FUEL SURCHARGE
The diesel fuel prices in the following index are published by the Energy Information Association of the U.S. Department of Energy (202) 586-6966.
The index is located on the internet at: http://tonto.eia.doe.gov/oog/info/gdu/gasdiesel.asp.

Rates For: November 16th thru November 23rd

At Least But Less Than Fuel Surcharge Today $2.75 $2.80 18.5%

March 22, 2004

Dear Valued Customer,

Effective April 5, 2004, PACE AIR FREIGHT will be implementing a Fuel Surcharge.

For several years, PACE AIR FREIGHT has deferred a Fuel Surcharge. This decision is necessary due to the ever-increasing cost of fuel.

We will base the Fuel Surcharge on a percentage subject to a weekly adjustment in accordance with the U.S. Department of Energy’s national average price of diesel fuel per gallon. The adjustments will be in respect to the attached matrix table. The weekly trends in fuel costs will be determined each Monday and implemented the following Tuesday.

Thank you for your understanding and cooperation in this matter.

We sincerely appreciate the opportunity to service your transportation needs and for your customer loyalty.

Respectfully submitted,

Robert Pfeffer
President
PACE AIR FREIGHT, Inc.