Air Transport Services Group

Company Profile

The timing of these postings are made at the discretion of Air Transport Services Group (ATSG). Readers should not assume that the information contained on this site has been updated or otherwise contains current information. ATSG does not review past postings to determine whether they remain accurate, and information contained in such postings may have been superseded.

ATSG is a leading provider of air cargo transportation and related services.

Air Transport Services Group is a leading provider of aircraft leasing and air cargo transportation and related services to domestic and foreign air carriers and other companies that outsource their air cargo lift requirements. ATSG, through its leasing and airline subsidiaries, is the world's largest owner and operator of converted Boeing 767 freighter aircraft.

Through its principal subsidiaries, including three airlines with separate and distinct U.S. FAA Part 121 Air Carrier certificates, ATSG provides aircraft leasing, air cargo lift, passenger ACMI and charter services, aircraft maintenance services and airport ground services. ATSG's subsidiaries include ABX Air, Inc.; Airborne Global Solutions, Inc.; Airborne Maintenance and Engineering Services, Inc., including its subsidiary, Pemco World Air Services, Inc.; Air Transport International, Inc.; Cargo Aircraft Management, Inc.; and Omni Air International, LLC.

MESSAGE FROM THE CEO

In 2018, we completed several important initiatives that substantially advance our business goals around customer diversification, an assured supply of additional aircraft assets, and stable customer relationships for long-term growth. While achieving those goals, we produced another year of strong financial results and laid the groundwork for even better years ahead. The first initiative I mentioned – diversifying our customer base – has been a major objective ever since our spin-off from the DHL/Airborne merger 15 years ago, when we were dependent on a single contract for nearly all of our revenue. Back then, we charted a course that would lead us into new markets by leveraging our airline roots while emphasizing our dedicated-aircraft model. Today, DHL is one of three principal ATSG customers, along with many others that are important sources of our revenues.

Our November acquisition of Omni Air International was a major step forward in that diversification. Omni brought us a thirteenaircraft fleet of Boeing 767 and Boeing 777 passenger aircraft, and a leading role in providing efficient passenger movement for our nation’s armed forces. Our primary focus when deciding among capital allocation alternatives is to select those that create value by generating strong sustainable cash flows. This is why we invest in the Boeing 767 freighter aircraft, which are preferred by the operators of e-commerce-driven regional air networks worldwide. But sourcing, converting, and deploying significant numbers of aircraft can be a lengthy process. Our acquisition of Omni jumpstarts the realization of strong sustainable cash flow benefits. To generate a similar scale of cash flow contribution would have otherwise required incremental 767 fleet growth of more than 30 aircraft and several years to fully implement. Omni’s additional public sector revenues also further immunize us against volatility in the broad economy.

Omni’s focus on the government market and ACMI passenger service isn’t entirely new territory for ATSG. Our Air Transport International subsidiary has been the U.S. military’s sole source of mixed passenger/cargo “combi” airlift for decades. Through both ATI and our ABX Air airline, we have partnered with Omni Air on one of two teams of commercial airlines that compete to supplement the Defense Department’s own passenger and cargo fleets. In that role, Omni Air is the U.S. Defense Department’s go-to supplemental passenger carrier, due in part to its go-anywhere, anytime flexibility and reliability.

Our second initiative was to secure access to high-quality Boeing 767 passenger aircraft we could either convert into freighters or continue to operate in passenger configuration with Omni Air, as the 767 platform remains in strong demand in both markets. In a very competitive process, we bid for and won the rights to acquire twenty 767s that will be retired from American Airlines over the next three years. Those twenty, along with five 767s we bought last year that were still undergoing conversion at year end, preserve our position as the world’s largest leasing source of the preferred aircraft type among customers seeking medium widebody freighters.

Extending our leasing and CMI relationships with DHL and Amazon, our blue chip commercial customers, was our third major initiative last year.

In December, we completed agreements with Amazon that collectively added 48 years of additional 767 dry lease revenue, as lease durations for twelve of the existing twenty 767 aircraft we provide to them were extended for two years and the remaining eight aircraft leases were extended for three years. Also, we agreed to lease 10 more 767s to them for 10-year terms, with deliveries of five each during the second half of 2019 and 2020. The agreements include provisions for Amazon to acquire warrants for the purchase of up to 33.2 percent of ATSG shares, and warrant incentives for Amazon to lease up to 17 additional aircraft, beyond the 30 already committed to be under lease by the end of 2020.

As this report went to press, we were winding up the final details of another multi-year extension of our 15-year relationship with DHL for lease extensions for fourteen 767s currently deployed in North America and the Middle East, and the agreement that covers those we operate in their domestic network. We look forward to many more years of comprehensive aircraft, crew and maintenance service for DHL as a primary source of its airlift.

The key to extending relationships with long-time customers is to consistently deliver high quality service. Toward that end, our airline subsidiaries invest in and maintain focus on providing customers with reliable on-time performance.

Some of the benefits of our 2018 investments and new customer arrangements will accrue over time. But our Omni Air acquisition had an immediate positive effect on our 2018 results and will generate a substantial portion of our revenue and cash-flow growth in 2019.

Under Generally Accepted Accounting Principles, or GAAP, our revenues were $892.3 million for 2018, versus $1.1 billion in 2017. The revenue was impacted by new GAAP recognition rules that we adopted, including one under which costs directly reimbursed to us and controlled by our customers are now reported net of the corresponding expenses. If not for that change, our 2018 revenues would have increased 15 percent instead of declining.

We reported earnings of $67.9 million, or 89 cents per share diluted in 2018. That compares with $21.7 million, or 36 cents per share in 2017. Our operating results overall were strong, as evidenced by a 27 percent increase in Operating Cash Flow. But accounting-rule changes and non-cash gains and losses had a major effect on our revenues and earnings for 2018 as reported under GAAP.

The largest year-over-year changes in our GAAP earnings reflected the continuing gains and losses from revaluation of unexercised warrants we began issuing to Amazon in 2016, and a 2017 gain reflecting the effect of the 2017 tax law changes on our deferred tax assets. We reported a $7.1 million gain after tax on those warrant revaluations in 2018, versus a $77.5 million loss in 2017. The tax-law changes yielded a $59.9 million non-recurring net gain in 2017.

Our improved 2018 operating results stemmed primarily from continued growth in cargo aircraft deployments, and improved results from our airline businesses.

In 2018, we deployed ten newly converted freighter aircraft to customers, including nine Boeing 767s and one Boeing 737, just as we did in 2017. Seven of those 767s leased in 2018, plus the 737, were leased to external customers. Our leasing entity, CAM, also assumed ownership of eleven of Omni Air’s passenger aircraft, which are leased back to Omni for its military-focused ACMI or charter operations.

Our airline businesses had sharply higher revenues and profits, due in part to a full year of operation for all 20 aircraft we fly for Amazon, plus fourth-quarter contributions from Omni Air. In March 2018, the unionized pilots of Air Transport International represented by the Air Line Pilots Association and the flight attendants represented by the Association of Flight Attendants-CWA ratified amendments to their collective bargaining agreements with ATI. Together with recent multi-year labor agreement extensions covering pilots and flight attendants at Omni Air, approximately 79 percent of crew members across our airlines are now covered under labor agreements with two or more years to run before becoming amendable.

We are off to another great start in 2019. We are projecting $400 million in capital expenditures, mainly to acquire, convert and lease more 767s to customers, and support the maintenance requirements of our expanded fleet. The eight to ten additional 767s we expect to deploy this year include five freighters we will lease to Amazon, plus three we expect to lease to a major global integrator, nearly all of which will occur in the second half of the year. Five of those 2019 deployments will be from feedstock 767-300s we acquired in 2018.

Our balance sheet remains strong, even as we increased our borrowings to fund the Omni Air purchase and acquire additional growth assets. Approximately 50 percent of our debt is effectively at a fixed interest rate, our borrowing cost remains relatively low, and we have ample access to capital to continue to grow at an attractive return profile. We expect our increased operating cash flow to keep our debt-to- EBITDA ratio, as computed by our banks, at or close to 3.5 times.

Three strong market forces will be at our backs this year, helping drive our results as we execute our plans. You can sum those forces up in one word: Speed.

• One of these forces is the competitive battleground in retailing, where online e-commerce competitors are using more airlift to capture share by augmenting low prices with promises of faster delivery.

• Another is the speed of fresh investment in end-to-end control of supply chains that serve both online and fixed retailers, along with other commercial entities. Those new and upgraded supply chains often require dedicated cargo aircraft as part of the mix.

• And a third is the U.S. military’s continued reliance on efficient commercial air movement of its personnel around the globe, coupled with the overall growth in military spending in the 2019 and proposed 2020 federal budgets.

Our goal is to grow and become more profitable by remaining the No. 1 source of dedicated midsize cargo and passenger aircraft that are essential elements of those commercial and military networks. Keeping that edge will require continued focus on reliable on-time service by our airlines, and a mix of available aircraft types, including the three Boeing 777s that we added via Omni Air.

While converted 767 freighters will remain our investment focus this year, we are already beginning to support programs to convert other aircraft types as the pipeline of conversion-ready 767s begins to narrow. Our joint venture with Precision is targeting certification of a converted freighter variant of the Airbus A321 airframe early next year. Like the Boeing 767, the Airbus A321 has proven its reliability and efficiency as an integral part of many passenger airline fleets for 25 years. As a cargo aircraft operating within regional networks alongside our larger 767s, the A321 is a compelling option for our customers because its cubic capacity rivals the midsize Boeing 757, but its operating costs are more in line with smaller Boeing 737s.

Our role as your leadership team is to make sure ATSG’s operating units have the people and assets they need to serve our existing customers well, and to redeploy the substantial cash flows they generate toward growth opportunities consistent with our return on capital objectives. Our emphasis in 2019 will be on execution and achieving the benefits we envisioned from the significant strategic initiatives we completed in 2018.

ATSG BOARD OF DIRECTORS

Randy D. Rademacher Sr. Vice President and Chief Financial Officer for Reading Rock, Inc. Rademacher has served as the Chief Financial Officer for Reading Rock, Inc., a privately owned manufacturer and distributor of concrete products and other building materials, since 2008. Rademacher was formerly the Chief Financial Officer for The Armor Group, a privately owned manufacturer of industrial and commercial products, from 2006 to 2008. Rademacher was the President of Dynus Corporation, a privately owned telecommunications company, from June 2005 to October 2005, and the President of Comair Holdings LLC, from 1999 to 2005. During his career at Comair Holdings LLC, Rademacher held a number of positions, including Senior Vice President and Chief Financial Officer from 1993 to 1999, Vice President of Finance from 1989 to 1993, Controller from 1986 to 1989, and Director of Corporate Finance from 1985 to 1986. Prior to that, Rademacher was a CPA for Arthur Andersen & Co. from 1979 to 1985. Mr. Rademacher has been a Director of the Company since December 2006 and Chairman of the Board since May 2015. He is a member of both the Audit Committee and the Nominating and Governance Committee.

Richard M. Baudouin Senior Advisor for Infinity Transportation Baudouin is Senior Advisor for Infinity Transportation, a company owned by Global Atlantic Financial Corp., since 2016. Prior to his current role at Infinity Transportation, Mr. Baudouin was a principal of Infinity Aviation Capital, LLC, an investment firm involved in aircraft leasing, from 2011 to 2016, and was a co-founder and former managing director of Aviation Capital Group, a commercial aircraft leasing company, from 1989 to 2010. ACG was acquired by Pacific Life Insurance Co. in 2005, and is now one of the world’s largest aircraft leasing companies, with more than 260 Airbus and Boeing passenger and freighter aircraft, leased to approximately 90 airlines in 40 countries. Mr. Baudouin has been a Director of the Company since January 2013. He is the Chairman of the Nominating and Governance Committee and is a member of the Audit Committee.

Robert K. Coretz Principal of 10 Tanker Air Carrier Coretz has over 25 years of experience in the aviation industry. He is a principal and founder of 10 Tanker Air Carrier, which engineers and modifies DC-10 aircraft for aerial firefighting and suppression purposes. He also is the founder and former chairman of Omni Air International, a U.S. based passenger airline acquired by ATSG in November 2018, as well as Omni Aviation Leasing and T7 Aircraft Leasing. Mr. Coretz has been a Director of the Company since February 2019.

Joseph C. Hete Chief Executive Officer of ATSG, Inc. Hete has been Chief Executive Officer of ATSG, Inc., since September 2007 and Chief Executive Officer of ABX Air, Inc. since August 2003, and was President of ATSG, Inc. from September 2007 to September 2019. He was the President of ABX Air, Inc., from January 2000 to February 2008 and the Chief Operating Officer of ABX Air, Inc. from January 2000 to August 2003. From 1997 until January 2000, he held the position of Senior Vice President and Chief Operating Officer of ABX Air, Inc. Hete served as Senior Vice President, Administration, of ABX Air, Inc. from 1991 to 1997, and Vice President, Administration, of ABX Air, Inc. from 1986 to 1991. Mr. Hete has been with the company since 1980.

Raymond E. Johns, Jr. Executive Vice President of FlightSafety International Inc. Johns has been Executive Vice President of FlightSafety International Inc., a global provider of flight training for commercial, business and military aviation professionals and flight simulation equipment, since 2014. Prior to his retirement from the military, Mr. Johns led the U.S. Air Force Air Mobility Command at Scott Air Force Base in Illinois. He retired with the rank of General in January 2013, capping a 36-year military career. Mr. Johns has been a Director of the Company since October 2017. He is a member of both the Audit Committee and Nominating and Governance Committee.

Laura Peterson Vice President of The Boeing Company Peterson has 22 years of experience in the global aerospace industry at The Boeing Company, where she held a series of executive positions in aircraft sales, international business development, global strategy, government relations and homeland security. Her most recent role was Vice President, China Business Development for Boeing Commercial Airplanes, where she was responsible for Boeing’s largest commercial market. She is an incoming 2018-2019 Fellow of the Stanford Distinguished Careers Institute. Ms. Peterson has been a Director of the Company since June 2018.

J. Christopher Teets Partner of Red Mountain Capital Partners LLC Teets has served as a Partner of Red Mountain Capital Partners LLC, an investment management firm, since February 2005. Before joining Red Mountain Capital Partners LLC, Teets was an investment banker at Goldman, Sachs & Co. Teets joined Goldman, Sachs & Co. in 2000. Prior to Goldman Sachs, Teets worked in the investment banking division of Citigroup. Teets has served as a director of Encore Capital Group, Inc. since May 2007 and as a director of Marlin Business Services Corp. since May 2010, and previously served as a director of Affirmative Insurance Holdings, Inc. Mr. Teets has been a Director of the Company since February 2009. He is the Chairman of the Compensation Committee and a member of the Nominating and Governance Committee.

Jeffrey J. Vorholt Independent consultant and private investor Vorholt was most recently a full-time faculty member at Miami University (Ohio) and concurrently an Adjunct Professor of Accountancy at Xavier University (Ohio), from 2001 to 2006. Vorholt, a CPA and attorney, was the Chief Financial Officer of Structural Dynamics Research Corporation from 1994 until its acquisition by EDS in 2001. Previously, he served as the Senior Vice President of Accounting and Information Systems for Cincinnati Bell Telephone Company and the Senior Vice President, Chief Financial Officer and Director for Cincinnati Bell Information Systems, which is now Convergys Corporation. Vorholt is currently a Director and the Chairman of the Audit Committee for Softbrands, Inc., a global provider of enterprise-wide application software. Mr. Vorholt has been a Director of the Company since January 2004. He is the Chairman of the Audit Committee and is a member of the Compensation Committee.

Joe Hete Chief Executive Officer Joseph C. Hete has been the chief executive officer of Air Transport Services Group, Inc. (ATSG) since December 2007, and he served as president from December 2007 to September 2019. He is responsible for establishing the strategic planning for all the entities under the ATSG umbrella.

Hete joined ABX Air as an Accounting Manager in September of 1980 and held positions as Treasurer, Director of Strategic Planning, and Director of Administration from 1981 to 1985. He was promoted to Senior Director of Administration in 1985, to Vice President of Administration in 1986 and to Senior Vice President of Administration in 1991. In early 1997, he was named Chief Operating Officer, and he was named President and COO in December of 1999. He became CEO in August of 2003. In December 2007, Air Transport Services Group, Inc. (ATSG) was formed from the reorganization of ABX Air for the purpose of creating a holding company structure; Hete was name chief executive officer and president. On December 31, 2007, ATSG completed the acquisition of Cargo Holdings International. Prior to ABX Air, he held positions as General Accounting Supervisor and Staff Accountant at Anderson IBEC from 1977 to 1980.

Hete earned his Bachelor of Science degree in Accounting from the University of Akron.

Rich Corrado President Richard F. Corrado has been the President of ATSG since September 2019 and is responsible for goal-setting and oversight of all ATSG businesses.

Corrado joined ATSG as Chief Commercial Officer in April 2010 and was elected Chief Operating Officer in September 2017. Prior to joining ATSG, Corrado held leadership positions in the consulting and air express industry. He served as President of Transform Consulting Group (2006-2010). He served at DHL Express, as the Executive Vice President of Air Products & Services (2004-2006) and Executive Vice President of Business Development (2003-2004) after the DHL acquisition of Airborne Express. He was the only former Airborne executive named to the DHL US Management Board. At Airborne Express he held several positions over a 17 year period, most notably Senior Vice President of Marketing (2000-2003), and Vice President, Administration for ABX Air (1999-2000). Corrado also held the position of Senior Manager at Ernst & Young, LLP.

Corrado earned his Bachelor of Arts degree in Economics cum laude from Harvard University, and an MBA from Boston College.

Ed Koharik Chief Operating Officer Edward J. Koharik III was named Chief Operating Officer for ATSG in September 2019. He is responsible for all aspects of the day-to-day operations of ATSG's airlines, maintenance, and service businesses. Additionally, he is also President of ATSG subsidiary Cargo Aircraft Management, ATSG’s aircraft leasing company.

Prior to joining ATSG, Koharik was most recently senior vice president of FlightSafety International in New York City. Earlier, he was a director at the U.S. Transportation Command, working with more than 400 commercial providers of transportation services to supplement the federal government’s own transport resources.

Koharik graduated from the United States Air Force Academy with a Bachelor of Science degree in Aeronautical Engineering. He also holds a Master’s degree in Computer Resources and Information Management from Webster University and a Master’s in Military Operational Art and Science from Air University at Maxwell Air Force Base in Alabama.

Quint Turner Chief Financial Officer Quint O. Turner is Chief Financial Officer of Air Transport Services Group, Inc. Turner is responsible for the company's finances, financial planning, financial risk management, record-keeping, and financial reporting.

Turner has held the role of Chief Financial Officer for the company since 2004. His prior roles with ABX Air included Vice President of Administration, Corporate Director of Financial Planning and Accounting, Director of Financial Planning, and Manager of Planning. Turner joined ABX Air in 1988 as a Staff Auditor. Prior to joining the company, he was an Auditor for Touche Ross & Co.

Turner is a Certified Public Accountant and earned a Bachelor of Science degree from Miami University (Ohio).

Joe Payne Chief Legal Officer and Secretary W. Joseph Payne is the Chief Legal Officer and Secretary for ATSG. Payne is responsible for directing the Company’s legal and regulatory affairs, as well as overseeing corporate compliance, governance and security matters. He advises the Board of Directors and senior management on a variety of legal issues, including with respect to the development and implementation of strategic initiatives, business transactions, corporate governance and compliance matters, and litigation. Payne also retains and oversees the work of outside counsel.

Payne joined ABX Air as a Contract Manager in April 1995 and held positions as Assistant Corporate Secretary and Corporate Secretary/Counsel from July 1996 to January 2004. He was promoted to Vice President, General Counsel and Secretary of ABX Air in January 2004. In December 2007, ATSG was formed from the reorganization of ABX Air for the purpose of creating a holding company structure and Payne was named Senior Vice President, Corporate General Counsel and Secretary of ATSG. In May 2016, he was named Chief Legal Officer and Secretary.

Prior to joining ABX Air, Payne practiced law in the greater Cincinnati area from 1992 to 1995 and worked as an accountant for Hook-SuperX Drugs from 1987 to 1989, prior to attending law school.

Payne earned a Juris Doctor from the University of Dayton School of Law, and a Bachelor of Business Administration from the University of Cincinnati College of Business Administration, where he majored in accounting.

Mike Berger

Mike Berger Chief Commercial Officer Mike Berger is the Chief Commercial Officer for ATSG. He is responsible for all aspects of the global commercial marketing strategy, including marketing, direct sales, advertising, external communications, brand strategy, service/product development and portfolio marketing. Additionally, he is also President of ATSG subsidiary Airborne Global Solutions, ATSG’s consulting and marketing subsidiary responsible for selling the bundled solutions of the ATSG portfolio of companies.

Berger joined ATSG in February 2018. Berger's most recent role prior to joining ATSG was Chief Commercial Officer for Dicom Transportation Group of Canada. Prior to that he held senior management positions in major air express companies including TNT Europe, DHL, and Airborne Express. He holds a bachelors degree in business management and marketing from Temple University.

Matt Fedders Vice President, Corporate Controller Mr. Fedders was promoted to Vice President in May 2013. He has been Corporate Controller since June 2008. Prior to this he held the role of Director, Financial Reporting/Controller for ABX Air, Inc. since joining the company in October 2003.

Russ Smethwick Vice President, Corporate Development Mr. Smethwick was promoted to Vice President in March 2017. He has been Director of Strategic Planning since 2007. Prior to joining ATSG, Russ led the M&A program for FirstGroup PLC's North American services division. He also has worked in commercial banking for Provident Bank, Fifth Third, and National Bank of Canada. He holds a bachelor's degree in accounting from Ohio University, a master's degree in business administration from Xavier University, and is a Certified Public Accountant (CPA).

Sarah Williams Vice President, Taxation Ms. Williams was promoted to Vice President in March 2018. She joined the company in 2007, serving first as Manager of Taxation and later Director of Taxation. She is a CPA with 18 years of public accounting experience serving as outsourced tax director for a variety of publicly traded companies and large privately held companies. She holds a Masters of Tax from Capital Law School and a Bachelors of Business-Accounting from Western Michigan University.

ATSG BOARD COMMITTEES

Air Transport Services Group (ATSG) is committed to strong corporate governance practices. The Board of Directors has a standing Audit Committee, Compensation Committee, and Nominating and Governance Committee. Each committee consists exclusively of non-employee directors.

In addition, ATSG has adopted the following policies and guidelines:

  • A Code of Ethics that sets forth the policies and business practices that apply to the Company's Chief Executive Officer, Chief Financial Officer, and Vice President of Administration.
  • Corporate Governance Guidelines that help the Board of Directors oversee the work of management in the conduct of the Company’s business and seek to serve the long-term interests of stockholders.
  • A Code of Conduct for Conducting Business that set forth the policies and business practices that apply to all of the Company’s employees.
  • A Corporate Compliance Plan to implement a program that promotes an organizational culture that encourages ethical conduct and a commitment to compliance. This plan incorporates immigration compliance.
  • An Insider Trading Policy that applies to the Company's directors, officers and employees, their family members, and specially designated outsiders who have access to the Company's material nonpublic information.

Audit Committee

The Audit Committee is generally charged with the appointment, compensation, retention, evaluation, and oversight of the work of the independent auditors; reviewing and discussing with management and the independent auditors the Company’s annual audited and quarterly financial statements; reviewing the internal audit function; overseeing the integrity, adequacy and effectiveness of the Company’s internal accounting and financial controls; and approving and monitoring the Company’s compliance with its codes of conduct.

Compensation Committee

The Compensation Committee is generally charged with reviewing, evaluating and making recommendations to the full Board with respect to the Company’s overall compensation policies, including bonuses and benefits; reviewing, evaluating and making recommendations to the full Board on matters relating to the CEO’s compensation; considering and approving the selection, retention and remuneration arrangements for other executive officers; reviewing and evaluating performance target goals for non-executive senior officers and employees; and establishing and reviewing the compensation for non-employee directors.

Nominating and Governance Committee

The Nominating and Governance Committee is generally charged with identifying individuals qualified to become members of the Board in accordance with the criteria approved by the Board; making recommendations to the full Board with respect to director nominees for each annual meeting of the stockholders; developing and recommending to the Board a set of corporate governance principles applicable to the Company; and overseeing the evaluation of the Board and management.

Code of Ethics

The Code of Ethics sets forth the policies and business practices that apply to the Company’s Chief Executive Officer, Chief Financial Officer and Vice President, Administration. The Code of Ethics addresses such topics as compliance with laws; full, fair, accurate and timely disclosure of financial results; professional, honest and ethical conduct; conflicts of interest; reporting procedures and accountability.

Corporate Governance Guidelines

The Corporate Governance Guidelines help the Board of Directors fulfill its responsibility to stockholders to oversee the work of management in the conduct of the Company’s business and to seek to serve the long-term interests of stockholders. These Guidelines are intended to ensure that the Board has the necessary authority and practices in place to review and evaluate the Company’s business operations as needed and to make decisions that are independent of the Company’s management.

Code of Conduct for Conducting Business

The Code of Conduct for Conducting Business sets forth the policies and business practices that apply to all of the Company’s employees. The Code of Conduct addresses such topics as compliance with laws; moral and ethical conduct; equal employment opportunity; promoting a work environment free from harassment or discrimination; and the protection of intellectual property and proprietary information.

Corporate Compliance Plan

The Corporate Compliance Plan has been designed to govern the development and implementation of a corporate compliance program that promotes an organizational culture that encourages ethical conduct and a commitment to compliance. This plan also reflects the Company's commitment both to hiring personnel who are lawfully permitted to work in the United States and to contracting with temporary agencies that provide lawfully-documented workers.

Insider Trading Policy

The Insider Trading Policy sets forth the policies and practices for preventing improper insider trading or tipping. The Policy applies to the Company's directors, officers and employees, their family members, and specially designated outsiders who have access to the Company's material nonpublic information.

Investor Relations Contact Information

Air Transport Services Group, Inc.
Attn: Investor Relations
145 Hunter Drive
Wilmington, OH 45177