10-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2004

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

Atlas Air Worldwide Holdings, Inc.
(Exact name of registrant as specified in its charter)

Delaware	0-25732	13-4146982
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
2000 Westchester Avenue, Purchase, New York		10577
(Address of principal executive offices)		(Zip Code)
(914) 701-8000
(Registrant’s telephone number, including area code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
None

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

Common Stock, $0.01 Par Value
(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes o No þ

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form l0-K or any amendment to this Form 10-K. þ

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2) Yes o No þ

The aggregate market value of the registrant’s Common Stock, par value $.01 per share, held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of June 30, 2004: $1,726,988.¹ As of June 1, 2005, there were 3,650,149 shares of the registrant’s Common Stock, par value $.01 per share, outstanding.

APPLICABLE TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes o No þ

DOCUMENTS INCORPORATED BY REFERENCE:

None

¹ The registrant emerged from Chapter 11 bankruptcy proceedings on July 27, 2004. The shares of common stock traded prior thereto had nominal value and were cancelled and extinguished at the time of the registrant’s emergence from bankruptcy.

EXPLANATORY NOTE

          Atlas Air Worldwide Holdings, Inc., after having filed a voluntary bankruptcy petition for relief under Chapter 11 of the United States Bankruptcy Code on January 30, 2004 and emerging from bankruptcy on July 27, 2004, did not timely file its Annual Report on Form 10-K for the fiscal year ended December 31, 2004. The information reported herein is as of December 31, 2004 unless otherwise noted.

TABLE OF CONTENTS

			Page
PART I
	Item 1.	Business	1
	Item 2.	Properties	21
	Item 3.	Legal Proceedings	21
	Item 4.	Submission of Matters to a Vote of Security Holders	25
PART II
	Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	26
	Item 6.	Selected Financial Data	28
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operation	29
	Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	47
	Item 8.	Financial Statements and Supplementary Data	48
	Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	92
	Item 9A.	Controls and Procedures	92
	Item 9B.	Other Information	94
PART III
	Item 10.	Directors and Executive Officers of the Registrant	95
	Item 11.	Executive Compensation	100
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	105
	Item 13.	Certain Relationships and Related Transactions	106
	Item 14.	Principal Accountant Fees and Services	107
PART IV
	Item 15.	Exhibits and Financial Statement Schedule	108

FORWARD LOOKING STATEMENTS AND INFORMATION

          This Annual Report on Form 10-K (the “Report”) and other statements issued or made from time to time by or on behalf of Atlas Air Worldwide Holdings, Inc. (“AAWW” or “Holdings”) or its management contain statements that may constitute “Forward-Looking Statements” within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements and information are based on management’s beliefs, plans, expectations, and assumptions and on information currently available to AAWW. The words “may,” “should,” “expect,” “anticipate,” “intend,” “plan,” “continue,” “believe,” “seek,” “project,” “estimate” and similar expressions used in the Report that do not relate to historical facts are intended to identify forward-looking statements.

          The forward-looking statements in the Report are not representations or guarantees of future performance and involve certain risks, uncertainties and assumptions. Such risks, uncertainties and assumptions include, but are not limited to, those described in Item 1, “Risk Factors.” Many of such factors are beyond AAWW’s control and are difficult to predict. As a result, AAWW’s future actions, financial position, results of operations and the market price for AAWW’s common stock could differ materially from those expressed in any forward-looking statements made by AAWW. Readers are therefore cautioned not to place undue reliance on forward-looking statements. AAWW also does not intend to publicly update any forward-looking statements that may be made from time to time by, or on behalf of, AAWW, whether as a result of new information, future events or otherwise.

PART I

ITEM 1. BUSINESS

Overview

          AAWW, is a holding company with two principal wholly owned operating subsidiaries—Atlas Air, Inc. (“Atlas”) and Polar Air Cargo, Inc. (“Polar”). Collectively, these entities (along with AAWW’s other subsidiaries) are referred to herein as the “Company,” “we,” “us,” or “our.” We provide air cargo and related services throughout the world, serving Asia, Australia, the Middle East, Africa, Europe, South America and the United States through two principal means: (1) contractual lease arrangements in which we provide the Aircraft, Crew, Maintenance And Insurance (“ACMI,” “ACMI Contracts” or, in certain circumstances, “wet leases”); and (2) airport-to-airport scheduled air-cargo service (“Scheduled Service”). We also provide military charter services (the “AMC Charter” business), as well as commercial charter services. We operate exclusively Boeing 747 freighter aircraft. Our operating fleet totaled 43 aircraft at December 31, 2004 and 42 aircraft as of June 1, 2005. The reduction in fleet size was due to the retirement of a Boeing 747-200 aircraft, which was damaged in a runway excursion in January 2005 and which we decided not to repair.

          AAWW was incorporated in Delaware in 2000. Our principal executive offices are located at 2000 Westchester Avenue, Purchase, New York 10577, and our telephone number is (914) 701-8000.

          During the 1990’s, the increased demand for air cargo services, the decrease in passenger airline cargo capacity, and the continuing pressure on the passenger airline industry to reduce operating costs provided air cargo companies with opportunities to expand their air cargo outsourcing services. Most commercial airlines focused their business on transportation of passengers and not air cargo. Nevertheless, most passenger airlines have air cargo customers that require timely and dependable air cargo service. Airlines have serviced such cargo demand through use of “belly” cargo capacity on their scheduled passenger aircraft. Passenger flights are generally scheduled for the convenience of passengers rather than the needs of air cargo customers. Consequently, many airlines outsource to meet their additional air cargo needs, rather than allocating significant resources and expanding their fleet of freighter aircraft to service effectively their air cargo customers. Outsourcing provides a cost-effective and efficient alternative for passenger airlines to maintain and expand the air cargo portion of their business.

          In the early 1990’s, Michael A. Chowdry, the founder of Atlas, observed that passenger airlines were losing money and parking aircraft, while a limited number of high gross weight long-haul cargo aircraft were being more fully utilized. Mr. Chowdry saw an opportunity, secured financing and founded Atlas.

          Atlas began operations in early 1993 with one aircraft. By February 1994, only one year after Atlas received its certification from the Federal Aviation Administration (the “FAA”), Atlas had grown from a single aircraft and 23 employees to four aircraft with over 150 employees.

          From its initial FAA certification in 1993 through 2000, Atlas experienced substantial growth in its fleet and its operating revenues. Though Atlas’ fleet initially grew through the purchase or lease of older Boeing 747 aircraft, most of which were reconfigured from passenger to cargo use, in mid-1997 Atlas placed an order for ten new and higher performance Boeing 747-400 freighters, with an option to purchase up to ten more. By 1998, demand for its services was so strong that Atlas exercised options beyond its initial order of ten Boeing 747-400 aircraft and instead purchased twelve aircraft. In 2000, Atlas’ fleet grew to a total of 36 Boeing 747-200 and 747-400 aircraft. The Company adopted its holding company structure in February 2001, whereby Atlas Air Worldwide Holdings, Inc. became the parent holding company of Atlas. Late in November 2001, the Company expanded its product line by acquiring Polar from General Electric Capital Aviation Services. The acquisition added Polar’s B747 fleet and global Scheduled Service operations to the Company’s existing portfolio of products (See “Strategy”, below). Subsequent to the acquisition of Polar, Atlas and Polar took delivery of four additional 747-400 aircraft in the second half of 2002.

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Events Leading to Our Chapter 11 Filing

          Beginning in 2001, the Company was negatively impacted by a number of developments that affected the Company’s operations and its ability to service its debt and lease obligations. In the years leading up to the filing of a voluntary petition under Chapter 11 (“Chapter 11”) of title 11 of the United States Code, 11 U.S.C. 101 et seq. (the “Bankruptcy Code”) on January 30, 2004, the Company’s debt and lease obligations increased substantially in connection with the refinancing of aircraft and the acquisition of additional aircraft as described above.

          During the period from 2001 to 2004, the Company and air cargo carriers generally, suffered from (i) a challenging economic environment, especially in the technology and telecom sectors, which historically had been large users of air cargo capacity, (ii) reduced demand for air cargo services, and (iii) the events of September 11, 2001. While prior industry projections anticipated continued growth in the air cargo market, the air cargo industry experienced a 9.7 % decline in demand (measured as revenue ton miles) in 2001, representing the worst year-over-year decline on record.

          In October 2002, the Company announced that it would need to restate its financial statements for the 2000 and 2001 fiscal years. The decision to restate was based chiefly on a determination by the Company that certain expenses had been understated in prior years. At that time, the Company anticipated that the restatement would be completed in early 2003.

          The Company was unable to file its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2002 because the restatement had not been completed by the due date of the report. As a result, Deutsche Bank, the agent under two credit facilities maintained by two subsidiaries of the Company, notified these subsidiaries that failure to provide financial statements for the third quarter of 2002 created a default under such facilities. In early January 2003, the Company entered into an amendment and waiver with Deutsche Bank under these two credit facilities to amend the loan agreements maintained by the subsidiaries and to waive certain events of default under the loan agreements and related aircraft leases.

          In response to the challenging operating environment, in early 2003, the Company also embarked on a comprehensive program that included a change in senior management and the initiation of an aggressive operational and financial restructuring plan. Throughout the course of 2003, management implemented significant cost saving initiatives and negotiated with various lessors and secured aircraft creditors to reduce and or defer rents and payments on the Company’s aircraft. By the end of 2003, the Company was able to negotiate binding term sheets and restructuring agreements with a majority of its significant aircraft lenders and lessors.

          A number of the restructuring agreements that the Company entered into prior to filing for bankruptcy required, as part of their implementation, a Chapter 11 filing by the Company. In addition, it was believed that a Chapter 11 filing would help facilitate the restructuring program by establishing one forum for the resolution of claims and implementation of a wide range of restructuring agreements. The Chapter 11 filing was also intended to help facilitate the issuance of the new equity securities required by certain of the restructuring agreements. See Note 3 in the Notes to Consolidated Financial Statements included in Item 8 of Part II of the Report for additional information concerning our restructuring.

Chapter 11 Bankruptcy Proceedings

          On January 30, 2004 (the “Bankruptcy Petition Date”), AAWW, Atlas, Polar and two other of AAWW’s subsidiaries, Airline Acquisition Corp I and Atlas Worldwide Aviation Logistics, Inc. (“Logistics,” and together with AAWW, Atlas, Polar and Acquisition collectively, the “Debtors”) each filed voluntary bankruptcy petitions for relief under Chapter 11, in the United States Bankruptcy Court for the Southern District of Florida (the “Bankruptcy Court”). The Bankruptcy Court jointly administered these cases as In re: Atlas Air Worldwide Holdings, Inc., Atlas Air, Inc., Polar Air Cargo, Inc., Airline Acquisition Corp I, and Atlas Worldwide Aviation Logistics, Inc., Case No. 04-10792 (collectively, the “Chapter 11 Cases”). During the course of the Chapter 11 Cases, the Debtors operated their respective businesses as debtors-in-possession (“DIPs”) under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure and the orders of the Bankruptcy Court. The Consolidated Financial Statements appearing in Item 8 of Part II of this Report include data for all of our subsidiaries, including those that did not file for relief under Chapter 11.

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          The Debtors emerged from bankruptcy protection under the Second Amended Joint Plan of Reorganization (the “Plan of Reorganization”), which (i) was confirmed by the Bankruptcy Court on July 16, 2004 and (ii) after each of the conditions precedent to consummation was satisfied or waived, became effective July 27, 2004 (the “Effective Date”). In accordance with AICPA Statement of Position 90-7, “Financial Reporting by Entities in Reorganization Under the Bankruptcy Code,” the Company adopted fresh-start accounting as of the Effective Date. Reference is made to Item 8 of Part II of the Report for additional information concerning the Company’s reorganization. References to “Predecessor Company” refer to the Company prior to July 28, 2004. References to “Successor Company” refer to the Company after July 27, 2004, following the adoption of fresh-start accounting. As a result of fresh-start accounting, the Successor Company’s Consolidated Financial Statements are not comparable with the Predecessor Company’s Consolidated Financial Statements.

Strategy

          With the completion of our restructuring and our emergence from Chapter 11, our primary objectives are to maintain a safe and efficient operation, streamline our operations, restore and sustain profitability and rebuild stockholder value. We are undertaking a number of significant strategic measures designed to achieve these objectives. These measures include the following:

•	Optimizing our Scheduled Service network so that this business segment can ultimately attain profitability. The elimination of certain unprofitable markets and an increased presence in China are two factors that are expected to help this business segment in its attempt to achieve positive financial results;
•	Continuing our efforts to reduce our overhead and operating costs and to maximize productivity.
	Examples of these measures include (i) reductions in crew travel costs and improvements in crew scheduling and efficiencies, (ii) rationalizing station overhead in connection with our ground operations, and (iii) optimizing efficiencies in our maintenance program and at our maintenance facilities to lower unit maintenance costs;
•	Improving the flexibility and efficiency of our operations by overhauling our procedures in several key facets of flight operations, ground operations and maintenance. In November 2004, we initiated steps to combine the Atlas and Polar pilot-union bargaining units, both of which are represented by the Air Line Pilots Association. We expect this merger to be completed in 2006. We have also begun the process of merging the Atlas and Polar operating certificates into a single certificate. Doing so is expected to eliminate duplicative efforts in the operations and compliance areas. Merger of the operating certificates is expected to occur by the end of the first quarter of 2006. While operations are expected to be consolidated under the Polar certificate, we will continue to do business as two brands—Atlas in the wet leasing or ACMI market, Polar in the Scheduled Service freight market, with each continuing its participation in the charter market. Both brands will maintain their separate identities, but they will derive their lift capacity from a shared operation;
•	Actively managing our asset base by optimizing capacity allocations among our various service types and by selectively disposing of unproductive assets, including our aging 747-200 aircraft, and replacing them with newer more modern aircraft. Systematic implementation of this initiative will enable us to offer our customers new services and fleet types that complement their needs for additional, more modern, lift capacity. Our recent agreement with Israel Aircraft Industries to acquire slots for the potential conversion of four Boeing 747 passenger aircraft to freighter configuration between late 2007 and mid-2008 is an example of our fleet renewal efforts;
•	Pursuing growth opportunities, which may include offering customers new services and fleet types, which may include entry into passenger ACMI business;
•	Continuing our efforts to maximize our financial flexibility, which may include refinancing our debt and issuing new debt and/or equity securities.

          While we still face a number of significant challenges, several of which are beyond our control (see “Risk Factors” in Item 1 of Part I below), we believe that implementing these and certain other strategic measures represent important moves toward restoring and sustaining profitability and enhancing long-term stockholder value.

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Operations

          Introduction. We operate our business through four reportable segments: ACMI Contracts, Scheduled Service, Air Mobility Command (“AMC”) Charter for the U.S. military and Commercial Charter. All reportable segments are directly or indirectly engaged in the business of air cargo transportation but have different economic characteristics, which are separately reviewed by management. Financial information regarding our operating segments may be found in Note 15 “Segment Reporting” in the Notes to the Consolidated Financial Statements included in Item 8 of Part II of the Report.

          ACMI Contracts. Historically, the core of our business has been leasing aircraft to other airlines on an ACMI basis. Under an ACMI contract, customers receive a dedicated aircraft that is crewed, maintained and insured by Atlas in exchange for an agreed level of operation. We are paid a fixed hourly rate for the time the aircraft is operated. All other direct operating expenses, such as fuel, landing fees and ground handling, are generally absorbed by the customer, who also bears the commercial risk of load and yield.

          All of our ACMI contracts provide that the aircraft remain under our exclusive operating control, possession and direction at all times. The ACMI contracts further provide that both the contracts and the routes to be operated may be subject to prior and/or periodic approvals of the United States and foreign governments.

          ACMI contracts reduce the short-term volatility of our operating revenue. They minimize yield and traffic demand risk traditionally associated with the air cargo business and provide a more predictable annual revenue and cost base. All of our revenues, and most of our costs, under ACMI contracts are denominated in U.S. dollars, thus avoiding currency risks associated with international business.

          Our principal ACMI customers include Emirates, Qantas, Air New Zealand, Cargolux, Korean Air, British Airways and Lan Cargo. ACMI contract revenue represented 26.6 % of our operating revenues for the year ended December 31, 2004, as compared to 22.1% and 30.4% for 2003 and 2002, respectively. ACMI contract revenue is recognized as the actual Block Hours operated on behalf of a customer are incurred or according to the minimum revenue guarantee defined in a contract.

          Our ACMI contracts have had terms ranging from two months to five years. At December 31, 2004, we had 21 ACMI contracts covering 21 aircraft, expiring at various times from 2005 to 2009. The original length of these contracts ranged from two months to five years. Emirates Airlines currently our most significant customer, accounted for approximately 34.3% of ACMI revenue and 9.1% of our total operating revenue during 2004. In addition, we have also operated short-term, seasonal ACMI contracts with companies such as UPS, FedEx Corporation (“FedEx”), Lufthansa and El Al, among others, and we anticipate doing so in the future.

          The following table sets forth revenues expected to be derived from our existing ACMI customers having contracts with at least a one-year term as of December 31, for the years indicated (in millions):

2005	$	449
2006		219
2007		77
2008		38
2009		8
	$	791

          Scheduled Service. Polar provides scheduled air cargo services. Its primary customers are the world’s largest international freight forwarders and agents. Polar operates airport-to-airport routes on a specific schedule, and customers pay to have their freight carried on that route and schedule. Polar’s scheduled all-cargo network serves four principal economic regions: North America, South America, Asia and Europe. Polar offers access through its limited-entry operating rights to Japan at Tokyo’s Narita Airport and to China at Shanghai’s Pudong Airport. Beginning as a small, trans-Pacific operator over 10 years ago, Polar’s Scheduled Service operation (“Scheduled Service”) now provides approximately 18 daily departures to 14 different cities in eight countries across four continents. Polar’s customer relationships are supported by the flight frequency and dependability of Polar’s global network support.

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          Scheduled Service is designed to achieve several key objectives: to provide prime-time arrivals and departures on key days of consolidation for freight forwarders and shippers; to coordinate the various departure and arrival combination points necessary to offset directional imbalances of traffic; and to arrange a global connecting or through-service network between economic regions to achieve higher overall yields and load factors. Scheduled Service imposes both load and yield risk on Polar since it generally provides the service regardless of traffic. Unlike Atlas’ ACMI operations, Polar’s Scheduled Service business bears all direct costs of operation, including fuel, insurance, overfly and landing fees, and aircraft and cargo handling. Distribution costs include direct sales costs through our own sales force and through commissions paid to general sales agents. Commission rates are typically between 2.5% and 5.0% of commissionable revenue sold. The Scheduled Service business is highly seasonal, with peak demand coinciding with the retail holiday season, which traditionally begins in September and lasts through mid-December.

          Scheduled Service revenue represented 45.3% of our total operating revenues for the year ended December 31, 2004, as compared to 37.9% and 29.6% for 2003 and 2002, respectively. The majority of Polar’s business is conducted with large multi-national forwarders, which include DHL, Danzas Air and Ocean, EXEL Global Logistics, Expeditors International, EGL Global Logistics, Menlo Logistics and Nippon Express, among others. No single customer accounted for 10% or more of our Scheduled Service revenues for the year ended December 31, 2004.

          In late 2004, we undertook several initiatives to optimize our Scheduled Service business. These included eliminating service to certain unprofitable markets (primarily in India, North America and Asia) and reallocating excess fleet capacity primarily to our ACMI Contract business segment.

          The Asian market is extremely important to Polar, accounting for approximately 50.8%, 47.6% and 47.3% of Polar’s Scheduled Service revenue for the years ended December 31, 2004, 2003 and 2002, respectively. In 2004, we increased our presence in the China market by becoming one of only four U.S. freight operators permitted by the U.S. Department of Transportation (the “DOT”) to serve China on a Scheduled Service basis. Polar began Scheduled Service at Shanghai’s Pudong Airport in December 2004 with six weekly flights. In March 2005, Polar increased this level of service to nine flights. Three additional frequencies were recently awarded by the DOT, for a total of 12 flights per week beginning in March 2006. The DOT’s grant of additional rights next spring will allow Polar to offer twice-daily service to Shanghai on six days each week and to introduce service to Beijing on three of those flights.

          AMC Charter. The AMC Charter business entails providing full planeload charter flights to the U.S. military through the AMC. The AMC Charter business is similar to the Commercial Charter business described below in that we are responsible for the direct operating costs of the aircraft. However, in the case of AMC operations, the price of fuel used during AMC flights is fixed by the military. The contracted charter rates (per ton mile) and fuel prices (per gallon) are established and fixed by the AMC for 12-month periods running from October through September each year. The AMC purchases capacity on a fixed basis annually and on an ad hoc basis continuously. While the fixed business is predictable, Block Hour levels for the ad hoc business are difficult to predict and are subject to fluctuation. The majority of our AMC business in 2004 was conducted on an ad hoc basis.

          We compete for AMC Charter business through a teaming arrangement devised for the allocation of AMC flying among competing carriers. There are currently two groups of carriers, or teams, that compete for AMC business. We are a member of the team led by FedEx. We pay a commission, based on the revenues we receive under such contracts. The AMC Charter business, while profitable, is also our most unpredictable business. Revenues derived from the AMC Charter business represented 20.0% of operating revenues for the year ended December 31, 2004, and 31.1% and 19.6% for 2003 and 2002, respectively.

          Commercial Charter. Our Commercial Charter business segment involves providing a full planeload of capacity to a customer for one or more flights based on a specific origin and destination. Customers include charter brokers, freight forwarders, direct shippers and airlines. Unlike ACMI flying, charter customers pay a fixed charter fee that includes fuel, insurance, landing fees, overfly and all other operational fees and costs. Revenue from the Commercial Charter business is short-term and unpredictable, as are the costs associated therewith.

          Revenues derived from our Commercial Charter business represented just 4.9% of our total operating revenues for 2004. However, when coupled with our AMC Charter operations, the Commercial Charter business

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complements our ACMI and Scheduled Service operations by increasing aircraft utilization during low seasons, positioning flights for scheduled operations in directionally weak markets, enabling performance of extra flights to respond to peak season Scheduled Service demand, diversifying our revenue streams and reducing ferries.

Sales and Marketing

          Atlas and Polar each has its own brand-specific sales and marketing organization. Each has regional offices covering the Americas, Asia and EMEIA (Europe, Middle East, India and Africa). Atlas’s sales organization markets its ACMI services and charter services directly to other airlines and indirect air carriers, as well as to charter brokers and agents. Polar’s sales organization markets its scheduled services and charter services directly, or through a network of offline general sales agents to freight forwarders. Additionally, we have a separate, dedicated Charter Business Unit that manages the AMC Charter business either directly, or indirectly through the Atlas and Polar sales organizations and manages our Commercial Charter business and capacity.

Maintenance

          As noted above, as of June 1, 2005 we operate a fleet of 42 Boeing 747-400 and 747-200 aircraft. The maintenance programs for these aircraft vary according to fleet type. After fuel, maintenance is our second-largest operating expense. Primary maintenance activities include scheduled and unscheduled work on airframes and engines. Scheduled maintenance activities encompass those activities specified in a carrier’s FAA-approved maintenance program. The costs necessary to adhere to this maintenance program will increase over time, based on the age of the aircraft and/or its engines or due to FAA airworthiness directives.

          Scheduled airframe maintenance includes low-level, daily checks that are effected at regular intervals (usually within 24-to-48 hours of completion of a flight) by our maintenance staff or third-party vendors. A/B checks are normally performed on the aircraft (usually at intervals ranging from 400 to 1,100 flight hours) by our maintenance staff or third-party vendors and are generally low-level in nature (see “Glossary” in Item 7 of Part II of the Report). C checks are higher level “heavy” airframe maintenance checks that are more extensive in scope and duration than A/B checks and are generally performed at 15-to-24 month intervals. C checks in respect of our 747-200 aircraft (performed by third-party vendors) are generally more involved than those performed on our 747-400 aircraft, chiefly due to the differences in the fleet types, including the age of the aircraft and in the maintenance programs and procedures that are prescribed by the FAA. Our employees and contractors at our maintenance facility in Prestwick, Scotland perform C checks on many of our 747-400 aircraft. D checks are the heaviest and most extensive of all the airframe maintenance checks and are generally performed at the earlier of 25,000-to-28,000 flight hours or a five-to-ten year interval. D checks for both our 747-200 and 747-400 aircraft are outsourced to third party vendors.

          Our FAA-approved maintenance program allows our engines to be maintained on an “on condition” basis. Under this arrangement, engines are sent for overhaul based on life-limited parts and/or performance deterioration.

          We believe that a balance between “in-house” and fixed, firm-priced contracts provides the most efficient means of maintaining our aircraft fleet and the most reliable way to forecast our maintenance costs. A certain portion of our lower-level maintenance activities (primarily daily and “A” checks) are performed on a time and material basis.

Insurance

          The Company maintains insurance of the types and in amounts deemed adequate to protect itself and its property, consistent with current industry standards. Principal coverage includes: liability for injury to members of the public; damage to property of the Company and of others; loss of, or damage to, flight equipment, whether on the ground or in flight; fire and extended coverage; directors and officers insurance; fiduciary; and workers’ compensation and employer’s liability. In addition to customary deductibles, the Company self-insures for all or a portion of its losses from claims related to medical insurance for employees.

          Since September 11, 2001, the Company and other airlines have been unable to obtain coverage for claims resulting from acts of terrorism, war or similar events (war-risk coverage) at reasonable rates from the commer-

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cial insurance market. The Company has, as have most other U.S. airlines, therefore purchased its war-risk coverage through a special program administered by the federal government. The Emergency Wartime Supplemental Appropriations Act extended this insurance protection until August 2005. The Secretary of Transportation may extend this policy until December 31, 2005. If the federal insurance program terminates, the Company would likely face a material increase in the cost of war-risk coverage, and because of competitive pressures in the industry, the Company’s ability to pass this additional cost on to customers may be limited.

Governmental Regulation

          General. Atlas and Polar are subject to regulation by the DOT and the FAA, among other governmental agencies. The DOT primarily regulates economic issues affecting air service, such as certification, fitness and citizenship, competitive practices, insurance and consumer protection. The DOT has the authority to investigate and institute proceedings to enforce its economic regulations and may assess civil penalties, revoke operating authority or seek criminal sanctions. Atlas and Polar each hold DOT-issued certificates of public convenience and necessity plus exemption authority to engage in scheduled air transportation of property and mail, domestically and in enumerated international markets, and charter air transportation of property and mail on a worldwide basis. Atlas and Polar have determined that Atlas’ operating certificate will be consolidated into Polar’s. Atlas and Polar have commenced the process for obtaining the regulatory approvals required to consummate such consolidation. We expect this consolidation to occur in the first quarter of 2006, with the surviving air carrier henceforth doing business under both the Atlas and Polar brands.

          The DOT conducts periodic evaluations of each air carrier’s fitness and citizenship. In the area of fitness, the DOT seeks to ensure that the carrier has the managerial competence, compliance disposition and financial resources needed to conduct the operations for which it has been certificated. Additionally, each air carrier must remain a United States citizen, which requires that it be organized under the laws of the United States or a state, territory or possession thereof; that its president and at least two-thirds of its directors and other managing officers be United States citizens; that not more than 25% of its voting stock be owned or controlled, directly or indirectly, by foreign nationals; and that it not otherwise be subject to foreign control. The DOT broadly interprets “control” to exist when an individual or entity has the potential to exert substantial influence over airline decisions through affirmative action or the threatened withholding of consents and/or approvals.

          After an airline emerges from bankruptcy, the DOT normally re-examines that airline’s fitness and citizenship to ensure that it retains its “U.S. citizen” status and that it meets all relevant U.S. ownership and control rules and regulations. Late last year, following our emergence from Chapter 11, the DOT notified us that it would conduct such a re-examination of Atlas and Polar. We have assisted the DOT in its review and have responded promptly to several DOT information requests. We have not issued and will not issue any shares of our new common stock to holders of allowed general unsecured claims under the Plan of Reorganization pending completion of the DOT’s review. While we do not currently anticipate any problems with the DOT’s citizenship review, we cannot predict with any degree of certainty when such review will be complete.

          The FAA is the U.S. government agency with primary responsibility for regulation of flight operations and, in particular, matters affecting air safety, such as airworthiness requirements for aircraft, operating procedures, mandatory equipment and the licensing of pilots, mechanics and dispatchers. Each U.S. air carrier must hold a valid FAA-issued air carrier certificate and FAA-approved operations specifications authorizing operation in specific regions with specified equipment under specific conditions. We believe Atlas and Polar are in material compliance with applicable FAA rules and regulations and maintain all documentation required by the FAA.

          Like all U.S. air carriers, Atlas and Polar are subject to extensive FAA regulation and oversight. The FAA monitors compliance with maintenance, flight operations and safety regulations and performs frequent spot inspections of aircraft, employees and records. Also, the FAA has the authority to issue maintenance directives and other mandatory orders relating to, among other things, inspection of aircraft and engines, fire retardant and smoke detection devices, increased security precautions, collision and windshear avoidance systems, noise abatement and the mandatory removal and replacement of aircraft parts that have failed or may fail in the future. In addition, the FAA mandates certain record-keeping procedures. The FAA has the authority to modify, temporarily suspend or permanently revoke an air carrier’s authority to provide air transportation or that of its licensed personnel, after providing notice and a hearing, for failure to comply with FAA rules, regulations and directives. The

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FAA is empowered to assess civil penalties for such failures or institute proceedings for the imposition and collection of monetary fines for the violation of certain FAA regulations and directives. The FAA also is empowered to revoke an air carrier’s authority on an emergency basis, without providing notice and a hearing, where significant safety issues are involved.

          International. Air transportation in international markets (the vast majority of markets in which Atlas and Polar operate) are subject to extensive additional regulation. The ability of Atlas and Polar to operate to other countries is governed by aviation agreements between the United States and the respective countries or in the absence of such an agreement, by principles of comity and reciprocity. Sometimes, as in the case of Japan and China, aviation agreements restrict the number of carriers that may operate, their frequency of operation or the routes over which they may fly. This makes it necessary for the DOT to award route and operations rights to U.S. air carrier applicants through competitive route proceedings. International aviation agreements are periodically subject to renegotiation, and changes in U.S. or foreign governments could result in the alteration or termination of such agreements, diminish the value of existing route authorities or otherwise affect Atlas’ and Polar’s international operations. Foreign governmental authorities also impose substantial licensing and business registration requirements, and in some cases, require the advance filing and/or approval of schedules or rates. Moreover, the DOT and foreign government agencies typically regulate alliances and other commercial arrangements between U.S. and foreign air carriers, such as the ACMI arrangements that Atlas maintains from time to time. Approval of these agreements may be conditional, and approval during one time period does not guarantee approval in future periods. Nor is there a guarantee that an arrangement will be approved in the first instance.

          Airport Access. The ability of Atlas and Polar to operate is dependent on their ability to gain access to airports of their choice at commercially desirable times and on acceptable terms. In some cases this is constrained by the need for the assignment of takeoff and landing “slots” or comparable operational rights. Like other air carriers, Atlas and Polar are subject to such constraints at slot-restricted airports such as Chicago and a variety of foreign locations (e.g., Tokyo, Incheon and Amsterdam). The availability of slots is not assured and the inability of Atlas and Polar to obtain and retain needed slots could therefore inhibit their efforts to provide services in certain international markets. In addition, nighttime restrictions of certain airports could, if expanded, have an adverse operational impact.

          Security. Following the September 11 terrorist attacks, the aviation security functions previously performed by the FAA were transferred to the U.S. Transportation Security Administration (“TSA”). The TSA extensively regulates aviation security through rules, regulations and security directives. Currently, at the insistence of key Congressional leaders, the TSA is devoting significant resources and attention to the air cargo area. It is in the final stages of issuing a rule to establish uniform standards and impose requirements designed to prevent unauthorized access to freighter aircraft and the introduction of weapons to such aircraft. Atlas and Polar today operate pursuant to a TSA-approved security program that, we believe, maintains the security of all aircraft in the fleet. There can be no assurance, however, that we will remain free from onerous new TSA requirements. Additionally, foreign governments and regulatory bodies (such as the European Commission) impose their own aviation security requirements. The trend is toward a tightening of such requirements. This may have an adverse impact on our operations, especially to the extent the new requirements may necessitate redundant or costly measures or be in conflict with TSA requirements. Additionally, the U.S. Congress is considering legislation which, if enacted, could substantially increase the burden on air cargo carriers.

          Environmental. Atlas and Polar are subject to various federal, state and local laws relating to the protection of the environment, including the discharge or disposal of materials and chemicals and the regulation of aircraft noise, which are administered by numerous state and federal agencies. For instance, the DOT and the FAA have authority under the Aviation Safety and Noise Abatement Act of 1979, as amended and recodified, and under the Airport Noise and Capacity Act of 1990, to monitor and regulate aircraft engine noise. We believe all aircraft in the Atlas/Polar fleet materially comply with current DOT, FAA and international noise standards.

          Under the FAA’s Directives issued pursuant to its “Aging Aircraft” program, we are subject to extensive aircraft examinations and will be required to undertake structural modifications to our fleet from time to time to address the problems of corrosion and structural fatigue. As part of the FAA’s overall Aging Aircraft program, it has issued Directives requiring certain additional aircraft modifications to be accomplished. We estimate that the modification costs per aircraft will range between $2 million and $3 million. Fifteen aircraft in our fleet have

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already undergone the major portion of such modifications. The remaining aircraft in service will require modification prior to 2009. Other directives have been issued that require inspections and minor modifications to Boeing 747-200 aircraft. The newly manufactured Boeing 747-400 freighter aircraft were delivered in compliance with all existing FAA Directives at their respective delivery dates. It is possible, however, that additional Directives applicable to the types of aircraft or engines; included in our fleet could be issued in the future, and that the cost of complying with such Directives could be substantial.

          Atlas and Polar also are subject to the regulations of’ the Environmental Protection Agency (“EPA”) regarding air quality in the United States. All aircraft in the Atlas/Polar fleet meet or exceed applicable EPA fuel venting requirements and smoke emissions standards.

          Other Regulations. Air carriers are also subject to certain provisions of the Communications Act of 1934 because of their extensive use of radio and other communication facilities, and are required to obtain an aeronautical radio license from the Federal Communications Commission (“FCC”). Additionally, Atlas and Polar also are subject to international trade restrictions imposed by Presidential determination and the Office of Foreign Assets Control of the U.S. Department of Commerce. Atlas and Polar endeavor to comply with such requirements at all times. Our operations may become subject to additional federal requirements in the future under certain circumstances. We are also subject to state and local laws and regulations at locations where we operate and the regulations of various local authorities that operate the airports we serve. We believe Atlas and Polar are in material compliance with all of such currently applicable laws and regulations.

          Civil Reserve Air Fleet. Atlas and Polar both participate in the Civil Reserve Air Fleet (“CRAF”) Program which permits the U.S. Department of Defense to utilize their aircraft during national emergencies when the need for military airlift exceeds the capability of military aircraft. This Program could adversely restrict our commercial business in times of national emergency.

          Future Regulation. Congress, the DOT, the FAA and other governmental agencies are currently considering, and in the future may consider and adopt, new laws, regulations and policies regarding a wide variety of matters that could affect, directly or indirectly, the operations, ownership and profitability of Atlas and Polar. It is neither possible to predict what other matters might be considered in the future nor to judge what impact, if any, the implementation of any future proposals or changes might have on the Atlas and Polar businesses.

Competition

          A substantial majority of our ACMI business is conducted by Atlas. The market for outsourcing cargo ACMI services is highly competitive. We believe that the most important bases for competition in the ACMI business are the age of the aircraft fleet, the payload and cubic capacities of the aircraft, and the price, flexibility, quality and reliability of the air transportation services provided. We maintain a major share of the 747-400 ACMI market, where there are no significant direct competitors at present. Competition with respect to the 747-200 ACMI market, however, is more significant where our principal competitors include Air Atlanta, Icelandic, MK Airlines and Southern Air and Tradewinds. In keeping with our strategy of actively managing our asset base by selectively disposing of unproductive assets, we intend to reduce our 747-200 capacity over the next several years and to replace these older aircraft with newer, more modern aircraft. We believe that our ability to grow the ACMI business depends upon economic conditions, the level of commercial activity and our continuing ability to convince major international airlines that outsourcing some portion of their air cargo needs is more effective and efficient than undertaking cargo operations with their own incremental capacity and resources.

          Our Scheduled Service business is conducted through Polar. We offer fully dedicated freighter capacity to our freight-forwarder customers, transporting goods primarily on aircraft pallets. We compete for cargo volume principally with other all-cargo and combination carriers, including Cathay Pacific, Northwest, JAL, NCA, Korean, KLM, and Lufthansa, and with major passenger airlines that have substantial belly cargo capacity. The primary competitive factors in the Scheduled Service market are price, geographic coverage, flight frequency, reliability and capacity. We believe that we can compete effectively in the Scheduled Service business due to our position as a low-cost operator offering reliable flight schedules to key limited-entry markets (including China, Japan and intra-Asia).

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          We participate through our AMC Charter business segment in the CRAF Program under one-year contracts with the AMC, where we have made available a substantial number of our aircraft to be used by the U.S. military in support of their operations, and operate such flights pursuant to entitlement based, full-cost contracts. Airlines may participate in the CRAF Program either alone or through a teaming arrangement. At present, two teams have been formed. We participate in the CRAF Program through a teaming arrangement led by FedEx. A third team has been formed and is expected to participate in the CRAF Program beginning October 1, 2006. The formation of competing teaming arrangements, an increase by other air carriers in their commitment of aircraft to the CRAF Program, or the withdrawal of any of our current team members, could adversely affect the amount of AMC business awarded to us in the future. Depending upon market conditions existing at the time of any reduction in our current level of CRAF Program participation, we would deploy any surplus aircraft into one or more of our other business segments to obtain the highest available rate of return on these assets.

          The ad hoc charter market is highly competitive, with a number of operators, including Evergreen International, FedEx charters, Kalitta, Lufthansa Charter, and other passenger airlines providing competition. Our Commercial Charter business is our smallest business segment in terms of revenue. Many of our ad hoc charter flights are one-way return flights from Asia or Europe, positioned by one-way AMC flights that originate from the U.S. and terminate in Europe and the Middle East. Over the last two years, most of our ad hoc charter capacity has been allocated to the AMC charter business, and this allocation is expected to continue into the foreseeable future.

Fuel

          Aviation fuel is one of the most significant expenses for an airline. During the years ended December 31, 2004, 2003 and 2002 fuel costs represented 25.6%, 23.5% and 18.4%, respectively, of our total operating expenses. Fuel prices and availability are subject to wide price fluctuations based on geopolitical issues and supply and demand, which we can neither control nor accurately predict. The following table summarizes our fuel consumption and costs for the years ended December 31.

	2004		2003		2002
Gallons consumed (in thousands)		280,304		333,747		242,755
Average price per gallon, including tax	$	1.25	$	0.98	$	0.91
Cost (in thousands)	$	351,112	$	326,022	$	221,632

          Our exposure to fluctuations in fuel price exists only with regard to our Scheduled Service and Commercial Charter businesses, where we attempt to pass on price increases to customers through the imposition of a surcharge. ACMI contracts require our customers to pay for aviation fuel. We are not exposed to risk with respect to the AMC fuel expense as the price is set under the annual contract and we receive adjustments for price increases and reductions for price decreases.

          In the past, we have not experienced significant difficulties with respect to fuel availability. Although we currently do not anticipate a significant reduction in the availability of jet fuel, a number of factors make accurate predictions impossible, including geopolitical uncertainties in oil-producing nations and shortages in and disruptions to refining capacity. For example, hostilities and political turmoil in Iraq and other oil-producing nations could lead to disruptions in oil production and/or to substantially increased oil prices. The inability to obtain jet fuel at competitive prices would materially and adversely affect our results of operation and financial condition.

          Although we have not regularly entered into hedging arrangements in the past, we are currently reviewing various hedging strategies and may engage, on a going forward basis, in certain fuel hedging activities or fuel purchase commitments to help us manage the price and availability of fuel and limit our exposure to significant fluctuations.

Employees

          The airline business is labor intensive. Salaries, wages and benefits accounted for approximately 15.5% of our consolidated operating expenses for 2004. As of December 31, 2004, we had 1,962 employees, 1,056 of whom were air crewmembers. We maintain a comprehensive training program for our crewmembers in compliance with FAA requirements in which each pilot regularly attends recurrent training programs. Of our employees, approximately 641 Atlas employees and approximately 340 Polar employees are represented by the Airline Pilots

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Association (“ALPA”). Our relations with ALPA are governed by the Railway Labor Act. Under this statute, a collective bargaining agreement between a company and the labor union generally does not expire but becomes amendable as of a stated date. If either party wishes to modify the terms of such agreement, it must notify the other in the manner prescribed in the agreement.

          Polar’s collective bargaining agreement with ALPA became amendable in May 2003, and we cannot accurately predict the outcome of any current or future negotiations with ALPA. Since July 2003, negotiations have been under the direction of a mediator appointed by the National Mediation Board (the “NMB”). On May 20, 2005, in a letter to the NMB, ALPA requested a proffer of arbitration, the last step before the parties may be released into a 30 day cooling off period, which must take place before the parties can engage in self-help. The Company has responded to the NMB seeking a denial of ALPA’s request. Although we have never had a work interruption or stoppage and believe our relations with our Polar crewmembers are generally good, we are subject to risks of work interruption or stoppage and may incur additional administrative expenses associated with union representation of our employees. If we are unable to reach agreement with our Polar crewmembers on the terms of Polar’s collective bargaining agreement, we may be subject to work interruptions or stoppages, which, if sustained, could materially and adversely affect our financial condition, results of operations and liquidity.

          Atlas’ collective bargaining agreement with ALPA became effective on August 1, 2002. By letter dated May 6, 2005, ALPA filed a notice of desire to amend the current collective bargaining agreement between Atlas and ALPA pursuant to Section 6 of the Railway Labor Act. The current agreement becomes amendable on February 1, 2006. We are subject to risks of work interruption or stoppage and may incur additional administrative expenses associated with union representation of our employees. If we are unable to reach agreement with our Atlas crewmembers on the terms of Atlas’ collective bargaining agreement, or if Atlas were unable to negotiate future contracts with its crewmembers, we may be subject to work interruptions and stoppages, which, if sustained, could materially and adversely affect our financial condition, results of operations and liquidity.

          In November 2004, in order to increase efficiency and assist in controlling certain costs, we initiated steps to combine the ALPA represented bargaining units of Atlas and Polar, a process that is expected to be completed in 2006. Any such combination will be in accordance with the terms and conditions of Atlas’s and Polar’s collective bargaining agreements, which agreements provide for a seniority integration process and the negotiation of a single collective bargaining agreement.

Available Information

          All of our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and all amendments to those reports, filed with or furnished to the SEC, are available free of charge through our corporate Internet Website, www.atlasair.com, as soon as reasonably practicable after we have electronically filed such material with, or furnished it to, the SEC. Certain information concerning our restructuring and our filing under Chapter 11 of the Bankruptcy Code may be found at www.atlasreorg.com.

          The information on these Websites is not, and shall not be deemed to be, part of this Report or incorporated into any other filings we make with the SEC.

Risk Factors

          You should carefully consider each of the following risk factors and all other information in the Report. These risk factors are not the only ones facing us. Our operations could also be impaired by additional risks and uncertainties. If any of the following risks and uncertainties develop into actual events, our business, financial condition and results of operations could be materially and adversely affected.

Risks Related to Our Business

We are highly leveraged and our substantial debt and other obligations could limit our financial resources and ability to compete and may make us more vulnerable to adverse economic events.

          While we obtained significant relief as a result of our restructuring efforts, we remain highly leveraged and have substantial debt, lease and other obligations, which could have negative consequences, including:

• making it more difficult to pay principal and interest with respect to our debt;

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• requiring us to dedicate a substantial portion of our cash flow from operations for interest, principal and lease payments and reducing our ability to use our cash flow to fund working capital and other general corporate requirements;

• increasing our vulnerability to general adverse economic and industry conditions;

• limiting our flexibility in planning for, or reacting to, changes in business and our industry;

• placing us at a disadvantage to many of our competitors who have less debt; and

• exposing us to fluctuations in interest rates with respect to that portion of our debt, including our bank loans, which is at a variable rate of interest.

Our ability to service our debt and meet our other obligations depends on certain factors beyond our control.

          Our ability to service our debt and meet our lease and other obligations as they come due is dependent on our future financial and operating performance. This performance is subject to various factors, including factors beyond our control such as changes in global and regional economic conditions, changes in our industry, changes in interest or currency exchange rates, the price and availability of aviation fuel and other costs, including labor and insurance.

          If our cash flow and capital resources are insufficient to enable us to service our debt and leases and meet these obligations as they become due, we could be forced to:

• restructure or refinance our debt;

• obtain additional debt or equity financing;

• reduce or delay capital expenditures;

• limit or discontinue, temporarily or permanently, business plans or operations; or

• sell assets or businesses.

          We cannot assure you as to the timing of such actions or the amount of proceeds that could be realized from such actions. Accordingly, we cannot assure you that we will be able to meet our debt service and other obligations as they become due or otherwise.

We are subject to restrictive covenants under our debt instruments and aircraft lease agreements. These covenants could significantly affect the way in which we conduct our business. Our failure to comply with these covenants could lead to an acceleration of our debt and termination of our aircraft leases.

          Certain of our debt instruments and lease agreements contain a number of covenants that, among other things, significantly restrict our ability to:

• incur additional debt or issue new lease obligations above threshold amounts;

• invest in new capital assets above certain limitations;

• pay dividends or make other restricted payments;

• create or permit certain liens;

• sell assets; and

• consolidate or merge with or into other companies or sell all or substantially all of our assets.

          These restrictions could limit our ability to finance our future operations or capital needs, to make acquisitions or to pursue future business opportunities. In addition, our Revolving Credit Facility with Congress Financial Corporation (“Congress”) (the “Revolving Credit Facility”), a certain loan that was made to Atlas Freighter Leasing III, Inc. (“AFL III”) (the “AFL III Credit Facility”), another loan made to Atlas (the “Aircraft Credit Facility” or “ACF”), and certain leases require us to maintain specified financial ratios and/or satisfy certain financial covenants. We may be required to take action to reduce our debt or to act in a manner contrary to our business objectives to meet these ratios and to satisfy these covenants. Events beyond our control, including changes in the economic and business conditions in the markets in which we operate, may affect our ability to do

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so. While we are currently in compliance with these ratios and covenants, we cannot assure you that we will continue to meet these ratios or satisfy these covenants or that the lenders or lessors will waive any failure to do so. A breach of any of the covenants in, or our inability to maintain the required financial ratios under, our debt instruments, including the Revolving Credit Facility, and certain of our leases would prevent us from borrowing under the Revolving Credit Facility and could result in a default under it and the leases. Moreover, if the lenders under a facility or other agreement in default were to accelerate the debt outstanding under that facility, it could result in a cross default under other debt facilities or leases. If all or any part of our debt were to be accelerated, we may not have, or be able to obtain, sufficient funds to repay such debt. A default under the leases could result in a reversion to the original lease terms without regard to the restructuring of the lease payments and an acceleration of any amounts owed under the leases.

Our financial condition could suffer if we experience unanticipated costs as a result of the SEC investigation and other lawsuits and claims.

          On October 28, 2004, the SEC issued a Wells Notice to us indicating that the SEC staff is considering recommending to the SEC that it bring a civil action against us alleging that we violated certain financial reporting provisions of the federal securities laws from 1999 to 2002. In addition, the SEC has filed one or more proofs of claim in the Chapter 11 Cases. We are currently engaged in discussions with the SEC regarding the Wells Notice and the possible resolution of this matter, and continue to cooperate fully with the SEC in respect of its investigation. However, we cannot assure you as to the outcome of this investigation or that we will be able to resolve this matter on terms favorable to us.

          See Item 3 of Part I of the Report for information regarding other legal proceedings that could have a material adverse effect on our financial condition and results of operations. We are also party to a number of other claims, lawsuits and pending actions, which we consider to be routine and incidental to our business.

Volatility of aircraft values may affect our ability to obtain financing secured by our aircraft.

          We have historically relied upon the market value of our aircraft as a source of additional capital. The market for used aircraft, however, is volatile, and can be negatively affected by excess capacity due to factors such as a slow down in global economic conditions. As a result, the value of aircraft reflected on our consolidated balance sheet may not reflect the current fair market value or appraised value of these aircraft.

Our access to capital may be limited.

          Our operations are capital intensive. They are financed from operating cash flow, and if required from borrowings pursuant to the Revolving Credit Facility. Many airlines, including us, have defaulted on debt securities and bank loans in recent years and have had their equity eliminated in bankruptcy reorganizations. This history has led to limited access to the capital markets by companies in our industry. Our access to the capital markets may also be limited for the foreseeable future due to the lack of current SEC periodic reporting and limited liquidity in our securities. Restrictions on our ability to access capital and obtain sufficient financing to fund our operations may diminish our financial and operational flexibility, and could curtail our operations and adversely affect our ability to take advantage of opportunities for expansion of our business. We cannot assure you, however, that any additional replacement financing will be available on terms that are favorable or acceptable to us.

We have material weaknesses in our internal controls over financial reporting.

          In connection with our initial procedures to comply with Section 404 of the Sarbanes-Oxley Act of 2002, we have identified a substantial number of significant deficiencies and material weaknesses in our internal controls over financial reporting. We are committed to addressing these deficiencies and material weaknesses, which have required us to hire additional personnel and outside advisory services and have resulted and will continue to result over at least the next twelve months in additional accounting and legal expenses. If we are unsuccessful in our focused effort to permanently and effectively remediate these deficiencies and material weaknesses, or otherwise fail to maintain adequate internal controls over financial reporting, our ability to accurately and timely report our financial condition may be adversely impacted, which could, among other things, result in a default under our Revolving Credit Facility and limit our access to the capital markets. In addition, if we do not remediate these weaknesses, we will not be able to conclude, pursuant to Section 404 of Sarbanes-Oxley and Item 308 of Regulation S-K, that our internal controls over financial reporting are effective. We cannot assure you as to what

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conclusions our management or independent registered public accounting firm might reach with respect to the effectiveness of our internal controls over financial reporting at the compliance deadline. In the event of non-compliance, we may lose the trust of our customers, suppliers and security holders, and our stock price could be adversely impacted. For more information, see Controls and Procedures in Item 9A of Part II of the Report.

Labor disputes with union employees could result in a work interruption or stoppage, which could materially adversely impact our results of operations.

          All of our U.S. crewmembers are represented by unions. Collectively, these employees represent approximately 54% of our workforce as of December 31, 2004. Although we have never had a work interruption or stoppage, we are subject to risks of work interruption or stoppage and may incur additional expenses associated with the union representation of our employees. Moreover, we cannot assure you that disputes, including disputes with any certified collective bargaining representatives of our employees, will not arise in the future or will result in agreement on terms satisfactory to us. Such disputes and the inherent costs associated with their resolution could have a material adverse effect on our results of operations and financial condition.

          In November 2004, in order to increase efficiency and assist in controlling certain costs, we initiated preliminary steps to combine the U.S. crewmembers bargaining units of Atlas and Polar. These actions are in accordance with the terms and conditions of Atlas’ and Polar’s collective bargaining agreements, which agreements provide for a seniority integration process and the negotiation of a single collective bargaining agreement. In the event that we are unsuccessful in reaching agreement on a single collective bargaining agreement, any unresolved issues will be submitted to binding arbitration. While we cannot assure you as to the outcome of such arbitration, any decision by the arbitrator could materially impact our crew costs.

Our operating cash flows may be subject to fluctuations related to the seasonality of our business and our ability to promptly collect accounts receivable. A significant decline in operating cash flows may require us to seek additional financing sources to fund our working capital requirements.

          Our Scheduled Service and Commercial Charter operations are seasonal in nature, with peak activity occurring during the retail holiday season, which traditionally begins in September and lasts through mid-December. This typically results in a significant decline in demand for these services in the first quarter. As a result, our revenues typically decline in the first quarter of the calendar year as our minimum contractual aircraft utilization level temporarily decreases. Our ACMI contracts typically allow our customers to cancel a maximum of 5% of the guaranteed hours of aircraft utilization over the course of a year. Our customers often exercise such cancellation options early in the first quarter of the year, when the demand for air cargo capacity has been historically low following the seasonal holiday peak in the latter part of the fourth quarter.

          Historically, we have experienced fluctuations in our operating cash flows as the result of fluctuations in our collection of accounts receivable. These fluctuations have been due to various issues, including amendments and changes to existing contracts and the commencement of operations under new agreements. If we cannot successfully collect a significant portion of such accounts receivable over 90 days old, we may be required to set aside additional reserves or write off a portion of such receivables. If we are not able to maintain or reduce our aged receivables, our ability to borrow against the Revolving Credit Facility may be restricted because borrowings are limited to 85.0% of “eligible” domestic receivables, excluding receivables aged over 90 days old. If our operating cash flows significantly decline as a result of such fluctuations, we may be required to seek alternative financing sources, in addition to the Revolving Credit Facility, to fund our working capital requirements. We cannot assure you that we would be able to successfully obtain such alternative financing on terms favorable to us or at all.

We depend on continued business with certain customers in each of our business segments. If our business with any of these customers declines significantly, it could have a material adverse effect on our financial condition and results of operations.

          During 2004 and 2003, AMC accounted for approximately 20.0% and 31.1%, respectively, of our total operating revenues. We expect that revenues from AMC will continue to be a significant source of our revenue for the foreseeable future. However, our revenues from AMC are derived from one-year contracts that AMC is not obligated to renew. In addition, AMC can typically terminate or modify its contract with us for convenience, if we fail to perform, or if we fail to pass biannual inspections. Any such termination would result in a loss of revenue, could also expose us to significant liability and could hinder our ability to compete for future contracts with the

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federal government. If our AMC business declines significantly, it could have a material adverse effect on our results of operations and financial condition. Even if AMC continues to award business to us, we cannot assure you that we will continue to generate the same level of revenues we currently derive from our AMC Charter operations. The volume of AMC business is sensitive to changes in national and international political priorities and the U.S. federal budget.

          During 2004 and 2003, ACMI contracts accounted for approximately 26.6% and 22.1%, respectively, of our consolidated operating revenues. No ACMI customer accounted for 10% or more of our total operating revenues. Our significant ACMI customers included Emirates, Qantas, Air New Zealand, Cargolux, Korean Air, British Airways and Lan Chile. While we believe that our relationships with these and our other customers are mutually satisfactory, our failure to renew any of our contracts with them, or the renewal of any of those contracts on less favorable terms, could have a material adverse effect on our results of operations and financial condition.

A significant decline in our AMC business transporting cargo for delivery to military locations could have a material adverse effect on our results of operations and financial condition.

          During 2004 and 2003, approximately 20.0% and 31.1%, respectively, of our consolidated operating revenues were derived from AMC business, including expansion mission requests transporting cargo for delivery to military locations in Germany, Bahrain, Qatar and Kuwait or near Afghanistan, Iraq, and elsewhere in the Middle East. A material decline in such business, including one-way missions, could have a material adverse effect on our results of operations and financial condition.

Our revenues from AMC could decline as a result of the system AMC uses to allocate business to commercial airlines that participate in the Civil Reserve Air Fleet.

          Each year, AMC grants a certain portion of its business to different airlines based on a point system. The number of points an airline can accrue is determined by the amount and type of aircraft pledged to the CRAF Program. We participate in CRAF through a teaming arrangement with other airlines, led by FedEx. Our team is currently entitled to 43% of all widebody 747 U.S. military business. The formation of competing teaming arrangements, an increase by other air carriers in their commitment of aircraft to the program, or the withdrawal of our team’s current partners, especially FedEx, could adversely affect the amount of our AMC business in future years. In addition, if any of our team members were to cease or restructure their operations, the number of planes pledged to CRAF by our team could be reduced. As a result, the number of points allocated to our team could be reduced and our allocation of AMC business would likely decrease, resulting in a material adverse effect on our results of operations and financial condition.

Many of our arrangements with customers are not long-term contracts. As a result, we cannot assure you that we will be able to continue to generate similar revenues from these arrangements.

          We generate a large portion of our revenues from arrangements with customers with terms of less than one year, ad hoc arrangements or “call when needed” contracts. A large portion of our AMC revenues are from expansion business, which is not fixed by contract and is dependent on AMC requirements which cannot be predicted. The scheduled termination dates for ACMI contracts range from one month to 4.3 years as of December 31, 2004. While we believe that our relationships with these and our other customers are mutually satisfactory, we cannot assure you that our customers will continue to seek the same level of services from us as they have in the past or that they will renew these arrangements or not terminate them on short notice, if permitted. In the past, several of our larger contracts have not been renewed due to reasons unrelated to our performance, such as the financial position of our customers or their decision to move the services we previously provided to them in-house. Accordingly, we cannot assure you that in any given year we will be able to generate similar revenues from our customers as we did in the previous year.

As a U.S. government contractor, we are subject to a number of procurement and other rules and regulations.

          In order to do business with government agencies, we must comply with and are affected by many laws and regulations, including those relating to the formation, administration and performance of U.S. government contracts. These laws and regulations, among other things:

• require, in some cases, certification and disclosure of all cost and pricing data in connection with contract negotiations;

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• impose accounting rules that define allowable costs and otherwise govern our right to reimbursement under certain cost-based U.S. government contracts; and

• restrict the use and dissemination of information classified for national security purposes and the exportation of certain products and technical data.

These laws and regulations affect how we do business with our customers and, in some instances, impose added costs on our business. A violation of these laws and regulations could result in the imposition of fines and penalties or the termination of our contracts. In addition, the violation of certain other generally applicable laws and regulations could result in our suspension or debarment as a government contractor.

We depend on the availability of our wide-body aircraft for the majority of our flight revenues. The loss of one or more of these aircraft for any period of time could have a material adverse effect on our results of operations and financial condition.

          In the event that one or more of our Boeing 747 aircraft are out of service for an extended period of time, we may have difficulty fulfilling our obligations under one or more of our existing contracts. As a result, we may have to lease or purchase replacement aircraft or, if necessary, convert an aircraft from passenger to freighter configuration. We cannot assure you that suitable replacement aircraft could be located quickly or on acceptable terms. The loss of revenue resulting from any such business interruption or costs to replace aircraft could have a material adverse effect on our results of operations and financial condition.

          We do not have insurance against the loss arising from any business interruption. If we fail to keep our aircraft in service, we may have to take impairment charges in the future and our results of operations would be adversely affected. The loss of our aircraft or the grounding of our fleet could reduce our capacity utilization and revenues, require significant capital expenditures to replace such aircraft and could have a material adverse affect on us and our ability to make payments on the debt or lease related to the aircraft. Moreover, any aircraft accident could cause a public perception that some or all of our aircraft are less safe or reliable than other carriers’ aircraft, which could have a material adverse effect on our results of operations and financial condition.

We are subject to the risks of having a limited number of suppliers for our aircraft.

          Our current dependence on a single type of aircraft for all of our flights makes us particularly vulnerable to any problems associated with the Boeing 747-400 and Boeing 747-200 aircraft, including design defects, mechanical problems, and contractual performance by the manufacturer or in actions by the FAA resulting in an inability to operate our aircraft. Carriers that operate a more diversified fleet are better positioned than we are to manage such events.

Our fleet includes older aircraft which have higher maintenance costs than new aircraft and which could require substantial maintenance expenses.

          Our fleet includes 43 aircraft manufactured between 1970 and 2003. As of December 31, 2004, the average age of our B747-200 operating aircraft was approximately 25.2 years and the average age of our B747-400 operating aircraft was approximately 4.6 years. Because many aircraft components wear out and are required to be replaced after a specified number of flight hours or takeoff and landing cycles, and because older aircraft may need to be refitted with new aviation technology, older aircraft tend to have higher maintenance costs and lower available flight hours than newer aircraft. Maintenance and related costs can vary significantly from period to period as a result of government-mandated inspections and maintenance programs and the time needed to complete required maintenance checks. In addition, the age of our aircraft increases the likelihood that we will need significant capital expenditures in the future to replace our older aircraft. The incurrence of substantial additional maintenance expenses for our aircraft, or the incurrence of significant capital expenditures to replace our aircraft, could have a material adverse effect on our results of operations and financial condition.

Our business outside of the U.S. exposes us to uncertain conditions in overseas markets.

          A significant portion of our revenues comes from air-freight services to customers outside the U.S., which exposes us to significant risks, including the following:

• potential adverse changes in the diplomatic relations between foreign countries and the U.S.;

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• risks of insurrections or hostility from local populations directed at U.S. companies and their property;

• government policies against businesses owned by foreigners;

• expropriations of property by foreign governments;

• the instability of foreign governments or economies; and

• adverse effects of currency exchange controls.

In addition, at some foreign airports, we are required by local governmental authorities or market conditions to contract with third parties for ground and cargo handling and other services. The performance by these third parties or boycott of such services is beyond our control and any operating difficulties experienced by these third parties could adversely affect our reputation and/or business.

Volatility in international currency markets may adversely affect demand for our services.

          We provide services to numerous industries and customers that experience significant fluctuations in demand based on regional and global economic conditions and other factors beyond our control. The demand for our services could be materially adversely affected by downturns in the businesses of our customers. Although we price the majority of our services and receive the majority of our payments in U.S. dollars, many of our customers’ revenues are denominated in foreign currencies. Any significant devaluation in such currencies relative to the U.S. dollar could have a material adverse effect on such customers’ ability to pay us or on their level of demand for our services, which could have a material adverse effect on our results of operations and financial condition. Conversely, if there is a significant decline in the value of the U.S. dollar against foreign currencies, the demand for some of the products we transport could decline. Such a decline could reduce demand for our services and thereby have a material adverse effect on our results of operations; and financial condition.

The market for air cargo services is highly competitive. If we are unable to compete effectively, we may lose current customers, fail to attract new customers and experience a decline in our market share.

          Our industry is highly competitive and susceptible to price discounting due to periodic excess capacity. New freighter aircraft and passenger converted freighters will add to the supply of lift available to the market. Since we offer a broad range of aviation services, our competitors vary by geographic market and type of service. Each of the markets we serve is highly competitive, fragmented and, other than ground handling and logistics, can be capital intensive. In addition, air cargo companies are able to freely enter domestic markets. We believe that the most important elements for competition in the air cargo business are the range, payload and cubic capacities of the aircraft and the price, flexibility, quality and reliability of cargo transportation services. In addition, some of our contracts are awarded based on a competitive bidding process. Competition arises primarily from other international and domestic contract carriers, regional and national ground handling and logistics companies, internal cargo units of major airlines and third party cargo providers, some of which have substantially greater financial resources and more extensive fleets and facilities than we do. Some of our airline competitors are currently facing financial difficulties and as a result could resort to drastic pricing measures with which we may not be able to compete.

          Our ability to attract and retain business also is affected by whether, and to what extent, our customers decide to coordinate and service their own transportation needs. Some of our existing customers maintain transportation departments that could be expanded to manage freight transportation in-house. If we cannot successfully compete against companies providing services similar to, or that are substitutes for, our own or if our customers begin to provide for themselves the services we currently provide to them, our results of operations and financial condition, may be materially adversely affected.

          In addition, traffic rights to many foreign countries are subject to bilateral air services agreements between the U.S. and foreign countries and are allocated only to a limited number of U.S. carriers and are subject to approval by the applicable foreign regulators. Consequently, our ability to provide air cargo service in some foreign markets depends, in part, on the willingness of the DOT to allocate limited traffic rights to us rather than to competing U.S. airlines and on the approval of the applicable foreign regulators. If we are unable to compete successfully, we may not be able to generate sufficient revenues and cash flow to sustain or expand our operations.

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The success of our business depends on the services of certain key personnel.

          We believe that our success depends to a significant extent upon the services of Mr. Jeffrey H. Erickson, our President and Chief Executive Officer, and certain other key members of our senior management including those with primary responsibility for each business segment. We believe that our success in acquiring ACMI contracts, expanding our product line to include a broader array of products and services, providing Scheduled Service to international markets, and managing our operations will depend substantially upon the continued services of many of our present executive officers and our ability to attract and retain talented personnel in the future. The loss of the services of Mr. Erickson, or other key members of our management, could have a material adverse effect on our business.

We operate in dangerous locations and carry hazardous cargo, either of which could result in a loss of, or damage to, our aircraft.

          Our operations are subject to conditions that could result in losses of, or damage to, our aircraft, or death or injury to our personnel. These conditions include:

• geopolitical instability in areas through which our flight routes pass, including areas where the U.S. is conducting military activities;

• future terrorist attacks; and

• casualties incidental to the services we provide in support of U.S. military activities, particularly in or near Afghanistan, Iraq, Kuwait and elsewhere in the Middle East.

We regularly carry sensitive military cargo, including weaponry, ammunition and other volatile materials. The inherently dangerous nature of this cargo increases the risk of damage to or loss of our aircraft.

Our insurance coverage does not cover all risks.

          Our operations involve inherent risks that subject us to various forms of liability. We carry insurance against those risks for which we believe other participants in our industry commonly insure; however, we can give no assurance that we are adequately insured against all risks. If our liability exceeds the amounts of our coverage, we would be required to pay any such excess amounts, which amounts could be material to our business and operations.

Risks Relating to Our Industry

The cost of fuel is a major operating expense, and fuel shortages and price volatility could adversely affect our business and operations.

          Although the price of aviation fuel only impacts the Scheduled Service and Commercial Charter segments of our operations, to the extent that we are unable to recover increased costs through fuel surcharges to our customers, it is one of our most significant expenses. During 2004 and 2003, fuel costs were approximately 25.6% and 23.5%, respectively, of our total operating expenses. The price of aviation fuel is directly influenced by the price of crude oil and to a lesser extent by refining capacity relative to demand, which are influenced by a wide variety of macroeconomic and geopolitical events and is completely beyond our control. Additionally, hostilities in the Middle East and terrorist attacks in the U.S. and abroad could cause significant disruptions in the supply of crude oil and have had a significant impact on the price and availability of aviation fuel. We have not regularly entered into fuel hedging arrangements to date. If we elect to hedge fuel prices in the future, through the purchase of futures contracts or options or otherwise, there can be no assurance that we will be able to do so successfully.

          We generally attempt to pass on increases in the price of aviation fuel to our Scheduled Service customers through the imposition of a surcharge, but we bear a portion of price increases over the short term. There can be no assurance that we will be able to continue to impose such surcharges in the future. In addition, if fuel costs increase significantly, our customers may reduce the volume and frequency of cargo shipments or find less costly alternatives for cargo delivery, such as land and sea carriers.

          ACMI contracts require our customers to pay for aviation fuel. However, if the price of aviation fuel increases, our customers may reduce their use of aircraft subject to such ACMI contractual provisions or our ability to renew contracts thereby having an impact on our ACMI business. Accordingly, an increase in fuel costs

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could have a material adverse effect on our customers’ results of operations and financial condition. Similarly, a reduction in the availability of fuel, resulting from a disruption of oil imports or other events, could have a material adverse effect on our customers’ results of operations and financial condition, which, in turn, could significantly impact their ability and willingness to continue to do business with us.

We are subject to extensive governmental regulation and our failure to comply with these regulations in the U.S. and abroad, or the adoption of any new laws, policies or regulations or changes to such regulations may have an adverse effect on our business. Failure to utilize our economic rights in limited-entry markets also could result in a loss of such rights.

          Our operations are subject to complex aviation and transportation laws and regulations, including Title 49 of the U.S. Code (formerly the Federal Aviation Act of 1958, as amended), under which the DOT and the FAA exercise regulatory authority over air carriers such as Atlas and Polar. In addition, our activities fall within the jurisdiction of various other federal, states, local and foreign authorities, including the U.S. Department of Defense, the TSA, U.S. Customs and Border Protection, the Treasury Department’s Office of Foreign Assets Control and the Environmental Protection Agency. These laws and regulations may require us to maintain and comply with the terms of a wide variety of certificates, permits, licenses, noise abatement standards and other requirements, and our failure to do so could result in substantial fines or other sanctions. The DOT, the FAA, the TSA, and foreign aviation regulatory agencies have the authority to modify, amend, suspend or revoke the authority and licenses issued to us for failure to comply with provisions of law or applicable regulations, and may impose civil or criminal penalties for violations of applicable rules and regulations. Such actions, if taken, could have a material adverse effect on our mode of conducting business, results of operations and financial condition. In addition, governmental authorities such as the DOT, the TSA and the FAA may adopt new regulations, directives or orders that could require us to take additional and potentially costly compliance steps or result in the grounding of some of our aircraft, which could increase our costs or result in a loss of revenues, which could have a material adverse effect on our results of operations, financial condition. This is true, in particular, in the area of security.

          In response to the terrorist attacks of September 11, 2001, various government agencies, including U.S. Customs and Border Protection, the Food and Drug Administration and the TSA have adopted, and may in the future adopt, new rules, policies or regulations or changes in the interpretation or application of existing laws, rules, policies or regulations, compliance with which could increase our costs or result in loss of revenues, or have a material adverse effect on our results of operations and financial condition. The TSA has increased security requirements in response to September 11 and has recently proposed comprehensive new regulations governing air cargo transportation, including all-cargo services, in such areas as cargo screening and security clearances for individuals with access to cargo or who board and travel on all-cargo aircraft. These new regulations, and others that potentially might be adopted, could have an adverse impact on our ability to efficiently process cargo or could increase our costs. Furthermore, Congress is considering air transportation security provisions that could have similar impacts.

          A significant amount of our business is conducted in limited-entry international markets with U.S.-negotiated rights that have been awarded in competitive carrier selection proceedings. This includes Polar’s new China rights and its “5th-freedom” rights to serve Hong Kong third country markets. Because such rights typically are subject to loss for underutilization, there is a risk of constriction of our operating rights if it is determined that economic conditions preclude full use. The DOT and foreign government agencies may also consider or adopt new laws, regulations and policies with respect to limited-entry markets (such as China and Japan). Any adverse change or modification to our limited-entry market rights (or governmental trade barriers in such markets) could negatively affect our profitability.

Our insurance coverage has become increasingly expensive and difficult to obtain.

          Aviation insurance premiums historically have fluctuated based on factors that include the loss history of the industry in general and the insured carrier in particular. Since September 11, 2001, our premiums have increased significantly. Future terrorist attacks involving aircraft, or the threat of such attacks, could result in further increases in insurance costs, and could affect the price and availability of such coverage.

          Although we believe our current insurance coverage is adequate and consistent with current industry practice, there can be no assurance that we will be able to maintain our existing coverage on terms favorable to us, that the premiums for such coverage will not increase substantially or that we will not bear substantial losses and

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lost revenues from accidents. Substantial claims resulting from an accident in excess of related insurance coverage or a significant increase in our current insurance expense could have a material adverse effect on our results of operations and financial condition.

Risks Related to Ownership of Our Common Stock

Equity based awards will dilute the ownership interests of other stockholders.

          We have adopted a long-term incentive plan for our directors, officers, key management employees and certain other employees providing for the issuance of up to 12.175% of New Common Stock. A management incentive plan authorizes the issuance of up to 10% of the New Common Stock to participants through a combination of restricted stock, stock options and other equity-based awards. As of December 31, 2004, we have awarded 610,600 shares of restricted stock and granted options to acquire an additional 526,700 shares of New Common Stock under this management incentive plan as required pursuant to the Plan of Reorganization. In addition, we have adopted an employee stock option plan for our other employees, which authorizes the issuance of up to 2.175% of the New Common Stock to participants through stock option grants. As of December 31, 2004, we have granted options to acquire 299,963 share of New Common Stock under the employee stock option plan. The balance of available restricted stock and stock options under these plans (totaling approximately 1.2 million shares) will be reserved for future new hires, performance awards or other awards to be determined in the discretion of Holdings’ Board of Directors. If these stock options are exercised, additional grants of options to acquire additional New Common Stock are made or additional restricted stock is awarded, the ownership percentage of the other holders of New Common Stock will be diluted.

The market price of our New Common Stock could be negatively affected upon the issuance of a substantial portion of the remaining shares of New Common Stock to be issued pursuant to the Plan of Reorganization.

          The Plan of Reorganization contemplates the issuance of 17,202,666 shares, exclusive of stock grants to our employees and directors, of New Common Stock to holders of allowed general unsecured claims of Atlas, AAWW, Acquisitions and Logistics on a pro rata basis in the same proportion that each holder’s allowed claim bears to the total amount of all allowed claims. None of such shares have yet been issued. The issuance of all or a substantial portion of such shares may cause the market price of our common stock to decline. If the market price of our New Common Stock declined significantly, it could, among other things, also result in an impairment in our ability to access the capital markets should we desire or need to raise additional capital.

We cannot assure you that an active trading market will develop or continue for the New Common Stock and we cannot predict with certainty when we will file our periodic reports on a timely basis.

          The New Common Stock is currently quoted on the Pink Sheets and, as a result, there is limited liquidity therein. There can be no assurance that an active market for any of the New Common Stock will develop or continue, and no assurance can be given as to the prices at which it might be traded. Moreover, there can be no assurance that we will be successful in any attempt to have the New Common Stock listed on a national securities exchange or a foreign securities exchange, or quoted on the NASDAQ Stock Market.

          At the present time we have not filed, on a timely basis, our required reports on Forms 10-K and 10-Q. While we are working to improve the timeliness of our filings, we cannot predict with certainty when this will occur.

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ITEM 2. PROPERTIES

Aircraft

          Owned and leased aircraft operated by the Company at December 31, 2004 include the following:

	Owned		Capital Leased		Operating Leased		Total		Average Age Years
747-100		1		—		—		1		34.0
747-200		17		3		1		21		25.2
747-300		1		—				1		19.1
747-400		6		—		14		20		4.6
Total		25		3		15		43		15.7

          Lease expirations for the operating leased aircraft included in the preceding table of operating flight equipment range from October, 2010 to February, 2025. Three of the aircraft are dry leased to a 49% owned affiliate.

Ground Facilities

          Our principal offices are located at 2000 Westchester Avenue, Purchase, New York, where we lease 140,000 square feet under a long-term lease that expires in 2012. Polar leases 6,878 square feet of office space in Long Beach, California, pursuant to a lease that is set to expire in July 2009. These offices include both operational and administrative support functions, including flight and crew operations, maintenance and engineering, material management, human resources, legal, sales and marketing, financial, accounting and information technology.

          In addition, Atlas leases warehouse space at Miami International Airport on a month-to-month basis. The leased warehouse space is used to store aviation equipment and aircraft components employed to maintain aircraft operated by us. Atlas also maintains 40,000 square feet of warehouse space at JFK Airport in New York, New York. Polar rents 170,000 square feet in Prestwick, Scotland under a long-term lease that expires in July 2010 for its maintenance activities. Atlas also leases 40,000 square feet at the Amsterdam Airport for maintenance and storage purposes.

ITEM 3. LEGAL PROCEEDINGS

Bankruptcy Cases

          In re: Atlas Air Worldwide Holdings, Inc., Atlas Air, Inc., Polar Air Cargo, Inc., Airline Acquisition Corp. I and Atlas Worldwide Aviation Logistics, Inc.

          As discussed above in Part I, Item 1, on the Bankruptcy Petition Date, AAWW, Atlas, Polar and two other wholly owned subsidiaries filed voluntary bankruptcy petitions for reorganization under Chapter 11 of the Bankruptcy Code. The Chapter 11 Cases were jointly administered under the caption “In re Atlas Air Worldwide Holdings, Inc., Atlas Air, Inc., Polar Air Cargo, Inc. Airline Acquisition Corp. I, and Atlas Worldwide Aviation Logistics, Inc., Case No. 04-10792.” As of the Bankruptcy Petition Date, virtually all pending litigation (including most of the actions described below) were stayed, and absent further order of the Bankruptcy Court, no party, subject to certain exceptions, was able to take any action to recover on pre-petition claims against the Debtors. Pursuant to a global settlement that resolved differences between the Polar and Atlas Creditors’ Committees and the Debtors regarding the Company’s initial Plan of Reorganization filed on April 19, 2004, all litigation between the parties named above was abated pending final documentation of the settlement terms and submission of a revised disclosure statement and the Plan of Reorganization. The requisite creditors having voted in favor of the plan, on July 16, 2004, the Bankruptcy Court entered the Order Confirming the Final Modified Second Amended Joint Plan of Reorganization of the Debtors, and the Company emerged from the Chapter 11 Cases on the Effective Date.

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Shareholder Litigation

     Shareholder Derivative Actions

          On October 25, 2002 and November 12, 2002, shareholders of AAWW filed two separate derivative actions on behalf of AAWW against various former officers and former members of the Company’s Board of Directors in the Supreme Court of New York, Westchester County. Both derivative actions charged, among other things, that members of the Board of Directors violated: (1) their fiduciary duties of loyalty and good faith, (2) the United States generally accepted accounting principles (“GAAP”), and (3) the Company’s Audit Committee Charter by failing to implement and maintain an adequate internal accounting control system. Furthermore, the actions allege that a certain named former director breached her fiduciary duties of loyalty and good faith by using material non-public information to sell shares of the Company’s common stock at artificially inflated prices. On February 3, 2004, AAWW provided notice of its January 30, 2004 bankruptcy filing to the court hearing the consolidated derivative action. Because these derivative actions were property of the Company’s estate at the time of filing bankruptcy, all proceedings were stayed during the Chapter 11 Cases. Under the Plan of Reorganization, AAWW became the holder of these claims and will decide whether to pursue some or all of the derivative claims against former officers and directors.

     Securities Class Action Complaints

          Seven putative class action complaints have been filed against AAWW and several of its former officers and former directors in the United States District Court for the Southern District of New York. The seven class actions were filed on behalf of purchasers of the Company’s publicly traded common stock during the period from April 18, 2000 through October 15, 2002. These class actions alleged, among other things, that during the time period asserted, AAWW and the individual defendants knowingly issued materially false and misleading statements to the market in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The class actions included claims under the Securities Act of 1933 on behalf of purchasers of common stock issued by AAWW in a September 2000 secondary public offering pursuant to, or traceable to, a prospectus supplement dated September 14, 2000 and filed with the SEC on September 18, 2000 (the “September Secondary Offering”). The complaints sought unspecified compensatory damages and other relief. On May 19, 2003, these seven class actions were consolidated into one proceeding. A lead plaintiff and a lead counsel were appointed by that court.

          Plaintiffs filed a single consolidated amended class action complaint in August 2003 and a second consolidated amended class action complaint in October 2003. The second consolidated amended class action complaint supersedes and replaces all prior complaints, and alleges: (i) violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 against AAWW and six of its former officers or directors on behalf of all persons who purchased or otherwise acquired the common stock of AAWW between April 18, 2000 and October 15, 2002, inclusive, and (ii) violation of Sections 11 and 15 of the Securities Act of 1933 against AAWW, four of its former officers or directors and Morgan Stanley Dean Witter on behalf of all persons who purchased or otherwise acquired Atlas common stock issued in the September Secondary Offering. Each defendant moved to dismiss the second consolidated amended class action complaint on or about December 17, 2003. On February 3, 2004, AAWW notified the court hearing the consolidated action of the Company’s January 30, 2004 bankruptcy filing staying the litigation against AAWW.

          Since confirmation of the Plan of Reorganization, the Bankruptcy Court has entered an order subordinating claims arising from these class action proceedings to general unsecured claims. The Plan of Reorganization provides that subordinated claims receive no distribution.

SEC Investigation

          On October 17, 2002, the SEC commenced an investigation arising out of the Company’s October 16, 2002 announcement that it would restate its 2000 and 2001 financial statements. In October 2002, the Company’s board of directors appointed a special committee which in turn retained the law firm of Skadden, Arps, Slate, Meagher and Flom, LLP for the purpose of performing an internal review concerning the restatement issues and assisting AAWW in its cooperation with the SEC investigation. A Formal Order of Investigation was subsequently issued authorizing the SEC to take evidence in connection with its investigation. The SEC has served

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several subpoenas on AAWW requiring the production of documents and witness testimony, and the Company has been fully cooperating with the SEC throughout the investigation.

          On October 28, 2004, the SEC issued a Wells Notice to AAWW indicating that the SEC staff is considering recommending to the SEC that it bring a civil action against AAWW alleging that it violated certain financial reporting provisions of the federal securities laws from 1999 to 2002. In addition, the SEC has filed one or more proofs of claim in the Chapter 11 Cases. Any recovery on these claims will be in the form of stock distributions to unsecured creditors. AAWW is currently engaging in discussions with the SEC regarding the Wells Notice and the possible resolution of this matter, and will continue to cooperate fully with the SEC in respect of its investigation.

          On July 22, 2004, the Company and certain former officers and directors commenced an adversary proceeding in the Bankruptcy Court against Genesis Insurance Company, which was the Company’s directors’ and officers’ insurance carrier until October 2002. The complaint filed in that action addresses various coverage disputes between Genesis and the plaintiffs with respect to the SEC investigation and the class action shareholder litigation described above. While the case remains pending, the parties are engaged in mediation in an attempt to settle this matter.

Other Litigation

          On August 7, 2001, Atlas sued Southern Air, Inc. and Hernan Galindo in Miami-Dade County Circuit Court seeking damages in excess of $13.0 million. Atlas’ complaint alleged, among other things, that the defendants engaged in unfair competition and conspiracy, and committed tortious interference with Atlas contracts and/ or business relationships with Aerofloral, Inc. Atlas subsequently filed a second amended complaint joining additional defendants James K. Neff, Randall P. Fiorenza, Jay Holdings LLC, and EFF Holdings LLC, on the same legal theories asserted in the original complaint. On November 15, 2002, Southern Air, Inc. filed a bankruptcy petition for relief under Chapter 11 of the Bankruptcy Code, and thus, the lawsuit has been stayed against Southern Air, Inc. The Miami-Dade County Circuit Court, however, denied the other defendants’ motions to dismiss, and all have answered the second amended complaint denying any liability to Atlas. Southern Air, Inc. also filed a counterclaim against Atlas and a third party complaint against AAWW. The counterclaim and third party complaint alleged, among other things, that Atlas and AAWW are alter egos of each other and committed various torts against Southern Air, Inc., including tortious interference with contract and with advantageous business relationships, unfair competition, conspiracy, and other anti-competitive acts in violation of Florida law. The trial court granted AAWW’s motion to dismiss (without prejudice), for lack of personal jurisdiction over AAWW, and also granted Atlas’ motion to dismiss (without prejudice), for failure to state a cause of action. Southern has not, at this time, filed an amended counterclaim or an amended third party claim. Southern has emerged from bankruptcy and reorganized. Should the reorganized Southern file a counterclaim against Atlas which is not dismissed, Atlas may proceed against Southern in this litigation and seek to set-off any recovery Atlas obtains against Southern against any recovery that may be obtained by Southern against Atlas. In addition, Atlas has filed a third party amended complaint joining the law firm of Greenberg & Traurig, PA and three of its shareholders (the “GT Defendants”) as additional defendants. These claims include tortious interference, aiding and abetting tortious interference, conspiracy, fraud and other related claims. The GT Defendants have moved to dismiss Atlas’ Third Amended Complaint, as have the other defendants. Atlas is in the process of preparing opposition memoranda with respect to all of the Defendants’ Motions to Dismiss, which are set for hearing in late July or August 2005.

          On October 27, 2004, a lawsuit was brought in the United States District Court for the District of Alaska by a group of Atlas crewmembers alleging that they have been wrongfully taxed by the Company relative to their gateway transportation benefits. The complaint sought injunctive relief from further tax withholdings on the cost of gateway transportation, recovery of unauthorized withholdings from wages, and other unspecified damages. The Company filed a motion to dismiss on the grounds that the Court has no jurisdiction to hear this matter. Since the confirmation of the Company’s Plan of Reorganization and the emergence from bankruptcy, the portion of the complaint seeking monetary damages was dismissed, leaving only plaintiffs’ claim for injunctive relief. New motions seeking dismissal of the matter were recently granted, and this case has been dismissed, subject to plaintiffs’ rights to appeal.

          To complement its existing Benelux trademark registration and obtain broader geographic protection, Atlas, in late 2003, filed an application to register its name and logo with the European Union (“EU”). The application

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was processed internally and recently opposed by Atlas Transport GmbH, a German-based surface transportation company that has an EU trademark registration dating back to 1997. Atlas Transport has also advised the Company that it may seek a preliminary injunction against the Company’s continued use of the Atlas name in the EU. The Company has filed a protective letter with the German courts, asserting its prior and continuing use of the Atlas name on flights to and from Germany.

          ALPA filed a labor grievance against Polar challenging the permissibility under the Polar-ALPA collective bargaining agreement of certain wet lease flying performed by Atlas on behalf of Polar. This matter was presented to an arbitrator in February 2004 before the Polar Air Cargo, Inc. Crewmembers’ System Board of Adjustment (“SBA”). A preliminary decision was issued by the arbitrator denying ALPA’s grievance. ALPA requested an executive session of the SBA to challenge the arbitrator’s preliminary decision. A final decision was issued by the arbitrator on June 5, 2004, denying the grievance and this matter is now closed.

          There were contested matters and legal proceedings between the Company and the Polar Creditors’ Committee in the Chapter 11 Cases. By stipulation approved by the Bankruptcy Court, the Debtors assigned to the Polar Creditors’ Committee and the Atlas Committee the authority to pursue all actions necessary to the resolution of all inter-company claims. The Debtors’ Schedules of Assets and Liabilities, as amended, listed claims asserted by Atlas against Polar of approximately $188 million and claims asserted by Polar against Atlas of approximately $52 million. On May 7, 2004, the Polar Creditors’ Committee filed its Objection to Claim and Complaint for Avoidance and Recovery of Preferential Transfer, Avoidance and Recovery of Fraudulent Transfers and Obligations, Equitable Subordination of Claim, and Re-characterization of Claim (collectively the “Polar Committee Claim Objection”). The validity and allowance of the inter-company claims and the Polar Committee Claim Objection were rendered moot by the global settlement reached among the Debtors, the Atlas Committee and the Polar Creditors’ Committee, and approved by the Bankruptcy Court. In accordance with the global settlement, the Plan of Reorganization eliminated all inter-company claims among the Debtors; however, certain lenders and lessors alleged that some inter-company claims asserted by Atlas against Polar were excluded from the global settlement’s release. The Debtors settled these inter-company claims asserted by East Trust Sub 12 (an affiliate of GATX, “East Trust”) and Goldman Sachs Credit Partners L.P. (successor in interest to Bank One Leasing, “GSCP”), by inter alia, granting East Trust a claim against Polar of $1,250,000, and by liquidating GSCP’s claim against Polar at zero.

          In addition to the proofs of claim filed by the IRS as described in Note 3 to the Consolidated Financials Statements included in Item 8 of Part II of this Report, incident to administering the Company’s bankruptcy estates, the Company is currently reconciling the proofs of claim filed in the bankruptcy cases. As part of this reconciliation process, the Company has objected to a multitude of claims, which will result in litigation between the Company and the various claimants that will be resolved by the Bankruptcy Court. A number of these claims, if resolved against the Company, could require significant cash payments or could require the Company to fund additional cash into the trust established for Polar’s creditors. Except for the IRS claims, described in Note 3 to Consolidated Financial Statements included in Item 8 of Part II of this Report, the Company does not believe that any one of these claims, if resolved against the Company, will, individually, have a material adverse effect on the Company’s business.

Total Claims

          As of May 19, 2005, the Company had reviewed over 3,000 scheduled and filed claims aggregating approximately $7.5 billion, with a maximum of $850.8 million of claims that could potentially be allowed. Approximately $657.9 million of claims have been allowed to date, including $12.4 of cure claims and $1.0 million of other secured and priority claims. Claims of $192.9 million remain unresolved, including $116.0 million of unresolved IRS claims discussed below; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process.

Atlas Unsecured Claims

          Pursuant to the Plan of Reorganization, the Company will make a pro rata distribution of 17,202,666 shares of New Common Stock to holders of allowed general unsecured claims against Holdings, Atlas, Acquisition and Logistics. General unsecured claims of approximately $2.6 billion were filed against these entities. As of May 19, 2005, claims of $604.6 million have been allowed, claims of $60.4 million remain disputed, and the balance of

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claims have been withdrawn or disallowed; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process.

Polar Unsecured Claims

          Pursuant to the Plan of Reorganization, the Company will pay cash equal to sixty cents on the dollar for allowed unsecured claims against Polar. General unsecured claims of approximately $408.4 million were filed against Polar. As of May 19, 2005, claims of $39.9 million have been allowed, claims of $16.5 million remain disputed, and the balance of claims have been withdrawn or disallowed; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process. The Company estimates the additional allowed claims against Polar will ultimately be under $1 million.

Other Contingencies

          The Company has certain other contingencies resulting from litigation and claims incident to the ordinary course of business. Management believes that the ultimate disposition of these contingencies, with the exception of those noted above, is not expected to materially affect the Company’s results of operations financial condition and liquidity.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

          No matters were submitted to a vote of security holders by the Company during the quarter ending December 31, 2004.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

          On September 9, 2003, the Company received notification from the New York Stock Exchange (the“Exchange”) that trading in the Company’s common stock under the symbol CGO would be suspended immediately and that application would be made to the SEC to de-list the common shares. This application was approved by the SEC as of November 28, 2003, and the common stock was removed from listing and registration on the Exchange. Following the de-listing, our shares of common stock issued and outstanding prior to July 27, 2004 (“Old Common Stock”) had traded on the over counter market (“OTC”) on the Pink Sheets under the symbol AAWHQ.

          On July 27, 2004, (the effective date of our emergence from Chapter 11 bankruptcy) all then outstanding shares of Old Common Stock were cancelled and extinguished in accordance with the Plan of Reorganization. Holders of Old Common Stock received no distributions or other consideration. On or about July 28, 2004, our shares of common stock (“New Common Stock”) commenced trading on the OTC on a “when issued” basis under the symbol “AAWWV.PK.” As of December 31, 2004, excluding any grants or other awards under our long term incentive plan, there were approximately 3.0 million shares of our New Common Stock issued and outstanding and held by approximately 34 holders of record. On June 1, 2005, excluding any grants or other awards under our long term incentive plan, there were approximately 3.0 million shares of our New Common Stock issued and outstanding and held by approximately 37 stockholders of record of New Common Stock.

Market Price of Common Stock

          The following table sets forth the high and low sales prices per share of our common stock, which traded under the predecessor symbols of CGO and AAWHQ and which currently trades under the successor symbol of AAWWV.PK.

	High		Low
Successor
2005 Quarter Ended
June 30 (through June 15)	$	35.50	$	24.00
March 31	$	32.50	$	26.25
2004 Quarter Ended
December 31	$	24.00	$	19.30
September 30	$	19.00	$	14.00
Predecessor
June 30	$	0.26	$	0.02
March 31	$	0.50	$	0.20
2003 Quarter Ended
December 31	$	0.92	$	0.40
September 30	$	1.46	$	0.54
June 30	$	2.65	$	0.59
March 31	$	1.68	$	0.56

          We have never paid a dividend with respect to our New Common Stock, nor do we expect to pay a dividend in the foreseeable future. Moreover, we have covenants in many of our debt instruments that prohibit the payment of any cash dividends. See Note 10 to the Consolidated Financial Statements included in Item 8 of Part II of this Report for additional information on dividend restrictions.

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Description of AAWH New Common Stock

          We are authorized by our Certificate of Incorporation to issue 50.0 million shares of New Common Stock with a par value of $0.01 per share. Pursuant to the Plan of Reorganization, approximately 20 million shares are authorized for issuance, of which approximately 3.0 million have been issued to date. The remaining shares of New Common Stock will be issued to holders of allowed Atlas general unsecured claims under the Plan of Reorganization upon allowance of such claims per Order of the Bankruptcy Court.

          The Plan of Reorganization contemplates the distribution of 17,202,666 shares, exclusive of stock grants to our employees, and directors of New Common Stock to holders of allowed general unsecured claims of Atlas, AAWW, Acquisitions and Logistics on a pro rata basis in the same proportion that each holder’s allowed claim bears to the total amount of all allowed claims. The exact number of shares that each claimholder ultimately receives is dependent on the final total of allowed unsecured claims, and other factors such as unclaimed distributions and fractional share interests.

          In accordance with the Plan of Reorganization, on the Effective Date, AAWW issued and distributed 740,000 shares of New Common Stock to GE Capital Aviation Services, Inc. (“GECAS”) and 320,000 shares of New Common Stock to certain bank lenders under the Aircraft Credit Facility (see “Aircraft Credit Facility” in Item 7 of Part II of the Report). Additionally, pursuant to the terms of the Plan of Reorganization 1,737,334 shares of the New Common Stock were offered for subscription to certain unsecured creditors of Atlas, AAWW, Acquisition and Logistics. New Common Stock will not be distributed to holders of Polar allowed general unsecured claims since each such holder will instead receive a fixed cash recovery equal to 60.0% of the amount of their respective allowed claim.

          Excluding the long-term incentive plan and the shares issued to DVB Bank discussed below, as of June 1, 2005 and including the initial distribution described in the preceding paragraph, the Company has 2,797,334 shares issued, or about 15.0 % of the approximately 20,000,000 shares to be issued under the Plan of Reorganization. See Note 3, “Equity Distribution” in the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Report.

          The proposed allocation of such New Common Stock under the Plan of Reorganization is illustrated in the chart below:

Party	Equity Ownership %			Shares
ACF/AFL III		1.6	%		320,000
GECAS		3.7	%		740,000
General Unsecured Claims		86.0	%		17,202,666
Shares sold under Subscription		8.7	%		1,737,334
Total		100	%		20,000,000

          In addition to the above-referenced shares of New Common Stock allocated and to be allocated pursuant to the Plan of Reorganization, as of December 31, 2004, pursuant to the Plan of Reorganization of an aggregate of 2,772,559 shares of New Common Stock have been reserved for equity-based awards, of which 610,600 shares of restricted stock and options to purchase 826,663 shares, have been issued to directors, management and employees under a management incentive plan and the employee stock option plan.

          In addition, on August 26, 2004, the Bankruptcy Court entered an order approving the issuance of 200,000 shares of New Common Stock to DVB Bank, AG (“DVB”) as part of a settlement involving the restructuring of the lease of aircraft tail number N409MC. (See Note 10 to the Consolidated Financial Statements included in Item 8 of Part II of this Report). These shares were not part of the original 20,000,000 shares of New Common Stock allocated in the Plan of Reorganization discussed above.

          Distributions of shares of New Common Stock to holders of allowed Senior Note Claims under the Plan of Reorganization (relating to Atlas’ 10.75% Notes due 2005, 9.375% Notes due 2006, and 9.25% Notes due 2008) will be made to the indenture trustee, which will transmit the shares to the appropriate claimholders in accordance with the Plan of Reorganization and the respective indentures. Distributions to holders of other allowed general unsecured claims will be made directly to such claimholders in accordance with the Plan of Reorganization.

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Foreign Ownership Restrictions

          Under federal law and the DOT regulations, we must be controlled by United States citizens. In this regard, our president and at least two-thirds of our board of directors must be United States citizens and not more than 25% of our outstanding voting common stock may be held by non-U.S. citizens. We believe that during the period covered by this Report we were in compliance with these requirements.

ITEM 6. SELECTED FINANCIAL DATA

          The selected balance sheet data as of December 31, 2004 (Successor) and December 31, 2003 (Predecessor) and the selected statement of operations data for the period July 28, 2004 through December 31, 2004 (Successor) and the period January 1, 2004 through July 27, 2004 and each of the years in the two year period ended December 31, 2003 (Predecessor) have been derived from our audited financial statements included elsewhere herein. The selected balance sheet data as of December 31, 2002 (Predecessor) have been derived from our audited financial statements not included herein. Except for per share data, all other amounts are in thousands.

          The information provided below with respect to aircraft rent, depreciation and interest expense for periods after July 27, 2004, were affected materially by several factors which did not affect such items for comparable periods during the first seven months of 2004 and all of 2003. In conjunction with our emergence from bankruptcy, we applied the provisions of fresh-start accounting effective as of July 27, 2004, at which time a new reporting entity was deemed to be created.

          Fresh-start accounting required us to revalue our assets and liabilities to estimated fair values at July 27, 2004 in a manner similar to that which would occur if we were to apply purchase accounting. Significant adjustments included a downward revaluation of our owned aircraft fleet and the recording of additional intangible assets (principally related to Atlas’ ACMI customer contracts). In addition, fair-value adjustments were recorded in respect to our debt and lease agreements.

	Successor		Predecessor
	For the Period July 28, 2004 Through December 31, 2004		For the Period January 1, 2004 Through July 27, 2004		For the Year Ended December 31, 2003			For the Year Ended December 31, 2002
Total Operating Revenues	$	679,294	$	735,367	$	1,383,651		$	1,178,095
Income (loss) before cumulative effect of accounting change	$	22,710	$	28,246	$	(100,990	)	$	(98,369	)
Cumulative effect of accounting change		—		—		—			44,556
Net income (loss)	$	22,710	$	28,246	$	(100,990	)	$	(53,813	)
Basic Earnings (Loss) Per Share:
Income (loss) before cumulative effect of accounting change	$	1.12	$	0.74	$	(2.63	)	$	(2.57	)
Cumulative effect of accounting change		—		—		—			1.16
Net income (loss)	$	1.12	$	0.74	$	(2.63	)	$	(1.41	)
Weighted average common shares outstanding during the period		20,210		38,378		38,360			38,210
Diluted income (loss) per share:
Income (loss) before cumulative effect of accounting change	$	1.11	$	0.74	$	(2.63	)	$	(2.57	)
Cumulative effect of accounting change		—		—		—			1.16
Net income (loss)	$	1.11	$	0.74	$	(2.63	)	$	(1.41	)
Weighted average common shares and equivalents outstanding during the period		20,405		38,378		38,360			38,210
Total Assets	$	1,142,196			$	1,400,607		$	1,530,839
Long-term Debt (Less Current Portion)	$	602,985			$	—	*	$	—	*
Shareholders’ Equity (Deficit)	$	277,962			$	(28,282	)	$	71,483
Shareholders’ Equity (Deficit) per Common Share	$	13.62			$	(0.74	)	$	1.87
Cash Dividends Declared per Common Share	$	—			$	—		$	—

* For the years ended 2003 and 2002, long term debt of $909.1 million and $812.0 million were reclassifed to current liabilities as a result of our defaults on our debt.

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

          The following discussion relates to AAWW and its wholly owned subsidiaries, including Atlas and Polar. In this Report, references to “we,” “our” and “us” are references to AAWW and its subsidiaries, as applicable.

Reorganization

          The sustained weakness of both the United States and international economies that began in early 2001 and continued through the beginning of 2004, coupled with the lingering impact of the September 11, 2001 terrorist attacks, had a substantial negative impact on both international trade demand, and the airline industry in particular, including the ACMI and air cargo Scheduled Service markets that are vital to our results of operation and financial condition. Due to the negative impact on our financial condition and as part of a comprehensive financial restructuring of our aircraft debt and lease obligations, among other things, we defaulted on our covenants and payment obligations under all of our debt and lease arrangements. As a result, all debt outstanding had been reclassified as a current liability at December 31, 2003.

          In January 2003, we commenced our financial restructuring through negotiations with the lenders under the Aircraft Credit Facility and the AFL III Credit Facility (see description of the Company’s debt obligations, below) regarding impending principal payments and covenant defaults, as well as the suspension of lease payments on six Boeing 747-200 aircraft. In addition, we negotiated with certain other aircraft lessors to reduce or defer operating lease payments.

          In March 2003, we implemented a moratorium on substantially all of our aircraft debt and lease payments to provide time to negotiate restructured agreements with our significant creditors and lessors. Subsequent to the implementation of this moratorium, we made payments on certain debt and lease obligations pursuant to forbearance agreements or otherwise. However, the continuation of the moratorium beyond what was permitted in the forbearance agreements resulted in additional events of default with respect to substantially all of our debt and lease agreements. These defaults allowed the parties to these arrangements to exercise certain rights and remedies, including the right to demand immediate payment of such obligations in full and the right to repossess certain assets, including all of our owned and leased aircraft.

          In order to formalize our restructuring efforts, in March 2003 we embarked on a comprehensive operational and financial restructuring program that included the following key elements: (i) reorganizing the management team and management functions; (ii) enhancing profitability through operational restructuring initiatives, and (iii) reducing fixed financial costs through the restructuring of aircraft-related debt and lease obligations.

          Through the course of 2003, management refocused the commercial strategies of our key business segments, implemented operational cost saving initiatives and, with the assistance of our financial and legal advisors, negotiated with our secured aircraft creditors to reduce the rents and payments on our aircraft.

          On January 30, 2004, AAWW, Atlas, Polar, Airline Acquisition Corp I “Acquisition” and Atlas Worldwide Aviation Logistics, Inc. (“Logistics”, and together with AAWW, Atlas, Polar and Acquisition, the “Debtors”), each filed voluntary bankruptcy petitions for relief under Chapter 11 of title 11 of the United States Code, 11 U.S.C. §§ 101 et seq., in the United States Bankruptcy Court for the Southern District of Florida. The Bankruptcy Court jointly administered these cases as “In re Atlas Air Worldwide Holdings, Inc., Atlas Air, Inc., Polar Air Cargo, Inc., Airline Acquisition Corp I, and Atlas Worldwide Aviation Logistics, Inc., Case No. 04-10792”. During the course of the proceedings, the Debtors operated their respective businesses and managed their respective properties and assets as debtors-in-possession under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure and applicable court orders. The Bankruptcy Court entered an order confirming the Final Modified Second Amended Joint Plan of Reorganization of the Debtors dated July 14, 2004 and the Debtors emerged from bankruptcy on July 27, 2004. The Consolidated Financial Statements include data for all of our subsidiaries, including those that did not file for relief under Chapter 11, as those subsidiaries will be revalued under fresh-start accounting.

          On February 10, 2004, the United States Trustee for the Southern District of Florida appointed two official committees of unsecured creditors (together, the “Creditors’ Committees”), one each for Atlas and Polar. The Creditors’ Committees and their respective legal representatives had a right to be heard on all matters that came

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before the Bankruptcy Court concerning the Debtors’ reorganization. Pursuant to a global settlement between the Creditors’ Committees and the Debtors, all litigation between the Creditors’ Committees was abated pending final documentation of the settlement terms and submission of a revised Disclosure Statement and Plan of Reorganization. By virtue of the global settlement, the Creditors’ Committees supported confirmation of the Plan of Reorganization. On June 8, 2004, the Debtors’ original Disclosure Statement was approved by the Bankruptcy Court, thereby allowing the Debtors to solicit votes to accept the Plan of Reorganization. The Bankruptcy Court entered an order confirming the Plan of Reorganization, which became effective when the Company emerged from bankruptcy on the Effective Date.

Total Claims

          As of May 19, 2005, the Company had reviewed over 3,000 scheduled and filed claims aggregating approximately $7.5 billion, with a maximum of $850.8 million of claims that could potentially be allowed. Approximately $657.9 million of claims have been allowed to date, including $12.4 of cure claims and $1.0 million of other secured and priority claims. Claims of $192.9 million remain unresolved, including $116.0 million of unresolved IRS claims discussed below; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process.

Atlas Unsecured Claims

          Pursuant to the Plan of Reorganization, the Company will make a pro rata distribution of 17,202,666 shares of New Common Stock to holders of allowed general unsecured claims against Holdings, Atlas, Acquisition and Logistics. General unsecured claims of approximately $2.6 billion were filed against these entities. As of May 19, 2005, claims of $604.6 million have been allowed, claims of $60.4 million remain disputed, and the balance of claims have been withdrawn or disallowed; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process.

Polar Unsecured Claims

          Pursuant to the Plan of Reorganization, the Company will pay cash equal to sixty cents on the dollar for allowed unsecured claims against Polar. General unsecured claims of approximately $408.4 million were filed against Polar. As of May 19, 2005, claims of $39.9 million have been allowed, claims of $16.5 million remain disputed, and the balance of claims have been withdrawn or disallowed; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process. The Company estimates the additional allowed claims against Polar will ultimately be under $1 million.

          Pursuant to the Plan of Reorganization, the incumbent holders of outstanding equity of AAWW are to receive no distributions.

Certain Terms

          The following terms represent industry-related items and statistics specific to the airline and cargo industry sectors. They are used by management for statistical analysis purposes to better evaluate and measure operating levels, results, productivity and efficiency.

Glossary

ATM	Available Ton Miles represent the maximum available tons (capacity) per actual miles flown. It is calculated by multiplying the available capacity (tonnage) of the aircraft against the miles flown by the aircraft.
Block Hours	The time interval between when an aircraft departs the terminal until it arrives at the destination terminal.
RATM	Revenue per Available Ton Mile represents the average revenue received per available ton mile flown. It is calculated by dividing operating revenues by ATMs.
Revenue Per Block Hour	Calculated by dividing operating revenues by Block Hours.

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RTM	Revenue Ton Mile, calculated by multiplying actual revenue tons carried against miles flown.
Load Factor	The average amount of weight flown per the maximum available capacity. It is calculated by dividing RTMs by ATMs.
Yield	The average amount a customer pays to fly one ton of cargo one mile. It is calculated by dividing operating revenues by RTMs.
A/B Checks	Low level maintenance checks performed on aircraft at an interval of approximately 400 to 1,100 flight hours.
C Checks	High level or “heavy” airframe maintenance checks which are more intensive in scope than an A/B Check and are generally performed on a 15 to 24 month interval.
D Checks	High level or “heavy” airframe maintenance checks which are the most intensive in scope and are generally performed on an interval of 5 to 10 years or 25,000 to 28,000 flight hours, whichever comes first.

Business Overview

          Our principal business is the airport-to-airport transportation of heavy freight cargo. We have four primary lines of business, each constituting its own reportable segment. These segments are (i) ACMI or wet lease contracts, (ii) Scheduled Service, (iii) AMC Charters for the U.S. Military and (iv) Commercial Charter. In addition, we occasionally “dry lease” aircraft to other airlines. We do not consider dry leasing to be a core segment of our business.

          In our ACMI contract business, customers receive an aircraft which is crewed, maintained and insured by us in exchange for an agreed level of operation over a defined period of time. We are paid a defined hourly rate for the time the aircraft is operated or a minimum contractual rate when hour activity falls below minimum guaranteed levels. All other direct operating expenses, such as aviation fuel, landing fees and ground handling costs, are absorbed by the customer, who also bears the commercial risk of load factor and yield. Our ACMI contracts typically have terms ranging from several months to five years. At December 31, 2004 the terms of our existing contract maturities profile ranged from 1 month to 4.3 years. Average length of remaining ACMI contracts was 22.1 months as of December 31, 2004. We measure the performance of our ACMI contract business in terms of revenue per Block Hour and Fully Allocated Contribution (“Fully Allocated Contribution” or “FAC”) defined as pre-tax income (loss), excluding pre-petition and post emergence costs and related professional fees, unallocated corporate and other, and reorganization items. FAC is also used to analyze the profitability and contribution to net income or loss of our other business segments.

          We operate our Scheduled Services business primarily through Polar. We operate airport-to-airport specific routes on a specific schedule and customers pay to have their freight carried on that route and schedule. Our Scheduled all-cargo network serves four principal economic regions: North America, South America, Asia and Europe. We offer access to Japan through route and operating rights at Tokyo’s Narita Airport, and, as of December 2, 2004, to the People’s Republic of China through route and operating rights at Shanghai’s Pudong Airport. As of December 31, 2004, our Scheduled Services operation provides approximately 18 daily departures to 14 different cities in eight countries across four continents. Our Scheduled Service business is designed to provide:

• prime time arrivals and departures on key days of consolidation for freight forwarders and shippers; and

• connection or through-service between economic regions to achieve higher overall unit revenues.

          Our Scheduled Service business creates both load and yield risk. We measure performance of our Scheduled Service business in terms of RATM and FAC.

          Our AMC Charter business continues to be a profitable but unpredictable line of business. AMC Charter revenues are driven by the rate per flown mile. The AMC Charter rate is set by the U.S. Government each October, based on an audit of all AMC carriers and an assumed fuel price. Block Hours are difficult to predict and are sub-

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ject to certain minimum levels set by the U.S. Government. We bear the direct operating costs of AMC flights, however, the price of fuel consumed in AMC operations is fixed at the annual agreed upon rate.

          Our Commercial Charter business provides full-planeload airfreight capacity on one or multiple flights to freight forwarders, airlines and other air cargo customers. The revenue associated with our Commercial Charter business is contracted in advance of the flight, and, as with Scheduled Service, we bear the direct operating costs (except as otherwise agreed in the charter contracts).

          Our AMC and Commercial Charter businesses complement our ACMI contract and Scheduled Service businesses by:

• increasing aircraft utilization during slow seasons;

• positioning flights for Scheduled Service operations in directionally weak markets;

• enabling the performance of extra flights to respond to peak season Scheduled Service demand; and

• diversifying revenue streams.

          We measure performance of our AMC and Commercial Charter businesses in terms of revenue per Block Hour and FAC.

          The most significant trends that are evident when comparing our operations for the year ended 2004 to 2003 are:

• improved performance in our Scheduled Service and ACMI contract businesses, due primarily to improvement in Scheduled Service revenue, a reduction in overhead costs per Block Hour and the elimination of non-productive or “parked” aircraft; and

• the material reduction in AMC Block Hour activity resulting from the continued reduction in the high AMC demand that existed in 2003, which was partially offset by higher ACMI contracts and Scheduled Service Block Hour activity.

          Overall, Block Hours decreased 3.0% for 2004 compared to 2003. Specifically, Block Hours increased 20.2% for ACMI contracts, increased 1.6% for Scheduled Service, decreased 36.0% for AMC charters and decreased 37.5% for Commercial Charters for the year ended 2004 compared with the same period in 2003. The reduction in total Block Hour activity was due, in part, to a 16.2% reduction in our operating fleet, from an average of 45.0 aircraft for 2003 to 37.7 aircraft in 2004. The reduction in the fleet is associated with the rejection of aircraft through bankruptcy, which had the effect of reducing our fleet of Boeing 747 aircraft from 52 aircraft pre-bankruptcy to 43 aircraft as of December 31, 2004.

          Average aircraft is calculated by factoring in the time that aircraft were parked before being returned to active status.

          The improvement in profitability from year to year is a function of a general improvement in the demand for our cargo services, the elimination of the costs associated with the burden of non-operating, or “parked,” aircraft, the restructuring of our debt and lease agreements and the elimination of non-profitable flying in the Scheduled Service and ACMI contract business segments.

Outlook

          Our primary focus is to maintain a safe and efficient operation, streamline operations, restore and sustain profitability and rebuild stockholder value. We are undertaking a number of significant strategic measures designed to achieve these objectives. These measures include the following:

• optimizing our Scheduled Service network so that this business segment can ultimately attain profitability;

• continuing our efforts to reduce our overhead and operating costs;

• improving our operating procedures in several key facets of flight operations, ground operations and maintenance;

• selectively disposing of unproductive assets, which may include aging aircraft;

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• pursuing growth opportunities, which may include forming strategic alliances with synergistic carriers offering customers new services and fleet types, and entry into passenger ACMI business

• continuing our efforts to maximize our financial flexibility, which may include refinancing certain indebtedness and issuing new debt and/or equity securities.

          While we still face a number of significant challenges, a number of which are beyond our control (see “Risk Factors” in Item 1 of Part I of this Report), we believe that implementing these and other strategic measures will enable us to become one of the world’s most efficient, capable and diversified operator of long-haul freighter aircraft.

          Our focus is to optimize the allocation of assets between our four lines of business to maximize profitability and minimize risk. One of the significant challenges that we face is the cost of aviation fuel in the Scheduled Service business. During 2004, the average price per gallon for aviation fuel was 125 cents, an increase of 27.6% over the average price of 98 cents per gallon during 2003. Generally, we expect no more than 60% of the price-related increase in Scheduled Service fuel expense will be recovered through aircraft fuel surcharges (recorded as revenue). In response to the impact of increased aircraft fuel prices in the Scheduled Service business and to the increased opportunities for entering into profitable ACMI contracts, we expect to continue to optimize capacity allocations between the least profitable Scheduled Service markets and new ACMI opportunities.

          In addition to the impact of aviation fuel prices, another significant change to our Scheduled Service business in 2004 is the commencement of operations in China under the route authority granted to us on October 18, 2004 by the DOT. As a result, we were designated as the fourth U.S. freighter operator under the U.S.-China bilateral air services agreement and were awarded a total of nine weekly frequencies (six for use in 2004 and an additional three commencing March 25, 2005). On March 25, 2005, the DOT granted three additional weekly flights commencing in March 2006, which will increase the total weekly flights to twelve. We anticipate that China will improve the profitability of our Scheduled Service business as a whole.

          We expect the ACMI contract business, particularly the ACMI contract opportunities for 747-400 aircraft, to continue to strengthen into 2005, with demand for widebody freighter capacity exceeding supply over the near term.

          While we expect that the demand for AMC Charter business will be strong in 2005, total AMC Block Hour activity for 2004 was 36.0% lower than 2003. The 2003 activity was a function of the commencement of U.S. military operations in and around Iraq. Block Hour activity has declined and is expected to continue to decline in conjunction with the reduction in military-related activity in the Middle East.

          We expect our Commercial charter business to provide incremental utilization for our aircraft fleet and to make a positive pre-tax contribution in 2005.

Results of Operations

          The following discussion should be read in conjunction with the Consolidated Financial Statements and the Notes thereto included in Item 8 of Part II of this report.

Years Ended December 31, 2004 and 2003

          The discussion below provides comparative information on our historical consolidated results of operations. The information provided below with respect to aircraft rent, depreciation and interest expense for periods after July 27, 2004, were materially affected by several factors which did not affect such items for comparable periods during the first seven months of 2004 and all of 2003. In conjunction with our emergence from bankruptcy, we applied the provisions of fresh-start accounting effective as of July 27, 2004, at which time a new reporting entity was deemed to be created.

          Fresh-start accounting requires us to revalue our assets and liabilities to estimated fair values at July 27, 2004 in a manner similar to that which would occur if we were to apply purchase accounting. Significant adjustments included a downward revaluation of our owned aircraft fleet and the recording of additional intangible assets (principally related to Atlas’ ACMI customer contracts). In addition, fair-value adjustments were recorded in respect to our debt and lease agreements.

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          Notwithstanding the lack of comparability, we have prepared the following analysis to facilitate the year-on-year discussion of operating results. The analysis below is not prepared in accordance with GAAP and, as noted, results after July 27, 2004 are not on the same basis as results prior to that date (in millions).

	Successor		Predecessor					Predecessor
	For the Period July 28, 2004 Through December 31, 2004		For the Period January 1, 2004 Through July 27, 2004			Combined Results For the Year Ended December 31, 2004		Results For the Year Ended December 31, 2003
Operating Revenues
Scheduled Service	$	296.8	$	343.6		$	640.4	$	524.0
ACMI contracts		182.3		194.3			376.6		305.5
AMC charter		126.2		156.3			282.5		430.3
Charter service		53.3		15.8			69.1		86.6
Other revenue		20.7		25.4			46.1		37.3
Total operating revenues		679.3		735.4			1,414.7		1,383.7
Operating expenses
Aircraft fuel		176.0		175.1			351.1		326.0
Salaries, wages & benefits		91.5		120.6			212.1		194.4
Maintenance, materials and repairs		102.7		133.3			236.0		197.6
Aircraft rent		60.2		81.9			142.1		183.3
Ground handling		40.8		53.6			94.4		86.6
Landing fees and other rent		38.0		53.0			91.0		92.0
Depreciation and amortization		25.5		33.5			59.0		60.1
Travel		25.7		29.5			55.2		59.2
Pre-petition and post-emergence costs and related professional fees		4.1		11.5			15.6		44.4
Other		47.8		66.1			113.9		146.0
Total operating expenses		612.3		758.1			1,370.4		1,389.6
Operating income (loss)	$	67.0	$	(22.7	)	$	44.3	$	(5.9	)

Consolidated Results

          Total operating revenue. Our total operating revenues were $1,414.7 million for 2004, compared with $1,383.7 million for 2003, an increase of $31.0 million, or 2.2%. This increase was primarily due to higher Scheduled Service revenue, which was $640.4 million for 2004, compared with $524.0 million for 2003, an increase of $116.4 million or 22.2%. ACMI contracted revenue was $376.6 million for 2004, compared with $305.5 million for 2003, an increase of $71.1 million, or 23.3%. These increases were partially offset by reductions in revenue from our AMC business, which had revenue of $282.5 million for 2004, compared with $430.3 million for 2003, a decrease of $147.8 million, or 34.3%. Commercial charter revenue was $69.1 million for 2004, compared with $86.6 million for 2003, a decrease of $17.5 million, or 20.2%. Other revenue was $46.1 million for 2004, compared with $37.3 million for 2003, an increase of $8.8 million, or 23.6%.

          Scheduled Service revenue. Scheduled Service revenues were $640.4 million for 2004, compared with $524.0 million for 2003, an increase of $116.4 million, or 22.2%, primarily due to higher yields and higher load factors, offset by lower capacity. RTMs in the Scheduled Service segment were 2,022 million on a total capacity of 3,223 million ATMs in 2004, compared with RTMs of 1,844 million on a total capacity of 3,253 million ATMs in 2003. Load factor was 62.7% with a yield of $0.316 in 2004, compared with a load factor of 56.7% and a yield of $0.284 in 2003. RATM in our Scheduled Service segment was $0.198 in 2004, compared with $0.161 in 2003, representing an improvement of 23.0%. The material increase in the revenue performance of the Scheduled Service segment, as measured by RATM, was attributable to the positive impact of the scheduled network restructuring that was accomplished in the fourth quarter of 2003 and the first quarter of 2004, a general increase in the demand for air cargo services in 2004, an increase in fuel surcharge revenue in 2004, and specific improvement in load factor for flights from the U.S. to Asia and Europe, caused, in part, by the weakening of the US dollar against foreign currencies.

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          ACMI Contract revenue. ACMI contracted revenues were $376.6 million for 2004, compared with $305.5 million for 2003, an increase of $71.1 million, or 23.3%, due to both an increase in rate and volume. ACMI Block Hours were 70,343 for 2004, compared with 58,536 for 2003, an increase of 11,807, or 20.2%. Revenue per Block Hour was $5,355 for 2004, compared with $5,219 for 2003, an increase of $136 per Block Hour, or 2.6%. Total aircraft supporting ACMI contracts, excluding aircraft dry leased to our joint venture, as of December 31, 2004 were seven 747-200 aircraft and 11 747-400 aircraft, compared with December 31, 2003 when we had six 747-200 aircraft and five 747-400 aircraft supporting ACMI contracts.

          AMC Charter revenue. AMC Charter revenues were $282.5 million for 2004, compared with $430.3 million for 2003, a decrease of $147.8 million, or 34.3%, primarily due to a lower volume of AMC Charter flights which was partially offset by higher AMC rates. AMC Charter Block Hours were 22,376 for 2004, compared with 34,959 for 2003, a decrease of 12,583, or 36.0%. Revenue per Block Hour was $12,626 for 2004, compared with $12,308 for 2003, an increase of $317 per Block Hour, or 2.6%. The reduction in AMC Charter activity was primarily due to the continued reduction from the high AMC demand that existed in 2003 related to the build-up to the military conflict in Iraq.

          Commercial Charter revenue. Commercial Charter revenues were $69.1 million for 2004, compared with $86.6 million for 2003, a decrease of $17.5 million, or 20.2%, primarily as a result of a lower volume of commercial charter flights which was partially offset by an increase in rates. Commercial Charter Block Hours were 4,973 for 2004, compared with 7,956 for 2003, a decrease of 2,983, or 37.5%. Revenue per Block Hour was $13,903 for 2004, compared with $10,884 for 2003, an increase of $3,019 per Block Hour, or 27.7%. The improvement in the demand for air cargo in 2004 contributed to higher rates, but the lack of available capacity due to the increased flying in the ACMI contract business, and reduction in our aircraft fleet size through bankruptcy, caused a reduction in Commercial Charter revenue for 2004, compared with 2003.

          Salaries, wages and benefits expense. Salaries, wages and benefits were $212.1 million for 2004, compared with $194.4 million for 2003, an increase of $17.7 million, or 9.1%. Salaries, wages and benefits for air crew and ground employees increased by $5.8 million and $11.9 million, during 2004, compared with 2003, respectively. The increase was primarily due to contractual pay rate increases for air crew members and higher worker’s compensation coverage necessary for crewmember employees operating AMC charters and the increase in ground employee cost corresponds to the decrease in third party contract expense as more functions in maintenance and ground handling were taken in house.

          Maintenance materials and repairs. Maintenance, materials and repairs was $236.0 million for 2004, compared with $197.6 million for 2003, an increase of $38.4 million, or 19.4%. The increase in maintenance expense was primarily the result of an increase in engine overhaul expense and an increase in expense for D checks. There were six additional D check airframe maintenance events in 2004, compared with 2003.

          Aircraft fuel expense. Aircraft fuel expense was $351.1 million for 2004, compared with $326.0 million for 2003, an increase of $25.1 million, or 7.7%, as a result of increased fuel prices. Average fuel price per gallon was 125 cents for 2004, compared with 98 cents for 2003, an increase of 27 cents or 27.6%, partially offset by a 53.4 million gallon, or 16.0% decrease in fuel consumption to 280.3 million gallons for 2004 from 333.7 million gallons during 2003. The decrease in fuel consumption is the result of a 16,515 reduction in non-ACMI Block Hours from 100,152 in 2003 to 83,637 in 2004.

          Ground handling and airport fees. Ground handling and airport fees were $94.4 million for 2004, compared with $86.6 million for 2003, an increase of $7.8 million, or 9.0%. The increase is primarily attributable to increased Scheduled Service flight activity in Europe, which resulted in an increase in expense related to truck transportation purchased from outside vendors.

          Landing fees and other rent. Landing fees and other rent was $91.0 million for 2004, compared with $92.0 million for 2003, a decrease of $1.0 million, or 1.1%. The decrease is primarily related to the decrease in total non-ACMI operations.

          Pre-petition and post emergence costs and related professional fees. Pre-petition and post emergence costs were $15.6 million for 2004 compared to $44.4 million in 2003, a decrease of $28.8 million, or 64.9%. Expenses incurred during the Chapter 11 cases are classified as reorganization items net. We incurred expenses of $4.1 million in the period July 28, 2004 through December 31, 2004 related to the winding down of the bankruptcy proceedings.

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          Other operating expense. Other operating expenses were $113.9 million for 2004, compared with $146.0 million for 2003, a decrease of $32.0 million, or 21.9%, due primarily to a $11.6 million decrease in bad debt expense, a $6.0 million decrease in commissions due to reduced AMC and Scheduled Service related commission expense, and a $8.8 million decrease in third party contractor costs.

          Reorganization items, net. Reorganization items net were income of $112.5 million for the period January 31, 2004 through July 27, 2004, comprised of the following (in thousands):

Legal and professional fees	$	44,209
Rejection of CF6-80 PBH engine agreement		(59,552	)
Claims related to rejection of owned and leased aircraft		126,649
Other		7,782
Fresh-start adjustments		173,598
Gain on cancellation of pre-petition debt		(405,199	)
Total	$	(112,513	)

          The costs included in reorganization items reflect the cash and non-cash expenses recognized by us in connection with our reorganization and are separately reported as required by SOP 90-7. See Item 7 of Part II and Notes 3 and 4 to the Consolidated Financial Statements included in Item 8 of Part II of this Report.

Segments

          As discussed above, the application of fresh-start accounting following our emergence from bankruptcy, which among other things, reduced rent expense, reduced depreciation expense and increased amortization expense due to recognition of additional intangible assets, results in the incompatibility of the calculation of segment operating income and loss with prior periods. Therefore segment discussion is not presented for the 2004 versus the 2003 period.

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Years Ended December 31, 2003 and 2002

          The following table sets forth our consolidated statements of operations for the years ended December 31 (in millions)

	2003			2002
Operating Revenues
Scheduled Service	$	524.0		$	348.2
ACMI contracts		305.5			358.1
AMC charter		430.3			231.4
Charter service		86.6			145.2
Other revenue		37.3			95.2
Total operating revenues		1,383.7			1,178.1
Operating expenses
Aircraft rent		183.3			213.3
Salaries, wages & benefits		194.4			188.5
Maintenance, materials and repairs		197.6			202.4
Aircraft fuel		326.0			221.6
Ground handling		86.6			66.5
Landing fees and other rent		92.0			63.2
Depreciation and amortization		60.1			54.4
Travel		59.2			53.0
Pre-petition and post-emergence costs and related professional fees		44.4			—
Other		145.9			139.3
Total operating expenses	$	1,389.6		$	1,202.2
Operating loss		(5.9	)		(24.2	)
Non-operating Expenses (income)
Interest income		(3.7	)		(10.3	)
Interest expense		97.3			82.8
Other, net		1.5			1.7
Total non-operating expenses		95.1			74.2
Loss before income taxes		(101.0	)		(98.4	)
Income tax expense		—			—
Loss before cumulative effect of accounting change		(101.0	)		(98.4	)
Cumulative effect of accounting change		—			44.6
Net loss	$	(101.0	)	$	(53.8	)

Consolidated Results for 2003 and 2002

          Total operating revenue. Our total operating revenues were $1,383.7 million for 2003, compared with $1,178.1 million for 2002, an increase of $205.6 million, or 17.5%. This increase in our total operating revenue was primarily due to an increase in AMC charter revenues, which were $430.3 million for 2003, compared with $231.4 million for 2002, an increase of $198.9 million, or 86.0%. Scheduled Service revenue also increased and totaled $524.0 million for 2003, compared with $348.2 million for 2002, an increase of $175.8 million, or 50.5%. These increases were partially offset by decreases in Commercial Charter revenue, which was $86.6 million for 2003, compared with $145.2 million for 2002, a decrease of $58.6 million, or 40.4% and ACMI contracted revenue, which was $305.5 million for 2003, compared with $358.1 million for 2002, a decrease of $52.6 million, or 14.7%.

          Scheduled Service revenue. Scheduled Service revenues were $524 million for 2003, compared with $348.2 million for 2002, an increase of $175.8 million, or 50.5%, primarily due to lower yields and lower load factors, offset by higher capacity. RTMs in the Scheduled Service segment were 1,844 million on a total capacity of 3,253

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million ATMs in 2003, compared with RTMs of 1,191 million on a total capacity of 1,930 million ATMs in 2002. Load factor was 56.7% with a yield of $0.284 in 2003, compared with a load factor of 61.7% and a yield of $0.292 in 2002. RATM in our Scheduled Service segment was $0.161 in 2003, compared with $0.180 in 2002, representing a decrease of 10.6%.

          ACMI Contract revenue. ACMI contract revenues were $305.5 million for 2003, compared with $358.1 million for 2002, a decrease of $52.6 million, or 14.7%, primarily due to a decrease in the volume of ACMI leasing contracts combined with a decrease in rate per Block Hour. ACMI Block Hours were 58,536 for 2003, compared with 61,794 for 2002, a decrease of 3,258, or 5.3%. Revenue per Block Hour was $5,219 for 2003, compared with $5,795 for 2002, a decrease of $576 per Block Hour, or 9.9%.

          AMC Charter revenue. AMC Charter revenues were $430.3 million for 2003, compared with $231.4 million for 2002, an increase of $198.9 million, or 86.0%, primarily due to both higher volume of AMC Charter flights and an increase in AMC Charter rates. AMC Charter Block Hours were 34,959 for 2003, compared with 18,040 for 2002, an increase of 16,919, or 93.8%. Revenue per Block Hour was $12,308 for 2003, compared with $12,824 for 2002, a decrease of $516 per Block Hour, or 4.0%. The increase in AMC Charter activity was primarily attributable to the build-up to the military conflict in Iraq during 2003.

          Commercial charter revenue. Commercial charter revenues were $86.6 million for 2003, compared with $145.2 million for 2002, a decrease of $58.6 million, or 40.4%, primarily as a result of a lower volume of commercial charter flights and lower rates. Commercial charter Block Hours were 7,956 for 2003, compared with 13,779 for 2002, a decrease of 5,823, or 42.3%. Revenue per Block Hour was $10,884 for 2003, compared with $10,540 for 2002, an increase of $343 per Block Hour, or 3.3%. The reduction in volumes in 2003 was caused in part by the peak level of demand that existed in the fourth quarter of 2002 related to the work stoppage in the shipping ports of the west coast of the U.S.

          Salaries, wages and benefits expense. Salaries, wages and benefits were $194.4 million for 2003, compared with $188.5 million for 2002, an increase of $5.9 million, or 3.1%. Salaries, wages and benefits for air crew employees increased by $19.5 million, or 18.7%, during 2003, compared with 2002 primarily due to the increase in total Block Hours flown of 11.1% and contractual pay rate increases for crew members.

          Maintenance, materials and repairs. Maintenance, materials and repairs was $197.6 million for 2003, compared with $202.4 million for 2002, a decrease of $4.8 million, or 2.4%. The decrease in maintenance expense is the result of the delay in scheduled maintenance events prior to our entrance into bankruptcy in 2004.

          Aircraft fuel expense. Aircraft fuel expense was $326.0 million for 2003, compared with $221.6 million for 2002, an increase of $104.4 million, or 47.1%, as a result of an increase in average fuel price, and an increase in consumption. Average fuel price per gallon was 98 cents for 2003, compared with 91 cents for 2002, an increase of 7 cents, or 7.7%, combined with an increase in fuel consumption to 333.7 million gallons for 2003, compared with 242.7 million gallons for 2002, an increase of 91.0 million gallons, or 37.5%. The increase in fuel consumption of 91 million gallons is driven by the increase in non-ACMI Block Hours of 19,057 from 81,095 in 2002 to 100,152 in 2003.

          Aircraft rent. Aircraft rents were $183.3 million for 2003, compared with $213.3 million for 2002, a decrease of $30.0 million, or 14.1% primarily the result of the reclassification of five operating leases to capital leases during 2003. See Note 11 to the Consolidated Financial Statements included in Item 8 of Part II of this Report.

          Ground handling and airport fees. Ground handling and airport fees were $86.6 million for 2003, compared with $66.5 million for 2002, an increase of $20.1 million, or 30.2%, primarily the result of increased Scheduled Service Block Hours and departures.

          Landing fees and other rent. Landing fees and other rent were $92.0 million in 2003, compared with $63.2 million for 2002, an increase of $28.8 million, or 45.6%, primarily the result of increased Scheduled Service and AMC Block Hours and departures.

          Depreciation and amortization expense. Depreciation and amortization expense was $60.1 million for 2003, compared with $54.4 million for 2002, an increase of $5.7 million, or 10.5%, primarily as a result of increased

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depreciation on five capital leases that were reclassified from operating leases in 2003. See Note 11 to the Consolidated Financial Statements included in Item 8 of Part II of this Report.

          Pre-petition costs and related professional fees. Pre-petition costs and related profession fees were $44.4 million in 2003 primarily related to legal and advisory costs incurred in the restructuring of our debt prior to entry into bankruptcy.

          Other operating expense. Other operating expenses were $145.9 million for 2003, compared with $139.3 million for 2002, an increase of $6.6 million, or 4.7%. The increase in other operating expenses was primarily the result of increased use of contractors in 2003.

          Interest income. Interest income was $3.7 million for 2003, compared with $10.3 million for 2002, a decrease of $6.6 million, or 64.1%, due primarily to decreases in interest rates and a decline in our available cash balances and investments.

          Interest expense. Interest expense was $97.3 million for 2003, compared with $82.8 million for 2002, an increase of $14.5 million, or 17.5% resulting primarily from interest expense related to the reclassification of five operating leases to capital leases during 2003. See Note 11 to the Consolidated Financial Statements included in Item 8 of Part II of this Report.

          Net loss. As a result of the foregoing, we recorded a net loss of $101.0 million, during the 2003, which compares with a net loss of $98.4 million, for the same period in 2002 (exclusive of $44.6 million related to a change in the method of accounting for maintenance; see Note 4 to the Consolidated Financial Statements included in Item 8 of Part II of this Report). The increase in the Net loss is the result of the factors discussed above.

Scheduled Service Segment

          The Scheduled Service segment had a FAC loss of $92.6 million for 2003, compared with a FAC loss of $15.5 million for the same period in 2002. The combination of higher fuel prices and lower unit revenue (RATM) led to the decline in year-over-year FAC.

ACMI Contract Segment

          FAC relating to the ACMI charter segment was a loss of $25.1 million for 2003, compared with a loss of $25.8 million for the same period in 2002.

AMC Charter Segment

          FAC relating to the AMC Charter segment totaled $64.9 million for 2003, compared with income of $20.0 million for the same period in 2002. The increase in FAC was primarily the result of 93.8% higher Block Hours and 86.0% higher revenue in 2003, compared with 2002. The increase in AMC charter activity was primarily due to the peak AMC demand that existed in the first and second quarter of 2003 attributable to the buildup to the military conflict in Iraq.

Commercial Charter Segment

          FAC relating to the Commercial Charter segment was $3.1 million for 2003, compared with income of $2.3 million for the same period in 2002.

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Operating Statistics

          The table below sets forth selected operating data for the years ended December 31 (in thousands unless otherwise indicated):

	2004			2003			2002
Block Hours
Scheduled Service		55,111			54,217			33,149
Commercial Charter		4,973			7,956			13,779
AMC Charter		22,376			34,959			18,040
ACMI Contract		70,343			58,536			61,794
Non Revenue / Other		1,176			3,020			16,127
Total Block Hours		153,979			158,688			142,889
Revenue Per Block Hour
AMC Charter		12,625.5			12,308.3			12,824.2
ACMI Contract		5,354.6			5,218.6			5,794.7
Commercial Charter	$	13,902.5		$	10,883.9		$	10,539.8
Scheduled Service Traffic
RTM’s		2,021,903			1,843,881			1,191,026
ATM’s		3,222,942			3,253,236			1,929,699
Load Factor		62.73	%		56.68	%		61.72	%
RATM	$	0.198		$	0.161		$	0.180
Yield	$	0.316		$	0.284		$	0.292
Average fuel cost per gallon	$	1.25		$	0.98		$	0.91
Fuel gallons consumed		280,304			333,747			242,755
Operating Fleet (average during the period)
Aircraft count		37.7			45.0			43.5
Out of service*		3.3			3.3			6.2
Dry Leased*		4.0			3.7			2.7

*  Dry leased and out of service aircraft are not included in the operating fleet average aircraft count.

          For 2004 compared with 2003 our operating fleet decreased 16.2%, to 37.7 average aircraft from 45.0. The decrease was primarily due to the rejection and return of ten aircraft in connection with the Plan of Reorganization and the subsequent repurchase of two aircraft, one of which has been deactivated and excluded from the fleet count.

Liquidity and Capital Resources

          At December 31, 2004, we had cash and cash equivalents of $133.9 million, compared with $93.3 million at December 31, 2003, an increase of $40.6 million. The available borrowing capacity under our Revolving Credit Facility, when combined with our available cash reserves after our exit from Bankruptcy, has provided us with adequate liquidity to resume payments on debt. See Note 10 to the Consolidated Financial Statements included in Item 8 of Part II of this Report for a description of the Revolving Credit Facility. We expect cash on hand, cash generated from operations and cash available under the Revolving Credit Facility to be sufficient to meet our debt and lease obligations and to finance capital expenditures of approximately $25.0 million for 2005. To the extent that these levels of cash prove insufficient to meet those obligations, we would be required to scale back operations, curtail capital spending or borrow additional funds in amounts to be determined and on terms that may not be favorable to us, if available at all.

          Operating Activities. Net cash provided by operating activities for 2004 was $98.0 million, compared with net cash used by operating activities of $73.5 million for 2003, primarily due to increased profitability from improved market conditions.

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          Investing Activities. Net cash expenditures for investing activities were $49.0 million for 2004, which reflect capital expenditures of $28.2 million and the funding of restricted funds held in trust of $40.2 million. Net cash provided by investing activities was $32.5 million for 2003, which reflect capital expenditures of $8.5 million, partially offset by proceeds from the sale of property and equipment of $10.0 million and net maturing investments of $31.0 million.

          Financing Activities. Net cash used by financing activities was $8.6 million for 2004, which consisted primarily of $42.6 million of payments on long-term debt and capital lease obligations, partially offset by $18.0 million in loan proceeds and $20.2 million in the sale of subscription shares. Net cash used for financing activities was $88.1 million for 2003, which consisted primarily of payments on long-term debt and capital lease obligations. The reduction in debt and lease payments in 2004, relates primarily to the moratorium that was placed on these agreements in March 2003 to complete the restructuring negotiation of these agreements with our significant creditors and lessors. See Note 2 to our Consolidated Financial Statements included in Item 8 of Part II of this Report for more information on such moratorium.

Contractual Obligations

          The following table provides details of the Company’s future cash contractual obligations as of December 31, 2004 (in thousands):

	Payments Due By Period
	Total		2005		2006		2007		2008		2009		Thereafter
Debt and capital lease obligations (1)	$	769,223	$	53,628	$	60,452	$	66,667	$	79,222	$	96,471	$	412,783
Aircraft operating leases		2,587,190		139,809		128,052		128,052		143,277		145,499		1,902,501
Other operating leases		35,815		7,482		5,644		4,810		4,578		4,345		8,956
Total	$	3,392,228	$	200,919	$	194,148	$	199,529	$	227,077	$	246,315	$	2,324,240

(1) Certain of our debt and leases payments contain variable interest components. Any prospective changes as a result of such variability and discounts related to fresh-start accounting valuations are excluded.

Description of the Company’s Debt Obligations

          The following paragraphs provide a summary of the treatment in the financial statements for the restructuring of the Company’s debt obligations and changes that have occurred as a result of the Chapter 11 Cases. It should be noted that, for accounting purposes, the restructuring described below was given effect upon entering into binding term sheets with the respective lender or lessor as the parties to such agreements were operating under the revised terms of the agreements as if they were completed. In certain instances the agreements only became legally binding on the Effective Date or upon the occurrence of certain events after such date.

Deutsche Bank Trust Company

          Deutsche Bank Trust Company (“Deutsche Bank”) is the administrative agent for two syndicated loans to Atlas and its affiliates. One loan was made to AFL III and the other loan was made through the Aircraft Credit Facility. The obligations under these two credit facilities are secured by 15 Boeing 747-200’s and one Boeing 747-300 aircraft and several spare General Electric CF6-50E2 and CF6-80C2 engines. AFL III leases the collateral securing the AFL III Credit Facility, including aircraft and related equipment, to Atlas. AFL III has collaterally assigned those leases and the proceeds thereof to Deutsche Bank as security for the AFL III Credit Facility.

          Atlas, AFL III, Deutsche Bank, as administrative agent, and a majority of the lenders comprising the bank group under each credit facility, executed forbearance agreements, dated July 3, 2003, which contained the terms of the initial loan restructurings. In January, February and March 2004, the parties entered into letter agreements that further amended the original forbearance agreements (as amended, the “Forbearance Agreements”).

Aircraft Credit Facility

          Under the Forbearance Agreements, with respect to the Aircraft Credit Facility, the lenders agreed to accept lower monthly principal payments over a longer term. As additional consideration for the restructuring, the

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lenders under the Aircraft Credit Facility received, among other things, (i) 66,800 shares of New Common Stock and (ii) guarantees of the loan obligations from Atlas’s affiliates upon confirmation of the Plan of Reorganization. Atlas and the ACF lenders executed an amended and restated credit agreement on July 27, 2004.

          On November 30, 2004, Holdings and Atlas entered into amendments (the “ACF Amendments”) to the Aircraft Credit Facility by and among Atlas, the lenders party thereto and Deutsche Bank. The ACF Amendments increased the capital expenditure limitations included in the Aircraft Credit Facility to $25 million (from $20 million), subject to certain adjustments.

          The Aircraft Credit Facility is secured by a first priority security interest in one Boeing 747-300 aircraft (tail number N355MC) and two Boeing 747-200 aircraft (tail numbers N536MC and N540MC).

AFL III Credit Facility

          Under the Forbearance Agreements, the AFL III lenders agreed to accept lower monthly principal payments over a longer term including a deferral of up to $20.3 million in principal payments otherwise due in 2004 and in early 2005, provided that Atlas performs certain maintenance events on the aircraft collateral during such period. The deferred amount is due December 31, 2009, unless Atlas exceeds certain financial targets, in which case part of the deferred amount may become due earlier. AFL III and its lenders executed an amended and restated credit agreement on July 27, 2004. As additional consideration for the restructuring, the lenders under the AFL III Credit Facility received 253,200 shares of the New Common Stock to be issued under the Plan of Reorganization

          The AFL III Credit Facility is secured by a first priority security interest in thirteen Boeing 747-200F aircraft, plus nine CF6-50E2 engines and three CF6-80C2 engines. The aircraft tail numbers securing the AFL III Credit Facility as of December 31, 2004 were: N505MC, N509MC, N512MC, N517MC, N522MC, N523MC, N524MC, N526MC, N527MC, N528MC, N534MC, N808MC and N809MC.

          On November 30, 2004, AFL III entered into an amendment (the “AFL III Amendment”) to the AFL III Credit Facility. The AFL III Amendment increased the annual capital expenditure limitations included in the AFL III Credit Agreement to $25 million, subject to certain adjustments. Fifteen leases relating to the thirteen aircraft and two engine pools from AFL III to Atlas pursuant to the AFL III Credit Facility were also amended to comply with the AFL III Amendments.

Enhanced Equipment Trust Certificate Transactions

Overview of EETC Transactions

          In three separate transactions in 1998, 1999 and 2000, Atlas issued pass-through certificates, also known as Enhanced Equipment Trust Certificates (“EETCs”). These securities were issued for the purposes of financing the acquisition of a total of 12 Boeing 747-400 aircraft. In the 1998 EETC transaction, $538.9 million of EETCs were issued to finance five aircraft, one of which Atlas then owned, with the remaining four being leased by Atlas pursuant to leveraged leases. In the 1999 EETC transaction, $543.6 million of EETCs were issued to finance five aircraft, one of which Atlas then owned, with the remaining four being leased by Atlas pursuant to leveraged leases. In the 2000 EETC transaction, $217.3 million of EETCs were issued to finance the remaining two aircraft, both pursuant to leveraged leases. Historically, the debt obligations relating solely to owned EETC aircraft have been reflected on the Company’s balance sheet, while the debt obligations related to the leased EETC aircraft have not been reflected on the Company’s balance sheet because such obligations previously constituted operating leases. Through the restructuring however, Atlas became the beneficial owner of four of the previously leased aircraft (see Restructuring of EETCs below) resulting in a total of six aircraft reflected on the Company’s balance sheet.

Leverage Lease Structure

          In a leveraged lease, the owner trustee is the owner of record for the aircraft. Wells Fargo serves as the owner trustee with respect to the leveraged leases in each of Atlas’s EETC transactions. As the owner trustee of the aircraft, the owner trustee also serves as the lessor of the aircraft under the EETC lease between Atlas and the owner trustee. The owner trustee also serves as trustee for the beneficial owner of the aircraft, the owner participant. The original owner participant for each aircraft invested (on an equity basis) approximately 20% of the original cost of

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the aircraft. The remaining approximately 80% of the aircraft cost was financed with debt issued by the owner trustee on a non-recourse basis in the form of equipment notes.

          The equipment notes were generally issued in three series, or “tranches,” for each aircraft, designated as Series A, B and C equipment notes. The loans evidenced by the equipment notes were funded by the public offering of EETCs. Like the equipment notes, the EETCs were issued in three series for each EETC transaction designated as Series A, B and C EETCs. Each class of EETCs was issued by the trustee for separate Atlas Pass Through Trusts with the same designation as the class of EETCs issued. Each of these Pass Through Trustees is also the holder and beneficial owner of the equipment notes bearing the same class designation.

          With respect to the two EETC financed aircraft previously and currently owned by Atlas, there is no leveraged lease structure or EETC lease. Atlas is the beneficial owner of the aircraft and the issuer of the equipment notes with respect thereto. The equipment notes issued with respect to the owned aircraft are with full recourse to Atlas.

Restructuring of EETCs

          On September 12, 2003, the Company and a majority in interest of its Class A EETC holders from the 1998, 1999 and 2000 EETC transactions entered into three restructuring agreements, one for each then existing EETC transaction. Each restructuring agreement was subsequently amended as of November 4, 2003, December 15, 2003, February 5, 2004 and March 31, 2004. As of February 5, 2004, the Company also entered into a term sheet (the “OP Term Sheet”) with the owner participants with respect to six of the ten aircraft leased under the EETC transactions. Each of the restructuring agreements, together with the OP Term Sheet, are collectively referred to herein as the “EETC Restructuring Agreements”.

          Pursuant to the EETC Restructuring Agreements, the aircraft leases were amended to provide for basic rent of $725,000 per month for the first sixty months beginning in January 1, 2003, and basic rent of $830,000 per month thereafter, until the equipment notes underlying the EETCs are paid or satisfied in full, subject to adjustment during 2005 for repayment of a $23.0 million EETC deferred rent obligation. The equipment notes underlying the EETCs relating to two aircraft which were owned originally by Atlas will be amortized based on the same monthly payment amounts as the leased aircraft. The term of the leases and equipment notes underlying the EETCs were generally extended to fully amortize the underlying equipment notes on the leased aircraft and the owned aircraft. A number of factors can affect the timing of payments to the EETCs, including the appraised value and the future appraised fair market lease rates for the aircraft underlying the EETC and any sale of an aircraft pursuant to the terms of the EETC Restructuring Agreements and the financial performance of the Company. For example, the Class C EETCs were originally scheduled to be paid first, followed by the Class B EETCs and then the Class A EETCs. Following a triggering event caused by the Company’s Chapter 11 Cases and the adjustments to payments as a result of appraised values of the EETC aircraft, it is now expected that on an average life basis, the Class A EETCs will generally be paid first, followed by the Class B EETCs and then the Class C EETCs. Total yield on the EETCs will be affected by the changes in timing of their payments.

          Under the terms of the EETC Restructuring Agreements, once the EETCs from any of the EETC transactions are paid in full, any remaining balances on the related underlying equipment notes will be forgiven.

          The EETC Restructuring Agreements provide that, for the leased aircraft underlying the EETCs, lease payments will continue following payment or forgiveness of the related underlying equipment notes. This so called “equity rent” is paid to the owner trustee and distributed to the owner participant. Equity rent provides an economic return to the owner participants based on their original investment in the aircraft, in addition to the residual value of the aircraft and any tax benefits related to ownership. Prior to their restructuring, the EETC transactions had provided for periodic payments of equity rents over the term of the leases of the aircraft underlying the EETCs. Pursuant to the EETC Restructuring Agreements, all equity rents are delayed until payment of the related underlying equipment notes, or their forgiveness following payment of the EETCs. Pursuant to the OP Term Sheet, adjusted rent schedules providing equity rents and lease extensions were negotiated with respect to several leased aircraft in the EETC transactions. The lease agreements relating to those aircraft were filed with the Bankruptcy Court in connection with Stipulations under Section 1110(b) of the Bankruptcy Code as to such aircraft.

          In addition, pursuant to the EETC Restructuring Agreements, Atlas has entered into airframe and engine maintenance agreements applicable to the aircraft underlying the EETCs.

43

          Concurrent with the consummation of the Revolving Credit Facility and related events described below, certain amendments to the Company’s EETC agreements, as described in the Company’s Second Amended Disclosure Statement Under 11 U.S.C. §1125 in Support of the Debtors’ Plan of Reorganization, automatically took effect on November 30, 2004.

Revolving Credit Facility

          On November 30, 2004, we entered into a Revolving Credit Facility. This Revolving Credit Facility provides us with revolving loans of up to $60 million, including up to $10 million of letter of credit accommodations. Availability under the Revolving Credit Facility will be based on a borrowing base, which will be calculated as a percentage of certain eligible accounts receivable. The Revolving Credit Facility has an initial four-year term after which the parties can agree to enter into additional one-year renewal periods.

          Borrowings under the Revolving Credit Facility bear interest at varying rates based on either the Prime Rate or the Adjusted Eurodollar Rate. Interest on outstanding borrowings is determined by adding a margin to either the Prime Rate or the Adjusted Eurodollar Rate, as applicable, in effect at the interest calculation date. The margins are arranged in three pricing levels, based on the amount available to be borrowed under the Revolving Credit Facility, that range from ..25% below to .75% above the Prime Rate and 1.75% to 2.75% above the Adjusted Eurodollar Rate.

          The obligations under the Revolving Credit Facility are secured by our present and future assets and all products and proceeds thereof, other than (i) real property, (ii) aircraft, flight simulators, spare aircraft engines and related assets that are subject to security interests of other creditors and (iii) some or all of the capital stock of certain of AAWW’s subsidiaries.

          The Revolving Credit Facility contains usual and customary covenants for transactions of this kind. At December 31, 2004, we had $19.0 million available for borrowing under the Revolving Credit Facility. No borrowings have been incurred as of December 31, 2004 or for the period then ended.

Other

Critical Accounting Policies

General Discussion of Critical Accounting Policies

          The Consolidated Financial Statements are prepared in conformity with GAAP which requires management to make estimates and judgments that affect the amounts reported. Actual results may differ from those estimates. Important estimates include asset lives, valuation allowances (including, but not limited to, those related to receivables, inventory and deferred taxes), income tax accounting, self-insurance employee benefit accruals and contingent liabilities. Our significant accounting policies are described in Note 4 to the Consolidated Financial Statements included in Item 8 of Part II of this Report. The following describes our most critical accounting policies:

Fresh-Start Accounting

          The Company’s emergence from bankruptcy on July 27, 2004 resulted in a new reporting entity and adoption of fresh-start accounting as of the Effective Date in accordance with SOP 90-7. Accordingly, our assets, liabilities, and equity were adjusted to fair value. These adjustments were based upon the work of the Company and financial consultants and also independent appraisals to determine the relative fair values of the Company’s assets and liabilities. Estimates of fair value represent the Company’s best estimate based on the work of independent valuation consultants and, where the foregoing are not available, industry trends and by reference to market rates and transactions. These estimates and the assumptions used by the Company and by its valuation consultants, are subject to certain uncertainties and contingencies beyond the Company’s control. If different assumptions were used, the fair values of the Company’s assets and liabilities could be materially increased or decreased. The adoption of fresh-start accounting has had a material effect on our Consolidated Financial Statements. See Note 3 to the Consolidated Financial Statements included in Item 8 of Part II of this Report for further detail related to the fresh-start value adjustments.

44

Revenue Recognition

          We recognize revenue when a sales arrangement exists, services have been rendered, the sales price is fixed and determinable, and collectibility is reasonably assured.

          Revenue for Scheduled Services and Charter Services is recognized upon flight departure. ACMI contract revenue is recognized as the actual Block Hours are operated on behalf of a customer during a calendar month.

          Other revenue includes rents from dry leases of owned aircraft and is recognized in accordance with SFAS No. 13, Accounting for Leases.

Allowance for Doubtful Accounts

          We periodically perform an evaluation of our accounts receivable and expected credit trends and establish an allowance for doubtful accounts for specific customers that we determine to have significant credit risk. Past due status of accounts receivable is determined primarily based upon contractual terms. We provide allowances for estimated credit losses that result from the inability or unwillingness of our customers to make required payments and write off receivables when they are deemed uncollectible. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense.

Inventories

          Spare parts, materials and supplies for flight equipment are carried at average acquisition cost and are expensed when used in operations. Allowances for obsolescence for spare parts expected to be on hand at the date aircraft are retired from service, are provided over the estimated useful lives of the related aircraft and engines. Allowances are also provided for spare parts currently identified as excess or obsolete. These allowances are based on management estimates, which are subject to change as conditions in our business evolve. Inventories are included in prepaid expenses and other current assets in the consolidated balance sheet, except for rotable inventory that is recorded in “Property and Equipment.”

Property and Equipment

          We record our property and equipment at cost and once assets are placed in service we depreciate them on a straight-line basis over their estimated useful lives to their estimated residual values, over periods not to exceed forty years for flight equipment (from date of original manufacture) and three to five years for ground equipment. Property under capital leases and related obligations are recorded at the lesser of an amount equal to (a) the present value of future minimum lease payments computed on the basis of our incremental borrowing rate or, when known, the interest rate implicit in the lease, or (b) the fair value of the asset. Amortization of property under capital leases is on a straight-line basis over the lease term and is included in depreciation expense. If ownership takes place or a purchase option exists, amortization is over the estimated remaining useful life of the aircraft.

          Expenditures for major additions, improvements and flight equipment modifications are generally capitalized and depreciated over the shorter of the remaining life of the asset or the term of the lease in the event that any modifications or improvements are made to operating leased equipment. Substantially all property and equipment is specifically pledged as collateral for our indebtedness.

Measurement of Impairment of Long-Lived Assets

          When events and circumstances indicate that assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amount, we record impairment losses with respect to those assets.

          The impairment charge is determined based upon the amount by which the net book value of the assets exceeds their estimated fair value. In determining the fair value of the assets, we consider market trends, published values for similar assets, recent transactions involving sales of similar assets or quotes from third party appraisals. In making these determinations, we also use certain assumptions, including, but not limited to the estimated future cash flows expected to be generated by these assets, which are based on additional assumptions such as asset utilization, length of service the asset will be used in our operations and estimated residual values.

45

Intangible Assets

          Route acquisition costs primarily include operating rights (takeoff and landing slots) at Narita Airport in Tokyo, Japan. Airline operators certificates (“AOCs”) represent the allocated value of existing licenses to operate aircraft in commercial service. “Flight Authorities” represent the allocated value of legal rights, regulatory permits, and airport landing slots required for a scheduled airline to serve international markets. Since each of these operating rights is considered to have an indefinite life, no amortization has been recorded.

          ACMI customer contracts represent the future profits expected from customer contracts in hand as of the Effective Date. Fair market value of operating leases represents the amount recorded to adjust leases of our Boeing 747 aircraft to fair market value as of the Effective Date. It is an asset as certain operating lease rates (primarily 747-400’s) were below market at that date.

          Under Statement of Financial Accounting Standard (“SFAS”) No.142, Goodwill and Other Intangible Assets (“SFAS No. 142”), intangibles with indefinite lives are not amortized but reviewed for impairment annually, or more frequently, if impairment indicators arise. The carrying value and ultimate realization of these assets is dependent upon estimates of future earnings and benefits that the Company expects to generate from their use. If the Company’s expectations of future results and cash flows change and are significantly diminished, intangible assets may be impaired and the resulting charge to operations may be material. The estimation of useful lives and expected cash flows requires the Company to make significant judgments regarding future periods that are subject to some factors outside its control. Changes in these estimates can result in significant revisions to the carrying value of these assets and may result in material changes to the results of operations. The estimated life of the Route acquisition costs, AOCs, and Flight Authorities is indefinite. Intangibles with definite lives are amortized over their respectful useful lives, which are as follows:

ACMI customer contracts	up to 5 years, customer by customer
Fair market value operating leases	21 years

Income Taxes

          We provide for income taxes using the asset and liability method. Under this method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. If necessary, deferred income tax assets are reduced by a valuation allowance to an amount that is determined to be more likely than not recoverable. We must make significant estimates and assumptions about future taxable income and future tax consequences when determining the amount of the valuation allowance. In addition, tax reserves are based on significant estimates and assumptions as to the relative filing positions and potential audit and litigation exposures thereto. The effect on deferred taxes of a change in tax laws or tax rates is recognized in the results of operations in the period that includes the enactment date.

Aircraft Maintenance and Repair

          Maintenance and repair cost for both owned and leased aircraft are charged to expense as incurred, except Boeing 747-400 engine (GE CF6-80C2) overhaul costs through January 2004. These were performed under a fully outsourced, power-by-the-hour maintenance agreement; the costs there under are accrued based on the hours flown. This contract was rejected during the Chapter 11 Cases.

Stock-based Compensation

          To date, we have accounted for stock-based compensation by using the intrinsic value based method in accordance with the provisions of Accounting Principles Board (“APB”) Opinion No. 25, Accounting for Stock Issued to Employees, and related interpretations. Accordingly, we have only recorded compensation expense for any stock options granted with an exercise price that is less than the fair market value of the underlying stock at the date of grant. Refer to the section entitled “Recent Accounting Pronouncements” in our Consolidated Financial Statements included in Item 8 of Part II of this Report for a discussion of the impact of the recently issued Statement of Financial Accounting Standards (“SFAS”) No. 123(R), Share-based Payment, on our recording of stock-based compensation for interim or annual reporting periods beginning on or after December 15, 2005.

46

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

          We do not currently hedge against foreign currency fluctuations, interest rate movements or aviation fuel prices.

          The risk inherent in our market-sensitive instruments and positions is the potential loss arising from adverse changes to the price and availability of aviation fuel and interest rates as discussed below. The sensitivity analyses presented herein do not consider the effects that such adverse changes might have on our overall financial performance, nor do they consider additional actions we may take to mitigate our exposure to such changes. Variable-rate leases are not considered market-sensitive financial instruments and, therefore, are not included in the interest rate sensitivity analysis below. Actual results may differ. See Note 4 to our Consolidated Financial Statements included in Item 8 of Part II of this Report for accounting policies and additional information.

          Foreign Currency. We are exposed to market risk from changes in foreign currency exchange rates, interest rates and equity prices that could affect our results of operations and financial condition. The Company’s largest exposure comes from the British pound, the Euro, the Japanese yen and various Asian currencies. The Company does not currently have a foreign currency hedging program related to its foreign currency-denominated sales.

          Aviation fuel. Our results of operations are affected by changes in the price and availability of aviation fuel. Market risk is estimated at a hypothetical 10% increase in the 2004 average cost per gallon of fuel. Based on actual 2004 fuel consumption for the Scheduled Service and Commercial Charter business segments, such an increase would result in an increase to annual aviation fuel expense of approximately $35.1 million in 2004. Fuel prices for AMC are set each September by the military and are fixed for the year. ACMI does not present a market risk, as the cost of fuel is borne by the customer.

          Interest. Our earnings are subject to market risk from exposure to changes in interest rates on our variable-rate debt instruments and on interest income generated from our cash and investment balances. At December 31, 2004, approximately $207.3 million of our debt at face value had floating interest rates. If interest rates increase by a hypothetical 20% in the underlying rate as of December 31, 2004, our annual interest expense would increase for 2005 by approximately $2.4 million.

          Market risk for fixed-rate long-term debt is estimated as the potential decrease in fair value resulting from a hypothetical 20% increase in interest rates, and amounts to approximately $41.7 million as of December 31, 2004. The fair value of our fixed rate debt was $451.3 at December 31, 2004 (See Note 14 to the Consolidated Financial Statements included in Item 8 of Part II of this Report). The fair values of our long-term debt were estimated using quoted market prices and discounted future cash flows.

          Borrowings under the Revolving Credit Facility bear interest at varying rates based on either the Prime Rate or the Adjusted Eurodollar Rate. Interest on outstanding borrowings is determined by adding a margin to either the Prime Rate or the Adjusted Eurodollar Rate, as applicable, in effect at the interest calculation date. The margins are arranged in three pricing levels, based on the excess availability under the Revolving Credit Facility. There is no balance outstanding on this facility and changes in interest rates therefore would have had no impact on our reported consolidated income to date.

47

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA

Report of Independent Registered Public Accounting Firm	49
Consolidated Balance Sheets as of December 31, 2004 (Successor) and 2003 (Predecessor)	50
Consolidated Statements of Operations for the periods July 28, 2004 through December 31, 2004 (Successor), January 1, 2004 through July 27, 2004 and for the years ended December 31, 2003 and 2002 (Predecessor)	51
Consolidated Statements of Cash Flows for the periods July 28, 2004 through December 31, 2004 (Successor), January 1, 2004 through July 28, 2004 and for the years ended December 31, 2003 and 2002 (Predecessor)	52
Consolidated Statements of Stockholders’ Equity (Deficit) for the periods July 28, 2004 through December 31, 2004 (Successor), January 1, 2004 through July 27, 2004 and for the years ended December 31, 2003 and 2002 (Predecessor)	53
Notes to Consolidated Financial Statements	54
Schedule II—Valuation and Qualifying Accounts	S-1

48

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders
Atlas Air Worldwide Holdings, Inc.

We have audited the accompanying consolidated balance sheets of Atlas Air Worldwide Holdings, Inc. as of December 31, 2004 (Successor) and December 31, 2003 (Predecessor), and the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows for the period July 28, 2004 through December 31, 2004 (Successor) and the period January 1, 2004 through July 27, 2004 and each of the two years in the period ended December 31, 2003 (Predecessor). Our audit also included the financial statement schedule listed in the Index at Item 15(a). These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Atlas Air Worldwide Holdings, Inc. at December 31, 2004 (Successor) and December 31, 2003 (Predecessor), and the consolidated results of their operations and their cash flows for the period July 28, 2004 through December 31, 2004 (Successor) and the period January 1, 2004 through July 27, 2004 and each of the two years in the period ended December 31, 2003 (Predecessor), in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Note 4 to the Consolidated Financial Statements, in 2002 the Company changed its method of accounting for its airframe and engine overhauls.

/s/ ERNST & YOUNG LLP        

New York, New York

May 19, 2005

49

ATLAS AIR WORLDWIDE HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)

	Successor			Predecessor
As of December 31,	2004			2003
Assets
Current Assets
Cash and cash equivalents	$	133,917		$	93,297
Restricted funds held in trust		20,889			—
Accounts receivable, net of allowance of $11,252 and $24,304, respectively		141,012			159,393
Prepaid maintenance		71,363			86,876
Deferred taxes		11,339			8,508
Prepaid expenses and other current assets, net of accumulated amortization of zero and $28,689, respectively		16,703			41,274
Total current assets		395,223			389,348
Other Assets
Property and equipment, net		609,754			795,094
Deposits and other assets		33,779			59,760
Lease contracts and intangible assets, net		103,440			42,238
Prepaid aircraft rent		—			114,167
Total Assets	$	1,142,196		$	1,400,607
Liabilities and Stockholders’ Equity (Deficit)
Current Liabilities
Accounts payable	$	18,024		$	35,530
Accrued liabilities		169,024			176,817
Current portion of long-term debt		36,084			964,557
Total current liabilities		223,132			1,176,904
Other Liabilities
Long-term debt		602,985			—
Deferred gains, net		—			170,363
Accrued maintenance		—			62,119
Deferred tax liability		28,258			8,508
Other liabilities		9,859			10,995
Total other liabilities		641,102			251,985
Commitments and Contingencies (Note 16)
Stockholders’ Equity (Deficit)
Preferred stock, $1 par value; 10,000,000 shares authorized; no shares issued		—			—
New Common stock, $0.01 par value; 50,000,000 shares authorized;3,607,934 shares issued and outstanding		36			—
Old Common Stock, $0.01 par value; 50,000,000 shares authorized; 38,377,504 shares issued and outstanding		—			384
Treasury stock, at cost; zero and 1,050 shares, respectively		—			(4	)
Additional paid-in-capital		48,337			306,303
Common stock to be issued to creditors (Note 3)		216,069			—
Deferred compensation		(9,190	)		—
Retained earnings (accumulated deficit)		22,710			(334,965	)
Total Stockholders’ Equity (Deficit)		277,962			(28,282	)
Total Liabilities and Stockholders’ Equity (Deficit)	$	1,142,196		$	1,400,607

See accompanying notes to Consolidated Financial Statements.

50

ATLAS AIR WORLDWIDE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)

	Successor			Predecessor
	For the Period July 28, 2004 Through December 31, 2004			For the Period January 1, 2004 Through July 27, 2004			For the Year ended December 31, 2003			For the Year ended December 31, 2002
Operating Revenues
Scheduled service	$	296,823		$	343,605		$	524,018		$	348,231
ACMI contracts		182,322			194,332			305,475			358,077
AMC charter		126,235			156,260			430,287			231,350
Charter service		53,325			15,812			86,592			145,235
Other revenue		20,589			25,358			37,279			95,202
Total operating revenues		679,294			735,367			1,383,651			1,178,095
Operating Expenses
Aircraft fuel		176,009			175,103			326,022			221,632
Salaries, wages & benefits		91,463			120,609			194,390			188,531
Maintenance, materials and repairs		102,682			133,336			197,629			202,437
Aircraft rent		60,151			81,886			183,329			213,310
Ground handling		40,815			53,558			86,612			66,513
Landing fees and other rent		37,960			53,039			91,995			63,198
Depreciation and amortization		25,457			33,510			60,138			54,404
Travel		25,741			29,549			59,223			52,963
Pre-petition and post-emergence costs and related professional fees		4,106			11,545			44,382			—
Other		47,935			65,931			145,860			139,261
Total operating expenses		612,319			758,066			1,389,580			1,202,249
Operating income (loss)		66,975			(22,699	)		(5,929	)		(24,154	)
Non-operating Expenses
Interest income		(917	)		(572	)		(3,724	)		(10,335	)
Interest expense (excluding post-petition contractual interest of $20,956 for the period January 31, 2004 through July 27, 2004)		30,582			50,222			97,328			82,757
Other, net		(3,504	)		1,434			1,457			1,793
Reorganization items, net		—			(112,513	)		—			—
Total non-operating expenses (income)		26,161			(61,429	)		95,061			74,215
Income (loss) before income taxes and cumulative effect of accounting change		40,814			38,730			(100,990	)		(98,369	)
Income taxes		18,104			10,484			—			—
Income (loss) before cumulative effect of accounting change		22,710			28,246			(100,990	)		(98,369	)
Cumulative effect of accounting change		—			—			—			44,556
Net income (loss)	$	22,710		$	28,246		$	(100,990	)	$	(53,813	)
Basic income (loss) per share:
Income (loss) before cumulative effect of accounting change	$	1.12		$	0.74		$	(2.63	)	$	(2.57	)
Cumulative effect of accounting change		—			—			—			1.16
Net income (loss)	$	1.12		$	0.74		$	(2.63	)	$	(1.41	)
Diluted income (loss) per share:
Income (loss) before cumulative effect of accounting change	$	1.11		$	0.74		$	(2.63	)	$	(2.57	)
Cumulative effect of accounting change		—			—			—			1.16
Net income (loss)	$	1.11		$	0.74		$	(2.63	)	$	(1.41	)

See accompanying notes to Consolidated Financial Statements.

51

ATLAS AIR WORLDWIDE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

	Successor			Predecessor
	For the Period July 28, 2004 Through December 31, 2004			For the Period January 1, 2004 Through July 27, 2004			For the Year ended December 31, 2003			For the Year ended December 31, 2002
Cash Flows from Operating Activities:
Net Income (loss)	$	22,710		$	28,246		$	(100,990	)	$	(53,813	)
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:
Reorganization items, net		—			(156,722	)		—
Depreciation and amortization		25,457			33,510			60,138			47,389
Accretion of debt discount		6,948			—			—			—
Amortization of operating lease discount		764			—			—			—
Common stock issued as compensation		—			—			—			537
Provision for doubtful accounts		3,409			(2,329	)		19,931			16,349
Cumulative effect of accounting change		—			—			—			(44,556	)
Amortization of debt issuance cost and lease financing deferred gains		—			2,862			(17,574	)		(6,760	)
Recognition of compensation from restricted stock units		1,536			—			410			686
Impairment loss		—			—			—			7,850
Other, net		44			239			2,231			(711	)
Changes in operating assets and liabilities:
Accounts receivable		(22,345	)		36,794			45,705			(29,579	)
Prepaids and other current assets		6,149			17,318			(35,228	)		(24,371	)
Deposits and other assets		(49	)		9,351			(21,919	)		(40,487	)
Accounts payable and accrued liabilities		(16,179	)		100,148			(26,198	)		135,167
Net cash provided (used) by operating activities		28,557			69,417			(73,494	)		7,701
Cash Flows from Investing Activities:
Capital expenditures, net		(11,755	)		(16,441	)		(8,495	)		(30,144	)
Proceeds from sale of property and equipment		—			—			10,000			—
Decrease (increase) in restricted funds held in trust		19,388			(40,153	)		—			—
Proceeds from sale of short-term investments		—			—			—			(348,702	)
Maturity of investments		—			—			31,004			411,854
Net cash (used) provided by investing activities		7,633			(56,594	)		32,509			33,008
Cash Flows from Financing Activities:
Proceeds from loan		—			18,000			—			—
Proceeds from sale of subscription shares		—			20,153			—			—
Proceeds from sale leaseback transactions		—			—			—			14,337
Issuance of common stock		—			—			240			907
Purchase of treasury stock		—			—			(217	)		(1,076	)
Payment of debt issuance costs		(1,256	)		(2,640	)		—
Payment on debt		(11,226	)		(31,404	)		(88,133	)		(83,664	)
Net cash used by financing activities		(12,482	)		4,109			(88,110	)		(69,496	)
Net increase (decrease) in cash		23,688			16,932			(129,095	)		(28,787	)
Cash and cash equivalents at the beginning of period		110,229			93,297			222,392			251,179
Cash and cash equivalents at end of period	$	133,917		$	110,229		$	93,297		$	222,392

See accompanying notes to Consolidated Financial Statements.

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ATLAS AIR WORLDWIDE HOLDINGS, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)
(in thousands, except share amounts)

	New Common Stock		Old Common Stock			Treasury Stock			Additional Paid-In Capital			Common Stock to be issued to Creditors		Retained Earnings (Accumulated Deficit)			Accumulated Other Comprehensive Income (Loss)			Deferred Compen- sation			Total
Predecessor Company:
Balance at December 31, 2001, as previously reported	$	—	$	382		$	(1,268	)	$	305,930		$	—	$	185,114		$	488		$	(738	)	$	489,908
Restatement adjustments		—		—			361			(315	)		—		(365,276	)		(10	)		738			(364,502	)
Balance at December 31, 2001, as restated	$	—	$	382		$	(907	)	$	305,615		$	—	$	(180,162	)	$	478		$	—		$	125,406
Net loss		—		—			—			—			—		(53,813	)		—			—			(53,813	)
Reclassification adjustment for realized gain on available-for-sale securities sold		—		—			—			—			—		—			(478	)		—			(478	)
Comprehensive loss																								(54,291	)
Purchase of 280,000 shares of treasury stock		—		—			(1,076	)		—			—		—			—			—			(1,076	)
Issuance of 284,280 shares of treasury stock pursuant to the employee stock purchase plan		—		—			1,719			(813	)		—		—			—			—			906
Issuance of 24,435 shares of treasury stock pursuant to the director stock plan		—		—			129			2			—		—			—			—			131
Issuance of 3,725 shares of common stock		—		—			—			46			—		—			—			—			46
Issuance of 79,381 shares of common stock pursuant to the director stock plan		—		1			—			360			—		—			—			—			361
Balance at December 31, 2002	$	—	$	383		$	(135	)	$	305,210		$	—	$	(233,975	)	$	—		$	—		$	71,483
Net loss and comprehensive loss		—		—			—			—			—		(100,990	)		—			—			(100,990	)
Purchase of 135,000 shares of treasury stock		—		—			(217	)		—			—		—			—			—			(217	)
Issuance of 182,007 shares of treasury stock		—		—			348			(108	)		—		—			—			—			240
Issuance of 57,471 shares of common stock pursuant to the employee stock purchase plan		—		1			—			1,201			—		—			—			—			1,202
Balance at December 31, 2003	$	—	$	384		$	(4	)	$	306,303		$	—	$	(334,965	)	$	—		$	—		$	(28,282	)
Net income															28,246									28,246
Reorganization adjustments:
Equity write off		—		(384	)		4			(306,303	)		—		306,719			—			—			36
Issuance of 2,997,334 shares of common stock to creditors		30		—			—			37,617			—		—			—			—			37,647
Common stock to be issued to creditors 17,202,666 shares		—		—			—			—			216,069		—			—			—			216,069
Successor Company:
Balance at July 27, 2004	$	30	$	—		$	—		$	37,617		$	216,069	$	—		$	—		$	—			253,716
Net income															22,710									22,710
Issuance of 610,600 shares of restricted stock		6		—			—			10,720			—		—			—			(10,726	)		—
Amortization of restricted stock		—		—			—			—			—		—			—			1,536			1,536
Balance at December 31, 2004	$	36	$	—		$	—		$	48,337		$	216,069	$	22,710		$	—		$	(9,190	)	$	277,962

See accompanying notes to Consolidated Financial Statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

          The accompanying Consolidated Financial Statements (the “Financial Statements”) include the accounts of Atlas Air Worldwide Holdings, Inc. (“Holdings”) and its wholly owned subsidiaries. Holdings is the parent company of two principal operating subsidiaries, Atlas Air, Inc. (“Atlas”) and Polar Air Cargo, Inc. (“Polar”). Holdings, Atlas, Polar and Holdings’ other subsidiaries are referred to in this Report collectively as the “Company”. All significant inter-company accounts and transactions have been eliminated. The Company provides air cargo and related services throughout the world, serving Asia, Europe, South America and the United States through two principal means: (i) airport-to-airport scheduled air cargo service (“Scheduled Service”); and (ii) contractual lease arrangements in which the Company provides the aircraft, crew, maintenance and insurance (“ACMI”, “ACMI contracts”, or in some circumstances “wet leases”). The Company also furnishes seasonal, commercial, military and ad-hoc charter services. See Note 15. The Company operates only Boeing 747 freighter aircraft. Except for per share data, all dollar amounts are in thousands unless otherwise stated.

          The Financial Statements have been prepared in accordance with the American Institute of Certified Public Accountants (“AICPA”) Statement of Position 90-7, “Financial Reporting by Entities in Reorganization under the Bankruptcy Code” (“SOP 90-7”). Expenses (including professional fees), realized gains and losses, and provisions for losses resulting from the reorganization are reported separately as “Reorganization Items”. Also, interest expense is recorded only to the extent that it was to be paid during the pending Chapter 11 Cases or where it was probable that it would be an allowed claim in the Chapter 11 Cases. Cash used for reorganization items is disclosed separately in Note 5. References to “Predecessor Company” refer to the Company prior to July 27, 2004. References to “Successor Company” refer to the Company on and after July 27, 2004, after giving effect to the cancellation of the then-existing common stock and the issuance of new securities in accordance with the Plan of Reorganization and the application of fresh-start reporting. As a result of the application of fresh-start reporting, the Successor Company’s financial statements are not comparable with the Predecessor Company’s financial statements.

2. Background and Bankruptcy

          The sustained weakness of both the United States and international economies that began in early 2001 and continued through the beginning of 2004, coupled with the lingering impact of the September 11, 2001 terrorist attacks, had a negative impact on both international trade demand and the airline industry, including the ACMI and air cargo Scheduled Service markets, which are vital to the Company’s results. Because of the resulting negative impact on the Company’s financial condition and as part of a comprehensive financial restructuring of our aircraft debt and lease obligations, among other things, the Company defaulted on its reporting covenants and payment obligations under substantially all of its debt and lease arrangements. As a result, all debt outstanding was classified as a current liability at December 31, 2003.

          In January 2003, the Company commenced a financial restructuring through negotiations with the lenders under its Aircraft Credit Facility (defined in Note 10) and AFL III Credit Facility (also defined in Note 10) regarding impending principal payments and covenant defaults, as well as the suspension of lease payments on six Boeing 747-200 aircraft. These negotiations were also held in conjunction with negotiations with certain other aircraft lessors to reduce or defer operating lease payments.

          In March 2003, the Company implemented a moratorium on substantially all of its aircraft debt and lease payments to provide time to negotiate restructured agreements with the Company’s significant creditors and lessors. Subsequent to the implementation of this moratorium, the Company made payments on certain debt and lease obligations pursuant to forbearance agreements. However, the continuation of the moratorium beyond what was permitted in the forbearance agreements resulted in additional events of default with respect to substantially all of the Company’s aircraft debt and lease agreements. These defaults allowed the parties to these arrangements to exercise certain rights and remedies, including the right to demand immediate payment of such obligations in full and the right to repossess certain assets, including all of the Company’s owned and leased aircraft.

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          In order to formalize its restructuring efforts, in March 2003 the Company embarked on a comprehensive operational and financial restructuring program that included the following key elements: (i) reorganizing the management team and management functions; (ii) enhancing profitability through operational restructuring initiatives; (iii) reducing fixed financial costs through the restructuring of aircraft-related debt and lease obligations; and (iv) de-leveraging through the conversion of Senior Notes (defined in Note 10) and other unsecured obligations into equity in Holdings.

          Through the course of 2003, the management team refocused the commercial strategies of the Company’s key business segments, implemented operational cost saving initiatives and, with the assistance of its financial and legal advisors, negotiated with its secured aircraft creditors to reduce the rents and payments on its aircraft.

          On January 30, 2004 (the “Bankruptcy Petition Date”), Holdings, Atlas, Polar, Airline Acquisition Corp I (“Acquisition”) and Atlas Worldwide Aviation Logistics, Inc. (“Logistics,” and together with Holdings, Atlas, Polar and Acquisition, the “Debtors”), each filed voluntary bankruptcy petitions for relief under chapter 11 (“Chapter 11”) of title 11 of the United States Code, 11 U.S.C. §§ 101 et seq. (the “Bankruptcy Code”), in the United States Bankruptcy Court for the Southern District of Florida (the “Bankruptcy Court”). The Bankruptcy Court jointly administered these cases as “In re Atlas Air Worldwide Holdings, Inc., Atlas Air, Inc., Polar Air Cargo, Inc., Airline Acquisition Corp I, and Atlas Worldwide Aviation Logistics, Inc., Case No. 04-10792” (collectively, the “Chapter 11 Cases”). During the course of the Chapter 11 Cases, the Debtors operated their respective businesses and managed their respective properties and assets as debtors-in-possession (“DIPs”) under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure and the orders of the Bankruptcy Court. The Bankruptcy Court entered an order confirming the Final Modified Second Amended Joint Plan of Reorganization of the Debtors dated July 14, 2004 (the “Plan of Reorganization”) and the Debtors emerged from bankruptcy on July 27, 2004 (the “Effective Date”). The Consolidated Financial Statements include data for all subsidiaries of the Company, including those that did not participate in the Chapter 11 Cases.

          While in Chapter 11, the Debtors, as DIPs, were authorized to continue to operate as ongoing businesses, but could not engage in transactions outside the ordinary course of business without the prior approval of the Bankruptcy Court.

          During the course of the Chapter 11 Cases, the Debtors were generally not permitted to make payments on debt deemed to be pre-petition debt. However, to the extent the Debtors had reached agreements with certain lenders and lessors on specific aircraft governed by Section 1110 of the Bankruptcy Code, the Debtors continued to make payments on their aircraft lease and debt financings with the approval of the Bankruptcy Court. In addition, the Debtors received the approval of the Bankruptcy Court to pay pre-petition obligations of certain foreign and critical vendors. Also during the Chapter 11 Cases, the Debtors rejected or abandoned ten aircraft (tail numbers N507MC, N518MC, N535MC, N24837, N354MC, N922FT, N923FT, N924FT, N858FT and N859FT) that were originally financed under secured notes or leases and that no longer formed part of the Company’s aircraft fleet plan. Subsequently, the Company purchased two of these rejected aircraft (tail numbers N858FT and N859FT).

          On February 10, 2004, the United States Trustee for the Southern District of Florida appointed two official committees of unsecured creditors (together, the “Creditors’ Committees”), one each for Atlas and Polar. The Creditors’ Committees and their respective legal representatives had a right to be heard on all matters that came before the Bankruptcy Court concerning the Debtors’ reorganization. Pursuant to a global settlement between the Creditors’ Committees and the Debtors, all litigation between the Creditors’ Committees was abated pending final documentation of the settlement terms and submission of a revised Disclosure Statement and Plan of Reorganization. By virtue of the global settlement, the Creditors’ Committees supported confirmation of the Plan of Reorganization. On June 8, 2004, the Debtors’ Disclosure Statement was approved by the Bankruptcy Court, thereby allowing the Debtors to solicit votes to accept the Plan of Reorganization. The Bankruptcy Court entered an order confirming the Plan of Reorganization, which became effective on the Effective Date.

          Pursuant to the Plan of Reorganization, the holders of outstanding equity of Holdings prior to the Effective Date are to receive no distributions.

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          As part of the global settlement and pursuant to the Plan of Reorganization, the holders of allowed unsecured claims against Polar will receive a 60.0% cash distribution. The Company anticipates that the total cash payments under the settlement will be between $25 and $35 million. The cash settlement payments were funded by the Company with cash on hand, which includes proceeds of approximately $20.2 million derived from a subscription offering of Holdings new common stock (“New Common Stock”) to unsecured creditors of Atlas completed in July 2004. Under the global settlement, the percentage of Holdings’ common stock initially anticipated to be allocated to unsecured creditors of Polar were offered to the unsecured creditors of Atlas through this subscription with the subscription proceeds placed in a trust for the benefit of the Polar Creditors. Unpaid amounts related to Polar creditors are shown on the accompanying balance sheet as “restricted funds held in trust” at December 31, 2004. The holders of allowed general unsecured claims against Holdings, Atlas, Acquisition and Logistics will receive, collectively, approximately 17,202,666 shares of the New Common Stock, which, excluding the shares acquired under the subscription, were valued under the Plan of Reorganization at approximately $216.2 million (at the Plan of Reorganization value of $12.57 per share).

          The actual recovery percentage under the Plan of Reorganization to be realized by holders of general unsecured claims against Atlas and Holdings will depend upon the aggregate amount of general unsecured claims that will ultimately be allowed against Holdings, Atlas, Acquisition and Logistics and the actual market value attributable to stock received by each creditor (See Note 3 for a further discussion of claims).

          On July 14, 2004, Holdings, on behalf of Atlas and Polar (collectively, the “Borrowers”), among others, signed a commitment letter with Congress Financial Corporation (“Congress”) and Wachovia Bank National Association (“Wachovia”) for a $60 million secured revolving credit facility. The consummation of the revolving credit facility was predicated upon the Debtors’ emergence from bankruptcy, among other things. On November 30, 2004, the Borrowers, and Holdings and Acquisition, as guarantors (collectively, the “Guarantors”), entered into the secured revolving credit facility with Congress, as agent for the lenders party thereto, and Wachovia, as lead arranger (the “Revolving Credit Facility”) effective December 31, 2004. The Revolving Credit Facility provides the Borrowers with revolving loans of up to $60 million in the aggregate, including up to $10 million of letter of credit accommodations. Availability under the Revolving Credit Facility will be based on a borrowing base, which will be calculated as a percentage of eligible accounts receivable. At December 31, 2004, based on the borrowing base, the Company had $19 million available for borrowing under the Revolving Credit Facility. There was no balance outstanding at December 31, 2004. The Revolving Credit Facility has an initial four-year term after which the parties can agree to enter into additional one-year renewal periods. See Note 10.

3. Reorganization and Fresh-Start Accounting

          Since the Effective Date, the Company has devoted significant effort to reconcile claims to determine the validity, extent, priority and amount of asserted claims against the Debtors’ bankruptcy estates. To further this process, the Company has filed omnibus objections to general unsecured claims and to cure claims. Specifically, the Company filed (i) a First Omnibus Objections to Claims and Supplement thereto on June 16, 2004 and November 12, 2004, respectively, (ii) a Second Omnibus Objections to Claims and Supplement thereto on September 17, 2004 and September 24, 2004, respectively, (iii) a Third Omnibus Objections to Claims on November 12, 2004, and (iv) a Reorganized Debtors’ objection to claims of Internal Revenue Service (the “IRS”) on November 12, 2004. As described below, however, there remain certain claims disputed by the Company.

          On November 12, 2004, the Company also filed a Motion to Determine the Remaining Balance of Scheduled Claims Subject to Critical and Foreign Vendor Payments and Other Adjustments (the “Schedules Motion”). The Schedules Motion seeks to reconcile liabilities set forth in the Debtors’ schedules against payments to critical and foreign vendors made during the pendency of the Chapter 11 Cases. Finally, the Company has entered into agreements pursuant to which the Debtors has resolved cure claims arising from the assumption of executory contracts and unexpired leases.

Total Claims

          As of May 19, 2005, the Company had reviewed over 3,000 scheduled and filed claims aggregating approximately $7.5 billion, with a maximum of $850.8 million of claims that could potentially be allowed. Approximately $657.9 million of claims have been allowed to date, including $12.4 of cure claims and $1.0 million of other secured and priority claims. Claims of $192.9 million remain unresolved, including $116.0 million of unresolved

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IRS claims discussed below; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process.

Atlas Unsecured Claims

          Pursuant to the Plan of Reorganization, the Company will make a pro rata distribution of 17,202,666 shares of New Common Stock to holders of allowed general unsecured claims against Holdings, Atlas, Acquisition and Logistics. General unsecured claims of approximately $2.6 billion were filed against these entities. As of May 19, 2005, claims of $604.6 million have been allowed, claims of $60.4 million remain disputed, and the balance of claims have been withdrawn or disallowed; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process.

Polar Unsecured Claims

          Pursuant to the Plan of Reorganization, the Company will pay cash equal to sixty cents on the dollar for allowed unsecured claims against Polar. General unsecured claims of approximately $408.4 million were filed against Polar. As of May 19, 2005, claims of $39.9 million have been allowed, claims of $16.5 million remain disputed, and the balance of claims have been withdrawn or disallowed; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process. The Company estimates the additional allowed claims against Polar will ultimately be under $1 million.

Administrative, Priority, Secured and Governmental Claims

          By order dated November 16, 2004, the Bankruptcy Court extended to February 1, 2005, the deadline for the Company to object to: (i) administrative claims, (ii) priority unsecured claims, (iii) secured claims and (iv) governmental claims.

IRS Claim

          As part of an ongoing audit and in conjunction with the claims process of the Chapter 11 Cases, the IRS submitted proofs of claim with the Bankruptcy Court for approximately $228.0 million of alleged income tax, employee withholding tax, Federal Unemployment Tax Act (“FUTA”) and excise tax obligations, including penalties and interest. In June 2004, the IRS amended its original proofs of claim with new claims (the “Amended IRS Claims”), reducing its total claim amount to approximately $104.3 million. The Amended IRS Claims are principally composed of a $56.4 million income tax claim and a $40.5 million employment tax claim. The Company disputed the amounts claimed and filed with the Bankruptcy Court several claim objections and a motion under Section 505 of the Bankruptcy Code, challenging the IRS’ claims. For purposes of the confirmation of the Plan of Reorganization, the employment tax portion of the Amended IRS Claims was reduced to $5.3 million. The IRS subsequently filed amended and/or additional proofs of claim against Holdings, Atlas and Polar asserting claims for income tax, employee withholding tax, FUTA tax and excise taxes of approximately $11.1 million as administrative claims, $102.0 million as a priority unsecured claim and $2.9 million as a general unsecured claim. On November 12, 2004, the Company filed its Supplemental Objection to Claims of the IRS, objecting to these additional claims. The Company believes that the IRS’ claims are substantially without merit and intends to defend against them vigorously.

SEC Claim

          On October 17, 2002, the SEC commenced an investigation arising out of the Company’s October 16, 2002 announcement that the Company would restate its 2000 and 2001 financial statements. In October 2002, the Company’s board of directors appointed a special committee which in turn retained the law firm of Skadden, Arps, Slate, Meagher and Flom, LLP for the purpose of performing an internal review concerning the restatement issues and assisting Holdings in its cooperation with the SEC investigation. A Formal Order of Investigation was subsequently issued authorizing the SEC to take evidence in connection with its investigation. The SEC has served several subpoenas on Holdings requiring the production of documents and witness testimony, and the Company has been fully cooperating with the SEC throughout its investigation.

          On October 28, 2004, the SEC issued a Wells Notice to Holdings indicating that the SEC staff is considering recommending to the SEC that it bring a civil action against Holdings alleging that it violated certain financial reporting provisions of the federal securities laws from 1999 to 2002. In addition, the SEC had filed a proof of claim in the amount of $107.0 million, but the SEC has since amended its proof of claim to $15.0 million.

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Holdings is currently engaging in discussions with the SEC regarding the Wells Notice and the possible resolution of this matter, and will continue to cooperate fully with the SEC in respect of the investigation. Any economic consequences of this matter will be treated as a general unsecured claim in the Company’s bankruptcy proceedings.

Equity Distribution

          Shares of Holdings common stock that have been or are to be issued pursuant to the Plan of Reorganization as a result of emergence of the Debtors from bankruptcy are referred to as New Common Stock. Shares of common stock that were outstanding prior to the Effective Date are referred to as Old Common Stock.

          The Plan of Reorganization contemplates the distribution of 17,202,666 shares of New Common Stock to holders of allowed general unsecured claims of Atlas, Holdings, Acquisitions and Logistics on a pro rata basis in the same proportion that each holder’s allowed claim bears to the total amount of all allowed claims. The exact number of shares that each claimholder ultimately receives is dependent on the final total of allowed, unsecured claims and other factors such as unclaimed distributions and fractional share interests.

          In accordance with the Plan of Reorganization, on the Effective Date, Holdings issued and distributed 740,000 shares of the New Common Stock to GE Capital Aviation Services, Inc. (“GECAS”) and 320,000 shares of New Common Stock to certain bank lenders under one loan that was made to Atlas Freighter Leasing III, Inc. (“AFL III”) (the “AFL III Credit Facility”) and another loan made to Atlas (the “Aircraft Credit Facility”). Additionally, pursuant to the terms of the Plan of Reorganization 1,737,334 shares of New Common Stock were offered for subscription and sold to certain Atlas, Holdings, Acquisition and Logistics unsecured creditors. New Common Stock will not be distributed to holders of Polar general unsecured claims since each such holder will receive a fixed cash recovery equal to 60.0% of the amount of their respective allowed claim.

          Excluding the long-term incentive plan and the shares issued to DVB Bank, AG (“DVB”) discussed below, as of June 1, 2005, including the initial distribution described in the preceding paragraph, the Company has 2,797,334 shares issued, or about 15.0% of the approximately 20,000,000 shares to be issued under the Plan of Reorganization.

          The proposed allocation of New Common Stock under the Plan of Reorganization is illustrated in the chart below:

Party	Equity Ownership %			Shares
ACF/AFL III		1.6	%		320,000
GECAS		3.7	%		740,000
General Unsecured Claims		86.0	%		17,202,666
Subscription Shares		8.7	%		1,737,334
Total		100	%		20,000,000

          In addition to the above-referenced shares of New Common Stock allocated above and pursuant to the Plan of Reorganization, as of December 31, 2004, an aggregate of 2,772,559 shares of New Common Stock have been reserved for equity-based awards, of which 610,600 shares of restricted stock and options for 826,663 shares have been issued to directors, management and employees under a management incentive plan and the employee stock option plan.

          In addition, on August 26, 2004, the Bankruptcy Court entered an order approving the issuance of 200,000 shares of New Common Stock to DVB as part of a settlement involving the restructuring of the lease of aircraft tail number N409MC. (See Note 10) These shares were in addition to the original 20,000,000 shares of New Common Stock allocated in the Plan of Reorganization discussed above.

          Distributions of shares of New Common Stock to holders of allowed Senior Notes (defined in Note 10) claims (relating to Atlas’ 10.75% Notes due 2005, 9.375% Notes due 2006, and 9.25% Notes due 2008) will be made to the indenture trustee, which will transmit the shares to the appropriate claimholders in accordance with the plan of Reorganization and the respective indentures. Distributions to holders of other allowed general unsecured claims will be made directly to such claimholders in accordance with the Plan of Reorganization.

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Reorganization Items

          In accordance with SOP 90-7, the Company has segregated and classified certain income and expenses as reorganization items. The following reorganization items were incurred for the period of January 31, 2004 through July 27, 2004:

Legal and professional fees	$	44,209
Rejection of CF6-80 PBH engine agreement (a)		(59,552	)
Claims related to rejection of owned and capital leased aircraft (b)		84,143
Claims related to rejection of aircraft operating leases (c)		42,506
Other		7,782
Fresh-start adjustments		173,598
Gain on cancellation of pre-petition debt		(405,199	)
Total	$	(112,513	)

(a)	The Company rejected a CF6-80 power-by-the-hour engine maintenance agreement and wrote off the associated accrued liability of $59.5 million.
(b)	The Company rejected two owned aircraft, tail numbers N354MC and N535MC, which had been debt financed, and wrote off the assets and liabilities having net book value of $40.0 million. The Company also rejected the capital leases on aircraft tail number N924FT and N518MC and wrote off the assets and liabilities having a net book value of $44.1 million.
(c)	The Company rejected six leased aircraft, tail numbers N507MC, N24837, N922FT, N858FT, N859FTand N923FT that resulted in unsecured claims of $42.5 million.

          Also in accordance with SOP 90-7, interest expense of $21.0 million for the period January 31, 2004 through July 27, 2004, has not been recognized on approximately $437.5 million of Senior Notes (as defined in Note 10 below) as such interest will not be an allowed claim nor paid pursuant to the Plan of Reorganization.

Fresh-Start

          In conjunction with its emergence from bankruptcy, the Company applied the provisions of fresh-start accounting effective as of July 27, 2004, at which time a new reporting entity was deemed to be created.

          Fresh-start accounting requires that the Company revalue its assets and liabilities to estimated fair values at July 27, 2004 in a manner similar to that which would occur if the Company were to apply purchase accounting. Significant adjustments included a reduction in value of its owned aircraft fleet and the recording of additional intangible assets (principally related to Atlas’ACMI customer contracts). In addition, fair-value adjustments were recorded in respect of the Company’s debt and lease agreements. As a result, reported historical financial statements of the Company for periods prior to July 28, 2004 are not comparable with those for periods after July 27, 2004.

          Significant reorganization adjustments in the Balance Sheet result primarily from:

(i)	a reduction in recorded value of flight and ground equipment carrying values;
(ii)	a reduction in recorded value of inventory carrying values;
(iii)	an adjustment for net present value of future lease payments;
(iv)	An adjustment to record intangibles related to ACMI customer contracts and the net present value of lease contracts;
(v)	forgiveness of the Company’s pre-petition debt and the other liabilities; and
(vi)	issuance of Holdings’ New Common Stock pursuant to the Plan of Reorganization;

          These adjustments were based upon the work of the Company and financial consultants and also independent appraisals and anticipated cash flows using the latest available data to management to determine the relative fair values of the Company’s assets and liabilities. Estimates of fair value represent the Company’s best estimate based on the work of independent valuation consultants and, where the foregoing are not available, industry trends and by reference to market rates and transactions. These estimates and the assumptions used by the

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Company and by its valuation consultants, are subject to a number of certain uncertainties and contingencies beyond the Company’s control. If different assumptions were used, the fair values of the Company’s assets and liabilities could be materially increased or decreased.

          The table below reflects reorganization adjustments for the discharge of indebtedness, cancellation of old common stock and issuance of new common stock, issuance of notes, and fresh-start adjustments as of July 27, 2004:

Stockholders (deficit) at July 27, 2004	$	(231,637	)
Cancellation of predecessor common stock and APIC		(306,683	)
Elimination of accumulated deficit		306,719
Fresh-start valuation adjustments		(173,598	)
Gain on cancellation of pre-petition liabilities		405,199
Issuance of common stock to creditors		37,647
Common stock to be issued to creditors		216,069
Stockholders equity at July 27, 2004	$	253,716

          These adjustments are primarily related to the following:

• Liabilities Subject to Compromise:  $405.2 million was recorded as forgiveness of debt to record the discharge of pre-petition accounts payable, accrued liabilities and short and long-term debt.

• Total Stockholders Equity (Deficit):  Adopting fresh-start accounting results in a new reporting entity with no retained earnings or deficit. As a result $306.7 million of Old Common Stock and paid-in-capital and the prior $306.7 million of accumulated deficit was eliminated. All shares of Old Common Stock are cancelled and shares of New Common Stock are issued in lieu thereof pursuant to the terms of the Plan of Reorganization totaling $253.7 million.

          The fresh-start valuation adjustments principally reflect the following:

Current assets	$	(24,696	)
Fixed assets		(267,394	)
Prepaid maintenance		(9,126	)
Intangibles and operating leases		78,213
Prepaid aircraft rent		(88,703	)
Deferred credits and other liabilities		113,125
Long term debt		24,983
	$	(173,598	)

          These adjustments are the result of:

• Current Assets:  $7.3 million reduction adjustment was made to revalue aircraft inventory based on estimated fair market value as it relates to the relative fleet type, a reduction adjustment of $15.1 million for debt issuance costs and a $2.3 million reduction in other current assets.

• Fixed Assets:  A reduction to flight and ground equipment, $346.8 million and $23.7 million respectively, was made to reduce fixed assets to their estimated fair market value, including a $103.1 million elimination of previously recorded accumulated depreciation.

• Prepaid Maintenance:  A reduction in prepaid maintenance costs of $9.1 million to their fair values at July 27, 2004.

• Intangibles and Operating Leases:  An increase in intangibles was recorded in the amount of $78.2 million primarily related to Atlas ACMI Customer Contracts, an unconsolidated equity investment and to record an asset representing the net present value of the revised lease payments which were below market at July 27, 2004, See Note 9.

• Prepaid Aircraft Rent:  $88.7 million was eliminated as a result of the revaluation of operating leases on aircraft to their fair values at July 27, 2004.

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• Deferred Credits and other Liabilities:  An adjustment of $101.9 million was made to record the impact of fresh-start reporting, including the elimination of deferred gains and deferred rent related to operating leases on aircraft and an adjustment was made to other liabilities of $11.2 million.

• Long Term Debt:  An adjustment of $25.0 million was made to adjust the carrying value of long-term debt to reflect fair market value at July 27, 2004.

• Negative Goodwill:  Included in the adjustments above is $234.0 million to allocate negative goodwill against fixed assets of $210.9 million and intangible assets of $23.1 million. The negative goodwill results from the excess fair value of assets over the fair value of the remaining liabilities and “reorganization value” of the new equity and primarily results from debt forgiven of $405.2 million in excess of the $253.7 million value of new equity received by those creditors.

4. Accounting Change

          Effective January 1, 2002, Atlas changed its method of accounting for airframe and engine overhaul activities from the accrual and deferral methods to the direct expense method (with the exception of a fully outsourced B747-400 engine (GE CF6-80C2) service contract, which was accrued on an hourly basis through January 2004 prior to its rejection in the Chapter 11). While the former methods were permitted under United States generally accepted accounting principles (“GAAP”), the Company believes that the direct expense method is preferable, as it more properly reflects the timing of the actual maintenance event and is the predominant method used in the airline industry.

          As a result, the change decreased the Company’s net loss for the year ended December 31, 2002 by $44.6 million and was recorded as a cumulative effect of accounting change. The principal cause of the credit is the treatment of certain power-by-the-hour contract payments as prepayments (versus expense previously) offset, in part, by the write-off of deferred airframe overhauls.

5. Summary of Significant Accounting Policies

     Use of Estimates

          The preparation of financial statements in conformity with GAAP requires management to make estimates and judgments that affect the amounts reported in the Consolidated Financial Statements and footnotes thereto. Actual results may differ from those estimates. Important estimates include asset lives, valuation allowances (including, but not limited to, those related to receivables, inventory and deferred taxes), income tax accounting, self-insurance employee benefit accruals and contingent liabilities.

     Revenue Recognition

          The Company recognizes revenue when a sales arrangement exists, services have been rendered, the sales price is fixed and determinable, and collectibility is reasonably assured.

          Revenue for Scheduled Service and Charter Services is recognized upon flight departure. ACMI contract revenue is recognized as the actual Block Hours are operated on behalf of a customer during a given calendar month.

          Other revenue includes rents from dry leases of owned aircraft and is recognized in accordance with Statement of Financial Accounting Standard (“SFAS”) No. 13, Accounting for Leases.

     Allowance for Doubtful Accounts

          We periodically perform an evaluation of our composition of accounts receivable and expected credit trends and establish an allowance for doubtful accounts for specific customers that we determine to have significant credit risk. Past due status of accounts receivable is determined primarily based upon contractual terms. We provide allowances for estimated credit losses resulting from the inability or unwillingness of our customers to make required payments and charge off receivables when they are deemed uncollectible. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense.

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Cash and Cash Equivalents

          Cash and cash equivalents include cash on hand, demand deposits and short-term cash investments that are highly liquid in nature and have original maturities of three months or less at acquisition.

Restricted funds held in trust

          Restricted funds held in trust represent cash designated for unpaid amounts related to the Polar creditors.

Investments

          The Company holds a minority interest (49%) in a private company, which is accounted for under the equity method.

          The December 31, 2004 and 2003 aggregate carrying value of the investment of $17.5 million and $2.7 million, respectively, is included within Deposits and other assets on the consolidated balance sheet.

          The increase resulted from the fair value assigned to our 49% investment, as a result of fresh-start accounting and the underlying equity in the net assets of the business has been allocated to intangible assets. These assets relate to their airline operating certificate and finite lived intangible assets related to existing customer contracts. Fair value of this investment was determined by an independent appraisal. The finite lived intangible asset is amortized on a straight-line basis over the three year estimated life of the contracts.

Inventories

          Spare parts, materials and supplies for flight equipment are carried at average acquisition cost, which are expensed when used in operations and are included in prepaid expenses and other current assets in the consolidated balance sheet. Rotable parts are written off when beyond economic repair. At December 31, 2004 and 2003, the reserve for expendable obsolescence was zero and $1.4 million, respectively. Allowances for obsolescence for spare parts expected to be on hand at the date aircraft are retired from service, are provided over the estimated useful lives of the related aircraft and engines. Allowances are also provided for spare parts currently identified as excess or obsolete. These allowances are based on management estimates, which are subject to change as conditions in our business evolve. Rotable inventory is recorded in “Property and Equipment”.

Property and Equipment

          The Company records its property and equipment at cost and depreciates these assets on a straight-line basis over their estimated useful lives to their estimated residual values, over periods not to exceed forty years for flight equipment (from date of original manufacture) and three to five years for ground equipment, from the date the asset is placed in service. Property under capital leases and related obligations are recorded at the lesser of an amount equal to (a) the present value of future minimum lease payments computed on the basis of the Company’s incremental borrowing rate or, when known, the interest rate implicit in the lease or (b) the fair value of the asset. Amortization of property under capital lease is on a straight-line basis over the lease term unless ownership takes place or a purchase option exists and is included in depreciation expense. In that case, amortization is over the remaining life of the aircraft from date of manufacture.

          Expenditures for major additions, improvements and flight equipment modifications are generally capitalized and depreciated over the shorter of the estimated life of the improvement or the modified assets remaining lives or remaining lease term in the event that any modifications or improvements are made to operating lease equipment. Substantially all property and equipment is specifically pledged as collateral for indebtedness of the Company.

Measurement of Impairment of Long-Lived Assets and Intangible Assets Subject to Amortization

          When events and circumstances indicate that assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets, the Company records impairment losses with respect to those assets.

          The impairment charge is determined based upon the amount by which the net book value of the assets exceeds their estimated fair value. In determining the fair value of the assets, the Company considers market trends, published values for similar assets, recent transactions involving sales of similar assets or quotes from third party appraisers. In making these determinations, the Company also uses certain assumptions, including, but

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not limited to, the estimated discounted future cash flows expected to be generated by these assets, which are based on additional assumptions such as asset utilization, length of service the asset will be used in the Company’s operations and estimated residual values.

Intangible Assets

          Route acquisition costs primarily include operating rights (takeoff and landing slots) at Narita Airport in Tokyo, Japan. Airline operators certificates (“AOCs”) represent the allocated value of existing licenses to operate aircraft in commercial service. “Flight Authorities” represent the allocated value of legal rights, regulatory permits, and airport landing slots required for a scheduled airline to serve international markets. Since each of these operating rights is considered to have an indefinite life, no amortization has been recorded.

          ACMI customer contracts represent the future profits expected from customer contracts on hand as of the Effective Date. Fair market value operating leases represents the capitalized discount recorded to adjust leases of the Company’s Boeing 747 aircraft to fair market value as of the Effective Date. It is an asset as certain operating lease rates (primarily 747-400’s) were below market at that date.

          Under SFAS No.142, Goodwill and Other Intangible Assets (“SFAS No. 142”), intangibles with indefinite lives are not amortized but reviewed for impairment annually, or more frequently, if impairment indicators arise. The carrying value and ultimate realization of these assets is dependent upon estimates of future earnings and benefits that the Company expects to generate from their use. If the Company’s expectations of future results and cash flows change and are significantly diminished, intangible assets may be impaired and the resulting charge to operations may be material. The estimation of useful lives and expected cash flows requires the Company to make significant judgments regarding future periods that are subject to some factors outside its control. Changes in these estimates can result in significant revisions to the carrying value of these assets and may result in material changes to the results of operations. The estimated life of the Route acquisition costs, AOCs, and Flight Authorities is indefinite. Intangibles with definite lives are amortized over their respective useful lives, which are as follows:

ACMI customer contracts	up to 5 years, customer by customer
Fair market value operating leases	21 years

Concentration of Credit Risk and Significant Customers

          The U.S. military Airlift Mobility Command (“AMC”) charters accounted for 18.6% of the Company’s total revenues for the period July 28 through December 31, 2004, 21.2% of total revenues for the period January 1 through July 27, 2004, and 31.1%, and 19.6% for the years ended December 31, 2003, and 2002, respectively. No other customer accounted for 10.0% or more of the Company’s total operating revenues during these periods. Accounts receivable from the U. S. Military were $17.3 million and $15.3 million at December 31, 2004 and 2003, respectively.

Income Taxes

          We provide for income taxes using the asset and liability method. Under this method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. If necessary, deferred income tax assets are reduced by a valuation allowance to an amount that is determined to be more likely than not recoverable. We must make significant estimates and assumptions about future taxable income and future tax consequences when determining the amount of the valuation allowance. In addition, tax reserves are based on significant estimates and assumptions as to the relative filing positions and potential audit and litigation exposures thereto. The effect on deferred taxes of a change in tax laws or tax rates is recognized in the results of operations in the period that includes the enactment date.

Debt Issuance Costs

          Costs associated with the issuance of debt are capitalized and amortized over the life of the respective debt obligation, using the effective interest method for amortization. Amortization of debt issuance costs was zero for the period July 28, 2004 through December 31, 2004, $5.2 million for the period January 1, 2004 through July 27, 2004, and $4.2 million, and $4.1 million, for the years ended December 31, 2003, and 2002 respectively, and is included as a component of interest expense on the Consolidated Statements of Operations.

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     Aircraft Maintenance and Repair

          Maintenance and repair cost for both owned and leased aircraft are charged to expense as incurred, except Boeing 747-400 engine (GE CF6-80C2) overhaul costs through January 2004. These were performed under a fully outsourced power-by-the-hour maintenance agreement. The costs thereunder are accrued based on the hours flown. This contract was rejected in the Chapter 11 Cases.

     Foreign Currency transactions

          The Company’s results of operations are exposed to the effect of foreign exchange rate fluctuations on the U.S. dollar value of foreign currency denominated operating revenues and expenses. The Company’s largest exposure comes from the British pound, the Euro, the Japanese yen and various Asian currencies. The Company does not currently have a foreign currency hedging program related to its foreign currency-denominated sales. Gains or losses resulting from foreign currency transactions are included in non-operating expenses and have not been significant to our operating results for any period.

     Stock-Based Compensation

          The Company accounts for its stock-based employee compensation plans under the recognition and measurement principles of Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees and its related interpretations (“APB 25”). The Company had adopted the disclosure only provisions of SFAS No. 123, Accounting for Stock-Based Compensation (“SFAS No. 123”), as amended by SFAS No. 148, Accounting for Stock-Based Compensation—Transition and Disclosure (“SFAS No.148”). Had the Company elected to adopt the fair value recognition provisions of SFAS No. 123 and SFAS No.148, pro forma net income (loss) and income (loss) per share for the periods presented, would be as follows (in thousands, except for per share data):

	Successor			Predecessor
	For the Period July 28, 2004 Through December 31, 2004			For the Period January 1, 2004 Through July 27, 2004			For the Year Ended December 31, 2003			For the Year Ended December 31, 2002
Net income (loss), as reported	$	22,710		$	28,246		$	(100,990	)	$	(53,813	)
Add: Restricted stock expense		854			—			—			—
Deduct: Total stock-based employee compensation expense determined under fair value based method for all awards		(1,112	)		(4,618	)		(6,043	)		(8,186	)
Pro forma net income (loss)	$	22,452		$	23,628		$	(107,033	)	$	(61,999	)
Basic income (loss) per share:
Basic—as reported	$	1.12		$	0.74		$	(2.63	)	$	(1.41	)
Basic—pro forma	$	1.11		$	0.62		$	(2.79	)	$	(1.62	)
Diluted income (loss) per share:
Diluted—as reported	$	1.11		$	0.74		$	(2.63	)	$	(1.41	)
Diluted—pro forma	$	1.10		$	0.62		$	(2.79	)	$	(1.62	)

          The weighted average fair value of the options granted during the period July 28 through December 31, 2004, and the years 2003 and 2002 was $4.99, $1.16, and $2.99, respectively. There were no options granted during the period January 1 through July 27, 2004. The fair value was estimated using the Black-Scholes option pricing model with the following weighted average assumptions:

	Successor			Predecessor
Assumptions	2004			2003			2002
Expected dividend yield		None			None			None
Risk-free interest rate		2.93	%		3.01	%		3.59	%
Expected life of option grants		3 years			4 years			4 years
Expected volatility		38.5	%		118.65	%		93.88	%

          On the Effective Date, the Company’s existing stock-based employee compensation plans were terminated and all outstanding options and restricted stock were cancelled.

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     Supplemental Cash Flow Information

          The aggregate interest payments amounted to $23.8 million for the period July 28, through December 31, 2004, $24.1 million for the period January 1, through July 27, 2004 and $49.8 million and $86.7 million for the years ended December 31, 2003 and 2002, respectively. The Company received federal and state income tax refunds (net of payments) of approximately $37.1 million and $27.0 million in the years ended December 31, 2003 and 2002, respectively.

          The Company paid reorganization costs of $44.2 million for the period January 1, through July 27, 2004.

          The Company acquired flight equipment through the utilization of debt in non-cash transactions in the amounts of $205.0 million and $151.6 million for the period January 1, 2004 through July 27, 2004 and for the year ended December 31, 2003, respectively. The Company had a non-cash conversion of $405.2 million of debt to equity of $233.5 million for the period January 1, through July 27, 2004.

     Reclassifications

          Certain reclassifications have been made in the prior year’s consolidated financial statement amounts and related note disclosures to conform to the current year’s presentation.

     Recently Issued Accounting Standards

          In December 2004, the Financial Accounting Standards Board (“FASB”) issued Statement No. 123 (revised 2004), “Share-Based Payment” (“FAS 123R”), which replaces FAS 123 and supersedes APB 25. FAS 123R requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based upon their fair values, beginning with the first interim or annual period after June 15, 2005, with early adoption encouraged. On April 14, 2005, the SEC decided to delay the implementation date to the beginning of the first fiscal year beginning after December 15, 2005. The Company has the option to choose either the modified prospective or modified retrospective method. The Company expects to adopt FAS 123R in the first quarter of 2006, using the modified prospective method of adoption which requires that compensation expense be recorded over the expected remaining life of all unvested stock options and restricted stock and for any new grants thereof at the beginning of the first quarter of adoption of FAS 123R. We are currently evaluating the impact FAS 123R will have on the Company, and based on our preliminary analysis, expect to incur additional compensation expense, as a result of the adoption of this new accounting standard that may be material to the 2006 financial statements.

          See Note 3 above for more information on the Successor Company’s equity structure and Note 18 below for more information on stock-based compensation.

     Consolidation of Variable Interest Entities

          In December 2003, the FASB revised Interpretation No. 46, Consolidation of Variable Interest Entities, an Interpretation of ARB No. 51 (“FIN 46”) (“FIN 46-(R)”), delaying the effective date for certain entities created before February 1, 2003 and making other amendments to clarify the application of the guidance. The Company has adopted FIN 46 for entities created subsequent to January 31, 2003 as of December 31, 2003 and adopted FIN 46-(R) as of the end of the interim period ended March 31, 2004. The adoptions of FIN 46 and FIN 46-(R) did not result in the consolidation of any variable interest entities.

          Twelve of the Company’s forty-three operating aircraft are owned and leased through trusts established specifically to purchase, finance and lease aircraft to the Company. These leasing entities meet the criteria for variable interest entities. All fixed price options were restructured to reflect a fair market value purchase option, and as such, the Company is not the primary beneficiary of the leasing entities. The Company is generally not the primary beneficiary of the leasing entities if the lease terms are consistent with market terms at the inception of the lease and the leases do not include a residual value guarantee, fixed-price purchase option or similar feature that obligates the Company to absorb decreases in value or entitles the Company to participate in increases in the value of the aircraft. The Company has not consolidated the related trusts upon application of FIN 46 because the Company is not the primary beneficiary based on the option price restructurings. The Company’s maximum exposure under these leases is the remaining lease payments, which amounts are reflected in future lease commitments described in Note 9.

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6. Impairment Charge

          In the second quarter of 2002, due to further declines in the fair value of six aircraft previously deemed held for sale, the Company recorded an additional impairment charge of $7.9 million, which is included in depreciation expense on the Consolidated Statement of Operations. Among other sources, the Company used third party appraisals and published values for similar aircraft to assess the fair values of each specific aircraft. After 12 months, the Company was unsuccessful in its efforts to sell or otherwise dispose of these six Boeing747 aircraft, and in accordance with SFAS No. 144, the Company placed the aircraft previously classified as held for sale back into operating status. These aircraft are being depreciated, beginning July 2002, over their remaining lives ranging from 18 months to 13 years.

7. Investments

          At December 31, 2003, the Company held a restricted guaranteed investment contract in the amount of $26.0 million. In 2004, an aircraft lessor exercised its rights due to a rent payment default on aircraft N496MC and drew down on the guaranteed investment contracts in the amount of $26.0 million (see Note 10).

8. Property and Equipment

          Property and equipment consisted of the following:

	Successor			Successor			Predecessor
	Useful Lives			2004			2003
Flight equipment		4.8-35.3 years	*	$	607,184		$	833,079
Ground equipment and buildings		0.2-18.0 years			13,541			40,783
Total					620,725			873,862
Less accumulated depreciation					(10,971	)		(78,768	)
Property, plant, and equipment—net				$	609,754		$	795,094

* The Successor useful lives for Boeing 747-200 aircraft range from 4.8 years to 20.3 years and the Boeing 747-400 aircraft range from 33.5 years to 35.3 years

          Depreciation expense, including the amortization of capital leases, related to property and equipment amounted to $23.0 million for the period July 28, through December 31, 2004, $33.5 million for the period January 1, through July 27, 2004, and $60.1 million and $54.4 million for the years ended December 31, 2003 and 2002, respectively. The Company had equipment related to capital leases of $24.8 million and $64.2 million at December 31, 2004 and 2003, respectively, and accumulated amortization was $1.6 million and $6.9 million, respectively for such years.

9. Intangible Assets

          The following tables present the Company’s intangible assets as of December 31:

	Successor			Predecessor
	2004			2003
Indefinite life:
Route acquisition costs	$	36,069		$	42,238
Airline operating certificates	$	3,426			—
Flight Authorities		1,187			—
	$	40,682		$	42,238
Finite life:
ACMI customer contracts		21,856			—
Fair market value adjustment/operating leases		44,132			—
Less accumulated amortization		(3,230	)		—
		62,758			—
Total intangible assets	$	103,440		$	42,238

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          Amortization expense related to ACMI customer contracts and lease contracts amounted to $3.2 million for the period July 28, through December 31, 2004.

          The estimated future amortization expense of ACMI customer contracts and lease contracts for the years ended December 31 is as follows:

	ACMI Customer Contracts		FMV Operating Leases		Total
2005	$	9,956	$	1,834	$	11,790
2006		6,256		1,834		8,090
2007		2,178		1,834		4,012
2008		634		1,834		2,468
2009		366		1,834		2,200
Thereafter		—		34,198		34,198
	$	19,390	$	43,368	$	62,758

10. Debt

          The Company’s debt obligations, including capital leases, as of December 31 were as follows:

	Successor			Predecessor
	2004			2003
Debt Obligations
Aircraft Credit Facility	$	35,024		$	43,578
AFL III Credit Facility		138,254			162,856
9 1/4% Senior Notes due 2008		—			152,886
9 3/8% Senior Notes due 2006		—			147,000
10 3/4% Senior Notes due 2005		—			137,475
2000 EETCs		71,571			59,916
1999 EETCs		135,018			87,258
1998 EETCs		200,530			73,470
Capital leases		36,717			52,270
Other Debt		21,955			47,848
Total debt and capital Leases		639,069			964,557
Less current portion of debt and capital leases		(36,084	)		(964,557	)
Long-term debt and capital leases	$	602,985		$	—

          At December 31, 2004, the Company had $123.4 million of unamortized discount related to the fair market value adjustments recorded against debt upon application of fresh-start accounting. See Note 21 below.

     Description of the Company’s Debt Obligations

          The following paragraphs provide a summary of the treatment in the Consolidated Financial Statements for the restructuring of the Company’s debt obligations and changes that have occurred as a result of the Chapter 11 Cases. It should be noted that, for accounting purposes, the restructuring described below was given effect upon entering into binding term sheets with the respective lender or lessor as the parties to such agreements were operating under the revised terms of the agreements as if they were completed. In certain instances the agreements only became legally binding on the Effective Date or upon the occurrence of certain events after such date.

          Many of our financing instruments contain certain limitations on Holdings and its subsidiaries’ ability to, among other things: incur additional indebtedness, enter into leases, make capital expenditures, pay dividends or make certain other restricted payments, consummate certain asset sales, incur liens, sell or issue preferred stock of subsidiaries to third parties, merge or consolidate with any other person, or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of their assets.

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     Deutsche Bank Trust Company

          Deutsche Bank Trust Company (“Deutsche Bank”) is the administrative agent for two syndicated loans to Atlas and its affiliates. One loan was made to AFL III ( a wholly owned subsidiary of Atlas) and the other loan was made through the Aircraft Credit Facility. The obligations under these two credit facilities are secured by 15 Boeing 747-200’s and one Boeing 747-300 aircraft and several spare General Electric CF6-50E2 and CF6-80 engines. AFL III leases the collateral securing the AFL III Credit Facility, including aircraft and related equipment, to Atlas. AFL III has collaterally assigned those leases and the proceeds thereof to Deutsche Bank as security for the AFL III Credit Facility.

          Atlas, AFL III, Deutsche Bank, as administrative agent, and a majority of the lenders comprising the bank group under each credit facility, executed forbearance agreements dated July 3, 2003, which contained the terms of the initial loan restructurings. In January, February and March 2004, the parties entered into letter agreements that further amended the original forbearance agreements (as amended, the “Forbearance Agreements”).

     Aircraft Credit Facility

          Under the Forbearance Agreement, with respect to the Aircraft Credit Facility, the lenders agreed to accept lower monthly principal payments over a longer term. As additional consideration for the restructuring, the lenders under the Aircraft Credit Facility received, among other things, (i) 66,800 shares of New Common Stock and (ii) guarantees of the loan obligations from Holdings and its affiliates upon confirmation of the Plan of Reorganization. Atlas and the ACF lenders executed an amended and restated credit agreement on July 27, 2004.

          On November 30, 2004, Holdings and Atlas entered into amendments (the “ACF Amendments”) to the Aircraft Credit Facility by and among Atlas, the lenders party thereto and Deutsche Bank. The ACF Amendments increased the capital expenditure limitations included in the Aircraft Credit Facility to $25 million (from $20 million), subject to certain adjustments.

          The Aircraft Credit Facility is secured by a first priority security interest in one Boeing 747-300 aircraft (tail number N355MC) and two Boeing 747-200 aircraft (tail numbers N536MC and N540MC).

          The weighted average interest rate under the Aircraft Credit Facility for the years ended December 31, 2004 and 2003 was 5.59% and 6.97%, respectively. The year end rate as of December 31, 2004 and 2003 is 6.73% and 5.90%, respectively.

     AFL III Credit Facility

          Under the Forbearance Agreement, the AFL III lenders agreed to accept lower monthly principal payments over a longer term including a deferral of up to $20.3 million in principal payments otherwise due in 2004 and early 2005, provided that Atlas performs certain maintenance events on the aircraft collateral during such period. The deferred amount is due December 31, 2009, unless Atlas exceeds certain financial targets, in which case part of the deferred amount may become due earlier. AFL III and its lenders executed an amended and restated credit agreement on July 27, 2004. As additional consideration for the restructuring, the lenders under the AFL III Credit Facility received 253,200 shares of New Common Stock to be issued under the Plan of Reorganization

          The AFL III Credit Facility is secured by a first priority security interest in thirteen Boeing 747-200F aircraft, plus nine spare CF6-50E2 engines and three CF6-80C engines. The aircraft tail numbers securing the AFL III Credit Facility as of December 31, 2004 and 2003 were: N505MC, N509MC, N512MC, N517MC, N522MC, N523MC, N524MC, N526MC, N527MC, N528MC, N534MC, N808MC and N809MC.

          On November 30, 2004, AFL III entered into an amendment (the “AFL III Amendment”) to the AFL III Credit Facility. The AFL III Amendment increased the annual capital expenditure limitations included in the AFL III Credit Facility to $25 million subject to certain adjustments. Fifteen leases relating to the thirteen aircraft and two engine pools from AFL III to Atlas pursuant to the AFL III Credit Facility were also amended to comply with the AFL III Amendments.

          The weighted average interest rate for the years ended December 31, 2004 and 2003 are 5.88% and 6.06%, respectively. The year end rate as of December 31, 2004 and 2003 is 6.96% and 6.03%, respectively.

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     Senior Notes

          The various senior notes issued by Atlas (collectively, the “Senior Notes”) as of September 30, 2004, in the aggregate principal amount of $437.5 million, were general unsecured obligations of Atlas, which ranked pari passu in right of payment to any of Atlas’ existing and future unsecured senior indebtedness. Interest on the Senior Notes was payable semi-annually in arrears; however, no interest payments were made after March 28, 2003. The Senior Notes were cancelled under the Plan of Reorganization on the Effective Date and are entitled to receive a significant portion of the New Common Stock pursuant to the plan of Reorganization (See Note 3 above).

Enhanced Equipment Trust Certificate Transactions

     Overview of EETC Transactions

          In three separate transactions in 1998, 1999 and 2000, Atlas issued pass-through certificates, also known as Enhanced Equipment Trust Certificates (“EETCs”). These securities were issued for the purposes of financing the acquisition of a total of 12 Boeing 747-400 aircraft. In the 1998 EETC transaction, $538.9 million of EETCs were issued to finance five of these aircraft, one of which Atlas then owned, with the remaining four being leased by Atlas pursuant to leveraged leases. In the 1999 EETC transaction, $543.6 million of EETCs were issued to finance five of these aircraft, one of which Atlas then owned, with the remaining four being leased by Atlas pursuant to leveraged leases. In the 2000 EETC transaction, $217.3 million of EETCs were issued to finance the remaining two of these aircraft, both pursuant to leveraged leases. Historically, the debt obligations relating solely to owned EETC aircraft have been reflected on the Company’s balance sheet while the debt obligations related to the leased EETC aircraft have not been reflected on the Company’s balance sheet because such obligations previously constituted operating leases. Through the restructuring however, Atlas became the beneficial owner of four of the previously leased aircraft (see Restructuring of EETCs below) resulting in a total of six aircraft reflected on the Company’s balance sheet.

     Leverage Lease Structure

          In a leveraged lease, the owner trustee is the owner of record for the aircraft. Wells Fargo Bank Northwest, National Association (“Wells Fargo”) serves as the owner trustee with respect to the leveraged leases in each of Atlas’s EETC transactions. As the owner trustee of the aircraft, Wells Fargo serves as the lessor of the aircraft under the EETC lease between Atlas and the owner trustee. Wells Fargo also serves as trustee for the beneficial owner of the aircraft, the owner participant. The original owner participant for each aircraft invested (on an equity basis) approximately 20% of the original cost of the aircraft. The remaining approximately 80% of the aircraft cost was financed with debt issued by the owner trustee on a non-recourse basis in the form of equipment notes.

          The equipment notes were generally issued in three series, or “tranches,” for each aircraft, designated as Series A, B and C equipment notes. The loans evidenced by the equipment notes were funded by the public offering of EETCs. Like the equipment notes, the EETCs were issued in three series for each EETC transaction designated as Series A, B and C EETCs. Each class of EETCs was issued by the trustee for separate Atlas Pass Through Trusts with the same designation as the class of EETCs issued. Each of these Pass Through Trustees is also the holder and beneficial owner of the equipment notes bearing the same class designation.

          With respect to the two EETC financed aircraft previously and currently owned by Atlas, there is no leveraged lease structure or EETC lease. Atlas is the beneficial owner of the aircraft and the issuer of the equipment notes with respect thereto. The equipment notes issued with respect to the owned aircraft are with full recourse to Atlas.

     Restructuring of EETCs

          On September 12, 2003, the Company and a majority in interest of its Class A EETC holders from the 1998, 1999 and 2000 EETC transactions entered into three restructuring agreements, one for each then existing EETC transaction. Each restructuring agreement was subsequently amended as of November 4, 2003, December 15, 2003, February 5, 2004 and March 31, 2004. As of February 5, 2004, the Company also entered into a term sheet (the “OP Term Sheet”) with the owner participants with respect to six of the ten aircraft leased under the EETC transactions. Each of the restructuring agreements, together with the OP Term Sheet, are collectively referred to herein as the “EETC Restructuring Agreements”.

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          Pursuant to the EETC Restructuring Agreements, the aircraft leases were amended to provide for basic rent of $725,000 per month for the first sixty months beginning on January 1, 2003, and basic rent of $830,000 per month thereafter, until the equipment notes underlying the EETCs are paid or satisfied in full, subject to adjustment during 2005 for repayment of a $23.0 million EETC deferred rent obligation. The equipment notes underlying the EETCs relating to two aircraft which were owned originally by Atlas will be amortized based on the same monthly payment amounts as the leased aircraft. The term of the leases and equipment notes underlying the EETCs were generally extended to fully amortize the underlying equipment notes on the leased aircraft and the owned aircraft. A number of factors can affect the timing of payments to the EETCs, including the appraised value and the future appraised fair market lease rates for the aircraft underlying the EETC and any sale of an aircraft pursuant to the terms of the EETC Restructuring Agreements and the financial performance of the Company. For example, the Class C EETCs were originally scheduled to be paid first, followed by the Class B EETCs and then the Class A EETCs. Following a triggering event caused by the Company’s bankruptcy filing and the adjustments to payments as a result of appraised values of the EETC aircraft, it is now expected that on an average life basis, the Class A EETCs will generally be paid first, followed by the Class B EETCs and then the Class C EETCs. Total yield on the EETCs will be affected by the changes in timing of their payments.

          Under the terms of the EETC Restructuring Agreements, once the EETCs from any of the EETC transactions are paid in full, any remaining balances on the related underlying equipment notes will be forgiven.

          The EETC Restructuring Agreements provide that, for the leased aircraft underlying the EETCs, lease payments will continue following payment or forgiveness of the related underlying equipment notes. This so called “equity rent” is paid to the owner trust and distributed to the owner participant. Equity rent provides an economic return to the owner participants based on their original investment in the aircraft, in addition to the residual value of the aircraft and any tax benefits related to ownership. Prior to their restructuring, the EETC transactions had provided for periodic payments of equity rents over the term of the leases of the aircraft underlying the EETCs. Pursuant to the EETC Restructuring Agreements, all equity rents are delayed until payment of the related underlying equipment notes, or their forgiveness following payment of the EETCs. Pursuant to the OP Term Sheet, adjusted rent schedules providing equity rents and lease extensions were negotiated with respect to several leased aircraft in the EETC transactions. The lease agreements relating to those aircraft were filed with the Bankruptcy Court in connection with Stipulations under Section 1110(b) of the Bankruptcy Code as to such aircraft.

          In addition, pursuant to the EETC Restructuring Agreements, Atlas has entered into airframe and engine maintenance agreements applicable to the aircraft underlying the EETCs.

          Concurrent with the consummation of the Revolving Credit Facility and related events described above, certain amendments to the Company’s EETC agreements, as described in the Company’s Second Amended Disclosure Statement Under 11 U.S.C. §1125 in Support of the Debtors’ Plan of Reorganization, automatically took effect on November 30, 2004.

     2000 EETCs

          In April 2000, Atlas completed an offering of $217.3 million of Enhanced Equipment Trust Certificates (“2000 EETCs”). The cash proceeds from the 2000 EETCs were used to finance (through two leveraged lease transactions) two new 747-400 freighter aircraft which were delivered to Atlas during the second quarter of 2000. Subsequent to the financing, Atlas completed a sale-leaseback transaction on both aircraft and issued a guarantee to the owner participant of one of the aircraft. In connection with this secured debt financing, Atlas executed equipment notes with original interest rates ranging from 8.71% to 9.70%, with a weighted average interest rate of 8.93% payable monthly as of December 31, 2004, and previously payable semi-annually.

          In July 2003, Atlas defaulted on the lease payments with respect to an aircraft leased in the 2000 EETC transaction, tail number N409MC (“N409MC”), and, as a result, the owner participant for such aircraft liquidated collateral that secured its owner participant interest. This collateral consisted of a $22.6 million guaranteed investment contract and a $15.4 million letter of credit. The letter of credit was issued by DVB Bank AG (“DVB”) and guaranteed by Atlas, resulting in DVB becoming the new owner participant when it was drawn and funded to the original owner participant.

          During the Company’s Chapter 11 Cases, various disputes arose between Atlas and DVB concerning the claim asserted by DVB for reimbursement of the amounts DVB paid under the letter of credit (the “DVB Claim”)

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and the contemplated restructuring of the obligations related to N409MC. These disputes ultimately resulted in the commencement of legal proceedings involving Atlas and DVB.

          Shortly after confirmation of the Plan of Reorganization, Atlas and DVB reached a settlement of their pending disputes, which settlement was memorialized in the Binding Term Sheet Agreement Regarding Atlas B747-400F Aircraft N409MC (the “DVB Term Sheet”). This compromise paved the way for the contemplated restructuring of the 2000 EETC Transaction. The Bankruptcy Court entered an order approving the compromise embodied in the DVB Term Sheet on August 16, 2004. The Company accounted for such settlement on the Effective Date. The following is a summary of the material terms of the DVB Term Sheet, all of which have been consummated by the parties:

a.	DVB sold its owner participant interest (the “OP Interest”) in N409MC to Atlas pursuant to the terms and conditions outlined in the DVB Term Sheet. The purchase price for the OP Interest was $11.5 million, consisting of a $9 million unsecured promissory note (the “409 OP Note”) plus 200,000 shares of New Common Stock. The principal amount of the 409 OP Note is payable in equal quarterly installments commencing on October 2, 2004, with the final installment due on July 2, 2011. The 409 OP Note bears interest on the principal amount at an annual rate equal to the 3-month LIBOR rate plus 475 basis points, and will be adjusted quarterly in accordance with the 3-month LIBOR rate in effect on each interest determination date. The 409 OP Note is guaranteed by Holdings and Polar;
b.	DVB, Atlas, and certain third parties dismissed the legal proceedings that were pending among them;
c.	Atlas released DVB from any claims it might have for the period before the closing of the purchase of the OP Interest (the “OP Closing”). DVB and Atlas released any claims (including tax indemnity claims) they may have against each other, their respective officers, directors, employees, attorneys, and representatives arising out of or in connection with (i) the purchase transaction other than the payment obligations evidenced by the OP Note and any sales or transfer taxes, which shall be Atlas’s responsibility; (ii) any prior Atlas payment default; and (iii) any prior acts or omissions of Atlas or DVB or their respective officers, directors, employees, attorneys, and representatives; and
d.	DVB was allowed a general unsecured claim under the Plan of Reorganization in the amount of $16,802,557.42 on account of the DVB Claim, which represents approximately 444,690 shares of New Common Stock.

          The table below summarizes the fair market value of the obligations recorded for the aircraft at July 27, 2004

Aircraft Tail Number	Description	Fair Value of the Debt and stock at Date of Modification
N409MC	EETC Note A	$	51,528
	EETC Note B		7,833
	EETC Note C		2,147
	409 OP Note		9,000
	New Common stock		8,104
	Total	$	78,612

          In connection with this financing, the Company has a blended effective interest rate of 11.31% and 14.86% as of December 31, 2004 and 2003, respectively, payable monthly. According to the terms of the equipment notes, principal payments vary and are payable through 2021.

          As contemplated under the DVB Term Sheet, holders of the majority of Senior Notes purchased the 409 OP Note and the 200,000 shares from DVB for $9,000,000 in cash. This sale of the 409 OP Note and the shares to third parties was concluded as part of the transactions that closed at the OP Closing.

     1999 EETCs

          In 1999, Atlas completed an offering of Enhanced Equipment Trust Certificates (“1999 EETCs”). As of December 31, 2004 the outstanding balance of the 1999 EETCs relate to two owned Boeing 747-400F aircraft numbers N495MC and N496MC. As of December 31, 2003, the outstanding balance of the 1999 EETCs relate to

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one owned Boeing 747-400F aircraft number N495MC. In connection with this secured debt financing, Atlas executed equipment notes with original interest rates ranging from 6.88% to 8.77%, with a weighted average interest rate of 7.52% and 7.43% payable monthly as of December 31, 2004, and previously payable semi-annually.

          The owner participant with respect to one of the aircraft leased in the 1999 EETC transaction (tail number N496MC) liquidated the $26.0 million guaranteed investment contact that was collateral for the financing in August 2003. Subsequently, on January 30, 2004 the owner participant transferred its owner participant interest to Bankers Commercial Corporation (“BCC”). At the same time, Atlas acquired an option (which was subsequently exercised in August, 2004) to purchase the owner participant interest from BCC at any time prior to December 31, 2007, subject to earlier termination. In connection with that option transaction, BCC agreed to support and consent to the restructuring contemplated by the EETC Restructuring Agreement relating to the 1999 EETC transaction and incorporated by reference certain provisions of the OP Term Sheet. The changes to the owner participant described above resulted in Atlas effectively acquiring the aircraft on January 30, 2004 with the asset and related liabilities being recorded on the balance sheet at their respective fair values. In connection with this financing, the Company has a blended effective interest rate of 13.94%. According to the terms of the equipment notes, principal payments vary and are payable monthly through 2020. The table below summarizes the fair market value of the obligations recorded for the aircraft at January 30, 2004:

Aircraft Tail Number	Description	Fair Value of the Debt at Date of Modification
N496MC	EETC Note A	$	50,054
	EETC Note B		9,429
	EETC Note C		5,562
	Total	$	65,045

     1998 EETCs

          In 1998, Atlas completed an offering of Enhanced Equipment Trust Certificates (the “1998 EETCs”). As of December 31, 2004 the outstanding balance of the 1998 EETCs relates to three owned B747-400F aircraft numbers N491MC, N493MC and N494MC. As of December 31, 2003, the outstanding balance of the 1998 EETCs relates to one owned B747-400F aircraft number N494MC. In connection with this secured debt financing, Atlas executed equipment notes with original interest rates ranging from 7.38% to 8.01%, with a weighted average interest rate of 7.54% and 7.48% payable monthly as of December 31, 2004, and previously payable semi-annually.

          Pursuant to the Plan of Reorganization, as of January 30, 2004, FINOVA Capital Corporation (“FINOVA”), the owner participant with respect to two leased aircraft in the 1998 EETC transaction, sold its owner participant interests in such aircraft to Atlas for $5.0 million each, payable in installments over a ten year term commencing in 2007, (the “491 and 493 OP Notes”). In connection with this transaction, FINOVA agreed to support and consent to the restructuring contemplated by the EETC Restructuring Agreement relating to the 1998 EETC transaction (relating to aircraft tail numbers N491MC and NM493MC). The changes to the owner participant described above resulted in both aircraft being effectively acquired by Atlas on January 30, 2004 with the asset and related liabilities being recorded on the balance sheet at their respective fair values. The Company has a blended effective interest rate of 13.89% for aircraft tail number N491MC and according to the terms of the equipment notes, principal payments vary and are payable monthly through 2020. The Company has a blended effective interest rate of 13.72% for aircraft tail number N493MC and according to the terms of the equipment notes, principal payments vary and are payable monthly through 2019.

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          The table below summarizes the fair market value of the obligations recorded for both aircraft at January 30, 2004

Aircraft Tail Number	Description	Fair Value of the Debt at Date of Modification
N491MC	EETC Note A	$	49,465
	EETC Note B		10,195
	EETC Note C		5,625
	491 OP Note		5,000
	Total	$	70,285
N493MC	EETC Note A	$	49,626
	EETC Note B		10,200
	EETC Note C		4,706
	493 OP Note		5,000
	Total	$	69,532

     Capital Leases

          Capital lease obligations with an aggregate net present value of $36.7 million and $52.3 million were outstanding at December 31, 2004 and 2003, respectively. The weighted average interest rate as of December 31, 2004 and 2003 is 7.16% and 20.57%, respectively. The effective interest rate was reset in conjunction with the fair value exercise required by fresh-start accounting. Payments are due monthly through 2009. The underlying assets related to capital lease obligations as of December 31, 2004 were three aircraft and a flight simulator. The aircraft tail numbers are N508MC, N516MC, and N920FT. During the year ended December 31, 2004, N924FT and N518MC were rejected in bankruptcy. During 2004, the capital leases for tail numbers N508MC and N516MC were amended. The underlying assets related to capital lease obligations as of December 31, 2003 were five aircraft and a flight simulator. The aircraft tail numbers are N508MC, N516MC, N518MC, N920FT and N924FT.

     Other Debt

          Other debt consists of various term loans aggregating $22.0 million and $47.8 million as of December 31, 2004 and 2003, respectively. The weighted average interest rate for the term loans as of December 31, 2004 and 2003 is 5.95% and 7.46%, respectively. Other debt was comprised of the 409, 491 and 493 OP Notes totaling $18.7 million and $3.3 million represents the amount outstanding on aircraft tail number N537MC. During the year ended December 31, 2004, aircraft tail numbers N535MC and N354MC were rejected in the Chapter 11 Cases. Other debt was secured separately by aircraft tail numbers N535MC, N354MC and N537MC at December 31, 2003. The debt secured by tail number N537MC was amended on March 20, 2003 to extend the loan term to June 30, 2006. All previous defaults on the loan were waived at such time. Both Atlas and Polar signed guaranty agreements on July 27, 2004 for the 409 OP Note.

     DIP Financing Facility

          With respect to financing following the Bankruptcy Petition Date, the Company had obtained $50.0 million of DIP financing from CIT Group/Business Credit, Inc. and Abelco Finance LLC, an affiliate of Cerberus Capital Management, LLP (together, the “DIP Lenders”). The DIP financing facility was structured as an $18.0 million term loan facility and a $32.0 million revolving credit facility. The Company borrowed the $18.0 million term loan but did not draw down under the $32.0 million revolver. The term loan had a maturity date of the earlier of September 25, 2005 or the confirmation of the Plan of Reorganization and to the extent amounts were drawn upon bore interest at the rate of the higher of either (i) the DIP Lenders prime rate plus 6.5%, or (ii) 10.5%. The revolver had a maturity date of the earlier of September 25, 2005 or the confirmation of the Plan of Reorganization and to the extent amounts were drawn upon as (a) a prime borrowing bore interest at the rate of the higher of either (i) the DIP Lenders prime rate plus 2.25%, or (ii) 6.25%, or (b) a LIBOR borrowing bore interest at the rate of the higher of either (i) LIBOR plus 3.75%, or (ii) 5.75%. The Company paid fees of $2.5 million in connection with the draw against the term loan.

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          The term loan was repaid and the commitments under the DIP financing facility were terminated on July 27, 2004.

     Revolving Credit Facility

          On November 30, 2004, the Company entered into the Revolving Credit Facility. The Revolving Credit Facility provides the Borrowers with revolving loans of up to $60 million in the aggregate, including up to $10 million of letter of credit accommodations. Availability under the Revolving Credit Facility will be based on a borrowing base, which will be calculated as a percentage of certain eligible accounts receivable. The Revolving Credit Facility has an initial four-year term after which the parties can agree to enter into additional one-year renewal periods.

          Borrowings under the Revolving Credit Facility bear interest at varying rates based on either the prime rate of Wachovia Bank, National Association (the “Prime Rate”), or the rate of deposits of US dollars in the London interbank market (the “Adjusted Eurodollar Rate”). Interest on outstanding borrowings is determined by adding a margin to either the Prime Rate or the Adjusted Eurodollar Rate, as applicable, in effect at the interest calculation date. The margins are arranged in three pricing levels, based on the availability under the Revolving Credit Facility, that range from .25% below to .75% above the Prime Rate and 1.75% to 2.75% above the Adjusted Eurodollar Rate.

          The obligations under the Revolving Credit Facility are secured by each Borrower’s and Guarantor’s present and future assets and all products and proceeds thereof other than (i) real property, (ii) aircraft, flight simulators, spare aircraft engines and related assets that are subject to security interests of other creditors and (iii) some or all of the capital stock of certain of Holdings’ subsidiaries.

          The Revolving Credit Facility contains usual and customary covenants for transactions of this kind. At December 31, 2004, the Company had $19.0 million available for borrowing under the Revolving Credit Facility. No borrowings have been incurred through December 31, 2004.

          The following table summarizes the contractual maturities of the Company’s debt obligations reflecting the terms that were in effect as of December 31, 2004:

Years Ending December 31,
2005	$	36,084
2006		44,744
2007		52,451
2008		67,320
2009		88,036
Thereafter		350,434
	$	639,069

11. Leases

          The Chapter 11 Cases resulted in new agreements with most of the Company’s aircraft lessors. In certain cases, such negotiations led to the extension of the lease term and in others the lease term remained the same. In most cases, the revised terms reduced the total future obligation under the lease, in some cases substantially. (See Notes 2 and 3 above.)

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          Under SFAS 13 “Accounting for Leases”, the Company undertook the required re-evaluation as to whether such amended agreements resulted in a change in classification of the lease. For five leases involving B747-200 aircraft, the revised agreements resulted in a change in classification from operating to capital leases. With respect to these five leases, the related fair value of the aircraft and effective interest rate of the capital lease obligation are as follows at December 31, 2003

	Tail No.	Estimated Fair Value of the Aircraft at Date of Modification		Effective Interest Rate On Obligation
Atlas Air, Inc.
	N508MC	$	10,900		19.89	%
	N516MC		11,930		16.97	%
	N518MC		15,310		37.40	%
Polar Air Cargo, Inc
	N920FT		11,440		18.76	%
	N924FT		10,960		20.37	%
		$	60,540

          The effective interest rates on the obligations are the rates required to reduce the future lease payments, on a present value basis, to the fair value of the aircraft at the date the lease was renegotiated. Such rates were in excess of those that might have otherwise been available to the Company for other secured borrowings. During the Bankruptcy, the Company rejected the leases for N518MC and N924FT.

     Aircraft/Real Estate Capital and Operating Leases

          The following table summarizes rental expenses for leases in each of the periods ended:

	Successor		Predecessor
	For the Period July 28, 2004 Through December 31, 2004		For the Period January 1, 2004 Through July 27, 2004		For the Year Ended December 31, 2003		For the Year Ended December 31, 2002
Aircraft rent	$	60,151	$	81,886	$	183,329	$	213,310
Office, vehicles and other	$	7,207	$	10,043	$	14,864	$	13,620

          During 2003 and as more fully described in Note 2 above, as part of a comprehensive restructuring of the Company’s debt and lease obligations, the Company initiated a moratorium on substantially all of its debt and lease payments. As provided under Section 365 of the Bankruptcy Code, the Company was allowed to assume, assume and assign, or reject certain executory contracts and unexpired leases, including leases of real property, aircraft and aircraft engines, subject to the approval of the Bankruptcy Court and certain other conditions.

          As previously noted, the Company has accounted for the revised lease agreements upon reaching a binding term sheet, not withstanding the fact that certain of these revised agreements only became legally binding upon the effective date or, in certain cases, subsequent thereto.

          At December 31, 2004, eighteen of the forty-three operating aircraft of the Company were leased, of which three were capitalized leases and fifteen were operating leases with initial lease term expiration dates ranging from 2009 to 2025.

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          The following table summarizes the minimum annual rental commitments as of the periods indicated under capital leases and non-cancelable aircraft, real estate and other operating leases with initial or remaining terms of more than one year, reflecting the terms that were in effect as of December 31, 2004:

	Capital Leases		Aircraft Operating Leases		Other Operating Leases		Total Leases
Years Ending December 31,
2005	$	8,615	$	139,809	$	7,482	$	155,906
2006		8,850		128,052		5,644		142,546
2007		9,000		128,052		4,810		141,862
2008		9,000		143,277		4,578		156,855
2009		8,000		145,499		4,345		157,844
Thereafter		—		1,902,501		8,956		1,911,457
Total minimum lease payments		43,465	$	2,587,190	$	35,815	$	2,666,470
Less amounts representing interest		6,748
Present value of future minimum capital lease payments	$	36,717

          At December 31, 2003, and 2002, net gains on sale-leaseback transactions were $170.4 million, and $222.3 million, respectively, including $10.7 million and $12.5 million for three engines which were sold and leased back in 2002. These gains have been deferred and are being amortized over the term of the operating leases. Such amounts were eliminated at July 27, 2004 as part of the recording of assets and liabilities to fair value as required by fresh-start accounting.

          Amortization recorded for the periods July 28, 2004 through December 31, 2004 and January 1, 2004 through July 27, 2004 was zero and $4.3 million and for the years ended December 31, 2003, and 2002 was $12.4 million and $16.1 million, respectively.

          The effective interest rates on the capitalized leases for aircraft tail numbers N508MC, N516MC, and N920FT, was 7.16% at December 31, 2004. The rates were reset to fair value on July 28, 2004 due to fresh-start accounting.

          In addition to the above commitments, the Company leases engines under short-term lease agreements on an as needed basis.

          Certain leases described above contain renewal options.

12. Related Party Transactions

          All of the non-employee directors of the Company, namely Brian H. Rowe, Lawrence W. Clarkson, Richard A. Galbraith, Joseph J. Steuert, Stephen A. Greene, John S. Blue and Linda Chowdry, who served on the Company’s Board prior to July 27, 2004, resigned from the Board at or prior to the Effective Date. The Company was party to two separate consulting agreements with Joseph J Steuert, one of these former directors who is chairman and chief executive officer of The Transportation Group, an investment bank focused on the aviation industry. Effective March 1, 2003, the Company entered into a consultancy agreement (“First Agreement”), whereby the director agreed to provide the Company with consultancy services in connection with the restructuring of financial obligations with its debt holders and aircraft lessors. Pursuant to the terms of the First Agreement, the Company was required to pay a monthly fee of $95,000, as well as a success fee in the amount not less than $500,000 nor more than $800,000, which amount was determined at the sole discretion of the Company’s Board of Directors. The First Agreement had a four-month term and was automatically renewable for additional one-month terms unless either party provided notice of non-renewal of the First Agreement by the 20th day of the preceding month. The Company incurred consulting fees and expenses to this director of zero for the period July 28, through December 31, 2004, $0.8 million for the period January 1 through July 27, 2004, and $1.0 million, for the year ended December 31, 2003. The agreement was rejected in Chapter 11 Cases and the Company is no longer subject to the agreement or the agreement’s automatic renewal.

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          Effective October 1, 2003, the Company entered into a second consultancy agreement (“Second Agreement”), whereby Mr. Steuert agreed to provide the Company with consultancy services in connection with the arrangement of investments in the Company’s equity or convertible debt securities (collectively, “Equity Investment”) in conjunction with the restructuring of its debt and lease obligations. Pursuant to the terms of the Second Agreement, the Company was required to pay a success fee of 0.75% of the funded amount of each consummated Equity Investment regardless of whether the investors for the Equity Investments were introduced by the director to the transaction. The Second Agreement had an initial term expiring upon the later of February 1, 2004 or the date of confirmation of the Company’s Plan of Reorganization. The Second Agreement was terminated on January 29, 2004 and the Company did not incur any consulting fees under the Second Agreement.

          Another former director of the Company, Stephen A. Greene, is a partner in a law firm, Cahill, Gordon and Reindel, that acted as outside counsel to the Company. The Company paid legal fees and expenses to this law firm of $3.0 million for the period July 28, through December 31, 2004, $1.9 million for the period January 1 through July 27, 2004, and $4.6 million, and $2.1 million for the years ended December 31, 2003 and 2002, respectively.

          Effective July 27, 2004, the Company elected a new Board of Directors. The new Board includes James S. Gilmore III, a non-employee director of the Company, who is a partner at the law firm of Kelley Drye & Warren, LLP, current outside counsel to the Company, and Robert F. Agnew, also a non-employee director of the Company, who is an executive officer of Morten Beyer & Agnew, a consulting firm with which the Company transacts business. The Company paid legal fees to the firm of Kelley Drye & Warren, LLP of $2.7 million for the period July 28 through December 31, 2004 and $1.2 million for the period January 1 through July 27, 2004, and fees and expenses to Morten Beyer & Agnew, of $0.1 million for the period July 28 through December 31, 2004 and zero for the period January 1 through July 27, 2004. At December 31, 2004, the Company had a payable balance of $1.0 million, which is included in accrued liabilities on the consolidated balance sheet. Neither Mr. Gilmore nor Mr. Agnew serves on the Audit and Governance Committee of the Board of Directors. The Company incurred directors fees relating to these directors of $0.1 million for the period July 28, through December 31, 2004, and zero for the period January 1 through July 27, 2004.

          The Company dry leased three owned aircraft as of December 31, 2004 and two owned and one leased aircraft as of December 31, 2003 to a company in which we own a minority investment. The investment is accounted for under the equity method. The leases have terms that mature at various dates through July of 2007 and contain options for renewal by the lessor. The leases provide for payment of rent and a provision for maintenance costs associated with the aircraft. Total rental income for these aircraft was $19.0 million for the period July 28, through December 31, 2004 and $24.8 million for the period January 1 through July 27, 2004, and $37.1 million, and $8.0 million for the years ended December 31, 2003, and 2002, respectively. Sublease income for the leased aircraft included as a reduction to lease expense was $4.4 million for the period July 28, 2004 through December 31, 2004, $5.8 million for the period January 1, 2004 through July 27, 2004, and $14.7 million for the year ended December 31, 2003. There was no related party sublease income in 2002.

          Sankaty Financing Partners, LLC, which will likely be a holder of more than five percent of our New Common Stock following the issuance of the 20,000,000 shares to be issued under the Plan of Reorganization, is affiliated with a lender under our Aircraft Credit Facility and our AFL III Credit Facility.

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13. Income Taxes

          The Company accounts for income taxes according to the provisions of Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes.”

          The significant components of the provision for (benefit from) income taxes are as follows (in thousands):

	Successor		Predecessor
	For the Period July 28, 2004 Through December 31, 2004		For the Period January 1, 2004 Through July 27, 2004		For the Year Ended December 31, 2003		For the Year Ended December 31, 2002
Current:
Federal	$	336	$	9,368	$	—	$	—
State and local		262		1,116		—		—
Total current expense		598		10,484		—		—
Deferred:
Federal		16,087		—		—		—
State and local		1,419		—		—		—
Total deferred expense		17,506		—		—		—
Total income tax expense	$	18,104	$	10,484	$	—	$	—

          A reconciliation of differences between the U.S. federal statutory income tax rate and the effective income tax rates for the periods as defined below is as follows:

	Successor			Predecessor
	For the Period July 28, 2004 Through December 31, 2004			For the Period January 1, 2004 Through July 27, 2004			For the Year Ended December 31, 2003			For the Year Ended December 31, 2002
U.S. federal statutory tax (benefit)/expense rate		35.0	%		35.0	%		(35.0	)%		(35.0	)%
State and local taxes, net of federal benefit		2.8	%		7.4	%		—			—
Change in valuation allowance		—			(116.3	)%		23.0	%		33.3	%
Adjustment from prior years’ amended tax returns		—			—			9.9	%		—
Foreign loss for which no tax benefit was provided		—			—			1.9	%		—
Reorganization Items		3.5	%		74.4	%		—			—
Book expenses not deductible for tax purposes		2.2	%		2.4	%		0.2	%		1.7	%
Tax liabilities accrued		—			24.0	%		—			—
Other		0.9	%		0.2	%		—			—
Effective Tax Rate		44.4	%		27.1	%		0.0	%		0.0	%

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          The tax effects of temporary differences that give rise to significant portions of the deferred tax assets/(liabilities) as of December 31, 2004 (Successor Company) and December 31, 2003 (Predecessor Company) are as follows (in thousands):

	2004			2003
Deferred tax assets:
Net operating loss carry forwards	$	203,007		$	199,537
Deferred lease financing gains and losses		—			59,627
Aircraft leases		29,381			—
Reserves on accounts receivable and inventory		6,714			8,507
Maintenance		10,171			22,000
Accrued expenses and liabilities		4,779			4,226
Other		4,856			—
Total deferred tax assets		258,908			293,897
Less: Valuation allowance		(52,275	)		(97,511	)
Net deferred tax assets		206,633			196,386
Deferred tax liabilities:
Effects of discharge of indebtedness	$	(118,066	)	$	—
Fixed assets		(68,893	)		(181,603	)
Intangible assets		(22,443	)		(14,783	)
Fresh-start adjustments to indebtedness		(9,110	)		—
Equity investments		(5,040	)		—
Total deferred tax liabilities		(223,552	)		(196,386	)
Net deferred tax (liabilities)/assets	$	(16,919	)	$	—

          In accordance with SOP 90-7, subsequent to emergence from Chapter 11, any benefit realized from the reduction of the pre-emergence valuation allowance shall generally be recorded as a decrease to intangible assets, not as income to the Company. In the period July 28, 2004 through December 31, 2004, approximately $0.6 million of valuation allowance was reversed to intangible assets.

          In connection with the reorganization, the Company realized income from the cancellation of certain indebtedness. This income will not be taxable pursuant to section 108 of the Internal Revenue Code (the “Code”). However, the Company will be required (as of the beginning of its 2005 taxable year) to reduce certain tax attributes of the Company, potentially including net operating loss carryforwards (“NOLs”) and the tax basis in certain assets. At this time, management believes that from a regular federal income tax perspective NOLs are the principal tax attribute that will be reduced. Upon adoption of fresh-start reporting, the Company established a deferred tax liability to account for the cancellation of indebtedness resulting from the reorganization until such time as a determination is made as to the specific effects of the cancellation of indebtedness income.

          As of December 31, 2004, the Company has federal income tax NOLs of approximately $572 million (prior to the effects of the cancellation of indebtedness), which will expire from 2021 to 2024. Following the reduction of NOLs for the cancellation of indebtedness, it is currently estimated the Company will have approximately $243 million of NOLs remaining. The reorganization of the Company on the Effective Date constituted an ownership change under Section 382 of the Code. Accordingly, the use of any of the Company’s NOLs generated prior to the ownership change will be subject to an overall annual limitation.

          The Company’s management assesses whether it is more likely than not that some portion or all of the deferred tax assets will be realized. As of December 31, 2004, Management believes that it is not more likely than not that approximately $52.3 million of deferred tax assets will be realized, and therefore, a valuation allowance in that amount has been provided. The Company had a valuation allowance at December 31, 2003 of approximately $97.5 million. Accordingly, from December 31, 2003 to December 31, 2004, the valuation allowance decreased by approximately $45.2 million due to additional deferred tax liabilities recorded during the period which reverse within the NOL carryforward.

          The Company has been subject to an ongoing IRS examination of its 2001 federal consolidated income tax return, as well as other non-income tax related matters. This IRS exam and the related IRS Claims are discussed in Note 3.

          As of December 31, 2004, the Company has approximately $0.4 million of AMT credits.

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          The earnings associated with certain of the Company’s investments in its foreign subsidiaries are considered as indefinitely invested. Therefore, no provision for U.S. Federal income taxes on those earnings or translation adjustments have been provided.

14. Financial Instruments and Risk Management

          The Company maintains cash and cash equivalents with various high-quality financial institutions or in short-term duration high-quality debt securities. The carrying value for cash and cash equivalents, restricted funds held in trust, trade receivables and payables approximates their fair value.

          The fair values of the Company’s long-term debt were estimated using quoted market prices where available. For long-term debt which is not actively traded, fair values were estimated by reference to the discount related to the traded debt with consideration given to the fair value of the underlying collateral.

          At December 31, the fair values of the Company’s debt instruments are as follows:

	2004				2003
	Fair Value		Carrying Value		Fair Value		Carrying Value
Aircraft Credit Facility		36,477		35,024	$	31,812	$	43,578
AFL III Credit Facility		142,150		138,254		125,399		162,856
9 1/4% Senior Notes due 2008		—		—		56,476		152,886
9 3/8% Senior Notes due 2006		—		—		54,669		147,000
10 3/4% Senior Notes due 2005		—		—		51,292		137,475
2000 EETCs		76,891		71,571		43,857		59,916
1999 EETCs		143,604		135,018		61,576		87,258
1998 EETCs		208,892		200,530		57,098		73,470
Other		21,954		21,954		35,942		47,849

          In September 1997, Atlas entered into an interest rate swap agreement to manage interest costs associated with changing interest rates. The notional amount of the interest rate swap at inception was $210.0 million, decreasing over a term of eight years. The Company paid a fixed interest rate of 5.72%, increasing 0.25% annually, and received a floating interest rate based on the three-month London Interbank Offered Rate (LIBOR), whereby the net interest settled quarterly. During 2003, the Company terminated the interest rate swap agreement and has recorded liabilities of $4.4 million at December 31, 2003, which is included as a component of Other liabilities on the consolidated balance sheet. The liability was discharged in Chapter 11 Cases.

15. Segment Reporting

          The Company has four reportable segments: Scheduled Service, ACMI contract, AMC Charter and Charter Service. All reportable segments are engaged in the business of transporting air cargo, but have different operating and economic characteristics which are separately reviewed by the Company’s management. The Company evaluates performance and allocates resources to its segments based upon pre-tax income (loss), excluding pre-petition and post emergence costs and related professional fees, unallocated corporate and other, and reorganization items (“Fully Allocated Contribution” or “FAC”). Management views FAC as the best measure to analyze the profitability and contribution to net income or loss of the Company’s individual segments. The table provided at the end of this note shows FAC by segment and reconciles it to income (loss) before income taxes and cumulative effect of accounting change. Management allocates the cost of operating aircraft between segments on an average cost per aircraft basis.

          The Scheduled Service segment involves time definite airport-to-airport scheduled airfreight and available on-forwarding services provided primarily to freight forwarding customers. In transporting cargo in this way, the Company carries all of the commercial revenue risk (yields and cargo loads) and bears all of the direct costs of operation, including fuel. Distribution costs include direct sales costs through the Company’s own sales force and through commissions paid to general sales agents. Commission rates are typically between 2.5% and 5% of commissionable revenue sold. Scheduled Service is highly seasonal, with peak demand coinciding with the retail holiday season, which traditionally begins in September and lasts through mid December.

          The ACMI segment involves the provision of aircraft, crew, maintenance and insurance services whereby customers receive the use of an aircraft and crew in exchange for, in most cases, a guaranteed monthly level of operation at a predetermined rate for defined periods of time. The customer bears the commercial revenue risk and the obligation for other direct operating costs, including fuel.

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          The AMC Charter segment involves providing full-planeload charter flights to the U.S. Military through the AMC. The AMC Charter business is similar to the commercial charter business in that the Company is responsible for the direct operating costs of the aircraft. However, in the case of AMC operations, the price of fuel used during AMC flights is fixed by the military. The contracted charter rates (per mile) and fuel prices (per gallon) are established and fixed by the AMC for twelve-month periods running from October through September each year. The AMC buys capacity on a fixed basis annually and on an ad hoc basis continuously. The Company competes for this business through a teaming arrangement devised for the allocation of AMC flying among competing carriers. There are two groups of carriers or teams that compete for the business. The Company is a member of the team led by FedEx Corporation (“FedEx”). The Company pays a commission to FedEx based upon the revenues it receives under such contracts.

          The Charter Service segment involves providing full-planeload airfreight capacity on one or multiple flights to freight forwarders, airlines and other air cargo customers. Charters typically are contracted in advance of the flight and the Company bears the direct operating costs (except as otherwise defined in the charter contracts).

          Other revenue includes dry lease income and other incidental revenue, including risk sharing wet lease arrangements, not allocated to any of the four segments described above.

          Since assets are readily moved and are often shared, the Company does not report information about identifiable assets or capital expenditures at the segment level. Similarly it is impracticable to report revenue by geographic region for segments other than scheduled service. Depreciation is allocated to each segment based on aircraft utilization during the periods reported.

          The following table sets forth revenues, FAC, operating income (loss) and income (loss) before income taxes for the Company’s four reportable segments:

	Successor			Predecessor
	For the Period July 28, 2004 Through December 31, 2004			For the Period January 1, 2004 Through July 27, 2004			For the Year Ended December 31, 2003			For the Year Ended December 31, 2002
Revenues:
Scheduled Service	$	296,823		$	343,605		$	524,018		$	348,231
ACMI contracts		182,322			194,332			305,475			358,077
AMC charter		126,235			156,260			430,287			231,350
Charter service		53,325			15,812			86,592			145,235
All other		20,589			25,358			37,279			95,202
Total operating revenues		679,294			735,367			1,383,651			1,178,095
FAC:
Scheduled service		(11,069	)		(63,148	)		(92,575	)		(15,460	)
ACMI contracts		16,820			(13,391	)		(25,143	)		(25,808	)
AMC charter		16,382			14,824			64,913			20,041
Charter service		9,202			(2,984	)		3,135			2,309
Total FAC		31,335			(64,699	)		(49,670	)		(18,918	)
Unallocated corporate and other		13,585			2,461			(6,938	)		(79,451	)
Pre-petition and post-emergence costs and related professional fees		(4,106	)		(11,545	)		(44,382	)		—
Interest income		(917	)		(572	)		(3,724	)		(10,335	)
Interest expense		30,582			50,222			97,328			82,757
Other, net		(3,504	)		1,434			1,457			1,793
Operating income (loss)		66,975			(22,699	)		(5,929	)		(24,154	)
Interest income		(917	)		(572	)		(3,724	)		(10,335	)
Interest expense		30,582			50,222			97,328			82,757
Other, net		(3,504	)		1,434			1,457			1,793
Reorganization items, net		—			(112,513	)		—			—
Income (loss) before income taxes and cumulative effect of accounting change	$	40,814		$	38,730		$	(100,990	)	$	(98,369	)

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	Successor		Predecessor
	For the Period July 28, 2004 Through December 31, 2004		For the Period January 1, 2004 Through July 27, 2004		For the Year Ended December 31, 2003		For the Year Ended December 31, 2002
Depreciation expense:
Scheduled Service	$	5,452	$	6,420	$	5,625	$	3,926
ACMI contract		10,150		12,230		14,798		15,977
AMC charter		6,054		8,994		15,328		7,682
Commercial charter		1,656		910		2,860		4,707
Unallocated		2,145		4,955		21,528		22,113
Total depreciation	$	25,457	$	33,510	$	60,138	$	54,404
Scheduled Service revenue by geographic region:
Asia	$	164,607	$	160,448	$	250,258	$	160,666
Europe		45,764		63,522		98,102		52,749
Japan		29,025		34,526		47,851		41,357
South America		15,610		21,708		29,967		19,248
Other		41,817		63,400		95,840		74,211
Total Scheduled Service revenue	$	296,823	$	343,605	$	524,018	$	348,231

          The Company attributes operating revenue by geographic region based upon the origin of each flight segment.

16. Commitments and Contingencies

Aircraft Purchase Commitments

          Under the terms of the October 2000 purchase agreement between Boeing and Atlas one remaining Boeing 747-400 freighter aircraft was to be delivered to the Company in October 2003. In February 2003, Atlas and Boeing reached a Supplemental Agreement (the “Supplemental Agreement”) to defer the delivery date of the remaining aircraft until October 2006. As part of the Supplemental Agreement, approximately $2.9 million of purchase deposits on this aircraft were applied as a slide fee for deferring the delivery and expensed in 2003. The remaining $0.5 million of purchase deposits made as of December 31, 2003 were to be applied to a new deferred advance payment schedule on the aircraft. The Company has rejected the agreement with Boeing with respect to delivery of the aircraft and has restructured its financial arrangement on remaining deposits for future services. As of December 31, 2004, the balance of the credit for future services was $2.0 million. As of December 31, 2004, the Company has no aircraft purchase commitments.

Guarantees and Indemnifications

     General

          In the ordinary course of business, the Company enters into numerous real estate leasing and equipment and aircraft financing arrangements that have various guarantees included in the contracts. These guarantees are primarily in the form of indemnities. In both leasing and financing transactions, the Company typically indemnifies the lessors, and any financing parties against tort liabilities that arise out of the use, occupancy, manufacture, design, operation or maintenance of the leased premises or financed aircraft, regardless of whether these liabilities (or taxes) relate to the negligence of the indemnified parties. Currently, the Company believes that any future payments required under these guarantees or indemnities would be immaterial, as most tort liabilities and related indemnities are covered by insurance (subject to deductibles). Additionally, certain leased premises such as maintenance and storage facilities include indemnities of such parties for any environmental liability that may arise out of or relate to the use of the leased premise. The Company also provides standard indemnification agreements to officers and directors in the ordinary course of business.

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     Financings and Guarantees

          The Company’s loan agreements and other LIBOR-based financing transactions (including certain leveraged aircraft leases) generally obligate the Company to reimburse the applicable lender for incremental increased costs due to a change in law that imposes (i) any reserve or special deposit requirement against assets of, deposits with, or credit extended by such lender related to the loan, (ii) any tax, duty, or other charge with respect to the loan (except standard income tax) or (iii) capital adequacy requirements. In addition, the Company’s loan agreements, derivative transactions and other financing arrangements typically contain a withholding tax provision that requires the Company to pay additional amounts to the applicable lender or other financing party, generally if withholding taxes are imposed on such lender or other financing party as a result of a change in the applicable tax law.

          These increased costs and withholding tax provisions continue for the entire term of the applicable transaction, and there is no limitation in the maximum additional amount the Company could be required to pay under such provisions. Any failure to pay amounts due under such provisions generally would trigger an event of default, and, in a secured financing transaction, would entitle the lender to foreclose upon the collateral to realize the amount due.

     Restricted Cash and Letters of Credit

          The Company had $1.1 million and $4.3 million of restricted cash either pledged under standby letters of credit related to collateral or for certain deposits required in the normal course for items, including, but not limited to, surety and customs bonds, airfield privileges and insurance at December 31, 2004 and 2003, respectively. This amount is included in Deposits and other assets in the consolidated balance sheets. The standby letters of credit expire in 2005 and are renewable on an annual basis.

     Labor

          The Airline Pilots Association (“ALPA”) represents all of the Company’s U.S. crewmembers at both Atlas and Polar. Collectively, these employees represent approximately 54% of the Company’s workforce as of December 31, 2004. Polar’s collective bargaining agreement with ALPA became amendable in May 2003, and the Company cannot accurately predict the outcome of any negotiations with ALPA. Negotiations since July, 2003 have been under the direction of a mediator appointed by the National Mediation Board. Although the Company has never had a work interruption or stoppage and believes its relations with its crewmembers are generally good, the Company is subject to risks of work interruption or stoppage and may incur additional administrative expenses associated with union representation of its employees. If the Company is unable to reach agreement with its crewmembers on the terms of Polar’s collective bargaining agreement, or if Atlas were unable to negotiate future contracts with its crewmembers, the Company may be subject to work interruptions or stoppages.

          In November 2004, in order to increase efficiency and assist in controlling certain costs, the Company initiated steps to combine the ALPA represented bargaining units of Atlas and Polar. Any such combination will be in accordance with the terms and conditions of Atlas’s and Polar’s collective bargaining agreements, which agreements provide for a seniority integration process and the negotiation of a single collective bargaining agreement. Given the Company’s decision to integrate the two crewmember workforces, no negotiation sessions between Polar and ALPA are currently scheduled by the mediator.

     Legal Proceedings

In re: Atlas Air Worldwide Holdings, Inc., Atlas Air, Inc., Polar Air Cargo, Inc., Airline Acquisition Corp. I and Atlas Worldwide Aviation Logistics, Inc.

          As discussed above in Note 2, on the Bankruptcy Petition Date, Holdings, Atlas, Polar and two other wholly owned subsidiaries filed voluntary bankruptcy petitions for reorganization under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court. The Chapter 11 Cases were jointly administered under the caption “In re Atlas Air Worldwide Holdings, Inc., Atlas Air, Inc., Polar Air Cargo, Inc. Airline Acquisition Corp. I, and Atlas Worldwide Aviation Logistics, Inc., Case No. 04-10792.” As of the Bankruptcy Petition Date, virtually all pending litigation (including most of the actions described below) were stayed, and absent further order of the Bankruptcy Court, no party, subject to certain exceptions, was able to take any action to recover on pre-petition claims against the Company. Pursuant to a global settlement that resolved differences between the Atlas and Polar Creditors’ Committees and the Company regarding the Company’s initial Plan of Reorganization filed on April 19, 2004, all

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litigation between the parties named above was abated pending final documentation of the settlement terms and submission of a revised disclosure statement and the Plan of Reorganization. The requisite creditors having voted in favor of the plan, on July 16, 2004, the Bankruptcy Court entered the Order Confirming the Final Modified Second Amended Joint Plan of Reorganization of the Debtors, and the Company emerged from the bankruptcy proceedings on the Effective Date.

Shareholder Litigation

     Shareholder Derivative Actions

          On October 25, 2002 and November 12, 2002, shareholders of Holdings filed two separate derivative actions on behalf of Holdings against various former officers and former members of the Company’s Board of Directors in the Supreme Court of New York, Westchester County. Both derivative actions charge that members of the Board of Directors violated: (1) their fiduciary duties of loyalty and good faith, (2) generally accepted accounting principles, and (3) the Company’s Audit Committee Charter by failing to implement and maintain an adequate internal accounting control system. Furthermore, the actions allege that a certain named former director breached her fiduciary duties of loyalty and good faith by using material non-public information to sell shares of the Company’s common stock at artificially inflated prices. On February 3, 2004, Holdings provided notice of its January 30, 2004 bankruptcy filing to the court hearing the consolidated action. Because these derivative actions are property of the Company’s estate at the time of filing bankruptcy, all proceedings were stayed during the bankruptcy case. Under the Plan of Reorganization, Holdings became the holder of these claims and will decide whether to pursue some or all of the derivative claims against former officers and directors.

     Securities Class Action Complaints

          Seven putative class action complaints have been filed against Holdings and several of its former officers and former directors in the United States District Court for the Southern District of New York. The seven class actions were filed on behalf of purchasers of the Company’s publicly traded common stock during the period April 18, 2000 through October 15, 2002. These class actions alleged, among other things, that during the time period asserted, Holdings and the individual defendants knowingly issued materially false and misleading statements to the market in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The class actions included claims under the Securities Act of 1933 on behalf of purchasers of common stock issued by Holdings in a September 2000 secondary public offering pursuant to, or traceable to, a prospectus supplement dated September 14, 2000 and filed with the SEC on September 18, 2000 (the “September Secondary Offering”). The complaints sought unspecified compensatory damages and other relief. On May 19, 2003, these seven class actions were consolidated into one proceeding. A lead plaintiff and a lead counsel were appointed by that court.

          Plaintiffs filed a single consolidated amended class action complaint in August 2003 and a second consolidated amended class action complaint in October 2003. The second consolidated amended class action complaint supersedes and replaces all prior complaints, and alleges: (i) violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 against Holdings and six of its current or former officers or directors on behalf of all persons who purchased or otherwise acquired the common stock of Holdings between April 18, 2000 and October 15, 2002, inclusive, and (ii) violation of Sections 11 and 15 of the Securities Act of 1933 against Holdings, four of its former officers or directors and Morgan Stanley Dean Witter on behalf of all persons who purchased or otherwise acquired Atlas common stock issued in the September Secondary Offering. Each defendant moved to dismiss the second consolidated amended class action complaint on or about December 17, 2003. On February 3, 2004, Holdings notified the court hearing the consolidated action of the Company’s January 30, 2004 bankruptcy filing staying the litigation against Holdings.

          Since confirmation of the Plan of Reorganization, the Bankruptcy Court has entered an order subordinating claims arising from these class action proceedings to general unsecured claims. The Plan of Reorganization provides that subordinated claims receive no distribution.

     SEC Investigation

          On October 17, 2002, the SEC commenced an investigation arising out of the Company’s October 16, 2002 announcement that it would restate its 2000 and 2001 financial statements. In October 2002, the Company’s board of directors appointed a special committee which in turn retained the law firm of Skadden, Arps, Slate,

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Meagher & Flom, LLP for the purpose of performing an internal review concerning the restatement issues and assisting Holdings in its cooperation with the SEC investigation. A Formal Order of Investigation was subsequently issued authorizing the SEC to take evidence in connection with its investigation. The SEC has served several subpoenas on Holdings requiring the production of documents and witness testimony, and the Company has been fully cooperating with the SEC throughout the investigation.

          On October 28, 2004, the SEC issued a Wells Notice to Holdings indicating that the SEC staff is considering recommending to the SEC that it bring a civil action against Holdings alleging that it violated certain financial reporting provisions of the federal securities laws from 1999 to 2002. In addition, the SEC has filed one or more proofs of claim in the Chapter 11 Cases. Any recovery on these claims will be in the form of stock distributions to unsecured creditors. Holdings is currently engaging in discussions with the SEC regarding the Wells Notice and the possible resolution of this matter, and will continue to cooperate fully with the SEC in respect of its investigation. (See Note 3.)

          On July 22, 2004, the Company and certain former officers and directors commenced an adversary proceeding in the Bankruptcy Court against Genesis Insurance Company, which was the Company’s directors’ and officers’ insurance carrier until October 2002. The complaint filed in that action addresses various coverage disputes between Genesis and the plaintiffs with respect to the SEC investigation and the class action shareholder litigation described above. While the case remains pending, the parties are engaged in mediation in an attempt to settle this matter.

     Other Litigation

          On August 7, 2001, Atlas sued Southern Air, Inc. and Hernan Galindo in Miami-Dade County Circuit Court seeking damages in excess of $13.0 million. Atlas’ complaint alleged, among other things, that the defendants engaged in unfair competition and conspiracy, and committed tortious interference with Atlas contracts and/ or business relationships with Aerofloral, Inc. Atlas subsequently filed a second amended complaint joining additional defendants James K. Neff, Randall P. Fiorenza, Jay Holdings LLC, and EFF Holdings LLC, on the same legal theories asserted in the original complaint. On November 15, 2002, Southern Air, Inc. filed a bankruptcy petition for relief under Chapter 11 of the Bankruptcy Code, and thus, the lawsuit has been stayed against Southern Air, Inc. The Miami-Dade County Circuit Court, however, denied the other defendants’ motions to dismiss, and all have answered the second amended complaint denying any liability to Atlas. Southern Air, Inc. also filed a counterclaim against Atlas and a third party complaint against Holdings. The counterclaim and third party complaint alleged, among other things, that Atlas and Holdings are alter egos of each other and committed various torts against Southern Air, Inc., including tortious interference with contract and with advantageous business relationships, unfair competition, conspiracy, and other anti-competitive acts in violation of Florida law. The trial court granted Holdings’ motion to dismiss (without prejudice), for lack of personal jurisdiction over Holdings, and also granted Atlas’ motion to dismiss (without prejudice), for failure to state a cause of action. Southern has not, at this time, filed an amended counterclaim or an amended third party claim. Southern has emerged from bankruptcy and reorganized. Should the reorganized Southern file a counterclaim against Atlas which is not dismissed, Atlas is permitted to proceed against Southern in this litigation and set-off any recovery Atlas obtains against Southern against any recovery that may be obtained by Southern against Atlas. In addition, Atlas has filed a third party amended complaint joining the law firm of Greenberg & Traurig, PA and three of its shareholders (the “GT Defendants”) as additional defendants. These claims include tortious interference, aiding and abetting tortious interference, conspiracy, fraud and other related claims. The GT Defendants have moved to dismiss Atlas’ Third Amended Complaint as have the other defendants. Atlas is in the process of preparing opposition memoranda with respect to all of the Defendants’ Motions to Dismiss, which are set for hearing in late July or August 2005.

          To complement its existing Benelux trademark registration and obtain broader geographic protection, Atlas, in late 2003, filed an application to register its name and logo with the European Union. The application was recently opposed by Atlas Transport GmbH, a German-based surface transportation company that has an EU trademark registration dating back to 1997. Atlas Transport has also advised the Company that it may seek a preliminary injunction against the Company’s continued use of the Atlas name in the EU. The Company has filed a protective letter with the German courts, asserting its prior and continuing use of the Atlas name on flights to and from Germany.

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          ALPA filed a labor grievance against Polar challenging the permissibility under the Polar-ALPA collective bargaining agreement of certain wet lease flying performed by Atlas on behalf of Polar. This matter was presented to an arbitrator in February 2004 before the Polar Air Cargo, Inc. Crewmembers’ System Board of Adjustment (“SBA”). A preliminary decision was issued by the arbitrator denying ALPA’s grievance. ALPA requested an executive session of the SBA to challenge the arbitrator’s preliminary decision. A final decision was issued by the arbitrator on June 5, 2004, denying the grievance, and this matter is now closed.

          There were contested matters and legal proceedings between the Company and the Polar Creditors’ Committee in the Company’s Bankruptcy Case. By stipulation approved by the Bankruptcy Court, the Debtors assigned to such committee the authority to pursue all actions on Polar’s behalf necessary to the resolution of the inter-company claims scheduled by the Debtors as owing by Polar to Atlas and by Atlas to Polar, and the Atlas Committee has been similarly authorized to represent the interests of Atlas. The Debtors’ Schedules of Assets and Liabilities, as amended, list claims asserted by Atlas against Polar of approximately $188 million and claims asserted by Polar against Atlas of approximately $52 million. On May 7, 2004, the Polar Creditors’ Committee filed its Objection to Claim and Complaint for Avoidance and Recovery of Preferential Transfer, Avoidance and Recovery of Fraudulent Transfers and Obligations, Equitable Subordination of Claim, and Re-characterization of Claim (collectively the “Polar Committee Claim Objection”). The validity and allowance of the inter-company claims and the Polar Committee Claim Objection were rendered moot by the global settlement reached among the Debtors, the Atlas Committee and the Polar Creditors’ Committee, and approved by the Bankruptcy Court. In accordance with the global settlement, the Plan of Reorganization eliminated all inter-company claims among the Debtors; however, certain lenders and lessors alleged that some inter-company claims asserted by Atlas against Polar were excluded from the global settlement’s release. The Debtors settled these inter-company claims asserted by East Trust Sub 12 (an affiliate of GATX, “East Trust”) and Goldman Sachs Credit Partners L.P. (successor in interest to Bank One Leasing, “GSCP”), by inter alia, granting East Trust a claim against Polar of $1,250,000, and by liquidating GSCP’s claim against Polar at zero.

          In addition to the proofs of claim filed by the IRS as described in Note 3, incident to administering the Company’s bankruptcy estates, the Company is currently reconciling the proofs of claim filed in the bankruptcy. As part of this reconciliation process, the Company has objected to a multitude of claims, which will result in litigation between the Company and the various claimants that will be resolved by the Bankruptcy Court. A number of these claims, if resolved against the Company, could require significant cash payments or could require the Company to fund additional cash into the trust established for Polar’s creditors. Except for the IRS claims, described in Note 3, the Company does not believe that any one of these claims, if resolved against the Company, will, individually, have a material adverse effect on the Company’s business. However, if a number of these claims are resolved against the Company, they could, in the aggregate, have a material adverse effect on the Company’s business.

     Total Claims

          As of May 19, 2005, the Company had reviewed over 3,000 scheduled and filed claims aggregating approximately $7.5 billion, with a maximum of $850.8 million of claims that could potentially be allowed. Approximately $657.9 million of claims have been allowed to date, including $12.4 of cure claims and $1.0 million of other secured and priority claims. Claims of $192.9 million remain unresolved, including $116.0 million of unresolved IRS claims discussed below; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process.

     Atlas Unsecured Claims

          Pursuant to the Plan of Reorganization, the Company will make a pro rata distribution of 17,202,666 shares of New Common Stock to holders of allowed general unsecured claims against Holdings, Atlas, Acquisition and Logistics. General unsecured claims of approximately $2.6 billion were filed against these entities. As of May 19, 2005, claims of $604.6 million have been allowed, claims of $60.4 million remain disputed, and the balance of claims have been withdrawn or disallowed; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process.

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     Polar Unsecured Claims

          Pursuant to the Plan of Reorganization, the Company will pay cash equal to sixty cents on the dollar for allowed unsecured claims against Polar. General unsecured claims of approximately $408.4 million were filed against Polar. As of May 19, 2005, claims of $39.9 million have been allowed, claims of $16.5 million remain disputed, and the balance of claims have been withdrawn or disallowed; however, this figure has been, and continues to be, reduced by virtue of the ongoing claims reconciliation process. The Company estimates the additional allowed claims against Polar will ultimately be under $1 million.

          The Company has certain other contingencies resulting from litigation and claims incident to the ordinary course of business. Management believes that the ultimate disposition of these contingencies with the exception of those noted above is not expected to materially affect the Company’s financial condition, results of operations and liquidity.

17. Stockholders’ Equity

          On September 9, 2003, the Company received notification from the New York Stock Exchange (the “Exchange”) that trading in the Company’s common stock under the symbol CGO would be suspended immediately and that application would be made to the SEC to de-list the common shares. This application was approved by the SEC as of November 28, 2003, and the common stock was permanently removed from listing and registration on the Exchange. Since de-listing, our Old Common Stock had traded on the over counter market (“OTC”) on the Pink Sheets under the symbol AAWHQ. These shares were cancelled upon confirmation of the Reorganization Plan. See Note 3 for a discussion of the New Common Stock.

18. Stock-Based Compensation Plans

Successor

     2004 Long Term Incentive and Share Award Plan

          The Bankruptcy Court approved the 2004 Long Term Incentive and Share Award Plan (the “2004 Management Plan”) that provides for awards of up to 2.3 million shares of New Common Stock to employees in various forms. These include non-qualified options, incentive stock options, share appreciation rights, restricted shares, restricted share units, performance shares and performance units, dividend equivalents and other share-based awards. The portion of the 2004 Management Plan applicable to employees is administered by the Compensation Committee of the Board of Directors of the Company, which also establishes the terms of the awards. Non-qualified stock options and restricted shares have been the only form of awards granted by the Compensation Committee to date. A total of 1.2 million shares of New Common Stock remained available for future award grants as of December 31, 2004.

          Restricted shares of New Common Stock granted under the 2004 Management Plan vest over a three year period with the exception of 12,000 shares issued to directors that were vested on August 24, 2004. A total of 610,600 of New Common Stock restricted shares have been granted under the plan. The shares were valued at their fair market value of $10.7 million on the date of issuance. This amount has been recorded in equity as “Deferred Compensation” and will be amortized to expense over the three year vesting period. For the year ended December 31, 2004, the Company recognized compensation expense of $1.5 million for the vested portion of restricted shares of New Common Stock issued.

          Non-qualified stock options granted under the 2004 Management Plan vest over a three year period and expire ten years from the date of grant. A total of 526,700 options to acquire shares of New Common Stock have been granted under the plan. Non-qualified stock options may be granted at any price but, in general, are not granted with an exercise price less than the fair market value of the stock on the date of grant.

          2004 Employee Stock Option Plan

          The Bankruptcy Court approved the 2004 Employee Stock Option Plan (the “2004 Employee Plan”) that provides for awards of up to 495,000 shares of New Common Stock to employees in the form of non-qualified options or incentive stock options. The portion of the 2004 Employee Plan applicable to employees is adminis-

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tered by the Compensation Committee of the Board of Directors of the Company, which also establishes the terms of the awards. Non-qualified stock options have been the only form of award granted by the Compensation Committee to date.

          Non-qualified stock options granted under the 2004 Employee Plan vest over a three year period and expire ten years from the date of grant. A total of 299,963 options to acquire shares of New Common Stock have been granted under the plan. A total of 195,037 shares of New Common Stock remained available for future award grants as of December 31, 2004. Non-qualified stock options may be granted at any price but, in general, are not granted with an exercise price less than the fair market value of the stock on the date of grant.

          The table below summarizes the activity with respect to non-qualified stock options granted under the 2004 Management Plan and 2004 Employee Plan for the five month period ended December 31, 2004.

	Shares		Weighted Average Exercise Price
Outstanding at beginning of year		—	$	—
Granted		826,663		16.97
Exercised		—		—
Forfeited		35,865		16.75
Outstanding at year end		790,798	$	16.98

          The following table provides additional information for options outstanding at December 31, 2004:

		Options Outstanding
Range of Exercise Prices		Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price
$	16.70		493,300		9.6 years	$	16.70
$	17.45		297,498		9.7 years		17.45
			790,798			$	16.98

          There were no options exercisable at December 31, 2004.

Predecessor

1995 Long Term Incentive and Share Award Plan

          Pursuant to the Plan of Reorganization, all rights under existing options, restricted stock, warrants and rights of conversion were deemed cancelled on July 27, 2004.

          The 1995 Long Term Incentive and Share Award Plan (as amended) (the “1995 Plan”) provided for awards of up to 8.9 million shares of common stock to employees in various forms. These included non-qualified options, incentive stock options, share appreciation rights, restricted shares, restricted share units, performance shares and performance units, dividend equivalents and other share-based awards. Non-qualified stock options and restricted share units were the only form of awards granted by the Compensation Committee of the prior Board of Directors of the Company under the 1995 Plan.

          For the years ended December 31, 2003 and 2002, the Company recognized compensation expense of $410,000 and $685,700, respectively, for the vested portion of restricted share units issued. Compensation related to these awards is recognized ratably over the vesting period.

          The 1995 Plan also contained a provision that permitted non-employee directors to receive all or a portion of their quarterly remuneration in the form of common stock rather than cash. The first 25% of a non-employee director’s quarterly remuneration was required to be paid in the form of common stock. At December 31, 2002, the prior Board of Directors suspended this particular feature of the 1995 Plan indefinitely, and all remuneration paid to the former non-employee directors since that time was in the form of cash.

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          The 1995 Plan also provided for certain annual automatic grants of non-qualified stock options to non-employee directors, which became exercisable on the date of grant and expired on the tenth anniversary of the grant date. In August 2003, the prior Board of Directors elected to suspend this feature of the 1995 Plan indefinitely, and no options were granted to non-employee directors during 2003.

          Shares of our Old Common Stock, along with any stock options and restricted share units previously awarded under the 1995 Plan, were cancelled pursuant to our Plan of Reorganization.

          The table below summarizes the activity with respect to non-qualified stock options granted under the 1995 Plan for the years ended December 31.

	2004					2003					2002
	Shares			Weighted Average Exercise Price			Shares		Weighted Average Exercise Price		Shares			Weighted Average Exercise Price
Outstanding at beginning of year		2,771,637		$	17.29		4,440,064		$	19.47		3,901,258		$	23.73
Granted							21,750			1.57		838,750			4.41
Exercised		—			—		—			—		—			—
Forfeited		(2,771,637	)		17.29		(1,690,177	)		22.70		(299,944	)		20.54
Outstanding at year end		—		$	—		2,771,637		$	17.29		4,440,064		$	19.47

          The options available for exercise were 1,681,909 and 1,906,535 at December 31, 2003 and 2002, respectively.

Employee Stock Purchase Plan

          The Company had an approved Employee Stock Purchase Plan (the “Stock Purchase Plan”) for eligible employees of the Company. Employees eligible to participate in the Stock Purchase Plan were those who had completed at least 90 days of employment with the Company, but excluding employees whose customary employment was not more than five months in any calendar year or 20 hours or less per week. The Compensation Committee of the prior Board of Directors of the Company determined the terms and conditions under which shares were offered and corresponding options granted under the Stock Purchase Plan. The price per share at which the common stock was purchased pursuant to the Stock Purchase Plan was the lesser of 85% of the fair market value of the common stock on the first or last day of the applicable Purchase Period (as defined in the Stock Purchase Plan). In March 2003, the Company’s prior Board of Directors suspended the Stock Purchase Plan. During the plan year ended December 31, 2003, 182,007 shares were issued out of treasury stock at a weighted average cost of $1.91. The Stock Purchase Plan was terminated on July 27, 2004, the effective date of our Plan of Reorganization.

19. Retirement Plans

     Profit Sharing Plan

          Employees who have been employed by Atlas for at least twelve months as full-time employees are eligible to participate in the Profit Sharing Plan, which was adopted in 1994 by Atlas. The Profit Sharing Plan provides for payments to eligible employees in semiannual distributions based on the Company’s pretax profits. Beginning in 2002, the Profit Sharing Plan was revised to provide, among other things, that profit sharing would no longer have a guaranteed component, but will be based entirely upon the actual financial results of the Company. As a result no awards have been accrued in 2004, 2003 or 2002, given the Company’s financial performance.

     401(k) and 401(m) Plans

          Participants in the Atlas Plan may contribute up to 60% of their annual compensation to their 401(k) plan on a pre-tax basis, subject to aggregate limits under the Internal Revenue Code. Additionally participants can contribute up to 100% of their eligible compensation to the 401(m) plan on an after-tax basis. The Company provides on behalf of participants of the Atlas Plan, who make elective compensation deferrals, a matching contribution at the rate of 50% of employee contributions up to 10% of participant pretax compensation. Employee contributions in the Atlas Plan are vested at all times and the Company’s matching contributions are subject to a three-year cliff vesting provision. The Company recognized compensation expense associated with the Atlas Plan matching contributions totaling $1.3 million for the period July 28 through December 31, 2004, $1.6 million for the period January 1, through July 27, 2004, and $2.9 million, and $2.8 million for the years ended December 31, 2003 and 2002, respectively.

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          Polar has two 401k plans, one for employees who are crewmembers and one for employees who are non-crewmembers. Participants in either Polar Plan may contribute up to 25% of their annual compensation for their 401(k) plan on a pre-tax basis, subject to aggregate limits under the Internal Revenue Code. The Company provides on behalf of participants of the non-crew Polar Plan, who make elective compensation deferrals, a matching contribution at the rate of 50% of employee contributions up to 4% of participant pre-tax compensation. The Company provides on behalf of participants of the crew Polar Plan, who make elective compensation deferrals, a 100% matching contribution of up to 2% of participant pre-tax compensation. Employee contributions in the Polar Plan are vested at all times and the Company’s matching contributions are subject to a five-year step vesting provision. The Company recognized compensation expense totaling $0.3 million for the period July 28, through December 31, 2004, $0.6 million for the period January 1, through July 27, 2004, and, $0.6 million, and $0.5 million for the years ended December 31, 2003 and 2002, respectively, in connection with its matching contribution to the Polar Plan.

20. Income (Loss) Per Share and Number of Common Shares Outstanding

          Basic income (loss) per share represents the income (loss) divided by the weighted average number of common shares outstanding during the measurement period. Diluted income (loss) per share represents the income (loss) divided by the weighted average number of common shares outstanding during the measurement period while also giving effect to all potentially dilutive common shares that were outstanding during the period. Potentially dilutive common securities consist of 1.7 million, 2.8 million and 4.4 million stock options outstanding, for the period January 1, 2004 through July 27, 2004 and years ended December 31, 2003 and 2002, respectively. The impact of these potentially dilutive securities would be anti-dilutive and is not included in the diluted loss per share calculation.

          The calculations of basic and diluted loss per share for the period July 28, 2004 through December 31, 2004, for the period January 1, 2004 through July 27, 2004 and years ended December 31, 2003 and 2002 are as follows (in thousands, except per share data):

	Successor		Predecessor
	For the Period		For the Period
	July 28, 2004		January 1, 2004			For the			For the
	Through		Through			Year Ended			Year Ended
	December 31,		July 27,			December 31,			December 31,
	2004		2004			2003			2002
Numerator:
Income (loss) before cumulative effect of accounting change	$	22,710	$	28,246		$	(100,990	)	$	(98,369	)
Cumulative effect of accounting change		—		—			—			44,556
Net income (loss)	$	22,710	$	28,246		$	(100,990	)	$	(53,813	)
Denominator for basic earnings per share		20,210		38,378			38,360			38,210
Effect of dilutive securities:
Stock options		82		—	(A)		—	(A)		—	(A)
Restricted stock		113		—			—			—
Denominator for diluted earnings per share		20,405		38,378			38,360			38,210
Basic income (loss) per share:
Income (loss) before cumulative effect of accounting change	$	1.12	$	0.74		$	(2.63	)	$	(2.57	)
Cumulative effect of accounting change		—		—			—			1.16
Net income (loss)	$	1.12	$	0.74		$	(2.63	)	$	(1.41	)
Diluted income (loss) per share:
Income (loss) before cumulative effect of accounting change	$	1.11	$	0.74		$	(2.63	)	$	(2.57	)
Cumulative effect of accounting change		—		—			—			1.16
Net income (loss)	$	1.11	$	0.74		$	(2.63	)	$	(1.41	)

(A) Antidilutive

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          The calculation of basic shares includes the shares to be issued under the Plan of Reorganization as if such shares were issued on July 27, 2004. See Note 3. The calculation of diluted shares is calculated per FASB 128 and reflects the potential dilution that could occur if the stock options and restricted shares resulted in the issuance of common stock that then shared in the earnings of the entity. This is to give effect to the contingent issuance of shares and the dilutive effect on using the treasury stock method.

21. Subsequent Events

          On May 12, 2005 the Company entered into a slot conversion agreement with Israel Aircraft Industries Ltd. (“IAI”) and PSF Conversions LLP under which the Company would be able to convert four Boeing 747-400 passenger aircraft to freighter configuration during the period from late 2007 to mid-2008. The agreement also includes an option covering the modification of up to six additional Boeing 747-400 passenger aircraft to Boeing 747 special freighter (“747SF”) aircraft during the period from 2009 to 2011.

          One of the Company’s Boeing 747 200 aircraft (tail number N808MC) was damaged when it landed during poor winter weather conditions at Dusseldorf airport on January 24, 2005. As a result of this incident, the airframe and two of its engines were damaged beyond economic repair. Atlas has negotiated a $12.6 million cash-in-lieu-of-repair settlement with its insurance carriers and expects to receive the proceeds before the end of 2005. On May 31, 2005, Atlas paid $12.25 million to its secured lender in exchange for release of its lien on this aircraft. Since the settlement amount exceeds the net book value of the aircraft, Atlas expects to record a gain in the period of receipt of the insurance proceeds.

22. Selected Quarterly Financial Information (unaudited)

          The following tables summarize the 2004 and 2003 quarterly results, the comparability of 2004 to 2003 being impacted by our emergence from bankruptcy on July 27, 2004 (in thousands, except per share data):

	Predecessor									Successor
2004	First Quarter			Second Quarter			For the Period July 1, 2004 Through July 27, 2004			For the Period July 28, 2004 Through September 30, 2004			Fourth Quarter
Total Operating Revenues	$	297,454		$	338,308		$	99,605		$	250,571		$	428,723
Operating income (loss)		(21,862	)		8,204			(9,041	)		4,506			62,469
Net income (loss)	$	(58,580	)	$	(51,428	)	$	138,254		$	(4,352	)	$	27,062
Income (loss) per share:
Basic	$	(1.53	)	$	(1.34	)	$	3.60		$	(0.22	)	$	1.34
Diluted	$	(1.53	)	$	(1.34	)	$	3.60		$	(0.22	)	$	1.32

	Predecessor
2003	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Total Operating Revenues	$	345,125		$	326,404		$	322,374		$	389,748
Operating income (loss)		(18,640	)		(9,438	)		2,445			19,704
Net income (loss)	$	(37,892	)	$	(31,346	)	$	(24,575	)	$	(7,177	)
Income (loss) per share:
Basic	$	(0.99	)	$	(0.82	)	$	(0.64	)	$	(0.19	)
Diluted	$	(0.99	)	$	(0.82	)	$	(0.64	)	$	(0.19	)

          See Note 3 to the Consolidated Financial Statements for information regarding reorganization items and pre-petition and post emergence costs.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

          None.

ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Internal Controls

          Rule 13a-15(b) under the Exchange Act and Item 307 of Regulation S-K require management to evaluate the effectiveness of the design and operation of our disclosure controls and procedures (“disclosure controls”) as of the end of each fiscal quarter. Disclosure controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls are also designed with the objective of ensuring that such information is accumulated and communicated to our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate, to allow timely decisions regarding required disclosure. Rule 13a-15(c) and (d) and Item 308 of Regulation S-K require management to evaluate the effectiveness of the operation of our “internal controls over financial reporting” (“internal controls”) as of the end of each fiscal year, and any changes that occurred during each fiscal quarter. Internal controls are procedures which are designed with the objective of providing reasonable assurance that (i) our transactions are properly authorized; (ii) our assets are safeguarded against unauthorized or improper use; and (iii) our transactions are properly recorded and reported, all to permit the preparation of our financial statements in conformity with U.S. GAAP.

          The certifications of the CEO and CFO required pursuant to Rule 13a-14(d)/15d-14(a) under the Exchange Act and 18 U.S.C. Section 1350 (the “Certifications”) are furnished as exhibits to this Report. This section of the Report contains the information concerning the evaluation of our disclosure controls and changes to our internal controls referred to in the Certifications, and this information should be read in conjunction with the Certifications for a more complete understanding of the topics presented.

          We have taken a number of steps to ensure that all information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. In particular, we have formed a Disclosure Committee, which is governed by a written charter. Senior management meets on a weekly basis to report, review and discuss material aspects of its business. In addition, the Disclosure Committee, comprised of key management, is now holding regular quarterly meetings, and key members of the Disclosure Committee meet in person or correspond electronically upon the occurrence of an event that may require disclosure with the SEC. Additionally, management has implemented a “sub-certification” process to ensure that the persons required to sign the Certifications in periodic reports are provided with timely and accurate information and to provide them with the opportunity to address the quality and accuracy of our operating and financial results. Finally, with respect to internal controls, we have implemented a “Sarbanes-Oxley 404 Project,” which is further described below.

General Limitations on the Effectiveness of Controls

          We are committed to maintaining effective disclosure controls and internal controls. However, management, including the CEO and CFO, does not expect and cannot assure that our disclosure controls or our internal controls will prevent or detect all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential

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future conditions. Over time, any system of controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.

Remediation of Material Weaknesses

          At the conclusion of each of the audits of our consolidated financial statements for the years ended December 31, 2003 and 2002, our independent registered public accounting firm, Ernst & Young, LLP (“E&Y”), noted in a letter to management and the audit committee of our Board of Directors, a copy of which was presented to our Board of Directors, certain matters involving internal controls that they consider to be “material weaknesses” and “reportable conditions” under standards established by the AICPA. However, Ernst & Young, LLP has not been engaged to perform an audit of the Company’s internal controls over financial reporting. Accordingly they have not expressed an opinion on the effectiveness of the Company’s internal controls over financial reporting. “Reportable conditions” involve matters relating to significant deficiencies in the design or operation of internal controls that could adversely affect our ability to record, process, summarize, and report financial data consistent with the assertions of management in our consolidated financial statements. A “material weakness” is a reportable condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements caused by errors or fraud in amounts that would be material in relation to the consolidated financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions.

          On March 9, 2004, the Public Company Accounting Oversight Board adopted Auditing Standard No. 2 “An Audit of Internal Controls Over Financial Reporting Performed in Conjunction with An Audit of Financial Statements” (“PCAOB No.2”), which somewhat modified the definition of material weakness, and added the terms  “significant deficiency” and “internal control deficiency”. Under PCAOB No. 2, an internal control deficiency (or a  combination of internal control deficiencies) should be classified as a significant deficiency if, by itself or in combination with other internal control deficiencies, such deficiencies result in more than a remote likelihood that a misstatement of a company’s annual or interim financial statements that is more than inconsequential will not be prevented or detected. A significant deficiency should be classified as a material weakness if, by itself or in combination with other control deficiencies, such deficiency results in more than a remote likelihood that a material misstatement in the company’s annual or interim financial statements will not be prevented or detected.

          Management, with the assistance of a professional services firm, has implemented a “Sarbanes-Oxley 404 Project” to address, among other things, the matters noted in E&Y’s letters to management, as well as to prepare us for compliance with the requirements of Section 404 of the Sarbanes-Oxley Act. The documentation phase of the Sarbanes-Oxley 404 Project, which was initiated to evaluate the design effectiveness of our internal controls over financial reporting, has identified internal control deficiencies that would likely meet the PCAOB No. 2 definition of a material weakness or significant deficiency. These material weaknesses and significant deficiencies are comprised of items that had been previously identified by E&Y, as well as several additional matters that were identified separately by management as part of the Sarbanes-Oxley 404 Project. As of the date of this report, the Company is not an accelerated filer and it is not required to report on its assessment of the Company’s internal controls over financial reporting.

          As of June 15, 2005, we have identified, among other things, material weaknesses in the processes and procedures associated with our purchasing and payables, billing and receivables, inventory, the financial accounting close process, payroll and human resources, and certain weaknesses in the information technology general control environment. Examples of the issues identified include, among many others, inadequate segregation of duties, insufficient staffing in the finance department, failure to reconcile or analyze accounts, lack of effective review of the reconciliations and analysis that are prepared and, in some instances, poor design of controls and poor compliance with existing policies and procedures. As we progress with the Sarbanes-Oxley 404 Project and begin to evaluate the operating effectiveness of existing controls, it is possible that management will identify additional deficiencies that meet the definition of a material weakness or significant deficiency.

          Management has initiated substantial efforts to remediate the identified deficiencies and to establish adequate disclosure controls and internal controls over financial reporting as soon as reasonably practicable. Management has significantly increased the number of resources dedicated to our remediation efforts and has established a separate branch of the Sarbanes-Oxley 404 Project to focus exclusively on process transformation

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and remediation. Dedicated project teams and specific project plans for each process area have been created as part of this effort to address the control deficiencies in their respective areas and to work cross-functionally to address broad remediation items. This project provides for continuous updates as new processes and systems, improvements to internal controls over financial reporting, or changes to the existing processes and systems are implemented to remediate the identified deficiencies. Management is firmly committed to ensuring that improving the internal controls of all of our business processes, including those impacting financial reporting, and establishing and maintaining an effective overall control environment at our company remains a top priority. In that regard, we have also established a steering committee and executive sub-committee that have been tasked with monitoring and driving the progress of the Sarbanes-Oxley 404 Project and its project teams. These committees meet on a regular basis to receive reports and provide feedback and instruction for further progress. Management also provides regular reports to the Audit and Governance Committee on the Sarbanes-Oxley 404 Project. We will provide appropriate updates regarding our general progress with the remediation efforts in future filings.

Additional matters

          We have recently hired a Senior Vice President and CFO, Michael L. Barna. Mr. Barna joins the Company from Trafin Corporation and GE Capital Corporation. In addition, we have hired Gordon L. Hutchinson, formerly a Controller of Amtrak, effective May 2, 2005, as Vice President and Controller. Mr. Hutchinson is a certified public accountant. We believe that the hiring of Mr. Barna and Mr. Hutchinson will have a positive impact on the rapidity with which we can improve our internal controls and address the various matters described above.

CONCLUSIONS

          As described above, significant deficiencies and material weaknesses exist in our internal controls. We are in the process of taking various steps to remediate the items communicated by E&Y and identified by management as part of our Sarbanes-Oxley 404 Project. Additionally, we continue to take steps to improve our disclosure controls. However, a substantial effort will be required before all such items and matters are fully addressed. Accordingly we cannot provide any assurance that there will be no material weaknesses as of December 31, 2005 when management will report on its assessment of the Company’s internal controls over financial reporting.

ITEM 9B. OTHER INFORMATION

          None.

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PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

          The Board of Directors of AAWW (the “Board”) consists of nine members. With the exception of Mr. Erickson, our President and Chief Executive Officer, who has served as a director since March 5, 2003, all of the directors are non-employees. These non-employee directors assumed their positions on the Board upon our emergence from bankruptcy, except for Ronald L. Kerber, who has served as a director since December 21, 2004.

          Our By-laws provide that each director will continue in office until the next annual election and until his successor has been elected and qualified, or until his or her death, resignation or retirement.

          The following table sets forth the names, ages and positions of our directors and executive officers as of June 1, 2005. Additional biographical information concerning these individuals is provided in the text following the table. The directors’ committee assignments are also set forth below, with such committees further discussed under “Board Meetings and Committees.”

Name	Age	Position
Eugene I. Davis	50	Chairman of the Board of Directors (1) (2)
Robert F. Agnew	54	Director (2)
Keith E. Butler	51	Director (1) (3)
Duncan H. Cocroft	61	Director (2) (4)
Jeffrey H. Erickson	60	Director, President and Chief Executive Officer
James S. Gilmore III	55	Director (2)
Ronald L. Kerber	61	Director (1)
Herbert J. Lanese	60	Director (1)
Frederick McCorkle	60	Director (2)
Michael L. Barna	44	Senior Vice President and Chief Financial Officer
John W. Dietrich	40	Senior Vice President, General Counsel and Chief Human Resources Officer
Ronald A. Lane	55	Senior Vice President and Chief Marketing Officer
T. Wakelee Smith	47	Senior Vice President and Chief Operating Officer
William C. Bradley	44	Vice President and Treasurer
James R. Cato	50	Vice President—Flight Operations and Labor Relations
Gordon L. Hutchinson	46	Vice President and Controller
Ahmad R. Zamany	47	Vice President—Technical Operations

(1)	Member, Audit and Governance Committee
(2)	Member, Compensation Committee
(3)	Chair, Compensation Committee
(4)	Chair, Audit and Governance Committee

Directors of the Company

          Eugene I. Davis. Mr. Davis is Chairman and Chief Executive Officer of PIRINATE Consulting Group, LLC, a privately held consulting firm specializing in turnaround management, merger and acquisition consulting and hostile and friendly takeovers, proxy contests and strategic planning advisory services for domestic and international public and private business entities. Since forming PIRINATE in 1997, Mr. Davis has advised, managed, sold, liquidated and served as a Chief Executive Officer, Chief Restructuring Officer, Director, Committee Chairman and Chairman of the Board of a number of businesses operating in diverse sectors such as telecommunications, automotive, manufacturing, high-technology, medical technologies, metals, energy, financial services, consumer products and services, import-export, mining and transportation and logistics. Previously, Mr. Davis served as President, Vice Chairman and Director of Emerson Radio Corporation and CEO and Vice Chairman of Sport Supply Group, Inc. He began his career as an attorney and international negotiator with Exxon Corporation and Standard Oil Company (Indiana) and as a partner in two Texas-based law firms, where he specialized in corporate/securities law, international transactions and restructuring advisory. Mr. Davis holds a bachelor’s degree

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from Columbia College, a master of international affairs degree (MIA) in international law and organization from the School of International Affairs of Columbia University, and a Juris Doctorate from Columbia University School of Law. He is also a director of Metals USA, Inc., Metrocall, Elder-Beerman Stores, Inc., Eagle Geophysical Inc., and Tipperary Corporation.

          Robert F. Agnew. Since 1997, Mr. Agnew has been President and Chief Operating Officer of Morten Beyer & Agnew, an international aviation consulting firm experienced in the financial modeling and technical due diligence of airlines and aircraft funding. Mr. Agnew has over 30 years experience in aviation and marketing consulting and has been a leading provider of aircraft valuations to banks, airlines and other financial institutions worldwide. Prior to founding Morton Beyer & Agnew, Mr. Agnew owned Agnew & Associates, which focused on consulting services to companies involved in travel, transportation and telecommunications industries. Previously, he served as Senior Vice President of Marketing and Sales at World Airways. Mr. Agnew began his commercial aviation career at Northwest Airlines, where he concentrated on government and contract sales, schedule planning and corporate operations research. Earlier, he served in the U.S. Air Force as an officer and instructor navigator with the Strategic Air Command. Mr. Agnew is a graduate of Roanoke College and holds a master’s in business administration from the University of North Dakota.

          Keith E. Butler. Mr. Butler joined Paine Webber in 1997 which later merged with UBS Warburg, a global securities and investment banking firm. He is a financial advisor and former investment banker with UBS Warburg. Mr. Butler’s focus was on the transportation sector (air, shipping and rail), including the financing of freighter aircraft. Before Paine Webber merged with UBS, Mr. Butler was a Managing Director at Paine Webber, where he launched and built the first structured finance product group for transportation assets, and at Alex Brown, where he initiated the transportation debt practice. Mr. Butler graduated from Harvard College and received a master’s degree in business administration from Harvard Business School.

          Duncan H. Cocroft. Mr. Cocroft is a private investor who retired from Cendant Corporation in February, 2004. He was Executive Vice President—Finance and Treasurer of Cendant and Executive Vice President and Chief Financial Officer of PHH Corporation, Cendant’s wholly owned finance subsidiary. Prior to joining Cendant in June 1999, Mr. Cocroft served as Senior Vice President—Chief Administrative Officer of Kos Pharmaceuticals, where he was responsible for finance, information systems and human resources, and as Vice President—Finance and CFO of International Multifoods. Mr. Cocroft also served as a Vice President and Treasurer at Smithkline Beckman and PHH Group. Mr. Cocroft is a graduate of the Wharton School of Business at the University of Pennsylvania.

          Jeffrey H. Erickson. Mr. Erickson has been President of AAWW and a member of the Board of Directors since March 2003. He has also served as Chief Executive Officer since January 2004. In 2002, Mr. Erickson joined Atlas as President and Chief Operating Officer. He was subsequently named President and Chief Executive Officer of AAWW, Atlas and Polar. From 1994 to 1997, Mr. Erickson was President and Chief Executive Officer of Trans World Airlines following its emergence from bankruptcy. From 1990 to 1994, Mr. Erickson was President and CEO at Reno Air. Mr. Erickson also previously served as President and Chief Operating Officer of Midway Airlines, following operations experience with Aloha Airlines and Continental Airlines and engineering experience at Pan American World Airways. Mr. Erickson received his bachelor’s degree in Aeronautical Engineering from Rensselaer Polytechnic Institute and a master’s degree in Transportation Planning and Engineering from Polytechnic University.

          James S. Gilmore III. Mr. Gilmore has been a partner in the law firm of Kelley Drye & Warren LLP since 2002 and was Governor of the Commonwealth of Virginia from 1998 to 2002. He is currently the Chair of his firm’s Homeland Security Practice Group, and his practice also focuses on corporate, technology, information technology and international matters. In 2003, President George W. Bush appointed former Governor Gilmore to the Air Force Academy Board of Visitors, and he was elected Chairman of the Air Force Board in the fall of 2003. He served as the Chairman of the Republican National Committee from 2001 to 2002. Mr. Gilmore also served as Chairman of the Congressional Advisory Panel to Assess Domestic Response Capabilities for Terrorism involving Weapons of Mass Destruction, a national panel established by Congress to assess federal, state and local government capabilities to respond to the consequences of a terrorist attack. Also known as the “Gilmore Commission,” this panel was influential in developing the Office of Homeland Security. Mr. Gilmore is a graduate of the University of Virginia and the University of Virginia School of Law. He is also a director of IDT Corporation, Barr Laboratories and Windmill International.

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          Ronald L. Kerber. From 1991 until 2000, Mr. Kerber served as Executive Vice President, Chief Technology Officer and Member of the Executive Committee of Whirlpool Corporation. Mr. Kerber led Whirlpool’s product development and procurement programs, and managed business lines with annual sales totaling more than $1.2 billion. Prior to joining Whirlpool, Mr. Kerber served as Vice President, Technology and Business Development at McDonnell Douglas Corporation and was also a member of the corporation’s Executive Committee, Deputy Undersecretary of Defense for Research and Advanced Technology at the U.S. Department of Defense, and Professor of Electrical Engineering and Mechanical Engineering at Michigan State University. Since his retirement from Whirlpool in 2000, Mr. Kerber has devoted himself to a variety of entrepreneurial and pro bono activities. Currently, he is an independent consultant, a Visiting Professor at Darden Business School at the University of Virginia, and a member of the Defense Science Board of the U.S. Department of Defense. Mr. Kerber received his Bachelor of Science degree from Purdue University and his Masters and Doctorate degrees in engineering science from the California Institute of Technology.

          Herbert J. Lanese. Mr. Lanese has been an independent businessman and private investor for the past five years. He is a former President of McDonnell Douglas Aircraft. As Executive Vice President, Chief Financial Officer of McDonnell Douglas Corporation, he was a recognized leader of the corporation’s financial recovery in the early 1990s. Mr. Lanese’s career includes experience in all facets of corporate management, particularly financial management, turnarounds, workouts, acquisitions and divestments across a broad range of industries. Prior to joining McDonnell Douglas, he served as Corporate Vice President of Tenneco, Inc., where he was responsible for strategic planning, capital structure, accounting and information systems. Earlier, he held positions as Vice President and CFO of Tenneco’s Newport News Shipbuilding business and Vice President of Finance of Tenneco Chemicals. He began his career in Engineering and Production Management at General Motors before becoming Director, U.S. Chemical Operations, at BF Goodrich Company. Mr. Lanese earned his undergraduate and master in business administration degrees from Bowling Green State University.

          Frederick McCorkle. General McCorkle retired from the United States Marine Corps in October 2001 after serving since 1967. He last served as Deputy Commandant for Aviation, Headquarters, Marine Corps, Washington, D.C. General McCorkle is currently a Senior Advisor and a member of the board of directors of GKN Aerospace Services. He is also a member of the board of directors of Lord Corporation and Rolls-Royce North America. In addition to his board memberships, General McCorkle has served as a consultant for Boeing Aerospace, Optical Air Data Systems, Advanced Training Systems, Inc. and Ice Management Systems, Inc. General McCorkle is a graduate of East Tennessee State University and holds a master’s degree in Administration from Pepperdine University.

Executive Officers of the Company

          Michael L. Barna. Mr. Barna was named Senior Vice President and Chief Financial Officer of the Company in April 2005. Prior to joining the Company, Mr. Barna served as Partner, Managing Director, and member of the Executive Committee of Trafin Corporation, a finance company specializing in receivables financing and securiti-zation, since August 2004. Prior to his tenure at Trafin Corporation, Mr. Barna was employed at GE Capital Corporation for fifteen years. From 2000 to December 2003, Mr. Barna served as Executive Vice President of GE Aviation Services, where he led global strategic planning, operational re-engineering and e-commerce planning. From 1997 to 2000, Mr. Barna served as Managing Director of GE Capital Markets Services, developing and managing the execution of global capital markets strategies for GE Capital businesses. From 1990 to 1996, Mr. Barna was employed by GE Structured Finance Group, rising to the position of Vice President and Manager, where he executed leveraged transactions for industrial entities. Mr. Barna holds a bachelor of science degree in chemical engineering from the Pennsylvania State University and an MBA from Columbia University

          John W. Dietrich. Mr. Dietrich became a Senior Vice President of the Company in February 2004. In 2003, he was named Vice President and General Counsel and also assumed overall responsibility for the Company’s Human Resources and Corporate Communications functions. In 1999, Mr. Dietrich joined Atlas Air as Associate General Counsel. From 1992-1999, Mr. Dietrich was a litigation attorney at United Airlines, providing legal counsel to all levels of management, particularly on employment and commercial litigation issues. Mr. Dietrich attended Southern Illinois University and received his Juris Doctorate cum laude from John Marshall Law School. He is a member of the Bar in New York, Illinois and Colorado.

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          Ronald A. Lane. Mr. Lane became Senior Vice President and Chief Marketing Officer of the Company in April 2003. He is responsible for all global sales and marketing efforts at Atlas and Polar. From 2000 to 2003, Mr. Lane served as Chief Marketing Officer of Polar. From 1973 to 2000, Mr. Lane was employed with Evergreen International Aviation and its subsidiaries, rising to the position of Vice Chairman. Mr. Lane received his bachelor’s degree in Business from Oregon State University.

          T. Wakelee Smith. Mr. Smith has been Senior Vice President and Chief Operating Officer of the Company since June 2004. From July 2004 until December 2004, Mr. Smith also served on our Board. In 2003, Mr. Smith was named Senior Vice President, Corporate Planning and Business Development and Vice President, Strategic Development. In 2000, Mr. Smith joined the Company as a consultant. Before joining the Company, Mr. Smith was President of Flight Safety Boeing Training International, a leading provider of flight training for commercial aircraft. Mr. Smith attended Yale University and holds an MBA from Harvard Business School.

          William C. Bradley. Mr. Bradley was named Vice President and Treasurer of the Company in July 2002. He is responsible for capital market and corporate finance activities and banking, cash management, insurance, hedging and investor-relations activities. From 1993 to 2002, Mr. Bradley served as Vice President and Assistant Treasurer and head of the Financial Planning and Business Analysis Department at Viacom Inc. Mr. Bradley received a bachelor’s degree in International Affairs from Lafayette College and a master’s degree in International Affairs, with a specialization in International Business, from Columbia University.

          James R. Cato. Mr. Cato was named Vice President of Flight Operations and Labor Relations for the Company in May 2004. Mr. Cato was named Vice President of Labor Relations for Atlas in November 2000, and in 2003, assumed the additional responsibilities of Vice President of Flight Operations for Atlas and Vice President of Labor Relations for Polar. In 1999, he joined the Company as a consultant, serving as Atlas’ chief spokesperson for the negotiations that led to its first collective bargaining agreement with the Air Line Pilots Association. In the early 1990s, he was Director of Human Resources and Staff Vice President for DOT Affairs at Continental Airlines. Mr. Cato received his bachelor’s degree and Juris Doctorate from the University of Kansas.

          Gordon L. Hutchinson. Mr. Hutchinson was elected Vice President and Controller of the Company in May 2005. Mr. Hutchinson, a certified public accountant, served as Corporate Controller and a member of the Pension Plan and 401k Committees of National Railroad Passenger Corporation, a transportation and engineering construction company, from 2003 to 2005. From 2001 to 2003, he served as Chief Financial Officer and Corporate Secretary of MHI Communications, an advertising and marketing communications agency, where he was responsible for all financial operations. From 1999 to 2001, Mr. Hutchinson was Vice President of Finance for Teligent, Inc., a domestic and international wireless communication company, where he was responsible for all reporting and analysis of financial results. Mr. Hutchinson holds a bachelor of commerce degree from the University of British Columbia and studied executive management at the Richard Ivey School of Business of the University of Western Ontario.

          Ahmad Zamany. Mr. Zamany was named Vice President of Technical Operations for the Company in April 2004. He is responsible for the entire maintenance and engineering functions at Atlas and Polar, overseeing a group of more than 400 professionals involved in line and heavy maintenance, engineering, purchasing, materials, and quality control and assurance. Previously, Mr. Zamany served as Polar’s Senior Director of Technical Operations. Prior to joining the Company, Mr. Zamany served as Manager of Special Projects for VASP Brazilian Airlines in Sao Paulo, Brazil, Manager of Modifications and Recovery for Boeing Commercial Aircraft Group, Director of Maintenance and Engineering for Presidential Air and Manager of Technical Services Support for MGM Grand Air. He has also held positions as a Line Maintenance Crew Chief and Maintenance Controller. Mr. Zamany received his Bachelor of Science degree in Aeronautics from Parks College of St. Louis University, with a concentration in Aircraft Maintenance Engineering.

Board Meetings and Committees

          The Board maintains two standing committees, the Audit and Governance Committee and the Compensation Committee. The Board met eight times in 2004 since we emerged from bankruptcy on July 27, 2004. Each director attended at least 75% of the aggregate of (1) the total number of meetings of the Board (held during the period for which he has been a director) and (2) the total number of meetings of all committees of the Board on which the director served (during the periods that he served). The Board also believes that it should be sufficiently represented at our annual meeting of stockholders. All of the Board’s members are expected to attend the 2005 annual meeting.

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          In addition to Board and committee meetings, Atlas’ non-management directors meet in executive sessions without management present. These meetings are chaired by Eugene I. Davis, Chairman of the Board, Duncan H. Cocroft, Chairman of the Audit and Governance Committee, or Keith E. Butler, Chairman of the Compensation Committee, as applicable.

          Audit and Governance Committee. The Audit and Governance Committee’s primary function, as set forth in its written charter, is to assist the Board in overseeing (1) the integrity of our financial reports and other financial information provided to the public, (2) our system of controls, (3) the Company’s legal, regulatory, and ethical compliance, and (4) the auditing process. The Audit and Governance Committee appoints and oversees the Company’s independent accountants. The Audit and Governance Committee is also responsible for overseeing the Company’s Corporate Governance Principles and performing or overseeing an annual review of the CEO and the Board. The Audit and Governance Committee met six times in 2004 since we emerged from bankruptcy on July 27, 2004.

          The Board has determined that Mr. Cocroft, Chair of the Audit and Governance Committee, is an independent “audit committee financial expert” within the meaning of the federal securities laws.

          Compensation Committee. The Compensation Committee conducts its duties pursuant to its written charter, which sets forth its responsibility for approving and monitoring executive compensation plans, policies, and programs, and advising management on succession planning and other significant compensation or executive recruiting matters. As part of its responsibilities, the Compensation Committee reviews and sets salaries and establishes incentive compensation awards for our executive officers. In addition, the Compensation Committee is responsible for all significant employee benefit plan actions, including funding matters. The Compensation Committee met six times in 2004 since we emerged from bankruptcy on July 27, 2004.

Director Nominations

          Stockholder Nominations. AAWW By-laws permit stockholders to nominate directors for consideration at an annual stockholders’ meeting. Stockholder nominations to the Board must be forwarded to the Chairman of the Board, c/o the Secretary, Atlas Air Worldwide Holdings, Inc., 2000 Westchester Avenue, Purchase, New York 10577. The stockholder proposals for the 2006 Annual Stockholders’ Meeting must be received at the aforementioned address as provided in AAWW’s Proxy Statement for the 2005 Annual Meeting of Stockholders, which will be filed subsequent to the date of this Report. Any nominations received outside such period will be considered untimely. The written notice must satisfy certain requirements specified in the By-laws. A copy of the Bylaws will be sent to any stockholder upon written request to the Secretary of the AAWW.

Section 16(a) Beneficial Ownership Reporting Compliance

          Section 16(a) of the Exchange Act requires certain of our executive officers, as well as its directors and persons who own more than then percent (10%) of a registered class of AAWW’s equity securities to file reports of ownership and changes in ownership with the SEC. Based solely on its review of the copies of such forms received by us or written representations from reporting persons, we believe that during the last fiscal year all executive officers and directors complied with their filing requirements under Section 16(a) for all reportable transactions during the year.

Code of Ethics

          We have adopted an Employee Compliance Manual that applies to all of our employees, along with a Code of Ethics applicable to the Chief Executive Officer, Senior Financial Officers, and members of the Board of Directors (the “Code of Ethics”). The Code of Ethics was filed as Exhibit 14.1 to the Company’s Current Report on Form 8-K dated May 23, 2005 and is incorporated herein by reference as Exhibit 14.1 to this Report. Any person who wishes to obtain a copy of the Code of Ethics may do so by writing to Atlas Air Worldwide Holdings, Inc., Attn: Secretary, 2000 Purchase Street, Purchase, NY 10577.

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ITEM 11. EXECUTIVE COMPENSATION

          The following table sets forth the compensation earned by (i) our Chief Executive Officer and (ii) each of our four other most highly compensated executive officers for the fiscal year ended December 31, 2004 (hereafter, with the Chief Executive Officer, referred to as the “Named Executive Officers”), for the three fiscal years ended December 31, 2004, 2003 and 2002, respectively.

	Summary Compensation Table
										Long Term Compensation
			Annual Compensation							Awards
Name and							Other Annual			Restricted		Securities		All Other
Principal Positions at							Compensation			Stock		Underlying		Compensation
December 31, 2004	Year		Salary		Bonus		(1)			Awards(3)		Options(4)		(5)
Jeffrey H. Erickson		2004	$	506,727	$	—	$	147,486		$	2,937,254		126,700	$	255,000
President and Chief		2003		454,886	$	—		147,047			—		—		235,000
Executive Officer*		2002		133,333		—		358,782			—		—		—
T. Wakelee Smith**		2004	$	281,887	$	—	$		(2)	$	743,482		30,400	$	280,000
		2003		201,667		20,000		—	(2)		—		—		—
		2002		—		—		—			—		—		—
Ronald A. Lane***		2004	$	331,809	$	—	$		(2)	$	660,132		28,400	$	164,610
		2003		303,125		215,000		—	(2)		—		—		231,000
		2002		257,292		150,000		—	(2)		—		—		4,000
John W. Dietrich****		2004	$	268,393	$	—	$	27,926		$	660,132		28,400	$	146,500
		2003		223,025		—		129,523			—		—		126,000
		2002		183,459		—		35,757			—		—		5,500
James R. Cato*****		2004	$	238,785	$	—	$	91,318		$	350,070		13,800	$	98,000
		2003		224,700		—		150,492			—		—		90,263
		2002		222,032		47,187		—	(2)		—		—		5,500

*	Mr. Erickson has been President of the Company since March 2003 and Chief Executive Officer of the Company since January 2004.
**	In 2002, Mr. Smith was a consultant to the Company. In 2003, he was named Vice President, Strategic Development, and in 2004, he was named Senior Vice President and Chief Operating Officer of the Company.
***	In 2002 and 2003, Mr. Lane was Chief Marketing Officer for Polar. In April 2003, he was named Senior Vice President and Chief Marketing Officer of the Company.
****	In 2002, Mr. Dietrich was Associate General Counsel at Atlas. In 2003, he became Vice President of Legal and General Counsel of the Company. In February 2004, he became Senior Vice President, General Counsel and Chief Human Resources Officer of the Company.
*****	In 2002, Mr. Cato was Vice President of Labor Relations for Atlas. In 2003, he also became Vice President of Flight Operations for Atlas and Vice President of Labor Relations for Polar. In 2004, he was named Vice President of Flight Operations and Labor Relations for the Company.
(1)	Other Annual Compensation for 2004 for Mr. Erickson includes amounts relating to commuting and temporary housing ($117,771) and an automobile lease/allowance ($29,715). Other Annual Compensation for 2004 for Mr. Dietrich represents amounts attributable to an automobile lease/allowance. Other Annual Compensation for 2004 for Mr. Cato includes amounts relating to commuting and temporary housing ($68,080) and an automobile lease/allowance ($23,238).
	Other Annual Compensation for 2003 for Mr. Erickson includes amounts relating to commuting and temporary housing ($123,550), an automobile allowance ($21,279) and other miscellaneous perquisites. Other Annual Compensation for 2003 for Mr. Dietrich includes amounts relating to the pay down of outstanding mortgage subsidy relocation benefits ($90,141), relocation benefits ($22,628) and other miscellaneous perquisites. Other Annual Compensation for 2003 for Mr. Cato includes amounts relating to commuting and temporary housing ($74,110), an automobile lease ($22,134) and a deferred compensation distribution ($54,248).

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	Other Annual Compensation for 2002 for Mr. Erickson represents a miscellaneous moving/sign on allowance. Other Annual Compensation for 2002 for Mr. Dietrich represents certain relocation benefits.
(2)	In accordance with the rules of the SEC, no amount representing perquisites or other personal benefits, securities or property is disclosed if the total amount is equal to the lesser of $50,000 or 10% of the named executive officer’s salary and bonus.
(3)	The value of the restricted stock shown in the table is based on the closing market price of the New Common Stock as of the date of the award. As of December 31, 2004, total restricted stock awards and the related fair market values on such date were as follows: Mr. Erickson—176,200 shares ($4,228,800); Mr.Smith—44,600 shares ($1,070,400); Mr. Lane—39,600 shares ($950,400); Mr. Dietrich—39,600 shares ($950,400); and Mr. Cato—21,000 shares ($504,000). The restricted stock awards vest in three equal annual installments beginning on July 27, 2005. We do not expect to pay dividends on shares of our New Common Stock for the foreseeable future. To the extent that dividends are declared and paid on the New Common Stock, they would be paid on restricted stock at the same time and rate as paid to all stockholders.
(4)	The options shown in the table become exercisable in three equal annual installments beginning on July 27, 2005.
(5)	All Other Compensation includes for 2004 (a) key employee retention bonuses for Messrs. Erickson, Smith, Lane, Dietrich and Cato of $255,000, $280,000, $156,610, $140,000 and $90,000, respectively, and (b) employer matching contributions under the Company’s 401(k) plan for Messrs. Erickson, Smith, Lane, Dietrich, and Cato of $-0-, $-0-, $8,000, $6,500 and $8,000, respectively.
	All Other Compensation includes for 2003 (a) key employee retention bonuses for Messrs. Erickson, Smith, Lane, Dietrich and Cato of $235,000, $-0-, $225,000, $120,000 and $84,263, respectively, and (b) employer matching contributions under the Company’s 401(k) plan for Messrs. Erickson, Smith, Lane, Dietrich and Cato of $-0-, $-0-, $6,000, $6,000 and $6,000, respectively.
	All Other Compensation for 2002 for Messrs. Lane, Dietrich and Cato represents employer matching contributions under the Company’s 401(k) plan.

Option Grants, Exercises and Values

          The following table sets forth certain information relating to options granted to the Named Executive Officers during 2004.

	Option Grants in 2004
									Grant Date
	Individual Grants								Value (c)
	Number of		Percent of
	Securities		Total Options
	Underlying		Granted to
	Options		Employees
	Granted (#)		in 2004 (%)		Exercise Price		Expiration
Name	(a)		(b)		Per Share($/Sh.)		Date
Jeffrey H. Erickson		126,700		23.4%	$	16.70		8/11/14	$	2,416,955
T. Wakelee Smith		30,400		8.3	$	16.70		8/11/14		579,916
Ronald A. Lane		28,400		5.3	$	16.70		8/11/14		541,764
John W. Dietrich		28,400		5.3	$	16.70		8/11/14		541,764
James R. Cato		13,800		2.5	$	16.70		8/11/14		263,252

(a)	These options become exercisable in three equal annual installments beginning on July 27, 2005.
(b)	The total number of options granted in fiscal 2004 by the Company was 540,100 to 81 employees.
(c)	This estimated hypothetical value is based on a Black-Scholes option pricing model in accordance with SEC rules. We used the following assumptions in estimating this value: expected volatility—38.5%; risk-free rate of return—2.93%; expected dividend yield—0%; and time of exercise—three years. No adjustments were made for non-transferability or risk of forfeiture.

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Aggregated Option Exercises in 2004 and Option Values at December 31, 2004

          The following table sets forth certain information relating to the exercise of previously granted options by the Named Executive Officers during 2004. In connection with our emergence from bankruptcy on July 27, 2004, our Old Common Stock was cancelled, as were outstanding options to purchase shares of Old Common Stock, and our New Common Stock was authorized. Options in the following table relate to the New Common Stock. The table also presents the number and value (stock price less exercise price) of the remaining options held by the Named Executive Officers at year-end, using the average ($24.00) of the high and low trading prices for the New Common Stock on December 31, 2004.

							Value of Unexercised
	Number of				Number of Securities		In-The-Money Options at
	Shares		Value		Underlying Unexercised		December 31, 2004
	Acquired on		Realized		Options at December 31, 2004		(Exercisable/Unexercisable)
Name	Exercise (#)		($)		(Exercisable/Unexercisable)(#)		($)
Jeffrey H. Erickson		-0-		-0-		0/126,700	$	0/$924,910
T.Wakelee Smith		-0-		-0-		0/30,400		0/221,920
Ronald A. Lane		-0-		-0-		0/28,400		0/207,320
John W. Dietrich		-0-		-0-		0/28,400		0/207,320
James R. Cato		-0-		-0-		0/13,800		0/100,740

Stock-Based Incentive Plans

          In connection with the Plan of Reorganization and our emergence from bankruptcy in July 2004, we adopted a 2004 Long Term Incentive and Share Award Plan (the “Management Plan”) and a 2004 Employee Stock Option Plan (the “Option Plan” and, together with the Management Plan, the “Share Plans”). The Share Plans cover an aggregate of 2,772,559 shares of New Common Stock, of which 2,277,256 shares are reserved for issuance to management employees and directors under the Management Plan and 495,303 shares are reserved for issuance to non-management employees under the 2004 Option Plan.

          2004 Long Term Incentive and Share Award Plan. Employees and directors of, and consultants to, the Company and its subsidiaries and affiliates are eligible to participate in the Management Plan. The Management Plan provides for the granting of stock options, share appreciation rights (“SARs”), restricted shares, restricted share units, performance shares and performance units, dividend equivalents and other share-based awards. The Management Plan is administered by the Compensation Committee. All terms of any award granted under the Management Plan are determined by the Compensation Committee, including the number of shares covered, the exercise price, the vesting schedule and the term of options, the restrictions placed on restricted shares, and the performance requirements of performance shares and performance units, except that no option or SAR granted in tandem therewith may have a term exceeding ten years from the date of grant. Unless otherwise set forth in the relevant award agreement, awards under the Management Plan are not transferable except by will or the laws of descent and distribution. In accordance with the Plan of Reorganization, 610,600 shares of restricted New Common Stock and options to purchase 526,700 shares of New Common Stock were granted to members of management from July 27, 2004 to December 31, 2004. A portion of these shares and options are scheduled to vest in 2005.

          2004 Employee Stock Option Plan. Employees of AAWW and its subsidiaries and affiliates who are covered by a collective bargaining agreement that provides or allows for the granting of stock options are eligible to participate in the Option Plan. The Option Plan provides for the granting of stock options only. The Option Plan is administered by the Compensation Committee. All terms of any award granted under the Option Plan, including the number of shares covered, the exercise price, the vesting schedule and the term of options, are determined by the Compensation Committee, except that no option may have a term exceeding ten years from the date of grant. Unless otherwise set forth in the relevant award agreement, awards under the Option Plan are not transferable except by will or the laws of descent and distribution. In connection with the Plan of Reorganization, options to purchase 299,963 shares of New Common Stock were granted to certain pilot employees from July 27, 2004 to December 31, 2004. A portion of these options are scheduled to vest in 2005.

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Equity Compensation Plan Information

          The following table sets forth certain information relating to the shares of New Common Stock that may be issued under our stock-based incentive plans at December 31, 2004.

	A		B		C
					Number of Securities
					Remaining Available
					for Future Issuance
	Number of Securities		Weighted-Average		Under Equity
	to be Issued upon		Exercise Price of		Compensation Plans
	Exercise of		Outstanding		(excluding securities
	Outstanding Options,		Options, Warrants		reflected in column
Plan Category	Warrants and Rights		and Rights		(A)
Equity compensation plans approved by stockholders (a)		790,798	$	16.98		1,335,296
Equity compensation plans not approved by stockholders		-0-		-0-		-0-
Total		790,798	$	16.98		1,335,296

(a) Includes shares issuable pursuant to the Share Plans. The Share Plans were approved by us pursuant to the authority granted under the Plan of Reorganization. Pursuant to the Plan of Reorganization, the Share Plans are deemed to be approved by stockholders of the Company.

Compensation Committee Interlocks and Insider Participation

          No member of the Compensation Committee serves as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as members of the Board or Compensation Committee.

Employment and Other Agreements

          Jeffrey H. Erickson. Mr. Erickson’s employment agreement, which was amended effective April 1, 2005, had been entered into on September 1, 2002 and amended as of March 8, 2004, with an initial term of four years with automatic one-year renewals unless written notice was given by either party at least three months prior to such renewal. Mr. Erickson, whose initial title was President of Atlas, initially received an annual salary of $400,000, with his base salary increasing to $470,000 on March 19, 2003. He was subsequently named President and Chief Executive Officer of AAWW, Atlas and Polar and his base salary was increased to $510,000. Under the agreement, Mr. Erickson was eligible to receive (i) an annual incentive bonus at a target of 50% of his base salary based on the Company’s financial and Mr. Erickson’s individual performance for each calendar year during his employment, (ii) an annual automobile allowance on a tax grossed-up basis for either a company automobile or a purchased automobile, in either case valued at up to $40,000, (iii) commuting benefits, (iv) options to purchase 37,500 shares of AAWW common stock at an exercise price of $2.85 per share, vesting ratably over the four year employment period, (v) other customary benefits available to Company management employees, and (vi) in the event of termination of the agreement by Atlas for reasons other than Cause (as defined in the agreement) or by Mr. Erickson for Good Reason (as defined in the agreement), his then-base salary for a period of 18 months. The agreement also contained customary non-competition provisions.

          Effective April 1, 2005, Mr. Erickson’s employment agreement was amended and restated to provide that (i) in lieu of a four-year term, the employment period would run from September 1, 2002 until termination by either party upon notice as described above or in accordance with other terms of the agreement, (ii) Mr. Erickson’s base salary was increased to $524,400, in consideration for the elimination of the automobile allowance described above, (iii) Mr. Erickson would be eligible to participate in AAWW’s Annual Incentive Plan (the “Annual Incentive Plan”), an employee benefit plan to be developed by the Compensation Committee upon substantially the same terms and in lieu of the annual incentive bonus described above, (iv) the automobile allowance referred to in (ii) above was eliminated and in lieu of the tax gross-up related to such automobile allowance, Mr. Erickson will receive a one-time cash payment of $20,000 and (v) the commuting benefits described above were discontinued. Mr. Erickson’s stock

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options, which were granted in 2003, had previously been cancelled as a result of the Company’s emergence from Chapter 11 bankruptcy proceedings and the cancellation of the Company’s former class of Common Stock.

          T. Wakelee Smith. Mr. Smith’s employment agreement was entered into effective February 1, 2003. It was amended effective January 29, 2004 and again amended effective June 15, 2004. His title as of the original agreement date was Vice President, Corporate Planning, and his base salary was set at $220,000. His title was revised by the January 29, 2004 amendment to Senior Vice President, Corporate Planning and Development, and his base salary was increased to $260,000, with an agreement to increase this to $280,000 as of June 30, 2004. The June 15, 2004 amendment changed his title to Senior Vice President and Chief Operating Officer and increased his base salary to $300,000. The agreement had an initial term extending until January 31, 2008, with automatic one-year renewals unless written notice was given by either party at least three months prior to such renewal. Under the amended agreement, Mr. Smith is eligible to receive (i) an annual incentive bonus at a target of 50% of his base salary based on our financial and Mr. Smith’s individual performance for each calendar year during his employment, (ii) an automobile allowance on a tax grossed-up basis for either a Company automobile or a leased automobile, valued at an amount similar to that of other Company officers, (iii) other customary benefits available to Company management employees, and (iv) in the event of termination of the agreement by Atlas for reasons other than Cause (as defined in the agreement) or by Mr. Smith for Good Reason (as defined in the agreement), payment of 18 months of his then-base salary.

          Ronald A. Lane. Mr. Lane’s employment agreement was entered into effective May 1, 2003. It was amended effective January 24, 2004 and again amended effective April 20, 2004. His base salary as of the original agreement date was $300,000 and it provided that the salary would be reviewed from time to time, with a guarantee that the salary would be at least $350,000 as of May 1, 2005. The agreement had an initial term extending until May 1, 2008, with automatic one-year renewals unless written notice was given by either party at least three months prior to such renewal. Under the amended agreement, Mr. Lane is eligible to receive (i) an annual incentive bonus at a target of 50% of his base salary based on the Company’s financial and Mr. Lane’s individual performance for each calendar year during his employment, (ii) an automobile allowance of $700 per month (iii) other customary benefits available to our management employees, and (iv) in the event of termination of the agreement by Atlas for reasons other than Cause (as defined in the agreement) or by Mr. Lane for Good Reason (as defined in the agreement), a lump sum payment equal to 18 months of his then-base salary.

          John W. Dietrich. Mr. Dietrich’s employment agreement, which was amended effective April 1, 2005, had been entered into on March 19, 2003 and amended as of August 1, 2003 and January 29, 2004, respectively, with an initial term of three years with automatic one-year renewals unless written notice was given by the Company at least three months prior to such renewal or by Mr. Dietrich prior to such renewal. Mr. Dietrich, whose initial title was Vice President of Legal and Acting General Counsel of Atlas and AAWW, initially received an annual salary of $205,700. He was subsequently named (x) Vice President of Legal and General Counsel of AAWW, Atlas and Polar on March 19, 2003 with his base salary increasing to $240,000 at such time, and (y) Senior Vice President, General Counsel and Chief Human Resources Officer of AAWW, Atlas and Polar on May 15, 2003 with his base salary increasing to $260,000 as of February 1, 2004 and $280,000 as of June 30, 2004. Under the agreement, Mr. Dietrich was eligible to receive (i) an annual incentive bonus at a target of 50% of his base salary based on the Company’s financial and Mr. Dietrich’s individual performance for each calendar year during his employment, (ii) an automobile allowance on a tax grossed-up basis for either a company automobile or a leased automobile, valued at an amount similar to that of other Company officers, (iii) other customary benefits available to our management employees, and (iv) in the event of termination of the agreement by Atlas for reasons other than Cause (as defined in the agreement) or by Mr. Dietrich for Good Reason (as defined in the agreement), a lump sum payment equal to 18 months of his then-base salary.

          Effective April 1, 2005, Mr. Dietrich’s employment agreement was amended and restated to provide that (i) in lieu of a three-year term, the employment period would run from March 19, 2003 until termination by either party upon notice as described above or in accordance with other terms of the agreement, (ii) Mr. Dietrich’s base salary was increased to $292,000, in consideration for the elimination of the automobile allowance described above, (iii) Mr. Dietrich would be eligible to participate in the Annual Incentive Plan, upon substantially the same terms and in lieu of the annual incentive bonus described above, (iv) the automobile allowance referred to in (ii) above was eliminated and in lieu of the tax gross-up related to such automobile allowance, Mr. Dietrich will receive a onetime cash payment of $19,000, (v) the lump sum payable in the event of termination of the agreement by Atlas for

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reasons other than Cause or by Mr. Dietrich for Good Reason was reduced to 12 months of his then-base salary, and in consideration of such reduction, Mr. Dietrich will receive a one-time cash payment of $119,000.

          James R. Cato. Mr. Cato’s employment agreement was entered into effective November 1, 2000 and amended effective February 1, 2004. The agreement does not specify a fixed term of employment. His initial base salary was $195,000, which was increased by the February 1, 2004 amendment to $240,000. Under the amended agreement, Mr. Cato is eligible to receive (i) an annual incentive bonus at a target of 50% of his base salary based on the Company’s financial and Mr. Cato’s individual performance for each calendar year during his employment, (ii) an automobile allowance on a tax grossed-up basis for either a company automobile or a leased automobile, valued at an amount similar to that of our other officers, (iii) other customary benefits available to our management employees, and (iv) in the event of termination of the agreement by Atlas for reasons other than Cause (as defined in the agreement) or by Mr. Cato for Good Reason (as defined in the agreement), payment of 18 months of his then-base salary.

Compensation of Outside Directors

          Each non-employee director of Holdings is paid $50,000 in cash compensation annually, which is payable quarterly in advance, and also receives the following additional cash compensation, as applicable:

Committee Membership

• Each member of the Audit and Governance Committee, $15,000 annually;

• Each member of the Compensation Committee, $5,000 annually;

Chairman Position

• Chairman of the Board, $75,000 annually;

• Chairman of each of the Audit and Governance Committee and the Compensation Committee, $25,000 annually;

Meeting Fees

• For each meeting of the Board or a Committee of the Board, including any ad hoc committee, attended in person by a member, a fee to such member of $1,500 or $3,000 if such member is its Chairman; and

• For each meeting of the Board or a Committee of the Board, including any ad hoc committee, attended via teleconference or videoconference, a fee to each such member of $500 or $1,000 if such member is its Chairman.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

          The following table sets forth, as of June 1, 2005, information regarding beneficial ownership of our Common Stock by:

• Each stockholder who is known by us to beneficially own 5% or of the Common Stock;

• Each of our directors;

• Each of our named or Named Executive Officers in the Summary Compensation Table; and

• All of our executive officers and directors as a group.

          Unless otherwise indicated, each stockholder has sole voting and investment power with respect to the shares of New Common Stock beneficially owned by that stockholder. The number of shares beneficially owned by each is determined under the rules issued by the SEC. The information is not necessarily indicative of beneficial ownership for any other purpose. Under these rules, beneficial ownership includes any shares as to which the individual or entity has sole or shared voting power or investment power and any shares as to which the individual or entity has the right to acquire beneficial ownership within 60 days, through the exercise of any stock option

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or other right. The number of shares of our New Common Stock issued and outstanding as of June 1, 2005 was 3,650,149. The Plan of Reorganization relating to the Company’s emergence from bankruptcy contemplates the distribution of 17,202,666 shares of the New Common Stock to holders of allowed general unsecured claims of the Company. As of June 1, 2005, such distribution has not been made.

Beneficial Ownership Table

			Percentage of
	Total Number of		Outstanding Shares
	Shares Beneficially		(Beneficial
	Owned, Including		Ownership,
	Shares Actually		Including Shares
Name and Address of Beneficial Owner(a)	Owned(a)		Actually Owned)
Sankaty Financing Partners, LLC(b) 111 Huntington Avenue
Boston MA, 02199		439,047		12.0	%
Eugene I. Davis		20,000		*
Robert F. Agnew		19,500		*
Keith E. Butler		19,600		*
Duncan H. Cocroft		19,450		*
Jeffery H. Erickson		218,443		6.0	%
James S. Gilmore		20,000		*
Ronald L. Kerber		15,000		*
Herbert J. Lanese		19,333		*
Frederick McCorkle		19,333		*
James R. Cato		25,600		*
John W. Dietrich		49,066		1.3	%
Ronald A. Lane		49,066		1.3	%
T. Wakelee Smith		54,733		1.4	%
Directors and executive officers as a group (17 persons)		630,923		17.2	%

*	Represents less than 1% of the outstanding shares of New Common Stock.
(a)	Includes shares subject to vested options as follows:
	James R. Cato	4,600
	John W. Dietrich	9,466
	Jeffrey H. Erickson	42,233
	Ronald A. Lane	9,466
	T. Wakelee Smith	10,133
	Equity Compensation Plan information is provided in Item 11 above.
(b)	Includes shares owned by Boran Point II CBO 1000-1 Ltd, Great Point CBO 1998-1 Ltd, Sankaty Credit Opportunities LP, Sankaty High Yield Partners III LP, Sankaty High Yield Asset Partners LP and Sankaty High Yield Partners II LP, all of which share the same address as Sankaty Financing Partners, LLC.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

          All of our non-employee directors of the Company who served on the Board prior to July 27, 2004, namely Brian H. Rowe, Lawrence W. Clarkson, Richard A. Galbraith, Joseph J. Steuert, Stephen A. Greene, John S. Blue and Linda Chowdry, resigned from the Board at or prior to the Effective Date. We were party to two separate consulting agreements with one of these former directors, Joseph J. Steuert, who is chairman and chief executive officer of The Transportation Group, an investment bank focused on the aviation industry. Effective March 1, 2003, we entered into a consultancy agreement (the “First Agreement”), whereby Mr. Steuert agreed to provide us with consultancy services in connection with the restructuring of financial obligations with our debt holders and aircraft lessors. Pursuant to the terms of the First Agreement, we were required to pay a monthly fee of $95,000, as well as a success fee in the amount not less than $500,000 nor more than $800,000, which amount was determined at the sole discretion of the Company’s Board of Directors. The First Agreement had a four-month term

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and was automatically renewable for additional one-month terms unless either party provided notice of non-renewal of the First Agreement by the 20th day of the preceding month. We incurred consulting fees and expenses to Mr. Steuert of $0.8 million for the year ended December 31, 2004. The First Agreement was rejected in bankruptcy and we are no longer subject to the First Agreement or its automatic renewal.

          Effective October 1, 2003, we entered into a second consultancy agreement (the “Second Agreement”), whereby Mr. Steuert agreed to provide us with consultancy services in connection with the arrangement of investments in our equity or convertible debt securities (collectively, “Equity Investment”) in conjunction with the restructuring of its debt and lease obligations. Pursuant to the terms of the Second Agreement, we were required to pay a success fee of 0.75% of the funded amount of each consummated Equity Investment regardless of whether the investors for the Equity Investments were introduced by the director to the transaction. The Second Agreement had an initial term expiring upon the later of February 1, 2004 or the date of confirmation of the Plan of Reorganization. The second agreement was terminated on January 29, 2004 and we did not incur any consulting fees under the Second Agreement.

          Another of our former directors, Stephen A. Greene, is a partner in a law firm, Cahill, Gordon & Reindel, that acted as our outside counsel. We paid legal fees and expenses to this law firm of approximately $4.9 million for the year ended December 31, 2004.

          A new Board was appointed on the Effective Date pursuant to the Plan of Reorganization. The new Board includes James S. Gilmore III, a non-employee director of ours who is a partner at the law firm of Kelley Drye & Warren, LLP, outside counsel to us, and Robert F. Agnew, also a non-employee director of ours who is an executive officer of Morten Beyer & Agnew, a consulting firm with which we transact business. Neither Mr. Gilmore nor Mr. Agnew serves on the Audit and Governance Committee. For amounts paid by us in 2004 to Kelley Drye & Warren LLP and to Morten Beyer & Agnew, reference is made to Note 12 to our Consolidated Financial Statements included in Item 8 of Part II of the Report.

          Sankaty Financing Partners, LLC, a holder of more than five percent of our New Common Stock, is affiliated with a lender under our Aircraft Credit Facility and our AFL III Credit Facility. For information concerning these facilities, reference is made to the Notes to our Consolidated Financial Statements that are set forth in Item 8 of Part II of the Report.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Principal Accountant Fees and Services

          Our independent public accounting firm for the calendar years ended December 31, 2004 and 2003 was E&Y. Services provided to us by E&Y in fiscal 2004 and 2003 are described below.

          Audit Fees. Fees for audit services totaled $4,204,084 in 2004 and $1,354,268 in 2003, including fees associated with the annual audit, and the reviews of our quarterly reports on Form 10-Q.

          Audit-Related Fees. We did not incur any audit related fees.

          Tax Fees. Fees for tax services totaled $1,736 in 2004 and $51,518 in 2003, including tax compliance, tax advice and tax planning.

          All Other Fees. We did not incur any other fees.

Pre-Approval Policies and Procedures

          The Audit and Governance Committee pre-approves all audit and permissible non-audit services provided by the independent registered public accounting firm. These services may include audit services, audit-related services, and other services. The Audit and Governance Committee may delegate pre-approval authority to its Chair, who must report any decisions to the Audit and Governance Committee at the next scheduled meeting. The Committee will meet with management and the independent auditor to review and approve the proposed overall plan and scope of the audit for the current year.

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PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)	1.	Financial Statements:
		Report of Independent Registered Public Accounting Firm
		Consolidated Balance Sheets as of December 31, 2004 (Successor) and 2003 (Predecessor)
		Consolidated Statements of Income for the periods July 28, 2004 through December 31, 2004 (Successor), January 1, 2004 through July 27, 2004 and for the years ended December 31, 2003 and 2002 (Predecessor)
		Consolidated Statements of Cash Flows for the periods July 27, 2004 through December 31, 2004 (Successor), January 1, 2004 through July 28, 2004 and for the years ended December 31, 2003 and 2002 (Predecessor)
		Consolidated Statements of Stockholders’ Equity (Deficit) for the periods July 28, 2004 through December 31, 2004 (Successor), January 1, 2004 through July 27, 2004 and for the years ended December 31, 2003 and 2002 (Predecessor)
		Notes to Consolidated Financial Statements
	2.	Financial Statement Schedule:
		Schedule II—Valuation of Qualifying Accounts and Reserves
		All other schedules have been omitted because they are not applicable, not required, or the information is included elsewhere in the Consolidated Financial Statements or Notes thereto.
	3.	Exhibits: See accompanying Exhibit Index included after the signature page of this Report for a list of exhibits filed or furnished with or incorporated by reference in this Report.

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SIGNATURES

          Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized on June 30, 2005.

ATLAS AIR WORLDWIDE HOLDINGS, INC.
	(Registrant)
By:	/s/ Jeffrey H. Erickson
	Jeffrey H. Erickson
	President and Chief Executive Officer

          Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on June 30, 2005 on behalf of the Registrant and in the capacities indicated.

Signature	Capacity
/s/ Eugene I. Davis	Chairman of the Board
Eugene I. Davis
/s/ Jeffrey H. Erickson	President, Chief Executive Officer and Director
	(Principal Executive Officer)
Jeffrey H. Erickson
/s/ Michael L. Barna	Senior Vice President and Chief Financial Officer
	(Principal Financial Officer)
Michael L. Barna
/s/ Gordon L. Hutchinson	Vice President and Controller
	(Principal Accounting Officer)
Gordon L. Hutchinson
/s/ Robert F. Agnew	Director
Robert F. Agnew
/s/ Keith E. Butler	Director
Keith E. Butler
/s/ Duncan H. Cocroft	Director
Duncan H. Cocroft
/s/ James S. Gilmore III	Director
James S. Gilmore III
/s/ Ronald L. Kerber	Director
Ronald L. Kerber
/s/ Herbert J. Lanese	Director
Herbert J. Lanese
/s/ Frederick McCorkle	Director
Frederick McCorkle

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SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS
(in thousands)

			Additions
Description	Balance at Beginning of Period		Charged to Costs and Expenses			Charged to Other Accounts		Deductions			Balance at End of Period
For the Period July 28, through December 31, 2004
Allowances deducted in the balance sheet from the assets to which they apply:
Allowance for doubtful accounts	$	11,226	$	3,409		$	16	$	(3,399	)(a)	$	11,252
Allowance for obsolete inventory		—		—			—		—			—
Total	$	11,226	$	3,409		$	16	$	(3,399	)(a)	$	11,252
For the Period January 1, through July 27, 2004
Allowances deducted in the balance sheet from the assets to which they apply:
Allowance for doubtful accounts	$	24,304	$	(2,329	)	$	480	$	(11,229	)(a)	$	11,226
Allowance for obsolete inventory		1,357		1,802			—		(3,159	)		—
Total	$	25,661	$	(527	)	$	480	$	14,388		$	11,226
For the Year ended December 31, 2003
Allowances deducted in the balance sheet from the assets to which they apply:
Allowance for doubtful accounts	$	40,794	$	19,931		$	662	$	(37,083	)(a)	$	24,304
Allowance for obsolete inventory		—		1,931			—		(574	)		1,357
Total	$	40,794	$	21,862		$	662	$	(37,657	)	$	25,661
For the Year ended December 31, 2002
Allowances deducted in the balance sheet from the assets to which they apply:
Allowance for doubtful accounts	$	35,964	$	16,399		$	—	$	(11,569	)(a)	$	40,794
Allowance for obsolete inventory		7		90			—		(97	)		—
Total	$	35,971	$	16,489		$	—	$	(11,666	)	$	40,794

(a) Uncollectible accounts net of recoveries

S-1

Exhibit Number		Description
	2.1.1(9)	Findings of Fact, Conclusions of Law, and Order Under 11 U.S.C. §§ 1129 (a) and (b) and Fed. R. Bankr. P. 3020 Confirming the Final Modified Second Amended Joint Plan of Reorganization of Atlas Air Worldwide Holdings, Inc. and Its Affiliated Debtors and Debtors-in-Possession.
	2.2.1(9)	Second Amended Disclosure Statement Under 11 U.S.C. 1125 In Support of the Debtors’ Second Amended Joint Chapter 11 Plan.
	3.1.1(8)	Certificate of Incorporation of the Company.
	3.2.1	By-Laws of the Company as of July 28, 2004.
	4.1.1(1)	Form of 8.707% Atlas Air Pass Through Certificates, Series 2000-1A (included in Exhibit 4.7).
	4.1.2(1)	Form of 9.057% Atlas Air Pass Through Certificates, Series 2000-1B (included in Exhibit 4.8).
	4.1.3(1)	Form of 9.702% Atlas Air Pass Through Certificates, Series 2000-1C (included in Exhibit 4.9).
	4.1.4(6)	7.20% Atlas Air Pass Through Certificate 1999-1A-1, Certificate No. A-1-1.
	4.1.5(6)	7.20% Atlas Air Pass Through Certificate 1999-1A-1, Certificate No. A-1-2.
	4.1.6(6)	6.88% Atlas Air Pass Through Certificate 1999-1A-2, Certificate No. A-2-1.
	4.1.7(6)	7.63% Atlas Air Pass Through Certificate 1999-1B-1, Certificate No. B-1.
	4.1.8(6)	8.77% Atlas Air Pass Through Certificate 1999-1C-1, Certificate No. C-1
	4.1.9(3)	Pass Through Trust Agreement, dated as of February 9, 1998, between Atlas Air, Inc. and Wilmington Trust Company, as Trustee, relating to the Atlas Air Pass Through Trust 1998-1A-0.
	4.1.10(3)	Pass Through Trust Agreement, dated as of February 9, 1998, between Atlas Air, Inc. and Wilmington Trust Company, as Trustee, relating to the Atlas Air Pass Through Trust 1998-1A-S.
	4.1.11(3)	Pass Through Trust Agreement, dated as of February 9, 1998, between Atlas Air, Inc. and Wilmington Trust Company, as Trustee, relating to the Atlas Air Pass Through Trust 1998-1B-0.
	4.1.12(3)	Pass Through Trust Agreement, dated as of February 9, 1998, between Atlas Air, Inc. and Wilmington Trust Company, as Trustee, relating to the Atlas Air Pass Through Trust 1998-1B-S.
	4.1.13(3)	Pass Through Trust Agreement, dated as of February 9, 1998, between Atlas Air, Inc. and Wilmington Trust Company, as Trustee, relating to the Atlas Air Pass Through Trust 1998-1C-0.
	4.1.14(3)	Pass Through Trust Agreement, dated as of February 9, 1998, between Atlas Air, Inc. and Wilmington Trust Company, as Trustee, relating to the Atlas Air Pass Through Trust 1998-1C-S.
	4.1.15(6)	Pass Through Trust Agreement, dated as of April 13, 1999, between Wilmington Trust Company, as Trustee, and Atlas Air, Inc.
	4.1.16(6)	Trust Supplement No. 1999-1A-1, dated April 13, 1999, between Wilmington Trust Company, as Trustee, and Atlas Air, Inc. to Pass Through Trust Agreement, dated as of April 1, 1999.
	4.1.17(6)	Trust Supplement No. 1999-1A-2, dated April 13, 1999, between Wilmington Trust Company, as Trustee, and Atlas Air, Inc. to Pass Through Trust Agreement, dated as of April 1, 1999.
	4.1.18(6)	Trust Supplement No. 1999-1B, dated April 13, 1999, between Wilmington Trust Company, as Trustee, and Atlas Air, Inc. to Pass Through Trust Agreement, dated as of April 1, 1999.
	4.1.19(6)	Trust Supplement No. 1999-1C, dated April 13, 1999, between Wilmington Trust Company, as Trustee, and Atlas Air, Inc. to Pass Through Trust Agreement, dated as of April 1, 1999.
	4.1.20(1)	Pass Through Trust Agreement, dated as of January 28, 2000, between Wilmington Trust Company, as Trustee and Atlas Air, Inc.

Exhibit Number		Description
	4.1.21(1)	Trust Supplement No. 2000-1A, dated January 28, 2000, between Wilmington Trust Company, as Trustee, and Atlas Air, Inc. to Pass Through Trust Agreement, dated as of January 28, 2000.
	4.1.22(1)	Trust Supplement No. 2000-1B, dated January 28, 2000, between Wilmington Trust Company, as Trustee, and Atlas Air, Inc. to Pass Through Trust Agreement, dated as of January 28, 2000.
	4.1.23(1)	Trust Supplement No. 2000-1C, dated January 28, 2000, between Wilmington Trust Company, as Trustee, and Atlas Air, Inc. to Pass Through Trust Agreement, dated as of January 28, 2000.
	4.1.24(3)	Note Purchase Agreement, dated as of February 9, 1998, among the Company, Wilmington Trust Company and First Security Bank, National Association (“Note Purchase Agreement 1998”).
	4.1.25(1)	Form of Leased Aircraft Participation Agreement (Participation Agreement among Atlas Air, Inc., Lessee, First Security Bank, National Association, Owner Trustee, and Wilmington Trust Company, Mortgagee and Loan Participant) (Exhibit A-1 to Note Purchase Agreement 1998).
	4.1.26(1)	Form of Owned Aircraft Participation Agreement (Participation Agreement between Atlas Air, Inc., Owner, and Wilmington Trust Company, as Mortgagee, Subordination Agent and Trustee) (Exhibit C-1 to Note Purchase Agreement 1998).
	4.1.27(1)	Form of Lease (Lease Agreement between First Security Bank, National Association, Lessor, and Atlas Air, Inc., Lessee) (Exhibit A-2 to Note Purchase Agreement 1998).
	4.1.28(6)	Note Purchase Agreement, dated as of April 13, 1999, among Atlas Air, Inc., Wilmington Trust Company, as Trustee, Wilmington Trust Company, as Subordination Agent, First Security Bank, National Association, as Escrow Agent, and Wilmington Trust Company, as Paying Agent (“Note Purchase Agreement 1999”).
	4.1.29(6)	Form of Leased Aircraft Participation Agreement (Participation Agreement among Atlas Air, Inc., Lessee, First Security Bank, National Association, Owner Trustee, and Wilmington Trust Company, Mortgagee and Loan Participant) (Exhibit A-1 to Note Purchase Agreement 1999).
	4.1.30(6)	Form of Lease (Lease Agreement between First Security Bank, National Association, Lessor, and Atlas Air, Inc., Lessee) (Exhibit A-2 to Note Purchase Agreement 1999).
	4.1.31(6)	Form of Owned Aircraft Participation Agreement (Participation Agreement between Atlas Air, Inc., Owner, and Wilmington Trust Company, as Mortgagee, Subordination Agent and Trustee) (Exhibit C-1 to Note Purchase Agreement 1999).
	4.1.32(1)	Note Purchase Agreement, dated as of January 28, 2000, among Atlas Air, Inc., Wilmington Trust Company, as Trustee, Wilmington Trust Company, as Subordination Agent, First Security Bank, National Association, as Escrow Agent, and Wilmington Trust Company, as Paying Agent (“Note Purchase Agreement 2000”).
	4.1.33(1)	Form of Leased Aircraft Indenture (Trust Indenture and Mortgage between First Security Bank, National Association, Owner Trustee, and Wilmington Trust Company, Mortgagee) (Exhibit A-3 to Note Purchase Agreement 2000).
	4.1.34(1)	Form of Leased Aircraft Trust Agreement (Exhibit A-5 to Note Purchase Agreement 2000).
	4.1.35(1)	Form of Owned Aircraft Indenture (Trust Indenture and Mortgage between Atlas Air, Inc., Owner, and Wilmington Trust Company, as Mortgagee) (Exhibit C-2 to Note Purchase Agreement 2000).
	4.1.36(6)	Form of Leased Aircraft Indenture (Trust Indenture and Mortgage between First Security Bank, National Association, Owner Trustee, and Wilmington Trust Company, Mortgagee) (Exhibit A-3 to Note Purchase Agreement 2000).
	4.1.37(6)	Form of Leased Aircraft Trust Agreement (Exhibit A-5 to Note Purchase Agreement 2000).

Exhibit Number		Description
	4.1.38(6)	Form of Owned Aircraft Indenture (Trust Indenture and Mortgage between Atlas Air, Inc., Owner, and Wilmington Trust Company, as Mortgagee) (Exhibit C-2 to Note Purchase Agreement 2000).
	4.1.39**	Leased Aircraft Restructure Agreement with regard to Aircraft N491MC, dated July 27, 2004, by and among Atlas Air, Inc., Wells Fargo Bank Northwest, National Association as Owner Trustee, Wilmington Trust Company as Mortgagee, Class A Trustee and Subordination Agent, and DAF Investments, Ltd. as Owner Participant, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	4.1.40	1998 Class A Pass Through Trust Supplement, dated July 27, 2004, between the Company and Wilmington Trust Company as Class A Trustee.
	4.1.41	Amendment to 1999 Class A-1 Pass Through Trust Supplement, dated July 27, 2004, between Company and the Wilmington trust Company as Class A-1 Trustee.
	4.1.42	Amendment to 2000 Class A Pass Through Trust Supplement between the Company and Wilmington Trust Company as Class A Trustee dated July 27, 2004.
	10.1.1	Assignment and Assumption Agreement between the Company and the N491MC Owner Participant, dated July 27, 2004, pursuant to which the Company has exercised its option to purchase the entire owner participant interest with regard to Aircraft N491MC.
	10.1.2	Assignment and Assumption Agreement between the Company and the N493MC Owner Participant, dated July 27, 2004, pursuant to which the Company has exercised its option to purchase the entire owner participant interest with regard to Aircraft N493MC.
	10.1.3	Assignment and Assumption Agreement between the Company and the N496MC Owner Participant, dated July 27, 2004, pursuant to which the Company has exercised its option to purchase the entire owner participant interest with regard to Aircraft N496MC.
	10.1.4	Assignment and Assumption Agreement between the Company and the N409MC Owner Participant, dated July 27, 2004, pursuant to which the Company has exercised its option to purchase the entire owner participant interest with regard to Aircraft N409MC.
	10.2.1(7)	Agreement of Lease, dated November 9, 1999, between Texaco, Inc., Landlord, and the Company, Tenant, 2000 Westchester Avenue, White Plains, New York 10650.
	10.3.1**	Loan and Security Agreement, dated as of November 30, 2004, by and among Atlas Air, Inc., Polar Air Cargo, Inc. as Borrowers, the Company and Airline Acquisition Corp I as Guarantors, Congress Financial Corp. as Agent, Wachovia Bank, National Association as Lead Arranger and certain Lenders.
	10.3.2**	Aircraft Spare Parts Security Agreement, dated as of November 30, 2004, between Atlas Air, Inc. and Congress Financial Corporation.
	10.3.3**	Aircraft Spare Parts Security Agreement, dated as of November 30, 2004, between Polar Air Cargo, Inc. and Congress Financial Corporation.
	10.3.4**	Aircraft Engines Security Agreement, dated as of November 30, 2004, between Polar Air Cargo, Inc. and Congress Financial Corporation.
	10.3.5**	Aircraft Security Agreement – N921FT, dated as of November 30, 2004, between Polar Air Cargo, Inc. and Congress Financial Corporation.
	10.3.6**	Aircraft Security Agreement – N858FT, dated as of November 30, 2004, between Polar Air Cargo, Inc. and Congress Financial Corporation.

Exhibit Number		Description
	10.3.7**	Slot, Airport Leasehold and Routes Pledge and Security Agreement, dated as of November 30, 2004, between Polar Air Cargo, Inc. and Atlas Air, Inc. in favor of Congress Financial Corporation.
	10.3.8**	Trademark Collateral Assignment and Security Agreement, dated as of November 30, 2004, between Atlas Air, Inc. and Congress Financial Corporation.
	10.3.9**	Trademark Collateral Assignment and Security Agreement, dated as of November 30, 2004, between Polar Air Cargo, Inc. and Congress Financial Corporation.
	10.3.10**	Investment Property Pledge and Security Agreement, dated as of November 30, 2004, by Polar Air Cargo, Inc. in favor of Congress Financial Corporation.
	10.3.11**	Investment Property Pledge and Security Agreement, dated as of November 30, 2004, by Atlas Air, Inc. in favor of Congress Financial Corporation.
	10.3.12**	Pledge and Security Agreement, dated as of November 30, 2004, by Atlas Air, Inc. to and in favor of Congress Financial Corporation.
	10.3.13**	Guarantee, dated as of November 30, 2004, by the Company and Airline Acquisition Corp. I, in favor of Congress Financial Corporation.
	10.3.14**	Pledge and Security Agreement, dated as of November 30, 2004, by the Company, to and in favor of Congress Financial Corporation.
	10.3.15**	Investment Property Pledge and Security Agreement, dated as of November 30, 2004, by the Company, to and in favor of Congress Financial Corporation
	10.4.1(5)	Aircraft General Terms Agreement, dated June 6, 1997, between The Boeing Company and Atlas Air, Inc.
	10.5.1**	Fifth Amended and Restated Credit Agreement dated as of July 27, 2004 among Atlas Air, Inc. as Borrower, certain Lenders and Deutsche Bank Trust Company Americas as Administrative Agent (“Aircraft Credit Facility”).
	10.5.2	Guaranty, dated as of July 27, 2004, given by the Company relating to the Aircraft Credit Facility.
	10.5.3	Subsidiaries Guaranty, dated July 27, 2004, given by Polar Air Cargo, Inc. and Airline Acquisition Corp. I, relating to the Aircraft Credit Facility.
	10.5.4	Amendment No. 3 to First Security Agreement (N355MC), dated as of July 27, 2004, to secure obligations under the Aircraft Credit Facility, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.5.5	Amendment No. 3 to Second Security Agreement (N355MC), dated as of July 27, 2004, to secure obligations under the Aircraft Credit Facility, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.5.6	Amendment No. 4 to First Security Agreement (N355MC), dated as of November 30, 2004, to secure obligations under the Aircraft Credit Facility, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.5.7	Amendment No. 4 to Second Security Agreement (N355MC), dated as of November 30, 2004, to secure obligations under the Aircraft Credit Facility, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.6.1**	Amended and Restated Credit Agreement, dated as of July 27, 2004, among Atlas Freighter Leasing III, Inc., certain Lenders and Deutsche Bank Trust Company Americas as Administrative Agent (“AFL III Credit Agreement”).

Exhibit Number		Description
	10.6.2	First Amendment and Consent to Amended and Restated Credit Agreement dated as of November 30, 2004 relating to the AFL III Credit Agreement.
	10.6.3**	Amended and Restated Lease Agreement (N505MC), dated as of July 27, 2004, relating to the AFL III Credit Agreement, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.6.4	Lease Supplement No. 1 (N505MC), dated as of July 27, 2004, relating to the AFL III Credit Agreement, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.6.5	Amendment No. 1 to Amended and Restated Lease (N505MC), dated as of November 30, 2004, relating to the AFL III Credit Agreement, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.6.6	Amendment No. 2 to Amended and Restated Lease (N505MC), dated as of May 31, 2005, relating to the AFL III Credit Agreement, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.6.7	Amendment No. 3 to Security Agreement (N505MC), dated as of July 27, 2004, relating to the AFL III Credit Agreement, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.6.8	Amendment No. 4 to Security Agreement (N505MC), dated as of May 31, 2005, relating to the AFL III Credit Agreement, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.6.9	Holdings Guaranty (N505MC), dated as of July 27, 2004, given by the Company, relating to the AFL III Credit Agreement, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.6.10	Subsidiaries Guaranty (N505MC), dated as of July 27, 2004, given by Polar Air Cargo, Inc. and Aircraft Acquisition Corp. I, relating to the AFL III Credit Agreement, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.7.1**	Amendment Agreement, dated August 1, 2003, between Tuolumne River Aircraft Finance, Inc., as Lessor and Atlas Air, Inc. as Lessee in respect of Lease dated July 16, 2002 with respect to Aircraft N416MC, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.7.2**	Amended Restructuring Letter, dated August 1, 2003, between Tuolumne River Aircraft Finance, Inc., as Lessor and Atlas Air, Inc. as Lessee with respect to Aircraft N416MC, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.7.3	Acknowledgement and Agreement, dated November 18, 2003, given by the Company with respect to Aircraft N416MC, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.7.4	Acknowledgement and Agreement, dated November 18, 2003, given by Polar Air Cargo, Inc. with respect to Aircraft N416MC, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.7.5	Guaranty (N416MC), dated as of July 27, 2004, given by Polar Air Cargo, Inc., together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.

Exhibit Number		Description
	10.7.6	Guaranty (N416MC), dated as of July 27, 2004, given by the Company, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.8.1**	Amendment Agreement, dated August 1, 2003, between Polaris Aircraft Finance, Inc., as Lessor and Polar Air Cargo, Inc. as Lessee in respect of Lease dated October 24, 2001 with respect to Aircraft N920FT.
	10.8.2**	Restructuring Letter Agreement dated August 1, 2003 between Polaris Aircraft, Inc., as Lessor and Polar Air Cargo, Inc. as Lessee with respect to Aircraft N920FT.
	10.8.3	Acknowledgement and Agreement, dated November 18, 2003, given by the Company with respect to Aircraft N920FT.
	10.8.4	Acknowledgement, Consent and Agreement, dated November 18, 2003, given by the Company with respect to Aircraft N920FT.
	10.8.5	Guaranty (N920FT), dated as of July 27, 2004, given by Atlas Air, Inc. in favor of Polaris Aircraft, Inc.
	10.8.6	Guaranty (N920FT), dated as of July 27, 2004, given by the Company in favor of Polaris Aircraft, Inc.
	10.9.1**	Amendment Agreement, dated August 1, 2003, between General Electric Capital Corporation, as Sublessor and Polar Air Cargo, Inc. as Sublessee in respect of Sublease, dated October 24, 2001, with respect to Aircraft N450PA, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.9.2	Second Amendment Agreement, dated January 31, 2005, between General Electric Capital Corporation, as Sublessor and Polar Air Cargo, Inc. as Sublessee in respect of Sublease, dated October 24, 2001, with respect to Aircraft N450PA, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.9.3**	Acknowledgement, Consent and Agreement, dated January 31, 2005, given by the Company with respect to Aircraft N450PA, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.9.4**	Restructuring Letter Agreement, dated August 1, 2003, between General Electric Capital Corporation, as Sublessor and Polar Air Cargo, Inc. as Sublessee with respect to Aircraft N450PA, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.9.5**	Acknowledgement and Agreement, dated November 18, 2003, given by the Company with respect to Aircraft N450PA, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.9.6**	Acknowledgement and Agreement, dated November 18, 2003, given by Atlas Air, Inc. with respect to Aircraft N450PA, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.9.7**	Acknowledgement, Consent and Agreement, dated November 18, 2003, given by the Company with respect to Aircraft N450PA, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.9.8**	Guaranty (N450PA), dated as of July 27, 2004, given by Atlas Air, Inc. in favor of General Electric Capital Corporation, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.

Exhibit Number		Description
	10.9.9**	Guaranty (N450PA), dated as of July 27, 2004, given by the Company in favor of General Electric Capital Corporation, together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.10.1**	Amendment Agreement, dated August 1, 2003, between Charles River Aircraft Finance, Inc., as Lessor and Polar Air Cargo, Inc. as Lessee in respect of Lease Agreement dated July 24, 2002 with respect to Aircraft N454PA.
	10.10.2**	Second Amendment Agreement, dated January 31, 2005, between Charles River Aircraft Finance, Inc. as Lessor and Polar Air Cargo, Inc. as Lessee in respect of Lease Agreement, dated July 24, 2002, with respect to Aircraft N454PA.
	10.10.3**	Acknowledgement, Consent and Agreement, dated January 31, 2005, given by the Company with respect to Aircraft N454PA.
	10.10.4**	Restructuring Letter Agreement, dated August 1, 2003, between Charles River Aircraft Finance, Inc., as Lessor and Polar Air Cargo, Inc. as Lessee with respect to Aircraft N454PA.
	10.10.5**	Acknowledgement and Agreement, dated November 18, 2003, given by the Company with respect to Aircraft N454PA.
	10.10.6**	Acknowledgement and Agreement, dated November 18, 2003, given by Atlas Air, Inc. with respect to Aircraft N454PA.
	10.10.7**	Acknowledgement, Consent and Agreement, dated November 18, 2003, given by the Company with respect to Aircraft N454PA.
	10.10.8**	Guaranty (N454PA), dated as of July 27, 2004, given by Atlas Air, Inc. in favor of Charles River Aircraft Finance, Inc.
	10.10.9**	Guaranty (N454PA), dated as of July 27, 2004, given by the Company in favor of Charles River Aircraft Finance, Inc.
	10.11.1*(4)	Engine Maintenance Agreement, dated June 6, 1996, between Atlas Air, Inc. and General Electric Company.
	10.11.2**	Amendment No. 8 to ESD-96-232I, dated November 18, 2003, between Atlas Air, Inc. and GE Engine Services, Inc.
	10.12.1**	Engine Maintenance Contract, dated April 30, 2004, between the Company and MTU Maintenance Hannover GmbH, with regard to CF6 80C2 Engines in the 1998 EETC Transaction together with schedule of substantially identical documents omitted from filing pursuant to Rule 12b-31 promulgated under the Exchange Act.
	10.13.1**	Agreement, dated November 19, 1999, between Atlas Air, Inc. and MTU Maintenance Hannover GmbH, with regard to CF6 50E2 Engines.
	10.13.2**	Second Amendment to the Agreement, dated August 2, 2004, between Atlas Air, Inc. and MTU Maintenance Hannover GmbH, with regard to CF6 50E2 Engines.
	10.14.1**	Maintenance and Pool Agreement for Rotable Components B747-200/300/400F, dated June 19, 2003, between Atlas Air, Inc. and KLM Royal Dutch Airlines.
	10.15.1**	Contract, dated October 1, 2004, between HQ AMC/A34TM and the Company.
	10.16.1	Employment Agreement, dated as of April 1, 2005, between Atlas Air, Inc. and Jeffrey H. Erickson.
	10.17.1	Employment Agreement, dated as of February 1, 2003, between the Company and T. Wakelee Smith, as amended June 15, 2004.

Exhibit Number		Description
	10.18.1	Employment Agreement, dated as of May 1, 2003, between Atlas Air, Inc. and Ronald A. Lane, as amended January 24, 2004 and as amended April 20, 2004.
	10.19.1	Employment Agreement, dated as of April 1, 2005, between Atlas Air, Inc. and John W. Dietrich.
	10.20.1	Employment Agreement, dated as of November 1, 2000, between the Company and James R. Cato, as amended February 1, 2004.
	10.21.1	Benefits Program for Executive Vice Presidents and Senior Vice Presidents, dated March 1, 2005.
	10.22.1	Benefits Program for Vice Presidents, dated March 1, 2005.
	10.23.1(12)	Term Sheet for Michael L. Barna, effective as of April 11, 2005.
	10.24.1(13)	Term Sheet for Gordon L. Hutchinson, effective as of May 2, 2005.
	10.25.1	Board of Directors Compensation.
	10.26.1(2)	Atlas Air, Inc. Profit Sharing Plan.
	10.27.1(10)	Atlas Air Worldwide Holdings, Inc. 2004 Long Term Incentive and Share Award Plan.
	10.27.2(10)	Form of Restricted Share Agreement – Directors Version - 2004 Long Term Incentive and Share Award Plan.
	10.27.3(10)	Form of Restricted Share Agreement – Management Version – 2004 Long Term Incentive and Share Award Plan.
	10.27.4(11)	Form of Stock Option Agreement – Employee Version – 2004 Long Term Incentive and Share Award Plan.
	10.28.1	Atlas Air Worldwide Holdings, Inc. 2004 Employee Stock Option Plan.
	14.1.1(14)	Atlas Air Worldwide Holdings, Inc. Code of Ethics applicable to the Chief Executive Officer, Senior Financial Officers and members of the Board of Directors.
	21.1.1	Subsidiaries List.
	24.1.1	Power of Attorney.
	31.1.1	Certification pursuant to Section 302 of Sarbanes Oxley Act of 2002 by Chief Executive Officer.
	31.2.1	Certification pursuant to Section 302 of Sarbanes Oxley Act of 2002 by Chief Financial Officer.
	32.1.1	Certification of periodic financial report pursuant to Section 906 of Sarbanes Oxley Act of 2002.

(1)	Incorporated by reference to the exhibits to Atlas Air’s Registration Statement on Form S-4 (No. 333-36268).
(2)	Incorporated by reference to the exhibits to Atlas Air’s Registration Statement on Form S-1 (No. 33-90304).
(3)	Incorporated by reference to the exhibits to Atlas Air’s Annual Report on Form 10-K for the year ended December 31, 1997 (File No. 0-25732).
(4)	Incorporated by reference to the exhibits to Atlas Air’s Annual Report on Form 10-K for the year ended December 31, 1996 (File No. 0-25732).
(5)	Incorporated by reference to the exhibits to Atlas Air’s Registration Statement on Form S-4 (No. 333-36305).
(6)	Incorporated by reference to the exhibits to Atlas Air’s Registration Statement on Form S-3 (No. 333-71833).
(7)	Incorporated by reference to the exhibits to Atlas Air’s Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 0-25732).
(8)	Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K dated February 16, 2001 (File No. 0-25732).

(9)	Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K dated July 26, 2004. (File No. 001-16545).
(10)	Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K dated December 28, 2004 (File 001-16545).
(11)	Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K dated March 28, 2005 (File No. 0-25732).
(12)	Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K dated March 31, 2005 (File No. 001-16545).
(13)	Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K dated April 22, 2005. (File No. 001-16545).
(14)	Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K dated June 23, 2005 (File No. 001-16545).
*	Portions of this document, for which the Company has been granted confidential treatment, have been redacted and filed separately with the Securities and Exchange Commission.
**	To be filed by amendment in reliance on Rule 12b-21 promulgated under the Exchange Act. Due to unreasonable effort or expense, the exhibit could not be available at the time of filing of this report.

EX-3.2.1

                                                                   EXHIBIT 3.2.1










                       Atlas Air Worldwide Holdings, Inc.


                                     BY-LAWS

                                       of

                       ATLAS AIR WORLDWIDE HOLDINGS, INC.



                   * * * * * * * * * * * * * * * * * * * * * *

                               AS OF JULY 28, 2004









                                   ARTICLE I

                                    OFFICES

         Section 1. The registered office shall be in the City of Wilmington,
County of New Castle, State of Delaware.

         Section 2. The Corporation may also have offices at such other places
both within and without the State of Delaware as the Board of Directors may from
time to time determine or the business of the Corporation may require.

                                   ARTICLE II

                            MEETINGS OF STOCKHOLDERS

         Section 1. All meetings of the stockholders for the election of
Directors shall be held in the City of Purchase, State of New York, at such
place as may be fixed from time to time by the Board of Directors, or at such
other place either within or without the State of Delaware as shall be
designated from time to time by the Board of Directors and stated in the notice
of the meeting. Meetings of stockholders for any other purpose may be held at
such time and place, within or without the State of Delaware, as shall be stated
in the notice of the meeting or in a duly executed waiver of notice thereof.

         Section 2. Annual meetings of stockholders shall be held on the last
Thursday of May if not a legal holiday, and if a legal holiday, then on the next
secular day following, at 11:00 A.M., or at such other date and time as shall be
designated from time to time by the Board of Directors and stated in the notice
of the meeting, at which they shall elect by a plurality vote a Board of
Directors, and transact such other business as may properly be brought before
the meeting.

         Section 3. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the Certificate of
Incorporation, may be



                                       2



called by (i) the Chairman of the Board of Directors, (ii) the Chief Executive
Officer of the Corporation or (iii) the Board of Directors pursuant to a
resolution adopted by a majority of the total number of authorized Directors.

         Section 4. Whenever stockholders are required or permitted to take any
action at a meeting, unless notice is waived in writing by all stockholders
entitled to vote at the meeting, a written notice of the meeting shall be given
which shall state the place, date and hour of the meeting, and, in the case of a
special meeting, the purpose for which the meeting is called.

            Unless otherwise provided by law, and except as to any stockholder
duly waiving notice, the written notice of any meeting shall be given personally
or by mail, not less than ten nor more than 60 days before the date of the
meeting to each stockholder entitled to vote at such meeting. If mailed, notice
shall be deemed given when deposited in the mail, postage prepaid, directed to
the stockholder at his or her address as it appears on the records of the
Corporation.

            When a meeting is adjourned to another time or place, notice need
not be given of the adjourned meeting if the time and place thereof are
announced at the meeting at which the adjournment is taken. At the adjourned
meeting the Corporation may transact any business which might have been
transacted at the original meeting. If, however, the adjournment is for more
than thirty 30 days, or if after the adjournment a new record date is fixed for
the adjourned meeting, a notice of the adjourned meeting shall be given to each
stockholder of record entitled to vote at the meeting.

         Section 5. The officer who has charge of the stock ledger of the
Corporation shall prepare and make, at least ten (10) days before every meeting
of stockholders, a



                                       3


complete list of the stockholders entitled to vote at the meeting, arranged in
alphabetical order, and showing the address of each stockholder and the number
of shares registered in the name of each stockholder. Such list shall be open to
the examination of any stockholder, for any purpose germane to the meeting,
during ordinary business hours, for a period of at least ten (10) days prior to
the meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. The list shall also be
produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder who is present.

            The stock ledger shall be the only evidence as to which stockholders
are entitled to examine the stock ledger or the list required by this Section 5,
or to vote in person or by proxy at any meeting of shareholders.

         Section 6. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all meetings of the stockholders for the
transaction of business except as otherwise provided by statute or by the
Certificate of Incorporation. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders entitled to
vote thereat, present in person or represented by proxy, shall have power to
adjourn the meeting from time to time, without notice, except as provided in the
last paragraph of Section 4 of this Article II, until a quorum shall be present
or represented. At such adjourned meeting at which a quorum shall be present or
represented any business may be transacted which might have been transacted at
the meeting as originally notified.



                                       4


         Section 7. Except as otherwise provided by the Certificate of
Incorporation or these By-Laws, whenever Directors are to be elected at a
meeting, they shall be elected by a plurality of the votes cast at the meeting
by the holders of stock entitled to vote. Whenever any corporate action, other
than the election of Directors, is to be taken by vote of stockholders at a
meeting, it shall be authorized by a majority of the votes cast at the meeting
by the holders of stock entitled to vote thereon, except as otherwise required
by law, by the Certificate of Incorporation or by these By-Laws.

            Except as otherwise provided by law, or by the Certificate of
Incorporation or these By-Laws, each holder of record of stock of the
Corporation entitled to vote on any matter at any meeting of stockholders shall
be entitled to one vote for each share of such stock standing in the name of
such holder on the stock ledger of the Corporation on the record date for the
determination of the stockholders entitled to vote at the meeting.

            Upon the demand of any stockholder entitled to vote, the vote for
Directors or the vote on any other matter at a meeting shall be by written
ballot, but otherwise the method of voting and the manner in which votes are
counted shall be discretionary with the presiding officer at the meeting.

         Section 8. At every meeting of stockholders the Chairman of the Board,
or any Vice Chairman of the Board, or the Chief Executive Officer, as designated
by the Board of Directors, or, if none be present, or in the absence of any such
designation, the appointee of the meeting, shall preside. The Secretary, or in
his or her absence an Assistant Secretary, or if none be present, the appointee
of the presiding officer of the meeting, shall act as secretary of the meeting.


                                       5


         Section 9. Each stockholder entitled to vote at a meeting of
stockholders may authorize another person or persons to act for him or her by
proxy executed in writing by the stockholder or as otherwise permitted by law,
or by his or her duly authorized attorney-in-fact. Such proxy must be filed with
the Secretary of the Corporation or his or her representative at or before the
time of the meeting.

         Section 10. (A) Annual Meetings of Stockholders. (1) Nominations of
persons for election to the Board of Directors of the Corporation and the
proposal of business to be considered by the stockholders may be made at an
annual meeting of stockholders (a) pursuant to the Corporation's notice of
meeting delivered pursuant to Section 4 of Article II of these By-Laws, (b) by
or at the direction of the Board of Directors or (c) by any stockholder of the
Corporation who is entitled to vote at the meeting, who complied with the notice
procedures set forth in clauses (2) and (3) of paragraph (A) of this Section 10
and who was a stockholder of record at the time such notice is delivered to the
Secretary of the Corporation.

         (2) For nominations or other business to be properly brought before an
annual meeting by a stockholder pursuant to clause (c) of paragraph (A)(1) of
this Section 10, the stockholder must have given timely notice thereof in
writing to the Secretary of the Corporation. To be timely, a stockholder's
notice shall be delivered to the Secretary at the principal executive offices of
the Corporation not less than seventy days nor more than ninety days prior to
the first anniversary of the preceding year's annual meeting, or, in the case of
the Corporation's first annual meeting to be held after the initial adoption of
these By-Laws, the preceding year's annual meeting of Atlas Air, Inc., a
Delaware corporation; PROVIDED, HOWEVER, that in the event that the date of the
annual meeting is


                                       6


advanced by more than twenty days, or delayed by more than seventy days, from
such anniversary date, notice by the stockholder to be timely must be so
delivered not earlier than the ninetieth day prior to such annual meeting and
not later than the close of business on the later of the seventieth day prior to
such annual meeting or the tenth day following the day on which public
announcement of the date of such meeting is first made. Such stockholder's
notice shall set forth (a) as to each person whom the stockholder proposes to
nominate for election or reelection as a Director all information relating to
such person that is required to be disclosed in solicitations of proxies for
election of Directors, or is otherwise required, in each case pursuant to
Regulation 14A under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), including such person's written consent to being named in the
proxy statement as a nominee and to serving as a Director if elected; (b) as to
any other business that the stockholder proposes to bring before the meeting, a
brief description of the business desired to be brought before the meeting, the
reasons for conducting such business at the meeting and any material interest in
such business of such stockholder and the beneficial owner, if any, on whose
behalf the proposal is made; and (c) as to the stockholder giving the notice and
the beneficial owner, if any, on whose behalf the nomination or proposal is made
(i) the name and address of such stockholder, as they appear on the
Corporation's books, and of such beneficial owner and (ii) the class and number
of shares of the Corporation which are owned beneficially and of record by such
stockholder and such beneficial owner.

         (3) Notwithstanding anything in the second sentence of paragraph (A)(2)
of this Section 10 to the contrary, in the event that the number of Directors to
be elected to the Board of Directors is increased and there is no public
announcement naming all of the


                                       7


nominees for Director or specifying the size of the increased Board of Directors
made by the Corporation at least eighty days prior to the first anniversary of
the preceding year's annual meeting, a stockholder's notice required by this
Section 10 shall also be considered timely, but only with respect to nominees
for any new positions created by such increase, if it shall be delivered to the
Secretary at the principal executive offices of the Corporation not later than
the close of business on the tenth day following the day on which such public
announcement is first made by the Corporation.

         (B) Special Meeting of Stockholders. Only such business shall be
conducted at a special meeting of stockholders as shall have been brought before
the meeting pursuant to the Corporation's notice of meeting pursuant to Section
4 of Article II of these By-Laws. Nominations of persons for election to the
Board of Directors may be made at a special meeting of stockholders at which
Directors are to be elected pursuant to the Corporation's notice of meeting (i)
by or at the direction of the Board of Directors or (ii) by any stockholder of
the Corporation who is entitled to vote at the meeting, who complies with the
notice procedures set forth in this Section 10 and who is a stockholder of
record at the time such notice is delivered to the Secretary of the Corporation.
Nominations by stockholders of persons for election to the Board of Directors
may be made at such a special meeting of stockholders if the stockholder's
notice as required by paragraph (A)(2) of this Section 10 shall be delivered to
the Secretary at the principal executive offices of the Corporation not earlier
than the ninetieth day prior to such special meeting and not later than the
close of business on the later of the seventieth day prior to such special
meeting or the tenth day following the day on which public announcement is


                                       8


first made of the date of the special meeting and of the nominees proposed by
the Board of Directors to be elected at such meeting.

         (C) General. (1) Only persons who are nominated in accordance with the
procedures set forth in this Section 10 shall be eligible to serve as Directors
and only such business shall be conducted at a meeting of stockholders as shall
have been brought before the meeting in accordance with the procedures set forth
in this Section 10. Except as otherwise provided by law, the Certificate of
Incorporation or these By-Laws, the Chairman of the meeting shall have the power
and duty to determine whether a nomination or any business proposed to be
brought before the meeting was made in accordance with the procedures set forth
in this Section 10 and, if any proposed nomination or business is not in
compliance with this Section 10, to declare that such defective proposal or
nomination shall be disregarded.

                           (2) For purposes of this Section 10, "public
announcement" shall mean disclosures in a press release reported by the Dow
Jones News Service, Associated Press or comparable national news service or in a
document publicly filed by the Corporation with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.

                           (3) Notwithstanding the foregoing provisions of this
Section 10, a stockholder shall also comply with all applicable requirements of
the Exchange Act and the rules and regulations thereunder with respect to the
matters set forth in this Section 10. Nothing in this Section 10 shall be deemed
to affect any rights of stockholders to request inclusion of proposals in the
Corporation's proxy statement pursuant to Rule 14a-8 under the Exchange Act.



                                       9


         Section 11. The Board of Directors by resolution shall appoint one or
more inspectors, which inspector or inspectors may include individuals who serve
the Corporation in other capacities, including, without limitation, as officers,
employees, agents or representatives of the Corporation, to act at the meeting
and make a written report thereof. One or more persons may be designated as
alternate inspectors to replace any inspector who fails to act. If no inspector
or alternate has been appointed to act, or if all inspectors or alternates who
have been appointed are unable to act, at the meeting of stockholders, the
Chairman of the meeting shall appoint one or more inspectors to act at the
meeting. Each inspector, before discharging his or her duties, shall take and
sign an oath faithfully to execute the duties of inspector with strict
impartiality and according to the best of his or her ability. The inspectors
shall have the duties prescribed by the General Corporation Law of the State of
Delaware (the "GCL").

                  The Chairman of the meeting shall fix and announce at the
meeting the time of the opening and the closing of the polls for each matter
upon which the stockholders will vote at a meeting.

                                  ARTICLE III

                                    DIRECTORS

         Section 1. The number of Directors which shall constitute the whole
Board shall be not less than 1 nor more than 11. The first Board shall consist
of one Director. Thereafter, within the limits above specified, the number of
Directors shall be determined by resolution of the Board of Directors or by the
stockholders at the annual meeting. The Directors shall be elected at the annual
meeting of the stockholders, except as provided in Section 2 of this Article,
and each Director elected shall hold office until his successor is elected and
qualified. Except as otherwise permitted by or consistent with applicable



                                       10



statutory, regulatory and interpretive restrictions regarding foreign ownership
or control of U.S. air carriers, at no time shall more than one-third of the
Directors in office be Aliens (as defined in the Certificate of Incorporation).
Directors need not be stockholders.

         Section 2. Vacancies and newly created directorships resulting from any
increase in the authorized number of Directors may be filled by a majority of
the Directors then in office, though less than a quorum, or by a sole remaining
Director, and the Directors so chosen shall hold office until the next annual
election and until their successors are duly elected and shall qualify, unless
sooner displaced. If there are no Directors in office, then an election of
Directors may be held in the manner provided by statute. If, at the time of
filling any vacancy or any newly created directorship, the Directors then in
office shall constitute less than a majority of the whole Board (as constituted
immediately prior to any such increase), the Court of Chancery may, upon
application of any stockholder or stockholders holding at least ten percent of
the total number of the shares at the time outstanding having the right to vote
for such Directors, summarily order an election to be held to fill any such
vacancies or newly created directorships, or to replace the Directors chosen by
the Directors then in office.

         Section 3. The business of the Corporation shall be managed by or under
the direction of its Board of Directors which may exercise all such powers of
the Corporation and do all such lawful acts and things as are not by statute or
by the Certificate of Incorporation or by these By-Laws directed or required to
be exercised or done by the stockholders.




                                       11


                                   ARTICLE IV

                       CHAIRMAN OF THE BOARD OF DIRECTORS

         Section 1. The Board of Directors in its discretion may elect a
Chairman of the Board of Directors and may also choose one or more Vice-Chairman
of the Board. The Chairman of the Board of Directors shall be a Director. He
shall preside at all meetings of stockholders and of the Board of Directors at
which he shall be present, and he shall perform such other duties and enjoy such
other powers as shall be delegated to him by the Board of Directors or which are
or may at any time be required by law.

         Section 2. Each Vice Chairman of the Board, in the absence of the
Chairman of the Board, shall have all powers herein conferred upon the Chairman
of the Board. In addition, each Vice Chairman shall have such other powers and
duties as may be delegated to him or her by the Board of Directors.

         Section 3. The Chairman and any Vice-Chairman of the Corporation shall
hold office until their successors are chosen and qualify. Any Chairman or
Vice-Chairman elected or appointed by the Board of Directors may be removed at
any time by the affirmative vote of a majority of the Board of Directors.

                                   ARTICLE V

                       MEETINGS OF THE BOARD OF DIRECTORS

         Section 1. The Board of Directors of the Corporation may hold meetings,
both regular and special, either within or without the State of Delaware at such
place as is indicated in the notice or waiver of notice thereof.

         Section 2. The first meeting of each newly elected Board of Directors
shall be held at such time and place as shall be fixed by the vote of the
stockholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected Directors



                                       12


in order legally to constitute the meeting, provided a quorum shall be present.
In the event of the failure of the stockholders to fix the time or place of such
first meeting of the newly elected Board of Directors, or in the event such
meeting is not held at the time and place so fixed by the stockholders, the
meeting may be held at such time and place as shall be specified in a notice
given as hereinafter provided for special meetings of the Board of Directors, or
as shall be specified in a written waiver signed by all of the Directors.

         Section 3. Regular meetings of the Board of Directors shall be held on
such date and at such times and places as shall be designated from time to time
by the Board of Directors; PROVIDED, that the Board shall hold at least four (4)
regular meetings in each year; PROVIDED, FURTHER, that the regular meetings of
the Board of Directors can be waived at the request of the Chief Executive
Officer if at least a majority of the Directors agree in writing to such waiver
at least seven days before the date of the meeting to be so waived except that
in any event the Board shall hold at least four (4) regular meetings in each
year. The Secretary shall forward to each Director, at least five days before
any such regular meeting, a notice of the time and place of the meeting,
together with the reports and recommendations of any committee of the Board of
Directors required to deliver periodic reports and the agenda for the meeting
prepared by the Chief Executive Officer or in lieu thereof a notice of waiver if
the regular meeting has been waived.

         Section 4. Special meetings of the Directors may be called by the
Chairman of the Board, any Vice Chairman, the Chief Executive Officer or a
majority of the Directors, at such time and place as shall be specified in the
notice or waiver thereof. Notice of each special meeting, including the time and
place of the meeting and the agenda


                                       13


therefor, shall be given by the Secretary or by the person calling the meeting
to each Director by causing the same to be delivered personally or by facsimile
transmission not later than the close of business on the second day next
preceding the day of the meeting.

         Section 5. Members of the Board of Directors, or of any committee
designated by the Board, may participate in a meeting of the Board of Directors
or such committee by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and participation in a meeting by such means shall constitute
presence in person at such meeting.

         Section 6. At all meetings of the Board a majority of the Directors
shall constitute a quorum for the transaction of business and the act of a
majority of the Directors present at any meeting at which there is a quorum
shall be the act of the Board of Directors, except as may be otherwise
specifically provided by statute or by the Certificate of Incorporation. If a
quorum shall not be present at any meeting of the Board of Directors the
Directors present thereat may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum shall be present.

         Section 7. Unless otherwise restricted by the Certificate of
Incorporation or these By-Laws, any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee thereof may be taken
without a meeting, if all members of the Board or committee, as the case may be,
consent thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the board or committee.

         Section 8. Unless otherwise restricted by the Certificate of
Incorporation or these By-Laws, members of the Board of Directors, or any
committee designated by the Board of Directors, may participate in a meeting of
the Board of Directors, or any


                                       14


committee, by means of conference telephone or similar communications equipment
but by means of which all persons participating in the meeting can hear each
other, and such participation in a meeting shall constitute presence in person
at the meeting.

                                   ARTICLE VI

                             COMMITTEES OF DIRECTORS

         Section 1. The Board of Directors may, by resolution passed by a
majority of the whole Board, designate one or more committees, each committee to
consist of one or more of the Directors of the Corporation. The Board may
designate, subject to the requirements of such committee's charter and
applicable laws, rules and regulations, one or more Directors as alternate
members of any committee, who may replace any absent or disqualified member at
any meeting of the committee.

                  In the absence or disqualification of a member of a committee,
the member or members thereof present at any meeting and not disqualified from
voting, whether or not he or they constitute a quorum, may unanimously appoint,
subject to the requirements of such committee's charter and applicable laws,
rules and regulations, another member of the Board of Directors to act at the
meeting in the place of any such absent or disqualified member.

                  Any such committee, to the extent provided in the resolution
of the Board of Directors, shall have and may exercise all the powers and
authority of the Board of Directors in the management of the business and
affairs of the Corporation, and may authorize the seal of the Corporation to be
affixed to all papers which may require it; but no such committee shall have the
power or authority in reference to amending the Certificate of Incorporation
(except that a committee may, to the extent authorized in the resolution or
resolutions providing for the issuance of shares of stock adopted by the


                                       15


Board of Directors as provided in Section 151(a) of the GCL, fix any of the
preferences or rights of such shares relating to dividends, redemption,
dissolution, any distribution of assets of the Corporation or the conversion
into, or the exchange of such shares for, shares of any other class or classes
or any other series of the same or any other class or classes of stock of the
Corporation), adopting an agreement of merger or consolidation, recommending to
the stockholders the sale, lease or exchange of all or substantially all of the
Corporation's property and assets, recommending to the stockholders a
dissolution of the Corporation or a revocation of a dissolution, or amending the
By-Laws of the Corporation; and, unless the resolution or the Certificate of
Incorporation expressly so provide, no such committee shall have the power or
authority to declare a dividend or to authorize the issuance of stock or to
adopt a certificate of ownership and merger. Such committee or committees shall
have such name or names as may be determined from time to time by resolution
adopted by the Board of Directors.

         Section 2. A Chairman of each committee shall be selected by the Board
of Directors to serve for such term as the Board of Directors may determine.
Subject to any requirements of the applicable committee charter and applicable
laws, rules and regulations, each committee shall fix its own rules of procedure
and shall meet at such times and places and upon such call or notice as shall be
provided by such rules. Each committee shall keep regular minutes of its
meetings and report the same to the Board of Directors when required.

         Section 3. The Board of Directors may, in its discretion designate
annually an Executive Committee consisting of not less than three Directors as
it may, from time to time determine, subject to applicable laws, rules and
regulations. The Committee shall




                                       16


have and may exercise such powers and authority of the Board of Directors in the
management of the business and affairs of the corporation as the Board of
Directors may from time to time prescribe, subject to applicable laws, rules and
regulations; PROVIDED, HOWEVER, that to the extent prohibited by law, the
Executive Committee shall not have the power or authority of the Board of
Directors in respect of (1) approving or adopting, or recommending to the
stockholders, any action or matter expressly required by the GCL to be submitted
to the stockholders of the Company for approval or (2) adopting, amending or
repealing any By-Law of the Company.

         Section 4. The Board of Directors shall designate annually an Audit and
Governance Committee comprised of three or more Directors. Such committee shall
satisfy the requirements of applicable laws, rules and regulations regarding its
composition and the qualifications of its members. The Audit and Governance
Committee shall conduct its activities and govern itself in accordance with the
requirements of an Audit and Governance Committee Charter adopted and from time
to time amended by the Board of Directors.

         Section 5. The Board of Directors shall designate annually a
Compensation Committee comprised of three or more Directors. Such committee
shall satisfy the requirements of applicable laws, rules and regulations
regarding its composition and the qualifications of its members. The
Compensation Committee shall conduct its activities and govern itself in
accordance with the requirements of a Compensation Committee Charter adopted and
from time to time amended by the Board of Directors.

         Section 6. The Board of Directors may designate a Nominating Committee
comprised of three or more independent Directors (as defined below) of the
Corporation.



                                       17


Such committee, if appointed, shall satisfy the requirements of applicable laws,
rules and regulations regarding its composition and the qualifications of its
members. The Nominating Committee, if appointed, shall conduct its activities
and govern itself in accordance with the requirements of a Nominating Committee
Charter adopted and from time to time amended by the Board of Directors. For
purposes of this Section 20, the term "independent directors" shall have the
meaning ascribed to such term under the rules of the Nasdaq Stock market or, if
different, the primary exchange on which the common stock of the Corporation is
listed for trading.

         Section 7. At each meeting of any committee the presence of a majority
of the members of such committee, whether regular or alternate, shall be
necessary to constitute a quorum for the transaction of business, and if a
quorum is present the concurrence of a majority of those present shall be
necessary for the taking of any action; PROVIDED, HOWEVER, that no action may be
taken by the Executive Committee when two or more officers of the corporation
are present as members at a meeting of such committee unless such action shall
be concurred in by the vote of two or more members of such committee who are not
officers of the corporation.

                                   ARTICLE VII

                            COMPENSATION OF DIRECTORS

         Section 1. Unless otherwise restricted by the Certificate of
Incorporation or these By-Laws, the Board of Directors shall have the authority
to fix the compensation of Directors. The Directors may be paid their expenses,
if any, of attendance at each meeting of the Board of Directors and may be paid
a fixed sum for attendance at each meeting of the Board of Directors or a stated
salary as Director. No such payment shall preclude any Director from serving the
Corporation in any other capacity and receiving


                                       18


compensation therefor. Members of special or standing committees may be allowed
like compensation for attending committee meetings.

                                  ARTICLE VIII

                              REMOVAL OF DIRECTORS

         Section 1. Unless otherwise restricted by the Certificate of
Incorporation or by law, any Director or the entire Board of Directors may be
removed, with or without cause, by the holders of a majority of shares entitled
to vote at an election of Directors.

                                   ARTICLE IX

                                     NOTICES

         Section 1. Whenever, under the provisions of the statutes or of the
Certificate of Incorporation or of these By-Laws, notice is required to be given
to any Director or stockholder, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
Director or stockholder, at his address as it appears on the records of the
Corporation, with postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same shall be deposited in the United States mail.
Notice to Directors may also be given by telegram.

         Section 2. Whenever any notice is required to be given under the
provisions of the statutes or of the Certificate of Incorporation or of these
By-Laws, a waiver thereof in writing, signed by the person or persons entitled
to said notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.

                                    ARTICLE X

                                    OFFICERS

         Section 1. The officers of the Corporation shall be chosen by the Board
of Directors and shall be a Chief Executive Officer, a President, a
Vice-President, a


                                       19


Secretary and a Treasurer. The Board of Directors may also choose additional
Vice-Presidents, and one or more Assistant Secretaries and Assistant Treasurers.
Any number of offices may be held by the same person, unless the Certificate of
Incorporation or these By-Laws otherwise provide.

         Section 2. The Board of Directors at its first meeting after each
annual meeting of stockholders shall choose a Chief Executive Officer, a
President, one or more Vice-Presidents, a Secretary and a Treasurer.

         Section 3. The Board of Directors may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the Board of Directors.

         Section 4. The salaries of all officers and agents of the Corporation
shall be fixed by the Board of Directors or the Compensation Committee of the
Board.

         Section 5. The officers of the Corporation shall hold office until
their successors are chosen and qualify. Any officer elected or appointed by the
Board of Directors may be removed at any time by the affirmative vote of a
majority of the Board of Directors. Any vacancy occurring in any office of the
Corporation shall be filled by the Board of Directors.

                                   ARTICLE XI

                             CHIEF EXECUTIVE OFFICER

         Section 1. In the absence of the Chairman of the Board of Directors,
the Chief Executive Officer shall preside at all meetings of the stockholders
and the Board of Directors. He shall have general and active management of the
business of the


                                       20


Corporation and shall see that all orders and resolutions of the Board of
Directors are carried into effect.

         Section 2. The Chief Executive Officer shall execute bonds, mortgages
and other contracts requiring a seal, under the seal of the Corporation, except
where required or permitted by law to be otherwise signed and executed and
except where the signing and execution thereof shall be expressly delegated by
the Board of Directors to some other officer or agent of the Corporation.

                                   ARTICLE XII

                                    PRESIDENT

         Section 1. The President shall perform all the duties and enjoy all the
powers commonly incident to his office or delegated to him or which are, or may
be, authorized or required by law. In the absence of the Chairman of the Board
of Directors, he shall have and perform the duties of that office.

                                  ARTICLE XIII

                               THE VICE-PRESIDENTS

         Section 1. In the absence of the President or in the event of his
inability or refusal to act, the Vice-President (or in the event there be more
than one Vice-President, the Vice-Presidents in the order designated by the
Directors, or in the absence of any designation, then in the order of their
election) shall perform the duties of the President, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
President. The Vice-Presidents shall perform such other duties and have such
other powers as the Board of Directors may from time to time prescribe.



                                       21



                                  ARTICLE XIV

                      THE SECRETARY AND ASSISTANT SECRETARY

         Section 1. The Secretary shall attend all meetings of the Board of
Directors and all meetings of the stockholders and record all the proceedings of
the meetings of the Corporation and of the Board of Directors in a book to be
kept for that purpose and shall perform like duties for the standing committees
when required. He shall give, or cause to be given, notice of all meetings of
the stockholders and special meetings of the Board of Directors, and shall
perform such other duties as may be prescribed by the Board of Directors or
Chief Executive Officer, under whose supervision he shall be. He shall have
custody of the corporate seal of the Corporation and he, or an Assistant
Secretary, shall have authority to affix the same to any instrument requiring it
and when so affixed, it may be attested by his signature or by the signature of
such Assistant Secretary. The Board of Directors may give general authority to
any other officer to affix the seal of the Corporation and to attest the
affixing by his signature.

         Section 2. The Assistant Secretary, or if there be more than one, the
Assistant Secretaries in the order determined by the Board of Directors (or if
there be no such determination, then in the order of their election) shall, in
the absence of the Secretary or in the event of his inability or refusal to act,
perform the duties and exercise the powers of the Secretary and shall perform
such other duties and have such other powers as the Board of Directors may from
time to time prescribe.

                                   ARTICLE XV

                     THE TREASURER AND ASSISTANT TREASURERS

         Section 1. The Treasurer shall have the custody of the corporate funds
and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the Corporation and shall deposit all moneys
and other valuable


                                       22


effects in the name and to the credit of the Corporation in such depositories as
may be designated by the Board of Directors.

         Section 2. He shall disburse the funds of the Corporation as may be
ordered by the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the President and the Board of Directors, at
its regular meetings, or when the Board of Directors so requires, an account of
all his transactions as treasurer and of the financial condition of the
Corporation.

         Section 3. If required by the Board of Directors, he shall give the
Corporation a bond (which shall be renewed every six years) in such sum and with
such surety or sureties as shall be satisfactory to the Board of Directors for
the faithful performance of the duties of his office and for the restoration to
the Corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the Corporation.

         Section 4. The Assistant Treasurer, or if there shall be more than one,
the Assistant Treasurers in the order determined by the Board of Directors (or
if there be no such determination, then in the order of their election) shall,
in the absence of the treasurer or in the event of his inability or refusal to
act, perform the duties and exercise the powers of the treasurer and shall
perform such other duties and have such other powers as the Board of Directors
may from time to time prescribe.

                                  ARTICLE XVI

                             CERTIFICATES FOR SHARES

         Section 1. The shares of the Corporation shall be represented by a
certificate or shall be uncertificated. Certificates shall be signed by, or in
the name of the Corporation


                                       23


by the Chairman or Vice-Chairman of the Board of Directors, the Chief Executive
Officer, or the President or a Vice-President, and by the Treasurer or an
Assistant Treasurer, or the Secretary or an Assistant Secretary of the
Corporation.

                  Within a reasonable time after the issuance or transfer of
uncertificated stock, the Corporation shall send to the registered owner thereof
a written notice containing the information required to be set forth or stated
on certificates pursuant to Sections 151, 156, 202(a) or 218(a) of the GCL or a
statement that the Corporation will furnish without charge to each stockholder
who so requests the powers, designations, preferences and relative
participating, optional or other special rights of each class of stock or series
thereof and the qualifications, limitations or restrictions of such preferences
and/or rights.

         Section 2. Any of or all the signatures on a certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the Corporation with the same effect as if he were
such officer, transfer agent or registrar at the date of issue.

                                  ARTICLE XVII

                                LOST CERTIFICATES

         Section 1. The Board of Directors or any officer of the Corporation may
direct a new certificate or certificates or uncertificated shares to be issued
in place of any certificate or certificates theretofore issued by the
Corporation alleged to have been lost, stolen or destroyed, upon the making of
an affidavit of that fact by the person claiming the certificate of stock to be
lost, stolen or destroyed. When authorizing such issue of a new certificate or
certificates or uncertificated shares, the Board of Directors or any


                                       24


officer may, in its/his/her discretion and as a condition precedent to the
issuance thereof, require the owner of such lost, stolen or destroyed
certificate or certificates, or his legal representative, to advertise the same
in such manner as it/he/she shall require and/or to give the Corporation a bond
in such sum as it may direct as indemnity against any claim that may be made
against the Corporation with respect to the certificate alleged to have been
lost, stolen or destroyed.

                                  ARTICLE XVIII

                                TRANSFER OF STOCK

         Section 1. Upon surrender to the Corporation or the transfer agent of
the Corporation of a certificate for shares duly endorsed or accompanied by
proper evidence of succession, assignation or authority to transfer, it shall be
the duty of the Corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
Upon receipt of proper transfer instructions from the registered owner of
uncertificated shares such uncertificated shares shall be canceled and issuance
of new equivalent uncertificated shares or certificated shares shall be made to
the person entitled thereto and the transaction shall be recorded upon the books
of the Corporation.

                                  ARTICLE XIX

                               FIXING RECORD DATE

         Section 1. In order that the Corporation may determine the stockholders
entitled to notice of or to vote at any meeting of stockholders or any
adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the


                                       25


purpose of any other lawful action, the Board of Directors may fix, in advance,
a record date, which shall not be more than sixty nor less than ten days before
the date of such meeting, nor more than sixty days prior to any other action. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; PROVIDED,
HOWEVER, that the Board of Directors may fix a new record date for the adjourned
meeting.

                                   ARTICLE XX

                             REGISTERED STOCKHOLDERS

         Section 1. The Corporation shall be entitled to recognize the exclusive
right of a person registered on its books as the owner of shares to receive
dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the laws of
Delaware.

                                  ARTICLE XXI

                               OWNERSHIP BY ALIENS

         Section 1. Foreign Stock Record. There shall be maintained a separate
stock record, designated the "Foreign Stock Record," for the registration of
Voting Stock, as defined in Section 2, that is Beneficially Owned (as defined in
the Certificate of Incorporation) by aliens, as defined in the Certificate of
Incorporation ("Alien Stock"). The Beneficial Ownership by aliens of Voting
Stock shall be determined in conformity with regulations prescribed by the Board
of Directors.


                                       26


         Section 2. Maximum Percentages. At no time shall ownership of shares
representing more than the Maximum Percentage, as defined below, be registered
in the Foreign Stock Record. As used herein, (a) "Maximum Percentage" means the
maximum percentage of voting power of Voting Stock, as defined below, which may
be voted by, or at the direction of, Aliens without violating applicable
statutory, regulatory and interpretive restrictions regarding foreign ownership
or control of U.S. air carriers or adversely affecting the Corporation's
operating certificates or authorities, and (b) "Voting Stock" means all
outstanding shares of capital stock of the Corporation issued from time to time
by the Corporation which, by their terms may vote (at the time such
determination is made) for the election of Directors of the Corporation, except
shares of Preferred Stock that are entitled to vote for the election of
Directors solely as a result of the failure to pay dividends by the Corporation
or other breach of the terms of such Preferred Stock.

         Section 3. Recording of Shares. If at any time there exist shares of
Voting Stock that are Alien Stock but that are not registered in the Foreign
Stock Record, the Beneficial Owner thereof may request, in writing, the
Corporation to register ownership of such shares on the Foreign Stock Record and
the Corporation shall comply with such request, subject to the limitation set
forth in Section 2. The order in which Alien Stock shall be registered on the
Foreign Stock Record shall be chronological, based on the date the Corporation
received a written request to so register such shares of Alien Stock. If at any
time the Corporation shall find that the combined voting power of Voting Stock
then registered in the Foreign Stock Record exceeds the Maximum Percentage,
there shall be removed from the Foreign Stock Record the registration of such
number of shares so registered as is sufficient to reduce the combined voting
power of the shares so registered


                                       27


to an amount not in excess of the Maximum Percentage. The order in which such
shares shall be removed shall be reverse chronological order based upon the date
the Corporation received a written request to so register such shares of Alien
Stock.

                                  ARTICLE XXII

                         GENERAL PROVISIONS - DIVIDENDS

         Section 1. Dividends upon the capital stock of the Corporation, subject
to the provisions of the Certificate of Incorporation, if any, may be declared
by the Board of Directors at any regular or special meeting, pursuant to law.
Dividends may be paid in cash, in property, or in shares of the capital stock,
subject to the provisions of the Certificate of Incorporation.

         Section 2. Before payment of any dividend, there may be set aside out
of any funds of the Corporation available for dividends such sum or sums as the
Directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation, or for such other
purpose as the Directors shall think conducive to the interest of the
Corporation, and the Directors may modify or abolish any such reserve in the
manner in which it was created.

                                 ARTICLE XXIII

                                ANNUAL STATEMENT

         Section 1. The Board of Directors shall present at each annual meeting
a full and clear statement of the business and condition of the Corporation.



                                       28


                                  ARTICLE XXIV

                                     CHECKS

         Section 1. All checks or demands for money and notes of the Corporation
shall be signed by such officer or officers or such other person or persons as
the Board of Directors may from time to time designate.

                                  ARTICLE XXV

                                   FISCAL YEAR

         Section 1. The fiscal year of the Corporation shall be fixed by
resolution of the Board of Directors.

                                  ARTICLE XXVI

                                      SEAL

         Section 1. The corporate seal shall have inscribed thereon the name of
the Corporation and the words "Corporate Seal, Delaware." The seal may be used
by causing it or a facsimile thereof to be impressed or affixed or reproduced or
otherwise.

                                 ARTICLE XXVII

                                 INDEMNIFICATION

         Section 1. Any person made a party or threatened to be made a party to
a threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action or suit by or in
the right of the Corporation to procure a judgment in its favor) by reason of
the fact that he is or was a Director or officer of the Corporation, or is or
was serving at the request of the Corporation as a Director or officer of
another corporation, partnership, joint venture, trust or other enterprise,
including service with respect to an employee benefit plan, shall be indemnified
by the Corporation against expenses (including attorneys' fees), judgment, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding to the fullest extent authorized
by the


                                       29


GCL as the same exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that such amendment permits the Corporation to
provide broader indemnification rights than said law permitted the Corporation
to provide prior to such amendment). The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of NOLO
CONTENDERE or its equivalent, shall not, of itself, create a presumption that
the person did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Corporation, or,
with respect to any criminal action or proceeding, that the person had
reasonable cause to believe that his conduct was unlawful.

         Section 2. Any person made a party or threatened to be made a party to
any threatened, pending or completed action or suit by or in the right of the
Corporation to procure a judgment in its favor by reason of the fact that he is
or was a Director or officer of the Corporation, or is or was serving at the
request of the Corporation as a Director or officer of another corporation,
partnership, joint venture, trust or other enterprise, including service with
respect to an employee benefit plan, shall be indemnified by the Corporation
against expenses (including attorneys' fees), judgment, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action or suit to the fullest extent authorized by the GCL as the same exists or
may hereafter be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation to provide prior
to such amendment) except that no indemnification shall be made hereunder in
respect of any claim, issue or matter as to which the person shall be adjudged
liable to the Corporation unless and only to the extent


                                       30


that the court of Chancery of the State of Delaware or the court in which such
action or suit was brought shall determine upon application that, despite the
adjudication of liability, but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which said Court of Chancery or such other court shall deem proper.

         Section 3. The indemnification and advancement of expenses provided by,
or granted pursuant to, this Section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a Director
or officer and shall inure to the benefit of the heirs, executors and
administrators of such a person.

         Section 4. Insurance. The Board of Directors of the Corporation may, in
its discretion, authorize the Corporation to purchase and maintain insurance on
behalf of any person who is or was a Director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
Director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise including service with respect to an employee
benefit plan, against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status as such, whether or not the
Corporation would have the power to indemnify him against such liability under
the provisions of Section 3 of this Article IX.

                                 ARTICLE XXVIII

                                   AMENDMENTS

         Section 1. The Board of Directors is expressly authorized to adopt,
repeal, alter or amend these By-Laws by the vote of a majority of the entire
Board of Directors. In addition, the stockholders of the Corporation may adopt,
repeal, alter or amend provisions of these By-Laws upon the affirmative vote of
the holders of 66 2/3% of the




                                       31


combined voting power of the then outstanding stock of the Corporation entitled
to vote generally in the election of Directors.





















                                       32

EX-4.1.40

                                                                  EXHIBIT 4.1.40


                                                                  EXECUTION COPY
                                                           1998 EETC TRANSACTION

                   1998 CLASS A PASS THROUGH TRUST SUPPLEMENT

      THIS PASS  THROUGH  TRUST  SUPPLEMENT  is made as of the 27th day of July,
2004 (this "TRUST  SUPPLEMENT"),  by and between ATLAS AIR, INC. (the "COMPANY")
and WILMINGTON TRUST COMPANY (the "TRUSTEE"),  as Trustee under the Pass Through
Trust  Agreement  dated as of  February  9, 1998,  between  the  Company and the
Trustee with respect to the formation of Atlas Air Pass Through Trust  1998-1A-S
(as amended from time to time, the "TRUST AGREEMENT").

                             PRELIMINARY STATEMENT

      As contemplated by the Restructure Agreements,  dated as of July 27, 2004,
among  the  Company,   the  Trustee  and  the  other   parties   named   therein
(collectively, the "RESTRUCTURE AGREEMENTS"), the Company and the Trustee desire
to enter into this Trust Supplement.

      NOW,  THEREFORE,  for good and  valuable  consideration,  the  receipt and
sufficiency  of which are  hereby  acknowledged,  the  parties  hereto  agree as
follows:

1. DEFINED TERMS.

      Capitalized  terms used and not  otherwise  defined  herein shall have the
same meanings given to them in the Trust Agreement.

2. AMENDMENTS TO TRUST AGREEMENT.

      The Trust Agreement is amended as follows:

      (a)   The  following  Section  12.15 is added after  Section  12.14 of the
            Trust Agreement:

            "12.15 ADDITIONAL PROVISIONS REGARDING LEASES AND INDENTURES.

                  (a) The Trustee and the Company acknowledge and agree that (i)
            each of the Leases has been amended by a certain  amendment dated as
            of July 27, 2004  between the Owner  Trustee  named  therein and the
            Company (collectively, the "Lease Amendments"), and (ii) each of the
            Indentures has been amended by a certain supplement dated as of July
            27, 2004  between the Company or the Owner  Trustee (as  applicable)
            named therein and the Mortgagee  named  therein  (collectively,  the
            "Indenture Supplements").  As of the Restructure Agreement Execution
            Date, (x) all  references  herein to the Leases shall mean and refer
            to the  Leases as  amended  by the Lease  Amendments  and as further
            amended  from  time  to  time,  (y)  all  references  herein  to the
            Indentures  shall mean and refer to the Indentures as amended by the
            Indenture  Supplements and as further amended from time to time, and
            (z) all capitalized terms used herein without  definition shall have
            the respective meanings specified in the Leases, as amended by the



            Lease Amendments, and in the Indentures, as amended by the Indenture
            Supplements.

                  (b) The Trustee and the Company  agree that in addition to the
            duties and  responsibilities  of the Trustee hereunder,  the Trustee
            shall also, on and after the Restructure  Agreement  Execution Date,
            have the following duties and responsibilities:

                        (i) As promptly  as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of any notice regarding any  Enhancements  pursuant to
                  the Leases or the  Indentures,  the Trustee shall  transmit by
                  mail  to  the   Certificateholders   holding  Certificates  in
                  accordance  with Section 313(c) of the Trust  Indenture Act, a
                  copy of such notice.

                        (ii) As promptly as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee  of a  request  by the  Company  to sell an  Owned  or
                  Controlled Aircraft as required pursuant to the Leases and the
                  Indentures  upon the  occurrence of a Sale Trigger Event for a
                  cash bid  realizing net cash proceeds of less than the Minimum
                  Sales  Price,  the  Trustee  shall  transmit  by  mail  to the
                  Certificateholders  holding  Certificates  in accordance  with
                  Section  313(c) of the  Trust  Indenture  Act,  a copy of such
                  request.  The Trustee shall follow the Direction of a majority
                  in  interest  of the  Fractional  Undivided  Interests  of the
                  Certificates  with respect to such request.  The Trustee shall
                  not take any action with  respect to such  request  unless and
                  until it receives such a Direction.

                        (iii) As promptly as practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee of any report
                  from the Loan Trustee regarding  Consolidated  Adjusted EBITDA
                  pursuant to the Leases or the  Indentures,  the Trustee  shall
                  transmit   by   mail   to   the   Certificateholders   holding
                  Certificates  in accordance  with Section  313(c) of the Trust
                  Indenture Act, a copy of such report.

                        (iv) As promptly as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of a request by the  Company to amend,  supplement  or
                  waive any of the  provisions of the  Maintenance  Contracts or
                  enter into any additional Maintenance Contracts in replacement
                  (whether in partial  replacement or complete  replacement)  of
                  the  Maintenance  Contracts  pursuant  to  the  Leases  or the
                  Indentures,   the  Trustee  shall  transmit  by  mail  to  the
                  Certificateholders  in accordance  with Section  313(c) of the
                  Trust Indenture Act, a copy of such request. The Trustee shall
                  follow  the  Direction  of  a  majority  in  interest  of  the
                  Fractional   Undivided  Interests  of  the  Certificates  with
                  respect to such request.


                                       2


                        (v) As promptly as practical, and in any event within 10
                  days after,  the  receipt by the  Trustee of any  information,
                  report or certificate  obtained by the Consultant  pursuant to
                  the Leases or the  Indentures,  the Trustee shall  transmit by
                  mail to the  Certificateholders  in  accordance  with  Section
                  313(c)  of  the  Trust  Indenture  Act,  a copy  of  any  such
                  information, report or certificate.

                        (vi)  The  Trustee  shall  follow  the  Direction  of  a
                  majority in interest of the Fractional  Undivided Interests of
                  the  Certificates  with  respect  to  the  designation  of any
                  Special Inspector and with respect to any inspection  pursuant
                  to the Leases or the  Indentures.  As  promptly  as  practical
                  after,  and in any event within 10 days after,  the receipt by
                  the Trustee of copies of any  Aircraft  Documents,  results of
                  any  inspection  or  any  other  information  obtained  by the
                  Special  Inspector  pursuant to the Leases or the  Indentures,
                  the Trustee shall  transmit by mail to the  Certificateholders
                  in accordance  with Section 313(c) of the Trust Indenture Act,
                  copies of any such Aircraft  Documents,  results of inspection
                  or other information.

                        (vii) As promptly as practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of a request by the  Company to replace a  Maintenance
                  Contractor  pursuant  to the  Leases  or the  Indentures,  the
                  Trustee shall  transmit by mail to the  Certificateholders  in
                  accordance  with Section 313(c) of the Trust  Indenture Act, a
                  copy of such request and a copy of any  proposed  contract and
                  assignment with respect thereto.  The Trustee shall follow the
                  Direction  of a majority in interest of  Fractional  Undivided
                  Interests of the  Certificates  with respect to such  request,
                  contract and assignment. The Trustee shall not take any action
                  with respect to such request,  contract or  assignment  unless
                  and until it receives such a Direction.

                        (viii)  The  Trustee  shall  follow the  Direction  of a
                  majority in interest of Fractional  Undivided Interests of the
                  Certificates  with respect to any choice and  designation of a
                  Consultant  or a Special  Inspector  pursuant to the Leases or
                  the  Indentures.  The  Trustee  shall not take any action with
                  respect to any such choice or designation  unless and until it
                  receives such a Direction.

3. MISCELLANEOUS.

      (a)   The Trustee  accepts the trusts created by the Trust  Agreement,  as
            supplemented  by this Trust  Supplement,  and agrees to perform  the
            same upon the  terms  and  conditions  of the  Trust  Agreement,  as
            supplemented by this Trust Supplement.

      (b)   Except as  expressly  provided in this Trust  Supplement,  the Trust
            Agreement   shall   remain  in  full  force  and   effect,   without
            modification or amendment.


                                       3


      (c)   This Trust  Supplement shall be binding upon, and shall inure to the
            benefit of, the  parties  hereto and the  successors  and assigns of
            each of the parties hereto.

      (d)   This  Trust  Supplement  shall be  governed  by,  and  construed  in
            accordance with, the laws of the State of New York.

      (e)   This Trust Supplement may be executed in two counterparts and by the
            parties  hereto  on  separate  counterparts,  each of which  when so
            executed  and  delivered  shall  be an  original,  but all of  which
            counterparts  taken  together  shall be deemed to constitute one and
            the same instrument.  A facsimile of an executed  counterpart  shall
            have the same effect as the original executed counterpart.

4. EFFECTIVENESS.

      This Trust  Supplement shall take effect on the Effective Date (as defined
in the Restructure Agreements).

      [Remainder of page intentionally blank. Next page is signature page.]


                                       4


      IN WITNESS  WHEREOF,  the parties hereto have caused this Trust Supplement
to be duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.

                                    ATLAS AIR, INC.


                                    By: /s/ William C. Bradley
                                        ----------------------------------------
                                    Name: William C. Bradley
                                    Title: Vice President & Treasurer


                                    WILMINGTON TRUST COMPANY,
                                    AS TRUSTEE


                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:

                                      1998 CLASS A PASS THROUGH TRUST SUPPLEMENT



      IN WITNESS  WHEREOF,  the parties hereto have caused this Trust Supplement
to be duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.

                                    ATLAS AIR, INC.


                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:


                                    WILMINGTON TRUST COMPANY,
                                    AS TRUSTEE


                                    By: /s/ Anita E. Dallago
                                        ----------------------------------------
                                    Name: Anita E. Dallago
                                    Title: Senior Financial Services Officer

                                      1998 CLASS A PASS THROUGH TRUST SUPPLEMENT

EX-4.1.41

                                                                  EXHIBIT 4.1.41

                                                                  EXECUTION COPY
                                                           1999 EETC TRANSACTION

           AMENDMENT TO 1999 CLASS A-1 PASS THROUGH TRUST SUPPLEMENT

      THIS AMENDMENT TO TRUST  SUPPLEMENT  NO.  1999-1A-1 is made as of the 27th
day of July,  2004 (this  "AMENDMENT"),  by and  between  ATLAS AIR,  INC.  (the
"COMPANY") and WILMINGTON  TRUST COMPANY (the  "TRUSTEE"),  as Trustee under the
Pass Through Trust Agreement dated as of April 1, 1999,  between the Company and
the Trustee with  respect to the  formation  from to time of separate  Atlas Air
Pass Through Trusts (as amended from time to time, the "TRUST AGREEMENT").

                             PRELIMINARY STATEMENT

      The Company and the Trustee are parties to the Trust  Agreement and to the
supplements  thereto,  including Trust  Supplement No. 1999-1A-1 (the "CLASS A-1
SUPPLEMENT"),  pursuant  to which  7.20%  Atlas Air Pass  Through  Certificates,
Series 1999-1A-1,  were issued.  As contemplated by the Restructure  Agreements,
dated as of July 27, 2004, among the Company,  the Trustee and the other parties
named  therein  (collectively,  "RESTRUCTURE  AGREEMENTS"),  the Company and the
Trustee desire to enter into this Amendment.

      NOW,  THEREFORE,  for good and  valuable  consideration,  the  receipt and
sufficiency  of which are  hereby  acknowledged,  the  parties  hereto  agree as
follows:

1. DEFINED TERMS.

      Capitalized  terms used and not  otherwise  defined  herein shall have the
same meanings given to them in the Trust Agreement or Class A-1  Supplement,  as
applicable.

2. AMENDMENTS TO CLASS A-1 SUPPLEMENT.

      The Class A-1 Supplement is amended as follows:

      (a) The  following  Section 3.03 is added after  Section 3.02 of the Class
      A-1 Supplement:

            "Section 3.03 ADDITIONAL PROVISIONS REGARDING LEASES AND INDENTURES.

                  (a) The Trustee and the Company acknowledge and agree that (i)
            each of the Leases has been amended by a certain  amendment dated as
            of July 27, 2004  between the Owner  Trustee  named  therein and the
            Company (collectively, the "Lease Amendments"), and (ii) each of the
            Indentures has been amended by a certain supplement dated as of July
            27, 2004  between the Company or the Owner  Trustee (as  applicable)
            named therein and the Mortgagee  named  therein  (collectively,  the
            "Indenture Supplements").  As of the Restructure Agreement Execution
            Date, (x) all references  herein and, with respect to the Applicable
            Trust



            created hereby,  in the Basic Agreement to the Leases shall mean and
            refer to the  Leases  as  amended  by the  Lease  Amendments  and as
            further  amended from time to time, (y) all  references  herein and,
            with respect to the Applicable  Trust created  hereby,  in the Basic
            Agreement to the  Indentures  shall mean and refer to the Indentures
            as amended by the Indenture  Supplements and as further amended from
            time to time,  and (z) all  capitalized  terms used herein and, with
            respect  to the  Applicable  Trust  created  hereby,  in  the  Basic
            Agreement  without  definition  shall have the  respective  meanings
            specified in the Leases, as amended by the Lease Amendments,  and in
            the Indentures, as amended by the Indenture Supplements.

                  (b) The Trustee and the Company  agree that in addition to the
            duties and  responsibilities  of the  Trustee  hereunder  and,  with
            respect to the  Applicable  Trust  created  hereby,  under the Basic
            Agreement,  the  Trustee  shall also,  on and after the  Restructure
            Agreement   Execution   Date,   have  the   following   duties   and
            responsibilities:

                        (i) As promptly  as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of any notice regarding any  Enhancements  pursuant to
                  the Leases or the  Indentures,  the Trustee shall  transmit by
                  mail  to  the   Certificateholders   holding  Certificates  in
                  accordance  with Section 313(c) of the Trust  Indenture Act, a
                  copy of such notice.

                        (ii) As promptly as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee  of a  request  by the  Company  to sell an  Owned  or
                  Controlled Aircraft as required pursuant to the Leases and the
                  Indentures  upon the  occurrence of a Sale Trigger Event for a
                  cash bid  realizing net cash proceeds of less than the Minimum
                  Sales  Price,  the  Trustee  shall  transmit  by  mail  to the
                  Applicable  Certificateholders holding Applicable Certificates
                  in accordance  with Section 313(c) of the Trust Indenture Act,
                  a copy of such request. The Trustee shall follow the Direction
                  of  a  majority  in  interest  of  the  Fractional   Undivided
                  Interests of the Applicable  Certificates with respect to such
                  request. The Trustee shall not take any action with respect to
                  such request unless and until it receives such a Direction.

                        (iii) As promptly as practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee of any report
                  from the Loan Trustee regarding  Consolidated  Adjusted EBITDA
                  pursuant to the Leases or the  Indentures,  the Trustee  shall
                  transmit by mail to the Applicable  Certificateholders holding
                  Applicable  Certificates  in accordance with Section 313(c) of
                  the Trust Indenture Act, a copy of such report.

                        (iv) As promptly as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of a request by the  Company to amend,  supplement  or
                  waive any of the provisions of the


                                       2


                  Maintenance Contracts or enter into any additional Maintenance
                  Contracts in  replacement  (whether in partial  replacement or
                  complete replacement) of the Maintenance Contracts pursuant to
                  the Leases or the  Indentures,  the Trustee shall  transmit by
                  mail to the Applicable  Certificateholders  in accordance with
                  Section  313(c) of the  Trust  Indenture  Act,  a copy of such
                  request.  The Trustee shall follow the Direction of a majority
                  in  interest  of the  Fractional  Undivided  Interests  of the
                  Applicable Certificates with respect to such request.

                        (v) As promptly as practical, and in any event within 10
                  days after,  the  receipt by the  Trustee of any  information,
                  report or certificate  obtained by the Consultant  pursuant to
                  the Leases or the  Indentures,  the Trustee shall  transmit by
                  mail to the Applicable  Certificateholders  in accordance with
                  Section 313(c) of the Trust  Indenture Act, a copy of any such
                  information, report or certificate.

                        (vi)  The  Trustee  shall  follow  the  Direction  of  a
                  majority in interest of the Fractional  Undivided Interests of
                  the Applicable Certificates with respect to the designation of
                  any  Special  Inspector  and with  respect  to any  inspection
                  pursuant  to the  Leases or the  Indentures.  As  promptly  as
                  practical  after,  and in any event within 10 days after,  the
                  receipt by the  Trustee of copies of any  Aircraft  Documents,
                  results of any inspection or any other information obtained by
                  the   Special   Inspector   pursuant  to  the  Leases  or  the
                  Indentures,   the  Trustee  shall  transmit  by  mail  to  the
                  Applicable   Certificateholders  in  accordance  with  Section
                  313(c) of the Trust Indenture Act, copies of any such Aircraft
                  Documents, results of inspection or other information.

                        (vii) As promptly as practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of a request by the  Company to replace a  Maintenance
                  Contractor  pursuant  to the  Leases  or the  Indentures,  the
                  Trustee   shall   transmit   by   mail   to   the   Applicable
                  Certificateholders  in accordance  with Section  313(c) of the
                  Trust  Indenture Act, a copy of such request and a copy of any
                  proposed  contract and assignment  with respect  thereto.  The
                  Trustee  shall follow the  Direction of a majority in interest
                  of   Fractional   Undivided   Interests   of  the   Applicable
                  Certificates  with  respect  to  such  request,  contract  and
                  assignment. The Trustee shall not take any action with respect
                  to such request,  contract or  assignment  unless and until it
                  receives such a Direction.

                        (viii)  The  Trustee  shall  follow the  Direction  of a
                  majority in interest of Fractional  Undivided Interests of the
                  Applicable   Certificates  with  respect  to  any  choice  and
                  designation of a Consultant or a Special Inspector pursuant to
                  the Leases or the  Indentures.  The Trustee shall not take any
                  action with respect to any such choice or  designation  unless
                  and until it receives such a Direction.


                                       3


3. MISCELLANEOUS.

      (a)   The Trustee  accepts the trusts created by the Trust  Agreement,  as
            supplemented  by  the  Class  A-1  Supplement  as  amended  by  this
            Amendment,  and  agrees  to  perform  the same  upon the  terms  and
            conditions of the Trust Agreement,  as supplemented by the Class A-1
            Supplement as amended by this Amendment.

      (b)   Except to the  extent  that the Class A-1  Supplement  is  expressly
            amended  by this  Amendment,  the  Trust  Agreement  and  Class  A-1
            Supplement   shall   remain  in  full  force  and  effect,   without
            modification or amendment.

      (c)   This Amendment shall be binding upon, and shall inure to the benefit
            of, the parties hereto and the successors and assigns of each of the
            parties hereto.

      (d)   This  Amendment  shall be governed by, and  construed in  accordance
            with, the laws of the State of New York.

      (e)   This  Amendment  may  be  executed  in two  counterparts  and by the
            parties  hereto  on  separate  counterparts,  each of which  when so
            executed  and  delivered  shall  be an  original,  but all of  which
            counterparts  taken  together  shall be deemed to constitute one and
            the same instrument.  A facsimile of an executed  counterpart  shall
            have the same effect as the original executed counterpart.

4. EFFECTIVENESS.

      This Amendment  shall take effect on the Effective Date (as defined in the
Restructure Agreements).

     [Remainder of page intentionally blank. Next page is signature page.]


                                       4


      IN WITNESS  WHEREOF,  the parties hereto have caused this Trust Supplement
to be duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.

                                    ATLAS AIR, INC.


                                    By: /s/ William C. Bradley
                                        ----------------------------------------
                                    Name: William C. Bradley
                                    Title: Vice President & Treasurer

                                    WILMINGTON TRUST COMPANY,
                                    AS TRUSTEE


                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:

                       AMENDMENT TO 1999 CLASS A-1 PASS THROUGH TRUST SUPPLEMENT



      IN WITNESS  WHEREOF,  the parties hereto have caused this Trust Supplement
to be duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.

                                    ATLAS AIR, INC.


                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:


                                    WILMINGTON TRUST COMPANY,
                                    AS TRUSTEE


                                    By: /s/ Anita E. Dallago
                                        ----------------------------------------
                                    Name: Anita E. Dallago
                                    Title: Senior Financial Services Officer

                       AMENDMENT TO 1999 CLASS A-1 PASS THROUGH TRUST SUPPLEMENT

EX-4.1.42

                                                                  EXHIBIT 4.1.42


                                                                  EXECUTION COPY
                                                           2000 EETC TRANSACTION

             AMENDMENT TO 2000 CLASS A PASS THROUGH TRUST SUPPLEMENT

      THIS AMENDMENT TO TRUST SUPPLEMENT NO. 2000-1-A is made as of the 27th day
of July, 2004 (this "AMENDMENT"), by and between ATLAS AIR, INC. (the "COMPANY")
and WILMINGTON TRUST COMPANY (the "TRUSTEE"),  as Trustee under the Pass Through
Trust  Agreement  dated as of January  28,  2000,  between  the  Company and the
Trustee with respect to the  formation  from to time of separate  Atlas Air Pass
Through Trusts (as amended from time to time, the "TRUST AGREEMENT").

                             PRELIMINARY STATEMENT

      The Company and the Trustee are parties to the Trust  Agreement and to the
supplements  thereto,  including  Trust  Supplement  No.  2000-1-A (the "CLASS A
SUPPLEMENT"),  pursuant to which  8.707%  Atlas Air Pass  Through  Certificates,
Series 2000-1A,  were issued.  As  contemplated  by the Restructure  Agreements,
dated as of July 27, 2004, among the Company,  the Trustee and the other parties
named therein (collectively,  the "RESTRUCTURE AGREEMENTS"), the Company and the
Trustee desire to enter into this Amendment.

      NOW,  THEREFORE,  for good and  valuable  consideration,  the  receipt and
sufficiency  of which are  hereby  acknowledged,  the  parties  hereto  agree as
follows:

1. DEFINED TERMS.

      Capitalized  terms used and not  otherwise  defined  herein shall have the
same meanings  given to them in the Trust  Agreement or Class A  Supplement,  as
applicable.

2. AMENDMENTS TO CLASS A SUPPLEMENT.

      The Class A Supplement is amended as follows:

      (a) The following  Section 3.03 is added after Section 3.02 of the Class A
      Supplement:

            "Section 3.03 ADDITIONAL PROVISIONS REGARDING LEASES AND INDENTURES.

                  (a) The Trustee and the Company acknowledge and agree that (i)
            each of the Leases other than the Lease with respect to the Aircraft
            bearing U.S.  registration  mark N409MC  ("AIRCRAFT  N409") has been
            amended by a certain amendment dated as of July 27, 2004 between the
            Owner  Trustee  named  therein  and the Company  (collectively,  the
            "Lease  Amendments"),  (ii) each of the  Indentures  other  than the
            Indenture  with  respect  to  Aircraft  N409 has been  amended  by a
            certain  supplement  dated as of July 27,  2004  between  the  Owner
            Trustee named therein and the Mortgagee named therein (collectively,
            the



            "Indenture  Supplements"),  and (iii) the Lease and  Indenture  with
            respect  to  Aircraft  N409  may  hereafter  be  amended  (any  such
            amendment  being  an  "N409  AMENDMENT").   As  of  the  Restructure
            Agreement  Execution  Date,  (x) all  references  herein  and,  with
            respect  to the  Applicable  Trust  created  hereby,  in  the  Basic
            Agreement  to the  Leases  shall  mean and  refer to the  Leases  as
            amended by the Lease  Amendments and as further amended from time to
            time  (including  without  limitation any N409  Amendment),  (y) all
            references  herein and, with respect to the Applicable Trust created
            hereby,  in the Basic  Agreement  to the  Indentures  shall mean and
            refer to the Indentures as amended by the Indenture  Supplements and
            as further amended from time to time (including  without  limitation
            any N409 Amendment),  and (z) all capitalized terms used herein and,
            with respect to the Applicable  Trust created  hereby,  in the Basic
            Agreement  without  definition  shall have the  respective  meanings
            specified in the Leases, as amended by the Lease Amendments,  and in
            the Indentures,  as amended by the Indenture Supplements,  and, with
            respect to Aircraft  N409, as amended by the N409  Amendments if and
            when such N409 Amendments are executed and take effect.

                  (b) The Trustee and the Company  agree that in addition to the
            duties and  responsibilities  of the  Trustee  hereunder  and,  with
            respect to the  Applicable  Trust  created  hereby,  under the Basic
            Agreement,  the  Trustee  shall also,  on and after the  Restructure
            Agreement   Execution   Date,   have  the   following   duties   and
            responsibilities:

                        (i) As promptly  as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of any notice regarding any  Enhancements  pursuant to
                  the Leases or the  Indentures,  the Trustee shall  transmit by
                  mail  to  the   Certificateholders   holding  Certificates  in
                  accordance  with Section 313(c) of the Trust  Indenture Act, a
                  copy of such notice.

                        (ii) As promptly as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee  of a  request  by the  Company  to sell an  Owned  or
                  Controlled Aircraft as required pursuant to the Leases and the
                  Indentures  upon the  occurrence of a Sale Trigger Event for a
                  cash bid  realizing net cash proceeds of less than the Minimum
                  Sales  Price,  the  Trustee  shall  transmit  by  mail  to the
                  Applicable  Certificateholders holding Applicable Certificates
                  in accordance  with Section 313(c) of the Trust Indenture Act,
                  a copy of such request. The Trustee shall follow the Direction
                  of  a  majority  in  interest  of  the  Fractional   Undivided
                  Interests of the Applicable  Certificates with respect to such
                  request. The Trustee shall not take any action with respect to
                  such request unless and until it receives such a Direction.

                        (iii) As promptly as practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee of any report
                  from the Loan Trustee regarding  Consolidated  Adjusted EBITDA
                  pursuant to the Leases or the


                                       2


                  Indentures,   the  Trustee  shall  transmit  by  mail  to  the
                  Applicable  Certificateholders holding Applicable Certificates
                  in accordance  with Section 313(c) of the Trust Indenture Act,
                  a copy of such report.

                        (iv) As promptly as  practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of a request by the  Company to amend,  supplement  or
                  waive any of the  provisions of the  Maintenance  Contracts or
                  enter into any additional Maintenance Contracts in replacement
                  (whether in partial  replacement or complete  replacement)  of
                  the  Maintenance  Contracts  pursuant  to  the  Leases  or the
                  Indentures,   the  Trustee  shall  transmit  by  mail  to  the
                  Applicable   Certificateholders  in  accordance  with  Section
                  313(c) of the Trust Indenture Act, a copy of such request. The
                  Trustee  shall follow the  Direction of a majority in interest
                  of  the  Fractional  Undivided  Interests  of  the  Applicable
                  Certificates with respect to such request.

                        (v) As promptly as practical, and in any event within 10
                  days after,  the  receipt by the  Trustee of any  information,
                  report or certificate  obtained by the Consultant  pursuant to
                  the Leases or the  Indentures,  the Trustee shall  transmit by
                  mail to the Applicable  Certificateholders  in accordance with
                  Section 313(c) of the Trust  Indenture Act, a copy of any such
                  information, report or certificate.

                        (vi)  The  Trustee  shall  follow  the  Direction  of  a
                  majority in interest of the Fractional  Undivided Interests of
                  the Applicable Certificates with respect to the designation of
                  any  Special  Inspector  and with  respect  to any  inspection
                  pursuant  to the  Leases or the  Indentures.  As  promptly  as
                  practical  after,  and in any event within 10 days after,  the
                  receipt by the  Trustee of copies of any  Aircraft  Documents,
                  results of any inspection or any other information obtained by
                  the   Special   Inspector   pursuant  to  the  Leases  or  the
                  Indentures,   the  Trustee  shall  transmit  by  mail  to  the
                  Applicable   Certificateholders  in  accordance  with  Section
                  313(c) of the Trust Indenture Act, copies of any such Aircraft
                  Documents, results of inspection or other information.

                        (vii) As promptly as practical  after,  and in any event
                  within 10 days after, the receipt by the Trustee from the Loan
                  Trustee of a request by the  Company to replace a  Maintenance
                  Contractor  pursuant  to the  Leases  or the  Indentures,  the
                  Trustee   shall   transmit   by   mail   to   the   Applicable
                  Certificateholders  in accordance  with Section  313(c) of the
                  Trust  Indenture Act, a copy of such request and a copy of any
                  proposed  contract and assignment  with respect  thereto.  The
                  Trustee  shall follow the  Direction of a majority in interest
                  of   Fractional   Undivided   Interests   of  the   Applicable
                  Certificates  with  respect  to  such  request,  contract  and
                  assignment. The Trustee shall not take any action with respect
                  to such request,  contract or  assignment  unless and until it
                  receives such a Direction.


                                       3


                        (viii)  The  Trustee  shall  follow the  Direction  of a
                  majority in interest of Fractional  Undivided Interests of the
                  Applicable   Certificates  with  respect  to  any  choice  and
                  designation of a Consultant or a Special Inspector pursuant to
                  the Leases or the  Indentures.  The Trustee shall not take any
                  action with respect to any such choice or  designation  unless
                  and until it receives such a Direction.

3. MISCELLANEOUS.

      (a)   The Trustee  accepts the trusts created by the Trust  Agreement,  as
            supplemented by the Class A Supplement as amended by this Amendment,
            and agrees to perform the same upon the terms and  conditions of the
            Trust  Agreement,  as  supplemented  by the  Class A  Supplement  as
            amended by this Amendment.

      (b)   Except  to the  extent  that the  Class A  Supplement  is  expressly
            amended  by  this  Amendment,   the  Trust  Agreement  and  Class  A
            Supplement   shall   remain  in  full  force  and  effect,   without
            modification or amendment.

      (c)   This Amendment shall be binding upon, and shall inure to the benefit
            of, the parties hereto and the successors and assigns of each of the
            parties hereto.

      (d)   This  Amendment  shall be governed by, and  construed in  accordance
            with, the laws of the State of New York.

      (e)   This  Amendment  may  be  executed  in two  counterparts  and by the
            parties  hereto  on  separate  counterparts,  each of which  when so
            executed  and  delivered  shall  be an  original,  but all of  which
            counterparts  taken  together  shall be deemed to constitute one and
            the same instrument.  A facsimile of an executed  counterpart  shall
            have the same effect as the original executed counterpart.

4. EFFECTIVENESS.

      This Amendment  shall take effect on the Effective Date (as defined in the
Restructure Agreement).

      [Remainder of page intentionally blank. Next page is signature page.]


                                       4


      IN WITNESS  WHEREOF,  the parties hereto have caused this Trust Supplement
to be duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.

                                    ATLAS AIR, INC.


                                    By: /s/ William C. Bradley
                                        ----------------------------------------
                                    Name: William C. Bradley
                                    Title: Vice President & Treasurer


                                    WILMINGTON TRUST COMPANY,
                                    AS TRUSTEE


                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:

                         AMENDMENT TO 2000 CLASS A PASS THROUGH TRUST SUPPLEMENT



      IN WITNESS  WHEREOF,  the parties hereto have caused this Trust Supplement
to be duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.

                                    ATLAS AIR, INC.


                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:


                                    WILMINGTON TRUST COMPANY,
                                    AS TRUSTEE


                                    By: /s/ Anita E. Dallago
                                        ----------------------------------------
                                    Name: Anita E. Dallago
                                    Title: Senior Financial Services Officer

                         AMENDMENT TO 2000 CLASS A PASS THROUGH TRUST SUPPLEMENT

EX-10.1.1

                                                                  EXHIBIT 10.1.1


                      ASSIGNMENT AND ASSUMPTION AGREEMENT

            ASSIGNMENT AND ASSUMPTION AGREEMENT (this "AGREEMENT") dated as of
August 19, 2004, between FINOVA CAPITAL CORPORATION, a Delaware corporation
("ASSIGNOR") and Atlas Air, Inc., a Delaware corporation ("ASSIGNEE").

                                  WITNESSETH:

            WHEREAS, the parties hereto desire to effect (a) the transfer by
Assignor to Assignee of all of the right, title and interest of Assignor, in,
under and with respect to, among other things, (i) the Participation Agreement
dated as of July 29, 1998 among Atlas Air, Inc., as Lessee, FINOVA Capital
Corporation, as Owner Participant, Wells Fargo Bank Northwest, National
Association (as successor to First Security Bank, National Association), not in
its individual capacity, except as expressly provided therein, but solely as
Owner Trustee, and Wilmington Trust Company, not in its individual capacity,
except as expressly provided therein, but solely as Mortgagee, Subordination
Agent and Pass Through Trustee, as amended, modified or supplemented and in
effect from time to time (the "PARTICIPATION AGREEMENT") relating to one Boeing
model 747-47UF aircraft bearing manufacturer's serial number 29252 and U.K.
registration mark G-GSSB (formerly bearing U.S. registration mark N491MC),
including, without limitation, any indemnity payments payable by the Lessee
directly or indirectly thereunder, (ii) the Trust Agreement* identified in the
Participation Agreement, (iii) the Trust Estate (as defined in the Trust
Agreement), (iv) the proceeds therefrom; and

            WHEREAS, such documents permit such transfer upon satisfaction of
certain conditions heretofore or concurrently herewith being complied with;

            NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:

            1. DEFINITIONS. Capitalized terms used herein without definition
shall have the respective meanings ascribed thereto in the Participation
Agreement.

            2. ASSIGNMENT. Assignor has sold, conveyed, assigned, transferred
and set over, and does hereby sell, convey, assign, transfer and set over, unto
Assignee, as of the date hereof, all of its present and future right, title and
interest in, under and with respect to the Participation Agreement, the Trust
Agreement, the Trust Estate and all of the other Operative Agreements to which
Assignor is a party, and any proceeds therefrom, together with all other
documents and instruments evidencing any of such right, title and interest,
except (i) such rights of Assignor as have arisen or accrued to Assignor prior
to the date hereof (including specifically, but without limitation, the right to
receive any amounts due or accrued to Assignor under the Operative Agreements as
of a time prior to such date and the right to receive any indemnity payment
pursuant to the Participation Agreement with respect to events occurring or
liabilities accruing on or prior to such date) (the "RETAINED ASSETS") and (ii)
for the Tax Indemnity Agreement.

            3. TERMINATION OF TAX INDEMNITY AGREEMENT AND RELEASE OF TAX CLAIMS.
The Assignor and Assignee hereby agree that the Tax Indemnity Agreement shall be
and is


* dated as July 29,1998, as amended by Amendment to Trust Agreement dated as of
  July 23, 2003



terminated as of the date of this Agreement and Assignee shall have no further
liability to Assignor thereunder. In addition, Assignor hereby expressly
releases Assignee from, and now and forever waives any claim for, any liability
in respect of taxes and any loss of any tax benefit (including, but not limited
to, any claim pursuant to the Tax Indemnity Agreement) (i) existing or arising
on, or prior to, the date hereof or (ii) based on any acts, omissions, or events
occurring on, or prior to, the date hereof, except for any liability in respect
of sales or transfer taxes arising from or in connection with the assignment
described in paragraph 2 hereof. In addition, Assignee hereby expressly releases
Assignor from, and now and forever waives any claim for, any liability in
respect of taxes and any realization of any tax benefit (including, but not
limited to, any claim pursuant to the Tax Indemnity Agreement) (i) existing or
arising on, or prior to, the date hereof or (ii) based on any acts, omissions,
or events occurring on, or prior to, the date hereof.

            4. ASSUMPTION. Assignee hereby accepts the assignment set forth in
paragraph 2 hereof and assumes and undertakes all of the duties and obligations
of Assignor accruing from and after the date hereof (excluding any duties and
obligations of Assignor required to be performed by it on or prior to the date
hereof under the Operative Agreements to which the Owner Participant is a party
and any of the other Operative Agreements by which Assignor is bound or any
other contract, agreement, document or other instrument relating to the Trust
Estate to which the Owner Participant is a party or by which it is bound and any
liabilities of the Assignor arising from such duties and obligations) pursuant
to the Trust Agreement, the Participation Agreement and each other Operative
Agreement to which Assignor is a party or by which Assignor is bound, including,
without limitation, any obligations it may have under any Operative Agreement
with regard to the Lessee, the Mortgagee or the Owner Trustee, excluding,
however, the Tax Indemnity Agreement. Assignee hereby confirms that from and
after the date hereof it (i) shall be deemed a party to the Participation
Agreement, the Trust Agreement and each other Operative Agreement to which the
Owner Participant is a party other than the Tax Indemnity Agreement, (ii) shall
be deemed the party named as the "Owner Participant" in the Trust Agreement, the
Participation Agreement, the Lease and the Trust Indenture and (iii) except as
expressly provided in this paragraph 4, shall be bound by all of the terms of
each Operative Agreement to which Assignor is a party or by which it is bound,
other than the Tax Indemnity Agreement (including the agreements and obligations
of the Assignor set forth therein) as if therein named the Owner Participant.

            5. RELEASE OF ASSIGNOR. Except for liabilities not expressly assumed
by Assignee under Section 4 hereof, upon the date hereof, Assignor is released
from all of its duties, obligations and liabilities under the Participation
Agreement and the Trust Agreement and each other Operative Agreement to which
Assignor is a party or by which Assignor is bound; PROVIDED, HOWEVER, that
Assignor shall in no event be released from any such liability arising on
account of any breach on or prior to the date hereof by Assignor of any of its
representations, warranties, covenants or obligations set forth in the
Participation Agreement or the Trust Agreement, or for any misconduct engaged in
by it prior to the date hereof, or from any obligation that relates to any
indemnity claimed by Assignor or any Lessor Lien arising from or attributable to
Assignor.


                                      -2-


            6. PAYMENTS. Assignor hereby covenants and agrees to pay over to
Assignee, if and when received following the date hereof, any amounts (including
any sums payable as interest in respect thereof) paid to or for the benefit of
Assignor that, under Section 2 hereof, belong to Assignee, and Assignee hereby
covenants and agrees to pay over to Assignor, if and when received following the
date hereof, any amounts (including any sums payable as interest in respect
thereof) paid to or for the benefit of Assignee that, under Section 2 hereof,
belong to Assignor.

            7. REPRESENTATIONS AND WARRANTIES OF ASSIGNOR. Assignor represents
and warrants that:

            (a) it is a Delaware corporation, duly organized and validly
      existing in good standing under the Laws of the State of Delaware and has
      the requisite power, authority and legal right to enter into and carry out
      the transactions contemplated hereby;

            (b) this Agreement has been duly authorized, executed and delivered
      by it and constitutes the legal, valid and binding obligation of Assignor,
      enforceable against it in accordance with its terms;

            (c) no action or proceeding is pending, has been instituted or, to
      the knowledge of Assignor, is threatened, before any court or governmental
      agency, nor has any order, judgment or decree been issued or, to the
      knowledge of Assignor, is threatened, by any court or governmental agency
      which would materially adversely affect the ability of Assignor to
      complete and consummate its obligations contemplated hereby;

            (d) the Trust Estate is free of Lessor Liens attributable to it;

            (e) it has fully performed all of its obligations under the
      Participation Agreement and under each other Operative Agreement to which
      it is a party or by which it is bound, which obligations by their terms
      are required to be satisfied or performed prior to the date hereof;

            (f) neither the execution, delivery and performance by it of this
      Agreement, nor compliance by it with any of the provisions thereof
      requires or will require any approval of its stockholders, or approval or
      consent of any trustees or holders of any indebtedness or obligations of
      it or contravenes or will contravene any Law or any order of any court or
      governmental authority or agency applicable to or binding on it or
      contravenes or will contravene the provisions of, or constitute a default
      under, its Certificate of Incorporation or Bylaws or any indenture,
      mortgage, contract or any agreement or instrument to which it is a party
      or by which it or any of its property may be bound or affected;

            (g) no authorization or approval or other action by, and no notice
      to or filing with, any governmental authority or regulatory body (other
      than as required by the Act, or the regulations promulgated thereunder) is
      required for the due execution, delivery or performance by it of this
      Agreement;


                                      -3-


            (h) the transfer to Assignee of all of the Assignor's right, title
      and interest in each Operative Agreement to which it is a party or by
      which it is bound, will not violate any provision of the Act, the
      Securities Act (and no registration pursuant to such Securities Act or the
      rules and regulations thereunder shall be required in connection with such
      transfer), or any other applicable law. Notwithstanding the foregoing, no
      representation is being made in this Section 7 with respect to the absence
      of violations of ERISA;

            (i) no Person action on behalf of Assignor is or will be entitled to
      any broker's fee, commission or finder's fee in connection with the
      transactions contemplated by this Agreement; and

            (j) other than the Purchase Agreement, dated as of July 27, 2004,
      between Assignor and Assignee and the Retained Assets, there are no other
      contracts, agreements, documents or instruments related to the Trust
      Estate by which Assignor is bound.

            8. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents
and warrants that:

            (a) Assignee is a corporation duly incorporated, validly existing
      and in good standing under the Laws of the State of Delaware and has the
      corporate power and authority to conduct the business in which it is
      currently engaged and to own or hold under lease its properties and to
      enter into, and perform its obligations under the agreements assigned to
      and assumed by Assignee under this Agreement. Assignee's parent, Atlas
      Worldwide Holdings, Inc., a Delaware corporation ("GUARANTOR"), will
      provide a guaranty ("GUARANTY") of the obligations of the Assignee in
      accordance with Section 10.1.1(a)(vi) of the Participation Agreement and
      has tangible Net Worth of at least $75,000,000;

            (b) Assignee has taken, or caused to be taken, all necessary
      corporate action (including, without limitation, the obtaining of any
      consent or approval of stockholders required by its Certificate of
      Incorporation or Bylaws) to authorize the execution and delivery of this
      Agreement and the performance of its obligations hereunder and the
      agreements assigned to and assumed by Assignee under this Agreement;

            (c) the execution and delivery by Assignee of this Agreement, the
      performance by Assignee of its obligations hereunder, and under the
      agreements assigned to and assumed by Assignee under this Agreement, and
      the consummation by Assignee on the date of this Agreement of the
      transactions contemplated hereby and thereby, do not and will not (i)
      violate any provision of its Certificate of Incorporation or Bylaws, (ii)
      violate any Law applicable to or binding on the Assignee (it being
      understood that this representation is not made with respect to any Law to
      the extent that such Law relates to ERISA or any Plan) or (iii) violate or
      constitute any default under (other than any violation or default that
      would not result in a Material Adverse Change to Assignee), or result in
      the creation of any


                                      -4-


      Lien (other than as provided for or otherwise permitted in the Operative
      Agreements) upon the Trust Estate, under any indenture, mortgage, chattel
      mortgage, deed of trust, conditional sales contract, lease, loan or other
      material agreement, instrument or document to which Assignee is a party or
      by which Assignee or any of its properties is bound or may be affected in
      any material respect;

            (d) the execution and delivery by Assignee of this Agreement, the
      performance by Assignee of its obligations hereunder, and under the
      agreements assigned to and assumed by Assignee under this Agreement, and
      the consummation by Assignee on the date of this Agreement of the
      transactions contemplated hereby and thereby do not and will not require
      the consent or approval of, or the giving of notice to, or the
      registration with, or the recording or filing of any documents with, or
      the taking of any other action in respect of (i) any trustee or other
      holder of any Debt of Assignee and (ii) any Government Entity other than
      the filing of (A) this Agreement and (B) Amendment No. 2 to Trust
      Agreement dated as of August 19, 2004 between the Owner Trustee and the
      Assignee (the "TRUST AMENDMENT");

            (e) this Agreement has been duly authorized, executed and delivered
      by Assignee, and this Agreement and the agreements assigned to and assumed
      by Assignee under this Agreement (assuming the due authorization,
      execution and delivery by each party to such documents other than
      Assignee) constitute the legal, valid and binding obligations of Assignee
      and are enforceable against Assignee in accordance with the respective
      terms thereof, except as such enforceability may be limited by bankruptcy,
      insolvency, reorganization, receivership, moratorium and other similar
      Laws affecting the rights of creditors generally and general principles of
      equity, whether considered in a proceeding at law or in equity;

            (f) no part of the funds to be used by Assignee or Guarantor to
      acquire or hold its interests in the Trust Estate to be acquired by it
      under this Agreement directly or indirectly constitutes assets of a Plan;

            (g) there are no pending or, to the Actual Knowledge of Assignee,
      threatened actions or proceedings against Assignee or Guarantor before any
      court, governmental body, arbitration board, administrative agency or
      tribunal which, if determined adversely to Assignee or Guarantor, would
      materially adversely affect the ability of Assignee to perform its
      obligations under this Agreement or any of the agreements assigned to and
      assumed by Assignee under this Agreement or the Guarantor to perform its
      obligations under the Guaranty, except as has been and disclosed by
      Assignee in its public filings with the Securities and Exchange Commission
      and in the disclosure statement, as amended, filed in connection with the
      plan of reorganization with the United States Bankruptcy Court for the
      Southern District of Florida;

            (h) neither Assignee nor any person Assignee has authorized to act
      on its behalf has directly or indirectly offered any beneficial interest
      in or Security relating to the ownership of the Aircraft or any interest
      in the Trust Estate, or any of the Equipment Notes or any other interest
      in or Security under the Trust Indenture for sale to,


                                      -5-


      or solicited any offer to acquire any of the same from, any Person in
      violation of the Securities Act or applicable state securities Laws;

            (i) no Person acting on behalf of Assignee or Guarantor is or will
      be entitled to any broker's fee, commission or finder's fee in connection
      with the transactions contemplated by this Agreement;

            (j) other than as provided in Section 8.4.3 of Amendment No. 1 to
      Lease Agreement (the "LEASE AMENDMENT") dated as of July 27, 2004, by and
      between Assignee and Lessor, Assignee's beneficial interest in the Trust
      Estate is being acquired for it by its own account, for investment and not
      with a view to any resale or distribution thereof, except that, subject to
      the restrictions on transfer set forth in Section 10 of the Participation
      Agreement and the transfer requirements contained in Section 8.4.3 of the
      Lease Amendment, the disposition by Assignee of its beneficial interest in
      the Trust Estate shall at all times be within its control;

            (k) Assignee satisfies the "Transferee" requirements set forth in
      Section 10.1.1(a)(vi) of the Participation Agreement by virtue of the
      Trust Amendment;

            (l) the Trust Estate is free of Lessor Liens attributable to it; and

            (m) after giving effect to this assignment, there will be no more
      than one Owner Participant with respect to the Transaction;

            9. GOVERNING LAW. THIS ASSIGNMENT AND ASSUMPTION AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
INCLUDING ALL MATTERS OF CONTRUCTION, VALIDITY AND PERFORMANCE.

            10. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which together shall constitute a single instrument. It
shall not be necessary that any counterpart be signed by both parties so long as
each party shall sign at least one counterpart.

            11. BENEFICIARIES. Each of the Owner Trustee, the Lessee, the Note
Holders and the Mortgagee, together with their respective successors and
permitted assigns, is and shall be deemed a third party beneficiary of this
Agreement entitled to enforce this Agreement directly and in its own name and
enforce any rights or claims of the parties hereto.

            12. FURTHER ASSURANCES. Each party agrees that from time to time
after the date hereof, it shall execute and deliver or cause to be executed and
delivered such instruments, documents and papers, and take all such further
action as may be reasonably required in order to consummate fully the purposes
of this Agreement and to implement the transactions contemplated hereby.

               [Remainder of this page intentionally left blank.]


                                      -6-


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

                                         FINOVA CAPITAL CORPORATION

                                         By: /s/ Maryann V. Richandson
                                             -----------------------------------
                                             Name:  Maryann V. Richandson
                                             Title: Vice President


                                         ATLAS AIR, INC.

                                         By: /s/ William C. Bradley
                                             -----------------------------------
                                             Name:  William C. Bradley
                                             Title: Vice President & Treasurer


                                      -7-

EX-10.1.2

                                                                  EXHIBIT 10.1.2


                      ASSIGNMENT AND ASSUMPTION AGREEMENT

            ASSIGNMENT AND ASSUMPTION AGREEMENT (this "AGREEMENT") dated as of
August 16, 2004, between FINOVA CAPITAL CORPORATION, a Delaware corporation
("ASSIGNOR") and Atlas Air, Inc., a Delaware corporation ("ASSIGNEE").

                                  WITNESSETH:

            WHEREAS, the parties hereto desire to effect (a) the transfer by
Assignor to Assignee of all of the right, title and interest of Assignor, in,
under and with respect to, among other things, (i) the Participation Agreement
dated as of October 19, 1998 among Atlas Air, Inc., as Lessee, FINOVA Capital
Corporation, as Owner Participant, Wells Fargo Bank Northwest, National
Association (as successor to First Security Bank, National Association), not in
its individual capacity, except as expressly provided therein, but solely as
Owner Trustee, and Wilmington Trust Company, not in its individual capacity,
except as expressly provided therein, but solely as Mortgagee, Subordination
Agent and Pass Through Trustee, as amended, modified or supplemented and in
effect from time to time (the "PARTICIPATION AGREEMENT") relating to one Boeing
model 747-47UF aircraft bearing manufacturer's serial number 29254 and U.S..
registration mark N493MC, including, without limitation, any indemnity payments
payable by the Lessee directly or indirectly thereunder, (ii) the Trust
Agreement identified in the Participation Agreement, (iii) the Trust Estate (as
defined in the Trust Agreement), (iv) the proceeds therefrom; and

            WHEREAS, such documents permit such transfer upon satisfaction of
certain conditions heretofore or concurrently herewith being complied with;

            NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:

            1. DEFINITIONS. Capitalized terms used herein without definition
shall have the respective meanings ascribed thereto in the Participation
Agreement.

            2. ASSIGNMENT. Assignor has sold, conveyed, assigned, transferred
and set over, and does hereby sell, convey, assign, transfer and set over, unto
Assignee, as of the date hereof, all of its present and future right, title and
interest in, under and with respect to the Participation Agreement, the Trust
Agreement, the Trust Estate and all of the other Operative Agreements to which
Assignor is a party, and any proceeds therefrom, together with all other
documents and instruments evidencing any of such right, title and interest,
except (i) such rights of Assignor as have arisen or accrued to Assignor prior
to the date hereof (including specifically, but without limitation, the right to
receive any amounts due or accrued to Assignor under the Operative Agreements as
of a time prior to such date and the right to receive any indemnity payment
pursuant to the Participation Agreement with respect to events occurring or
liabilities accruing on or prior to such date) (the "RETAINED ASSETS") and (ii)
for the Tax Indemnity Agreement.

            3. TERMINATION OF TAX INDEMNITY AGREEMENT AND RELEASE OF TAX CLAIMS.
The Assignor and Assignee hereby agree that the Tax Indemnity Agreement shall be
and is



terminated as of the date of this Agreement and Assignee shall have no further
liability to Assignor thereunder. In addition, Assignor hereby expressly
releases Assignee from, and now and forever waives any claim for, any liability
in respect of taxes and any loss of any tax benefit (including, but not limited
to, any claim pursuant to the Tax Indemnity Agreement) (i) existing or arising
on, or prior to, the date hereof or (ii) based on any acts, omissions, or events
occurring on, or prior to, the date hereof, except for any liability in respect
of sales or transfer taxes arising from or in connection with the assignment
described in paragraph 2 hereof. In addition, Assignee hereby expressly releases
Assignor from, and now and forever waives any claim for, any liability in
respect of taxes and any realization of any tax benefit (including, but not
limited to, any claim pursuant to the Tax Indemnity Agreement) (i) existing or
arising on, or prior to, the date hereof or (ii) based on any acts, omissions,
or events occurring on, or prior to, the date hereof.

            4. ASSUMPTION. Assignee hereby accepts the assignment set forth in
paragraph 2 hereof and assumes and undertakes all of the duties and obligations
of Assignor accruing from and after the date hereof (excluding any duties and
obligations of Assignor required to be performed by it on or prior to the date
hereof under the Operative Agreements to which the Owner Participant is a party
and any of the other Operative Agreements by which Assignor is bound or any
other contract, agreement, document or other instrument relating to the Trust
Estate to which the Owner Participant is a party or by which it is bound and any
liabilities of the Assignor arising from such duties and obligations) pursuant
to the Trust Agreement, the Participation Agreement and each other Operative
Agreement to which Assignor is a party or by which Assignor is bound, including,
without limitation, any obligations it may have under any Operative Agreement
with regard to the Lessee, the Mortgagee or the Owner Trustee, excluding,
however, the Tax Indemnity Agreement. Assignee hereby confirms that from and
after the date hereof it (i) shall be deemed a party to the Participation
Agreement, the Trust Agreement and each other Operative Agreement to which the
Owner Participant is a party other than the Tax Indemnity Agreement, (ii) shall
be deemed the party named as the "Owner Participant" in the Trust Agreement, the
Participation Agreement, the Lease and the Trust Indenture and (iii) except as
expressly provided in this paragraph 4, shall be bound by all of the terms of
each Operative Agreement to which Assignor is a party or by which it is bound,
other than the Tax Indemnity Agreement (including the agreements and obligations
of the Assignor set forth therein) as if therein named the Owner Participant.

            5. RELEASE OF ASSIGNOR. Except for liabilities not expressly assumed
by Assignee under Section 4 hereof, upon the date hereof, Assignor is released
from all of its duties, obligations and liabilities under the Participation
Agreement and the Trust Agreement and each other Operative Agreement to which
Assignor is a party or by which Assignor is bound; PROVIDED, HOWEVER, that
Assignor shall in no event be released from any such liability arising on
account of any breach on or prior to the date hereof by Assignor of any of its
representations, warranties, covenants or obligations set forth in the
Participation Agreement or the Trust Agreement, or for any misconduct engaged in
by it prior to the date hereof, or from any obligation that relates to any
indemnity claimed by Assignor or any Lessor Lien arising from or attributable to
Assignor.


                                      -2-


            6. PAYMENTS. Assignor hereby covenants and agrees to pay over to
Assignee, if and when received following the date hereof, any amounts (including
any sums payable as interest in respect thereof) paid to or for the benefit of
Assignor that, under Section 2 hereof, belong to Assignee, and Assignee hereby
covenants and agrees to pay over to Assignor, if and when received following the
date hereof, any amounts (including any sums payable as interest in respect
thereof) paid to or for the benefit of Assignee that, under Section 2 hereof,
belong to Assignor.

            7. REPRESENTATIONS AND WARRANTIES OF ASSIGNOR. Assignor represents
and warrants that:

            (a) it is a Delaware corporation, duly organized and validly
      existing in good standing under the Laws of the State of Delaware and has
      the requisite power, authority and legal right to enter into and carry out
      the transactions contemplated hereby;

            (b) this Agreement has been duly authorized, executed and delivered
      by it and constitutes the legal, valid and binding obligation of Assignor,
      enforceable against it in accordance with its terms;

            (c) no action or proceeding is pending, has been instituted or, to
      the knowledge of Assignor, is threatened, before any court or governmental
      agency, nor has any order, judgment or decree been issued or, to the
      knowledge of Assignor, is threatened, by any court or governmental agency
      which would materially adversely affect the ability of Assignor to
      complete and consummate its obligations contemplated hereby;

            (d) the Trust Estate is free of Lessor Liens attributable to it;

            (e) it has fully performed all of its obligations under the
      Participation Agreement and under each other Operative Agreement to which
      it is a party or by which it is bound, which obligations by their terms
      are required to be satisfied or performed prior to the date hereof;

            (f) neither the execution, delivery and performance by it of this
      Agreement, nor compliance by it with any of the provisions thereof
      requires or will require any approval of its stockholders, or approval or
      consent of any trustees or holders of any indebtedness or obligations of
      it or contravenes or will contravene any Law or any order of any court or
      governmental authority or agency applicable to or binding on it or
      contravenes or will contravene the provisions of, or constitute a default
      under, its Certificate of Incorporation or Bylaws or any indenture,
      mortgage, contract or any agreement or instrument to which it is a party
      or by which it or any of its property may be bound or affected;

            (g) no authorization or approval or other action by, and no notice
      to or filing with, any governmental authority or regulatory body (other
      than as required by the Act, or the regulations promulgated thereunder) is
      required for the due execution, delivery or performance by it of this
      Agreement;


                                      -3-


            (h) the transfer to Assignee of all of the Assignor's right, title
      and interest in each Operative Agreement to which it is a party or by
      which it is bound, will not violate any provision of the Act, the
      Securities Act (and no registration pursuant to such Securities Act or the
      rules and regulations thereunder shall be required in connection with such
      transfer), or any other applicable law. Notwithstanding the foregoing, no
      representation is being made in this Section 7 with respect to the absence
      of violations of ERISA;

            (i) no Person action on behalf of Assignor is or will be entitled to
      any broker's fee, commission or finder's fee in connection with the
      transactions contemplated by this Agreement; and

            (j) other than the Purchase Agreement, dated as of July 27, 2004,
      between Assignor and Assignee and the Retained Assets, there are no other
      contracts, agreements, documents or instruments related to the Trust
      Estate by which Assignor is bound.

            8. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents
and warrants that:

            (a) Assignee is a corporation duly incorporated, validly existing
      and in good standing under the Laws of the State of Delaware and has the
      corporate power and authority to conduct the business in which it is
      currently engaged and to own or hold under lease its properties and to
      enter into, and perform its obligations under the agreements assigned to
      and assumed by Assignee under this Agreement. Assignee's parent, Atlas
      Worldwide Holdings, Inc., a Delaware corporation ("GUARANTOR"), will
      provide a guaranty ("GUARANTY") of the obligations of the Assignee in
      accordance with Section 10.1.1(a)(vi) of the Participation Agreement and
      has tangible Net Worth of at least $75,000,000;

            (b) Assignee has taken, or caused to be taken, all necessary
      corporate action (including, without limitation, the obtaining of any
      consent or approval of stockholders required by its Certificate of
      Incorporation or Bylaws) to authorize the execution and delivery of this
      Agreement and the performance of its obligations hereunder and the
      agreements assigned to and assumed by Assignee under this Agreement;

            (c) the execution and delivery by Assignee of this Agreement, the
      performance by Assignee of its obligations hereunder, and under the
      agreements assigned to and assumed by Assignee under this Agreement, and
      the consummation by Assignee on the date of this Agreement of the
      transactions contemplated hereby and thereby, do not and will not (i)
      violate any provision of its Certificate of Incorporation or Bylaws, (ii)
      violate any Law applicable to or binding on the Assignee (it being
      understood that this representation is not made with respect to any Law to
      the extent that such Law relates to ERISA or any Plan) or (iii) violate or
      constitute any default under (other than any violation or default that
      would not result in a Material Adverse Change to Assignee), or result in
      the creation of any


                                      -4-


      Lien (other than as provided for or otherwise permitted in the Operative
      Agreements) upon the Trust Estate, under any indenture, mortgage, chattel
      mortgage, deed of trust, conditional sales contract, lease, loan or other
      material agreement, instrument or document to which Assignee is a party or
      by which Assignee or any of its properties is bound or may be affected in
      any material respect;

            (d) the execution and delivery by Assignee of this Agreement, the
      performance by Assignee of its obligations hereunder, and under the
      agreements assigned to and assumed by Assignee under this Agreement, and
      the consummation by Assignee on the date of this Agreement of the
      transactions contemplated hereby and thereby do not and will not require
      the consent or approval of, or the giving of notice to, or the
      registration with, or the recording or filing of any documents with, or
      the taking of any other action in respect of (i) any trustee or other
      holder of any Debt of Assignee and (ii) any Government Entity other than
      the filing of (A) this Agreement, (B) Amendment No. 1 to Trust Agreement
      dated as of August 16, 2004 between the Owner Trustee and the Assignee
      (the "TRUST AMENDMENT"), and (C) an affidavit of citizenship by each of
      the Assignee and the Owner Trustee pursuant to Section 47.7(c)(2)(ii) of
      the Federal Aviation Regulations;

            (e) this Agreement has been duly authorized, executed and delivered
      by Assignee, and this Agreement and the agreements assigned to and assumed
      by Assignee under this Agreement (assuming the due authorization,
      execution and delivery by each party to such documents other than
      Assignee) constitute the legal, valid and binding obligations of Assignee
      and are enforceable against Assignee in accordance with the respective
      terms thereof, except as such enforceability may be limited by bankruptcy,
      insolvency, reorganization, receivership, moratorium and other similar
      Laws affecting the rights of creditors generally and general principles of
      equity, whether considered in a proceeding at law or in equity;

            (f) no part of the funds to be used by Assignee or Guarantor to
      acquire or hold its interests in the Trust Estate to be acquired by it
      under this Agreement directly or indirectly constitutes assets of a Plan;

            (g) there are no pending or, to the Actual Knowledge of Assignee,
      threatened actions or proceedings against Assignee or Guarantor before any
      court, governmental body, arbitration board, administrative agency or
      tribunal which, if determined adversely to Assignee or Guarantor, would
      materially adversely affect the ability of Assignee to perform its
      obligations under this Agreement or any of the agreements assigned to and
      assumed by Assignee under this Agreement or the Guarantor to perform its
      obligations under the Guaranty, except as has been and disclosed by
      Assignee in its public filings with the Securities and Exchange Commission
      and in the disclosure statement, as amended, filed in connection with the
      plan of reorganization with the United States Bankruptcy Court for the
      Southern District of Florida;

            (h) neither Assignee nor any person Assignee has authorized to act
      on its behalf has directly or indirectly offered any beneficial interest
      in or Security relating


                                      -5-


      to the ownership of the Aircraft or any interest in the Trust Estate, or
      any of the Equipment Notes or any other interest in or Security under the
      Trust Indenture for sale to, or solicited any offer to acquire any of the
      same from, any Person in violation of the Securities Act or applicable
      state securities Laws;

            (i) no Person acting on behalf of Assignee or Guarantor is or will
      be entitled to any broker's fee, commission or finder's fee in connection
      with the transactions contemplated by this Agreement;

            (j) other than as provided in Section 8.4.3 of Amendment No. 1 to
      Lease Agreement (the "LEASE AMENDMENT") dated as of July 27, 2004, by and
      between Assignee and Lessor, Assignee's beneficial interest in the Trust
      Estate is being acquired for it by its own account, for investment and not
      with a view to any resale or distribution thereof, except that, subject to
      the restrictions on transfer set forth in Section 10 of the Participation
      Agreement and the transfer requirements contained in Section 8.4.3 of the
      Lease Amendment, the disposition by Assignee of its beneficial interest in
      the Trust Estate shall at all times be within its control;

            (k) Assignee satisfies the "Transferee" requirements set forth in
      Section 10.1.1(a)(vi) of the Participation Agreement by virtue of the
      Trust Amendment;

            (l) the Trust Estate is free of Lessor Liens attributable to it; and

            (m) after giving effect to this assignment, there will be no more
      than one Owner Participant with respect to the Transaction;

            9. GOVERNING LAW. THIS ASSIGNMENT AND ASSUMPTION AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
INCLUDING ALL MATTERS OF CONTRUCTION, VALIDITY AND PERFORMANCE.

            10. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which together shall constitute a single instrument. It
shall not be necessary that any counterpart be signed by both parties so long as
each party shall sign at least one counterpart.

            11. BENEFICIARIES. Each of the Owner Trustee, the Lessee, the Note
Holders and the Mortgagee, together with their respective successors and
permitted assigns, is and shall be deemed a third party beneficiary of this
Agreement entitled to enforce this Agreement directly and in its own name and
enforce any rights or claims of the parties hereto.

            12. FURTHER ASSURANCES. Each party agrees that from time to time
after the date hereof, it shall execute and deliver or cause to be executed and
delivered such instruments, documents and papers, and take all such further
action as may be reasonably required in order to consummate fully the purposes
of this Agreement and to implement the transactions contemplated hereby.

               [Remainder of this page intentionally left blank.]


                                      -6-


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

                                           FINOVA CAPITAL CORPORATION

                                           By: /s/ Maryann V. Richandson
                                               ---------------------------------
                                               Name: Maryann V. Richandson
                                               Title: Vice President


                                           ATLAS AIR, INC.

                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer


                                      -7-

EX-10.1.3

                                                                  EXHIBIT 10.1.3


                      ASSIGNMENT AND ASSUMPTION AGREEMENT

            ASSIGNMENT AND ASSUMPTION AGREEMENT (this "AGREEMENT") dated as of
August 17, 2004, between BANKERS COMMERCIAL CORPORATION, a California
corporation ("ASSIGNOR") and ATLAS AIR, INC., a Delaware corporation
("ASSIGNEE").

                                  WITNESSETH:

            WHEREAS, the parties hereto desire to effect (a) the transfer by
Assignor to Assignee of all of the right, title and interest of Assignor, except
as to Retained Assets (as defined below), in, under and respect to, among other
things, (i) the Participation Agreement dated as of December 29, 2000 among
Atlas Air, Inc., as Lessee, Bankers Commercial Corporation (as successor to Banc
of America Leasing & Capital, LLC), as Owner Participant, Wells Fargo Bank
Northwest, National Association (as successor to First Security Bank, National
Association), not in its individual capacity, except as expressly provided
therein, but solely as Owner Trustee, and Wilmington Trust Company, not in its
individual capacity, except as expressly provided therein, but solely as
Mortgagee, Subordination Agent and Pass Through Trustee, as amended, modified or
supplemented and in effect from time to time (the "PARTICIPATION AGREEMENT")
relating to one Boeing model 747-47UF aircraft bearing manufacturer's serial
number 29257 and U.S. registration mark N496MC, including, without limitation,
any indemnity payments payable by the Lessee directly or indirectly thereunder,
(ii) the Trust Agreement identified in the Participation Agreement, (iii) the
Trust Estate (as defined in the Trust Agreement), (iv) the proceeds therefrom;
and (b) the assumption by Assignee of the obligations of Assignor accruing
thereunder; and

            WHEREAS, such documents permit such transfer upon satisfaction of
certain conditions heretofore or concurrently herewith being complied with;

            NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:

            1. DEFINITIONS. Capitalized terms used herein without definition
shall have the respective meanings ascribed thereto in the Participation
Agreement.

            2. ASSIGNMENT. Assignor has sold, conveyed, assigned, transferred
and set over, and does hereby sell, convey, assign, transfer and set over, unto
Assignee, as of the date hereof, all of its present and future right, title and
interest in, under and with respect to the Participation Agreement, the Trust
Agreement, the Trust Estate and all of the other Operative Agreements to which
Assignor is a party, and any proceeds therefrom, together with all other
documents and instruments evidencing any of such right, title and interest,
except (i) the right to receive any indemnity payment pursuant to the
Participation Agreement with respect to events occurring prior to such date and
(ii) Assignor's rights to the option payments previously paid by Assignee to
Assignor under the Purchase Agreement dated as of January 30, 2004 between
Assignor and Assignee (collectively, the "RETAINED ASSETS").

            3. ASSUMPTION. Assignee hereby accepts the assignment set forth in
paragraph 2 hereof and assumes and undertakes all of the duties and obligations
of Assignor accruing from and after the date hereof (excluding any duties and
obligations of



Assignor required to be performed by it on or prior to the date hereof under the
Operative Agreements to which the Owner Participant is a party and any of the
other Operative Agreements by which Assignor is bound or any other contract,
agreement, document or other instrument relating to the Trust Estate to which
the Owner Participant is a party or by which it is bound or with respect to
events occurring prior to the date hereof and any liabilities of the Assignor
arising from such duties and obligations) pursuant to the Trust Agreement, the
Participation Agreement and each other Operative Agreement to which Assignor is
a party or by which Assignor is bound, including, without limitation, any
obligations it may have under any Operative Agreement with regard to the Lessee,
the Mortgagee or the Owner Trustee. Assignee hereby confirms that from and after
the date hereof it (i) shall be deemed a party to the Participation Agreement,
the Trust Agreement and each other Operative Agreement to which the Owner
Participant is a party, (ii) shall be deemed the party named as the "Owner
Participant" in the Trust Agreement, the Participation Agreement, the Lease and
the Trust Indenture and (iii) except as expressly provided in this paragraph 3,
shall be bound by all of the terms of each Operative Agreement to which Assignor
is a party or by which it is bound, (including the agreements and obligations of
the Assignor set forth therein) as if therein named the Owner Participant.

            4. RELEASE OF ASSIGNOR. Except for liabilities not expressly assumed
by Assignee under Section 3 hereof, upon the effectiveness of this Agreement,
Assignor shall be relieved of all of its liabilities under the Participation
Agreement and the Trust Agreement and any other Operative Agreement to which it
is a party; PROVIDED, HOWEVER, that Assignor shall in no event be released from
any such liability arising or relating to any event occurring prior to the date
hereof, or for any misconduct engaged in by it prior to the date hereof, or from
any obligation that relates to any indemnity claimed by Assignor or any Lessor
Lien arising from attributable to Assignor.

            5. PAYMENTS. Assignor hereby covenants and agrees to pay over to
Assignee, if and when received following the date hereof, any amounts (including
any sums payable as interest in respect thereof) paid to or for the benefit of
Assignor that, under Section 2 hereof, belong to Assignee, and Assignee hereby
covenants and agrees to pay over to Assignor, if and when received following the
date hereof, any amounts (including any sums payable as interest in respect
thereof) paid to or for the benefit of Assignee that, under Section 2 hereof,
belong to Assignor.

            6. [Reserved.]

            7. REPRESENTATIONS AND WARRANTIES OF ASSIGNOR. Assignor represents
and warrants that:

            (a) it is a corporation duly organized and validly existing in good
      standing under the Laws of the State of California and has the requisite
      power, authority and legal right to enter into and carry out the
      transactions contemplated hereby;

            (b) this Agreement has been duly authorized, executed and delivered
      by it and constitutes the legal, valid and binding obligation of Assignor,
      enforceable against it in accordance with its terms;


                                      -2-


            (c) no action or proceeding is pending, has been instituted or, to
      the knowledge of Assignor, is threatened, before any court or governmental
      agency, nor has any order, judgment or decree been issued or, to the
      knowledge of Assignor, is threatened, by any court or governmental agency
      which would materially adversely affect the ability of Assignor to
      complete and consummate its obligations contemplated hereby;

            (d) the Trust Estate is free of Lessor Liens attributable to it;

            (e) it has fully performed all of its obligations under the
      Participation Agreement and under each other Operative Agreement to which
      it is a party or by which it is bound, which obligations by their terms
      are required to be satisfied or performed prior to the effectiveness of
      this Agreement or prior to the consummation of the transactions
      contemplated hereby;

            (f) neither the execution, delivery and performance by it of this
      Agreement, nor compliance by it with any of the provisions thereof
      requires or will require any approval of its stockholders, or approval or
      consent of any trustees or holders of any indebtedness or obligations of
      it or contravenes or will contravene any Law or any order of any court or
      governmental authority or agency applicable to or binding on it or
      contravenes or will contravene the provisions of, or constitute a default
      under, its Certificate of Incorporation or By-laws or any indenture,
      mortgage, contract or any agreement or instrument to which it is a party
      or by which it or any of its property may be bound or affected;

            (g) no authorization or approval or other action by, and no notice
      to or filing with, any governmental authority or regulatory body (other
      than as required by the Act, or the regulations promulgated thereunder) is
      required for the due execution, delivery or performance by it of this
      Agreement;

            (h) the transfer to Assignee of all of the Assignor's right, title
      and interest as Owner Participant will not violate any provision of the
      Act, the Securities Act (and no registration pursuant to such Securities
      Act or the rules and regulations thereunder shall be required in
      connection with such transfer), or any other applicable law.
      Notwithstanding the foregoing, no representation is being made in this
      Section 7 with respect to the absence of violations of ERISA;

            (i) no Person action on behalf of Assignor is or will be entitled to
      any broker's fee, commission or finder's fee in connection with the
      transactions contemplated by this Agreement; and

            (j) other than the documents assigned by Assignor to Assignee
      pursuant to Section 2 and the Retained Assets, there are no other
      contracts, agreements, documents or instruments related to the Trust
      Estate by which Assignor is bound.

            8. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents
and warrants that:


                                      -3-


            (a) Assignee is a corporation duly incorporated, validly existing
      and in good standing under the Laws of the State of Delaware and has the
      corporate power and authority to conduct the business in which it is
      currently engaged and to own or hold under lease its properties and to
      enter into, and perform its obligations under the Owner Participant
      Agreements. Assignee's parent, Atlas Worldwide Holdings, Inc., a Delaware
      corporation ("GUARANTOR"), will provide a guaranty ("GUARANTY") of the
      obligations of the Assignee in accordance with Section 10.1.1(a)(vi) of
      the Participation Agreement, has a Net Worth of at least $75,000,000;

            (b) Assignee has taken, or caused to be taken, all necessary
      corporate action (including, without limitation the obtaining of any
      consent or approval of stockholders required by its Certificate of
      Incorporation or By-laws) to authorize the execution and delivery of this
      Agreement and the performance of its obligations hereunder;

            (c) the execution and delivery by Assignee of this Agreement, the
      performance by Assignee of its obligation hereunder and under the
      agreements assigned to and assumed by Assignee under this Agreement and
      the consummation by Assignee on the date of this Agreement of the
      transactions contemplated hereby and thereby, do not and will not (a)
      violate any provision of its Certificate of Incorporation or By-laws of
      Assignee, (b) violate any Law applicable to or binding on the Assignee (it
      being understood that this representation is not made with respect to any
      Law to the extent that such Law relates to ERISA or any Plan) or (c)
      violate or constitute any default under (other than any violation or
      default that would not result in a Material Adverse Change to Assignee),
      or result in the creation of any Lien (other than as provided for or
      otherwise permitted in the Operative Agreements) upon the Trust Estate,
      under any indenture, mortgage, chattel mortgage, deed of trust,
      conditional sales contract, lease, loan or other material agreement,
      instrument or document to which Assignee is a party or by which Assignee
      or any of its properties is bound or may be affected in any material
      respect;

            (d) the execution and delivery by Assignee of this Agreement, the
      performance by Assignee of its obligations hereunder and under the
      agreements assigned to and assumed by Assignee under this Agreement and
      the consummation by Assignee on the date of this Agreement of the
      transactions contemplated hereby and thereby do not and will not require
      the consent or approval of, or the giving of notice to, or the
      registration with, or the recording or filing of any documents with, or
      the taking of any other action in respect of (a) any trustee or other
      holder of any Debt of Assignee and (b) any Government Entity other than
      the filing of (i) this Agreement, (ii) Amendment No. 2 to Trust Agreement
      dated as of August 17, 2004 between the Owner Trustee and the Assignee
      (the "TRUST AMENDMENT"), and (iii) an affidavit of citizenship by each of
      the Assignee and the Owner Trustee pursuant to Section 47.7(c)(2)(ii) of
      the Federal Aviation Regulations;

            (e) this Agreement has been duly authorized, executed and delivered
      by Assignee, and this Agreement and the agreements assigned to and assumed
      by Assignee under this Agreement (assuming the due authorization,
      execution and delivery by each party to such documents other than
      Assignee) constitute the legal, valid and


                                      -4-


      binding obligations of Assignee and are enforceable against Assignee in
      accordance with the respective terms thereof, except as such
      enforceability may be limited by bankruptcy, insolvency, reorganization,
      receivership, moratorium and other similar Laws affecting the rights of
      creditors generally and general principles of equity, whether considered
      in a proceeding at law or in equity;

            (f) no part of the funds to be used by Assignee or Guarantor to
      acquire or hold its interests in the Trust Estate to be acquired by it
      under this Agreement directly or indirectly constitutes assets of a Plan;

            (g) there are no pending or, to the Actual Knowledge of Assignee,
      threatened actions or proceedings against Assignee or Guarantor before any
      court, governmental body, arbitration board, administrative agency or
      tribunal which, if determined adversely to Assignee or Guarantor, would
      materially adversely affect the ability of Assignee to perform its
      obligations under this Agreement or any of the agreements assigned to and
      assumed by Assignee under this Agreement or the Guarantor to perform its
      obligations under the Guaranty;

            (h) neither Assignee nor any person Assignee has authorized to act
      on its behalf has directly or indirectly offered any beneficial interest
      in or Security relating to the ownership of the Aircraft or any interest
      in the Trust Estate, or any of the Equipment Notes or any other interest
      in or Security under the Trust Indenture for sale to, or solicited any
      offer to acquire any of the same from, any Person in violation of the
      Securities Act or applicable state securities Laws;

            (i) no Person acting on behalf of Assignee or Guarantor is or will
      be entitled to any broker's fee, commission or finder's fee in connection
      with the transactions contemplated by this Agreement;

            (j) Assignee satisfies the "Transferee" requirements set forth in
      Section 10.1.1(a)(v) of the Participation Agreement by virtue of the Trust
      Amendment;

            (k) the Trust Estate is free of Lessor Liens attributable to it; and

            (l) after giving effect to this assignment, there will be no more
      than one Owner Participant with respect to the Transaction;

            9. GOVERNING LAW. THIS ASSIGNMENT AND ASSUMPTION AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
INCLUDING ALL MATTERS OF CONTRUCTION, VALIDITY AND PERFORMANCE.

            10. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which together shall constitute a single instrument. It
shall not be necessary that any counterpart be signed by both parties so long as
each party shall sign at least one counterpart.


                                      -5-


            11. BENEFICIARIES. Each of the Owner Trustee, the Lessee, the Note
Holders and the Mortgagee, together with their respective successors and
permitted assigns, is and shall be deemed a third party beneficiary of this
Agreement entitled to enforce this Agreement directly and in its own name and
enforce any rights or claims of the parties hereto.

            12. FURTHER ASSURANCES. Each party agrees that from time to time
after the date hereof, it shall execute and deliver or cause to be executed and
delivered such instruments, documents and papers, and take all such further
action as may be reasonably required in order to consummate fully the purposes
of this Agreement and to implement the transactions contemplated hereby.

                                    *******


                                      -6-


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

                                           BANKERS COMMERCIAL CORPORATION

                                           By: /s/ Melisa Wilson
                                               ---------------------------------
                                               Name: Melisa Wilson
                                               Title: Vice President


                                           ATLAS AIR, INC.

                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer


                                      -7-

EX-10.1.4

                                                                  EXHIBIT 10.1.4


                      ASSIGNMENT AND ASSUMPTION AGREEMENT

      ASSIGNMENT AND ASSUMPTION AGREEMENT (this "AGREEMENT") dated as of August
27, 2004 (the "EFFECTIVE Date"), between DVB Bank AG ("ASSIGNOR") and Atlas Air,
Inc., a Delaware corporation ("ASSIGNEE").

                                  WITNESSETH:

      WHEREAS, the parties hereto desire to effect (a) the transfer by Assignor
to Assignee of all of the right, title and interest of Assignor, as Owner
Participant, in, under and with respect to, among other things, (i) the
Participation Agreement dated as of December 28, 2000 among Atlas Air, Inc., as
Lessee, DVB Bank AG (as assignee of NCC Key Company, a Delaware corporation), as
Owner Participant, Wells Fargo Bank Northwest, National Association (formerly
known as First Security Bank, National Association), not in its individual
capacity, except as expressly provided therein, but solely as Owner Trustee, and
Wilmington Trust Company, not in its individual capacity, except as expressly
provided therein, but solely as Mortgagee, Subordination Agent and Pass Through
Trustee, as amended, modified or supplemented and in effect from time to time
(as amended, supplemented or otherwise modified through the Effective Date, the
"PARTICIPATION AGREEMENT") relating to one Boeing model 747-47UF aircraft
bearing manufacturer's serial number 30558 and U.S. registration mark N409MC,
including, without limitation, any indemnity payments payable by the Lessee
directly or indirectly thereunder, (ii) the Trust Agreement dated as of Decenber
28, 2000, as amended by Amendment No. 1 to Trust Agreement dated as of August
29, 2003, identified in the Participation Agreement, (iii) the Trust Estate (as
defined in the Trust Agreement) and (iv) the proceeds therefrom and (b) the
assumption by Assignee of the obligations of Assignor accruing thereunder; and

      WHEREAS, such documents permit such transfer upon satisfaction of certain
conditions heretofore or concurrently herewith being complied with;

      NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:

      1. DEFINITIONS. Capitalized terms used herein without definition shall
have the respective meanings ascribed thereto in the Participation Agreement.

      2. ASSIGNMENT. Assignor does hereby sell, convey, assign, transfer and set
over, unto Assignee, as of the Effective Date, all of its present and future
right, title and interest in, under and with respect to the Participation
Agreement, the Trust Agreement, the Trust Estate and all of the other Operative
Agreements to which Assignor is a party, and any proceeds therefrom, together
with all other documents and instruments evidencing any of such right, title and
interest, except (i) such rights of Assignor as have arisen or accrued to
Assignor prior to the Effective Date (including specifically, but without
limitation, the right to receive any amounts due or accrued to Assignor under
the Operative Agreements as of a time prior to such date and the right to
receive any indemnity payment pursuant to the Participation Agreement with
respect to events occurring prior to such date) (the "EXCLUDED MATTERS").

      3. RELEASE OF TAX CLAIMS. Assignor hereby expressly releases Assignee
from, and now and forever waives any claim for, any liability in respect of
taxes and any loss of any tax



benefit (i) existing or arising on, or prior to, the date hereof or (ii) based
on any acts, omissions, or events occurring on or prior to, the date hereof,
except for any liability in respect of sales or transfer taxes arising from or
in connection with the assignment described in Section 2 hereof. In addition,
Assignee hereby expressly releases Assignor from, and now and forever waives any
claim for, any liability in respect of taxes and any realization of any tax
benefit (i) existing or arising on, or prior to, the date hereof of (ii) based
on any acts, omissions, or events occurring on, or prior to, the date hereof.

      4. ASSUMPTION. Assignee hereby accepts the assignment set forth in Section
2 hereof and assumes and undertakes all of the duties and obligations of
Assignor accruing from and after the Effective Date (excluding any duties and
obligations of Assignor required to be performed by it on or prior to the
Effective Date under the Operative Agreements to which the Owner Participant is
a party and any of the other Operative Agreements by which Assignor is bound or
any other contract, agreement, document and other instrument relating to the
Trust Estate to which the Owner Participant is a party or by which it is bound)
pursuant to the Trust Agreement, the Participation Agreement and each other
Operative Agreement to which Assignor is a party or by which Assignor is bound,
including, without limitation, any obligations it may have under any Operative
Agreement with regard to the Lessee, the Mortgagee or the Owner Trustee,
provided that the foregoing assumption shall exclude the Excluded Matters.
Assignee hereby confirms that, except in respect of the Excluded Matters, from
and after the Effective Date it (i) shall be deemed a party to the Participation
Agreement, the Trust Agreement and each other Operative Agreement to which the
Owner Participant is a party, (ii) shall be deemed the party named as the "Owner
Participant" in the Trust Agreement, the Participation Agreement, the Lease and
the Trust Indenture and (iii) shall be bound by all of the terms of each
Operative Agreement to which Assignor is a party or by which it is bound and
each of such other contracts, agreements, documents or other instruments
referred to in this Section 4 (including the agreements and obligations of the
Assignor set forth therein) as if therein named the Owner Participant.

      5. RELEASE OF ASSIGNOR. Except for liabilities not expressly assumed by
Assignee under Section 4 hereof, on the Effective Date, Assignor shall be
relieved of all of its liabilities under the Participation Agreement, the Trust
Agreement and other Operative Agreements; provided, however, that Assignor shall
in no event be released from any such liability arising or relating to any event
occurring prior to the Effective Date, or on account of any breach by Assignor
of any of its representations, warranties, covenants or obligations set forth in
the Participation Agreement or the Trust Agreement, or from any obligation that
relates to any indemnity claimed by Assignor or any Lessor Lien arising from or
attributable to Assignor.

      6. PAYMENTS. From and after the Effective Date, Assignor hereby covenants
and agrees to pay over to Assignee, if and when received following the Effective
Date, any amounts (including any sums payable as interest in respect thereof)
paid to or for the benefit of Assignor that, under Section 2 hereof, belong to
Assignee, and Assignee hereby covenants and agrees to pay over to Assignor, if
and when received following the Effective Date, any amounts (including any sums
payable as interest in respect thereof) paid to or for the benefit of Assignee
that, under Section 2 hereof, belong to Assignor.


                                      -2-


      7. INVESTMENT PURPOSE. Other than as provided in Section 8.4.3 of
Amendment No. 1 to Lease Agreement (the "LEASE AMENDMENT") dated as of July
27, 2004, by and between Assignee and Lessor, Assignee hereby represents that it
is acquiring the Trust Estate interests and other interests hereby assigned to
it for its own account for the purpose of investment and not with a view to the
distribution or resale of either thereof, subject, nevertheless, to the
disposition of such interests being at all times within Assignee's control.

      8. REPRESENTATIONS AND WARRANTIES OF ASSIGNOR. Assignor represents and
warrants that:

            (a) it is a company duly organized, validly existing in good
standing under the Laws of Germany and has the requisite power, authority and
legal right to enter into and carry out the transactions contemplated hereby;

            (b) this Agreement has been duly authorized, executed and delivered
by it and constitutes the legal, valid and binding obligation of Assignor,
enforceable against it in accordance with its terms;

            (c) no action or proceeding is pending, has been instituted or, to
the knowledge of Assignor, is threatened, before any court or governmental
agency, nor has any order, judgment or decree been issued or, to the knowledge
of Assignor, is threatened by any court or governmental agency which would
materially adversely affect the ability of Assignor to complete and consummate
its obligations contemplated hereby;

            (d) the Trust Estate is free of Lessor Liens attributable to it;

            (e) it has fully performed all of its obligations under the
Participation Agreement and under each other Operative Agreement to which it is
a party or by which it is bound, which obligations by their terms are required
to be satisfied or performed prior to the Effective Date;

            (f) neither the execution, delivery and performance by it of this
Agreement, nor compliance by it with any of the provisions thereof requires or
will require any approval of its stockholders, or approval or consent of any
trustees or holders of any indebtedness or obligations of it or contravenes or
will contravene any law or any order of any court or governmental authority or
agency applicable to or binding on it or contravenes or will contravene the
provisions of, or constitute a default under, its Certificate of Incorporation
or By-Laws or any indenture, mortgage, contract or any agreement or instrument
to which it is a party or by which it or any of its property may be bound or
affected;

            (g) no authorization or approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body (other than as
required by the Act, or the regulations promulgated thereunder) is required for
the due execution, delivery or performance by it of this Agreement or, if so
required, has been obtained or effected; and

            (h) the transfer to Assignee of all of the Assignor's right, title
and interest as Owner Participant will not violate any provision of the Act.
Notwithstanding the foregoing, no representation is being made in this Section 8
with respect to the absence of violations of ERISA;


                                      -3-


      9. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents and
warrants that:

            (a) it is a corporation duly incorporated, validly existing and in
good standing under the Laws of the State of Delaware and has the requisite
power, authority and legal right to conduct the business in which it is
currently engaged and to own or hold under lease its properties and to enter
into, and perform its obligations under the Owner Participant Agreements;

            (b) Assignee's parent has a tangible net worth at least equal to $75
million;

            (c) Assignee has taken, or caused to be taken, all necessary
corporate action (including, without limitation, the obtaining of any consent or
approval of stockholders required by its constituent documents) to authorize the
execution and delivery of this Agreement and the performance of its obligations
hereunder;

            (d) the execution and delivery by Assignee of this Agreement, the
performance by Assignee of its obligation hereunder and under the agreements
assigned to and assumed by Assignee under this Agreement and the consummation by
Assignee on the Effective Date of the transactions contemplated hereby, do not
and will not (i) violate any provision of its constituent documents, (ii)
violate any Law applicable to or binding on Assignee (it being understood that
this representation is not made with respect to any Law to the extent that such
Law relates to ERISA or any Plan) or (iii) violate or constitute any default
under (other than any violation or default that would not result in a Material
Adverse Change to Assignee), or result in the creation of any Lien (other than
as provided for or otherwise permitted in the Operative Agreements) upon the
Trust Estate under, any indenture, mortgage, chattel mortgage, deed of trust,
conditional sales contract, lease, loan or other material agreement, instrument
or document to which Assignee is a party or by which Assignee or any of its
properties is bound or may be affected in any material respect;

            (e) the execution and delivery by Assignee of this Agreement, the
performance by Assignee of its obligations hereunder, and under the agreements
assigned to and assumed by Assignee under this Agreement, and the consummation
by Assignee on the Effective Date of the transactions contemplated hereby and
thereby do not and will not require the consent or approval of, or the giving of
notice to, or the registration with, or the recording or filing of any documents
with, or the taking of any other action in respect of (i) any trustee or other
holder of any Debt of Assignee and (ii) any Government Entity other than the
filing of (A) this Agreement, (B) Amendment No. 2 to Trust Agreement dated as of
August 27, 2004 between the Owner Trustee and the Assignee and (C) an affidavit
of citizenship by each of the Assignee and the Owner Trustee pursuant to Section
47.7(c)(2)(ii) of the Federal Aviation Regulations;

            (f) this Agreement has been duly authorized, executed and delivered
by Assignee, and this Agreement and the agreements assigned to and assumed by
Assignee under this Agreement (assuming the due authorization, execution and
delivery by each party to such documents other than Assignee) constitute the
legal, valid and binding obligations of Assignee and are enforceable against
Assignee in accordance with the respective terms thereof, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
receivership,


                                      -4-


moratorium and other similar Laws affecting the rights of creditors generally
and general principles of equity, whether considered in a proceeding at law or
in equity;

            (g) no part of the funds to be used by Assignee to acquire or hold
its interests in the Trust Estate to be acquired by it under this Agreement
directly or indirectly constitutes assets of a Plan;

            (h) there are no pending or, to the Actual Knowledge of Assignee,
threatened actions or proceedings against Assignee before any court,
governmental body, arbitration board, administrative agency or tribunal which,
if determined adversely to Assignee, would materially adversely affect the
ability of Assignee to perform its obligations under this Agreement or any of
the agreements assigned to and assumed by Assignee under this Agreement or
Assignee's parent to perform its obligations under the guaranty of Assignee's
obligations as Owner Participant, except as has been and disclosed by Assignee
and Assignee's parent in their public filings with the Securities and Exchange
Commission and in the disclosure statement, as amended, filed in connection with
the Assignee's Final Modified Second Amended Joint Plan of Reorganization which
was approved pursuant to a confirmation order entered on July 16, 2004 by the
United States Bankruptcy Court for the Southern District of Florida;

            (i) neither Assignee nor any person Assignee has authorized to act
on its behalf has directly or indirectly offered any beneficial interest in or
Security relating to the ownership of the Aircraft or any interest in the Trust
Estate, or any of the Equipment Notes or any other interest in or Security under
the Trust Indenture for sale to, or solicited any offer to acquire any of the
same from any Person in violation of the Securities Act or applicable state
securities Laws;

            (j) no Person acting on behalf of Assignee is or will be entitled to
any broker's fee, commission or finder's fee in connection with the transactions
contemplated by this Agreement;

            (k) it is a "Transferee" satisfying the requirements set forth in
Section 10.1.1 of the Participation Agreement (Assignee, as Lessee, consenting
to a transfer of an OP Interest to a commercial aircraft operator);

            (l) Assignee is a Citizen of the United States or, if not, has
established a voting trust sufficient to allow registration of the Aircraft in
the United States;

            (m) the Trust Estate is free of Lessor Liens attributable to it; and

            (n) after giving effect to this assignment, there will be no more
than one Owner Participant with respect to the Aircraft.

      10. GOVERNING LAW. THIS ASSIGNMENT AND ASSUMPTION AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
INCLUDING ALL MATTERS OF CONTRUCTION, VALIDITY AND PERFORMANCE.


                                      -5-


      11. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which together shall constitute a single instrument. It
shall not be necessary that any counterpart be singed by both parties so long as
each party shall sign at least one counterpart.

      12. BENEFICIARIES. Each of the Owner Trustee, the Lessee, the Note Holders
and the Mortgagee, together with their respective successors and permitted
assigns, is and shall be deemed a third party beneficiary of this Agreement
entitled to enforce this Agreement directly and in its own name and enforce any
rights or claims of the parties hereto.

      13. FURTHER ASSURANCES. Each party agrees that from time to time after the
Effective Date, it shall execute and deliver or cause to be executed and
delivered such instruments, documents and papers, and take all such further
action as may be reasonably required in order to consummate fully the purposes
of this Agreement and to implement the transactions contemplated hereby.

      14. EXPENSES. Each of Assignee and Assignor hereby agrees that it shall
pay its own costs and expenses (including reasonable attorneys' fees) incurred
in connection with the negotiation, preparation, execution and delivery of this
Agreement. The OP Purchase Price (as defined in the Binding Term Sheet Agreement
(the "TERM SHEET") dated as of July 27, 2004 between Assignor and Assignee)
includes all interest, out-of-pocket expenses and all other amounts owing to
Assignor or Owner Trustee not otherwise covered by the Claim (as defined in the
Term Sheet). Assignee will not pay and will not be responsible for any other
interest, fees or expenses incurred by Assignor or Owner Trustee on or after the
Effective Date.


                                      -6-


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

                                       DVB BANK AG

                                       By: /s/ Constance Laudenschlager
                                           -------------------------------------
                                           Name: Constance Laudenschlager
                                           Title: Senior Vice President

                                       By: /s/ Marc Cho
                                           -------------------------------------
                                           Name: Marc Cho
                                           Title: Vice President


                                       ATLAS AIR, INC.

                                       By: /s/ William C. Bradley
                                           -------------------------------------
                                           Name: William C. Bradley
                                           Title: Vice President & Treasurer

EX-10.5.2

                                                                  EXHIBIT 10.5.2

                                                                  EXECUTION COPY

                                HOLDINGS GUARANTY
================================================================================

                                    GUARANTY

                            Dated as of July 27, 2004

                                    given by

                       ATLAS AIR WORLDWIDE HOLDINGS, INC.

================================================================================


                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

SECTION 1. GUARANTY .......................................................   1

SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY ....................   2

SECTION 3. COVENANTS OF GUARANTOR .........................................   6
   (a)    No Assignment by Guarantor ......................................   6
   (b)    Default Under Loan Documents ....................................   6

SECTION 4. REPRESENTATIONS AND WARRANTIES OF GUARANTOR ....................   6

SECTION 5. MISCELLANEOUS ..................................................   6
   (a)    Waivers; Cumulative Effect ......................................   6
   (b)    Amendments; Waivers .............................................   6
   (c)    Severability ....................................................   6
   (d)    Counterparts ....................................................   6
   (e)    Notices .........................................................   6
   (f)    Headings, References ............................................   7
   (g)    Governing Law ...................................................   7
   (h)    Benefit and Binding Effect ......................................   7
   (i)    Service of Process; Jurisdiction and Waiver .....................   7
   (j)    Savings                                                             8

Annex A - Address for Notices to Guarantor

Schedule I - Description of Credit Agreement



                                HOLDINGS GUARANTY

            HOLDINGS  GUARANTY (this  "GUARANTY")  dated as of July 27, 2004, is
given by Atlas Air  Worldwide  Holdings,  Inc.  (the  "GUARANTOR"),  a  Delaware
corporation,  with respect to each and every  obligation of Atlas Air, Inc. (the
"COMPANY")  under the Fifth Amended and Restated Credit  Agreement,  dated as of
July 27, 2004, among the Guarantor,  the Company,  the Lenders from time to time
party thereto and Deutsche Bank Trust Company Americas,  as administrative agent
(the  "AGENT")  (as amended,  modified or  supplemented  from time to time,  the
"CREDIT  AGREEMENT") and the other Loan  Documents,  and is given to and for the
benefit  of  the  Agent  and  the   Lenders   (collectively,   the   "GUARANTEED
BENEFICIARIES" and individually,  a "GUARANTEED  BENEFICIARY").  All capitalized
terms used herein shall,  unless otherwise  defined herein,  have the respective
meanings set forth in the Credit Agreement.

                              W I T N E S S E T H:

            WHEREAS, as of the date hereof the Guarantor owns 100% of the issued
and outstanding capital stock of the Company;

            WHEREAS,  the Guarantor  entered into the Holdings Guaranty dated as
of October 31, 2002 (the "Original Holdings  Guaranty"),  in connection with the
Existing Credit Agreement;

            WHEREAS,  it is a condition  precedent to the  effectiveness  of the
Credit  Agreement,  that the Guarantor  guarantee the obligations of the Company
under  the  Credit  Agreement  and the  other  Loan  Documents  in  favor of the
Guaranteed  Beneficiaries  and  that  the  Guarantor  shall  have  executed  and
delivered to the Agent this Guaranty;

            WHEREAS,  the  Guarantor is entering  into this Guaranty in order to
induce the Agent and each Lender to enter into the Credit Agreement;

            WHEREAS,  the  Guarantor  will  obtain  benefits  from  the  Company
entering into the Credit  Agreement,  and  accordingly,  desires to execute this
Guaranty in order to satisfy the  conditions  described in the second  preceding
paragraph and to amend and restate the Original Holdings Guaranty in the form of
this Guaranty;

            NOW, THEREFORE, the Guarantor hereby agrees on behalf of and for the
benefit of the Guaranteed Beneficiaries as follows:

            SECTION 1. GUARANTY.  The Guarantor does hereby  unconditionally and
irrevocably  guarantee,  as  primary  obligor  and not  merely  as  surety,  the
following (such obligations being the "GUARANTEED OBLIGATIONS "):

            (a) to each  Guaranteed  Beneficiary,  the full and  prompt  payment
      when,  where  and as due,  of each and  every  payment  obligation  of the
      Company to each such Guaranteed Beneficiary under the Credit Agreement and
      each other Loan Document; and



            (b) to each Guaranteed  Beneficiary entitled thereto under the terms
      of any Loan Document,  the full and timely  performance  and observance by
      the Company of each and all other  covenants and  agreements not described
      in clause (a) above  required to be  performed  or observed by the Company
      under such Loan Document.

            Without  limiting the generality of the foregoing,  the  Guarantor's
liability  hereunder shall extend to all obligations that constitute part of the
Guaranteed Obligations and would be owed by the Company under the Loan Documents
but for the  fact  that  they  are  unenforceable  or not  allowable  due to the
existence of a  bankruptcy,  suspension of payments,  reorganization  or similar
proceeding involving the Company.

            SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY.

            (a) Each and every  default  in any  payment or  performance  of any
obligation  of the  Company  under any Loan  Document  to which the Company is a
party shall give rise to a separate  claim and cause of action  hereunder to the
extent that each such default by the Company would give rise to a separate claim
or cause of action under the applicable  Loan Document,  and separate  claims or
suits  may be made  and  brought,  as the case may be,  hereunder  as each  such
default occurs.

            (b) This Guaranty shall be a continuing,  absolute,  irrevocable and
unconditional  guaranty of payment and  performance  and not of  collection  and
shall remain in full force and effect until each and all of the  obligations  of
the  Company  guaranteed  hereunder  shall  have  been  fully  and  indefeasibly
discharged or performed in accordance  with the terms and provisions of the Loan
Documents (and no longer subject to  recoupment,  preference  claims or clawback
under  applicable  bankruptcy,  insolvency or similar  laws),  and the Guarantor
shall have fully  discharged  or  performed  all of its  obligations  under this
Guaranty to each Guaranteed Beneficiary.

            (c) This Guaranty and the liability of the Guarantor provided for in
Section 1 hereunder shall remain in full force and effect irrespective of:

            (i) the legality,  validity,  regularity or  enforceability,  or the
      absence  of any  thereof,  of any Loan  Document  (or  other  document  or
      agreement) or of any assignment,  amendment,  modification, or termination
      of any Loan Document (or other document or agreement), and shall in no way
      be  affected  or  impaired  by (and no  notice to the  Guarantor  shall be
      required  in respect  of) any  compromise,  waiver,  settlement,  release,
      renewal, extension,  indulgence,  amendment, addition, deletion, change or
      modification  with  respect to, or release of any  security for any of the
      obligations or liabilities of the Company under,  any Loan Document or any
      redelivery,  repossession, sale, transfer or other disposition,  surrender
      or  destruction  of, or other event or  circumstance  with respect to, the
      Financed Aircraft (or any interest therein or portion  thereof),  in whole
      or part; or

            (ii) the transfer,  assignment,  subletting,  or mortgaging,  or the
      purported transfer,  assignment,  subletting, or mortgaging, of all or any
      part of the interest of any  Guaranteed  Beneficiary or the Company in the
      Financed  Aircraft  (or  any  interest  therein  or  portion  thereof)  in
      accordance with the Loan Documents; or


                                      -2-


            (iii)  any  absence  or  defect  or  failure  of  title  or  lack of
      recordation or registration  with respect to any Guaranteed  Beneficiary's
      or the  Company's  interest  in the  Financed  Aircraft  (or any  interest
      therein or portion thereof); or

            (iv) any  failure  of  delivery  of,  or loss of  perfection  of any
      security  interest  with respect to, any portion of the Financed  Aircraft
      (or any interest therein or portion thereof); or

            (v) any matter relating to any agreement or approval (or the absence
      thereof) in connection with the Financed Aircraft (or any interest therein
      or portion thereof); or

            (vi) any failure,  neglect or omission on the part of any Guaranteed
      Beneficiary  or any  other  Person  to give the  Guarantor  notice  of the
      occurrence  of any  Default  or Event of  Default  or  Potential  Event of
      Default or Event of Default or to realize upon any collateral  held by any
      Guaranteed Beneficiary or any other Person with respect to any obligations
      or  liabilities  of the  Company,  or to provide for any  insurance on the
      Financed  Aircraft (or any  interest  therein or portion  thereof),  or to
      establish  or  maintain  a  security  or other  interest  in the  Financed
      Aircraft (or any interest  therein or portion  thereof) or any  collateral
      provided  under any Loan Document or to establish or maintain the priority
      or perfection of any thereof; or

            (vii) any defect in the compliance with  specifications,  warranties
      or any insurance policy or the condition, design, operation or fitness for
      use of, or any damage to or loss or destruction of, or any interruption or
      cessation in the use of, the Financed Aircraft (or any interest therein or
      any portion  thereof)  by the  Company or any other  Person for any reason
      whatsoever (including, without limitation, any governmental prohibition or
      restriction,  condemnation,  requisition,  seizure or any other act on the
      part of any  governmental or military  authority,  or any act of God or of
      the public  enemy)  regardless  of the duration  thereof (even though such
      duration  would  otherwise   constitute  a  frustration   under  any  Loan
      Document),  whether or not without fault on the part of the Company or any
      other Person; or

            (viii)  any  merger,   consolidation   or  other   restructuring  or
      termination of the corporate structure, reorganization or transaction with
      respect to the Company or the Guarantor  into,  with or in respect of, any
      other  Person or any sale,  lease,  assignment  or  transfer of any of the
      assets of the Company or Guarantor to any other Person; or

            (ix)  any  disposition  by  the  Guarantor  of its  interest  in the
      Company,  or any change in the ownership of any shares of capital stock of
      the Guarantor or the Company, or any change,  restructuring or termination
      of the corporate structure or existence of the Company; or

            (x) the  imposition of any Tax or other charge  against the Company,
      the Guarantor or any other Person; or

            (xi) any exchange, release or nonperfection, or lapse of perfection,
      of any security for any  Guaranteed  Obligation  or the  acceptance of any
      security therefor; or


                                      -3-


            (xii)  any   bankruptcy,   insolvency,   winding  up,   dissolution,
      liquidation,  receivership,  or reorganization of, or similar  proceedings
      affecting,  the Company or the  Guarantor  or its assets or any  resulting
      release or discharge of any of the Guaranteed  Obligations  (except to the
      extent resulting from performance thereof); or

            (xiii) any regulatory change or other  governmental  action (whether
      or not adverse); or

            (xiv)  any  partial   payment  or   performance  of  the  Guaranteed
      Obligations  (whether as a result of the  exercise  of any right,  remedy,
      power or privilege  or  otherwise)  that is accepted or received  (except,
      subject to paragraph  (f) of this Section 2, to the extent of such payment
      or performance); or

            (xv)  any  other  occurrence  or  circumstance  whatsoever,  whether
      similar or dissimilar to the foregoing,  whether or not foreseeable,  that
      might  otherwise  constitute a legal or equitable  defense or discharge of
      the  liabilities  of a guarantor or surety or that might  otherwise  limit
      recourse against the Guarantor.

            The  obligations  of the Guarantor set forth herein  constitute  the
full recourse  obligations of the Guarantor  enforceable  against it to the full
extent of all its assets and properties.

            (d) The  obligation and liability of the Guarantor  hereunder  shall
not be impaired,  diminished,  abated or otherwise  affected (i) by any set-off,
defense or counterclaim that the Company,  the Guarantor or any other Person may
have  or  claim  to  have,  at any  time or from  time to  time,  or (ii) by the
commencement by or against the Company, the Guarantor or any other Person of any
proceedings  under any  bankruptcy  or  insolvency  law or laws  relating to the
relief of debtors, readjustment of indebtedness, reorganizations,  arrangements,
compositions or extension or other similar laws.

            (e) It is the intent and purpose hereof that the Guarantor shall not
be  entitled to and does  hereby  waive,  to the  fullest  extent  permitted  by
applicable law, any and all defenses available to guarantors, sureties and other
secondary  parties at law or in equity.  Without  limiting the generality of the
foregoing, the Guarantor hereby waives notice of acceptance of this Guaranty and
of the nonperformance by the Company, diligence, presentment, protest, dishonor,
demand for payment from the Company or any other Person and notice of nonpayment
or  failure  to  perform  on the  part  of the  Company  and all  other  notices
whatsoever.  The guaranty  hereunder is a guaranty of payment,  performance  and
compliance and not of  collectability  only. The Guarantor  specifically  agrees
that it shall not be necessary,  and the Guarantor shall not require,  before or
as a condition of enforcing the  liability of the Guarantor  under this Guaranty
or  requiring  payment  or  performance  of the  Guaranteed  Obligations  by the
Guarantor  hereunder,  or at any time  thereafter,  that  any of the  Guaranteed
Beneficiaries  (i) file suit or proceed to obtain or assert a claim for personal
judgment  against any Person that may be liable for any  Guaranteed  Obligation;
(ii) make any other effort to obtain  payment or  performance  of any Guaranteed
Obligation  from the  Company  or any other  Person  that may be liable for such
Guaranteed  Obligation;  (iii)  foreclose  against or seek to  realize  upon any
security now or hereafter existing for such Guaranteed Obligation; (iv) exercise
or assert any other right or remedy to which any of the Guaranteed Beneficiaries
is or may be  entitled  in  connection  with any  Guaranteed  Obligation  or any
security or other guaranty therefor; (v) assert or


                                      -4-


file any claim  against the assets of the Company or any other Person liable for
any  Guaranteed  Obligation;  or (vi) join the Company or any other  Person as a
party to any proceeding  for the  enforcement of any provision of this Guaranty.
Without  limiting the foregoing,  it is understood  that repeated and successive
demands may be made and recoveries  may be had hereunder as and when,  from time
to  time,  a Event  of  Default  shall  have  occurred  and be  continuing  or a
Guaranteed  Obligation  shall  otherwise  arise (in  either  case,  a  "RECOVERY
EVENT"), and that,  notwithstanding  recovery hereunder for or in respect of any
such Recovery  Event,  this Guaranty  shall remain in force and effect and shall
apply to each and every subsequent  Recovery Event. The Guarantor further agrees
that,  without  limiting the generality of this Guaranty,  if any Recovery Event
shall have occurred and be continuing  and any  Guaranteed  Beneficiary  (or any
assignee  thereof) is prevented by applicable  law from  exercising its remedies
under any applicable Loan Document for any reason,  such Guaranteed  Beneficiary
(or any  assignee  thereof)  shall be  entitled  to receive  hereunder  from the
Guarantor,  upon demand  therefor,  the sums that otherwise  would have been due
from the Company had such remedies been  exercised.  If the Guarantor  makes any
payment  or  performs  any  obligation  hereunder  in  respect  of  any  of  the
obligations  to  be  performed  by  the  Company,  the  Guarantor  shall  become
subrogated  to the extent of such  payment or  performance  to the rights of the
Guaranteed  Beneficiary  under the relevant  agreement to which the Company is a
party  against the  Company in respect of such  obligations  and any  collateral
security or guaranty held by or for the benefit of such  Guaranteed  Beneficiary
for the  payment of such  obligations;  PROVIDED,  HOWEVER,  that such rights of
subrogation  shall not commence until such time as the Company or the Guarantor,
as the case may be,  shall  have paid and  performed  each and every  Guaranteed
Obligation to each  Guaranteed  Beneficiary  and the Guarantor  shall have fully
performed its obligations hereunder.

            (f) The guaranty  hereunder  shall not be deemed to have  terminated
and shall  continue to be effective  (or if  terminated  for any reason shall be
reinstated, as the case may be), if at any time payment, or any part thereof, of
any of the  obligations  hereunder or under any Loan  Document is rescinded  and
must be (and actually is) returned by any  Guaranteed  Beneficiary to the Person
who  made  the  payment  or on  behalf  of whom the  payment  was made  upon the
insolvency,  bankruptcy or reorganization (or similar event) with respect to the
Company,  the  Guarantor or  otherwise,  all as though such payment had not been
made.

            (g) If the Guarantor  fails to pay any amount  hereunder when due to
any  Guaranteed  Beneficiary,   the  Guarantor  shall  pay  to  such  Guaranteed
Beneficiary  interest,  on  demand,  on  such  amount  at the  appropriate  rate
described in Section 2.2E of the Credit Agreement.

            (h)  The  Guarantor   further  agrees  to  pay  to  each  Guaranteed
Beneficiary  any and all costs and  expenses,  including  reasonable  legal fees
(which shall include  allocated  costs of internal  counsel) and  disbursements,
incurred  by such party in  connection  with  enforcing  its  rights  under this
Guaranty.


                                      -5-


            SECTION 3. COVENANTS OF GUARANTOR.  The Guarantor  hereby  covenants
for the benefit of each Guaranteed Beneficiary as follows:

            (a) NO  ASSIGNMENT  BY  GUARANTOR.  Except  as  expressly  permitted
herein,  the  Guarantor  agrees  that it shall not  assign  any of its rights or
obligations  hereunder  without the prior written consent of the Agent,  and the
Requisite Lenders.

            (b) DEFAULT UNDER LOAN DOCUMENTS. The Guarantor agrees that it shall
not take any action or fail to take any  action  that  would  cause a  Potential
Event of Default or Event of Default under any of the other Loan Documents.

            SECTION  4.   REPRESENTATIONS  AND  WARRANTIES  OF  GUARANTOR.   The
Guarantor  makes,  for the benefit of each Guaranteed  Beneficiary,  each of the
representations  and warranties made in the Credit Agreement by the Guarantor as
to its assets,  financial  condition,  operations,  organization,  legal status,
business, and the Loan Documents to which it is a party.

            SECTION 5. MISCELLANEOUS.

            (a)  WAIVERS;   CUMULATIVE   EFFECT.  A  waiver  by  any  Guaranteed
Beneficiary  of any right or remedy  hereunder on any one occasion  shall not be
construed as a bar to any right or remedy that such  Guaranteed  Beneficiary (or
any  other  Guaranteed  Beneficiary)  would  otherwise  have  had on any  future
occasion with regard to any  subsequent  breach.  No failure to exercise nor any
delay in exercising on the part of any Guaranteed  Beneficiary any right, power,
or privilege hereunder,  shall operate as a waiver thereof; nor shall any single
or partial  exercise of any right,  power, or privilege  hereunder  preclude any
other or further exercise thereof or the exercise of any other right,  power, or
privilege.  The rights and remedies  herein  provided are  cumulative and may be
exercised  singularly or  concurrently,  and are not exclusive of any rights and
remedies provided by law or by the Credit Agreement or the other Loan Documents.

            (b)  AMENDMENTS;  WAIVERS.  This  Guaranty  may  not be  terminated,
amended,  supplemented,  waived,  or  modified  orally,  but may be  terminated,
amended, supplemented, waived, or modified upon the prior written consent of the
Guarantor, the Agent, and the Requisite Lenders.

            (c) SEVERABILITY.  Any provision of this Guaranty that is prohibited
or  unenforceable  in  any  jurisdiction  shall,  as to  such  jurisdiction,  be
ineffective  to the  extent  of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

            (d)  COUNTERPARTS.  This  Guaranty  may be  executed  by the parties
hereto in separate  counterparts,  each of which when so executed and  delivered
shall be an original,  but all such counterparts  shall together  constitute but
one and the same instrument.

            (e) NOTICES.  Any notice to the Guarantor  hereunder may be directed
to the  Guarantor at its address set forth in Annex A, or to such other  address
as the Guarantor may designate by notice given to the other parties hereto.


                                      -6-


            (f) HEADINGS, REFERENCES. The section and paragraph headings in this
Guaranty are for  convenience  of reference  only and shall not modify,  define,
expand or limit any of the terms or provisions hereof.

            (g) GOVERNING  LAW.  THIS GUARANTY  SHALL BE GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK, EXCLUDING (TO THE GREATEST EXTENT PERMISSIBLE BY LAW) ANY
RULE OF LAW THAT WOULD  CAUSE THE  APPLICATION  OF THE LAWS OF ANY  JURISDICTION
OTHER THAN THE STATE OF NEW YORK.  THIS GUARANTY HAS BEEN DELIVERED IN THE STATE
OF NEW YORK.

            (h) BENEFIT AND BINDING EFFECT.  The terms of this Guaranty shall be
binding  upon the  Guarantor,  and shall inure to the benefit of the  Guarantor,
each  Guaranteed  Beneficiary,  and their  respective  successors  and permitted
assigns (to the extent permitted hereunder and under the Loan Documents).

            (i) SERVICE OF PROCESS;  JURISDICTION AND WAIVER.  The Guarantor (A)
hereby irrevocably  submits to the nonexclusive  jurisdiction of (i) the Supreme
Court of the State of New York, New York County (without  prejudice to the right
of any party to remove to the  United  States  District  Court for the  Southern
District of New York) and (ii) the United States District Court for the Southern
District of New York for the purposes of any suit,  action,  or other proceeding
arising  out of this  Guaranty  or the  subject  matter  hereof  brought  by any
Guaranteed  Beneficiary  or its  successors  or  permitted  assigns,  (B) hereby
irrevocably agrees that all claims in respect of such suit, action or proceeding
may be heard and  determined  in such New York  State  court or, to the  fullest
extent permitted by applicable law, in such Federal court, and (C) to the extent
permitted  by  applicable  law,  hereby  irrevocably  waives,  and agrees not to
assert, by way of motion, as a defense, or otherwise,  in any such suit, action,
or proceeding any claim that it is not personally subject to the jurisdiction of
the above-named  courts,  that the suit,  action, or proceeding is brought in an
inconvenient  forum,  that the  venue of the  suit,  action,  or  proceeding  is
improper, or that this Guaranty or the subject matter hereof may not be enforced
in or by such court.  THE  GUARANTOR  WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY
SUIT,  ACTION,  PROCEEDING,  OR COUNTERCLAIM  ARISING OUT OF OR RELATING TO THIS
GUARANTY.  A  final  judgment  obtained  in  respect  of any  suit,  action,  or
proceeding  referred  to in this  Section  5(i) shall be  conclusive  and may be
enforced  in other  jurisdictions  by suit on the  judgment  or in any manner as
provided by applicable law. The Guarantor  hereby consents to service of process
in connection  with the subject  matter  specified in the first sentence of this
Section 5(i) in connection with the above-  mentioned courts by registered mail,
FedEx,  DHL, or similar  courier at the address to which notices to it are to be
given as provided in Annex A hereto, it being agreed that service in such manner
shall constitute valid service upon the Guarantor and its successors and assigns
in connection with any such suit, action, or proceeding only; PROVIDED, HOWEVER,
that  nothing  in  this  Section  5(i)  shall  affect  the  right  of any of the
Guaranteed  Beneficiaries  or their successors or assigns to serve legal process
in any  other  matter  permitted  by  law  or  affect  the  right  of any of the
Guaranteed  Beneficiaries  or  their  successors  or  assigns to bring any suit,
action, or proceeding  against the Guarantor or its  properties in the courts of
other jurisdictions.


                                      -7-


            (j) SAVINGS.  Each Guaranteed  Beneficiary (by its acceptance of the
benefits hereof) and the Guarantor hereby confirms that it is its intention that
this Guaranty not constitute a fraudulent transfer or conveyance for purposes of
the Bankruptcy Code, the Uniform Fraudulent  Transfer Act or any similar federal
or state law. To effectuate the foregoing intention, each Guaranteed Beneficiary
and the Guarantor  hereby  irrevocably  agrees that the  Guaranteed  Obligations
guaranteed by the Guarantor  under this Guaranty shall be limited to such amount
as will,  after giving effect to such maximum amount and all of the  Guarantor's
other  (contingent or otherwise)  liabilities that  are relevant under such laws
(but  excluding,  to  the  maximum  extent  permitted  by  applicable  law,  any
liabilities of the Guarantor arising under any indebtedness that is subordinated
to the Guaranteed Obligations or any obligations under this Guaranty), result in
the  Guaranteed  Obligations  of the Guarantor in respect of such maximum amount
not constituting a fraudulent transfer or conveyance.

                                    * * * * *


                                      -8-


            IN WITNESS  WHEREOF,  the  Guarantor  has caused this Guaranty to be
executed  as of the day and year  first  written  above for the  benefit  of the
parties named herein.

                                           ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer



                                                                         ANNEX A

                        ADDRESS FOR NOTICES TO GUARANTOR

ATLAS AIR WORLDWIDE HOLDINGS, INC.

2000 Westchester Avenue
Purchase, New York 10577-2543

Attention: Treasurer/Corporate Finance


                                      (i)

EX-10.5.3

                                                                  EXHIBIT 10.5.3


                                                                  EXECUTION COPY

                              SUBSIDIARIES GUARANTY

================================================================================

                                    GUARANTY

                            Dated as of July 27, 2004

                                    given by

           CERTAIN SUBSIDIARIES OF ATLAS AIR WORLDWIDE HOLDINGS, INC.

================================================================================


                                TABLE OF CONTENTS
                                                                            PAGE
                                                                            ----

SECTION 1. GUARANTY .....................................................     1

SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY ..................     2

SECTION 3. COVENANTS OF THE GUARANTORS ..................................     5
      (a)   No Assignment by Guarantor ..................................     5
      (b)   Default Under Loan Documents ................................     6

SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE GUARANTORS .............     6

SECTION 5. MISCELLANEOUS ................................................     6
      (a)   Waivers; Cumulative Effect ..................................     6
      (b)   Amendments; Waivers .........................................     6
      (c)   Severability ................................................     6
      (d)   Counterparts ................................................     6
      (e)   Notices .....................................................     6
      (f)   Headings, References ........................................     7
      (g)   Governing Law ...............................................     7
      (h)   Benefit and Binding Effect ..................................     7
      (i)   Service of Process; Jurisdiction and Waiver .................     7
      (j)   Savings .....................................................     8

Annex A - Address for Notices to Guarantor

Schedule I - Description of Lease Agreement



                              SUBSIDIARIES GUARANTY

            SUBSIDIARIES  GUARANTY (this  "GUARANTY") dated as of July 27, 2004,
is  given  by  each of the  undersigned  subsidiaries  of  Atlas  Air  Worldwide
Holdings,  Inc. (each a "GUARANTOR" and collectively,  the  "GUARANTORS"),  with
respect  to each and  every  obligation  of the  Lessee  under the  Amended  and
Restated  Lease  Agreement,  dated as of July 27,  2004,  and more  particularly
described on Schedule I hereto (as amended,  modified or supplemented  from time
to time, the "Lease  Agreement") and the other Loan  Documents,  and is given to
and for the benefit of the Lessor, the Agent, and the Lenders (collectively, the
"GUARANTEED BENEFICIARIES" and individually,  a "GUARANTEED  BENEFICIARY").  All
capitalized terms used herein shall,  unless otherwise defined herein,  have the
respective meanings set forth in the Lease Agreement.

                              W I T N E S S E T H:

            WHEREAS,  it is a condition  precedent to the  effectiveness  of the
Lease  Agreement,  that each Guarantor  guarantee the  obligations of the Lessor
under  the  Lease  Agreement  and the  other  Loan  Documents  in  favor  of the
Guaranteed  Beneficiaries  and that  each  Guarantor  shall  have  executed  and
delivered to the Agent this Guaranty;

            WHEREAS,  each  Guarantor is entering into this Guaranty in order to
induce the Agent and each Lender to enter into the Credit Agreement;

            WHEREAS,  each Guarantor will obtain  benefits from Lessee  entering
into the Lease Agreement,  and accordingly,  desires to execute this Guaranty to
satisfy the conditions described in the preceding paragraph;

            NOW,  THEREFORE,  each Guarantor  hereby agrees on behalf of and for
the benefit of the Guaranteed Beneficiaries as follows:

            SECTION 1. GUARANTY.  Each Guarantor does hereby unconditionally and
irrevocably jointly and severally  guarantee,  as primary obligor and not merely
as surety, the following (such obligations being the "GUARANTEED OBLIGATIONS"):

            (a) to each  Guaranteed  Beneficiary,  the full and  prompt  payment
      when, where and as due, of each and every payment obligation of the Lessee
      to each such  Guaranteed  Beneficiary  under the Lease  Agreement and each
      other Loan Document, including, without limitation, Rent; and

            (b) to each Guaranteed  Beneficiary entitled thereto under the terms
      of any Loan Document,  the full and timely  performance  and observance by
      the Lessee of each and all other covenants and agreements not described in
      clause (a) above  required to be performed or observed by the Lessee under
      such Loan Document.

            Without  limiting the generality of the foregoing,  each Guarantor's
liability  hereunder shall extend to all obligations that constitute part of the
Guaranteed  Obligations and would be owed by the Lessee under the Loan Documents
but for the fact that they are



unenforceable or not allowable due to the existence of a bankruptcy,  suspension
of payments, reorganization or similar proceeding involving the Lessee.

             SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY

            (a) Each and every  default  in any  payment or  performance  of any
obligation  of the Lessee under any Loan Document to which the Lessee is a party
shall give rise to a separate claim and cause of action  hereunder to the extent
that each such  default  by the Lessee  would  give rise to a separate  claim or
cause of action under the applicable Loan Document, and separate claims or suits
may be made and  brought,  as the case may be,  hereunder  as each such  default
occurs.

            (b) This Guaranty shall be a continuing,  absolute,  irrevocable and
unconditional  guaranty of payment and  performance  and not of  collection  and
shall remain in full force and effect until each and all of the  obligations  of
the  Lessee  guaranteed   hereunder  shall  have  been  fully  and  indefeasibly
discharged or performed in accordance  with the terms and provisions of the Loan
Documents (and no longer subject to  recoupment,  preference  claims or clawback
under  applicable  bankruptcy,  insolvency or similar laws),  and each Guarantor
shall have fully  discharged  or  performed  all of its  obligations  under this
Guaranty to each Guaranteed Beneficiary.

            (c) This Guaranty and the liability of the  Guarantors  provided for
in Section 1 hereunder shall remain in full force and effect irrespective of:

            (i) the legality,  validity,  regularity or  enforceability,  or the
      absence  of any  thereof,  of any Loan  Document  (or  other  document  or
      agreement) or of any assignment,  amendment,  modification, or termination
      of any Loan Document (or other document or agreement) or any subleasing or
      further  subleasing  of the  Aircraft or Spare  Engines  (or any  interest
      therein or portion  thereof),  and shall in no way be affected or impaired
      by (and no notice to the  Guarantors  shall be required in respect of) any
      compromise, waiver, settlement,  release, renewal, extension,  indulgence,
      amendment,  addition, deletion, change or modification with respect to, or
      release of any security for any of the  obligations  or liabilities of the
      Lessee under,  any Loan Document or any  redelivery,  repossession,  sale,
      transfer or other disposition, surrender or destruction of, or other event
      or  circumstance  with respect to, the  Aircraft or Spare  Engines (or any
      interest therein or portion thereof), in whole or part; or

            (ii) the transfer,  assignment,  subletting,  or mortgaging,  or the
      purported transfer,  assignment,  subletting, or mortgaging, of all or any
      part of the interest of any  Guaranteed  Beneficiary  or the Lessee in the
      Aircraft or Spare Engines (or any interest  therein or portion thereof) in
      accordance with the Loan Documents; or

            (iii)  any  absence  or  defect  or  failure  of  title  or  lack of
      recordation or registration  with respect to any Guaranteed  Beneficiary's
      or the Lessee's interest in the Aircraft or Spare Engines (or any interest
      therein or portion thereof); or


                                      -2-



            (iv) any  failure  of  delivery  of,  or loss of  perfection  of any
      security  interest  with  respect to, any portion of the Aircraft or Spare
      Engines (or any interest therein or portion thereof); or

            (v) any matter relating to any agreement or approval (or the absence
      thereof) in connection with the Aircraft or Spare Engines (or any interest
      therein or portion thereof); or

            (vi) any failure,  neglect or omission on the part of any Guaranteed
      Beneficiary  or any  other  Person  to give the  Guarantors  notice of the
      occurrence of any Default or Lease Event of Default or Potential  Event of
      Default or Event of Default or to realize upon any collateral  held by any
      Guaranteed Beneficiary or any other Person with respect to any obligations
      or  liabilities  of the  Lessee,  or to provide for any  insurance  on the
      Aircraft or Spare Engines (or any interest therein or portion thereof), or
      to establish  or maintain a security or other  interest in the Aircraft or
      Spare  Engines  (or  any  interest  therein  or  portion  thereof)  or any
      collateral  provided  under any Loan  Document or to establish or maintain
      the priority or perfection of any thereof; or

            (vii) any defect in the compliance with  specifications,  warranties
      or any insurance policy or the condition, design, operation or fitness for
      use of, or any damage to or loss or destruction of, or any interruption or
      cessation  in the use of, the  Aircraft or Spare  Engines (or any interest
      therein or any portion  thereof) by the Lessee or any other Person for any
      reason  whatsoever  (including,   without  limitation,   any  governmental
      prohibition  or  restriction,  condemnation,  requisition,  seizure or any
      other act on the part of any  governmental or military  authority,  or any
      act of God or of the public  enemy)  regardless  of the  duration  thereof
      (even though such duration would otherwise  constitute a frustration under
      any Loan Document), whether or not without fault on the part of the Lessee
      or any other Person; or

            (viii)  any  merger,   consolidation   or  other   restructuring  or
      termination of the corporate structure, reorganization or transaction with
      respect to the Lessee or any  Guarantor  into,  with or in respect of, any
      other  Person or any sale,  lease,  assignment  or  transfer of any of the
      assets of the Lessee or any Guarantor to any other Person; or

            (ix) any disposition by any Guarantor of its interest in the Lessee,
      or any change in the  ownership  of any  shares of  capital  stock of such
      Guarantor or the Lessee,  or any change,  restructuring  or termination of
      the corporate structure or existence of the Lessee; or

            (x) the  imposition  of any Tax or other charge  against the Lessee,
      any Guarantor or any other Person; or

            (xi) any exchange, release or nonperfection, or lapse of perfection,
      of any security for any  Guaranteed  Obligation  or the  acceptance of any
      security therefore; or

            (xii)  any   bankruptcy,   insolvency,   winding  up,   dissolution,
      liquidation,  receivership,  or reorganization of, or similar  proceedings
      affecting,  the Lessee or any  Guarantor  or its  assets or any  resulting
      release or discharge of any of the Guaranteed  Obligations  (except to the
      extent resulting from performance thereof); or


                                      -3-



            (xiii) any regulatory change or other  governmental  action (whether
      or not adverse); or

            (xiv)  any  partial   payment  or   performance  of  the  Guaranteed
      Obligations  (whether as a result of the  exercise  of any right,  remedy,
      power or privilege  or  otherwise)  that is accepted or received  (except,
      subject to paragraph  (f) of this Section 2, to the extent of such payment
      or performance); or

            (xv)  any  other  occurrence  or  circumstance  whatsoever,  whether
      similar or dissimilar to the foregoing,  whether or not foreseeable,  that
      might  otherwise  constitute a legal or equitable  defense or discharge of
      the  liabilities  of a Guarantor or surety or that might  otherwise  limit
      recourse against such Guarantor.

            The  obligations of each  Guarantor set forth herein  constitute the
full recourse  obligations of each Guarantor  enforceable against it to the full
extent of all its assets and properties.

            (d) The obligation and liability of each Guarantor  hereunder  shall
not be impaired,  diminished,  abated or otherwise  affected (i) by any set-off,
defense or counterclaim  that the Lessee,  any Guarantor or any other Person may
have  or  claim  to  have,  at any  time or from  time to  time,  or (ii) by the
commencement by or against the Lessee,  any Guarantor or any other Person of any
proceedings  under any  bankruptcy  or  insolvency  law or laws  relating to the
relief of debtors, readjustment of indebtedness, reorganizations,  arrangements,
compositions or extension or other similar laws.

            (e) It is the intent and purpose  hereof that each  Guarantor  shall
not be entitled to and does hereby  waive,  to the fullest  extent  permitted by
applicable law, any and all defenses  available to such Guarantor,  sureties and
other secondary parties at law or in equity.  Without limiting the generality of
the  foregoing,  each  Guarantor  hereby  waives  notice of  acceptance  of this
Guaranty  and  of the  nonperformance  by the  Lessee,  diligence,  presentment,
protest,  dishonor,  demand for payment  from the Lessee or any other Person and
notice of  nonpayment  or  failure  to perform on the part of the Lessee and all
other  notices  whatsoever.  The  guaranty  hereunder  is a guaranty of payment,
performance  and  compliance  and not of  collectability  only.  Each  Guarantor
specifically agrees that it shall not be necessary, and such Guarantor shall not
require,  before or as a condition of enforcing the liability of such  Guarantor
under this  Guaranty  or  requiring  payment or  performance  of the  Guaranteed
Obligations by such Guarantor hereunder, or at any time thereafter,  that any of
the  Guaranteed  Beneficiaries  (i) file suit or  proceed  to obtain or assert a
claim for  personal  judgment  against  any  Person  that may be liable  for any
Guaranteed  Obligation;  (ii)  make  any  other  effort  to  obtain  payment  or
performance  of any  Guaranteed  Obligation  from the Lessee or any other Person
that may be liable for such Guaranteed  Obligation;  (iii) foreclose  against or
seek to realize upon any security now or hereafter  existing for such Guaranteed
Obligation;  (iv)  exercise  or assert any other right or remedy to which any of
the  Guaranteed  Beneficiaries  is or may be  entitled  in  connection  with any
Guaranteed Obligation or any security or other guaranty therefore; (v) assert or
file any claim  against the assets of the Lessee or any other Person  liable for
any  Guaranteed  Obligation;  or (vi) join the  Lessee or any other  Person as a
party to any proceeding  for the  enforcement of any provision of this Guaranty.
Without  limiting the foregoing,  it is understood  that repeated and successive
demands may be made and recoveries  may be had hereunder as and when,  from time
to time, a Lease Event of Default shall have occurred and


                                      -4-



be continuing or a Guaranteed  Obligation shall otherwise arise (in either case,
a "RECOVERY  EVENT"),  and that,  notwithstanding  recovery  hereunder for or in
respect of any such  Recovery  Event,  this  Guaranty  shall remain in force and
effect  and  shall  apply to each and  every  subsequent  Recovery  Event.  Each
Guarantor further agrees that, without limiting the generality of this Guaranty,
if any Recovery  Event shall have occurred and be continuing  and any Guaranteed
Beneficiary  (or any  assignee  thereof) is  prevented  by  applicable  law from
exercising its remedies under any applicable Loan Document for any reason,  such
Guaranteed  Beneficiary  (or any assignee  thereof) shall be entitled to receive
hereunder from such  Guarantor,  upon demand  therefor,  the sums that otherwise
would have been due from the Lessee had such  remedies  been  exercised.  If any
Guarantor  makes any payment or performs any obligation  hereunder in respect of
any of the  obligations  to be performed  by the Lessee,  such  Guarantor  shall
become  subrogated to the extent of such payment or performance to the rights of
the Guaranteed Beneficiary under the relevant agreement to which the Lessee is a
party  against  the  Lessee in respect of such  obligations  and any  collateral
security or guaranty held by or for the benefit of such  Guaranteed  Beneficiary
for the  payment of such  obligations;  PROVIDED,  HOWEVER,  that such rights of
subrogation shall not commence until such time subsequent to the end of the Term
as the  Lessee  or such  Guarantor,  as the case  may be,  shall  have  paid and
performed each and every  Guaranteed  Obligation to each Guaranteed  Beneficiary
and such Guarantor shall have fully performed its obligations hereunder.

            (f) The guaranty  hereunder  shall not be deemed to have  terminated
and shall  continue to be effective  (or if  terminated  for any reason shall be
reinstated, as the case may be), if at any time payment, or any part thereof, of
any of the  obligations  hereunder or under any Loan  Document is rescinded  and
must be (and actually is) returned by any  Guaranteed  Beneficiary to the Person
who  made  the  payment  or on  behalf  of whom the  payment  was made  upon the
insolvency,  bankruptcy or reorganization (or similar event) with respect to the
Lessee,  any  Guarantor  or  otherwise,  all as though such payment had not been
made.

            (g) If any Guarantor  fails to pay any amount  hereunder when due to
any  Guaranteed  Beneficiary,  such  Guarantor  shall  pay  to  such  Guaranteed
Beneficiary  interest,  on  demand,  on  such  amount  at the  appropriate  rate
described in Section 2.2D of the Credit Agreement.

            (h)  Each  Guarantor  further  agrees  to  pay  to  each  Guaranteed
Beneficiary  any and all costs and  expenses,  including  reasonable  legal fees
(which shall include  allocated  costs of internal  counsel) and  disbursements,
incurred  by such party in  connection  with  enforcing  its  rights  under this
Guaranty.

            SECTION  3.  COVENANTS  OF THE  GUARANTORS.  Each  Guarantor  hereby
covenants for the benefit of each Guaranteed Beneficiary as follows:

            (a) NO  ASSIGNMENT  BY  GUARANTOR.  Except  as  expressly  permitted
herein,  each  Guarantor  agrees  that it shall not  assign any of its rights or
obligations  hereunder  without the prior  written  consent of the  Lessor,  the
Agent, and the Requisite  Lenders.  Each Guarantor  acknowledges that the Lessor
intends to mortgage,  grant,  and assign all of the Lessor's right,  title,  and
interest in and to this Guaranty and such Guarantor's  obligations  hereunder to
the Agent, as administrative  agent for and  representative  of the Lenders,  as
security for the Secured


                                      -5-



Obligations (as defined in the relevant  Aircraft  Chattel  Mortgage),  and each
Guarantor hereby consents to such mortgage, grant, and assignment.

            (b) DEFAULT  UNDER LOAN  DOCUMENTS.  Each  Guarantor  agrees that it
shall not take any action or fail to take any action  that would cause a Default
or Lease  Event of Default  under any Lease or a  Potential  Event of Default or
Event of Default under any of the other Loan Documents.

            SECTION 4.  REPRESENTATIONS  AND WARRANTIES OF THE GUARANTORS.  Each
Guarantor  makes,  for the benefit of each Guaranteed  Beneficiary,  each of the
representations  and warranties made in the Lease Agreement by each Guarantor as
to its assets,  financial  condition,  operations,  organization,  legal status,
business, and the Loan Documents to which it is a party.

            SECTION 5. MISCELLANEOUS.

            (a)  WAIVERS;   CUMULATIVE   EFFECT.  A  waiver  by  any  Guaranteed
Beneficiary  of any right or remedy  hereunder on any one occasion  shall not be
construed as a bar to any right or remedy that such  Guaranteed  Beneficiary (or
any  other  Guaranteed  Beneficiary)  would  otherwise  have  had on any  future
occasion with regard to any  subsequent  breach.  No failure to exercise nor any
delay in exercising on the part of any Guaranteed  Beneficiary any right, power,
or privilege hereunder,  shall operate as a waiver thereof; nor shall any single
or partial  exercise of any right,  power, or privilege  hereunder  preclude any
other or further exercise thereof or the exercise of any other right,  power, or
privilege.  The rights and remedies  herein  provided are  cumulative and may be
exercised  singularly or  concurrently,  and are not exclusive of any rights and
remedies provided by law or by the Lease Agreement or the other Loan Documents.

            (b)  AMENDMENTS;  WAIVERS.  This  Guaranty  may  not be  terminated,
amended,  supplemented,  waived,  or  modified  orally,  but may be  terminated,
amended,  supplemented,  waived,  or modified upon the prior written  consent of
each Guarantor, the Lessor, the Agent, and the Requisite Lenders.

            (c) SEVERABILITY.  Any provision of this Guaranty that is prohibited
or  unenforceable  in  any  jurisdiction  shall,  as to  such  jurisdiction,  be
ineffective  to the  extent  of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

            (d)  COUNTERPARTS.  This  Guaranty  may be  executed  by the parties
hereto in separate  counterparts,  each of which when so executed and  delivered
shall be an original,  but all such counterparts  shall together  constitute but
one and the same instrument.

            (e) NOTICES.  Any notice to the Guarantors hereunder may be directed
to each  Guarantor at its address set forth in Annex A, or to such other address
as each Guarantor may designate by notice given to the other parties hereto.


                                      -6-



            (f) HEADINGS, REFERENCES. The section and paragraph headings in this
Guaranty are for  convenience  of reference  only and shall not modify,  define,
expand or limit any of the terms or provisions hereof.

            (g) GOVERNING  LAW.  THIS GUARANTY  SHALL BE GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK, EXCLUDING (TO THE GREATEST EXTENT PERMISSIBLE BY LAW) ANY
RULE OF LAW THAT WOULD  CAUSE THE  APPLICATION  OF THE LAWS OF ANY  JURISDICTION
OTHER THAN THE STATE OF NEW YORK.  THIS GUARANTY HAS BEEN DELIVERED IN THE STATE
OF NEW YORK.

            (h) BENEFIT AND BINDING EFFECT.  The terms of this Guaranty shall be
binding upon each  Guarantor,  and shall inure to the benefit of each Guarantor,
each  Guaranteed  Beneficiary,  and their  respective  successors  and permitted
assigns (to the extent permitted hereunder and under the Loan Documents).

            (i) SERVICE OF PROCESS;  JURISDICTION AND WAIVER. Each Guarantor (A)
hereby irrevocably  submits to the nonexclusive  jurisdiction of (i) the Supreme
Court of the State of New York, New York County (without  prejudice to the right
of any party to remove to the  United  States  District  Court for the  Southern
District of New York) and (ii) the United States District Court for the Southern
District of New York for the purposes of any suit,  action,  or other proceeding
arising  out of this  Guaranty  or the  subject  matter  hereof  brought  by any
Guaranteed  Beneficiary  or its  successors  or  permitted  assigns,  (B) hereby
irrevocably agrees that all claims in respect of such suit, action or proceeding
may be heard and  determined  in such New York  State  court or, to the  fullest
extent permitted by applicable law, in such Federal court, and (C) to the extent
permitted  by  applicable  law,  hereby  irrevocably  waives,  and agrees not to
assert, by way of motion, as a defense, or otherwise,  in any such suit, action,
or proceeding any claim that it is not personally subject to the jurisdiction of
the above-named  courts,  that the suit,  action, or proceeding is brought in an
inconvenient  forum,  that the  venue of the  suit,  action,  or  proceeding  is
improper, or that this Guaranty or the subject matter hereof may not be enforced
in or by such court.  EACH GUARANTOR  WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY
SUIT,  ACTION,  PROCEEDING,  OR COUNTERCLAIM  ARISING OUT OF OR RELATING TO THIS
GUARANTY.  A  final  judgment  obtained  in  respect  of any  suit,  action,  or
proceeding  referred  to in this  Section  5(i) shall be  conclusive  and may be
enforced  in other  jurisdictions  by suit on the  judgment  or in any manner as
provided by applicable law. Each Guarantor hereby consents to service of process
in connection  with the subject  matter  specified in the first sentence of this
Section 5(i) in connection with the  above-mentioned  courts by registered mail,
FedEx,  DHL, or similar  courier at the address to which notices to it are to be
given as provided in Annex A hereto, it being agreed that service in such manner
shall  constitute  valid  service upon such  Guarantor  and its  successors  and
assigns in connection with any such suit, action, or proceeding only;  PROVIDED,
HOWEVER,  that nothing in this Section 5(i) shall affect the right of any of the
Guaranteed  Beneficiaries  or their successors or assigns to serve legal process
in any  other  matter  permitted  by  law  or  affect  the  right  of any of the
Guaranteed  Beneficiaries  or their  successors  or  assigns  to bring any suit,
action, or proceeding  against such Guarantor or its properties in the courts of
other jurisdictions.


                                      -7-



            (j) SAVINGS.  Each Guaranteed  Beneficiary (by its acceptance of the
benefits  hereof) and each  Guarantor  hereby  confirms that it is its intention
that this  Guaranty  not  constitute  a fraudulent  transfer or  conveyance  for
purposes of the  Bankruptcy  Code,  the Uniform  Fraudulent  Transfer Act or any
similar  federal or state law.  To  effectuate  the  foregoing  intention,  each
Guaranteed  Beneficiary and each Guarantor  hereby  irrevocably  agrees that the
Guaranteed Obligations guaranteed by each Guarantor under this Guaranty shall be
limited to such amount as will,  after giving effect to such maximum  amount and
all of such  Guarantor's  other  (contingent or otherwise)  liabilities that are
relevant  under such laws (but  excluding,  to the maximum  extent  permitted by
applicable  law, any liabilities of a Guarantor  arising under any  indebtedness
that is subordinated to the Guaranteed Obligations or any obligations under this
Guaranty),  result in the Guaranteed Obligations of such Guarantor in respect of
such maximum amount not constituting a fraudulent transfer or conveyance.

                                    * * * * *


                                      -8-



            IN WITNESS  WHEREOF,  each  Guarantor has caused this Guaranty to be
executed  as of the day and year  first  written  above for the  benefit  of the
parties named herein.

                                               POLAR AIR CARGO, INC.


                                               By: /s/ William C. Bradley
                                                   -----------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer

                                               AIRLINE ACQUISITION CORP. I


                                               By: /s/ William C. Bradley
                                                   -----------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer



                                                                         ANNEX A

                      ADDRESS FOR NOTICES TO THE GUARANTORS

POLAR AIR CARGO, INC.

c/o Atlas Air Worldwide Holdings, Inc.
2000 Westchester Avenue
Purchase, New York 10577-2543

Attention: Treasurer/Corporate Finance

AIRLINE ACQUISITION CORP I

c/o Atlas Air Worldwide Holdings, Inc.
2000 Westchester Avenue
Purchase, New York 10577-2543

Attention: Treasurer/Corporate Finance



                                                                      SCHEDULE I

            Lease Agreement, dated as of April 25, 2000 and amended and restated
as of July 27, 2004, between the Lessor and the Lessee, as supplemented by Lease
Supplement No. 1, dated as of July 27, 2004, which were recorded together as one
instrument by the Federal Aviation  Administration (the "FAA") on July 27, 2004,
as Conveyance No. [___________].


                                      (i)

EX-10.5.4

                                                                  EXHIBIT 10.5.4

                                                                  EXECUTION COPY

           AMENDMENT NO. 3 TO SECURITY AGREEMENT AND CHATTEL MORTGAGE
                            (AIRCRAFT NO. N355MC)(1)

            THIS THIRD  AMENDMENT TO THE FIRST  SECURITY  AGREEMENT  AND CHATTEL
MORTGAGE is dated as of July 27, 2004, (this  "AMENDMENT"),  and entered into by
and between Atlas Air, Inc., a Delaware  corporation  ("COMPANY"),  and Deutsche
Bank Trust Company Americas, as agent for and representative of ("ADMINISTRATIVE
AGENT") the financial  institutions  ("LENDERS")  party to the Fifth Amended and
Restated Credit Agreement referred to below.

                              W I T N E S S E T H:

            WHEREAS,  Company  is  party  to that  certain  Fourth  Amended  and
Restated  Credit  Agreement,  dated as of April 25,  2000,  among  Company,  the
Lenders  from  time to time  party  thereto  and the  Administrative  Agent  (as
amended,  modified and/or  supplemented to, but not including,  the date hereof,
the "CREDIT AGREEMENT").

            WHEREAS,  pursuant to that certain Fifth Amended and Restated Credit
Agreement,  dated as of July 27, 2004,  among Company,  the Lenders from time to
time party thereto and the  Administrative  Agent (as amended,  modified  and/or
supplemented  from  time  to  time,  the  "FIFTH  AMENDED  AND  RESTATED  CREDIT
AGREEMENT"),  Company  has  agreed to  further  amend  and  restate  the  Credit
Agreement.

            WHEREAS,  Company and the  Administrative  Agent are parties to that
certain First Security Agreement and Chattel Mortgage with respect to one Boeing
747-341, U.S. Registration No. N355MC, Manufacturer"s Serial Number 23395, dated
May 18, 2000,  between Atlas Air, Inc. as debtor and Deutsche Bank Trust Company
Americas (formerly Bankers Trust Company) as Agent for and Representative of the
Lenders referred to therein,  recorded by the Federal Aviation Administration on
July 5, 2000,  as Conveyance  No.  XX015579,  amended by the First  Amendment to
First Security  Agreement and Chattel Mortgage  (Aircraft No. 23395) dated as of
May 1, 2002,  recorded May 29, 2002, as Conveyance No. M000709,  further amended
by the  Second  Amendment  to First  Security  Agreement  and  Chattel  Mortgage
(Aircraft  No.  N355MC)  dated as of April 30, 2004,  recorded May 27, 2004,  as
Conveyance No. MM026454 (the "AIRCRAFT CHATTEL MORTGAGE").

- ----------
(1) This Amendment to the First Security Agreement and Chattel Mortgage has been
executed in several counterparts.  To the extent, if any, that this Amendment to
the First Security Agreement and Chattel Mortgage  constitutes chattel paper (as
such  term  is  defined  in the  Uniform  Commercial  Code as in  effect  in any
applicable  jurisdiction),  no security  interest in this Amendment to the First
Security  Agreement and Chattel  Mortgage may be created through the transfer or
possession of any  counterpart  other than the original.  The  counterpart to be
deemed the original shall be the counterpart  that contains the receipt therefor
executed by Deutsche Bank Trust Company Americas,  as  Administrative  Agent, on
the  signature  page thereof and no security  interest in this  Amendment to the
First  Security  Agreement  and  Chattel  Mortgage  may be created  through  the
transfer of any counterpart other than said original counterpart.



            WHEREAS,  subject to the terms and conditions  set forth below,  the
parties hereto wish to amend certain provisions of the Aircraft Chattel Mortgage
as provided herein.

            NOW THEREFORE, it is agreed:

      1. The  Aircraft  Chattel  Mortgage is hereby  amended,  by  deleting  all
references to the term "Credit  Agreement" and inserting the term "Fifth Amended
and Restated Credit Agreement" in lieu thereof.

      2. Section 1(a)(iii) of the Aircraft Chattel Mortgage is hereby deleted in
its entirety and the following is inserted in its place:

      "(iii) all appliances,  parts,  instruments,  appurtenances,  accessories,
furnishings and other equipment of whatever nature (other than complete  Engines
or  engines),  that may from time to time be  incorporated  or  installed  in or
attached to the Airframe or any Engine, together with (i) all appliances, parts,
instruments, appurtenances,  accessories, furnishings, other equipment purchased
or owned by the Borrower and identified for  incorporation or installation in or
attachment to the Airframe or any Engine  pursuant to the terms of any agreement
whether  or not  identified  in a  Supplemental  Chattel  Mortgage  and (ii) all
appliances,  parts,  instruments,  appurtenances,  accessories,  furnishings and
other equipment of whatever  nature removed from the Airframe or any Engine,  no
matter where located, until such time as it shall be replaced on the Airframe or
any  Engine  by  an  appliance,  part,  instrument,   appurtenance,   accessory,
furnishing or other equipment in as good operating condition as and with a value
and  utility  at  least  equal  to  the  item  removed.  Immediately  upon  such
replacement,   such  replacement  appliance,  part,  instrument,   appurtenance,
accessory,  furnishing or other  equipment  shall become subject to the lien and
security  interest of this  Mortgage and shall be deemed part of the Airframe or
such  Engine  for  all  purposes  hereof  to the  same  extent  as the  property
originally comprising or installed on the Airframe or any Engine and the removed
item  shall no longer  be  subject  to the lien and  security  interest  of this
Mortgage (collectively referred to herein as "PARTS"); and"

      3. Section 1(b) of the Aircraft  Chattel Mortgage is hereby amended (x) by
deleting  the text "and" from the end of clause  (xii) of section  1(b),  (y) by
renumbering  clause (xiii) of Section 1(b) as clause (xvi), and (z) by inserting
the following new clauses:

      "(xiii) the Holdings  Guaranty,  including without limitation all payments
of any kind  thereunder,  and  including  all rights of Company,  as  guaranteed
beneficiary,  to execute any election or option or to give any notice,  consent,
waiver or approval under or in respect of the Holdings Guaranty,  as well as any
rights,  powers or remedies on the part of Company,  whether  arising  under the
Holdings  Guaranty or by statute or at law or in equity,  or otherwise,  arising
out of any Event of Default or out of any breach of the Holdings Guaranty;

      (xiv) the Subsidiaries Guaranty, including without limitation all payments
of any kind  thereunder,  and  including  all rights of Company,  as  guaranteed
beneficiary,  to execute any election or option or to give any notice,  consent,
waiver or approval under or in respect of the Subsidiaries  Guaranty, as well as
any rights, powers or remedies on the part of Company, whether arising under the
Subsidiaries  Guaranty  or by  statute  or at law or in  equity,  or  otherwise,
arising  out of any Event of Default  or out of any  breach of the  Subsidiaries
Guaranty; and"



      (xv) that certain  intercompany  claim owed by Polar Air to Company in the
amount  of not less  than  $5,285,660  in  unpaid  basic  rent  and  maintenance
reserves, plus an undetermined amount of other unpaid supplemental rent, in each
case under the Polar Air Lease (the  "INTERCOMPANY  CLAIM"),  which Intercompany
Claim survives the effective date of the Plan of Reorganization  pursuant to the
terms thereof; and"

      4.  Section  2 of the  Aircraft  Chattel  Mortgage  is hereby  amended  by
inserting the following new defined term in the appropriate  alphabetical order:

      "FIFTH AMENDED AND RESTATED CREDIT AGREEMENT" shall mean the Fifth Amended
and Restated Credit  Agreement,  dated as of July 27, 2004,  among Company,  the
lenders  from time to time  party  thereto,  and the  Administrative  Agent,  as
amended, modified or supplemented from time to time.

      5.  Section  4 of the  Aircraft  Chattel  Mortgage  is hereby  amended  by
inserting the following section after Section (j):

      "(k) INTERCOMPANY CLAIM. Upon the occurrence and during the continuance of
an Event  of  Default,  Company  will  cause  all  payments  in  respect  of the
Intercompany  Claim  to  be  made  directly  to  the  Administrative  Agent  for
application  as set  forth in  Section  2.4B(iii)(b)  of the Fifth  Amended  and
Restated Credit Agreement."

      6. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  (including  by way of  facsimile  or  electronic
transmission)  shall be an original,  but all of which shall together constitute
one and the same instrument. A complete set of counterparts shall be lodged with
Company and the Administrative Agent.

      7. This  Amendment  is limited as  specified  and shall not  constitute  a
modification,  acceptance  or  waiver  of any other  provision  of the  Aircraft
Chattel Mortgage.

      8. From and after the date hereof,  all references in the Aircraft Chattel
Mortgage to the Aircraft  Chattel  Mortgage  shall be deemed to be references to
Aircraft Chattel Mortgage as modified hereby.

                                      * * *



            IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  their duly
authorized  officers to execute and deliver this  Amendment as of the date first
above written.

                                        ATLAS AIR, INC.


                                        By: /s/ William C. Bradley
                                            ---------------------------------
                                            Name: William C. Bradley
                                            Title: Vice President & Treasurer

                                                  Security Agreement and Chattel
                                        Mortgage Amendment to the First Security
                                                  Agreement and Chattel Mortgage
                                                           (Aircraft No. N355MC)



                                        DEUTSCHE BANK TRUST COMPANY
                                        AMERICAS,

                                        as Administrative Agent


                                        By: /s/ Keith C. Braun
                                            ---------------------------------
                                            Name: Keith C. Braun
                                            Title: Director

                                                  Security Agreement and Chattel
                                        Mortgage Amendment to the First Security
                                                  Agreement and Chattel Mortgage
                                                           (Aircraft No. N355MC)

EX-10.5.5

                                                                  EXHIBIT 10.5.5

                                                                  EXECUTION COPY

           AMENDMENT NO. 3 TO SECURITY AGREEMENT AND CHATTEL MORTGAGE
                            (AIRCRAFT NO. N355MC)(1)

            THIS THIRD  AMENDMENT TO THE SECOND  SECURITY  AGREEMENT AND CHATTEL
MORTGAGE is dated as of July 27, 2004, (this  "AMENDMENT"),  and entered into by
and between Atlas Air, Inc., a Delaware  corporation  ("COMPANY"),  and Deutsche
Bank Trust Company Americas, as agent for and representative of ("ADMINISTRATIVE
AGENT") the financial  institutions  ("LENDERS")  party to the Fifth Amended and
Restated Credit Agreement referred to below.

                              W I T N E S S E T H:

            WHEREAS,  Company  is  party  to that  certain  Fourth  Amended  and
Restated  Credit  Agreement,  dated as of April 25,  2000,  among  Company,  the
Lenders  from  time to time  party  thereto  and the  Administrative  Agent  (as
amended,  modified and/or  supplemented to, but not including,  the date hereof,
the "CREDIT AGREEMENT").

            WHEREAS,  pursuant to that certain Fifth Amended and Restated Credit
Agreement,  dated as of July 27, 2004,  among Company,  the Lenders from time to
time party thereto and the  Administrative  Agent (as amended,  modified  and/or
supplemented  from  time  to  time,  the  "FIFTH  AMENDED  AND  RESTATED  CREDIT
AGREEMENT"),  Company  has  agreed to  further  amend  and  restate  the  Credit
Agreement.

            WHEREAS,  Company and the  Administrative  Agent are parties to that
certain  Second  Security  Agreement  and Chattel  Mortgage  with respect to one
Boeing  747-341,  U.S.  Registration  No. N355MC,  Manufacturer"s  Serial Number
23395,  dated May 18, 2000,  between Atlas Air, Inc. as debtor and Deutsche Bank
Trust  Company  Americas  (formerly  Bankers  Trust  Company)  as Agent  for and
Representative  of the  Lenders  referred  to  therein,  recorded by the Federal
Aviation Administration on July 5, 2000, as Conveyance No. XX015580,  amended by
the First Amendment to Second Security  Agreement and Chattel Mortgage (Aircraft
No. 23395) dated as of May 1, 2002,  recorded  June 14, 2002, as Conveyance  No.
M000794,  further amended by the Second  Amendment to Second Security  Agreement
and Chattel Mortgage (Aircraft No. N355MC) dated as of April 30, 2004,  recorded
May 27, 2004, as Conveyance No. MM026455 (the "AIRCRAFT CHATTEL MORTGAGE").

- ----------
(1) This  Amendment to the Second  Security  Agreement and Chattel  Mortgage has
been  executed  in  several  counterparts.  To the  extent,  if any,  that  this
Amendment to the Second  Security  Agreement  and Chattel  Mortgage  constitutes
chattel  paper (as such term is defined  in the  Uniform  Commercial  Code as in
effect in any applicable  jurisdiction),  no security interest in this Amendment
to the Second Security Agreement and Chattel Mortgage may be created through the
transfer  or  possession  of  any  counterpart  other  than  the  original.  The
counterpart to be deemed the original shall be the counterpart that contains the
receipt  therefor  executed  by  Deutsche  Bank  Trust  Company   Americas,   as
Administrative  Agent, on the signature page thereof and no security interest in
this  Amendment to the Second  Security  Agreement  and Chattel  Mortgage may be
created  through  the  transfer  of any  counterpart  other  than said  original
counterpart.



            WHEREAS,  subject to the terms and conditions  set forth below,  the
parties hereto wish to amend certain provisions of the Aircraft Chattel Mortgage
as provided herein.

            NOW THEREFORE, it is agreed:

      1. The  Aircraft  Chattel  Mortgage is hereby  amended,  by  deleting  all
references to the term "Credit  Agreement" and inserting the term "Fifth Amended
and Restated Credit Agreement" in lieu thereof.

      2. Section 1(a)(iii) of the Aircraft Chattel Mortgage is hereby deleted in
its entirety and the following is inserted in its place:

      "(iii) all appliances,  parts,  instruments,  appurtenances,  accessories,
furnishings and other equipment of whatever nature (other than complete  Engines
or  engines),  that may from time to time be  incorporated  or  installed  in or
attached to the Airframe or any Engine, together with (i) all appliances, parts,
instruments, appurtenances,  accessories, furnishings, other equipment purchased
or owned by the Borrower and identified for  incorporation or installation in or
attachment to the Airframe or any Engine  pursuant to the terms of any agreement
whether  or not  identified  in a  Supplemental  Chattel  Mortgage  and (ii) all
appliances,  parts,  instruments,  appurtenances,  accessories,  furnishings and
other equipment of whatever  nature removed from the Airframe or any Engine,  no
matter where located, until such time as it shall be replaced on the Airframe or
any  Engine  by  an  appliance,  part,  instrument,   appurtenance,   accessory,
furnishing or other equipment in as good operating condition as and with a value
and  utility  at  least  equal  to  the  item  removed.  Immediately  upon  such
replacement,   such  replacement  appliance,  part,  instrument,   appurtenance,
accessory,  furnishing or other  equipment  shall become subject to the lien and
security  interest of this  Mortgage and shall be deemed part of the Airframe or
such  Engine  for  all  purposes  hereof  to the  same  extent  as the  property
originally comprising or installed on the Airframe or any Engine and the removed
item  shall no longer  be  subject  to the lien and  security  interest  of this
Mortgage (collectively referred to herein as "PARTS"); and"

      3. Section 1(b) of the Aircraft  Chattel Mortgage is hereby amended (x) by
deleting  the text "and" from the end of clause  (xii) of section  1(b),  (y) by
renumbering  clause (xiii) of Section 1(b) as clause (xvi), and (z) by inserting
the following new clauses:

      "(xiii) the Holdings  Guaranty,  including without limitation all payments
of any kind  thereunder,  and  including  all rights of Company,  as  guaranteed
beneficiary,  to execute any election or option or to give any notice,  consent,
waiver or approval under or in respect of the Holdings Guaranty,  as well as any
rights,  powers or remedies on the part of Company,  whether  arising  under the
Holdings  Guaranty or by statute or at law or in equity,  or otherwise,  arising
out of any Event of Default or out of any breach of the Holdings Guaranty;

      (xiv) the Subsidiaries Guaranty, including without limitation all payments
of any kind  thereunder,  and  including  all rights of Company,  as  guaranteed
beneficiary,  to execute any election or option or to give any notice,  consent,
waiver or approval under or in respect of the Subsidiaries  Guaranty, as well as
any rights, powers or remedies on the part of Company, whether arising under the
Subsidiaries  Guaranty  or by  statute  or at law or in  equity,  or  otherwise,
arising  out of any Event of Default  or out of any  breach of the  Subsidiaries
Guaranty; and"



      (xv) that certain  intercompany  claim owed by Polar Air to Company in the
amount  of not less  than  $5,285,660  in  unpaid  basic  rent  and  maintenance
reserves, plus an undetermined amount of other unpaid supplemental rent, in each
case under the Polar Air Lease (the  "INTERCOMPANY  CLAIM"),  which Intercompany
Claim survives the effective date of the Plan of Reorganization  pursuant to the
terms thereof; and"

      4.  Section  2 of the  Aircraft  Chattel  Mortgage  is hereby  amended  by
inserting the following new defined term in the appropriate alphabetical order:

      "FIFTH AMENDED AND RESTATED CREDIT AGREEMENT" shall mean the Fifth Amended
and Restated Credit  Agreement,  dated as of July 27, 2004,  among Company,  the
lenders  from time to time  party  thereto,  and the  Administrative  Agent,  as
amended, modified or supplemented from time to time.

      5.  Section  4 of the  Aircraft  Chattel  Mortgage  is hereby  amended  by
inserting the following section after Section (j):

      "(k) INTERCOMPANY CLAIM. Upon the occurrence and during the continuance of
an Event  of  Default,  Company  will  cause  all  payments  in  respect  of the
Intercompany  Claim  to  be  made  directly  to  the  Administrative  Agent  for
application  as set  forth in  Section  2.4B(iii)(b)  of the Fifth  Amended  and
Restated Credit Agreement."

      6. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  (including  by way of  facsimile  or  electronic
transmission)  shall be an original,  but all of which shall together constitute
one and the same instrument. A complete set of counterparts shall be lodged with
Company and the Administrative Agent.

      7. This  Amendment  is limited as  specified  and shall not  constitute  a
modification,  acceptance  or  waiver  of any other  provision  of the  Aircraft
Chattel Mortgage.

      8. From and after the date hereof,  all references in the Aircraft Chattel
Mortgage to the Aircraft  Chattel  Mortgage  shall be deemed to be references to
Aircraft Chattel Mortgage as modified hereby.

                                      * * *




            IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  their duly
authorized  officers to execute and deliver this  Amendment as of the date first
above written.

                                        ATLAS AIR, INC.


                                        By: /s/ William C. Bradley
                                            ---------------------------------
                                            Name: William C. Bradley
                                            Title: Vice President & Treasurer

                                                  Security Agreement and Chattel
                                        Mortgage Amendment to the First Security
                                                  Agreement and Chattel Mortgage
                                                           (Aircraft No. N355MC)



                                        DEUTSCHE BANK TRUST COMPANY
                                        AMERICAS,

                                        as Administrative Agent


                                        By: /s/ Keith C. Braun
                                            ---------------------------------
                                            Name: Keith C. Braun
                                            Title: Director

                                                  Security Agreement and Chattel
                                        Mortgage Amendment to the First Security
                                                  Agreement and Chattel Mortgage
                                                           (Aircraft No. N355MC)



                           Schedule to Exhibit 10.5.5

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
REGISTRATION         MANUFACTURER'S SERIAL    AGENT            BORROWER                  AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
                                                                             
N540MC               22508                    Deutsche Bank    Atlas Air, Inc.           Amendment No. 1 to Second
                                              Trust Company                              Security Agreement (N540MC)
                                              Americas                                   dated as of July 27, 2004
                                                                                         to secure obligations under
                                                                                         the Aircraft Credit
                                                                                         Facility.
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
N536MC               21576                    Deutsche Bank    Atlas Air, Inc.           Amendment No. 2 to Second
                                              Trust Company                              Security Agreement (N536MC)
                                              Americas                                   dated as of July 27, 2004
                                                                                         to secure obligations under
                                                                                         the Aircraft Credit
                                                                                         Facility.
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

EX-10.5.6

                                                                  EXHIBIT 10.5.6

                                                                  EXECUTION COPY

           AMENDMENT NO. 4 TO SECURITY AGREEMENT AND CHATTEL MORTGAGE
                            (AIR CRAFT NO. N355MC)(1)

            THIS FOURTH AMENDMENT TO THE SECURITY AGREEMENT AND CHATTEL MORTGAGE
is dated as of November 30, 2004,  (this  "AMENDMENT"),  and entered into by and
between ATLAS AIR INC., a Delaware  corporation  ("COMPANY"),  and DEUTSCHE BANK
TRUST COMPANY  AMERICAS,  as agent for and  representative  of  ("ADMINISTRATIVE
AGENT") the financial  institutions  ("LENDERS")  party to the Credit  Agreement
referred to below.  Unless otherwise defined herein,  all capitalized terms used
herein and defined in the Credit Agreement  referred to below are used herein as
therein defined.

                              W I T N E S S E T H:

            WHEREAS, Company is party to that certain Fifth Amended and Restated
Credit Agreement, dated as of July 27, 2004, among Company, Atlas Air Worldwide
Holdings, Inc., the Lenders from time to time party thereto and the
Administrative Agent (as amended, modified and/or supplemented from time to
time, the "CREDIT AGREEMENT").

            WHEREAS,  Company and the  Administrative  Agent are parties to that
certain First Security Agreement and Chattel Mortgage with respect to one Boeing
747-341, U.S. Registration No. N355MC, Manufacturer's Serial Number 23395, dated
May 18, 2000,  between Atlas Air, Inc. as debtor and Deutsche Bank Trust Company
Americas (formerly Bankers Trust Company) as Agent for and Representative of the
Lenders referred to therein,  recorded by the Federal Aviation Administration on
July 5, 2000,  as Conveyance  No.  XX015579,  amended by the First  Amendment to
First Security  Agreement and Chattel Mortgage  (Aircraft No. 23395) dated as of
May 1, 2002,  recorded May 29, 2002, as Conveyance No. M000709,  further amended
by the  Second  Amendment  to First  Security  Agreement  and  Chattel  Mortgage
(Aircraft  No.  N355MC)  dated as of April 30, 2004,  recorded May 27, 2004,  as
Conveyance No.  MM026454,  further  amended by Amendment No. 3 to First Security
Agreement and Chattel Mortgage  (Aircraft No. N355MC) dated as of July 27, 2004,
recorded  August 25, 2004,  as Conveyance  No.  Q073443 (the  "AIRCRAFT  CHATTEL
MORTGAGE") and

            WHEREAS, subject to the terms and conditions set forth below, the
parties hereto wish to amend certain provisions of the Aircraft Chattel Mortgage
as provided herein.

            NOW THEREFORE, it is agreed:

- ----------
(1) This Amendment to the First Security Agreement and Chattel Mortgage has been
executed in several counterparts.  To the extent, if any, that this Amendment to
the First Security Agreement and Chattel Mortgage  constitutes chattel paper (as
such  term  is  defined  in the  Uniform  Commercial  Code as in  effect  in any
applicable  jurisdiction)  no security  interest in this  Amendment to the First
Security  Agreement and Chattel  Mortgage may be created through the transfer or
possession of any  counterpart  other than the original.  The  counterpart to be
deemed the original shall be the counterpart  that contains the receipt therefor
executed by Deutsche Bank Trust Company Americas,  as  Administrative  Agent, on
the  signature  page thereof and no security  interest in this  Amendment to the
First  Security  Agreement  and  Chattel  Mortgage  may be created  through  the
transfer of any counterpart other than said original counterpart.



      1. Section 1(b)(i) of the Aircraft  Chattel  Mortgage is hereby amended by
deleting such  subsection  in its entirety and  inserting the following  text in
lieu thereof:

      (i) all the tolls, rents,  issues,  profits,  revenues and other income of
the property subject or required to be subject to the lien of this Mortgage;

      2. Section 1(b)(xvi) of the Aircraft Chattel Mortgage is hereby amended by
deleting the period and inserting a semi-colon at the end thereof;

      3. Section 1(b) is hereby  amended by inserting the  following  text after
Section 1(b)(xvi):

      "PROVIDED,   HOWEVER,  that  in  no  event  shall  such  Aircraft  Related
      Collateral  include or be deemed or  construed to include any accounts (as
      such term is defined in the  Uniform  Commercial  Code as in effect in any
      applicable  jurisdiction)  or other  rights to  payment  arising  from the
      rendition of any ACMI Contract."

      4. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  shall be an  original,  but all of  which  shall
together constitute one and the same instrument.  A complete set of counterparts
executed  by all the  parties  hereto  shall  be  lodged  with  Company  and the
Administrative Agent.

      5. This  Amendment  is limited as  specified  and shall not  constitute  a
modification,  acceptance  or  waiver  of any other  provision  of the  Aircraft
Chattel Mortgage.

      6. From and after the date hereof,  all references in the Aircraft Chattel
Mortgage  shall be deemed to be references to the Aircraft  Chattel  Mortgage as
modified hereby.

                                      * * *



            IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  their duly
authorized  officers to execute and deliver this  Amendment as of the date first
above written.

                                        ATLAS AIR, INC.


                                        By: /s/ Dorinda Pannozzo
                                            ---------------------------------
                                            Name: Dorinda Pannozzo
                                            Title: Assistant Treasurer

                                                  Security Agreement and Chattel
                                        Mortgage Amendment to the First Security
                                                  Agreement and Chattel Mortgage
                                                           (Aircraft No. N355MC)



                                        DEUTSCHE BANK TRUST COMPANY
                                        AMERICAS,

                                        as Administrative Agent


                                        By: /s/ David J Bell
                                            ---------------------------------
                                            Name: David J Bell
                                            Title: Managing Director

                                                  Security Agreement and Chattel
                                        Mortgage Amendment to the First Security
                                                  Agreement and Chattel Mortgage
                                                           (Aircraft No. N355MC)






                           Schedule to Exhibit 10.5.6

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
REGISTRATION         MANUFACTURER'S SERIAL    AGENT            BORROWER                  AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
                                                                             
N540MC               22508                    Deutsche Bank    Atlas Air, Inc.           Amendment No. 2 to First
                                              Trust Company                              Security Agreement (N540MC)
                                              Americas                                   dated as of November 30,
                                                                                         2004 to secure obligations
                                                                                         under the Aircraft Credit
                                                                                         Facility.
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N536MC               21576                    Deutsche Bank    Atlas Air, Inc.           Amendment No. 3 to First
                                              Trust Company                              Security Agreement (N536MC)
                                              Americas                                   dated as of November 30,
                                                                                         2004 to secure obligations
                                                                                         under the Aircraft Credit
                                                                                         Facility.
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

EX-10.5.7

                                                                  EXHIBIT 10.5.7


                                                                  EXECUTION COPY

           AMENDMENT NO. 4 TO SECURITY AGREEMENT AND CHATTEL MORTGAGE
                            (AIRCRAFT NO. N355MC)(1)

            THIS FOURTH  AMENDMENT TO THE SECOND SECURITY  AGREEMENT AND CHATTEL
MORTGAGE is dated as of November 30, 2004, (this "AMENDMENT"),  and entered into
by and between ATLAS AIR, INC., a Delaware corporation ("COMPANY"), and DEUTSCHE
BANK TRUST COMPANY AMERICAS, as agent for and representative of ("ADMINISTRATIVE
AGENT") the financial  institutions  ("LENDERS")  party to the Credit  Agreement
referred to below.  Unless otherwise defined herein,  all capitalized terms used
herein and defined in the Credit Agreement  referred to below are used herein as
therein defined.

                              W I T N E S 5 E T H;

            WHEREAS, Company is party to that certain Fifth Amended and Restated
Credit Agreement,  dated as of July 27, 2004, among Company, Atlas Air Worldwide
Holdings,   Inc.,   the  Lenders  from  time  to  time  party  thereto  and  the
Administrative  Agent (as amended,  modified  and/or  supplemented  from time to
time, the "CREDIT AGREEMENT").

            WHEREAS,  Company and the  Administrative  Agent are parties to that
certain  Second  Security  Agreement  and Chattel  Mortgage  with respect to one
Boeing  741-341,  U.S.  Registration  No. N355MC,  Manufacturer's  Serial Number
23395,  dated May 18, 2000,  between Atlas Air, Inc. as debtor and Deutsche Bank
Trust  Company  Americas  (formerly  Bankers  Trust  Company)  as Agent  for and
Representative  of the  Lenders  referred  to  therein,  recorded by the Federal
Aviation Administration on July 5, 2000, as Conveyance No. XX015580,  amended by
the First Amendment to Second Security  Agreement and Chattel Mortgage (Aircraft
No. 23395) dated as of May 1, 2002,  recorded  June 14, 2002, as Conveyance  No.
M000794,  further amended by the Second  Amendment to Second Security  Agreement
and Chattel Mortgage (Aircraft No. N355MC) dated as of April 30, 2004,  recorded
May 27, 2004, as Conveyance No. MM026455,  further amended by Amendment No. 3 to
Second Security Agreement and Chattel Mortgage (Aircraft No. N355MC) dated as of
July 27,  2004,  recorded  August 25,  2004,  as  Conveyance  No.  Q073444  (the
"AIRCRAFT CHATTEL MORTGAGE") and

            WHEREAS,  subject to the terms and conditions  set forth below,  the
parties hereto wish to amend certain provisions of the Aircraft Chattel Mortgage
as provided herein.

            NOW THEREFORE, it is agreed:

- ----------
(1) This  Amendment to the Second  Security  Agreement and Chattel  Mortgage has
been  executed  in  several  counterparts.  To the  extent,  if any,  that  this
Amendment to the Second  Security  Agreement  and Chattel  Mortgage  constitutes
chattel  paper (as such term is defined  in the  Uniform  Commercial  Code as in
effect in any applicable  jurisdiction),  no security interest in this Amendment
to the Second Security Agreement and Chattel Mortgage may be created through the
transfer  or  possession  of  any  counterpart  other  than  the  original.  The
counterpart to be deemed the original shall be the counterpart that contains the
receipt  therefor  executed  by  Deutsche  Bank  Trust  Company   Americas,   as
Administrative  Agent, on the signature page thereof and no security interest in
this  Amendment to the Second  Security  Agreement  and Chattel  Mortgage may be
created  through  the  transfer  of any  counterpart  other  than said  original
counterpart.



      1. Section 1(b)(i) of the Aircraft  Chattel  Mortgage is hereby amended by
deleting such  subsection  in its entirety and  inserting the following  text in
lieu thereof:

      (i) all the tolls, rents,  issues,  profits,  revenues and other income of
the property subject or required to be subject to the lien of this Mortgage;

      2. Section 1(b)(xvi) of the Aircraft Chattel Mortgage is hereby amended by
deleting the period and inserting a semi-colon at the end thereof;

      3. Section 1(b) is hereby  amended by inserting the  following  text after
Section 1(b)(xvi):

      "PROVIDED,   HOWEVER,  that  in  no  event  shall  such  Aircraft  Related
      Collateral  include or be deemed or  construed to include any accounts (as
      such term is defined in the  Uniform  Commercial  Code as in effect in any
      applicable  jurisdiction)  or other  rights to  payment  arising  from the
      rendition of any ACMI Contract."

      4. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  shall be an  original,  but all of  which  shall
together constitute one and the same instrument.  A complete set of counterparts
executed  by all the  parties  hereto  shall  be  lodged  with  Company  and the
Administrative Agent.

      5. This  Amendment  is limited as  specified  and shall not  constitute  a
modification,  acceptance  or  waiver  of any other  provision  of the  Aircraft
Chattel Mortgage.

      6. From and after the date hereof,  all references in the Aircraft Chattel
Mortgage  shall be deemed to be references to the Aircraft  Chattel  Mortgage as
modified hereby.

                                      * * *




            IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  their duly
authorized  officers to execute and deliver this  Amendment as of the date first
above written.

                                        ATLAS AIR, INC.


                                        By: /s/ Dorinda Pannozzo
                                            ---------------------------------
                                            Name: Dorinda Pannozzo
                                            Title: Assistant Treasurer

                                                  Security Agreement and Chattel
                                        Mortgage Amendment to the First Security
                                                  Agreement and Chattel Mortgage
                                                           (Aircraft No. N355MC)



                                        DEUTSCHE BANK TRUST COMPANY
                                        AMERICAS,

                                        as Administrative Agent


                                        By: /s/ David J Bell
                                            ---------------------------------
                                            Name: David J Bell
                                            Title: Managing Director

                                                  Security Agreement and Chattel
                                        Mortgage Amendment to the First Security
                                                  Agreement and Chattel Mortgage
                                                           (Aircraft No. N355MC)






                           Schedule to Exhibit 10.5.7

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
REGISTRATION         MANUFACTURER'S SERIAL    AGENT            BORROWER                  AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
                                                                             
N540MC               22508                    Deutsche Bank    Atlas Air, Inc.           Amendment No. 2 to Second
                                              Trust Company                              Security Agreement (N540MC)
                                              Americas                                   dated as of November 30,
                                                                                         2004 to secure obligations
                                                                                         under the Aircraft Credit
                                                                                         Facility.
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N536MC               21576                    Deutsche Bank    Atlas Air, Inc.           Amendment No. 3 to Second
                                              Trust Company                              Security Agreement (N536MC)
                                              Americas                                   dated as of November 30,
                                                                                         2004 to secure obligations
                                                                                         under the Aircraft Credit
                                                                                         Facility.
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

EX-10.6.2

                                                                  EXHIBIT 10.6.2


                           FIRST AMENDMENT AND CONSENT

      FIRST AMENDMENT AND CONSENT (this  "AMENDMENT"),  dated as of November 30,
2004,  among ATLAS  FREIGHTER  LEASING  III,  INC., a Delaware  corpration  (the
"BORROWER"), the lenders from time to time party to the Credit Agreement (each a
"LENDER"  and,  collectively,  the  "LENDERS"),  and DEUTSCHE BANK TRUST COMPANY
AMERICAS,  as  Administrative  Agent  (in  such  capacity,  the  "ADMINISTRATIVE
AGENT").  Unless otherwise defined herein, all capitalized terms used herein and
defined in the Credit  Agreement  referred  to below are used  herein as therein
defined.

                              W-I-T-N-E-S-S-E-T-H:

      WHEREAS,  the  Borrower,  the  Lenders and the  Administrative  Agent have
entered into an Amended and Restated Credit Agreement, dated as of July 27, 2004
(the "CREDIT AGREEMENT"); and

      WHEREAS,  subject to the terms and conditions set forth below, the parties
hereto wish to amend  certain  provisions  of the Credit  Agreement  as provided
herein;

      NOW, THEREFORE, it is agreed;

A. AMENDMENTS TO THE CREDIT AGREEMENT

      1. The  definition  of "Exit  Facility"  appearing  in Section  1.1 of the
Credit  Agreement is hereby amended deleting such definition in its entirety and
inserting the following text in lieu thereof:

      ""EXIT  FACILITY"  means the primary senior  revolving  credit facility or
      facilities  of the  Company  and/or  Polar Air,  whether  now  existing or
      hereafter arising,  which allow the Company and/or Polar Air to borrow and
      reborrow  amounts (or have letters of credit issued for its account) up to
      a borrowing  base  determined  by the lenders  thereunder,  as same may be
      amended,  modified,  supplemented,  refinanced  or  replaced  from time to
      time."

B. CONSENT

      1. The  Lenders  hereby  consent  to amend the Leases as  provided  in the
amendment to the Leases attached hereto as Exhibit A.

C. MISCELLANEOUS PROVISIONS

      1. In order to  induce  the  Lenders  to enter  into this  Amendment,  the
Borrower  herby  represents and warts to each of the Lenders that (i) all of the
representations  and  warranties  contained in the Credit  Agreement  and in the
other Loan Documents are true and correct in all material  respects on and as of
the First  Amendment  Effective Date (as defined  below),  both before and after
giving effect to this Amendment (unless such representations and warranties



relate to a  specific  earlier  date,  in which  case such  representations  and
warranties  shall be true and correct as of such earlier  date),  and (ii) there
exists no Default or Event of Default  on the First  Amendment  Effective  Date,
both before and after giving effect to this Amendment.

      2. This  Amendment is limited as  specified  and shall not  constitute  an
amendment,  modification,  acceptance  or waiver of any other  provision  of the
Credit Agreement or any other Loan Document.

      3. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  shall be an  original,  but all of  which  shall
together constitute one and the same instrument.  A complete set of counterparts
executed by all the parties  hereto  shall be lodged with the  Borrower  and the
Administrative Agent.

      4. THIS AMENDMENT AND THE RIGHTS AND  OBLIGATIONS OF THE PARTIES  HEREUNER
SHALL BE  CONSTRUED IN  ACCORDANCE  WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.

      5. This Amendment shall become effective on the date (the "FIRST AMENDMENT
EFFECTIVE  DATE") when the Borrower and the Required Lenders shall have signed a
counterpart  hereof (whether the same or different  counterparts) and shall have
delivered (including by way of telecopier) the same to the Administrative Agent.

      6. From and after the First  Amendment  Effective  Date, all references in
the Credit  Agreement  and in the other Loan  Documents to the Credit  Agreement
shall be deemed to be referenced to the Credit Agreement as modified hereby.

                                      * * *


                                      -2-


      IN WITNESS WHEREOF,  the undersigned have caused this Amendment to be duly
executed and delivered as of the date first above written.

                                             ATLAS FREIGHTER LEASING III, INC.


                                             By: /s/ William C. Bradley
                                                 ------------------------------
                                                 Name: William C. Bradley
                                                 Title: Treasurer & Secretary



                                             DEUTSCHE BANK TRUST COMPANY
                                             AMERICAS, as Administrative Agent


                                             By: /s/ Mark B. Cohen
                                                 ------------------------------
                                                 Name: Mark B. Cohen
                                                 Title: Managing Director
                                                        Head of [ILLEGIBLE]



                                             CREDIT SUISSE FIRST BOSTON


                                             By: /s/ Gil Golan
                                                 ------------------------------
                                                 Name:  Gil Golan
                                                 Title: Assistant Vice President


                                             By: /s/ Joseph Brosnan
                                                 ------------------------------
                                                 Name:  Joseph Brosnan
                                                 Title: Vice President


               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                           APEX (IDM) CDOI, LTD
                                           ELC (CAYMAN) LTD, CDO Series 1999-I
                                           ELC (CAYMAN) LTD, 1999-II
                                           ELC (CAYMAN) LTD, 1999-III
                                           ELC (CAYMAN) LTD, 2000-I


                                           By: /s/ [ILLEGIBLE]
                                               -------------------------------
                                               Title: Managing Director
                                                      BABSON CAPITAL
                                                      MANAGEMENT LLC, IN ITS
                                                      CAPACITY AS COLLATERAL
                                                      MANAGER, PORTFOLIO MANAGER
                                                      OR INVESTMENT MANAGER

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                             TRYON CLO LTD 2000-I
                                             SUFFIELD CLO, LIMITED


                                             By: /s/ [ILLEGIBLE]
                                                 -------------------------------
                                                 Title: MANAGING DIRECTOR
                                                 BABSON CAPITAL MANAGEMENT LLC,
                                                 AS COLLATERAL MANAGER

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                             GOLDMAN SACHS CREDIT PARTNERS L.P.,


                                             By: /s/ [ILLEGIBLE]
                                                 -------------------------------
                                                 Title: Managing Director

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                      CANPARTNERS INVESTMENTS IV, LLC

                                      By: CANPARTNERS INVESTMENTS IV, LLC,
                                          A CALIFORNIA LIMITED LIABILITY COMPANY


                                      By: /s/ R. Christian B. Evensen
                                          --------------------------------------
                                          R. Christian B. Evensen
                                          Managing Director

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                RZB Finance LLC


                                By: /s/ Christoph Hoedl      /s/ Elisabeth Hirst
                                    --------------------------------------------
                                    Title: Christoph Hoedl   Elisabeth Hirst
                                           Vice President    AVP

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                            Sankaty High Yield Partners II, L.P.


                                            By: /s/ Jeffrey Hawkins
                                               ---------------------------------
                                                    Title: JEFFREY HAWKINS
                                                           SENIOR VICE PRESIDENT

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                           Sankaty High Yield Partners III, L.P.


                                           By: /s/ Jeffrey Hawkins
                                               ---------------------------------
                                               Title: JEFFREY HAWKINS
                                                      SENIOR VICE PRESIDENT

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                 Sankaty Advisors, LLC as Collateral Manager for
                                 Prospect Funding I, LLC, as Term Lender


                                 By: /s/ Jeffrey Hawkins
                                     -------------------------------------------
                                     Title: JEFFREY HAWKINS
                                            SENIOR VICE PRESIDENT

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                               Sankaty High Yield [ILLEGIBLE] Partners, L.P.


                               By: /s/ Jeffrey Hawkins
                                   ---------------------------------------------
                                   Title: JEFFREY HAWKINS
                                          SENIOR VICE PRESIDENT

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                              Sankaty Credit Opportunities, L.P.


                                              By: /s/ Jeffrey Hawkins
                                                  ------------------------------
                                                  Title: JEFFREY HAWKINS
                                                         SENIOR VICE PRESIDENT

               [Signature Page to the First Amendment and Consent
                  to the Amended and Restated Credit Agreement]



                                                                       EXHIBIT A

                                  [Attached.]



                                                                  EXECUTION COPY

                             AMENDMENT NO. 1 TO THE
                     AMENDED AND RESTATED LEASE AGREEMENT(1)

      AMENDMENT  NO.  1 TO  THE  AMENDED  AND  RESTATED  LEASE  AGREEMENT  (this
"AMENDMENT"),  dated as of November 30, 2004,  between ATLAS  FREIGHTER  LEASING
III,  INC.,  a Delaware  corporation  ("LESSOR"),  ATLAS AIR,  INC.,  a Delaware
corporation  ("LESSEE")  and  accepted  and  agreed  to by ATLAS  AIR  WORLDWIDE
HOLDINGS,  INC.  ("HOLDINGS")  and by DEUTSCHE BANK TRUST COMPANY  AMERICAS,  as
administrative agent under the Credit Agreement (in such capacity, the "AGENT").
Unless otherwise  defined herein,  all capitalized terms used herein and defined
in the Lease referred to below are used herein as therein defined.

                              W-I-T-N-E-S-S-E-T-H:

      WHEREAS,  the Lessor,  the lenders from time to time party thereto (each a
"LENDER" and,  collectively,  the  "LENDERS") and the Agent have entered into an
Amended and Restated  Credit  Agreement,  dated as of July 27, 2004 (the "CREDIT
AGREEMENT");

      WHEREAS,  Lessor and Lessee are party to the  Amended and  Restated  Lease
Agreement,  dated as of July 27,  2004 (the  "LEASE"),  which  Lease is  further
described on Annex A attached hereto; and

      WHEREAS,  subject to the terms and conditions set forth below, the parties
hereto wish to amend certain provisions of the Lease as provided herein;

      NOW, THEREFORE, it is agreed;

A. AMENDMENTS TO THE LEASE

      1. The definition of "ACMI  Contract"  appearing in Section 1 of the Lease
is hereby amended by deleting such  definition in its entirety and inserting the
following text in lieu thereof:

      ""ACMI  CONTRACT"  means  (i) any  contract  entered  into  by the  Lessee
      pursuant to which Lessee  furnishes the aircraft,  crew,  maintenance  and
      insurance and customers bear all

- ----------
(1)   This Amendment has been executed in several  counterparts.  To the extent,
      if any,  that this  Amendment  constitutes  chattel paper (as such term is
      defined  in the  Uniform  Commercial  Code as in effect in any  applicable
      jurisdiction),  no  security  interest  in this  Amendment  may be created
      through  the  transfer or  possession  of any  counterpart  other than the
      original.  The  counterpart  to  be  deemed  the  original  shall  be  the
      counterpart that contains the receipt  therefor  executed by Deutsche Bank
      Trust Company  Americas,  as  Administrative  Agent, on the signature page
      thereof and no security  interest in this Amendment may be created through
      the transfer of any counterpart other than said original counterpart.



      other operating expenses,  (ii) any similar contract in which the customer
      provides the flight crew, all in accordance  with the Lessee's  historical
      practices and (iii) any wet lease or service  contract  whereby the Lessee
      agrees to furnish  an  aircraft  to a third  party  pursuant  to which the
      aircraft shall at all times be in operational control of the Lessee."

      2. Section 1 of the Lease is hereby amended by inserting the following new
definition in the appropriate alphabetical order:

      ""BLADE  AND  DISK  CAPITAL   EXPENDITURES"  means  Consolidated   Capital
      Expenditures  for  under  platform  cracking,  including  blade  and  disk
      replacement, required for CF6-80C2 engines. "

      3. The definition of "Exit  Facility"  appearing in Section 1 of the Lease
is hereby amended by deleting such  definition in its entirety and inserting the
following text in lieu thereof:

      ""EXIT  FACILTY" means the primary  senior  revolving  credit  facility or
      facilities  of the  Lessee  and/or  Polar Air,  whether  now  existing  or
      hereafter  arising,  which allow the Lessee and/or Polar Air to borrow and
      reborrow amounts (or have letter of credit issued for its account) up to a
      borrowing  base  determined  by the  lenders  thereunder,  as same  may be
      amended,  modified,  supplemented,  refinanced  or  replaced  from time to
      time."

      4. The definition of "Maximum  Capital  Expenditure  Amount"  appearing in
Section 1 of the Lease is hereby  amended by  deleting  such  definition  in its
entirety and inserting the following text in lieu thereof:

      ""MAXIMUM  CAPITAL   EXPENDITURE   AMOUNT"  means  for  any  Fiscal  Year,
      $25,000,000."

      5.  Section  7(a)(8) of the Lease is hereby  amended by deleting  the text
"the  Lessee"  appearing  therein  and  inserting  the  text  "Holdings  and its
Subsidiaries" in lieu thereof.

      6. Section  7(b)C.  of the Lease is hereby  amended by inserting  the text
"and the Exit  Facility"  immediately  following  the  text  "Credit  Agreement"
appearing in the first sentence thereof.

      7. Section 7(d)(4) of the Lease is hereby amended by deleting such section
in its entirety and inserting the following text in lieu thereof:

      "(6)  Holdings  and its  Subsidiaries  may become and remain  liable  with
      respect to Contingent Obligations arising under the Exit Facility;"

      8. Section 7(g)(7) of the Lease is hereby amended by deleting such section
in its entirety and inserting the following text in lieu thereof:

      "(7)  Holdings  and its  Subsidiaries  may  make (V)  Consolidated  Capita
      Expenditures  not in  excess of the  Maximum  Capital  Expenditure  Amount
      during any Fiscal Year, (W) Consolidated Capital Expenditures  required to
      retrofit airplanes in order to conform to FAA regulations in an amount not
      to  exceed   $7,000,000  in  the  aggregate,   (X)  Consolidated   Capital
      Expenditures constituting the reinvestment of proceeds of Asset


                                      -2-


      Sales not required to repay the Loans  pursuant to subsection  2.4B(ii)(a)
      of the  Amended  Aircraft  Credit  Facility,  (y) Blade  and Disk  Capital
      Expenditures  in an amount not to exceed  $15,000,000 in the aggregate and
      (z) Consolidated  Capital Expenditures  required to satisfy  Back-To-Birth
      Traceability  Issues;  PROVIDED  that  up to  50% of any  amount  of  such
      Consolidated Capital Expenditures permitted pursuant to clause (V) of this
      subsection (7), but not made, in any Fiscal Year may be carried forward to
      and made during the immediately succeeding Fiscal Year (but no amount once
      carried  forward to the next  Fiscal  Year may be  carried  forward to any
      Fiscal Year thereafter);"

      9. Section 7(m) of the Lease is hereby  amended by inserting the following
new sentence at the end thereof:

      "Notwithstanding  anything to the contrary contained in clause (1) and (2)
      above in this paragraph,  Holdings and its  Subsidiaries may pledge shares
      of capital stock of any of its Subsidiaries  (including  Holdings and such
      Subsidiary,  but excluding the capital stock of Lessor) to secure the Exit
      Facility  or  their  Contingent   Obligations   arising   thereunder."

B. MISCELLANEOUS PROVISIONS

      1. In order to induce  the Agent to enter  into this  Amendment,  Holdings
hereby  represents  and  warrants  to each  of the  Lender  that  (i) all of the
representations  and  warranties  contained in the Lease are true and correct in
all material  respects on and as of the First  Amendment  Effective  Date,  both
before and after giving effect to this  Amendment  (unless such  representations
and  warranties   relate  to  a  specific  earlier  date,  in  which  case  such
representations  and  warranties  shall be true and  correct as of such  earlier
date),  and (ii)  there  exists  no  Default  or Event of  Default  on the First
Amendment Effective Date, both before and after giving effect to this Amendment.

      2. This  Amendment  is limited as  specified  and shall not  constitute  a
modification, acceptance or waiver of any other provision of the Lease.

      3. This Amendment may be execute in any number of counterparts  and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  shall be an  original,  but all of  which  shall
together constitute one and the same instrument.  A complete set of counterparts
executed by all the pares hereto shall be lodged with Holdings and the Agent.

      4. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES  HEREUNDER
SHALL BE  CONSTRUED IN  ACCORDANCE  WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.

      5. This Amendment shall become effective on the date (the "FIRST AMENDMENT
EFFECTIVE DATE") when Holdings, Lessor, Lessee and the Agent shall have signed a
counterpart  hereof (whether the same or different  counterparts) and shall have
delivered  (including by way of telecopier) the same to the Agent,  thereafter a
counterpart  of this Amendment  will be filed for  recordation  with the Federal
Aviation Administration Civil Aircraft Registry.


                                      -3-


      6. From and after the First  Amendment  Effective  Date, all references in
the Lease and in the other  Loan  Documents  to the Lease  shall be deemed to be
referenced to the Lease as modified hereby.

                                     * * *


                                      -4-


                                                                  EXECUTION COPY

      IN WITNESSS WHEREOF, the undersigned have caused this Amendment to be duly
executed and delivered as of the date first above written.

                                              ATLAS FREIGHTER LEASING III, INC.


                                              By:
                                                  ------------------------------
                                                  Name:
                                                  Title:

                                              ATLAS AIR, INC.


                                              By:
                                                  ------------------------------
                                                  Name:
                                                  Title:

Accepted and Agreed:

                                              ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                              By:
                                                  ------------------------------
                                                  Name:
                                                  Title:



Accepted and Agreed:

                                              DEUTSCHE BANK TRUST COMPANY
                                              AMERICAS, as Agent


                                              By:
                                                  ------------------------------
                                                  Name:
                                                  Title:



                                                                         ANNEX A

        [add description of lease and aircraft engines covered thereby]

EX-10.6.4

                                                                  EXHIBIT 10.6.4


                                                                  EXECUTION COPY

TO THE EXTENT, IF ANY, THAT THIS LEASE SUPPLEMENT  CONSTITUTES CHATTEL PAPER (AS
SUCH TERM IS IN EFFECT IN ANY APPLICABLE JURISDICTION),  NO SECURITY INTEREST IN
THIS LEASE  SUPPLEMENT MAY BE CREATED  THROUGH THE TRANSFER OR POSSESSION OF ANY
COUNTERPART OTHER THAN THE ORIGINAL EXECUTED COUNTERPART  CONTAINING THE RECEIPT
THEREFOR EXECUTED BY THE AGENT ON THE SIGNATURE PAGE HEREOF.

                             LEASE SUPPLEMENT NO. 1

            LEASE SUPPLEMENT No. 1, dated July 27, 2004, between ATLAS FREIGHTER
LEASING III, INC., (the "Lessor"), and ATLAS AIR, INC. (the "Lessee").

            The Lessor and the Lessee have heretofore entered into a Amended and
Restated  Lease  Agreement  (N505MC),  dated as of July 27, 2004 relating to one
Boeing  B747-2D3B  aircraft  (herein  called the "Lease"  and the defined  terms
therein being  hereinafter used with the same meanings).  The Lease provides for
the  execution  and  delivery  from  time to time of Lease  Supplements  for the
purpose  of  leasing  the  Airframe  and  Engines  under  the  Lease as and when
delivered by the Lessor to the Lessee in accordance with the terms thereof.

            The Lease relates to the Airframe and Engines described below, and a
counterpart of the Lease is attached  hereto,  and made a part hereof,  and this
Lease Supplement  together with such attachment,  is being filed for recordation
on the date hereof with the Federal Aviation Administration as one document.

            NOW, THEREFORE,  in consideration of the premises and other good and
sufficient consideration, the Lessor and the Lessee hereby agree as follows:

            1. The Lessor  hereby  delivers  and leases to the Lessee  under the
Lease and the Lessee  hereby  accepts and leases from the Lessor under the Lease
the  following  described  Boeing  B747-2D3B  aircraft (the  "Aircraft"),  which
Aircraft as of the date hereof consists of the following components:

            (i) Airframe:  U.S.  Registration No. N505MC;  manufacturer's serial
      no. 21251; and

            (ii)  Engines:  four (4)  aircraft  engines  bearing,  respectively,
      manufacturer's  serial nos. 517597,  530388,  530389,  and 517599 (each of
      which engines has 750 or more rated takeoff  horsepower or the  equivalent
      of such horsepower).

            2.  The  closing  date of the  Aircraft  is the  date of this  Lease
Supplement  set forth in the  opening  paragraph  hereof.  Except  as  otherwise
provided in the Lease,  the Term for the Aircraft  shall commence on the closing
date and end on the Final Maturity Date.

            3. The Lessee  hereby  confirms  to the  Lessor  that the Lessee has
accepted  the  Aircraft  for all  purposes  hereof  and of the  Lease  as  being
airworthy,  in good working order and



repair  and  without  defect  or  inherent  vice in  title,  condition,  design,
operation or fitness for use; PROVIDED,  HOWEVER,  that nothing contained herein
or in the Lease  shall in any way  diminish  or  otherwise  affect any right the
Lessee  or the  Lessor  may  have  with  respect  to the  Aircraft  against  the
manufacturer,  any affiliate  thereof,  or any  subcontractor or supplier of the
manufacturer  or  any  affiliate  thereof,   under  any  purchase  agreement  or
otherwise.

            4.  All  of  the  terms  and  provisions  of the  Lease  are  hereby
incorporated  by  reference  in this Lease  Supplement  to the same extent as if
fully set forth herein.

            5. This Lease  Supplement  may be executed by the parties  hereto in
separate counterparts,  each of which when so executed and delivered shall be an
original,  but all such counterparts  shall together  constitute but one and the
same instrument.


                                      -2-


            IN WITNESS WHEREOF,  the Lessor and the Lessee have each caused this
Lease Supplement to be duly executed as of the day and year first above written.

                                            ATLAS FREIGHTER LEASING III, INC.,
                                             Lessor


                                            By: /s/ William C. Bradley
                                                --------------------------------
                                            Name: William C. Bradley
                                            Title: Treasurer and Secretary


                                                            Amended and Restated
                                                                 Lease Agreement
                                                              (Lease Supplement)
                                                                        (N505MC)


                                           ATLAS AIR, INC.,
                                            Lessee


                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer


                                                            Amended and Restated
                                                                 Lease Agreement
                                                              (Lease Supplement)
                                                                        (N505MC)



Accepted and Agreed:

ATLAS AIR WORLDWIDE HOLDINGS, INC.


By: /s/ William C. Bradley
    --------------------------------
Name: William C. Bradley
Title: Vice President & Treasurer


                                                            Amended and Restated
                                                                 Lease Agreement
                                                              (Lease Supplement)
                                                                        (N505MC)




                           Schedule to Exhibit 10.6.4

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
REGISTRATION         MANUFACTURER'S SERIAL    LESSEE           LESSOR                    AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
                                                                             
N509MC               21221                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N509MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N512MC               21220                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N512MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N517MC               23300                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N517MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N522MC               21783                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N522MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N523MC               21782                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N523MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N524MC               21784                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N524MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N526MC               22337                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N526MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N527MC               22471                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N527MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N528MC               22472                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N528MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N534MC               21832                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N534MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N808MC               21048                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N5808MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N809MC               20887                    Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
                                                               III                       (N580MC) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-50E2 Spare       530168; 517530;          Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
Engines              517790; 517602;                           III                       (CF6-50E2 Spare Engines)
                     517547; 517,538;                                                    dated as of July 27, 2004
                     517,539; 455167; 530255
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-80C2 BSF Spare   704,699; 704860; 704918  Atlas Air, Inc.  Atlas Freighter Leasing   Lease Supplement No. 1
Engines                                                        III                       (CF6-80C2 BSF Spare
                                                                                         Engines) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

EX-10.6.5

                                                                  EXHIBIT 10.6.5

                                                                  EXECUTION COPY

                             AMENDMENT NO. 1 TO THE
                     AMENDED AND RESTATED LEASE AGREEMENT(1)

      AMENDMENT  NO.  1 TO  THE  AMENDED  AND  RESTATED  LEASE  AGREEMENT  (this
"AMENDMENT"),  dated as of November 30, 2004,  between ATLAS  FREIGHTER  LEASING
III,  INC.,  a Delaware  corporation  ("LESSOR"),  ATLAS AIR,  INC.,  a Delaware
corporation  ("LESSEE")  and  accepted  and  agreed  to by ATLAS  AIR  WORLDWIDE
HOLDINGS,  INC.  ("HOLDINGS")  and by DEUTSCHE BANK TRUST COMPANY  AMERICAS,  as
administrative agent under the Credit Agreement (in such capacity, the "AGENT").
Unless otherwise  defined herein,  all capitalized terms used herein and defined
in the Lease referred to below are used herein as therein defined.

                              W-I-T-N-E-S-S-E-T-H:

      WHEREAS,  the Lessor,  the lenders from time to time party thereto (each a
"LENDER" and,  collectively,  the  "LENDERS") and the Agent have entered into an
Amended and Restated  Credit  Agreement,  dated as of July 27, 2004 (the "CREDIT
AGREEMENT");

      WHEREAS,  Lessor and Lessee are party to the  Amended and  Restated  Lease
Agreement,  dated as of July 27,  2004 (the  "LEASE"),  which  Lease is  further
described on Annex A attached hereto; and

      WHEREAS,  subject to the terms and conditions set forth below, the parties
hereto wish to amend certain provisions of the Lease as provided herein;

      NOW, THEREFORE, it is agreed;

A. AMENDMENTS TO THE LEASE

      1. The definition of "ACMI  Contract"  appearing in Section 1 of the Lease
is hereby amended by deleting such  definition in its entirety and inserting the
following text in lieu thereof:

      ""ACMI  CONTRACT"  means  (i) any  contract  entered  into  by the  Lessee
      pursuant to which Lessee  furnishes the aircraft,  crew,  maintenance  and
      insurance and customers bear all

- ----------
(1)   This Amendment has been executed in several  counterparts.  To the extent,
      if any,  that this  Amendment  constitutes  chattel paper (as such term is
      defined  in the  Uniform  Commercial  Code as in effect in any  applicable
      jurisdiction),  no  security  interest  in this  Amendment  may be created
      through  the  transfer or  possession  of any  counterpart  other than the
      original.  The  counterpart  to  be  deemed  the  original  shall  be  the
      counterpart that contains the receipt  therefor  executed by Deutsche Bank
      Trust Company  Americas,  as  Administrative  Agent, on the signature page
      thereof and no security  interest in this Amendment may be created through
      the transfer of any counterpart other than said original counterpart.



      other operating expenses,  (ii) any similar contract in which the customer
      provides the flight crew, all in accordance  with the Lessee's  historical
      practices  and (ii) any wet lease or service  contract  whereby the Lessee
      agrees to furnish  an  aircraft  to a third  party  pursuant  to which the
      aircraft shall at all times be in operational control of the Lessee."

      2. Section 1 of the Lease is hereby amended by inserting the following new
definition in the appropriate alphabetical order:

      ""BLADE  AND  DISK  CAPITAL   EXPENDITURES"  means  Consolidated   Capital
      Expenditures  for  under  platform  cracking,  including  blade  and  disk
      replacement, required for CF6-80C2 engines."

      3. The definition of "Exit  Facility"  appearing in Section 1 of the Lease
is hereby amended by deleting such  definition in its entirety and inserting the
following text in lieu thereof:

      ""EXIT  FACILITY"  means the primary senior  revolving  credit facility or
      facilities  of the  Lessee  and/or  Polar Air,  whether  now  existing  or
      hereafter  arising,  which allow the Lessee and/or Polar Air to borrow and
      reborrow  amounts (or have letters of credit issued for its account) up to
      a borrowing  base  determined  by the lenders  thereunder,  as same may be
      amended,  modified,  supplemented,  refinanced  or  replaced  from time to
      time."

      4. The definition of "Maximum  Capital  Expenditure  Amount"  appearing in
Section 1 of the Lease is hereby  amended by  deleting  such  definition  in its
entirety and inserting the following text in lieu thereof:

      ""MAXIMUM  CAPITAL   EXPENDITURE   AMOUNT"  means  for  any  Fiscal  Year,
      $25,000,000."

      5.  Section  7(a)(8) of the Lease is hereby  amended by deleting  the text
"the  Lessee"  appearing  therein  and  inserting  the  text  "Holdings  and its
Subsidiaries" in lieu thereof.

      6. Section  7(b)C.  of the Lease is hereby  amended by inserting  the text
"and the Exit  Facility"  immediately  following  the  text  "Credit  Agreement"
appearing in the first sentence thereof.

      7. Section 7(d)(4) of the Lease is hereby amended by deleting such section
in its entirety and inserting the following text in lieu thereof:

      "(6)  Holdings  and its  Subsidiaries  may become and remain  liable  with
      respect to Contingent Obligations arising under the Exit Facility;"

      8. Section 7(g)(7) of the Lease is hereby amended by deleting such section
in its entirety and inserting the following text in lieu thereof:

      "(7)  Holdings  and its  Subsidiaries  may make (V)  Consolidated  Capital
      Expenditures  not in  excess of the  Maximum  Capital  Expenditure  Amount
      during any Fiscal Year, (W) Consolidated Capital Expenditures  required to
      retrofit airplanes in order to conform to FAA regulations in an amount not
      to  exceed   $7,000,000  in  the  aggregate,   (X)  Consolidated   Capital
      Expenditures constituting the reinvestment of proceeds of Asset


                                      -2-


      Sales not required to repay the Loan pursuant to subsection 2.4B(ii)(a) of
      the  Amended  Aircraft  Credit  Facility,   (y)  Blade  and  Disk  Capital
      Expenditures  in an amount not to exceed  $15,000,000 in the aggregate and
      (z) Consolidated  Capital Expenditures  required to satisfy  Back-To-Birth
      Traceability  Issues;  PROVIDED  that  up to  50% of any  amount  of  such
      Consolidated Capital Expenditures permitted pursuant to clause (V) of this
      subsection (7), but not made, in any Fiscal Year may be carried forward to
      and made during the immediately succeeding Fiscal Year (but no amount once
      carried  forward to the next  Fiscal  Year may be  carried  forward to any
      Fiscal Year thereafter);"

      9. Section 7(m) of the Lease is hereby  amended by inserting the following
new sentence at the end thereof:

      "Notwithstanding  anything to the contrary contained in clause (1) and (2)
      above in this paragraph,  Holdings and its  Subsidiaries may pledge shares
      of capital stock of any of its Subsidiaries  (including  Holdings and such
      Subsidiary,  but excluding the capital stock of Lessor) to secure the Exit
      Facility or their Contingent Obligations arising thereunder."

B. MISCELLANEOUS PROVISIONS

      1. In order to induce  the Agent to enter  into this  Amendment,  Holdings
hereby  represents  and  warrants  to each of the  Lenders  that  (i) all of the
representations  and  warranties  contained in the Lease are true and correct in
all material  respects on and as of the First  Amendment  Effective  Date,  both
before and after giving effect to this  Amendment  (unless such  representations
and  warranties   relate  to  a  specific  earlier  date,  in  which  case  such
representations  and  warranties  shall be true and  correct as of such  earlier
date),  and (ii)  there  exists  no  Default  or Event of  Default  on the First
Amendment Effective Date, both before and after giving effect to this Amendment.

      2. This  Amendment  is limited as  specified  and shall not  constitute  a
modification, acceptance or waiver of any other provision of the Lease.

      3. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  shall be an  original,  but all of  which  shall
together constitute one and the same instrument.  A complete set of counterparts
executed by all the parties hereto shall be lodged with Holdings and the Agent.

      4. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES  HEREUNDER
SHALL BE  CONSTRUED IN  ACCORDANCE  WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.

      5. This Amendment shall become effective on the date (the "FIRST AMENDMENT
EFFECTIVE DATE") when Holdings, Lessor, Lessee and the Agent shall have signed a
counterpart  hereof (whether the same or different  counterparts) and shall have
delivered  (including by way of telecopier) the same to the Agent,  thereafter a
counterpart  of this Amendment  will be filed for  recordation  with the Federal
Aviation Administration Civil Aircraft Registry.


                                      -3-


      6. From and after the First  Amendment  Effective  Date, all references in
the Lease and in the other  Loan  Documents  to the Lease  shall be deemed to be
referenced to the Lease as modified hereby.

                                      * * *


                                      -4-


      IN WITNESS WHEREOF,  the undersigned have caused this Amendment to be duly
executed and delivered as of the date first above written.

                                              ATLAS FREIGHTER LEASING III, INC.


                                              By: /s/ William C. Bradley
                                                  ------------------------------
                                                  Name: William C. Bradley
                                                  Title: Treasurer & Secretary

                                                                 Lease Amendment
                                                                        (N505MC)



                                              ATLAS AIR, INC.


                                              By: /s/ Dorinda Pannozzo
                                                  ------------------------------
                                                  Name: Dorinda Pannozzo
                                                  Title: Assistant Treasurer

                                                                 Lease Amendment
                                                                        (N505MC)



Accepted and Agreed:

                                              ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                              By: /s/ T. Wakelee Smith
                                                  ------------------------------
                                                  Name: T. Wakelee Smith
                                                  Title: Senior Vice President &
                                                         Chief Operating Officer

                                                                 Lease Amendment
                                                                        (N505MC)



Accepted and Agreed:

                                              DEUTSCHE BANK TRUST COMPANY
                                              AMERICAS, as Agent


                                              By: /s/ David J Bell
                                                  ------------------------------
                                                  Name: David J Bell
                                                  Title: Managing Director

                                                                 Lease Amendment
                                                                        (N505MC)



                                                                         Annex A

1.    BOEING  747-2D3B  AIRCRAFT  WITH  SERIAL  NUMBER  21251 AND UNITED  STATES
      REGISTRATION  NUMBER  N505MC  AND FOUR  GENERAL  ELECTRIC  MODEL  CF6-50E2
      ENGINES WITH SERIAL NUMBERS 517597, 530388, 530389 AND 517599

      LEASE:

      Lease  Agreement  (N505MC)  dated  as of  April  25,  2000  between  Atlas
Freighter  Leasing III, Inc., as lessor,  and Atlas Air,  Inc., as lessee,  with
Lease Supplement No. 1 dated April 25, 2000 attached thereto, which was recorded
by the FAA as one  instrument  on May  24,  2000  and  assigned  Conveyance  No.
DD018944,

      as supplemented  by Lease  Supplement No. 2 dated as of November 13, 2000,
which was recorded by the FAA on December 20, 2000 and assigned  Conveyance  No.
SS016139,

      as amended by Amendment No. 1 to Lease  Agreement  dated as of October 15,
2001, which was recorded by the FAA on January 11, 2002 and assigned  Conveyance
No. SSO18007,

      as amended by Amendment No. 2 to Lease  Agreement  dated as of October 30,
2001,  which was recorded by the FAA on January 9, 2002 and assigned  Conveyance
No. SS018001,

      as amended by Amendment No. 3 to Lease  Agreement dated as of December 14,
2001,  which was recorded by the FAA on March 20, 2002 and  assigned  Conveyance
No. TT016420,

      as amended by Amendment No. 4 to Aircraft Lease Agreement dated as of June
14, 2002 which was recorded by the FAA on August 21,2002 and assigned Conveyance
No. YY034495,

      as amended by Amendment  No. 5 to Lease  Agreement  dated as of August 14,
2002, which was recorded by the FAA on March 4, 2003 and assigned Conveyance No.
GG029430,

      as amended by Amendment No. 6 to Lease  Agreement dated as of December 31,
2002, which was recorded by the FAA on March 4, 2003 and assigned Conveyance No.
GG029431, and

      as amended and restated by Amended and Restated Lease  Agreement  (N505MC)
dated as of July 27,  2004,  with Lease  Supplement  No.1  dated  July 27,  2004
attached thereto,  which was recorded by the FAA on August 24, 2004 and assigned
Conveyance No. NN027685.




                           Schedule to Exhibit 10.6.5

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
REGISTRATION         MANUFACTURER'S SERIAL    LESSEE           LESSOR                    AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
                                                                             
N509MC               21221                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N509MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N512MC               21220                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N512MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N517MC               23300                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N517MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N522MC               21783                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N522MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N523MC               21782                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N523MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N524MC               21784                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N524MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N526MC               22337                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N526MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N527MC               22471                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N527MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N528MC               22472                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N528MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N534MC               21832                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N534MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N808MC               21048                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N808MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N809MC               20887                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
                                                               III                       and Restated Lease (N809MC)
                                                                                         dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-50E2 Spare       530168; 517530;          Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
Engines              517790; 517602;                           III                       and Restated Lease
                     517547; 517,538;                                                    (CF6-50E2 Spare Engines)
                     517,539; 455167; 530255                                             dated as of November 30,
                                                                                         2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-80C2 BSF Spare   704,699; 704860; 704918  Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 1 to Amended
Engines                                                        III                       and Restated Lease
                                                                                         (CF6-80C2 BSF Spare
                                                                                         Engines) dated as
                                                                                         of November 30, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

EX-10.6.6

                                                                  EXHIBIT 10.6.6


                             AMENDMENT NO. 2 TO THE
                     AMENDED AND RESTATED LEASE AGREEMENT(1)

      AMENDMENT  NO.  2 TO  THE  AMENDED  AND  RESTATED  LEASE  AGREEMENT  (this
"AMENDMENT"),  dated as of May 31, 2005,  between ATLAS  FREIGHTER  LEASING III,
INC., a Delaware corporation ("LESSOR"), ATLAS AIR, INC., a Delaware corporation
("LESSEE")  and  accepted  and agreed to by ATLAS AIR  WORLDWIDE  HOLDINGS,  NC.
("HOLDINGS")  and by DEUTSCHE BANK TRUST  COMPANY  AMERICAS,  as  administrative
agent  under the  Credit  Agreement  (in such  capacity,  the  "AGENT").  Unless
otherwise  defined herein,  all capitalized terms used herein and defined in the
Lease referred to below are used herein as therein defined.

                              W I T N E S S E T H:

      WHEREAS,  the Lessor,  the lenders from time to time party thereto (each a
"LENDER" and,  collectively,  the  "LENDERS") and the Agent have entered into an
Amended and Restated  Credit  Agreement,  dated as of July 27, 2004 (as amended,
supplemented   and/or  otherwise   modified  from  time  to  time,  the  "CREDIT
AGREEMENT").

      WHEREAS,  Lessor and Lessee are party to the  Amended and  Restated  Lease
Agreement, dated as of July 27, 2004 (as amended,  supplemented and/or otherwise
modified from time to time,  the "LEASE"),  which Lease is further  described on
Annex A attached hereto; and

      WHEREAS,  subject to the terms and conditions set forth below, the parties
hereto wish to amend certain provisions of the Lease as provided herein;

      NOW, THEREFORE, it is agreed;

A. AMENDMENT TO THE LEASE

      1. The  proviso  to  Section  14(b) of the Lease is hereby  amended by (x)
deleting the text "$50,000,000"  appearing  therein,  and (y) inserting the text
"$15,000,000" in lieu thereof.

- ----------
(1) This Amendment has been executed in several counterparts.  To the extent, if
any, that this Amendment  constitutes  chattel paper (as such term is defined in
the Uniform  Commercial  Code as in effect in any applicable  jurisdiction),  no
security  interest in this  Amendment  may be created  through  the  transfer or
possession of any  counterpart  other than the original.  The  counterpart to be
deemed the original shall be the counterpart  that contains the receipt therefor
executed by Deutsche Bank Trust Company Americas,  as  Administrative  Agent, on
the  signature  page thereof and no security  interest in this  Amendment may be
created  through  the  transfer  of any  counterpart  other  than said  original
counterpart.



B. MISCELLANEOUS PROVISIONS

      1. In order to induce  the Agent to enter  into this  Amendment,  Holdings
hereby  represents  and  warrants  to each of the  Lenders  that  (i) all of the
representations  and  warranties  contained in the Lease are true and correct in
all material  respects on and as of the Second  Amendment  Effective  Date, both
before and after giving effect to this  Amendment  (unless such  representations
and  warranties   relate  to  a  specific  earlier  date,  in  which  case  such
representations  and  warranties  shall be true and  correct as of such  earlier
date),  and (ii)  there  exists no  Default  or Event of  Default  on the Second
Amendment Effective Date (as defined below), both before and after giving effect
to this Amendment.

      2. This  Amendment  is limited as  specified  and shall not  constitute  a
modification, acceptance or waiver of any other provision of the Lease.

      3. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  shall be an  original,  but all of  which  shall
together constitute one and the same instrument.  A complete set of counterparts
executed by all the parties hereto shall be lodged with Holdings and the Agent.

      4. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES  HEREUNDER
SHALL BE  CONSTRUED IN  ACCORDANCE  WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.

      5.  This  Amendment  shall  become  effective  on the  date  (the  "SECOND
AMENDMENT  EFFECTIVE  DATE") when Holdings,  Lessor,  Lessee and the Agent shall
have signed a counterpart  hereof  (whether the same or different  counterparts)
and shall have delivered (including by way of telecopier) the same to the Agent,
thereafter a counterpart of this Amendment  will be filed for  recordation  with
the Federal Aviation Administration Civil Aircraft Registry.

      6. From and after the Second  Amendment  Effective Date, all references in
the Lease and in the other  Loan  Documents  to the Lease  shall be deemed to be
referenced to the Lease as modified hereby.


                                     * * *


                                      -2-



Accepted and Agreed:

                                              ATLAS AIR WORLDWIDE HOLDINGS, INC.



                                              By: /s/ Michael L. Barna
                                                  ------------------------------
                                                  Name:  Michael L. Barna
                                                  Title: SVP & CFO

                                                                 Lease Amendment
                                                                        (N505MC)



Accepted and Agreed

                                              DEUTSCHE BANK TRUST COMPANY
                                              AMERICAS, as Agent


                                              By: /s/ Mark B. Cohen
                                                  ------------------------------
                                                  Name: Mark B. Cohen
                                                  Title: Managing Director


                                              By: /s/ Steven A. Cohen
                                                  ------------------------------
                                                  Name: Steven A. Cohen
                                                  Title: Director



                                                                         ANNEX A

1.    BOEING  747-2D3B  AIRCRAFT  WITH  SERIAL  NUMBER  21251 AND UNITED  STATES
      REGISTRATION  NUMBER  N505MC  AND FOUR  GENERAL  ELECTRIC  MODEL  CF6-50E2
      ENGINES WITH SERIAL NUMBERS 517597, 530388, 530389 AND 517599

      LEASE:

      Lease  Agreement  (N5O5MC)  dated  as of  April  25,  2000  between  Atlas
Freighter  Leasing III, Inc., as lessor,  and Atlas Air,  Inc., as lessee,  with
Lease Supplement No. 1 dated April 25, 2000 attached thereto, which was recorded
by the FAA as one  instrument  on May  24,  2000  and  assigned  Conveyance  No.
DD018944,

      as  supplemented  by Lease  Supplement No.2 dated as of November 13, 2000,
which was recorded by the FAA on December 20, 2000 and assigned  Conveyance  No.
SS016139,

      as amended by Amendment No. 1 to Lease  Agreement  dated as of October 15,
2001,  which was recorded by the FAA on January 11,2002 and assigned  Conveyance
No. SS018007,

      as amended by Amendment No. 2 to Lease  Agreement  dated as of October 30,
2001,  which was recorded by the FAA on January 9, 2002 and assigned  Conveyance
No. SS018001,

      as amended by Amendment No. 3 to Lease  Agreement dated as of December 14,
2001, which was recorded by the FAA on March 20,2002 and assigned Conveyance No.
TT016420,

      as amended by Amendment No. 4 to Aircraft Lease Agreement dated as of June
14, 2002 which was recorded by the FAA on August 21,2002 and assigned Conveyance
No. YY034495,

      as amended by Amendment  No. 5 to Lease  Agreement  dated as of August 14,
2002, which was recorded by the FAA on March 4,2003 and assigned  Conveyance No.
GG029430,

      as amended by  Amendment  No. 6 to Lease  Agreement  dated as of  December
31,2002,  which was recorded by the FAA on March 4,2003 and assigned  Conveyance
No. GG029431,

      as amended and restated by Amended and Restated Lease  Agreement  (N5O5MC)
dated as of July 27,  2004,  with Lease  Supplement  No. 1 dated  July 27,  2004
attached thereto,  which was recorded by the FAA on August 24, 2004 and assigned
Conveyance No. NN027685, and

      as amended by Amendment No. 1 to the Amended and Restated Lease  Agreement
dated as of November  30,  2004,  which was  recorded by the FAA on December 23,
2004 and assigned Conveyance No. KK034727.



This counterpart is attached to the FAA filing counterpart of Amendment No. 2 to
the Amended and Restated Lease Agreement as it creates a security interest
therein.

           AMENDMENT NO. 4 TO SECURITY AGREEMENT AND CHATTEL MORTGAGE
                            (AIRCRAFT NO. N505MC)(1)

            THIS FOURTH AMENDMENT TO THE SECURITY AGREEMENT AND CHATTEL MORTGAGE
is dated as of May 31, 2005, (this "AMENDMENT"), and entered into by and between
Atlas  Freighter  Leasing III, Inc., a Delaware  corporation  ("BORROWER"),  and
Deutsche  Bank  Trust  Company  Americas,  as agent  for and  representative  of
("ADMINISTRATIVE  AGENT") the financial  institutions  ("LENDERS")  party to the
Amended and Restated Credit Agreement referred to below.

                              W I T N E S S E T H:

            WHEREAS,  Borrower is party to that certain Credit Agreement,  dated
as of April 25,  2000,  among  Borrower,  the  Lenders  from time to time  party
thereto and the Administrative  Agent (as amended,  modified and/or supplemented
to, but not including, the date hereof, the ("CREDIT AGREEMENT").

            WHEREAS,  pursuant  to that  certain  Amended  and  Restated  Credit
Agreement,  dated as of July 27, 2004, among Borrower,  the Lenders from time to
time party thereto and the  Administrative  Agent (as amended,  modified  and/or
supplemented  from time to time, the "AMENDED AND RESTATED  CREDIT  AGREEMENT"),
Borrower has agreed to further amend and restate the Credit Agreement.

            WHEREAS,  Borrower and the Administrative  Agent are parties to that
certain  Security  Agreement  and Chattel  Mortgage  with  respect to one Boeing
747-2D3B,  U.S.  Registration  No. N5O5MC,  Manufacturer's  Serial Number 21251,
dated as of April 25, 2000, between the Borrower and the Agent,  recorded by the
Federal  Aviation  Administration  on May 24, 2000, as Conveyance No.  DD018943,
supplemented  by  Supplemental  Chattel  Mortgage No. 1 dated as of November 13,
2000,  recorded on December 20, 2000, as  Conveyance  No.  SS016138,  amended by
Amendment No. 1 to Security  Agreement and Chattel  Mortgage dated as of October
30, 2001,  recorded  January 9, 2002, as  Conveyance  No.  SS018002,  amended by
Amendment No. 2 to Aircraft Chattel Mortgage dated as of June 14, 2002, recorded
August 21, 2002,  as  Conveyance  No.  YY034496,  amended by  Amendment  No.3 to
Security  Agreement  and Chattel  Mortgage  dated as of July 27, 2004,  recorded
August 24, 2004 as Conveyance No. NN027686 (the "AIRCRAFT CHATTEL MORTGAGE").

- ----------
(1) This  Amendment  to the  Security  Agreement  and Chattel  Mortgage has been
executed in several counterparts.  To the extent, if any, that this Amendment to
the Security Agreement and Chattel Mortgage  constitutes  chattel paper (as such
term is defined in the Uniform  Commercial  Code as in effect in any  applicable
jurisdiction),  no security interest in this Amendment to the Security Agreement
and Chattel  Mortgage may be created  through the transfer or  possession of any
counterpart  other than the original.  The counterpart to be deemed the original
shall be the counterpart that contains the receipt therefor executed by Deutsche
Bank Trust Company  Americas,  as  Administrative  Agent,  on the signature page
thereof and no security interest in this Amendment to the Security Agreement and
Chattel  Mortgage any be created through the transfer of any  counterpart  other
than said original counterpart.



            WHEREAS,  subject to the terms and conditions  set forth below,  the
parties hereto wish to amend certain provisions of the Aircraft Chattel Mortgage
as provided herein.

            NOW THEREFORE, it is agreed:

A. AMENDMENT TO AIRCRAFT CHATTEL MORTGAGE

      1. The proviso to Section  4(g)(ii) of the  Aircraft  Chattel  Mortgage is
hereby amended by (x) deleting the text "$50,000,000" appearing therein, and (y)
inserting the text "$15,000,000" in lieu thereof.

B. MISCELLANEOUS PROVISIONS

      1. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  (including  by way of  facsimile  or  electronic
transmission)  shall be an original,  but all of which shall together constitute
one and the same instrument. A complete set of counterparts shall be lodged with
Borrower and the Administrative Agent.

      2. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES  HEREUNDER
SHALL BE  CONSTRUED IN  ACCORDANCE  WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.

      3. This  Amendment  is limited as  specified  and shall not  constitute  a
modification,  acceptance  or  waiver  of any other  provision  of the  Aircraft
Chattel Mortgage.

      4. From and after the date hereof,  all references in the Aircraft Chattel
Mortgage to the Aircraft  Chattel  Mortgage  shall be deemed to be references to
the Aircraft Chattel Mortgage as modified hereby.

                                      * * *


                                      -2-


            IN WITNESS WHEREOF, the undersigned have caused this Amendment to be
duly executed and delivered as of the as of the date first above written.

                                              ATLAS FREIGHTER LEASING III, INC.


                                              By: /s/ William C. Bradley
                                                  ------------------------------
                                                  Name:  William C. Bradley
                                                  Title: Treasurer & Secretary

                                                              Mortgage Amendment
                                                                        (N505MC)



                                              DEUTSCHE BANK TRUST COMPANY
                                              AMERICAS, as Agent

                                              By: /s/ Mark B. Cohen
                                                  ------------------------------
                                                  Name:  Mark B. Cohen
                                                  Title: Managing Director


                                              By: /s/ Steven A. Cohen
                                                  ------------------------------
                                                  Name:  Steven A. Cohen
                                                  Title: Director

                                                              Mortgage Amendment
                                                                        (N505MC)




                           Schedule to Exhibit 10.6.6

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
REGISTRATION         MANUFACTURER'S SERIAL    LESSEE           LESSOR                    AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
                                                                             
N509MC               21221                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N509MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N512MC               21220                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N512MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N517MC               23300                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N517MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N522MC               21783                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N522MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N523MC               21782                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N523MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N524MC               21784                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N524MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N526MC               22337                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N526MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N527MC               22471                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N527MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N528MC               22472                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N528MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N534MC               21832                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N534MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N808MC               21048                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N808MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N809MC               20887                    Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
                                                               III                       and Restated Lease (N809MC)
                                                                                         dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-50E2 Spare       530168; 517530;          Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
Engines              517790; 517602;                           III                       and Restated Lease
                     517547; 517,538;                                                    (CF6-50E2 Spare Engines)
                     517,539; 455167; 530255                                             dated as of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-80C2 BSF Spare   704,699; 704860; 704918  Atlas Air, Inc.  Atlas Freighter Leasing   Amendment No. 2 to Amended
Engines                                                        III                       and Restated Lease
                                                                                         (CF6-80C2 BSF Spare
                                                                                         Engines) dated as of May
                                                                                         31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

EX-10.6.7

                                                                  EXHIBIT 10.6.7

                                                                  EXECUTION COPY

            AMENDMENT NO 3 TO SECURITY AGREEMENT AND CHATTEL MORTGAGE
                            (AIRCRAFT NO. N505MC)(1)

            THIS THIRD AMENDMENT TO THE SECURITY AGREEMENT AND CHATTEL MORTGAGE
is dated as of July 27, 2004, (this "AMENDMENT"), and entered into by and
between Atlas Freighter Leasing III, Inc., a Delaware corporation ("BORROWER"),
and Deutsche Bank Trust Company Americas, as agent for and representative of
("ADMINISTRATIVE AGENT") the financial institutions ("LENDERS") party to the
Amended and Restated Credit Agreement referred to below.

                              W I T N E S S E T H:

            WHEREAS, Borrower is party to that certain Credit Agreement, dated
as of April 25, 2000, among Borrower, the Lenders from time to time party
thereto and the Administrative Agent (as amended, modified and/or supplemented
to, but not including, the date hereof, the "CREDIT AGREEMENT").

            WHEREAS, pursuant to that certain Amended and Restated Credit
Agreement, dated as of July 27, 2004, among Borrower, the Lenders from time to
time party thereto and the Administrative Agent (as amended, modified and/or
supplemented from time to time, the "AMENDED AND RESTATED CREDIT AGREEMENT"),
Borrower has agreed to further amend and restate the Credit Agreement.

            WHEREAS, Borrower and the Administrative Agent are parties to that
certain Security Agreement and Chattel Mortgage with respect to one Boeing
747-2D3B, U.S. Registration No. N505MC, Manufacturer's Serial No. 21251,
dated as of April 25, 2000, between the Borrower and the Agent, recorded by the
Federal Aviation Administration on May 24, 2000, as Conveyance No. DD018943,
supplemented by Supplemental Chattel Mortgage No. 1 dated as of November 13,
2000, recorded on December 20, 2000, as Conveyance No. SS016138, amended by
Amendment No. 1 to Security Agreement and Chattel Mortgage dated as of October
30, 2001, recorded January 9, 2002, as Conveyance No. SS018002, amended by
Amendment No. 2 to Aircraft Chattel Mortgage dated as of June 14, 2002, recorded
August 21, 2002, as Conveyance No. YY034496 (the "AIRCRAFT CHATTEL MORTGAGE").

- ----------
(1) This Amendment to the Security Agreement and Chattel Mortgage has been
executed in several counterparts. To the extent, if any, that this Amendment to
the Security Agreement and Chattel Mortgage constitutes chattel paper (as such
term is defined in the Uniform Commercial Code as in effect in any applicable
jurisdiction), no security interest in this Amendment to the Security Agreement
and Chattel Mortgage may be created through the transfer or possession of any
counterpart other than the original. The counterpart to be deemed the original
shall be the counterpart that contains the receipt therefor executed by Deutsche
Bank Trust Company Americas, as Administrative Agent, on the signature page
thereof and no security interest in this Amendment to the Security Agreement and
Chattel Mortgage may be created through the transfer of any counterpart other
than said original counterpart.



            WHEREAS, subject to the terms and conditions set forth below, the
parties hereto wish to amend certain provisions of the Aircraft Chattel Mortgage
as provided herein.

            NOW THEREFORE, it is agreed:

      1. The Aircraft Chattel Mortgage is hereby amended by deleting all
references to the term "Credit Agreement" and inserting the term "Amended and
Restated Credit Agreement" in lieu thereof.

      2. Section 1(a)(iii) of the Aircraft Chattel Mortgage is hereby deleted in
its entirety and the following is inserted in its place:

      "(iii) all appliances, parts, instruments, appurtenances, accessories,
furnishings and other equipment of whatever nature (other than complete Engines
or engines), that may from time to time be incorporated or installed in or
attached to the Airframe or any Engine, together with (i) all appliances, parts,
instruments, appurtenances, accessories, furnishings, other equipment purchased
or owned by Borrower and identified for incorporation or installation in or
attachment to the Airframe or any Engine pursuant to the terms of any agreement
whether or not identified in a Supplemental Chattel Mortgage and (ii) all
appliances, parts, instruments, appurtenances, accessories, furnishings and
other equipment of whatever nature subsequently removed from the Airframe or any
Engine, as the case may be, but otherwise still subject to the Lease
(collectively referred to herein as "PARTS"); and"

      3. Section 1(b) of the Aircraft Chattel Mortgage is hereby amended (x) by
deleting the text "and" from the end of clause (vii) of section 1(b), (y) by
renumbering clause (viii) of Section 1(b) as clause (ix), and (z) by inserting
the following new clause:

      "(viii) the Subsidiaries Guaranty, including without limitation all
payments of any kind thereunder, and including all rights of Borrower, as
guaranteed beneficiary, to execute any election or option or to give any notice,
consent, waiver or approval under or in respect of the Subsidiaries Guaranty, as
well as any rights, powers or remedies on the part of Borrower, whether arising
under the Subsidiaries Guaranty or by statute or at law or in equity, or
otherwise, arising out of any Lease Event of Default (as defined in the Lease)
or out of any breach of the Subsidiaries Guaranty; and"

      4. Section 2 of the Aircraft Chattel Mortgage is hereby amended by
inserting the following new defined term in the appropriate alphabetical order:

      ""AMENDED AND RESTATED CREDIT AGREEMENT" shall mean the Amended and
Restated Credit Agreement, dated as of July 27, 2004, among Borrower, the
lenders from time to time party thereto, and the Administrative Agent, as
amended, modified or supplemented from time to time."

      5. Section 2 of the Aircraft Chattel Mortgage is hereby amended by
deleting the definition of the term "Lease" in its entirety and inserting the
following defined term in its place:

      ""LEASE" means that certain Lease Agreement, dated as of April 25, 2000,
by and between Atlas Freighter Leasing III, Inc. as Lessor and Atlas Air, Inc.
as Lessee, for the lease of


                                      -2-


the Aircraft, together with any amendments, restatements, modifications,
supplements or additions thereto from time to time, including for the avoidance
of doubt, without limitation, the Amended and Restated Lease Agreement dated as
of July 27, 2004."

      6. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which counterparts
when executed and delivered (including by way of facsimile or electronic
transmission) shall be an original, but all of which shall together constitute
one and the same instrument. A complete set of counterparts shall be lodged with
Borrower and the Administrative Agent.

      7. This Amendment is limited as specified and shall not constitute a
modification, acceptance or waiver of any other provision of the Aircraft
Chattel Mortgage.

      8. From and after the date hereof, all references in the Aircraft Chattel
Mortgage to the Aircraft Chattel Mortgage shall be deemed to be references to
the Aircraft Chattel Mortgage as modified hereby.

                                    *  *  *


                                      -3-


            IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Amendment as of the date first
above written.


                                            ATLAS FREIGHTER LEASING III, INC.


                                            By: /s/ William C. Bradley
                                                --------------------------------
                                            Name: William C. Bradley
                                            Title: Treasurer and Secretary


                                                  Security Agreement and Chattel
                                                              Mortgage Amendment
                                                           (Aircraft No. N505MC)



                                            DEUTSCHE BANK TRUST COMPANY
                                            AMERICAS,
                                             as Administrative Agent


                                            By: /s/ Keith C. Braun
                                                --------------------------------
                                            Name: Keith C. Braun
                                            Title: Director


                                                  Security Agreement and Chattel
                                                              Mortgage Amendment
                                                           (Aircraft No. N505MC)




                           Schedule to Exhibit 10.6.7

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
REGISTRATION         MANUFACTURER'S SERIAL    AGENT            BORROWER                  AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
                                                                             
N509MC               21221                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N509MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N512MC               21220                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N512MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N517MC               23300                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N517MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N522MC               21783                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N522MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N523MC               21782                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N523MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N524MC               21784                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N524MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N526MC               22337                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N526MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N527MC               22471                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N527MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N528MC               22472                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N528MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N534MC               21832                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N534MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N808MC               21048                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N808MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N809MC               20887                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
                                              Trust Company    III                       Agreement (N809MC) dated as
                                              Americas                                   of July 27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-50E2 Spare       530168; 517530;          Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
Engines              517790; 517602;          Trust Company    III                       Agreement (CF6-50E2 Spare
                     517547; 517,538;         Americas                                   Engines) dated as of July
                     517,539; 455167; 530255                                             27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-80C2 BSF Spare   704,699; 704860; 704918  Deutsche Bank    Atlas Freighter Leasing   Amendment No. 3 to Security
Engines                                       Trust Company    III                       Agreement (CF6-50E2 Spare
                                              Americas                                   Engines) dated as of July
                                                                                         27, 2004
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

EX-10.6.8

                                                                  EXHIBIT 10.6.8


            AMENDMENT NO. 4 TO SECURITY AGREEMENT AND CHATTEL MORTGAGE
                            (AIRCRAFT NO. N5O5MC)(1)

            THIS FOURTH AMENDMENT TO THE SECURITY AGREEMENT AND CHATTEL MORTGAGE
is dated as of May 31, 2005, (this "AMENDMENT"), and entered into by and between
Atlas  Freighter  Leasing III, Inc., a Delaware  corporation  ("BORROWER"),  and
Deutsche  Bank  Trust  Company  Americas,  as agent  for and  representative  of
("ADMINISTRATIVE  AGENT") the financial  institutions  ("LENDERS")  party to the
Amended and Restated Credit Agreement referred to below.

                              W I T N E S S E T H;

            WHEREAS,  Borrower is party to that certain Credit Agreement,  dated
as of April 25,  2000,  among  Borrower,  the  Lenders  from time to time  party
thereto and the Administrative  Agent (as amended,  modified and/or supplemented
to, but not including, the date hereof, the "CREDIT AGREEMENT").

            WHEREAS,  pursuant  to that  certain  Amended  and  Restated  Credit
Agreement,  dated as of July 27, 2004, among Borrower,  the Lenders from time to
time party thereto and the  Administrative  Agent (as amended,  modified  and/or
supplemented  from time to time, the "AMENDED AND RESTATED  CREDIT  AGREEMENT"),
Borrower has agreed to further amend and restate the Credit Agreement.

            WHEREAS,  Borrower and the Administrative  Agent are parties to that
certain  Security  Agreement  and Chattel  Mortgage  with  respect to one Boeing
747-2D3B,  U.S.  Registration  No. N5O5MC,  Manufacturer's  Serial Number 21251,
dated as of April 25, 2000, between the Borrower and the Agent,  recorded by the
Federal  Aviation  Administration  on May 24, 2000, as Conveyance No.  DD018943,
supplemented  by  Supplemental  Chattel  Mortgage No. 1 dated as of November 13,
2000,  recorded on December 20, 2000, as  Conveyance  No.  SS016138,  amended by
Amendment No. 1 to Security  Agreement and Chattel  Mortgage dated as of October
30r20(0)l,  recorded  January 9, 2002, as Conveyance  No.  SS018002,  amended by
Amendment No. 2 to Aircraft Chattel Mortgage dated as of June 14, 2002, recorded
August 21, 2002,  as  Conveyance  No.  YY034496,  amended by Amendment  No. 3 to
Security  Agreement  and Chattel  Mortgage  dated as of July 27, 2004,  recorded
August 24, 2004 as Conveyance No. NN027686 (the "AIRCRAFT CHATTEL MORTGAGE").

- ----------
(1) This  Amendment  to the  Security  Agreement  and Chattel  Mortgage has been
executed in several counterparts.  To the extent, if any, that this Amendment to
the Security Agreement and Chattel Mortgage  constitutes  chattel paper (as such
term is defined in the Uniform  Commercial  Code as in effect in any  applicable
jurisdiction),  no security interest in this Amendment to the Security Agreement
and Chattel  Mortgage may be created  through the transfer or  possession of any
counterpart  other than the original.  The counterpart to be deemed the original
shall be the counterpart that contains the receipt therefor executed by Deutsche
Bank Trust Company  Americas,  as  Administrative  Agent,  on the signature page
thereof and no security interest in this Amendment to the Security Agreement and
Chattel  Mortgage may be created through the transfer of any  counterpart  other
than said original counterpart.



            WHEREAS,  subject to the terms and conditions  set forth below,  the
parties hereto wish to amend certain provisions of the Aircraft Chattel Mortgage
as provided herein.

            NOW THEREFORE, it is agreed:

A. AMENDMENT TO AIRCRAFT CHATTEL MORTGAGE

      1. The proviso to Section  4(g)(ii) of the  Aircraft  Chattel  Mortgage is
hereby amended by (x) deleting the text "$50,000,000" appearing therein, and (y)
inserting the text "$15,000,000" in lieu thereof.

B. MISCELLANEOUS PROVISIONS

      1. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  (including  by way of  facsimile  or  electronic
transmission)  shall be an original,  but all of which shall together constitute
one and the same instrument. A complete set of counterparts shall be lodged with
Borrower and the Administrative Agent.

      2. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES  HEREUNDER
SHALL BE  CONSTRUED IN  ACCORDANCE  WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.

      3. This  Amendment  is limited as  specified  and shall not  constitute  a
modification,  acceptance  or  waiver  of any other  provision  of the  Aircraft
Chattel Mortgage.

      4. From and after the date hereof,  all references in the Aircraft Chattel
Mortgage to the Aircraft  Chattel  Mortgage  shall be deemed to be references to
the Aircraft Chattel Mortgage as modified hereby.

                                      * * *


                                       -2-


            IN WITNESS WHEREOF, the undersigned have caused this Amendment to be
duly executed and delivered as of the date first above written.

                                              ATLAS FREIGHTER LEASING III, INC.


                                              By: /s/ William C. Bradley
                                                  ------------------------------
                                                  Name:  William C. Bradley
                                                  Title: Treasurer & Secretary

                                                              Mortgage Amendment
                                                                        (N505MC)



                                              DEUTSCHE BANK TRUST COMPANY
                                              AMERICAS, as Agent

                                              By: /s/ Mark B. Cohen
                                                  ------------------------------
                                                  Name:  Mark B. Cohen
                                                  Title: Managing Director


                                              By: /s/ Steven A. Cohen
                                                  ------------------------------
                                                  Name:  Steven A. Cohen
                                                  Title: Director

                                                              Mortgage Amendment
                                                                        (N505MC)



                           Schedule to Exhibit 10.6.8

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
REGISTRATION         MANUFACTURER'S SERIAL    AGENT            BORROWER                  AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------
                                                                             
N509MC               21221                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N509MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N512MC               21220                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N512MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N517MC               23300                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N517MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N522MC               21783                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N522MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N523MC               21782                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N523MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N524MC               21784                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N524MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N526MC               22337                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N526MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N527MC               22471                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N527MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N528MC               22472                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N528MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N534MC               21832                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N534MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N808MC               21048                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N808MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

N809MC               20887                    Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
                                              Trust Company    III                       Agreement (N809MC) dated as
                                              Americas                                   of May 31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-50E2 Spare       530168; 517530;          Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
Engines              517790; 517602;          Trust Company    III                       Agreement (CF6-50E2 Spare
                     517547; 517,538;         Americas                                   Engines) dated as of May
                     517,539; 455167; 530255                                             31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

CF6-80C2 BSF Spare   704,699; 704860; 704918  Deutsche Bank    Atlas Freighter Leasing   Amendment No. 4 to Security
Engines                                       Trust Company    III                       Agreement (CF6-50E2 Spare
                                              Americas                                   Engines) dated as of May
                                                                                         31, 2005
- -------------------- ------------------------ ---------------- ------------------------- -----------------------------

EX-10.6.9

                                                                  EXHIBIT 10.6.9


                                                                  EXECUTION COPY

                                HOLDINGS GUARANTY

================================================================================

                                    GUARANTY
                                    (N505MC)

                           Dated as of July 27, 2004

                                    given by

                       ATLAS AIR WORLDWIDE HOLDINGS, INC.

================================================================================



                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

SECTION 1. GUARANTY .......................................................   1

SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY ....................   2

SECTION 3. COVENANTS OF GUARANTOR .........................................   6
   (a)    No Assignment by Guarantor ......................................   6
   (b)    Default Under Loan Documents ....................................   6

SECTION 4. REPRESENTATIONS AND WARRANTIES OF GUARANTOR ....................   6

SECTION 5. MISCELLANEOUS ..................................................   6
   (a)    Waivers; Cumulative Effect ......................................   6
   (b)    Amendments; Waivers .............................................   6
   (c)    Severability ....................................................   6
   (d)    Counterparts ....................................................   7
   (e)    Notices .........................................................   7
   (f)    Headings, References ............................................   7
   (g)    Governing Law ...................................................   7
   (h)    Benefit and Binding Effect ......................................   7
   (i)    Service of Process; Jurisdiction and Waiver .....................   7
   (j)    Savings .........................................................   8
Annex A - Address for Notices to Guarantor

Schedule I - Description of Lease Agreement


                                HOLDINGS GUARANTY

            HOLDINGS  GUARANTY (this  "GUARANTY")  dated as of July 27, 2004, is
given by Atlas Air  Worldwide  Holdings,  Inc.  (the  "GUARANTOR"),  a  Delaware
corporation,  with respect to each and every  obligation of the Lessee under the
Amended  and  Restated  Lease  Agreement,  dated as of July 27,  2004,  and more
particularly   described  on  Schedule  I  hereto  (as   amended,   modified  or
supplemented  from time to time,  the  "Lease  Agreement")  and the  other  Loan
Documents, and is given to and for the benefit of the Lessor, the Agent, and the
Lenders  (collectively,  the  "GUARANTEED  BENEFICIARIES"  and  individually,  a
"GUARANTEED  BENEFICIARY").  All  capitalized  terms used herein  shall,  unless
otherwise  defined herein,  have the respective  meanings set forth in the Lease
Agreement.

                              W I T N E S S E T H:

            WHEREAS, as of the date hereof the Guarantor owns 100% of the issued
and outstanding capital stock of the Lessee;

            WHEREAS,  the Guarantor  entered into the Holdings Guaranty dated as
of  [August  13,  2002](1)   [October  30,  2001](2)  (the  "Original   Holdings
Guaranty"), in connection with the Existing Credit Agreement.

            WHEREAS,  it is a condition  precedent to the  effectiveness  of the
Lease  Agreement,  that the Guarantor  guarantee the  obligations  of the Lessor
under  the  Lease  Agreement  and the  other  Loan  Documents  in  favor  of the
Guaranteed  Beneficiaries  and  that  the  Guarantor  shall  have  executed  and
delivered to the Agent this Guaranty;

            WHEREAS,  the  Guarantor is entering  into this Guaranty in order to
induce the Agent and each Lender to enter into the Credit Agreement;

            WHEREAS,  the Guarantor  will obtain  benefits from Lessee  entering
into the Lease Agreement,  and accordingly,  desires to execute this Guaranty in
order to satisfy the conditions  described in the second preceding paragraph and
to  amend  and  restate  the  Original  Holdings  Guaranty  in the  form of this
Guaranty;

            NOW, THEREFORE, the Guarantor hereby agrees on behalf of and for the
benefit of the Guaranteed Beneficiaries as follows:

            SECTION 1. GUARANTY.  The Guarantor does hereby  unconditionally and
irrevocably  guarantee,  as  primary  obligor  and not  merely  as  surety,  the
following (such obligations being the "GUARANTEED OBLIGATIONS"):

            (a) to each  Guaranteed  Beneficiary,  the full and  prompt  payment
      when, where and as due, of each and every payment obligation of the Lessee
      to each such Guaranteed

- ----------
(1)   Date of Original Holdings Guaranty for Aircraft N512MC, N808MC and N809MC.

(2)   Date of Original Holding Guaranty for all other AFL III Aircraft and Spare
      Engines.



      Beneficiary  under the  Lease  Agreement  and each  other  Loan  Document,
      including, without limitation, Rent; and

            (b) to each Guaranteed  Beneficiary entitled thereto under the terms
      of any Loan Document,  the full and timely  performance  and observance by
      the Lessee of each and all other covenants and agreements not described in
      clause (a) above  required to be performed or observed by the Lessee under
      such Loan Document.

            Without  limiting the generality of the foregoing,  the  Guarantor's
liability  hereunder shall extend to all obligations that constitute part of the
Guaranteed  Obligations and would be owed by the Lessee under the Loan Documents
but for the  fact  that  they  are  unenforceable  or not  allowable  due to the
existence of a  bankruptcy,  suspension of payments,  reorganization  or similar
proceeding involving the Lessee.

            SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY.

            (a) Each and every  default  in any  payment or  performance  of any
obligation  of the Lessee under any Loan Document to which the Lessee is a party
shall give rise to a separate claim and cause of action  hereunder to the extent
that each such  default  by the Lessee  would  give rise to a separate  claim or
cause of action under the applicable Loan Document, and separate claims or suits
may be made and  brought,  as the case may be,  hereunder  as each such  default
occurs.

            (b) This Guaranty shall be a continuing,  absolute,  irrevocable and
unconditional  guaranty of payment and  performance  and not of  collection  and
shall remain in full force and effect until each and all of the  obligations  of
the  Lessee  guaranteed   hereunder  shall  have  been  fully  and  indefeasibly
discharged or performed in accordance  with the terms and provisions of the Loan
Documents (and no longer subject to  recoupment,  preference  claims or clawback
under  applicable  bankruptcy,  insolvency or similar  laws),  and the Guarantor
shall have fully  discharged  or  performed  all of its  obligations  under this
Guaranty to each Guaranteed Beneficiary.

            (c) This Guaranty and the liability of the Guarantor provided for in
Section 1 hereunder shall remain in full force and effect irrespective of:

            (i) the legality,  validity,  regularity or  enforceability,  or the
      absence  of any  thereof,  of any Loan  Document  (or  other  document  or
      agreement) or of any assignment,  amendment,  modification, or termination
      of any Loan Document (or other document or agreement) or any subleasing or
      further  subleasing  of the  Aircraft or Spare  Engines  (or any  interest
      therein or portion  thereof),  and shall in no way be affected or impaired
      by (and no notice to the  Guarantor  shall be  required in respect of) any
      compromise, waiver, settlement,  release, renewal, extension,  indulgence,
      amendment,  addition, deletion, change or modification with respect to, or
      release of any security for any of the  obligations  or liabilities of the
      Lessee under,  any Loan Document or any  redelivery,  repossession,  sale,
      transfer or other disposition, surrender or destruction of, or other event
      or  circumstance  with respect to, the  Aircraft or Spare  Engines (or any
      interest therein or portion thereof), in whole or part; or


                                      -2-


            (ii) the transfer,  assignment,  subletting,  or mortgaging,  or the
      purported transfer,  assignment,  subletting, or mortgaging, of all or any
      part of the interest of any  Guaranteed  Beneficiary  or the Lessee in the
      Aircraft or Spare Engines (or any interest  therein or portion thereof) in
      accordance with the Loan Documents; or

            (iii)  any  absence  or  defect  or  failure  of  title  or  lack of
      recordation or registration  with respect to any Guaranteed  Beneficiary's
      or the Lessee's interest in the Aircraft or Spare Engines (or any interest
      therein or portion thereof); or

            (iv) any  failure  of  delivery  of,  or loss of  perfection  of any
      security  interest  with  respect to, any portion of the Aircraft or Spare
      Engines (or any interest therein or portion thereof); or

            (v) any matter relating to any agreement or approval (or the absence
      thereof) in connection with the Aircraft or Spare Engines (or any interest
      therein or portion thereof); or

            (vi) any failure,  neglect or omission on the part of any Guaranteed
      Beneficiary  or any  other  Person  to give the  Guarantor  notice  of the
      occurrence of any Default or Lease Event of Default or Potential  Event of
      Default or Event of Default or to realize upon any collateral  held by any
      Guaranteed Beneficiary or any other Person with respect to any obligations
      or  liabilities  of the  Lessee,  or to provide for any  insurance  on the
      Aircraft or Spare Engines (or any interest therein or portion thereof), or
      to establish  or maintain a security or other  interest in the Aircraft or
      Spare  Engines  (or  any  interest  therein  or  portion  thereof)  or any
      collateral  provided  under any Loan  Document or to establish or maintain
      the priority or perfection of any thereof; or

            (vii) any defect in the compliance with  specifications,  warranties
      or any insurance policy or the condition, design, operation or fitness for
      use of, or any damage to or loss or destruction of, or any interruption or
      cessation  in the use of, the  Aircraft or Spare  Engines (or any interest
      therein or any portion  thereof) by the Lessee or any other Person for any
      reason  whatsoever  (including,   without  limitation,   any  governmental
      prohibition  or  restriction,  condemnation,  requisition,  seizure or any
      other act on the part of any  governmental or military  authority,  or any
      act of God or of the public  enemy)  regardless  of the  duration  thereof
      (even though such duration would otherwise  constitute a frustration under
      any Loan Document), whether or not without fault on the part of the Lessee
      or any other Person; or

            (viii)  any  merger,   consolidation   or  other   restructuring  or
      termination of the corporate structure, reorganization or transaction with
      respect to the Lessee or the  Guarantor  into,  with or in respect of, any
      other  Person or any sale,  lease,  assignment  or  transfer of any of the
      assets of the Lessee or Guarantor to any other Person; or

            (ix) any disposition by the Guarantor of its interest in the Lessee,
      or any  change in the  ownership  of any  shares of  capital  stock of the
      Guarantor or the Lessee,  or any change,  restructuring  or termination of
      the corporate structure or existence of the Lessee; or


                                      -3-


            (x) the  imposition  of any Tax or other charge  against the Lessee,
      the Guarantor or any other Person; or

            (xi) any exchange, release or nonperfection, or lapse of perfection,
      of any security for any  Guaranteed  Obligation  or the  acceptance of any
      security therefor; or

            (xii)  any   bankruptcy,   insolvency,   winding  up,   dissolution,
      liquidation,  receivership,  or reorganization of, or similar  proceedings
      affecting,  the Lessee or the  Guarantor  or its  assets or any  resulting
      release or discharge of any of the Guaranteed  Obligations  (except to the
      extent resulting from performance thereof); or

            (xiii) any regulatory change or other  governmental  action (whether
      or not adverse); or

            (xiv)  any  partial   payment  or   performance  of  the  Guaranteed
      Obligations  (whether as a result of the  exercise  of any right,  remedy,
      power or privilege  or  otherwise)  that is accepted or received  (except,
      subject to paragraph  (f) of this Section 2, to the extent of such payment
      or performance); or

            (xv)  any  other  occurrence  or  circumstance  whatsoever,  whether
      similar or dissimilar to the foregoing,  whether or not foreseeable,  that
      might  otherwise  constitute a legal or equitable  defense or discharge of
      the  liabilities  of a guarantor or surety or that might  otherwise  limit
      recourse against the Guarantor.

            The  obligations  of the Guarantor set forth herein  constitute  the
full recourse  obligations of the Guarantor  enforceable  against it to the full
extent of all its assets and properties.

            (d) The  obligation and liability of the Guarantor  hereunder  shall
not be impaired,  diminished,  abated or otherwise  affected (i) by any set-off,
defense or counterclaim  that the Lessee,  the Guarantor or any other Person may
have  or  claim  to  have,  at any  time or from  time to  time,  or (ii) by the
commencement by or against the Lessee,  the Guarantor or any other Person of any
proceedings  under any  bankruptcy  or  insolvency  law or laws  relating to the
relief of debtors, readjustment of indebtedness, reorganizations,  arrangements,
compositions or extension or other similar laws.

            (e) It is the intent and purpose hereof that the Guarantor shall not
be  entitled to and does  hereby  waive,  to the  fullest  extent  permitted  by
applicable law, any and all defenses available to guarantors, sureties and other
secondary  parties at law or in equity.  Without  limiting the generality of the
foregoing, the Guarantor hereby waives notice of acceptance of this Guaranty and
of the nonperformance by the Lessee, diligence,  presentment, protest, dishonor,
demand for payment from the Lessee or any other Person and notice of  nonpayment
or  failure  to  perform  on the  part  of the  Lessee  and  all  other  notices
whatsoever.  The guaranty  hereunder is a guaranty of payment,  performance  and
compliance and not of  collectability  only. The Guarantor  specifically  agrees
that it shall not be necessary,  and the Guarantor shall not require,  before or
as a condition of enforcing the  liability of the Guarantor  under this Guaranty
or  requiring  payment  or  performance  of the  Guaranteed  Obligations  by the
Guarantor  hereunder,  or at any time  thereafter,  that  any of the  Guaranteed
Beneficiaries  (i) file suit or proceed to obtain or assert a claim for personal
judgment  against any Person that may be liable for any  Guaranteed  Obligation;
(ii) make any other effort to


                                      -4-


obtain payment or performance  of any Guaranteed  Obligation  from the Lessee or
any  other  Person  that may be liable  for such  Guaranteed  Obligation;  (iii)
foreclose against or seek to realize upon any security now or hereafter existing
for such  Guaranteed  Obligation;  (iv)  exercise  or assert any other  right or
remedy to which any of the  Guaranteed  Beneficiaries  is or may be  entitled in
connection  with any  Guaranteed  Obligation  or any security or other  guaranty
therefor;  (v) assert or file any claim  against the assets of the Lessee or any
other Person liable for any  Guaranteed  Obligation;  or (vi) join the Lessee or
any  other  Person  as a party  to any  proceeding  for the  enforcement  of any
provision of this Guaranty.  Without  limiting the  foregoing,  it is understood
that  repeated  and  successive  demands may be made and  recoveries  may be had
hereunder as and when,  from time to time,  a Lease Event of Default  shall have
occurred and be continuing or a Guaranteed  Obligation shall otherwise arise (in
either case, a "RECOVERY EVENT"), and that,  notwithstanding  recovery hereunder
for or in respect of any such  Recovery  Event,  this  Guaranty  shall remain in
force and effect and shall apply to each and every  subsequent  Recovery  Event.
The  Guarantor  further  agrees that,  without  limiting the  generality of this
Guaranty,  if any Recovery  Event shall have occurred and be continuing  and any
Guaranteed  Beneficiary (or any assignee thereof) is prevented by applicable law
from  exercising its remedies under any applicable Loan Document for any reason,
such  Guaranteed  Beneficiary  (or any  assignee  thereof)  shall be entitled to
receive  hereunder  from the  Guarantor,  upon  demand  therefor,  the sums that
otherwise  would have been due from the Lessee had such remedies been exercised.
If the  Guarantor  makes any payment or performs  any  obligation  hereunder  in
respect of any of the  obligations to be performed by the Lessee,  the Guarantor
shall  become  subrogated  to the extent of such payment or  performance  to the
rights of the Guaranteed  Beneficiary under the relevant  agreement to which the
Lessee is a party  against  the Lessee in respect  of such  obligations  and any
collateral  security or guaranty  held by or for the benefit of such  Guaranteed
Beneficiary for the payment of such obligations;  PROVIDED,  HOWEVER,  that such
rights of subrogation  shall not commence until such time  subsequent to the end
of the Term as the Lessee or the Guarantor,  as the case may be, shall have paid
and  performed  each  and  every   Guaranteed   Obligation  to  each  Guaranteed
Beneficiary  and the  Guarantor  shall  have  fully  performed  its  obligations
hereunder.

            (f) The guaranty  hereunder  shall not be deemed to have  terminated
and shall  continue to be effective  (or if  terminated  for any reason shall be
reinstated, as the case may be), if at any time payment, or any part thereof, of
any of the  obligations  hereunder or under any Loan  Document is rescinded  and
must be (and actually is) returned by any  Guaranteed  Beneficiary to the Person
who  made  the  payment  or on  behalf  of whom the  payment  was made  upon the
insolvency,  bankruptcy or reorganization (or similar event) with respect to the
Lessee,  the  Guarantor  or  otherwise,  all as though such payment had not been
made.

            (g) If the Guarantor  fails to pay any amount  hereunder when due to
any  Guaranteed  Beneficiary,   the  Guarantor  shall  pay  to  such  Guaranteed
Beneficiary  interest,  on  demand,  on  such  amount  at the  appropriate  rate
described in Section 2.2D of the Credit Agreement.

            (h)  The  Guarantor   further  agrees  to  pay  to  each  Guaranteed
Beneficiary  any and all costs and  expenses,  including  reasonable  legal fees
(which shall include  allocated  costs of internal  counsel) and  disbursements,
incurred  by such party in  connection  with  enforcing  its  rights  under this
Guaranty.


                                      -5-


            SECTION 3. COVENANTS OF GUARANTOR.  The Guarantor  hereby  covenants
for the benefit of each Guaranteed Beneficiary as follows:

            (a) NO  ASSIGNMENT  BY  GUARANTOR.  Except  as  expressly  permitted
herein,  the  Guarantor  agrees  that it shall not  assign  any of its rights or
obligations  hereunder  without the prior  written  consent of the  Lessor,  the
Agent, and the Requisite  Lenders.  The Guarantor  acknowledges  that the Lessor
intends to mortgage,  grant,  and assign all of the Lessor's right,  title,  and
interest in and to this Guaranty and the  Guarantor's  obligations  hereunder to
the Agent, as administrative  agent for and  representative  of the Lenders,  as
security  for the  Secured  Obligations  (as  defined in the  relevant  Aircraft
Chattel  Mortgage),  and the Guarantor hereby consents to such mortgage,  grant,
and assignment.

            (b) DEFAULT UNDER LOAN DOCUMENTS. The Guarantor agrees that it shall
not take any  action or fail to take any action  that  would  cause a Default or
Lease Event of Default under any Lease or a Potential  Event of Default or Event
of Default under any of the other Loan Documents.

            SECTION  4.   REPRESENTATIONS  AND  WARRANTIES  OF  GUARANTOR.   The
Guarantor  makes,  for the benefit of each Guaranteed  Beneficiary,  each of the
representations  and warranties  made in the Lease Agreement by the Guarantor as
to its assets,  financial  condition,  operations,  organization,  legal status,
business, and the Loan Documents to which it is a party.

            SECTION 5. MISCELLANEOUS.

            (a)  WAIVERS;   CUMULATIVE   EFFECT.  A  waiver  by  any  Guaranteed
Beneficiary  of any right or remedy  hereunder on any one occasion  shall not be
construed as a bar to any right or remedy that such  Guaranteed  Beneficiary (or
any  other  Guaranteed  Beneficiary)  would  otherwise  have  had on any  future
occasion with regard to any  subsequent  breach.  No failure to exercise nor any
delay in exercising on the part of any Guaranteed  Beneficiary any right, power,
or privilege hereunder,  shall operate as a waiver thereof; nor shall any single
or partial  exercise of any right,  power, or privilege  hereunder  preclude any
other or further exercise thereof or the exercise of any other right,  power, or
privilege.  The rights and remedies  herein  provided are  cumulative and may be
exercised  singularly or  concurrently,  and are not exclusive of any rights and
remedies provided by law or by the Lease Agreement or the other Loan Documents.

            (b)  AMENDMENTS;  WAIVERS.  This  Guaranty  may  not be  terminated,
amended,  supplemented,  waived,  or  modified  orally,  but may be  terminated,
amended, supplemented, waived, or modified upon the prior written consent of the
Guarantor, the Lessor, the Agent, and the Requisite Lenders.

            (c) SEVERABILITY.  Any provision of this Guaranty that is prohibited
or  unenforceable  in  any  jurisdiction  shall,  as to  such  jurisdiction,  be
ineffective  to the  extent  of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.


                                      -6-


            (d)  COUNTERPARTS.  This  Guaranty  may be  executed  by the parties
hereto in separate  counterparts,  each of which when so executed and  delivered
shall be an original,  but all such counterparts  shall together  constitute but
one and the same instrument.

            (e) NOTICES.  Any notice to the Guarantor  hereunder may be directed
to the  Guarantor at its address set forth in Annex A, or to such other  address
as the Guarantor may designate by notice given to the other parties hereto.

            (f) HEADINGS, REFERENCES. The section and paragraph headings in this
Guaranty are for  convenience  of reference  only and shall not modify,  define,
expand or limit any of the terms or provisions hereof.

            (g) GOVERNING  LAW.  THIS GUARANTY  SHALL BE GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK, EXCLUDING (TO THE GREATEST EXTENT PERMISSIBLE BY LAW) ANY
RULE OF LAW THAT WOULD  CAUSE THE  APPLICATION  OF THE LAWS OF ANY  JURISDICTION
OTHER THAN THE STATE OF NEW YORK.  THIS GUARANTY HAS BEEN DELIVERED IN THE STATE
OF NEW YORK.

            (h) BENEFIT AND BINDING EFFECT.  The terms of this Guaranty shall be
binding  upon the  Guarantor,  and shall inure to the benefit of the  Guarantor,
each  Guaranteed  Beneficiary,  and their  respective  successors  and permitted
assigns (to the extent permitted hereunder and under the Loan Documents).

            (i) SERVICE OF PROCESS;  JURISDICTION AND WAIVER.  The Guarantor (A)
hereby irrevocably  submits to the nonexclusive  jurisdiction of (i) the Supreme
Court of the State of New York, New York County (without  prejudice to the right
of any party to remove to the  United  States  District  Court for the  Southern
District of New York) and (ii) the United States District Court for the Southern
District of New York for the purposes of any suit,  action,  or other proceeding
arising  out of this  Guaranty  or the  subject  matter  hereof  brought  by any
Guaranteed  Beneficiary  or its  successors  or  permitted  assigns,  (B) hereby
irrevocably agrees that all claims in respect of such suit, action or proceeding
may be heard and  determined  in such New York  State  court or, to the  fullest
extent permitted by applicable law, in such Federal court, and (C) to the extent
permitted  by  applicable  law,  hereby  irrevocably  waives,  and agrees not to
assert, by way of motion, as a defense, or otherwise,  in any such suit, action,
or proceeding any claim that it is not personally subject to the jurisdiction of
the above-named  courts,  that the suit,  action, or proceeding is brought in an
inconvenient  forum,  that the  venue of the  suit,  action,  or  proceeding  is
improper, or that this Guaranty or the subject matter hereof may not be enforced
in or by such court.  THE  GUARANTOR  WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY
SUIT,  ACTION,  PROCEEDING,  OR COUNTERCLAIM  ARISING OUT OF OR RELATING TO THIS
GUARANTY.  A  final  judgment  obtained  in  respect  of any  suit,  action,  or
proceeding  referred  to in this  Section  5(i) shall be  conclusive  and may be
enforced  in other  jurisdictions  by suit on the  judgment  or in any manner as
provided by applicable law. The Guarantor  hereby consents to service of process
in connection  with the subject  matter  specified in the first sentence of this
Section 5(i) in connection with the  above-mentioned  courts by registered mail,
FedEx,  DHL, or similar  courier at the address to which notices to it are to be
given as provided in Annex A hereto, it being agreed that service in such manner
shall constitute valid service upon


                                      -7-


the Guarantor and its successors  and assigns in connection  with any such suit,
action, or proceeding only; PROVIDED, HOWEVER, that nothing in this Section 5(i)
shall  affect  the  right  of any  of  the  Guaranteed  Beneficiaries  or  their
successors  or assigns to serve legal  process in any other matter  permitted by
law  or  affect  the  right  of any of the  Guaranteed  Beneficiaries  or  their
successors  or assigns to bring any suit,  action,  or  proceeding  against  the
Guarantor or its properties in the courts of other jurisdictions.

            (j) SAVINGS.  Each Guaranteed  Beneficiary (by its acceptance of the
benefits hereof) and the Guarantor hereby confirms that it is its intention that
this Guaranty not constitute a fraudulent transfer or conveyance for purposes of
the Bankruptcy Code, the Uniform Fraudulent  Transfer Act or any similar federal
or state law. To effectuate the foregoing intention, each Guaranteed Beneficiary
and the Guarantor  hereby  irrevocably  agrees that the  Guaranteed  Obligations
guaranteed by the Guarantor  under this Guaranty shall be limited to such amount
as will,  after giving effect to such maximum amount and all of the  Guarantor's
other  (contingent or otherwise)  liabilities  that are relevant under such laws
(but  excluding,  to  the  maximum  extent  permitted  by  applicable  law,  any
liabilities of the Guarantor arising under any indebtedness that is subordinated
to the Guaranteed Obligations or any obligations under this Guaranty), result in
the  Guaranteed  Obligations  of the Guarantor in respect of such maximum amount
not constituting a fraudulent transfer or conveyance.

                                   * * * * *


                                      -8-


            IN WITNESS  WHEREOF,  the  Guarantor  has caused this Guaranty to be
executed  as of the day and year  first  written  above for the  benefit  of the
parties named herein.

                                           ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer



                                                                         ANNEX A

                        ADDRESS FOR NOTICES TO GUARANTOR

ATLAS AIR WORLDWIDE HOLDINGS, INC.

2000 Westchester Avenue
Purchase, New York 10577-2543

Attention: Treasurer/Corporate Finance



                                                                      SCHEDULE I

      Lease Agreement, dated as of April 25, 2000 and amended and restated as of
July 27,  2004,  between the Lessor and the  Lessee,  as  supplemented  by Lease
Supplement No. 1, dated as of July 27, 2004, which were recorded together as one
instrument by the Federal Aviation  Administration (the "FAA") on July 27, 2004,
as Conveyance No. [__________].


                                      (i)




                           Schedule to Exhibit 10.6.9

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ------------------------- -----------------------------------------
REGISTRATION         MANUFACTURER'S SERIAL    GUARANTOR                 AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ------------------------- -----------------------------------------
                                                               
N509MC               21221                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N512MC               21220                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N517MC               23300                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N522MC               21783                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N523MC               21782                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N524MC               21784                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N526MC               22337                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N527MC               22471                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N528MC               22472                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N534MC               21832                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N808MC               21048                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
N809MC               20887                    Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
                                              Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------
CF6-50E2 Spare       530168; 517530;          Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
Engines              517790; 517602;          Holdings, Inc.            2004
                     517547; 517,538;
                     517,539; 455167; 530255
- -------------------- ------------------------ ------------------------- -----------------------------------------
CF6-80C2 BSF Spare   704,699; 704860; 704918  Atlas Air Worldwide       Holdings Guaranty dated as of July 27,
Engines                                       Holdings, Inc.            2004
- -------------------- ------------------------ ------------------------- -----------------------------------------

EX-10.6.10

                                                                 EXHIBIT 10.6.10

                                                                  EXECUTION COPY

                              SUBSIDIARIES GUARANTY

================================================================================

                                    GUARANTY
                                    (N505MC)

                            Dated as of July 27, 2004

                                    given by

           CERTAIN SUBSIDIARIES OF ATLAS AIR WORLDWIDE HOLDINGS, INC.

================================================================================



                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

SECTION 1. GUARANTY .......................................................   1

SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY ....................   2

SECTION 3. COVENANTS OF THE GUARANTORS ....................................   5
   (a)     No Assignment by Guarantor .....................................   5
   (b)     Default Under Loan Documents ...................................   6

SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE GUARANTORS ...............   6

SECTION 5. MISCELLANEOUS ..................................................   6
   (a)     Waivers; Cumulative Effect .....................................   6
   (b)     Amendments; Waivers ............................................   6
   (c)     Severability ...................................................   6
   (d)     Counterparts ...................................................   6
   (e)     Notices ........................................................   6
   (f)     Headings, References ...........................................   7
   (g)     Governing Law ..................................................   7
   (h)     Benefit and Binding Effect .....................................   7
   (i)     Service of Process; Jurisdiction and Waiver ....................   7
   (j)     Savings ........................................................   8

Annex A - Address for Notices to Guarantor

Schedule I - Description of Lease Agreement



                             SUBSIDIARIES GUARANTY

            SUBSIDIARIES  GUARANTY (this  "GUARANTY") dated as of July 27, 2004,
is  given  by  each of the  undersigned  subsidiaries  of  Atlas  Air  Worldwide
Holdings,  Inc. (each a "GUARANTOR" and collectively,  the  "GUARANTORS"),  with
respect  to each and  every  obligation  of the  Lessee  under the  Amended  and
Restated  Lease  Agreement,  dated as of July 27,  2004,  and more  particularly
described on Schedule I hereto (as amended,  modified or supplemented  from time
to time, the "Lease  Agreement") and the other Loan  Documents,  and is given to
and for the benefit of the Lessor, the Agent, and the Lenders (collectively, the
"GUARANTEED BENEFICIARIES" and individually,  a "GUARANTEED  BENEFICIARY").  All
capitalized terms used herein shall,  unless otherwise defined herein,  have the
respective meanings set forth in the Lease Agreement.

                              W I T N E S S E T H:

            WHEREAS,  it is a condition  precedent to the  effectiveness  of the
Lease  Agreement,  that each Guarantor  guarantee the  obligations of the Lessor
under  the  Lease  Agreement  and the  other  Loan  Documents  in  favor  of the
Guaranteed  Beneficiaries  and that  each  Guarantor  shall  have  executed  and
delivered to the Agent this Guaranty;

            WHEREAS,  each  Guarantor is entering into this Guaranty in order to
induce the Agent and each Lender to enter into the Credit Agreement;

            WHEREAS,  each Guarantor will obtain  benefits from Lessee  entering
into the Lease Agreement,  and accordingly,  desires to execute this Guaranty to
satisfy the conditions described in the preceding paragraph;

            NOW,  THEREFORE,  each Guarantor  hereby agrees on behalf of and for
the benefit of the Guaranteed Beneficiaries as follows:

            SECTION 1. GUARANTY.  Each Guarantor does hereby unconditionally and
irrevocably jointly and severally  guarantee,  as primary obligor and not merely
as surety, the following (such obligations being the "GUARANTEED OBLIGATIONS"):

            (a) to each  Guaranteed  Beneficiary,  the full and  prompt  payment
      when, where and as due, of each and every payment obligation of the Lessee
      to each such  Guaranteed  Beneficiary  under the Lease  Agreement and each
      other Loan Document, including, without limitation, Rent; and

            (b) to each Guaranteed  Beneficiary entitled thereto under the terms
      of any Loan Document,  the full and timely  performance  and observance by
      the Lessee of each and all other covenants and agreements not described in
      clause (a) above  required to be performed or observed by the Lessee under
      such Loan Document.

            Without  limiting the generality of the foregoing,  each Guarantor's
liability  hereunder shall extend to all obligations that constitute part of the
Guaranteed  Obligations and would be owed by the Lessee under the Loan Documents
but for the fact that they are



unenforceable or not allowable due to the existence of a bankruptcy,  suspension
of payments, reorganization or similar proceeding involving the Lessee.

            SECTION 2. GENERAL PROVISIONS RELATING TO THE GUARANTY.

            (a) Each and every  default  in any  payment or  performance  of any
obligation  of the Lessee under any Loan Document to which the Lessee is a party
shall give rise to a separate claim and cause of action  hereunder to the extent
that each such  default  by the Lessee  would  give rise to a separate  claim or
cause of action under the applicable Loan Document, and separate claims or suits
may be made and  brought,  as the case may be,  hereunder  as each such  default
occurs.

            (b) This Guaranty shall be a continuing,  absolute,  irrevocable and
unconditional  guaranty of payment and  performance  and not of  collection  and
shall remain in full force and effect until each and all of the  obligations  of
the  Lessee  guaranteed   hereunder  shall  have  been  fully  and  indefeasibly
discharged or performed in accordance  with the terms and provisions of the Loan
Documents (and no longer subject to  recoupment,  preference  claims or clawback
under  applicable  bankruptcy,  insolvency or similar laws),  and each Guarantor
shall have fully  discharged  or  performed  all of its  obligations  under this
Guaranty to each Guaranteed Beneficiary.

            (c) This Guaranty and the liability of the  Guarantors  provided for
in Section 1 hereunder shall remain in full force and effect irrespective of:

            (i) the legality,  validity,  regularity or  enforceability,  or the
      absence  of any  thereof,  of any Loan  Document  (or  other  document  or
      agreement) or of any assignment,  amendment,  modification, or termination
      of any Loan Document (or other document or agreement) or any subleasing or
      further  subleasing  of the  Aircraft or Spare  Engines  (or any  interest
      therein or portion  thereof),  and shall in no way be affected or impaired
      by (and no notice to the  Guarantors  shall be required in respect of) any
      compromise, waiver, settlement,  release, renewal, extension,  indulgence,
      amendment,  addition, deletion, change or modification with respect to, or
      release of any security for any of the  obligations  or liabilities of the
      Lessee under,  any Loan Document or any  redelivery,  repossession,  sale,
      transfer or other disposition, surrender or destruction of, or other event
      or  circumstance  with respect to, the  Aircraft or Spare  Engines (or any
      interest therein or portion thereof), in whole or part; or

            (ii) the transfer,  assignment,  subletting,  or mortgaging,  or the
      purported transfer,  assignment,  subletting, or mortgaging, of all or any
      part of the interest of any  Guaranteed  Beneficiary  or the Lessee in the
      Aircraft or Spare Engines (or any interest  therein or portion thereof) in
      accordance with the Loan Documents; or

            (iii)  any  absence  or  defect  or  failure  of  title  or  lack of
      recordation or registration  with respect to any Guaranteed  Beneficiary's
      or the Lessee's interest in the Aircraft or Spare Engines (or any interest
      therein or portion thereof); or


                                      -2-


            (iv) any  failure  of  delivery  of,  or loss of  perfection  of any
      security  interest  with  respect to, any portion of the Aircraft or Spare
      Engines (or any interest therein or portion thereof); or

            (v) any matter relating to any agreement or approval (or the absence
      thereof) in connection with the Aircraft or Spare Engines (or any interest
      therein or portion thereof); or

            (vi) any failure,  neglect or omission on the part of any Guaranteed
      Beneficiary  or any  other  Person  to give the  Guarantors  notice of the
      occurrence of any Default or Lease Event of Default or Potential  Event of
      Default or Event of Default or to realize upon any collateral  held by any
      Guaranteed Beneficiary or any other Person with respect to any obligations
      or  liabilities  of the  Lessee,  or to provide for any  insurance  on the
      Aircraft or Spare Engines (or any interest therein or portion thereof), or
      to establish  or maintain a security or other  interest in the Aircraft or
      Spare  Engines  (or  any  interest  therein  or  portion  thereof)  or any
      collateral  provided  under any Loan  Document or to establish or maintain
      the priority or perfection of any thereof; or

            (vii) any defect in the compliance with  specifications,  warranties
      or any insurance policy or the condition, design, operation or fitness for
      use of, or any damage to or loss or destruction of, or any interruption or
      cessation  in the use of, the  Aircraft or Spare  Engines (or any interest
      therein or any portion  thereof) by the Lessee or any other Person for any
      reason  whatsoever  (including,   without  limitation,   any  governmental
      prohibition  or  restriction,  condemnation,  requisition,  seizure or any
      other act on the part of any  governmental or military  authority,  or any
      act of God or of the public  enemy)  regardless  of the  duration  thereof
      (even though such duration would otherwise  constitute a frustration under
      any Loan Document), whether or not without fault on the part of the Lessee
      or any other Person; or

            (viii)  any  merger,   consolidation   or  other   restructuring  or
      termination of the corporate structure, reorganization or transaction with
      respect to the Lessee or any  Guarantor  into,  with or in respect of, any
      other  Person or any sale,  lease,  assignment  or  transfer of any of the
      assets of the Lessee or any Guarantor to any other Person; or

            (ix) any disposition by any Guarantor of its interest in the Lessee,
      or any change in the  ownership  of any  shares of  capital  stock of such
      Guarantor or the Lessee,  or any change,  restructuring  or termination of
      the corporate structure or existence of the Lessee; or

            (x) the  imposition  of any Tax or other charge  against the Lessee,
      any Guarantor or any other Person; or

            (xi) any exchange, release or nonperfection, or lapse of perfection,
      of any security for any  Guaranteed  Obligation  or the  acceptance of any
      security therefor; or

            (xii)  any   bankruptcy,   insolvency,   winding  up,   dissolution,
      liquidation,  receivership,  or reorganization of, or similar  proceedings
      affecting,  the Lessee or any  Guarantor  or its  assets or any  resulting
      release or discharge of any of the Guaranteed  Obligations  (except to the
      extent resulting from performance thereof); or


                                      -3-


            (xiii) any regulatory change or other  governmental  action (whether
      or not adverse); or

            (xiv)  any  partial   payment  or   performance  of  the  Guaranteed
      Obligations  (whether as a result of the  exercise  of any right,  remedy,
      power or privilege  or  otherwise)  that is accepted or received  (except,
      subject to paragraph  (f) of this Section 2, to the extent of such payment
      or performance); or

            (xv)  any  other  occurrence  or  circumstance  whatsoever,  whether
      similar or dissimilar to the foregoing,  whether or not foreseeable,  that
      might  otherwise  constitute a legal or equitable  defense or discharge of
      the  liabilities  of a Guarantor or surety or that might  otherwise  limit
      recourse against such Guarantor.

            The  obligations of each  Guarantor set forth herein  constitute the
full recourse  obligations of each Guarantor  enforceable against it to the full
extent of all its assets and properties.

            (d) The obligation and liability of each Guarantor  hereunder  shall
not be impaired,  diminished,  abated or otherwise  affected (i) by any set-off,
defense or counterclaim  that the Lessee,  any Guarantor or any other Person may
have  or  claim  to  have,  at any  time or from  time to  time,  or (ii) by the
commencement by or against the Lessee,  any Guarantor or any other Person of any
proceedings  under any  bankruptcy  or  insolvency  law or laws  relating to the
relief of debtors, readjustment of indebtedness, reorganizations,  arrangements,
compositions or extension or other similar laws.

            (e) It is the intent and purpose  hereof that each  Guarantor  shall
not be entitled to and does hereby  waive,  to the fullest  extent  permitted by
applicable law, any and all defenses  available to such Guarantor,  sureties and
other secondary parties at law or in equity.  Without limiting the generality of
the  foregoing,  each  Guarantor  hereby  waives  notice of  acceptance  of this
Guaranty  and  of the  nonperformance  by the  Lessee,  diligence,  presentment,
protest,  dishonor,  demand for payment  from the Lessee or any other Person and
notice of  nonpayment  or  failure  to perform on the part of the Lessee and all
other  notices  whatsoever.  The  guaranty  hereunder  is a guaranty of payment,
performance  and  compliance  and not of  collectability  only.  Each  Guarantor
specifically agrees that it shall not be necessary, and such Guarantor shall not
require,  before or as a condition of enforcing the liability of such  Guarantor
under this  Guaranty  or  requiring  payment or  performance  of the  Guaranteed
Obligations by such Guarantor hereunder, or at any time thereafter,  that any of
the  Guaranteed  Beneficiaries  (i) file suit or  proceed  to obtain or assert a
claim for  personal  judgment  against  any  Person  that may be liable  for any
Guaranteed  Obligation;  (ii)  make  any  other  effort  to  obtain  payment  or
performance  of any  Guaranteed  Obligation  from the Lessee or any other Person
that may be liable for such Guaranteed  Obligation;  (iii) foreclose  against or
seek to realize upon any security now or hereafter  existing for such Guaranteed
Obligation;  (iv)  exercise  or assert any other right or remedy to which any of
the  Guaranteed  Beneficiaries  is or may be  entitled  in  connection  with any
Guaranteed Obligation or any security or other guaranty therefor;  (v) assert or
file any claim  against the assets of the Lessee or any other Person  liable for
any  Guaranteed  Obligation;  or (vi) join the  Lessee or any other  Person as a
party to any proceeding  for the  enforcement of any provision of this Guaranty.
Without  limiting the foregoing,  it is understood  that repeated and successive
demands may be made and recoveries  may be had hereunder as and when,  from time
to time, a Lease Event of Default shall have occurred and


                                      -4-


be continuing or a Guaranteed  Obligation shall otherwise arise (in either case,
a "RECOVERY  EVENT"),  and that,  notwithstanding  recovery  hereunder for or in
respect of any such  Recovery  Event,  this  Guaranty  shall remain in force and
effect  and  shall  apply to each and  every  subsequent  Recovery  Event.  Each
Guarantor further agrees that, without limiting the generality of this Guaranty,
if any Recovery  Event shall have occurred and be continuing  and any Guaranteed
Beneficiary  (or any  assignee  thereof) is  prevented  by  applicable  law from
exercising its remedies under any applicable Loan Document for any reason,  such
Guaranteed  Beneficiary  (or any assignee  thereof) shall be entitled to receive
hereunder from such  Guarantor,  upon demand  therefor,  the sums that otherwise
would have been due from the Lessee had such  remedies  been  exercised.  If any
Guarantor  makes any payment or performs any obligation  hereunder in respect of
any of the  obligations  to be performed  by the Lessee,  such  Guarantor  shall
become  subrogated to the extent of such payment or performance to the rights of
the Guaranteed Beneficiary under the relevant agreement to which the Lessee is a
party  against  the  Lessee in respect of such  obligations  and any  collateral
security or guaranty held by or for the benefit of such  Guaranteed  Beneficiary
for the  payment of such  obligations;  PROVIDED,  HOWEVER,  that such rights of
subrogation shall not commence until such time subsequent to the end of the Term
as the  Lessee  or such  Guarantor,  as the case  may be,  shall  have  paid and
performed each and every  Guaranteed  Obligation to each Guaranteed  Beneficiary
and such Guarantor shall have fully performed its obligations hereunder.

            (f) The guaranty  hereunder  shall not be deemed to have  terminated
and shall  continue to be effective  (or if  terminated  for any reason shall be
reinstated, as the case may be), if at any time payment, or any part thereof, of
any of the  obligations  hereunder or under any Loan  Document is rescinded  and
must be (and actually is) returned by any  Guaranteed  Beneficiary to the Person
who  made  the  payment  or on  behalf  of whom the  payment  was made  upon the
insolvency,  bankruptcy or reorganization (or similar event) with respect to the
Lessee,  any  Guarantor  or  otherwise,  all as though such payment had not been
made.

            (g) If any Guarantor  fails to pay any amount  hereunder when due to
any  Guaranteed  Beneficiary,  such  Guarantor  shall  pay  to  such  Guaranteed
Beneficiary  interest,  on  demand,  on  such  amount  at the  appropriate  rate
described in Section 2.2D of the Credit Agreement.

            (h)  Each  Guarantor  further  agrees  to  pay  to  each  Guaranteed
Beneficiary  any and all costs and  expenses,  including  reasonable  legal fees
(which shall include  allocated  costs of internal  counsel) and  disbursements,
incurred  by such party in  connection  with  enforcing  its  rights  under this
Guaranty.

            SECTION  3.  COVENANTS  OF THE  GUARANTORS.  Each  Guarantor  hereby
covenants for the benefit of each Guaranteed Beneficiary as follows:

            (a) NO  ASSIGNMENT  BY  GUARANTOR.  Except  as  expressly  permitted
herein,  each  Guarantor  agrees  that it shall not  assign any of its rights or
obligations  hereunder  without the prior  written  consent of the  Lessor,  the
Agent, and the Requisite  Lenders.  Each Guarantor  acknowledges that the Lessor
intends to mortgage,  grant,  and assign all of the Lessor's right,  title,  and
interest in and to this Guaranty and such Guarantor's  obligations  hereunder to
the Agent, as administrative  agent for and  representative  of the Lenders,  as
security for the Secured


                                      -5-


Obligations (as defined in the relevant  Aircraft  Chattel  Mortgage),  and each
Guarantor hereby consents to such mortgage, grant, and assignment.

            (b) DEFAULT  UNDER LOAN  DOCUMENTS.  Each  Guarantor  agrees that it
shall not take any action or fail to take any action  that would cause a Default
or Lease  Event of Default  under any Lease or a  Potential  Event of Default or
Event of Default under any of the other Loan Documents.

            SECTION 4.  REPRESENTATIONS  AND WARRANTIES OF THE GUARANTORS.  Each
Guarantor  makes,  for the benefit of each Guaranteed  Beneficiary,  each of the
representations  and warranties made in the Lease Agreement by each Guarantor as
to its assets,  financial  condition,  operations,  organization,  legal status,
business,   and  the  Loan  Documents  to  which  it  is  a  party.

            SECTION 5. MISCELLANEOUS.

            (a)  WAIVERS;   CUMULATIVE   EFFECT.  A  waiver  by  any  Guaranteed
Beneficiary  of any right or remedy  hereunder on any one occasion  shall not be
construed as a bar to any right or remedy that such  Guaranteed  Beneficiary (or
any  other  Guaranteed  Beneficiary)  would  otherwise  have  had on any  future
occasion with regard to any  subsequent  breach.  No failure to exercise nor any
delay in exercising on the part of any Guaranteed  Beneficiary any right, power,
or privilege hereunder,  shall operate as a waiver thereof; nor shall any single
or partial  exercise of any right,  power, or privilege  hereunder  preclude any
other or further exercise thereof or the exercise of any other right,  power, or
privilege.  The rights and remedies  herein  provided are  cumulative and may be
exercised  singularly or  concurrently,  and are not exclusive of any rights and
remedies provided by law or by the Lease Agreement or the other Loan Documents.

            (b)  AMENDMENTS;  WAIVERS.  This  Guaranty  may  not be  terminated,
amended,  supplemented,  waived,  or  modified  orally,  but may be  terminated,
amended,  supplemented,  waived,  or modified upon the prior written  consent of
each Guarantor, the Lessor, the Agent, and the Requisite Lenders.

            (c) SEVERABILITY.  Any provision of this Guaranty that is prohibited
or  unenforceable  in  any  jurisdiction  shall,  as to  such  jurisdiction,  be
ineffective  to the  extent  of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

            (d)  COUNTERPARTS.  This  Guaranty  may be  executed  by the parties
hereto in separate  counterparts,  each of which when so executed and  delivered
shall be an original,  but all such counterparts  shall together  constitute but
one and the same instrument.

            (e) NOTICES.  Any notice to the Guarantors hereunder may be directed
to each  Guarantor at its address set forth in Annex A, or to such other address
as each Guarantor may designate by notice given to the other parties hereto.


                                      -6-


            (f) HEADINGS, REFERENCES. The section and paragraph headings in this
Guaranty are for  convenience  of reference  only and shall not modify,  define,
expand or limit any of the terms or provisions hereof.

            (g) GOVERNING  LAW.  THIS GUARANTY  SHALL BE GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK, EXCLUDING (TO THE GREATEST EXTENT PERMISSIBLE BY LAW) ANY
RULE OF LAW THAT WOULD  CAUSE THE  APPLICATION  OF THE LAWS OF ANY  JURISDICTION
OTHER THAN THE STATE OF NEW YORK.  THIS GUARANTY HAS BEEN DELIVERED IN THE STATE
OF NEW YORK.

            (h) BENEFIT AND BINDING EFFECT.  The terms of this Guaranty shall be
binding upon each  Guarantor,  and shall inure to the benefit of each Guarantor,
each  Guaranteed  Beneficiary,  and their  respective  successors  and permitted
assigns (to the extent permitted hereunder and under the Loan Documents).

            (i) SERVICE OF PROCESS;  JURISDICTION AND WAIVER. Each Guarantor (A)
hereby irrevocably  submits to the nonexclusive  jurisdiction of (i) the Supreme
Court of the State of New York, New York County (without  prejudice to the right
of any party to remove to the  United  States  District  Court for the  Southern
District of New York) and (ii) the United States District Court for the Southern
District of New York for the purposes of any suit,  action,  or other proceeding
arising  out of this  Guaranty  or the  subject  matter  hereof  brought  by any
Guaranteed  Beneficiary  or its  successors  or  permitted  assigns,  (B) hereby
irrevocably agrees that all claims in respect of such suit, action or proceeding
may be heard and  determined  in such New York  State  court or, to the  fullest
extent permitted by applicable law, in such Federal court, and (C) to the extent
permitted  by  applicable  law,  hereby  irrevocably  waives,  and agrees not to
assert, by way of motion, as a defense, or otherwise,  in any such suit, action,
or proceeding any claim that it is not personally subject to the jurisdiction of
the above-named  courts,  that the suit,  action, or proceeding is brought in an
inconvenient  forum,  that the  venue of the  suit,  action,  or  proceeding  is
improper, or that this Guaranty or the subject matter hereof may not be enforced
in or by such court.  EACH GUARANTOR  WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY
SUIT,  ACTION,  PROCEEDING,  OR COUNTERCLAIM  ARISING OUT OF OR RELATING TO THIS
GUARANTY.  A  final  judgment  obtained  in  respect  of any  suit,  action,  or
proceeding  referred  to in this  Section  5(i) shall be  conclusive  and may be
enforced  in other  jurisdictions  by suit on the  judgment  or in any manner as
provided by applicable law. Each Guarantor hereby consents to service of process
in connection  with the subject  matter  specified in the first sentence of this
Section 5(i) in connection with the  above-mentioned  courts by registered mail,
FedEx,  DHL, or similar  courier at the address to which notices to it are to be
given as provided in Annex A hereto, it being agreed that service in such manner
shall  constitute  valid  service upon such  Guarantor  and its  successors  and
assigns in connection with any such suit, action, or proceeding only;  PROVIDED,
HOWEVER,  that nothing in this Section 5(i) shall affect the right of any of the
Guaranteed  Beneficiaries  or their successors or assigns to serve legal process
in any  other  matter  permitted  by  law  or  affect  the  right  of any of the
Guaranteed  Beneficiaries  or their  successors  or  assigns  to bring any suit,
action, or proceeding  against such Guarantor or its properties in the courts of
other jurisdictions.


                                      -7-


            (j) SAVINGS.  Each Guaranteed  Beneficiary (by its acceptance of the
benefits  hereof) and each  Guarantor  hereby  confirms that it is its intention
that this  Guaranty  not  constitute  a fraudulent  transfer or  conveyance  for
purposes of the  Bankruptcy  Code,  the Uniform  Fraudulent  Transfer Act or any
similar  federal or state law.  To  effectuate  the  foregoing  intention,  each
Guaranteed  Beneficiary and each Guarantor  hereby  irrevocably  agrees that the
Guaranteed Obligations guaranteed by each Guarantor under this Guaranty shall be
limited to such amount as will,  after giving effect to such maximum  amount and
all of such  Guarantor's  other  (contingent or otherwise)  liabilities that are
relevant  under such laws (but  excluding,  to the maximum  extent  permitted by
applicable  law, any liabilities of a Guarantor  arising under any  indebtedness
that is subordinated to the Guaranteed Obligations or any obligations under this
Guaranty),  result in the Guaranteed Obligations of such Guarantor in respect of
such maximum amount not constituting a fraudulent transfer or conveyance.

                                   * * * * *


                                      -8-


            IN WITNESS  WHEREOF,  each  Guarantor has caused this Guaranty to be
executed  as of the day and year  first  written  above for the  benefit  of the
parties named herein.

                                           POLAR AIR CARGO, INC.

                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer


                                           AIRLINE ACQUISITION CORP. I

                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer



                                                                         ANNEX A

                      ADDRESS FOR NOTICES TO THE GUARANTORS

POLAR AIR CARGO, INC.

c/o Atlas Air Worldwide Holdings, Inc.
2000 Westchester Avenue
Purchase, New York 10577-2543

Attention: Treasurer/Corporate Finance

AIRLINE ACQUISITION CORP. I

c/o Atlas Air Worldwide Holdings, Inc.
2000 Westchester Avenue
Purchase, New York 10577-2543

Attention: Treasurer/Corporate Finance



                                                                      SCHEDULE I

      Lease Agreement, dated as of April 25, 2000 and amended and restated as of
July 27,  2004,  between the Lessor and the  Lessee,  as  supplemented  by Lease
Supplement No. 1, dated as of July 27, 2004, which were recorded together as one
instrument by the Federal Aviation  Administration (the "FAA") on July 27, 2004,
as Conveyance No. [__________].


                                      (i)




                           Schedule to Exhibit 10.6.10

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ------------------------- -----------------------------------------
REGISTRATION         MANUFACTURER'S SERIAL    GUARANTORS                AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ------------------------- -----------------------------------------
                                                                
N509MC               21221                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N512MC               21220                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N517MC               23300                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N522MC               21783                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N523MC               21782                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N524MC               21784                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N526MC               22337                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N527MC               22471                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N528MC               22472                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N534MC               21832                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N808MC               21048                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
N809MC               20887                    Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
                                              and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------
CF6-50E2 Spare       530168; 517530;          Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
Engines              517790; 517602;          and Airline Acquisition   27, 2004
                     517547; 517,538;         Corp. I
                     517,539; 455167; 530255
- -------------------- ------------------------ ------------------------- -----------------------------------------
CF6-80C2 BSF Spare   704,699; 704860; 704918  Polar Air Cargo, Inc.     Subsidiaries Guaranty dated as of July
Engines                                       and Airline Acquisition   27, 2004
                                              Corp. I
- -------------------- ------------------------ ------------------------- -----------------------------------------

EX-10.7.3

                                                                  EXHIBIT 10.7.3

                    ACKNOWLEDGMENT AND AGREEMENT (MSN 32838)

            ATLAS AIR WORLDWIDE HOLDINGS,  INC., a Delaware  corporation ("ATLAS
HOLDINGS"),  with reference to (i) the Amendment Agreement (MSN 32838), dated as
of August 1, 2003 (the  "AGREEMENT"),  between  Atlas Air, Inc.  ("LESSEE")  and
Tuolumne River Aircraft  Finance,  Inc.  ("LESSOR"),  and (ii) the Restructuring
Letter  Agreement  (MSN  32838),  dated  as  of  August  1,  2003  (the  "LETTER
AGREEMENT"),  between Lessee and Lessor,  DOES HEREBY ACKNOWLEDGE AND AGREE (to,
with and for the benefit of Lessor and its  successors  and assigns)  that Atlas
Holdings is bound by, and obligated to perform and observe, and hereby agrees to
perform and observe, the terms,  provisions,  conditions and covenants contained
in Sections 2(d),  2(f), 4(c), 7 and 8 of the Agreement and Part I of the Letter
Agreement  (and  expressed  as being  applicable  to or in  respect of a "Lessee
Party",  a "Lessee Party" other than Lessee,  "Atlas Holdings" or an "Affiliate"
of Lessee),  in each case,  with the same force and effect as if Atlas  Holdings
were a party to the  Agreement  and the Letter  Agreement  (in the capacity of a
"Lessee Party" or "Atlas Holdings").

                            [Signature Page Follows]


            IN WITNESS  WHEREOF,  Atlas Holdings has caused this  Acknowledgment
and  Agreement  to be executed  and  delivered  as of this 18th day of November,
2003.

                                              ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                              By /s/ Jeffrey H. Erickson
                                                 -------------------------------
                                                 Name: Jeffrey H. Erickson
                                                 Title: President & COO


          [Signature Page to Acknowledgment and Agreement (MSN 32838)]



                           Schedule to Exhibit 10.7.3

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ---------------------- ---------------------- -------------------------------------------
REGISTRATION         MANUFACTURER'S         ACKNOWLEDGING PARTY    AGREEMENT
NUMBER               SERIAL NUMBER(S)
- -------------------- ---------------------- ---------------------- -------------------------------------------
                                                          
N418MC               32840                  Atlas Air Worldwide    Atlas Air Worldwide Holdings, Inc.
                                            Holdings, Inc.         Acknowledgement and Agreement dated
                                                                   November 18, 2003  with respect to
                                                                   Aircraft N418MC
- -------------------- ---------------------- ---------------------- -------------------------------------------

EX-10.7.4

                                                                  EXHIBIT 10.7.4


                    ACKNOWLEDGMENT AND AGREEMENT (MSN 32838)

            POLAR AIR  CARGO,  INC.,  a  Delaware  corporation  ("POLAR"),  with
reference to Amendment  Agreement  (MSN 32838),  dated as of August 1, 2003 (the
"AGREEMENT"),  between Atlas Air, Inc.  ("LESSEE")  and Tuolumne  River Aircraft
Finance,  Inc.  ("LESSOR"),  DOES HEREBY ACKNOWLEDGE AND AGREE (to, with and for
the benefit of Lessor and its  successors  and assigns)  that Polar is bound by,
and obligated to perform and observe,  and hereby agrees to perform and observe,
the terms,  provisions,  conditions  and covenants  contained in Sections  2(d),
2(e)(i),  2(f),  4(c), 7 and 8 of the Agreement (and applicable to or in respect
of a "Lessee  Party" or a "Lessee  Party" other than Lessee or an "Affiliate" of
Lessee),  in each case, with the same force and effect as if Polar were party to
the Agreement (in the capacity of a "Lessee Party").

                            [Signature Page Follows]



            IN  WITNESS  WHEREOF,  Polar  has  caused  this  Acknowledgment  and
Agreement to be executed and delivered as of this 18th day of November, 2003.

                                             POLAR AIR CARGO, INC.


                                             By /s/ Scott J. Dolan
                                                --------------------------------
                                                Name: Scott J. Dolan
                                                Title: Vice President Operations


          [Signature Page to Acknowledgment and Agreement (MSN 32838)]



                           Schedule to Exhibit 10.7.4

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ----------------------- ------------------------ -------------------------------------------
REGISTRATION         MANUFACTURER'S SERIAL   ACKNOWLEDGING PARTY      AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ----------------------- ------------------------ -------------------------------------------
                                                          
N418MC               32840                   Polar Air Cargo, Inc.    Polar Air Cargo, Inc. Acknowledgement and
                                                                      Agreement dated November 18, 2003  with
                                                                      respect to Aircraft N418MC
- -------------------- ----------------------- ------------------------ -------------------------------------------

EX-10.7.5

                                                                  EXHIBIT 10.7.5


                                 GUARANTY 32838

            GUARANTY 32838, dated as of July 27, 2004 (this "GUARANTY"), of
POLAR AIR CARGO, INC., a California corporation (together with its successors
and assigns, "POLAR") in favor of TUOLUMNE RIVER AIRCRAFT FINANCE, INC., a
Delaware corporation, as lessor under the Lease (as defined below) (together
with its successors and assigns, the "GUARANTEED PARTY");

            WHEREAS, the Guaranteed Party is a party to that certain Lease
Agreement (MSN 32838), dated as of July 16, 2002 (as supplemented by the Lease
Supplement No. 1 dated July 17, 2002, the "LEASE"), between the Guaranteed
Party, as lessor, and Atlas Air, Inc., as lessee ("ATLAS");

            WHEREAS, the Guaranteed Party is a party to that certain Tax
Indemnity Agreement, dated as of July 16, 2002 (the "LEASE TIA"), between
Guaranteed Party, as lessor, and Atlas, as lessee;

            WHEREAS, the Guaranteed Party is a party to that certain Amendment
Agreement (MSN 32838) to the Lease, dated as of August 1, 2003 (the "LEASE
AMENDMENT"), between Guaranteed Party and Atlas;

            WHEREAS, Guaranteed Party is a party to Amendment No. 1 to the Lease
TIA, dated as of August 1, 2003 (the "TIA AMENDMENT"), between Guaranteed Party
and Atlas;

            WHEREAS, Polar is an Affiliate of Atlas and it is of direct benefit
to Polar and is in the furtherance of Polar's business interests that Guaranteed
Party enter into the Lease Amendment and TIA Amendment; and

            WHEREAS, as an inducement for the Guaranteed Party's willingness to
enter into the Lease Amendment and TIA Amendment, Polar has agreed to guarantee
the obligations of Atlas arising under (i) the Lease, as amended by the Lease
Amendment, (ii) the Lease TIA, as amended by the TIA Amendment and (iii) each
Other Agreement (as defined in the Lease, as amended by the Lease Amendment).
Capitalized terms not otherwise defined herein shall have the meaning set forth
in the Lease, as amended by the Lease Amendment.

            NOW, THEREFORE, in consideration of the premises and covenants
herein after contained and for other good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged, Polar hereby agrees
for the benefit of the Guaranteed Party and the Guaranteed Party hereby
acknowledges:



            SECTION 1. GUARANTY BY POLAR. (a) Polar hereby irrevocably and
unconditionally guarantees, as primary obligor and not as a surety, (i) the due
and punctual performance by Atlas of all of its obligations under (1) the Lease,
as amended by the Lease Amendment and (2) the Lease TIA, as amended by the TIA
Amendment and (3) each Other Agreement (collectively, as amended, supplemented
or otherwise modified from time to time, the "OPERATIVE DOCUMENTS"), (ii) the
due, punctual, prompt and complete payment when due of any and all amounts which
are from time to time due and payable by Atlas pursuant to the provisions of the
Operative Documents after any applicable grace periods or notice requirements,
if any, according to the terms thereof and (iii) all sums for which Atlas is or
at any time becomes liable by reason of any breach of or failure to perform or
observe, or any other noncompliance with, any covenant, condition, agreement or
other obligation to be performed by Atlas under any Operative Document, or the
falsity of any representation or warranty of Atlas in any Operative Document
(each of the foregoing (i), (ii) and (iii), including all interest accruing
thereon after the commencement of any bankruptcy, insolvency, reorganization or
similar proceeding, regardless of whether or not a claim can be made or realized
therefor, collectively, the "OBLIGATIONS"). Polar agrees that this Guaranty is a
guarantee of performance and payment and not of collection. Polar hereby agrees
that its obligations hereunder shall be primary, absolute and unconditional,
irrespective of, and unaffected by: (i) any difference between the law selected
as the governing law of the Operative Documents and the law selected as the
governing law of this Guaranty; (ii) the existence, value or condition of, or
failure by the Guaranteed Party to perfect any lien against the Aircraft or the
release of any lien against the Aircraft, including the Airframe, any Engine or
any Part thereof, with respect to the payment and performance by Atlas of its
performance and payment obligations under the Operative Documents or any action,
or the absence of any action, by the Guaranteed Party in respect thereof
(including, without limitation, the release of any such security); (iii) the
insolvency of Atlas, Polar or any Affiliate thereof; (iv) the validity,
regularity, legality or enforceability of any Operative Document, any of the
Obligations or any collateral security or other guaranty therefor at any time or
from time to time held by the Guaranteed Party; (v) any defense, offset or
counterclaim which may at any time be available to or be asserted by Atlas or
Polar against the Guaranteed Party; (vi) any rejection of the Lease, as amended
by the Lease Amendment or any related document by Atlas in any bankruptcy,
reorganization or similar proceedings related thereto; (vii) any extension,
modification (including any increase), indulgence or renewal with respect to any
Obligations; (viii) any limitation of the liability of Atlas under any Operative
Document that may now or hereafter be imposed by any statute, regulation or rule
of law, unless such limitation applies to Polar by mandatory provisions of law;
(ix) any waiver, compromise, consent, delay or other action or inaction or any
exercise or non-exercise of any right, remedy or power with respect to Atlas or
any Affiliate thereof; (x) any change in the structure, ownership or control of
Atlas, Polar or any Affiliate thereof; (xi) any bankruptcy, reorganization,
arrangement, adjustment, composition, liquidation, dissolution or similar
proceeding with respect to Atlas, Polar or any Affiliate thereof; (xii) the
appointment of a custodian, receiver, trustee or other officer with similar
powers with respect to Atlas or Polar or any substantial part of their
respective properties or (xiii) any other event or



circumstance whatsoever which may constitute, or might be construed to
constitute an equitable or legal discharge of a surety or Polar, it being the
purpose and intent of Polar that this Guaranty and Polar's obligations hereunder
shall remain in full force and effect and be binding upon Polar and its
successors until the Obligations and the obligations of Polar under this
Guaranty shall have been satisfied by indefeasible payment in full. Polar waives
expressly and irrevocably, on behalf of itself and any successors or permitted
assigns (including any surety) any and all notice of the creation, renewal,
extension or accrual of any of the Obligations and notice of or proof of
reliance by the Guaranteed Party upon this Guaranty or acceptance of this
Guaranty. Any and all of the Obligations shall conclusively be deemed to have
been created, contracted or incurred, or renewed, extended, amended or waived in
reliance upon this Guaranty and all dealings between Atlas or Polar and the
Guaranteed Party shall likewise be conclusively presumed to have been had or
consummated in reliance upon this Guaranty. Except for the notice provisions
specifically set forth in the applicable Operative Documents with respect to
Atlas, Polar hereby waives diligence, presentment, protest, demand for payment
and notice of default or nonpayment to or upon Atlas or Polar with respect to
the performance and the payment obligations arising hereunder or pursuant to the
Operative Documents. Polar further agrees that its guaranty of the Obligations
shall remain in full force and effect notwithstanding, and it shall not be
required to consent to any amendment or modification (including an increase in
the Obligations) of, or waiver, consent or extension with respect to the
Operative Documents that may be made or given as provided therein. Polar
covenants that this Guaranty will not be discharged except by complete payment
and performance of the Obligations.

            (b) Polar shall be subrogated to all rights of the Guaranteed Party
in respect of any amounts paid by Polar pursuant to the provisions of this
Guaranty; PROVIDED, HOWEVER, that Polar shall be entitled to enforce, or to
receive any payments arising out of or based upon, such right of subrogation
only after all performance and amounts owed to the Guaranteed Party under the
Operative Documents have been satisfied and paid in full.

            (c) This Guaranty shall continue to be effective or be reinstated,
as the case may be, if at any time any payment or performance of the Obligations
owed to the Guaranteed Party is rescinded or must otherwise be returned by the
Guaranteed Party upon the insolvency, bankruptcy or reorganization of Polar or
Atlas or otherwise, all as though such payment or performance had not been made.

            SECTION 2. REPRESENTATIONS AND WARRANTIES. Polar hereby represents
and warrants, for the benefit of the Guaranteed Party that:

                  (a) Polar is a corporation duly organized, validly existing
            and in good standing under the laws of its jurisdiction of
            incorporation, is duly qualified as a foreign corporation and
            authorized to do business in each jurisdiction where the failure to
            be so qualified or in good standing would have a materi-



            ally adverse effect on its business or financial condition, is an
            Affiliate of Atlas and has the corporate power to own its properties
            and carry on its business as now conducted;

                  (b) Polar has full power, authority and legal right to
            execute, deliver and perform this Guaranty, and Polar has taken all
            necessary corporate action to authorize such execution, delivery and
            performance;

                  (c) this Guaranty has been duly authorized, executed and
            delivered by Polar and constitutes the legal, valid and binding
            obligation of Polar, enforceable in accordance with its terms,
            except as such enforceability may be limited by bankruptcy,
            insolvency, reorganization, receivership, moratorium, fraudulent
            transfer and conveyance, and other similar laws affecting the rights
            and remedies of creditors or the Guaranteed Party generally, and by
            general principles of equity, whether considered in a proceeding at
            law or in equity;

                  (d) no consent of any Person (including stockholders or any
            trustee or holder of any obligations of Polar), and no consent,
            license, approval or authorization of, or registration or filing
            with, any governmental authority, bureau or agency is required in
            connection with the execution, delivery and performance of, and
            payment under, this Guaranty, except such consents as have been duly
            obtained; and

                  (e) the execution, delivery, performance and payment of this
            Guaranty by Polar do not and will not contravene any applicable law,
            regulation, order or decree, the organizational or governing
            documents of Polar and do not and will not constitute a default
            under any provision of any indenture, mortgage, contract or other
            agreement to which Polar is a party or by which any of its assets
            may be bound, which default could have a material adverse effect on
            Polar's business or financial condition.

            SECTION 3. NOTICES. All notices to Polar under this Guaranty, until
Polar furnishes written notice to the contrary, shall be in writing and mailed,
faxed or delivered to Atlas Air Worldwide Holdings, Inc., 2000 Westchester
Avenue, Purchase, New York 10577-2543, and directed to the attention of the
General Counsel of Atlas Air Worldwide Holdings, Inc. (facsimile no. (914)
701-8333).

            SECTION 4. MISCELLANEOUS. (a) This Guaranty shall: (i) be binding
upon Polar, its successors and permitted assigns (including any
debtor-in-possession on behalf of Polar); (ii) inure to the benefit of, and be
enforceable by, the Guaranteed Party and its respective successors and assigns
and its Affiliates (and shall be transferable without Polar's consent by the
Guaranteed Party in connection with the transfer of the Obligations under and in
accordance with the terms of the Operative Documents), but shall not, and is not
intended to, create rights



in any other third parties; (iii) not be waived, amended or modified without the
written consent of the Guaranteed Party; (iv) BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUD1NG SECTIONS 5-1401
AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) and (v) may not be assigned,
delegated, pledged, encumbered, hypothecated or transferred in whole or in part
by Polar hereunder. Polar irrevocably waives, to the fullest extent permitted by
applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Guaranty or the transactions contemplated
hereby.

            (b) No failure or delay on the part of the Guaranteed Party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any delay or single or partial exercise of any right, power
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
provided in and contemplated by this Guaranty are cumulative and not exclusive
of any rights or remedies provided by law or at equity.

            (c) Polar irrevocably agrees for the benefit of the Guaranteed
Party, by execution and delivery of this Guaranty, that any legal action or
proceeding brought against Polar with respect to this Guaranty or the
transactions contemplated hereby or by the Operative Documents may be brought
and determined in the courts of the State of New York, New York County, or in
the United States District Court for the Southern District of New York located
in the Borough of Manhattan and Polar hereby irrevocably accepts with regard to
any such action or proceeding, for itself and in respect of its properties,
generally and unconditionally, the non-exclusive jurisdiction of the aforesaid
courts. Nothing herein shall affect the right of the Guaranteed Party to serve
process in any manner permitted by law as to commence legal proceedings or
otherwise to proceed against Polar in any other jurisdiction in which Polar may
be subject to suit.

            (d) Any provision of this Guaranty which is determined by competent
authority to be prohibited and unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

            SECTION 5. INTERPRETATION. The headings of the sections and other
subdivisions of this Guaranty are inserted for convenience only and shall not be
deemed to constitute a part hereof.

            SECTION 6. ATTORNEY'S COST. Polar agrees to pay all reasonable
attorney's fees and disbursements and all other actual costs and expenses that
may be incurred by the Guaranteed Party in the enforcement of this Guaranty,
whether or not an action at law is commenced with respect hereto.



            SECTION 7. WAIVER. In addition to the waivers contained in Section 4
hereof, Polar waives, and agrees that it shall not at any time insist upon,
plead or claim any appraisal, valuation, stay, extension, marshaling of assets
or redemption laws, or exemption (which would not have been available to Atlas),
whether now or at any time hereafter in force, which will delay, prevent or
otherwise affect the performance by Polar of its performance and payment
obligations under, or materially and adversely affect the enforcement by the
Guaranteed Party of, this Guaranty. Polar hereby waives the benefit of all
provisions of law which conflict with the terms of this Guaranty. Polar
represents, warrants and agrees that, as of the date of this Guaranty, its
obligations under this Guaranty are not subject to any offsets or defenses
against the Guaranteed Party.

            SECTION 8. REINSTATEMENT. This Guaranty shall remain in full force
and effect and continue to be effective should any petition be filed by or
against Atlas or Polar for liquidation or reorganization, should Atlas or Polar
become insolvent or make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant part of such Atlas'
or Polar's assets, and shall continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Obligations, or any
part thereof, pursuant to applicable law, is rescinded or reduced in amount, or
must otherwise be restored or returned by the Guaranteed Party, whether as a
"voidable preference", "fraudulent conveyance", or otherwise, all as though such
payment or performance had not been made. In the event that any payment or
performance, or any part thereof, is rescinded, reduced, restored or returned,
the related payment or obligation shall be reinstated and deemed reduced only by
such amount paid or performance received and not so rescinded, reduced, restored
or returned.

            SECTION 9. CURRENCY OF PAYMENT. Any payment to be made by Polar
shall be made on an after-tax basis in the same currency as designated for
payment in the Lease and such designation of the currency of payment is of the
essence.

                            [SIGNATURE PAGE FOLLOWS)



            IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be
executed by its duly authorized officer as of the day, month and year first
above written.

                                           POLAR AIR CARGO, INC.


                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name:  William C. Bradley
                                               Title: Vice President & Treasurer

                          ACKNOWLEDGMENT AND ACCEPTANCE

Tuolumne River Aircraft Finance, Inc. hereby acknowledges and accepts the
provisions of the foregoing Guaranty.

                                           TUOLUMNE RIVER AIRCRAFT FINANCE, INC.


                                           By:
                                               ---------------------------------
                                               Name:
                                               Title:

                       [SIGNATURE PAGE FOR GUARANTY 32838]



            IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be
executed by its duly authorized officer as of the day, month and year first
above written.

                                           POLAR AIR CARGO, INC.


                                           By:
                                               ---------------------------------
                                               Name:
                                               Title:

                          ACKNOWLEDGMENT AND ACCEPTANCE

Tuolumne River Aircraft Finance, Inc. hereby acknowledges and accepts the
provisions of the foregoing Guaranty.

                                           TUOLUMNE RIVER AIRCRAFT FINANCE, INC.


                                           By: Keith A. Helming
                                               ---------------------------------
                                               Name:  Keith A. Helming
                                               Title: Vice President

                       [SIGNATURE PAGE FOR GUARANTY 32838]



                           Schedule to Exhibit 10.7.5

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ------------------------- -----------------------------------------
REGISTRATION         MANUFACTURER'S SERIAL    GUARANTOR                 AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ------------------------- -----------------------------------------
                                                               
N418MC               32840                    Polar Air Cargo, Inc.     Polar Guaranty (N418MC) dated as of
                                                                        July 27, 2004.
- -------------------- ------------------------ ------------------------- -----------------------------------------

EX-10.7.6

                                                                  EXHIBIT 10.7.6


                                 GUARANTY 32838

            GUARANTY 32838, dated as of July 27, 2004 (this "GUARANTY"), of
ATLAS AIR WORLDWIDE HOLDINGS, INC., a Delaware corporation (together with its
successors and assigns, "HOLDINGS") in favor of TUOLUMNE RIVER AIRCRAFT FINANCE,
INC., a Delaware corporation, as Lessor under the Lease (as defined below)
(together with its successors and assigns, the "GUARANTEED PARTY").

            WHEREAS, the Guaranteed Party is a party to that certain Lease
Agreement (MSN 32838), dated as of July 16, 2002 (as supplemented by the Lease
Supplement No. 1 dated July 17, 2002, the "LEASE"), between the Guaranteed
Party, as Lessor, and Atlas Air, Inc., as Lessee ("ATLAS");

            WHEREAS, the Guaranteed Party is a party to that certain Lease Tax
Indemnity Agreement, dated as of July 16, 2002 (the "LEASE TIA"), between
Guaranteed Party, as Lessor, and Atlas, as Lessee;

            WHEREAS, the Guaranteed Party is a party to that certain Amendment
Agreement (MSN 32838) to the Lease, dated as of August 1, 2003 (the "LEASE
AMENDMENT"), between Guaranteed Party and Atlas;

            WHEREAS, Guaranteed Party is a party to Amendment No. 1 to the Lease
T1A, dated as of August 1, 2003 (the "TIA AMENDMENT"), between Guaranteed Party
and Atlas;

            WHEREAS, Holdings is an Affiliate of Atlas and it is of direct
benefit to Holdings and is in the furtherance of Holdings' business interests
that Guaranteed Party enter into the Lease Amendment and TIA Amendment; and

            WHEREAS, as an inducement for the Guaranteed Party's willingness to
enter into the Lease Amendment and TIA Amendment Holdings has agreed to
guarantee the obligations of Atlas arising under (i) the Lease, as amended by
the Lease Amendment, (ii) the Lease TIA, as amended by the TIA Amendment and
(iii) each Other Agreement (as defined in the Lease, as amended by the Lease
Amendment). Capitalized terms not otherwise defined herein shall have the
meaning set forth in the Lease, as amended by the Lease Amendment;

            NOW, THEREFORE, in consideration of the premises and covenants
hereinafter contained and for other good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged, Holdings hereby agrees
for the benefit of the Guaranteed Parts and the Guaranteed Party hereby
acknowledges:



            SECTION 1. GUARANTY BY HOLDINGS. (a) Holdings hereby irrevocably and
unconditionally guarantees, as primary obligor and not as a surety, (i) the due
and punctual performance by Atlas of all of its obligations under (1) the Lease,
as amended by the Lease Amendment and (2) the Lease TIA, as amended by the TIA
Amendment, and (3) each Other Agreement (collectively, as amended, supplemented
or otherwise modified from time to time, the "OPERATIVE DOCUMENTS"), (ii) the
due, punctual, prompt and complete payment when due of any and all amounts which
are from time to time due and payable by Atlas pursuant to the provisions of the
Operative Documents after any applicable grace periods or notice requirements,
if any, according to the terms thereof and (iii) all sums for which Atlas is or
at any time becomes liable by reason of any breach of or failure to perform or
observe, or any other noncompliance with, any covenant, condition, agreement or
other obligation to be performed by Atlas under any Operative Document, or the
falsity of any representation or warranty of Atlas in any Operative Document
(each of the foregoing (i), (ii) and (iii), including all interest accruing
thereon after the commencement of any bankruptcy, insolvency, reorganization or
similar proceeding, regardless of whether or not a claim can be made or realized
therefor, collectively, the "OBLIGATIONS"). Holdings agrees that this Guaranty
is a guarantee of performance and payment and not of collection. Holdings hereby
agrees that its obligations hereunder shall be primary, absolute and
unconditional, irrespective of, and unaffected by: (i) any difference between
the law selected as the governing law of the Operative Documents and the law
selected as the governing law of this Guaranty; (ii) the existence, value or
condition of, or failure by the Guaranteed Party to perfect any lien against the
Aircraft or the release of any lien against the Aircraft, including the
Airframe, any Engine or any Part thereof, with respect to the payment and
performance by Atlas of its performance and payment obligations under the
Operative Documents or any action, or the absence of any action, by the
Guaranteed Party in respect thereof (including, without limitation, the release
of any such security); (iii) the insolvency of Atlas, Holdings or any Affiliate
thereof; (iv) the validity, regularity, legality or enforceability of any
Operative Document, any of the Obligations or any collateral security or other
guaranty therefor at any time or from time to time held by the Guaranteed Party;
(v) any defense, offset or counterclaim which may at any time be available to or
be asserted by Atlas or Holdings against the Guaranteed Party; (vi) any
rejection of the Lease, as amended by the Lease Amendment or any related
document by Atlas in any bankruptcy, reorganization or similar proceedings
related thereto; (vii) any extension, modification (including any increase),
indulgence or renewal with respect to any Obligations; (viii) any limitation of
the liability of Atlas under any Operative Document that may now or hereafter be
imposed by any statute, regulation or rule of law, unless such limitation
applies to Holdings by mandatory provisions of law; (ix) any waiver, compromise,
consent, delay or other action or inaction or any exercise or non-exercise of
any right, remedy or power with respect to Atlas or any Affiliate thereof (x)
any change in the structure, ownership or control of Atlas, Holdings or any
Affiliate thereof; (xi) any bankruptcy, reorganization, arrangement, adjustment,
composition, liquidation, dissolution or similar proceeding with respect to
Atlas, Holdings or any Affiliate thereof; (xii) the appointment of a custodian,
receiver, trustee or other officer with similar powers with respect to Atlas or
Holdings or any substantial part of their respective properties or (xiii) any



other event or circumstance whatsoever which may constitute, or might be
construed to constitute, an equitable or legal discharge of a surety or
Holdings, it being the purpose and intent of Holdings that this Guaranty and
Holdings' obligations hereunder shall remain in full force and effect and be
binding upon Holdings and its successors until the Obligations and the
obligations of Holdings under this Guaranty shall have been satisfied by
indefeasible payment in full. Holdings waives expressly and irrevocably, on
behalf of itself and any successors or permitted assigns (including any surety)
any and all notice of the creation, renewal, extension or accrual of any of the
obligations and notice of or proof of reliance by the Guaranteed Party upon this
Guaranty or acceptance of this Guaranty. Any and all of the Obligations shall
conclusively be deemed to have been created, contracted or incurred, or renewed,
extended, amended or waived in reliance upon this Guaranty and all dealings
between Atlas or Holdings and the Guaranteed Party shall likewise be
conclusively presumed to have been had or consummated in reliance upon this
Guaranty. Except for the notice provisions specifically set forth in the
applicable Operative Documents with respect to Atlas, Holdings hereby waives
diligence, presentment, protest, demand for payment and notice of default or
nonpayment to or upon Atlas or Holdings with respect to the performance and the
payment obligations arising hereunder or pursuant to the Operative Documents.
Holdings further agrees that its guaranty of the Obligations shall remain in
full force and effect notwithstanding, and it shall not be required to consent
to any amendment or modification (including an increase in the Obligations) of,
or waiver, consent or extension with respect to the Operative Documents that may
be made or given as provided therein. Holdings covenants that this Guaranty will
not be discharged except by complete payment and performance of the Obligations.

            (b) Holdings shall be subrogated to all rights of the Guaranteed
Party in respect of any amounts paid by Holdings pursuant to the provisions of
this Guaranty; PROVIDED, HOWEVER, that Holdings shall be entitled to enforce, or
to receive any payments arising out of or based upon, such right of subrogation
only after all performance and amounts owed to the Guaranteed Party under the
Operative Documents have been satisfied and paid in full.

            (c) This Guaranty shall continue to be effective or be reinstated,
as the case may be, if at any time any payment or performance of the Obligations
owed to the Guaranteed Party is rescinded or must otherwise be returned by the
Guaranteed Party upon the insolvency, bankruptcy or reorganization of Holdings
or Atlas or otherwise, all as though such payment or performance had not been
made.

            SECTION 2. REPRESENTATIONS AND WARRANTIES. Holdings hereby
represents and warrants, for the benefit of the Guaranteed Party, that:

                  (a) Holdings is a corporation duly organized, validly existing
            and in good standing under the laws of its jurisdiction of
            incorporation, is duly qualified as a foreign corporation and
            authorized to do business in each jurisdiction



            where the failure to be so qualified or in good standing would have
            a materially adverse effect on its business or financial condition,
            is an Affiliate of Atlas and has the corporate power to own its
            properties and carry on its business as now conducted;

                  (b) Holdings has full power, authority and legal right to
            execute, deliver and perform this Guaranty, and Holdings has taken
            all necessary corporate action to authorize such execution, delivery
            and performance;

                  (c) this Guaranty has been duly authorized, executed and
            delivered by Holdings and constitutes the legal, valid and binding
            obligation of Holdings, enforceable in accordance with its terms,
            except as such enforceability may be limited by bankruptcy,
            insolvency, reorganization, receivership, moratorium, fraudulent
            transfer and conveyance, and other similar laws affecting the rights
            and remedies of creditors or the Guaranteed Party generally, and by
            general principles of equity, whether considered in a proceeding at
            law or in equity;

                  (d) no consent of any Person (including stockholders or any
            trustee or holder of any obligations of Holdings), and no consent,
            license, approval or authorization of, or registration or filing
            with, any governmental authority, bureau or agency is required in
            connection with the execution, delivery and performance of, and
            payment under, this Guaranty, except such consents as have been duly
            obtained; and

                  (e) the execution, delivery, performance and payment of this
            Guaranty by Holdings do not and will not contravene any applicable
            law, regulation, order or decree, the organizational or governing
            documents of Holdings and do not and will not constitute a default
            under any provision of any indenture, mortgage, contract or other
            agreement to which Holdings is a party or by which any of its assets
            may be bound, which default could have a material adverse effect on
            Holdings' business or financial condition.

            SECTION 3. NOTICES. All notices to Holdings under this Guaranty,
until Holdings furnishes written notice to the contrary, shall be in writing and
mailed, faxed or delivered to Atlas Air Worldwide Holdings, Inc., 2000
Westchester Avenue, Purchase, New York 10577-2543, and directed to the attention
of the General Counsel of Atlas Air Worldwide Holdings, Inc. (facsimile no.
(914) 701-8333).

            SECTION 4. MISCELLANEOUS. (a) This Guaranty shall: (i) be binding
upon Holdings, its successors and permitted assigns (including any
debtor-in-possession on behalf of Holdings); (ii) inure to the benefit of, and
be enforceable by, the Guaranteed Party and its respective successors and
assigns and its Affiliates (and shall be transferable without Holdings'



consent by the Guaranteed Party in connection with the transfer of the
Obligations under and in accordance with the terms of the Operative Documents),
but shall not, and is not intended to, create rights in any other third parties;
(iii) not be waived, amended or modified without the written consent of the
Guaranteed Party; (iv) BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH. THE
LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW
YORK GENERAL OBLIGATIONS LAW) and (v) may not be assigned, delegated, pledged,
encumbered, hypothecated or transferred in whole or in part by Holdings
hereunder. Holdings irrevocably waives, to the fullest extent permitted by
applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Guaranty or the transactions contemplated
hereby.

            (b) No failure or delay on the part of the Guaranteed Party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any delay or single or partial exercise of any right, power
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
provided in and contemplated by this Guaranty are cumulative and not exclusive
of any rights or remedies provided by law or at equity.

            (c) Holdings irrevocably agrees for the benefit of the Guaranteed
Party, by execution and delivery of this Guaranty, that any legal action or
proceeding brought against Holdings with respect to this Guaranty or the
transactions contemplated hereby or by the Operative Documents may be brought
and determined in the courts of the State of New York, New York County, or in
the United States District Court for the Southern District of New York located
in the Borough of Manhattan and Holdings hereby irrevocably accepts with regard
to any such action or proceeding, for itself and in respect of its properties,
generally and unconditionally, the non-exclusive jurisdiction of the aforesaid
courts. Nothing herein shall affect the right of the Guaranteed Party to serve
process in any manner permitted by law as to commence legal proceedings or
otherwise to proceed against Holdings in any other jurisdiction in which
Holdings may be subject to suit.

            (d) Any provision of this Guaranty which is determined by competent
authority to be prohibited and unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

            SECTION 5. INTERPRETATION. The headings of the sections and other
subdivisions of this Guaranty are inserted for convenience only and shall not be
deemed to constitute a part hereof.

            SECTION 6. ATTORNEY'S COST. Holdings agrees to pay all reasonable
attorney's fees and disbursements and all other actual costs and expenses that
may be incurred by the



Guaranteed Party in the enforcement of this Guaranty, whether or not an action
at law is commenced with respect hereto.

            SECTION 7. WAIVER. In addition to the waivers contained in Section 4
hereof, Holdings waives, and agrees that it shall not at any time insist upon,
plead or claim any appraisal, valuation, stay, extension, marshaling of assets
or redemption laws, or exemption (which would not have been available to Atlas),
whether now or at any time hereafter in force, which will delay, prevent or
otherwise affect the performance by Holdings of its performance and payment
obligations under, or materially and adversely affect the enforcement by the
Guaranteed Party of, this Guaranty. Holdings hereby waives the benefit of all
provisions of law which conflict with the terms of this Guaranty. Holdings
represents, warrants and agrees that, as of the date of this Guaranty, its
obligations under this Guaranty are not subject to any offsets or defenses
against the Guaranteed Party.

            SECTION 8. REINSTATEMENT. This Guaranty shall remain in full force
and effect and continue to be effective should any petition be filed by or
against Alias or Holdings for liquidation or reorganization, should Atlas or
Holdings become insolvent or make an assignment for the benefit of creditors or
should a receiver or trustee be appointed for all or any significant part of
such Atlas' or Holdings' assets, and shall continue to be effective or be
reinstated, as the case may be, if at any time payment and performance of the
Obligations, or any part thereof, pursuant to applicable law, is rescinded or
reduced in amount, or must otherwise be restored or returned by the Guaranteed
Party, whether as a "voidable preference", "fraudulent conveyance", or
otherwise, all as though such payment or performance had not been made, in the
event that any payment or performance, or any part thereof, is rescinded,
reduced, restored or returned, the related payment or obligation shall be
reinstated and deemed reduced only by such amount paid or performance received
and not so rescinded, reduced, restored or returned.

            SECTION 9. CURRENCY OF PAYMENT. Any payment to be made by Holdings
shall be made on an after-tax basis in the same currency as designated for
payment in the Lease and such designation of the currency of payment is of the
essence.

                            [SIGNATURE PAGE FOLLOWS]



            IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be
executed by its duly authorized officer as of the day, month and year first
above written.

                                           ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                           By: /s/ William C. Bradley
                                               ------------------------------
                                               Name:  William C. Bradley
                                               Title: Vice President & Treasurer

                          ACKNOWLEDGMENT AND ACCEPTANCE

Tuolumne River Aircraft Finance, Inc. hereby acknowledges and accepts the
provisions of the foregoing Guaranty.

                                           TUOLUMNE RIVER AIRCRAFT FINANCE, INC.


                                           By:
                                               ------------------------------
                                               Name:
                                               Title:

                       [SIGNATURE PAGE FOR GUARANTY 32838]



            IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be
executed by its duly authorized officer as of the day, month and year first
above written.

                                           ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                           By:
                                               ------------------------------
                                               Name:
                                               Title:

                          ACKNOWLEDGMENT AND ACCEPTANCE

Tuolumne River Aircraft Finance, Inc. hereby acknowledges and accepts the
provisions of the foregoing Guaranty.

                                           TUOLUMNE RIVER AIRCRAFT FINANCE, INC.


                                           By: /s/ Keith A. Helming
                                               ------------------------------
                                               Name:  Keith A. Helming
                                               Title: Vice President

                       [SIGNATURE PAGE FOR GUARANTY 32838]



                           Schedule to Exhibit 10.7.6

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.



- -------------------- ------------------------ ------------------------- -----------------------------------------
REGISTRATION         MANUFACTURER'S SERIAL    GUARANTOR                 AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ------------------------- -----------------------------------------
                                                               
N418MC               32840                    Atlas Air Worldwide       AAWH Guaranty (N418MC) dated as of July
                                              Holdings, Inc.            27, 2004.
- -------------------- ------------------------ ------------------------- -----------------------------------------

EX-10.8.3

                                                                  EXHIBIT 10.8.3

                    ACKNOWLEDGMENT AND AGREEMENT (MSN 22237)

            ATLAS AIR WORLDWIDE HOLDINGS,  INC., a Delaware  corporation ("ATLAS
HOLDINGS"),  with reference to (i) the Amendment Agreement (MSN 22237), dated as
of August 1, 2003 (the  "AGREEMENT"),  between Polar Air Cargo, Inc.  ("LESSEE")
and Polaris Aircraft (Pacific Rim), Inc. ("LESSOR"),  and (ii) the Restructuring
Letter  Agreement  (MSN  22237),  dated  as  of  August  1,  2003  (the  "LETTER
AGREEMENT"),  between Lessee and Lessor,  DOES HEREBY ACKNOWLEDGE AND AGREE (to,
with and for the benefit of Lessor and its  successors  and assigns)  that Atlas
Holdings is bound by, and obligated to perform and observe, and hereby agrees to
perform and observe, the terms,  provisions,  conditions and covenants contained
in Sections 2(d),  2(f), 4(c), 7 and 8 of the Agreement and Part I of the Letter
Agreement  (and  expressed  as being  applicable  to or in  respect of a "Lessee
Party" a "Lessee Party" other than Lessee, "Atlas Holdings" or an "Affiliate" of
Lessee),  in each case, with the same force and effect as if Atlas Holdings were
a party to the Agreement and the Letter  Agreement (in the capacity of a "Lessee
Party" or "Atlas Holdings").

                            [Signature Page Follows]


            IN WITNESS  WHEREOF,  Atlas Holdings has caused this  Acknowledgment
and  Agreement  to be executed  and  delivered  as of this 18th day of November,
2003.

                                              ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                              By /s/ Jeffrey H. Erickson
                                                 -------------------------------
                                                 Name: Jeffrey H. Erickson
                                                 Title: President & COO

      [Signature Page to Acknowledgment, Consent and Agreement (MSN 22237)]

EX-10.8.4

                                                                  EXHIBIT 10.8.4


                ACKNOWLEDGMENT, CONSENT AND AGREEMENT (MSN 22237)

            ATLAS  AIR  WORLDWIDE   HOLDINGS,   INC.,  a  Delaware   corporation
("GUARANTOR"), with reference to the Guaranty, dated as of November 9, 2001 (the
"GUARANTY"),  made by  Guarantor  in favor of Polaris  Holding  Company  and its
successors  and assigns  ("GUARANTEED  PARTY")  relating to the  Aircraft  Lease
Agreement,  dated as of October 24, 2001,  between Polaris Holding  Company,  as
lessor,  and  Polar  Air  Cargo,  Inc.,  as  lessee,  as  supplemented  by Lease
Supplement  No. 1 dated  November  9, 2001 and the  Letter  Agreement  No. 1 (as
defined in such Aircraft Lease  Agreement),  and as assigned by Polaris  Holding
Company to Polaris  Aircraft  (Pacific Rim),  Inc.,  assumed by Polaris Aircraft
(Pacific Rim),  Inc. and amended  pursuant to the Aircraft Lease  Assignment and
Amendment  Agreement,  dated as of June 23, 2003, among Polaris Holding Company,
Polaris  Aircraft  (Pacific  Rim),  Inc.  ("LESSOR")  and Polar Air Cargo,  Inc.
("LESSEE")  (as so  supplemented  and as so assigned and  amended,  the "LEASE";
capitalized  terms used herein but not defined herein having the meanings stated
or ascribed in the Lease), and to the other Operative Documents, DOES HEREBY (in
each case, for the benefit of the Guaranteed  Party and, in each case (except to
the  extent  otherwise  provided  herein),  without  limitation  of any  term or
provision of the Guaranty):

                  (i)  ACKNOWLEDGE  receipt  (pursuant to and as required by the
      Guaranty)  of  notice  of (a)  the  amendment  of the  Lease  pursuant  to
      Amendment  Agreement  (MSN  22237),  dated as of August 1,  2003,  between
      Lessor and  Lessee  (the  "LEASE  AMENDMENT"),  and (b) the  Restructuring
      Letter Agreement (MSN 22237),  dated as of August 1, 2003,  between Lessor
      and Lessee which is referred to in the Lease Amendment (THE "RESTRUCTURING
      LETTER AGREEMENT");

                  (ii)  CONSENT  to (a) the  terms and  provisions  of the Lease
      Amendment  and the  Restructuring  Letter  Agreement,  (b) the  execution,
      delivery  and  performance  thereof  by  Lessor  and  Lessee,  and (c) the
      amendment of the Lease pursuant thereto and on the terms provided therein;

                  (iii)  AGREE  that,  from and  after  the  Effective  Date (as
      defined in the Lease  Amendment),  (a) any reference in the Guaranty,  the
      Lease or any other Operative Document,  or otherwise by Guarantor,  to the
      Lease shall mean the Lease, as amended by the Lease Amendment  (including,
      without  limitation,  the references  therein to the Restructuring  Letter
      Agreement),  and (b) any reference by Guarantor or Guaranteed Party to the
      Guaranty shall mean the Guaranty, as supplemented hereby; and

                  (iv) AGREE that, except as supplemented  hereby,  the Guaranty
      shall  remain in full force and effect as in  existence on the date hereof
      and is hereby ratified and confirmed in all respects.

                            [Signature Page Follows]



            IN  WITNESS  WHEREOF,  Guarantor  has  caused  this  Acknowledgment,
Consent  and  Agreement  to be  executed  and  delivered  as of this 18th day of
November, 2003.

                                         ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                         By /s/ Jeffrey H. Erickson
                                            ------------------------------------
                                            Name: Jeffrey H. Erickson
                                            Title: President & COO


      [Signature Page to Acknowledgment, Consent and Agreement (MSN 22237)]

EX-10.8.5

                                                                  EXHIBIT 10.8.5

                                 GUARANTY 22237


            GUARANTY 22237, dated as of July 27, 2004 (this "GUARANTY"), of
ATLAS AIR, INC., a Delaware corporation (together with its successors and
assigns, "ATLAS") in favor of POLARIS AIRCRAFT (PACIFIC RIM), INC., a California
corporation, as lessor under the Lease (as defined below) (together with its
successors and assigns, the "GUARANTEED PARTY").

            WHEREAS, the Guaranteed Party is a party to that certain Aircraft
Lease Agreement (MSN 30808), dated as of October 24, 2001 (as supplemented by
Lease Supplement No. 1 dated November 9, 2001, the "LEASE"), between the
Guaranteed Party, as lessor, and Polar Air Cargo, Inc., as lessee ("POLAR");

            WHEREAS, the Guaranteed Party is a party to that certain Amendment
Agreement (MSN 22237) to the Lease, dated as of August 1, 2003 (the "LEASE
AMENDMENT"), between Guaranteed Party and Polar;

            WHEREAS, Atlas is an Affiliate of Polar and it is of direct benefit
to Atlas and is in the furtherance of Atlas' business interests that Guaranteed
Party enter into the Lease Amendment; and

            WHEREAS, as an inducement for the Guaranteed Party's willingness to
enter into the Lease Amendment, Atlas has agreed to guarantee the obligations of
Polar arising under (i) the Lease, as amended by the Lease Amendment, and (ii)
each Other Agreement (as defined in the Lease, as amended by the Lease
Amendment). Capitalized terms not otherwise defined herein shall have the
meaning set forth in the Lease, as amended by the Lease Amendment;

            NOW, THEREFORE, in consideration of the premises and covenants
hereinafter contained and for other good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged. Atlas hereby agrees
for the benefit of the Guaranteed Party and the Guaranteed Party hereby
acknowledges:

            SECTION 1. GUARANTY BY ATLAS. (a) Atlas hereby irrevocably and
unconditionally guarantees, as primary obligor and not as a surety, (i) the due
and punctual performance by Polar of all of its obligations under (l) the Lease,
as amended by the Lease Amendment, and (3) each Other Agreement (collectively,
as amended, supplemented or otherwise modified from time to time, the "OPERATIVE
DOCUMENTS"), (ii) the due, punctual, prompt and complete payment when due of any
and all amounts which are from time to time due and payable by Polar pursuant to
the provisions of the Operative Documents after any applicable grace periods or
notice requirements if any, according to the terms thereof and (iii) all sums
for which Polar is or at any time becomes liable by reason of any breach of or
failure to per-



form or observe, or any other noncompliance with, any covenant, condition,
agreement or other obligation to be performed by Polar under any Operative
Document, or the falsity of any representation or warranty of Polar in any
Operative Document (each of the foregoing (i), (ii) and (iii), including all
interest accruing thereon after the commencement of any bankruptcy, insolvency,
reorganization or similar proceeding, regardless of whether or not a claim can
be made or realized therefor, collectively, the "OBLIGATIONS"). Atlas agrees
that this Guaranty is a guarantee of performance and payment and not of
collection. Atlas hereby agrees that its obligations hereunder shall be primary,
absolute and unconditional, irrespective of, and unaffected by: (i) any
difference between the law selected as the governing law of the Operative
Documents and the law selected as the governing law of this Guaranty; (ii) the
existence, value or condition of or failure by the Guaranteed Party to perfect
any lien against the Aircraft or the release of any lien against the Aircraft,
including the Airframe, any Engine or any Part thereof, with respect to the
payment and performance by Polar of its performance and payment obligations
under the Operative Documents or any action, or the absence of any action, by
the Guaranteed Party in respect thereof (including, without limitation, the
release of any such security); (iii) the insolvency of Polar, Atlas or any
Affiliate thereof; (iv) the validity, regularity, legality or enforceability of
any Operative Document, any of the Obligations or any collateral security or
other guaranty therefor at any time or from time to time held by the Guaranteed
Party; (v) any defense, offset or counterclaim which may at any time be
available to or be asserted by Polar or Atlas against the Guaranteed Party; (vi)
any rejection of the Lease, as amended by the Lease Amendment or any related
document by Polar in any bankruptcy, reorganization or similar proceedings
related thereof; (vii) any extension, modification (including any increase),
indulgence or renewal with respect to any Obligations; (viii) any limitation of
the liability of Polar under any Operative Document that may now or hereafter be
imposed by any stature, regulation or rule of law, unless such limitation
applies to Atlas by mandatory provisions or law; (ix) any waiver, compromise,
consent, delay or other action or inaction or any exercise or non-exercise of
any right, remedy or power with respect to Polar or any Affiliate thereof; (x)
any change in the structure, ownership or control of Polar, Atlas or any
Affiliate thereof; (xi) any bankruptcy, reorganization, arrangement, adjustment,
composition, liquidation, dissolution or similar proceeding with respect to
Polar, Atlas or any Affiliate thereof; (xii) the appointment or a custodian,
receiver, trustee or other officer with similar powers with respect to Polar or
Atlas or any substantial part of their respective properties or (xiii) any other
event or circumstance whatsoever which may constitute, or might be construed to
constitute, an equitable or legal discharge of a surety or Atlas, it being the
purpose and intent of Atlas that this Guaranty and Atlas' obligations hereunder
shall remain in full force and effect and be binding upon Atlas and its
successors until the Obligations and the obligations of Atlas under this
Guaranty shall have been satisfied by indefeasible payment in full. Atlas waives
expressly and irrevocably, on behalf of itself and any successors or permitted
assigns (including any surety) any and all notice of the [ILLEGIBLE] renewal,
extension or accrual of any of the Obligations and [ILLEGIBLE] of or proof of
reliance by the Guaranteed Party upon this Guaranty or acceptance or this
Guaranty. Any [ILLEGIBLE] of the Obligations shall conclusively be deemed to
have been [ILLEGIBLE], [ILLEGIBLE] or [ILLEGIBLE] , or renewed, extended,



amended or waived in reliance upon this Guaranty and all dealings between Polar
or Atlas and the Guaranteed Party shall likewise be conclusively presumed to
have been had or consummated in reliance upon this Guaranty. Except for the
notice provisions specifically set forth in the applicable Operative Documents
with respect to Polar, Atlas hereby waives diligence, presentment, protest,
demand for payment and notice of default or nonpayment to or upon Polar or Atlas
with respect to the performance and the payment obligations arising hereunder or
pursuant to the Operative Documents. Atlas further agrees that its guaranty of
the Obligations shall remain in full force and effect notwithstanding, and it
shall not be required to consent to any amendment or modification (including an
increase in the Obligations) of, or waiver, consent or extension with respect to
the Operative Documents that may be made or given as provided therein. Atlas
[ILLEGIBLE] that this Guaranty will not be discharged except by complete payment
and performance of the Obligations.

            (b) Atlas shall be subrogated to all rights of the Guaranteed Party
in respect of any amounts paid by Atlas pursuant to the provisions of this
Guaranty; PROVIDED, HOWEVER, that Atlas shall be entitled to enforce or to
receive any payments arising out of or based upon, such right of subrogation
only after all performance and amounts owed to the Guaranteed Party under the
Operative Documents have been satisfied and paid in full.

            (c) This Guaranty shall continue to be effective or be reinstated,
as the case may be, if at any time any payment or performance of the Obligations
owed to the Guaranteed Party is rescinded or must otherwise be returned by the
Guaranteed Party upon the insolvency, bankruptcy or reorganization of Atlas or
Polar or otherwise all as though such payment or performance had not been made.

            SECTION 2. REPRESENTATION AND WARRANTIES. Atlas hereby represents
and warrants, for the benefit of the Guaranteed Party, that:

                  (a) Atlas is a corporation duly organized, validly existing
            and in good standing under the laws of its jurisdiction of
            incorporation, is duly qualified as a foreign corporation and
            authorized to do business in each jurisdiction where the failure to
            be so qualified or in good standing would have a materially adverse
            effect on its business or financial condition, is an Affiliate of
            Polar and has the corporate power to own its properties and carry on
            its business as now conducted;

                  (b) Atlas has full power, authority, and legal right to
            execute, deliver and perform this Guaranty, and Atlas has taken all
            necessary corporate action to authorize such execution, delivery and
            performance;

                  (c) this Guaranty has been duly authorized, executed and
            delivered by Atlas and constitutes the legal, valid and binding
            obligation of Atlas, enforceable in accordance with its terms,
            except as such enforceability may be



            limited by bankruptcy, insolvency, reorganization, receivership,
            moratorium, fraudulent transfer and conveyance, and other similar
            laws affecting the rights and remedies of creditors or the
            Guaranteed Party generally, and by general principles of equity,
            whether considered in a proceeding at law or in equity;

                  (d) no consent of any Person (including stockholders or any
            trustee or holder of any obligations of Atlas), and no consent,
            license, approval or authorization of, or registration or filing
            with, any governmental authority, bureau or agency is required in
            connection with the execution, delivery and performance of, and
            payment under this Guaranty, except such consents as have been duly
            obtained; and

                  (e) the execution, delivery, performance and payment of this
            Guaranty by Atlas do not and will not contravene any applicable law,
            regulation, order or decree, the organizational or governing
            documents of Atlas and do not and will not constitute a default
            under any provision of any indenture, mortgage, contract or other
            agreement to which Atlas is a party or by which any of its assets
            may be bound, which default could have a material adverse effect on
            Atlas' business or financial condition.

            SECTION 3. NOTICES. All notices to Atlas under this Guaranty, until
Atlas furnishes written notice to the contrary, shall be in writing and mailed,
faxed or delivered to Atlas Air Worldwide Holdings, Inc., 2000 Westchester
Avenue, Purchase, New York 10577-2543, and directed to the attention of the
General Counsel of Atlas Air Worldwide Holdings, Inc. (facsimile no. (914)
701-8333).

            SECTION 4. MISCELLEANEOUS. This Guaranty shall: (i) be binding upon
Atlas, its successors and permitted assigns including any debt [ILLEGIBLE]
possession on behalf of Atlas); (ii) inure to the benefit of and be enforceable
by the Guaranteed Party and its respective successors and assigns and its
Affiliates (and shall be transferable without Atlas' consent by the Guaranteed
Party in connection with the transfer of the Obligations under and in accordance
with the terms of the Operative Documents), but shall not and is not intended
to, create rights in any other third parties; (iii) not be waived, amended or
modified without the written consent of the Guaranteed Party; (iv) BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (INCLUDING
SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) and (v) may
not be assigned, delegated, pledged, encumbered, hypothecated or transferred in
whole or in part by Atlas hereunder [ILLEGIBLE] to the fullest extent permitted
by applicable law, any and all rights [ILLEGIBLE] by jury in any legal
proceeding arising out of or relating to this Guaranty or the transactions
[ILLEGIBLE] hereby.

            (b) No failure or delay on the part of the Guaranteed Party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any delay



or single or partial exercise of any right, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies provided in and contemplated
by this Guaranty are cumulative and not exclusive of any rights or remedies
provided by law or as equity.

            (c) Atlas irrevocably agrees for the benefit of the Guaranteed
Party, by execution and delivery of this Guaranty that any legal action or
proceeding brought against Atlas with respect to this Guaranty or the
transactions contemplated hereby or by the Operative Documents may be brought
and determined in the courts of the State of New York, New York County, or in
the United States District Court for the Southern District of New York located
in the Borough of Manhattan and Atlas hereby irrevocable accepts with regard to
any such action or proceeding, for itself and in respect of its properties,
generally and unconditionally, the non-exclusive jurisdiction of the aforesaid
courts. Nothing herein shall affect the right of the Guaranteed Party to serve
process in any manner permitted by law as to commence legal proceedings or
otherwise to proceed against Atlas in any other jurisdiction in which Atlas may
be subject to suit.

            (d) Any provision of this Guaranty which is determined by competent
authority to be prohibited and unenforceable in any jurisdiction shall as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or enforceability in any jurisdiction shall not invalidate or
render unenforceable such provisions in any other jurisdiction.

            SECTION 5. INTERPRETATION. The headings of the sections and other
subdivisions of this Guaranty are inserted for convenience only and shall not be
deemed to constitute a part hereof.

            SECTION 6. ATTORNEY'S COST. Atlas agrees to pay all reasonable
attorney's fees and disbursements and all other actual costs and expenses that
may be incurred by the Guaranteed Party in the enforcement of this Guaranty,
whether or not an action at law is commenced with respect hereto.

            SECTION 7. WAIVER. In addition to the waivers contained in Section 4
hereof, Atlas waives, and agrees that it shall not at any time insist upon,
plead or claim any appraisal, valuation, stay, extension, marshaling of assets
or redemption laws, or exemption (which would not have been available to Polar),
whether now or at any time hereafter in force, which will delay, prevent or
otherwise affect the performance by Atlas of its performance and payment
obligations under or materially and adversely affect the enforcement by the
Guaranteed Party of this Guaranty. Atlas hereby waives the benefit of all
provisions of law which conflict with the terms of this Guaranty are not subject
to any offsets or defenses against the Guaranteed Party.



            SECTION 8. REINSTATEMENT. This Guaranty shall remain in full force
and effect and continue to be effective should any petition be filed by or
against Polar or Atlas for liquidation or reorganization should Polar or Atlas
become insolvent or make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant part of such Polar's
or Atlas' assets, and shall continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Obligations, or any
part thereof, pursuant to applicable law, is rescinded or reduced in amount, or
must otherwise be restored or returned by the Guaranteed Party, whether as a
"voidable preference" , "fraudulent conveyance", or otherwise, all as though
such payment or performance had not been made. In the event that any payment or
performance or any part thereof, is rescinded, reduced, restored or returned,
the related payment or obligation shall be reinstated and deemed reduced only by
such amount paid or performance received and not so rescinded, reduced, restored
or returned.

            SECTION 9. CURRENCY OF PAYMENT. Any payment to be made by Atlas
shall be made on an after-tax basis in the same currency as designated for
payment in the Lease and such designation of the currency of payment is of the
essence.

                            [SIGNATURE PAGE FOLLOWS]



            IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be
executed by its duly authorized officer as of the day, month and year first
above written.

                                           ATLAS AIR, INC.


                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name:  William C. Bradley
                                               Title: Vice President & Treasurer

                           ACKNOWLEDGMENT AND ACCEPTANCE

Polaris Aircraft (Pacific Rim), Inc. hereby acknowledges and accepts the
provisions of the foregoing Guaranty.

                                           POLARIS AIRCRAFT (PACIFIC RIM), INC.


                                           By:
                                               ---------------------------------
                                               Name:
                                               Title:

                       [SIGNATURE PAGE FOR GUARANTY 22237]



            IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be
executed by its duly authorized officer as of the day, month and year first
above written.

                                           ATLAS AIR, INC.


                                           By:
                                               ---------------------------------
                                               Name:
                                               Title:

                           ACKNOWLEDGMENT AND ACCEPTANCE

Polaris Aircraft (Pacific Rim), Inc. hereby acknowledges and accepts the
provisions of the foregoing Guaranty.

                                           POLARIS AIRCRAFT (PACIFIC RIM), INC.


                                           By: /s/ Keith A. Helming
                                               ---------------------------------
                                               Name:  Keith A. Helming
                                               Title: Vice President

                       [SIGNATURE PAGE FOR GUARANTY 22237]

EX-10.8.6

                                                                  EXHIBIT 10.8.6


                                 GUARANTY 22237

            GUARANTY 22237, dated as of July 27, 2004 (this "GUARANTY"), of
ATLAS AIR WORLDWIDE HOLDINGS, INC., a Delaware corporation (together with its
successors and assigns, "HOLDINGS") in favor of POLARIS AIRCRAFT (PACIFIC RIM),
INC., a California corporation, as lessor under the Lease (as defined below)
(together with its successors and assigns, the "GUARANTEED PARTY").

            WHEREAS, the Guaranteed Party is a party to that certain Aircraft
Lease Agreement (MSN 22237), dated as of October 24, 2001 (as supplemented by
the Lease Supplement No. 1 dated November 9, 2001, the "LEASE"), between the
Guaranteed Party, as lessor, and Polar Air Cargo, Inc., as lessee ("POLAR");

            WHEREAS, the Guaranteed Party is a party to that certain Amendment
Agreement (MSN 22237) to the Lease, dated as of August 1, 2003 (the "LEASE
AMENDMENT"), between Guaranteed Party and Polar;

            WHEREAS, Holdings is an Affiliate of Polar and it is of direct
benefit to Holdings and is in the furtherance of Holdings' business interests
that Guaranteed Party enter into the Lease Amendment; and

            WHEREAS, as an inducement for the Guaranteed Party's willingness to
enter into the Lease Amendment, Holdings has agreed to guarantee the obligations
of Polar arising under (i) the Lease, as amended by the Lease Amendment, and
(ii) each Other Agreement (as defined in the Lease, as amended by the Lease
Amendment). Capitalized terms not otherwise defined herein shall have the
meaning set forth in the Lease, as amended by the Lease Amendment;

            NOW, THEREFORE, in consideration of the premises and covenants
hereinafter contained and for other good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged. Holdings hereby agrees
for the benefit of the Guaranteed Party and the Guaranteed Party hereby
acknowledges:

            Section 1. GUARANTY BY HOLDINGS. (a) Holdings hereby irrevocably and
unconditionally guarantees, as primary obligor and not as a surety, (i) the due
and punctual performance by Polar of all of its obligations under (1) the Lease,
as amended by the Lease Amendment and (2) each Other Agreement (collectively, as
amended, supplemented or otherwise modified from time to time, the "OPERATIVE
DOCUMENTS"), (ii) the due, punctual, prompt and complete payment when due of any
and all amounts which are from time to time due and payable by Polar pursuant to
the provisions of the Operative Documents after any applicable grace periods or
notice requirements, if any, according to the terms thereof and (iii) all sums
for which Polar is or at any time becomes liable by reason of any breach of or
failure



to perform or observe, or any other noncompliance with, any covenant, condition,
agreement or other obligation to be performed by Polar under any Operative
Document, or the falsity of any representation or warranty of Polar in any
Operative Document (each of the foregoing (i), (ii) and (iii), including all
interest accruing thereon after the commencement of any bankruptcy, insolvency,
reorganization or similar proceeding, regardless of whether or not a claim can
be made or realized therefor, collectively, the "OBLIGATIONS"). Holdings agrees
that this Guaranty is a guarantee of performance and payment and not of
collection. Holdings hereby agrees that its obligations hereunder shall be
primary, absolute and unconditional, irrespective of, and unaffected by: (i) any
difference between the law selected as the governing law of the Operative
Documents and the law selected as the governing law of this Guaranty: (ii) the
existence, value or condition of, or failure by the Guaranteed Party to perfect
any lien against the Aircraft or the release of any lien against the Aircraft,
including the Airframe, any Engine or any Part thereof, with respect to the
payment and performance by Polar of its performance and payment obligations
under the Operative Documents or any action, or the absence of any action, by
the Guaranteed Party in respect thereof (including, without limitation, the
release of any such security); (iii) the insolvency of Polar, Holdings or any
Affiliate thereof: (iv) the validity, regularity. legality or enforceability of
any Operative Document, any of the Obligations or any collateral security or
other guaranty therefor at any time or from time to time held by the Guaranteed
Party; (v) any defense, offset or counterclaim which may at any time be
available to or be asserted by Polar or Holdings against the Guaranteed Party;
(vi) any rejection of the Lease, as amended by the Lease Amendment or any
related document by Polar in any bankruptcy, reorganization or similar
proceedings related thereto; (vii) any extension, modification (including any
increase), indulgence or renewal with respect to any Obligations; (viii) any
limitation of the liability of Polar under any Operative Document that may now
or hereafter be imposed by any statute, regulation or rule of law, unless such
limitation applies to Holdings by mandatory provisions of law; (ix) any waiver,
compromise, consent, delay or other action or inaction or any exercise or
non-exercise of any right, remedy or power with respect to Polar or any
Affiliate thereof; (x) any change in the structure, ownership or control of
Polar, Holdings or any Affiliate thereof; (xi) any bankruptcy, reorganization,
arrangement, adjustment, composition, liquidation, dissolution or similar
proceeding with respect to Polar, Holdings or any Affiliate thereof; (xii) the
appointment of a custodian, receiver, trustee or other officer with similar
powers with respect to Polar or Holdings or any substantial part of their
respective properties or (xiii) any other event or circumstance whatsoever which
may constitute, or might be construed to constitute, an equitable or legal
discharge of a surety or Holdings, it being the purpose and intent of Holdings
that this Guaranty and Holdings' obligations hereunder shall remain in full
force and effect and be binding upon Holdings and its successors until the
Obligations and the obligations of Holdings under this Guaranty shall have been
satisfied by indefeasible payment in full. Holdings waives expressly and
irrevocably, on behalf of itself and any successors or permitted assigns
(including any surety) any and all notice of the creation, renewal, extension or
accrual of any of the obligations and notice of or proof of reliance by the
Guaranteed Party upon this Guaranty or acceptance of this Guaranty. Any and all
of the Obligations shall conclusively be deemed to have been created, con-



tracted or incurred, or renewed, extended, amended or waived in reliance upon
this Guaranty and all dealings between Polar or Holdings and the Guaranteed
Party shall likewise be conclusively presumed to have been had or consummated in
reliance upon this Guaranty. Except for the notice provisions specifically set
forth in the applicable Operative Documents with respect to Polar, Holdings
hereby waives diligence, presentment, protest, demand for payment and notice of
default or nonpayment to or upon Polar or Holdings with respect to the
performance and the payment obligations arising hereunder or pursuant to the
Operative Documents. Holdings further agrees that its guaranty of the
Obligations shall remain in full force and effect notwithstanding, and it shall
not be required to consent to any amendment or modification (including an
increase in the Obligations) of, or waiver, consent or extension with respect to
the Operative Documents that may be made or given as provided therein. Holdings
covenants that this Guaranty will not be discharged except by complete payment
and performance of the Obligations.

            (b) Holdings shall be subrogated to all rights of the Guaranteed
Party in respect of any amounts paid by Holdings pursuant to the provisions of
this Guaranty; PROVIDED, HOWEVER, that Holdings shall be entitled to enforce, or
to receive any payments arising out of or based upon, such right of subrogation
only after all performance and amounts owed to the Guaranteed Party under the
Operative Documents have been satisfied and paid in full.

            (c) This Guaranty shall continue to be effective or be reinstated,
as the case may be, if at any time any payment or performance of the Obligations
owed to the Guaranteed Party is rescinded or must otherwise be returned by the
Guaranteed Party upon the insolvency, bankruptcy or reorganization of Holdings
or Polar or otherwise, all as though such payment or performance had not been
made.

            Section 2. REPRESENTATIONS AND WARRANTIES. Holdings hereby
represents and warrants, for the benefit of the Guaranteed Party, that:

                  (a) Holdings is a corporation duly organized, validly existing
            and in good standing under the laws of its jurisdiction of
            incorporation, is duly qualified as a foreign corporation and
            authorized to do business in each jurisdiction where the failure to
            be so qualified or in good standing would have a materially adverse
            effect on its business or financial condition, is an Affiliate of
            Polar and has the corporate power to own its properties and carry on
            its business as now conducted;

                  (b) Holdings has full power, authority and legal right to
            execute, deliver and perform this Guaranty, and Holdings has taken
            all necessary corporate action to authorize such execution, delivery
            and performance;



                  (c) this Guaranty has been duly authorized, executed and
            delivered by Holdings and constitutes the legal, valid and binding
            obligation of Holdings, enforceable in accordance with its terms,
            except as such enforceability may be limited by bankruptcy,
            insolvency, reorganization, receivership, moratorium, fraudulent
            transfer and conveyance, and other similar laws affecting the rights
            and remedies of creditors or the Guaranteed Party generally, and by
            general principles of equity, whether considered in a proceeding at
            law or in equity:

                  (d) no consent of any Person (including stockholders or any
            trustee or holder of any obligations of Holdings), and no consent,
            license, approval or authorization of or registration or filing
            with, any governmental authority, bureau or agency is required in
            connection with the execution, delivery and performance of, and
            payment under, this Guaranty, except such consents as have been
            duly obtained; and

                  (e) the execution, delivery, performance and payment of this
            Guaranty by Holdings do not and will not contravene any applicable
            law, regulation, order or decree, the organizational or governing
            documents of Holdings and do not and will not constitute a default
            under any provision of any indenture, mortgage, contract or other
            agreement to which Holdings is a party or by which any of its assets
            may be bound, which default could have a material adverse effect on
            Holdings' business or financial condition.

            SECTION 3. NOTICES. All notices to Holdings under this Guaranty,
until Holdings furnishes written notice to the contrary, shall be in writing and
mailed, faxed or delivered to Atlas Air Worldwide Holdings, Inc., 2000
Westchester Avenue, Purchase, New York 10577-2543, and directed to the attention
of the General Counsel of Atlas Air Worldwide Holdings, Inc. (facsimile no.
(914) 701-8333).

            SECTION 4. MISCELLANEOUS. (a) This Guaranty shall: (i) be binding
upon Holdings, its successors and permitted assigns (including any
debtor-in-possession on behalf of Holdings); (ii) inure to the benefit of, and
be enforceable by, the Guaranteed Party and its respective successors and
assigns and its Affiliates (and shall be transferable without Holdings' consent
by the Guaranteed Party in connection with the transfer of the Obligations under
and in accordance with the terms of the Operative Documents), but shall not, and
is not intended to, create rights in any other third parties; (iii) not be
waived, amended or modified without the written consent of the Guaranteed Party;
(iv) BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL
OBLIGATIONS LAW) and (v) may not be assigned, delegated, pledged, encumbered,
hypothecated or transferred in whole or in part by Holdings hereunder. Holdings
irrevocably waives, to the fullest extent



permitted by applicable law, any and all right to trial by jury in any legal
proceeding arising out of or relating to this Guaranty or the transactions
contemplated hereby.

            (b) No failure or delay on the part of the Guaranteed Party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any delay or single or partial exercise of any right, power
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
provided in and contemplated by this Guaranty are cumulative and not exclusive
of any rights or remedies provided by law or at equity.

            (c) Holdings irrevocably agrees for the benefit of the Guaranteed
Party, by execution and delivery of this Guaranty, that any legal action or
proceeding brought against Holdings with respect to this Guaranty or the
transactions contemplated hereby or by the Operative Documents may be brought
and determined in the courts of the State of New York, New York County, or in
the United States District Court for the Southern District of New York located
in the Borough of Manhattan and Holdings hereby irrevocably accepts with regard
to any such action or proceeding, for itself and in respect of its properties,
generally and unconditionally, the non-exclusive jurisdiction of the aforesaid
courts. Nothing herein shall affect the right of the Guaranteed Party to serve
process in any manner permitted by law as to commence legal proceedings or
otherwise to proceed against Holdings in any other jurisdiction in which
Holdings may be subject to suit.

            (d) Any provision of this Guaranty which is determined by competent
authority to be prohibited and unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

            SECTION 5. INTERPRETATION. The headings of the sections and other
subdivisions of this Guaranty are inserted for convenience only and shall not be
deemed to constitute a part hereof.

            SECTION 6. ATTORNEY'S COST. Holdings agrees to pay all reasonable
attorney's fees and disbursements and all other actual costs and expenses that
may be incurred by the Guaranteed Party in the enforcement of this Guaranty,
whether or not an action at law is commenced with respect hereto.

            SECTION 7. WAIVER. In addition to the waivers contained in Section 4
hereof, Holdings waives, and agrees that it shall not at any time insist upon,
plead or claim any appraisal, valuation, stay, extension, marshaling of assets
or redemption laws, or exemption (which would not have been available to Polar),
whether now or at any time hereafter in force, which will delay, prevent or
otherwise affect the performance by Holdings of its performance and payment
obligations under, or materially and adversely affect the enforcement by the



Guaranteed Party of, this Guaranty. Holdings hereby waives the benefit of all
provisions of law which conflict with the terms of this Guaranty. Holdings
represents, warrants and agrees that, as of the date of this Guaranty, its
obligations under this Guaranty are not subject to any offsets or defenses
against the Guaranteed Party.

            SECTION 8. REINSTATEMENT. This Guaranty shall remain in full force
and effect and continue to be effective should any petition be filed by or
against Polar or Holdings for liquidation or reorganization, should Polar or
Holdings become insolvent or make an assignment for the benefit of creditors or
should a receiver or trustee be appointed for all or any significant part of
such Polar's or Holdings' assets, and shall continue to be effective or be
reinstated, as the case may be, if at any time payment and performance of the
Obligations, or any part thereof, pursuant to applicable law, is rescinded or
reduced in amount, or must otherwise be restored or returned by the Guaranteed
Party, whether as a "voidable preference", "fraudulent conveyance", or
otherwise, all as though such payment or performance had not been made. In the
event that any payment or performance, or any part thereof, is rescinded,
reduced, restored or returned, the related payment or obligation shall be
reinstated and deemed reduced only by such amount paid or performance received
and not so rescinded, reduced, restored or returned.

            SECTION 9. CURRENCY OF PAYMENT. Any payment to be made by Holdings
shall be made on an after-tax basis in the same currency as designated for
payment in the Lease and such designation of the currency of payment is of the
essence.

                            [SIGNATURE PAGE FOLLOWS]



            IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be
executed by its duly authorized officer as of the day, month and year first
above written.

                                           ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                           By: /s/ William C. Bradley
                                               ---------------------------------
                                               Name: William C. Bradley
                                               Title: Vice President & Treasurer

                          ACKNOWLEDGMENT AND ACCEPTANCE

Polaris Aircraft (Pacific Rim), Inc. hereby acknowledges and accepts the
provisions of the foregoing Guaranty.

                                           POLARIS AIRCRAFT (PACIFIC RIM), INC.


                                           By:
                                               ---------------------------------
                                               Name:
                                               Title:

                       [SIGNATURE PAGE FOR GUARANTY 22237]



            IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be
executed by its duly authorized officer as of the day, month and year first
above written.

                                           ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                           By:
                                               ---------------------------------
                                               Name:
                                               Title:

                          ACKNOWLEDGMENT AND ACCEPTANCE

Polaris Aircraft (Pacific Rim), Inc. hereby acknowledges and accepts the
provisions of the foregoing Guaranty.

                                           POLARIS AIRCRAFT (PACIFIC RIM), INC.


                                           By: /s/ Keith A. Helming
                                               ---------------------------------
                                               Name: /s/ Keith A. Helming
                                               Title: Vice President

                       [SIGNATURE PAGE FOR GUARANTY 22237]

EX-10.9.2

                                                                  EXHIBIT 10.9.2


                     SECOND AMENDMENT AGREEMENT (MSN 30808)

                          Dated as of January 31, 2005

                                     Between

                      GENERAL ELECTRIC CAPITAL CORPORATION,
                                  as Sublessor

                                       and

                             POLAR AIR CARGO, INC.,
                                  as Sublessee

                                  in respect of

                               SUBLEASE AGREEMENT

                          Dated as of October 24, 2001

                                  Pertaining to

                          One Boeing 747-46NF Aircraft
                     Manufacturer's Serial Number 30808 and
                    United States Registration Number N450PA

- --------------------------------------------------------------------------------

      As set forth in Section 21 of the Sublease, Sublessor has assigned to the
Owner Trustee (as defined in the Sublease) certain of its right, title and
interest in and to the Sublease, and the Owner Trustee has further assigned such
right, title and interest to the Indenture Trustee (as defined in the Sublease).
To the extent, if any, that this Second Amendment Agreement constitutes chattel
paper (as such term is defined in the Uniform Commercial Code as in effect in
any applicable jurisdiction) no security interest in this Second Amendment
Agreement may be created through the transfer or possession of any counterpart
other than the original executed counterpart, which shall be identified as the
counterpart containing the receipt therefor executed by the Indenture Trustee on
the signature page thereof.



                     SECOND AMENDMENT AGREEMENT (MSN 30808)

            This SECOND AMENDMENT AGREEMENT (MSN 30808) (this "AGREEMENT"),
dated as of January 31, 2005, between GENERAL ELECTRIC CAPITAL CORPORATION, a
corporation organized and existing pursuant to the laws of the State of Delaware
("SUBLESSOR"), and POLAR AIR CARGO, INC., a corporation organized and existing
pursuant to the laws of the State of California ("SUBLESSEE").

                              W I T N E S S E T H:

            WHEREAS, Sublessor and Sublessee are parties to the Sublease (such
term and all other capitalized terms used in these recitals but not defined in
these recitals having the meaning ascribed in Section 1 hereof), under and
pursuant to which Sublessor subleased to Sublessee, and Sublessee subleased from
Sublessor, the aircraft and the engines described therein (the Sublease and
such aircraft and engines being described on ANNEX I attached hereto);

            WHEREAS, Sublessor and Sublessee desire to amend the Sublease in
order to change Sublessee's ability to purchase the Aircraft on the EBO Date
from an amount equal to the EBO Amount to an amount equal to the greater of fair
market sales value of the Aircraft and the EBO Amount; and

            WHEREAS, concurrently with the execution and delivery hereof, the
Guarantor is executing and delivering an acknowledgement, consent and agreement
(MSN 30808) in the form attached as Annex II hereto.

            NOW THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Sublessor and Sublessee agree as follows:

            SECTION 1. DEFINITIONS.

            Unless otherwise specifically defined herein, all capitalized terms
used herein have the meanings stated in the Sublease, as amended.

            SECTION 2. AMENDMENT OF THE SUBLEASE. The Sublease is hereby amended
as follows:

            (a) AMENDMENT OF SECTION 19(b). The first paragraph of Section 19(b)
of the Sublease is amended to read in its entirety as follows:

                  (b) PURCHASE OPTIONS. Sublessee shall have the option, (i)
            upon at least thirty (30) days irrevocable prior written notice to
            Sublessor prior to the EBO Date with respect to the purchase option
            set forth in clause (1) below and (ii) upon at least two hundred
            twenty-five (225) days irrevocable prior written notice to Sublessor
            prior to the relevant purchase date (each a "PURCHASE OPTION DATE")
            with respect to the purchase options set forth in CLAUSES (2) and
            (3) below,


                                      -2-


            to terminate this Sublease and to purchase the Aircraft: (1) on an
            EBO Date, for a purchase price equal to the greater of fair market
            sales value of the Aircraft on such date and the EBO Amount set
            forth on EXHIBIT D; (2) on the last Business Day of the Basic Term
            for a purchase price equal to the greater of fair market sales value
            of the Aircraft on such date and the EBO Amount set forth on EXHIBIT
            D; or (3) on the last Business Day of any Renewal Term or
            Additional Renewal Term for a purchase price equal to the greater of
            the fair market sales value of the Aircraft on such date and the EBO
            Amount set forth on EXHIBIT D; provided that Sublessee shall not be
            entitled to exercise any of the foregoing purchase options at any
            time a Sublease Event of Default of the type described in
            SECTIONS 14(e) or (f) has occurred and is continuing, in each case
            unless Sublessee has obtained a final, non-appealable order from the
            applicable bankruptcy court or other court having jurisdiction over
            the applicable proceeding authorizing the purchase of the Aircraft
            and the payment of the full purchase price therefor. For the
            avoidance of doubt, if a Sublease Event of Default or Default exists
            under SECTION 14(a) or 14(b) hereof, Sublessee may not exercise the
            foregoing purchase options unless at or prior to the time it
            purchases the Aircraft, Sublessee pays all amounts due to Sublessor
            under the Operative Documents, thereby curing any such SECTION 14(a)
            or 14(b) Default or Sublease Event of Default.

            (B) AMENDMENT OF SECTION 19(c). Section 19(c) of the Sublease is
amended by changing the first sentence thereof to read in its entirety as
follows:

                        (c) VALUATION. At any time not earlier than three
            hundred sixty-five (365) days prior to the date on which Sublessee
            may purchase the Aircraft pursuant to SECTION 19(b)(1), (b)(2) or
            (b)(3) hereof or renew this Sublease pursuant to SECTION 19(a)(1)
            hereof, Sublessee may deliver to Sublessor a revocable notice of its
            intent to exercise its renewal option or purchase option.

            SECTION 3. FURTHER ASSURANCES; EXPENSES. Each of Sublessor and
Sublessee agrees to do such further acts and things or cause to be performed
such further acts and things, including, without limitation, execute and
deliver, or cause to be executed and delivered, such agreements and other
documents, as the other party hereto shall reasonably require or deem advisable
to effectuate the purposes of this Agreement or to better assure or confirm its
rights and remedies hereunder or thereunder. Sublessee agrees to pay all direct,
reasonable, out-of-pocket expenses of Sublessor incurred pursuant to this
Section 3 or otherwise in connection with the preparation, execution and
delivery of this Amendment.

            SECTION 4. SUBLEASE. Except as amended by this Amendment, the
Sublease remains unchanged and in full force and effect,

            SECTION 5. MISCELLANEOUS. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or


                                      -3-


render unenforceable such provision in any other jurisdiction. No term or
provision of this Agreement may be changed, waived, discharged or terminated
orally, but only by an instrument in writing signed by Sublessor and Sublessee.
The section and paragraph headings in this Agreement are for convenience of
reference only and shall not modify, define, expand or limit any of the terms or
provisions hereof and all references herein to numbered sections, unless
otherwise indicated, are to sections of this Agreement. This Agreement shall
inure to the benefit of, and shall be binding upon, Sublessor and Sublessee and
their respective successors and permitted assigns. All references herein to a
Person shall mean and include any successor to such Person. This Agreement, the
Amendment Agreement, the Tax Indemnification Agreement Amendment, the
Restructuring Letter Agreement and the Operative Documents (i) constitute the
entire agreement of the parties hereto with respect to the subject matter hereof
and thereof, (ii) supersede all prior and contemporaneous understandings and
agreements of such parties with respect to such subject matter and (iii) may not
be contradicted by evidence of prior, contemporaneous or subsequent oral
agreements of the parties hereto with respect to such subject matter and there
are no oral agreements of the parties hereto with respect to such subject
matter. THIS AGREEMENT HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL IN
ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE. This Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all such counterparts shall together constitute but one and the same
instrument.

                            [Signature Page Follows]



            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers thereunto duly authorized.

                                          GENERAL ELECTRIC CAPITAL
                                           CORPORATION, as Sublessor

                                          By: /s/ Norman Liu
                                              ----------------------------------
                                              Name:  Norman Liu
                                              Title: Vice President


                                          POLAR AIR CARGO, INC.,
                                           as Sublessee

                                          By: /s/ Dorinda Pannozzo
                                              ----------------------------------
                                              Name: Dorinda Pannozzo
                                              Title: Assistant Treasurer


           [Signature Page to Second Amendment Agreement (MSN 30808)]



                                                                         ANNEX I
                                                                              to
                                                      Second Amendment Agreement
                                                                     (MSN 30808)

                             DESCRIPTION OF SUBLEASE

            Sublease Agreement, dated as of October 24, 2001, between General
Electric Capital Corporation, as sublessor, and Polar Air Cargo, Inc., as
sublessee, as supplemented by Sublease Supplement No. 1, dated November 19,2001,
recorded by the Federal Aviation Administration on December 7, 2001 as
Conveyance No. X144235, as amended by Amendment Agreement (MSN 30808), dated as
of August 1, 2003 between General Electric Capital Corporation, as sublessor,
and Polar Air Cargo, Inc., as sublessee, recorded by the Federal Aviation
Administration on January 13, 2004 as Conveyance No. SS020609.

                             DESCRIPTION OF AIRCRAFT

            One Boeing 747-46NF Aircraft bearing Manufacturer's Serial No. 30808
and United States Registration No. N450PA.

            Four General Electric Model CF6-80C2-B5F Engines bearing
Manufacturer's Serial Nos. 706198, 706199, 706200 and 706201 (each of which has
750 or more rated takeoff horsepower or the equivalent of such horsepower).



                                                                        ANNEX II
                                                                              to
                                                      Second Amendment Agreement
                                                                     (MSN 30808)

                                     FORM OF
                ACKNOWLEDGMENT, CONSENT AND AGREEMENT (MSN 30808)

            ATLAS AIR WORLDWIDE HOLDINGS, INC., a Delaware corporation
("GUARANTOR"), with reference to the Guaranty, dated as of November 19, 2001
(the "GUARANTY"), made by Guarantor in favor of General Electric Capital
Corporation and its successors and assigns ("GUARANTEED PARTY"), relating to the
Sublease Agreement (MSN 30808), dated as of October 24, 2001 between General
Electric Capital Corporation, as sublessor ("SUBLESSOR"), and Polar Air Cargo,
Inc., as sublessee ("SUBLESSEE"), as amended by that certain Amendment Agreement
(MSN 30808), dated as of August 1, 2003, between Sublessor and Sublessee (as so
amended, the "SUBLEASE"; capitalized terms used herein but not defined herein
having the meanings stated or ascribed in the Sublease) and to the other
Operative Document, DOES HEREBY (in each case, for the benefit of the Guaranteed
Party and, in each case (except to the extent otherwise provided herein),
without limitation of any term or provision of the Guaranty):

                  (i) ACKNOWLEDGE receipt (pursuant to and as required by the
            Guaranty) of notice of the amendment of the Sublease pursuant to
            Second Amendment Agreement (MSN 30808), dated as of January ____,
            2005, between Sublessor and Sublessee (the "SUBLEASE SECOND
            AMENDMENT");

                  (ii) CONSENT to (a) the terms and provisions of the Sublease
            Second Amendment, (b) the execution, delivery and performance
            thereof by Sublessor and Sublessee, and (c) the amendment of the
            Sublease pursuant thereto and on the terms provided therein;

                  (iii) AGREE that, from and after the execution and delivery of
            the Sublease Second Amendment, (a) any reference in the Guaranty,
            the Sublease or any other Operative Document, or otherwise by
            Guarantor, to the Sublease shall mean the Sublease, as amended by
            the Sublease Second Amendment, and (b) any reference by Guarantor
            or Guaranteed Party to the Guaranty shall mean the Guaranty, as
            supplemented hereby; and

                  (iv) AGREE that, except as supplemented hereby, the Guaranty
            shall remain in full force and effect as in existence on the date
            hereof and is hereby ratified and confirmed in all respects.


                            [Signature Page Follows]


                                      -2-


            IN WITNESS WHEREOF, Guarantor has caused this Acknowledgment,
Consent and Agreement to be executed and delivered as of this day of January
2005.

                                              ATLAS AIR WORLDWIDE HOLDINGS, INC.


                                              BY:
                                                 ------------------------------
                                                  Name:
                                                  Title:


      [Signature Page to Acknowledgment, Consent and Agreement (MSN 30808)]




                           SCHEDULE TO EXHIBIT 10.9.2

The agreements listed below are substantially identical to this exhibit and are
not being filed separately as exhibits pursuant to instruction 2 to Regulation
S-K, Item 601.


- -------------------- ------------------------ ---------------- ------------------------- --------------------------------
REGISTRATION         MANUFACTURER'S SERIAL    SUBLESSEE        SUBLESSOR                 AGREEMENT
NUMBER               NUMBER(S)
- -------------------- ------------------------ ---------------- ------------------------- --------------------------------
                                                                             
N451PA               30809                    Polar Air        General Electric          Second Amendment Agreement
                                              Cargo, Inc.      Capital Corporation       dated January 31, 2005 between
                                                                                         General Electric Capital
                                                                                         Corporation, as Sublessor and
                                                                                         Polar Air Cargo, Inc. as
                                                                                         Sublessee in respect of
                                                                                         Sublease dated October 24,
                                                                                         2001 with respect to Aircraft
                                                                                         N451PA
- -------------------- ------------------------ ---------------- ------------------------- --------------------------------
N452PA               30810                    Polar Air        General Electric          Second Amendment Agreement
                                              Cargo, Inc.      Capital Corporation       dated January 31, 2005 between
                                                                                         General Electric Capital
                                                                                         Corporation, as Sublessor and
                                                                                         Polar Air Cargo, Inc. as
                                                                                         Sublessee in respect of
                                                                                         Sublease dated October 24,
                                                                                         2001 with respect to Aircraft
                                                                                         N452PA
- -------------------- ------------------------ ---------------- ------------------------- --------------------------------
N453PA               30811                    Polar Air        General Electric          Second Amendment Agreement
                                              Cargo, Inc.      Capital Corporation       dated January 31, 2005 between
                                                                                         General Electric Capital
                                                                                         Corporation, as Sublessor and
                                                                                         Polar Air Cargo, Inc. as
                                                                                         Sublessee in respect of
                                                                                         Sublease dated October 24,
                                                                                         2001 with respect to Aircraft
                                                                                         N453PA
- -------------------- ------------------------ ---------------- ------------------------- --------------------------------

EX-10.16.1

                                                                 EXHIBIT 10.16.1


                              AMENDED AND RESTATED

                              EMPLOYMENT AGREEMENT

                  This Amended and Restated Employment Agreement (hereinafter
referred to as the "Agreement") is made and entered into as of the 1st day of
April, 2005 by and between Jeffrey Erickson (hereinafter referred to as
"Employee") and Atlas Air, Inc., a Delaware corporation (hereinafter referred to
as "Atlas"). This Agreement amends and restates in its entirety that certain
Employment Agreement between the parties dated as of September 1, 2002, as
amended to date.

                  WHEREAS, Atlas believes that it is in the best interests of
Atlas to retain the services of the Employee and the Employee desires an
affiliation with Atlas, on the terms and subject to the conditions set forth in
this Agreement; and

                  WHEREAS, Employee warrants that Employee is entering
voluntarily into this Agreement, and that no promises or inducements for this
Agreement have been made outside of the terms and conditions referred to herein,
and Employee enters into this Agreement without reliance upon any statement or
representation by Atlas or any other person, concerning any fact material
hereto.

                  NOW, THEREFORE, in consideration of the mutual covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto, intending to be
legally bound hereby, covenant and agree as follows:

1.       DEFINITIONS

                  1.1 For purposes of this Agreement, "CAUSE" as used herein
means (i) any act or acts of material dishonesty taken by the Employee, (ii) the
failure of the Employee to comply


                                       1


with any of the Employee's material obligations within ten (10) days of written
notice from Atlas, (iii) any material violations by Employee of Atlas corporate
policies as set forth in the Employee Compliance Manual, Employee Handbook or
related corporate policies; provided that, if such violation is subject to cure,
Employee shal1 have ten (10) days within which to cure such- violation, or (iv)
the conviction of or "no contest" plea by the Employee to any misdemeanor of
moral turpitude or any felony.

                  1.2 "EMPLOYMENT PERIOD" shall be defined as the period
commencing on the date hereof and extending until this Agreement is terminated
by either party in accordance with Section 4.

                  1.3 "PERMANENT DISABILITY" as used herein shall be deemed to
have been sustained by Employee if Employee shall have been continuously
disabled from performing the duties assigned to Employee during the Employment
Period for a period of six (6) consecutive calendar months, and such Permanent
Disability shall be deemed to have commenced on the day following the end of
such six (6) consecutive calendar months.

                  1.4 "CONFIDENTIAL OR PROPRIETARY" as used herein shall refer
to all information relative to the plans, structure and practices, including
information relating to its customers, contracts and aircraft of Atlas, Atlas
Worldwide Holdings, Inc. ("Holdings") or any affiliate or subsidiary thereof,
except:

                  (a) information that is or becomes a matter of public
knowledge through no fault of the Employee; or

                  (b) information rightfully received by the Employee from a
third party without a duty of confidentiality; or


                                       2


                  (c) information disclosed to Employee with Atlas' prior
written approval for public dissemination.

                  1.5 "GOOD REASON" as used herein means (i) a reduction during
the term of this Agreement in the Employee's Base Annual Salary or eligibility
to receive a bonus or other benefits provided to officers of Atlas, (ii) a
substantial and material reduction in the Employee's title or job
responsibilities from the Employee's title or job responsibilities on the date
of this Agreement, (iii) any reduction, within twelve (12) months following a
Change of Control, in the Employee's title or job responsibilities from the
Employee's title or job responsibilities on the date of this Agreement, and (iv)
a requirement by Atlas, within twelve (12) months following a Change of Control,
that Employee relocate his principal residence from the Purchase, New York area.
For purposes of this Section 1.5, "Change of Control" shall mean the acquisition
by any person, entity or "group" within the meaning of Section 13 (d) (3) or 14
(d) (2) of the Securities Exchange Act of 1934 (the "Exchange Act") (excluding,
for this purpose any employee benefit plan of Atlas, Holdings or its affiliates)
of beneficial ownership, within the meaning of Rule 13(d) (c) promulgated under
the Exchange Act, of greater than fifty percent (50%) of the combined voting
power of the outstanding voting securities of Atlas or Holdings entitled to vote
generally in the election of directors.

2.       EMPLOYMENT AND OBLIGATIONS OF EMPLOYEE

                  Atlas and Employee agree to the following rights, obligations
and duties with respect to employment:

                  2.1 EMPLOYMENT. During the Employment Period, Atlas agrees to
employ the Employee as President and Chief Executive Officer of Atlas and
Holdings. The scope of Employee's responsibilities shall be as determined by the
Boards of Directors of Atlas and/or


                                       3


Holdings. Employee shall not be entitled to any additional compensation for
serving in any other office for Atlas, or Holdings or any subsidiary or
affiliate of Atlas or Holdings.

                  2.2 OBLIGATIONS OF EMPLOYEE. During the Employment Period, the
Employee agrees, except when prevented by illness or Permanent Disability, or
during a period of vacation, to devote substantially all of Employee's business
time and attention to the good faith performance of the duties contemplated.

                  2.3 PRINCIPAL RESIDENCE OF EMPLOYEE. During the Employment
Period, Employee shall maintain Employee's principal residence in the Purchase,
New York area.

3.       COMPENSATION

                  During the Employment Period, Atlas will pay Employee as
follows:

                  3.1 BASE ANNUAL SALARY. Atlas will pay Employee a base annual
salary (the "Base Annual Salary") of USD $524,400 per annum, payable in
semi-monthly installments. The parties acknowledge that $14,400 of the Base
Annual Salary is in partial consideration for the elimination of the automobile
allowance previously provided to Employee. The Company shall review Base Annual
Salary not less frequently than annually for increases, including among other
considerations, Employee's performance, it being understood that any increases
shall be at the discretion of the Company.

                  3.2 INCENTIVE BONUS PAYMENTS. Employee will be eligible to
participate in Holdings' Annual Incentive Plan. The level of the bonus available
to the Employee will be set forth in the Annual Incentive Plan and will be
awarded in consideration of individual and Company performance based on
performance goals and objectives determined by the Compensation Committee. A
fuller description of how corporate and individual performance operate in tandem
to determine the calculation of bonuses for your position will be described in
the Annual Incentive Plan. The Annual Incentive Plan document will be developed


                                       4


by the Compensation Committee and is subject to amendment from time to time with
changes as adopted by the Compensation Committee or full Board of Directors. As
further described in the Annual Incentive Plan (i) corporate and individual
performance in combination may permit the employee to earn a target bonus equal
to 50% of Base Annual Salary, (ii) lesser corporate or individual performance
may cause bonus payments to be in an amount less than 50% of Base Annual Salary
or result in no bonus being payable and (iii) greater corporate and individual
performances may result in the bonus being more than 50% of Base Annual Salary.
When the bonus payment reaches more than 50% of Base Annual Salary, the Company
reserves the right to pay some or all of the portion of the bonus that is above
50% of Base Annual Salary in Holdings unrestricted company stock. Any bonus paid
under the Annual Incentive Plan will be paid no later than two weeks following
the completion of the year-end audit for the applicable year.

                  3.3 BENEFITS. Employee and Employee's dependents shall be
entitled to participate in the Atlas health insurance plan, provided that the
Employee and Atlas will each contribute to Employee's monthly premium as
provided by such plan. Atlas reserves the right to discontinue participation in
any health insurance plan at any time with the understanding that Atlas will
comply in full measure with all state and federal laws regarding the changes of
insurance coverage by private employers and notification under the Consolidated
Omnibus Budget Reconciliation Act. Employee also shall be entitled, to the same
extent and at a level commensurate with the corporate officers of Atlas, to
participate in any other benefit plans or arrangements of Atlas.

                  3.4 FRINGE BENEFITS. Employee will receive a one-time cash
payment of $20,000 in lieu of the tax gross-up related to the previously
provided automobile allowance.


                                       5


This payment shall be made within ten (10) days of the signing of this
Agreement, and shall be subject to required tax withholding.

4.       TERMINATION OF EMPLOYMENT PERIOD

                  The Employment Period shall terminate under the following
terms and conditions:

                  4.1 AT WILL ARRANGEMENT. Atlas and Employee expressly
understand and agree that the employment relationship is at-will. Either party
may terminate the Employment Period and the employment relationship upon written
notice to the other at any time and for any reason. Employee shall make every
reasonable effort to give Atlas at least three months prior, written notice of
Employee's voluntary termination of employment for other than Good Reason.

                  4.2 RIGHTS FOLLOWING TERMINATION.

                  (a) If the Employment Period is terminated by Atlas for
reasons other than Cause or if the Employment Period is terminated by the
Employee or Good Reason, and subject to Employee's execution of a release upon
terms and conditions acceptable to Atlas, the Employee shall be entitled to: (i)
receive an amount equal to one and one-half times Employee's then current Annual
Base Salary, payable in accordance with Atlas' normal pay schedule; and (ii)
continued coverage and rights and benefits available under the employee benefit
programs of Atlas as provided in Section 3.3 above for a period of 12 months
from the date of termination; PROVIDED, HOWEVER, that any such continued
coverage shall cease in the event Employee obtains comparable coverage in
connection with subsequent employment, and to the extent Atlas is unable to
continue such coverage, Atlas shall provide the Employee with economically
equivalent benefits determined on an after-tax basis.

                  (b) Upon the death or Permanent Disability of the Employee,
the Employment Period shall terminate and the Employee's Base Annual Salary
which is accrued for the current pay period but unpaid as of the date of such
death or Permanent Disability shall be paid to the


                                       6


Employee or Employee's personal representative. In addition, upon the Permanent
Disability of the Employee, Employee shall be entitled to the compensation and
benefits set forth in Section 4.2 (a) (i) and (ii) above, and upon the death of
Employee, Employee's immediate family shall be entitled to the compensation and
benefits set forth in Section 4.2 (a) (i) and (ii) above.

                  (c) If the Employment Period is terminated by Atlas for Cause
or by the Employee for other than Good Reason, the Employee shall be entitled to
receive Employee's Base Annual Salary which is accrued for the current pay
period but unpaid as of the date of termination.

                  4.3 NON-COMPETITION PROVISION. (a) Employee covenants and
agrees that except when required to do so in the ordinary course of his duties,
Employee will not, at any time, reveal, divulge or make known to any third party
any confidential or proprietary records, data, trade secrets, pricing policies,
strategy, rate structure, personnel policy, management methods, financial
reports, methods or practice of obtaining or doing business, or any other
confidential, or proprietary information of Holdings, Atlas or any of their
subsidiaries or affiliates (collectively the "Atlas Companies" and each, an
"Atlas Company") which is not in the public domain.

                  (b) In addition, Employee covenants and agrees that, at no
time before the second anniversary of Employee's termination of employment with
Atlas, will Employee engage in any of the following activities directly or
indirectly, for any reason, whether for Employee's own account or for the
account of any other person, firm, corporation or other organization:

                  (i)   solicit, employ or otherwise interfere with any of the
                        Atlas Companies contracts or relationships with any
                        client, employee, officer, director or any independent
                        contractor whether the person is employed by or
                        associated with an Atlas Company on the date of this
                        Agreement or at any time thereafter; or


                                       7


                  (ii)  solicit, accept or otherwise interfere with any of the
                        Atlas Companies' contracts or relationships with any
                        independent contractor, customer, client or supplier, or
                        any person who is a bona fide prospective independent
                        contractor, customer, client or supplier of an Atlas
                        Company.

                  (c) In addition, Employee covenants and agrees that, at no
time before the first anniversary of Employee's termination of employment with
Atlas, will Employee directly or indirectly, for any reason, whether for
Employee's own account or for the account of any other person, firm, corporation
or other organization, accept employment with, or give advice to, (i) any air,
cargo carrier, (ii) any air cargo division or affiliate of any other airline or
(iii) any company that leases cargo aircraft on an ACMI, wet lease, charter or
dry lease basis. The parties agree and intend that breach of this
non-competition clause shall subject Employee to the full measure of contract
and equitable damages.

5.   DISPUTE RESOLUTION AND CHOICE OF LAW

                  5.1 NEGOTIATION. If a dispute between the Parties arises under
this Agreement, the Parties shall negotiate in good faith in an attempt to
resolve their differences. The obligation of the Parties to negotiate in good
faith shall commence immediately, and shall continue for a period of at least
thirty (30) days ("Negotiation").

                  If Negotiation fails to resolve a dispute between the Parties
within the first thirty (30) days, either Party may proceed to demand mediation
("Mediation"). Upon agreement of both Parties, arbitration may be initiated
immediately, in lieu of Mediation.

                  5.2 MEDIATION. If a dispute between the Parties arises under
this Agreement and has not been resolved under the Negotiation procedures
described herein, either Party may require, by written notice to the other
Party, that Negotiation be facilitated by a single mediator, to be selected by
the Parties (the "Mediator").




                                       8


                  The Parties shall select the Mediator within ten (10) days
after receipt of notice. If the Parties are unable to agree on the Mediator, the
Mediator shall be selected by Atlas, but the selected Mediator shall be
independent of Atlas and its affiliates. The fees of the Mediator shall be
divided equally between the Parties.

                  With the assistance of the Mediator, the Parties shall
continue Negotiation in good faith for a period not to exceed thirty (30) days.
If the Parties are unable to reach agreement during this period, the Mediator
shall be discharged and the Parties' obligations under this Mediation section
shall be deemed satisfied.

                  5.3 ARBITRATION. Subject to the duty to negotiate and mediate
set forth above, all disputes, claims, or causes of action arising out of or
relating to this Agreement or the validity, interpretation, breach, violation,
or termination thereof not resolved by Mediation, shall be finally and solely
determined and settled by arbitration, to be conducted in the State of New York,
USA, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association ("AAA") in effect at the date of arbitration
("Arbitration"). This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without reference to principles of
conflict of laws.

                  Any Arbitration commenced pursuant to this Agreement shall be
conducted by a single neutral arbitrator, who shall have a minimum of three (3)
years of commercial experience (the "Arbitrator"). The Parties shall meet within
ten (10) days of failure to resolve by Mediation to attempt to agree on an
Arbitrator. Absent agreement at this meeting, the Arbitrator shall be selected
by AAA. Such Arbitrator shall be free of any conflicts with Atlas and shall hold
a hearing within thirty (30) days of the notice to Employee.




                                       9


                  If the terms and conditions of this, Agreement are
inconsistent with the Commercial Arbitration Rules of the AAA, the terms and
conditions of this Agreement shall control.

                  The Parties hereby consent to any process, notice, or other
application to said courts and any document in connection with Arbitration may
be served by (i) certified mail, return receipt requested; (ii) by personal
service; or (iii) in such other manner as may be permissible under the rules of
the applicable court or Arbitration tribunal; PROVIDED, HOWEVER, a reasonable
time for appearance is allowed. The Parties further agree that Arbitration
proceedings must be instituted within one (1) year after the occurrence of any
dispute, and failure to institute Arbitration proceedings within such time
period shall constitute an absolute bar to the institution of any proceedings
and a waiver of all claims. The Parties shall equally divide all costs and
expenses incurred in such, proceeding and related legal proceedings, unless
otherwise determined by the Arbitrator. The Judgment of the Arbitrator shall be
final and either Party may submit such decision to courts for enforcement
thereof.

6.       SEVERABILITY AND ENFORCEABILITY

                  It is expressly acknowledged and agreed that the covenants and
provisions, hereof are separable; that the enforceability of one covenant or
provision shall in no event affect the full enforceability of any other covenant
or provision herein. Further, it is agreed that, in the event any covenant or
provision of this Agreement is found by any court of competent jurisdiction or
Arbitrator to be unenforceable, illegal or invalid, such invalidity, illegality
or unenforceability shall not affect the validity or enforceability of any other
covenant or provision of this Agreement. In the event a court of competent
jurisdiction or an Arbitrator would otherwise hold any part hereof unenforceable
by reason of its geographic or business scope or duration, said part


                                       10


shall be construed as if its geographic or business, scope or duration had been
more narrowly drafted so as not to be invalid or unenforceable.

7.       MISCELLANEOUS

                  7.1 NO MITIGATION. The amounts to be paid to Employee are net
to Employee, without any reduction or duty to mitigate, except for taxes, other
governmental charges or amounts owed to Atlas by Employee, and all payments to
be made hereunder shall be net of all applicable income and employment taxes
required to be withheld therefrom.

                  7.2 PRO-RATION. In the event the Employment Period is
terminated in the middle of any calendar month, the amount due for such month
shall be pro-rated on a daily basis.

                  7.3 NO WAIVER EXCEPT IN WRITING. No waiver, or modification of
this Agreement or any of the terms and conditions set forth herein shall be
effective unless submitted to a writing duly executed by the parties.

                  7.4 SUCCESSORS AND ASSIGNS. This Agreement shall be binding on
Atlas and any successor thereto, whether by reason of merger, consolidation or
otherwise. The duties and obligations of Employee may not be assigned by
Employee.

                  7.5 CONFIDENTIALITY OF TERMS. Atlas, and Employee agree that
the terms and conditions of this Agreement are confidential and that they will
not disclose the terms of this Agreement to any third parties, other than the
Employee's spouse, their attorneys, auditors, accountants or as required by law
or as may be necessary to enforce this Agreement.

                  7.6 FULL UNDERSTANDING. Employee declares and represents that
Employee has carefully read and fully understands the terms of this Agreement,
has had the opportunity to obtain advice and assistance of counsel with respect
thereto, and knowingly and of Employee's own free will, without any duress,
being fully informed and after due deliberation, voluntarily


                                       11


accepts the terms of this Agreement and represents that the execution, delivery
and performance of this Agreement does not violate any agreement to which
Employee is subject.

                  7.7 ENTIRE AGREEMENT. This Agreement sets forth the entire
agreement and understanding between the parties with respect to the subject
matter hereof and supersedes all prior agreements, arrangements, and
understandings between the parties with respect to the subject matter hereof.

                  IN WITNESS WHEREOF, the parties hereto have executed this
agreement the date, and year first above written.

EMPLOYEE                                     ATLAS AIR, INC.

/s/ Jeffrey Erickson                         /s/ Illegible
- -----------------------------                -----------------------------
Jeffrey Erickson
















                                       12

EX-10.17.1

                                                                 EXHIBIT 10.17.1


                              EMPLOYMENT AGREEMENT


            This Employment Agreement (hereinafter referred to as the
"Agreement") is made and entered into as of the 1st day of February, 2003, by
and between Wakelee Smith (hereinafter referred to as "Employee") and Atlas Air
Worldwide Holdings, Inc., a Delaware corporation (hereinafter referred to as
"Atlas" or the "Company").

            WHEREAS, Atlas believes that it is in the best interests of Atlas to
retain the services of the Employee and the Employee desires an affiliation with
Atlas, on the terms and subject to the conditions set forth in this Agreement;
and

            WHEREAS, Employee warrants that Employee is entering voluntarily
into this Agreement, and that no promises or inducements for this Agreement have
been made outside of the terms and conditions referred to herein, and Employee
enters into this Agreement without reliance upon any statement or representation
by Atlas or any other person, concerning any fact material hereto.

            NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto, intending to be legally
bound hereby, covenant and agree as follows:

1.    DEFINITIONS

            1.1   For purposes of this Agreement, "CAUSE" as used herein means
(i) any act or acts of material dishonesty taken by the Employee, (ii) the
failure of the Employee to comply




with any of the Employee's obligations within ten (10) days of written notice
from Atlas, (iii) any violation by Employee of Atlas corporate policies as set
forth in the Employee Compliance Manual, Employee Handbook or related corporate
policies of which Employee has received written notice; provided that, if such
violation is subject to cure, Employee shall have ten (10) days within which to
cure such violation after receipt of written notice thereof, or (iv) the
conviction of or "no contest" plea by the Employee to any misdemeanor of moral
turpitude or any felony.

            1.2   "EMPLOYMENT PERIOD" shall be defined as the period commencing
on the date hereof and extending until January 31, 2008, subject to earlier
termination as set forth in Section 4 below and extension as provided in the
next succeeding sentence. On February 1, 2008 and on each anniversary
thereafter, the Employment Period shall be automatically extended for an
additional one year unless Atlas gives notice in writing to the Employee or the
Employee gives notice in writing to Atlas at least three months prior to
February 1, 2008 or such anniversary, as the case may be, that the Employment
Period is not to be so extended.

            1.3   "PERMANENT DISABILITY" as used herein shall be deemed to have
been sustained by Employee if Employee shall have been continuously disabled
from performing the duties assigned to Employee during the Employment Period for
a period of six (6) consecutive calendar months, and such Permanent Disability
shall be deemed to have commenced on the day following the end of such six (6)
consecutive calendar months.

            1.4   "CONFIDENTIAL OR PROPRIETARY" as used herein shall refer to
all information relative to the plans, structure and practices, including
information relating to its customers, contracts and aircraft of Holdings (as
defined below) or any affiliate or subsidiary thereof, except:

                                     - 2 -



            (a)   information that is or becomes a matter of public knowledge
through no fault of the Employee; or

            (b)   information rightfully received by the Employee from a third
party without a duty of confidentiality; or

            (c)   information disclosed to Employee with Atlas' prior approval
for public dissemination.

            1.5   "GOOD REASON" as used herein means (i) a reduction during the
term of this Agreement in either the Employee's Base Annual Salary or
eligibility to participate in bonus pro-grams or other benefits universally
offered to similarly situated executives, (ii) a substantial and material
reduction in the Employee's title or job responsibilities from the Employee's
then current title or job responsibilities, and (iii) any reduction, within
twelve (12) months following a Change of Control, in the Employee's title or job
responsibilities from the Employee's title or job responsibilities. For purposes
of this Section 1.5, "Change of Control" shall mean the acquisition by any
person, entity or "group" within the meaning of Section 13(d) (3) or 14(d) (2)
of the Securities Exchange Act of 1934 (the "Exchange Act") (excluding, for this
purpose, (x) the Estate of Michael Chowdry, Chowdry Limited Partnership,
Chowdry, Inc., the Chowdry Foundation and Linda H. Chowdry and her family
members and (y) any employee benefit plan of Atlas, Holdings or its affiliates)
of beneficial owner-ship, within the meaning of Rule 13(d) (c) promulgated under
the Exchange Act, of greater than fifty percent (50%) of the combined voting
power of the outstanding voting securities of Holdings entitled to vote
generally in the election of directors.

                                     - 3 -



2.    EMPLOYMENT AND OBLIGATIONS OF EMPLOYEE

            Atlas and Employee agree to the following rights, obligations and
duties with respect to employment:

            2.1   EMPLOYMENT. During the Employment Period, Atlas agrees to
employ the Employee as Vice President, Corporate Planning. The scope of
Employee's responsibilities shall be as determined by the Board of Directors
and/or appropriate officers of Atlas. If the Board of Directors of Atlas
requests Employee to serve in any capacity for Atlas or any of its respective
subsidiaries or affiliates, Employee agrees that Employee shall serve in such
capacity, without any additional compensation.

            2.2   OBLIGATIONS OF EMPLOYEE. During the Employment Period, the
Employee agrees, except when prevented by illness or Permanent Disability or
during a period of vacation, to devote substantially all of Employee's business
time and attention to the good faith performance of the duties contemplated.

3.    COMPENSATION


            During the Employment Period, Atlas will pay Employee as follows:

            3.1   BASE ANNUAL SALARY. Atlas will pay Employee a base annual
salary (the "Base Annual Salary") of Two Hundred Twenty Thousand (USD $
220,000.00) Dollars per annum, payable in semimonthly installments. The Company
shall review Base Salary not less frequently than annually for increases,
including among other considerations, EMPLOYEE's performance, it being
understood that any increases shall be at the discretion of the Company.

            3.2   INCENTIVE BONUS PAYMENTS. Employee will be eligible to receive
an annual incentive bonus under the annual executive incentive program at a
target of 501 of Base Salary

                                     - 4 -



(or such percentage offered to similarly situated executives of the Company)
based on performance, including financial and individual performance for each
calendar year (prorated accordingly for 2003) during the Employment Period upon
approval of the Compensation Committee of the Board of Directors of Atlas (the
"Compensation Committee"). Employee will also be able, subject to eligibility
requirements as set forth in each respective program, to participate in the
Company's, Deferred Compensation Plan, Annual Stock Option Plan, Employee Stock
Purchase Plan, Profit Sharing and 401(k) Plan, or other plans offered to
similarly situated executives, the details of which have already been provided
to Employee. Employee shall also be entitled to a sign on bonus of Twenty
Thousand ($USD 20,000.00) Dollars payable within thirty (30) days of the date of
this Agreement.

            3.3   BENEFITS. Employee and Employee's dependents shall be entitled
to participate in the Atlas health insurance plan, and Atlas will contribute to
Employee's monthly premium as provided by such plan. Atlas reserves the right to
discontinue participation in any health insurance plan at any time with the
understanding that Atlas will comply in full measure with all state and federal
laws regarding the changes of insurance coverage by private employers and
notification under the Consolidated Omnibus Budget Reconciliation Act. Employee
also shall be entitled, to the same extent and at a level commensurate with the
corporate officers of Atlas, to participate in any other benefit plans or
arrangements of Atlas.

            3.4   FRINGE BENEFITS. Employee also will be entitled to
professional and personal use of a company vehicle initially blue-book valued at
up to, or actual purchase price not to exceed, $40,000. Atlas will be
responsible for all expenses related to the vehicle, except for the costs of
fuel. In the event Employee's employment terminates, with or without Cause,

                                     - 5 -



Employee shall, within thirty (30) days of the date of termination, return the
company vehicle to Atlas together with all keys, owners manual(s) and
maintenance records.

            3.5   STOCK OPTIONS. Employee shall be entitled to an initial stock
option grant of 11,250 shares of Common Stock of Holdings. These options shall
vest ratably (i.e. 25% per year) at the end of each of the first four years of
employment, subject to certain vesting rules established by the Board of
Directors or provided in the applicable Stock Option Agreement that will be
provided to Employee. The option exercise price shall be the stock price of
Holdings as of the close of trading on the last business day immediately prior
to the date of this Agreement. All other terms of this grant are contained in
the Stock Option Agreement. Employee shall also be eligible to participate in
the Atlas Annual Incentive Compensation Plan, that is targeted to deliver
additional 11,250 options annually in accordance with the Plan.

4.    TERMINATION OF EMPLOYMENT PERIOD


            The Employment Period shall terminate under the following terms and
conditions:

            4.1   AT WILL ARRANGEMENT. Atlas may terminate the Employment Period
upon written notice to the Employee at any time and for any reason. Atlas and
Employee expressly understand and agree that the employment relationship is
at-will. Atlas is entitled to sever the employment relationship for any reason.
Employee hereby agrees to give Atlas at least three months prior written notice
of Employee's voluntary termination of employment for other than Good Reason.

            4.2   RIGHTS FOLLOWING TERMINATION.

            (a)   If the Employment Period is terminated by Atlas for reasons
other than Cause (including the giving of notice by Atlas pursuant to Section
1.2 hereof of Atlas' election

                                     - 6 -



not to extend the Employment Period) or if the Employment Period is terminated
by the Employee for Good Reason, and subject to Employee's execution of a
release upon terms and conditions acceptable to Atlas, the Employee shall be
entitled to: (i) receive 18 months severance based on Employee's monthly salary;
and (ii) continued coverage and rights and benefits available under the employee
benefit programs of Atlas as provided in Section 3.3 above for a period of 12
months from the date of termination subject to the Employee paying the same
portion for the premiums for such coverage as he paid during his employment with
the Company; PROVIDED, HOWEVER, that any such continued coverage shall cease in
the event Employee obtains comparable coverage in connection with subsequent
employment, and to the extent Atlas is unable to continue such coverage, Atlas
shall provide the Employee with economically equivalent benefits determined on
an after-tax basis.

            (b)   Upon the death or Permanent Disability of the Employee, the
Employment Period shall terminate and the Employee's Base Annual Salary which is
accrued for the current pay period but unpaid as of the date of such death or
Permanent Disability shall be paid to the Employee or Employee's personal
representative. In addition, upon the death or Permanent Disability of the
Employee, Employee or Employee's personal representative shall be entitled to
the compensation and benefits as set forth in Section 4.2 (a) (i) and (ii)
above.

            (c)   If the Employment Period is terminated by Atlas for Cause or
by the Employee for other than Good Reason (including the giving of notice by
Employee pursuant to Section 1.2 hereof of Employee's election not to extend the
Employment Period), the Employee shall be entitled to receive Employee's Base
Annual Salary which is accrued for the current pay period but unpaid as of the
date of termination.

                                     - 7 -



            4.3   NON-COMPETITION PROVISION. (a) Employee covenants and agrees
that Employee will not, at any time, reveal, divulge or make known to any third
party any confidential or proprietary records, data, trade secrets, pricing
policies, strategy, rate structure, personnel policy, management methods,
financial reports, methods or practice of obtaining or doing business, or any
other confidential or proprietary information of Atlas, or any of its
subsidiaries or affiliates (collectively the "Atlas Companies" and each, an
"Atlas Company") which is not in the public domain.

            (b)   In addition, Employee covenants and agrees that, at no time
before eighteen (18) months after Employee's termination of employment with
Atlas, will Employee engage in any of the following activities directly or
indirectly, for any reason, whether for Employee's own account or for the
account of any other person, firm, corporation or other organization:

                  (i)   solicit, employ or otherwise interfere with any of the
                        Atlas Companies' contracts or relation- ships with any
                        client, employee, officer, director or any independent
                        contractor whether the person is employed by or
                        associated with an Atlas Company on the date of this
                        Agreement or at any time thereafter; or

                  (ii)  solicit, accept or otherwise interfere with any of the
                        Atlas Companies' contracts or relationships with any
                        independent contractor, customer, client or supplier, or
                        any person who is a bona fide prospective independent
                        contractor, customer, client or supplier of an Atlas
                        Company.

            (c)   In addition, Employee covenants and agrees that, at no time
before eighteen (18) months after Employee's termination of employment with
Atlas, will Employee directly or indirectly, for any reason, whether for
Employee's own account or for the account of any other person, firm, corporation
or other organization, accept employment with, or give advice to, (i) any air
cargo carrier, (ii) any air cargo division or cargo-affiliate of any other
airline

                                     - 8 -



or (iii) any company that leases cargo aircraft as a significant part of its
business on an ACMI, wet lease, charter or dry lease basis. The parties agree d
intend that breach of this non-competition clause shall a subject Employee to
the full measure of contract and equitable damages.

5.    DISPUTE RESOLUTION AND CHOICE OF LAW

            5.1   NEGOTIATION. If a dispute between the Parties arises under
this Agreement, the Parties shall negotiate in good faith in an attempt to
resolve their differences. The obligation of the Parties to negotiate in good
faith shall commence immediately, and shall continue for a period of at least
thirty (30) days ("Negotiation")

            If Negotiation fails to resolve a dispute between the Parties within
the first thirty (30) days, either Party may proceed to demand mediation
("Mediation"). Upon agreement of both Parties, arbitration may be initiated
immediately, in lieu a of Mediation.

            5.2   MEDIATION. If a dispute between the Parties arises under this
Agreement and has not been resolved under the Negotiation procedures described
herein, either Party may require, by written notice to the other Party, that
Negotiation be facilitated by a single mediator, to be selected by the Parties
(the "Mediator").

            The Parties shall select the Mediator within ten (10) days after
receipt of notice. If the Parties are unable to agree on the Mediator, the
Mediator shall be selected by Atlas, but the selected Mediator shall be
independent of Atlas and its affiliates. The fees of the Mediator shall be
divided equally between the Parties.

            With the assistance of the Mediator, the Parties shall continue
Negotiation in good faith for a period not to exceed thirty (30) days. If the
Parties are unable to reach agreement

                                     - 9 -



during this period, the Mediator shall be discharged and the Parties'
obligations under this Mediation section shall be deemed satisfied.

            5.3   ARBITRATION. Subject to the duty to negotiate and mediate set
forth above, all disputes, claims, or causes of action arising out of or
relating to this Agreement or the validity, interpretation, breach, violation,
or termination thereof not resolved by Mediation, shall be finally and solely
determined and settled by arbitration, to be conducted in the State of New York,
USA, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association ("AAA") in effect at the date of arbitration
("Arbitration"). This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without reference to principles of
conflict of laws.

            Any Arbitration commenced pursuant to this Agreement shall be
conducted by a single neutral arbitrator, who shall have a minimum of three (3)
years of commercial experience (the "Arbitrator"). The Parties shall meet within
ten (10) days of failure to resolve by Mediation to attempt to agree on an
Arbitrator. Absent agreement at this meeting, the Arbitrator shall be selected
by AAA. Such Arbitrator shall be free of any conflicts with Atlas and shall hold
a hearing within thirty (30) days of the notice to Employee.

            If the terms and conditions of this Agreement are inconsistent with
the Commercial Arbitration Rules of the AAA, the terms and conditions of this
Agreement shall control.

            The Parties hereby consent to any process, notice, or other
application to said courts and any document in connection with Arbitration may
be served by (i) certified mail, return receipt requested; (ii) by personal
service; or (iii) in such other manner as may be permissible under the rules of
the applicable court or Arbitration tribunal; PROVIDED, HOWEVER, a

                                     - 10 -



treasonable time for appearance is allowed. The Parties further agree that
Arbitration proceedings must be instituted within one (1) year after the
occurrence of any dispute, and failure to institute Arbitration proceedings
within such time period shall constitute an absolute bar to the institution of
any proceedings and a waiver of all claims.

            The Parties shall equally divide all costs and expenses incurred in
such proceeding and related legal proceedings unless determined otherwise by the
arbitrator.

            The Judgment of the Arbitrator shall be final and either Party may
submit such decision to courts for enforcement thereof.

6.    SEVERABILITY AND ENFORCEABILITY

            It is expressly acknowledged and agreed that the covenants and
provisions hereof are separable; that the enforceability of one covenant or
provision shall in no event affect the full enforceability of any other covenant
or provision herein. Further, it is agreed that, in the event any covenant or
provision of this Agreement is found by any court of competent jurisdiction or
Arbitrator to be unenforceable, illegal or invalid, such invalidity, illegality
or unenforceability shall not affect the validity or enforceability of any other
covenant or provision of this Agreement. In the event a court of competent
jurisdiction or an Arbitrator would otherwise hold any part hereof unenforceable
by reason of its geographic or business scope or duration, said part shall be
construed as if its geographic or business scope or duration had been more
narrowly drafted so as not to be invalid or unenforceable.

7.    MISCELLANEOUS

            7.1   NO MITIGATION. The amounts to be paid to Employee are net to
Employee, without any reduction or duty to mitigate, except for taxes, other
governmental charges or

                                     - 11 -



amounts owed to Atlas by Employee, and all payments to be made hereunder shall
be net of all applicable income and employment taxes required to be withheld
therefrom.

            7.2   PRO-RATION. In the event the Employment Period is terminated
in the middle of any calendar month, the amount due for such month shall be
pro-rated on a daily basis.

            7.3   NO WAIVER EXCEPT IN WRITING. No waiver or modification of a
this Agreement or any of the terms and conditions set forth herein shall be
effective unless submitted to a writing duly executed by the parties.

            7.4   SUCCESSORS AND ASSIGNS. This Agreement shall be binding on
Atlas and any successor thereto, whether by reason of merger, consolidation or
otherwise. The duties and obligations of Employee may not be assigned by
Employee.

            7.5   CONFIDENTIALITY OF TERMS. Atlas and Employee agree that the
terms and conditions of this Agreement are confidential and that they will not
disclose the terms of this Agreement to any third parties, other than the
Employee's spouse, their attorneys, auditors, accountants or as required by law
or as may be necessary to enforce this Agreement.

            7.6   FULL UNDERSTANDING. Employee declares and represents that
Employee has carefully read and fully understands the terms of this Agreement,
has had the opportunity to obtain advice and assistance of counsel with respect
thereto, and knowingly and of Employee's own free will, without any duress,
being fully informed and after due deliberation, voluntarily accepts the terms
of this Agreement and represents that the execution, delivery and performance of
this Agreement does not violate any agreement to which Employee is subject.

            7.7   ENTIRE AGREEMENT. This Agreement sets forth the entire
agreement and understanding between the parties with respect to the subject
matter hereof and supersedes all

                                     - 12 -



prior agreements, arrangements, and understandings between the parties with
respect to the subject matter hereof.

            IN WITNESS WHEREOF, the parties hereto have executed this agreement
on the date and year first above written.

WAKELEE SMITH                                 ATLAS AIR WORLDWIDE HOLDINGS, INC.



- -------------------------------               ----------------------------------

                                     - 13 -



                      AMENDMENT TO EMPLOYMENT AGREEMENT OF
                                  WAKELEE SMITH


            WHEREAS, by this Amendment dated as of January 29, 2004 (the
"Amendment") ATLAS AIR WORLDWIDE HOLDINGS, INC. ("ATLAS") and Wakelee Smith
("Employee") wish to update, amend and modify provisions of the Employment
Agreement between them dated February 1, 2003, (hereafter referred to as the
"AGREEMENT") as set forth herein.

            Now, therefore, for good and valuable consideration, the receipt of
which is hereby acknowledged, the terms and conditions of the above-referenced
AGREEMENT are updated, amended and modified as follows:

1.0         Effective February 1, 2004, Employee's job title as set forth in
            Article 2.1 of the Agreement shall be changed to Senior Vice
            President, Corporate Planning and Development

2.0         Section 3 of the Agreement is amended by striking "ATLAS" in line 1
            and replacing it with "Atlas Air, Inc., a wholly-owned subsidiary of
            ATLAS".

3.0         Section 3.1 is amended by striking "ATLAS" in line 1 and replacing
            it with "Atlas Air, Inc., a wholly-owned subsidiary of ATLAS". In
            addition, effective February 1, 2004, Employee's Base Annual Salary
            shall be increased to $260,000 per annum. Effective June 30, 2004,
            Employee's Base Annual Salary shall be increased to $280,000.00 per
            annum, it being understood that the second installment of Key
            Employee Retention Program which is payable on or about July 1,
            2004, shall be paid Employee based on a $280,000 Base Annual Salary.

                                     - 14 -



            With the exception of the amendments and modifications reflected in
Paragraphs 1.0 through 3.0 of this AMENDMENT, the AGREEMENT otherwise remains in
full force and effect.

AGREED TO AND ACCEPTED BY:

EMPLOYEE



- ----------------------------------           ---------------------
WAKELEE SMITH                                Date



ATLAS AIR WORLDWIDE HOLDINGS, INC.



By:
- ----------------------------------           ---------------------
Name:                                        Date


                                     - 15 -



                   AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT OF
                                  WAKELEE SMITH



            WHEREAS, by this Amendment No. 2 dated as of June 15, 2004 (the
"Amendment No. 2") ATLAS AIR WORLDWIDE HOLDINGS, INC. ("ATLAS") and Wakelee
Smith ("Employee") wish to update, amend and modify provisions of the Employment
Agreement between them dated February 1, 2003, (hereafter referred to as the
"AGREEMENT") as set forth herein.

            Now, therefore, for good and valuable consideration, the receipt of
which is hereby acknowledged, the terms and conditions of the above-referenced
AGREEMENT are updated, amended and modified as follows:

1.0         Effective June 16, 2004, Employee's job title as set forth in
            Article 2.1 of the Agreement shall be changed to Senior Vice
            President & Chief Operating Officer.

2.0         Effective June 16, 2004, Employee's Base Annual Salary shall be
            increased to $300,000 per annum, it being understood that the second
            installment of Key Employee Retention Program which is payable on or
            about August 29, 2004, shall be paid Employee based on Employee's
            $300,000 Base Annual Salary.

3.0         The Agreement is amended to add Article 4.1.1 as follows:

            "4.1.1 Notwithstanding Article 1.5(i) and (ii), 4.2(a), or any other
            provision to the contrary, if the Company relocates its corporate
            headquarters from Purchase, New York, and Employee elects not to
            relocate his principal residence to the new location, the

                                     - 16 -



            Company may (i) restore Employee to his previous title or other
            Senior Vice President position in the Company's discretion, and
            Employee's compensation package (including Base Annual Salary, bonus
            and benefits) shall be set at the level as of June 16, 2004, it
            being understood that (A) Employee shall be required to spend a
            reasonable amount of office time at the Company's new location as
            requested by the CEO, and (B) any such change in title or
            compensation shall not be deemed to constitute Good Reason, or (ii)
            terminate Employee's employment and the Employment Agreement without
            further payment or recourse, and, subject to Employee executing a
            release satisfactory to the Company, the Company will pay Employee
            nine (9) months salary as severance.

            With the exception of the amendments and modifications reflected in
Paragraphs 1.0 through 3.0 of this AMENDMENT, the AGREEMENT otherwise remains in
full force and effect.

AGREED TO AND ACCEPTED BY:

EMPLOYEE


/s/ Wakelee Smith                            6/21/04
- ----------------------------------           ---------------------
WAKELEE SMITH                                Date



ATLAS AIR WORLDWIDE HOLDINGS, INC.



By: /s/ John Dietrich                        6/21/04
- ----------------------------------           ---------------------
Name: John Dietrich                          Date
        SVP

                                     - 17 -

EX-10.18.1

                                                                      EX-10.18.1

                              EMPLOYMENT AGREEMENT

            This Employment Agreement (hereinafter referred to as the
"Agreement") is made and entered into as of the 1st day of May, 2003 by and
between Ronald A. Lane (hereinafter referred to as "Employee") and Atlas Air
Worldwide Holdings, Inc., a, Delaware corporation (hereinafter referred to as
"Atlas" or the "Company").

            WHEREAS, Atlas believes that it is in the best interests of Atlas to
retain the services of the Employee and the Employee desires an affiliation with
Atlas, on the terms and subject to the conditions set forth in this Agreement;
and

            WHEREAS, Employee warrants that Employee is entering voluntarily
into this Agreement, and that no promises or inducements for this Agreement have
been made outside of the terms and conditions referred to herein, and Employee
enters into this Agreement without reliance upon any statement or representation
by Atlas or any other person, concerning any fact material hereto.

            NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and other good and valuable considera-





                                       -2-

tion, the receipt and sufficiency of which is hereby acknowledged, the parties
hereto, intending to be legally bound hereby, covenant and agree as follows:

 1.   DEFINITIONS

            1.1 For purposes of this Agreement, "CAUSE" as used herein means (i)
any act or acts of material dishonesty taken by the Employee, (ii) the failure
of the Employee to comply with any of the Employee's obligations within ten (10)
days of written notice from Atlas, (iii) any violation by Employee Of Atlas
corporate policies as set forth in the Employee Compliance Manual, Employee
Handbook or related corporate policies of which Employee has received written
notice; provided that, if such violation is subject to cure, Employee shall have
ten (10) days within which to cure such violation after receipt of written
notice thereof, or (iv) the conviction of or "no contest" plea by the Employee
to any misdemeanor of moral turpitude or, any felony.

            1.2 "EMPLOYMENT PERIOD" shall be defined as the period commencing on
the date hereof and extending until may 1, 2008, subject to earlier termination
as set forth in Section 4 below and extension as provided in the next succeeding
sen-





                                       -3-

tence. On May 1, 2008 and on each anniversary thereafter, the Employment Period
shall be automatically extended for an additional one year unless Atlas gives
notice in writing to the employee or the Employee gives notice in writing to
Atlas at least three months prior to May 1, 2008 or such anniversary, as the
case may be, that the Employment Period is not to be so extended.

            1.3 "PERMANENT DISABILITY" as used herein shall be deemed to have
been sustained by Employee if Employee shall have been continuously disabled
from performing the duties assigned to Employee during the Employment Period for
a period of six (6) consecutive calendar months, and such Permanent Disability
shall be deemed to have commenced on the day following the end of such six (6)
consecutive calendar months.

            1.4 "CONFIDENTIAL OR PROPRIETARY" as used herein shall refer to all
information relative to the plans, structure and practices, including
information relating to its customers, contracts and aircraft of Holdings (as
defined below) or any affiliate or subsidiary thereof, except:

            (a) information that is or becomes a matter of public knowledge
through no fault of the Employee; or

            (b) information rightfully received by the Employee from a third
party without a duty of confidentiality; or





                                       -4-

            (c) information disclosed to Employee with Atlas' prior approval for
public dissemination.

            1.5 "GOOD REASON" as used herein means (i) a reduction during the
term of this Agreement in either the Employee's Base Annual Salary, as adjusted
from time to time, or (ii) a substantial and material reduction in the
Employee's title or job responsibilities from the Employee's title or job
responsibilities at the commencement of this Agreement, (iii) any reduction,
within twelve (12) months following a Change of Control, in the Employee's title
or job responsibilities from the Employee's title or job responsibilities at the
commencement of this Agreement, and (iv) a requirement by Atlas that Employee
relocate his principal residence from the Long Beach, California area. For
purposes of this Section 1.5, "Change of Control" shall mean the acquisition by
any person, entity or "group" within the meaning of section 1.3(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange Act") (excluding,
for this purpose, (x) the Estate of Michael Chowdry, Chowdry Limited
Partnership, Chowdry, Inc., the Chowdry Foundation and Linda H. Chowdry and her
family members and (y) any employee benefit plan of Atlas, Holdings or its
affiliates) of beneficial ownership, within the meaning of Rule 13(d)(c)
promulgated under the Exchange Act, of greater than fifty percent




                                      -5-

(50%) of the combined voting power of the outstanding voting securities of
Holdings entitled to vote generally in the election of directors.

 2.   EMPLOYMENT AND OBLIGATIONS OF EMPLOYES

            Atlas and Employee agree to the following rights, obligations and
duties with respect to employment:

            2.1 EMPLOYMENT. During the Employment Period, Atlas agrees to employ
the Employee as its Senior Vice President and Chief Marketing Officer. The scope
of Employee's responsibilities shall be as determined by the Board of Directors
and/or appropriate officers of Atlas. If the Board of Directors of Atlas
requests Employee to serve in any capacity for Atlas or any of its respective
subsidiaries or affiliates, Employee agrees that Employee shall serve such
capacity, without any additional compensation.

            2.2 OBLIGATIONS OF EMPLOYEE. During the Employment Period, the
Employee agrees, except when prevented by illness or Permanent Disability or
during a period of vacation, to devote substantially all of Employee's business
time and attention to the good faith performance of the duties contemplated.





                                       -6-

            2.3 PRINCIPAL RESIDENCE OF EMPLOYEE. During the Employment Period,
Employee shall maintain Employee's principal residence in the Long Beach,
California, area unless otherwise agreed. In the event the parties agree on a
relocation, the Company shall reimburse Employee for reasonable moving expenses
to be determined and paid by Atlas.

 3.   COMPENSATION

            During the Employment Period, Atlas will pay Employee as follows:

            3.1 BASE ANNUAL SALARY. Atlas will pay Employee a base annual salary
(the "Base Annual Salary") of USD $200,000.00 per annum, payable in semi-monthly
installments. The Company shall review Base Salary not less frequently than
every six months for the first two years of the Agreement, it being understood
that Employee's Base Annual Salary shall be increased at least USD $12,500.00 as
of each of the aforementioned review periods such that Employee's Base Annual
Salary shall be no less than USD $350,000.00 as of May 1, 2005; any reviews and
increases greater than the aforementioned amounts or thereafter shall be at the
sole discretion of the Company.




                                       -7-

            3.2 INCENTIVE BONUS PAYMENTS. Employee will receive a sign on bonus
of $215,000.00 within 21 days of the date of this Agreement. In addition,
Employee will be eligible to receive an annual incentive bonus under the annual
Executive Incentive Program ("EIP") at a target of 50% of Base Salary (or, if a
greater percentage, such percentage offered to similarly situated executives of
the Company) based on performance, including financial and individual
performance for each calendar year (prorated for 2003 as provided below) during
the Employment Period. For 2003, Employee will receive $50,000 within 15 days of
this Agreement for the period of January through April 2003 (in recognition of
support to Atlas during this period). In addition, for 2003, Employee shall be
guaranteed an EIP bonus of not less than full target (i.e. 50% of Base Salary)
prorated accordingly for the period of less than full year (i.e. May through
December 2003). For 2004, Employee shall be guaranteed an EIP bonus of not less
than 75% of the targeted amount. For 2005, Employee shall be guaranteed an EIP
bonus of not less than 50% of the targeted amount. For 2006, employee shall be
guaranteed an EIP bonus of not less than 25% of the targeted amount. There shall
be no guarantee of EIP bonus for years after 2006. Employee will also be able,
subject to eligibility requirements as set forth in each respective






                                       -8-

program, to participate in the Company's Long Term Incentive Program, Deferred
Compensation Plan, Annual Stock Option Plan, Employee Stock Purchase Plan,
Profit Sharing and 401(k) Plan, details of which have already been provided to
Employee.

            3.3 BENEFITS. Employee and Employee's dependents shall be entitled
to participate in the Atlas health insurance plan, and Atlas will contribute to
Employee's monthly premium as provided by such plan. Atlas reserves the right to
discontinue participation in any health insurance plan at any time with the
understanding that Atlas will comply in full measure with all state and federal
laws regarding the changes of insurance coverage by private employers and
notification under the Consolidated Omnibus Budget Reconciliation Act. Employee
also shall be entitled, to the same extent and at a level commensurate with the
corporate officers of Atlas, to participate in any other benefit plans or
arrangements of Atlas.

            3.4 FRINGE BENEFITS. Employee will be entitled to a car allowance in
the amount of $700.00 per month.

            4. TERMINATION OF EMPLOYMENT PERIOD

            The Employment Period shall terminate under the following terms and
conditions:




                                       -9-

            4.1 AT WILL ARRANGEMENT. Atlas may terminate the Employment Period
upon written notice to the Employee at any time and for any reason. Atlas and
Employee expressly understand and agree that the employment relationship is
at-will. Atlas is entitled to sever the employment relationship for any reason.
Employee hereby agrees to give Atlas at least thirty (30) days prior written
notice of Employee's voluntary termination of employment for other than Good
Reason.

            4.2 RIGHTS FOLLOWING TERMINATION.

            (a) If the Employment Period is terminated by Atlas for reasons
other than Cause (including the giving of notice by Atlas pursuant to Section
1.2 hereof of Atlas' election not to extend the Employment Period) or if the
Employment Period is terminated by the Employee for Good Reason, and subject to
Employee's execution of a release upon terms and conditions acceptable to Atlas,
the Employee shall be entitled to: (i) receive 18 months of Employee's monthly
salary paid in a lump sum within ten (10) days of Employee's execution of the
aforementioned release; and (ii) continued coverage and rights and benefits
available under the employee benefit programs of Atlas as provided in Section
3.3 above for a period of 12 months from the date of termination subject to the
Employee paying the same




                                      -10-

portion for the premiums for such coverage as he paid during his employment with
the Company; PROVIDED, HOWEVER, that any such continued coverage shall cease in
the event Employee obtains comparable coverage in connection with subsequent
employment, and to the extent Atlas is unable to continue such coverage, Atlas
shall provide the Employee with economically equivalent benefits determined on
an after-tax basis.

            (b) Upon the death or Permanent Disability of the Employee, the
Employment Period shall terminate and the Employee's Base Annual Salary which is
accrued for the current pay period but unpaid as of the date of such death or
Permanent Disability shall be paid to the Employee or Employee's personal
representative. In addition, upon the death or Permanent Disability of the
Employee, Employee or Employee's personal representative shall be entitled to
the compensation and benefits as set forth in Section 4.2 (a)(i) and (ii) above.

            (c) If the Employment Period is terminated by Atlas for Cause or by
the Employee for other than Good Reason (including the giving of notice by
Employee pursuant to Section 1.2 hereof of Employee's election not to extend the
Employment Period), the Employee shall be entitled to receive Em-




                                      -11-

ployee's Base Annual Salary which is accrued for the current pay period but
unpaid as of the date of termination.

            4.3 NON-COMPETITION PROVISION. (a) Employee covenants and agrees
that Employee will not, at any time, reveal, divulge or make known to any third
party any confidential or proprietary records, data, trade secrets, pricing
policies, strategy, rate structure, personnel policy, management methods,
financial reports, methods or practice of obtaining or doing business, or any
other confidential or proprietary information of Atlas or any of its
subsidiaries or affiliates (collectively the "Atlas Companies" and each, an
"Atlas Company") which is not in the public domain.

            (b) In addition, in the event the Employment Period is terminated by
the Company for Cause or by Employee for Good Reason (or if the termination of
the Employment Period is by the Company for other than Cause or by Employee for
other than Good Reason but the Company offers Employee the benefits set forth in
Article 4.2(a) above), Employee covenants and agrees that, at no time before
twelve (12) months after Employee's termination of employment with Atlas, will
Employee engage in any of the following activities directly or indirectly, for
any




                                      -12-

reason, whether for Employee's own account or for the account of any other
person, firm, corporation or other organization:

            (i)   solicit, employ or otherwise interfere with any of the Atlas
                  Companies' contracts or relationships with any current
                  employee or individual who has been employed by the Atlas
                  Companies within six (6) months of Employee's termination of
                  employment, officer, director or any independent contractor
                  whether the person is employed by or associated with an Atlas
                  Company on the date of this Agreement or at any time
                  thereafter; or

            (ii)  solicit or otherwise interfere with any of the Atlas
                  Companies' contracts or relationships with any customer or
                  client.

            (iii) accept employment with, or give advice to any direct
                  competitor of Atlas or any of its subsidiary or affiliated
                  companies, including but not limited to air cargo carriers,
                  air cargo divisions or cargo affiliates of other airlines, or
                  companies that lease cargo aircraft or sell




                                      -13-

                  cargo aircraft capacity as a significant part of their
                  business on an ACMI, block space, wet lease or charter basis.

5.    DISPUTE RESOLUTION AND CHOICE OF LAW

            5.1. NEGOTIATION. If a dispute between the Parties arises under this
Agreement, the Parties shall negotiate in good faith in an attempt to resolve
their differences. The obligation of the Parties to negotiate in good faith
shall commence immediately, and shall continue for a period of at least thirty
(30) days ("Negotiation").

            If Negotiation fails to resolve a dispute between the Parties within
the first thirty (30) days, either Party may proceed to demand mediation
("Mediation"). Upon agreement of both Parties, arbitration may be initiated
immediately, in lieu of Mediation.

            5.2. MEDIATION. If a dispute between the Parties arises under this
Agreement and has not been resolved under the Negotiation procedures described
herein, either Party may require, by written notice to the other Party, that
Negotiation




                                      -14-

be facilitated by a single mediator, to be selected by the Parties (the
"Mediator").

            The parties shall select the Mediator within ten (10) days after
receipt of notice. If the Parties are unable to agree on the Mediator, the
Mediator shall be selected by Atlas, but the selected Mediator shall be
independent of Atlas and its affiliates. The fees of the Mediator shall be paid
by the Company.

            With the assistance of the Mediator, the Parties shall continue
Negotiation in good faith for a period not to exceed thirty (30) days. If the
Parties are unable to reach agreement during this period, the Mediator shall be
discharged and the Parties' obligations under this Mediation section shall be
deemed satisfied.

            5.3. ARBITRATION. Subject to the duty to negotiate and mediate set
forth above, all disputes, claims, or causes of action arising out of or
relating to this Agreement or the validity, interpretation, breach, violation,
or termination thereof not resolved by Mediation, shall be finally and solely
determined and settled by arbitration, to be conducted in the State of New York,
USA, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association ("AAA")




                                      -15-

in effect at the date of arbitration ("Arbitration"). This Agreement shall be
governed by and construed in accordance with the laws of the state of New York,
without reference to principles of conflict of laws.

            Any Arbitration commenced pursuant to this Agreement shall be
conducted by a single neutral arbitrator, who shall have a minimum of three (3)
years of commercial experience (the "Arbitrator"). The Parties shall meet within
ten (10) days of failure to resolve by Mediation to attempt to agree on an
Arbitrator. Absent agreement at this meeting, the Arbitrator shall be selected
by AAA. Such Arbitrator shall be free of any conflicts with Atlas and shall hold
a hearing within thirty (30) days of the notice to Employee.

            If the terms and conditions of this Agreement are inconsistent with
the Commercial Arbitration Rules of the AAA, the terms and conditions of this
Agreement shall control.

            The Parties hereby consent to any process, notice, or other
application to said courts and any document in connection with Arbitration may
be served by (i) certified mail, return receipt requested; (ii) by personal
service; or (iii) in such other manner as may be permissible under the rules of
the applicable court or Arbitration tribunal; PROVIDED, HOWEVER, a




                                      -16-

reasonable time for appearance is allowed. The Parties further agree that
Arbitration proceedings must be instituted within one (1) year after the
occurrence of any dispute, and failure to institute Arbitration proceedings
within such time period shall constitute an absolute bar to the institution of
any proceedings and a waiver of all claims.

            The Parties shall equally divide all costs and expenses incurred in
such arbitration proceeding, provided, however, if the arbitrator rules in favor
of the Employee on all or substantially all of his claims, the Company shall
reimburse Employee his reasonable attorney fees for the arbitration proceedings.

            The Judgment of the Arbitrator shall be final and either Party may
submit such decision to courts for enforcement thereof.

6.    SEVERABILITY AND ENFORCEABILITY

            It is expressly acknowledged and agreed that the covenants and
provisions hereof are separable; that the enforceability of one covenant or
provision shall in no event affect the full enforceability of any other covenant
or provision




                                      -17-

herein. Further, it is agreed that, in the event any covenant or provision of
this Agreement is found by any court of competent jurisdiction or Arbitrator to
be unenforceable, illegal or invalid, such invalidity, illegality or
unenforceability shall not affect the validity or enforceability of any other
covenant or provision of this Agreement. In the event a court of competent
jurisdiction or an Arbitrator would otherwise hold any part hereof unenforceable
by reason of its geographic or business scope or duration, said part shall be
construed as if its geographic or business scope or duration had been more
narrowly drafted so as not to be invalid or unenforceable.

 7.   MISCELLANEOUS

            7.1 NO MITIGATION. The amounts to be paid to Employee are net to
Employee, without any reduction or duty to mitigate, except for taxes, other
governmental charges or amounts owed to Atlas by Employee, and all payments to
be made hereunder shall be net of all applicable income and employment taxes
required to be withheld therefrom.

            7.2 Pro-Ration In the event the Employment Period is terminated in
the middle of any calendar month, the amount due for such month shall be
pro-rated on a daily basis.




                                      -18-

            7.3 NO WAIVER EXCEPT IN WRITING. No waiver or modification of this
Agreement or any of the terms and conditions set forth herein shall be effective
unless submitted to a writing duly executed by the parties.

            7.4 SUCCESSORS AND ASSIGNS. This Agreement shall be binding on Atlas
and any successor thereto, whether by reason of merger, consolidation or
otherwise. The duties and obligations of Employee may not be assigned by
Employee.

            7.5 CONFIDENTIALITY OF TERMS. Atlas and Employee agree that the
terms and conditions of this Agreement are confidential and that they will not
disclose the terms of this Agreement to any third parties, other than the
Employee's spouse, their attorneys, auditors, accountants or as required by law
or as may be necessary to enforce this Agreement.

            7.6 FULL UNDERSTANDING. Employee declares and represents that
Employee has carefully read and fully understands the terms of this Agreement,
has had the opportunity to obtain advice and assistance of counsel with respect
thereto, and knowingly and of Employee's own free will, without any duress,
being fully informed and after due deliberation, voluntarily accepts the terms
of this Agreement and represents that




                                      -19-

the execution, delivery and performance of this Agreement does not violate any
agreement to which Employee is subject.

            7.7 ENTIRE AGREEMENT. This Agreement sets forth the entire agreement
and understanding between the parties with respect to the subject matter hereof
and supersedes all prior agreements, arrangements, and understandings between
the parties with respect to the subject matter hereof.

            IN WITNESS WHEREOF, the parties hereto have executed this agreement
on the date and year first above written.



Ronald A. Lane                               Atlas Worldwide Holdings, Inc.

/s/ Ronald A. Lane                           /s/ Atlas Worldwide Holdings, Inc.
- ------------------                           ----------------------------------



                      AMMENDMENT TO EMPLOYMENT AGREEMENT OF
                                 RONALD A. LANE

            Whereas, Atlas Air Worldwide Holdings, Inc. ("ATLAS") and Ronald A.
Lane ("EMPLOYEE") wish to update, amend or modify provisions of the Employment
Agreement dated May 1, 2003 between them (the "AGREEMENT") as set forth in this
amendment ("AMENDMENT").

            The terms and conditions of the above-referenced Agreement is hereby
updated, amended and modified as follows:

1.0         Section 3 is amended by striking "ATLAS" in line 1 and replacing it
            with "Atlas Air, Inc., a wholly-owned subsidiary of ATLAS".

2.0         Section 3.1 is amended by striking "ATLAS" in line 1 and replacing
            it with "Atlas Air, Inc., a wholly-owned subsidiary of ATLAS".

            With the exception of the amendments and modifications reflected in
Paragraphs 1.0 and 2.0 of this Amendment,





                                       -2-

THE AGREEMENT otherwise remains in full force and effect.

AGREED TO AND ACCEPTED BY:

EMPLOYEE

/s/ Ronald A. Lane                                 1/24/04
- ----------------------                        ----------------
Ronald A. Lane                                 Date



ATLAS AIR WORLDWIDE HOLDINGS, INC.

BY:  /s/ John Dietrich                              1/24/04
- ----------------------                        ----------------
Name: John Dietrich                            Date





                     AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT OF
                                 RONALD A. LANE

      WHEREAS, Atlas Air Worldwide Holdings, Inc. ("Atlas") and Ronald A. Lane
("Employee") wish to update, amend or modify the provisions of the Employment
Agreement dated as of May 1, 2003 between them (the "Agreement") as set forth in
this amendment (the "Amendment").

      The terms and conditions of the Agreement are hereby updated, amended and
modified as follows:

      Paragraph 3.2 is amended so that, after amendment, it shall read in its
entirety as follows:

      "3.2 INCENTIVE BONUS PAYMENTS. Employee will receive a sign on bonus of
$215,000 within 21 days of the date of this Agreement. In addition, Employee
will be eligible to receive an annual incentive bonus under the annual Executive
Incentive Program ("EIP") at a target Of 50% of Base Salary (or, if a geater
percentage, such percentage offered to similarly situated executives of the
Company) based on performance, including financial and individual performance
for each calendar year during the Employment period. For 2003, Employee will
receive an EIP bonus of $50,000 within 15 days of this Agreement. For fiscal
years beginning after 2004 (i.e., 2005 and beyond) the Employee shall have the
right to terminate the Employment Period if he fails to receive at least his
target EIP bonus for a period of two consecutive fiscal years, provided Employee
must notify the Company of his election to terminate hereunder by June 30th of
the year following the expiration of the second consecutive fiscal year where no
EIP bonus was paid. Under such circumstances, Employee shall be entitled to
receive 12 months of the Employee's monthly salary paid in a lump sum




within thirty (30) days of Employee's execution of a release upon terms and
conditions acceptable to Atlas and Employee shall be entitled to continued
coverage and rights and benefits available under the employee benefit programs
of Atlas as provided in Section 3.3 above for a period of 12 months from the
date of termination subject to the Employee paying the same portion for the
premiums for such coverage as he paid during his employment with the Company;
PROVIDED, HOWEVER, that any such continued coverage shall cease in the event
Employee obtains comparable coverage in connection with subsequent employment,
and to the extent Atlas is unable to continue such coverage, Atlas shall provide
the Employee with economically equivalent benefits determined on an after-tax
basis. Employee shall also be able, subject to eligibility requirements as set
forth in each respective program, to participate in the Company's Long Term
Incentive Program, Profit Sharing, 401(k) Plan, and any details of which have
already been or will be provided to Employee."

      With the exception of the amendments and modifications reflected in
Paragraph 3.2 of this Amendment, the Agreement, as previously amended, otherwise
remains in full force and effect.

AGREED TO AND ACCEPTED BY:

/s/  Ronald A. Lane                                      20 April 2004
- -------------------------                              -----------------
Ronald A. Lane                                         Date

ATLAS AIR WORLDWIDE
HOLDINGS, INC.


/s/ John Dietrich                                        20 April 2004
- -------------------------                              -----------------
Name:                                                  Date
Title:

EX-10.19.1

                                                                      EX-10.19.1

                              AMENDED AND RESTATED

                              EMPLOYMENT AGREEMENT

            This Amended and Restated Employment Agreement (hereinafter referred
to as the "Agreement") is made and entered into as of the 1st day of April, 2005
by and between John W. Dietrich (hereinafter referred to as "Employee") and
Atlas Air, Inc., a Delaware corporation (hereinafter referred to as "Atlas").
This Agreement amends and restates in its entirety that certain Employment
Agreement between the parties dated as of March 19, 2003, as amended to date.

            WHEREAS, Atlas believes that it is in the best interests of Atlas to
retain the services of the Employee and the Employee desires an affiliation with
Atlas, on the terms and subject to the conditions set forth in this Agreement;
and

            WHEREAS, Employee warrants that Employee is entering voluntarily
into this Agreement, and that no promises or inducements for this Agreement have
been made outside of the terms and conditions referred to herein, and Employee
enters into this Agreement without reliance upon any statement or representation
by Atlas or any other person, concerning any fact material hereto.

            NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto, intending to be legally
bound hereby, covenant and agree as follows:

1.    DEFINITIONS

            1.1   For purposes of this Agreement, "CAUSE" as used herein means
(i) any act or acts of material dishonesty taken by the Employee, (ii) the
failure of the Employee to comply with any of the Employee's material
obligations within ten (10) days of written notice from


                                        1



Atlas, (iii) any material violations by Employee of Atlas corporate policies as
set forth in the Employee Compliance Manual, Employee Handbook or related
corporate policies; provided that, if such violation is subject to cure,
Employee shal1 have ten (10) days within which to cure such- violation, or (iv)
the conviction of or "no contest" plea by the Employee to any misdemeanor of
moral turpitude or any felony.

            1.2   "EMPLOYMENT PERIOD" shall be defined as the period commencing
on the date hereof and extending until this Agreement is terminated by either
party in accordance with Section 4.

            1.3   "PERMANENT DISABILITY" as used herein shall be deemed to have
been sustained by Employee if Employee shall have been continuously disabled
from performing the duties assigned to Employee during the Employment Period for
a period of six (6) consecutive calendar months, and such Permanent Disability
shall be deemed to have commenced on the day following the end of such six (6)
consecutive calendar months.

            1.4   "CONFIDENTIAL OR PROPRIETARY" as used herein shall refer to
all information relative to the plans, structure and practices, including
information relating to its customers, contracts and aircraft of Atlas, Atlas
Worldwide Holdings, Inc. ("Holdings") or any affiliate or subsidiary thereof,
except:

            (a)   information that is or becomes a matter of public knowledge
through no fault of the Employee; or

            (b)   information rightfully received by the Employee from a third
party without a duty of confidentiality; or

            (c)   information disclosed to Employee with Atlas' prior written
approval for public dissemination.

                                       2



            1.5   "GOOD REASON" as used herein means either of (i) a reduction
during the term of this Agreement in the Employee's Base Annual Salary or
eligibility to receive a bonus, and (ii) a reduction in the Employee's then
current title or job responsibilities.

2.    EMPLOYMENT AND OBLIGATIONS OF EMPLOYEE

            Atlas and Employee agree to the following rights, obligations and
duties with respect to employment:

            2.1   EMPLOYMENT. During the Employment Period, Atlas agrees to
employ the Employee as Senior Vice President, General Counsel and Chief Human
Resources Officer of Atlas and of Holdings. The scope of Employee's
responsibilities shall be as determined by the Boards of Directors of Atlas
and/or Holdings, and/or appropriate officers of Atlas and/or Holdings. If the
Board of Directors of Holdings requests Employee to serve in any capacity for
Holdings, Employee agrees that Employee shall serve in such capacity, without
any additional compensation. In addition, Employee shall not be entitled to any
additional compensation for serving in any other office for Atlas, or Holdings
or any subsidiary or affiliate of Atlas or Holdings.

            2.2   OBLIGATIONS OF EMPLOYEE. During the Employment Period, the
Employee agrees, except when prevented by illness or Permanent Disability, or
during a period of vacation, to devote substantially all of Employee's business
time and attention to the good faith performance of the duties contemplated.

            2.3   PRINCIPAL RESIDENCE OF EMPLOYEE. During the Employment Period,
Employee shall maintain Employee's principal residence in the Purchase, New York
area.

3.    COMPENSATION

            During the Employment Period, Atlas will pay Employee as follows:

                                       3



            3.1   BASE ANNUAL SALARY. Atlas will pay Employee a base annual
salary (the "Base Annual Salary") of USD $292,000 per annum, payable in
semi-monthly installments. The parties acknowledge that $12,000 of the Base
Annual Salary is in partial consideration for the elimination of the automobile
allowance previously provided to Employee. The Company shall review Base Annual
Salary not less frequently than annually for increases, including among other
considerations, Employee's performance, it being understood that any increases
shall be at the discretion of the Company.

            3.2   INCENTIVE BONUS PAYMENTS. Employee will be eligible to
participate in Holdings' Annual Incentive Plan. The level of the bonus available
to Employee will be set forth in the Annual Incentive Plan and will be awarded
in consideration of individual and corporate performance based on performance
goals and objectives determined by the Holdings Compensation Committee. A fuller
description of how corporate and individual performance operate in tandem to
determine the calculation of bonuses will be described in the Annual Incentive
Plan. The Annual Incentive Plan document will be developed by the Holdings
Compensation Committee and is subject to amendment from time to time with
changes as adopted by the Compensation Committee or full Board of Directors of
Holdings. As further described in the Annual Incentive Plan, corporate and
individual performance in combination may permit the Employee to earn a target
bonus equal to 50% of Base Annual Salary. Lesser corporate or individual
performance may cause bonus payments to be in an amount less than 50% of Base
Annual Salary or result in no bonus being payable. Greater corporate and
individual performances may result in the bonus being more than 50% of Base
Annual Salary. When the bonus payment reaches more than 50% of Base Annual
Salary, Atlas reserves the right to pay some or all of the portion of the bonus
that is above 50% of Base

                                       4



Annual Salary in Holdings unrestricted company stock payable under the Atlas Air
Worldwide Holdings, Inc. 2004 Long Term Incentive and Share Award Plan. Any
bonus paid under the Annual Incentive Plan will be paid no later than two weeks
following the completion of the year-end audit for the applicable year.

            3.3   BENEFITS. Employee and Employee's dependents shall be entitled
to participate in the Atlas health insurance plan, provided that the Employee
and Atlas will each contribute to Employee's monthly premium as provided by such
plan. Atlas reserves the right to discontinue participation in any health
insurance plan at any time, provided that Atlas will reimburse Employee for
Employee's cost of obtaining comparable health care benefits for Employee and
his dependents. Employee also shall be entitled, to the same extent and at a
level commensurate with the corporate officers of Atlas, to participate in any
other benefit plans or arrangements of Atlas.

            3.4   FRINGE BENEFITS. (a) Employee will receive a one-time cash
payment of $19,000 in lieu of the tax gross-up related to the previously
provided automobile allowance.

            (b)   In consideration of the reduction of the severance payment
described in Section 4.2(a)(i) from the eighteen (18) months previously provided
to twelve (12) months, Employee will receive a one-time cash payment of
$119,000.

            (c)   The payments described in subsections (a) and (b) above shall
be payable within ten (10) days after the signing of this Agreement. Such
payments shall be subject to required tax withholding.


            (d)   The Employee will be entitled to four (4) weeks of paid
vacation per year.

                                       5



4.    TERMINATION OF EMPLOYMENT PERIOD

            The Employment Period shall terminate under the following terms and
conditions:

            4.1   AT WILL ARRANGEMENT. Atlas and Employee expressly understand
and agree that the employment relationship is at-will. Either party may
terminate the Employment Period and the employment relationship upon written
notice to the other at any time and for any reason. Employee will make every
reasonable effort to give Atlas at least three months prior, written notice of
Employee's voluntary termination of employment for other than Good Reason.

            4.2   RIGHTS FOLLOWING TERMINATION.

            (a)   If the Employment Period is terminated by Atlas for reasons
other than Cause or if the Employment Period is terminated by the Employee for
Good Reason, and subject to Employee's execution of a release upon terms and
conditions mutually acceptable to the Employee and Atlas, the Employee shall be
entitled to: (i) receive, in a single lump sum payment within 10 business days
after such termination, an amount equal to twelve (12) months of Employee's
monthly Base Salary; (ii) reimbursement of Employee's relocation expenses back
to the Chicago, Illinois area in accordance with the Company's relocation
policies and practices (including gross up for taxes); and (iii) continued
coverage and rights and benefits available under the employee benefit programs
of Atlas as provided in Section 3.3 above for a period of 12 months from the
date of termination; PROVIDED, HOWEVER, that any such continued coverage shall
cease in the event Employee obtains comparable coverage in connection with
subsequent employment, and to the extent Atlas is unable to continue such
coverage, Atlas shall provide the Employee with economically equivalent benefits
determined on an after-tax basis.

            (b)   Upon the death or Permanent Disability of the Employee, the
Employment Period shall terminate and the Employee's Base Annual Salary which is
accrued for the current pay period but unpaid as of the date of such death or
Permanent Disability shall be paid to the

                                       6



Employee or Employee's personal representative. In addition, upon the Permanent
Disability of the Employee, Employee shall be entitled to the compensation and
benefits set forth in Section 4.2 (a) (i), (ii) and (iii) above, and upon the
death of Employee, Employee's immediate family shall be entitled to the
compensation and benefits set forth in Section 4.2 (a) (i), (ii) and (iii)
above.

            (c)   If the Employment Period is terminated by Atlas for Cause or
by the Employee for other than Good Reason, the Employee shall be entitled to
receive Employee's Base Annual Salary which is accrued for the current pay
period but unpaid as of the date of termination.

            4.3   NON-COMPETITION PROVISION. (a) Employee covenants and agrees
that except when required to do so in the ordinary course of his duties,
Employee will not, at any time, reveal, divulge or make known to any third party
any confidential or proprietary records, data, trade secrets, pricing policies,
strategy, rate structure, personnel policy, management methods, financial
reports, methods or practice of obtaining or doing business, or any other
confidential, or proprietary information of Holdings, Atlas or any of their
subsidiaries or affiliates (collectively the "Atlas Companies" and each, an
"Atlas Company") which is not in the public domain.

            (b)   In addition, Employee covenants and agrees that, at no time
before the first anniversary of Employee's termination of employment with Atlas,
will Employee engage in any of the following activities directly or indirectly,
for any reason, whether for Employee's own account or for the account of any
other person, firm, corporation or other organization:

            (i)   solicit, employ or otherwise interfere with any of the Atlas
                  Companies contracts or relationships with any client,
                  employee, officer, director or any independent contractor
                  whether the person is employed by or

                                       7



associated with an Atlas Company on the date of this Agreement or at any time
thereafter; or

            (ii)  solicit, accept or otherwise interfere with any of the Atlas
                  Companies' contracts or relationships with any independent
                  contractor, customer, client or supplier, or any person who is
                  a bona fide prospective independent contractor, customer,
                  client or supplier of an Atlas Company.

            (c)   In addition, Employee covenants and agrees that, in the event
that immediately before his termination of employment with Atlas he is employed
in an exclusively non-attorney position which he has undertaken voluntarily, at
no time before the first anniversary of such termination of employment with
Atlas, will Employee directly or indirectly, for any reason, whether for
Employee's own account or for the account of any other person, firm, corporation
or other organization, accept employment in a non-attorney capacity with, or
give non-legal advice to, Evergreen International, Gemini Air Cargo, World
Airways, Air Atlanta, Kalitta Air or Southern Air. The parties agree and intend
that breach of this non-competition clause shall subject Employee to the full
measure of contract and equitable damages.

5.    DISPUTE RESOLUTION AND CHOICE OF LAW

            5.1   NEGOTIATION. If a dispute between the parties arises under
this Agreement, the parties shall negotiate in good faith in an attempt to
resolve their differences. The obligation of the parties to negotiate in good
faith shall commence immediately, and shall continue for a period of at least
thirty (30) days ("Negotiation").

            If Negotiation fails to resolve a dispute between the parties within
the first thirty (30) days, the parties may proceed to ("Mediation").

            5.2   MEDIATION. If a dispute between the parties arises under this
Agreement and has not been resolved under the Negotiation procedures described
herein, either party may

                                       8



request, by written notice to the other party, that Negotiation be facilitated
by a single mediator, to be selected by the parties (the "Mediator"). The other
party may, but is not required to, agree to such a process.

            If the parties agree to pursue Mediation, The Parties shall select
the Mediator within ten (10) days after receipt of notice. If the parties are
unable to agree on the Mediator, the Mediator shall be selected by Atlas, but
the selected Mediator shall be independent of Atlas and its affiliates. The fees
of the Mediator shall be divided equally between the parties.

            With the assistance of the Mediator, the Parties shall continue
Negotiation in good faith for a period not to exceed thirty (30) days. If the
parties are unable to reach agreement during this period, the Mediator shall be
discharged.

            5.3   ARBITRATION. All disputes, claims, or causes of action arising
out of or relating to this Agreement or the validity, interpretation, breach,
violation, or termination thereof not resolved by Mediation, may be determined
and settled by arbitration, to be conducted in the State of New York, USA, in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association ("AAA") in effect at the date of arbitration ("Arbitration"). This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without reference to principles of conflict of laws.

            Any Arbitration commenced pursuant to this Agreement ,shall be
conducted by a single neutral arbitrator, who shall have a minimum of three (3)
years of commercial experience (the "Arbitrator"). The Parties shall meet within
ten (10) days of failure to resolve by Mediation to attempt to agree on an
Arbitrator. Absent agreement at this meeting, the Arbitrator shall be selected
by AAA. Such Arbitrator shall be free of any conflicts with Atlas and shall hold
a hearing within thirty (30) days of the notice to Employee.

                                       9



            If the terms and conditions of this, Agreement are inconsistent with
the Commercial Arbitration Rules of the AAA, the terms and conditions of this
Agreement shall control.

            The Parties hereby consent to any process, notice, or other
application to said courts and any document in connection with Arbitration may
be served by (i) certified mail, return receipt requested; (ii) by personal
service; or (iii) in such other manner as may be permissible under the rules of
the applicable court or Arbitration tribunal; PROVIDED, HOWEVER, a reasonable
time for appearance is allowed. The Parties further agree that Arbitration
proceedings must be instituted within one (1) year after the occurrence of any
dispute, and failure to institute Arbitration proceedings within such time
period shall constitute an absolute bar to the institution of any proceedings
and a waiver of all claims. The Parties shall equally divide all costs and
expenses incurred in such proceeding and related legal proceedings; provided,
however, that Employee shall, if successful, be entitled to recover all his
costs and expenses including attorneys fees. The Judgment of the Arbitrator
shall be final and either Party may submit such decision to courts for
enforcement thereof.

6.    SEVERABILITY AND ENFORCEABILITY

            It is expressly acknowledged and agreed that the covenants and
provisions, hereof are separable; that the enforceability of one covenant or
provision shall in no event affect the full enforceability of any other covenant
or provision herein. Further, it is agreed that, in the event any covenant or
provision of this Agreement is found by any court of competent jurisdiction or
Arbitrator to be unenforceable, illegal or invalid, such invalidity, illegality
or unenforceability shall not affect the validity or enforceability of any other
covenant or provision of this Agreement. In the event a court of competent
jurisdiction or an Arbitrator would otherwise hold any part hereof unenforceable
by reason of its geographic or business scope or duration, said part

                                       10



shall be construed as if its geographic or business, scope or duration had been
more narrowly drafted so as not to be invalid or unenforceable.

7.    MISCELLANEOUS

            7.1   NO MITIGATION. The amounts to be paid to Employee are net to
Employee, without any reduction or duty to mitigate, except for taxes, other
governmental charges or amounts owed to Atlas by Employee, and all payments to
be made hereunder shall be net of all applicable income and employment taxes
required to be withheld therefrom.

            7.2   PRO-RATION. In the event the Employment Period is terminated
in the middle of any calendar month, the amount due for such month shall be
pro-rated on a daily basis.

            7.3   NO WAIVER EXCEPT IN WRITING. No waiver, or modification of
this Agreement or any of the terms and conditions set forth herein shall be
effective unless submitted to a writing duly executed by the parties.

            7.4   SUCCESSORS AND ASSIGNS. This Agreement shall be binding on
Atlas and any successor thereto, whether by reason of merger, consolidation or
otherwise. The duties and obligations of Employee may not be assigned by
Employee.

            7.5   CONFIDENTIALITY OF TERMS. Atlas, and Employee agree that the
terms and conditions of this Agreement are confidential and that they will not
disclose the terms of this Agreement to any third parties, other than the
Employee's spouse, their attorneys, auditors, accountants or as required by law
or as may be necessary to enforce this Agreement.

            7.6   FULL UNDERSTANDING. Employee declares and represents that
Employee has carefully read and fully understands the terms of this Agreement,
has had the opportunity to obtain advice and assistance of counsel with respect
thereto, and knowingly and of Employee's own free will, without any duress,
being fully informed and after due deliberation, voluntarily

                                       11



accepts the terms of this Agreement and represents that the execution, delivery
and performance of this Agreement does not violate any agreement to which
Employee is subject.

            7.7   ENTIRE AGREEMENT. This Agreement sets forth the entire
agreement and understanding between the parties with respect to the subject
matter hereof and (except for any prior indemnity agreements, restricted stock
agreements or stock option agreements) supersedes all prior agreements,
arrangements, and understandings between the parties with respect to the subject
matter hereof.

            IN WITNESS WHEREOF, the parties hereto have executed this agreement
the date, and year first above written.

EMPLOYEE                                ATLAS AIR, INC.

/s/ John W. Dietrich                    /s/ Illegible
- --------------------------------        --------------------------------
John W. Dietrich


                                       12

EX-10.20.1

                                                                      EX-10.20.1

                              EMPLOYMENT AGREEMENT

            This EMPLOYMENT AGREEMENT, dated as of November 1, 2000,
("AGREEMENT"), is -made by and between JAMES CATO ("EMPLOYEE") and ATLAS AIR,
INC. ("ATLAS").

            WHEREAS, EMPLOYEE warrants that he is entering voluntarily into this
Agreement, and that no promises or inducements for this Agreement have been made
outside the terms and conditions referred to herein; and EMPLOYEE enters into
this Agreement without reliance upon any statement or representation by ATLAS or
any other person, concerning any fact material hereto.

            NOW, THEREFORE, in consideration of the covenants contained herein,
EMPLOYEE and ATLAS agree to this Employment Agreement.

1.    DEFINITIONS.

            1.1   For purposes of this Agreement, "CAUSE" means (i) any act or
acts of material dishonesty by EMPLOYEE; (ii) failure of EMPLOYEE to comply with
any of EMPLOYEE'S obligations under this Agreement; or (iii) the conviction of
or "no contest" plea by EMPLOYEE to any misdemeanor of moral turpitude or any
felony; or (iv) any violation of ATLAS corporate policies as set forth in the
EMPLOYEE Compliance Manual and related -corporate policies; PROVIDED THAT, if
any violation of (ii) or (iv) is subject to cure, EMPLOYEE shall have ten (10)
days within which to cure such violation after written notice.

            1.2   "PERMANENT DISABILITY" as used herein shall be deemed to have
been sustained by EMPLOYEE during his employment if he shall have been
continuously disabled from performing-the duties assigned to him a period of six
(6) consecutive calendar months, and such Permanent Disability shall be deemed
to have commenced on the day following the end of such six consecutive calendar
months.




            1.3   "Good Reason" as used herein means (i) a reduction during the
term of this Agreement in the Employee's Base Annual Salary below One Hundred
and Ninety Five Thousand ($195,000) Dollars, (ii) a substantial reduction in the
Employee's title or job responsibilities from the Employee's title or job
responsibilities on the date of this Agreement, and (iii) an involuntary
assignment to work at a location other than in the New York area.

      2.    EMPLOYMENT AND OBLIGATIONS OF EMPLOYEE.

            2.1   EMPLOYMENT. ATLAS agrees to employ EMPLOYEE, and EMPLOYEE
shall serve, as Vice President Labor Relations of ATLAS. EMPLOYEE shall not be
entitled to any additional compensation for serving in any other office or
capacity for ATLAS or any of its affiliates.

            2.2   Obligations of EMPLOYEE. EMPLOYEE agrees, except when
prevented by illness, Permanent Disability or period of vacation, to devote
substantially all of his business time and attention to the good-faith
performance of the duties contemplated hereunder.

            2.3   PRINCIPLE RESIDENCE OF EMPLOYEE. EMPLOYEE shall be under no
obligation to move to the greater New York area or other location to which he
may be assigned and agree to work, and may maintain his current principle
residence at his option anywhere in the continental United States.

      3.    COMPENSATION AND BENEFITS.

            ATLAS shall pay to EMPLOYEE, during the period of his employment
hereunder, as follows:

            3.1   BASE SALARY. ATLAS shall pay to EMPLOYEE, on a semi-monthly
basis, a- Base -Salary of Seven Thousand Nine Hundred Sixteen and 67/100 (USD
$8,125.00), which equals an annual Base Salary One Hundred Ninety Thousand (USD
$195,000.00).

                                       2



            3.2   INCENTIVE BONUS PLAN. Under ATLAS' Incentive Bonus Plan,
EMPLOYEE shall obe eligible to receive annually a bonus in an amount equal to- a
target of seventy-five - percent (75%) of his annual Base Salary (60 percent
cash - and 40 percent of restricted- stock or restricted stock units) (pro-rated
for periods less than a full year as in 2000). EMPLOYEE shall be eligible-to
participate in any successor Plan.

            3.3   STOCK OPTIONS. EMPLOYEE shall be entitled to an option of
56,250 shares of- ATLAS stock, all of which shall vest on October 31, 2005,
subject to terms of the Stock Option Agreement. The option exercise price shall
be the mean between the high and low on the NYSE on October 31, 2000, (USD
$36.75). All other terms of this grant are contained in the Stock Option
Agreement which is incorporated herein and made a part hereof. Employee will
also be eligible to participate in ATLAS' Annual Stock Option Plan with a target
of 11,250 options annually.

            3.4   PROFIT SHARING. EMPLOYEE shall be eligible to participate in
ATLAS' profit sharing plan at the, start of the month following his one (1) year
anniversary as a full-time Employee.

            3.5   401K PLAN. EMPLOYEE shall be eligible after 90 days to
participate in ATLAS' 401K Plan which provides for a fifty percent (50%) match
by ATLAS of EMPLOYEE's contribution (subject to certain vesting periods and
limitations).

            3.6   STOCK PURCHASE PLAN. EMPLOYEE will be eligible to participate
in ATLAS' Stock Purchase Plan (at such time as the plan provides) whereby
EMPLOYEE may purchase ATLAS stock at a fifteen percent (15%) discount, up to an
aggregate of 15% of EMPLOYEE's annual Base Salary.

                                       3



            3.7   HEALTH CARE. EMPLOYEE shall be eligible after 90 days for
benefits provided under ATLAS' "cafeteria plan." ATLAS will reimburse EMPLOYEE
for expenses incurred for COBRA coverage from his former -employer for the 90
day period prior to coverage by ATLAS' plan. ATLAS reserves the right to
discontinue participation in any health insurance plan at any time, with the
understanding that ATLAS will comply in full measure with all state and federal
laws regarding the changes of insurance coverage by private employers and
notification under COBRA.

            3.8   VACATIONS. EMPLOYEE shall receive the same vacation time as
awarded to other Vice Presidents.

            3.9   COMPANY VEHICLE. Employee will receive-use of a company car at
a value of $40,000.00 or less (except as may otherwise be approved), with ATLAS
paying all expenses except gas.

            3.10  RELOCATION EXPENSES. Should EMPLOYEE opt to move to the New
York area, ATLAS will reimburse EMPLOYEE for reasonable and customary moving
expenses (including gross-up for taxes) from EMPLOYEE's principle residence to
the New York area or other area to which he may be assigned and agree to work.
Reasonable familiarization travel expenses of your immediate family will be
reimbursed, and a buy-down of interest rates on your New York mortgage will also
be discussed. Should EMPLOYEE choose not to relocate to the New York location to
which he may be assigned and agree to work, ATLAS will provide lodging, meals,
and transportation (ground and air) for your commuting trips to New York
(including gross up for taxes), and at EMPLOYEE's option transportation for
Employee's spouse to New- York in lieu of transportation home, for EMPLOYEE.
Should EMPLOYEE elect to relocate to the New York area or other area to which he
may be assigned and agree to

                                       4



work, at the .end of his employment with ATLAS, ATLAS agrees to relocate
EMPLOYEE anywhere in the continental United States on the same basis upon which
it provided relocation to the New York or other area, including gross-up for
taxes.

            3.11  SIGN-ON BONUS. EMPLOYEE shall receive a sign-on bonus of
Twelve Thousand Dollars (USD $12,000) within 30 days of commencement of the
Employment Period, which amount will be returned to ATLAS if the Employment
Period is terminated by ATLAS for "Cause" or-by EMPLOYEE without "Good Reason"
within one year from commencement of the Employment Period. In any event,
EMPLOYEE will retain the November 2000 retainer.

      4.    TERMINATION OF EMPLOYMENT.

            EMPLOYEE's employment contemplated hereunder shall terminate under
the following conditions:

            4.1   AT-WILL ARRANGEMENT. The EMPLOYEE's employment may be
terminated -hereunder at any time, for any reason, by either ATLAS or EMPLOYEE
upon written notice of the terminating party to the other. ATLAS and EMPLOYEE
each expressly understand and agree that the employment relationship defined
hereunder is "at-will."

            4.2   Rights Following Termination.

                  4.2.1  Upon EMPLOYEE's death or Permanent Disability, the
employment contemplated hereunder shall terminate, and EMPLOYEE's unpaid annual
Base Salary and profit sharing amounts shall be paid to EMPLOYEE or his personal
representative, as of that date, but no other benefits or remuneration
hereunder, except for any disability benefits to, which Employee may be entitled
pursuant to any Atlas disability plan applicable to EMPLOYEE.

                  4.2.2  If EMPLOYEE is terminated by ATLAS other than for Cause
or by EMPLOYEE for Good Reason, EMPLOYEE shall receive, -upon execution of a
Release

                                       5



reasonably satisfactory to ATLAS, one (1) full year's annual Base Salary due
under EMPLOYEE'S Employment Contract or the annual base salary in effect for
EMPLOYEE at the time of his termination of employment, whichever is higher.

                  4.2.3  If the Employment Period is terminated by ATLAS for
Cause or by -EMPLOYEE for other than Good Reason, -EMPLOYEE shall be entitled to
receive his Base Annual. Salary in effect at the, time of termination which is
owed but unpaid as of the date of termination.

            4.3   NON-COMPETITION PROVISION. EMPLOYEE covenants and agrees that
he will not, at any time before five (5) years after his termination of
employment with ATLAS, reveal, divulge or make known to any third party any
confidential or proprietary records, data, trade secrets, pricing policies,
strategy, rate structure, personnel policy, management methods, financial
reports, methods or practice of obtaining or doing business, or any other
Information of ATLAS or any of its affiliates which is not in-the public domain,
except as required by law.

            EMPLOYEE further agrees that-he will neither accept employment with
or give advice to any air cargo carrier or an air cargo division or' cargo
affiliate of any other airline for a period of one (1) year after termination of
employment, except with the consent of Atlas which shall not be unreasonably
withheld.

            EMPLOYEE further agrees that at no time before two (2) years -after
..his termination of employment with ATLAS will he engage in any of the following
activities directly or indirectly, for any reason, whether for his own account
or for the account of any other person, firm, corporation or other organization:

                  4.3.1  Solicit or otherwise interfere with any of ATLAS'
contracts or relationships with any client, employee, officer, director or any
independent contractor, whether

                                       6



the person is employed by or associated with ATLAS on the' date of this
Agreement or at any time thereafter.

                  4.3.2  Solicit or otherwise interfere with any of ATLAS'
contracts or relationships with any independent contractor, customer, client or
supplier, or any person who is a bona fide prospective independent contractor,
customer, client or supplier of ATLAS.

                  4.3.3  The parties agree and intend that breach of this
non-competition clause shall subject EMPLOYEE to the full measure of contract
and equitable damages.

      5.    CONFIDENTIAL INFORMATION.

            EMPLOYEE acknowledges that he will receive certain non-public and
confidential information from or about ATLAS or its affiliates, including, but
not limited to, technical, financial and business information, forecasts and
projections, current and potential customers and strategic partners,' proposed
business deals, strategies, reports, plans (including, but not limited to,
financial, strategic, operating, commercial and fleet deployment plans), market
projections, software programs, data or any other confidential and proprietary
information relating to ATLAS and its affiliates. All such technical, financial
or other business information thus supplied by ATLAS to EMPLOYEE is hereinafter
called the "Information."

            Any Information supplied by ATLAS to EMPLOYEE shall be considered to
be confidential.

            5.1   The term "Information" as used herein does not include any
data or information which (i) has become generally known to the-public through
no wrongful act of the EMPLOYEE; (ii) has been rightfully received by EMPLOYEE
from a third party without restriction on disclosure and without, to the
knowledge of EMPLOYEE, a breach of an obligation of confidentiality running
directly or indirectly to ATLAS hereto; (iii) has been approved for release by a
written authorization by ATLAS; or (iv) has been disclosed pursuant to

                                       7



a requirement of a-governmental agency or of law without similar-restrictions or
other protections against public-disclosure, or is required to he disclosed by
operation of law.

            5.2   NONDISCLOSURE OBLIGATION. EMPLOYEE shall keep such Information
strictly confidential and shall not disclose such Information in whole or in
part, to any person except with the prior written consent of ATLAS or as
otherwise permitted hereunder.

            5.3   COMPLIANCE WITH LEGAL PROCESS. In the event that EMPLOYEE is
legally requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, Civil Investigative Demand or similar
process or, in the opinion of counsel for EMPLOYEE, by federal or state
securities or other statutes, regulations or laws) to disclose any Information,
EMPLOYEE shall promptly notify ATLAS of such request or requirement prior to
disclosure so that ATLAS may seek an appropriate protective order and/or waive
compliance with the terms of this Agreement.

            5.4   OWNERSHIP; RETURN OF INFORMATION. No license, or any other
property right, or any trademark, trade secret, patent. copyright, or any other
intellectual property right, is granted to EMPLOYEE or implied by the conveying
of Information by ATLAS to EMPLOYEE. All Information (including tangible copies
and computerized or electronic version thereof) which is incorporated into
analysis, compilations, comparisons, studies or other documents prepared by or
for EMPLOYEE shall remain the proprietary property of ATLAS and, at-ATLAS' sole
discretion and direction, either destroyed by EMPLOYEE, or promptly returned in
full to ATLAS when instructed to or upon termination of this Agreement.

            5.5   TERM; TERMINATION. The obligations of EMPLOYEE to maintain the
confidentiality of Information he has received shall continue for a period of
five (5) years after -termination of this Employment Agreement.

                                       8



                  5.5.1 EMPLOYEE understands and agrees that money damages would
not be a sufficient remedy to ATLAS for any breach of confidentiality and' that
ATLAS shall be entitled to seek injunctive or other equitable relief to remedy
or forestall any such breach or threatened breach. Such remedy shall not be
deemed to be ATLAS' exclusive remedy for any breach of this Agreement, but shall
be in addition to all other rights -and remedies available to ATLAS at law or in
equity.

            5.6   NO WAIVER. No failure or delay by ATLAS or EMPLOYEE in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise thereof preclude any other- or
further exercise thereof of any other right, power or privilege hereunder.

            5.7   APPLICABILITY TO ASSOCIATED PARTIES. Any information disclosed
to the EMPLOYEE by any of ATLAS' affiliated companies or by any company, person
or other entity participating with ATLAS in any consortium, partnership, joint
venture or similar business combination which would otherwise constitute
Information hereunder shall be deemed to constitute Information under this
Agreement.

      6.    CHOICE OF LAW.

            This Agreement shall be governed by and construed .in accordance
with the laws of the State of New York, without reference to principles of
conflict of laws, and any-litigation or arbitration relating to the Agreement
shall be held in New York.

      7.    SEVERABILITY AND ENFORCEABILITY.

            It is expressly acknowledged and agreed that the covenants and
provisions hereof are severable; that the enforceability of one covenant or
provision shall in no event affect the full enforceability-of any other covenant
or provision herein. Further, it is agreed that in the event any covenant or
provision of this Agreement is found by any court of competent jurisdiction to

                                       9



be unenforceable, illegal or invalid, such invalidity, illegality or
unenforceability shall not affect any other term or condition contained herein.
The invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or unenforceability of any other provision of this
Agreement.

      8.    MISCELLANEOUS.

            8.1   EMPLOYEE understands and agrees that all ATLAS fringe benefit
plans (e.g., Profit Sharing, 401K, health care, etc.) are subject to eligibility
requirements, amendment, revision, and/or termination from time to time at
ATLAS' sole discretion,, and that any such action will be binding upon EMPLOYEE.

            8.2   PRORATION. In the event EMPLOYEE is terminated in the middle
of any calendar month, the Base Salary due EMPLOYEE for such month shall be
prorated on a daily basis.

            8.3   NO WAIVER EXCEPT IN WRITING. No waiver or modification of this
Agreement or any of the terms and conditions set forth herein shall be-
effective unless submitted in writing, duly executed by the parties.

            8.4   SUCCESSORS AND ASSIGNEES. This Agreement shall be binding on
ATLAS and any successor thereto, whether by reason of merger, consolidation or
otherwise. The duties and obligations of EMPLOYEE may not be assigned by
EMPLOYEE. -

            8.5   CONFIDENTIALITY OF TERMS. ATLAS and EMPLOYEE agree that the
terms and conditions of this Agreement are confidential and that neither party
shall disclose the terms of this Agreement to any third parties, other than
EMPLOYEE's spouse, the parties' attorneys, auditors, or accountants, or as may
be required by law or necessity to enforce this Agreement.

            8.6   FULL UNDERSTANDING. EMPLOYEE declares and -represents that he
has carefully read and fully understands the terms of this Agreement; has had
the opportunity to

                                       10



obtain advice and assistance of counsel with respect thereto, and knowingly and
of his own free will, without any duress, being fully informed and after due
deliberation, voluntarily accepts the terms of this Agreement.

            8.7   ENTIRE AGREEMENT. This Agreement sets forth the entire
agreement and understanding between the parties with respect to the subject,
matter hereof and supersedes all prior agreements, arrangements and
understandings between the parties with respect to the subject matter hereof.

      9.    DISPUTE RESOLUTION.

            9.1   NEGOTIATION. If a dispute between the Parties arises under
this Agreement, the Parties shall negotiate in good faith in an attempt to
resolve their differences. The obligation of the Parties to negotiate in good
faith shall commence immediately, and shall continue for a period of at least
thirty (30) days (Negotiation).

            If Negotiation fails to resolve a dispute between the Parties within
the first Thirty (30) days, either Party may proceed to demand mediation
(Mediation). Upon agreement of both Parties, arbitration may be initiated
immediately, in lieu of Mediation.

            9.2   MEDIATION. If a dispute between the Parties arises under this
Agreement and has not been resolved under the Negotiation procedures described
herein, either Party may require, by written notice to the other Party, that
Negotiation be facilitated by a single mediator, to be selected by the Parties
(the Mediator).

            The Parties shall select the-Mediator within ten (10) days alter
receipt of notice. If the Parties are unable to agree on the Mediator, the
Mediator shall be selected by ATLAS, but the selected Mediator shall be
independent of ATLAS and its affiliates. The fees of the Mediator shall be
divided equally between the Parties.

                                       11



            With the, assistance of the Mediator, the Parties shall continue
Negotiation in good faith for a period not to exceed thirty (30) days. If the
Parties are unable to reach agreement during this period, the Mediator shall be
discharged and the Parties' obligations under this Mediation section shall be
deemed satisfied.

            9.3   ARBITRATION. Subject to the duty to negotiate and mediate set
forth above, all disputes, claims, or causes of action arising out of or
relating to this Agreement or the validity, interpretation, breach, violation,
or termination thereof not resolved by Mediation, shall be finally and solely
determined and settled by Arbitration, to be conducted in the State of New York,
USA, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association (AAA) in effect at the date of Arbitration.

            Any Arbitration commenced pursuant to this Agreement shall be
conducted by a single neutral arbitrator, who shall have a minimum of three (3)
years of commercial experience (the Arbitrator). The Parties shall meet within
ten (10) days of failure to resolve by Mediation to attempt to agree on an
Arbitrator. Absent agreement at this meeting, the Arbitrator shall be selected
by AAA. Such Arbitrator shall be free of any conflicts with ATLAS and shall hold
a hearing within thirty (30) days of the notice to EMPLOYEE.

            If the terms and conditions of this Agreement are inconsistent with
the-Commercial Arbitration Rules 0-f the AAA, the terms and conditions of this
Agreement shall control.

            The Parties hereby consent to any process, notice, or other
application to said courts and any document in connection with Arbitration may
be served by (i) certified mail, return receipt requested; (ii) by personal
service; or (iii) in such other manner as may be permissible under the rules of
the applicable court or Arbitration tribunal; provided, however, a

                                       12



reasonable time for appearance is allowed. The Parties further agree that
Arbitration proceedings must be instituted within one (1) year after the
occurrence of any dispute, and failure to institute Arbitration proceedings
within such time period shall constitute an absolute bar to the institution of
any proceedings and a waiver of all claims.

            The Parties shall equally divide, all costs and `expenses incurred
in such proceeding and related legal proceedings.

            The Judgment of the Arbitrator shall be final and either Party may
submit such decision to courts for enforcement thereof.

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

                                        ATLAS AIR, INC.



                                        By: /s/ Illegible
                                           -------------------------------------



                                        EMPLOYEE:

                                        By: /s/ James Cato
                                           -------------------------------------
                                           Name: James Cato


                                       13



                 AMENDMENT TO EMPLOYMENT AGREEMENT OF JAMES CATO

            WHEREAS, ATLAS AIR, INC. ("ATLAS"), and James Cato ("EMPLOYEE") wish
to update, amend and modify the provisions of the Employment Agreement dated
November 1, 2000 between them (the "AGREEMENT") as set forth in this amendment
(the "Amendment").

            Now, therefore, ,for good and valuable consideration the receipt of
which is hereby acknowledged, the AGREEMENT is hereby updated, amended and
modified as follows:

A.    Section 3.1 shall be amended to read as follows: `Effective February 1,
      2004, ATLAS shall pay to EMPLOYEE, on a semi-monthly basis, a Base Salary
      of Ten Thousand Dollars, (USD $10,000.00) which equals an Annual Base
      Salary of Two Hundred and Forty Thousand Dollars (USD $240,000.00).

B.    Section 3.2 shall be amended by striking "seventy-five -percent (75%)" in
      line three and replacing it with "fifty percent (50%)".

C.    Section 4.2.2 ,shall be amended by striking the words

            "one (1) full year's annual" in line 3 and replacing them with
            one and one-half (1.5) times EMPLOYEE' s Annual Base Salary as
            provided for in paragraph 3.1.

                                       14



            With the exception of the amendments and modifications reflected in
paragraphs A, B, and C, above, the AGREEMENT otherwise remains in full force and
effect.

AGREED TO AND ACCEPTED BY:

EMPLOYEE

/s/ James Cato                          Jan. 29, 2004
- -------------------------------------   -------------
                                        Date
James Cato

ATLAS AIR

/s/ John Dietrich                       Jan. 29, 2004
- -------------------------------------   -------------
                                        Date
Name:  John Dietrich


                                       15

EX-10.21.1

                                                                      EX-10.21.1









                       ATLAS AIR WORLDWIDE HOLDINGS, INC.

                                BENEFITS PROGRAM

                          EXECUTIVE VICE PRESIDENTS AND
                             SENIOR VICE PRESIDENTS






                               As of March 1, 2005




                       ATLAS AIR WORLDWIDE HOLDINGS, INC.


      This document describes the benefits program for individuals employed as
Executive Vice Presidents or Senior Vice Presidents of Atlas Air, Inc. ("Atlas")
and Polar Air Cargo, Inc. ("Polar") (such individuals are hereinafter referred
to as "Executives"), as in effect on March 1, 2005. Individuals employed as
Executive Vice Presidents or Senior Vice Presidents by other subsidiaries of
Atlas Air Worldwide Holdings, Inc. ("Holdings") may participate in this program
only if expressly approved for such participation by the Board of Directors of
Holdings. All references in this document to the Compensation Committee or the
Board of Directors refers to those bodies of Holdings. All references to the
Employer are to the corporation employing the Executive.

I.    ANNUAL SALARY.

The Executive will receive a base annual salary ("Base Annual Salary") reviewed
annually for possible increases by the Compensation Committee, subject to the
approval of the Board of Directors. Included among other considerations in the
annual review will be the Executive's individual job performance. Increases, if
any shall be at the discretion of Holdings.

II.   BONUS PLAN.

The Executive shall be eligible to participate in Holdings' Annual Incentive
Plan or successor plan at the Executive Vice President or Senior Vice President
level, as appropriate. The level of the bonus available to the Executive will be
set forth in the Annual Incentive Plan and will be awarded in consideration of
individual and corporate performance based on performance goals and objectives
determined by the Holdings Compensation Committee. A fuller description of how
corporate and individual performance operate in tandem to determine the
calculation of bonuses will be described in the Annual Incentive Plan. The
Annual Incentive Plan document will be developed by the Holdings Compensation
Committee and is subject to amendment from time to time with changes as adopted
by the Compensation Committee or full Board of Directors of Holdings. As further
described in the Annual Incentive Plan, corporate and individual performance in
combination may permit the Executive to earn a target bonus equal to 50% of Base
Annual Salary. Lesser corporate or individual performance may cause bonus
payments to be in an amount less than 50% of Base Annual Salary or result in no
bonus being payable. Greater corporate and individual performances may result in
the bonus being more than 50% of Base Annual Salary. When the bonus payment
reaches more than 50% of Base Annual Salary, the Employer reserves the right to
pay some or all of the portion of the bonus that is above 50% of Base Annual
Salary in Holdings unrestricted company stock payable under the Atlas Air
Worldwide Holdings, Inc. 2004 Long Term Incentive and Share Award Plan. Any
bonus paid under the Annual Incentive Plan will be paid no later than two weeks
following the completion of the year-end audit for the applicable year.




III   HEALTH BENEFITS.

The Executive and Executive's dependents shall be entitled to participate in the
health insurance plan offered by Executive's Employer, provided that the
Executive and the Employer will each contribute to the Executive's monthly
premium as provided by such plan. The Employer reserves the right to discontinue
any health insurance plan at any time with the understanding that the Employer
will comply in full measure with all state and federal laws regarding
continuation of coverage under the Consolidated Omnibus Budget Reconciliation
Act.

IV.   SEVERANCE.

      A.    If the Executive's employment is terminated by the Employer for
reasons other than Cause or if the Executive resigns for Good Reason, and
subject to the Executive's execution of a release upon terms and conditions
acceptable to the Employer, the Executive shall be entitled to: (i) receive a
severance payment equal to twelve (12) months of the Executive's monthly Base
Salary, payable in accordance with the Employer's normal pay schedule; and (ii)
continued coverage under the Employer's health benefit plan for a period of'12
months from the date of termination; PROVIDED, HOWEVER, that any such continued
coverage shall cease in the event the Executive obtains comparable coverage in
connection with subsequent employment, and to the extent the Employer is unable
to continue such coverage, the Employer shall provide the Executive with
economically equivalent benefits determined on an after-tax basis. The severance
payment described in subsection (i) shall be payable to the Executive's personal
representative in the event the Executive terminates employment as a result of
death.

      B.    If the Executive's employment is terminated by the Employer for
Cause or by the Executive's resignation for other than Good Reason, the
Executive shall be entitled to receive only the Executive's accrued but unpaid
Base Salary as of the date of termination.

      C.    If the Executive's employment is terminated as a result of Permanent
Disability, the Executive shall be entitled to receive the Executive's accrued
but unpaid Base Salary as of the date of termination, the benefits described in
Section IV.A, above, plus any benefits to which he is then entitled under the
Employer's disability program, if any.

      D.    "Good Reason" as used herein shall mean for any Executive subject to
this Benefit Program, any of (i) a reduction in the Executive's Base Salary from
the Base Salary the previous year, except where such reduction is part of a
general salary reduction for the Employer, (ii) the Executive ceasing to hold
the title of Executive Vice President or Senior Vice President, as the case may
be, other than through promotion or through reassignment to another job title of
comparable responsibility, and (iii) any reduction in job responsibilities which
diminishes the opportunity for the Executive to earn the same bonus under the
Annual Incentive Plan for which the Executive was previously eligible.

      E.    "Cause" as used herein shall mean (i) any act or acts of material
dishonesty by the Executive, (ii) the failure of the Executive to comply with
any of the Executive's material obligations within ten (10) days of written
notice from the Employer, (iii) any material violations by the Executive of the
Employer's corporate policies as set forth in the Employer's Compliance




Manual, employee Handbook or related corporate policies; provided that, if such
violation is subject to cure, the Executive shal1 have ten (10) days within
which to cure such- violation, or (iv) the conviction of or "no contest" plea by
the Executive to any misdemeanor of moral turpitude or any felony.

      F.    "Permanent Disability" as used herein shall be deemed to have been
sustained by the Executive if the Executive shall have been continuously
disabled from performing the duties assigned to the Executive for a period of
six (6) consecutive calendar months, and such Permanent Disability shall be
deemed to have commenced on the day following the end of such six (6)
consecutive calendar months.

V.    VACATION.

The Executive shall be entitled to four weeks of paid vacation per year,
prorated for partial years of employment.

VI.   401(K) PLAN AND OTHER BENEFITS.

The Executive shall be eligible to participate in the Employer's 401(k) plan and
any other pension or welfare plan generally available from time to time to
employees of the Employer, as determined by the Compensation Committee and
approved by the Board of Directors.

VII.  NON-COMPETITION.

As a condition of employment and participation in this Benefits Program, the
Executive shall execute a Non-Competition Agreement in a form approved by
Holdings.

VIII. PRINCIPAL RESIDENCE

Executive shall be required to maintain their principal residence in the
Purchase, New York area.

IX.   VARIATIONS FROM BENEFITS PROGRAM.

Any variation from the provisions of this Benefit Program shall be effective
only if such variation is contained in a writing provided to the affected
Executive and signed by the President of the Employer.

EX-10.22.1

                                                                      EX-10.22.1






                       ATLAS AIR WORLDWIDE HOLDINGS, INC.

                                BENEFITS PROGRAM

                                 VICE PRESIDENTS






                               As of March 1, 2005




                       ATLAS AIR WORLDWIDE HOLDINGS, INC.


      This document describes the benefits program for individuals employed as
Vice Presidents of Atlas Air, Inc. ("Atlas") and Polar Air Cargo, Inc.
("Polar"), as in effect on March 1, 2005. Individuals employed as Vice
Presidents employed by other subsidiaries of Atlas Air Worldwide Holdings, Inc.
("Holdings") may participate in this program only if expressly approved for such
participation by the Board of Directors of Holdings. All references in this
document to the Compensation Committee or the Board of Directors refers to those
bodies of Holdings. All references to the Employer are to the corporation
employing the Vice President.

I.    ANNUAL SALARY.

The Vice President will receive a base annual salary ("Base Annual Salary")
reviewed annually for possible increases by the Compensation Committee, subject
to the approval of the Board of Directors. Included among other considerations
in the annual review will be the Vice President's individual job performance.
Increases, if any shall be at the discretion of Holdings.

II.   BONUS PLAN.

The Vice President shall be eligible to participate in Holdings' Annual
Incentive Plan or successor plan at the Vice President level. The level of the
bonus available to the Vice President will be set forth in the Annual Incentive
Plan and will be awarded in consideration of individual and corporate
performance based on performance goals and objectives determined by the Holdings
Compensation Committee. A fuller description of how corporate and individual
performance operate in tandem to determine the calculation of bonuses will be
described in the Annual Incentive Plan. The Annual Incentive Plan document will
be developed by the Holdings Compensation Committee and is subject to amendment
from time to time with changes as adopted by the Compensation Committee or full
Board of Directors of Holdings. As further described in the Annual Incentive
Plan, corporate and individual performance in combination may permit the Vice
President to earn a target bonus equal to 50% of Base Annual Salary. Lesser
corporate or individual performance may cause bonus payments to be in an amount
less than 50% of Base Annual Salary or result in no bonus being payable. Greater
corporate and individual performances may result in the bonus being more than
50% of Base Annual Salary. When the bonus payment reaches more than 50% of Base
Annual Salary, the Employer reserves the right to pay some or all of the portion
of the bonus that is above 50% of Base Annual Salary in Holdings unrestricted
company stock payable under the Atlas Air Worldwide Holdings, Inc. 2004 Long
Term Incentive and Share Award Plan. Any bonus paid under the Annual Incentive
Plan will be paid no later than two weeks following the completion of the
year-end audit for the applicable year.

III   HEALTH BENEFITS.

The Vice President and Vice President's dependents shall be entitled to
participate in the health insurance plan offered by Vice President's Employer,
provided that the Vice President and the Employer will each contribute to the
Vice President's monthly premium as provided by such




plan. The Employer reserves the right to discontinue any health insurance plan
at any time with the understanding that the Employer will comply in full measure
with all state and federal laws regarding continuation of coverage under the
Consolidated Omnibus Budget Reconciliation Act.

IV.   SEVERANCE.

      A.    If the Vice President's employment is terminated by the Employer for
reasons other than Cause or if the Vice President resigns for Good Reason, and
subject to the Vice President's execution of a release upon terms and conditions
acceptable to the Employer, the Vice President shall be entitled to: (i) receive
a severance payment equal to nine (9) months of the Vice President's monthly
Base Salary, payable in accordance with the Employer's normal pay schedule; and
(ii) continued coverage under the Employer's health benefit plan for a period
of'12 months from the date of termination; PROVIDED, HOWEVER, that any such
continued coverage shall cease in the event the Vice President obtains
comparable coverage in connection with subsequent employment, and to the extent
the Employer is unable to continue such coverage, the Employer shall provide the
Vice President with economically equivalent benefits determined on an after-tax
basis. The severance payment described in subsection (i) shall be payable to the
Vice President's personal representative in the event the Vice President
terminates employment as a result of death.

      B.    If the Vice President's employment is terminated by the Employer for
Cause or by the Vice President's resignation for other than Good Reason, the
Vice President shall be entitled to receive only the Vice President's accrued
but unpaid Base Salary as of the date of termination.

      C.    If the Vice President's employment is terminated as a result of
Permanent Disability, the Vice President shall be entitled to receive the Vice
President's accrued but unpaid Base Salary as of the date of termination, the
benefits described in Section IV.A, above, plus any benefits to which he is then
entitled under the Employer's disability program, if any.

      D.    "Good Reason" as used herein shall mean for any Vice President
subject to this Benefit Program, any of (i) a reduction in the Vice President's
Base Salary from the Base Salary the previous year, except where such reduction
is part of a general salary reduction for the Employer, (ii) the Vice
President's ceasing to hold the title of Vice President, other than through
promotion or through reassignment to another job title of comparable
responsibility, and (iii) any reduction in job responsibilities which diminishes
the opportunity for the Vice President to earn the same bonus under the Annual
Incentive Plan for which the Vice President was previously eligible.

      E.    "Cause" as used herein shall mean (i) any act or acts of material
dishonesty by the Vice President, (ii) the failure of the Vice President to
comply with any of the Vice President's material obligations within ten (10)
days of written notice from the Employer, (iii) any material violations by Vice
President of the Employer's corporate policies as set forth in the Employer's
Compliance Manual, employee Handbook or related corporate policies; provided
that, if such violation is subject to cure, Vice President shal1 have ten (10)
days within which to cure such- violation, or (iv) the conviction of or "no
contest" plea by the Vice President to any misdemeanor of moral turpitude or any
felony.




      F.    "Permanent Disability" as used herein shall be deemed to have been
sustained by the Vice President if the Vice President shall have been
continuously disabled from performing the duties assigned to the Vice President
for a period of six (6) consecutive calendar months, and such Permanent
Disability shall be deemed to have commenced on the day following the end of
such six (6) consecutive calendar months.

V.    VACATION.

The Vice President shall be entitled to four weeks of paid vacation per year,
prorated for partial years of employment.

VI.   401(K) PLAN AND OTHER BENEFITS.

The Vice President shall be eligible to participate in the Employer's 401(k)
plan and any other pension or welfare plan generally available from time to time
to employees of the Employer, as determined by the Compensation Committee and
approved by the Board of Directors.

VII.  NON-COMPETITION.

As a condition of employment and participation in this Benefits Program, the
Vice President shall execute a Non-Competition Agreement in a form approved by
Holdings.

VIII. PRINCIPAL RESIDENCE

Vice Presidents shall be required to maintain their principal residence in the
Purchase, New York area.

IX.   VARIATIONS FROM BENEFITS PROGRAM.

Any variation from the provisions of this Benefit Program shall be effective
only if such variation is contained in a writing provided to the affected Vice
President and signed by the President of the Employer.

EX-10.25.1

                                                                      EX-10.25.1


                       ATLAS AIR WORLDWIDE HOLDINGS, INC.

               CASH COMPENSATION OF NON-EMPLOYEE DIRECTORS - 2005

     Each non-employee Director of Atlas Air Worldwide Holdings, Inc. will be
paid $50,000 in cash compensation annually, which will be payable quarterly in
advance, and will also receive the following ADDITIONAL cash compensation, as
applicable:

COMMITTEE MEMBERSHIP

         o  Each member of the Audit and Governance Committee, $15,000 annually
            [which will be payable quarterly in advance];

         o  Each member of the Compensation Committee, $5,000 annually [which
            will be payable quarterly in advance];

CHAIRMAN POSITION

         o  Chairman of the Board, $75,000 annually [which will be payable
            quarterly in advance];

         o  Chairman of each of the Audit and Governance Committee and the
            Compensation Committee, $25,000 annually [which will be payable
            quarterly in advance];

MEETING FEES

         o  For each meeting of the Board or a Committee of the Board, including
            any ad hoc committee, attended in person by a member, a fee to such
            member of (x) $1,500 or (y) $3,000 if such member is its Chairman
            [which will be payable at the end of such quarter]; and

         o  For each meeting of the Board or a Committee of the Board, including
            any ad hoc committee, attended via teleconference or
            videoconference, a fee to each such member of (x) $500 or (y) $1,000
            if such member is its Chairman [which will be payable quarterly at
            the end of such quarter].

EX-10.28.1

                                                                 EXHIBIT 10.28.1




                       ATLAS AIR WORLDWIDE HOLDINGS, INC.
                         2004 EMPLOYEE STOCK OPTION PLAN

                  1. PURPOSES.

                  The purpose of the Atlas Air Worldwide Holdings, Inc. 2004
Employee Stock Option Plan is to advance the interests of Atlas Air Worldwide
Holdings, Inc. and its shareholders by providing a means to attract, retain, and
motivate employees, to provide for competitive compensation opportunities, to
encourage long term service, to recognize individual contributions and reward
achievement of performance goals, and to promote the creation of long term value
for stockholders by aligning the interests of such employees with those of
stockholders.

                  2. DEFINITIONS.

                  For purposes of the Plan, the following terms shall be defined
as set forth below:

                  (a) "Affiliate" means any entity other than the Company and
its Subsidiaries that is designated by the Board or the Committee as a
participating employer under the Plan; PROVIDED, HOWEVER, that the Company
directly or indirectly owns at least 20% of the combined voting power of all
classes of stock of such entity or at least 20% of the ownership interests in
such entity.

                  (b) "Beneficiary" means the person, persons, trust or trusts
which have been designated by an Eligible Person in his or her most recent
written beneficiary designation filed with the Company to receive the benefits
specified under this Plan upon the death of the Eligible Person, or, if there is
no designated Beneficiary or surviving designated Beneficiary, then the person,
persons, trust or trusts entitled by will or the laws of descent and
distribution to receive such benefits.

                  (c) "Board" means the Board of Directors of the Company.

                  (d) "Code" means the Internal Revenue Code of 1986, as amended
from time to time. References to any provision of the Code shall be deemed to
include successor provisions thereto and regulations thereunder.

                  (e) "Committee" means the Compensation Committee of the Board,
or such other Board committee (which may include the entire Board) as may be
designated by the Board to administer the Plan; PROVIDED, HOWEVER, that, unless
otherwise determined by the Board, the Committee shall consist of two or more
directors of the Company, each of whom is



                                      -2-



a "non-employee director" within the meaning of Rule 16b-3 under the Exchange
Act, to the extent applicable, and each of whom is an "outside director" within
the meaning of Section 162(m) of the Code, to the extent applicable; PROVIDED,
FURTHER, that the mere fact that the Committee shall fail to qualify under
either of the foregoing requirements shall not invalidate any Option granted
made by the Committee which Option is otherwise validly granted under the Plan.

                  (f) "Company" means Atlas Air Worldwide Holdings, Inc., a
corporation organized under the laws of Delaware, or any successor corporation.

                  (g) "Eligible Person" means an employee of the Company, a
Subsidiary or an Affiliate, who is covered by a collective bargaining agreement
that provides or allows for the granting of stock options.

                  (h) "Effective Date" means September 22, 2004.

                  (i) "Exchange Act" means the Securities Exchange Act of 1934,
as amended from time to time. References to any provision of the Exchange Act
shall be deemed to include successor provisions thereto and regulations
thereunder.

                  (j) "Fair Market Value" means, with respect to Shares or other
property, the fair market value of such Shares or other property determined by
such methods or procedures as shall be established from time to time by the
Committee. If the Shares are listed on any established stock exchange or a
national market system, unless otherwise determined by the Committee in good
faith, the Fair Market Value of Shares shall mean the mean between the high and
low selling prices per Share on the date (or, if the Shares were not traded on
that day, the next preceding day that the Shares were traded) on the principal
exchange or market system on which the Shares are traded, as such prices are
officially quoted on such exchange.

(k)      "ISO" means any Option intended to be and designated as an incentive
         stock option within the meaning of Section 422 of the Code.

                  (l) "NQSO" means any Option that is not an ISO.

                  (m) "Option" means a right, granted under Section 5(b), to
purchase Shares.

                  (n) "Option Agreement" means any written agreement, contract,
or other instrument or document evidencing an Option.

                  (o) "Participant" means an Eligible Person who has been
granted an Option under the Plan.

                                      -3-


                  (p) "Plan" means this Atlas Air Worldwide Holdings, Inc. 2004
Employee Stock Option Plan.

                  (q) "Rule 16b-3" means Rule 16b-3, as from time to time in
effect and applicable to the Plan and Participants, promulgated by the
Securities and Exchange Commission under Section 16 of the Exchange Act.

                  (r) "Shares" means common stock, $.01 par value per share, of
the Company, and such other securities as may be substituted for Shares pursuant
to Section 4(c) hereof.

                  (s) "Subsidiary" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company if each
of the corporations (other than the last corporation in the unbroken chain) owns
shares possessing 50% or more of the total combined voting power of all classes
of stock in one of the other corporations in the chain.

                  (t) "Termination of Service" means the termination of the
Participant's employment with the Company, its Subsidiaries and its Affiliates,
as the case may be. A Participant employed by a Subsidiary of the Company or one
of its Affiliates shall also be deemed to incur a Termination of Service if the
Subsidiary of the Company or Affiliate ceases to be such a Subsidiary or an
Affiliate, as the case may be, and the Participant does not immediately
thereafter become an employee of the Company, another Subsidiary of the Company
or an Affiliate. Temporary absences from employment because of illness, vacation
or leave of absence and transfers among the Company and its Subsidiaries and
Affiliates shall not be considered a Termination of Service.

                  3. ADMINISTRATION.

                  (a) AUTHORITY OF THE COMMITTEE. The Plan shall be administered
by the Committee, and the Committee shall have full and final authority to take
the following actions, in each case subject to and consistent with the
provisions of the Plan:

                  (i) to select Eligible Persons to whom Options may be granted;

                  (ii) to designate Affiliates;

                  (iii) to determine the type and number of Options to be
          granted, the number of Shares to which an Option may relate, the terms
          and conditions of any Option granted under the Plan (including, but
          not limited to, any exercise price, any restriction or condition, any
          schedule for lapse of restrictions or conditions relating to
          transferability or forfeiture, exercisability, or settlement of an
          Option, and waiver or accelera-


                                      -4-


          tions thereof, and waivers of performance conditions relating to an
          Option, based in each case on such considerations as the Committee
          shall determine), and all other matters to be determined in connection
          with an Option;

                  (iv) to determine whether, to what extent, and under what
          circumstances an Option may be settled, or the exercise price of an
          Option may be paid, in cash, Shares, or other property, or an Option
          may be canceled, forfeited, exchanged, or surrendered;

                  (v) to prescribe the form of each Option Agreement, which need
          not be identical for each Eligible Person;

                  (vi) to adopt, amend, suspend, waive, and rescind such rules
          and regulations and appoint such agents as the Committee may deem
          necessary or advisable to administer the Plan;

                  (vii) to correct any defect or supply any omission or
          reconcile any inconsistency in the Plan and to construe and interpret
          the Plan and any Option, rules and regulations, Option Agreement, or
          other instrument hereunder;

                  (viii) to accelerate the exercisability or vesting of all or
          any portion of any Option or to extend the period during which an
          Option is exercisable;

                  (ix) to determine whether uncertificated Shares may be used in
          satisfying Options and otherwise in connection with the Plan; and

                  (x) to make all other decisions and determinations as may be
          required under the terms of the Plan or as the Committee may deem
          necessary or advisable for the administration of the Plan.

                  (b) MANNER OF EXERCISE OF COMMITTEE AUTHORITY. The Committee
shall have sole discretion in exercising its authority under the Plan. Any
action of the Committee with respect to the Plan shall be final, conclusive, and
binding on all persons, including the Company, Subsidiaries, Affiliates,
Eligible Persons, any person claiming any rights under the Plan from or through
any Eligible Person, and shareholders. The express grant of any specific power
to the Committee, and the taking of any action by the Committee, shall not be
construed as limiting any power or authority of the Committee. The Committee may
delegate to other members of the Board or officers or managers of the Company or
any Subsidiary or Affiliate the authority, subject to such terms as the
Committee shall determine, to perform administrative functions and, with respect
to Options granted to persons not subject to Section 16 of the Exchange Act, to
perform such other functions as the Committee may determine, to the extent
permitted under Rule 16b-3 (if applicable) and applicable law.

                                      -5-


                  (c) LIMITATION OF LIABILITY. Each member of the Committee
shall be entitled to, in good faith, rely or act upon any report or other
information furnished to him or her by any officer or other employee of the
Company or any Subsidiary or Affiliate, the Company's independent certified
public accountants, or other professional retained by the Company to assist in
the administration of the Plan. No member of the Committee, and no officer or
employee of the Company acting on behalf of the Committee, shall be personally
liable for any action, determination, or interpretation taken or made in good
faith with respect to the Plan, and all members of the Committee and any officer
or employee of the Company acting on their behalf shall, to the extent permitted
by law, be fully indemnified and protected by the Company with respect to any
such action, determination, or interpretation.

                  4. SHARES SUBJECT TO THE PLAN.

                  (a) Subject to adjustment as provided in Section 4(c) hereof,
the total number of Shares reserved for issuance in connection with Options
under the Plan shall be 495,303, with 300,000 of such Shares reserved for
issuance pursuant to that certain Letter of Agreement, dated as of the Effective
Date, between Atlas Air, Inc. and the Air Line Pilots in the service of Atlas
Air, Inc. as represented by The Air Line Pilots Association, International,
pursuant to the terms thereof. No Option may be granted if the number of Shares
to which such Option relates, when added to the number of Shares previously
issued under the Plan, exceeds the number of Shares reserved under the preceding
sentence. If any Options are forfeited, canceled, terminated, exchanged or
surrendered or such Option is settled in cash or otherwise terminates without a
distribution of Shares to the Participant, any Shares counted against the number
of Shares reserved and available under the Plan with respect to such Option
shall not be reallocated and available for Options under the Plan.

                  (b) In the event that the Committee shall determine that any
dividend in Shares, recapitalization, Share split, reverse split,
reorganization, merger, consolidation, spin-off, combination, repurchase, or
share exchange, or other similar corporate transaction or event, affects the
Shares such that an adjustment is appropriate in order to prevent dilution or
enlargement of the rights of Eligible Persons under the Plan, then the Committee
shall make such equitable changes or adjustments as it deems appropriate and, in
such manner as it may deem equitable, adjust any or all of (i) the number and
kind of shares which may thereafter be issued under the Plan, (ii) the number
and kind of shares, other securities or other consideration issued or issuable
in respect of outstanding Options, and (iii) the exercise price relating to any
Option; PROVIDED, HOWEVER, in each case that, with respect to ISOs, such
adjustment shall be made in accordance with Section 424(a) of the Code, unless
the Committee determines otherwise. In addition, the Committee is authorized to
make adjustments in the terms and conditions of, and the criteria and
performance objectives, if any, included in, Options in recognition of unusual
or non-recurring events (including, without limitation, events described in the
preceding sentence) affecting the Company or any Subsidiary or Affiliate or the
financial


                                      -6-


statements of the Company or any Subsidiary or Affiliate, or in response to
changes in applicable laws, regulations, or accounting principles.

                  (c) Any Shares distributed pursuant to an Option may consist,
in whole or in part, of authorized and unissued Shares or treasury Shares
including Shares acquired by purchase in the open market or in private
transactions.

                  5. SPECIFIC TERMS OF OPTIONS.

                  (a) GENERAL. Options may be granted on the terms and
conditions set forth in this Section 5. In addition, the Committee may impose on
any Option or the exercise thereof, at the date of grant or thereafter (subject
to Section 7(d)), such additional terms and conditions, not inconsistent with
the provisions of the Plan, as the Committee shall determine, including terms
regarding forfeiture of Options or continued exercisability of Options in the
event of Termination of Service by the Eligible Person.

                  (b) OPTIONS. The Committee is authorized to grant Options,
which may be NQSOs or ISOs, to Eligible Persons on the following terms and
conditions:

                  (i) EXERCISE PRICE. The exercise price per Share purchasable
          under an Option shall be determined by the Committee. The Committee
          may, without limitation, set an exercise price that is based upon
          achievement of performance criteria if deemed appropriate by the
          Committee.

                  (ii) OPTION TERM. The term of each Option shall be determined
          by the Committee; PROVIDED, HOWEVER, that such term shall not be
          longer than ten years from the date of grant of the Option.

                  (iii) TIME AND METHOD OF EXERCISE. The Committee shall
          determine at the date of grant or thereafter the time or times at
          which an Option may be exercised in whole or in part (including,
          without limitation, upon achievement of performance criteria if deemed
          appropriate by the Committee), the methods by which such exercise
          price may be paid or deemed to be paid (including, without limitation,
          broker-assisted exercise arrangements), the form of such payment
          (including, without limitation, cash, Shares or other property), and
          the methods by which Shares will be delivered or deemed to be
          delivered to Eligible Persons; PROVIDED, HOWEVER, that in no event may
          any portion of the exercise price be paid with Shares acquired either
          under an Option granted pursuant to this Plan, upon exercise of a
          stock option granted under another Company plan or as a stock bonus or
          other stock award granted under another Company plan unless, in any
          such case, the Shares were acquired and vested more than six months in
          advance of the date of exercise.

                                      -7-


                  (iv) ISOS. The terms of any ISO granted under the Plan shall
          comply in all respects with the provisions of Section 422 of the Code,
          including but not limited to the requirement that the ISO shall be
          granted within ten years from the earlier of the date of adoption or
          shareholder approval of the Plan. ISOs may only be granted to
          employees of the Company or a Subsidiary.

                  6. CERTAIN PROVISIONS APPLICABLE TO OPTIONS.

                  (a) STAND-ALONE, ADDITIONAL, TANDEM AND SUBSTITUTE OPTIONS.
Options granted under the Plan may, in the discretion of the Committee, be
granted to Eligible Persons either alone or in addition to, in tandem with, or
in exchange or substitution for, any other awards granted under any other plan
or agreement of the Company, any Subsidiary or Affiliate, or any business entity
to be acquired by the Company or a Subsidiary or Affiliate, or any other right
of an Eligible Person to receive payment from the Company or any Subsidiary or
Affiliate.

                  (b) TERM OF OPTIONS. The term of each Option granted to an
Eligible Person shall be for such period as may be determined by the Committee;
PROVIDED, HOWEVER, that in no event shall the term of any Option exceed a period
of ten years from the date of its grant (or such shorter period as may be
applicable under Section 422 of the Code).

                  (c) FORM OF PAYMENT UNDER OPTIONS. Subject to the terms of the
Plan and any applicable Option Agreement, payments to be made by the Company or
a Subsidiary or Affiliate upon the grant, maturation, or exercise of an Option
may be made in such forms as the Committee shall determine at the date of grant
or thereafter, including, without limitation, cash, Shares, notes or other
property, and may be made in a single payment or transfer, in installments, or
on a deferred basis.

                  (d) NONTRANSFERABILITY. Unless otherwise set forth by the
Committee in an Option Agreement, Options shall not be transferable by an
Eligible Person except by will or the laws of descent and distribution (except
pursuant to a Beneficiary designation) and shall be exercisable during the
lifetime of an Eligible Person only by such Eligible Person or his guardian or
legal representative. An Eligible Person's rights under the Plan may not be
pledged, mortgaged, hypothecated, or otherwise encumbered, and shall not be
subject to claims of the Eligible Person's creditors.

                  (e) NONCOMPETITION. The Committee may, by way of the Option
Agreements or otherwise, establish such other terms, conditions, restrictions
and/or limitations, if any, of any Option, provided they are not inconsistent
with the Plan, including, without limitation, the requirement that the
Participant not engage in competition with the Company.


                                      -8-


                  7. GENERAL PROVISIONS.

                  (a) COMPLIANCE WITH LEGAL AND TRADING REQUIREMENTS. The Plan,
the granting and exercising of Options thereunder, and the other obligations of
the Company under the Plan and any Option Agreement, shall be subject to all
applicable federal, state and foreign laws, rules and regulations, and to such
approvals by any stock exchange, regulatory or governmental agency as may be
required. The Company, in its discretion, may postpone the issuance or delivery
of Shares under any Option until completion of such stock exchange or market
system listing or registration or qualification of such Shares or other required
action under any state, federal or foreign law, rule or regulation as the
Company may consider appropriate, and may require any Participant to make such
representations and furnish such information as it may consider appropriate in
connection with the issuance or delivery of Shares in compliance with applicable
laws, rules and regulations. No provisions of the Plan shall be interpreted or
construed to obligate the Company to register any Shares under federal, state or
foreign law. The Shares issued under the Plan may be subject to such other
restrictions on transfer as determined by the Committee.

                  (b) NO RIGHT TO CONTINUED EMPLOYMENT OR SERVICE. Neither the
Plan nor any action taken thereunder shall be construed as giving any employee
the right to be retained in the employ or service of the Company or any of its
Subsidiaries or Affiliates, nor shall it interfere in any way with the right of
the Company or any of its Subsidiaries or Affiliates to terminate any employee's
employment or service at any time.

                  (c) TAXES. The Company or any Subsidiary or Affiliate is
authorized to withhold from any Option exercised, amounts of withholding and
other taxes due in connection therewith, and to take such other action as the
Committee may deem advisable to enable the Company and Eligible Persons to
satisfy obligations for the payment of withholding taxes and other tax
obligations relating to any Option. This authority shall include authority to
withhold or receive Shares or other property and to make cash payments in
respect thereof in satisfaction of an Eligible Person's tax obligations.

                  (d) CHANGES TO THE PLAN AND OPTIONS. The Board may amend,
alter, suspend, discontinue, or terminate the Plan or the Committee's authority
to grant Options under the Plan without the consent of shareholders of the
Company or Participants, except that any such amendment or alteration as it
applies to ISOs shall be subject to the approval of the Company's shareholders
to the extent such shareholder approval is required under Section 422 of the
Code and any such amendment or alteration shall be subject to the approval of
the Company's shareholders to the extent such approval is required under the
rules of any stock exchange or automated quotation system on which the Shares
may then be listed or quoted; PROVIDED, HOWEVER, that, without the consent of an
affected Participant, no amendment, alteration, suspension, discontinuation, or
termination of the Plan may materially and adversely affect the rights of such
Participant under any Option theretofore granted to him or her. The Committee
may waive any conditions or rights under, amend any terms of, or amend, alter,
suspend, discontinue or terminate, any Option theretofore granted, prospectively
or retrospectively; PROVIDED, HOWEVER, that, without the consent of a
Participant, no amendment, alteration, suspension, discontinuation or
termination of any Option may materially and adversely affect the rights of such
Participant under any Option theretofore granted to him or her.


                                      -9-


                  (e) NO RIGHTS TO OPTIONS; NO SHAREHOLDER RIGHTS. No Eligible
Person or employee shall have any claim to be granted any Options under the
Plan, and there is no obligation for uniformity of treatment of Eligible Persons
and employees. No Option shall confer on any Eligible Person any of the rights
of a shareholder of the Company unless and until Shares are duly issued or
transferred to the Eligible Person in accordance with the terms of the Option.

                  (f) UNFUNDED STATUS OF OPTIONS. The Plan is intended to
constitute an "unfunded" plan for incentive compensation. With respect to any
payments not yet made to a Participant pursuant to an Option , nothing contained
in the Plan or any Option shall give any such Participant any rights that are
greater than those of a general creditor of the Company; PROVIDED, HOWEVER, that
the Committee may authorize the creation of trusts or make other arrangements to
meet the Company's obligations under the Plan to deliver Shares pursuant to any
Option, which trusts or other arrangements shall be consistent with the
"unfunded" status of the Plan unless the Committee otherwise determines with the
consent of each affected Participant.

                  (g) NONEXCLUSIVITY OF THE PLAN. Neither the adoption of the
Plan by the Board nor its submission to the shareholders of the Company for
approval, as applicable, shall be construed as creating any limitations on the
power of the Board to adopt such other incentive arrangements as it may deem
desirable, including, without limitation, the granting of options and other
awards otherwise than under the Plan, and such arrangements may be either
applicable generally or only in specific cases.

                  (h) NOT COMPENSATION FOR BENEFIT PLANS. No Option payable
under this Plan shall be deemed salary or compensation for the purpose of
computing benefits under any benefit plan or other arrangement of the Company
for the benefit of its employees unless the Company shall determine otherwise.

                  (i) NO FRACTIONAL SHARES. No fractional Shares shall be issued
or delivered pursuant to the Plan or any Option. The Committee shall determine
whether cash, other Options, or other property shall be issued or paid in lieu
of such fractional Shares or whether such fractional Shares or any rights
thereto shall be forfeited or otherwise eliminated.

                  (j) GOVERNING LAW. The validity, construction, and effect of
the Plan, any rules and regulations relating to the Plan, and any Option
Agreement shall be determined in


                                      -10-


accordance with the laws of New York without giving effect to principles of
conflict of laws thereof.

                  (k) EFFECTIVE DATE; PLAN TERMINATION. The Plan shall become
effective as of the Effective Date. The Plan shall terminate as to future awards
on the date which is ten (10) years after the Effective Date.

                  (l) TITLES AND HEADINGS. The titles and headings of the
sections in the Plan are for convenience of reference only. In the event of any
conflict, the text of the Plan, rather than such titles or headings, shall
control.

EX-21.1.1

                                                                  EXHIBIT 21.1.1

                                  SUBSIDIARIES




                                                                         Jurisdiction of          Percentage of
                         Name of Subsidiary                                Organization             Ownership
                         ------------------                              ----------------         --------------
                                                                                               
Owned by Atlas Air Worldwide Holdings, Inc.
- -------------------------------------------
Atlas Air, Inc.                                                              Delaware                  100%
Airline Acquisition Corp I                                                   Delaware                  100%
Atlas Worldwide Aviation Logistics, Inc.                                     Florida                   100%

Owned by Atlas Air, Inc.
- ------------------------
Genessee Insurance Company, Ltd.                                             Bermuda                   100%
Atlas Air Crew Services, Ltd.                                                   UK                     100%
Liege Global Cargo Sales Co.                                                 Belgium                   86%
Atlas Freighter Leasing II, Inc.                                             Delaware                  100%

Owned by Atlas Freighter Leasing II, Inc.
- -----------------------------------------
Atlas Freighter Leasing III, Inc.                                            Delaware                  80%*

Owned by Airline Acquisition Corp I
- -----------------------------------
Polar Air Cargo, Inc.                                                       California                 100%


*    The remaining 20% of Atlas Freighter Leasing III, Inc. is owned by Atlas
     Air, Inc.

EX-24.1

                                                                    EXHIBIT 24.1

                                POWER OF ATTORNEY


         KNOWN ALL MEN BY THESE PRESENTS, that each of the undersigned, being a
director or officer of Atlas Air Worldwide Holdings, Inc., a Delaware
corporation (the "Company"), hereby constitutes and appoints Jeffrey H.
Erickson, Michael L. Barna and John W. Dietrich, and each of them, his true and
lawful attorney-in-fact and agent, with full power substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2004, and any and all amendments thereto, and to file the
same, with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done so
that such Annual Report on Form 10-K shall comply with the Securities Exchange
Act of 1934, as amended , and the applicable Rules and Regulations adopted or
issued pursuant thereto, as fully and to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them or their substitute or
resubstitute, may lawfully do or cause to be done by virtue hereof.

         IN WITNESS WHEREOF, each of the undersigned has hereunto set his or her
hand this 21st day of June, 2005.



/s/ EUGENE I. DAVIS
- ----------------------------------------------
Eugene I. Davis, Chairman of the Board



/s/ JEFFREY H. ERICKSON
- ----------------------------------------------
Jeffrey H. Erickson, President, Chief Executive
Officer and Director (Principal Executive
Officer)



/s/ MICHAEL L. BARNA
- ----------------------------------------------
Michael L. Barna, Senior Vice President and
Chief Financial Officer (Principal Financial
Officer)






/s/ G. L. HUTCHINSON
- ----------------------------------------------
Gordon L. Hutchinson, Vice President and
Controller (Principal Accounting Officer)



/s/ R. F. AGNEW
- ----------------------------------------------
Robert F. Agnew, Director



/s/ KEITH E. BUTLER
- ----------------------------------------------
Keith E. Butler, Director



/s/ DUNCAN H. COCROFT
- ----------------------------------------------
Duncan H. Cocroft, Director



/s/ JAMES S. GILMORE
- ----------------------------------------------
James S. Gilmore III, Director



/s/ RONALD L. KERBER
- ----------------------------------------------
Ronald L. Kerber, Director



/s/ HERBERT J. LANESE
- ----------------------------------------------
Herbert J. Lanese, Director



/s/ FREDERICK MCCORKLE
- ----------------------------------------------
Frederick McCorkle, Director

EX-31.1

Exhibit 31.1

Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer

          I, Jeffrey H. Erickson, President and Chief Executive Officer of Atlas Air Worldwide Holdings, Inc., certify that:

1.	I have reviewed this Annual Report on Form 10-K of Atlas Air Worldwide Holdings, Inc.;
2.	Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;
3.	Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and
	(c)	Disclosed in this Report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	/s/ Jeffery H. Erickson
	Jeffrey H. Erickson
	President and Chief Executive Officer
Dated June 30, 2005

EX-31.2

Exhibit 31.2

Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer

          I, Michael L. Barna, Senior Vice President and Chief Financial Officer of Atlas Air Worldwide Holdings, Inc., certify that:

1.	I have reviewed this Annual Report on Form 10-K of Atlas Air Worldwide Holdings, Inc.;
2.	Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;
3.	Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;
	(b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and
	(c)	Disclosed in this Report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	/s/ Michael L. Barna
	Michael L. Barna
	Senior Vice President and Chief Financial Officer
Dated June 30, 2005

EX-32.1

Exhibit 32.1

Section 1350 Certification
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

          Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned officers of Atlas Air Worldwide Holdings, Inc. (the “Company”) does hereby certify, to such officer’s knowledge, that:

          The Annual Report on Form 10-K for the fiscal year ended December 31, 2004 (the “Form 10-K”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: June 30, 2005

/s/ Jeffrey H. Erickson

Jeffrey H. Erickson

President and Chief Executive Officer

/s/ Michael L. Barna

Michael L. Barna

Senior Vice President and Chief Financial Officer