The dust still hasn’t settled from the Amazon/ATSG deal, and now the e-commerce giant has done it again, this time with Atlas Air Worldwide Holdings Inc.

Simultaneously with the release of its first-quarter results, Atlas [ticker: AAWW] announced the signing of an agreement with Amazon under which AAWW’s airline subsidiary Atlas Air will operate twenty 767-300 freighters for Amazon. We will update this breaking-news post as more information becomes available (so scroll down to the bottom), but here’s what we know so far:

• Amazon will dry lease twenty freighter-converted 767-300Fs from Titan Aviation Leasing, AAWW’s dry-leasing subsidiary. These dry leases will be for ten years.

• Atlas Air will operate the freighters for Amazon on a CMI basis (crew, maintenance, and insurance). The CMI agreements will be for seven years, with an option for a three-year extension.

• The first of these freighters will enter Amazon service in the second half of this year, with all twenty to be in service by the end of 2018.

• AAWW granted Amazon warrants to acquire up to 20% of AAWW’s common shares, at a price of $37.50 per share, over five years. Vesting is tied to commencement of the air operation as well as to other conditions.

• AAWW also granted Amazon warrants to acquire up to an additional 10% stake (at the same $37.50 per share), over a period of seven years, if Amazon increases its business with Atlas beyond the initial 20-freighter deal.

• Atlas says it expects the deal will be “meaningfully accretive to Atlas Air Worldwide’s earnings and cash flows over time.”

Of course, there are plenty of questions still to be answered: Where will Atlas get twenty freighter-converted 767-300s in time to put them into service by the end of 2018? Who will do the conversions? Will the Atlas freighters operate as part of the North American network being run for Amazon by ASTG at the hub in Wilmington (ILN)?

But while we wait for answers to these questions, one thing we can say is that reports of Amazon’s move into the express business look less “fantastical” today.

Update from Atlas

Atlas Air Worldwide Holdings CEO Bill Flynn and CFO Spencer Schwartz provided answers to some of the above questions during a conference call this morning. They also shed further light on the stake purchase.

Where will the twenty 767-300s come from? Atlas says it has already acquired some of the 767-300s already, and is “well along with procuring the remainder.” The company says it expects no problem bringing the converted freighters into operation for Amazon on schedule. Further, Atlas says funding the purchases will not be a problem, and it will not have to dip into its cash reserves.

Who will do the conversions? There are only two sources of 767-300 P-to-F conversion available, Boeing and Bedek Aviation Group. Atlas did not provide a clear answer, but CEO Flynn said the company would “work with several shops” for the conversions. Atlas currently has two 767-300s in conversion at Bedek’s Tel Aviv facility.

Where will the freighters be operated? Mr. Flynn replied to this question by saying Amazon had not yet provided a schedule, but that expected the flying to be “mostly in North America.”

Regarding the warrants:

• The first tranche of 20% is split in two, with 10% vesting at the signing of the deal, the other 10% vesting as the aircraft are put into service for Amazon. The vesting of the first 10% gives Amazon a non-voting seat on the board. That will change to a full board membership when the stake grows.

• The second tranche of up to another 10% will vest if and when Amazon increases its business with AAWW to more than the operation of the twenty freighters. This increased business could be in the form of additional aircraft, or in the form of other services.

How will this deal affect Atlas’ relationship with DHL? Bill Flynn said “DHL is very supportive of this transaction.”

What will be the impact of the deal on Atlas’ earnings? Costs associated with startup of the operation include acquisition and conversion of the aircraft, spare engines, hiring and training more pilots maintenance personnel. Therefore, the deal will have a small negative impact on bottom line this year, but should become accretive in 2017, and strongly accretive by the end of 2018.

How did the market react? Within hours of the announcement, Atlas Air Worldwide Holdings share price had risen almost 30% to $49.60