**Exhibit 10.1**

 

**AIRNET SYSTEMS, INC.**

**AMENDED AND RESTATED**

**1996 INCENTIVE STOCK PLAN**

**(Reflects amendments through February 17, 2004)**

 

SECTION 1.  **Purposes**.  The purposes of the Amended and RestatedAirNet Systems, Inc. 1996 Incentive Stock Plan are to promote the interests ofAirNet Systems, Inc. and its shareholders by (a) attracting and retainingexceptional executive personnel and other key employees of, and advisors andconsultants to, and directors of the Company and its Subsidiaries;(b) motivating such employees, advisors and consultants and EligibleDirectors by means of performance-related incentives to achieve longer-rangeperformance goals; and (c) providing all long-term employees of theCompany and its Subsidiaries with the opportunity to participate in thelong-term growth and financial success of the Company.

 

SECTION 2.  **Definitions**.  As used in the Plan, the following termsshall have the meanings set forth below:

 

“Award” shall mean any Option, Restricted StockAward or Performance Award but shall not include any Director Option, any Rightto Purchase or any Share issued pursuant to Section 10 of this Plan.

 

“Award Agreement” shall mean any written agreement,contract or other instrument or document evidencing any Award which may, butneed not, be executed or acknowledged by a Participant.

 

“Board” shall mean the Board of Directors of theCompany.

 

“Cash Account” shall mean an account establishedfor each Participant to which amounts withheld through payroll deductions shallbe credited to purchase Shares under the provisions of Section 10.

 

“Code” shall mean the Internal Revenue Code of1986, as amended from time to time.

 

“Committee” shall mean a committee of the Boarddesignated by the Board to administer the Plan which shall satisfy the requirementscontained in Section 1.162-27(c)(4) of the Final Regulations.  The Committee shall be composed of not lessthan the minimum number of persons from time to time required by Rule l6b-3,each of whom shall be (a) a person from time to time permitted by therules promulgated under Section 16 of the Exchange Act in order for grantsof Awards to be exempt transactions under said Section 16; and(b) receiving remuneration in no other capacity than as a director, exceptas permitted under Section 1.162-27(e)(3) of the Final Regulations.

 

“Company” shall mean AirNet Systems, Inc., togetherwith any successor thereto.

 

“Covered Employee” shall mean any individual who,on the last day of the Company’s taxable year, is

 

(a)           the chief executive officer of the Company oris acting in such capacity; or

 

(b)           among the four highest compensated officers(other than the chief executive officer).

 

For this purpose, whether an individual is thechief executive officer or one of the four highest compensated officers of the Companyshall be determined pursuant to the executive compensation disclosure rulesunder the Exchange Act.

 

“Director Option” shall mean a Non-Qualified StockOption granted to an Eligible Director pursuant to Section 6(e) of thePlan.  [Amended effective August 18,1999.]

 

“Effective Date” shall mean the date on which thePlan is approved by the shareholders of the Company.

 

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“Eligible Director” shall mean, on any date, aperson who is serving as a member of the Board but shall not include a personwho is an Employee of the Company or a Subsidiary or a person who was a memberof the Board on May 1, 1996.

 

“Employee” shall mean (a) an employee of theCompany or of any Subsidiary; and (b) except with respect to an Incentive StockOption, a Right to Purchase and the issuance of Shares under Section 10,an advisor or consultant to the Company or to any Subsidiary.

 

“Exchange Act” shall mean the Securities ExchangeAct of 1934, as amended.

 

“Fair Market Value” shall mean the fair marketvalue of the property or other item being valued, as determined by theCommittee in its sole discretion, provided that the fair market value of Sharesshall be determined by reference to the most recent closing price quotation or,if none, the average of the bid and asked prices, as reported as of the mostrecent available date with respect to the sale of Shares on any quotationsystem approved by the National Association of Securities Dealers thenreporting sales of Shares or on any national securities exchange on which the Sharesare then listed.

 

“Final Regulations” shall mean the finalregulations promulgated by the Internal Revenue Service underSection 162(m) of the Code.

 

“Incentive Stock Option” shall mean a right topurchase Shares from the Company that is granted under Section 6 of thePlan and that is intended to meet the requirements of Section 422 of theCode or any successor provision thereto.

 

“Non-Qualified Stock Option” shall mean a right topurchase Shares from the Company that is granted under Section 6 of the Planand that is not intended to be an Incentive Stock Option.

 

“Offering” shall mean an opportunity provided bythe Committee to purchase Shares under the provisions of Section 10.  Offerings may be consecutive or concurrent,as determined by the Committee.  TheCommittee shall designate the maximum number of Shares that may be purchasedunder each Offering.  Shares not soldunder one Offering may be offered again in any subsequent Offering.

 

“Offering Effective Date” shall mean the firstbusiness day of the month designated by the Committee as the start of theOffering Period applicable to an Offering.

 

“Offering Period” shall mean the duration of anOffering, as designated by the Committee. The Offering Period for any Offering shall not exceed 12 months.

 

“Option” shall mean an Incentive Stock Option or aNon-Qualified Stock Option but shall not include a Director Option.

 

“Participant” shall mean any Employee selected bythe Committee to receive an Award under the Plan.  In addition, for purposes of Section 10, the term“Participant” shall include any Employee who has satisfied the requirements ofsuch section to acquire Shares under the Plan.

 

“Performance Award” shall mean any right grantedunder Section 8 of the Plan.

 

“Person” shall mean any individual, corporation,partnership, association, joint-stock company, trust, unincorporatedorganization, government or political subdivision thereof or other entity.

 

“Plan” shall mean the AirNet Systems, Inc. Amendedand Restated 1996 Incentive Stock Plan.

 

“Restricted Stock” shall mean any Share grantedunder Section 7 of the Plan.

 

“Right to Purchase” shall mean an option topurchase Shares granted to a Participant who elects to participate in anOffering under the provisions of Section 10.  A Right to Purchase granted for an Offering shall terminatefollowing the close of business on the Right to Purchase Date for that Offeringto the extent that such Right to Purchase is not exercised on such Right toPurchase Date.

 

“Right to Purchase Date” shall mean the lastbusiness day of an Offering Period to purchase Shares under the provisions ofSection 10.

 

“Rule l6b-3” shall mean Rule l6b-3 as promulgatedand interpreted by the SEC under the Exchange Act, or any successor rule orregulation thereto as in effect from time to time.

 

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“SEC” shall mean the Securities and ExchangeCommission or any successor thereto and shall include the staff thereof.

 

“Shares” shall mean the Common Shares, $0.01 parvalue, of the Company or such other securities of the Company as may bedesignated by the Committee from time to time.

 

“Share Account” shall mean an account establishedfor each Participant who exercises a Right to Purchase underSection 10.  A Participant’s ShareAccount will be credited with the number of Shares purchased on each Right toPurchase Date and debited for the number of Shares withdrawn by the Participantafter such date.

 

“Subsidiary” shall mean any corporation which, onthe date of determination, qualified as a subsidiary corporation of theCorporation under Section 424(f) of the Code.

 

“Substitute Awards” shall mean Awards granted inassumption of, or in substitution for, outstanding awards previously granted bya company acquired by the Company or with which the Company combines.

 

“Ten Percent Shareholder” shall mean anyshareholder who, at the time an Incentive Stock Option is granted to suchshareholder, owns (within the meaning of Section 424(d) of the Code) morethan ten percent of the voting power of all classes of stock of the Company ora Subsidiary.

 

SECTION 3.  **Administration**.

 

(a)           The Plan shall be administered by theCommittee.  Subject to the terms of thePlan and applicable law, and in addition to other express powers andauthorizations conferred on the Committee by the Plan, the Committee shall havefull power and authority to: (i) designate Participants;(ii) determine the type or types of Awards to be granted to an eligibleEmployee; (iii) determine the number of Shares to be covered by, or withrespect to which payments, rights or other matters are to be calculated inconnection with Awards; (iv) determine the terms and conditions of anyAward or Director Option; (v) determine whether, to what extent and underwhat circumstances Awards may be settled or exercised in cash, Shares, othersecurities, other Awards or other property or canceled, forfeited or suspended;(vi) determine whether, to what extent and under what circumstances cash,Shares, other securities, other Awards, other property and other amountspayable with respect to an Award shall be deferred either automatically or atthe election of the holder thereof or of the Committee; (vii) interpretand administer the Plan and any instrument or agreement relating to, or Awardor Director Option made under, the Plan; (viii) establish, amend, suspend orwaive such rules and regulations and appoint such agents as it shall deemappropriate for the proper administration of the Plan; and (ix) make anyother determination and take any other action that the Committee deemsnecessary or desirable for the administration of the Plan.

 

(b)           Unless otherwise expressly provided in thePlan, all designations, determinations, interpretations and other decisionsunder or with respect to the Plan or any Award or Director Option shall bewithin the sole discretion of the Committee, may be made at any time and shallbe final, conclusive and binding upon all Persons, including the Company, anysubsidiary, any Participant, any holder or beneficiary of any Award or DirectorOption, any shareholder and any Employee.

 

SECTION 4.  **SharesAvailable for the Plan**.

 

(a)           *Shares Available.* Subject to adjustment as provided in Section 4(b), the number ofShares available for issuance under the Plan shall be 1,650,000. If any Sharescovered by an Award or Director Option granted under the Plan, or to which suchan Award or Director Option relates, or any Shares issued underSection 10, are forfeited, or if an Award or Director Option otherwiseterminates or is canceled without the delivery of Shares, then the Shares whichmay be issued under this Plan, to the extent of any such settlement,forfeiture, termination or cancellation, shall again be, or shall become,Shares available for issuance, to the extent permissible under Rule l6b-3.  In the event that any Option, DirectorOption or other Award granted hereunder is exercised through the delivery ofShares, the number of Shares available under the Plan shall be increased by thenumber of Shares surrendered, to the extent permissible under Rule l6b-3.

 

(b)           *Adjustments.*  In theevent that any dividend or other distribution (whether in the form of cash,Shares, other securities or other property), recapitalization, stock split,reverse stock split, reorganization, merger, consolidation, split-up, spin-off,combination, repurchase, or exchange of Shares or other securities of theCompany, issuance of warrants or other rights to purchase Shares or othersecurities of the Company, or other similar corporate transaction or eventaffects the Shares such that an adjustment is necessary in order to preventdilution or enlargement of the benefits or potential benefits intended to bemade available under the Plan, then the Committee shall proportionately adjustany or all (as necessary) of (i) the number of Shares or other securitiesof the Company (or number and kind of other securities or property) which maybe issued under the Plan; (ii) the number of Shares or other securities ofthe Company (or number and kind of other securities or property) subject tooutstanding Awards; (iii) the number of Shares or other securities

 

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of the Company (or number andkind of other securities or property) and the purchase price per Share subjectto purchase under Section 10 hereof; and (iv) the grant or exerciseprice with respect to any Award; provided, in each case, that with respect toAwards of Incentive stock Options, no such adjustment shall be authorized tothe extent that such authority would cause the Plan to violateSection 422(b)(1) of the Code, as from time to time amended.  If, pursuant to the preceding sentence, anadjustment is made to outstanding Options held by Participants, a correspondingadjustment shall be made to outstanding Director Options and if, pursuant tothe preceding sentence, an adjustment is made to the number of Sharesauthorized for issuance under the Plan, a corresponding adjustment shall bemade to the number of Shares subject to each Director Option thereafter grantedpursuant to paragraph (iii) or paragraph (iv) of Section 6(e).  [Last sentence of Section 4(b) amendedeffective September 7, 2001.]

 

(c)           *Sources of Shares*.  AnyShares issued pursuant to the terms of this Plan may consist, in whole or inpart, of authorized and unissued Shares or of treasury Shares.

 

SECTION 5.  **Eligibilityfor Awards and Director Options.** Any Employee, including any officer or employee-director of the Companyor any Subsidiary, who is not a member of the Committee, shall be eligible tobe designated a Participant for purposes of receiving an Award under thePlan.  Each Eligible Director shall beeligible to receive Director Options in accordance with Section 6(e)hereof.  [Last sentence of Section 5amended effective August 18, 1999.]

 

SECTION 6.  **Options andDirector Options.**

 

(a)           *Grant*.  Subjectto the provisions of the Plan, the Committee shall have sole and completeauthority to determine the Employees to whom Options shall be granted, thenumber of Shares to be covered by each Option, the option price therefor andthe conditions and limitations applicable to the exercise of the Option.  The Committee shall have the authority togrant Incentive Stock Options or to grant Non-Qualified Stock Options or togrant both types of options.  In the caseof Incentive Stock Options, the terms and conditions of such grants shall besubject to, and comply with, such rules as may be prescribed bySection 422 of the Code, as from time to time amended, and any regulationsimplementing such statute, including, without limitation, the requirements ofCode Section 422(d) which limit the aggregate Fair Market Value of Sharesfor which Incentive Stock Options are exercisable for the first time to$100,000 per calendar year.  Eachprovision of the Plan and of each written option agreement relating to anOption designated as an Incentive Stock Option shall be construed so that suchOption qualifies as an Incentive Stock Option, and any provision that cannot beso construed shall be disregarded.

 

(b)           *Exercise Price*.  TheCommittee shall establish the exercise price at the time each Option isgranted, which price, except in the case of Options that are Substitute Awards,shall not be less than 100% of the per Share Fair Market Value on the date ofgrant.  Notwithstanding any provisioncontained herein, in the case of an Incentive Stock Option, the exercise priceat the time such Incentive Stock Option is granted to any Employee who, at thetime of such grant, is a Ten Percent Shareholder, shall not be less than 110%of the per Share Fair Market Value on the date of grant.

 

(c)           *Exercise*.  EachOption shall be exercisable at such times and subject to such terms andconditions as the Committee may, in its sole discretion, specify in theapplicable Award Agreement or thereafter; provided, in the case of an IncentiveStock Option, a Participant may not exercise such Incentive Stock Option after(i) the date which is ten years (five years in the case of a Participantwho is a Ten Percent Shareholder) after the date on which such Incentive StockOption is granted; or (ii) the date which is three months (twelve monthsin the case of a Participant who becomes disabled, as defined inSection 22(e)(3) of the Code, or who dies) after the date on which heceases to be an Employee of the Company or a Subsidiary.  The Committee may impose such conditionswith respect to the exercise of Options, including without limitation, anyrelating to the application of federal or state securities laws, as it may deemnecessary or advisable.  The Committeeshall have the right to accelerate the exercisability of any Option oroutstanding Option in its discretion. Notwithstanding anything herein or in any Award Agreement to thecontrary, in the event the Company merges with another Person and the Companyis not the survivor in the merger, or in the event all or substantially all ofthe Company’s assets or stock is acquired by another Person (a “Change inControl”), each Option granted on or after May 1, 1996 and which has notexpired, been cancelled or been exercised prior to the effective date of suchChange in Control, shall immediately vest and become exercisable in full.  [Last sentence added February 17,2004.]

 

(d)           *Payment*.  No Sharesshall be delivered pursuant to any exercise of an Option until payment in fullof the option price therefor is received by the Company.  Such payment may be made in cash, or itsequivalent or, if and to the extent permitted by the Committee, by exchangingShares owned by the optionee (which are not the subject of any pledge or othersecurity interest) or by a combination of the foregoing, provided that thecombined value of all cash and cash equivalents and the Fair Market Value ofany such Shares so tendered to the Company as of the date of such tender is atleast equal to such option price.

 

(e)           *Director Options*.

 

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(i)            On March 7, 1997,each individual then serving as an Eligible Director was granted an immediatelyexercisable Director Option to purchase 2,000 Shares at an exercise price perShare equal to the Fair Market Value on the date of grant.

 

(ii)           On August 19, 1998,each individual then serving as an Eligible Director was granted a DirectorOption to purchase 20,000 Shares at an exercise price per share equal to theFair Market Value on the date of grant. Each Director Option granted on August 19, 1998 shall vest and becomeexercisable as follows: (A) with respect to 20% of the Shares covered therebyon the grant date; and (B) with respect to an additional 20% of the Sharescovered thereby on each of the first, second, third and fourth anniversaries ofthe grant date.

 

(iii)          Any individual whois a newly-elected or appointed Eligible Director after August 19, 1998 shallbe granted a Director Option to purchase 20,000 Shares effective on the date ofhis appointment or election to the Board. Each Director Option granted in accordance with this paragraph (iii) ofSection 6(e) shall be granted at an exercise price per Share equal to the FairMarket Value on the date of grant.  Inaddition, each such Director Option shall vest and become exercisable asfollows: (A) with respect to 20% of the Shares covered thereby on the grantdate; and (B) with respect to an additional 20% of the Shares covered therebyon each of the first, second, third and fourth anniversaries of the grant date.

 

(iv)          On the firstbusiness day of each fiscal year of the Company commencing January 1,2002, each individual who (A) is then serving as an Eligible Director and (B)has served for at least one full one-year term as an Eligible Director, willautomatically be granted a Director Option to purchase 4,000 Shares at anexercise price per share equal to the Fair Market Value on the grant date.  Each such Director Option shall vest andbecome exercisable as follows: (X) with respect to 20% of the Sharescovered thereby on the grant date; and (Y) with respect to an additional 20% ofthe Shares covered thereby on each of the first, second, third and fourthanniversaries of the grant date. [Paragraph (iv) added effective September 7, 2001.]

 

(v)           The Board shallhave the sole and complete authority to grant Director Options to the EligibleDirectors in addition to those nondiscretionary Director Options granted inaccordance with paragraphs (i) through (iv) of this Section 6(e).  The Board shall have the authority todetermine the date of grant of each such Director Option, the number of Sharescovered by each such Director Option, and the date or dates when each suchDirector Option becomes exercisable.  Any Director Option granted by the Board shall be granted at anexercise price per Share equal to the Fair Market Value on the date ofgrant.  [First sentence of paragraph amendedand paragraph redesignated from (iv) to (v) effective September 7, 2001.]

 

(vi)          Each DirectorOption granted to an Eligible Director on or after August 18, 1999 shall becomeimmediately exercisable in full (A) by the Eligible Director if he retires fromservice as a director of the Company, (B) by the Eligible Director if he becomesdisabled within the meaning of Section 22(e)(3) of the Code or (C) upon thedeath of an Eligible Director, by the Eligible Director’s estate or by theperson who acquires the right to exercise the Director Options of the EligibleDirector upon his death by bequest or inheritance.  [Paragraph redesignated from (v) to (vi) effectiveSeptember 7, 2001.]

 

(vii)                 Once vested andexercisable, each Director Option shall remain exercisable until the earlier tooccur of the following two dates: (A) the tenth anniversary of the date ofgrant of such Director Option; or (B) three months (twelve months in the caseof an Eligible Director who becomes disabled, as defined in Section 22(e)(3) ofthe Code, or who dies) after the date the Eligible Director ceases to be a memberof the Board, except that if the Eligible Director ceases to be a member of theBoard after having been convicted of, or pled guilty or nolo contendere to, afelony, each of his Director Options shall be canceled on the date he ceases tobe a member of the Board.  [Paragraphredesignated from (vi) to (vii) effective September 7, 2001.]

 

(viii)              In the event theCompany merges with another Person and the Company is not the survivor in themerger, or in the event all or substantially all of the Company’s assets orstock is acquired by another Person, each Director Option shall immediatelyvest and become exercisable in full. [Paragraph redesignated from (vii) to (viii) effective September 7,2001.]

 

(ix)           An EligibleDirector may pay the exercise price of a Director Option in the mannerdescribed in Section 6(d). [Paragraph redesignated from (viii) to (ix) effective September 7,2001.]

 

SECTION 7.  **RestrictedStock**.

 

(a)           *Grant*.  Subjectto the provisions of the Plan, the Committee shall have sole and completeauthority to determine the Employees to whom Shares of Restricted Stock shallbe granted, the number of Shares of Restricted Stock to be granted to eachParticipant, the duration of the period during which, and the conditions underwhich, the Restricted Stock will vest and no longer be subject to forfeiture tothe Company and the other terms and conditions of such Awards.  The

 

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Committee shall have the rightto accelerate the vesting of any Restricted Stock or outstanding RestrictedStock in its discretion.

 

(b)           *Transfer Restrictions*. Until the lapse of applicable restrictions, Shares of Restricted Stockmay not be sold, assigned, transferred, pledged or otherwise encumbered exceptas provided in the Plan or the applicable Award Agreements.  Certificates issued in respect of Shares ofRestricted Stock shall be registered in the name of the Participant anddeposited by such Participant, together with a stock power endorsed in blank,with the Company.  Upon the lapse of therestrictions applicable to such Shares of Restricted Stock, the Company shalldeliver such certificates to the Participant or the Participant’s legalrepresentative.

 

(c)           *Payment of Dividends*. Dividends paid on any Shares of Restricted Stock may be paid directly tothe Participant, or may be reinvested in additional Shares of Restricted Stock,as determined by the Committee in its sole discretion.

 

SECTION 8.  **PerformanceAwards**.

 

(a)           *Grant*.  TheCommittee shall have sole and complete authority to determine the Employees whoshall receive a Performance Award denominated in cash or Shares;(i) valued, as determined by the Committee, in accordance with theachievement of such performance goals during such performance periods as theCommittee shall establish; and (ii) payable at such time and in such formas the Committee shall determine.

 

(b)           *Terms and Conditions*. Subject to the terms of the Plan and any applicable Award Agreement, theCommittee shall determine the performance goals to be achieved during anyperformance period, the length of any performance period, the amount of anyPerformance Award and the amount and kind of any payment or transfer to be madepursuant to any Performance Award.

 

(c)           *Payment of Performance Awards*.  Performance Awards may be paid in a lump sumor in installments following the close of the performance period or, inaccordance with procedures established by the Committee, on a deferred basis.

 

SECTION 9.  **CodeSection 162(m) Limitations.**

 

(a)           *General Limitations*.  AnyAwards issued under this Plan to Covered Employees must satisfy therequirements of this Section 9.

 

(b)           *Requirements For All Awards*.  Any Award issued to a Covered Employee shallconstitute qualified performance-based compensation.  For this purpose, an Award shall constitute qualifiedperformance-based compensation to the extent that:

 

(i)  it is granted by the Committee on account ofthe attainment of one or more preestablished, objective performance goalsestablished by the Committee, in accordance with the provisions ofSection 1.162-27(e)(2) of the Final Regulations;

 

(ii)  the material terms of the performance goalunder which the Award is issued are disclosed to and subsequently approved bythe shareholders of the Company, in accordance with the provisions ofSection 1.162-27(e)(4) of the Final Regulations; and

 

(iii)  the Committee certifies, in writing, priorto the payment of any compensation under the Award, that the performance goalsand any other material terms were in fact satisfied.

 

(c)           *Special Rules For Options*.  Thegrant of an Option to a Covered Employee under the Plan shall satisfy therequirements of Section 9(b)(i) above to the extent that the followingrequirements are satisfied:

 

(i)            subject to theprovisions of Section 4(b), no Covered Employee shall receive Options formore than 200,000 Shares over any one-year period.  For this purpose, to the extent that any Option is canceled (asdescribed in Section 1.162-27(e)(2)(vi)(B) of the Final Regulations), suchcanceled Option shall continue to be counted against the maximum number ofShares for which Options may be granted to a Covered Employee under the Plan;and

 

(ii)           under the terms ofthe Option, the amount of compensation that the Covered Employee may receive isbased solely on an increase in the value of the Shares after the grant of theOption, unless

 

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the grant of such Option is contingent upon theattainment of a performance goal that otherwise satisfies the requirements ofSection 9(b)(i) above.

 

SECTION 10. **StockPurchase Plan.**

 

(a)           *Eligibility*.  EachEmployee whose employment with the Company or a Subsidiary commenced prior toan Offering Effective Date shall be eligible to participate in the Offeringwhich is applicable to such Offering Effective Date.  Nothing contained herein and no rules and regulations prescribedby the Committee shall permit or deny participation in any Offering contrary tothe requirements of the Code (including, without limitation, Sections 423(b)(3),423(b)(4) and 423(b)(8) thereof). Nothing contained herein and no rules and regulations prescribed by theCommittee shall permit any Participant to be granted a Right to Purchase:

 

(i)            if, immediatelyafter such Right to Purchase is granted, such Participant would own, and/orhold outstanding options or rights to purchase, shares of the Company or of anySubsidiary, possessing five percent (5%) or more of the total combined votingpower or value of all classes of shares of the Company or such Subsidiary; or

 

(ii)           which permits a Participant’s rights topurchase Shares under all employee stock purchase plans of the Company and ofits Subsidiaries to accrue at a rate which exceeds Twenty-Five Thousand Dollars($25,000.00) of Fair Market Value of Shares (determined as of the date suchRight to Purchase is granted) for each calendar year in which such Right toPurchase is outstanding at any time.

 

For purposes of clause (a)(i) above, theprovisions of Section 424(d) of the Code shall apply in determining thestock ownership of each Participant. For purposes of clause (a)(ii) above, the provisions ofSection 423(b)(8) of the Code shall apply in determining whether aParticipant’s Rights to Purchase and other rights are permitted to accrue at arate in excess of the permitted rate.

 

[First sentence of Section 10(a) amendedFebruary 17, 2004.]

 

(b)           *Purchase Price*.  Thepurchase price for a Share under each Offering shall be determined by theCommittee prior to the Offering Effective Date and shall be stated as apercentage of the Fair Market Value of a Share on either the Right to PurchaseDate or the Offering Effective Date, whichever is the lesser, but the purchaseprice shall not be less than the lesser of eighty-five percent (85%) of the pershare Fair Market Value of the Shares as of the Offering Effective Date oreighty-five percent (85%) of the per share Fair Market Value of the Shares asof the Right to Purchase Date for the Offering.

 

(c)           *Participation in Offerings.*  Except as may be otherwise provided forherein, each Employee who is eligible for and elects to participate in anOffering shall be granted Rights to Purchase for as many Shares as he may electto purchase during that Offering, to be paid by payroll deductions during suchperiod.  The Committee shall establishadministrative rules and regulations regarding the payroll deduction processfor this Section 10, including, without limitation, minimum and maximumpermissible deductions; the timing for initial elections, changes in electionsand suspensions of elections during an Offering Period; and the completewithdrawal by a Participant from an Offering. Amounts withheld through payroll deductions under this paragraph shallbe credited to each Participant’s Cash Account.  Such amounts will be delivered to a custodian for the Plan andheld pending the purchase of Shares as described in paragraph (e) of thisSection 10.  All amounts held in aParticipant’s Cash Account shall bear interest at a rate as may be agreed uponby the Committee and the custodian of the Plan.  If a Participant withdraws entirely from an Offering (pursuant torules established by the Committee), his Cash Account balance will not be usedto purchase Shares on the Right to Purchase Date.  Instead, the portion of the Cash Account equal to theParticipant’s payroll deductions under the Plan during the Offering Period willbe refunded to the Participant without interest (notwithstanding any provisioncontained herein).  Such a Participant willnot be eligible to re-enroll in that Offering, but may resume participation onthe Offering Effective Date for the next Offering.  In addition, the Committee may impose such other restrictions onthe right to withdraw from Offerings as it may deem appropriate.

 

(d)           *Grant of Rights to Purchase.*  Rights to Purchase with respect to Sharesshall be granted to Participants who elect to participate in an Offering.  Such Rights to Purchase may be exercised onthe Right to Purchase Date applicable to the Offering.  The number of Shares subject to Rights toPurchase on each Right to Purchase Date shall not exceed the number of Sharesauthorized for issuance during the applicable Offering.

 

(e)           *Exercise of Rights to Purchase*.  Each Right to Purchase shall be exercised onthe applicable Right to Purchase Date. Each Participant automatically and without any act on his part will bedeemed to have exercised a Right to Purchase on each Right to Purchase Date topurchase the number of whole and fractional Shares which the amount in his CashAccount at that time is sufficient to purchase at the applicable purchaseprice.  Any remaining amount credited toa Participant’s Cash Account after such application shall remain in suchParticipant’s Cash Account for use in the next Offering unless withdrawn by theParticipant.  The Company shall deliverto the custodian of the Plan as soon as practicable after each Right toPurchase Date a certificate for the total number of Shares purchased by allParticipants on such Right to

 

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Purchase Date.  The custodian shall allocate the propernumber of Shares to the Share Account of each Participant.  If the aggregate Cash Account balances ofall Participants on any Right to Purchase Date exceeds the amount required topurchase all of the Shares subject to Rights to Purchase on that Right toPurchase Date, then the Shares subject to Rights to Purchase shall be allocatedpro rata among the Participants in the proportion that the number of Sharessubject to Rights to Purchase bears to the number of Shares that could havebeen purchased with such aggregate amount available, if an unlimited number ofShares were available for purchase.  Anybalances remaining in Participants’ Cash Accounts due to over subscription willremain in the Participants’ Cash Accounts for use in the next Offering unlesswithdrawn by the Participant.

 

(f)            *Withdrawals From Share Accounts and Dividend Reinvestment*.  A Participant may withdraw the Sharescredited to his Share Account on a first-in-first-out basis.  The Committee shall establish rules andregulations governing such withdrawals. All cash dividends paid, if any, with respect to the Shares credited toa Participant’s Share Account shall be added to the Participant’s Cash Accountand thereby shall be applied to exercise Rights to Purchase for Shares on theRight to Purchase Date next succeeding the date such cash dividends are paid bythe Company.  An election to leaveShares with the custodian shall constitute an election to apply the cashdividends with respect to such Shares to the exercise of Rights to Purchasehereunder.  Shares so purchased shall beapplied to the Shares credited to each Participant’s Share Account.

 

(g)           *Termination of Employment.*  Ifthe employment of a Participant terminates for any reason, including death,disability, retirement or other cause, his participation in thisSection 10 of the Plan shall automatically and without any act on his partterminate as of the date of termination of his employment.  As soon as practicable following theParticipant’s termination of employment, the Company shall refund to suchParticipant (or beneficiary, in the case of the Participant’s death) any amountin his Cash Account which constitutes payroll deductions, without interest, andthe custodian shall deliver to such Participant a share certificate issued inhis name for the number of whole Shares credited to his Share Account throughprior Offerings.

 

(h)           *Effect of Merger or Liquidation Involving the Company.*  In the event the Company merges with anotherentity and the Company is not the surviving entity, or in the event all orsubstantially all of the Company’s assets or stock is acquired by anotherentity, the Committee may, in connection with any such transaction, cancel eachoutstanding Right to Purchase and refund sums previously collected fromParticipants under the canceled Rights to Purchase, or, in its discretion,cause each Participant with outstanding Rights to Purchase to have his or herRights to Purchase exercised immediately prior to such transaction and therebythe balance of his or her Cash Account applied to the purchase of Shares at thepurchase price in effect for that Offering, which would be treated as endingwith the effective date of such transaction. The balances of the Cash Accounts not so applied shall be refunded tothe Participants.  In the event of amerger in which the Company is the surviving entity, each Participant shall beentitled to receive, for each Share as to which such Participant’s Rights toPurchase are exercised, the securities or property that a holder of one Sharewas entitled to receive in connection with the merger.  To the extent that this paragraph isinconsistent with any other provision in this Plan, this paragraph shallcontrol.

 

SECTION 11. **Amendmentand Termination.**

 

(a)           *Amendments to the Plan.*  TheBoard may amend, alter, suspend, discontinue or terminate the Plan or anyportion thereof at any time; provided that no such amendment, alteration,suspension, discontinuation or termination shall be made without shareholderapproval if such approval is necessary to comply with any tax or regulatoryrequirement, including for these purposes any approval requirement which is aprerequisite for exemptive relief from Section 16(b) of the Exchange Actfor which or with which the Board deems it necessary or desirable to qualify orcomply.  Notwithstanding anything to thecontrary herein, the Committee may amend the Plan, subject to any shareholderapproval required under Rule l6b-3, in such manner as may be necessary so as tohave the Plan conform with local rules and regulations in any jurisdictionoutside the United States.

 

(b)           *Amendments to Awards.* Subject to the provisions of Section 9, the Committee may waive anyconditions or rights under, amend any terms of, or alter, suspend, discontinue,cancel or terminate any Award theretofore granted, prospectively orretroactively; provided that any such waiver, amendment, alteration,suspension, discontinuance, cancellation or termination that would impair the rightsof any Participant or any holder or beneficiary of any Award theretoforegranted shall not to that extent be effective without the consent of theaffected Participant, holder or beneficiary.

 

(c)           *Cancellation of Award.*  Anyprovision of this Plan (except Section 9) or any Award Agreement to thecontrary notwithstanding, the Committee may cause any Award granted hereunderto be canceled in consideration of the granting to the holder of an alternativeAward having a Fair Market Value equal to the Fair Market Value of suchcanceled Award.

 

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SECTION 12. **GeneralProvisions.**

 

(a)           *Nontransferability.*

 

(i)  Each Award, each Director Option and eachRight to Purchase, and each right under any Award, any Director Option or anyRight to Purchase, shall be exercisable during the Participant’s or theEligible Director’s lifetime only by the Participant or the Eligible Directoror, if permissible under applicable law, by the Participant’s or the EligibleDirector’s guardian or legal representative or a transferee receiving suchAward, Director Option or Right to Purchase pursuant to a qualified domesticrelations order (“QDRO”), as determined by the Committee.

 

(ii)  No Award, Director Option or Right toPurchase that constitutes a “derivative security,” for purposes ofSection 16 of the Exchange Act, may be assigned, alienated, pledged,attached, sold or otherwise transferred or encumbered by a Participant orEligible Director otherwise than by will or by the laws of descent anddistribution or pursuant to a QDRO, and any such purported assignment,alienation, pledge, attachment, sale, transfer or encumbrance shall be void andunenforceable against the Company or any Subsidiary; provided that thedesignation of a beneficiary shall not constitute an assignment, alienation,pledge, attachment, sale, transfer or encumbrance.

 

(b)           *No Rights to Awards.*  NoEmployee, Participant or other Person shall have any claim to be granted anyAward, and there is no obligation for uniformity of treatment of Employees,Participants or holders or beneficiaries of Awards.  The terms and conditions of Awards need not be the same withrespect to each recipient.

 

(c)           *Share Certificates.*  Allcertificates for Shares or other securities of the Company or any Subsidiarydelivered under the Plan shall be subject to such stop transfer orders andother restrictions as the Committee may deem advisable under the Plan or therules, regulations and other requirements of the SEC, any stock exchange or nationalsecurities association upon which such Shares or other securities are thenlisted and any applicable federal or state laws; and the Committee may cause alegend or legends to be put on any such certificates to make appropriatereference to such restrictions.

 

(d)           *Withholding.*  AParticipant or Eligible Director may be required to pay to the Company or anySubsidiary and the Company or any Subsidiary shall have the right and is herebyauthorized to withhold from any Award, Director Option or Share otherwiseissued under the Plan, from any payment due or transfer made under any Award orany Director Option or otherwise under the Plan, or from any compensation orother amount owing to a Participant or Eligible Director, the amount of anyapplicable withholding taxes in respect of an Award, a Director Option or aShare otherwise issued under the Plan, its exercise or any payment or transferunder an Award, under a Director Option or otherwise under the Plan and to takesuch other action as may be necessary in the opinion of the Company to satisfyall obligations for the payment of such taxes. With respect to Participants who are not subject to Section 16 ofthe Exchange Act, the withholding may be in the form of cash, Shares, othersecurities, other Awards or other property as the Committee may allow.  With respect to Participants and EligibleDirectors who are subject to Section 16 of the Exchange Act, thewithholding shall be in cash or in any other property permitted by Rule 16b-3as the Committee may allow.  TheCommittee may provide for additional cash payments to Participants or EligibleDirectors to defray or offset any tax arising from the grant, vesting, exerciseor payments of any Award or Share otherwise issued under this Plan.

 

(e)           *Award Agreements.*  EachAward hereunder shall be evidenced by an Award Agreement which shall bedelivered to the Participant and shall specify the terms and conditions of theAward and any rules applicable thereto, including but not limited to the effecton such Award of the death, retirement or other termination of employment of aParticipant and the effect, if any, of a change in control of the Company.

 

(f)            *No Limit on Other Compensation Arrangements. *Nothing contained in the Plan shall preventthe Company or any Subsidiary from adopting or continuing in effect othercompensation arrangements, which may, but need not, provide for the grant ofoptions, restricted stock, shares and other types of awards provided forhereunder (subject to shareholder approval if such approval is required), andsuch arrangements may be either generally applicable or applicable only inspecific cases.

 

(g)           *No Right to Employment.* Eligibility for participation in this Plan or the grant of an Awardshall not be construed as giving a Participant the right to be retained in theemploy of the Company or any Subsidiary. Further, the Company or a Subsidiary may at any time dismiss aParticipant from employment, free from any liability or any claim under thePlan, unless otherwise expressly provided in the Plan or in any AwardAgreement.

 

(h)           *No Rights as Shareholder.* Subject to the provisions of the Plan and/or the applicable Award, noParticipant or holder or beneficiary of any Award, Director Option or Right toPurchase shall have any rights as a shareholder with respect to any Shares tobe distributed under the Plan until he or she has become the holder of suchShares.

 

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Notwithstanding the foregoing,in connection with each grant of Restricted Stock hereunder, the applicableAward shall specify if and to what extent the Participant shall not be entitledto the rights of a shareholder in respect of such Restricted Stock.

 

(i)            *Governing Law. *The validity,construction and effect of the Plan and any rules and regulations relating tothe Plan and any Award Agreement shall be determined in accordance with thelaws of the State of Ohio.

 

(j)            *Severability.*  Ifany provision of the Plan or any Award is or becomes or is deemed to beinvalid, illegal or unenforceable in any jurisdiction or as to any Person orAward, or would disqualify the Plan or any Award under any law deemedapplicable by the Committee, such provision shall be construed or deemedamended to conform to the applicable laws, or if it cannot be construed ordeemed amended without, in the determination of the Committee, materiallyaltering the intent of the Plan or the Award, such provision shall be strickenas to such jurisdiction, Person or Award and the remainder of the Plan and anysuch Award shall remain in full force and effect.

 

(k)           *Other Laws.*  TheCommittee may refuse to issue or transfer any Shares or other considerationunder the Plan if, acting in its sole discretion, it determines that theissuance or transfer of such Shares or such other consideration might violateany applicable law or regulation or entitle the Company to recover the sameunder Section 16(b) of the Exchange Act, and any payment tendered to theCompany by a Participant, other holder or beneficiary in connection with theissuance of such Shares shall be promptly refunded to the relevant Participant,holder or beneficiary.  Without limitingthe generality of the foregoing, no Award granted hereunder shall be construedas an offer to sell securities of the Company, and no such offer shall beoutstanding, unless and until the Committee in its sole discretion hasdetermined that any such offer, if made, would be in compliance with allapplicable requirements of the U.S. federal securities laws.

 

(l)            *No Trust or Fund Created.* Neither the Plan nor any Award shall create or be construed to create atrust or separate fund of any kind or a fiduciary relationship between theCompany or any Subsidiary and a Participant or any other Person.  To the extent that any Person acquires aright to receive payments from the Company or any Subsidiary pursuant to thePlan, such rights shall be no greater than the right of any unsecured generalcreditor of the Company or any Subsidiary.

 

(m)          *Rule l6b-3 Compliance. *With respect to persons subject to Section 16 of the Exchange Act,transactions under this Plan are intended to comply with all applicable termsand conditions of Rule 16b-3 and any successor provisions.  To the extent that any provision of the Planor action by the Committee fails to so comply, it shall be deemed null andvoid, to the extent permitted by law and deemed advisable by the Committee.

 

(n)           *Headings.*  Headingsare given to the sections and subsections of the Plan solely as a convenienceto facilitate reference.  Such headingsshall not be deemed in any way material or relevant to the construction orinterpretation of the Plan or any provision thereof.

 

(o)           *No Impact on Benefits.*  PlanAwards or Shares otherwise issued under this Plan shall not be treated ascompensation for purposes of calculating an Employee’s rights under anyemployee benefit plan.

 

(p)           *Indemnification.*  Eachperson who is or shall have been a member of the Committee or of the Boardshall be indemnified and held harmless by the Company against and from anyloss, cost, liability or expense that may be imposed upon or reasonablyincurred by him in connection with or resulting from any claim, action, suit orproceeding to which he may be made a party or in which he may be involved byreason of any action taken or failure to act under the Plan and against andfrom any and all amounts paid by him in settlement thereof, with the Company’sapproval, or paid by him in satisfaction of any judgment in any such action,suit or proceeding against him, provided he shall give the Company anopportunity, at its own expense, to handle and defend the same before heundertakes to handle and defend it on his own behalf.  The foregoing right of indemnification shall not be exclusive andshall be independent of any other rights of indemnification to which suchpersons may be entitled under the Company’s Articles of Incorporation orRegulations, by contract, as a matter of law, or otherwise.

 

SECTION 13. **Termof the Plan.**

 

(a)           *Effective Date.*  TheAirNet Systems, Inc. 1996 Stock Incentive Plan was effective as of May 1,1996.  The amendment and restatement ofsuch Plan shall be effective as of the date of its approval by the shareholdersof the Company.

 

(b)           *Expiration Date.*  NoAward or Right to Purchase shall be granted under the Plan after May 1,2006.  Unless otherwise expresslyprovided for in the Plan or in an applicable Award Agreement, any Award grantedhereunder may, and the authority of the Board or the Committee to amend, alter,adjust, suspend, discontinue or terminate any such Award or to waive anyconditions or rights under any such Award shall, continue after May 1, 2006.

 

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