PAGI Pemco Aviation Grp. (MM)

Pemco Aviation Group, Inc. (NASDAQ: PAGI) announced today that its Dothan, Alabama subsidiary, Pemco World Air Services, has entered into an agreement with International Lease and Finance Corporation (ILFC), for the cargo conversion of one B-737-300 aircraft from passenger to freighter configuration for delivery in 2006, and an option to convert three additional aircraft in 2007. Pemco currently operates under an agreement for maintenance and modification services on ILFC's fleet of transport aircraft, both wide and narrow body. Ron Aramini, President and Chief Executive Officer of Pemco Aviation states, "Our relationship with ILFC has grown steadily and become a very important part of our operations in Dothan. We are very pleased that they have decided to expand their relationship with us to include cargo conversion of B737-300 aircraft. ILFC recognizes our commitment to a quality product, delivered on schedule with cost effective pricing. ILFC's decision to move forward with Pemco on this important program is very gratifying." "We are pleased to continue our longstanding relationship with Pemco," Richard Poutier, Senior Vice President for ILFC said. Pemco Aviation Group, with executive offices in Birmingham, Alabama, and facilities in Alabama and California, performs maintenance and modification of aircraft for the U.S. Government and for foreign and domestic commercial customers. The Company also provides aircraft parts and support and engineering services, in addition to developing and manufacturing aircraft cargo systems, rocket vehicles and control systems, and precision components. For more information go to www.pemcoaviationgroup.com. ILFC is the international market leader in the leasing and remarketing of advanced technology commercial jet aircraft to airlines around the world. ILFC owns a portfolio valued at more than $40 billion, consisting of more than 800 jet aircraft. For more information go to www.ilfc.com. This press release contains forward-looking statements made in reliance on the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements may be identified by their use of words, such as "believe," "expect," "intend" and other words and terms of similar meaning, in connection with any discussion of the Company's prospects, financial statements, business, financial condition, revenues, results of operations or liquidity. Factors that could affect the Company's forward-looking statements include, among other things: changes in global or domestic economic conditions; the loss of one or more of the Company's major customers; the Company's ability to obtain additional contracts and perform under existing contracts; the outcome of pending and future litigation and the costs of defending such litigation; financial difficulties experienced by the Company's customers; potential environmental and other liabilities; the inability of the Company to obtain additional financing; material weaknesses in the Company's internal control over financial reporting; regulatory changes that adversely affect the Company's business; loss of key personnel; and other risks detailed from time to time in the Company's SEC reports, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2005. The Company cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. The Company does not undertake any obligation to update or revise any forward-looking statements and is not responsible for changes made to this release by wire services or Internet services.