Document:

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                                                                    EXHIBIT 10.4

                              EMPLOYMENT AGREEMENT

      THIS AGREEMENT made as of May 22, 2002 by and between MERCURY AIR GROUP,
INC., a Delaware corporation having its principal offices at 5456 McConnell
Avenue, Los Angeles, California 90066 (hereinafter referred to as "Mercury"),
and Mr. Robert Schlax, residing at 15 Windham Lane, Laguna Miguel, California
92677 (hereinafter referred to as "Schlax").

                              W I T N E S S E T H:

      WHEREAS, Schlax has been employed as Vice President of Finance of Mercury
since February 2002 and Treasurer since March 2002; and

      WHEREAS, Mercury's Board of Directors (the "Board of Directors") would
like to continue Schlax's role as Vice President of Finance and Treasurer of
Mercury on the terms and conditions set forth in this Agreement; and

      WHEREAS, Schlax wishes to accept this position on the terms and conditions
set forth in this Agreement.

      NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, the parties agree as follows:

      First:       Employment

      (a) Employment. Mercury hereby confirms and agrees that Schlax will be
appointed by the Board of Directors of Mercury to continue serving as the Vice
President of Finance and Treasurer of Mercury. In his capacity as Vice President
of Finance and Treasurer of Mercury, Schlax shall continue to report directly to
Mercury's Chief Executive Officer.

      (b) Schlax's Acceptance. Schlax hereby accepts his appointments as Vice
President of Finance and Treasurer of Mercury.

      Second:      Term

      Subject to the provisions governing termination as hereinafter provided,
the term of this Agreement shall begin on the date hereof and shall terminate
three years thereafter. If Schlax is then employed by Mercury, on each
successive anniversary date, the term of this Agreement shall be automatically
extended for one additional year such that the remaining term of the Agreement
shall then be one (1) year; provided, however, that upon written notice given by
either party at least thirty (30) days prior to the next automatic extension,
the automatic extension right may be terminated.

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      Third:       Compensation

      (a) Base Compensation. For all services rendered by Schlax under this
Agreement, Mercury shall pay Schlax a salary of $170,000 per year, payable in
semi-monthly installments in accordance with Mercury's standard payroll
practices. From time to time, the salary payable to Schlax may be adjusted at
the sole discretion of the Compensation Committee of the Board of Directors (the
"Compensation Committee"). Schlax's annual salary, as from time to time adjusted
by the Compensation Committee, is hereinafter referred to as "Base
Compensation".

      (b) Bonus Plans. The Board of Directors may, at its discretion, establish
a bonus plan for Schlax.

      Fourth:      Extent of Services

      Schlax shall devote his entire time, attention and energies to the
business of Mercury (and its various subsidiaries) and shall not during the term
of this Agreement be engaged in any other business activity whether or not such
business activity is pursued for gain, profit or other pecuniary advantage; but
this shall not be construed as preventing Schlax from investing his assets in
companies or other entities in such form or manner as will not require any
services on the part of Schlax in the operation of the affairs of such companies
or entities in which such investments are made, and, with respect to companies
or other entities which are competitors of Mercury, where Schlax's investment
does not represent in excess of five percent (5%) of the outstanding equity of
such company or entity.

      Fifth:       Working Facilities

      Schlax shall be furnished with a private office and other facilities and
services reasonably suitable to his position and adequate for the performance of
his duties. Schlax shall be employed at the principal offices of Mercury located
in Los Angeles, California and shall travel to the extent necessary to fulfill
his duties in his discretion.

      Sixth:       Disclosure of Information

      (a) Generally. The parties acknowledge that Mercury and its affiliates
(individually and collectively, the "Companies"), have developed and intend to
continue the development of and to formulate, acquire and use commercially
valuable technical and non-technical information, design and specification
documents, concepts, technology, know-how, improvements, proposals, patent
applications, techniques, marketing plans, strategies, forecasts, inventions
(not limited by the definition of an invention contained in the United States
Patent Laws), Trade Secrets (as defined in Sec. 3426.1(d) of the Uniform Trade
Secrets Act) and processes which are considered proprietary by the Companies,
particularly including, without limitation, customer and supplier lists, books
and records, computer programs, pricing information and business plans
(collectively, the "Proprietary Information"). It is necessary for the Companies
to protect the Proprietary Information by patents or copyrights or by holding it
secret and confidential.

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      (b) Access to Proprietary Information. The parties acknowledge that Schlax
has access to the Proprietary Information and that the disclosure or misuse of
such Proprietary Information could irreparably damage the Companies and/or their
respective clients or customers.

      (c) Nondisclosure to others. Except as directed by Mercury in writing or
verbally, Schlax shall not at any time during or after the Term disclose any
Proprietary Information to any person whatsoever, examine or make copies of any
reports or other documents, papers, memoranda or extracts for use other than in
connection with his duties with Mercury or utilize for his own benefit or for
the benefit of any other party any such Proprietary Information and will use
reasonable diligence to maintain the confidential, secret or proprietary
character of all Proprietary Information.

      (d) Survivability. Schlax acknowledges that his obligations hereunder
shall continue beyond the Term with respect to any Proprietary Information (as
defined in Article Sixth, paragraph (a) hereof) which came into his possession
during the Term.

      Seventh:     Expenses

      Schlax is authorized to incur reasonable expenses for promoting the
business of Mercury, including expenses for entertainment, travel and similar
items but only in accordance with the policies of the Board of Directors of
Mercury's Chief Executive Officer, as from time to time adopted. Mercury will
reimburse Schlax for all such reasonable expenses upon the presentation by
Schlax, from time to time, of an itemized account and documentation of such
expenditures in sufficient detail to allow Mercury to claim an income tax
deduction for each paid item, if such item is deductible.

      Eighth:      Fringe Benefits

      (a) Participating in General Plans. Schlax shall have such employee
benefits (including medical insurance, life insurance, 401(k) and disability
insurance plans) as Mercury shall from time-to-time establish, promulgate or
keep in effect for the benefit of its management level employees. Such benefits
will include company paid medical insurance for Schlax and his family under
Mercury's medical insurance plans. Schlax shall be required to comply with, and
be entitled to benefits only in accordance with, the terms and conditions of
such plans. Nothing contained in this paragraph (a) of Article Eighth, however,
shall be construed to require Mercury to establish any life, disability or
medical insurance plans not in existence on the date hereof, to continue any
plans in existence on the date hereof, to prevent Mercury from modifying and/or
terminating any of the plans in existence on the date hereof or otherwise
require Mercury to take special steps to insure the eligibility of Schlax or his
dependents under the provisions of such plans, and no such act or omission shall
be deemed to affect this Agreement or to require modification of the
compensation, additional benefit or other provisions contained herein.

      (b) Stock Options. Schlax shall be entitled to the grant of stock options
          as from time to time determined in the sole discretion of the Board of
          Directors.

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      (c) 2002 Management Stock Purchase Plan.

          (i) By virtue of his eligibility to participate in the 2002 Management
      Stock Purchase Plan, Schlax may purchase from CFK Partners, an Illinois
      general partnership, up to 25,000 unregistered shares of the common stock
      of Mercury, $0.01 par value, at a price of $7.50 per share (the "Purchase
      Price"), such purchase to be funded by Mercury.

          (ii) In the event Schlax voluntarily leaves the full-time employment
      of Mercury or any of its subsidiaries or related companies for any reason
      whatsoever without the prior consent of Mercury, or in the event Schlax's
      employment is terminated with or without "cause", as defined in Article 9
      hereof (except pursuant to Article 11(a) of the Employment Agreement or as
      set forth below), or in the event Schlax dies or becomes disabled
      (hereinafter the "Date of Discharge"), Schlax or his estate shall be
      obligated to repay the sums provided by Mercury hereunder, provided,
      however, that, in connection with Schlax's employment with Mercury,
      Schlax's obligations hereunder shall be forgiven by the percentage equal
      to the product of (i) 10% and (ii) the number of years from the date
      hereof to the Date of Discharge, with the number of years calculated on a
      March 1st fiscal year (so that if, for example, the Date of Discharge is
      April 1, 2004, the number of years calculated hereunder shall be 2).
      Schlax shall receive 10% of the original amount of stock purchased on the
      anniversary date of the Employment Agreement's execution and will be fully
      vested and eligible to vote those shares. Schlax shall have no obligation
      to repay Mercury if he remains employed by Mercury after March 1, 2012.
      Mercury shall be granted a secured interest as a creditor of Schlax in the
      event Schlax defaults in his obligation to Mercury as herein set forth and
      Mercury will designate an escrow to hold the shares underlying the
      remaining debt obligation. In the event Schlax terminates his employment
      pursuant to Article 11(a) of the Employment Agreement or is terminated by
      Mercury for any reason following an event set forth in Article 11(a) of
      his Employment Agreement, Schlax shall have no further obligation to repay
      Mercury all or any portion of the Purchase Price. While Schlax has any
      obligation to Mercury hereunder, Schlax shall be obligated to comply with
      directions of the Board of Directors of Mercury with respect to the voting
      of those shares held in escrow purchased by Schlax hereunder.

          (d) Vacation. Schlax shall be entitled each year to a vacation of four
      (4) weeks, during which time his compensation shall be paid in full.

      Ninth:       Mercury's Right to Terminate For Cause

      (a) Cause. Mercury may at any time during the term of this Agreement
discharge Schlax for "cause." The term "cause" is defined herein as Schlax's (i)
misappropriation of corporate funds, fraud, embezzlement or other illegal
conduct to the detriment of Mercury, (ii) negligence in the execution of his
material assigned duties or Schlax's voluntary abandonment of his job for any
reason other than disability; (iii) refusal or failure, after not less than 20
days written notice that such refusal or failure would constitute a default
hereunder, to carry out any reasonable and material direction from the Board of
Directors given to him in writing; (iv) conviction of a felony; (v) material
breach or violation of the terms of this Agreement, which breach or violation
shall not have been fully cured (as determined by the Board of Directors acting
in good faith) by Schlax within 20 days after receipt of written notice of the
same from the Board of Directors; (vi) Schlax's death or

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disability (except that, in the event of Schlax's disability, Mercury shall, at
Schlax's request, prior to discharge, grant Schlax a leave of absence of up to
six months or such longer period of time as may be required by law); or (vii)
Schlax's engagement in drug or alcohol abuse. Schlax shall be terminated only
following a finding of "cause" in a resolution adopted by majority vote of the
Board of Directors of Mercury.

      (b) No Rights Following Cause Termination. Following a termination of
Schlax's employment with Mercury "for cause" pursuant to paragraph (a) of this
Article Ninth: (i) all rights and liabilities of the parties hereto shall cease
and this Agreement shall be terminated (subject to the continuing obligations of
Schlax pursuant to Article Sixth and Twelfth hereof); and (ii) Schlax shall not
be entitled to receive any severance benefits, salary, other benefits or
compensation of any kind (except for health insurance continuation as required
by COBRA, salary accrued through the date of termination and accrued vacation
pay as required by law) either as consideration for his employment or in
connection with the termination of his employment. In the event that Schlax
asserts that his voluntary termination was actually a constructive termination,
Mercury shall be entitled to assert as "cause" for such termination any grounds
present at the time of such termination which the Board of Directors could have
asserted as "cause" if called upon to terminate Schlax.

      Tenth:       Termination Without Cause

      (a) Rights Following Termination Without Cause. Should Schlax be
discharged by Mercury at any time during the term of this Agreement except as
provided in Article Ninth, Mercury hereby agrees to pay Schlax within thirty
(30) days from such discharge the lesser of one year's Base Compensation or the
Base Compensation that would otherwise be paid to him over the remaining term of
this Agreement, with a minimum of six (6) months base compensation.

      (b) No Additional Rights. Except as set forth above in paragraph (a) of
this Article Tenth following a termination of Schlax's employment by Mercury
other that pursuant to Article Ninth above and Article Eleventh below: (i) all
rights and liabilities of the parties hereto shall cease and this Agreement
shall be terminated (subject to the continuing obligations of Schlax pursuant to
Articles Sixth and Twelfth); and (ii) Schlax shall not be entitled to receive
any severance benefits, salary, other benefits or compensation of any kind
(except for health insurance continuation as required by COBRA and accrued
vacation pay as required by law) either as consideration for his employment or
in connection with the termination of his employment.

      Eleventh:    Right to Voluntary Termination by Schlax

      (a) Conditions for Termination by Schlax. In the event that:

          (i) Any "person" other than CFK Partners or an affiliate of CFK
      Partners is or becomes a "beneficial" owner, "directly or indirectly", of
      stock of Mercury representing 50% or more of the total voting power of
      Mercury's then outstanding stock, without the written consent of the Board
      of Directors of Mercury; or

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          (ii) Mercury is acquired by another entity through the purchase of
      substantially all of its assets, the purchase of all of its outstanding
      voting securities or a combination thereof, without the consent of the
      Board of Directors of Mercury; or

          (iii) Mercury is merged with another entity, consolidated with another
      entity or reorganized in a manner in which any "person" other than CFK
      Partners or an affiliate of CFK Partners is or becomes a "beneficial"
      owner, "directly or indirectly", of stock of the surviving entity
      representing 50% or more of the total voting power of the surviving
      entity's then outstanding stock, without the consent of the Board of
      Directors of Mercury; or

          (iv) During any period of one, two or three consecutive years,
      individuals who at the beginning of any such period constitute the
      directors of Mercury cease for any reason to constitute at least a
      majority thereof unless the election, or the nomination or election by
      Mercury's stockholders, of each new director of Mercury was approved by a
      vote of at least two-thirds of such directors of Mercury then still in
      office who were directors of Mercury at the beginning of any such period;

      then, if following any of the events set forth in clauses (i), (ii),
(iii) or (iv), Schlax's duties are substantially altered or Schlax is demoted
for cause, Schlax shall have the right and option to voluntarily terminate this
Agreement upon written notice to Mercury. All terms used in quotations in
clauses (i) and (iii) shall have the meanings assigned to such terms in Section
13 of the Securities Exchange Act of 1934 and the rules, regulations, releases
and no-action letters of the Securities and Exchange Commission promulgated
thereunder or interpreting any of the same. For purposes of clauses (i) and
(iii), the term "affiliate" shall have the meaning assigned to such term in Rule
144 promulgated by the Securities and Exchange Commission under the Securities
Act of 1933, as amended, and the releases and no-action letters interpreting the
same.

      (b) Rights Following Voluntary Termination After a Change of Control.
Following any voluntary termination of employment by Schlax pursuant to
paragraph (a) of this Article Eleventh, Schlax shall be entitled to be paid by
Mercury within thirty (30) days of such termination by Schlax, the lesser of one
year's Base Compensation or the entire balance of his Base Compensation
remaining to be paid to Schlax over the full remaining term of this Agreement.

      (c) No Additional Rights. Except as set forth above in paragraph (b) of
this Article Eleventh, following a voluntary termination of Schlax's employment
with Mercury pursuant to paragraph (a) of this Article Eleventh: (i) all rights
and liabilities of the parties hereto shall cease and this Agreement shall be
terminated (subject to the continuing obligations of Schlax pursuant to Articles
Sixth and Twelfth); and (ii) Schlax shall not be entitled to receive any
severance benefits, salary, other benefits or compensation of any kind (except
for health insurance continuation as required by COBRA and accrued vacation pay
as required by law) either as consideration for his employment or in connection
with the termination of his employment.

      Twelfth:     Restrictive Covenant

      Schlax covenants and agrees that during the period commencing with the
date hereof and ending six (6) months from the date Schlax's employment with
Mercury is terminated for "cause" or by reason of Schlax's voluntary termination
of employment from Mercury (the "Non-Compete Period"), Schlax will not compete
or attempt to compete with or become associated with any business which competes
with the Companies' government contracts, cargo, commercial aviation, fuel
sales, fixed base operations, or any business activities of the Companies
existing on or developed subsequent to the date hereof. Schlax covenants and
agrees that he will not, without the prior written consent of Mercury during the
Non-Compete Period: (a) solicit any customer of the Companies; (b) solicit any
contracts which were either being solicited by, or which were under

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contract with, the Companies by performing or causing to be performed any work
which was either being solicited by, or which was under contract with, Mercury;
or (c) induce any sales, operating, technical or other personnel of the
Companies to leave the service, employ or business of the Companies. Schlax
agrees that he will not violate this Article Eleventh: (a) directly or
indirectly; (b) in any capacity, either individually or as a member of any firm;
(c) as an officer, director, stockholder, partner or Schlax of any business; or
(d) through or with any persons, relatives (either through blood or marriage),
firms, corporations or individuals controlled by or associated with him (each
and every such method of violation referred to in clauses (a) through (d) shall
hereinafter be referred to as an "indirect violation"). Schlax further agrees
that doing or causing to be done any of the actions prohibited in this Article
Eleventh by means of an indirect violation shall constitute a violation of this
Article Eleventh as though violated by Schlax, subject to all of the remedies to
Mercury provided for herein and as otherwise provided by law.

      Thirteenth:  Arbitration; Governing Law.

      Any controversy or claim arising out of, or relating to this Agreement or
the breach thereof, shall be settled by binding arbitration in the City of Los
Angeles pursuant to the laws of the State of California in accordance with the
rules then obtaining of the America Arbitration Association, and judgments upon
the award rendered my be entered in any court having jurisdiction thereof. This
Agreement shall be governed by and construed in accordance with the substantive
laws of the State of California. The arbitrators shall have the power in their
discretion to award attorneys' fees and other legal costs and expenses to the
prevailing party in connection with any arbitration.

      Fourteenth:  Notices

      Any notice required or permitted to be given under this Agreement shall be
sufficient if in writing and sent by certified mail to his residence, in the
case of Schlax, or to its principal office, in the case of Mercury.

      Fifteenth:   Waiver of Breach

      The waiver by Mercury of a breach of any provision of this Agreement by
Schlax shall not operate or be construed as a waiver of any subsequent breach by
Schlax.

      Sixteenth:   Assignment

      The rights and obligations of Mercury under this Agreement shall inure to
the benefit of and shall be binding upon the successors and assigns of Mercury.

      Seventeenth: Entire Agreement; Written Amendment

      This instrument contains the entire agreement of the parties with respect
to the subject matter hereof. This Agreement may only be amended, modified,
extended or discharged and the provisions of this Agreement may only be waived
by an agreement in writing signed by the party against whom enforcement of any
waiver, change, modification, extension or discharge is sought.

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      Eighteenth:  Equitable Relief; Partial Enforcement

      Mercury and Schlax have agreed that violation or breach of Articles Sixth
and Eleventh will result in irreparable injury to the Companies and shall
entitle the Companies to equitable relief in addition to any other remedies
provided at law. Mercury and Schlax have further agreed in the event that only a
portion of Articles Sixth or Eleventh shall be deemed enforceable or valid that
portion of such Articles as shall be enforceable or valid shall be enforced.
Mercury and Schlax have further agreed that the court making a determination of
the validity or enforceability of such Articles shall have the power and
authority to rewrite the restrictions contained in such Articles to include the
maximum portion of the restrictions included within such Articles as are
enforceable, valid and consistent with the intent of the parties as expressed in
such Articles.

      IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.

                                          MERCURY AIR GROUP, INC.

                                          By:  /s/ Joseph A. Czyzyk
                                             -----------------------------------
                                          Its: Chief Executive Officer

                                          /s/ Robert Schlax
                                          --------------------------------------
                                          Robert Schlax

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                                                                    EXHIBIT 10.5

                              EMPLOYMENT AGREEMENT

      THIS AGREEMENT made as of May 22, 2002 by and between MERCURY AIR GROUP,
INC., a Delaware corporation having its principal offices at 5456 McConnell
Avenue, Los Angeles, California 90066 (hereinafter referred to as "Mercury"),
and Mr. Steve Antonoff, residing at 119 South Helberta Avenue, #7, Redondo
Beach, California 90277 (hereinafter referred to as "Antonoff").

                              W I T N E S S E T H:

      WHEREAS, Antonoff has been employed as Vice President of Human Services of
Mercury; and

      WHEREAS, Mercury's Board of Directors (the "Board of Directors") would
like to continue Antonoff's role as Vice President of Human Resources of Mercury
on the terms and conditions set forth in this Agreement; and

      WHEREAS, Antonoff wishes to accept this position on the terms and
conditions set forth in this Agreement.

      NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, the parties agree as follows:

      First:       Employment

      (a) Employment. Mercury hereby confirms and agrees that Antonoff will be
appointed by the Board of Directors of Mercury to continue serving as an Vice
President of Human Resources of Mercury. In his capacity as Vice President of
Human Resources of Mercury, Antonoff shall continue to report directly to
Mercury's Chief Executive Officer.

      (b) Antonoff's Acceptance. Antonoff hereby accepts his appointments as
Vice President of Human Resources of Mercury.

      Second:      Term

      Subject to the provisions governing termination as hereinafter provided,
the term of this Agreement shall begin on the date hereof and shall terminate
three years thereafter. If Antonoff is then employed by Mercury, on each
successive anniversary date, the term of this Agreement shall be automatically
extended for one additional year such that the remaining term of the Agreement
shall then be one (1) year; provided, however, that upon written notice given by
either party at least thirty (30) days prior to the next automatic extension,
the automatic extension right may be terminated.

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      Third:       Compensation

      (a) Base Compensation. For all services rendered by Antonoff under this
Agreement, Mercury shall pay Antonoff a salary of $116,600 per year, payable in
semi-monthly installments in accordance with Mercury's standard payroll
practices. From time to time, the salary payable to Antonoff may be adjusted at
the sole discretion of the Compensation Committee of the Board of Directors (the
"Compensation Committee"). Antonoff's annual salary, as from time to time
adjusted by the Compensation Committee, is hereinafter referred to as "Base
Compensation".

      (b) Bonus Plans. The Board of Directors may, at its discretion, establish
a bonus plan for Antonoff.

      Fourth:      Extent of Services

      Antonoff shall devote his entire time, attention and energies to the
business of Mercury (and its various subsidiaries) and shall not during the term
of this Agreement be engaged in any other business activity whether or not such
business activity is pursued for gain, profit or other pecuniary advantage; but
this shall not be construed as preventing Antonoff from investing his assets in
companies or other entities in such form or manner as will not require any
services on the part of Antonoff in the operation of the affairs of such
companies or entities in which such investments are made, and, with respect to
companies or other entities which are competitors of Mercury, where Antonoff's
investment does not represent in excess of five percent (5%) of the outstanding
equity of such company or entity.

      Fifth:       Working Facilities

      Antonoff shall be furnished with a private office and other facilities and
services reasonably suitable to his position and adequate for the performance of
his duties. Antonoff shall be employed at the principal offices of Mercury
located in Los Angeles, California and shall travel to the extent necessary to
fulfill his duties in his discretion.

      Sixth:       Disclosure of Information

      (a) Generally. The parties acknowledge that Mercury and its affiliates
(individually and collectively, the "Companies"), have developed and intend to
continue the development of and to formulate, acquire and use commercially
valuable technical and non-technical information, design and specification
documents, concepts, technology, know-how, improvements, proposals, patent
applications, techniques, marketing plans, strategies, forecasts, inventions
(not limited by the definition of an invention contained in the United States
Patent Laws), Trade Secrets (as defined in Sec. 3426.1(d) of the Uniform Trade
Secrets Act) and processes which are considered proprietary by the Companies,
particularly including, without limitation, customer and supplier lists, books
and records, computer programs, pricing information and business plans
(collectively, the "Proprietary Information"). It is necessary for the Companies
to protect the Proprietary Information by patents or copyrights or by holding it
secret and confidential.

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      (b) Access to Proprietary Information. The parties acknowledge that
Antonoff has access to the Proprietary Information and that the disclosure or
misuse of such Proprietary Information could irreparably damage the Companies
and/or their respective clients or customers.

      (c) Nondisclosure to others. Except as directed by Mercury in writing or
verbally, Antonoff shall not at any time during or after the Term disclose any
Proprietary Information to any person whatsoever, examine or make copies of any
reports or other documents, papers, memoranda or extracts for use other than in
connection with his duties with Mercury or utilize for his own benefit or for
the benefit of any other party any such Proprietary Information and will use
reasonable diligence to maintain the confidential, secret or proprietary
character of all Proprietary Information.

      (d) Survivability. Antonoff acknowledges that his obligations hereunder
shall continue beyond the Term with respect to any Proprietary Information (as
defined in Article Sixth, paragraph (a) hereof) which came into his possession
during the Term.

      Seventh:     Expenses

      Antonoff is authorized to incur reasonable expenses for promoting the
business of Mercury, including expenses for entertainment, travel and similar
items but only in accordance with the policies of the Board of Directors of
Mercury's Chief Executive Officer, as from time to time adopted. Mercury will
reimburse Antonoff for all such reasonable expenses upon the presentation by
Antonoff, from time to time, of an itemized account and documentation of such
expenditures in sufficient detail to allow Mercury to claim an income tax
deduction for each paid item, if such item is deductible.

      Eighth:      Fringe Benefits

      (a) Participating in General Plans. Antonoff shall have such employee
benefits (including medical insurance, life insurance, 401(k) and disability
insurance plans) as Mercury shall from time-to-time establish, promulgate or
keep in effect for the benefit of its management level employees. Such benefits
will include company paid medical insurance for Antonoff and his family under
Mercury's medical insurance plans. Antonoff shall be required to comply with,
and be entitled to benefits only in accordance with, the terms and conditions of
such plans. Nothing contained in this paragraph (a) of Article Eighth, however,
shall be construed to require Mercury to establish any life, disability or
medical insurance plans not in existence on the date hereof, to continue any
plans in existence on the date hereof, to prevent Mercury from modifying and/or
terminating any of the plans in existence on the date hereof or otherwise
require Mercury to take special steps to insure the eligibility of Antonoff or
his dependents under the provisions of such plans, and no such act or omission
shall be deemed to affect this Agreement or to require modification of the
compensation, additional benefit or other provisions contained herein.

      (b) Stock Options. Antonoff shall be entitled to the grant of stock
options as from time to time determined in the sole discretion of the Board of
Directors.

      (c) 2002 Management Stock Purchase Plan.

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          (i) By virtue of his eligibility to participate in the 2002 Management
      Stock Purchase Plan, Antonoff may purchase from CFK Partners, an Illinois
      general partnership, up to 25,000 unregistered shares of the common stock
      of Mercury, $0.01 par value, at a price of $7.50 per share (the "Purchase
      Price"), such purchase to be funded by Mercury.

          (ii) In the event Antonoff voluntarily leaves the full-time employment
      of Mercury or any of its subsidiaries or related companies for any reason
      whatsoever without the prior consent of Mercury, or in the event
      Antonoff's employment is terminated with or without "cause", as defined in
      Article 9 hereof (except pursuant to Article 11(a) of the Employment
      Agreement or as set forth below), or in the event Antonoff dies or becomes
      disabled (hereinafter the "Date of Discharge"), Antonoff or his estate
      shall be obligated to repay the sums provided by Mercury hereunder,
      provided, however, that, in connection with Antonoff's employment with
      Mercury, Antonoff's obligations hereunder shall be forgiven by the
      percentage equal to the product of (i) 10% and (ii) the number of years
      from the date hereof to the Date of Discharge, with the number of years
      calculated on a March 1st fiscal year (so that if, for example, the Date
      of Discharge is April 1, 2004, the number of years calculated hereunder
      shall be 2). Antonoff shall receive 10% of the original amount of stock
      purchased on the anniversary date of the Employment Agreement's execution
      and will be fully vested and eligible to vote those shares. Antonoff shall
      have no obligation to repay Mercury if he remains employed by Mercury
      after March 1, 2012. Mercury shall be granted a secured interest as a
      creditor of Antonoff in the event Antonoff defaults in his obligation to
      Mercury as herein set forth and Mercury will designate an escrow to hold
      the shares underlying the remaining debt obligation. In the event Antonoff
      terminates his employment pursuant to Article 11(a) of the Employment
      Agreement or is terminated by Mercury for any reason following an event
      set forth in Article 11(a) of his Employment Agreement, Antonoff shall
      have no further obligation to repay Mercury all or any portion of the
      Purchase Price. While Antonoff has any obligation to Mercury hereunder,
      Antonoff shall be obligated to comply with directions of the Board of
      Directors of Mercury with respect to the voting of those shares held in
      escrow purchased by Antonoff hereunder.

      (d) Vacation. Antonoff shall be entitled each year to a vacation of four
(4) weeks, during which time his compensation shall be paid in full.

      Ninth:       Mercury's Right to Terminate For Cause

      (a) Cause. Mercury may at any time during the term of this Agreement
discharge Antonoff for "cause." The term "cause" is defined herein as Antonoff's
(i) misappropriation of corporate funds, fraud, embezzlement or other illegal
conduct to the detriment of Mercury, (ii) negligence in the execution of his
material assigned duties or Antonoff's voluntary abandonment of his job for any
reason other than disability; (iii) refusal or failure, after not less than 20
days written notice that such refusal or failure would constitute a default
hereunder, to carry out any reasonable and material direction from the Board of
Directors given to him in writing; (iv) conviction of a felony; (v) material
breach or violation of the terms of this Agreement, which breach or violation
shall not have been fully cured (as determined by the Board of Directors acting
in good faith) by Antonoff within 20 days after receipt of written notice of the
same from the Board of Directors; (vi) Antonoff's death or disability (except
that, in the event of Antonoff's disability, Mercury shall, at

                                       4
<PAGE>

Antonoff's request, prior to discharge, grant Antonoff a leave of absence of up
to six months or such longer period of time as may be required by law); or (vii)
Antonoff's engagement in drug or alcohol abuse. Antonoff shall be terminated
only following a finding of "cause" in a resolution adopted by majority vote of
the Board of Directors of Mercury.

      (b) No Rights Following Cause Termination. Following a termination of
Antonoff's employment with Mercury "for cause" pursuant to paragraph (a) of this
Article Ninth: (i) all rights and liabilities of the parties hereto shall cease
and this Agreement shall be terminated (subject to the continuing obligations of
Antonoff pursuant to Article Sixth and Twelfth hereof); and (ii) Antonoff shall
not be entitled to receive any severance benefits, salary, other benefits or
compensation of any kind (except for health insurance continuation as required
by COBRA, salary accrued through the date of termination and accrued vacation
pay as required by law) either as consideration for his employment or in
connection with the termination of his employment. In the event that Antonoff
asserts that his voluntary termination was actually a constructive termination,
Mercury shall be entitled to assert as "cause" for such termination any grounds
present at the time of such termination which the Board of Directors could have
asserted as "cause" if called upon to terminate Antonoff.

      Tenth:       Termination Without Cause

      (a) Rights Following Termination Without Cause. Should Antonoff be
discharged by Mercury at any time during the term of this Agreement except as
provided in Article Ninth, Mercury hereby agrees to pay Antonoff within thirty
(30) days from such discharge the lesser of one year's Base Compensation or the
Base Compensation that would otherwise be paid to him over the remaining term of
this Agreement, with a minimum of six (6) months base compensation.

      (b) No Additional Rights. Except as set forth above in paragraph (a) of
this Article Tenth following a termination of Antonoff's employment by Mercury
other that pursuant to Article Ninth above and Article Eleventh below: (i) all
rights and liabilities of the parties hereto shall cease and this Agreement
shall be terminated (subject to the continuing obligations of Antonoff pursuant
to Articles Sixth and Twelfth); and (ii) Antonoff shall not be entitled to
receive any severance benefits, salary, other benefits or compensation of any
kind (except for health insurance continuation as required by COBRA and accrued
vacation pay as required by law) either as consideration for his employment or
in connection with the termination of his employment.

      Eleventh:    Right to Voluntary Termination by Antonoff

      (a) Conditions for Termination by Antonoff. In the event that:

          (i) Any "person" other than CFK Partners or an affiliate of CFK
      Partners is or becomes a "beneficial" owner, "directly or indirectly", of
      stock of Mercury representing 50% or more of the total voting power of
      Mercury's then outstanding stock, without the written consent of the Board
      of Directors of Mercury; or

          (ii) Mercury is acquired by another entity through the purchase of
      substantially all of its assets, the purchase of all of its outstanding
      voting securities or a combination thereof, without the consent of the
      Board of Directors of Mercury; or

                                       5
<PAGE>

          (iii) Mercury is merged with another entity, consolidated with another
      entity or reorganized in a manner in which any "person" other than CFK
      Partners or an affiliate of CFK Partners is or becomes a "beneficial"
      owner, "directly or indirectly", of stock of the surviving entity
      representing 50% or more of the total voting power of the surviving
      entity's then outstanding stock, without the consent of the Board of
      Directors of Mercury; or

          (iv) During any period of one, two or three consecutive years,
      individuals who at the beginning of any such period constitute the
      directors of Mercury cease for any reason to comstitute at least a
      majority thereof unless the election, or the nomination or election by
      Mercury's stockholders, of each new director of Mercury was approved by a
      vote of at least two-thirds of such directors of Mercury then still in
      office who were directors of Mercury at the beginning of any such period;

      then, if following any of the events set forth in clauses (i), (ii),
(iii) or (iv), Antonoff's duties are substantially altered or Antonoff is
demoted for cause, Antonoff shall have the right and option to voluntarily
terminate this Agreement upon written notice to Mercury. All terms used in
quotations in clauses (i) and (iii) shall have the meanings assigned to such
terms in Section 13 of the Securities Exchange Act of 1934 and the rules,
regulations, releases and no-action letters of the Securities and Exchange
Commission promulgated thereunder or interpreting any of the same. For purposes
of clauses (i) and (iii), the term "affiliate" shall have the meaning assigned
to such term in Rule 144 promulgated by the Securities and Exchange Commission
under the Securities Act of 1933, as amended, and the releases and no-action
letters interpreting the same.

      (b) Rights Following Voluntary Termination After a Change of Control.
Following any voluntary termination of employment by Antonoff pursuant to
paragraph (a) of this Article Eleventh, Antonoff shall be entitled to be paid by
Mercury within thirty (30) days of such termination by Antonoff, the lesser of
one year's Base Compensation or the entire balance of his Base Compensation
remaining to be paid to Antonoff over the full remaining term of this Agreement.

      (c) No Additional Rights. Except as set forth above in paragraph (b) of
this Article Eleventh, following a voluntary termination of Antonoff's
employment with Mercury pursuant to paragraph (a) of this Article Eleventh: (i)
all rights and liabilities of the parties hereto shall cease and this Agreement
shall be terminated (subject to the continuing obligations of Antonoff pursuant
to Articles Sixth and Twelfth); and (ii) Antonoff shall not be entitled to
receive any severance benefits, salary, other benefits or compensation of any
kind (except for health insurance continuation as required by COBRA and accrued
vacation pay as required by law) either as consideration for his employment or
in connection with the termination of his employment.

      Twelfth:     Restrictive Covenant

      Antonoff covenants and agrees that during the period commencing with the
date hereof and ending six (6) months from the date Antonoff's employment with
Mercury is terminated for "cause" or by reason of Antonoff's voluntary
termination of employment from Mercury (the "Non-Compete Period"), Antonoff will
not compete or attempt to compete with or become associated with any business
which competes with the Companies' government contracts, cargo, commercial
aviation, fuel sales, fixed base operations, or any business activities of the
Companies existing on or developed subsequent to the date hereof. Antonoff
covenants and agrees that he will not, without the prior written consent of
Mercury during the Non-Compete Period: (a) solicit any customer of the
Companies; (b) solicit any contracts which were either being solicited by, or
which were under contract with, the Companies by performing or causing to be
performed any work which was either being solicited by, or which was under
contract with, Mercury; or (c) induce any sales, operating,

                                       6
<PAGE>

technical or other personnel of the Companies to leave the service, employ or
business of the Companies. Antonoff agrees that he will not violate this Article
Eleventh: (a) directly or indirectly; (b) in any capacity, either individually
or as a member of any firm; (c) as an officer, director, stockholder, partner or
Antonoff of any business; or (d) through or with any persons, relatives (either
through blood or marriage), firms, corporations or individuals controlled by or
associated with him (each and every such method of violation referred to in
clauses (a) through (d) shall hereinafter be referred to as an "indirect
violation"). Antonoff further agrees that doing or causing to be done any of the
actions prohibited in this Article Eleventh by means of an indirect violation
shall constitute a violation of this Article Eleventh as though violated by
Antonoff, subject to all of the remedies to Mercury provided for herein and as
otherwise provided by law.

      Thirteenth:  Arbitration; Governing Law.

      Any controversy or claim arising out of, or relating to this Agreement or
the breach thereof, shall be settled by binding arbitration in the City of Los
Angeles pursuant to the laws of the State of California in accordance with the
rules then obtaining of the America Arbitration Association, and judgments upon
the award rendered my be entered in any court having jurisdiction thereof. This
Agreement shall be governed by and construed in accordance with the substantive
laws of the State of California. The arbitrators shall have the power in their
discretion to award attorneys' fees and other legal costs and expenses to the
prevailing party in connection with any arbitration.

      Fourteenth:  Notices

      Any notice required or permitted to be given under this Agreement shall be
sufficient if in writing and sent by certified mail to his residence, in the
case of Antonoff, or to its principal office, in the case of Mercury.

      Fifteenth:   Waiver of Breach

      The waiver by Mercury of a breach of any provision of this Agreement by
Antonoff shall not operate or be construed as a waiver of any subsequent breach
by Antonoff.

      Sixteenth:   Assignment

      The rights and obligations of Mercury under this Agreement shall inure to
the benefit of and shall be binding upon the successors and assigns of Mercury.

      Seventeenth: Entire Agreement; Written Amendment

      This instrument contains the entire agreement of the parties with respect
to the subject matter hereof. This Agreement may only be amended, modified,
extended or discharged and the provisions of this Agreement may only be waived
by an agreement in writing signed by the party against whom enforcement of any
waiver, change, modification, extension or discharge is sought.

      Eighteenth:  Equitable Relief; Partial Enforcement

      Mercury and Antonoff have agreed that violation or breach of Articles
Sixth and Eleventh will result in irreparable injury to the Companies and shall
entitle the Companies to equitable relief

                                       7
<PAGE>

in addition to any other remedies provided at law. Mercury and Antonoff have
further agreed in the event that only a portion of Articles Sixth or Eleventh
shall be deemed enforceable or valid that portion of such Articles as shall be
enforceable or valid shall be enforced. Mercury and Antonoff have further agreed
that the court making a determination of the validity or enforceability of such
Articles shall have the power and authority to rewrite the restrictions
contained in such Articles to include the maximum portion of the restrictions
included within such Articles as are enforceable, valid and consistent with the
intent of the parties as expressed in such Articles.

      IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.

                                          MERCURY AIR GROUP, INC.

                                          By:  /s/ Joseph A. Czyzyk
                                             -----------------------------------
                                          Its: Chief Executive Officer

                                          /s/ Steve Antonoff
                                          --------------------------------------
                                          Steve Antonoff

                                       8

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