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 AAWW’s management employees and (vi) in the event of termination of the agreement by Atlas for reasons other than Cause (as defined in the Employment Agreement) or by Mr. Erickson for Good Reason (as defined in Employment 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 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, 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 options, which were granted in 2003, had previously been cancelled as a result of our emergence from bankruptcy and the cancellation of our Old Common Stock.

     As noted in the “Report of the Compensation Committee” above, Mr. Erickson’s Employment Agreement was terminated pursuant to a Retirement and General Release Agreement (the “Retirement Agreement”) dated January 29, 2006, subject to the survival of certain provisions of the Employment Agreement. Mr. Erickson’s retirement will become effective no later than six months from the date of the Retirement Agreement (the “Retirement Date”). Under the terms of the Retirement Agreement and in lieu of certain benefits Mr. Erickson would receive under the Employment Agreement, Mr. Erickson will have the right to receive retirement payments based on his base annual salary for a period of 18 months, commencing six months after the Retirement Date and a lump sum payment of $524,400 payable on the Retirement Date. Additionally, we will provide Mr. Erickson with his continued medical, dental and vision coverage during the 24 month period following the Retirement Date, provided that such benefits will not be continued if Mr. Erickson obtains comparable coverage in connection with subsequent employment. Mr. Erickson will be reimbursed for his attorney’s fees, up to a maximum of $30,000 incurred in connection with his retirement and negotiation of the Retirement Agreement, among other things. Mr. Erickson may also be eligible to receive a success fee with respect to future transactions which may be initiated during his tenure as Chief Executive Officer and which are consummated within one year of the Retirement Date; provided, however, that no more than two transactions may qualify for such payment, and those transactions shall be as agreed upon in advance between Mr. Erickson and the Board.

     On the Retirement Date, 58,733 restricted shares of Common Stock granted to Mr. Erickson, which have not previously vested and are scheduled to vest on July 27, 2006, will be immediately vested. Further, on such date, 42,233 options (at an exercise price of $16.70) which have not previously vested and would otherwise not vest until July 27, 2006 will be immediately vested. Additionally, 17,333 options (at an exercise price of $27.50) which have not previously vested and would otherwise not vest until January 23, 2007 will be immediately vested. These options and all previously vested options may be exercised up to the later of 90 days after the Retirement Date and December 31, 2006. Also, Mr. Erickson will be entitled to receive a bonus for 2006 equal to 50% of his base salary, without regard to whether he remains employed through the payment date, which shall be payable on the same date that bonuses for other executives are paid under the 2006 Annual Incentive Plan, but in any event not later than March 14, 2007.

     Ronald A. Lane. Mr. Lane’s employment agreement was entered into effective May 1, 2003. It was amended as of January 24, 2004 and April 20, 2004, respectively. 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 our 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

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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 us at least three months prior to such renewal or by Mr. Dietrich prior to such renewal. Mr. Dietrich’s initial title was Vice President of Legal and Acting General Counsel of Atlas and AAWW. He was subsequently named (x) Vice President of Legal and General Counsel of AAWW, Atlas and Polar on March 19, 2003 and (y) Senior Vice President, General Counsel and Chief Human Resources Officer of AAWW, Atlas and Polar on May 15, 2003. 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 our 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 AAWW 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 one-time cash payment of $19,000, and (v) the lump sum payable 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) 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.

     Michael L. Barna. Effective April 11, 2005, we entered into a term sheet with Mr. Barna governing the terms of his employment, which term sheet does not contain a fixed term of employment. His base salary is $300,000, subject to annual review, and he is entitled to receive (i) an annual incentive bonus at a target of 50% of his base salary based on our financial and Mr. Barna’s individual performance for each fiscal year during his employment, which we agreed not to pro rate for fiscal year 2005, (ii) other customary benefits available to our management employees and (iii) in the event of termination of Mr. Barna by Atlas for reasons other than Cause (as defined in the term sheet) or pursuant to a Change of Control (as defined in the agreement), a payment equal to 12 months of his then-base salary paid in accordance with our normal payroll schedule.

     William C. Bradley. Effective April 1, 2005, we entered into a letter agreement with Mr. Bradley, which terminated and replaced his previous employment agreement with Atlas entered into on July 8, 2002. The letter agreement does not specify a fixed term of employment. The letter agreement provides that Mr. Bradley is entitled to the benefits generally provided to Vice Presidents under our Benefit Program for Vice Presidents, which includes the right to receive severance payments in the event of Mr. Bradley’s termination without Cause (as defined in that agreement) in an amount equal to nine months of his then-base salary, payable on our regular payroll schedule, and participation in AAWW’s standard health benefit, 401(k) and vacation programs. In addition, under the letter agreement, Mr. Bradley’s base salary was increased to $252,000, in consideration of the elimination of his automobile allowance, and he is entitled to receive (i) a one-time cash payment of $19,000 in consideration of the elimination of the tax gross-up provided to him in connection with his automobile allowance, (ii) a one-time cash payment of $150,000 in consideration of the reduction in his severance eligibility from eighteen months to 9 months and (iii) a severance payment payable in the event he chooses to terminate his employment for Good Reason (as defined in the letter agreement) in an amount equal to 9 months of his then-base salary, payable on our regular payroll schedule.

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PROPOSAL 2

APPROVAL OF
ATLAS AIR WORLDWIDE HOLDINGS, INC.
2006 ANNUAL INCENTIVE PLAN FOR SENIOR EXECUTIVES
IN CONFORMANCE WITH
SECTION 162(m) OF THE INTERNAL REVENUE CODE

General

     We are asking stockholders to approve the 2006 Annual Incentive Plan. The 2005 Annual Incentive Plan, which was approved by stockholders at last year’s annual meeting, expired on December 31, 2005 in accordance with its terms, and no further awards will be made under the 2005 Annual Incentive Plan. The 2006 Annual Incentive Plan replaces the 2005 Annual Incentive Plan and provides, among other things, for the payment of incentive awards primarily in the form of cash and contains provisions that protect the Company’s ability to take a tax deduction for performance-based awards made under the 2006 Annual Incentive Plan, or under the Company’s 2004 LTIP, in conformance with Section 162(m) of the Code and related regulations, in case certain executive officers who are awardees individually have more than $1 million of compensation in any one year.

     Section 162(m) of the Code limits the deductibility of certain compensation in excess of $1 million per year paid to “covered employees,” defined as the Company’s Chief Executive Officer and its other four most highly-compensated executive officers. In accordance with Section 162(m) of the Code, if the 2006 Annual Incentive Plan is not approved, no awards would be made to the individuals listed in the preceding sentence. The 2006 Annual Incentive Plan is intended to address the limitation on deductibility by providing for compensation that qualifies as “performance-based compensation,” which is not subject to the limitation.

     Compensation paid under the 2006 Annual Incentive Plan, or under the 2004 LTIP as authorized by the 2006 Annual Incentive Plan, will qualify as “performance-based compensation” within the meaning of Section 162(m) if:

• it is payable on account of the attainment of the pre-established, objective performance goals and subject to the limitations on award amounts as set forth within the 2006 Annual Incentive Plan;
• the Compensation Committee of the Board, which is comprised solely of non-employee directors, approves the maximum individual awards at or near the beginning of each performance period;
• the 2006 Annual Incentive Plan, which sets forth the material terms of the compensation and the various performance goals, is disclosed to and approved by stockholders before payment; and
• the Compensation Committee certifies that the performance goals have been satisfied before payment.

     The Board believes that you should approve the new 2006 Annual Incentive Plan because it encourages eligible participants to increase their efforts to help make us more successful and to remain in our employ by providing them the opportunity to earn incentive payments upon the achievement of established performance goals.

Summary of the 2006 Annual Incentive Plan

     The following paragraphs provide a summary of the principal features of the 2006 Annual Incentive Plan. This summary does not purport to be complete and is subject to, and qualified in its entirety by, the provisions of the 2006 Annual Incentive Plan, which is set forth in Appendix C to this Proxy Statement.

Eligibility

     The 2006 Annual Incentive Plan’s participants include the Chief Executive Officer, President, Executive Vice Presidents and Senior Vice Presidents of the Company (currently five persons). All eligible employees will be eligible to participate in the 2006 Annual Incentive Plan if they are employed as eligible employees as of the first day of the plan year. An individual who becomes an eligible employee during a plan year will participate immediately, but only with respect to base salary earned on and after the date he or she first becomes an eligible employee, except as the Compensation Committee may determine in its sole discretion to allow exceptions (e.g., the consideration of base salary on an annualized basis).

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Administration

     The 2006 Annual Incentive Plan will be administered by the Compensation Committee.

Determination of Awards

     For each plan year, each participant will be entitled to receive a cash payment under the 2006 Annual Incentive Plan based upon the Company’s achievement of its financial goal. The Company meeting its financial goal is a prerequisite to any payment being made under the 2006 Annual Incentive Plan. The financial goal shall be established each year by the Compensation Committee and shall relate to one or more of the following performance measures:

	a)	Net earnings, net income or profits (before or after taxes);
	b)	Earnings per share (basic or diluted);
	c)	Net sales or revenue growth;
	d)	Net operating profit;
	e)	Return measures (including, but not limited to, return on assets, capital, invested capital, equity, sales, or revenue);
	f)	Cash flow (including, but not limited to, operating cash flow, free cash flow, cash flow return on equity, and cash flow return on investment);
	g)	Earnings before or after taxes, interest, depreciation, amortization and/or rent;
	h)	Gross or operating margins;
	i)	Productivity ratios;
	j)	Share price (including, but not limited to, growth measures and total shareholder return);
	k)	Expense targets;
	l)	Margins;
	m)	Operating efficiency;
	n)	Market share;
	o)	Working capital targets; and
	p)	Cost reduction targets.

     The Compensation Committee may, in its sole discretion, reduce the award otherwise payable to a participant as a result of the Company’s achievement of the established financial goal to reflect the participant’s individual performance, which will be measured against pre-determined objectives approved by the Compensation Committee, or to reflect other performance goals established by the Compensation Committee.

     Participants other than the Chief Executive Officer have a maximum bonus opportunity of 100% of annual base salary earned in the plan year. For the Chief Executive Officer the maximum bonus opportunity is 160% of base annual salary earned in the plan year.

     The 2006 Annual Incentive Plan also allows awards of performance based restricted stock or stock options to be made under the 2004 LTIP, which was created pursuant to the Plan of Reorganization and confirmed by the Bankruptcy Court upon our emergence from bankruptcy. The maximum number of shares of restricted stock, which may be awarded to an employee in any single year under the 2004 LTIP as performance shares contemplated by the 2006 Annual Incentive Plan is 50,000. The maximum number of stock options which may be awarded to an employee in any single year under the 2004 LTIP as a performance based award contemplated by the 2006 Annual Incentive Plan is 100,000.

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Payment of Awards

     Any award payable in respect of a plan year will be paid by the Company within two weeks following the completion of the year-end audit by our independent accountants for the applicable plan year. All amounts payable for an award under the 2006 Annual Incentive Plan will be paid in cash or the Company’s stock as determined by our Compensation Committee, but the Company’s stock may be used, if at all, only for the portion of an award that exceeds fifty percent (50%) of a participant’s base salary.

Amendment and Termination

     The Compensation Committee has the right to amend or terminate the 2006 Annual Incentive Plan. In addition, in any plan year for which the Board determines in good faith that exigent circumstances exist which could have a material adverse impact on us if awards were paid, the Board will have the authority, in its absolute and sole discretion, to determine that (i) no awards will be paid for that plan year; (ii) awards for that plan year will be reduced; (iii) payment of awards for that plan year will be deferred for possible payment at a future date; or (iv) other adjustments will be made to the awards otherwise payable for that plan year.

New Plan Benefits

     The actual amount of compensation to be paid to participants under the 2006 Annual Incentive Plan is not determinable in advance because, among other things, specific performance criteria and targets will be selected each year by the Compensation Committee, and it is substantially uncertain what levels of performance will be realized against such criteria and targets. Awards paid in prior years were made either pursuant to the 2005 Annual Incentive Plan or pursuant to a bonus and incentive plan that was cancelled under the Plan of Reorganization and are not necessarily indicative of awards that the Company may make in the future. Any award so paid to our senior executives over the last three years is reflected in the “Bonus” column of the Summary Compensation Table appearing above.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE APPROVAL OF THE 2006 ANNUAL INCENTIVE PLAN IN CONFORMANCE WITH SECTION 162(m) OF THE CODE.

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COMPARATIVE PERFORMANCE GRAPH

     The following graph compares the performance of our Common Stock to the Standard & Poor’s 500 Stock Index and the AMEX Airlines Index for the period beginning July 28, 2004, the date of our emergence from bankruptcy, and ending on March 31, 2006. The comparison assumes $100 invested in each of our Common Stock, the Standard & Poor’s 500 Stock Index and the AMEX Airline Index and reinvestment of all dividends.

Total Return to Stockholders*

*	The comparison assumes $100 invested in each of our Common Stock, the S&P 500 Stock Index and the AMEX Airline Index and reinvestment of all dividends.

Total Return Between 7/28/2004 and 3/31/2006

Share Price	7/28/04	12/31/04	12/30/05	3/31/06
AAWW	$100.00	$143.97	$269.95	$282.54
S&P 500	$100.00	$110.64	$113.96	$118.21
AMEX Airline Index	$100.00	$133.22	$120.69	$123.73

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DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS TO BE PRESENTED
AT THE 2007 ANNUAL MEETING

Stockholder Proposals to Be Included in Our 2007 Proxy Statement

     We currently expect to hold our 2007 annual meeting of stockholders on or about May 22, 2007. Under the rules of the SEC, if a stockholder wants us to include a proposal in the proxy statement and form of proxy for presentation at our 2007 annual meeting, the proposal must be received by our Secretary no later than January 22, 2007. All stockholder proposals must be made in writing and addressed to the Secretary, Atlas Air Worldwide Holdings, Inc., 2000 Westchester Avenue, Purchase, New York 10577.

Advance Notice Procedures

     Under our By-laws, and as permitted by the rules of the SEC, no business may be brought before the Annual Meeting except as specified in the notice of the meeting or as otherwise brought before the Annual Meeting by or at the direction of the Board or by a stockholder entitled to vote who has delivered notice to us (containing certain information specified in our By-laws) not earlier than February 21, 2007 and not later than March 13, 2007. A copy of the By-laws will be sent to any stockholder upon written request to the Secretary of AAWW. These requirements are separate and apart from, and in addition to, the SEC’s requirements that a stockholder must meet in order to have his or her stockholder proposal included in our Proxy Statement, as discussed above.

ADDITIONAL COPIES OF ANNUAL REPORT

     A copy of our 2005 Annual Report on Form 10-K accompanies this Proxy Statement. If any person who was a beneficial owner of Common Stock on the Record Date desires additional copies, such copies may be obtained without charge upon request in writing addressed to the Secretary, Atlas Air Worldwide Holdings, Inc., 2000 Westchester Avenue, Purchase, New York 10577. Each such copy of our 2005 Annual Report on Form 10-K so furnished does not include any exhibits thereto, but is accompanied by a list briefly describing all such exhibits. We will furnish any such exhibit upon written request and upon payment of a reasonable specified fee. The Form 10-K is also available on our website at http://www.atlasair.com.

ADDITIONAL INFORMATION

Separate Voting Materials

     Some banks, brokers and other record holders have begun the practice of “householding” proxy statements and annual reports. “Householding” is the term used to describe the practice of delivering a single set of proxy statements and annual reports to any household at which two or more stockholders reside if a company reasonably believes the stockholders are members of the same family. This procedure would reduce the volume of duplicate information stockholders receive and would also reduce a company’s printing and mailing costs. We will promptly deliver an additional copy of either document to any stockholder who writes or calls us at the following address or phone number: the Secretary, Atlas Air Worldwide Holdings, Inc., 2000 Westchester Avenue, Purchase, New York, 10577, (914) 701-8000.

List of Stockholders

     At the Annual Meeting and for 10 days prior to the meeting, the names of stockholders entitled to vote at the Annual Meeting will be available for inspection at for any purpose germane to the meeting, between the hours of 9 a.m. and 5 p.m., at our principal executive offices at 2000 Westchester Avenue Purchase, New York 10577, by contacting the Secretary of AAWW.

Limited Voting by Foreign Owners

     To comply with restrictions imposed by federal aviation law on foreign ownership of U.S. airlines, our Certificate of Incorporation and By-laws restrict foreign ownership of shares of our Common Stock. The restrictions

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imposed by federal aviation law (49 U.S.C. §41102) currently include a requirement that no more than 25% of our voting stock be owned or controlled, directly or indirectly, by persons who are not “Citizens of the United States.” There is a separate requirement that we be under the actual control of Citizens of the United States.

     Pursuant to our By-laws, there is a separate stock record, designated the “Foreign Stock Record” for the registration of Voting Stock that is Beneficially Owned by aliens. “Voting Stock” means all outstanding shares of our capital stock that we may issue from time to time which, by their terms, may vote. “Beneficially Owned” refers to owners of our securities who, directly or indirectly, have or share voting power and/or investment power.

     At no time will ownership of our shares of Common Stock representing more than the Maximum Percentage be registered in the Foreign Stock Record. “Maximum Percentage” refers to the maximum percentage of voting power of Voting Stock which may be voted by, or at the direction of, aliens without violating applicable statutory, regulatory or interpretative restrictions or adversely affecting our, Atlas’s or Polar’s operating certificates or authorities. If we find that the combined voting power of Voting Stock then registered in the Foreign Stock Record exceeds the Maximum Percentage, the registration of such shares will be removed from the Foreign Stock Record sufficient to reduce the combined voting power of the shares so registered to an amount not in excess of the Maximum Percentage.

     The enclosed proxy card contains a certification that by signing the proxy card the stockholder certifies that such stockholder is a “Citizen of the United States” as defined by 49 U.S.C. §40102(a)(15) or that the shares represented by the proxy card have been registered on our Foreign Stock Record.

     We will promptly deliver a copy of our By-laws to any stockholder who writes or calls us at the following address or phone number: Attention: the Secretary, Atlas Air Worldwide Holdings, Inc., 2000 Westchester Avenue, Purchase, New York, 10577, (914) 701-8000.

Extent of Incorporation by Reference of Certain Materials

     The Audit Committee Report, the Compensation Committee Report on Executive Compensation and the Comparative Performance Graph included in this Proxy Statement do not constitute soliciting materials and should not be deemed filed or incorporated by reference into any other filing made by us under or subject to Regulation 14A or 14C (other than Item 7 to Regulation 14A), or to the liabilities of Section 18 of the Exchange Act, except to the extent we specifically incorporate such report or performance graph by reference therein.

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OTHER MATTERS

     As of the date of this Proxy Statement, we know of no business that will be presented for consideration at the Annual Meeting other than the election of directors and the approval of the 2006 Annual Incentive Plan, as referred to above. If any other matter is properly brought before the Annual Meeting for action by stockholders, all proxies (in the enclosed form) returned to us will be voted in accordance with the recommendation of the Board of Directors or, in the absence of such a recommendation, in accordance with the judgment of the proxy holder.

IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY AND THAT YOUR SHARES BE REPRESENTED. STOCKHOLDERS ARE URGED TO FILL IN, SIGN AND PROMPTLY RETURN THE ACCOMPANYING FORM OF PROXY IN THE ENCLOSED ENVELOPE.

	By Order of the Board of Directors
	JEFFREY H. ERICKSON
	President and Chief Executive Officer

May 25, 2006

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APPENDIX A – CURRENT AUDIT COMMITTEE CHARTER

AUDIT COMMITTEE CHARTER

ATLAS AIR WORLDWIDE HOLDINGS, INC.

I.   Purpose

     The Audit Committee (the “Committee”) is appointed by the Board to monitor: (i) the integrity of the financial statements of the Company, (ii) the independent auditor’s qualifications and independence, (iii) the performance of the Company’s internal audit function and independent auditor, and (iv) the compliance by the Company with legal and regulatory requirements.

II.   Organization

     The Committee shall consist of at least three Directors. Each Committee member shall be appointed by the Board and shall: (i) meet the independence requirements of the NASDAQ National Stock Market or such other primary trading market or securities exchange on which the Company’s securities are then traded (NASDAQ or such other market or exchange being referred to as the “Listing Entity”), and the rules and regulations of the Securities and Exchange Commission (the “SEC”); (ii) comply with and satisfy the requirements of all applicable laws, rules and regulations, including those promulgated by the SEC and the Listing Entity; and (iii) be financially literate and able to read and understand financial statements at the time of such Director’s appointment to the Committee.

     At least one member shall have the accounting or related financial management expertise necessary to qualify as an “audit committee financial expert” as defined in applicable laws, rules, and regulations of the SEC and the Listing Entity.

III.   Meetings

     The Committee shall meet at least four times a year after each fiscal quarter. In addition, the Committee shall meet at least quarterly with management, the director of internal audit, and the independent auditor in separate executive sessions to discuss any matters that the Committee or any of these groups believes should be discussed privately. The Committee may meet with such other persons, including the Company’s investment bankers and financial or legal advisors, as it deems necessary or appropriate. Meetings of the Committee shall be called by the Chairman of the Committee, the Chairman of the Board of Directors, or the Chief Executive Officer of the Company.

     The Committee shall report to the Board regarding the execution of its duties after each scheduled meeting of the Committee and shall keep written minutes of its meetings.

     A majority of the members of the Committee shall constitute a quorum for the transaction of business. The act of a majority of the members present at any meeting at which there is a quorum shall be the act of the Committee. Any Committee member may be excused from a meeting to permit the remaining members of the Committee to act on any matter in which such member’s participation is not appropriate, and such member’s absence will not destroy the quorum for purposes of acting on such matter.

IV.   Compensation

     Members of the Committee shall receive such fees, if any, for their service as Committee members as may be determined by the Board. Members of the Committee may not receive any compensation from the Company except the fees that they receive for service as a member of the Board or any committee thereof.

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V.	Committee Authority and Responsibilities
	A.	Independent Auditor
	The Committee shall:
	1. Appoint, determine the compensation of, evaluate, and oversee the work of the independent auditor, and, when appropriate, replace the independent auditor. The independent auditor shall report directly to and be dischargeable by the Committee.
	2. Approve in advance all audit and permitted non-audit services, including fees and terms that are to be performed by the independent auditor. The Committee may delegate pre-approval authority to the Chairman of the Committee, who shall report any pre-approval decisions to the full Committee at its 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.
	3. Review and discuss with the independent auditor any (i) problems or difficulties encountered by the independent auditor in the course of the audit work; (ii) changes to, or restrictions on, the scope of the independent auditor’s activities, access to information, the audit budget, or staffing; (iii) significant disagreements with management; (iv) communications between the independent auditing team and such team’s national office with respect to auditing or accounting issues presented by management; (v) accounting adjustments noted or proposed by the independent auditor (whether or not material), but not adopted by the Company and any material adjustment proposed by the auditor and recorded by the Company; and (vi) management or internal control letter issued, or proposed to be issued, by the independent auditor, and the Company’s response to that letter.
	4. Evaluate at least annually the qualifications, performance and independence of the independent auditor. Obtain and review on an annual basis a formal, written report from the independent auditor regarding (i) the auditor’s internal quality-control procedures, (ii) any material issues raised by the most recent quality-control review or peer review of the auditor, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years regarding independent audits carried out by the firm and any steps taken to deal with any such issues, and (iii) all relationships between the independent auditor and the Company.
	5. Ensure that the lead (or coordinating) audit partner is rotated at least every five years in accordance with applicable law.
	6. Ensure the Company will not hire as its chief executive officer, chief financial officer or chief accounting officer any individual who was employed by the Company’s independent auditor and who participated in any capacity in the audit of the Company within two years of such individual’s date of hire. Approve the hiring for any other position any individual who was employed by the independent auditor and who participated in any capacity in the audit of the Company within one year of such individual’s date of hire.
	B.	Financial Statement and Disclosure Matters
		The Committee shall:
	1. Review and discuss with management and the independent auditor, prior to any public release, the annual audited financial statements (including disclosures made in management’s discussion and analysis) and management’s certifications of such financial statements, and recommend to the Board whether the audited financial statements should be included in the Company’s Annual Report on Form 10-K.
	2. Review and discuss with management and the independent auditor, prior to any public release, the Company’s quarterly financial statements (including disclosures made in management’s discussion and analysis), the results of the independent auditor’s reviews of the quarterly financial statements, and management’s certifications of such financial statements.

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	3. Discuss with management and the independent auditor prior to any release (i) the Company’s earnings press releases, including the use of “pro-forma” or “adjusted” non-GAAP information, and (ii) financial information and earnings guidance provided to the investment community, banks, security analysts, and rating agencies.
	4. Review other relevant information submitted by the Company to any governmental body, or to the public, including any certifications required by law.
	5. Review and discuss with management and the internal auditor (i) the Company’s internal controls, disclosure controls, and internal reporting process and procedures, (ii) any significant deficiency in the design and operation of the internal controls, and (iii) any fraud, whether or not material, that involves any member of management who has a role in the Company’s internal controls.
	6. Discuss with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of the Company’s financial statements, including (i) any significant accounting policies and practices followed by the Company and their appropriateness under GAAP, (ii) any significant changes in the Company’s selection or application of accounting principles, (iii) the development, selection and disclosure of critical accounting estimates, and (iv) any alternative accounting treatments within GAAP discussed with the independent auditor and the analyses of the effect of alternative treatments on the Company’s financial statements.
	7. Discuss with management any litigation involving the Company and any contingent liabilities of the Company.
	8. Discuss with management and the independent auditor the effect that any regulatory and accounting proposals or initiatives might have on the financial results of the Company.
	9. Discuss with management and the independent auditor any off-balance sheet structures (including asset securitizations, joint ventures, and operating leases) and the impact they have on the Company’s financial statements.
	10. Discuss with management and the independent auditor the Company’s major financial risk exposures and the steps management has taken to monitor and control such exposures, including the Company’s risk assessment and risk management policies.
	11. Prepare a Report of the Audit Committee for inclusion in the Company’s annual proxy statement as required by the rules and regulations of the SEC.
	C.	Oversight of the Company’s Internal Audit Function
		The Committee shall:
	1. Review and approve the appointment and replacement of the senior internal auditing executive, the adequacy and qualifications of the internal audit staff, and the responsibilities and budget of the internal audit function. The senior internal auditor shall report directly to the Audit Committee. The Committee shall review the performance of the senior internal auditor and shall review and approve, at least annually, such auditor’s compensation.
	2. Review any significant reports to management prepared by the internal auditing department and management’s responses thereto.
	3. Discuss with the independent auditor the internal audit department responsibilities, budget, staffing and scope of the internal audit, as well as any proposed changes thereto.
	4. Review with the Company’s internal auditor, management, and independent auditor the adequacy of internal controls that could significantly affect the Company’s financial results.

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	D.	Compliance Oversight Responsibilities
		The Committee shall:
	1. Review and approve procedures for (i) complaints received by the Company regarding accounting, internal accounting controls, or auditing matters, and (ii) confidential, anonymous submission by employees of concerns regarding questionable accounting or audit matters, including the use of a Compliance Hotline.
	2. Obtain from the independent auditor a report on any illegal or questionable activities that have or may have occurred and that were discovered by the independent auditor during the course of its audit of the Company’s accounts.
	3. Review annually with management (i) the administration, training, monitoring and auditing of the Company’s Code of Conduct and Ethics applicable to senior financial executives (among others) and the Compliance Program (including policies set forth in the Atlas Air Employee Compliance Manual and other compliance policies), (ii) the effectiveness of such Compliance Program in preventing illegal and improper acts, and (iii) the timeliness of management’s response in the event any instances of illegal or improper acts are discovered.
	4. Obtain reports from management, the Company’s senior internal auditing executive, and the independent auditor that show the Company, its subsidiaries, and any foreign affiliated entities are in conformity with applicable legal requirements and the Company’s Code of Conduct and Ethics.
	5. Review reports and disclosures of insider and affiliated party transactions and/or conflicts of interest, or potential conflicts of interest, involving corporate officers and members of the Board of Directors, including any exceptions to the Code of Conduct and Ethics and the actions management has taken to resolve the exceptions. Review and approve, where appropriate, any involvement of corporate officers and members of the Board of Directors in matters that might constitute a conflict of interest or that may be otherwise required to be disclosed as a related party transaction under SEC regulations.
	6. Discuss with management and the independent auditor any correspondence with regulators or governmental agencies and any employee complaints or published reports that raise material issues regarding the Company’s financial statements or accounting policies.
	7. Review any reports of possible illegal or unethical activities, whether reported over the Company’s Compliance Hotline or otherwise.
	8. Discuss with management and company counsel any legal, regulatory and environmental matters that may have a material impact on the financial statements or the Company’s compliance policies.
	9. Review and assess compliance with applicable laws, rules, and regulations, including those of the SEC and the Listing Entity specifically applicable to the composition and responsibilities of the Audit Committee.

VI.   Resources

     The Committee shall have the authority, to the extent it deems necessary or appropriate, to retain special legal, accounting or other consultants to advise the Committee.

     The Committee may request any officer, employee of the Company, the Company’s outside counsel, or the independent auditor to attend a meeting of the Committee or to meet with any members of or consultants to, the Committee.

     The Committee shall request any reports, books, records or other material to be presented to it by the Company as it deems necessary in its sole discretion.

VII.   Evaluation

     The Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval. In addition, the Committee shall review annually the Committee’s own

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performance, subject to the process as may be established from time to time by the Nominating and Governance Committee or the Board.

     The Committee has the authority to, to the extent that it deems appropriate or desirable, appoint one or more subcommittees whose members meet the criteria for Committee members as set forth in this Charter.

     The Committee has the right to exercise any and all power and authority of the Board with respect to matters within the scope of this Charter, subject to the ultimate power and authority of the Board.

VIII.   Limitation of the Committee’s Role Regarding Certain Auditing and Financial Matters

     While the Committee has the responsibilities and powers set forth in this Charter, it is not the duty of the Committee to plan or conduct audits or to determine that the Company’s financial statements and disclosures are complete and accurate and are in accordance with generally accepted accounting principles and applicable rules and regulations. These are the responsibilities of management. The independent auditor is responsible for expressing an opinion on the financial statements of the Company.

IX.   Publication

     This Charter shall be published as required by applicable law and as otherwise deemed advisable by the Committee.

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APPENDIX B – CURRENT COMPENSATION COMMITTEE CHARTER

COMPENSATION COMMITTEE CHARTER

ATLAS AIR WORLDWIDE HOLDINGS, INC.

I.   Purposes

     The Committee has been established by the Board to assist the Board in discharging and performing the duties of the Board with respect to management compensation, succession planning and employee benefits, including the assessment and compensation of the Chief Executive Officer; the compensation of directors and other executive officers; the assessment of compensation arrangements, plans, policies and programs; the assessment of benefit and welfare plans and programs; the assessment of organizational systems and plans (including those relating to management development and succession planning); and the production of any report on executive compensation required by any applicable rules and regulations.

II.   Powers and Resources

     The Committee has the right to exercise any and all power and authority of the Board with respect to matters within the scope of this Charter, subject to the ultimate power and authority of the Board. The Board shall continue to have the ultimate duty and responsibility to manage or direct the management of the business and affairs of the Company.

The Committee has the authority to:

• conduct any and all investigations it deems necessary or appropriate, to contact directly the human resources department and other employees and advisors and require them to provide any and all informa- tion and advice it deems necessary or appropriate, and to retain legal, human resource or other advisors it deems necessary or appropriate;
  
  
• set aside for payment, pay and direct the payment of such legal, human resource and other advisors; the advisors retained by the Committee shall report directly to the Committee, and shall be accountable to the Committee and the Board, for their services; and
  
  
• to the extent that it deems appropriate or desirable, appoint one or more subcommittees whose members are non-employee directors and outside directors as set forth below and delegate to such subcommittee(s) the authority to make (including determining the terms and conditions of) grants or awards under, and to otherwise administer, bonus and incentive compensation plans and programs.

III.   Composition

     The Committee shall consist of at least three Directors, as may be determined from time to time by the Board. Each Committee member shall be appointed by the Board and shall be: (1) a member of the Board, (2) a non-employee director within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934, (3) an outside director within the meaning of Section 162(m) of the Internal Revenue Code of 1986, and (4) an independent director within the meaning of the rules of the NASDAQ National Stock Market or such other primary trading market or securities exchange on which the Company’s securities are then traded.

     Each member of the Committee shall serve until the next annual organizational meeting of the Board or the earlier of his or her termination as a member of the Committee by the Board, the election of his or her successor as a member of the Committee or his or her death, resignation or removal. The Board shall appoint a new member or members in the event that there is a vacancy on the Committee that reduces the number of members below three, or if the Board determines that the number of members on the Committee should be increased.

     Unless a Chair is elected by the Board, the members of the Committee may designate a Chair by a majority vote. The Chair shall supervise the conduct of the meetings and shall have other responsibilities as this Charter or the Committee may specify from time to time.

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IV.   Meetings

     The Committee shall meet in regular sessions at least four times a year and in special sessions as circumstances warrant, and may hold additional meetings in person or telephonically as often as may be necessary or appropriate, at the discretion of the Chair. When appropriate, the Committee may meet in separate executive sessions with management, employees, general counsel and internal audit to discuss any matters that the Committee or any of these groups believes warrant Committee attention. The Chair may also request that members of management, legal counsel, or other advisors attend the meetings of the Committee, but any individual whose performance or compensation is to be discussed at a Committee meeting should not attend such meeting unless specifically invited by the Committee (and the Chief Executive Officer may not be present during voting or deliberations as to his or her compensation).

     Committee members are expected to use all reasonable efforts to attend meetings and to spend the time needed to properly discharge their responsibilities. A majority of the members of the Committee shall constitute a quorum for the transaction of business. The act of a majority of the members present at any meeting at which there is a quorum shall be the act of the Committee. Any Committee member may be excused from a meeting to permit the remaining members of the Committee to act on any matter in which such member’s participation is not appropriate, and such member’s absence will not destroy the quorum for purposes of acting on such matter.

V.   Compensation

     Members of the Committee shall receive such fees, if any, for their service as Committee members as may be determined by the Board. Members of the Committee may not receive any compensation from the Company except the fees that they receive for service as a member of the Board or any committee thereof.

VI.   Procedures

     The Committee shall determine its meeting schedule, the agenda for each meeting, the information to be provided to it before or at each meeting and all other matters relating to the conduct of its meetings and other activities. The Chair of the Committee shall establish and distribute (or request the Secretary to distribute) to each Committee member prior to each meeting an agenda for the meeting. Each Committee member is free to raise at any meeting subjects that are not on the agenda for that meeting. Information that is important to understanding the business to be conducted at a meeting should generally be distributed to the Committee members as soon as practicable in advance of the meeting, and Committee members should review these materials before the meeting.

     The Committee shall keep minutes of its meetings and other proceedings.

     It is the sense of the Board that, subject to Section VII below, the activities and procedures of the Committee should remain flexible so that it may appropriately respond to changing circumstances. Thus, this Charter is intended to provide a set of flexible guidelines for the effective functioning of the Committee. The Committee may modify or amend this Charter and the authority and responsibilities of the Committee set forth herein at any time.

VII.   Committee Authority and Responsibilities

     Without limiting the scope of its responsibilities, duties and authority set forth above, the Committee shall:

Senior Management Performance; Senior Management and Director Compensation

	1.	Annually review and set the base salary of the Chief Executive Officer (the “CEO”). Review and approve annually the goals and objectives relevant to all compensation components of the CEO and evaluate his or her performance in light of those goals and objectives. In determining the long-term incentive component of the CEO’s compensation, the Committee should consider the Company’s per- formance and relative stockholder return, the value of similar incentive awards to chief executive officers at comparable companies, the awards given to the Company’s CEO in past years, and such other factors as the Committee deems appropriate. In evaluating and making recommendations with respect to the annual incentive portion of the CEO’s compensation, review the CEO’s performance against annual measures pre-established by the Committee. The Committee’s recommendations with respect to its review of the CEO’s performance and its impact on the CEO’s annual incentive compensation

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		shall be presented to, and subject to approval by, a panel consisting of the independent directors of the Board. Directors who do not meet all of the independence requirements for Committee membership may participate in such panel discussions, but shall not be present or vote on whether to approve the Committee’s recommendations.
	2.	Review and approve, as appropriate, the performance and compensation of the other executive officers and review compensation of other members of senior management and other employees generally). To the extent that long-term incentive compensation is a component of any executive officer’s compensation, the Committee shall consider all relevant factors in determining the appropriate level of such compensation, including without limitation the factors applicable with respect to the CEO. In evaluating and making recommendations with respect to the annual incentive portion of the other executive officers’ compensation, the Committee shall review their performance against annual measures pre-established by the Committee The Committee’s recommendations with respect to its review of the performance of the other executive officers and its impact on their annual incentive compensation shall be reviewed and approved by a panel consisting of the independent directors of the Board. Directors who do not meet all of the independence requirements for Committee membership may participate in such panel discussions, but shall not be present or vote on whether to approve the Committee’s recommendations.
	3.	Monitor the search for, and approve the proposed compensation for, any (a) officer and (b) employee whose proposed base salary exceeds $200,000 per year.
	4.	Periodically review and approve, as appropriate, the compensation of the directors.
	5.	Review and approve, as appropriate, the bonus and incentive compensation arrangements, plans, policies and programs, including annual and long-term and cash and stock-based plans.
	6.	Review periodically and approve, as appropriate, policies on management perquisites. Where necessary, review management’s determination of whether particular perquisites are business-related or personal.
		Advise the Audit Committee as to such policies.
	7.	Review any compensation or other benefit received by any director or executive officer from any affiliated entities to confirm compliance with the Company’s code of conduct and ethics and related policies.
	8.	Select, retain, evaluate and, as appropriate, terminate and replace any executive search firm or compensation consulting firm with respect to the selection and compensation of the Company’s senior officers.

Administration of Plans

	9.	Administer all stock-based compensation plans (including without limitation, those plans mandated by the Company’s plan of reorganization) and such other programs as may be designated by the Board, including the review and grant of stock option and other equity incentive grants to executive officers and other employees and directors, in each case subject to any limitations prescribed by the Board and subject to any authority delegated by the Committee to the subcommittee described below.
	10.	Review creation, modification, termination and funding of compensation, retirement, benefit and welfare arrangements, plans, policies and programs for senior management and other employees generally.
	11.	Review the administration of the self-directed retirement and other plans as to whether the rules relating to investments in the common stock are properly protective of employee interests.
	12.	Review periodically financial and investment policies and objectives of qualified and non-qualified retirement and benefit plans.
	13.	As and when required, establish performance goals and certify that performance goals have been attained for purposes of Section 162(m) of the Internal Revenue Code.
	14.	Approve all option plans (and amendments thereto) that are not subject to stockholder approval.

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Employee and Other Compensation Matters

	15.	Review and approve employment terms and agreements for new executive officers, any severance arrangements for executive officers, and any change of control, indemnification or other employment or compensation-related agreements to be entered into with executive officers.
	16.	Review periodically employee relations policies generally.
	17.	Review periodically equal opportunity employment and sexual harassment prevention policies, and monitor compliance with such policies and applicable laws.
	18.	Review and make recommendations with respect to stockholder proposals related to compensation matters.
Succession Planning
	19.	Coordinate with senior management the long-range planning for development and succession of senior management, including contingency planning for unanticipated sudden developments.
Regulatory Matters
	20.	Prepare annually the report to stockholders to be included in the annual proxy statement as required by the rules of the SEC.
Reports to Board
	21.	Report on its meetings, proceedings and other activities at each meeting of the Board.

VIII.   Evaluation

     The Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval. In addition, the Committee shall review annually the Committee’s own performance to determine whether the Committee is functioning effectively, including evaluating the Committee’s contributions to the Company, with a specific emphasis on areas in which such contributions could be improved, subject to the process as may be established from time to time by the Nominating and Governance Committee or the Board.

IX.   Publication

     This Charter shall be published as required by the rules and regulations of applicable law and as otherwise deemed advisable by the Committee.

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APPENDIX C – 2006 ANNUAL INCENTIVE PLAN FOR SENIOR EXECUTIVES

ATLAS AIR WORLDWIDE HOLDINGS, INC.

2006 ANNUAL INCENTIVE PLAN

FOR SENIOR EXECUTIVES

 

 

 

 

 

 

 

 

 

 

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TABLE OF CONTENTS

Section	Title	Page
1	Purpose	C-1
2	Definitions	C-1
3	Administration	C-1
4	Participation	C-2
5	Performance Measures	C-2
6	Awards under this Plan	C-3
7	Payment of Awards under this Plan	C-3
8	Grants under LTIP	C-4
9	Change in Control	C-4
10	Beneficiary Designation	C-4
11	General Provisions	C-4
12	Amendment and Termination	C-5
13	Effective Date	C-5

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ATLAS AIR WORLDWIDE HOLDINGS, INC.

2006 ANNUAL INCENTIVE PLAN

FOR SENIOR EXECUTIVES

1.   Purpose.

     The purpose of the Plan, which shall be known as the Atlas Air Worldwide Holdings, Inc. 2006 Annual Incentive Plan for Senior Executives, is to (a) provide incentives and rewards to certain management employees of Atlas Air Worldwide Holdings, Inc. (“AAWW”) by allowing them to earn awards based upon the financial performance of AAWW and upon their individual achievement of established personal goals; (b) assist AAWW in attracting, retaining, and motivating employees of high ability and experience; and (c) promote the long term interests of AAWW and its shareholders. The Plan is intended to provide performance based awards which are exempt from the limitations on tax deductibility imposed by Section 162(m) of the Internal Revenue Code of 1986, as amended (“Section 162(m)”), and to allow performance based awards under AAWW’s Long Term Incentive and Share Award Plan which are similarly exempt.

     The Plan shall be effective as of January 1, 2006, and shall be applicable for all future fiscal years of AAWW unless amended or terminated by the Committee pursuant to Section 11. Notwithstanding the foregoing, the Plan’s material terms (as defined Section 162(m)) shall be subject to re-approval by the stockholders of AAWW no later than the first meeting of stockholders to take place in 2011, if such approval is required by Section 162(m) at the time, and if such terms have not been earlier modified and submitted for stockholder approval.

2.	Definitions.
	2.1.	Award  shall mean any payments made under the Plan.
	2.2.	Base Salary  shall mean gross wages reported on an Eligible Employee’s federal W-2 Form, less all of the following: profit sharing payments made under any AAWW profit sharing program, bonus, per diem, compensation paid prior to becoming an employee of AAWW, expense reimbursements, life insurance imputed income, travel benefits, relocation reimbursement, housing allowances and other payments not ordinarily considered as part of an employee’s basic salary.
	2.3.	Board  shall mean the Board of Directors of AAWW.
	2.4.	Beneficiary  shall mean a Participant’s beneficiary pursuant to Section 10.
	2.5.	Committee  shall mean the Compensation Committee of the Board.
	2.6.	Eligible Employee  means the Chief Executive Officer, President, Executive Vice Presidents and Senior Vice Presidents of AAWW.
	2.7.	LTIP  means AAWW’s Long Term Incentive and Share Award Plan.
	2.8.	Objectives  shall mean the personal performance objectives particular to each Participant.
	2.9.	Participant  shall mean any Eligible Employee during such Eligible Employee’s period of participation in the Plan.
	2.10.	Performance Measure  shall mean the performance measure selected by the Committee for a Plan Year.
	2.11.	Plan  shall mean this AAWW Worldwide Holdings, Inc. 2006 Annual Incentive Plan for Senior Executives, as it may be amended from time to time.
	2.12.	Plan Year  shall mean the calendar year.
3.	Administration.
	3.1.	The Plan shall be administered by the Committee.

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	(a)	The Committee shall have full power and authority in its sole discretion to construe and interpret the Plan, establish and amend administrative regulations to further the purpose of the Plan, determine the extent to which Awards have been earned by virtue of satisfying the criteria described in Section 5, determine whether to reduce the Award otherwise payable as a result of meeting the established Performance Measure, determine whether to pay a portion of the Award in AAWW stock and take any other action necessary to administer the Plan. All decisions, actions or interpretations of the Committee shall be final, conclusive, and binding upon all Participants.
	(b)	If any Participant or Beneficiary objects to any such interpretation or action, formally or informally, the expenses of the Board, the Committee, AAWW and their agents and counsel in responding to such objection shall be chargeable against any amounts otherwise payable under the Plan to such Participant or Beneficiary if such objection is ultimately unsuccessful.

4. Participation.

     All Eligible Employees shall be eligible to participate in the Plan if they are employed as Eligible Employees as of the first day of the Plan Year. An individual who becomes an Eligible Employee during a Plan Year will participate immediately, but only with respect to Base Salary earned on and after the date he or she first becomes an Eligible Employee except to the extent the Committee determines in its sole discretion to allow exceptions, such as the consideration of Base Salary on an annualized basis.

5.	Performance Measures.
	5.1.	Performance Measures. The performance measures upon which the payment or vesting of an Award to a Participant that is intended to qualify as performance-based compensation for Code Section 162(m) purposes shall be limited to the following Performance Measures:
		(a)	Net earnings, net income or profits (before or after taxes);
		(b)	Earnings per share (basic or diluted);
		(c)	Net sales or revenue growth;
		(d)	Net operating profit;
		(e)	Return measures (including, but not limited to, return on assets, capital, invested capital, equity, sales, or revenue);
		(f)	Cash flow (including, but not limited to, operating cash flow, free cash flow, cash flow return on equity, and cash flow return on investment);
		(g)	Earnings before or after taxes, interest, depreciation, amortization and/or rent; (h) Gross or operating margins; (i) Productivity ratios;
		(j)	Share price (including, but not limited to, growth measures and total shareholder return);
		(k)	Expense targets;
		(l)	Margins;
		(m)	Operating efficiency;
		(n)	Market share;
		(o)	Working capital targets; and
		(p)	Cost reduction targets.

     Any Performance Measure(s) may be used to measure the performance of AAWW or any of its business units, subsidiaries or affiliates separately or any combination thereof, as the Committee may deem appropriate, or

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any of the above Performance Measures as compared to the performance of a group of comparator companies, or published or special index that the Committee, in its sole discretion, deems appropriate.

6.	Awards under this Plan
	6.1.	Maximum Bonus Award. A maximum annual bonus Award is hereby established at one-hundred sixty percent (160%) of Base Salary for the Chief Executive Officer and one-hundred percent (100%) of Base Salary for each other Participant.
	6.2.	Reductions in Bonus Award. The Committee shall have the discretion to reduce (but not to increase) the bonus Award otherwise payable based on such factors it chooses, including, without limitation, the Eligible Employee’s individual performance.
	6.3.	Effect of Corporate Exigencies. Notwithstanding anything in this Plan to the contrary, in any Plan Year for which the Board determines in good faith that exigent circumstances exist which could have a material adverse impact on AAWW if Awards were paid, the Board shall have the authority, in its absolute and sole discretion, to determine that (i) no Awards will be paid for that Plan Year, (ii) Awards for that Plan Year will be reduced, (iii) payment of Awards for that Plan Year will be deferred for possible payment at a future date, to the extent permissible under Internal Revenue Code Section 409A, or (iv) other adjustments will be made to the awards otherwise payable for that Plan Year.
	6.4.	Effect of Corporate Transactions. In the event of a corporate transaction, such as a divestiture, sale of assets or acquisition, which could have a material effect on AAWW, the Committee shall have the discretion to make equitable adjustments in the financial goals established under the Performance Measure.
7.	Payment of Awards under this Plan.
	7.1.	General. A Participant may receive an Award in each Plan Year in accordance with Section 5 and will be entitled to receive such Award if the Participant was still employed by AAWW as of the last day of the Plan Year for which the Award is paid, except as described in Section 7.4. A Participant will receive an Award in the manner and at the times set forth in Sections 7.2, 7.3 and 7.4.
	7.2.	Time of Payment. Any amount payable for an Award for a Plan Year shall be paid by AAWW within two weeks following the completion of the year-end audit for the applicable Plan Year.
	7.3.	Form of Payment. All amounts payable for an Award shall be paid in cash or AAWW stock, but AAWW stock may be used, if at all, only for the portion of the Award that exceeds fifty percent (50%) of Base Salary.
	7.4.	Termination of Employment.
		(a)	If a Participant terminates employment because of death, disability or retirement after attaining age 62 with five years of continuous AAWW employment, such Participant will remain eligible to participate in the Plan for that Plan Year, but considering only Base Salary earned prior to the termination.
		(b)	If a Participant terminates employment during the Plan Year for reasons other than those described in Section 7.4(a), such Participant will not be eligible to receive any portion of the Award.
		(c)	A Participant’s voluntary termination of employment after the completion of the Plan Year, but before Awards are paid out, will preclude the Participant from receiving that Award. A termination of employment during such time period by action of AAWW taken without cause, or for of any of the reasons described in Section 7.4(a), will not affect the right of the Participant to receive payment of an Award.

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8.   Grants under Long Term Incentive and Share Award Plan

     The Committee may select Performance Measures and determine that vesting or payment of grants made under the LTIP shall be subject to the satisfaction of financial goals established n connection with such Performance Measure. No Eligible Employee may receive a grant under the LTIP in any one year which exceeds 50,000 shares of AAWW’s common stock, or exceeds 100,000 stock options, where such grant is subject to Performance Measures and thus intended to constitute performance based compensation under Section 162(m).

9.   Change in Control.

     In the event of a change in control of AAWW during a Plan Year, Awards shall become payable as if the date of the change in control was the last day of a Plan Year, with the financial goal adjusted accordingly. (For example, if the change in control occurred on September 1, the financial goals would generally be 2/3 of the amount previously determined.) For this purpose, “change in control” shall mean any “person” (as such term is defined in Section 3(a)(9) of the Securities Exchange Act of 1934) (the “Exchange Act”) and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Corporation representing more than 50% of the combined voting power of AAWW’s then outstanding securities eligible to vote for the election of the Board; provided, however, that the event described above shall not be deemed to be a change in control by virtue of any of the following acquisitions: (i) by any employee benefit plan sponsored or maintained by AAWW of any subsidiary, or (ii) by any underwriter temporarily holding securities pursuant to an offering of such securities.

10.	Beneficiary Designation.
	10.1.	Designation and Change of Designation. Each Participant shall file with AAWW a written designation of one or more persons as the Beneficiary who shall be entitled to receive the Award, if any, payable under the Plan upon the Participant’s death. A Participant may, from time to time, revoke or change his Beneficiary designation without the consent of any prior Beneficiary by filing a new designation with AAWW. The last such designation received by AAWW shall be controlling; provided, however, that no designation, or change or revocation thereof, shall be effective unless received by AAWW prior to the Participant’s death, and in no event shall it be effective as of any date prior to such receipt.
	10.2.	Absence of Valid Designation. If no such Beneficiary designation is in effect at the time of a Participant’s death, or if no designated Beneficiary survives the Participant, or if such designation conflicts with law, the Participant’s estate shall be deemed to have been designated as the Participant’s Beneficiary and shall receive the payment of the amount, if any, payable under the Plan upon his death. If AAWW is in doubt as to the right of any person to receive such amount, AAWW may retain such amount, without liability for any interest thereon, until the rights thereto are determined, or AAWW may pay such amount into any court of appropriate jurisdiction and such payment shall be a complete discharge of the liability of the Plan and AAWW therefor.
11.	General Provisions.
	11.1.	A Participant may not assign an Award without the Committee’s prior written consent. Any attempted assignment without such consent shall be null and void. For purposes of this paragraph, any designation of, or payment to, a Beneficiary shall not be deemed an assignment.
	11.2.	The Plan is intended to constitute an unfunded incentive compensation arrangement. Nothing contained in the Plan, and no action taken pursuant to the Plan, shall create or be construed to create a trust of any kind. A Participant’s right to receive an Award shall be no greater than the right of an unsecured general creditor of AAWW. All Awards shall be paid from the general funds of AAWW, and no special or separate fund shall be established and no segregation of assets shall be made to assure payment of such Awards. The Plan is not intended to be a plan of deferred compensation as described in Section 409A of the Internal Revenue Code of 1986, as amended.
	11.3.	Nothing contained in the Plan shall give any Eligible Employee the right to continue in the employment of AAWW, or limit the right of AAWW to discharge an Eligible Employee.

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	11.4.	The Plan shall be construed and governed in accordance with the laws of the State of New York.
	11.5.	There shall not vest in any Participant or Beneficiary any right, title, or interest in and to any specific assets of AAWW.
	11.6.	There shall be deducted from all amounts paid under the Plan all federal, state, local and other taxes required by law to be withheld with respect to such payments.

12.   Amendment, Suspension, or Termination.

     The Committee reserves the right to amend, suspend, or terminate the Plan at any time.

13.   Effective Date.

     This Plan shall be effective with the Plan Year beginning January 1, 2006, subject to approval by AAWW’s shareholders.

 

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\/     DETACH PROXY CARD HERE      \/

	Please sign, date and return This proxy card in the Enclosed envelope.
		x
		Votes MUST be indicated (x) in Black or Blue ink.

1. Election of Directors
     The Board of Directors recommends a vote FOR the listed nominees.

Nominees:	Robert F. Agnew, Timothy J. Bernlohr, Keith E. Butler, Eugene I. Davis, Jeffrey H. Erickson, William J. Flynn, James S. Gilmore III, Carol B. Hallett and Frederick McCorkle	Certification: Pursuant to federal law and Atlas Air Worldwide Holdings, Inc.’s certificate of incorporation and by-laws, voting stock is subject to certain foreign ownership restrictions. By signing below, you represent that (1) you are a United States citizen as that term is defined by federal aviation law, or (2) the shares of stock represented by this Proxy have been registered on the foreign stock record of the company, as provided in the by-laws.

FOR all nominees for director listed above (except as marked to the contrary).	o	WITHHOLD AUTHORITY to vote for all nominees listed above.	o	WITHHOLD AUTHORITY to vote for an individual nominee(s). Write name(s) below.	o		To change your address, please mark this box        o and provide your new address. Mark here if you plan to attend the meeting.           o
							If you attend the meeting, you will be accompanied by __________________

			FOR	AGAINST	ABSTAIN
			o	o	o
2.		Approval of the 2006 Annual Incentive Plan for Senior Executives in conformance with Section 162(m) of the Internal Revenue Code. The Board of Directors recommends a vote FOR the above proposal.
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Please sign exactly as name appears on this Proxy. Joint owners each should sign. When signing as attorney, executor, administrator, trustee or guardian, please give the full title. If signing in the name of a corporation or partnership, please sign full corporate or partnership name and indicate title of authorized signatory.							______________	__________________	____________________
							Date	Share Owner sign here	Co-Owner sign here

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ATLAS AIR WORLDWIDE HOLDINGS, INC.
2000 Westchester Avenue, Purchase, New York 10577
Proxy for the Annual Meeting of Stockholders – June 27, 2006
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.

The undersigned appoints Michael L. Barna, John W. Dietrich and Michael W. Borkowski, and each of them, with full power of substitution in each, as proxies and authorizes them to vote all shares of common stock that the undersigned is entitled to vote at the Annual Meeting of Stockholders of Atlas Air Worldwide Holdings, Inc., to be held at the Omni Berkshire Hotel, 21 East 52nd Street, New York, NY 10022 on Tuesday, June 27, 2006 at 2:00 p.m. local time, and at any adjournment or postponement of the meeting, as indicated below.

Please date, sign and return this proxy promptly. This Proxy, when properly executed and returned, will be voted in the manner directed herein by the undersigned stockholder. If no direction is given, this Proxy will be voted FOR the election as directors of all of the nominees listed on the reverse side and FOR the approval of the 2006 Annual Incentive Plan for Senior Executives. The undersigned authorizes the Proxies to vote, in their discretion, upon any other matters as may properly come before the Annual Meeting.

If you plan to attend the meeting, please indicate in the space provided on the reverse side.

The Board of Directors recommends a vote FOR election as directors of the persons named in proposal 1 and FOR the approval of the 2006 Annual Incentive Plan for Senior Executives as set forth in proposal 2.

Change of address:			ATLAS AIR WORLDWIDE HOLDINGS, INC.  P.O. BOX 11162 NEW YORK, N.Y. 10203-0162

IMPORTANT: TO BE SIGNED AND DATED ON THE REVERSE SIDE
Please return this card in the self-addressed envelope provided

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