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EXHIBIT 10.1









EMPLOYMENT AGREEMENT




     This EMPLOYMENT AGREEMENT (“Agreement”), effective as of December 15, 2006 (“Effective Date”)
is entered by and between Gary L. Jensen (“Executive”) and Kitty Hawk Ground, Inc. (“Company”). As
used in this Agreement, the term Company also includes its parent and affiliates.



     WHEREAS, the Company and Executive wish to enter into an Employment Agreement which
replaces and supercedes any existing contractual arrangement.



     WHEREAS, the Company desires to establish its right to the continued services of the
Executive, in the capacity described below, on the terms and conditions and subject to the rights
of termination hereinafter set forth, and the Executive is willing to accept such employment on
such terms and conditions.



     THEREFORE, in consideration of the mutual agreements hereinafter set forth, the Executive and
the Company have agreed and do hereby agree as follows:



     1. EMPLOYMENT AS Vice President and Chief Operating Officer for Kitty
Hawk Ground, Inc.. reporting to the President and Chief Executive Officer for Kitty Hawk,
Inc., The Company does hereby agree to continue to employ Executive as Vice President and
Chief Operating Officer and the Executive does hereby agree to accept continued employment
with the Company as Vice President and Chief Operating Officer on the terms and conditions
set forth herein. Executive shall have those powers and duties normally associated with the
position of Vice President and Chief Operating officer of entities comparable to the Company
and such other duties and responsibilities as may be assigned to Executive from time to time.
The Executive shall use his best efforts and devote substantially all of his business time
(other than absences due to illness or vacation) to the performance of his duties for the Company.
Notwithstanding the above, Executive shall be permitted, to the extent that such activities
do not interfere with performance of Executive’s duties and responsibilities hereunder, to: (i)
manage Executive’s personal, financial and legal affairs, (ii) to serve on civic or charitable
boards or committees, it being expressly understood and agreed Executive may continue serving on any such boards and/or committees on which Executive is serving or with which
Executive is associated as of the Effective Date as set forth on Appendix 1 hereto, and (iii) to give lectures and be involved in speaking engagements associated with Executive’s
community service or service to civic or charitable boards or committees.



          (a) PLACE OF PERFORMANCE. Unless relocated, the principal place of employment of Executive
shall be at the Company’s principle executive offices in the Dallas/Fort Worth, Texas metropolitan
area.




     2. TERM OF AGREEMENT. The term of Executive’s employment under this Agreement shall commence on December 15, 2006 (the “Commencement Date”) and shall



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continue for a period of two (2) years (the “Term”); provided, that, on the second
anniversary of the Commencement Date and on each annual anniversary thereafter, the Term and
Executive’s employment hereunder shall automatically be extended for successive one (1) year
periods unless either party gives written notice not to extend the term of this Agreement ninety
(90) days in advance of the expiration of the Term or any extension thereof.




     3. COMPENSATION.



          (a) BASE SALARY. The Company shall pay the Executive, and the Executive agrees to accept from
the Company for payment of his services to the Company, a base salary at the rate of Two Hundred
Thousand Dollars ($200,000) per year (“Base Salary”), during the initial Term, payable in equal
semi-monthly installments or at such other time or times as the Executive and the Company shall
agree. Thereafter, Executive’s Base Salary shall be reviewed on a calendar year basis, by the
Compensation Committee of the Board (the “Committee”), and may be increased as determined by the
Committee and approved by the Board in its sole and absolute discretion. Such increased Base Salary
shall be used for all purposes under this Agreement. Executive’s Base Salary shall not be decreased
during the Term.




          (b) PERFORMANCE BONUS. Pursuant to the terms of any plan then existing, Executive shall be
eligible to receive an annual cash performance bonus based on the achievement of annual
performance goals to be established by the Committee (the “Bonus”). Such Bonus, if any, shall be
paid when annual performance bonuses are customarily paid, but in no event later than 30 days
following the finalization of audited financial statements and filing of the Company’s 10k (the
“Payment Date”).




          (c) INCENTIVE COMPENSATION. To the extent that the Company maintains or establishes any
incentive compensation plans applicable to senior executive officers and that are adopted by the
Board of Directors, Executive shall participate in any such plans or programs pursuant to the
terms and conditions contained in such plans.




     4. BENEFITS.



          (a) FRINGE BENEFITS. Executive shall be entitled to participate in any benefit programs
adopted from time to time by the Company for the benefit of its executive officers, and Executive
shall be entitled to receive such other fringe benefits as may be granted to him from time to time
by the Company’s Board of Directors.




          (b) BENEFIT PLANS. Executive shall be entitled to participate in any benefit plans relating
to stock options, stock purchases, pension, thrift, profit sharing, life and disability insurance,
medical coverage, executive medical coverage, education, or other retirement or employee benefits
available to other executive employees of the Company, subject to any and all terms and conditions
contained in such plans.






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          (c) VACATION. Executive shall be entitled to four (4) weeks of paid vacation per year. Unused
vacation may be carried forward from year to year to the extent allowed by the Company’s regular
vacation policy.




     5. BUSINESS EXPENSES. The Company shall reimburse the Executive for any and all necessary,
customary, and usual business related expenses, properly documented in accordance with Company
policies.



     6. CORPORATE RELOCATION. Should the Company relocate its principal executive offices to a
location outside of the Dallas/Fort Worth, Texas, metroplex area, and Executive is required to
relocate to such area, the Company will reimburse the Executive for all of his reasonable and
customary relocation expenses pursuant to the Company’s regular relocation policy then in effect.



     7. CONFIDENTIAL INFORMATION.



          Executive recognizes that by reason of his employment by and service to the Company he will
occupy a position of trust with respect to the business and its employees and technical and other
information of a secret or confidential nature (“Confidential Information”) which is the property
of the Company which the Company hereby agrees to provide Executive and which may also be imparted
to him from time to time in the course of the performance of his duties hereunder. Executive
acknowledges that such information is a valuable and unique asset of the Company and agrees that he
shall not, during or after the Term of this Agreement, directly or indirectly use or disclose any
Confidential Information of the Company to any person, except that Executive may use and disclose
to authorized personnel of the Company such Confidential Information as is reasonably appropriate
in the course of the performance of his duties hereunder. Confidential Information of the Company
shall include all information and knowledge of any nature and in any form relating to the Company
and its subsidiaries and affiliates including but not limited to, business plans; development
projects; computer software and related documentation and materials; designs, practices, processes,
methods, know-how and other facts relating to the business of the Company and its subsidiaries and
its affiliates; advertising, promotions, financial matters, sales and profit figures, employee
hiring, training, evaluations and retention practices and customers or customer lists. Confidential
Information shall not include any information that is or shall become publicly known through no
fault of the Executive and any information received in good faith on a non-confidential basis from
a third party who has the right to disclose such information and who has not received such
information, either directly or indirectly, from the Company. If Executive is required to disclose
Confidential Information by any court or governmental tribunal, Executive shall, to the extent
practical under the circumstances, first give notice to the Company in order that it may have an
opportunity to seek a protective order. The Company and Executive shall cooperate with each other,
should either decide to seek a protective order with all costs and expenses being borne by the
party seeking such order. Executive shall abide by the final order, judgment, or decree of any
court of competent jurisdiction, administration or regulatory body regarding such application for a
protective order.







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     8. TERMINATION OF EXECUTIVE’S EMPLOYMENT.



          (a) DEATH. If the Executive dies while employed by the Company, his employment shall
immediately terminate. Upon Executive’s death, the Company shall pay or provide to Executive’s
estate or his beneficiaries within thirty (30) business days following such death or such other
time set forth herein: (i) his earned, but unpaid Base Salary through the date of his termination
of employment, (ii) any earned, but unpaid Bonus for the year prior to the year of termination of
employment to be paid on the Payment Date with respect to that Bonus, (iii) his earned, but unused
vacation pay to the extent provided for under the Company’s vacation policy; (iv) properly
documented unreimbursed business expenses, and (v) any other benefits in accordance with the
Company’s retirement, insurance, and other applicable benefit programs and plans then in effect
(the “Accrued Benefits”). If Executive’s death occurs during a year, Executive’s beneficiaries or
estate shall also be paid on the Payment Date, a pro-rated Bonus, if any, for the year equal to the
product of (A) and (B) where (A) is the amount payable to Executive as a Bonus for such year had he
been employed through the last day of the year, and (B) is a fraction, the numerator of which is
the number of days the Executive was employed by the Company during such year and the denominator
is 365 (“Pro-Rated Bonus”).




          (b) DISABILITY. If, as a result of Executive’s mental or physical incapacity, Executive shall
be substantially unable to perform the services for the Company contemplated by this Agreement for
sixty (60) consecutive days or ninety (90) days in any twelve (12) month period (“Disability”),
Executive’s employment may be terminated by the Company for Disability. During any period prior to
such termination during which Executive is absent from the full-time performance of his duties
with the Company due to Disability, the Company shall continue to pay Executive the amounts
contemplated under this Agreement; provided, that, such payments made to the Executive shall be
reduced by amounts received from disability insurance obtained or provided by the Company.
Subsequent to the termination provided for in this Section 8(b), the Company shall pay or provide
Executive the Accrued Benefits at the times set forth in Section 8(a) above and a Pro-Rated Bonus.




          (c) TERMINATION BY EXECUTIVE WITHOUT GOOD REASON OR DUE TO EXECUTIVE NOT RENEWING THE TERM.
Executive may terminate his employment without Good Reason (as defined below) at any time prior to
expiration of the Term. For purposes of this clause (c), if Executive provides the notice not to
renew the Term, such termination shall be treated in the same fashion as a termination by
Executive without Good Reason. Upon such termination of employment, the Company shall pay
Executive his Accrued Benefits at the times set forth in 8(a) above; provided, however, the
benefits described in 8(a)(ii) shall only be paid if such termination occurs after the
finalization of the Company’s audited financial statements for the year prior to the year of
termination.




          (d) TERMINATION BY THE COMPANY FOR CAUSE. The Company may terminate Executive’s employment under this Agreement for “Cause.” For the purposes of this
Agreement, the term “Cause” shall mean Executive’s:






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          (i) conviction by a court of competent jurisdiction of a felony or serious
misdemeanor involving moral turpitude;




          (ii) willful disregard of any written directive of the Company, provided the written
directive is not inconsistent with the Certificate of Incorporation or Bylaws of the
Company or applicable law;




          (iii) breach of his or her fiduciary duty or duty of loyalty under circumstances that
involve personal profit;




          (iv) breach of a material term of this employment agreement; or




          (v) neglect of his duties that has a material adverse effect on the
Company.



     In the event of termination for Cause, the Company shall pay Executive his Accrued Benefits
excluding benefits described in Section 8(a) (ii) at the times set forth in 8(a) above.



          (e) TERMINATION BY THE COMPANY WITHOUT CAUSE. The Company shall have the right to terminate
this Agreement prior to the expiration of the Term, at any time, without Cause. In the event the
Company shall so elect to terminate this Agreement, the Executive shall receive compensation
pursuant to the provisions of Section 10 or Section 14 of this Agreement, as the case may be.




          (f) TERMINATION BY THE EXECUTIVE FOR GOOD REASON. The Executive shall have the right to
terminate this Agreement for Good Reason. In the event Executive so elects to terminate this
Agreement, the Executive shall receive compensation pursuant to the provisions of Section 10 or
Section 14 of this Agreement, as the case may be. For purposes of this Agreement, “Good Reason”
shall mean the occurrence, without the Executive’s prior written consent, of any one or more of
the following events:





               (i) The Company’s material breach of any of the provisions of this Agreement; or




               (ii) A reduction in Executive’s Base Salary; or




               (iii) The relocation of the Company’s principal executive offices to a location outside of
the Dallas/Fort Worth metropolitan area without providing the Executive with relocation expenses
in accordance with Section 6 of this Agreement; or




               (iv) The failure of the Company to provide in all material respects the indemnification set
forth in this Agreement and the Company’s by-laws.


The Executive agrees to provide the Company thirty (30) days’ prior written notice of any
termination for Good Reason, during which 30-day period the Company shall have the right




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to cure, if curable, the circumstances giving rise to the Good Reason stated in such notice.




          (g) Following a termination governed by this Section 8, except as specifically provided in
this Agreement, the Executive shall not be entitled to any other compensation or benefits, except
as may be separately negotiated by the parties and approved by the Board of Directors of the
Company in writing.




     9. TERMINATION PROCEDURE. Any termination of Executive’s employment by the Company or by
Executive during the Term (other than termination pursuant to Section 8(a)) shall be communicated
by written Notice of Termination to the other party hereto in accordance with Section 15. For
purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the
specific termination provision in this Agreement relied upon.



     10. COMPENSATION UPON TERMINATION BY THE COMPANY OTHER THAN FOR CAUSE OR BY THE
EXECUTIVE FOR GOOD REASON. If the Executive’s employment shall be terminated (i) by act of the
Company other than for Cause, or (ii) by the Executive for Good Reason, the Executive shall be
entitled to the following benefits:



          (a) The Accrued Benefits which shall be paid at the times set forth in Section 8(a) above and
the Pro-Rated Bonus.




          (b) Executive shall be paid a severance amount in 12 equal semi-monthly installments, which
in the aggregate equals fifty percent (50%) of Executive’s annual rate of Base Salary in effect on
the date of termination (not taking into account any reductions in Base Salary not agreed to by
Executive in writing) (the “Severance Payment”).




          (c) Notwithstanding the terms and conditions of the 2003 Long-Term Equity Incentive Plan or
any agreements entered into thereunder and any other plan or program which may be in effect from
time to time (and for the purpose of this Agreement any such plans and agreements will be deemed
to be amended to reflect the foregoing), with respect to Executive’s initial Incentive Stock
Option Agreement under the 2003 Equity Incentive Plan, Executive’s service with the Company will
be deemed to continue for 12 months following his separation date for purposes of vesting such
that the portion of the option that would have vested during such 12-month period will become
immediately vested and exercisable as of the separation date. With respect to any other equity
based awards granted to Executive from time to time, including, without limitation, stock options,
restricted stock, performance awards and stock appreciation rights, (“Awards”), all such Awards,
if any, will become immediately 100% vested and, if applicable, exercisable upon Executive’s
separation.




          (d) The Company shall continue to provide the Executive with life and disability insurance,
medical, vision and dental coverage, executive medical and other health and welfare benefits for 6
months following Executive’s separation of service or until Executive becomes an eligible
participant in substantially similar or better heath and welfare





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plans which do not exclude pre-existing conditions which were covered by the Company’s
plans, whichever is earlier.




          (e) Following a termination governed by this Section 10, except as specifically provided
in this Agreement, the Executive shall not be entitled to any other compensation or benefits,
except as may be separately negotiated by the parties and approved by the Board of Directors of
the Company in writing.




     11. COMPENSATION UPON THE COMPANY’S NOT RENEWING THE AGREEMENT PURSUANT TO PARAGRAPH 2. If,
pursuant to Section 2, the Executive’s employment is terminated as a result of the
Company’s providing written notice of intent not to renew, the Executive shall be entitled to the
following benefits:



          (a) The Accrued Benefits which shall be paid at the time set forth in Section 8(a) above and
the Pro-Rated Bonus.




          (b) The Severance Payment; provided, that, such Severance Payment shall be offset and reduced
by remuneration earned by Executive during such 6 month Severance Payment period whether as an
employee, consultant, advisor, contractor, partner, agent or in another similar capacity.




          (c) Notwithstanding the terms and conditions of the Company’s 2003 Equity Incentive Plan or
any agreements entered into thereunder and any other plan or program which may be in effect from
time to time (and for purposes of this Agreement any such plans and agreements will be deemed to be
amended to reflect the foregoing), for purposes of vesting of any Awards, Executive’s service with
the Company will be deemed to continue for 12 months following his separation date such that upon
such separation date, all Awards that would have vested during such 12-month period shall
immediately vest as of the separation date. Exercise of any vested Awards will be pursuant to terms
of such plans upon termination of service, provided, however, if within 90 days following the
termination of service, Executive is restricted from exercising any Awards as a result of any
Company or Securities Exchange Commission imposed black-out periods, the number of days in the
blackout period shall be added to the exercise period.




          (d) The Company shall continue to provide the Executive with life and disability insurance,
medical, vision and dental coverage, executive medical and other health and welfare benefits for 6
months following Executive’s separation from service or until Executive becomes an eligible
participant in substantially similar or better heath and welfare plans which do not exclude
pre-existing conditions which were covered by the Company’s plans, whichever is earlier.




          (e) Executive shall be paid the Severance Payment in the manner set forth in Section 10(b) above.





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          (f) Following a termination governed by this Section 11, except as specifically provided in
this Agreement, the Executive shall not be entitled to any other compensation or benefits, except
as may be separately negotiated by the parties and approved by the Board of Directors of the
Company in writing.




     12. NON-COMPETITION PROVISIONS.



          (a) RIGHT TO COMPANY MATERIALS. Executive agrees that all styles, designs, lists, materials,
books, files, reports, correspondence, records, electronically stored data or software and other
documents and all Confidential Information (“Company Materials”) used, prepared, or made available
to Executive, shall be and shall remain the property of the Company. Upon the termination of
employment or the expiration of this Agreement, all Company Materials and all other property of
the Company shall be returned immediately to the Company, and Executive shall not make or retain
any copies of Company Materials or its properly following his termination of employment.




          (b) ANTI-SOLICITATION. Executive promises and agrees that during the Term and for the twelve
(12) month period commencing on the termination of his employment (the “Restricted Period”), he
will not influence or attempt to influence customers or suppliers of the Company or any of its
present or future subsidiaries or affiliates, either directly or indirectly, to divert their
business to any individual, partnership, firm, corporation or other entity then in competition
with the business of the Company, or any subsidiary or affiliate of the Company.




          (c) NON-COMPETITION. Executive promises and agrees that during the Restricted Period, he will
not within the United States, without the prior written consent of the Company, directly or
indirectly, become interested in any capacity (whether as proprietor, director, partner, employee,
agent, independent contractor, consultant, trustee or in any other capacity) or be paid by or
otherwise receive compensation or consideration from any bulk air cargo or bulk air freight
business that is competitive with the specific products or services sold or maintained by the
Company. This shall not prevent Executive from owning securities in any such competitive business
(but without otherwise participating in the activities of such enterprise) if (i) such securities
are listed on any national or regional securities exchange or have been registered under Section
12(g) of the Securities Exchange Act of 1934, and (ii) the Executive does not beneficially own (as
defined by Rule 13d-3 promulgated under the Securities Exchange Act of 1934) in excess of 5% of
the outstanding capital stock of such enterprise.




          (d) SOLICITING EMPLOYEES. During the Restricted Period commencing on the termination of his
employment, Executive promises and agrees that he will not directly or indirectly solicit or
engage in any of the Company’s employees or former employees who worked for the Company at any
time during the six (6) months preceding the termination of Executive’s employment, to work for
any business, individual, partnership, firm, corporation, or other entity then in competition with
the Company or any subsidiary or affiliate of the Company.





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     13. NON-DISPARAGEMENT. The Executive agrees that subsequent to Executive’s employment
hereunder, the Executive will refrain from initiating or engaging in any communication with any
then current or former employee, officer, director, shareholder, customer, vendor or competitor of
Company or any third party other than Executive’s spouse or legal counsel, which could reasonably
be interpreted as derogatory or disparaging to the reputation of the Company and its business
practices, employees, officers, directors and agents.



     14. CHANGE IN CONTROL.



          (a) For purposes of this Agreement, “Change in Control” shall mean: (i) the consummation of a
merger, consolidation, share exchange or any other corporate transaction involving the Company, as
a result of which, the members of the Board, elected by the shareholders of the Company
immediately prior to such transaction fail to constitute at least a majority of the Board of
Directors of the surviving entity resulting from such transaction, or (ii) a sale of all or
substantially all of the assets of the Company to another corporation, individual or entity, as a
result of which, the members of the Board, elected by the shareholders of the Company immediately
prior to such transaction fail to constitute at least a majority of the Board of Directors of the
entity purchasing the assets of the Company; or (iii) any “person” (as such term is defined in
Section 3(a)(9) of the Securities Exchange Act of 1934 (the “Exchange Act”) and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes, after the Commencement Date a
“beneficial owner” (as defined in Rule 13d3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 40% or more (a “40% Shareholder”) of the combined voting
power of the Company’s then outstanding securities eligible to vote for the election of the Board
(the “Company Voting Securities”); provided, however, that an event described in
this paragraph (iii) shall not be deemed to be a Change in Control if any of following becomes
such a beneficial owner: (A) the Company or any majority-owned subsidiary (provided, that this
exclusion applies solely to the ownership levels of the Company or the majority-owned subsidiary),
(B) any employee benefit plan of the Company or any of its majority-owned subsidiaries, (C) any
entity holding voting securities of the Company for or pursuant to the terms of any such plan or
(D) Everest Capital, Resurgence Asset Management LLC or Stockton LLC or any of their affiliates.




          (b) Upon a Change in Control, the Term of this Agreement shall continue for the longer of (a)
the period remaining in the Term or (b) twelve months (such 12 month period, even if the remaining
Term is a longer period, shall be the “Change in Control Period”). Following the expiration of the
Term (as it may be extended pursuant to this paragraph so it is at least twelve (12) months upon a
Change in Control), the Agreement shall renew in accordance with Section 2 of the Agreement unless
either party gives written notice not to extend pursuant to Section 2.





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          (c) (i) If Executive terminates his employment for Good Reason during the Change in Control
Period; (ii) if Executive’s employment is terminated by the Company without Cause during the
Change in Control Period or (iii) if (A) Executive’s employment is terminated by the Company
without Cause 90 days prior to a definitive purchase agreement that results in a Change in Control
and (B) Executive reasonably demonstrates that such termination was at the request of a third
party who had taken steps reasonably calculated to effect a Change in Control and (C) a Change in
Control involving such third party (or a party competing with such third party to effectuate a
Change in Control) does occur, then Executive shall be entitled to the following benefits:





          (i) the Accrued Benefits and the Pro-Rated Bonus at the times set forth in 8(a)
above.




          (ii) A lump sum cash payment equal to two (2) times the Severance Payment.




          (iii) The Company shall continue to provide the Executive with life and disability
insurance, medical, vision and dental coverage, executive medical and other health and
welfare benefits for 6 months following his separation from employment or until Executive
becomes an eligible participant in substantially similar or better heath and welfare plans
which do not exclude pre-existing conditions which were covered by the Company’s plans,
whichever is earlier.




          (iv) Following a termination governed by this Section 14, except as specifically
provided in this Agreement, the Executive shall not be entitled to any other compensation
or benefits, except as may be separately negotiated by the parties and approved by the
Board of Directors of the Company in writing.




          (v) Notwithstanding the terms and conditions of the Company’s 2003 Equity Incentive
Plan or any agreements entered into thereunder and any other plan or program which may be in
effect from time to time (and for the purposes of this Agreement any such plans and
agreements will be deemed to be amended to reflect the foregoing), all Awards, if any, will
become immediately 100% vested and, if applicable, exercisable upon such separation.
Executive will have one year from his separation date in which to exercise vested Awards.



     15. NOTICES. All notices and other communications under this Agreement shall be in writing
and shall be given by hand delivery, facsimile, first class mail, certified or registered with
return receipt requested, or express mail and shall be deemed to have been duly given three (3)
days after mailing or twenty-four (24) hours after transmission of a facsimile to the respective
persons named below:



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	 	If to Company:
	 	Kitty Hawk Inc.
	 

	 	 	 	Attn: Chief Executive Officer
	 

	 	 	 	1515 W. 20th Street, P.O. Box 612787
	 

	 	 	 	DFW International Airport, TX 75261
	 
	 	 	 	 
	 

	 	With a copy to:
	 	Garrett DeVries, Esq.
	 

	 	 	 	Haynes and Boone, LLP
	 

	 	 	 	901 Main Street, Suite 3100
	 

	 	 	 	Dallas, Texas 75202-3789
	 
	 	 	 	 
	 

	 	If to Executive:
	 	Mr. Gary L. Jensen
	 

	 	 	 	237 Harper Court
	 

	 	 	 	Keller, TX 76248






     Either party may change such party’s address for notices by written notice duly given
pursuant hereto.



     16. TERMINATION OF PRIOR AGREEMENTS. Except as provided for herein, this Agreement terminates
and supersedes any and all prior agreements and understandings between the parties with respect to
employment or with respect to the compensation of the Executive by the Company from and after the
Effective Date.



     17. ASSIGNMENT;
SUCCESSORS. This Agreement is personal in its nature and neither of the
parties hereto shall, without the consent of the other, assign or transfer this Agreement or any
rights or obligations hereunder; provided that, in the event of the merger, consolidation,
transfer or sale of all or substantially all of the assets of the Company with or to any other
individual or entity, this Agreement shall, subject to the express provisions hereof, be binding
upon and inure to the benefit of Executive and such successor and such successor shall discharge
and perform all the promises, covenants, duties, and obligations of the Company hereunder.



     18. GOVERNING LAW. This Agreement and the legal relations thus created between the parties
hereto shall be governed by and construed under and in accordance with the laws of the State of
Texas. Executive hereby agrees to exclusive venue in the courts of Tarrant County, Texas.



     19. RESOLUTION OF DIFFERENCES; BREACH OF AGREEMENT. The parties shall use good faith
efforts to resolve any controversy or claim arising out of, or relating to this Agreement or the
breach thereof, first in accordance with the Company’s internal review procedures. If despite
their good faith efforts, the parties are unable to resolve such controversy or claim through the
Company’s internal review procedures, then such controversy or claim shall be resolved by binding
arbitration in Dallas, Texas in accordance with the rules and procedures of the Employment Dispute
Resolution Rules of the American Arbitration Association then in effect. The decision of the
arbitrator shall be final and binding on both parties, and any court of competent jurisdiction may
enter judgment upon the award.




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The prevailing party in such action shall be entitled to recoup their costs and attorneys fees
from the opposing party. This paragraph shall apply to all controversies, disputes or claims
arising out of or relating to this Agreement, with the sole exception of controversies, disputes or
claims under paragraphs 7, 12 and 13, whereby the Company or Executive, in addition to and not in
lieu of any remedies either may have, may seek equitable and legal relief from any court of
competent jurisdiction for any breach of said paragraphs.




     20. ENTIRE AGREEMENT; HEADINGS. This Agreement embodies the entire agreement of the parties
respecting the matters within its scope and may be modified only in writing. Section headings in
this Agreement are included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.



     21. WAIVER; MODIFICATION. Failure to insist upon strict compliance with any of the terms,
covenants, or conditions hereof shall not be deemed a waiver of such term, covenant, or condition,
nor shall any waiver or relinquishment of, or failure to insist upon strict compliance with, any
right or power hereunder at any one or more times be deemed a waiver or relinquishment of such
right or power at any other time or times. This Agreement shall not be modified in any respect
except by a writing executed by each party hereto.



     22. SEVERABILITY. In the event that a court of competent jurisdiction determines that any
portion of this Agreement is in violation of any statute or public policy, only the portions of
this Agreement that violate such statute or public policy shall be stricken. All portions of this
Agreement that do not violate any statute or public policy shall continue in full force and
effect. Further, any court order striking any portion of is Agreement shall modify the stricken
terms as narrowly as possible to give as much effect as possible to the intentions of the parties
under this Agreement.



     23. INDEMNIFICATION. The Company shall indemnify and hold Executive harmless to the maximum
extent permitted by law and consistent with the Company’s Articles of Incorporation and Bylaws of
the Company; provided however, that nothing herein shall prevent the Company from amending its
Articles of Incorporation or Bylaws; provided, however notwithstanding any such amendment,
Executive shall have the right to indemnification which is no less favorable than any other
comparable officer of the Company. The Company’s obligations under this Section 23 shall survive
the termination of this Agreement and Executive’s employment for the maximum period permitted by
law.



     24. COUNTERPARTS. This Agreement may be executed in several counterparts, each of which shall
be deemed to be an original but all of which together will constitute one and the same instrument.



     25. MITIGATION. Executive shall not be required to mitigate amounts payable
under this Agreement by seeking other employment or otherwise, and, except as otherwise
provided in Section 10, 11 and 14 of this Agreement, there shall be no offset against
amounts or benefits due Executive under this Agreement on account of subsequent
employment and/or eligibility for benefits.



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     26. SURVIVAL. The representations, warranties, agreements, covenants, obligations and
other provisions in paragraphs 7, 12, 13, and 15 through 25 shall survive any termination of this
Agreement or the employment of Executive with Company, in each case, according to their intended
terms and temporal limitations, if any.



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     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly
authorized representative, and the Executive has hereunto signed this Agreement, as of the date
first above written.



	 	 	 	 	 
	Kitty Hawk Inc.

 	 	 
	
 	 	12/15/06 
	Robert W. Zoller, Jr. 	 	Date 
	President and Chief Executive Officer
Executive 	 	 
	 
	Executive

 	 	 
	 	 	12-15-06 
	Gary L. Jensen 	 	Date 
	 	 	 
	 




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