Investor Communications

Ninth Edition 2016 CEO Letter to FLYHT Shareholders: Customer Success Stories Continued

December 5, 2016 Subject: Ninth Edition 2016 CEO Letter to FLYHT Shareholders: Customer Success Stories Continued Dear Shareholders and Interested Parties; This letter concludes the first year of our CEO Letter to FLYHT Shareholders. We began the letters in February to increase communication on company and industry news. We’ve received positive feedback from you, the shareholders, about the letters and their contribution to increasing your awareness about the company. We have decided to keep releasing new letters into 2017, though adjust their frequency in between our standard reporting periods with the aim to produce four to five letters in 2017. As always, we welcome your feedback and ideas for topics you would like discussed. In two previous editions of the letter to shareholders, I shared stories about our customers’ successes and the value they receive by using the Automated Flight Information Reporting System (AFIRSTM). This letter will share a couple more examples on how FLYHT can customize our products to save airlines’ money while improving their operational efficiency. The two success stories I wish to share with you are:

  1. How a customer used AFIRS to monitor unstable approaches for their CRJ aircraft.
  2. How AFIRS data provided information to refute the accusation of a DHC-8 hard landing.AFIRS CRJ900 Unstable Approach

1- AFIRS CRJ900 Unstable Approach

An operator with a fleet of Bombardier CRJ900 aircraft approached FLYHT with a request to improve the safety of their operation by implementing a real-time Flight Data Monitoring (FDM) program specifically designed to monitor for unstable approaches. Generally, airlines and other aviation organizations specify the minimum acceptable criteria to land an aircraft. A summary of those criteria, published by the Flight Safety Foundation, includes confirming the correct flight path, airspeed, landing configuration and other factors to determine that an approach is stabilized. FLYHT’s ability to customize the data airlines receive, how they receive it, and create customizable reports enabled us to support the needs of the customer and their pilot union. AFIRS and UpTimeTM monitors the airline’s operation for unstable approaches and deliver the reports in real time to the flight safety department for analysis and trending. The results of this initiative have been extremely successful to achieve the goal of the program, which was to enhance airline safety.

2- AFIRS DHC-8 Hard Landing

The second success story describes how FLYHT provided AFIRS’ real-time data to help an airline avoid legal action from a passenger. In this case, a FLYHT customer was presented with legal action from one of their passengers claiming to have sustained injury during an alleged hard landing. The flight in question had performed an approach and landing during a period of heavy rain and strong winds. Although the conditions were challenging, at no point did the flight crew identify any exaggerated risk to the safety of the crew, passengers or aircraft. Through AFIRS’ ability to monitor onboard sensors, the airline had set limits per the original equipment manufacturer’s specifications and their own thresholds. If onboard sensors produce data which is outside those thresholds, AFIRS sends an alert to the ground-based user interface, UpTimeTM which in turn notifies key personnel within seconds of the item being flagged. Fortunately, this customer had configured AFIRS to generate a report for hard landings, determined by a measurement of “peak g loads” sustained by the aircraft. In this situation, AFIRS did not generate a hard landing report and the passenger withdrew legal action after learning hard landings were monitored in the aircraft and after receiving a written description that no such event had taken place. The operator saved tens of thousands of dollars in legal fees and unscheduled maintenance. By equipping their aircraft with AFIRS and monitoring for hard landings, our customer demonstrated their commitment to improving safety and operational efficiencies, and saved money in the process! We appreciate your time reading these letters and hope that you find these details informative about how FLYHT’s technology can benefit airlines. On a personal note, I would like to thank all our shareholders for the positive feedback you have provided me since my arrival. I just passed the one year mark as CEO at the end of October and I am more excited about the prospects of this company than when I arrived! I am having a great deal of fun working with our employees, customers, suppliers and stakeholders. I am very proud of the improvements and the transformations underway within the company in how we operate and how we support our customers. We do have a great team. FLYHT wishes you and your family a safe and happy holiday season and look forward to sharing more updates with you in the New Year. Best regards – Thomas R. Schmutz CEO, FLYHT