##### 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, 2007
 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
  Large accelerated filer
o
    
    Accelerated filer o
    
    Non-accelerated filer   o
(Do not check if a smaller reporting company)
    
    Smaller reporting company
þ
 o þ
   Class
    
    Outstanding at March 25, 2008Common Shares, $0.01 par value
    
    10,179,671 common shares




---



##### Table of Contents



DOCUMENT INCORPORATED BY REFERENCE
 Document
    
    Part Into Which IncorporatedPortions of the Registrants definitive Proxy
Statement for the 2008 Annual Meeting of
Shareholders, 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, 2007
    
    Part III
 2




---



##### 



INDEX
 PART IItem 1: Business
    
    
    4Item 1A: Risk Factors
    
    
    11Item 1B: Unresolved Staff Comments
    
    
    17Item 2: Properties
    
    
    17Item 3: Legal Proceedings
    
    
    19Item 4: Submission of Matters to a Vote of Security Holders
    
    
    19PART IIItem 5: Market for Registrants Common Equity, Related Stockholder Matters and
Issuer Purchases of Equity Securities
    
    
    19Item 6:
Selected Financial Data
    
    
    19Item 7: Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    20Item 7A:
Quantitative and Qualitative Disclosures About Market Risk
    
    
    38Item 8: Financial Statements and Supplementary Data
    
    
    38Item 9: Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
    
    
    55Item 9A(T): Controls and Procedures
    
    
    55Item 9B: Other Information
    
    
    56PART IIIItem 10: Directors, Executive Officers and Corporate Governance
    
    
    60Item 11: Executive Compensation
    
    
    60Item 12: Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
    
    
    61Item 13: Certain Relationships and Related Transactions, and Director Independence
    
    
    61Item 14: Principal Accountant Fees and Services
    
    
    61PART IVItem 15: Exhibits and Financial Statement Schedules
    
    
    61Signatures
    
    
    72Exhibit Index
    
    
    73EX-4.52EX-10.21EX-10.28EX-10.29EX-21EX-23EX-24EX-31.1EX-31.2EX-32
  3




---



##### Table of Contents



PART I
 
 ITEM 1  BUSINESS
 General
         4




---



##### Table of Contents



Bank Services
   Express Services
   Aviation Services
  Recent Developments
   5




---



##### Table of Contents



Sale of Jetrides Passenger Charter Business
   Accounting for the
Impairment or Disposal of Long-Lived Assets
  Business Strategy
  6




---



##### Table of Contents



Operations
 Air Operations
   7




---



##### Table of Contents



Shipment Processing
   Ground support
  Fast Forward Solutions
  Regulation
  8




---



##### Table of Contents



The Next Generation Air Transportation System Financing Reform Act of 2007 The Next Generation Air Transportation System Financing Reform
Act of 2007 Aviation Investment and Modernization Act of 2007 FAA Reauthorization Act of 2007
  9




---



##### Table of Contents



Seasonality
  Competition
      Environmental matters
   10




---



##### Table of Contents



Employees
  
 ITEM 1A  RISK FACTORS
 Completion of the merger is subject to various customary closing conditions, including the
obtaining of shareholder approval and adoption of the merger and the merger agreement and the
obtaining of any required regulatory approvals.
   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.
  11




---



##### Table of Contents



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 has implemented a new pricing structure for its weekday Bank Services customers. If AirNet
is not successful in implementing this pricing structure, the decline in AirNets Bank Services
revenues will adversely affect AirNets operations.
  AirNet will not be able to offset the accelerating decline in weekday and weekend Bank Services
revenues and contribution margins with Express Services revenues and contribution margins, which
could adversely affect AirNets profitability and require further reductions in AirNets weekday
air transportation network.
  Reductions in AirNets route schedule and the number of aircraft it operates may adversely impact
AirNets Express Services business.
  If AirNet fails to implement its revised business strategy successfully, AirNets business may
suffer.
  12




---



##### Table of Contents



Competition from other providers of express air and ground delivery services may adversely affect
AirNets results of operations and financial condition.
  An economic downturn could result in less demand for AirNets delivery services.
  The U.S. aviation industry is experiencing a shortage of qualified pilots which could adversely
impact AirNets flight schedule and air transportation network.
  13




---



##### Table of Contents



Fuel surcharge revenues may be insufficient to recover fuel cost increases and higher fuel
surcharges may cause customers to consider other transportation alternatives.
  A failure of computer systems could significantly disrupt AirNets business.
  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.
  Proposed legislative changes in the manner in which the FAA is funded by the federal government may
increase AirNets operating costs.
  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.
  14




---



##### Table of Contents



Loss of AirNet Management, Inc.s Indirect Air Carrier Standard Security Program approval could
adversely affect AirNets business.
  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.
  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.
  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.
  15




---



##### Table of Contents



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.
  If AirNet is unable to maintain sufficient liquidity as AirNet continues to implement its business
strategy and other strategic alternatives, AirNet may be unable to sustain its operations.
  Limitations on AirNets ability to borrow could adversely affect AirNets financial condition and
prevent AirNet from fulfilling its financial obligations.
  16




---



##### Table of Contents



AirNet may not be able to raise future capital through debt financing which could adversely affect
AirNets ability to execute its business strategy.
  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.
  Anti-takeover provisions may delay or prevent an acquisition or change in control of AirNet by a
third party.
    
 ITEM 1B  UNRESOLVED STAFF COMMENTS
  
 ITEM 2  PROPERTIES
 Operating facilities
 17




---



##### Table of Contents



Fleet
 Cargo aircraft
  Aircraft Type
    
    Owned (1)
    
    Leased
    
    Payload (2)
    
    Range (3)
    
    Speed (4)Aircraft used in operations:Learjet, Model 35/35A
    
    
    29
    
    
    
    
    
    
    
    3,800
    
    
    
    1,700
    
    
    
    440Cessna Caravan
    
    
    7
    
    
    
    9
    
    
    
    3,400
    
    
    
    825
    
    
    
    160Beech Baron
    
    
    40
    
    
    
    
    
    
    
    1,000
    
    
    
    800
    
    
    
    165Piper Navajo
    
    
    17
    
    
    
    
    
    
    
    1,500
    
    
    
    800
    
    
    
    160Total aircraft
    
    
    93
    
    
    
    9
 
 (1)
    
    In the first quarter of 2008, one Learjet 35 was sold and one Learjet 35 was
damaged and removed from AirNets aircraft fleet, which decreased the total number of owned
Learjets to 27.(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
  18




---



##### Table of Contents

\

ITEM 3  LEGAL PROCEEDINGS
  
 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
  2007
    
    2006Quarter ended
    
    High
    
    Low
    
    High
    
    LowMarch 31
    
    $
    3.47
    
    
    $
    2.85
    
    
    $
    3.76
    
    
    $
    3.17June 30
    
    
    3.69
    
    
    
    3.21
    
    
    
    3.60
    
    
    
    2.82September 30
    
    
    3.45
    
    
    
    2.42
    
    
    
    3.84
    
    
    
    2.80December 31
    
    
    2.54
    
    
    
    1.65
    
    
    
    3.92
    
    
    
    2.91
      ITEM 6  SELECTED FINANCIAL DATA
  19




---



##### Table of Contents



ITEM 7  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 General
  Results of Operations
 Financial Overview
   Net Revenues
 Dollars in 000s
 $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)Net Revenues
    
    2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007Net RevenuesBank Services
    
    $
    99,853
    
    
    $
    112,034
    
    
    $
    (12,181
    )
    
    
    (11
    )%Express Services
    
    
    58,163
    
    
    
    59,187
    
    
    
    (1,024
    )
    
    
    (2
    )%Aviation Services
    
    
    3,013
    
    
    
    1,586
    
    
    
    1,427
    
    
    
    90
    %Total Net Revenues
    
    $
    161,029
    
    
    $
    172,807
    
    
    $
    (11,778
    )
    
    
    (7
    )%
     20




---



##### Table of Contents



Bank Services Revenues
 Dollars in 000s
 $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)Bank Services Revenues
    
    2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007Bank Services Revenues
    
    $
    84,080
    
    
    $
    96,773
    
    
    $
    (12,693
    )
    
    
    (13
    )%Fuel Surcharge
    
    
    15,773
    
    
    
    15,261
    
    
    
    512
    
    
    
    3
    %Total Net Bank Services Revenues
    
    $
    99,853
    
    
    $
    112,034
    
    
    $
    (12,181
    )
    
    
    (11
    )%Revenues before fuel surcharge:Weekday Revenues Per Flying Day
    
    $
    401
    
    
    $
    459
    
    
    $
    (58
    )
    
    
    (13
    )%Weekend Revenues Per Weekend
    
    $
    116
    
    
    $
    147
    
    
    $
    (31
    )
    
    
    (21
    )%
    Bank Services Cancellations
  21




---



##### Table of Contents



Express Services Revenues
 Dollars in 000s
 $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)Express Services Revenues
    
    2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007Express Revenues  Non Charter
    
    $
    35,450
    
    
    $
    36,542
    
    
    $
    (1,092
    )
    
    
    (3
    )%Express Revenues  Charters
    
    
    15,047
    
    
    
    13,829
    
    
    
    1,218
    
    
    
    9
    %Fuel Surcharge
    
    
    7,666
    
    
    
    8,816
    
    
    
    (1,150
    )
    
    
    (13
    )%Total Net Express Services Revenues
    
    $
    58,163
    
    
    $
    59,187
    
    
    $
    (1,024
    )
    
    
    (2
    )%
  Express Revenues  Non Charter
    22




---



##### Table of Contents



Express Revenues  Charter
   Aviation Services
  Sale of Jetrides Passenger Charter Business
   23




---



##### Table of Contents



Accounting for the
Impairment or Disposal of Long-Lived Assets,
  Costs and Expenses
 Dollars in 000s
 $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)Operating Costs and Expenses
    
    2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007Aircraft fuel
    
    $
    25,473
    
    
    $
    27,909
    
    
    $
    (2,436
    )
    
    
    (9
    )%Aircraft maintenance
    
    
    23,136
    
    
    
    17,998
    
    
    
    5,138
    
    
    
    29
    %Operating wages and benefits
    
    
    19,127
    
    
    
    19,071
    
    
    
    56
    
    
    
    0
    %Contracted air costs
    
    
    16,041
    
    
    
    16,550
    
    
    
    (509
    )
    
    
    (3
    )%Ground courier
    
    
    32,841
    
    
    
    35,248
    
    
    
    (2,407
    )
    
    
    (7
    )%Depreciation
    
    
    4,685
    
    
    
    9,700
    
    
    
    (5,015
    )
    
    
    (52
    )%Insurance, rent and landing fees
    
    
    8,409
    
    
    
    8,639
    
    
    
    (230
    )
    
    
    (3
    )%Travel, training and other operating
    
    
    6,579
    
    
    
    5,468
    
    
    
    1,111
    
    
    
    20
    %Selling, general and administrative
    
    
    17,654
    
    
    
    17,939
    
    
    
    (285
    )
    
    
    (2
    )%Net gain on disposition of assets
    
    
    (890
    )
    
    
    (140
    )
    
    
    (750
    )
    
    

    
*Operating costs and expenses before
impairment charges
    
    
    153,055
    
    
    
    158,382
    
    
    
    (5,327
    )
    
    
    (3
    )%Impairment of property and equipment
    
    
    2,216
    
    
    
    24,560
    
    
    
    (22,344
    )
    
    

    
*Total Costs and Expenses
    
    $
    155,271
    
    
    $
    182,942
    
    
    $
    (27,671
    )
    
    
    (15
    )%
 
 *
    
    The percentage increase (decrease) is not meaningful. Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)Hours Flown
    
    2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007AirNet Aircraft Hours Flown  Total
    
    
    75,412
    
    
    
    84,760
    
    
    
    (9,348
    )
    
    
    (11
    )%
 Aircraft Fuel
  Aircraft Maintenance
  24




---



##### Table of Contents



Operating Wages and Benefits
  Contracted Air Costs
 Dollars in 000s
 Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)Contracted Air Costs
    
    2007
    
    
    2006
    
    
    2005 to 2006
    
    
    2005 to 2006Back-up and subcontracted air routes
    
    $
    9,909
    
    
    $
    9,739
    
    
    $
    170
    
    
    
    2
    %Commercial freight
    
    
    6,132
    
    
    
    6,811
    
    
    
    (679
    )
    
    
    (10
    )%Total Contracted Air Costs
    
    $
    16,041
    
    
    $
    16,550
    
    
    $
    (509
    )
    
    
    (3
    )%
  25




---



##### Table of Contents



Ground Courier
 Dollars in 000s
 Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)Ground Courier Costs
    
    2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007AirNet courier and supervision
    
    $
    3,014
    
    
    $
    3,076
    
    
    $
    (62
    )
    
    
    (2
    )%Contracted courier:Bank Services
    
    
    13,087
    
    
    
    14,228
    
    
    
    (1,141
    )
    
    
    (8
    )%Express Services
    
    
    16,740
    
    
    
    17,944
    
    
    
    (1,204
    )
    
    
    (7
    )%Total Ground Courier Costs
    
    $
    32,841
    
    
    $
    35,248
    
    
    $
    (2,407
    )
    
    
    (7
    )%Bank contracted courier costs as a
percentage of Bank Services revenues,
including fuel surcharge revenues:
    
    
    13
    %
    
    
    13
    %Express contracted courier costs as a
percentage of Express Services revenues,
including fuel surcharge revenues:
    
    
    29
    %
    
    
    30
    %
  Depreciation
 Dollars in 000s
 $ Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)Depreciation Expense
    
    2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007Aircraft
    
    $
    1,064
    
    
    $
    826
    
    
    $
    238
    
    
    
    29
    %Aircraft improvements,
engines, inspections
    
    
    2,946
    
    
    
    7,649
    
    
    
    (4,703
    )
    
    
    (61
    )%Leasehold improvements, computers,
furniture, fixtures, and equipment
    
    
    675
    
    
    
    1,225
    
    
    
    (550
    )
    
    
    (45
    )%Total Depreciation
    
    $
    4,685
    
    
    $
    9,700
    
    
    $
    (5,015
    )
    
    
    (51
    )%
  Insurance, Rent and Landing Fees
  26




---



##### Table of Contents



Travel, Training and Other Operating
  Selling, General and Administrative
  Net Gain on Disposition of Assets
     Impairment Charges
 Accounting for the Impairment or Disposal of Long-Lived
Assets
 2007 Asset Impairment Charge
  27




---



##### Table of Contents



2006 Asset Impairment Charge
  Interest Expense
 Dollars in 000s
 Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007Interest expense
    
    $
    251
    
    
    $
    1,532
    
    
    $
    (1,281
    )
    
    
    (84
    )%Average annual interest rate
    
    
    8.1
    %
    
    
    7.8
    %
  28




---



##### Table of Contents



Income Taxes
 Dollars in 000s
 Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007Income (loss) from continuing operations
before income taxes
    
    $
    5,507
    
    
    $
    (11,667
    )
    
    $
    17,174
    
    
    
    147
    %Provision for income taxes
    
    
    2,100
    
    
    
    1,654
    
    
    
    446
    
    
    
    27
    %Effective Income Tax Rate
    
    
    38.1
    %
    
    
    (14.2
    )%
  Accounting for Income Taxes
 Net Income (Loss) and Earnings (Loss) Per Common Share
  Dollars in 000s
 Increase
    
    
    % Increase(Decrease)
    
    
    (Decrease)2007
    
    
    2006
    
    
    2006 to 2007
    
    
    2006 to 2007Income (loss) from continuing operations
before income taxes
    
    $
    5,507
    
    
    $
    (11,667
    )
    
    $
    17,174
    
    
    
    147
    %Provision for income taxes
    
    
    2,100
    
    
    
    1,654
    
    
    
    446
    
    
    
    27
    %Income from discontinued operations
    
    
    
    
    
    
    29
    
    
    
    (29
    )
    
    

    
*Net Income (Loss)
    
    $
    3,407
    
    
    $
    (13,292
    )
    
    $
    17,591
    
    
    
    132
    %Number of common shares outstanding:Basic
    
    
    10,171
    
    
    
    10,158
    
    
    
    13
    
    
    
    0
    %Diluted
    
    
    10,171
    
    
    
    10,158
    
    
    
    13
    
    
    
    0
    %Net income (loss) per common share  basic and diluted:Continuing operations
    
    $
    0.33
    
    
    $
    (1.31
    )Discontinued operations
    
    
    
    
    
    
    Net income (loss) per common share
    
    $
    0.33
    
    
    $
    (1.31
    )
 
 *
    
    The percentage decrease is not meaningful. Liquidity and Capital Resources
 Cash flow from operating activities  Continuing Operations
  29




---



##### Table of Contents



Cash flow from operating activities  Discontinued Operations
  Financing Activities  Continuing Operations
      Revolving Credit Facility  2002 through 2006
   30




---



##### Table of Contents



Revolving Credit Facility  Second Amended Credit Agreement  March 29, 2007
   31




---



##### Table of Contents



Other Term Loan
  Financing Activities  Discontinued Operations
  Investing Activities  Continuing Operations
  2008
    
    
    2007
    
    
    2006Continuing Operations:Aircraft
    
    $
    0.0
    
    
    $
    0.0
    
    
    $
    0.0Aircraft improvements, engines and inspections
    
    
    4.2-4.5
    
    
    
    4.9
    
    
    
    8.1Rickenbacker Facility, technology and other
    
    
    0.3-0.5
    
    
    
    0.2
    
    
    
    0.1Total continuing operations
    
    
    4.5-5.0
    
    
    
    5.1
    
    
    
    8.2Discontinued operations
    
    
    0.0
    
    
    
    0.0
    
    
    
    1.1Total
    
    $
    4.5-5.0
    
    
    $
    5.1
    
    
    $
    9.3
   32




---



##### Table of Contents



Investing Activities  Discontinued Operations
  Off-Balance Sheet Arrangements
  Seasonality and Variability in Quarterly Results
   Critical Accounting Policies and Estimates
   Allowance for Uncollectible Accounts Receivable
   33




---



##### Table of Contents



Major Aircraft Maintenance
   Property and Equipment
   Stock-Based Compensation
 Share-Based Payment
 Accounting for Stock-Based
Compensation
 34




---



##### Table of Contents



Self-Insurance Accruals
   Incentive Compensation Plans
  Income Taxes
   Accounting for Uncertainty
in Income Taxes
   35




---



##### Table of Contents



Impairment of Assets
  2007 Asset Impairment Charge
    2006 Asset Impairment Charge
  Recent Accounting Pronouncements
 Fair
Value Measurements Effective Date of FASB Statement No. 157
 36




---



##### Table of Contents



, Accounting for Planned Major Maintenance Activities
 Forward-looking statements
  
    
    the continued 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;
    
    AirNets ability to execute strategic initiatives to expand into new business lines
in connection with the failure of Express Services revenues to replace declining Bank
Services revenues;
    
    AirNets ability to successfully implement new pricing structures for its weekday
Bank Services customers;
    
    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;
    
    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;
 37




---



##### Table of Contents




    
    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
  
 ITEM 8  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 Report of Independent Registered Public Accounting Firm
 
    
 38




---



##### Table of Contents



AIRNET SYSTEMS, INC.
 CONSOLIDATED BALANCE SHEETS
 December 31,In thousands, except par value data
    
    2007
    
    
    2006ASSETSCurrent assets:Cash and cash equivalents
    
    $
    4,500
    
    
    $
    2,244Accounts receivable, less allowances
    
    
    18,681
    
    
    
    22,345Deposits and prepaids
    
    
    2,402
    
    
    
    2,463Assets related to discontinued operations
    
    
    
    
    
    
    1,465Assets held for sale
    
    
    
    
    
    
    280Total current assets
    
    
    25,583
    
    
    
    28,797Net property and equipment
    
    
    24,731
    
    
    
    27,690Deposits and other assets
    
    
    60
    
    
    
    60Total assets
    
    $
    50,374
    
    
    $
    56,547LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued expenses
    
    $
    8,056
    
    
    $
    8,876Salaries and related liabilities
    
    
    4,036
    
    
    
    4,716Current portion of notes payable
    
    
    
    
    
    
    1,944Taxes payable
    
    
    478
    
    
    
    935Other liabilities related to discontinued operations
    
    
    
    
    
    
    50Total current liabilities
    
    
    12,570
    
    
    
    16,521Notes payable, less current portion
    
    
    
    
    
    
    6,011Shareholders 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, 2007 and December 31, 2006, respectively
    
    
    128
    
    
    
    128Additional paid-in-capital
    
    
    77,035
    
    
    
    76,906Retained deficit
    
    
    (16,339
    )
    
    
    (19,746
    )Accumulated other comprehensive income (loss)
    
    
    46
    
    
    
    (13
    )Treasury shares, 2,587and 2,598 common shares held at cost at
December 31, 2007 and December 31, 2006, respectively
    
    
    (23,066
    )
    
    
    (23,260
    )Total shareholders equity
    
    
    37,804
    
    
    
    34,015Total liabilities and shareholders equity
    
    $
    50,374
    
    
    $
    56,547
  39




---



##### Table of Contents



AIRNET SYSTEMS, INC.
 CONSOLIDATED STATEMENTS OF OPERATIONS
 Year Ended December 31,In thousands, except per share data
    
    2007
    
    
    2006NET REVENUES, NET OF EXCISE TAXAir Transportation, net of excise tax of $3,008 and $3,729 for the
years ended December 31, 2007 and 2006, respectively:Bank Services
    
    $
    99,853
    
    
    $
    112,034Express Services
    
    
    58,163
    
    
    
    59,187Aviation Services
    
    
    3,013
    
    
    
    1,586Total net revenues
    
    
    161,029
    
    
    
    172,807COSTS AND EXPENSESAircraft fuel
    
    
    25,473
    
    
    
    27,909Aircraft maintenance
    
    
    23,136
    
    
    
    17,998Operating wages and benefits
    
    
    19,127
    
    
    
    19,071Contracted air costs
    
    
    16,041
    
    
    
    16,550Ground courier
    
    
    32,841
    
    
    
    35,248Depreciation
    
    
    4,685
    
    
    
    9,700Insurance, rent and landing fees
    
    
    8,409
    
    
    
    8,639Travel, training and other operating
    
    
    6,579
    
    
    
    5,468Selling, general and administrative
    
    
    17,654
    
    
    
    17,939Net gain on disposition of assets
    
    
    (890
    )
    
    
    (140
    )Impairment of assets
    
    
    2,216
    
    
    
    24,560Total costs and expenses
    
    
    155,271
    
    
    
    182,942Income (loss) from continuing operations before interest and income taxes
    
    
    5,758
    
    
    
    (10,135
    )Interest expense
    
    
    251
    
    
    
    1,532Income (loss) from continuing operations before income taxes
    
    
    5,507
    
    
    
    (11,667
    )Provision for income taxes
    
    
    2,100
    
    
    
    1,654Income (loss) from continuing operations
    
    
    3,407
    
    
    
    (13,321
    )Income from discontinued operations
(including 2006 gain on sale of $610, net of tax)
    
    
    
    
    
    
    29Net income (loss)
    
    $
    3,407
    
    
    $
    (13,292
    )Income (loss) per common share  basic and diluted:Continuing operations
    
    $
    0.33
    
    
    $
    (1.31
    )Discontinued operations
    
    
    
    
    
    
    Net income (loss) per common share  basic and diluted
    
    $
    0.33
    
    
    $
    (1.31
    )
  40




---



##### Table of Contents



AIRNET SYSTEMS, INC.
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 Year Ended December 31,In thousands
    
    2007
    
    
    2006Operating activities:Net income (loss) from continuing operations
    
    
    3,407
    
    
    $
    (13,321
    )Adjustments to reconcile net income (loss) from continuing operations
to net cash provided by operating activities:Depreciation
    
    
    4,685
    
    
    
    9,700Impairment of assets
    
    
    2,216
    
    
    
    24,560Gain on disposition of assets
    
    
    (890
    )
    
    
    (140
    )Deferred income taxes
    
    
    
    
    
    
    (5,311
    )Engine core writeoffs charged to maintenance expense
    
    
    348
    
    
    
    164Stock-based compensation expense
    
    
    160
    
    
    
    246Other, net
    
    
    280
    
    
    
    (140
    )Cash provided by (used in) operating assets and liabilities:Accounts receivable
    
    
    3,664
    
    
    
    (1,242
    )Taxes receivable or payable
    
    
    (457
    )
    
    
    2,721Deposits and prepaids
    
    
    61
    
    
    
    (125
    )Accounts payable and accrued expenses
    
    
    (820
    )
    
    
    (1,161
    )Salaries and related liabilities
    
    
    (680
    )
    
    
    (3
    )Other, net
    
    
    59
    
    
    
    (124
    )Net cash provided by continuing operations
    
    
    12,033
    
    
    
    15,824Net cash provided by discontinued operations
    
    
    415
    
    
    
    3,038Net cash provided by operating activities
    
    
    12,448
    
    
    
    18,862Investing activities:Purchases of property and equipment
    
    
    (5,143
    )
    
    
    (8,084
    )Proceeds from sales of property and equipment
    
    
    1,743
    
    
    
    155Net cash used in continuing operations
    
    
    (3,400
    )
    
    
    (7,929
    )Net cash provided by discontinued operations
    
    
    1,000
    
    
    
    37,103Net cash provided by (used in) investing activities
    
    
    (2,400
    )
    
    
    29,174Financing activities:Proceeds from incentive stock plan programs
    
    
    163
    
    
    
    340Net borrowings (repayments) of revolving credit facilities
    
    
    (7,955
    )
    
    
    (16,500
    )Repayments of term loans
    
    
    
    
    
    
    (1,784
    )Other  net
    
    
    
    
    
    
    342Net cash used in continuing operations
    
    
    (7,792
    )
    
    
    (17,602
    )Net cash used in discontinued operations
    
    
    
    
    
    
    (29,780
    )Net cash used in financing activities
    
    
    (7,792
    )
    
    
    (47,382
    )Net increase in cash
    
    
    2,256
    
    
    
    654Cash and cash equivalents at beginning of year
    
    
    2,244
    
    
    
    1,590Cash and cash equivalents at end of year
    
    $
    4,500
    
    
    $
    2,244
  41




---



##### 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
    
    
    Income (Loss)
    
    
    Shares
    
    
    TotalBalance 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
    )
    
    $
    34,015Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,407
    
    
    
    
    
    
    
    
    
    
    
    3,407Foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    59
    
    
    
    
    
    
    
    59Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,466Issuance of treasury shares -
Associate Stock Purchase Program
    
    
    
    
    
    
    
    
    
    
    (171
    )
    
    
    
    
    
    
    
    
    
    
    194
    
    
    
    23Stock option vesting
    
    
    
    
    
    
    
    
    
    
    206
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    206Stock warrants vesting
    
    
    
    
    
    
    
    
    
    
    94
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    94Balance December 31, 2007
    
    
    12,763
    
    
    $
    128
    
    
    $
    77,035
    
    
    $
    (16,339
    )
    
    $
    46
    
    
    $
    (23,066
    )
    
    $
    37,804
  42




---



##### 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
   43




---



##### Table of Contents



2007
    
    
    2006Flight equipment
    
    $
    20,612,000
    
    
    $
    21,574,000Other property and equipment
    
    
    11,097,000
    
    
    
    10,923,00031,709,000
    
    
    
    32,497,000Less accumulated depreciation
    
    
    6,978,000
    
    
    
    4,807,000Net property and equipment
    
    $
    24,731,000
    
    
    $
    27,690,000
 Accounting for the Impairment or Disposal of Long-Lived
Assets
 Self-Insurance Accruals
  Incentive Compensation Plans
  Income Taxes
 Accounting
for Income Taxes
 Accounting for Uncertainty
in Income Taxes
  44




---



##### Table of Contents



Financial Instruments
  Stock-Based Compensation
 Share-Based Payment
    Recent Accounting Pronouncements
 Fair
Value Measurements Effective Date of FASB Statement No. 157
 , Accounting for Planned Major
Maintenance Activities
 45




---



##### Table of Contents



Supplemental Cash Flow Data
  2.
    
    Impairment of Property and Equipment
  2007 Asset Impairment Charge
    2006 Asset Impairment Charge
  46




---



##### Table of Contents



3.
    
    Major Bank Services Customers
    4.
    
    Discontinued Operations
    5.
    
    Notes Payable
  2007
    
    
    2006Term notes
    
    $
    
    
    
    $
    7,955,000Revolving credit facility
    
    
    
    
    
    
    
    
    
    
    7,955,000Current portion of notes payable
    
    
    
    
    
    
    1,944,000Long-term portion of notes payable
    
    $
    
    
    
    $
    6,011,000
 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 Loan
  Term Loans  Discontinued Operations
   2008
    
    $
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    Thereafter
    
    
    $
    
 6. Incentive Stock Plans
  49




---



##### Table of Contents



2007
    
    2006Risk free interest rate
    
    
    4.65
    %
    
    
    4.91
    %Volatility factor of expected market price
of AirNets common shares
    
    
    53.6
    %
    
    
    50.0
    %Weighted average expected life
of stock options (years)
    
    
    4.68
    
    
    
    5.49
   2007
    
    2006Weighted
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    AverageCommon
    
    Exercise
    
    Common
    
    ExerciseShares
    
    Price
    
    Shares
    
    PriceOutstanding at beginning of
period
    
    
    828
    
    
    $
    6.43
    
    
    
    886
    
    
    $
    7.71Granted
    
    
    56
    
    
    
    2.63
    
    
    
    150
    
    
    
    2.95Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cancelled
    
    
    (314
    )
    
    
    8.62
    
    
    
    (208
    )
    
    
    9.35Outstanding at end of period
    
    
    570
    
    
    
    4.86
    
    
    
    828
    
    
    
    6.43Options exercisable at end of
period
    
    
    499
    
    
    $
    5.08
    
    
    
    676
    
    
    $
    7.07
  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
    
    
    440
    
    
    
    6.7
    
    
    $
    3.58
    
    
    
    369
    
    
    $
    3.64$5.01-$10.00
    
    
    115
    
    
    
    2.0
    
    
    
    8.12
    
    
    
    115
    
    
    
    8.12$10.01-$15.00
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    

    $15.01-$20.00
    
    
    14
    
    
    
    0.6
    
    
    
    17.50
    
    
    
    14
    
    
    
    17.50$20.01-$25.00
    
    
    1
    
    
    
    0.1
    
    
    
    22.00
    
    
    
    1
    
    
    
    22.00570
    
    
    
    5.6
    
    
    $
    4.86
    
    
    
    499
    
    
    $
    5.08
  7. Lease Obligations
    51




---



##### Table of Contents



8. Retirement Plan
  9. Aircraft Dispositions
    10. Income Taxes
  2007
    
    
    2006Current:Federal
    
    $
    1,790,000
    
    
    $
    5,865,000State and local
    
    
    310,000
    
    
    
    625,0002,100,000
    
    
    
    6,490,000Deferred:Federal
    
    
    
    
    
    
    (3,481,000
    )State and local
    
    
    
    
    
    
    (1,336,000
    )
    
    
    
    (4,817,000
    )$
    2,100,000
    
    
    $
    1,673,000
  2007
    
    
    2006Deferred tax asset:Alternative minimum tax credit
    
    $
    
    
    
    $
    763,000Net operating loss carry forward
    
    
    558,000
    
    
    
    783,000Property and equipment
    
    
    10,825,000
    
    
    
    10,625,000Workers compensation reserve
    
    
    102,000
    
    
    
    195,000Allowance for bad debt reserves
    
    
    166,000
    
    
    
    351,000Other
    
    
    564,000
    
    
    
    502,000Valuation allowance
    
    
    (11,698,000
    )
    
    
    (12,467,000
    )Total deferred tax assets
    
    $
    517,000
    
    
    $
    752,000Deferred tax liabilities:Prepaid expenses
    
    $
    443,000
    
    
    $
    618,000Other
    
    
    74,000
    
    
    
    134,000Total current deferred tax liabilities
    
    
    517,000
    
    
    
    752,000Net current deferred tax assets (liabilities)
    
    $
    0
    
    
    $
    0
 52




---



##### Table of Contents



2007
    
    
    
    
    
    2006Tax expense (benefit) at federal statutory
rate on pre-tax (loss) income
    
    $
    1,873,000
    
    
    
    34.0
    %
    
    $
    (3,950,000
    )
    
    
    33.9
    %State taxes, net of federal benefit
    
    
    268,000
    
    
    
    4.9
    
    
    
    (492,000
    )
    
    
    4.2Non-deductible permanent differences
    
    
    107,000
    
    
    
    1.9
    
    
    
    168,000
    
    
    
    (1.4
    )Change in valuation allowance
    
    
    (161,000
    )
    
    
    (2.9
    )
    
    
    6,167,000
    
    
    
    (52.8
    )Other
    
    
    13,000
    
    
    
    0.2
    
    
    
    (221,000
    )
    
    
    1.9Total taxes (benefit)
    
    
    2,100,000
    
    
    
    38.1
    %
    
    $
    1,672,000
    
    
    
    14.2
    %Less  portion attributable to
discontinued operations
    
    
    0
    
    
    
    
    
    
    
    18,000Net attributable to continuing operations
    
    $
    2,100,000
    
    
    
    
    
    
    $
    1,654,000
    53




---



##### Table of Contents



11. Net Income (Loss) Per Common Share
  2007
    
    
    2006Numerator:Income (loss) from continuing operations
    
    $
    3,407,000
    
    
    
    ($13,321,000
    )Income (loss) from discontinued operations, net of tax
    
    
    
    
    
    
    29,000Net income (loss)
    
    $
    3,407,000
    
    
    
    ($13,292,000
    )Denominator:Basic  weighted average common shares outstanding
    
    
    10,171,000
    
    
    
    10,158,000DilutedStock options  employees, officers and directors
    
    
    
    
    
    
    Adjusted weighted average common shares outstanding
    
    
    10,171,000
    
    
    
    10,158,000Net income (loss) per common share  basic and diluted
    
    $
    0.33
    
    
    
    ($1.31
    )
  12. Litigation and Contingencies
  13. Subsequent Events (Unaudited)
   54




---



##### Table of Contents



Selected Quarterly Financial Information
  
 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
  
 ITEM 9A(T). 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
rules and forms of the Securities and Exchange Commission (the SEC); 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.
 Managements Annual Report on Internal Control Over Financial Reporting
  a)
    
    Pertain to the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets of AirNet and its consolidated
subsidiaries;b)
    
    Provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with United States generally accepted
accounting principles, and that receipts and expenditures of AirNet and its consolidated
subsidiaries are being made only in accordance with authorizations of management and
directors of AirNet; andc)
    
    Provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the assets of AirNet and its consolidated subsidiaries
that could have a material effect on the financial statements.
  55




---



##### Table of Contents



Changes in Internal Control over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION
 Engagement of MergeGlobal Inc.
   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.
   56




---



##### Table of Contents




    
    30% of Mr. Parkers incentive compensation potential was 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 was 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 was based upon the attainment of
the personal goals established for Mr. Parker by the Board of Directors.
 The Board of Directors established the following personal goals for Mr. Parker for the 2007 fiscal
year:
    
    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.
  57




---



##### Table of Contents



Adoption of 2008 Incentive Compensation Plan
  
    
    Operate in all areas of AirNets business in an absolutely safe, highly professional,
dependable, efficient and customer-focused manner
    
    Operate as one team and one company focused on results
    
    Meet company financial objectives, as measured by budgeted pre-tax income
    
    Grow Express Services (as measured by Express Services contribution margins) and
Express Services markets in dedicated retail charter cargo and wholesale / ACMI dedicated charters
    
    Modify AirNets air transportation network flying relative to customer demand
efficiently
    
    Improve AirNets overall contribution margins and establish AirNet as the express air
carrier of choice for highly controlled and time sensitive shipments
    
    Reduce selling, general and administrative costs
   58




---



##### Table of Contents




    
    30% of Mr. Parkers incentive compensation potential will be based upon attaining at
least 90% 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 80% of the targeted Express Services 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.
  
    
    refine AirNets operating strategy;
    
    developing AirNets management into an integrated team working to achieve specific
objectives; and
    
    development of a chief executive officer succession plan
   59




---



##### Table of Contents



PART III
 
 ITEM 10  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
  Corporate Governance Documents
    
 ITEM 11  EXECUTIVE COMPENSATION
  60




---



##### Table of Contents



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
  
 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:
 
  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, 2007:Deducted
from asset
accounts; Allowance
for doubtful
accounts
    
    $
    900,000
    
    
    $
    94,705
    
    
    $
    
    
    
    $
    569,705
    
    
    $
    425,000Year ended December
31, 2006:Deducted
from asset
accounts;Allowance
for doubtful
accounts
    
    $
    724,729
    
    
    $
    347,529
    
    
    $
    227,716
    
    
    $
    399,974
    
    
    $
    900,000
 
 (1)
    
    Uncollectible accounts written off, net of recoveries  61




---



##### Table of Contents



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:
 Exhibit No.
    
    Description
    
    Location2.1
    
    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)
 62




---



##### Table of Contents



Exhibit No.
    
    Description
    
    Location3.6
    
    Certificate Regarding Adoption of
Amendments to Sections 1.04(A) and 1.04(B)
of AirNet Systems, Inc.s Code of
Regulations by the Shareholders on June 6,
2007
    
    Incorporated herein
by reference from
Exhibit 3.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated and filed on
June 11, 2007 (File
No. 001-13025)3.7
    
    Code of Regulations of AirNet Systems,
Inc. (reflecting all amendments through
June 6, 2007) [for SEC reporting
compliance purposes only]
    
    Incorporated herein
by reference from
Exhibit 3.2 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended June
30, 2007 (File No.
001-13025)4.1
    
    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 [NOTE:
Has been amended and restated]
    
    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-K
 63




---



##### Table of Contents



Exhibit No.
    
    Description
    
    Location4.10
    
    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-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-K
 64




---



##### Table of Contents



Exhibit No.
    
    Description
    
    Location4.18
    
    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-K4.21
    
    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-K
 65




---



##### Table of Contents



Exhibit No.
    
    Description
    
    Location4.25
    
    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-Q4.28
    
    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-Q
 66




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.34
    
    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-Q4.37
    
    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-Q
 67




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.43
    
    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-Q4.46
    
    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
    
    Incorporated herein
by reference from
Exhibit 4.50 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2006 (File No.
001-13025) (the
2006 Form 10-K)4.51
    
    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
    
    Incorporated herein
by reference from
Exhibit 4.51 to
AirNet Systems,
Inc.s 2006 Form
10-K
 68




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.52
    
    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-K10.7*
    
    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
    
    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)10.10
    
    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-K10.11
    
    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-K
 69




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.12
    
    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-K10.13
    
    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-K10.14
    
    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-K10.15
    
    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-K10.16
    
    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 Current
Report on Form 8-K
dated and filed on
December 21, 2004
(File No.
001-13025)10.17
    
    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-K10.18*
    
    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)10.19*
    
    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)10.20*
    
    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
    
    Incorporated herein
by reference from
Exhibit 10.25 to
AirNet Systems,
Inc.s 2006 Form
10-K10.21*
    
    Summary of Compensation for Directors of
AirNet Systems, Inc.
    
    Filed herewith10.22*
    
    Employment Agreement, made as of May 3,
2005, between AirNet Systems, Inc. and
Gary W. Qualmann [NOTE: Terminated on
October 3, 2007]
    
    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)
 70




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.23*
    
    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-K10.24*
    
    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-K10.25*
    
    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
    
    Incorporated herein
by reference from
Exhibit 10.31 to
AirNet Systems,
Inc.s 2006 Form
10-K10.26*
    
    Separation Agreement and General Release,
entered into as of October 3, 2007,
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
October 9, 2007
(File No.
001-13025) (the
October 9, 2007
Form 8-K)10.27*
    
    Letter Agreement, dated as of October 8,
2007, between AirNet Systems, Inc. and Ray
L. Druseikis
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s October 9,
2007 Form 8-K10.28*
    
    Summary of 2007 Incentive Compensation Plan
    
    Filed herewith10.29*
    
    Summary of 2008 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
  71




---



##### Table of Contents



SIGNATURES
  AIRNET SYSTEMS, INC.Dated: March 31, 2008
    
    By:
    
    /s/ Bruce D. ParkerBruce 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 31, 2008/s/ Ray L. Druseikis

Ray L. Druseikis
    
    Vice President of Finance and
Controller; Interim Chief
Financial Officer, Treasurer
and Secretary (Principal
Financial Officer and
Principal Accounting Officer)
    
    March 31, 2008*/s/ James M. Chadwick

James M. Chadwick
    
    Director
    
    March 31, 2008*/s/ Gerald Hellerman

Gerald Hellerman
    
    Director
    
    March 31, 2008*/s/ Thomas J. Kiernan

Thomas J. Kiernan
    
    Director
    
    March 31, 2008*/s/ Robert H. Milbourne

Robert H. Milbourne
    
    Director
    
    March 31, 2008*/s/ James E. Riddle

James E. Riddle
    
    Director
    
    March 31, 2008
  *By
    
    /s/ Bruce D. Parker

Bruce D. Parker, Attorney-in-Fact
 72




---



##### Table of Contents



INDEX TO EXHIBITS
 ExhibitNo.
    
    Description
    
    Location2.1
    
    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
    
    Certificate Regarding Adoption of
Amendments to Sections 1.04(A) and 1.04(B)
of AirNet Systems, Inc.s Code of
Regulations by the Shareholders on June 6,
2007
    
    Incorporated herein
by reference from
Exhibit 3.1 to
AirNet Systems,
Inc.s Current
Report on Form 8-K
dated and filed on
June 11, 2007 (File
No. 001-13025)3.7
    
    Code of Regulations of AirNet Systems,
Inc. (reflecting all amendments through
June 6, 2007) [for SEC reporting
compliance purposes only]
    
    Incorporated herein
by reference from
Exhibit 3.2 to
AirNet Systems,
Inc.s Quarterly
Report on Form 10-Q
for the quarterly
period ended June
30, 2007 (File No.
001-13025)4.1
    
    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 [NOTE:
Has been amended and restated]
    
    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)
 73




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location4.2
    
    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
 74




---



##### 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
 75




---



##### 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




---



##### 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




---



##### 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
 78




---



##### 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
    
    Incorporated herein
by reference from
Exhibit 4.50 to
AirNet Systems,
Inc.s Annual
Report on Form 10-K
for the fiscal year
ended December 31,
2006 (File No.
001-13025) (the
2006 Form 10-K)4.51
    
    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
    
    Incorporated herein
by reference from
Exhibit 4.51 to
AirNet Systems,
Inc.s 2006 Form
10-K4.52
    
    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)
 79




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.3
    
    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-K10.7*
    
    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
    
    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)10.10
    
    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-K10.11
    
    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-K10.12
    
    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-K10.13
    
    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-K10.14
    
    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-K
 80




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.15
    
    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-K10.16
    
    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 Current
Report on Form 8-K
dated and filed on
December 21, 2004
(File No.
001-13025)10.17
    
    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-K10.18*
    
    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)10.19*
    
    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)10.20*
    
    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
    
    Incorporated herein
by reference from
Exhibit 10.25 to
AirNet Systems,
Inc.s 2006 Form
10-K10.21*
    
    Summary of Compensation for Directors of
AirNet Systems, Inc.
    
    Filed herewith10.22*
    
    Employment Agreement, made as of May 3,
2005, between AirNet Systems, Inc. and
Gary W. Qualmann [NOTE: Terminated on
October 3, 2007]
    
    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)10.23*
    
    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-K10.24*
    
    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-K10.25*
    
    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
    
    Incorporated herein
by reference from
Exhibit 10.31 to
AirNet Systems,
Inc.s 2006 Form
10-K
 81




---



##### Table of Contents



ExhibitNo.
    
    Description
    
    Location10.26*
    
    Separation Agreement and General Release,
entered into as of October 3, 2007,
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
October 9, 2007
(File No.
001-13025) (the
October 9, 2007
Form 8-K)10.27*
    
    Letter Agreement, dated as of October 8,
2007, between AirNet Systems, Inc. and Ray
L. Druseikis
    
    Incorporated herein
by reference from
Exhibit 10.2 to
AirNet Systems,
Inc.s October 9,
2007 Form 8-K10.28*
    
    Summary of 2007 Incentive Compensation Plan
    
    Filed herewith10.29*
    
    Summary of 2008 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