1011696--3/31/2006--AIRNET_SYSTEMS

related topics

{financial, litigation, operation}

{cost, regulation, environmental}

{provision, law, control}

{regulation, government, change}

Loss of AirNet Management s Indirect Air Carrier Standard Security Program approval could adversely affect AirNet s business. Changes in government regulations regarding the transportation of hazardous materials may increase AirNet s costs of transporting such shipments or reduce AirNet s ability to transport such shipments. Reclassification of ground couriers as employees rather than independent contractors could impact AirNet s operating costs and subject it to back taxes and other liabilities. Changes to current transportation security requirements or procedures could adversely impact AirNet s ability to efficiently conduct AirNet s air and ground operations to meet AirNet s current delivery parameters or significantly increase costs to transact those operations. Catastrophic accidents involving AirNet s Passenger Charter aircraft could result in a significant reduction in AirNet s business and damage to the Jetride brand. Environmental concerns may arise in connection with AirNet s operation at its new facility on leased land with known pollution conditions. Failure to renew party status to Department of Transportation E-7060 would result in significant loss of Express Services revenue. Anti-takeover provisions may delay or prevent an acquisition or change in control of AirNet by a third party. AirNet s substantial indebtedness could adversely affect AirNet s financial condition and prevent AirNet from fulfilling its obligations.

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1011696--3/31/2006--AIRNET_SYSTEMS_INC