims by third-parties for disruptive, destructive or otherwise harmful purposes and outcomes; result in our inability to maintain the building systems relied upon by our tenants for the efficient use of their leased space; require significant management attention and resources to remedy any damages that result; subject us to litigation claims for breach of contract, damages, credits, fines, penalties, governmental investigations and enforcement actions or termination of leases or other agreements; or damage our reputation among our tenants and investors generally.

The factors that affect the value of our real estate include, among other things: • global, national, regional and local economic conditions; • competition from other available space; • local conditions such as an oversupply of space or a reduction in demand for real estate in the area; • how well we manage our properties; • the development and/or redevelopment of our properties; • changes in market rental rates; • the timing and costs associated with property improvements and rentals; • whether we are able to pass all or portions of any increases in operating costs through to tenants; • changes in real estate taxes and other expenses; • the ability of state and local governments to operate within their budgets; • whether tenants and users such as customers and shoppers consider a property attractive; • changes in consumer preferences adversely affecting retailers and retail store values; • changes in space utilization by our tenants due to technology, economic conditions and business environment; • the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; • consequences of any armed conflict involving, or terrorist attack against, the United States or individual acts of violence in public spaces; • trends in office real estate; • the impact on our retail tenants and demand for retail space at our properties due to increased competition from online shopping; • availability of financing on acceptable terms or at all; • inflation or deflation; • fluctuations in interest rates; • our ability to obtain adequate insurance; • changes in zoning laws and taxation; • government regulation; • potential liability under environmental or other laws or regulations; • natural disasters; • general competitive factors; and • climate changes.

A security breach or other significant disruption involving our IT networks and related systems could disrupt the proper functioning of our networks and systems and therefore our operations and/or those of certain of our tenants; result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of, proprietary, confidential, sensitive or otherwise valuable information of ours or others, which others could use to compete against us or which could expose us to damage claims by third-parties for disruptive, destructive or otherwise harmful purposes and outcomes; result in our inability to maintain the building systems relied upon by our tenants for the efficient use of their leased space; require significant management attention and resources to remedy any damages that result; subject us to litigation claims for breach of contract, damages, credits, fines, penalties, governmental investigations and enforcement actions or termination of leases or other agreements; or damage our reputation among our tenants and investors generally.

These risks include, without limitation, (i) the availability and pricing of financing on favorable terms or at all; (ii) the availability and timely receipt of zoning and other regulatory approvals; (iii) the potential for the fluctuation of occupancy rates and rents at redeveloped properties, which may result in our investment not being profitable; (iv) start up, repositioning and redevelopment costs may be higher than anticipated; (v) cost overruns and untimely completion of construction (including risks beyond our control, such as weather or labor conditions, or material shortages); (vi) the potential that we may fail to recover expenses already incurred if we abandon development or redevelopment opportunities after we begin to explore them; (vii) the potential that we may expend funds on and devote management time to projects which we do not complete; (viii) the inability to lease a property on schedule or at all, resulting in increased construction or redevelopment costs; and (ix) the possibility that properties will be leased at below expected rental rates.

Among the factors that could affect the price of our common shares are: • our financial condition and performance; • the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; • actual or anticipated quarterly fluctuations in our operating results and financial condition; • our dividend policy; • the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; • uncertainty and volatility in the equity and credit markets; • fluctuations in interest rates; • changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; • failure to meet analysts’ revenue or earnings estimates; • speculation in the press or investment community; • strategic actions by us or our competitors, such as acquisitions or restructurings; • the extent of institutional investor interest in us; • the extent of short-selling of our common shares and the shares of our competitors; • fluctuations in the stock price and operating results of our competitors; • general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; • domestic and international economic factors unrelated to our performance; • changes in tax laws and rules; and • all other risk factors addressed elsewhere in this Annual Report on Form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

The factors that affect the value of our real estate include, among other things: • global, national, regional and local economic conditions; • competition from other available space; • local conditions such as an oversupply of space or a reduction in demand for real estate in the area; • how well we manage our properties; • the development and/or redevelopment of our properties; • changes in market rental rates; • the timing and costs associated with property improvements and rentals; • whether we are able to pass all or portions of any increases in operating costs through to tenants; • changes in real estate taxes and other expenses; • whether tenants and users such as customers and shoppers consider a property attractive; • changes in consumer preferences adversely affecting retailers and retail store values; • changes in space utilization by our tenants due to technology, economic conditions and business environment; • the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; • trends in office real estate; • the impact on our retail tenants and demand for retail space at our properties due to increased competition from online shopping; • availability of financing on acceptable terms or at all; • inflation or deflation; • fluctuations in interest rates; • our ability to obtain adequate insurance; • changes in zoning laws and taxation; • government regulation; • consequences of any armed conflict involving, or terrorist attack against, the United States or individual acts of violence in public spaces, including retail centers; • potential liability under environmental or other laws or regulations; • natural disasters; • general competitive factors; and • climate changes.

A security breach or other significant disruption involving our IT networks and related systems could disrupt the proper functioning of our networks and systems and therefore our operations and/or those of certain of our tenants; result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of, proprietary, confidential, sensitive or otherwise valuable information of ours or others, which others could use to compete against us or which could expose us to damage claims by third-parties for disruptive, destructive or otherwise harmful purposes and outcomes; result in our inability to maintain the building systems relied upon by our tenants for the efficient use of their leased space; require significant management attention and resources to remedy any damages that result; subject us to litigation claims for breach of contract, damages, credits, fines, penalties, governmental investigations and enforcement actions or termination of leases or other agreements; or damage our reputation among our tenants and investors generally.

Among the factors that could affect the price of our common shares are: • our financial condition and performance; • the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; • actual or anticipated quarterly fluctuations in our operating results and financial condition; • our dividend policy; • the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; • uncertainty and volatility in the equity and credit markets; • fluctuations in interest rates; • changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; • failure to meet analysts’ revenue or earnings estimates; • speculation in the press or investment community; • strategic actions by us or our competitors, such as acquisitions or restructurings; • the extent of institutional investor interest in us; • the extent of short-selling of our common shares and the shares of our competitors; • fluctuations in the stock price and operating results of our competitors; • general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; • domestic and international economic factors unrelated to our performance; • changes in tax laws and rules; and • all other risk factors addressed elsewhere in this Annual Report on Form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

The factors that affect the value of our real estate include, among other things: • global, national, regional and local economic conditions; • competition from other available space; • local conditions such as an oversupply of space or a reduction in demand for real estate in the area; • how well we manage our properties; • the development and/or redevelopment of our properties; • changes in market rental rates; • the timing and costs associated with property improvements and rentals; • whether we are able to pass all or portions of any increases in operating costs through to tenants; • changes in real estate taxes and other expenses; • whether tenants and users such as customers and shoppers consider a property attractive; • changes in consumer preferences adversely affecting retailers and retail store values; • changes in space utilization by our tenants due to technology, economic conditions and business environment; • the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; • availability of financing on acceptable terms or at all; • inflation or deflation; • fluctuations in interest rates; • our ability to obtain adequate insurance; • changes in zoning laws and taxation; • government regulation; • consequences of any armed conflict involving, or terrorist attack against, the United States or individual acts of violence in public spaces, including retail centers; • potential liability under environmental or other laws or regulations; • natural disasters; • general competitive factors; and • climate changes.

Among the factors that could affect the price of our common shares are: • our financial condition and performance; • the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; • actual or anticipated quarterly fluctuations in our operating results and financial condition; • our dividend policy; • the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; • uncertainty and volatility in the equity and credit markets; • fluctuations in interest rates; • changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; • failure to meet analysts’ revenue or earnings estimates; • speculation in the press or investment community; • strategic actions by us or our competitors, such as acquisitions or restructurings; • the extent of institutional investor interest in us; • the extent of short-selling of our common shares and the shares of our competitors; • fluctuations in the stock price and operating results of our competitors; • general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; • domestic and international economic factors unrelated to our performance; • changes in tax laws and rules; and • all other risk factors addressed elsewhere in this Annual Report on Form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

The factors that affect the value of our real estate include, among other things: · global, national, regional and local economic conditions; · competition from other available space; · local conditions such as an oversupply of space or a reduction in demand for real estate in the area; · how well we manage our properties; · changes in market rental rates; · the timing and costs associated with property improvements and rentals; · whether we are able to pass all or portions of any increases in operating costs through to tenants; · changes in real estate taxes and other expenses; · whether tenants and users such as customers and shoppers consider a property attractive; · changes in space utilization by our tenants due to technology, economic conditions and business environment; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · availability of financing on acceptable terms or at all; · inflation or deflation; · fluctuations in interest rates; · our ability to obtain adequate insurance; · changes in zoning laws and taxation; · government regulation; · consequences of any armed conflict involving, or terrorist attack against, the United States or individual acts of violence in public spaces, including retail centers; · potential liability under environmental or other laws or regulations; · natural disasters; · general competitive factors; and · climate changes.

Among the factors that could affect the price of our common shares are: · our financial condition and performance; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · actual or anticipated quarterly fluctuations in our operating results and financial condition; · our dividend policy; · the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; · uncertainty and volatility in the equity and credit markets; · fluctuations in interest rates; · changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; · failure to meet analysts’ revenue or earnings estimates; · speculation in the press or investment community; · strategic actions by us or our competitors, such as acquisitions or restructurings; · the extent of institutional investor interest in us; · the extent of short-selling of our common shares and the shares of our competitors; · fluctuations in the stock price and operating results of our competitors; · general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; · domestic and international economic factors unrelated to our performance; and · all other risk factors addressed elsewhere in this annual report on form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

The factors that affect the value of our real estate include, among other things: · global, national, regional and local economic conditions; · competition from other available space; · local conditions such as an oversupply of space or a reduction in demand for real estate in the area; · how well we manage our properties; · changes in market rental rates; · the timing and costs associated with property improvements and rentals; · whether we are able to pass all or portions of any increases in operating costs through to tenants; · changes in real estate taxes and other expenses; · whether tenants and users such as customers and shoppers consider a property attractive; · changes in space utilization by our tenants due to technology, economic conditions and business environment; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · availability of financing on acceptable terms or at all; · inflation or deflation; · fluctuations in interest rates; · our ability to obtain adequate insurance; · changes in zoning laws and taxation; · government regulation; · consequences of any armed conflict involving, or terrorist attack against, the United States or individual acts of violence in public spaces, including retail centers; · potential liability under environmental or other laws or regulations; · natural disasters; · general competitive factors; and · climate changes.

Among the factors that could affect the price of our common shares are: · our financial condition and performance; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · actual or anticipated quarterly fluctuations in our operating results and financial condition; · our dividend policy; · the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; · uncertainty and volatility in the equity and credit markets; · fluctuations in interest rates; · changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; · failure to meet analysts’ revenue or earnings estimates; · speculation in the press or investment community; · strategic actions by us or our competitors, such as acquisitions or restructurings; · the extent of institutional investor interest in us; · the extent of short-selling of our common shares and the shares of our competitors; · fluctuations in the stock price and operating results of our competitors; · general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; · domestic and international economic factors unrelated to our performance; and · all other risk factors addressed elsewhere in this annual report on form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

The factors that affect the value of our real estate include, among other things: · global, national, regional and local economic conditions; · competition from other available space; · local conditions such as an oversupply of space or a reduction in demand for real estate in the area; · how well we manage our properties; · changes in market rental rates; · the timing and costs associated with property improvements and rentals; · whether we are able to pass all or portions of any increases in operating costs through to tenants; · changes in real estate taxes and other expenses; · whether tenants and users such as customers and shoppers consider a property attractive; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · availability of financing on acceptable terms or at all; · inflation or deflation; · fluctuations in interest rates; · our ability to obtain adequate insurance; · changes in zoning laws and taxation; · government regulation; · consequences of any armed conflict involving, or terrorist attack against, the United States or individual acts of violence in public spaces, including retail centers; · potential liability under environmental or other laws or regulations; · natural disasters; · general competitive factors; and · climate changes.

Among the factors that could affect the price of our common shares are: · our financial condition and performance; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · actual or anticipated quarterly fluctuations in our operating results and financial condition; · our dividend policy; · the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; · uncertainty and volatility in the equity and credit markets; · fluctuations in interest rates; · changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; · failure to meet analysts’ revenue or earnings estimates; · speculation in the press or investment community; · strategic actions by us or our competitors, such as acquisitions or restructurings; · the extent of institutional investor interest in us; · the extent of short-selling of our common shares and the shares of our competitors; · fluctuations in the stock price and operating results of our competitors; · general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; · domestic and international economic factors unrelated to our performance; and · all other risk factors addressed elsewhere in this annual report on form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

The factors that affect the value of our real estate include, among other things: · national, regional and local economic conditions; · competition from other available space; · local conditions such as an oversupply of space or a reduction in demand for real estate in the area; · how well we manage our properties; · changes in market rental rates; · the timing and costs associated with property improvements and rentals; · whether we are able to pass all or portions of any increases in operating costs through to tenants; · changes in real estate taxes and other expenses; · whether tenants and users such as customers and shoppers consider a property attractive; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · availability of financing on acceptable terms or at all; · inflation or deflation; · fluctuations in interest rates; · our ability to obtain adequate insurance; · changes in zoning laws and taxation; · government regulation; · consequences of any armed conflict involving, or terrorist attack against, the United States; · potential liability under environmental or other laws or regulations; · natural disasters; · general competitive factors; and · climate changes.

Among the factors that could affect the price of our common shares are: · our financial condition and performance; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · actual or anticipated quarterly fluctuations in our operating results and financial condition; · our dividend policy; · the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; · uncertainty and volatility in the equity and credit markets; · fluctuations in interest rates; · changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; · failure to meet analysts’ revenue or earnings estimates; · speculation in the press or investment community; · strategic actions by us or our competitors, such as acquisitions or restructurings; · the extent of institutional investor interest in us; · the extent of short-selling of our common shares and the shares of our competitors; · fluctuations in the stock price and operating results of our competitors; · general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; · domestic and international economic factors unrelated to our performance; and · all other risk factors addressed elsewhere in this annual report on form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

Incorporated herein by reference from exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q, filed on May 6, 2013 * 10.59 ** - Form of Alexander’s, Inc. 2006 Omnibus Stock Plan Deferred Stock Unit Grant Agreement 10.60 - Second Amendment and Modification of Loan Agreement and Other Loan Documents and Ratification of Guarantor, dated November 15, 2013, by and between Rego II Borrower LLC, as Borrower, and the Lender 10.61 - Partial Release of Mortgage, dated November 15, 2013, by and between Rego II Borrower LLC, as Mortgagor, and the Mortgagee 10.62 - Partial Release of Assignment of Leases and Rents, dated November 15, 2013, by and between Rego II Borrower LLC, as Assignor, and the Assignee - Computation of Ratios - Subsidiaries of Registrant - Consent of Independent Registered Public Accounting Firm 31.1 - Rule 13a-14 (a) Certification of the Chief Executive Officer 31.2 - Rule 13a-14 (a) Certification of the Chief Financial Officer 32.1 - Section 1350 Certification of the Chief Executive Officer 32.2 - Section 1350 Certification of the Chief Financial Officer 101.INS - XBRL Instance Document 101.SCH - XBRL Taxonomy Extension Schema 101.CAL - XBRL Taxonomy Extension Calculation Linkbase 101.DEF - XBRL Taxonomy Extension Definition Linkbase 101.LAB - XBRL Taxonomy Extension Label Linkbase 101.PRE - XBRL Taxonomy Extension Presentation Linkbase ___________________ * Incorporated by reference.

The factors that affect the value of our real estate include, among other things: · national, regional and local economic conditions; · competition from other available space; · local conditions such as an oversupply of space or a reduction in demand for real estate in the area; · how well we manage our properties; · changes in market rental rates; · the timing and costs associated with property improvements and rentals; · whether we are able to pass all or portions of any increases in operating costs through to tenants; · changes in real estate taxes and other expenses; · whether tenants and users such as customers and shoppers consider a property attractive; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · availability of financing on acceptable terms or at all; · fluctuations in interest rates; · our ability to obtain adequate insurance; · changes in zoning laws and taxation; · government regulation; · consequences of any armed conflict involving, or terrorist attack against, the United States; · potential liability under environmental or other laws or regulations; · natural disasters; · general competitive factors; and · climate changes.

Among the factors that could affect the price of our common shares are: · our financial condition and performance; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · actual or anticipated quarterly fluctuations in our operating results and financial condition; · our dividend policy; · the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; · uncertainty and volatility in the equity and credit markets; · changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs; · failure to meet analysts’ revenue or earnings estimates; · speculation in the press or investment community; · strategic actions by us or our competitors, such as acquisitions or restructurings; · the extent of institutional investor interest in us; · the extent of short-selling of our common shares and the shares of our competitors; · fluctuations in the stock price and operating results of our competitors; · general financial and economic market conditions and, in particular, developments related to market conditions for REITs and other real estate related companies; · domestic and international economic factors unrelated to our performance; and · all other risk factors addressed elsewhere in this annual report on form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.

Incorporated herein by reference from Exhibit 10.2 to the registrants Quarterly Report on Form 10-Q for the quarter ended September 30, 2012, filed on November 1, 2012 * 10.53 - Contribution Agreement and Joint Escrow Instructions, dated as of October 21, 2012, by and between Alexander’s Kings Plaza LLC, Alexander’s of Kings LLC and Kings Parking LLC, and Brooklyn Kings Plaza LLC 10.54 - Fifth Amendment to Amended and Restated Management and Development Agreement, dated as of December 1, 2012, by and between Alexander’s, Inc., the subsidiaries party thereto and Vornado Management Corp - Computation of Ratios - Subsidiaries of Registrant - Consent of Independent Registered Public Accounting Firm 31.1 - Rule 13a-14 (a) Certification of the Chief Executive Officer 31.2 - Rule 13a-14 (a) Certification of the Chief Financial Officer 32.1 - Section 1350 Certification of the Chief Executive Officer 32.2 - Section 1350 Certification of the Chief Financial Officer 101.INS - XBRL Instance Document 101.SCH - XBRL Taxonomy Extension Schema 101.CAL - XBRL Taxonomy Extension Calculation Linkbase 101.DEF - XBRL Taxonomy Extension Definition Linkbase 101.LAB - XBRL Taxonomy Extension Label Linkbase 101.PRE - XBRL Taxonomy Extension Presentation Linkbase ___________________ * Incorporated by reference.

The factors that affect the value of our real estate include, among other things: · national, regional and local economic conditions; · competition from other available space; · local conditions such as an oversupply of space or a reduction in demand for real estate in the area; · how well we manage our properties; · changes in market rental rates; · the timing and costs associated with property improvements and rentals; · whether we are able to pass all or portions of any increases in operating costs through to tenants; · changes in real estate taxes and other expenses; · whether tenants and users such as customers and shoppers consider a property attractive; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · availability of financing on acceptable terms or at all; · fluctuations in interest rates; · our ability to obtain adequate insurance; · changes in zoning laws and taxation; · government regulation; · consequences of any armed conflict involving, or terrorist attack against, the United States; · potential liability under environmental or other laws or regulations; · natural disasters; · general competitive factors; and · climate changes.

Among the factors that could affect the price of our common shares are: · our financial condition and performance; · the financial condition of our tenants, including the extent of tenant bankruptcies or defaults; · actual or anticipated quarterly fluctuations in our operating results and financial condition; · our dividend policy; · the reputation of REITs and real estate investments generally and the attractiveness of REIT equity securities in comparison to other equity securities, including securities issued by other real estate companies, and fixed income securities; · uncertainly and volatility in the equity and credit markets; · changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other real estate investment trusts; · failure to meet analysts’ revenue or earnings estimates; · speculation in the press or investment community; · strategic actions by us or our competitors, such as acquisitions or restructurings; · the extent of institutional investor interest in us; · the extent of short-selling of our common shares and the shares of our competitors; · fluctuations in the stock price and operating results of our competitors; · general financial and economic market conditions and, in particular, developments related to market conditions for real estate investment trusts and other real estate related companies; · domestic and international economic factors unrelated to our performance; and · all other risk factors addressed elsewhere in this annual report on form 10-K. A significant decline in our stock price could result in substantial losses for stockholders.