Document:

EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (hereinafter, this "Agreement"), made and
entered into in the City of Washington, D.C., this 15th day of August, 1991, by
and between American Utilicraft Corporation, a corporation duly organized and
existing under the laws of the State of Delaware, having its principal office
and place of business at 1801 Robert Fulton Drive, City of Reston, Virginia
(hereinafter, the "Corporation"), and James S. Carey, residing at 6114 Gothic
Lane, Bowie, State of Maryland (hereinafter, "Carey").

                              W I T N E S S E T H:

         1. The Corporation hereby employs Carey, and Carey agrees to work for
the Corporation as Vice President of Marketing of the Corporation, reporting to
the President and Chief Executive Officer.

         2. This Agreement shall expire on 28 February 1996, unless sooner
terminated as hereinafter provided. In addition to the arrangements for
termination hereinafter provided, it is agreed between the parties that, until
the major start-up financing (approximately $20,000,000) of the Corporation is
achieved, this Agreement may be summarily terminated, that is, without notice,
in the sole discretion of the President and Chief Executive Officer of the
Corporation.

         3. Carey agrees to devote his full time efforts to his duties as Vice
President of Marketing for the profit, benefit and advantage of the business of
the Corporation.

         4. (a) The Corporation agrees to pay Carey a basic salary at the rate
of Sixty Thousand Dollars ($60,000) per annum, payable in semi-monthly
installments, for all the services to be rendered by Carey hereunder, including
service as a member of a committee, and any other duties related to his position
required of him by the President and Chief Executive Officer. The basic salary
above-stated is understood by the parties to this Agreement to be payable to
Carey during the period in which the Corporation is developing the FF-1080
aircraft and seeking its Federal Aviation Administration (hereinafter "FAA")
aircraft type certification.

             (b) When the FAA certification is achieved, the basic salary
payable to Carey will increase to One Hundred Thousand Dollars ($100,000.00) per
annum effective the first (1st) day of the month in which the FAA issues the
FF-1080 aircraft type certificate to the Corporation.

<PAGE>

             (c) The basic salary payable to Carey will further increase to One
Hundred Twenty-Five Thousand ($125,000.00) per annum effective the first (1st)
day of the month in which the Corporation delivers production aircraft number
twenty-four (24).

             (d) Basic salary payments to Carey under this Agreement shall begin
on the first (1st) day of the month in which the major start-up financing
(approximately $20,000,000) of the Corporation is achieved.

             (e) The basic salary payments made to Carey under this paragraph
shall be adjusted annually, effective the first (1st) day of the thirteenth
(13th) month after any such payment under subparagraphs (a), (b) or (c) above
begins, by the percentage of the annual rate of change in the Consumer Price
Index for the twelve (12) months preceding the above effective date.

         5. The Corporation agrees that it will pay Carey, as a bonus, an
additional sum amounting to one quarter of one percent (.25%) of the basic
delivered invoice price (not including optional equipment) of an FF-1080
aircraft delivered to commercial concerns, worldwide, (including commercial air
carriers when owned and/or operated by a foreign government) as, and only as,
responsibility for such sales may be assigned to Carey by the President and
Chief Executive Officer. Payments of the additional sum payable to Carey under
this paragraph shall be made on the first (1st) working day of the month
following the month in which aircraft deliveries are made and final payment on
such deliveries has been received by the Corporation regardless of whether or
not this Agreement is then in effect.

         6. The Corporation and Carey agree that the geographical location at
which Carey will devote the major portion of his time and efforts to his duties
as Vice President of Marketing is at the office facility of the Corporation in
Reston, Virginia.

         7. The Corporation agrees to pay all reasonable expenses incurred by
Carey in furtherance of the business of the Corporation, including travel and
entertainment expenses. The Corporation agrees to reimburse Carey for any such
expenses paid out by him in the first instance, upon submission by him of a
statement itemizing such expenses.

         8. If Carey shall, during the term of his employment under this
Agreement, be absent from work because of illness or other cause for a period,
or aggregate of periods, in excess of six (6) months in any one (1) year of the
term of employment, the Corporation shall have the right to terminate this
Agreement on one hundred eighty (180) days notice to Carey. In that event, the
Corporation shall pay Carey his compensation to the date of termination.

<PAGE>

         9. Carey agrees that the Corporation may, from time to time, apply for
and take out in its own name and at its own expense, life, health, accident, or
other insurance upon Carey that the Corporation may deem necessary or advisable
to protect its interests hereunder; the total amount of such life insurance
shall not exceed One Million Dollars ($1,000,000.00) without the written consent
of Carey. Carey agrees to submit to any medical or other examination necessary
for such purpose and to assist and cooperate with the Corporation in procuring
such insurance; and Carey agrees that other than his rights as a shareholder he
shall have no right, title, or interest in or to such insurance.

         10. In the event of the death of Carey during the term of this
Agreement and after the major start-up financing is in place, the Corporation
agrees to pay Carey's legal representatives the sum of Five Thousand Dollars
($5,000.00).

         11. Carey agrees that during the term of this Agreement he will not
engage in any other commercial activity, whether or not competitive with the
business of the Corporation, nor be affiliated in any other way as officer,
director, or significant stockholder of another corporation without the written
consent of the President and Chief Executive Officer of the Corporation.

         12. Carey agrees that he shall exercise reasonable care to prevent
disclosure of the Corporation's proprietary information to others and shall not,
himself, at any time during the period of this Agreement and after its
termination for any reason, disclose the Corporation's proprietary information
to others and will not use such information for any purpose except as
contemplated by this Agreement. The term "proprietary information" as used
herein includes, in addition to information so designated and labeled by the
Corporation, all business, financial, technical and design information related
to the Corporation's developmental and production programs whether or not
designated and labeled as proprietary information.

         13. Carey agrees that, for a period of three (3) years after leaving
the employ of the Corporation for any reason, he will not engage in any way,
directly or indirectly, in any business competitive with the business of the
Corporation.

         14. (a) After the major start-up financing (approximately $20,000,000)
of the Corporation is achieved, either party shall have the right to terminate
this Agreement upon one hundred eight (180) days notice to the other. If Carey
terminates this Agreement, the Corporation shall pay Carey until the date of
termination. Except for any reason that would be considered for cause, if the
Corporation terminates the Agreement, it shall forthwith pay additional
compensation to Carey in the form of a lump sum payment of two (2) times the
average amount of the annual basic salary then payable under paragraphs 4 (a),
(b) or (c) above.

<PAGE>

             (b) For purposes of paragraph (a) above, a reason that could be
considered for cause, within the sole discretion of the President and Chief
Executive Officer, would be the failure of the Corporation to have sold at least
twenty-five (25) FF-1080 aircraft or derivative aircraft during the first full
calendar year (January 1 through December 31) after the major start-up financing
(approximately $20,000,000) of the Corporation is achieved, and to sell at least
twenty-five (25) FF-1080 or derivative aircraft each calendar year thereafter.

         15. (a) For protection of Carey against possible termination after a
change of control (defined below) of the Corporation and to induce Carey to
continue to serve in his capacity as Vice President of Marketing or in such
other capacity to which he may be elected or appointed, the Corporation will
provide severance benefits in the event Carey's employment is terminated after a
change of control.

             (b) "Change of control" shall have occurred if, at any time after
the Corporation has acquired its major start-up financing, (a) any person (as
used in Sections 13(d) and 14(d) of the Securities Exchange Act ("SEA") of 1934)
becomes the beneficial owner (as defined in Rule 13(d)-3 of the SEA) of a total
of twenty percent (20%) or more of the outstanding shares of the Corporation's
common stock, or (b) the Board of Directors of the Corporation is composed of a
majority of directors who were not directors of the Corporation on the date of
this Agreement, or (c) the change is of the type that is required to be reported
under Item 5(f) of Schedule 14 of Regulation 14A promulgated under the SEA.

             (c) If a change of control has occurred, Carey shall be entitled to
severance benefits if his employment is terminated by him due to:

                  (i) the assignment to him of any duties not consistent with
his present position, or a change in titles or offices, or any failure to
re-elect him to any positions held on the date of the change of control;

                  (ii) a reduction in salary or discontinuance of any bonus
plans in effect on the date of the change of control; or

                  (iii) a change in geographical location of where his position
is based in excess of twenty (20) miles or required travel in excess of his
usual business travel schedule.

             (d) Carey shall be entitled to severance benefits if his employment
is terminated by the Corporation after a change of control. Such termination
must not be due to any reason that would be considered for cause.

             (e) Severance benefits after a change of control has occurred shall
be:

<PAGE>

                  (i) a lump sum payment of ten (10) times the amount of the
annual basic salary then payable under paragraphs 4 (a), (b) or (c) above.

                  (ii) allowance of surrender of all outstanding stock options,
with the price to be determined by taking the difference between the option
price and the price of the stock on the date of the change of control or the
date of termination, whichever is higher; and

                  (iii) all employee benefits in effect and applicable to Carey
on the date of the change of control will be retained and paid by the
Corporation for Carey for a period of two (2) years. These benefits shall
include all health, accident, and disability plans as well as any life insurance
plans provided by or through the Corporation.

             (f) Carey shall not be required to mitigate the amount of any
payment provided under these severance benefits by seeking other employment and
none of these payments may be reduced by any future salary he may earn.

             (g) In the event of a change of control, the Corporation is aware
that the Board of Directors or a shareholder or shareholders of the Corporation
may cause the Corporation to refuse to comply with its obligations under this
paragraph, or may cause the Corporation to institute litigation seeking to have
this paragraph declared enforceable, or may take other action to deny Carey the
benefits intended to be provided under this paragraph. It is the intent of the
Corporation that Carey not be required to incur expenses in enforcing his rights
under this paragraph by litigation or other legal action because the costs and
expenses thereof would substantially detract from the benefits intended to be
extended to Carey under this paragraph.

             (h) If, following a change of control, Carey determines that the
Corporation has failed to comply with any of its obligations under this
paragraph or in the event the Corporation or any other person takes action to
declare this paragraph void or enforceable, or institutes any litigation or
other legal action designed to deny Carey the benefits intended to be extended
under this paragraph, the Corporation authorizes Carey to retain counsel of his
choice at the Corporation's expense to represent Carey in connection with the
initiation or defense by Carey of any litigation or legal action, whether by or
against the Corporation, any director, officer, shareholder, or any other person
affiliated with the Corporation, in any jurisdiction.

             (i) Despite any previously existing attorney-client relationship
between the Corporation and counsel retained by Carey, the Corporation hereby
provides that Carey may enter into an attorney-client relationship with such
counsel. The Corporation and Carey agree that a confidential relationship will
exist between Carey and such counsel.

<PAGE>

             (j) The Corporation hereby authorizes that the reasonable fees and
expenses of counsel retained by Carey shall be paid or reimbursed to Carey by
the Corporation on a regular, periodic basis upon Carey's presentation of a
statement or statements prepared by counsel in accordance with its customary
practices, up to a maximum aggregate amount of Two Hundred Fifty Thousand
Dollars ($250,000.00).

         16. The Corporation shall have the right, with the consent of Carey, to
assign this Agreement to its successors or assigns and all covenants and
agreements hereunder shall inure to the benefit of and be enforceable by or
against its said successors or assigns. The terms "successor" and "assign' shall
include any corporation which buys all or substantially all of the Corporation's
assets, or all of its stock, or with which it merges or consolidates.

         17. The Corporation shall indemnify Carey and hold him harmless against
any claims or legal action of any type brought against Carey with respect to his
activities as Vice President of Marketing of the Corporation and in such other
capacity to which he may be appointed or elected and with respect to his
services as a member of a committee and other duties related to his position,
whether such claims or actions be rightfully or wrongfully brought or filed, and
against all costs incurred by Carey therein. In the event an action should be
filed with respect to the subject of this indemnity and hold harmless agreement,
the Corporation agrees that Carey may employ an attorney of Carey's own
selection to appear and defend the action, on behalf of Carey, at the expense of
the Corporation. Carey, at his option, shall have the sole authority for the
direction of the defense, and shall be the sole judge of the acceptability of
any compromise or settlement of any claims or actions against Carey.

         18. Any dispute concerning any questions of law or fact arising out of
the circumstances of employment under this Agreement shall be determined by
arbitration. The controversy shall be submitted to the American Arbitration
Association for final determination.

         19. Any waiver by either party of a breach of any provision of this
Agreement shall not operate as or be construed as a waiver of any subsequent
breach thereof.

         20. If any provision of this Agreement is declared invalid by any
Tribunal, then such provision shall be deemed automatically adjusted to conform
to the requirements for validity as declared at such time and, as so adjusted,
shall be deemed a provision of this Agreement as though originally included
herein. In the event that the provision invalidated is of such a nature that it
cannot be so adjusted, the provisions shall be deemed deleted from this
Agreement as though the provision had never been included herein. In either
case, the remaining provisions of this Agreement shall remain in effect.

         21. This Agreement may be extended or modified by mutual agreement in
writing in the form of a numbered amendment hereto.

<PAGE>
         22. This Agreement shall be construed in accordance with the laws of
the State of Delaware.

         23. This Agreement consists of eight (8) pages.

         IN WITNESS WHEREOF, the Corporation has hereunto signed its name by its
President and Chief Executive Officer, and the other party hereto has signed his
name, all as of the day and year first above written.

                                                  AMERICAN UTILICRAFT
                                                  CORPORATION

                                                  By: /s/ John J. Dupont
                                                     ---------------------------
                                                     John J. Dupont
                                                     President and Chief
                                                     Executive Officer

                                                  /s/ James S. Carey
                                                  ------------------------------
                                                  James S. CareyAMENDMENT NUMBER ONE

                                       TO

                              EMPLOYMENT AGREEMENT

         THIS AMENDMENT NUMBER ONE (hereinafter, this "Amendment"), made and
entered into in the City of Reston, Virginia this 21st of January, 1993, renews
and amends the EMPLOYMENT AGREEMENT made and entered into on the 28th day of
February, 1991 (hereinafter, the "Agreement"), by and between American
Utilicraft Corporation (hereinafter, the "Corporation"), and John J. Dupont
(hereinafter, "Dupont"), pursuant to paragraph 20 of the Agreement, in the
following respects:

                                   WITNESSETH:

         1. The term of the Agreement, set forth in paragraph 2 thereof, is
renewed for a six (6) year period, that is until February 28, 1999, unless
sooner terminated as provided in the Agreement.

         2. The following new paragraphs 5.1 and 5.2 are added to the Agreement:

                  "5.1 The Corporation agrees to pay Dupont commissions on the
sale of FF-1080 aircraft, and derivative aircraft, on the following bases:

                           (a) For aircraft sold by the Corporation or its
partner or partners in the international joint venture contemplated by the
Corporation's eight year business plan, Dupont shall be paid 40% of the
commissions paid to the Corporation by the international joint venture company
in accordance with the terms of the international joint venture arrangement.

                           (b) in the event that the international joint venture
contemplated by the Corporation's eight year business plan is not formed, Dupont
shall be paid two percent (2%) of the gross sale price of aircraft, including
optional equipment, sold and delivered by the Corporation.

                           (c) Payments of the commissions payable to Dupont
under paragraph (a) above shall be made on the first (1st) working day of the
month following the month in which the commission on such aircraft sales has
been paid to the Corporation by the international joint venture company
regardless of whether or not this Agreement is then in effect.

                           (d) Payments of the commissions payable to Dupont
under paragraph (b) above shall be made on the first (1st) working day of the
month following the month in which aircraft deliveries are made and final
payment on such deliveries has been received by the Corporation regardless of
whether or not this Agreement is then in effect."

<PAGE>

                  "5.2 The Corporation agrees that on the first working day of
the month following the date on which the major start-up financing of the
Corporation is achieved, the Corporation shall lend Dupont a sum of money no
greater than Five Hundred Thousand Dollars ($500,000) on the following terms:

                           (a) The amount of the loan, not to exceed Five
Hundred Thousand Dollars ($500,000), shall be as determined in writing by Dupont
on the date of the loan.

                           (b) The total amount of the loan shall be disbursed
on the date of the loan directly to third parties by the Corporation in the
amounts and to the parties directed in writing by Dupont.

                           (c) The total amount of the loan shall be repaid,
without interest, by Dupont from and at the rate of fifty percent (50%) of the
first commissions paid to Dupont on the sale of aircraft pursuant to paragraph
5.1 above.

                           (d) This paragraph 5.2 is understood to be the legal
and binding statement of the terms of the loan and no additional documentation
pertaining to the loan shall be executed by the parties to this Agreement."

         3. This Amendment consists of two (2) pages, including this signature
page.

         IN WITNESS WHEREOF, the Corporation has hereunto signed its name by its
Corporate Secretary, for the Board of Directors, and Dupont has signed his name,
all as of the day and year first above written.

                                        AMERICAN UTILICRAFT CORPORATION

                                        By: /s/ Chester D. Taylor
                                           ---------------------------------
                                           Chester D. Taylor, Jr.
                                           Corporate Secretary

                                        /s/ John J. Dupont
                                        ------------------------------------
                                        John J. Dupont

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