##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2006
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 001-13025
 AirNet Systems, Inc.
  Ohio
    
    31-1458309(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)7250 Star Check Drive, Columbus, Ohio
    
    43217(Address of principal executive offices)
    
    (Zip Code)
 (614) 409-4900
  Title of each class
    
    Name of each exchange on which registeredCommon Shares, $0.01 par value
    
    American Stock Exchange LLC
 None
  o þ
  o þ
  þ o
 o
  o o þ
  o þ
   Class
    
    Outstanding at March 19, 2007Common Shares, $0.01 par value
    
    10,168,562 common shares
 DOCUMENT INCORPORATED BY REFERENCE
 Document
    
    Part Into Which IncorporatedPortions of the Registrants definitive Proxy
Statement for the Annual Meeting of
Shareholders to be held on June 6, 2007,
which will be filed subsequent to the filing
of this Annual Report on Form 10-K and not
later than 120 days after December 31, 2006
    
    Part III




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##### 



INDEX
  
 PART IItem 1: BusinessItem 1A: Risk FactorsItem 1B: Unresolved Staff CommentsItem 2: PropertiesItem 3: Legal ProceedingsItem 4: Submission of Matters to a Vote of Security HoldersPART IIItem 5: Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity SecuritiesItem 6: Selected Financial DataItem 7: Managements Discussion and Analysis of Financial Condition and Results of OperationItem 7A: Quantitative and Qualitative Disclosures About Market RiskItem 8: Financial Statements and Supplementary DataItem 9: Changes in and Disagreements With Accountants on Accounting and Financial DisclosureItem 9A: Controls and ProceduresItem 9B: Other InformationPART IIIItem 10: Directors, Executive Officers and Corporate GovernanceItem 11: Executive CompensationItem 12: Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersItem 13: Certain Relationships and Related Transactions, and Director IndependenceItem 14: Principal Accountant Fees and ServicesPART IVItem 15: Exhibits and Financial Statement SchedulesSignaturesExhibit IndexEX-4.50EX-4.51EX-4.52EX-10.25EX-10.26EX-10.29EX-10.31EX-10.32EX-21EX-23EX-24EX-31.1EX-31.2EX-32
  2




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PART I
 
 ITEM 1  BUSINESS
 General
        Sale of Jetrides Passenger Charter Business
  3




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Accounting for the
Impairment or Disposal of Long-Lived Assets
  Bank Services
 Bank Services, primarily consisting of cancelled check delivery, generated approximately 65%,
68% and 68% of AirNets total net revenues for the fiscal years ended December 31, 2006, 2005
and 2004, respectively. AirNets time-critical cancelled check delivery service allows its
banking customers to reduce their float costs and related processing fees. AirNet also
transports other items, such as proof of deposit transactions and interoffice mail, for many
of the same bank customers. The U.S. banking industry, including commercial banks and
third-party processors, represents AirNets largest category of customers. AirNets bank
customers represent many of the nations largest bank holding companies.
 Express Services
 Express Services, which focus on customers with time-critical delivery needs, generated
approximately 34%, 31% and 31% of AirNets total net revenues for the fiscal years ended
December 31, 2006, 2005 and 2004, respectively. Express Services are primarily targeted at
customers involved in the life sciences, and media and entertainment industries, and other
customers whose shipment needs are highly time sensitive, time-definite or highly controlled.
In the life sciences industry, Express Services are offered to customers shipping packages
that require specialized handling, the transportation of which is often highly regulated by
various governmental authorities. Targeted markets within the life sciences industry include
producers and recipients of radioactive pharmaceuticals, diagnostic specimens, blood,
umbilical cord blood, human tissue and organs.
 For those customers requiring time-critical delivery options not available on AirNets
regularly scheduled routes, cargo charter services are available. Cargo charter services may
be regularly scheduled or scheduled on an on-demand, as-needed basis, 24 hours per day, seven
days a week.
 Aviation Services
 AirNet operates a fixed base operation from its Columbus, Ohio facility, offering retail
aviation fuel sales and aircraft maintenance. AirNet continues to provide aircraft
maintenance and Director of Maintenance management services for New Jetride after the sale of
the Jetride passenger charter business in September 2006. AirNet also provides aircraft
maintenance services for Pinnacle aircraft, and for other corporate aircraft and expects to
increase its retail maintenance services in 2007.
 4




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Business Strategy
        5




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Operations
 Air Operations
      Shipment processing
   Ground support
  Fast Forward Solutions
  6




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Regulation
       Seasonality
  Competition
  7




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Environmental matters
      Employees
  8




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ITEM 1A  RISK FACTORS
 The Check 21 Act and electronic methods of clearing cancelled checks have had, and will continue to
have, a significant adverse effect on AirNets revenues derived from check delivery services.
  The use of image replacement documents and other electronic methods to clear cancelled checks is
accelerating and will have a significant adverse effect on AirNets revenues and income.
  AirNet
may be unable to offset losses in its Bank Services revenues and contribution margins with
Express Services revenues and contribution margins, which could adversely affect AirNets
profitability or ability to operate its air transportation network.
  Reductions in AirNets route schedule and the number of aircraft it operates may adversely impact
AirNets Express Services business.
  Competition from other providers of express air and ground delivery services may adversely affect
AirNets results of operations and financial condition.
  9




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It will be difficult for AirNet to dispose of its aircraft and other operating assets in response
to any reductions in its air transportation network or operations.
  Government regulation significantly affects AirNet.
  FAA grounding of AirNets fleet or a specific type of aircraft used in AirNets delivery services
business may adversely affect AirNets business and revenues.
  Loss of AirNet Management, Inc.s Indirect Air Carrier Standard Security Program approval could
adversely affect AirNets business.
  Changes in government regulations regarding the transportation of hazardous materials may increase
AirNets costs of transporting such shipments or reduce AirNets ability to transport such
shipments.
 10




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Reclassification of ground couriers as employees rather than independent contractors could subject
AirNet to back taxes and other liabilities.
  Changes to current transportation security requirements or procedures could adversely impact
AirNets ability to efficiently conduct AirNets air and ground operations to meet AirNets current
delivery parameters or significantly increase costs to transact those operations.
     Catastrophic accidents involving AirNets aircraft could result in a significant reduction in
AirNets business and increase its insurance costs.
  Environmental concerns may arise in connection with AirNets operation at its Rickenbacker Facility
on leased land with known pollution conditions.
 11




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Failure to renew AirNets grantee status to the DOT-SP 7060 Special Permit or AirNets Transport
Canada Permit for Equivalent Level of Safety would result in significant loss of Express Services
revenue.
  Anti-takeover provisions may delay or prevent an acquisition or change in control of AirNet by a
third party.
    Limitations on AirNets ability to borrow could adversely affect AirNets financial condition and
prevent AirNet from fulfilling its financial obligations.
  AirNet may not be able to raise future capital through debt financing which could adversely affect
AirNets ability to execute its Express Services strategy.
  12




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AirNet may encounter issues in documenting and testing its internal control over financial
reporting for purposes of complying with Section 404 of the Sarbanes-Oxley Act of 2002.
  
 ITEM 1B  UNRESOLVED STAFF COMMENTS
  
 ITEM 2  PROPERTIES
 Operating facilities
     13




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Fleet
 Cargo aircraft
  Aircraft Type
    
    Owned(1)
    
    Leased
    
    Payload(2)
    
    Range(3)
    
    Speed(4)Aircraft used in operations:Learjet, Model 35/35A
    
    
    30
    
    
    
    
    
    
    
    3,800
    
    
    
    1,700
    
    
    
    440Cessna Caravan
    
    
    7
    
    
    
    7
    
    
    
    3,400
    
    
    
    825
    
    
    
    170Beech Baron
    
    
    40
    
    
    
    
    
    
    
    1,000
    
    
    
    800
    
    
    
    170Piper Navajo
    
    
    17
    
    
    
    
    
    
    
    1,500
    
    
    
    800
    
    
    
    170Total used in operations
    
    
    94
    
    
    
    7Aircraft held for sale:Cessna 310
    
    
    9
    
    
    
    
    
    
    
    900
    
    
    
    800
    
    
    
    170Total aircraft
    
    
    103
    
    
    
    7
 
 (1)
    
    In January 2007, a Learjet 35 was damaged and removed from AirNets
aircraft fleet, which decreased the total number of owned Learjets to 29.(2)
    
    Maximum payload in pounds for a one-hour flight plus required fuel
reserves.(3)
    
    Maximum range in nautical miles, assuming zero wind, full fuel and maximum
payload.(4)
    
    Maximum speed in knots, assuming maximum payload.    Vehicles
  
 ITEM 3  LEGAL PROCEEDINGS
  14




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ITEM 4  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 PART II
 
 ITEM 5  MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
  2006
    
    2005Quarter ended
    
    High
    
    Low
    
    High
    
    LowMarch 31
    
    $
    3.76
    
    
    $
    3.17
    
    
    $
    4.75
    
    
    $
    3.31June 30
    
    
    3.60
    
    
    
    2.82
    
    
    
    5.19
    
    
    
    3.71September 30
    
    
    3.84
    
    
    
    2.80
    
    
    
    5.44
    
    
    
    3.91December 31
    
    
    3.92
    
    
    
    2.91
    
    
    
    5.36
    
    
    
    3.22
     15




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ITEM 6  SELECTED FINANCIAL DATA
 Statement of Operations Data(in thousands, except per share data)
    
    Year Ended December 31,2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002Net Revenues, net of excise taxBank Services
    
    $
    112,034
    
    
    $
    113,748
    
    
    $
    106,117
    
    
    $
    103,399
    
    
    $
    102,626Express Services
    
    
    59,187
    
    
    
    52,346
    
    
    
    49,096
    
    
    
    36,963
    
    
    
    33,958Aviation Services
    
    
    1,586
    
    
    
    865
    
    
    
    1,243
    
    
    
    1,261
    
    
    
    1,044Total net revenues
    
    
    172,807
    
    
    
    166,959
    
    
    
    156,456
    
    
    
    141,623
    
    
    
    137,628Costs and ExpensesOperating costs and expenses
    
    
    158,382
    
    
    
    155,893
    
    
    
    152,917
    
    
    
    136,659
    
    
    
    130,268Impairment charges (Notes 1, 2, and 3)
    
    
    24,560
    
    
    
    16,073
    
    
    
    47,009
    
    
    
    
    
    
    
    Total costs and expenses
    
    
    182,942
    
    
    
    171,966
    
    
    
    199,926
    
    
    
    136,659
    
    
    
    130,268Income (loss) from continuing operations
before income taxes
    
    
    (10,135
    )
    
    
    (5,007
    )
    
    
    (43,470
    )
    
    
    4,964
    
    
    
    7,360Interest expense
    
    
    1,532
    
    
    
    2,107
    
    
    
    1,228
    
    
    
    1,337
    
    
    
    948Income (loss) from continuing operations
before income taxes and cumulative effect
of accounting change
    
    
    (11,667
    )
    
    
    (7,114
    )
    
    
    (44,698
    )
    
    
    3,627
    
    
    
    6,412Provision (benefit) for income taxes
    
    
    1,654
    
    
    
    (2,400
    )
    
    
    (9,566
    )
    
    
    1,533
    
    
    
    2,480Income (loss) from continuing operations before
cumulative effect of accounting change
    
    
    (13,321
    )
    
    
    (4,714
    )
    
    
    (35,132
    )
    
    
    2,094
    
    
    
    3,932Income (loss) from discontinued operations,
net of taxes (Notes 4 and 5)
    
    
    29
    
    
    
    468
    
    
    
    986
    
    
    
    686
    
    
    
    (561
    )Cumulative effect of accounting change, net of
tax benefit (Note 6)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,868
    )Net income (loss)
    
    $
    (13,292
    )
    
    $
    (4,246
    )
    
    $
    (34,146
    )
    
    $
    2,780
    
    
    $
    1,503Income (loss) per common share  basic and dilutedContinuing operations
    
    $
    (1.31
    )
    
    $
    (0.47
    )
    
    $
    (3.49
    )
    
    $
    0.21
    
    
    $
    0.38Discontinued operations
    
    $
    0.00
    
    
    $
    0.05
    
    
    $
    0.10
    
    
    $
    0.07
    
    
    $
    (0.05
    )Cumulative effect of accounting change
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    (0.18
    )Net income (loss)
    
    $
    (1.31
    )
    
    $
    (0.42
    )
    
    $
    (3.39
    )
    
    $
    0.28
    
    
    $
    0.15Balance Sheet Data
(in thousands)Total assets
    
    $
    56,547
    
    
    $
    123,293
    
    
    $
    137,470
    
    
    $
    153,273
    
    
    $
    147,324Total debt
    
    
    7,955
    
    
    
    56,019
    
    
    
    62,245
    
    
    
    37,776
    
    
    
    41,794Total shareholders equity
    
    
    34,015
    
    
    
    46,379
    
    
    
    50,466
    
    
    
    84,280
    
    
    
    80,796
 Note 1
    
    Represents 2006 charge related to the impairment of AirNets cargo assets (See Note 2  Impairment of Property and Equipment
and Goodwill of the Notes to Consolidated Financial Statements included in ITEM 8  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
of this Annual Report on Form 10-K.)
 Note 2
    
    Represents 2005 charge related to the impairment of AirNets cargo assets (See Note 2  Impairment of Property and Equipment
and Goodwill of the Notes to Consolidated Financial Statements included in ITEM 8  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
of this Annual Report on Form 10-K.)
 Note 3
    
    Represents 2004 charge related to the impairment of AirNets cargo assets and related goodwill (See Note 2  Impairment of
Property and Equipment and Goodwill of the Notes to Consolidated Financial Statements included in ITEM 8  FINANCIAL STATEMENTS
AND SUPPLEMENTARY DATA of this Annual Report on Form 10-K.)
 Note 4
    
    In August 2003, AirNet sold the assets of its Mercury Business Services unit, resulting in discontinued operations.
 Note 5
    
    In September 2006, AirNet sold the assets of its Jetride Passenger Charter Services unit, resulting in discontinued operations, including
a gain on sale of $610, net of tax.
 Note 6
    
    Represents the effect of adopting Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets.
 16




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ITEM 7  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION
 General
   Sale of Jetrides Passenger Charter Business
     17




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Results of Operations
 Financial Overview
   Net Revenues
 Dollars in 000s
 $ Increase
    
    
    % Increase
    
    
    $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)
    
    
    (Decrease)
    
    
    (Decrease)Net Revenues
    
    2006
    
    
    2005
    
    
    2004
    
    
    2005 to 2006
    
    
    2005 to 2006
    
    
    2004 to 2005
    
    
    2004 to 2005Net RevenuesBank Services
    
    $
    112,034
    
    
    $
    113,748
    
    
    $
    106,117
    
    
    $
    (1,714
    )
    
    
    (2
    )%
    
    $
    7,631
    
    
    
    7
    %Express Services
    
    
    59,187
    
    
    
    52,346
    
    
    
    49,096
    
    
    
    6,841
    
    
    
    13
    %
    
    
    3,250
    
    
    
    7
    %Aviation Services
    
    
    1,586
    
    
    
    865
    
    
    
    1,243
    
    
    
    721
    
    
    
    83
    %
    
    
    (378
    )
    
    
    (30
    )%Total Net Revenues
    
    $
    172,807
    
    
    $
    166,959
    
    
    $
    156,456
    
    
    $
    5,848
    
    
    
    4
    %
    
    $
    10,503
    
    
    
    7
    %
    18




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##### Table of Contents



Bank Services Revenues
 Dollars in 000s
 $ Increase
    
    
    % Increase
    
    
    $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)
    
    
    (Decrease)
    
    
    (Decrease)Bank Services Revenues
    
    2006
    
    
    2005
    
    
    2004
    
    
    2005 to 2006
    
    
    2005 to 2006
    
    
    2004 to 2005
    
    
    2004 to 2005Bank Services Revenues
    
    $
    96,773
    
    
    $
    100,963
    
    
    $
    100,059
    
    
    $
    (4,190
    )
    
    
    (4
    )%
    
    $
    904
    
    
    
    1
    %Fuel Surcharge
    
    
    15,261
    
    
    
    12,785
    
    
    
    6,058
    
    
    
    2,476
    
    
    
    19
    %
    
    
    6,727
    
    
    
    111
    %Total Net Bank Services Revenues
    
    $
    112,034
    
    
    $
    113,748
    
    
    $
    106,117
    
    
    $
    (1,714
    )
    
    
    (2
    )%
    
    $
    7,631
    
    
    
    7
    %Revenues before fuel surcharge:Weekday Revenues Per Flying Day
    
    $
    459
    
    
    $
    480
    
    
    $
    473
    
    
    $
    (21
    )
    
    
    (4
    )%
    
    $
    7
    
    
    
    1
    %Weekend Revenues Per Weekend
    
    $
    147
    
    
    $
    151
    
    
    $
    148
    
    
    $
    (4
    )
    
    
    (3
    )%
    
    $
    3
    
    
    
    2
    %
      19




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Express Services Revenues
 Dollars in 000s
 $ Increase
    
    
    % Increase
    
    
    $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)
    
    
    (Decrease)
    
    
    (Decrease)Express Services Revenues
    
    2006
    
    
    2005
    
    
    2004
    
    
    2005 to 2006
    
    
    2005 to 2006
    
    
    2004 to 2005
    
    
    2004 to 2005Express
Revenues Non-Charter
    
    $
    36,542
    
    
    $
    32,776
    
    
    $
    33,829
    
    
    $
    3,766
    
    
    
    11
    %
    
    $
    (1,053
    )
    
    
    (3
    )%Express Revenues  Charters
    
    
    13,829
    
    
    
    13,858
    
    
    
    13,125
    
    
    
    (29
    )
    
    
    0
    %
    
    
    733
    
    
    
    6
    %Fuel Surcharge
    
    
    8,816
    
    
    
    5,712
    
    
    
    2,142
    
    
    
    3,104
    
    
    
    54
    %
    
    
    3,570
    
    
    
    167
    %Total Net Express Services Revenues
    
    $
    59,187
    
    
    $
    52,346
    
    
    $
    49,096
    
    
    $
    6,841
    
    
    
    13
    %
    
    $
    3,250
    
    
    
    7
    %
      20




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Aviation Services
  Costs and Expenses
 Dollars in 000s
 $ Increase
    
    
    % Increase
    
    
    $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)
    
    
    (Decrease)
    
    
    (Decrease)Operating Costs and Expenses
    
    2006
    
    
    2005
    
    
    2004
    
    
    2005 to 2006
    
    
    2005 to 2006
    
    
    2004 to 2005
    
    
    2004 to 2005Aircraft fuel
    
    $
    27,909
    
    
    $
    27,291
    
    
    $
    22,889
    
    
    $
    618
    
    
    
    2
    %
    
    $
    4,402
    
    
    
    19
    %Aircraft maintenance
    
    
    17,998
    
    
    
    16,901
    
    
    
    12,969
    
    
    
    1,097
    
    
    
    6
    %
    
    
    3,932
    
    
    
    30
    %Operating wages and benefits
    
    
    19,071
    
    
    
    19,745
    
    
    
    21,570
    
    
    
    (674
    )
    
    
    (3
    )%
    
    
    (1,825
    )
    
    
    (8
    )%Contracted air costs
    
    
    16,550
    
    
    
    14,415
    
    
    
    13,670
    
    
    
    2,135
    
    
    
    15
    %
    
    
    745
    
    
    
    5
    %Ground courier
    
    
    35,248
    
    
    
    31,557
    
    
    
    30,285
    
    
    
    3,691
    
    
    
    12
    %
    
    
    1,272
    
    
    
    4
    %Depreciation
    
    
    9,700
    
    
    
    12,127
    
    
    
    17,626
    
    
    
    (2,427
    )
    
    
    (20
    )%
    
    
    (5,499
    )
    
    
    (31
    )%Insurance, rent and landing fees
    
    
    8,639
    
    
    
    8,973
    
    
    
    9,207
    
    
    
    (334
    )
    
    
    (4
    )%
    
    
    (234
    )
    
    
    (3
    )%Travel, training and other
    
    
    5,468
    
    
    
    5,550
    
    
    
    6,384
    
    
    
    (82
    )
    
    
    (1
    )%
    
    
    (834
    )
    
    
    (13
    )%Selling, general and administrative
    
    
    17,939
    
    
    
    19,493
    
    
    
    18,283
    
    
    
    (1,554
    )
    
    
    (8
    )%
    
    
    1,210
    
    
    
    7
    %Net (gain) loss on disposition of assets
    
    
    (140
    )
    
    
    (159
    )
    
    
    34
    
    
    
    19
    
    
    
    12
    %
    
    
    (193
    )
    
    
    *Operating costs and expenses before
impairment charges
    
    
    158,382
    
    
    
    155,893
    
    
    
    152,917
    
    
    
    2,489
    
    
    
    2
    %
    
    
    2,976
    
    
    
    2
    %Impairment of property and equipment
    
    
    24,560
    
    
    
    16,073
    
    
    
    42,991
    
    
    
    8,487
    
    
    
    *
    
    
    
    (26,918
    )
    
    
    *Impairment of goodwill
    
    
    
    
    
    
    
    
    
    
    4,018
    
    
    
    
    
    
    
    *
    
    
    
    (4,018
    )
    
    
    *Total Costs and Expenses
    
    $
    182,942
    
    
    $
    171,966
    
    
    $
    199,926
    
    
    $
    10,976
    
    
    
    6
    %
    
    $
    (27,960
    )
    
    
    (14
    )%
 
 *
    
    The percentage increase (decrease) is not meaningful. Increase
    
    % Increase
    
    Increase
    
    % Increase(Decrease)
    
    (Decrease)
    
    (Decrease)
    
    (Decrease)Hours Flown
    
    2006
    
    2005
    
    2004
    
    2005 to 2006
    
    2005 to 2006
    
    2004 to 2005
    
    2004 to 2005AirNet Aircraft Hours Flown  Total
    
    
    84,760
    
    
    
    94,837
    
    
    
    101,250
    
    
    
    (10,077
    )
    
    
    (11
    )%
    
    
    (6,413
    )
    
    
    (6
    )%
 Aircraft Fuel
   21




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##### Table of Contents



Aircraft Maintenance
      Contracted Air Costs
 Dollars in 000s
 Increase
    
    
    % Increase
    
    
    Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)
    
    
    (Decrease)
    
    
    (Decrease)Contracted Air Costs
    
    2006
    
    
    2005
    
    
    2004
    
    
    2005 to 2006
    
    
    2005 to 2006
    
    
    2004 to 2005
    
    
    2004 to 2005Back-up and Subcontracted Air Routes
    
    $
    9,739
    
    
    $
    8,543
    
    
    $
    7,174
    
    
    $
    1,196
    
    
    
    14
    %
    
    $
    1,369
    
    
    
    19
    %Commercial freight
    
    
    6,811
    
    
    
    5,872
    
    
    
    6,496
    
    
    
    939
    
    
    
    16
    %
    
    
    (624
    )
    
    
    (10
    )%Total Contracted Air Costs
    
    $
    16,550
    
    
    $
    14,415
    
    
    $
    13,670
    
    
    $
    2,135
    
    
    
    15
    %
    
    $
    745
    
    
    
    5
    %
   22




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##### Table of Contents



Ground Courier
 Dollars in 000s
 Increase
    
    
    % Increase
    
    
    Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)
    
    
    (Decrease)
    
    
    (Decrease)Ground Courier Costs
    
    2006
    
    
    2005
    
    
    2004
    
    
    2005 to 2006
    
    
    2005 to 2006
    
    
    2004 to 2005
    
    
    2004 to 2005AirNet courier and supervision
    
    $
    3,076
    
    
    $
    4,478
    
    
    $
    6,277
    
    
    $
    (1,402
    )
    
    
    (31
    )%
    
    $
    (1,799
    )
    
    
    (29
    )%Contracted courier:Bank Services
    
    
    14,228
    
    
    
    12,178
    
    
    
    10,632
    
    
    
    2,050
    
    
    
    17
    %
    
    
    1,546
    
    
    
    15
    %Express Services
    
    
    17,944
    
    
    
    14,901
    
    
    
    13,376
    
    
    
    3,043
    
    
    
    20
    %
    
    
    1,525
    
    
    
    11
    %Total Ground Courier Costs
    
    $
    35,248
    
    
    $
    31,557
    
    
    $
    30,285
    
    
    $
    3,691
    
    
    
    12
    %
    
    $
    1,272
    
    
    
    4
    %Bank contracted courier costs as a
percentage of Bank Services revenues,
including fuel surcharge revenues:
    
    
    13
    %
    
    
    11
    %
    
    
    10
    %Express contracted courier costs as a
percentage of Express Services revenues,
including fuel surcharge revenues:
    
    
    30
    %
    
    
    28
    %
    
    
    27
    %
  Depreciation
 Dollars in 000s
 $ Increase
    
    
    % Increase
    
    
    $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)
    
    
    (Decrease)
    
    
    (Decrease)Depreciation Expense
    
    2006
    
    
    2005
    
    
    2004
    
    
    2005 to 2006
    
    
    2005 to 2006
    
    
    2004 to 2005
    
    
    2004 to 2005Aircraft
    
    $
    826
    
    
    $
    1,343
    
    
    $
    2,951
    
    
    $
    (517
    )
    
    
    (38
    )%
    
    $
    (1,608
    )
    
    
    (54
    )%Aircraft improvements,
engines, inspections
    
    
    7,649
    
    
    
    9,491
    
    
    
    13,613
    
    
    
    (1,842
    )
    
    
    (19
    )%
    
    
    (4,122
    )
    
    
    (30
    )%Leasehold improvements, computers,
furniture, fixtures, and equipment
    
    
    1,225
    
    
    
    1,293
    
    
    
    1,062
    
    
    
    (68
    )
    
    
    (5
    )%
    
    
    231
    
    
    
    22
    %Total Depreciation
    
    $
    9,700
    
    
    $
    12,127
    
    
    $
    17,626
    
    
    $
    (2,427
    )
    
    
    (20
    )%
    
    $
    (5,499
    )
    
    
    (31
    )%
  Insurance, Rent and Landing Fees
  23




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##### Table of Contents



Selling, General and Administrative
   Impairment Charges
 Accounting for the Impairment or Disposal of Long-Lived
Assets
 2006 Asset Impairment Charge
    24




---



##### Table of Contents



2005 Asset Impairment Charge
  2004 Asset Impairment Charge
   Interest Expense
 Dollars in 000s
 Increase
    
    % Increase
    
    Increase
    
    % Increase(Decrease)
    
    (Decrease)
    
    (Decrease)
    
    (Decrease)2006
    
    2005
    
    2004
    
    2005 to 2006
    
    2005 to 2006
    
    2004 to 2005
    2004 to 2005Interest expense
    
    $
    1,532
    
    
    $
    2,107
    
    
    $
    1,228
    
    
    $
    (575
    )
    
    
    (27
    )%
    
    $
    879
    
    
    
    72
    %Average annual interest rate
    
    
    7.8
    %
    
    
    6.2
    %
    
    
    5.5
    %
  25




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##### Table of Contents



Income Taxes
 Dollars in 000s
 Increase
    
    % Increase
    
    Increase
    
    % Increase(Decrease)
    
    (Decrease)
    
    (Decrease)
    
    (Decrease)2006
    
    2005
    
    2004
    
    2005 to 2006
    
    2005 to 2006
    
    2004 to 2005
    
    2004 to 2005Income (loss) from continuing operations
before income taxes
    
    $
    (11,667
    )
    
    $
    (7,114
    )
    
    $
    (44,698
    )
    
    $
    (4,552
    )
    
    
    (64
    )%
    
    $
    37,583
    
    
    
    84
    %Provision (benefit) for income taxes
    
    
    1,654
    
    
    
    (2,400
    )
    
    
    (9,566
    )
    
    
    (4,054
    )
    
    
    169
    %
    
    
    7,166
    
    
    
    75
    %Effective Income Tax Rate
    
    
    (14.2
    )%
    
    
    33.7
    %
    
    
    21.4
    %
    Accounting for Income Taxes
 26




---



##### Table of Contents



Net Income (Loss) and Earnings (Loss) Per Common Share
  Dollars in 000s
 Increase
    
    
    % Increase
    
    
    Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)
    
    
    (Decrease)
    
    
    (Decrease)2006
    
    
    2005
    
    
    2004
    
    
    2005 to 2006
    
    
    2005 to 2006
    
    
    2004 to 2005
    
    
    2004 to 2005Income (loss) from continuing operations
before income taxes
    
    $
    (11,667
    )
    
    $
    (7,114
    )
    
    $
    (44,698
    )
    
    $
    (4,553
    )
    
    
    (64
    )%
    
    $
    37,584
    
    
    
    84
    %Provision (benefit) for income taxes
    
    
    1,654
    
    
    
    (2,400
    )
    
    
    (9,566
    )
    
    
    (4,054
    )
    
    
    (169
    )%
    
    
    7,166
    
    
    
    75
    %Income from discontinued operations
    
    
    29
    
    
    
    468
    
    
    
    986
    
    
    
    (439
    )
    
    
    (94
    )%
    
    
    (518
    )
    
    
    (53
    )%Net Income (Loss)
    
    $
    (13,292
    )
    
    $
    (4,246
    )
    
    $
    (34,146
    )
    
    $
    (9,046
    )
    
    
    (213
    )%
    
    $
    29,900
    
    
    
    88
    %Number of common shares outstanding:Basic
    
    
    10,158
    
    
    
    10,133
    
    
    
    10,080
    
    
    
    25
    
    
    
    0
    %
    
    
    53
    
    
    
    1
    %Diluted
    
    
    10,158
    
    
    
    10,153
    
    
    
    10,099
    
    
    
    5
    
    
    
    0
    %
    
    
    54
    
    
    
    1
    %Net income (loss) per common share -
basic and diluted:Continuing operations
    
    $
    (1.31
    )
    
    $
    (0.47
    )
    
    $
    (3.49
    )Discontinued operations
    
    
    
    
    
    
    0.05
    
    
    
    0.10Net income (loss) per common share
    
    $
    (1.31
    )
    
    $
    (0.42
    )
    
    $
    (3.39
    )
 Liquidity and Capital Resources
 Cash flow from operating activities  Continuing Operations
  Cash flow from operating activities  Discontinued Operations
  Financing Activities  Continuing Operations
  Payments Due by PeriodLess than
    
    1-3
    
    3-5
    
    More than 5Total
    
    1 year
    
    years
    
    years
    
    yearsContractual Obligations:Long-Term Debt
    
    $
    8.0
    
    
    $
    2.0
    
    
    $
    6.0
    
    
    $
    0.0
    
    
    $
    0.0Operating Leases
    
    
    2.6
    
    
    
    0.7
    
    
    
    0.2
    
    
    
    0.2
    
    
    
    1.5Other Purchase and Payment Obligations
    
    
    7.2
    
    
    
    7.2
    
    
    
    0.0
    
    
    
    0.0
    
    
    
    0.0Total Contractual Cash Obligations
    
    $
    17.8
    
    
    $
    9.9
    
    
    $
    6.2
    
    
    $
    0.2
    
    
    $
    1.5
  27




---



##### Table of Contents



Revolving Credit Facility  2002 through 2006
        28




---



##### Table of Contents



Revolving
Credit Facility  Second Amended Credit Agreement  March 29, 2007
    Other Term Notes
  Financing Activities  Discontinued Operations
  Investing Activities  Continuing Operations
  2007
    
    
    2006
    
    
    2005
    
    
    2004Continuing Operations:Aircraft
    
    $
    0.0
    
    
    $
    0.0
    
    
    $
    0.0
    
    
    $
    0.0Aircraft improvements, engines and inspections
    
    
    4.9-5.7
    
    
    
    8.0
    
    
    
    10.3
    
    
    
    17.5Rickenbacker Facility, technology and other
    
    
    0.6-0.8
    
    
    
    0.1
    
    
    
    5.2
    
    
    
    8.0Total continuing operations
    
    
    5.5-6.5
    
    
    
    8.1
    
    
    
    15.5
    
    
    
    25.5Discontinued operations
    
    
    0.0
    
    
    
    1.1
    
    
    
    2.2
    
    
    
    25.7Total
    
    $
    5.5-6.5
    
    
    $
    9.2
    
    
    $
    17.7
    
    
    $
    51.2
  29




---



##### Table of Contents



Investing Activities  Discontinued Operations
  Off-Balance Sheet Arrangements
  Seasonality and Variability in Quarterly Results
   30




---



##### Table of Contents



Selected Quarterly Data (unaudited)
  Quarter EndedMarch 31
    
    
    June 30
    
    
    September 30
    
    
    December 312006Net revenues
    
    $
    42,705
    
    
    $
    44,354
    
    
    $
    42,987
    
    
    $
    42,761Income (loss) from continuing operations before income taxes
    
    
    3,017
    
    
    
    3,211
    
    
    
    (20,741
    )
    
    
    2,846Income (loss) from discontinued operations, net of tax
    
    
    (209
    )
    
    
    (87
    )
    
    
    313
    
    
    
    12Net income (loss)
    
    $
    1,687
    
    
    $
    1,978
    
    
    $
    (18,736
    )
    
    $
    1,779Per common share  basic and diluted:Income (loss) from continuing operations
    
    $
    0.19
    
    
    $
    0.20
    
    
    $
    (1.88
    )
    
    $
    0.18Income (loss) from discontinued operations, net of tax
    
    
    (0.02
    )
    
    
    (0.01
    )
    
    
    0.03
    
    
    
    Net income (loss) per common share
    
    $
    0.17
    
    
    $
    0.19
    
    
    $
    (1.85
    )
    
    $
    0.182005Net revenues
    
    $
    40,565
    
    
    $
    41,390
    
    
    $
    42,848
    
    
    $
    42,156Income (loss) from continuing operations before income taxes
    
    
    1,966
    
    
    
    2,056
    
    
    
    (12,438
    )
    
    
    1,302Income (loss) from discontinued operations, net of tax
    
    
    523
    
    
    
    562
    
    
    
    (158
    )
    
    
    (459
    )Net income (loss)
    
    $
    1,517
    
    
    $
    2,054
    
    
    $
    (7,933
    )
    
    $
    116Per common share  basic and diluted:Income (loss) from continuing operations
    
    $
    0.10
    
    
    $
    0.15
    
    
    $
    (0.78
    )
    
    $
    0.06Income (loss) from discontinued operations, net of tax
    
    $
    0.05
    
    
    $
    0.05
    
    
    $
    
    
    
    $
    (0.05
    )Net income (loss) per common share
    
    $
    0.15
    
    
    $
    0.20
    
    
    $
    (0.78
    )
    
    $
    0.01
   Critical Accounting Policies and Estimates
   Allowance for Uncollectible Accounts Receivable
  31




---



##### Table of Contents



Major Aircraft Maintenance
  Property and Equipment
   Stock-Based Compensation
 Accounting for Stock Issued to Employees, Accounting for Stock-Based
Compensation Share-Based Payment
   32




---



##### Table of Contents



Self-Insurance Accruals
   Incentive Compensation Plans
  Income Taxes
    Impairment of Assets and Goodwill
  2006 Asset Impairment Charge
  33




---



##### Table of Contents



2005 Asset Impairment Charge
  2004 Asset Impairment Charge
   34




---



##### Table of Contents



Recent Accounting Pronouncements
 Accounting for Uncertainty in Income
Taxes  an Interpretation of FASB Statement No. 109
 , Considering the Effects of
Prior Year Misstatements When Quantifying Misstatements in Current Year Financial Statements
 Forward-looking statements
  
    
    an acceleration in the migration of AirNets Bank Services customers to electronic
alternatives to the physical movement of cancelled checks;
    
    potential regulatory changes by the FAA, DOT and TSA, which could increase the
regulation of AirNets business, or the Federal Reserve, which could change the
competitive environment of transporting canceled checks;
    
    disruptions to the Internet or AirNets technology infrastructure, including those
impacting AirNets computer systems and Web site;
    
    disruptions to operations due to adverse weather conditions, air traffic
control-related constraints or aircraft accidents;
    
    potential further declines in the value of aircraft in AirNets fleet and any related asset impairment charges;
    
    potential changes in locally and federally mandated security requirements;
    
    the impact of intense competition on AirNets ability to maintain or increase its
prices for Express Services (including fuel surcharges in response to rising fuel
costs);
    
    increases in aviation fuel costs not fully offset by AirNets fuel surcharge program;
    
    changes in check processing and shipment patterns of bank customers;
    
    acts of war and terrorist activities;
    
    AirNets ability to reduce its cost structure to match declining revenues and operating expenses;
 35




---



##### Table of Contents




    
    the impact of prolonged weakness in the United States economy on time-critical shipment volumes;
    
    the acceptance of AirNets time-critical service offerings within targeted Express markets;
    
    technological advances and increases in the use of electronic funds transfers;
    
    the availability and cost of financing required for operations;
    
    significant changes in the volumes of shipments transported on AirNets air
transportation network, customer demand for AirNets various services or the prices it
obtains for its services;
    
    the impact of unusual items resulting from ongoing evaluations of our business strategies;
    
    any substantial indebtedness that may be incurred by AirNet;
    
    insufficient capital for future expansion; and
    
    other economic, competitive and domestic and foreign governmental factors affecting
AirNets markets, prices and other facets of its operations.
  
 ITEM 7A  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Inflation and Interest Rates
   Fuel Surcharge
 
 36




---



##### Table of Contents



ITEM 8  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 Report of Independent Registered Public Accounting Firm
 
    
 37




---



##### Table of Contents



AIRNET SYSTEMS, INC.
 CONSOLIDATED BALANCE SHEETS
 December 31,In thousands, except par value data
    
    2006
    
    
    2005ASSETSCurrent assets:Cash and cash equivalents
    
    $
    2,244
    
    
    $
    1,590Accounts receivable, less allowances
    
    
    22,345
    
    
    
    21,103Taxes receivable
    
    
    
    
    
    
    1,786Deposits and prepaids
    
    
    2,463
    
    
    
    2,338Assets related to discontinued operations
    
    
    1,465
    
    
    
    42,231Assets held for sale
    
    
    280
    
    
    
    328Total current assets
    
    
    28,797
    
    
    
    69,376Net property and equipment
    
    
    27,690
    
    
    
    53,763Deposits and other assets
    
    
    60
    
    
    
    154Total assets
    
    $
    56,547
    
    
    $
    123,293LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued expenses
    
    $
    8,876
    
    
    $
    10,037Salaries and related liabilities
    
    
    4,716
    
    
    
    4,719Current portion of notes payable
    
    
    1,944
    
    
    
    1,781Taxes payable
    
    
    935
    
    
    
    Deferred income taxes
    
    
    
    
    
    
    124Notes payable related to discontinued operations
    
    
    
    
    
    
    29,780Other liabilities related to discontinued operations
    
    
    50
    
    
    
    704Total current liabilities
    
    
    16,521
    
    
    
    47,145Notes payable, less current portion
    
    
    6,011
    
    
    
    24,458Deferred income taxes
    
    
    
    
    
    
    5,311Shareholders equity:Preferred shares, $.01 par value; 10,000 shares authorized; no
shares issued and outstanding
    
    
    
    
    
    
    Common shares, $.01 par value; 40,000 shares authorized; 12,763
issued at December 31, 2006 and December 31, 2005, respectively
    
    
    128
    
    
    
    128Additional paid-in-capital
    
    
    76,906
    
    
    
    76,318Retained deficit
    
    
    (19,746
    )
    
    
    (6,454
    )Accumulated other comprehensive loss
    
    
    (13
    )
    
    
    (13
    )Treasury
shares, 2,598and 2,614 common shares held at cost at December 31, 2006 and December 31, 2005, respectively
    
    
    (23,260
    )
    
    
    (23,600
    )Total shareholders equity
    
    
    34,015
    
    
    
    46,379Total liabilities and shareholders equity
    
    $
    56,547
    
    
    $
    123,293
  38




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##### Table of Contents



AIRNET SYSTEMS, INC.
 CONSOLIDATED STATEMENTS OF OPERATIONS
 Year Ended December 31,In thousands, except per share data
    
    2006
    
    
    2005
    
    
    2004NET REVENUES, NET OF EXCISE TAXAir Transportation, net of excise tax of $3,729, $4,054, $3,997 for
the years ended December 31, 2006, 2005, 2004, respectively:Bank Services
    
    $
    112,034
    
    
    $
    113,748
    
    
    $
    106,117Express Services
    
    
    59,187
    
    
    
    52,346
    
    
    
    49,096Aviation Services
    
    
    1,586
    
    
    
    865
    
    
    
    1,243Total net revenues
    
    
    172,807
    
    
    
    166,959
    
    
    
    156,456COSTS AND EXPENSESAircraft fuel
    
    
    27,909
    
    
    
    27,291
    
    
    
    22,889Aircraft maintenance
    
    
    17,998
    
    
    
    16,901
    
    
    
    12,969Operating wages and benefits
    
    
    19,071
    
    
    
    19,745
    
    
    
    21,570Contracted air costs
    
    
    16,550
    
    
    
    14,415
    
    
    
    13,670Ground courier
    
    
    35,248
    
    
    
    31,557
    
    
    
    30,285Depreciation
    
    
    9,700
    
    
    
    12,127
    
    
    
    17,626Insurance, rent and landing fees
    
    
    8,639
    
    
    
    8,973
    
    
    
    9,207Travel, training and other
    
    
    5,468
    
    
    
    5,550
    
    
    
    6,384Selling, general and administrative
    
    
    17,939
    
    
    
    19,493
    
    
    
    18,283Net (gain) loss on disposition of assets
    
    
    (140
    )
    
    
    (159
    )
    
    
    34Impairment of assets
    
    
    24,560
    
    
    
    16,073
    
    
    
    47,009Total costs and expenses
    
    
    182,942
    
    
    
    171,966
    
    
    
    199,926Income (loss) from continuing operations before interest and income taxes
    
    
    (10,135
    )
    
    
    (5,007
    )
    
    
    (43,470
    )Interest expense
    
    
    1,532
    
    
    
    2,107
    
    
    
    1,228Income (loss) from continuing operations before income taxes
    
    
    (11,667
    )
    
    
    (7,114
    )
    
    
    (44,698
    )Provision (Benefit) for income taxes
    
    
    1,654
    
    
    
    (2,400
    )
    
    
    (9,566
    )Net income (loss) from continuing operations
    
    
    (13,321
    )
    
    
    (4,714
    )
    
    
    (35,132
    )Income from discontinued operations
(including 2006 gain on sale of $610, net of tax)
    
    
    29
    
    
    
    468
    
    
    
    986Net income (loss)
    
    $
    (13,292
    )
    
    $
    (4,246
    )
    
    $
    (34,146
    )Income (loss) per common share  basic and diluted:Continuing operations
    
    $
    (1.31
    )
    
    $
    (0.47
    )
    
    $
    (3.49
    )Discontinued operations
    
    
    0.00
    
    
    
    0.05
    
    
    
    0.10Net income (loss) per common share  basic and diluted
    
    $
    (1.31
    )
    
    $
    (0.42
    )
    
    $
    (3.39
    )
  39




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##### Table of Contents



AIRNET SYSTEMS, INC.
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 Year Ended December 31,In thousands
    
    2006
    
    
    2005
    
    
    2004Operating activities:Net loss from continuing operations
    
    $
    (13,321
    )
    
    $
    (4,714
    )
    
    $
    (35,132
    )Adjustments to reconcile net loss from continuing operations to net cash
provided by operating activities:Depreciation
    
    
    9,700
    
    
    
    12,127
    
    
    
    17,626Impairment of assets
    
    
    24,560
    
    
    
    16,073
    
    
    
    47,009Deferred income taxes
    
    
    (5,311
    )
    
    
    (1,957
    )
    
    
    (14,826
    )Stock-based compensation expense
    
    
    246
    
    
    
    Other, net
    
    
    (140
    )
    
    
    (71
    )
    
    
    557Cash provided by (used in) operating assets and liabilities:Accounts receivable
    
    
    (1,242
    )
    
    
    (455
    )
    
    
    (3,907
    )Taxes receivable or payable
    
    
    2,721
    
    
    
    (652
    )
    
    
    5,702Deposits and prepaids
    
    
    (125
    )
    
    
    647
    
    
    
    367Accounts payable and accrued expenses
    
    
    (1,161
    )
    
    
    (1,311
    )
    
    
    2,646Salaries and related liabilities
    
    
    (3
    )
    
    
    369
    
    
    
    (503
    )Other, net
    
    
    (124
    )
    
    
    208
    
    
    
    120Net cash provided by continuing operations
    
    
    15,800
    
    
    
    20,264
    
    
    
    19,659Net cash provided by discontinued operations
    
    
    3,038
    
    
    
    4,261
    
    
    
    774Net cash provided by operating activities
    
    
    18,838
    
    
    
    24,525
    
    
    
    20,433Investing activities:Purchases of property and equipment   net
    
    
    (8,060
    )
    
    
    (15,494
    )
    
    
    (25,460
    )Proceeds from sales of property and equipment  net
    
    
    155
    
    
    
    260
    
    
    
    6,961Net cash used in continuing operations
    
    
    (7,905
    )
    
    
    (15,234
    )
    
    
    (18,499
    )Net cash provided by (used in) discontinued operations
    
    
    37,103
    
    
    
    (2,221
    )
    
    
    (25,754
    )Net cash provided by (used in) investing activities
    
    
    29,198
    
    
    
    (17,455
    )
    
    
    (44,253
    )Financing activities:Proceeds from incentive stock plan programs
    
    
    340
    
    
    
    134
    
    
    
    153Net borrowings (repayments) of revolving credit facilities
    
    
    (16,500
    )
    
    
    (3,000
    )
    
    
    700Borrowings under term loans
    
    
    
    
    
    
    11,000
    
    
    
    835Repayments of term loans
    
    
    (1,784
    )
    
    
    (13,011
    )
    
    
    (8,730
    )Other  net
    
    
    342
    
    
    
    198
    
    
    
    158Net cash provided by (used in) continuing operations
    
    
    (17,602
    )
    
    
    (4,679
    )
    
    
    (6,884
    )Net cash provided by (used in) discontinued operations
    
    
    (29,780
    )
    
    
    (1,887
    )
    
    
    31,665Net cash provided by (used in) financing activities
    
    
    (47,382
    )
    
    
    (6,566
    )
    
    
    24,781Net increase in cash
    
    
    654
    
    
    
    504
    
    
    
    961Cash and cash equivalents at beginning of period
    
    
    1,590
    
    
    
    1,086
    
    
    
    125Cash and cash equivalents at end of period
    
    $
    2,244
    
    
    $
    1,590
    
    
    $
    1,086
  40




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##### Table of Contents



AIRNET SYSTEMS, INC.
 CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
 AccumulatedCommon Shares
    
    
    Additional
    
    
    
    
    
    
    OtherNumber
    
    
    
    
    
    
    Paid-in
    
    
    Retained
    
    
    Comprehensive
    
    
    TreasuryIn thousands
    
    of Shares
    
    
    Amount
    
    
    Capital
    
    
    Earnings
    
    
    Loss
    
    
    Shares
    
    
    TotalBalance December 31, 2003
    
    
    12,763
    
    
    $
    128
    
    
    $
    77,759
    
    
    $
    31,938
    
    
    
    ($35
    )
    
    $
    (25,510
    )
    
    $
    84,280Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (34,146
    )
    
    
    
    
    
    
    
    
    
    
    (34,146
    )Gain on derivative instruments,
net of $19 tax expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22
    
    
    
    
    
    
    
    22Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (34,124
    )Issuance of treasury shares -
Associate Stock Purchase Program
    
    
    
    
    
    
    
    
    
    
    (411
    )
    
    
    
    
    
    
    
    
    
    
    566
    
    
    
    155Stock option exercises
    
    
    
    
    
    
    
    
    
    
    (513
    )
    
    
    
    
    
    
    
    
    
    
    668
    
    
    
    155Balance December 31, 2004
    
    
    12,763
    
    
    $
    128
    
    
    $
    76,835
    
    
    
    ($2,208
    )
    
    
    ($13
    )
    
    $
    (24,276
    )
    
    $
    50,466Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,246
    )
    
    
    
    
    
    
    
    
    
    
    (4,246
    )Issuance of treasury shares -
Associate Stock Purchase Program
    
    
    
    
    
    
    
    
    
    
    (361
    )
    
    
    
    
    
    
    
    
    
    
    474
    
    
    
    113Stock option exercises
    
    
    
    
    
    
    
    
    
    
    (156
    )
    
    
    
    
    
    
    
    
    
    
    202
    
    
    
    46Balance December 31, 2005
    
    
    12,763
    
    
    $
    128
    
    
    $
    76,318
    
    
    
    ($6,454
    )
    
    
    ($13
    )
    
    $
    (23,600
    )
    
    $
    46,379Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,292
    )
    
    
    
    
    
    
    
    
    
    
    (13,292
    )Issuance of treasury shares -
Associate Stock Purchase Program
    
    
    
    
    
    
    
    
    
    
    (277
    )
    
    
    
    
    
    
    
    
    
    
    340
    
    
    
    63Stock option vesting
    
    
    
    
    
    
    
    
    
    
    246
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    246Tax benefit from Wright warrants
    
    
    
    
    
    
    
    
    
    
    619
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    619Balance December 31, 2006
    
    
    12,763
    
    
    $
    128
    
    
    $
    76,906
    
    
    
    ($19,746
    )
    
    
    ($13
    )
    
    $
    (23,260
    )
    
    $
    34,015
  41




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 1. Significant Accounting Policies
   Basis of Presentation
    Revenue Recognition
  Cash and Cash Equivalents
  Accounts Receivable
  Property and Equipment
  Airframes
    
    15 yearsLeasehold improvements
    
    20 yearsOther flight equipment
    
    2  5 yearsOther property and equipment
    
    3  10 years
   42




---



##### Table of Contents



2006
    
    
    2005Flight equipment
    
    $
    15,507,000
    
    
    $
    35,316,000Other property and equipment
    
    
    16,990,000
    
    
    
    32,006,00032,497,000
    
    
    
    67,322,000Less accumulated depreciation
    
    
    4,807,000
    
    
    
    13,559,000Net property and equipment
    
    $
    27,690,000
    
    
    $
    53,763,000
 Accounting for the Impairment or Disposal of Long-Lived
Assets
 Self-Insurance Accruals
  Incentive Compensation Plans
  Income Taxes
 Accounting
for Income Taxes.
  Goodwill
 Goodwill and Other Intangible Assets
 43




---



##### Table of Contents



Financial Instruments
  Derivatives
   Accounting for Derivative Instruments
and Hedging Activities
 Stock-Based Compensation
 Accounting for Stock Issued to Employees, Accounting for Stock-Based Compensation Share-Based Payment
   44




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##### Table of Contents



Impact of the Adoption of FAS 123(R)
   2005
    
    
    2004Income (loss) from continuing operations
    
    $
    (4,715
    )
    
    $
    (35,132
    )Income (loss) from discontinued operations, net of tax
    
    
    468
    
    
    
    986Net income (loss), as reported
    
    $
    (4,247
    )
    
    $
    (34,146
    )Deduct: Total stock-based employee and director compensation expense
determined under fair value method for all awards, net of related tax
effects
    
    
    (118
    )
    
    
    (185
    )Pro forma net income (loss)
    
    $
    (4,365
    )
    
    $
    (34,331
    )Net income (loss) per common share  basic and diluted:Income (loss) per common share from continuing operations
    
    $
    (0.48
    )
    
    $
    (3.50
    )Income (loss) per common share from discontinued operations, net of tax
    
    $
    0.05
    
    
    $
    0.10Net income (loss) per common share
    
    $
    (0.43
    )
    
    $
    (3.40
    )
 Recent Accounting Pronouncements
 Accounting for Uncertainty in Income
Taxes  an Interpretation of FASB Statement No. 109
 ,
Considering the Effects of Prior Year Misstatements When Quantifying Misstatements in Current Year
Financial Statements
 Supplemental Cash Flow Data
  2. Impairment of Property and Equipment and Goodwill
 Accounting for the Impairment or Disposal of Long-Lived Assets
 45




---



##### Table of Contents



2006 Asset Impairment Charge
    2005 Asset Impairment Charge
  2004 Asset Impairment Charge
  46




---



##### Table of Contents



3. Discontinued Operations
     4. Notes Payable
  2006
    
    
    2005Term notes
    
    $
    7,955,000
    
    
    $
    9,739,000Revolving credit facility
    
    
    
    
    
    
    16,500,0007,955,000
    
    
    
    26,239,000Current portion of notes payable
    
    
    1,944,000
    
    
    
    1,781,000Long-term portion of notes payable
    
    $
    6,011,000
    
    
    $
    24,458,000
 47




---



##### Table of Contents



Revolving Credit Facility  2002 through 2006
        Revolving
Credit Facility  Second Amended Credit Agreement  March 29, 2007
  48




---



##### Table of Contents



Other Term Notes
  Term Loans  Discontinued Operations
   2007
    
    $
    1,944,0002008
    
    
    6,011,0002009
    
    
    2010
    
    
    2011
    
    
    Thereafter
    
    
    $
    7,955,000
  5. Incentive Stock Plans
  49




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##### Table of Contents



2006
    
    2005
    
    2004Risk free interest rate
    
    
    4.91
    %
    
    
    4.04
    %
    
    
    4.83
    %Volatility factor of expected market price
of AirNets common shares
    
    
    50.0
    %
    
    
    53.6
    %
    
    
    48.8
    %Weighted average expected life
of stock options (years)
    
    
    5.49
    
    
    
    4.92
    
    
    
    4.59
   2006
    
    2005
    
    2004Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    Average
    
    
    
    
    
    AverageCommon
    
    Exercise
    
    Common
    
    Exercise
    
    Common
    
    ExerciseShares
    
    Price
    
    Shares
    
    Price
    
    Shares
    
    PriceOutstanding at beginning of
period
    
    
    886
    
    
    $
    7.71
    
    
    
    1,008
    
    
    $
    7.99
    
    
    
    1,014
    
    
    $
    8.52Granted
    
    
    150
    
    
    
    2.95
    
    
    
    40
    
    
    
    4.26
    
    
    
    206
    
    
    
    4.11Exercised
    
    
    
    
    
    
    
    
    
    
    (12
    )
    
    
    3.96
    
    
    
    (41
    )
    
    
    3.79Cancelled
    
    
    (208
    )
    
    
    9.35
    
    
    
    (150
    )
    
    
    8.95
    
    
    
    (171
    )
    
    
    7.56Outstanding at end of period
    
    
    828
    
    
    
    6.43
    
    
    
    886
    
    
    
    7.71
    
    
    
    1,008
    
    
    
    7.99Options exercisable at end of
period
    
    
    676
    
    
    $
    7.07
    
    
    
    716
    
    
    $
    8.48
    
    
    
    747
    
    
    $
    9.20
   50




---



##### Table of Contents



Stock Options Outstanding
    
    Stock Options ExercisableWeighted-Average
    
    Weighted-Number of
    
    Remaining
    
    Average
    
    Number of
    
    Weighted-Range of Exercise
    
    Stock
    
    Contractual Life
    
    Exercise
    
    Stock
    
    AveragePrices
    
    Options
    
    (Years)
    
    Price
    
    Options
    
    Exercise PriceLess than $5.00
    
    
    484
    
    
    
    6.7
    
    
    $
    3.78
    
    
    
    332
    
    
    $
    3.86$5.01-$10.00
    
    
    263
    
    
    
    1.8
    
    
    
    8.49
    
    
    
    263
    
    
    
    8.49$10.01-$15.00
    
    
    45
    
    
    
    0.3
    
    
    
    14.27
    
    
    
    45
    
    
    
    14.27$15.01-$20.00
    
    
    35
    
    
    
    1.6
    
    
    
    17.50
    
    
    
    35
    
    
    
    17.50$20.01-$25.00
    
    
    1
    
    
    
    1.4
    
    
    
    22.00
    
    
    
    1
    
    
    
    22.00828
    
    
    
    4.6
    
    
    $
    6.43
    
    
    
    676
    
    
    $
    7.07
  6. Lease Obligations
     7. Retirement Plan
  51




---



##### Table of Contents



8. Income Taxes
  2006
    
    
    2005
    
    
    2004Current:Federal
    
    $
    5,865,000
    
    
    $
    
    
    
    $
    State and local
    
    
    625,000
    
    
    
    175,000
    
    
    
    195,0006,490,000
    
    
    
    175,000
    
    
    
    195,000Deferred:Federal
    
    
    (3,481,000
    )
    
    
    (2,042,000
    )
    
    
    (8,518,000
    )State and local
    
    
    (1,336,000
    )
    
    
    (233,000
    )
    
    
    (612,000
    )(4,817,000
    )
    
    
    (2,275,000
    )
    
    
    (9,130,000
    )$
    1,673,000
    
    
    $
    (2,100,000
    )
    
    $
    (8,935,000
    )
  2006
    
    
    2005Long-term deferred tax asset:Alternative minimum tax credit carry forwards
    
    $
    763,000
    
    
    $
    2,500,000Net operating loss carry forward
    
    
    783,000
    
    
    
    3,800,000Other
    
    
    128,000
    
    
    
    136,000Valuation allowance
    
    
    (12,408,000
    )
    
    
    (6,300,000
    )Property and equipment
    
    
    10,625,000
    
    
    
    0Long-term deferred tax liabilities:Property and equipment
    
    
    0
    
    
    
    (4,712,000
    )Other
    
    
    109,000
    
    
    
    (735,000
    )Net long-term deferred tax liabilities
    
    $
    0
    
    
    $
    (5,311,000
    )Current deferred tax assets:Workers compensation reserves
    
    $
    195,000
    
    
    $
    331,000Allowance for bad debt reserves
    
    
    351,000
    
    
    
    283,000Other
    
    
    156,000
    
    
    
    48,000Total current deferred tax assets
    
    
    702,000
    
    
    
    662,000Current deferred tax liabilities:Prepaid expenses
    
    
    (618,000
    )
    
    
    (762,000
    )Other
    
    
    (25,000
    )
    
    
    (24,000
    )Valuation allowance
    
    
    (59,000
    )
    
    
    0Total current deferred tax liabilities
    
    
    (702,000
    )
    
    
    (786,000
    )Net current deferred tax assets (liabilities)
    
    $
    0
    
    
    
    ($124,000
    )
  2006
    
    2005
    
    2004Tax expense (benefit) at federal statutory
rate on pre-tax (loss) income
    
    $
    (3,950,000
    )
    
    
    34.0
    %
    
    $
    (2,158,000
    )
    
    
    34.0
    %
    
    $
    (14,648,000
    )
    
    
    34.0
    %State taxes, net of federal benefit
    
    
    (492,000
    )
    
    
    4.2
    
    
    
    (355,000
    )
    
    
    5.6
    
    
    
    (1,733,000
    )
    
    
    4.0Non-deductible permanent differences
    
    
    168,000
    
    
    
    (1.4
    )
    
    
    186,000
    
    
    
    (2.9
    )
    
    
    1,746,000
    
    
    
    (4.0
    )Change in valuation allowance
    
    
    6,167,000
    
    
    
    (53.1
    )
    
    
    600,000
    
    
    
    (9.5
    )
    
    
    5,700,000
    
    
    
    (13.0
    )Other
    
    
    (221,000
    )
    
    
    1.9
    
    
    
    (373,000
    )
    
    
    5.8
    
    
    
    
    
    
    
    0.0Total taxes (benefit)
    
    
    1,672,000
    
    
    
    (14.2
    )%
    
    $
    (2,100,000
    )
    
    
    33.0
    %
    
    $
    (8,935,000
    )
    
    
    21.0
    %Less  portion attributable to
discontinued operations
    
    
    18,000
    
    
    
    
    
    
    
    300,000
    
    
    
    
    
    
    
    631,000Net attributable to continuing operations
    
    $
    1,654,000
    
    
    
    
    
    
    $
    (2,400,000
    )
    
    
    
    
    
    $
    (9,566,000
    )
 52




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##### Table of Contents



9. Net Income (Loss) Per Common Share
  2006
    
    
    2005
    
    
    2004Numerator:Income (loss) from continuing operations
    
    ($
    13,321,000
    )
    
    $
    (4,714,000
    )
    
    $
    (35,132,000
    )Income (loss) from discontinued operations, net of tax
    
    
    29,000
    
    
    
    468,000
    
    
    
    986,000Net income (loss)
    
    ($
    13,292,000
    )
    
    $
    (4,246,000
    )
    
    $
    (34,146,000
    )Denominator:Basic  weighted average common shares outstanding
    
    
    10,158,000
    
    
    
    10,133,000
    
    
    
    10,080,000DilutedStock options  employees, officers and directors
    
    
    
    
    
    
    20,000
    
    
    
    19,000Adjusted weighted average common shares outstanding
    
    
    10,158,000
    
    
    
    10,153,000
    
    
    
    10,099,000Net income (loss) per common share  basic and diluted
    
    ($
    1.31
    )
    
    ($
    0.42
    )
    
    ($
    3.39
    )
  10. Litigation and Contingencies
  53




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##### Table of Contents



Selected Quarterly Financial Information
  
 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE.
  
 ITEM 9A. CONTROLS AND PROCEDURES.
 Evaluation of Disclosure Controls and Procedures
  
    
    information required to be disclosed by AirNet in this Annual Report on Form 10-K
and the other reports that AirNet files or submits under the Exchange Act would be
accumulated and communicated to AirNets management, including its principal executive
officer and principal financial officer, as appropriate to allow timely decisions
regarding required disclosure;
    
    information required to be disclosed by AirNet in this Annual Report on Form 10-K
and the other reports that AirNet files or submits under the Exchange Act would be
recorded, processed, summarized and reported within the time periods specified in the
SECs rules and forms; and
    
    AirNets disclosure controls and procedures were effective as of the end of the
fiscal year covered by this Annual Report on Form 10-K.
 Changes in Internal Control over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION
 Conclusion of Brown Gibbons Lang & Company Engagement and Dissolution of Strategy Committee
  54




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##### Table of Contents



Amendment of Credit Agreement with The Huntington National Bank
     2006 Incentive Compensation Plan
  
    
    Attaining designated levels of pre-tax income;
    
    Improving cash flow and reducing debt;
    
    Defining and executing plans to offset expected declines in Bank Services revenues;
    
    Reducing the fixed cost structure of AirNet; and
    
    Meeting high priority deadlines of AirNet.
  55




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56




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##### Table of Contents



Adoption of 2007 Incentive Compensation Plan
  
    
    attaining designated levels of pre-tax income;
    
    achieving designated levels of Express Services revenues and contribution margin;
    
    reducing AirNets operating costs;
    
    establishing AirNet as the express air carrier of choice for highly controlled and time sensitive shipments;
    
    leveraging AirNets aviation infrastructure to improve contribution margin;
    
    operating in all areas of AirNets business in an absolutely safe, highly professional,
dependable, efficient and customer focused manner; and
    
    developing AirNets leadership team.
    57




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##### Table of Contents




    
    30% of Mr. Parkers incentive compensation
potential will be based upon attaining at least 100%
of the targeted pre-tax income for the applicable six-month period;
    
    30% of Mr. Parkers incentive compensation
potential will be based upon attaining at least 100%
of the targeted Express Services revenues and contribution margin for
the applicable six-month period; and
    
    40% of Mr. Parkers incentive compensation potential will be based upon the
attainment of the personal goals established for Mr. Parker by the Board of Directors.
  
    
    development of an AirNet operating vision, including specific objectives and strategy;
 
    
    development of a chief executive officer succession plan; and
 
    
    developing AirNets management into an integrated team working to achieve specific objectives.
   58




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##### Table of Contents



Calling of 2007 Annual Meeting of Shareholders
  
 PART III
 
 ITEM 10  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
  Corporate Governance Documents
    
 ITEM 11  EXECUTIVE COMPENSATION
  
 ITEM 12  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS.
  
 ITEM 13  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
  
 ITEM 14  PRINCIPAL ACCOUNTANT FEES AND SERVICES
  59




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##### Table of Contents



PART IV
 
 ITEM 15  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
  1.
    
    The following consolidated financial statements (and report thereon) are included
in ITEM 8  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA of this Annual Report on Form
10-K:
       2.
    
    Schedule II  Valuation and Qualifying Accounts is included below:
 COL A
    
    COL B
    
    COL C
    
    COL D
    
    COL EAdditionsBalance at
    
    Charged to
    
    Charged to
    
    
    
    
    
    Balance atStart of
    
    Costs and
    
    Other
    
    Deductions
    
    End ofDescription
    
    Period
    
    Expenses
    
    Accounts
    
    (1)
    
    PeriodYear ended December
31, 2006: Deducted
from asset
accounts; Allowance
for doubtful
accounts
    
    $
    724,729
    
    
    $
    347,529
    
    
    $
    227,716
    
    
    $
    399,974
    
    
    $
    900,000Year ended December
31, 2005: Deducted
from asset
accounts; Allowance
for doubtful
accounts
    
    $
    874,444
    
    
    $
    88,361
    
    
    $
    100,000
    
    
    $
    338,076
    
    
    $
    724,729Year ended December
31, 2004: Deducted
from asset
accounts; Allowance
for doubtful
accounts
    
    $
    515,046
    
    
    $
    522,570
    
    
    $
    0
    
    
    $
    163,172
    
    
    $
    874,444
 
 (1)
    
    Uncollectible accounts written off, net of recoveries Schedules not included above have been omitted because they are not required or the
information required to be set forth therein is included in the consolidated financial
statements or notes thereto.
 3.
    
    Exhibits
 The documents listed below are filed with this Annual Report on Form 10-K as exhibits or
incorporated into this Annual Report on Form 10-K by reference as noted:
 60




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location2.1
    
    Asset Purchase Agreement, dated as of July
11, 2003, by and among AirNet Systems,
Inc., AirNet Management, Inc., Mercury
Business Services, Inc., Andrew R. Cooke,
Peter G. Salisbury and Christopher F.
Valente. [Pursuant to Item 601(b)(2) of
SEC Regulation S-K, certain schedules and
exhibits to this Asset Purchase Agreement
have not been filed with this exhibit.
The schedules contain various items
relating to the assets being sold and the
representations and warranties of the
parties to the Asset Purchase Agreement.
AirNet Systems, Inc. has agreed to furnish
supplementally any omitted schedule or
exhibit to the SEC upon request.]
    
    Incorporated herein
by reference from
Exhibit 2.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K,
dated and filed on
July 15, 2003 (File
No. 001-13025)2.2
    
    Purchase Agreement, dated as of July 26,
2006, among Jetride, Inc., an Ohio
corporation; Pinnacle Air, LLC, a Delaware
limited liability company; and AirNet
Systems, Inc., an Ohio corporation (the
exhibits and schedules referenced in the
Purchase Agreement have been omitted
pursuant to Item 601(b)(2) of SEC
Regulation S-K. AirNet Systems, Inc.
hereby agrees to furnish supplementally a
copy of any such omitted exhibit or
schedule to the SEC upon request.)
    
    Incorporated herein
by reference from
Exhibit 2.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K,
dated and filed on
July 28, 2006 (File
No. 001-13025)3.1
    
    Amended Articles of AirNet Systems, Inc.
as filed with the Ohio Secretary of State
on April 29, 1996
    
    Incorporated herein
by reference from
Exhibit 2.1 to
AirNet Systems,
Inc.s Registration
Statement on Form
8-A (File No.
0-28428) filed on
May 3, 1996 (the
1996 Form 8-A)3.2
    
    Certificate of Amendment to the Amended
Articles of AirNet Systems, Inc. as filed
with the Ohio Secretary of State on May
28, 1996
    
    Incorporated herein
by reference from
Exhibit 4(b) to
AirNet Systems,
Inc.s Registration
Statement on Form
S-8 (Registration
No. 333-08189)
filed on July 16,
1996 (the 1996
Form S-8)3.3
    
    Amended Articles of AirNet Systems, Inc.
(reflecting all amendments) [for SEC
reporting compliance purposes only  not
filed with the Ohio Secretary of State]
    
    Incorporated herein
by reference from
Exhibit 4(c) to
AirNet Systems,
Inc.s 1996 Form
S-83.4
    
    Code of Regulations of AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 2.2 to
AirNet Systems,
Inc.s 1996 Form
8-A3.5
    
    Certificate regarding adoption of
amendment to Section 1.10 of the Code of
Regulations of AirNet Systems, Inc. by the
shareholders on May 12, 2000
    
    Incorporated herein
by reference from
Exhibit 3.1 to
AirNet Systems,
Inc.s Form 10-Q
for the quarterly
period ended June
30, 2000 (File No.
001-13025) (the
June 30, 2000 Form
10-Q)3.6
    
    Code of Regulations of AirNet Systems,
Inc. (reflecting all amendments) [for SEC
reporting compliance purposes only]
    
    Incorporated herein
by reference from
Exhibit 3.2 to
AirNet Systems,
Inc.s June 30,
2000 Form 10-Q
 61




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.1
    
    Amended and Restated Credit Agreement,
dated as of May 28, 2004, among AirNet
Systems, Inc., the lenders from time to
time party thereto and The Huntington
National Bank, as LC Issuer, as Swingline
Lender and as Administrative Agent
    
    Incorporated herein
by reference from
Exhibit 4.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated June 21, 2004
and filed on June
22, 2004 (File No.
001-13025) (the
June 2004 Form
8-K)4.2
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
AirNet Systems, Inc. and The Huntington
National Bank, as lender and as agent
    
    Incorporated herein
by reference from
Exhibit 4.2 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.3
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
Float Control, Inc. and The Huntington
National Bank, as lender and as agent
    
    Incorporated herein
by reference from
Exhibit 4.3 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.4
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
AirNet Management, Inc. and The Huntington
National Bank, as lender and as agent
    
    Incorporated herein
by reference from
Exhibit 4.4 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.5
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
Jetride, Inc. and The Huntington National
Bank, as lender and as agent [NOTE: Jetride, Inc. is now known as 7250 STARCHECK, INC.]
    
    Incorporated herein
by reference from
Exhibit 4.5 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.6
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
timexpress.com, inc. and The Huntington
National Bank, as lender and as agent
    
    Incorporated herein
by reference from
Exhibit 4.6 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.7
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
Fast Forward Solutions, LLC and The
Huntington National Bank, as lender and as
agent
    
    Incorporated herein
by reference from
Exhibit 4.7 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.8
    
    Stock Pledge Agreement, made as of May 28,
2004, by AirNet Systems, Inc. in favor of
The Huntington National Bank, as agent
    
    Incorporated herein
by reference from
Exhibit 4.8 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.9
    
    Security Agreement Pledge and Assignment
of Membership Interest, made and entered
into as of May 28, 2004, by and between
AirNet Systems, Inc. and The Huntington
National Bank, as agent
    
    Incorporated herein
by reference from
Exhibit 4.9 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.10
    
    Mortgage, Security Agreement and
Assignment, dated as of May 28, 2004,
between AirNet Systems, Inc. and The
Huntington National Bank, as agent
    
    Incorporated herein
by reference from
Exhibit 4.10 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.11
    
    Replacement Subsidiary Guaranty, made as
of May 28, 2004, by AirNet Management,
Inc., Float Control, Inc. and Jetride,
Inc. in favor of The Huntington National
Bank, as agent [NOTE: Jetride, Inc. is now known as 7250 STARCHECK, INC.]
    
    Incorporated herein
by reference from
Exhibit 4.11 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.12
    
    Subsidiary Guaranty, made as of May 28,
2004, by timexpress.com, inc. in favor of
The Huntington National Bank, as agent
    
    Incorporated herein
by reference from
Exhibit 4.12 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.13
    
    Subsidiary Guaranty, made as of May 28,
2004, by Fast Forward Solutions, LLC in
favor of The Huntington National Bank, as
agent
    
    Incorporated herein
by reference from
Exhibit 4.13 to
AirNet Systems,
Inc.s June 2004
Form 8-K
 62




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.14
    
    Waiver Letter, dated November 12, 2004,
executed by The Huntington National Bank,
in its capacity as administrative agent
for and on behalf of the lenders from time
to time party to the Amended and Restated
Credit Agreement dated as of May 28, 2004;
acknowledged and agreed to by AirNet
Systems, Inc., Jetride, Inc. (now known as
7250 STARCHECK, INC.), Float Control,
Inc., AirNet Management, Inc., Fast
Forward Solutions, LLC and timexpress,
inc.; and consented to by Bank One, N.A.
and The Huntington National Bank
    
    Incorporated herein
by reference from
Exhibit 4.24 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended
September 30, 2004
(File No.
001-13025) (the
September 30, 2004
Form 10-Q)4.15
    
    Change in Terms Agreement, made and
entered into effective as of November 12,
2004, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the Lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004
    
    Incorporated herein
by reference from
Exhibit 4.25 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.16
    
    Second Change in Terms Agreement, made and
entered into effective as of March 24,
2005, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004 as
amended
    
    Incorporated herein
by reference from
Exhibit 4.39 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2004 (File No.
001-13025) (the
2004 Form 10-K)4.17
    
    Assignment Agreement, dated effective as
of March 24, 2005, between Fifth Third
Bank, as Assignor, and The Huntington
National Bank, as Assignee, in respect of
rights and obligations under the Amended
and Restated Credit Agreement dated May
28, 2004, as amended
    
    Incorporated herein
by reference from
Exhibit 4.40 to
AirNet Systems,
Inc.s 2004 Form
10-K4.18
    
    Assignment Agreement, dated effective as
of March 24, 2005, between Fifth Third
Bank, as Assignor, and JPMorgan Chase
Bank, N.A., as Assignee, successor by
merger to Bank One, N.A., in respect of
rights and obligations under the Amended
and Restated Credit Agreement dated May
28, 2004, as amended
    
    Incorporated herein
by reference from
Exhibit 4.41 to
AirNet Systems,
Inc.s 2004 Form
10-K4.19
    
    Replacement Revolving Loan Note, issued on
March 24, 2005, by AirNet Systems, Inc. in
favor of The Huntington National Bank in
the amount of $18,750,000
    
    Incorporated herein
by reference from
Exhibit 4.42 to
AirNet Systems,
Inc.s 2004 Form
10-K4.20
    
    Replacement Revolving Loan Note, issued on
March 24, 2005, by AirNet Systems, Inc. in
favor of Bank One, N.A. in the amount of
$11,250,000
    
    Incorporated herein
by reference from
Exhibit 4.43 to
AirNet Systems,
Inc.s 2004 Form
10-K
 63




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.21
    
    Third Change in Terms Agreement, made and
entered into effective as of November 21,
2005, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004 as
amended
    
    Incorporated herein
by reference from
Exhibit 4.21 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2005 (File No.
001-13025) (the
2005 Form 10-K)4.22
    
    Fourth Change in Terms Agreement, made and
entered into effective as of March 28,
2006, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004, as
amended
    
    Incorporated herein
by reference from
Exhibit 4.22 to
AirNet Systems,
Inc.s 2005 Form 10-K4.23
    
    Fifth Change in Terms Agreement, made and
entered into effective as of November 10,
2006, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004, as
amended
    
    Incorporated herein
by reference from
Exhibit 4.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated and filed on
November 17, 2006
(File No.
001-13025) (the
November 17, 2006
Form 8-K)4.24
    
    Waiver Letter, dated November 10, 2006,
executed by The Huntington National Bank,
in its capacity as administrative agent
for and on behalf of the lenders from time
to time party to the Amended and Restated
Credit Agreement dated as of May 28, 2004,
as amended; acknowledged and agreed to by
AirNet Systems, Inc., 7250 STARCHECK, INC.
(formerly known as Jetride, Inc.), Float
Control, Inc., AirNet Management, Inc.,
Fast Forward Solutions, LLC and
timexpress, inc.; and consented to by
JPMorgan Chase Bank, N.A. (successor by
merger to Bank One, N.A.) and The
Huntington National Bank
    
    Incorporated herein
by reference from
Exhibit 4.2 to
AirNet Systems,
Inc.s November 17,
2006 Form 8-K4.25
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119495], dated as of
June 15, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.1 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.26
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119495], issued on June 15,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$7,500,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.2 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.27
    
    Corporate Guaranty [Loan Number:
1000119495], dated as of June 15, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated
on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.3 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q
 64




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.28
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119641], dated as of
June 30, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September 26,
2006]
    
    Incorporated herein
by reference from
Exhibit 4.4 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.29
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119641], issued on June 30,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.5 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.30
    
    Corporate Guaranty [Loan Number:
1000119641], dated as of June 30, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated
on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.6 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.31
    
    Acknowledgment of Borrower [Loan Number:
1000119641], dated as of June 30, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to First Union Commercial Corporation of
Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.7 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.32
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119649], dated as of
June 29, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September 26,
2006]
    
    Incorporated herein
by reference from
Exhibit 4.8 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.33
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119649], issued on June 29,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.9 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.34
    
    Corporate Guaranty [Loan Number:
1000119649], dated as of June 29, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated
on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.10 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.35
    
    Acknowledgment of Borrower [Loan Number:
1000119649], dated as of June 29, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to PNC Leasing, LLC of Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.11 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.36
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119650], dated as of
June 30, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.12 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q
 65




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.37
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119650], issued on June 30,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.13 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.38
    
    Corporate Guaranty [Loan Number:
1000119650], dated as of June 30, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated
on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.14 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.39
    
    Acknowledgment of Borrower [Loan Number:
1000119650], dated as of June 30, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to First Union Commercial Corporation of
Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.15 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.40
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119771], dated as of
July 12, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.16 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.41
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119771], issued on July 12,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.17 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.42
    
    Corporate Guaranty [Loan Number:
1000119771], dated as of July 12, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated
on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.18 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.43
    
    Acknowledgment of Borrower [Loan Number:
1000119771], dated as of July 12, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to First Union Commercial Corporation of
Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.19 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.44
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119774], dated as of
July 12, 2004, between Banc One Leasing
Corporation and Jetride, Inc. [NOTE:
Terminated on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.20 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.45
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119774], issued on July 12,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.21 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q
 66




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.46
    
    Corporate Guaranty [Loan Number:
1000119774], dated as of July 12, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated
on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.22 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.47
    
    Acknowledgment of Borrower [Loan Number:
1000119774], dated as of July 12, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to PNC Leasing, LLC of Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.23 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.48
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000122039], dated as of
March 24, 2005, by and between Chase
Equipment Leasing Inc. and AirNet Systems,
Inc. [NOTE: Terminated on September 26,
2006]
    
    Incorporated herein
by reference from
Exhibit 4.44 to
AirNet Systems,
Inc.s 2004 Form
10-K4.49
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000122039], issued on March 24,
2005, by AirNet Systems, Inc. in favor of
Chase Equipment Leasing Inc. in the amount
of $11,000,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.45 to
AirNet Systems,
Inc.s 2004 Form
10-K4.50
    
    Second Amended and Restated Credit Agreement, dated as of
          March 29, 2007, among AirNet Systems, Inc. and The Huntington
          National Bank as Lender and as Administrative Agent; and
related Consent and Agreement of Guarantors executed by
             7250 STARCHECK, INC. (formerly known as
             Jetride, Inc.); Float Control, Inc.; AirNet Management, Inc.;
             Fast Forward Solutions, LLC; and timexpress.com, inc.,
             As Guarantors
    
    Filed herewith4.51
    
    Amended and Restated Note, issued on March 29, 2007, by
            AirNet Systems, Inc. in favor of The Huntington National
            Bank in the amount of $15,000,000
    
    Filed herewith4.52
    
    Agreement to furnish instruments defining
rights of holders of long-term debt
    
    Filed herewith10.1*
    
    AirNet Systems, Inc. Amended and Restated
1996 Incentive Stock Plan (reflects all
amendments)
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2003 (File No.
001-13025) (the
2003 Form 10-K)10.2
    
    Indemnification Agreement, dated as of May
15, 1996, by and among AirNet Systems,
Inc. and Eric P. Roy, Glenn M. Miller,
Charles A. Renusch, Guy S. King, Lincoln
L. Rutter, Kendall W. Wright and William
R. Sumser
    
    Incorporated herein
by reference from
Exhibit 10.11 to
Amendment No. 2 to
AirNet Systems
Inc.s Form S-1
Registration
Statement
(Registration No.
333-03092) filed on
May 24, 1996
(Amendment No. 2
to Form S-1)10.3
    
    Indemnification Agreement, dated as of May
15, 1996, between Gerald G. Mercer and
AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.12 to
AirNet Systems,
Inc.s Amendment
No. 2 to Form S-110.4*
    
    Employment Agreement, made as of January
1, 2001, between AirNet Systems, Inc. and
Joel E. Biggerstaff [NOTE: Terminated on
December 28, 2006]
Inc.s Annual
    
    Incorporated herein
by reference from
Exhibit 10.4 to
AirNet Systems Inc.s, Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2000 (File No.
001-13025) (the
2000 Form 10-K)10.5*
    
    Separation Agreement and General Release,
entered into as of December 28, 2006,
between AirNet Systems, Inc. and Joel E.
Biggerstaff
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K,
dated and filed on
January 4, 2007
(File No.
001-13025) (the
January 4, 2007
Form 8-K)10.6*
    
    Employment Agreement, made as of January
1, 2001, between AirNet Systems, Inc. and
Jeffrey B. Harris
    
    Incorporated herein
by reference from
Exhibit 10.6 to
AirNet Systems,
Inc.s 2000 Form
10-K
 67




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.7*
    
    AirNet Systems, Inc. Director Deferred
Compensation Plan (reflects all
amendments)
    
    Incorporated herein
by reference from
Exhibit 10.7 to
AirNet Systems,
Inc.s 2003 Form
10-K10.8*
    
    AirNet Systems, Inc. Salary for Options
Conversion Plan, effective February 6,
2000
    
    Incorporated herein
by reference from
Exhibit 10.8 to
AirNet Systems,
Inc.s 2000 Form
10-K10.9*
    
    Agreement, made as of July 17, 2001,
between AirNet Systems, Inc. and Gerald G.
Mercer
    
    Incorporated herein
by reference from
Exhibit 10.9 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended June
30, 2001 (File No.
001-13025) (the
June 30, 2001 Form
10-Q)10.10*
    
    Jerry Mercer Transition Agreement,
effective May 26, 2001, between AirNet
Systems, Inc. and Gerald G. Mercer
    
    Incorporated herein
by reference from
Exhibit 10.10 to
AirNet Systems,
Inc.s June 30,
2001 Form 10-Q10.11
    
    Land Lease at Rickenbacker International
Airport, executed and entered into as of
January 20, 2004, by and between Columbus
Regional Airport Authority and AirNet
Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K,
dated February 20,
2004 and filed on
February 24, 2004
(File No.
001-13025) (the
February 2004
8-K)10.12
    
    Leasehold Improvements Purchase Agreement,
made January 20, 2004, by and between
Columbus Regional Airport Authority and
AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.13
    
    Rickenbacker International Airport
Operating Agreement, made and entered into
January 20, 2004, by and between Columbus
Regional Airport Authority and AirNet
Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.3 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.14
    
    Non-Exclusive License Agreement to Conduct
an Aeronautical Business at Rickenbacker
International Airport, entered into as of
January 20, 2004, by and between Columbus
Regional Airport Authority and AirNet
Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.4 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.15
    
    Rickenbacker International Airport
Non-Public Self-Fueling Permit for AirNet
Systems, Inc., executed by Columbus
Regional Airport Authority on January 20,
2004 and by AirNet Systems, Inc. on
January 15, 2004
    
    Incorporated herein
by reference from
Exhibit 10.5 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.16
    
    Rickenbacker International Airport
Commingling Fuel Agreement, made and
entered into January 20, 2004, by and
between Columbus Regional Airport
Authority and AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.6 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.17
    
    Non-Exclusive Access Easement granted by
Columbus Regional Airport Authority in
favor of AirNet Systems, Inc., executed on
January 20, 2004
    
    Incorporated herein
by reference from
Exhibit 10.7 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.18
    
    No-Build Easement granted by Columbus
Regional Airport Authority in favor of
AirNet Systems, Inc., executed on January
20, 2004
    
    Incorporated herein
by reference from
Exhibit 10.8 to
AirNet Systems,
Inc.s February
2004 Form 8-K
 68




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.19
    
    Lease Termination Agreement, made and
entered into to be effective as of
December 15, 2004, by and between Columbus
Regional Airport Authority and AirNet
Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated and filed on
December 21, 2004
(File No.
001-13025) (the
December 21, 2004
Form 8-K)10.20
    
    Lease, executed and entered into as of
December 15, 2004, by Columbus Regional
Airport Authority and AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s December 21,
2004 Form 8-K10.21
    
    Amendment No.1 to Land Lease, made and
entered into to be effective as of April
5, 2004, by and between Columbus Regional
Airport Authority and AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.3 to
AirNet Systems,
Inc.s December 21,
2004 Form 8-K10.22
    
    Amendment No. 2 to Land Lease, made and
entered into to be effective as of October
29, 2004, by and between Columbus Regional
Airport Authority and AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.21 to
AirNet Systems,
Inc.s 2005 Form
10-K10.23*
    
    AirNet Systems, Inc. 2004 Stock Incentive
Plan (reflects all amendments)
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended June
30, 2004 (File No.
001-13025)10.24*
    
    Form of Stock Option Agreement, made to be
effective as of July 20, 2005 used in
connection with grant of nonstatutory
stock options to newly-appointed
non-employee directors (Eligible
Directors) of AirNet Systems, Inc. under
the AirNet Systems, Inc. 2004 Stock
Incentive Plan
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended
September 30, 2005
(File No.
001-13025)10.25*
    
    Form of Stock Option Agreement used and to
be used in connection with the automatic
annual grant of nonstatutory stock options
to non-employee directors (Eligible
Directors) of AirNet Systems, Inc. on
and after January 2, 2007 under the AirNet
Systems, Inc. 2004 Stock Incentive Plan
    
    Filed herewith10.26*
    
    Summary of Compensation for
Directors of AirNet Systems, Inc.
    
    Filed herewith10.27*
    
    Employment Agreement, made as of May 3,
2005, between AirNet Systems, Inc. and
Gary W. Qualmann
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated and filed on
May 6, 2005 (File
No. 001-13025) (the
May 6, 2005 Form
8-K)10.28*
    
    Employment Agreement, made as of May 3,
2005, between AirNet Systems, Inc. and
Larry M. Glasscock, Jr.
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s May 6, 2005
Form 8-K10.29*
    
    Summary of AirNet Systems, Inc. 2006
Incentive Compensation Plan
    
    Filed herewith10.30*
    
    Employment Agreement for Bruce D. Parker,
entered into December 28, 2006, by and
between AirNet Systems, Inc. and Bruce D.
Parker
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s January 4,
2007 Form 8-K
 69




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.31*
    
    Stock Option Agreement, made to be
effective as of December 28, 2006, by and
between AirNet Systems, Inc. and Bruce D.
Parker evidencing nonstatutory stock
options granted under the AirNet Systems,
Inc. 2004 Stock Incentive Plan
    
    Filed herewith10.32*
    
    Summary of 2007 Incentive Compensation Plan
    
    Filed herewith14
    
    Code of Business Conduct and
Ethics, as revised on August 2, 2006
    
    Incorporated herein
by reference from
Exhibit 14 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended June
30, 2006 (File No.
001-13025)21
    
    Subsidiaries of AirNet Systems, Inc.
    
    Filed herewith23
    
    Consent of Independent Registered Public
Accounting Firm  Ernst & Young LLP
    
    Filed herewith24
    
    Powers of Attorney
    
    Filed herewith31.1
    
    Rule 13a-14(a)/15d-14(a) Certification
(Principal Executive Officer)
    
    Filed herewith31.2
    
    Rule 13a-14(a)/15d-14(a) Certification
(Principal Financial Officer)
    
    Filed herewith32
    
    Section 1350 Certification (Principal Executive
Officer and Principal Financial Officer)
    
    Filed herewith
 
 *
    
    Denotes a management contract or compensatory plan or arrangement required to be
filed pursuant to Item 15(b) of Form 10-K. (b) Exhibits
  (c) Financial Statement Schedules
  70




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##### Table of Contents



SIGNATURES
  AIRNET SYSTEMS, INC.Dated: March 30, 2007
    
    
    
    By: /s/ Bruce D. Parker

Bruce D. Parker, Chairman of the Board,Chief Executive Officer and President
  Signature
    
    Title
    
    Date/s/ Bruce D. Parker

Bruce D. Parker
    
    Chairman of the Board, Chief
Executive Officer, President and Director (Principal Executive
Officer)
    
    March 30, 2007/s/ Gary W. Qualmann

Gary W. Qualmann
    
    Chief Financial Officer,
Treasurer and Secretary
(Principal Financial Officer)
    
    March 30, 2007/s/ Ray L. Druseikis

Ray L. Druseikis
    
    Vice President of Finance,
Controller and Principal
Accounting Officer
    
    March 30, 2007*James M. Chadwick

James M. Chadwick
    
    Director
    
    March 30, 2007
 71




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##### Table of Contents



Signature
    
    Title
    
    Date*Russell M. Gertmenian

Russell M. Gertmenian
    
    Director
    
    March 30, 2007*Gerald Hellerman

Gerald Hellerman
    
    Director
    
    March 30, 2007*James E. Riddle

James E. Riddle
    
    Director
    
    March 30, 2007
 
 *By
    
    /s/ Bruce D. Parker

Bruce D. Parker, Attorney-in-Fact
 72




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##### Table of Contents



INDEX TO EXHIBITS
 ExhibitNo.
    
    Description
    
    Location2.1
    
    Asset Purchase Agreement, dated as of July
11, 2003, by and among AirNet Systems,
Inc., AirNet Management, Inc., Mercury
Business Services, Inc., Andrew R. Cooke,
Peter G. Salisbury and Christopher F.
Valente. [Pursuant to Item 601(b)(2) of
SEC Regulation S-K, certain schedules and
exhibits to this Asset Purchase Agreement
have not been filed with this exhibit.
The schedules contain various items
relating to the assets being sold and the
representations and warranties of the
parties to the Asset Purchase Agreement.
AirNet Systems, Inc. has agreed to furnish
supplementally any omitted schedule or
exhibit to the SEC upon request.]
    
    Incorporated herein
by reference from
Exhibit 2.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K,
dated and filed on
July 15, 2003 (File
No. 001-13025)2.2
    
    Purchase Agreement, dated as of July 26,
2006, among Jetride, Inc., an Ohio
corporation; Pinnacle Air, LLC, a Delaware
limited liability company; and AirNet
Systems, Inc., an Ohio corporation (the
exhibits and schedules referenced in the
Purchase Agreement have been omitted
pursuant to Item 601(b)(2) of SEC
Regulation S-K. AirNet Systems, Inc.
hereby agrees to furnish supplementally a
copy of any such omitted exhibit or
schedule to the SEC upon request.)
    
    Incorporated herein
by reference from
Exhibit 2.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K,
dated and filed on
July 28, 2006 (File
No. 001-13025)3.1
    
    Amended Articles of AirNet Systems, Inc.
as filed with the Ohio Secretary of State
on April 29, 1996
    
    Incorporated herein
by reference from
Exhibit 2.1 to
AirNet Systems,
Inc.s Registration
Statement on Form
8-A (File No.
0-28428) filed on
May 3, 1996 (the
1996 Form 8-A)3.2
    
    Certificate of Amendment to the Amended
Articles of AirNet Systems, Inc. as filed
with the Ohio Secretary of State on May
28, 1996
    
    Incorporated herein
by reference from
Exhibit 4(b) to
AirNet Systems,
Inc.s Registration
Statement on Form
S-8 (Registration
No. 333-08189)
filed on July 16,
1996 (the 1996
Form S-8)3.3
    
    Amended Articles of AirNet Systems, Inc.
(reflecting all amendments) [for SEC
reporting compliance purposes only  not
filed with the Ohio Secretary of State]
    
    Incorporated herein
by reference from
Exhibit 4(c) to
AirNet Systems,
Inc.s 1996 Form
S-83.4
    
    Code of Regulations of AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 2.2 to
AirNet Systems,
Inc.s 1996 Form
8-A3.5
    
    Certificate regarding adoption of
amendment to Section 1.10 of the Code of
Regulations of AirNet Systems, Inc. by the
shareholders on May 12, 2000
    
    Incorporated herein
by reference from
Exhibit 3.1 to
AirNet Systems,
Inc.s Form 10-Q
for the quarterly
period ended June
30, 2000 (File No.
001-13025) (the
June 30, 2000 Form
10-Q)3.6
    
    Code of Regulations of AirNet Systems,
Inc. (reflecting all amendments) [for SEC
reporting compliance purposes only]
    
    Incorporated herein
by reference from
Exhibit 3.2 to
AirNet Systems,
Inc.s June 30,
2000 Form 10-Q
 73




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.1
    
    Amended and Restated Credit Agreement,
dated as of May 28, 2004, among AirNet
Systems, Inc., the lenders from time to
time party thereto and The Huntington
National Bank, as LC Issuer, as Swingline
Lender and as Administrative Agent
    
    Incorporated herein
by reference from
Exhibit 4.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated June 21, 2004
and filed on June
22, 2004 (File No.
001-13025) (the
June 2004 Form
8-K)4.2
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
AirNet Systems, Inc. and The Huntington
National Bank, as lender and as agent
    
    Incorporated herein
by reference from
Exhibit 4.2 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.3
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
Float Control, Inc. and The Huntington
National Bank, as lender and as agent
    
    Incorporated herein
by reference from
Exhibit 4.3 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.4
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
AirNet Management, Inc. and The Huntington
National Bank, as lender and as agent
    
    Incorporated herein
by reference from
Exhibit 4.4 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.5
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
Jetride, Inc. and The Huntington National
Bank, as lender and as agent [NOTE: Jetride, Inc. is now known as 7250 STARCHECK, INC.]
    
    Incorporated herein
by reference from
Exhibit 4.5 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.6
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
timexpress.com, inc. and The Huntington
National Bank, as lender and as agent
    
    Incorporated herein
by reference from
Exhibit 4.6 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.7
    
    Continuing Security Agreement, entered
into as of May 28, 2004, by and between
Fast Forward Solutions, LLC and The
Huntington National Bank, as lender and as
agent
    
    Incorporated herein
by reference from
Exhibit 4.7 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.8
    
    Stock Pledge Agreement, made as of May 28,
2004, by AirNet Systems, Inc. in favor of
The Huntington National Bank, as agent
    
    Incorporated herein
by reference from
Exhibit 4.8 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.9
    
    Security Agreement Pledge and Assignment
of Membership Interest, made and entered
into as of May 28, 2004, by and between
AirNet Systems, Inc. and The Huntington
National Bank, as agent
    
    Incorporated herein
by reference from
Exhibit 4.9 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.10
    
    Mortgage, Security Agreement and
Assignment, dated as of May 28, 2004,
between AirNet Systems, Inc. and The
Huntington National Bank, as agent
    
    Incorporated herein
by reference from
Exhibit 4.10 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.11
    
    Replacement Subsidiary Guaranty, made as
of May 28, 2004, by AirNet Management,
Inc., Float Control, Inc. and Jetride,
Inc. in favor of The Huntington National
Bank, as agent [NOTE: Jetride, Inc. is now known as 7250 STARCHECK, INC.]
    
    Incorporated herein
by reference from
Exhibit 4.11 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.12
    
    Subsidiary Guaranty, made as of May 28,
2004, by timexpress.com, inc. in favor of
The Huntington National Bank, as agent
    
    Incorporated herein
by reference from
Exhibit 4.12 to
AirNet Systems,
Inc.s June 2004
Form 8-K
 74




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.13
    
    Subsidiary Guaranty, made as of May 28,
2004, by Fast Forward Solutions, LLC in
favor of The Huntington National Bank, as
agent
    
    Incorporated herein
by reference from
Exhibit 4.13 to
AirNet Systems,
Inc.s June 2004
Form 8-K4.14
    
    Waiver Letter, dated November 12, 2004,
executed by The Huntington National Bank,
in its capacity as administrative agent
for and on behalf of the lenders from time
to time party to the Amended and Restated
Credit Agreement dated as of May 28, 2004;
acknowledged and agreed to by AirNet
Systems, Inc., Jetride, Inc. (now known as
7250 STARCHECK, INC.), Float Control,
Inc., AirNet Management, Inc., Fast
Forward Solutions, LLC and timexpress,
inc.; and consented to by Bank One, N.A.
and The Huntington National Bank
    
    Incorporated herein
by reference from
Exhibit 4.24 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended
September 30, 2004
(File No.
001-13025) (the
September 30, 2004
Form 10-Q)4.15
    
    Change in Terms Agreement, made and
entered into effective as of November 12,
2004, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the Lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004
    
    Incorporated herein
by reference from
Exhibit 4.25 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.16
    
    Second Change in Terms Agreement, made and
entered into effective as of March 24,
2005, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004 as
amended
    
    Incorporated herein
by reference from
Exhibit 4.39 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2004 (File No.
001-13025) (the
2004 Form 10-K)4.17
    
    Assignment Agreement, dated effective as
of March 24, 2005, between Fifth Third
Bank, as Assignor, and The Huntington
National Bank, as Assignee, in respect of
rights and obligations under the Amended
and Restated Credit Agreement dated May
28, 2004, as amended
    
    Incorporated herein
by reference from
Exhibit 4.40 to
AirNet Systems,
Inc.s 2004 Form
10-K4.18
    
    Assignment Agreement, dated effective as
of March 24, 2005, between Fifth Third
Bank, as Assignor, and JPMorgan Chase
Bank, N.A., as Assignee, successor by
merger to Bank One, N.A., in respect of
rights and obligations under the Amended
and Restated Credit Agreement dated May
28, 2004, as amended
    
    Incorporated herein
by reference from
Exhibit 4.41 to
AirNet Systems,
Inc.s 2004 Form
10-K4.19
    
    Replacement Revolving Loan Note, issued on
March 24, 2005, by AirNet Systems, Inc. in
favor of The Huntington National Bank in
the amount of $18,750,000
    
    Incorporated herein
by reference from
Exhibit 4.42 to
AirNet Systems,
Inc.s 2004 Form
10-K4.20
    
    Replacement Revolving Loan Note, issued on
March 24, 2005, by AirNet Systems, Inc. in
favor of Bank One, N.A. in the amount of
$11,250,000
    
    Incorporated herein
by reference from
Exhibit 4.43 to
AirNet Systems,
Inc.s 2004 Form
10-K
 75




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.21
    
    Third Change in Terms Agreement, made and
entered into effective as of November 21,
2005, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004 as
amended
    
    Incorporated herein
by reference from
Exhibit 4.21 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2005 (File No.
001-13025) (the
2005 Form 10-K)4.22
    
    Fourth Change in Terms Agreement, made and
entered into effective as of March 28,
2006, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004, as
amended
    
    Incorporated herein
by reference from
Exhibit 4.22 to
AirNet Systems,
Inc.s 2005 Form 10-K4.23
    
    Fifth Change in Terms Agreement, made and
entered into effective as of November 10,
2006, by and between AirNet Systems, Inc.
and The Huntington National Bank, in its
capacity as administrative agent for and
on behalf of the lenders from time to time
party to the Amended and Restated Credit
Agreement dated as of May 28, 2004, as
amended
    
    Incorporated herein
by reference from
Exhibit 4.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated and filed on
November 17, 2006
(File No.
001-13025) (the
November 17, 2006
Form 8-K)4.24
    
    Waiver Letter, dated November 10, 2006,
executed by The Huntington National Bank,
in its capacity as administrative agent
for and on behalf of the lenders from time
to time party to the Amended and Restated
Credit Agreement dated as of May 28, 2004,
as amended; acknowledged and agreed to by
AirNet Systems, Inc., 7250 STARCHECK, INC.
(formerly known as Jetride, Inc.), Float
Control, Inc., AirNet Management, Inc.,
Fast Forward Solutions, LLC and
timexpress, inc.; and consented to by
JPMorgan Chase Bank, N.A. (successor by
merger to Bank One, N.A.) and The
Huntington National Bank
    
    Incorporated herein
by reference from
Exhibit 4.2 to
AirNet Systems,
Inc.s November 17,
2006 Form 8-K4.25
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119495], dated as of
June 15, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September 26,
2006]
    
    Incorporated herein
by reference from
Exhibit 4.1 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.26
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119495], issued on June 15,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$7,500,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.2 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.27
    
    Corporate Guaranty [Loan Number:
1000119495], dated as of June 15, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.3 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q
 76




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.28
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119641], dated as of
June 30, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September 26,
2006]
    
    Incorporated herein
by reference from
Exhibit 4.4 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.29
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119641], issued on June 30,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.5 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.30
    
    Corporate Guaranty [Loan Number:
1000119641], dated as of June 30, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.6 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.31
    
    Acknowledgment of Borrower [Loan Number:
1000119641], dated as of June 30, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to First Union Commercial Corporation of
Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.7 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.32
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119649], dated as of
June 29, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September 26,
2006]
    
    Incorporated herein
by reference from
Exhibit 4.8 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.33
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119649], issued on June 29,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.9 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.34
    
    Corporate Guaranty [Loan Number:
1000119649], dated as of June 29, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.10 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.35
    
    Acknowledgment of Borrower [Loan Number:
1000119649], dated as of June 29, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to PNC Leasing, LLC of Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.11 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.36
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119650], dated as of
June 30, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.12 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q
 77




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.37
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119650], issued on June 30,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.13 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.38
    
    Corporate Guaranty [Loan Number:
1000119650], dated as of June 30, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.14 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.39
    
    Acknowledgment of Borrower [Loan Number:
1000119650], dated as of June 30, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to First Union Commercial Corporation of
Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.15 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.40
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119771], dated as of
July 12, 2004, by and between Banc One
Leasing Corporation and Jetride, Inc.
[NOTE: Terminated on September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.16 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.41
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119771], issued on July 12,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.17 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.42
    
    Corporate Guaranty [Loan Number:
1000119771], dated as of July 12, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.18 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.43
    
    Acknowledgment of Borrower [Loan Number:
1000119771], dated as of July 12, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to First Union Commercial Corporation of
    
    Incorporated herein
by reference from
Exhibit 4.19 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-QLoan Documents4.44
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000119774], dated as of
July 12, 2004, between Banc One Leasing
Corporation and Jetride, Inc. [NOTE:
Terminated on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.20 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.45
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000119774], issued on July 12,
2004, by Jetride, Inc. in favor of Banc
One Leasing Corporation in the amount of
$5,000,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.21 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q
 78




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.46
    
    Corporate Guaranty [Loan Number:
1000119774], dated as of July 12, 2004,
from AirNet Systems, Inc. in favor of Banc
One Leasing Corporation [NOTE:
Terminated on September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.22 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.47
    
    Acknowledgment of Borrower [Loan Number:
1000119774], dated as of July 12, 2004, by
Jetride, Inc. in favor of Banc One Leasing
Corporation acknowledging sale and
assignment by Banc One Leasing Corporation
to PNC Leasing, LLC of Loan Documents
    
    Incorporated herein
by reference from
Exhibit 4.23 to
AirNet Systems,
Inc.s September
30, 2004 Form 10-Q4.48
    
    Loan and Security Agreement (aircraft)
[Loan Number: 1000122039], dated as of
March 24, 2005, by and between Chase
Equipment Leasing Inc. and AirNet Systems,
Inc. [NOTE: Terminated on September
26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.44 to
AirNet Systems,
Inc.s 2004 Form
10-K4.49
    
    Business Purpose Promissory Note (fixed
rate//principal and interest) [Loan
Number: 1000122039], issued on March 24,
2005, by AirNet Systems, Inc. in favor of
Chase Equipment Leasing Inc. in the amount
of $11,000,000 [NOTE: Terminated on
September 26, 2006]
    
    Incorporated herein
by reference from
Exhibit 4.45 to
AirNet Systems,
Inc.s 2004 Form
10-K4.50
    
    Second Amended and Restated Credit Agreement, dated as of
          March 29, 2007, among AirNet Systems, Inc. and The Huntington
          National Bank as Lender and as Administrative Agent; and
related Consent and Agreement of Guarantors executed by
             7250 STARCHECK, INC. (formerly known as
             Jetride, Inc.); Float Control, Inc.; AirNet Management, Inc.;
             Fast Forward Solutions, LLC; and timexpress.com, inc.,
             As Guarantors
    
    Filed herewith4.51
    
    Amended and Restated Note, issued on March 29, 2007, by
            AirNet Systems, Inc. in favor of The Huntington National
            Bank in the amount of $15,000,000
    
    Filed herewith4.52
    
    Agreement to furnish instruments defining
rights of holders of long-term debt
    
    Filed herewith10.1*
    
    AirNet Systems, Inc. Amended and Restated
1996 Incentive Stock Plan (reflects all
amendments)
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2003 (File No.
001-13025) (the
2003 Form 10-K)10.2
    
    Indemnification Agreement, dated as of May
15, 1996, by and among AirNet Systems,
Inc. and Eric P. Roy, Glenn M. Miller,
Charles A. Renusch, Guy S. King, Lincoln
L. Rutter, Kendall W. Wright and William
R. Sumser
    
    Incorporated herein
by reference from
Exhibit 10.11 to
Amendment No. 2 to
AirNet Systems
Inc.s Form S-1
Registration
Statement
(Registration No.
333-03092) filed on
May 24, 1996
(Amendment No. 2
to Form S-1)10.3
    
    Indemnification Agreement, dated as of May
15, 1996, between Gerald G. Mercer and
AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.12 to
AirNet Systems,
Inc.s Amendment
No. 2 to Form S-110.4*
    
    Employment Agreement, made as of January
1, 2001, between AirNet Systems, Inc. and
Joel E. Biggerstaff [NOTE: Terminated
on December 28, 2006]
    
    Incorporated herein
by reference from
Exhibit 10.4 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2000 (File No.
001-13025) (the
2000 Form 10-K)10.5*
    
    Separation Agreement and General Release,
entered into as of December 28, 2006,
between AirNet Systems, Inc. and Joel E.
Biggerstaff
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K,
dated and filed on
January 4, 2007
(File No.
001-13025) (the
January 4, 2007
Form 8-K)10.6*
    
    Employment Agreement, made as of January
1, 2001, between AirNet Systems, Inc. and
Jeffrey B. Harris
    
    Incorporated herein
by reference from
Exhibit 10.6 to
AirNet Systems,
Inc.s 2000 Form
10-K
 79




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.7*
    
    AirNet Systems, Inc. Director Deferred
Compensation Plan (reflects all
amendments)
    
    Incorporated herein
by reference from
Exhibit 10.7 to
AirNet Systems,
Inc.s 2003 Form
10-K10.8*
    
    AirNet Systems, Inc. Salary for Options
Conversion Plan, effective February 6,
2000
    
    Incorporated herein
by reference from
Exhibit 10.8 to
AirNet Systems,
Inc.s 2000 Form
10-K10.9*
    
    Agreement, made as of July 17, 2001,
between AirNet Systems, Inc. and Gerald G.
Mercer
    
    Incorporated herein
by reference from
Exhibit 10.9 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended June
30, 2001 (File No.
001-13025) (the
June 30, 2001 Form
10-Q)10.10*
    
    Jerry Mercer Transition Agreement,
effective May 26, 2001, between AirNet
Systems, Inc. and Gerald G. Mercer
    
    Incorporated herein
by reference from
Exhibit 10.10 to
AirNet Systems,
Inc.s June 30,
2001 Form 10-Q10.11
    
    Land Lease at Rickenbacker International
Airport, executed and entered into as of
January 20, 2004, by and between Columbus
Regional Airport Authority and AirNet
Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K,
dated February 20,
2004 and filed on
February 24, 2004
(File No.
001-13025) (the
February 2004
8-K)10.12
    
    Leasehold Improvements Purchase Agreement,
made January 20, 2004, by and between
Columbus Regional Airport Authority and
AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.13
    
    Rickenbacker International Airport
Operating Agreement, made and entered into
January 20, 2004, by and between Columbus
Regional Airport Authority and AirNet
Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.3 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.14
    
    Non-Exclusive License Agreement to Conduct
an Aeronautical Business at Rickenbacker
International Airport, entered into as of
January 20, 2004, by and between Columbus
Regional Airport Authority and AirNet
Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.4 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.15
    
    Rickenbacker International Airport
Non-Public Self-Fueling Permit for AirNet
Systems, Inc., executed by Columbus
Regional Airport Authority on January 20,
2004 and by AirNet Systems, Inc. on
January 15, 2004
    
    Incorporated herein
by reference from
Exhibit 10.5 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.16
    
    Rickenbacker International Airport
Commingling Fuel Agreement, made and
entered into January 20, 2004, by and
between Columbus Regional Airport
Authority and AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.6 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.17
    
    Non-Exclusive Access Easement granted by
Columbus Regional Airport Authority in
favor of AirNet Systems, Inc., executed on
January 20, 2004
    
    Incorporated herein
by reference from
Exhibit 10.7 to
AirNet Systems,
Inc.s February
2004 Form 8-K10.18
    
    No-Build Easement granted by Columbus
Regional Airport Authority in favor of
AirNet Systems, Inc., executed on January
20, 2004
    
    Incorporated herein
by reference from
Exhibit 10.8 to
AirNet Systems,
Inc.s February
2004 Form 8-K
 80




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.19
    
    Lease Termination Agreement, made and
entered into to be effective as of
December 15, 2004, by and between Columbus
Regional Airport Authority and AirNet
Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated and filed on
December 21, 2004
(File No.
001-13025) (the
December 21, 2004
Form 8-K)10.20
    
    Lease, executed and entered into as of
December 15, 2004, by Columbus Regional
Airport Authority and AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s December 21,
2004 Form 8-K10.21
    
    Amendment No.1 to Land Lease, made and
entered into to be effective as of April
5, 2004, by and between Columbus Regional
Airport Authority and AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.3 to
AirNet Systems,
Inc.s December 21,
2004 Form 8-K10.22
    
    Amendment No. 2 to Land Lease, made and
entered into to be effective as of October
29, 2004, by and between Columbus Regional
Airport Authority and AirNet Systems, Inc.
    
    Incorporated herein
by reference from
Exhibit 10.21 to
AirNet Systems,
Inc.s 2005 Form
10-K10.23*
    
    AirNet Systems, Inc. 2004 Stock Incentive
Plan (reflects all amendments)
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended June
30, 2004 (File No.
001-13025)10.24*
    
    Form of Stock Option Agreement, made to be
effective as of July 20, 2005 used in
connection with grant of nonstatutory
stock options to newly-appointed
non-employee directors (Eligible
Directors) of AirNet Systems, Inc. under
the AirNet Systems, Inc. 2004 Stock
Incentive Plan
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended
September 30, 2005
(File No.
001-13025)10.25*
    
    Form of Stock Option Agreement used and to
be used in connection with the automatic
annual grant of nonstatutory stock options
to non-employee directors (Eligible
Directors) of AirNet Systems, Inc. on
and after January 2, 2007 under the AirNet
Systems, Inc. 2004 Stock Incentive Plan
    
    Filed herewith10.26*
    
    Summary of Compensation for
Directors of AirNet Systems, Inc.
    
    Filed herewith10.27*
    
    Employment Agreement, made as of May 3,
2005, between AirNet Systems, Inc. and
Gary W. Qualmann
    
    Incorporated herein
by reference from
Exhibit 10.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated and filed on
May 6, 2005 (File
No. 001-13025) (the
May 6, 2005 Form
8-K)10.28*
    
    Employment Agreement, made as of May 3,
2005, between AirNet Systems, Inc. and
Larry M. Glasscock, Jr.
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s May 6, 2005
Form 8-K10.29*
    
    Summary of AirNet Systems, Inc. 2006
Incentive Compensation Plan
    
    Filed herewith
 81




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.30*
    
    Employment Agreement for Bruce D. Parker,
entered into December 28, 2006, by and
between AirNet Systems, Inc. and Bruce D.
Parker
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s January 4,
2007 Form 8-K10.31*
    
    Stock Option Agreement, made to be
effective as of December 28, 2006, by and
between AirNet Systems, Inc. and Bruce D.
Parker evidencing nonstatutory stock
options granted under the AirNet Systems,
Inc. 2004 Stock Incentive Plan
    
    Filed herewith10.32*
    
    Summary of 2007 Incentive Compensation Plan
    
    Filed herewith14
    
    Code of Business Conduct and
Ethics, as revised on August 2, 2006
    
    Incorporated herein
by reference from
Exhibit 14 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended June
30, 2006 (File No.
001-13025)21
    
    Subsidiaries of AirNet Systems, Inc.
    
    Filed herewith23
    
    Consent of Independent Registered Public
Accounting Firm  Ernst & Young LLP
    
    Filed herewith24
    
    Powers of Attorney
    
    Filed herewith31.1
    
    Rule 13a-14(a)/15d-14(a) Certification
(Principal Executive Officer)
    
    Filed herewith31.2
    
    Rule 13a-14(a)/15d-14(a) Certification
(Principal Financial Officer)
    
    Filed herewith32
    
    Section 1350 Certification (Principal Executive
Officer and Principal Financial Officer)
    
    Filed herewith
 
 *
    
    Denotes a management contract or compensatory plan or arrangement required to be
filed pursuant to Item 15(b) of Form 10-K. 82