EXHIBIT 10.3

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GUARANTEE AND COLLATERAL AGREEMENT

made by

CARGO AIRCRAFT MANAGEMENT, INC.

and certain of its Affiliates

in favor of

SUNTRUST BANK,
as Administrative Agent

Dated as of May 9, 2011

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TABLE OF CONTENTS

Section 1.    DEFINED TERMS    1
1.1.    Definitions    1
1.2.    Other Definitional Provisions    3
Section 2.    GUARANTEE    3
2.1.    Guarantee    3
2.2.    Right of Contribution    4
2.3.    No Subrogation    4
2.4.    Amendments, etc., with respect to the Borrower Obligations    5
2.5.    Guarantee Absolute and Unconditional    5
2.6.    Reinstatement    6
2.7.    Payments    6
Section 3.    GRANT OF SECURITY INTEREST    6
Section 4.    REPRESENTATIONS AND WARRANTIES    7
4.1.    Title; No Other Liens    7
4.2.    Perfected First Priority Liens    7
4.3.    Jurisdiction of Organization    7
4.4.    Restricted Capital Stock and Restricted Accounts    7
4.5.    Aircraft.    8
Section 5.    COVENANTS    8
5.1.    Maintenance of Insurance    8
5.2.    Maintenance of Perfected Security Interest; Further Documentation    8
5.3.    Changes in Locations, Name, etc.    8
5.4.    Notices    9
5.5.    Restricted Capital Stock and Restricted Accounts    9
5.6.    Aircraft    9
5.7.    Further Assurances.    10
Section 6.    REMEDIAL PROVISIONS    11
6.1.    Proceeds to be Turned Over to Administrative Agent    11
6.2.    Application of Proceeds    11
6.3.    Code and Other Remedies    11
6.4.    Deficiency    12
6.5.    Maintenance of United States Citizenship of Grantors    12
Section 7.    THE ADMINISTRATIVE AGENT    12
7.1.    Administrative Agent’s Appointment as Attorney-in-Fact, etc.    12
7.2.    Duty of Administrative Agent    14
7.3.    Filing of Financing Statements    14
7.4.    Authority of Administrative Agent    14

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Section 8.    MISCELLANEOUS    15
8.1.    Amendments in Writing    15
8.2.    Notices    15
8.3.    No Waiver by Course of Conduct; Cumulative Remedies    15
8.4.    Enforcement Expenses; Indemnification    15
8.5.    Successors and Assigns    16
8.6.    Setoff    16
8.7.    Counterparts    16
8.8.    Severability    16
8.9.    Section Headings    17
8.10.    Integration    17
8.11.    GOVERNING LAW    17
8.12.    Submission To Jurisdiction; Waivers    17
8.13.    Acknowledgments    17
8.14.    Additional Grantors    18
8.15.    Releases    18
8.16.    Subordination    18
8.17.    WAIVER OF JURY TRIAL    19

SCHEDULES
Schedule 1    Qualified Aircraft in Collateral Pool
Schedule 2    Jurisdictions of Organization
Schedule 3    Notice Addresses

ANNEX
Annex 1    Form of Assumption Agreement

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THIS GUARANTEE AND COLLATERAL AGREEMENT (this “Agreement”) dated as of May 9,
2011, made by each of the signatories hereto (together with any other entity
that may become a party hereto as provided herein, the “Grantors”), in favor of
SUNTRUST BANK, as Administrative Agent (in such capacity, the “Administrative
Agent”) for the lending and other financial institutions (the “Lenders”) from
time to time parties to the Credit Agreement, dated as of the date hereof (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Cargo Aircraft Management, Inc., a Florida corporation (the
“Borrower”), Air Transport Services Group, Inc., a Delaware corporation
(“Holdings”), the Lenders and the Administrative Agent.
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders and the Administrative Agent have entered
into the Credit Agreement, pursuant to which the Lenders have severally agreed
to make extensions of credit to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS, Holdings and the Borrower are members of an affiliated group of
companies that includes each other Grantor;
WHEREAS, the proceeds of the extensions of credit under the Credit Agreement
will be used in part to enable the Borrower to make valuable transfers to one or
more of the other Grantors in connection with the operation of their respective
businesses;
WHEREAS, Holdings, the Borrower and the other Grantors are engaged in related
businesses, and each Grantor will derive substantial direct and indirect benefit
from the making of the extensions of credit under the Credit Agreement; and
WHEREAS, it is a condition precedent to the obligation of the Lenders to make
their respective extensions of credit to the Borrower under the Credit Agreement
that the Grantors shall have executed and delivered this Agreement to the
Administrative Agent for the ratable benefit of the Secured Parties;
NOW, THEREFORE, in consideration of the premises and the agreements hereinafter
set forth, and in order to induce the Administrative Agent and the Lenders to
enter into the Credit Agreement and in order to induce the Lenders to make their
respective extensions of credit to the Borrower thereunder, each Grantor hereby
agrees with the Administrative Agent, for the ratable benefit of the Secured
Parties, as follows:
SECTION 1. DEFINED TERMS
1.1. Definitions. (a) Unless otherwise defined herein, terms defined in the
Credit Agreement and used herein shall have the meanings given to them in the
Credit Agreement.
(b)The following terms shall have the following meanings:

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“Agreement”: this Guarantee and Collateral Agreement, as the same may be
amended, supplemented or otherwise modified from time to time.
“Borrower Obligations”: the collective reference to the unpaid principal of and
interest on the Loans and Reimbursement Obligations and all other obligations,
indebtedness and liabilities of the Borrower (including, without limitation,
(i) interest accruing at the then applicable rate provided in the Credit
Agreement after the maturity of the Loans and Reimbursement Obligations and
interest accruing at the then applicable rate provided in the Credit Agreement
after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to the Borrower, whether
or not a claim for post-filing or post-petition interest is allowed in such
proceeding, and (ii) the due and punctual payment and performance of all
obligations in respect of overdrafts and related liabilities owed to the
Administrative Agent or any of its Affiliates and arising from treasury,
depository and cash management services in connection with any
automated-clearing-house transfers of funds) to the Administrative Agent, the
Letter of Credit Issuer or any Lender (or, in the case of any Specified Hedge
Agreement, any Affiliate of any Lender), whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, or pursuant to, the Credit Agreement, this Agreement, the other
Credit Documents, any Letter of Credit, any Specified Hedge Agreement or any
other document made, delivered or given in connection with any of the foregoing,
in each case whether on account of principal, interest, Reimbursement
Obligations, fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the Administrative Agent or
to the Lenders that are required to be paid by the Borrower pursuant to the
terms of any of the foregoing agreements).
“Citizenship Requirements”: as defined in Section 6.5.
“Collateral”: as defined in Section 3.
“Collateral Account”: any collateral account established by the Administrative
Agent as provided in Section 6.1.
“Guarantor Obligations”: with respect to any Guarantor, all obligations and
liabilities of such Guarantor which may arise under or in connection with this
Agreement (including, without limitation, Section 2) or any other Credit
Document or any Specified Hedge Agreement to which such Guarantor is a party, in
each case whether on account of guarantee obligations, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the Administrative Agent or
to the Lenders that are required to be paid by such Guarantor pursuant to the
terms of this Agreement or any other Credit Document).
“Guarantors”: the collective reference to each Grantor other than the Borrower.
“New York UCC”: the Uniform Commercial Code as from time to time in effect in
the State of New York.
“Obligations”: (i) in the case of the Borrower, the Borrower Obligations and
(ii) in the case of each Guarantor, its Guarantor Obligations.

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“paid in full” and “payment in full”: paid in full in cash.
“Proceeds”: all “proceeds” as such term is defined in Section 9-102(a)(64) of
the New York UCC and, in any event, shall include, without limitation, all
dividends or other income from the Investment Property, collections thereon or
distributions or payments with respect thereto.
“Restricted Accounts”: the Accounts of Holdings or any of its Subsidiaries.
“Restricted Capital Stock”: any Capital Stock of any of Holdings’ Subsidiaries.
“Secured Parties”: the collective reference to the Administrative Agent, the
Letter of Credit Issuer, the Lenders and any Lender Affiliate to which Borrower
Obligations or Guarantor Obligations, as applicable, are owed.
“Securities Act”: the Securities Act of 1933, as amended.
“Transportation Code”: Title 49 of the United States Code, as the same may be
amended, modified, restated or replaced from time to time.
1.2. Other Definitional Provisions. (a) The words “hereof,” “herein,” “hereto”
and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement, and Section and Schedule references are to this Agreement unless
otherwise specified.
(b)The meanings given to terms defined herein shall be equally applicable to
both the singular and plural forms of such terms.
(c)Where the context requires, terms relating to the Collateral or any part
thereof, when used in relation to a Grantor, shall refer to such Grantor’s
Collateral or the relevant part thereof.
SECTION 2. GUARANTEE
2.1. Guarantee. (a) Each of the Guarantors hereby, jointly and severally,
unconditionally and irrevocably, guarantees to the Administrative Agent, for the
ratable benefit of the Secured Parties and their respective successors and
permitted indorsees, transferees and assigns, the prompt and complete payment
and performance by the Borrower when due (whether at the stated maturity, by
acceleration or otherwise) of the Borrower Obligations.
(b)Anything herein or in any other Credit Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Credit Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws relating to
the insolvency of debtors (after giving effect to the right of contribution
established in Section 2.2).
(c)Each Guarantor agrees that the Borrower Obligations may at any time and from
time to time exceed the amount of the liability of such Guarantor hereunder
without

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impairing the guarantee contained in this Section 2 or affecting the rights and
remedies of the Administrative Agent or any Lender hereunder.
(d)The guarantee contained in this Section 2 shall remain in full force and
effect until all the Obligations shall have been satisfied by payment in full,
no Letter of Credit shall be outstanding and the Commitments shall be
terminated, notwithstanding that from time to time during the term of the Credit
Agreement the Borrower may be free from any Borrower Obligations.
(e)Except as provided in Section 8.15, no payment made by the Borrower, any of
the Guarantors, any other guarantor or any other Person or received or collected
by the Administrative Agent or any Lender from the Borrower, any of the
Guarantors, any other guarantor or any other Person by virtue of any action or
proceeding or any setoff, appropriation or application at any time or from time
to time in reduction of or in payment of the Borrower Obligations shall be
deemed to modify, reduce, release or otherwise affect the liability of any
Guarantor hereunder which shall, notwithstanding any such payment (other than
any payment made by such Guarantor in respect of the Borrower Obligations or any
payment received or collected from such Guarantor in respect of the Borrower
Obligations), remain liable for the Borrower Obligations up to the maximum
liability of such Guarantor hereunder until the Borrower Obligations are paid in
full, no Letter of Credit is outstanding and the Commitments are terminated.
2.2. Right of Contribution. Each Guarantor hereby agrees that to the extent that
a Guarantor (other than Holdings) shall have paid more than its proportionate
share of any payment made hereunder, such Guarantor shall be entitled to seek
and receive contribution from and against any other Guarantor hereunder which
has not paid its proportionate share of such payment. Each Guarantor’s right of
contribution shall be subject to the terms and conditions of Section 2.3. The
provisions of this Section 2.2 shall in no respect limit the obligations and
liabilities of any Guarantor to the Administrative Agent and the Lenders, and
each Guarantor shall remain liable to the Administrative Agent and the Lenders
for the full amount guaranteed by such Guarantor hereunder.
2.3 No Subrogation. Notwithstanding any payment made by any Guarantor hereunder
or any setoff or application of funds of any Guarantor by the Administrative
Agent or any Lender, no Guarantor shall be entitled to be subrogated to any of
the rights of the Administrative Agent or any Lender against the Borrower or any
other Guarantor or any collateral security, guarantee or right of offset held by
the Administrative Agent or any Lender for the payment of the Borrower
Obligations, nor shall any Guarantor seek any contribution or reimbursement from
the Borrower or any other Guarantor in respect of payments made by such
Guarantor hereunder, until all amounts owing to the Administrative Agent and the
Lenders by the Borrower on account of the Borrower Obligations are paid in full,
no Letter of Credit is outstanding and the Commitments are terminated. If any
amount shall be paid to any Guarantor on account of such subrogation rights at
any time when all of the Borrower Obligations shall not have been paid in full,
such amount shall be held by such Guarantor in trust for the Administrative
Agent and the Lenders, segregated from other funds of such Guarantor, and shall,
forthwith upon receipt by such Guarantor, be turned over to the Administrative
Agent in the exact form received by such Guarantor (duly indorsed by such
Guarantor to the Administrative

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Agent, if required), to be applied against the Borrower Obligations, whether
matured or unmatured, in such order as the Administrative Agent may determine.
For the avoidance of doubt, nothing in the foregoing shall operate as a waiver
of any subrogation rights.
2.4. Amendments, etc., with respect to the Borrower Obligations. To the fullest
extent permitted by applicable law, each Guarantor shall remain obligated
hereunder notwithstanding that, without any reservation of rights against any
Guarantor and without notice to or further assent by any Guarantor, any demand
for payment of any of the Borrower Obligations made by the Administrative Agent
or any Lender may be rescinded by the Administrative Agent or such Lender and
any of the Borrower Obligations continued, and the Borrower Obligations, or the
liability of any other Person upon them or for any part thereof, or any
collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waived, surrendered or released by
the Administrative Agent or any Lender, and the Credit Agreement and the other
Credit Documents and any other documents executed and delivered in connection
therewith may be amended, modified, supplemented or terminated, in whole or in
part, as the Administrative Agent (or the Required Lenders or all Lenders, as
the case may be) may reasonably deem advisable from time to time, and any
collateral security, guarantee or right of offset at any time held by the
Administrative Agent or any Lender for the payment of the Borrower Obligations
may be sold, exchanged, waived, surrendered or released. Neither the
Administrative Agent nor any Lender shall have any obligation to protect,
secure, perfect or insure any Lien at any time held by it as security for the
Borrower Obligations or for the guarantee contained in this Section 2 or any
property subject thereto.
2.5. Guarantee Absolute and Unconditional. To the fullest extent permitted by
applicable law, each Guarantor waives any and all notice of the creation,
renewal, extension or accrual of any of the Borrower Obligations and notice of
or proof of reliance by the Administrative Agent or any Lender upon the
guarantee contained in this Section 2 or acceptance of the guarantee contained
in this Section 2; the Borrower Obligations, and any of them, shall conclusively
be deemed to have been created, contracted or incurred, or renewed, extended,
amended or waived, in reliance upon the guarantee contained in this Section 2;
and all dealings between the Borrower and any of the Guarantors, on the one
hand, and the Administrative Agent and the Lenders, on the other hand, likewise
shall be conclusively presumed to have been had or consummated in reliance upon
the guarantee contained in this Section 2. To the fullest extent permitted by
applicable law, each Guarantor waives diligence, presentment, protest, demand
for payment and notice of default or nonpayment to or upon the Borrower or any
of the Guarantors with respect to the Borrower Obligations. Each Guarantor
understands and agrees that the guarantee contained in this Section 2, to the
fullest extent permitted by applicable law, shall be construed as a continuing,
absolute and unconditional guarantee of payment without regard to (a) the
validity or enforceability of the Credit Agreement or any other Credit Document,
any of the Borrower Obligations or any other collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to
time held by the Administrative Agent or any Lender, (b) any defense, setoff or
counterclaim (other than a defense of payment or performance) which may at any
time be available to or be asserted by the Borrower or any other Person against
the Administrative Agent or any Lender or (c) any other circumstance whatsoever
(with or without notice to or knowledge of the Borrower or such Guarantor) which
constitutes, or might be construed to constitute, an equitable or legal
discharge of the Borrower for the Borrower

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Obligations, or of such Guarantor under the guarantee contained in this Section
2, in bankruptcy or in any other instance. When making any demand hereunder or
otherwise pursuing its rights and remedies hereunder against any Guarantor, the
Administrative Agent or any Lender may, but shall be under no obligation to,
make a similar demand on or otherwise pursue such rights and remedies as it may
have against the Borrower, any other Guarantor or any other Person or against
any collateral security or guarantee for the Borrower Obligations or any right
of offset with respect thereto, and any failure by the Administrative Agent or
any Lender to make any such demand, to pursue such other rights or remedies or
to collect any payments from the Borrower, any other Guarantor or any other
Person or to realize upon any such collateral security or guarantee or to
exercise any such right of offset, or any release of the Borrower, any other
Guarantor or any other Person or any such collateral security, guarantee or
right of offset, shall not relieve any Guarantor of any obligation or liability
hereunder, and shall not impair or affect the rights and remedies, whether
express, implied or available as a matter of law, of the Administrative Agent or
any Lender against any Guarantor. For the purposes hereof “demand” shall include
the commencement and continuance of any legal proceedings.
2.6. Reinstatement. The guarantee contained in this Section 2 shall continue to
be effective, or be reinstated, as the case may be, if at any time payment, or
any part thereof, of any of the Borrower Obligations is rescinded or must
otherwise be restored or returned by the Administrative Agent or any Lender upon
the insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payments had not been made.
2.7. Payments. Each Guarantor hereby guarantees that payments hereunder will be
paid to the Administrative Agent without setoff or counterclaim in Dollars at
the Payment Office.
SECTION 3. GRANT OF SECURITY INTEREST
Each Grantor hereby assigns and transfers to the Administrative Agent, and
hereby grants to the Administrative Agent, for the ratable benefit of the
Secured Parties, a security interest in, all of the following property now owned
or at any time hereafter acquired or created by such Grantor or in which such
Grantor now has or at any time in the future may acquire any right, title or
interest (wherever located, collectively, the “Collateral”), as collateral
security for the prompt and complete payment and performance when due (whether
at the stated maturity, by acceleration or otherwise) of such Grantor’s
Obligations:
(a)all Aircraft listed on Schedule 1 (or on any additions or supplements to such
schedule);
(b)all Aircraft at any time included in the Collateral Pool; and
(c)to the extent not otherwise included, all Proceeds and products of any and
all of the foregoing and all collateral security and guarantees given by any
Person with respect to any of the foregoing.

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SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into the Credit
Agreement and to induce the Lenders to make their respective extensions of
credit to the Borrower thereunder, each Grantor hereby represents and warrants
to the Administrative Agent and each of the other Secured Parties that:
4.1. Title; No Other Liens. Except for the security interest granted to the
Administrative Agent for the ratable benefit of the Secured Parties pursuant to
this Agreement and the Permitted Liens, such Grantor owns each item of the
Collateral free and clear of any and all Liens. No effective financing
statement, security agreement or other public notice with respect to all or any
part of the Collateral is on file, of record or registered in any public office
or is of record under the Cape Town Convention, except such as have been filed
in favor of the Administrative Agent, for the ratable benefit of the Secured
Parties, pursuant to this Agreement or as are expressly permitted by the Credit
Agreement or as to which documentation to terminate the same shall have been
delivered to the Administrative Agent.
4.2. Perfected First Priority Liens. The security interests granted pursuant to
this Agreement (i) upon the filing of financing statements for the Grantors, the
filing with the FAA of Aircraft Security Agreements (or Amended and Restated
Aircraft Security Agrements) covering the Aircraft included in the Collateral,
and the registration of such Liens in the Aircraft under the Cape Town
Convention, will constitute valid perfected security interests in all of the
Collateral in favor of the Administrative Agent, for the ratable benefit of the
Secured Parties, as collateral security for such Grantor’s Obligations,
enforceable in accordance with the terms hereof against all creditors of such
Grantor and any Persons purporting to purchase any Collateral from such Grantor,
to the extent the security interest therein may be perfected by filing,
recording or registration in the United States pursuant to the New York UCC or
the rules and regulations of the FAA and (ii) are prior to all other Liens on
the Collateral in existence on the date hereof except for Permitted Liens which
have priority over the Liens on the Collateral by operation of law (including
the priority rules under the New York UCC) or which are expressly permitted
pursuant to Section 9.3 of the Credit Agreement to be prior to the security
interests granted pursuant to this Agreement.
4.3. Jurisdiction of Organization. On the date hereof, such Grantor’s
jurisdiction of organization and identification number from the jurisdiction of
organization (if any) are specified on Schedule 2. Such Grantor has furnished to
the Administrative Agent a certified charter, certificate of incorporation or
other organization document and long-form good standing certificate as of a date
which is recent to the date hereof.
4.4. Restricted Capital Stock and Restricted Accounts. All Restricted Capital
Stock and all Restricted Accounts are free of any and all Liens or options in
favor of any other Person, except Permitted Liens.
4.5. Aircraft. As of the date hereof, Schedule 1 lists all Qualified Aircraft
included in the Collateral Pool, including the following information for each
such Aircraft: (a) the owner, (b) the make, model, serial number and
registration number of each applicable Airframe, and (c) the make, model, serial
number, if less than 550 horsepower, the takeoff

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horsepower rating, of each Engine attached to each applicable Airframe. Such
schedule also includes the primary location and base of operations for each of
the foregoing. Each Grantor that owns all such Qualified Aircraft are registered
pursuant to the Cape Town Convention. The Borrower shall update Schedule 1
concurrently with any addition of any Qualified Aircraft to the Collateral Pool,
and the above representations shall be deemed to be remade at such time with
respect to all Qualified Aircraft included in the Collateral Pool.
SECTION 5. COVENANTS
Each Grantor covenants and agrees with the Administrative Agent and the other
Secured Parties that, from and after the date of this Agreement until the
Obligations shall have been paid in full, no Letter of Credit shall be
outstanding and the Commitments shall have terminated:
5.1. Maintenance of Insurance. Such Grantor will maintain or caused to be
maintained the insurance required by Section 8.3 of the Credit Agreement.
5.2. Maintenance of Perfected Security Interest; Further Documentation. (a) Such
Grantor shall take all actions reasonably requested by the Administrative Agent
to maintain the security interest created by this Agreement as a security
interest having at least the perfection and priority described in Section 4.2
and shall take all actions reasonably requested by the Administrative Agent to
defend such security interest against the claims and demands of all Persons
whomsoever, subject in each case to Liens permitted by the Credit Agreement and
to the rights of such Grantor under the Credit Documents to dispose of the
Collateral.
(b)Such Grantor will furnish to the Administrative Agent from time to time
statements and schedules further identifying and describing the assets and
property of such Grantor and such other reports in connection therewith as the
Administrative Agent may reasonably request, all in reasonable detail.
(c)At any time and from time to time, upon the written request of the
Administrative Agent, and at the sole expense of such Grantor, such Grantor will
promptly and duly execute and deliver, and have recorded, such further
instruments and documents and take such further actions as the Administrative
Agent may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted,
including, without limitation, filing any financing or continuation statements
under the Uniform Commercial Code (or other similar laws) in effect in any
jurisdiction with respect to the security interests created hereby.
5.3. Changes in Locations, Name, etc. Such Grantor will not, except upon 10
days’ prior written notice to the Administrative Agent (or such shorter notice
as shall be reasonably satisfactory to the Administrative Agent) and delivery to
the Administrative Agent of all additional financing statements and other
documents reasonably requested by the Administrative Agent to maintain the
validity, perfection and priority of the security interests provided for herein,
(i) change its jurisdiction of organization from that referred to in Section 4.3
or (ii) change its name.

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5.4. Notices. Such Grantor will advise the Administrative Agent promptly, in
reasonable detail, of:
(a)any Lien (other than security interests created hereby or Permitted Liens) on
any of the Collateral which could affect the ability of the Administrative Agent
to exercise any of its remedies hereunder; and
(b)the occurrence of any other event which could reasonably be expected to have
a material adverse effect on the aggregate value of the Collateral or on the
security interests created hereby.
5.5. Restricted Capital Stock and Restricted Accounts. Without the prior written
consent of the Administrative Agent, such Grantor shall not (i) sell, assign,
transfer, exchange, or otherwise dispose of, or grant any option with respect
to, any Restricted Capital Stock or Restricted Accounts (except pursuant to a
transaction expressly permitted by Section 9.2 of the Credit Agreement), or
(ii) create, incur or permit to exist any Lien or option in favor of, or any
claim of any Person with respect to, any Restricted Capital Stock or Restricted
Accounts, or any interest therein, except for Permitted Liens.
5.6. Aircraft. (a) Such Grantor shall cause all Qualified Aircraft to be duly
registered in its name by the Aviation Authority, and such Aircraft shall at all
times be subject to United States registration and bear United States
registration markings, and shall take no action that shall cause or permit any
Aircraft to fail to be so registered, and in the event any Aircraft is not so
registered, take all necessary action to cause such Aircraft to be registered as
provided above; provided, that the foregoing shall not apply to the extent the
use or operation of such Aircraft does not require such registration. In
addition, such Grantor that owns Qualified Aircraft shall at all times be
registered pursuant to the Cape Town Convention.
(b)Such Grantor shall maintain, service, repair, overhaul and test, or shall
cause to be maintained, serviced, repaired, overhauled or tested, all Qualified
Aircraft in accordance with any Material Contracts applicable thereto and so as
to keep such Aircraft in good operating condition, ordinary wear and tear
excepted, and in such condition as may be necessary to enable the airworthiness
certification of such Aircraft to be maintained in good standing at all times
under the Transportation Code and all FAA regulations thereunder. Each Grantor
shall maintain, or cause to be maintained, all records, logs and other materials
required to be maintained in respect of all Qualified Aircraft by the
Transportation Code, FAA regulations thereunder, the FAA or any other
Governmental Authority, and shall promptly furnish to the Administrative Agent
such information as the Administrative Agent may reasonably request with respect
thereto.
(c)The Qualified Aircraft shall at all times be used solely for commercial or
business purposes (including, without limitation, dry leases); provided,
however, that such Aircraft may be used as part of Civilian Reserve Air Fleet.
No Grantor will permit any Qualified Aircraft to be maintained, used or operated
in violation of any insurance policy provisions, any Material Contract or any
Requirement of Law of any Governmental Authority having jurisdiction (domestic
or foreign), including without limitation the FAA, or in violation of any
airworthiness certificate, license, registration or operating certificate
relating to such Aircraft and

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issued by any such Governmental Authority, nor will any Grantor suffer any such
Aircraft to be so maintained, used or operated. No Grantor will operate or
suffer any Qualified Aircraft to be operated except within the geographical
limits set forth in applicable insurance policies or operating certificates,
whichever may be the more restrictive. In the event that any Requirement of Law
requires alteration or modification of any Aircraft, the Grantors will conform
thereto or obtain conformance therewith at no expense to the Administrative
Agent. The Grantors will permit or require each Qualified Aircraft to be
operated only by (i) pilots, appropriately qualified and licensed, considering
the particular authorized business or commercial purpose involved and (ii)
appropriately qualified and licensed mechanics, but only in connection with taxi
operations, and will permit each Qualified Aircraft to be maintained only by
duly licensed and qualified mechanics or others as permitted by any Aviation
Authority with jurisdiction over such maintenance. Without limiting the
generality of the foregoing, Grantors will not operate or locate any Qualified
Aircraft or suffer such Aircraft to be operated or located in any recognized or,
in any Grantor’s reasonable judgment, threatened area of hostilities, unless
such operation is within the scope of such Grantor’s insurance coverage or in
connection with a contract with the government of the United States of America
pursuant to which said government has assumed liability for all damage, loss,
destruction or failure to return possession of such Aircraft at the expiration
of the term of such contract as well at for any injury to person or damage to
property of others.
(d)Grantors shall not change the primary location or primary base of operations
of any Qualified Aircraft included in the Collateral Pool from the locations set
forth on Schedule 1 other than with at least 10 Business Days’ prior written
notice to the Administrative Agent.
(e)Such Grantor will not permit the Qualified Aircraft owned or leased by it to
be landed except at established and properly maintained airports and runways
except when reasonably necessary as a precautionary measure or in an emergency
in order to prevent the probable occurrence of damage to such Aircraft or injury
to persons.
5.7. Further Assurances. Each Grantor shall furnish to the Administrative Agent
from time to time upon request statements and schedules further identifying and
describing the Collateral and such other reports in connection with the
Collateral as the Administrative Agent may reasonably request, all in reasonable
detail and in form and substance reasonably satisfactory to the Administrative
Agent. Further, at any time and from time to time, at the request of the
Administrative Agent, and at the sole expense of such Grantor, each Grantor
shall promptly and duly execute and deliver, and have recorded, such further
instruments and documents and take such further action as the Secured Parties
may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted,
including the filing of any financing or continuation statement under the UCC
(or other similar laws) in effect in any jurisdiction with respect to the
security interests created hereby.

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SECTION 6. REMEDIAL PROVISIONS
If any Event of Default shall have occurred and be continuing under Section 10
of the Credit Agreement, the Administrative Agent may exercise in respect of the
Collateral any of the following rights and remedies:

6.1. Proceeds to be Turned Over to Administrative Agent. If the Administrative
Agent so requests, all Proceeds received by any Grantor consisting of cash,
checks and Cash Equivalents shall be held by such Grantor in trust for the
Administrative Agent and the Secured Parties, segregated from other funds of
such Grantor, and shall, forthwith upon receipt by such Grantor, be turned over
to the Administrative Agent in the exact form received by such Grantor (duly
indorsed by such Grantor to the Administrative Agent, if required). All Proceeds
received by the Administrative Agent hereunder shall be held by the
Administrative Agent in a Collateral Account maintained under its sole dominion
and control. All Proceeds while held by the Administrative Agent in a Collateral
Account (or by such Grantor in trust for the Administrative Agent and the
Secured Parties) shall continue to be held as collateral security for all the
Obligations and shall not constitute payment thereof until applied as provided
in Section 6.2.
6.2. Application of Proceeds. If an Event of Default shall have occurred or be
continuing, the Administrative Agent may (and shall at the request of the
Required Lenders) apply any payments received by it under any of the Credit
Documents and all or any part of Proceeds required to be included in Collateral
held in any Collateral Account in payment of the Obligations as set forth in
Section 10.16 of the Credit Agreement.

6.3. Code and Other Remedies. The Administrative Agent, on behalf of the Secured
Parties, may exercise, in addition to all other rights and remedies granted to
them in this Agreement and in any other instrument or agreement securing,
evidencing or relating to the Obligations, all rights and remedies of a secured
party under the New York UCC or any other applicable law. Without limiting the
generality of the foregoing, the Administrative Agent, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon any
Grantor or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase, or otherwise dispose of and deliver the Collateral or any part
thereof (or contract to do any of the foregoing), in one or more parcels at
public or private sale or sales, at any exchange, broker’s board or office of
the Administrative Agent or any Lender or elsewhere upon such terms and
conditions as it may reasonably deem advisable and at such prices as it may
reasonably deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Administrative Agent or any Lender shall have
the right upon any such public sale or sales, and, to the extent permitted by
law, upon any such private sale or sales, to purchase the whole or any part of
the Collateral so sold, free of any right or equity of redemption in any
Grantor, which right or equity is hereby waived and released. Each Grantor
further agrees, at the Administrative Agent’s request, to assemble the
Collateral and make it available to the Administrative Agent at places that the
Administrative Agent shall reasonably select, whether at such Grantor’s premises
or elsewhere. The Administrative Agent shall apply the net proceeds of

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any action taken by it pursuant to this Section 6.3, after deducting all
reasonable out-of-pocket costs and expenses of every kind incurred in connection
therewith or incidental to the care or safekeeping of any of the Collateral or
in any way relating to the Collateral or the rights of the Administrative Agent
and the Secured Parties hereunder, including, without limitation, reasonable
attorneys’ fees and disbursements, to the payment in whole or in part of the
Obligations in accordance with Section 6.2 hereof, and only after such
application and after the payment by the Administrative Agent of any other
amount required by any provision of law, including, without limitation,
Section 9-615(a)(3) of the New York UCC, need the Administrative Agent account
for the surplus, if any, to any Grantor. To the extent permitted by applicable
law, each Grantor waives all claims, damages and demands it may acquire against
the Administrative Agent or any Lender arising out of the exercise by them of
any rights hereunder. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least 10 days before such sale or other disposition.
6.4. Deficiency. Each Grantor shall remain liable for any deficiency if the
proceeds of any sale or other disposition of the Collateral are insufficient to
pay its Obligations and the reasonable fees and disbursements of any attorneys
employed by the Administrative Agent or any Lender to collect such deficiency.
6.5. Maintenance of United States Citizenship of Grantors. The parties hereto
acknowledge that each Grantor that is granting a security interest in Aircraft
is a citizen of the United States as defined under the United States Code, Title
49 (Transportation), Section 40102(a)(15). Notwithstanding any other provision
of this Agreement, the Administrative Agent agrees to exercise its rights and
remedies under this Agreement in a manner that complies in all material respects
at all times, and each Grantor hereby agrees that it will comply at all times,
with the United States citizenship requirements of the above-mentioned laws and
regulations and any successor provisions thereto (the “Citizenship
Requirements”). Any exercise by the Administrative Agent of such rights shall be
void ab initio and unenforceable to the extent that such exercise would result
in contravention of or failure to meet the Citizenship Requirements.  Nothing in
this Section shall in any way affect or impair the Lien of the Administrative
Agent, for the benefit of the Lenders, in the Collateral or the exercise by the
Administrative Agent of its rights and remedies under this Agreement or any
Aircraft Security Agreement filed with the FAA, so long as such exercise is in
compliance with the Citizenship Requirements.  Further, nothing in this Section
shall give rise to any claims, causes of action or other rights in favor of any
Grantor against the Administrative Agent or any Lender.
SECTION 7. THE ADMINISTRATIVE AGENT
7.1. Administrative Agent’s Appointment as Attorney-in-Fact, etc. (a) Each
Grantor hereby irrevocably constitutes and appoints the Administrative Agent and
any officer or agent thereof, with full power of substitution, subject to the
last sentence of this clause (a), as its true and lawful attorney-in-fact with
full irrevocable power and authority in the place and stead of such Grantor and
in the name of such Grantor or in its own name, for the purpose of carrying out
the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, and, without limiting
the generality of the foregoing, each Grantor hereby gives

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the Administrative Agent the power and right, on behalf of such Grantor, without
notice to or assent by such Grantor, to do any or all of the following:
(i)in the name of such Grantor or its own name, or otherwise, take possession of
and indorse and collect any checks, drafts, notes, acceptances or other
instruments for the payment of moneys due with respect to any Proceeds and file
any claim or take any other action or proceeding in any court of law or equity
or otherwise deemed appropriate by the Administrative Agent for the purpose of
collecting any and all such moneys due with respect to any Proceeds whenever
payable;
(ii)pay or discharge taxes and Liens levied or placed on or threatened against
the Collateral, effect any repairs or any insurance called for by the terms of
this Agreement and pay all or any part of the premiums therefor and the costs
thereof;
(iii)execute, in connection with any sale provided for in Section , any
indorsements, assignments or other instruments of conveyance or transfer with
respect to the Collateral; and
(iv)(1) direct any party liable for any payment under any of the Collateral to
make payment of any and all moneys due or to become due thereunder directly to
the Administrative Agent or as the Administrative Agent shall direct; (2) ask or
demand for, collect, and receive payment of and receipt for, any and all moneys,
claims and other amounts due or to become due at any time in respect of or
arising out of any Collateral; (3) sign and indorse any invoices, freight or
express bills, bills of lading, storage or warehouse receipts, drafts against
debtors, assignments, verifications, notices and other documents in connection
with any of the Collateral; (4) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to
collect the Collateral or any portion thereof and to enforce any other right in
respect of any Collateral; (5) defend any suit, action or proceeding brought
against such Grantor with respect to any Collateral; (6) settle, compromise or
adjust any such suit, action or proceeding and, in connection therewith, give
such discharges or releases as the Administrative Agent may reasonably deem
appropriate; and (7) generally, sell, transfer, pledge and make any agreement
with respect to or otherwise deal with any of the Collateral as fully and
completely as though the Administrative Agent were the absolute owner thereof
for all purposes, and do, at the Administrative Agent’s option and such
Grantor’s expense, at any time, or from time to time, all acts and things which
the Administrative Agent deems necessary to protect, preserve or realize upon
the Collateral and the Administrative Agent’s and the Secured Parties’ security
interests therein and to effect the intent of this Agreement, all as fully and
effectively as such Grantor might do.
Anything in this Section 7.1(a) to the contrary notwithstanding, the
Administrative Agent agrees that it will not exercise any rights under the power
of attorney provided for in this Section 7.1(a) unless a Default or an Event of
Default shall have occurred.
(b)If any Grantor fails to perform or comply with any of its agreements
contained herein, the Administrative Agent, at its option, but without any
obligation so to do, may perform or comply, or otherwise cause performance or
compliance, with such agreement.

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(c)The reasonable out-of-pocket expenses of the Administrative Agent incurred in
connection with actions undertaken as provided in this Section 7.1, together
with interest thereon at a rate per annum equal to the highest rate per annum at
which interest would then be payable on any category of past due Loans under the
Credit Agreement, from the date of payment by the Administrative Agent to the
date reimbursed by the relevant Grantor, shall be payable by such Grantor to the
Administrative Agent on demand.
(d)Each Grantor hereby ratifies all that said attorneys shall lawfully do or
cause to be done by virtue hereof. All powers, authorizations and agencies
contained in this Agreement are coupled with an interest and are irrevocable
until this Agreement is terminated and the security interests created hereby are
released.
7.2. Duty of Administrative Agent. The Administrative Agent’s sole duty with
respect to the custody, safekeeping and physical preservation of the Collateral
in its possession, under Section 9‑207 of the New York UCC or otherwise, shall
be to deal with it in the same manner as the Administrative Agent deals with
similar property for its own account. Neither the Administrative Agent, any
Lender nor any of their respective officers, directors, employees or agents
shall be liable for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise dispose of any Collateral upon the request of any Grantor or any
other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof. The powers conferred on the Administrative Agent
and the Secured Parties hereunder are solely to protect the Administrative
Agent’s and the Secured Parties’ interests in the Collateral and shall not
impose any duty upon the Administrative Agent or any Lender to exercise any such
powers. The Administrative Agent and the Secured Parties shall be accountable
only for amounts that they actually receive as a result of the exercise of such
powers, and neither they nor any of their officers, directors, employees or
agents shall be responsible to any Grantor for any act or failure to act
hereunder, except for their own gross negligence or willful misconduct as
determined by a court of competent jurisdiction in a final non-appealable
judgment.
7.3. Filing of Financing Statements. Pursuant to any applicable law, each
Grantor authorizes the Administrative Agent to file or record financing
statements and other filing or recording documents or instruments with respect
to the Collateral without the signature of such Grantor in such form and in such
offices as the Administrative Agent determines appropriate to perfect the
security interests of the Administrative Agent under this Agreement. Each
Grantor hereby ratifies and authorizes the filing by the Administrative Agent of
any financing statement with respect to the Collateral made prior to the date
hereof.
7.4. Authority of Administrative Agent. Each Grantor acknowledges that the
rights and responsibilities of the Administrative Agent under this Agreement
with respect to any action taken by the Administrative Agent or the exercise or
non-exercise by the Administrative Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as between the Administrative Agent and the Secured
Parties, be governed by the Credit Agreement and by such other agreements with
respect thereto as may exist from time to time among them, but, as between the
Administrative Agent and the Grantors, the Administrative Agent shall be
conclusively presumed to be acting as agent for the Secured Parties with full
and valid authority so to act or refrain from acting, and no

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Grantor shall be under any obligation, or entitlement, to make any inquiry
respecting such authority.
SECTION 8. MISCELLANEOUS
8.1. Amendments in Writing. None of the terms or provisions of this Agreement
may be waived, amended, supplemented or otherwise modified except in accordance
with Section 12.12 of the Credit Agreement.
8.2. Notices. All notices, requests and demands to or upon the Administrative
Agent or any Grantor hereunder shall be effected in the manner provided for in
Section 12.3 of the Credit Agreement; provided that any such notice, request or
demand to or upon any Guarantor shall be addressed to such Guarantor at its
notice address set forth on Schedule 3.
8.3. No Waiver by Course of Conduct; Cumulative Remedies. Neither the
Administrative Agent nor any Lender shall by any act (except by a written
instrument pursuant to Section ), delay, indulgence, omission or otherwise be
deemed to have waived any right or remedy hereunder or to have acquiesced in any
Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
power or privilege hereunder shall operate as a waiver thereof. No single or
partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Administrative Agent or any Lender of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Administrative Agent or such Lender would otherwise
have on any future occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
8.4. Enforcement Expenses; Indemnification. (a) Each Guarantor agrees to pay or
reimburse each Lender and the Administrative Agent for all its out‑of‑pocket
costs and expenses incurred in collecting against such Guarantor under the
guarantee contained in or otherwise enforcing or preserving any rights under
this Agreement and the other Credit Documents to which such Guarantor is a
party, including, without limitation, the fees and disbursements of counsel to
the Administrative Agent.
(b)Each Guarantor agrees to pay, and to save the Administrative Agent and the
Secured Parties harmless from, any and all liabilities with respect to, or
resulting from any delay in paying, any and all stamp, excise, sales or other
taxes which may be payable or determined to be payable with respect to any of
the Collateral or in connection with any of the transactions contemplated by
this Agreement.
(c)Each Guarantor agrees to pay, and to save the Administrative Agent and the
Secured Parties harmless from, any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this Agreement to the extent the
Borrower would be required to do so pursuant to Section 12.1 of the Credit
Agreement.

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(d)The agreements in this Section 8.4 shall survive repayment of the Obligations
and all other amounts payable under the Credit Agreement and the other Credit
Documents.
8.5. Successors and Assigns. This Agreement shall be binding upon the permitted
successors and assigns of each Grantor and shall inure to the benefit of the
Administrative Agent, the Letter of Credit Issuer and the Secured Parties and
their permitted successors and assigns; provided that no Grantor may, except
pursuant to a merger or consolidation expressly permitted by Section 9.2 of the
Credit Agreement, assign, transfer or delegate any of its rights or obligations
under this Agreement without the prior written consent of the Administrative
Agent.
8.6. Setoff. In addition to any rights now or hereafter granted under applicable
law or otherwise, and not by way of limitation of any such rights, during the
continuance of an Event of Default, the Administrative Agent and each Lender is
hereby authorized at any time or from time to time, without presentment, demand,
protest or other notice of any kind to any Grantor, any such notice being hereby
expressly waived by each Grantor to the fullest extent permitted by applicable
law, to set off and to appropriate and apply any and all deposits (general or
special) and any other Indebtedness at any time held or owing by the
Administrative Agent or such Lender (including, without limitation, by branches
and agencies of the Administrative Agent or such Lender wherever located) to or
for the credit or the account of any Grantor against and on account of the
Obligations of such Grantor then due and payable to the Administrative Agent or
such Lender under this Agreement or under any of the other Credit Documents,
including, without limitation, all interests in Obligations of the Borrower
purchased by such Lender pursuant to Section 12.4(b) of the Credit Agreement,
and all other claims of any nature or description then due and payable arising
out of or connected with this Agreement or any other Credit Document,
irrespective of whether or not the Administrative Agent or such Lender shall
have made any demand hereunder and although said deposits or Indebtedness owing
by the Administrative Agent or such Lender, or any of them, shall be contingent
or unmatured. The Administrative Agent and each Lender shall notify such Grantor
promptly of any such setoff and the application made by the Administrative Agent
or such Lender of the proceeds thereof, provided that the failure to give such
notice shall not affect the validity of such setoff and application. The rights
of the Administrative Agent and each Lender under this Section 8.6 are in
addition to other rights and remedies (including, without limitation, other
rights of setoff) which the Administrative Agent or such Lender may have.
8.7. Counterparts. This Agreement may be executed by one or more of the parties
to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
8.8. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

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8.9. Section Headings. The Section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.
8.10. Integration. This Agreement and the other Credit Documents represent the
agreement of the Grantors, the Administrative Agent and the Secured Parties with
respect to the subject matter hereof and thereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof and thereof not expressly set forth or
referred to herein or in the other Credit Documents.
8.11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
8.12. Submission To Jurisdiction; Waivers. Each Grantor hereby irrevocably and
unconditionally:
(a)submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Credit Documents to which it is a
party, or for recognition and enforcement of any judgment in respect thereof, to
the non‑exclusive general jurisdiction of the courts of the State of New York,
the courts of the United States of America for the Southern District of New
York, and of any state court of the State of New York located in the Borough of
New York and any appellate courts from any thereof;
(b)consents that any such action or proceeding may be brought in such courts and
waives any objection that it may now or hereafter have to the venue of any such
action or proceeding in any such court or that such action or proceeding was
brought in an inconvenient court and agrees not to plead or claim the same;
(c)agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Grantor at its
address referred to in Section 8.12 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d)agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and
(e)waives, to the maximum extent not prohibited by law, any right it may have to
claim or recover in any legal action or proceeding referred to in this Section
any special, exemplary, punitive or consequential damages.
8.13. Acknowledgments. Each Grantor hereby acknowledges that:
(a)it has been advised by counsel in the negotiation, execution and delivery of
this Agreement and the other Credit Documents to which it is a party;
(b)neither the Administrative Agent, the Letter of Credit Issuer nor any Lender,
in such capacity, has any fiduciary relationship with or duty to any Grantor
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or in connection with this Agreement or any of the other Credit Documents, and
the relationship between the Grantors, on the one hand, and the Administrative
Agent and the Secured Parties, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and
(c)no joint venture is created hereby or by the other Credit Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Secured Parties or among the Grantors and the Secured Parties.
8.14. Additional Grantors. Each Subsidiary of Holdings that is required to
become a party to this Agreement pursuant to Section 8.10 of the Credit
Agreement shall become a Grantor for all purposes of this Agreement upon
execution and delivery by such Subsidiary of an Assumption Agreement in the form
of Annex 1 hereto.
8.15. Releases. (a) At such time as the Loans, the Reimbursement Obligations and
the other Obligations shall have been paid in full, the Commitments have been
terminated and no Letters of Credit shall be outstanding, the Collateral shall
be released from the Liens created hereby, and this Agreement and all
obligations (other than those expressly stated to survive such termination) of
the Administrative Agent and each Grantor hereunder shall terminate, all without
delivery of any instrument or performance of any act by any party, and all
rights to the Collateral shall revert to the Grantors. At the request and sole
expense of any Grantor following any such termination, the Administrative Agent
shall deliver to such Grantor any Collateral held by the Administrative Agent
hereunder and execute and deliver to such Grantor such documents as such Grantor
shall reasonably request to evidence such termination.
(b)If any of the Collateral shall be released as expressly permitted by Section
8.10(c) of the Credit Agreement, then (i) the Liens created hereby on such
Collateral shall automatically be released and (ii) the Administrative Agent, at
the request and sole expense of such Grantor, shall execute and deliver to such
Grantor all releases or other documents reasonably necessary or desirable for
the release of the Liens created hereby on such Collateral.
8.16. Subordination. Each Grantor agrees that any Indebtedness of any Grantor
owing to any other Grantor pursuant to Section 9.4(b) of the Credit Agreement,
whether created prior to, on, or after the date hereof (the “Intercompany
Debt”), shall be subordinated in right of payment to the prior payment in full
of all Obligations. Following the Borrower’ receipt of notice from the
Administrative Agent given during the existence of an Event of Default, the
Grantors shall pay to the Administrative Agent any and all payments in respect
of the Intercompany Debt and any amount so paid to the Administrative Agent
shall be applied to payment of the Obligations as provided in Section 6.2
hereof. Each payment on the Intercompany Debt received in violation of any of
the provisions hereof shall be deemed to have been received by such Grantor as
trustee for the Secured Parties and shall be paid over to the Administrative
Agent immediately on account of the Obligations, but without otherwise affecting
in any manner such Grantor’s liability hereof.
8.17. WAIVER OF JURY TRIAL. EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LEGAL
ACTION OR

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PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.

[Signatures Appear on Following Page]
IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee and
Collateral Agreement to be duly executed and delivered as of the date first
above written.

CARGO AIRCRAFT MANAGEMENT, INC.

By:        /S/ W. JOSEPH PAYNE                    
Name:    W. Joseph Payne
Title:    Vice President

727 AIRCRAFT TWO, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    President

ABX AIR, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    Chief Executive Officer

ABX CARGO SERVICES, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    President

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AIRBORNE GLOBAL SOLUTIONS, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    Chief Executive Officer

AIRBORNE MAINTENANCE AND ENGINEERING
SERVICES, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    Chief Executive Officer

AIR TRANSPORT INTERNATIONAL LIMITED LIABILITY
COMPANY

By:        /S/ CYNTHIA TREADWELL-MCCONNELL        
Name:    Cynthia Treadwell-McConnell
Title:    President

AMES MATERIAL SERVICES INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    President

CAPITAL CARGO INTERNATIONAL AIRLINES, INC.

By:        /S/ DENNIS MANIBUSAN                
Name:    Dennis Manibusan
Title:    President

[Signature Page to Guarantee and Collateral Agreement –
Cargo Aircraft Management, Inc.]

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Page

CARGO AVIATION, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    President

CARGO HOLDINGS INTERNATIONAL, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    Chief Executive Officer

LGSTX FUEL MANAGEMENT, INC.

By:        /S/ QUINT O. TURNER                    
Name:    Quint O. Turner
Title:    President

LGSTX SERVICES, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    Chief Executive Officer

AIR TRANSPORT SERVICES GROUP, INC.

By:        /S/ JOSEPH C. HETE                    
Name:    Joseph C. Hete
Title:    President and Chief Executive Officer

[Signature Page to Guarantee and Collateral Agreement –
Cargo Aircraft Management, Inc.]

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Annex 1 to
Guarantee and Collateral Agreement
ASSUMPTION AGREEMENT, dated as of ________________, 20__, made by
______________________________, a ______________ corporation (the “Additional
Grantor”), in favor of SUNTRUST BANK, as administrative agent (in such capacity,
the “Administrative Agent”), for the lending and other financial institutions
(the “Lenders”) parties to the Credit Agreement referred to below. All
capitalized terms not defined herein shall have the meaning ascribed to them in
such Credit Agreement.
W I T N E S S E T H :
WHEREAS, CARGO AIRCRAFT MANAGEMENT, INC., a Florida corporation (the
“Borrower”), the Lenders and the Administrative Agent have entered into a Credit
Agreement, dated as of May 9, 2011 (as amended, modified, supplemented or
restated from time to time, the “Credit Agreement”);
WHEREAS, in connection with the Credit Agreement, the Borrower, Holdings and
certain of its Affiliates (other than the Additional Grantor) have entered into
the Guarantee and Collateral Agreement, dated as of May 9, 2011 (as amended,
supplemented or otherwise modified from time to time, the “Guarantee and
Collateral Agreement”) in favor of the Administrative Agent for the benefit of
the Secured Parties;
WHEREAS, the Credit Agreement requires the Additional Grantor to become a party
to the Guarantee and Collateral Agreement; and
WHEREAS, the Additional Grantor has agreed to execute and deliver this
Assumption Agreement in order to become a party to the Guarantee and Collateral
Agreement;
NOW, THEREFORE, IT IS AGREED:
1. Guarantee and Collateral Agreement. By executing and delivering this
Assumption Agreement, the Additional Grantor, as provided in Section 8.10 of the
Credit Agreement, hereby becomes a party to the Guarantee and Collateral
Agreement as a Grantor thereunder with the same force and effect as if
originally named therein as a Grantor and, without limiting the generality of
the foregoing, hereby expressly assumes all obligations and liabilities of a
Grantor thereunder (including the guaranty obligations in Section 2 of the
Guaranty and Collateral Agreement) and further grants to the Administrative
Agent on behalf of the Secured Parties a security interest in the Collateral,
pursuant to Section 3 of the Guaranty and Collateral Agreement. The information
set forth in Annex 1-A hereto is hereby added to the information set forth in
the Schedules to the Guarantee and Collateral Agreement. The Additional Grantor
hereby represents and warrants that each of the representations and warranties
contained in Section 4 of the Guarantee and Collateral Agreement is true and
correct

        
LEGAL02/32605971v5

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on and as the date hereof (after giving effect to this Assumption Agreement) as
if made on and as of such date.
2. GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be
duly executed and delivered as of the date first above written.
[ADDITIONAL GRANTOR]

By:    ___________________________
Name:
Title:

        
LEGAL02/32605971v5

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Annex 1-A to
Assumption Agreement
Supplement to Schedule 1
Supplement to Schedule 2
Supplement to Schedule 3