WORLDWIDE FLIGHT SECURITY SERVICE CORP - 10-K Annual Report

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

---------------

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001

OR

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

FOR THE TRANSITION PERIOD FROM TO

COMMISSION FILE NUMBER 333-88593

WORLDWIDE FLIGHT SERVICES, INC.
(Exact Name of Registrant as specified in its charter)

DELAWARE 75-1932711
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)

1001 WEST EULESS BOULEVARD
Suite 320
Euless, Texas 76040
(Address of principal executive offices) (Zip code)

Registrant's telephone number, including area code: (817) 665-3200

Securities registered pursuant to Section 12(b) of the Act: NONE

Securities registered Pursuant to Section 12(g) of the Act: NONE

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days. Yes [X] No [ ]

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

All 1,000 shares of common stock, par value $.01 per share (Common Stock) of the
registrant are held by the parent corporation. No shares of Common Stock are
held by non-affiliates.

As of December 31, 2001, the Registrant had outstanding 1,000 shares of voting
Common Stock and no shares of non-voting Common Stock.

Documents Incorporated by Reference

NONE

CO-REGISTRANTS

Oxford Electronics, Inc. was acquired on April 5, 2000 and is a wholly owned
subsidiary of Worldwide Flight Services, Inc.

The Board of Directors of Worldwide Flight Services, Inc. approved and adopted a
Plan of Merger effective December 31, 2000, whereby the herein described
subsidiary companies and former Co-Registrants were merged into Worldwide Flight
Services, Inc. Pursuant to the Plan of Merger, Worldwide Flight Services, Inc.
assumed all rights, liabilities, and obligations of subsidiary companies. The
subsidiaries and former Co-Registrants that were merged are:

Worldwide Flight Finance Company
Miami International Airport Cargo Facilities & Services, Inc.
Miami Aircraft Support, Inc.
Aerolink International, Inc.
Aerolink Maintenance, Inc.
Aerolink Management, Inc.
Aerolink International, L.P.

International Enterprises, Group, Inc. was liquidated effective December 4,
2000.

Oxford Electronics, Inc. was acquired on April 5, 2000 and is a wholly owned
subsidiary of Worldwide Flight Services, Inc.

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TABLE OF CONTENTS

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This annual report contains forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934. The words "believe,"
"estimate," "anticipate," "project," "intend," "expect" and similar expressions
are intended to identify forward-looking statements. All forward-looking
statements involve some risks and uncertainties. In light of these risks and
uncertainties, the forward-looking events discussed in this report might not
occur. Factors that may cause actual results or events to differ materially from
those contemplated by the forward - looking statements include, among other
things, the matters discussed under "Item 1. Business -- Risk Factors" and the
following possibilities:

o future revenues are lower than expected;

o increase in payroll or other costs and/or shortage of an adequate base of
employees;

o loss of significant customers through bankruptcy, industry consolidation or
other factors;

o inability to obtain additional capital due to covenant restrictions or
other factors, and/or increase in debt levels beyond our ability to support
repayment;

o costs or difficulties relating to the integration of businesses that we
acquire are greater than expected;

o expected cost savings or revenues from our acquisitions or expected cost
savings from our restructuring plan are not fully realized or realized
within the expected time frame;

o competitive pressures in the industry increase;

o general economic conditions or conditions affecting the airline industry or
other industries that ship cargo by air, whether internationally,
nationally, or in the states in which we do business, are less favorable
than expected,

o changes in the interest rate environment, and

o acts of terrorism targeted at the aviation industry.

You are cautioned not to place undue reliance on forward-looking statements
contained in this report as these speak only as of its date. We undertake no
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise except as required by
law.

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PART I

ITEM 1. BUSINESS

Unless otherwise indicated, "we" and "Worldwide" are used in this report to
refer to the business of Worldwide Flight Services, Inc. and its consolidated
subsidiaries. In addition, "MAS," "Aerolink," and "Oxford" are used to refer to
the business of Miami Aircraft Support, Inc., Aerolink International, Inc. and
its affiliates, and Oxford Electronics, Inc., respectively.

Worldwide was incorporated in Delaware on December 12, 1983 as AMR Services
Corporation ("AMRS"), a subsidiary of AMR Corporation ("AMR"). On March 31,
1999, Worldwide was acquired by WFS Holdings, Inc. ("Holdings"), which was owned
by Castle Harlan Partners III, L.P., its affiliates (collectively "Castle
Harlan") and some members of Worldwide's management (the "Castle Harlan
acquisition"). Following the acquisition, Worldwide changed its name from AMR
Services Corporation to Worldwide Flight Services, Inc.

Since March 1999 Worldwide has made three significant acquisitions: on August
12, 1999 Worldwide purchased all of the stock of Miami Aircraft Support for
approximately $63.0 million; on August 23, 1999 Worldwide purchased all of the
stock of Aerolink International, Inc. and its affiliates for approximately $5.9
million, plus an earn-out of $1.0 million which was paid in 2000; and on April
5, 2000 Worldwide purchased all the stock of Oxford Electronics, Inc. for
approximately $9.6 million, plus a deferred payment of $2.5 million which was
paid in the first quarter of 2001.

On September 11, 2001 four passenger airline aircraft were hijacked and
destroyed in terrorist attacks on the World Trade Center and the Pentagon.
During the weeks following the attacks, the airline industry experienced a sharp
decline in passenger traffic and yields. In response, many airlines reduced
their operating schedules by as much as 20%. Air traffic has not yet returned to
pre-September 11 levels. This reduction in frequencies significantly reduced our
revenues, earnings and weakened our cash position during the months following
the attacks.

On October 5, 2001 Vinci Airport, Inc., a Delaware corporation which changed its
name to Vinci Airports US Inc. on February 19, 2002, acquired all of the capital
stock of WFS Holdings Inc. (the "2001 acquisition"). Vinci Airports US Inc. is a
wholly-owned subsidiary of Vinci Airports S.A. The transaction was consummated
pursuant to an Agreement and Plan of Merger and Stock Purchase Agreement dated
as of September 7, 2001 among WFS Holdings, Inc., Airline Container Acquisition
Corp., Castle Harlan Partners III, L.P., Vinci S.A., Vinci Airports US Inc. and
Vinci Merger Sub Corp. The transaction, which was completed utilizing funds of
Vinci Airports US Inc., had a fair value to Worldwide of approximately $254.8
million, including transaction costs. Airline Container Acquisition Corp. is a
separate holding under Vinci Airports US Inc. and is therefore not a part of
Worldwide's consolidated group.

In November 2001 the Aviation and Transportation Security Act ("ATSA") was
enacted, creating a new government agency, the Transportation Security
Administration ("TSA"). The newly formed TSA is part of the United States
Department of Transportation ("DOT") and is responsible for aviation security.
The ATSA mandates that the TSA shall provide for the screening of all passengers
and property, including U.S. mail, cargo, carry-on and checked baggage. The TSA
assumed most passenger screening functions in February 2002, largely by
contracting with private-sector security providers; however, the TSA is required
to have its own federal employees performing these functions by November 2002.
Less than 5.0% of Worldwide's 2001 revenues were derived from security
check-point screening services, which are currently contracted with the TSA.

Services

Worldwide is a leading provider of aviation services, operating in approximately
100 airports throughout North America, Europe and Hong Kong. With approximately
10,400 employees, we provide cargo handling, technical contracting and ramp and
passenger services to over 300 customers. Our customer base is made up of
passenger airlines, air-cargo carriers and airports.

Cargo Handling: Cargo handling is our largest line of business and consists
primarily of loading and unloading aircraft. We also manage warehouse facilities
for selected customers where we process inbound freight, remove it

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from pallets or containers, store it and facilitate further shipping or pickup.
We are one of the largest service providers for express air-cargo carriers that
deliver time sensitive parcels, mail and other cargo. We also handle various
types of cargo items, including perishables, electronic equipment, valuables and
bulk items for other air carrier customers.

We provide cargo handling services at various U.S. and Canadian airports,
including John F. Kennedy International Airport in New York, Dallas-Fort Worth
International Airport and Miami International Airport. We also provide
cargo-handling services in several European countries, including France, Italy,
Spain, Austria, Germany, Belgium, Holland and the United Kingdom. In France we
are a leading provider of cargo services with operations in eight major
airports.

Ramp Services: Ramp services are principally provided to passenger airlines and
include guiding the aircraft to and from the gate; loading and unloading baggage
and freight; fueling aircraft; managing airport fuel storage facilities;
de-icing aircraft; cleaning cabins; and providing heating, air conditioning,
lavatory and water services for aircraft.

Passenger Services: Passenger services include curbside baggage checking,
security screening, airline lounge staffing, gate departure services, passenger
baggage services and wheelchair assistance. We also provide ticket counter
services, which include helping passengers check baggage, receive boarding
passes, purchase tickets and receive flight-related information.

Technical Services: Technical services are principally provided to airports and
include preventative maintenance and mechanical support for jet bridges, baggage
conveyors and ground equipment.

Customers

We service over 300 customers, which consist primarily of passenger airlines,
air-cargo carriers and airports. We also provide a variety of services to
freight forwarders and other non-airline customers. Our airline customers
include American Airlines and its affiliates (collectively "American"), British
Airways, Continental Airlines, Korean Air Lines and Saudi Arabian Airlines.
Air-cargo carrier customers include the United States Postal Service, UPS, DHL,
Emery, Cargo Lux and BAX Global. Significant airport customers include the
Houston Intercontinental Airport and the Hong Kong Airport Authority. Our top
ten customers, including American, accounted for approximately 45.4% of total
revenues for the twelve months ended December 31, 2001. Other than American,
which accounted for approximately 20.5% of total 2001 revenues, no single
customer accounted for more than 10% of our revenues.

We generally provide service under contract, and at December 31, 2001 we had
over 420 service contracts. These contracts are typically based on standard
industry forms that are customized to fit the desired contractual arrangement.
Most of our service contracts are effective for a specified term and allow our
customers to terminate their contract on ninety days notice. Many of our
contracts automatically renew after the initial term, but become terminable by
either party with a sixty-day notice. Several of our contracts contain price
escalation clauses, which are linked to the consumer price index. Under these
clauses, if the consumer price index increases, we are permitted to increase our
prices by the consumer price index or a percentage thereof.

Competition

The ground services industry is fragmented and consists of a large number of
domestic and international service providers. Although many of these companies
operate at multiple airports, only a few provide services nationally or
internationally. In the United States, our principal competitors include
nationally operated ground service providers such as DynAir Services (subsidiary
of Swissport), Hudson General Corporation (subsidiary of Globeground) and
Menzies Aviation Group (formerly Ogden Aviation Corporation), as well as many
smaller companies that operate regionally or at individual airports.
Internationally, we compete principally with international ground service
providers such as Cargo Service Centers, Globeground, Servisair and Swissport.
In addition, we indirectly compete with various airlines that perform a large
portion of their ground services in-house.

The principal competitive factors in our industry are price, reputation, quality
of service, breadth of service and experience. We believe that we compare
favorably to our competition with respect to all of these factors.

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Employees

As of December 31, 2001 we had approximately 10,400 employees worldwide, of
which approximately 41% worked part-time. In 2001 approximately 59% of our U.S.
employees were represented by collective bargaining agreements. These employees
consist primarily of cargo handlers, security screeners and ramp services
workers and are typically represented by the Transport Workers Union ("TWU").
Our agreement with the TWU was re-negotiated in 2000 and is effective through
June 2003. In Canada, approximately 306 of our employees are represented by the
Canadian Auto Workers Union. Approximately 211 of these employees are covered by
an Agreement in effect until June 2003. The International Association of
Machinists represents approximately 95 employees in Canada. In certain other
countries, we are subject to industry-wide collective bargaining agreements, as
well as local labor laws.

We have not experienced any material business interruption as a result of labor
disputes and believe that we have a good relationship with our unions and
employees.

Regulatory Compliance

As a service provider in the aviation industry we are subject to a significant
number of regulations, including those promulgated by the Federal Aviation
Administration ("FAA"), the DOT, the United States Environmental Protection
Agency ("EPA"), the National Transportation Safety Board ("NTSB"), the TSA and
others.

The ATSA, which was enacted in November 2001, requires the TSA to provide
screening for all passengers and property, including U. S. mail, cargo, carry-on
and checked baggage. As airport and passenger security evolves, we expect a
significant number of new regulations and guidelines, which could significantly
increase the cost of providing certain services to our customers.

Because we accept or otherwise handle hazardous materials, such as explosives
and toxic materials, we must register with the DOT and comply with all its
regulations governing the handling, packaging, marking, labeling and
transportation of hazardous materials. In addition, employees who accept or
handle hazardous materials must comply with DOT safety regulations, which
include requirements for specialized training. Failure to properly handle,
package, mark, label or transport hazardous materials or to properly train
employees involved in handling hazardous materials could result in significant
penalties and fines.

While we do not hold an FAA-issued repair station certificate and do not promote
ourselves as an FAA-certificated repair station, we employ certified and rated
mechanics that perform limited aircraft maintenance. These mechanics must
perform their duties in accordance with FAA Regulations and failure to comply
with these regulations could result in significant penalties and fines, as well
as the suspension or revocation of each individual mechanic's certificates.

We currently have an FAA approved random testing and drug and alcohol abuse
program, officially known as the Drug and Alcohol Misuse Prevention Program,
which covers our certified mechanics, security screeners, cargo screeners and
other employees who perform safety sensitive functions. If we fail to comply
with the FAA drug and alcohol regulations, we could be fined or restricted from
performing these services in the future.

Environmental

In two United States locations and in Hong Kong, we manage fueling operations.
In most of our locations, we maintain equipment for our operations. Both of
these activities require us to store and dispose of various petroleum products.
The EPA and other state and local environmental agencies regulate activities
related to the storage, disposal and remediation of petroleum-based products
used in the airline industry. As a result, we are required to comply with a
variety of international, federal, state and local laws and regulations relating
to environmental protection. In addition, we are required to comply with various
Airport Authority Storm Water Pollution Prevention Plans or permits and train
employees on preserving clean water according to the plans or permits. Although
we believe we are in compliance with all related environmental laws and
regulations, engaging in these activities may result in obligations to remove or
mitigate the effects on the environment.

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In connection with the Castle Harlan acquisition, Worldwide obtained
environmental indemnities from AMR, subject to deductibles, for all
environmental liabilities that relate to periods prior to the closing of the
sale. We also received environmental indemnities from the sellers of MAS,
Aerolink and Oxford.

Risk Factors

OUR SUBSTANTIAL AMOUNT OF DEBT COULD MATERIALLY HARM OUR FINANCIAL HEALTH

As of December 31, 2001 we had $131.1 million of long-term debt, of which, $1.4
million is due within one year. Our long-term debt consists of 12.25% Senior
Notes due in 2007, (the "Senior Notes") with a face value of $124.5 million and
a carrying value of $125.8 million, $5.1 million in capital leases and $0.2
million other international debt. Interest on the Senior Notes outstanding at
December 31, 2001, totaling approximately $15.3 million per year, is payable
semi-annually on February 15 and August 15. Capital leases primarily relate to
long-term facility leases in Europe and various equipment leases assumed in the
acquisition of MAS, Aerolink and Oxford.

An intercompany demand loan from Vinci Airports US Inc. was established to
provide short-term liquidity until we can acquire other funding. The interest
rate on this loan is based on the one-month LIBOR rate plus 0.75% and is payable
upon demand. At December 31, 2001 the outstanding balance was $72.1 million.

At December 31, 2001 our total stockholder's equity was $29.9 million and we had
a negative tangible net worth of approximately $140.1 million. For the twelve
months ended December 31, 2001 we had a net loss of approximately $72.2 million,
including a $40.0 million impairment charge to goodwill. The high level of debt,
combined with continued losses, will require us to dedicate a large portion of
our free cash flow to make interest payments. Eventually, this could impact our
ability to support working capital requirements, make required capital
expenditures or service our debt. In addition, this level of debt may also
increase our vulnerability to general adverse economic and industry conditions;
place us at a competitive disadvantage compared to our competitors with
proportionately less debt; and limit our flexibility in planning for or reacting
to changes in our business and the ground services industry.

We anticipate that our cash flow from operations will be sufficient to service
our debt obligations as they become due, however, our ability to meet these
requirements depends on future financial performance, which may be affected by
financial, business, economic, competitive and other factors. If we cannot
generate sufficient cash flow to service our debt and meet other operating
requirements, we may be required to reduce or delay investments in our business
or raise additional debt or equity capital. Furthermore, the terms of existing
or future debt agreements may restrict us from adopting either of these
alternatives or may otherwise restrict our ability to make distributions or
other payments to our investors and creditors.

IF WE FAIL TO MAINTAIN OUR RELATIONSHIPS WITH AMERICAN AND OTHER SIGNIFICANT
CUSTOMERS, IT COULD ADVERSELY AFFECT OUR BUSINESS

Revenues from our top ten customers, including American, accounted for
approximately 45.4% of our total revenues for the twelve months ended December
31, 2001. American accounted for approximately 20.5% of our total revenues for
that same period. If we fail to maintain our relationship with American or
experience a significant reduction in business from American or from any of our
significant customers, it could adversely affect our business and limit our
ability to meet operating requirements or to service debt obligations.

Many of our customers, including American, currently provide a significant
portion of their own ground services. Revenues from these customers could
decrease if they choose to in-source these services.

OUR CUSTOMERS MAY TERMINATE THEIR CONTRACTS WITH US ON SHORT NOTICE, WHICH COULD
ADVERSELY AFFECT OUR BUSINESS

Most of our contracts have a one-year term, however, in many cases, the customer
can terminate service with a ninety-day written notice. After the initial term,
many of our contracts convert to a month-to-month contract, which generally
allows either party to

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terminate the contract upon a sixty-day written notice. Performance related
terminations usually require little or no notice. While we believe these terms
are typical in the industry, we can provide no assurance that customers will not
terminate their contracts. The termination of significant contracts could
adversely affect our business.

OUR RIGHTS TO OPERATE AT AIRPORTS COULD BE TERMINATED BY LOCAL AIRPORT
AUTHORITIES, WHICH COULD ADVERSELY AFFECT OUR BUSINESS

In order to provide services at an airport, the local airport authority must
first grant us permission to operate at the airport. Generally, this permission
is granted through the issuance of a permit. In addition, we are required to
maintain certain licenses and consents to comply with the terms of these permits
or other standards set by the airport authority. In many cases, the permit can
be revoked or otherwise terminated by the airport authority at will and without
cause. The loss of one or more of our permits, licenses or consents could affect
our ability to operate at these airports, which in turn could adversely affect
our business.

THE OCCURRENCE OF SIGNIFICANT ADVERSE EVENTS AFFECTING THE AIRLINE INDUSTRY
COULD ADVERSELY AFFECT OUR BUSINESS

The majority of our services is provided to air-cargo and passenger airlines. As
such, the events that affect those businesses will likely affect our business.
Events affecting the airline industry may include a prolonged increase in fuel
costs, union strikes, an economic downturn in one or more geographic markets,
changes in foreign currency exchange rates, changes in interest rates and acts
of terrorism. The downturn in the economy had a negative impact on the
profitability of Worldwide prior to the events of September 11, 2001.

On September 11, 2001 four passenger airline aircraft were hijacked and
destroyed in terrorist attacks on the World Trade Center and the Pentagon.
During the weeks following the attacks, the airline industry experienced a sharp
decline in passenger traffic and yields. In response, many airlines reduced
their operating schedules by as much as 20%. Air traffic has not yet returned to
pre-September 11 levels. The events of September 11, 2001 brought to light the
significant risk of terrorism to the airline industry.

IF WE DO NOT COMPETE EFFECTIVELY WITH OTHER GROUND SERVICE PROVIDERS, WE COULD
LOSE CUSTOMERS, WHICH IN TURN COULD ADVERSELY AFFECT OUR BUSINESS

The ground services business is highly competitive. Our competitors include
various international, national, regional and local service providers. We also
compete with certain airlines that provide these services in-house and other
transportation businesses such as trucking companies. Service, quality and price
are particularly important competitive factors in our industry. We also compete
a limited number of airport permits in certain cities.

Changes in economic conditions, outsourcing strategies or government imposed
regulations may require airlines to in-source many of their ground handling
services.

FLUCTUATIONS IN FOREIGN CURRENCY MAY ADVERSELY AFFECT OUR FINANCIAL PERFORMANCE

We derive a significant portion of our revenue from international locations such
as Canada, France, Hong Kong and the United Kingdom. As such, we are exposed to
the affect of foreign currency exchange rate fluctuations. Worldwide's largest
exposure comes from the Canadian dollar, the Euro, the Hong Kong dollar and the
British pound. Significant fluctuations in these exchange rates could result in
exchange rate losses, which in turn could adversely affect our business. We
periodically hedge some of these foreign currencies, although we may not do so
in the future. We had no foreign currency contracts at December 31, 2001.

IF WE DO NOT COMPLY WITH SIGNIFICANT ENVIRONMENTAL REGULATIONS, WE COULD FACE
FINES OR RESTRICTIONS ON OUR OPERATIONS, WHICH IN TURN COULD ADVERSELY AFFECT
OUR BUSINESS

We must comply with a variety of international, federal, state and local
governmental regulations relating to the use, storage, discharge, emission and
disposal of hazardous substances and wastes, remediation of contamination
associated with the releases of hazardous substances and worker health and
safety.

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We manage two fueling operations in the United States and one in Hong Kong. In
connection with our fueling operations, we utilize fuel trucks, above-ground
storage tanks and sub-surface fuel lines that may give rise to unknown releases.

Miami-Dade County is currently investigating various environmental conditions at
the Miami International Airport. During the second quarter of 2001 the County
filed a lawsuit against several companies operating within the airport.
Worldwide was not directly named in this lawsuit, however we were named as a
potential contributor. Worldwide's portion of the cleanup cost cannot be
reasonably estimated due to various factors, including the unknown extent of the
remedial actions that may be required and the proportion of costs that will
ultimately be assigned to Worldwide. Other than the Miami-Dade action, we are
not aware of any significant environmental issues or related actions. However,
future events, such as the discovery of unknown contamination, future spills and
releases, compliance with more stringent regulations, more vigorous enforcement
policies by regulatory agencies or stricter interpretations of existing
regulations could cause operating constraints or require significant
expenditures for remedial action or to comply with evolving environmental
regulations. While Worldwide carries insurance that covers many of these risks,
these or other events relating to compliance with environmental regulations
could materially adversely affect our business.

ITEM 2. PROPERTIES

Our headquarters are located in Euless, Texas, where we lease approximately
26,800 square feet of office space. This lease expires on August 15, 2004. We
also lease other space at numerous airports around the world. Many of these
leases are on a month-to-month basis. We do not own any facilities.

ITEM 3. LEGAL PROCEEDINGS

Other than discussed below, we are not a party to any legal proceedings, other
than ordinary routine litigation incidental to our business, that we believe are
material to our business or financial condition.

Worldwide is involved in an investigation by the NTSB into the cause of the
crash of an Emery Worldwide Airlines, Inc. cargo jet on February 16, 2000. The
crash occurred shortly after takeoff from Mather Field in Sacramento,
California, killing all three people aboard. MAS, a subsidiary of Worldwide,
loaded the cargo onto the plane. We are cooperating with the NTSB in the
investigation, and to date the NTSB has not issued its report.

In addition to the NTSB investigation, we are one of several defendants in three
individual lawsuits arising out of the crash. One of the suits is filed in state
court in California, one in state court in Ohio and one in state court in Texas.
Worldwide believes that it has adequate insurance coverage if any liability were
to ultimately be assessed in these suits.

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

No matter was submitted to a vote of Worldwide's shareholders during the fourth
quarter of the fiscal year covered by this report.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

There is no public trading market for our common stock. As of December 31, 2001
all of our outstanding shares of common stock were held by WFS Holdings, Inc.,
our parent. (see "Item 12. Security Ownership of Beneficial Owners and
Management.") We did not pay dividends on our common stock during 2001 and do
not intend to pay any dividends on our common stock for the foreseeable future.
The Senior Notes indenture contains certain covenants that restrict our ability
to pay dividends.

ITEM 6. SELECTED FINANCIAL DATA

You should read the selected consolidated financial data set forth below in
conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operations," the consolidated financial statements and the notes
thereto, and the other financial information included herein.

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WORLDWIDE AND AMRS FINANCIAL INFORMATION

The selected consolidated financial data for the period from October 6, 2001
through December 31, 2001, the period from January 1, 2001 through October 5,
2001, the year ended December 31, 2000 and the nine-month period ended December
31, 1999 were derived from Worldwide's audited consolidated financial
statements. The selected consolidated data for the three-month period ended
March 31, 1999 and the years ended December 31, 1998 and 1997 were derived from
AMRS's audited consolidated financial statements:

(a) The twelve-month period ended December 31, 2001 represents a
combination of two interim periods, the period from January 1 through
October 5, 2001, which represents the period prior to the 2001
acquisition, and the period from October 6, 2001 through December 31,
2001, which represents the period subsequent to the 2001 acquisition.
No dividends were declared or paid during the periods presented.

(b) The twelve-month period ended December 31, 1999 represents a
combination of two interim periods, the three-month period ended
March 31, 1999, which represents the period prior to the Castle
Harlan acquisition, and the nine-month period ended December 31,
1999, which represents the period subsequent to the Castle Harlan
acquisition. No combined information is presented for income (loss)
from continuing operations as Worldwide and AMRS had different
capital structures and a combination of such data is not meaningful.
No dividends were declared or paid during the periods presented.

8

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Management's Discussion and Analysis is Worldwide's analysis of its financial
performance and of significant trends that may affect future performance. It
should be read in conjunction with the consolidated financial statements and the
accompanying notes.

OVERVIEW

Worldwide was incorporated in Delaware on December 12, 1983 as AMR Services
Corporation, a subsidiary of AMR. On March 31, 1999 Worldwide was acquired by
WFS Holdings, Inc., which was owned by Castle Harlan Partners III, L.P. and its
affiliates. Following the Castle Harlan acquisition, Worldwide changed its name
from AMR Services Corporation to Worldwide Flight Services, Inc.

Worldwide's business was not operated by AMR as a single entity, but instead
operated through a number of companies that were part of the AMR Global Services
group. Prior to the date the Castle Harlan acquisition was closed, some of these
operations were sold or were merged directly into AMR. The financial statements
and financial information included in this annual report for AMR Services
Corporation represent the entity purchased, and not the distinct AMR Services
Corporation legal entity that existed prior to the Castle Harlan acquisition.

Since March 1999 Worldwide has made three significant acquisitions: on August
12, 1999 Worldwide purchased all of the stock of MAS for approximately $63.0
million; on August 23, 1999 Worldwide purchased all of the stock of Aerolink for
approximately $5.9 million, plus an earn-out of $1.0 million which was paid in
2000; and on April 5, 2000 Worldwide purchased all the stock of Oxford for
approximately $9.6 million, plus a deferred payment of $2.5 million which was
paid in the first quarter of 2001.

On October 5, 2001 Vinci Airports US Inc. acquired all of the capital stock of
WFS Holdings Inc. Vinci Airports US Inc. is a wholly-owned subsidiary of Vinci
Airports S.A. The transaction was consummated pursuant to an Agreement and Plan
of Merger and Stock Purchase Agreement dated as of September 7, 2001 among WFS
Holdings, Inc., Airline Container Acquisition Corp., Castle Harlan Partners III,
L.P., Vinci S.A., Vinci Airports US Inc. and Vinci Merger Sub Corp. The
transaction, which was completed utilizing funds of Vinci Airports US Inc., had
a fair value to Worldwide of approximately $254.8 million, including transaction
costs. Airline Container Acquisition Corp. is a separate holding under Vinci
Airports US Inc. and is therefore not a part of Worldwide's consolidated group.

Although we have reported losses for all periods subsequent to March 31, 1999,
management believes that the changes made to Worldwide's operations will help
improve our results in the future. We believe these changes address the current
challenging economic climate as we progress with a new management team.

RESULTS OF OPERATIONS

CONSOLIDATED RESULTS

Revenues, loss from continuing operations and net loss for the year ended
December 31, 2001 were $344 million, $51.6 million and $72.2 million,
respectively. For the year ended December 31, 2001 interest expense was $21.3
million.

As a result of the 2001 acquisition the balance sheet was adjusted to fair value
under the purchase method of accounting. Consequently, the information for the
period from October 6, 2001 through December 31, 2001 is presented using a
different financial basis than for the period from January 1, 2001 through
October 5, 2001. However, for purposes of analysis, financial information for
the entire twelve-month period, which represents an adjusted combination of the
two periods, is presented in the discussion and tables of this section.
Similarly, the results of 1999 are not comparable to 2000 due to the Castle
Harlan acquisition in March 1999, but are presented in a combined manner for
discussion purposes. No adjustments have been made to include MAS, Aerolink, or
Oxford for periods prior to their acquisitions.

On September 11, 2001 four passenger airline aircraft were hijacked and
destroyed in terrorist attacks on the World Trade Center and the Pentagon.
During the weeks following the attacks, the airline industry experienced a sharp
decline in passenger traffic and yields. In response, many airlines reduced
their operating schedules by as much as 20%. This reduction significantly
reduced our revenue, earnings and weakened our cash position during the months
following the attacks, however the long-term impact is not yet known. Air
traffic has not yet returned to pre-September 11 levels.

9

The newly formed TSA is part of the DOT and is responsible for aviation
security. The ATSA mandates that the TSA shall provide for the screening of all
passengers and property, including U.S. mail, cargo, carry-on and checked
baggage. The TSA assumed most passenger screening functions in February 2002,
largely by contracting with private-sector security providers; however, the TSA
is required to have its own federal employees performing these functions by
November 2002. Less than 5.0% of Worldwide's 2001 revenues were derived from
security check-point screening services, which are currently contracted with the
TSA.

2001 VS. 2000

Net loss for the year ended December 31, 2001 increased 533.3%, to $72.2
million, compared to a net loss of $11.4 million in 2000. Loss from continuing
operations was $51.6 million in 2001, compared to income from continuing
operations of $4.8 million in 2000. The 2001 results are affected by several
items, which management believes are not representative of the Company's ongoing
operations. These items include a $40.0 million goodwill impairment charge, a
$1.9 million non-cash stock compensation charge, a $4.7 million charge to bad
debt and a $0.8 million charge associated with claims from the Miami-Dade
International Airport audit. In addition, the terrorist attacks on September 11,
2001 resulted in an undetermined amount of lost revenue, due to the immediate
closure of all U.S. airports from September 11, 2001 to September 13, 2001 and
the significantly lower flight frequencies during the following weeks.

After the events of September 11, 2001 we reassessed our allowance for doubtful
accounts, increasing the provision by $4.7 million to account for the increased
risk of non-payment due to economic conditions in the airline industry and to
apply a reserve against older balances that had not been collected. In the
fourth quarter of 2001 we performed an impairment test of our goodwill and
recorded a $40.0 million charge as a result of decreases in the Company's fair
value after the terrorists' attacks.

During 2000 the Aviation Department of Miami-Dade County International Airport
performed an audit of our Gross Revenues calculation, which is used in
determining the airport fees paid under our general aeronautical services
permit. In connection with that audit the airport assessed $0.8 million in
additional airport fees. Although we contested these findings we were ultimately
unsuccessful in our attempt to overcome the airport's position and therefore
recorded the charge in 2001.

In addition to these items, insurance expense increased to $3.3 million in 2001,
compared to $1.6 million in 2000. In 2001 we experienced premium increases on a
variety of our insurance policies. These increases, totaling approximately $1.4
million, are mainly attributable to coverage enhancements and a general
hardening of the insurance market. In addition, the premium for our war-risk
insurance policy increased approximately $1.3 million as a result of the
September 11 events.

2000 VS. 1999

Net loss for the year ended December 31, 2000 increased 369.6% to $11.4 million,
compared to a net loss of $2.4 million in 1999. Income from continuing
operations was $4.8 million in 2000, compared to $9.4 million in 1999. Both the
net loss and income from continuing operations in 2000 reflect a $5.4 million
restructuring charge. In addition, depreciation and amortization expense
increased $7.3 million in 2000, compared to 1999, primarily due to increased
goodwill amortization from the acquisitions of MAS and Oxford.

10

STATEMENT OF OPERATIONS ANALYSIS

2001 VS. 2000

Revenues

Total revenues increased $1.5 million, or 0.4%, to $344.0 million in 2001,
compared to $342.5 million in 2000. Approximately $1.4 million of this increase
is attributable to the inclusion of Oxford's operations for the full
twelve-month period of 2001, compared with only nine months in 2000. Increases
in 2001 revenues relating to new contracts in the U.S., Europe and Hong Kong
were fully offset by decreases in revenues from terminated contracts and as a
result of the terrorist attacks of September 11.

Salaries, Wages and Benefits

Total salaries, wages and benefits increased $9.7 million, or 4.5%, to $227.7
million in 2001, compared to $218.0 million in 2000. In 2001, we recorded a $1.9
million non-cash stock compensation charge in connection with the 2001
acquisition. No stock compensation expense was charged in 2000. Approximately
$0.5 million of the remaining increase is attributable to additional salary
expense due to the inclusion of Oxford for the full twelve-month period in 2001,
compared with only nine months in 2000. In addition, 2001 salaries and wages
increased $1.5 million due to union wage increases and $1.4 million due to other
salary increases. In addition to these 2001 salary and wage increases, we
experienced increased costs related to our workers compensation and health
benefits programs. Other changes in salaries, wages and benefits were caused by
the increases and decreases in revenues, as discussed above. These net increases
were partially offset by a $2.8 million decrease in overtime.

Materials, Supplies and Services

Total materials, supplies and services increased $11.0 million, or 26.6%, to
$52.4 million in 2001, compared to $41.4 million in 2000. Approximately $7.1
million of this increase relates to additional cost of goods sold associated
with the new American cargo contracts. Other changes in materials, supplies and
services were caused by the increases and decreases in revenues, as discussed
above.

Equipment and Facilities Rental

Total equipment and facilities rental increased $2.9 million, or 13.1%, to $25.0
million in 2001, compared to $22.1 million in 2000. This increase is primarily
attributable to increased facility rentals related to the new cargo operations
in the United Kingdom and the new baggage handling operations in Hong Kong.
Other changes in equipment and facilities rental were caused by changes in
revenues, as discussed above. In connection with the restructuring plan
announced in June 2000, we vacated certain facilities and set up a

11

restructuring reserve. Lease payments associated with these vacated facilities
were charged against this reserve in 2001, partially offsetting the increase in
expense.

Restructuring

In June 2000 we announced a restructuring plan to realign Worldwide's
organization, reduce overhead costs and eliminate excess and duplicative
facilities. For the year ended December 31, 2000 we recorded a total of $5.4
million in restructuring charges. In 2001, we made several downward revisions to
our restructuring estimates to match the actual costs incurred. As a result, we
reversed $.4 million of the reserve in the second quarter of 2001.

In connection with the 2001 acquisition we announced and began implementing a
plan to restructure our operations in an effort to respond to the current
economic environment. This restructuring plan resulted in workforce
reductions mainly at corporate headquarters. As a result, a $2.3 million
restructuring accrual was established as part of the purchase price allocation.

The following table summarizes the activity in the restructuring accrual during
2001:

(a) Business restructuring costs primarily relate to other costs of workforce
reductions.

Goodwill Impairment Charge

In connection with the 2001 acquisition we recorded goodwill of $210.9 million,
which represented the difference between the purchase price and the fair value
of net assets acquired on the date of the transaction. The purchase price was
established prior to the events of September 11, 2001.

In the fourth quarter of 2001 we performed an assessment of the carrying value
of our goodwill in accordance with Statement No. 121, Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, due
to the significant slowdown of the airline industry after September 11. As a
result of this assessment we recorded a goodwill impairment charge of $40.0
million in the fourth quarter to write down the value of our goodwill.

12

2000 VS. 1999

Revenues

Total revenues increased $64.2 million, or 23.1%, to $342.5 million in 2000,
compared to $278.3 million in 1999. The acquisitions of MAS and Aerolink in
August 1999 and Oxford in April 2000 accounted for approximately $54.8 million
of this increase. Revenues increased $9.4 million, or 3.4% as a result of price
increases on existing contracts and new contracts, net of terminated contracts.

Salaries, Wages and Benefits

Salaries, wages and benefits increased $37.2 million, or 20.6%, to $218.0
million in 2000, compared to $180.8 million in 1999. The primary reason for the
increase was an increase in the number of employees required to support the
additional new business during 1999, including $33.2 million additional salaries
expense as a result of the MAS, Aerolink, and Oxford acquisitions. Additional
staffing for new contracts added $5.6 million, and cost increased for wages and
benefits for existing employer added another $5.9 million, or 3%.

Material, Supplies and Services

Materials, supplies and services increased $8.4 million, or 25.5 %, to $41.4
million in 2000, compared to $33.0 million in 1999. This increase was primarily
due to the acquisitions of MAS, Aerolink, and Oxford.

Equipment and facilities rental

Equipment and facilities rental increased $4.9 million, or 28.5%, to $22.1
million in 2000, compared to $17.2 million in 1999. Approximately $3.0 million
of this increase is attributable to additional rents associated with facility
leases assumed in the acquisitions of MAS, Aerolink and Oxford. The remaining
$1.1 million is associated with facilities expansion for new customers.

Depreciation and amortization

Depreciation and amortization increased $7.4 million, or 69.2 %, to $18.1
million in 2000, compared to $10.7 million in 1999. The acquisitions of AMRS,
MAS, Aerolink, and Oxford resulted in additional goodwill amortization of $3.2
million and $2.6 million of depreciation expense over the prior year. The
remaining difference was due to depreciation on new equipment purchases.

13

Other operating expenses

Other operating expenses increased $7.8 million, or 31.3%, to $32.7 million in
2000, compared to $24.9 million in 1999. The acquisitions of MAS, Aerolink, and
Oxford increased other operating expenses by approximately $3.0 million. The
additional increase of $2.1 million is primarily due to general and
administrative expenses incurred by Worldwide, which were previously allocated
as indicated below.

General and administrative allocated expenses

General and administrative allocated expenses decreased $2.3 million, or 100%,
to $0.0 million in 2000, compared to $2.3 million in 1999. The reason for the
decrease was the elimination of the corporate overhead charge allocated to AMRS
from AMR. This allocation was included in the quarter ended March 31, 1999, but
was eliminated at the time of the Castle Harlan acquisition. In place of this
overhead allocation, we now incur direct expenses including salaries, benefits,
legal expenses, data processing charges, rent and other headquarters costs.

Restructuring

In June 2000 we announced a restructuring plan to realign our organization,
reduce overhead costs and eliminate excess and duplicative facilities. For the
year ended December 31, 2000 we had recorded a total of $5.4 million in
restructuring charges. There were no restructuring costs charged to operations
in 1999.

CONTINGENCIES

Environmental

In two United States locations and in Hong Kong, we manage fueling operations.
In most of our locations, we maintain equipment for our operations. Both of
these activities require us to store and dispose of various petroleum products.
The EPA and other state and local environmental agencies regulate activities
related to the storage, disposal and remediation of petroleum-based products
used in the airline industry. As a result, we are required to comply with a
variety of international, federal, state and local laws and regulations relating
to environmental protection. In addition, we are required to comply with various
Airport Authority Storm Water Pollution Prevention Plans or permits and train
employees on preserving clean water according to the plans or permits. Although
we believe we are in compliance with all related environmental laws and
regulations, engaging in these activities may result in obligations to remove or
mitigate the effects on the environment of the storage or disposal of petroleum
substances.

In connection with the Castle Harlan acquisition, Worldwide obtained
environmental indemnities from AMR, subject to deductibles, for all
environmental liabilities that relate to periods prior to the Castle Harlan
acquisition. We also received environmental indemnities from the sellers of MAS,
Aerolink and Oxford.

Miami-Dade County is currently investigating various environmental conditions at
the Miami International Airport. During the second quarter of 2001 the County
filed a lawsuit against several companies operating within the airport.
Worldwide was not directly named in this lawsuit, however we were named as a
potential contributor. Worldwide's portion of the cleanup cost cannot be
reasonably estimated due to various factors, including the unknown extent of the
remedial actions that may be required and the proportion of costs that will
ultimately be assigned to Worldwide. Other than the Miami-Dade action, we are
not aware of any other significant environmental issues or related actions.
However, future events, such as the discovery of unknown contamination, future
spills and releases, compliance with more stringent regulations, more vigorous
enforcement policies by regulatory agencies or stricter interpretations of
existing regulations could cause operating constraints or require significant
expenditures for remedial action or to comply with evolving environmental
regulations. While Worldwide carries insurance that covers many of these risks,
these or other events relating to compliance with environmental regulations
could materially adversely affect our business.

AMR Earn-Out

In connection with the Castle Harlan acquisition, we are contingently obligated
to pay AMR an additional amount if revenues from AMR exceed specific amounts
over a ten-year period from the date of the Castle Harlan acquisition.

14

If these revenue targets are met, we will pay AMR up to $10.0 million plus
accrued interest. We are not able to predict whether or not we will meet these
revenue targets.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

During 2001 the Financial Accounting Standards Board ("FASB") issued Statement
No. 141, Business Combinations, and Statement No. 142, Goodwill and Other
Intangibles Assets, effective for fiscal years beginning after December 15,
2001. Statement No. 141 prohibits the use of the pooling-of-interests method for
business combinations initiated after June 30, 2001 and includes criteria for
the recognition of intangible assets separately from goodwill. Statement No. 142
substantially changes the accounting for goodwill and other intangible assets.
Under the new rules, goodwill and intangible assets deemed to have indefinite
lives recognized after June 30, 2001 will no longer be amortized but will be
subject to impairment tests at least annually. Other intangible assets will
continue to be amortized over their estimated useful lives.

We will apply the new rules on accounting for goodwill and other intangible
assets, other than amounts recognized in connection with the 2001 acquisition
beginning in the first quarter of 2002. Under the new rules we will perform the
first required impairment test of goodwill during fiscal 2002. We have not yet
determined the effect of this test and the impact of this statement on the
results of operations and the financial condition of Worldwide. However,
application of the non-amortization provisions of Statement No. 142 is estimated
to result in a decrease in the amortization of goodwill of approximately $8.5
million per year, based on the goodwill balance at December 31, 2001.

During 2001 the FASB issued Statement No. 143, Accounting for Asset Retirement
Obligations and Statement No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets. Statement No. 143 requires recognizing retirement obligations
as liabilities rather than as contra-assets and generally recognizing them
earlier than currently required. These retirement obligations will be added to
the carrying amount of the long-lived asset. Assets with a corresponding
retirement obligation will be displayed on a gross rather than on a net basis.
Initial adoption of Statement No. 143 is required for Worldwide's 2003 reporting
period with a cumulative adjustment for any liability necessary. Statement No.
144 defines one accounting model to be used for long-lived assets to be disposed
of by sale, whether previously held and used or newly acquired, and broadens the
presentation of discontinued operations to include more disposal transactions.
Statement No. 144 is required to be adopted on January 1, 2002. We are studying
the impact that these new standards will have on our consolidated financial
statements and currently do not expect the adoption of these new standards to
have a significant effect on our results of operations or financial position.

SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the amounts reported in the consolidated
financial statements and accompanying notes. We believe the following critical
accounting policies require the most significant estimates and judgments.

As a result of the 2001 acquisition we adjusted our assets and liabilities to
their estimated fair values as of October 5, 2001, as required by the purchase
method of accounting. These estimates were based on the nature of our assets and
liabilities, as well as our understanding of current market conditions. Although
the final fair value allocations are not yet complete and are subject to change,
we recorded goodwill of $210.9 million, which represented the difference between
the purchase price and the initial estimate of the fair value of net assets
acquired on the date of the transaction.

In the fourth quarter of 2001 we performed an assessment of the carrying value
of our goodwill in accordance with FASB Statement No. 121, Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, due
to the significant slowdown of the airline industry after September 11. As a
result, we recorded a goodwill impairment charge of $40 million.

We periodically review the estimated useful lives of our depreciable assets
based on factors including historical experience, the expected beneficial
service period of the asset, the quality and durability of the asset and our
maintenance policy.

15

The following is a listing of other items that are inherently uncertain and
require subjective and complex judgments:

o Health and medical liability

o Workers compensation liability

o Allowance for doubtful accounts

o Provision for legal reserves

OTHER

Change of Control Offer

On October 5, 2001 Vinci Airports US Inc. acquired all of the capital stock of
WFS Holdings, Inc., which is the parent of Worldwide. Under the terms of the
indenture governing the Senior Notes, we commenced a change of control offer on
October 24, 2001 to repurchase the Senior Notes at 101% of their par value, plus
accrued but unpaid interest. As of November 23, 2001, the date on which such
offer expired, $5.5 million aggregate principal amount of Senior Notes had been
tendered to Worldwide.

On November 26, 2001 we commenced a supplemental change of control offer to
repurchase our Senior Notes, also at 101% of their par value plus accrued but
unpaid interest. This offer expired on December 11, 2001, and no additional
Notes were tendered.

Effects of Inflation

Inflation has not had a significant effect on our operations. However, in the
event of increases in inflation, particularly in employment costs, we could
experience sudden and significant increases in operating costs. Over the
short-term, we may be unable to completely pass wage increases on to our
customers.

LIQUIDITY AND CAPITAL RESOURCES

Until the 2001 acquisition the primary sources of liquidity were cash flows from
operations and borrowings under the Senior Secured Credit Facility. At the
change of control the Senior Secured Credit Facility was terminated and fully
repaid for $46.5 million. Certain other short-term borrowings totaling
approximately $2.0 million were repaid to Castle Harlan. From the
change of control date, the primary sources of liquidity are cash flows from
operations and borrowings from our parent company under an intercompany demand
loan.

An intercompany demand loan from Vinci Airports US Inc. was established to
provide short-term liquidity until we can acquire other funding. The interest
rate on this loan is based on the one-month LIBOR rate plus 0.75% and is payable
upon demand. At December 31, 2001 the outstanding balance was $72.1 million,
which was primarily used to fund operations, repay the Senior Secured Credit
Facility, repay Castle Harlan's short-term loan, repurchase the 12.25% Senior
Notes tendered during the repurchase offer, and fund other change of control
costs.

In the year ended December 31, 2001, $17.1 million of net cash was used in
operations and $71.2 million was borrowed under the intercompany demand loan.
Our primary uses of cash include capital expenditures of approximately $16.0
million, repayment of Senior Secured Credit Facility of $46.5 million, repayment
of short-term borrowings from Castle Harlan of $2.0 million, repurchase of
Senior Notes for $5.5 million and acquisition costs of $2.5 million related to
an earn-out provision associated with the purchase of Oxford. The $67.7 million
decrease in net working capital in 2001 primarily resulted from higher accrued
liabilities. At December 31, 2001 we had $5.3 million cash and cash equivalents.

In connection with the change of control we recognized an equity contribution of
$75.5 million and goodwill totaling $210.9 million. We also offered to
repurchase the Senior Notes at 101% of the aggregate principal amount, plus
accrued interest as required by the Indenture. Notes with an aggregate principal
amount of $5.5 million of were repurchased under this offer.

As of December 31, 2001 we had $131.1 million of long-term debt of which $1.4
million is due within one year. Our long-term debt consists of Senior Notes with
a face value of $124.5 million and a carrying value of $125.8 million, $5.1
million in capital leases and $0.2 million in other international debt. The
Senior Notes are due 2007

16

and interest is payable semi-annually on February 15 and August 15. Based on the
Senior Notes outstanding at December 31, 2001 our annual interest payments are
approximately $15.3 million. The capital leases of $5.1 million primarily relate
to long-term facility leases in Europe and several other leases assumed in the
acquisition of MAS, Aerolink and Oxford.

In addition to our debt service obligation, our principal liquidity needs are
for working capital and capital expenditures. In 2001 we spent $16.0 million on
capital expenditures, primarily for ground handling equipment to support our
business. However, this amount includes approximately $3.9 million to implement
the payroll module of SAP. In 2002 we expect a significant decrease in our
capital expenditures mainly attributable to the declining economic conditions of
the airline industry and the completion of several core computer projects in
2001.

Our working capital requirements, capital expenditures and scheduled debt
service requirements for the next twelve months will be provided through a
combination of cash flow generated from operations and funds available under
available funding.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign currency

We are exposed to the effect of foreign exchange rate fluctuations between the
U.S. dollar and the currencies related to our foreign operations. Our largest
exposures come from the Canadian dollar, the Euro, the Hong Kong dollar and the
British pound. Our European operations are substantially self-contained in that
the majority of the revenues and related expenses are incurred in those
currencies. However, we are exposed to currency fluctuations with respect to
financing costs, which are primarily incurred in the United States and
denominated in U.S. dollars and to investments and profits denominated in
foreign currencies that need to be repatriated.

Interest

Our earnings are also affected by changes in interest rates, due to the impact
those changes may have on our interest expense from variable-rate debt
instruments. Currently, we have an intercompany demand loan to provide
short-term liquidity until we can acquire other funding. At December 31, 2001,
the outstanding balance on this loan was $72.1 million and carries an interest
rate based on the one-month LIBOR rate plus 0.75%. Based on this balance, a .25%
change in LIBOR would cause annual interest expense to increase or decrease by
approximately $180,000.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required by Item 8 of Part II is incorporated herein by
reference to the Consolidated Financial Statements filed with this report, see
Item 14 of Part IV.

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

On December 17, 2001 the Board of Directors of Worldwide dismissed Ernst & Young
LLP and concurrently appointed Deloitte & Touche LLP as Worldwide's independent
accountants to audit its consolidated financial statements for the year ended
December 31, 2001. Deloitte & Touche LLP are Vinci Airports US Inc.'s auditors
and were selected in an effort to maintain greater accountability and
consistency.

17

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The following table contains the name, age and position of each person who is an
executive officer or director of our company. Each director also serves as a
director of our parent.

We currently have three authorized directors, each of whom will serve until a
successor is elected or until any of them resigns or is removed.

Jean-Francois Gouedard joined Worldwide as acting President and Chief Operating
Officer on October 5, 2001. From early 1999 through October 5, 2001 Mr. Gouedard
served as the Deputy Managing Director of the Group Freyssinet International, a
world leader in Specialist Engineering and a subsidiary of Vinci S.A. From
September 1995 through the end of 1998 Mr. Gouedard served as Chief Financial
Officer of this same company.

Jeanette H. Quay joined Worldwide in January 2002 and is serving as Senior Vice
President, General Counsel and Secretary. From June 2000 until joining
Worldwide, Ms. Quay was of counsel to the law firm of Spain & Hastings. Ms. Quay
was with Global Industrial Technologies, Inc., a NYSE diversified manufacturing
company from January 1996 through 1999, serving as Vice President, General
Counsel and Secretary of Global from 1998 through 1999. She was an independent
consultant to Global from January 2000 until June 2000. Ms. Quay has been
continuously licensed to practice law in the state of Texas since May 1979.

James Enright joined Worldwide in September 1991 as Vice President of Human
Resources. In April 1999 Mr. Enright was named Senior Vice President, Human
Resources. Prior to 1991 Mr. Enright served in a variety of management positions
with American.

Olivier Bijaoui joined Worldwide in January 1996 and served as Senior Vice
President for Europe from May 1996 until he was named Executive Vice President,
Cargo & International in July 2001. Before joining Worldwide, Mr. Bijaoui served
as President of SFS, a cargo handling company built by Mr. Bijaoui and his
father. SFS was acquired by AMRS, the predecessor company to Worldwide. From
1980 until his promotion to President of SFS, Mr. Bijaoui served as Managing
Director of SFS.

Jeffrey Kinsella joined Worldwide as Vice President of Operations for MAS, when
we acquired MAS in August 1999. In January 2001 Mr. Kinsella was named Senior
Vice President of Operations for North America and was named Executive Vice
President, North American Operations in July 2001. Prior to joining Worldwide,
Mr. Kinsella served as the Vice President of Operations for MAS and has over
twenty years experience in the aviation industry.

Anthony P. Dalia joined Worldwide in April of 2000 as the President of Oxford.
On November 1, 2000 Mr. Dalia was named Senior Vice President of Airport
Technical Services and in July 2001 Mr. Dalia was named Executive Vice
President, Technical Services. Prior to joining Worldwide, Mr. Dalia served as
the President of Oxford.

Jean-Pierre Marchand-Arpoume has served as a director of Worldwide since October
2001. Mr. Marchand-Arpoume was the Chairman and Chief Executive Officer of the
Group Freyssinet International, a subsidiary of Vinci

18

SA from 1993 until November 2001. In November 2001 he was appointed Chairman &
Chief Executive Officer of Vinci Airports S.A., the French parent of Vinci
Airports US Inc.

Sami Chahda has served as a director of Worldwide since October 2001. Mr. Chahda
is the Managing Director of Vinci Airports S.A., the French parent of Vinci
Airports US Inc. Previously, Mr. Chahda served as the International Chief
Executive Officer of the Paint & Adhesive Division of Total Petroleum &
Chemicals.

ITEM 11. EXECUTIVE COMPENSATION

The following table indicates the 2001, 2000 and 1999 compensation paid to our
President and Chief Operating Officer, our two former Chief Executive Officers
and our three other most highly compensated officers. The table does not include
discretionary bonuses, as none were accrued or paid in 2001 or 2000. The
compensation committee of the board of directors may, in the future, in its
discretion increase the salary or bonus of any of the current officers. Selected
terms of their employment agreements are summarized below.

(1) Hired on June 1, 2000 and terminated December 8, 2001.

(2) Bonus based on completion of the 2001 acquisition.

19

(3) Automobile allowance.

(4) Whole life insurance policy premium $20,127, company match for the deferred
compensation plan $9,873 and settlement payments of $550,905.

(5) This amount includes director's fees of $12,500 Mr. Stanius received in
2000, prior to his hire date; company match for the deferred compensation
plan of $8,162 and whole life insurance policy premium of $7,070.

(6) Resigned from Worldwide in May 2001 and received salary compensation
through December 24, 2001.

(7) Consists of $5,000 of country club fees and a $7,500 automobile allowance.

(8) Company match for the deferred compensation plan

(9) Consists of $6,000 of country club fees and a $7,500 automobile allowance.

(10) Consists of a $13,000 country club membership entrance fee and $6,000 of
country club membership fees.

(11) Hired on June 1, 2000 and left Worldwide on October 5, 2001.

(12) Consists of $4,800 automobile allowance and $2,500 country club allowance.

(13) Company match of $4,875 for the deferred compensation plan and a lump sum
severance payment in connection with the change of control.

(14) Consists of signing bonus of $25,000 and company match for deferred
compensation plan of $9,000.

(15) Left Worldwide on December 18, 2001.

(16) First severance payment of $5,770 and a company match for the deferred
compensation plan of $3,696.

(17) Company match for Oxford's 401(k) plan or $1,125

(18) In 1999, our parent executed a stock option plan to grant options and
non-qualified stock options to executives, key employees, consultants and
directors of our parent, our company and subsidiaries. These options
allowed the holder to acquire shares of non-voting common stock of our
parent. Upon the 2001 acquisition, all of the outstanding options vested
and were exercised.

Employment Agreements and Arrangements

Jean-Francois Gouedard. On February 1, 2002 we entered into an employment
agreement with Mr. Gouedard. The agreement provides for an annual base salary of
$144,000, after federal and state imposed deductions. The agreement also
provides for an annual bonus of up to $100,000, based on certain performance
targets to be established annually by the Compensation Committee and a
guaranteed bonus of $40,000 in 2002. Other provisions of the employment
agreement provide for the use of a company car, tuition reimbursement for Mr.
Gouedard's dependents to attend the Dallas International School and a
comprehensive relocation package. If Mr. Gouedard terminates his employment for
good reason or is terminated by Worldwide for any reason other than for cause,
Mr. Gouedard is entitled to receive, as severance, payment of his base salary,
plus a pro-rated annual bonus, for a period of twelve months. In the event of a
change in control, Mr. Gouedard has the right, with a ten-day written notice to
Worldwide, to terminate his employment and receive his base salary, plus a
pro-rated annual bonus, for a period of twelve months.

Bradley G. Stanius. We had an employment agreement with Bradley G. Stanius for
him to serve as our Executive Chairman. Mr. Stanius was to be paid an annual
base salary of $400,000 per year and a discretionary cash bonus, subject to
Worldwide meeting certain performance criteria, as determined by the
Compensation Committee of Worldwide. On October 6, 2001 Mr. Stanius received a
new employment agreement. Based on this new agreement Mr. Stanius was to be paid
an annual base salary of $445,000. On December 8, 2001 a severance and
settlement agreement was reached between Mr. Stanius and Worldwide. This
agreement pays Mr. Stanius over $550,000 in both direct and indirect
compensation. Additionally, the agreement states that Mr. Stanius will be made
whole for the sale of his house if the sale price is less than the purchase
price. Mr. Stanius also has a consulting agreement with Worldwide for one year.
This agreement will pay him a $100,000 retainer plus $1,500 for each day service
is provided. Mr. Stanius resigned from Worldwide on December 8, 2001.

Peter A. Pappas. We had an employment agreement with Peter A. Pappas for him to
serve as our Chief Executive Officer. In February 2001 Mr. Pappas entered into a
revised employment agreement. This agreement provided for a base salary of
$320,000, an annual bonus of $160,000 if we met certain performance criteria in
2001, a monthly car allowance and reimbursement of club membership. Mr. Pappas
resigned from Worldwide in May of 2001.

Jeffrey Kinsella. As of March 31, 2002 no employment agreement exists between
Worldwide and Mr. Kinsella.

James Enright. We have an employment agreement with James Enright for him to
serve as our Senior Vice President, Human Resources. Mr. Enright is to be paid
an annual salary of $150,000 per year and a minimum annual

20

bonus of $45,000. The term of his agreement extends to March 31, 2003. Mr.
Enright's employment agreement provides that if he dies, becomes disabled,
terminates his employment with good reason or if Worldwide terminates his
employment without cause, he will be entitled to receive a severance payment
equal to his base salary for the remainder of his employment term.

Anthony P. Dalia. We have an employment agreement with Anthony P. Dalia to serve
as Executive Vice President of Airport Technical Services. This agreement
provides for an annual base salary of $200,000 and is in effect until March 31,
2002. The agreement also provides for annual bonus of up to 100% of his salary,
if Oxford meets certain performance targets. Under this agreement, Mr. Dalia is
entitled to severance equal to his base salary plus his accrued annual bonus for
the remainder of his term.

David F. Chavenson. We had an employment agreement with David F. Chavenson for
him to serve as our Senior Vice President and Chief Financial Officer. Mr.
Chavenson was to be paid an annual base salary of $200,000 per year and a
discretionary an annual cash bonus of up to 50% of his base salary, as
determined by the Compensation Committee of Worldwide. Mr. Chavenson resigned
from Worldwide on October 5, 2001.

Jonathan S. Weaver. We had an employment agreement with Jonathan S. Weaver for
him to serve as Senior Vice President, Planning and Corporate Development. Mr.
Weaver was to be paid an annual base salary of $150,000 and a discretionary cash
bonus of up to 50% of his base salary, as determined by the Compensation
Committee of Worldwide. Mr. Weaver resigned from Worldwide on December 18, 2001.

All of the employment agreements described above provide that each of the
executives will receive life, disability and health insurance benefits for the
period of time that they receive payments from Worldwide after their termination
of employment.

Worldwide has entered into non-competition and confidentiality agreements with
Messrs. Bijaoui, Dalia, Enright, Gouedard, Pappas and Stanius that prohibits
these executives from competing with or soliciting employees or customers of our
parent, Worldwide or any of our subsidiaries. These limitations last for an
average of two years from the termination of employment if the executive leaves
Worldwide without good reason or if he is terminated for cause. If the executive
leaves our employment with good reason or is terminated without cause, the
limitations on competition and solicitation will last for the remaining term of
the employment agreement or eighteen months from the time of termination,
whichever is longer.

Committees of the Board of Directors

Our Board of Directors presently has two committees, a Compensation Committee
and an Audit Committee. Both the Compensation Committee and the Audit Committee
are comprised of Messrs. Marchand-Arpoume and Chahda. The Compensation Committee
establishes remuneration levels for some of our officers and performs other
functions as may be delegated to it under our various benefit and executive
compensation programs. The Audit Committee selects and engages the independent
public accountants to audit our annual financial statements. The Audit Committee
also reviews and approves the planned scope of the annual audit.

The Board of Directors may from time to time establish other committees to
facilitate our management.

Compensation Committee Interlocks and Insider Participation

No member of the Compensation Committee is a former or current officer or
employee of Worldwide or any of its subsidiaries. Except as set forth below,
there are no relationships among Worldwide's executive officers, members of the
Compensation Committee or entities whose executives serve on the Board of
Directors or the Compensation Committee that require disclosure under applicable
Securities and Exchange Commission regulations.

Compensation of Directors

Messrs. Marchand-Arpoume and Chahda, directors who are not otherwise associated
with Worldwide or its affiliates, but who are officers of Vinci Airports S.A.,
the parent of Vinci Airports US Inc., do not receive compensation for serving as
a director. Mr. Gouedard, an executive officer of Worldwide, does not receive
compensation for serving as a director.

21

Limitations on Officers' and Directors' Liability

Our Certificate of Incorporation indemnifies our officers and directors to the
fullest extent permitted by the Delaware General Corporation Law ("DGCL"). Under
Section 145 of the DGCL, a corporation may indemnify its directors, officers,
employees and agents and its former directors, officers, employees and agents
and those who serve, at the corporation's request, in such capacities with
another enterprise, against expenses, including attorneys' fees, as well as
judgments, fines and settlements in nonderivative lawsuits, actually and
reasonably incurred in connection with the defense of any action, suit or
proceeding in which they or any of them were or are made parties or are
threatened to be made parties by reason of their serving or having served in
that capacity. The DGCL provides, however, that the person must have acted in
good faith and in a manner that he or she reasonably believed to be in, or not
opposed to, the best interests of the corporation and, in the case of a criminal
action, he or she must have had no reasonable cause to believe his or her
conduct was unlawful. In addition, the DGCL does not permit indemnification in
an action or suit by or in the right of the corporation where he or she has been
adjudged liable to the corporation, unless, and only to the extent that, a court
determines that he or she fairly and reasonably is entitled to indemnity for
costs the court deems proper in light of liability adjudication. Indemnification
is mandatory to the extent a claim, issue or matter has been successfully
defended. The Certificate of Incorporation and the DGCL also prohibit
limitations on officer or director liability for acts or omissions, which
resulted in a violation of a statute prohibiting dividend declarations, payments
to stockholders after dissolution and particular types of loans. The effect of
these provisions is to eliminate the rights of our company and our stockholders,
through stockholders' derivative suits on behalf of our company, to recover
monetary damages against an officer or director for breach of a fiduciary duty
as an officer or director, except in the situations described above.

Insofar as indemnification by Worldwide for liabilities arising under the
Securities Act may be permitted to directors or officers of our company pursuant
to the foregoing provisions, we have been informed that, in the opinion of the
SEC, this indemnification is against public policy as expressed in the
Securities Act and is therefore unenforceable.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Worldwide is a wholly owned subsidiary of WFS Holdings, Inc., which is a wholly
owned subsidiary of Vinci Airports US Inc.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On March 31, 1999 we entered into a Management Agreement with Castle Harlan,
Inc., an affiliate of our parent at that time. Under this Agreement, Castle
Harlan provided Worldwide with business and organizational strategies as well as
financial, advisory and investment banking services. In return, we agreed to pay
a management fee at the annual rate of $1.25 million for the period from July 1,
2000 through December 31, 2002 and $2.0 million from January 1, 2003 through
December 31, 2005. This agreement was terminated in October 2001, upon the
change of control on October 5, 2001.

On September 7, 2001 and September 20, 2001, we borrowed $1.0 million on each
date from Castle Harlan to meet certain liquidity needs. This loan was unsecured
with an imputed interest rate of 8.0%. The entire loan, plus accrued interest,
was repaid on October 5, 2001, in a series of transactions related to the 2001
acquisition.

On October 5, 2001 we established an intercompany demand loan from Vinci
Airports US Inc. to provide short-term liquidity until we can acquire other
funding. The interest rate on this loan is based on the one-month LIBOR rate
plus 0.75% and is payable upon demand. At December 31, 2001 the outstanding
balance was $72.1 million, which was primarily used to fund operations, purchase
a $1.3 million war-risk insurance policy, repay the $46.5 million outstanding on
the Senior Secured Credit Facility, repay the $2.0 million short-term loan from
Castle Harlan and to repurchase $5.5 million of our Senior Notes. This loan
consists of $71.2 million of principle, $0.5 million of interest and $0.4
million of fees related to a consulting arrangement with Vinci Airports US Inc.

In conjunction with the purchase of Worldwide, Vinci Airports US Inc. also
purchased Airline Container Acquisition Corp. ("ACAC") and its subsidiaries.
Worldwide has no ownership in ACAC or any of its subsidiaries, therefore, ACAC's
financial information is not included in the consolidated financial statements
of Worldwide.

In 1999 we issued $130.0 million of Senior Notes. Interest payments are due
semi-annually, on February 15 and

22

August 15. As of December 31, 2001 Vinci Airports US Inc. and ACAC had purchased
$27.4 million and $10.0 million, respectively, of the Senior Notes on the open
market. ACAC purchased the notes in the first quarter of 2001 and received a
semi-annual interest payment of $0.6 million on August 15, 2001. Vinci Airports
US Inc. purchased $5.0 million of notes in October 2001 and another $22.4
million of notes in December 2001. On February 15, 2002 Vinci Airports US Inc.
and ACAC received an interest payment of $1.4 million and $0.6 million,
respectively.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a) 1. Financial Statements.

The financial statements listed in the accompanying Index to
Consolidated Financial Statements, which appears on F-1 herein are
filed as part of this Form 10-K.

2. Financial Statement Schedules.

All financial statement schedules have been omitted due to the absence
of conditions under which they are required, not significant, not
applicable or because the information is included in the financial
statements or notes thereto.

3. Exhibits.

The exhibits listed in the accompanying Exhibits Index are filed as
part of this Form 10-K. The exhibits numbered 10.17 and 10.18 are
management contracts or compensatory plans or arrangements.

(b) Reports on Form 8-K.

During the fourth quarter of 2001 we filed the following Reports on
Form 8-K:

October 9, 2001 - Form 8-K filed to report, in Item 1, Changes in
Control of Registrant and Item 5, that on October 5, 2001 Vinci
Airport, Inc. acquired all of the capital stock of WFS Holdings, Inc.,
the parent of Worldwide Flight Services, Inc.

November 26, 2001 - Form 8-K filed to report, in Item 5, that pursuant
to the terms of the indenture governing Worldwide's 12.25% Senior Notes
due 2007, we commenced a change of control offer on October 24, 2001 to
repurchase our Senior Notes at 101% of their par, plus accrued
interest. As of November 23, 2001, the date the offer expired, $5.5
million aggregate principal amount of Senior Notes had been tendered to
Worldwide. Also, on November 26, 2001, we commenced a supplemental
change of control offer to repurchase our Senior Notes, also at 101% of
their par value, plus accrued interest. This supplemental offer expired
on December 11, 2001, and no further shares were tendered.

December 20, 2001 - Form 8-K filed to report, in Item 4, that on
December 17, 2001 the Board of Directors of Worldwide Flight Services,
Inc. dismissed Ernst & Young LLP and concurrently appointed Deloitte &
Touche LLP as Worldwide's independent accountants to audit its
consolidated financial statements for the year ended December 31, 2001.

23

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, Worldwide Flight Services, Inc. has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Euless, State of Texas, on the 30th day of March 2001.
WORLDWIDE FLIGHT SERVICES, INC.

By: /s/ JEAN-FRANCOIS GOUEDARD
-------------------------------------
Jean-Francois Gouedard
President & Chief Operating Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed by the following persons in the capacities and on the dates
indicated.

24

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, Worldwide Flight Security Service Corporation has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Euless, State of Texas, on the 30th day of March 2001.

WORLDWIDE FLIGHT SECURITY
SERVICE CORPORATION

WORLDWIDE FLIGHT SERVICES, INC.

By: /s/ JEAN-FRANCOIS GOUEDARD
---------------------------------------------
Jean-Francois Gouedard
President & Chief Operating Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed by the following persons in the capacities and on the dates
indicated.

25

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, Oxford Electronics, Inc. has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas, on the 30th day of March 2001.

OXFORD ELECTRONICS, INC.

By: /s/ JEAN-FRANCOIS GOUEDARD
---------------------------------------------
Jean-Francois Gouedard
President & Chief Operating Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed by the following persons in the capacities and on the dates
indicated.

26

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

27

REPORT OF DELOITTE & TOUCHE LLP, INDEPENDENT AUDITORS

The Board of Directors and Stockholder of
Worldwide Flight Services, Inc.

We have audited the accompanying consolidated balance sheet of Worldwide Flight
Services, Inc. ("Worldwide") as of December 31, 2001, and the related
consolidated statements of operations, stockholder's equity, and cash flows for
the period from October 6, 2001 to December 31, 2001 and for the period from
January 1, 2001 to October 5, 2001. The financial statements as of December 31,
2000 and for the year ended December 31, 2000, for the period from April 1, 1999
to December 31, 1999, and for the period from January 1, 1999 to March 31, 1999
of AMR Services Corporation were audited by other auditors whose report dated
March 16, 2001 expressed an unqualified opinion on those consolidated financial
statements. These financial statements are the responsibility of Worldwide's
management. Our responsibility is to express an opinion on these 2001 financial
statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, the 2001 financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Worldwide
Flight Services, Inc. as of December 31, 2001 and the consolidated results of
its operations and cash flows for the period from October 6, 2001 to December
31, 2001 and for the period from January 1, 2001 to October 5, 2001 in
conformity with accounting principles generally accepted in the United States of
America.

DELOITTE & TOUCHE LLP

Dallas, Texas
March 29, 2002

F-1

REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

The Board of Directors and Stockholder of
Worldwide Flight Services, Inc.

We have audited the accompanying consolidated balance sheets of Worldwide
Flight Services, Inc. as of December 31, 1999 and 2000, and the related
consolidated statements of operations, stockholder's equity, and cash flows for
the nine months ended December 31, 1999 and the year ended December 31, 2000 and
the consolidated statements of operations, stockholder's equity, and cash flows
for the three months ended March 31, 1999, of AMR Services Corporation (the
"Predecessor"). These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Worldwide
Flight Services, Inc. as of December 31, 1999 and 2000, the consolidated results
of operations and cash flows for the nine months ended December 31, 1999 and the
year ended December 31, 2000, the consolidated results of operations and cash
flows for the three months ended March 31, 1999 of AMR Services Corporation in
conformity with accounting principles generally accepted in the United States.

ERNST & YOUNG LLP

Dallas, Texas
March 16, 2001

F-2

WORLDWIDE FLIGHT SERVICES, INC.

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

See accompanying notes

F-3

WORLDWIDE FLIGHT SERVICES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)

See accompanying notes

F-4

WORLDWIDE FLIGHT SERVICES, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY
(IN THOUSANDS)

See accompanying notes

F-5

WORLDWIDE FLIGHT SERVICES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

See accompanying notes.

F-6

WORLDWIDE FLIGHT SERVICES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. BUSINESS AND BASIS OF PRESENTATION

Business

Worldwide is an independent provider of ground services which operates in four
separate areas: cargo handling, ramp services, passenger services and technical
services. Cargo handling activities includes the loading and unloading of cargo
aircraft, the build-up and breakdown of cargo, freight management, and other
services. Ramp services include loading and unloading, aircraft marshaling,
aircraft pushback, aircraft de-icing, cabin cleaning, aircraft fueling and
providing heating, air-conditioning, lavatory and water services. Passenger
services includes passenger ticketing, curbside and ticket counter check-in
boarding services, baggage claim and other services for passengers. Technical
services include maintenance and repairs to jet bridges, baggage conveyors and
ground equipment, in addition to other services.

Worldwide operates in airports around the world, primarily in New York City,
Dallas, Miami, Pittsburgh, Paris, France and Hong Kong. International operations
are generally organized as either foreign branches or separately incorporated
subsidiaries.

Basis of Presentation

Worldwide was incorporated in Delaware on December 12, 1983 as AMR Services
Corporation ("AMRS" or "the Predecessor"), a subsidiary of AMR Corporation
("AMR"). On March 31, 1999 Worldwide was acquired by WFS Holdings, Inc., which
was owned by Castle Harlan Partners III, L.P. and its affiliates ("the Castle
Harlan acquisition"). Following the Castle Harlan acquisition, Worldwide changed
its name from AMR Services Corporation to Worldwide Flight Services, Inc.

The Castle Harlan acquisition was funded by an initial capital contribution by
the parent of $28.3 million and borrowings under a term debt facility and
revolving credit facility. This acquisition resulted in a new entity, as well as
a change in the basis of accounting. As a result, financial information at any
point or for any period subsequent to March 31, 1999 is not comparable to
financial information at any point or for any period prior to the Castle Harlan
acquisition.

Prior to the Castle Harlan acquisition, some subsidiaries, divisions and
branches of AMRS were sold or transferred to AMR. As a result, the accompanying
consolidated financial statements of the Predecessor have been adjusted to
exclude certain subsidiaries, divisions, or branches, in order to achieve a
consistent presentation of the entities included in the Castle Harlan
acquisition as discussed above. As a result, the financial statements presented
herein do not represent the legal entity AMRS as it existed prior to March 31,
1999, but rather represent the entity purchased from AMR. The accompanying
financial statements for periods prior to March 31, 1999 were prepared from the
historical accounting records of AMR. These financial statements included all
revenues of the Predecessor and all items of expense directly incurred and
expenses charged or allocated to it by AMR in the normal course of business.

Since March 1999, we made three significant acquisitions: on August 12, 1999, we
purchased all of the stock of MAS for approximately $63.0 million: on August 23,
1999, we purchased all of the stock of Aerolink for approximately $5.9 million,
plus an earn-out of $1.0 million, which was paid in 2000; and on April 5, 2000,
we purchased all the stock of Oxford for approximately $9.6 million, plus a
deferred payment of up to $2.5 million, which was paid out in the first quarter
of 2001.

On October 5, 2001, Vinci Airports US Inc. acquired all of the capital stock of
WFS Holdings, Inc., the parent of Worldwide Flight Services, Inc. (the "2001
acquisition"). Vinci Airports US Inc. is a wholly-owned subsidiary of Vinci
Airports S.A. Vinci Airports US Inc. made an initial equity contribution of
$75.5 million and established a short-term demand loan of $48.6 million. This
acquisition did not result in a new entity, but it did result in a change in the
basis of accounting. Consequently, the financial information at any point or for
any period subsequent to October 5, 2001 is not comparable to financial
information at any point or for any period prior to the 2001 acquisition.

F-7

Foreign operations within Worldwide are substantially self-contained in that the
majority of the revenues and related expenses are incurred in those currencies.
The financial statements of our foreign subsidiaries and branches are translated
using the current exchange rate, in accordance to SFAS No. 52, Foreign Currency
Translation. Accordingly, assets and liabilities of the foreign subsidiaries and
branches are translated at end-of-period exchange rates. Operations are
translated at the weighted average exchange rates for the period. Foreign
currency transaction gain or loss is included in other income or loss for the
period. Losses resulting from foreign currency transactions during the
three-month period ended March 31, 1999 was approximately $552,000. Since the
Castle Harlan acquisition, Worldwide has concluded that certain intercompany
foreign notes receivable represent permanent investments in those operations.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Worldwide and its
wholly owned subsidiaries. All significant intercompany balances and
transactions have been eliminated in consolidation.

Reclassifications

The presentation of certain prior period information has been reclassified to
conform with the current period presentation.

Revenue Recognition

Worldwide recognizes fees from its service contracts as service is provided. The
terms of the service contracts are generally cancelable by either party with a
ninety-day notice. Worldwide provides services to a significant number of
airlines around the world with typical payment terms of 30-60 days. Worldwide
routinely analyzes the credit worthiness of its customers and generally does not
require collateral.

Business and Concentrations of Credit Risk

For the year ended December 31, 2001, Worldwide derived approximately 20.5% of
its revenues from AMR and its affiliates, primarily American Airlines and
American Eagle (collectively "American"). As of December 31, 2001, we had
outstanding receivables from American of $14.3 million.

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the amounts reported in the consolidated
financial statements and accompanying notes. Actual results could differ from
those estimates.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash and short-term, highly liquid
investments with maturities of ninety days or less when purchased. As of
December 31, 2001 and 2000, approximately $750,000 of cash equivalents is
restricted by Worldwide's commercial banking arrangement.

Long-lived Assets and Goodwill

Worldwide reviews long-lived assets and certain identifiable intangibles for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. Recoverability of assets to
be held and used is measured by a comparison of the carrying amount of the asset
to the undiscounted future net cash flows expected to be generated by the asset.
If such assets are considered to be impaired, the impairment to be recognized

F-8

is the amount by which the carrying value of the assets exceeds the fair value.
Assets held for sale are reported at the lower of the carrying amount or fair
value less costs to sell.

Intangibles

In connection with the 2001 acquisition, we recorded goodwill of $210.9 million.
This goodwill represents the excess purchase price over the fair value
of net tangible assets and other specifically identified intangible assets as of
October 5, 2001. During the period from October 6, 2001 to December 31, 2001, we
recorded a goodwill impairment charge of $40.0 million relating to decreases in
the Company's fair value after the terrorists attacks on September 11, 2001.

During 2001, we accounted for goodwill recognized prior to June 30, 2001, in
accordance with APB Opinion No. 17, Intangible Assets, amortizing goodwill over
20 years. However, on January 1, 2002, we adopted SFAS Statement No. 142,
Goodwill and Other Intangible Assets, which significantly changed the accounting
for goodwill. Under the new rules, goodwill and intangible assets deemed to have
indefinite lives will no longer be amortized but will be subject to impairment
tests at least annually. Due to the transition rules of Statement No. 142,
goodwill recognized in connection with the 2001 acquisition was not amortized.

Financial Instruments

Worldwide has purchased an interest rate cap agreement to hedge interest on
variable-rate debt instruments. Prior to January 1, 2001, to the extent we had
borrowings outstanding on variable-rate debt instruments, the cost of the
interest rate cap is deferred and recognized as an adjustment to interest
expense on the variable rate debt. Notional amounts in excess of variable-rate
debt outstanding are marked to market with the resulting gain or loss being
included in interest expense. On January 1, 2001, the Company adopted Statement
of Financial Accounting Standard No. 133, as amended. This statement requires
financial derivatives to be recorded at fair value. Our interest rate cap
agreements had no significant fair value at January 1, 2001 or at December 31,
2001. There was no significant impact due to the adoption of this statement.

Due to the proximity of the 2001 acquisition to December 31, 2001, management
believes the reported amounts for the Company's financial instruments
approximate fair value. The Company's financial instruments consist of Cash,
Accounts Receivable, Due to Parent, and Long Term Debt. Although Vinci Airports
US Inc. purchased $22.4 million of the Company's notes during the period from
October 6, 2001 to December 31, 2001 at a price of 109.25, there is not
sufficient trading volume for management to consider that price to represent
fair value for the entire obligation.

Income Taxes

The Predecessor was included in AMR consolidated United States federal income
tax return and state income tax returns in unitary states. Under the terms of
AMR tax sharing policy, income taxes were allocated to AMR subsidiaries as if
the subsidiaries were separate taxable entities. The Predecessor computed its
provision for deferred federal income taxes using the liability method as if it
were a separate taxpayer. Under this method, deferred tax assets and liabilities
were determined based on differences between financial reporting and tax bases
of assets and liabilities and were measured using the enacted tax rates. As set
forth in the provisions of the Castle Harlan acquisition agreement, income,
franchise, ad valorem, and other tax liabilities for periods prior to March 31,
1999 remained the liability of AMR.

Worldwide is included in Holdings' consolidated United States federal income tax
return and state income tax returns in unitary states. Under the terms of
Holdings' tax sharing policy, income taxes are allocated to Holdings'
subsidiaries as if the subsidiaries were separate taxable entities. Worldwide
computes its provision for deferred federal income taxes using the liability
method as if it were a separate taxpayer. Under this method, deferred tax assets
and liabilities are determined based on differences between financial reporting
and tax bases of assets and liabilities and are measured using the enacted tax
rates.

We evaluate all deferred tax assets to determine if a valuation allowance is
needed. A valuation allowance is recorded if it is more likely than not a
deferred tax asset will not be realized. We consider future taxable income,
taxable temporary differences and tax planning strategies in the deferred tax
asset evaluation process.

Common Stock, Stock Options and Warrants

On December 31, 2001, Worldwide had 1,000 shares of issued, authorized and
outstanding $0.01 par value common stock, all owned by Holdings.

Certain employees were granted stock options under Holdings' 1999 Stock Option
Plan, which was terminated in conjunction with the 2001 acquisition. Upon the
change of control, all outstanding stock options granted under this plan vested
and were exercised. (see Note 14) In connection with the private placement of
$130 million in 12.25%

F-9

Senior Notes due 2007 (the "Senior Notes"), Holdings issued 130,000 warrants,
which entitled the holder to an aggregate of 74,750 shares of its non-voting
common stock. All of these warrants were exercised upon the change of control on
October 5, 2001. At December 31, 2001, there were no stock options or warrants
outstanding.

Some members of management were given the opportunity to purchase shares of
Holdings' common stock at the original purchase value of $3.25 per share. These
stock purchase rights were generally granted, subject to certain restrictions,
under the executive employment agreements, which were terminated upon change of
control. The new employment agreements, effective October 5, 2001, do not allow
for the purchase of stock.

Segments

Worldwide reports financial information and evaluates its operations by location
and not by its four different services categories. We do not have discrete
financial information to evaluate the operating results for each of the four
ground service categories. Although revenue can be identified for these service
categories, management cannot and does not identify expenses, profitability or
other financial information for these service categories. As a result,
management reviews operating results solely by location and thus we have
determined that it operates under one reportable segment.

Allowance for Doubtful Accounts

The following summarizes the activity in the allowance for doubtful accounts for
the following periods (in thousands):

3. ACQUISITIONS

Since Worldwide's inception, we made three significant acquisitions: on August
12, 1999, we purchased all of the stock of MAS for approximately $63.0 million;
on August 23, 1999, we purchased all of the stock of Aerolink for approximately
$5.9 million, plus an earn-out of $1.0 million, which was paid in 2000; and on
April 5, 2000, we purchased all the stock of Oxford for approximately $9.6
million, plus a deferred payment of $2.5 million, which was paid out in the
first quarter of 2001.

If the acquisitions of AMRS, MAS and Aerolink had occurred at the beginning of
the year ended December 31, 1999 and the acquisition of Oxford had occurred at
the beginning of year ended December 31, 2000, total revenues and net loss would
have been as follows (in thousands):

Acquisition of Worldwide by Vinci Airports US Inc.

On October 5, 2001 Vinci Airports US Inc. acquired all of the capital stock of
WFS Holdings Inc. Vinci Airports US Inc. is a wholly-owned subsidiary of Vinci
Airports S.A. The transaction was consummated pursuant to an Agreement and Plan
of Merger and Stock Purchase Agreement dated as of September 7, 2001 among WFS
Holdings, Inc., Airline Container Acquisition Corp., Castle Harlan Partners III,
L.P., Vinci S.A., Vinci Airports US Inc. and Vinci Merger Sub Corp. The
transaction, which was completed utilizing funds of Vinci Airports US Inc., had
a fair value to Worldwide of approximately $254.8 million, including transaction
costs. In connection with this

F-10

transaction, Worldwide recorded $210.9 million of goodwill, which represents the
difference between the allocated purchase price and the initial estimate of the
fair value of net assets acquired. Worldwide decreased the prior carrying value
of current assets by $1.2 million and total assets by $10.8 million and
increased current liabilities by $7.3 million and total liabilities by $11.2
million through its initial purchase price allocation process. Airline Container
Acquisition Corp. is a separate holding under Vinci Airports US Inc. and is
therefore not a part of Worldwide's consolidated group.

Worldwide is continuing to obtain information needed to reflect the acquired
assets and liabilities at fair values as of the date of acquisition, therefore,
the final allocation of the purchase price remains subject to change. Any
changes in purchase price allocation identified from gathering this additional
information, primarily for fixed assets and identified intangibles, may result
in changes in goodwill and the related asset, liability and deferred tax
amounts.

4. LONG-TERM DEBT

Long-term debt consists of the following as of December 31 (in millions):

In a 1999 private placement, we issued $130.0 million of Senior Notes. In
connection with the issuance of these Senior Notes, Holdings also issued 130,000
warrants, which entitled the holder to an aggregate of 74,750 shares of its
non-voting common stock. Subsequent to the private placement, the Senior Notes
were registered through a public exchange offer. On October 5, 2001, Vinci
Airports US Inc. completed its purchase of WFS Holdings, Inc. and its
subsidiaries. Under the terms of the indenture governing these notes, we
commenced a change of control offer on October 24, 2001 to repurchase our Senior
Notes at 101% of their par value, plus accrued but unpaid interest. Notes with
an aggregate face value of $5.5 million were tendered to Worldwide during the
change of control offer period. We adjusted the carrying value of $124.5 million
for our remaining Senior Notes to fair value of $125.8 million as part of the
purchase price allocation.

Worldwide's obligation under the Senior Notes is unconditionally guaranteed on a
joint and several basis by its domestic subsidiaries. (see Note 13) Worldwide is
also subject to certain covenants under the Senior Note indenture and we were in
compliance with these covenants throughout the year ended and as of December 31,
2001.

In connection with the 2001 acquisition, Vinci Airports US Inc. repaid the
outstanding balance on the Senior Secured Credit Facility and terminated the
facility. The outstanding balance at the time of repayment was $46.5 million and
was funded from the proceeds of an intercompany demand loan from Vinci Airports
US Inc.

5. RELATED PARTY TRANSACTIONS

AMRS (Predecessor)

American invested cash or alternatively provided financing for the operations of
its affiliates, including AMRS. The Predecessor received interest at the average
rate earned by American's portfolio of short-term marketable securities. The
aforementioned arrangement resulted in interest income that may not be
representative of what AMRS would have received if it were not affiliated with
AMR.

The Predecessor's transactions with AMR Services Holding Corporation, American,
and American Eagle Inc., a wholly owned subsidiary of AMR, were recorded on a
basis determined by the parties which may not be representative of the terms the
Predecessor might have negotiated with third parties. AMRS recognized revenue
from affiliates primarily related to freight handling and ramp services. General
and administrative expenses allocated and transfer priced from AMR Services
Holding Corporation and AMR and its affiliates to AMRS, including legal,
accounting, personnel, employee benefits (including post-employment benefits),
marketing, and other administrative costs aggregated $2.3 million for the
three-month period ended March 31, 1999. In addition,

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AMR and affiliates allocated approximately $0.6 million of other operating
expenses, primarily travel expenses, computer related charges, and facilities
rent for the three months ended March 31, 1999. Expenses allocated to the
Predecessor by AMR were primarily based on an allocation cost method. The method
for allocated costs was generally based on a specific measurement such as the
number of transactions processed, employee head count, square footage, etc.

Certain eligible members of management participated in a defined benefit plan
sponsored by American. AMRS was jointly and severally liable with AMR and other
members of AMR consolidated group for applicable funding and termination
liabilities, if any, of the plan. The accompanying financial statements do not
reflect the portion of the net obligation of the defined benefit plan sponsored
by AMR attributable to the employees of AMRS.

Worldwide

On March 31, 1999 we entered into a Management Agreement with Castle Harlan,
Inc., an affiliate of our parent at that time. Under this Agreement, Castle
Harlan provided Worldwide with business and organizational strategies as well as
financial, advisory and investment banking services. In return, we agreed to pay
a management fee at the annual rate of $1.25 million for the period from July 1,
2000 through December 31, 2002 and $2.0 million from January 1, 2003 through
December 31, 2005. This agreement was terminated in October 2001, in conjunction
with the change of control on October 5, 2001.

On September 7, 2001 and September 20, 2001, we borrowed $1.0 million on each
date from Castle Harlan to meet certain liquidity needs. This loan was unsecured
with an imputed interest rate of 8.0%. The entire loan, plus accrued interest,
was repaid on October 5, 2001, in a series of transactions related to the 2001
acquisition.

On October 5, 2001 we established an intercompany demand loan from Vinci
Airports US Inc. to provide short-term liquidity until we can acquire other
funding. The interest rate on this loan is based on the one-month LIBOR rate
plus 0.75% and is payable upon demand. At December 31, 2001 the outstanding
balance was $72.1 million, which was primarily used to fund operations, purchase
a $1.3 million war-risk insurance policy, repay the $46.5 million outstanding on
the Senior Secured Credit Facility, repay the $2.0 million loan from Castle
Harlan and to repurchase $5.5 million of our Senior Notes. This intercompany
loan consists of $71.2 million of principal, $0.5 million of interest and $0.4
million of fees related to a consulting arrangement with Vinci Airports US Inc.

In conjunction with the purchase of Worldwide, Vinci Airports US Inc. also
purchased Airline Container Acquisition Corp. ("ACAC") and its subsidiaries.
Worldwide has no ownership in ACAC or any of its subsidiaries, therefore, ACAC's
financial information is not included in the consolidated financial statements
of Worldwide.

In 1999 we issued $130.0 million of Senior Notes. Interest payments are due
semi-annually, on February 15 and August 15. As of December 31, 2001 Vinci
Airports US Inc. and ACAC had purchased $27.4 million and $10.0 million,
respectively, of the Senior Notes on the open market. ACAC purchased the notes
in the first quarter of 2001 and received a semi-annual interest payment of $0.6
million on August 15, 2001. Vinci Airports US Inc. purchased $5.0 million of
Notes in October 2001 and another $22.4 million of Notes in December 2001. On
February 15, 2002 Vinci Airports US Inc. and ACAC received an interest payment
of $1.4 million and $0.6 million, respectively.

6. RESTRUCTURING CHARGES

In June 2000, Worldwide's management approved a restructuring plan to realign
Worldwide's organization, reduce overhead costs and eliminate excess and
duplicative facilities. In connection with this plan, Worldwide recorded a
restructuring charge of $7.7 million in the second quarter ended June 30, 2000.
During the fourth quarter of fiscal 2000, we reversed approximately $3.3 million
of the original restructuring charge. The restructuring consists primarily of
two parts: (1) the merging and integration of operations of Worldwide with MAS
and Aerolink, and (2) other headquarters cost reduction measures.

In connection with the acquisitions of MAS and Aerolink, management initiated
plans to consolidate and integrate the operations of these two companies into
Worldwide through workforce reductions and the closure of duplicative
facilities. Amounts originally contained within the restructuring charge
included non-employee contract terminations of $1.2 million and costs associated
with contract termination for vacated facilities of $3.7 million. Other exit
costs of $0.8 million related primarily to professional fees and incidentals.
The

F-12

remaining $2.0 million in charges represented severance payments related to
staff level reductions at Worldwide's headquarters and laid-off employees in
field operations.

The original charge of $7.7 million was revised to $4.4 million in the fourth
quarter primarily due to the fact that certain exit costs related to facility
leases were lower than expected due to negotiations with the lessors. In
addition, it was determined that one facility originally scheduled to close
would remain open to service new customers.

In December 2000, we recorded a second restructuring charge of $1.0 million
relating to the termination and severance of four executives. In connection with
the restructuring costs charged in 2000, approximately $1.8 million and $2.0
million was paid in 2001 and 2000, respectively.

In 2001, we made several downward revisions to our restructuring estimates to
match the actual costs incurred. As a result, we reversed $.4 million of the
reserve in the second quarter of 2001. In connection with the 2001 acquisition
we announced and began implementing a plan to restructure our operations in an
effort to respond to the current economic climate. This restructuring plan
resulted in various workforce reductions at our corporate headquarters. As a
result, a $2.3 million restructuring accrual was established as part of the
purchase price allocation. Approximately $0.4 million was paid in 2001.

The following table summarizes the activity related to the restructuring charges
in fiscal 2001 (in thousands):

(a) Business restructuring costs primarily relate to other costs of workforce
reductions.

7. PROPERTY AND EQUIPMENT

Property and equipment are carried at cost and are depreciated using the
straight-line method over the estimated lives indicated in the table below.
Maintenance and repair costs are expensed as incurred. At the time of sale,
October 5, 2001, the fair value of fixed assets was estimated to be
approximately their net book value of $47.9 million. In accordance with the
purchase method of accounting, Worldwide is assessing the fair value of its
property and equipment. Any changes to finalized fair value would be an
adjustment to the asset, deferred taxes and goodwill.

The following table summarizes Worldwide's property and equipment at December
31, 2001 and 2000 (in thousands):

F-13

Depreciation expense totaled $3.1 million for the period from October 5, 2001 to
December 31, 2001 and $10.2 million for the period from January 1, 2001 through
October 5, 2001; $11.3 million for the year ended December 31, 2000; and $6.0
million for the period from April 1, 1999 through December 31, 1999 and $1.6
million for the period from January 1, 1999 through March 31, 1999.

8. INCOME TAXES

Income before income taxes for the three-month period ended March 31, 1999 of
the Predecessor was $0.1 million for U.S. operations and $1.1 million for
foreign operations. For U.S. operations, loss before income taxes for the
nine-month period ended December 31, 1999 and the year ended December 31, 2000
was $11.3 million and $21.4 million, respectively. For foreign operations,
income before income taxes for the nine-month period ended December 31, 1999 and
the year ended December 31, 2000 was $6.6 million and $4.9 million,
respectively. Loss before income taxes for the period from January 1, 2001 to
October 5, 2001 and for the period from October 6, 2001 to December 31, 2001 was
$29.3 million and $45.5 million, respectively, for US operations and $0.4
million and $0.1 million, respectively, for foreign operations. These amounts
include the amounts allocated to discontinued operations in 1999, all of which
occurred in U.S. operations.

The components of the income tax provision for each of the periods presented are
as follows (in thousands):

F-14

Reconciliations of the provisions for income taxes computed at the statutory
rate of the reported provisions for income taxes for the indicated periods are
set forth below (in thousands).

The tax effect of temporary differences that give rise to significant components
of deferred tax assets and liabilities at December 31, 2001 and December 31,
2000 of Worldwide are as follows (in thousands):

Worldwide has approximately $54.7 million of net operating losses at December
31, 2001. Approximately $1.3 million of this amount will expire from 2010 to
2013 and $53.4 million will expire from 2020 to 2022.

Section 382 of the Internal Revenue Code limits the future use of net operating
losses if there is more than a 50% change in control over a three (3) year
period. The annual limitation is equal to the value of Worldwide at the change
date multiplied by the applicable federal funds rate, plus any recognized
built-in-gains. Approximately $47.2 million of Worldwide NOL's are subject to
the Section 382 limitation. The annual limitation on the NOL's is approximately
equal to $12.0 million, plus any recognized built-in-gains. Any unused Section
382 limitation may generally be carried forward.

We had $47.2 million of NOL's at the acquisition date, which was fully offset by
a valuation allowance. Any future reduction in this valuation allowance will be
reflected first as a reduction of intangible assets and then as an increase to
equity. We had approximately $7.5 million of net operating losses that were
generated after the acquisition date; these are also fully offset by a valuation
allowance. Any future reduction in this valuation allowance will reduce future
income tax expense.

F-15

We recorded gross deferred tax assets in connection with the 2001 acquisition.
The deferred tax assets were fully offset by a valuation allowance. Accordingly,
we did not record a net deferred tax asset associated with the 2001 acquisition.

We evaluate all deferred tax assets to determine if a valuation allowance is
needed. In 2001, we determined it was more likely than not that our net deferred
tax assets would not be realized.

We had a valuation allowance for the periods ended December 31, 2000 and 2001,
in the amounts of $0.6 million and $20.0 million respectively. Of the $19.4
million increase, $8.5 million offset the tax benefit of the operating loss
incurred from January 1, 2001 to October 5, 2001, $8.9 million offset the gross
deferred tax assets recorded in connection with the 2001 acquisition on October
5, 2001 and $2.0 million offset the tax benefit of the operating loss incurred
from October 6, 2001 to December 31, 2001.

9. FINANCIAL INSTRUMENTS

In connection with the Senior Secured Credit Facility, Worldwide was required to
purchase interest rate caps in order to manage risks related to changes in
variable interest rates. The interest rate caps limited Worldwide's exposure to
floating interest rates and caps it at 6.5%. These caps have a notional amount
of $44.8 million at December 31, 2001 and 2000, and expire in varying amounts
through March 2003. In 2000 and during the nine months ended December 31, 1999,
the interest rate caps exceeded the outstanding borrowings under the Senior
Secured Credit Facility, resulting in a mark-to-market charge to interest
expense of $415,000 and $58,000, respectively. The approximate fair
value of these instruments at December 31, 2001 and 2000 was zero and $43,000,
respectively.

10. COMMITMENTS AND CONTINGENCIES

Future minimum lease payments under operating leases with initial and remaining
noncancelable lease terms in excess of one year are as follows (in thousands):

2002....................... $ 15,892
2003....................... 9,762
2004....................... 8,694
2005....................... 6,394
2006 and thereafter........ 18,803
-------------
$ 59,545
=============

All major airport facilities and office spaces are leased under operating
leases, many of which include renewal options and indexed escalation clauses.

Commitments and Contingencies

We are involved in an investigation by the National Transportation Safety Board
("NTSB") into the cause of the crash of an Emery Worldwide Airlines, Inc. cargo
jet on February 16, 2000. The crash occurred shortly after takeoff from Mather
Field in Sacramento, California, killing all three people aboard. Miami Aircraft
Support, Inc., a subsidiary of Worldwide, loaded the cargo onto the plane. We
are cooperating with the NTSB in the investigation, and to date the NTSB has not
issued its report.

In addition to the NTSB investigation, we are one of several defendants in three
individual lawsuits arising out of the crash. One of the suits is filed in state
court in California, one in state court in Ohio, and one in state court in
Texas. We believe that we have adequate insurance coverage for any liability
that may ultimately be assessed in these suits.

Actions and claims against certain subsidiaries of Worldwide under common law
and state and federal statutes for employment, personal injury, property damage
and breach of contract arise in the ordinary course of their businesses. The
remedies sought in such actions include compensatory, punitive and exemplary
damages as well as equitable relief. Reserves for such lawsuits and claims are
recorded to the extent that losses are deemed probable and can be reasonably
estimated. In the opinion of management, the resolution of all such pending
lawsuits and claims

F-16

will not have a material effect on the earnings, cash flows or consolidated
financial position of Worldwide.

During 2000 the Aviation Department of Miami-Dade County International Airport
performed an audit of our Gross Revenues calculation, which is used in
determining the airport fees paid under our general aeronautical services
permit. In connection with that audit the airport assessed $0.8 million in
additional airport fees. Although we contested these findings, we were
ultimately unsuccessful in our attempt to overcome the airport's position and
therefore recorded the charge in 2001.

AMR Earn-Out

In connection with the Castle Harlan acquisition, we are contingently obligated
to pay AMR an additional amount if revenues from AMR exceed specific amounts
over a ten-year period from the date of the Castle Harlan acquisition. If these
revenue targets are met, we will pay AMR up to $10.0 million plus accrued
interest. We are not able to predict whether or not we will meet these revenue
targets.

11. DISCONTINUED OPERATIONS -- CYCLONE

In July 1998, the Predecessor acquired all of the stock of Cyclone Surface
Cleaning, Inc. ("Cyclone") and began to fund its operations. Cyclone was engaged
in developing a technology to clean airport runways. Assets acquired consisted
primarily of intangibles, including $565,000 of goodwill, and the acquisition
was accounted for as a purchase.

In 1999, Worldwide elected to discontinue the Cyclone business since it did not
fit with Worldwide's core businesses. Accordingly, the results of operations for
the three-month period ended March 31, 1999 reflect the Cyclone business as
discontinued operations. On August 31, 1999, Worldwide terminated its
relationship with the former owners of Cyclone and settled all obligations due
under a promissory note.

12. GEOGRAPHIC OPERATIONS

Worldwide operates as an independent ground services provider to air-cargo and
passenger airlines in North America, Europe, and Asia. Worldwide, however,
operated in a single business segment, as a provider of ground services to the
aviation industry. Inter-area sales are not material. Long-lived assets by
geographic area represent those assets used in Worldwide's operations in each
area. Corporate level assets and liabilities are included as a component of
North America.

Information about Worldwide's operations in these geographic areas is as follows
(in thousands):

13. FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS

The Senior Notes discussed in Note 4 are fully and unconditionally guaranteed on
a joint and several basis by current domestic subsidiaries. Foreign subsidiaries
do not guarantee the Senior Notes. The following tables present condensed
consolidating financial information for the Company, its subsidiary guarantors
and non-guarantor foreign subsidiaries (in thousands):

F-17

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING BALANCE SHEET
DECEMBER 31, 2001

F-18

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
FOR THE PERIOD FROM OCTOBER 6, 2001 THROUGH DECEMBER 31, 2001

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM OCTOBER 6, 2001 THROUGH DECEMBER 31, 2001

F-19

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
FOR THE PERIOD FROM JANUARY 1, 2001 THROUGH OCTOBER 5, 2001

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 1, 2001 THROUGH OCTOBER 5, 2001

F-20

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING BALANCE SHEET
DECEMBER 31, 2000

F-21

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2000

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2000

F-22

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
FOR THE PERIOD FROM APRIL 1, 1999 THROUGH DECEMBER 31, 1999

WORLDWIDE FLIGHT SERVICES, INC.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM APRIL 1, 1999 THROUGH DECEMBER 31, 1999

F-23

AMRS (Predecessor)

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
FOR THE PERIOD FROM JANUARY 1, 1999 THROUGH MARCH 31, 1999

AMRS (Predecessor)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 1, 1999 THROUGH MARCH 31, 1999

14. STOCK-BASED COMPENSATION PLAN

Until the 2001 acquisition, WFS Holdings, Inc., Worldwide's parent, had a stock
option plan allowing management to grant certain executives and other key
employees options to purchase up to 100,000 shares of WFS Holdings, Inc. common
stock. The plan provided for the vesting of options based on the future
operating performance of

F-24

Worldwide. Any unvested options would be forfeited at the end of the performance
period if certain performance targets were not met. Worldwide recognized expense
based on the intrinsic value method because the number of stock options that
would have ultimately vested was not fixed and determinable. These amounts
became fixed at the time of the 2001 acquisition and the Company recognized
non-cash stock compensation expense of $1.9 million for the period from January
1, 2001 through October 5, 2001. In connection with the change of control on
October 5, 2001, all of the outstanding options vested and were exercised. On
October 5, 2001, the plan was terminated and there were no outstanding stock
options at December 31, 2001.

15. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

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EXHIBITS INDEX

ITEM 14.(a)(3)

4.4 Form of Senior Guarantee (Exhibit 4.4 of Form S-4 filed
October 7, 1999, File No. 333-88593)

4.5 Supplemental Indenture, dated as of September 7, 1999, by
and among Worldwide Flight Services, Inc., The Bank of New
York, as Trustee and Guarantors (Exhibit 4.5 of Amendment
No. 3 to Form S-4 filed on January 26, 2000, File No.
333-88953)

Voting Trust Agreement

9.1 Form of Voting Trust Agreement, among WFS Holdings, Inc.,
Stockholders and Leonard M. Harlan (Exhibit 9.1 of Form S-4
filed October 7, 1999, File No. 333-88593)

Material Contracts

10.1 Purchase Agreement, dated August 5, 1999 by and among the
Registrant, WFS Holdings, Inc., the initial Guarantors and
the Initial Purchasers (Exhibit 10.1 of Form S-4 filed
October 7, 1999, File No. 333-88593)

10.2 Stock Purchase Agreement, dated May 28, 1999, among Miami
Aircraft Support, Worldwide Holding Corporation, Anthony
Romeo and Charles Micale (Exhibit 10.2 of Form S-4 filed
October 7, 1999, File No. 333-88593)

10.3 Amended and Restated Stock Purchase Agreement dated as of
December 23, 1998 among MR Services Acquisition Corporation,
AMR Services Holding Corporation and AMR Corporation
(Exhibit 10.14 of Amendment No. 1 to Form S-4 filed November
24, 1999, File No. 333-88953)

10.4* Executive Employment Agreement, dated July 1, 2000, between
Worldwide Flight Services, Inc. and Peter A. Pappas (Exhibit
10.4 of Form 10-K 405 for year ended December 31, 2000,
File No. 333-88593)

10.5* Executive Employment agreement dated May 17, 2000 between
Worldwide Flight Services, Inc. and David F. Chavenson
(Exhibit 10.1 of Form 10-Q for quarter ended June 30, 2000,
File No. 333-88593)

10.6* Executive Employment agreement dated June 1, 2000 between
Worldwide Flight Services, Inc. and Bradley G. Stanius
(Exhibit 10.2 of Form 10-Q for quarter ended June 30, 2000,
File No. 333-88593)

10.7* Employment Agreement, dated December 7, 1998, between
Worldwide Flight Services, Inc. (formerly known as AMR
Services Corporation) and Olivier Bijaoui (Exhibit 10.7 of
Form S-4 filed October 7, 1999, File No. 333-88593)

10.8* Employment Agreement, dated December 2, 1999, between
Worldwide Flight Services, Inc. and H. Douglas Pinckney
(Exhibit 10.8 of Form 10-K for year ended December 31, 1999,
File No. 333-88593)

10.9* WFS Holdings, Inc. 1999 Stock Option Plan (Exhibit 10.3 of
Form S-4 filed October 7, 1999, File No. 333-88593)

10.10 Credit Agreement dated as of August 12, 1999, among WFS
Holdings, Inc., Worldwide Flight Services, Inc., the Lenders
party thereto, The Chase Manhattan Bank, as Administrative
Agent, and DLJ Capital Funding, Inc., as Syndication Agent
(Exhibit 10.9 of Form S-4 filed October 7, 1999, File No.
333-88593)

10.10(a) Amendment and Waiver No. 1, dated as of March 24, 2000, to
the Credit Agreement, dated August 12, 1999, among WFS
Holdings, Inc., Worldwide Flight, Services, Inc., the
Lenders listed therein and The Chase Manhattan Bank as
administrative agent (Exhibit 10.1 of Form 10-Q for quarter
ended March 31, 2000, File No. 333-88593)

10.10(b) Amendment #2 dated as of August 14, 2000, to the Credit
Agreement dated as of August 12, 1999 (as amended,
supplemented or otherwise modified from time to time, the
"Credit Agreement"). Among WFS HOLDINGS, INC., a Delaware
corporation (Holdings), WORLDWIDE FLIGHT SERVICES, INC., a
Delaware corporation (the "Borrower"), the lenders party
thereto (the "Lenders") and THE CHASE MANHATTAN BANK, a New
York banking corporation, as administrative agent for the
Lenders (in such capacity, the "Administrative Agent")
(Exhibit 10.3 of Form 10-Q for quarter ended June 30, 2000,
File No. 333-88593)

10.11 Security Agreement dated as of August 12, 1999, among
Worldwide Flight Services, Inc., each subsidiary of WFS
Holdings, Inc. listed on Schedule I thereto and The Chase
Manhattan Bank, a New

York banking corporation, as administrative agent for the
Secured Parties (Exhibit 10.10 of Form S-4 filed October 7,
1999, File No. 333-88593)

10.12 Indemnity, Subrogation and Contribution Agreement dated as
of August 12, 1999, among Worldwide Flight Services, Inc.,
each subsidiary of WFS Holdings, Inc. listed on Schedule I
thereto and The Chase Manhattan Bank, a New York banking
corporation, as administrative agent for the Secured Parties
(Exhibit 10.11 of Form S-4 filed October 7, 1999, File No.
333-88593)

10.13 Guarantee Agreement dated as of August 12, 1999, among WFS
Holdings, Inc., each subsidiary of our parent listed on
Schedule I thereto and The Chase Manhattan Bank, a New York
banking corporation, as administrative agent for the Secured
Parties (Exhibit 10.12 of Form S-4 filed October 7, 1999,
File No. 333-88593)

10.14 Pledge Agreement dated as of August 12, 1999, among
Worldwide Flight Services, Inc., WFS Holdings, Inc., each
subsidiary of WFS Holdings, Inc. listed on Schedule I
thereto and The Chase Manhattan Bank, a New York banking
corporation, as administrative agent for the Secured Parties
(Exhibit 10.13 of Form S-4 filed October 7, 1999, File No.
333-88593)

Other Exhibits, as indicated

10.15* Employment Agreement dated as of April 1, 2001 between
Worldwide Flight Services, Inc., a Delaware corporation,
together with its subsidiaries and Barry Strong (Exhibit
10.1 of Form 10-Q for quarter ended March 31, 2001, File No.
333-88593)

10.16 Waiver and amendment No. 4 dated as of May 10, 2001 to the
Credit Agreement dated as of August 12, 1999 as amended
among WFS Holdings, Inc., Worldwide Flight Services, Inc.,
the lenders party thereto, The Chase Manhattan Bank as
Administrative Agent and DLJ Capital Funding, Inc. as
Syndication Agent. (Exhibit 10.2 of Form 10-Q for quarter
ended March 31, 2001, File No. 333-88593)

10.17 Waiver and amendment No. 4 dated as of August 13, 2001 to
the Credit Agreement dated as of August 12, 1999 as amended
among WFS Holdings, Inc., Worldwide Flight Services, Inc.,
the lenders party thereto, The Chase Manhattan Bank as
Administrative Agent and DLJ Capital Funding, Inc. as
Syndication Agent. (Exhibit 10.1 of Form 10-Q for quarter
ended June 30, 2001, File No. 333-88593)

10.18 Support Agreement dated August 13, 2001 among Castle
Harlan Partners III, L.P., WFS Holdings, Inc., Worldwide
Flight Services, Inc., The Chase Manhattan Bank and DLJ
Capital Funding, Inc. (Exhibit 10.2 of Form 10-Q for quarter
ended June 30, 2001, File No. 333-88593)

10.19 Subordination Agreement dated August 13, 2001 among
Castle Harlan Partners III, L.P., WFS Holdings, Inc.,
Worldwide Flight Services, Inc., The Chase Manhattan Bank
and DLJ Capital Funding, Inc. (Exhibit 10.3 of Form 10-Q for
quarter ended June 30, 2001, File No. 333-88593)

10.20* Employment Agreement dated as of October 6, 2001 between
Worldwide Flight Services Holdings, together with its
subsidiaries and Bradley G. Stanius (Exhibit 10.1 of Form
10-Q for quarter ended September 30, 2001, File No.
333-88593)

10.21* Employment Agreement dated as of October 5, 2001 between
Worldwide Flight Services, Inc. together with its
subsidiaries and Jay Norris (Exhibit 10.2 of Form 10-Q for
quarter ended September 30, 2001, File No. 333-88593)

10.22* Employment Agreement dated as of October 5, 2001 between
Worldwide Flight Services, Inc. together with its
subsidiaries and Irving Reed (Exhibit 10.3 of Form 10-Q for
quarter ended September 30, 2001, File No. 333-88593)

10.23* Employment Agreement dated as of February 1, 2002 between
Worldwide Flight Services, Inc. together with its
subsidiaries and Jeanette Quay (Filed herewith)

10.24* Employment Agreement dated as of February 1, 2002 between
Worldwide Flight Services, Inc. together with its
subsidiaries and Jean-Francois Gouedard (Filed herewith)

10.25* Executive Employment Agreement dated as of March 31, 2001
between Worldwide Flight Services, Inc. and Anthony P. Dalia
(Filed herewith)

10.26* Amendment to the Employment Agreement dated as of January 1,
2001 between Worldwide Flight Services, Inc. and James
Enright (Filed herewith)

10.27* Executive Employment Severance and Settlement Agreement and
General Release dated as of November 30, 2001 between
Worldwide Flight Services, Inc. and Bradley G. Stanius
(Filed herewith)

12.1 Statement regarding Computation of Ratio of Earnings to
Fixed Charges of Worldwide Flight Services, Inc. (Exhibit
12.1 of Form 10-K 405 for year ended December 31, 2000, File
No. 333-88593)

16.1 Letter of Ernst & Young, LLP dated December 20, 2001
(Exhibit 16.1 of Form 8-K filed December 20, 2001, File No.
333-88593)

21 Subsidiaries of Worldwide Flight Services, Inc. (Exhibit
21 of Form 10-K 405 for year ended December 31, 2000, File
No. 333-88593

* This exhibit constitutes a "management contract or compensatory plan,
contract or arrangement."