AMENDED AND RESTATED CREDIT AGREEMENT
                   dated as of March 27, 2006

                              Among

                    AMERICAN AIRLINES, INC.,
                          as Borrower,

                        AMR CORPORATION,
                      as Parent Guarantor,

                       CITICORP USA, INC.,
                    as Administrative Agent,

                   JPMORGAN CHASE BANK, N.A.,
                      as Syndication Agent,

                               and

                the Other Lenders Party Thereto.



 CITIGROUP GLOBAL MARKETS INC. and J.P. MORGAN SECURITIES INC.,

     as Joint Lead Arrangers and Joint Book-Running Managers

























                        TABLE OF CONTENTS

                                                             Page


                            ARTICLE I
                   DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.01. CERTAIN DEFINED TERMS                             2
SECTION 1.02. COMPUTATION OF TIME PERIODS; OTHER DEFINITIONAL
              PROVISIONS                                       26
SECTION 1.03. ACCOUNTING TERMS                                 26
SECTION 1.04. DEEMED REFERENCES                                26

                           ARTICLE II
                AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.01. THE ADVANCES                                     26
SECTION 2.02. MAKING THE ADVANCES                              28
SECTION 2.03. FEES                                             30
SECTION 2.04. TERMINATION OR REDUCTION OF THE COMMITMENTS      30
SECTION 2.05. REPAYMENT OF ADVANCES                            31
SECTION 2.06. INTEREST                                         32
SECTION 2.07. CONVERSION OF ADVANCES                           33
SECTION 2.08. PREPAYMENTS OF ADVANCES                          33
SECTION 2.09. INCREASED COSTS, ETC.                            34
SECTION 2.10. ILLEGALITY                                       36
SECTION 2.11. PAYMENTS AND COMPUTATIONS                        36
SECTION 2.12. TAXES                                            38
SECTION 2.13. SHARING OF PAYMENTS, ETC.                        40
SECTION 2.14. EVIDENCE OF DEBT                                 41
SECTION 2.15. USE OF PROCEEDS                                  42
SECTION 2.16. MITIGATION, SUBSTITUTION OF LENDER               42
SECTION 2.17. DEFAULTING LENDERS                               42

                           ARTICLE III
                   CONDITIONS OF EFFECTIVENESS

SECTION 3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS            45
SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING           46
SECTION 3.03. DETERMINATIONS UNDER SECTION 3.01                47

                           ARTICLE IV
                 REPRESENTATIONS AND WARRANTIES

SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE BORROWER   47
SECTION 4.02. REPRESENTATIONS AND WARRANTIES OF THE PARENT
              GUARANTOR                                        51

                            ARTICLE V
                  COVENANTS OF THE LOAN PARTIES

SECTION 5.01. AFFIRMATIVE COVENANTS                            52
SECTION 5.02. NEGATIVE COVENANTS                               63
SECTION 5.03. FINANCIAL COVENANTS                              65

                           ARTICLE VI
                        EVENTS OF DEFAULT

SECTION 6.01. EVENTS OF DEFAULT                                66

                           ARTICLE VII
                         PARENT GUARANTY

SECTION 7.01. GUARANTY                                         70
SECTION 7.02. GUARANTY ABSOLUTE                                70
SECTION 7.03. WAIVERS AND ACKNOWLEDGMENTS                      71
SECTION 7.04. SUBROGATION                                      72
SECTION 7.05. CONTINUING GUARANTY; ASSIGNMENTS                 73

                          ARTICLE VIII
                            THE AGENT

SECTION 8.01. AUTHORIZATION AND ACTION                         73
SECTION 8.02. AGENT'S RELIANCE, ETC.                           74
SECTION 8.03. CUSA AND AFFILIATES                              75
SECTION 8.04. LENDER CREDIT DECISION                           75
SECTION 8.05. INDEMNIFICATION                                  75
SECTION 8.06. SUCCESSOR AGENT                                  76

                           ARTICLE IX
                          MISCELLANEOUS

SECTION 9.01. AMENDMENTS, ETC.                                 77
SECTION 9.02. NOTICES, ETC.                                    77
SECTION 9.03. NO WAIVER; REMEDIES                              79
SECTION 9.04. COSTS AND EXPENSES                               79
SECTION 9.05. RIGHT OF SET-OFF                                 81
SECTION 9.06. BINDING EFFECT                                   81
SECTION 9.07. ASSIGNMENTS AND PARTICIPATIONS                   82
SECTION 9.08. CONFIDENTIALITY                                  85
SECTION 9.09. RELEASE OF COLLATERAL                            86
SECTION 9.10. GOVERNING LAW                                    86
SECTION 9.11. EXECUTION IN COUNTERPARTS                        86
SECTION 9.12. JURISDICTION, ETC.                               86
SECTION 9.13. WAIVER OF JURY TRIAL                             87

                                ii



SCHEDULES

Schedule  I           -     Commitments  and  Applicable  Lending
                            Offices
Schedule 1.01         -     Existing Capacity Agreements
Schedule 4.01(b)      -     Subsidiaries
Schedule  4.01(d)     -     Authorizations, approvals, actions,
                            notices and filings
Schedule 4.01(f)      -     Litigation


EXHIBITS

Exhibit A-1           -     Form of Revolving Credit 1 Note
Exhibit A-2           -     Form of Term 1 Note
Exhibit B             -     Form of Notice of Borrowing
Exhibit C             -     Form of Assignment and Acceptance
Exhibit D-1           -     Form of Compliance Certificate for the
                            Borrower
Exhibit D-2           -     Form of Compliance Certificate for the Parent
                            Guarantor


                                iii



              AMENDED AND RESTATED CREDIT AGREEMENT

          AMENDED    AND   RESTATED   CREDIT   AGREEMENT    (this
"Agreement") dated as of March 27, 2006 among American  Airlines,
Inc., a Delaware corporation (the "Borrower"), AMR Corporation, a
Delaware   corporation  ("AMR"),  the  Lenders  (as   hereinafter
defined)  signatories  hereto, Citicorp USA,  Inc.  ("CUSA"),  as
Administrative  Agent  (the "Agent") for  the  Lenders,  JPMorgan
Chase  Bank, N.A., as Syndication Agent (the "Syndication Agent")
and  Citigroup  Global  Markets Inc. and J.P.  Morgan  Securities
Inc.,  as  Joint  Lead Arrangers and Joint Book-Running  Managers
(collectively, the "Lead Arrangers").

          PRELIMINARY STATEMENTS:

     (1)  The Borrower, AMR, certain banks, financial institutions
and other  institutional  lenders from time  to  time  party  thereto
(collectively, the "Pre-Amendment Lenders"), the  Agent  and  the
Syndication Agent have entered into a Credit Agreement  dated  as
of  December 17, 2004 (such Credit Agreement, as so amended prior
to   the   Restatement  Effective  Date,  the  "Existing   Credit
Agreement";   capitalized  terms  used   in   these   Preliminary
Statements  but  not otherwise defined shall be  used  herein  as
defined in this Agreement).

     (2)  The Borrower desires to (i) increase the aggregate amount of
the  Term  Commitment to $448,000,000, (ii) reduce the  aggregate
amount  of the Revolving Credit Commitments to $325,000,000,  and
(iii)  refinance (a) outstanding Term Advances under the Existing
Credit  Agreement with a new class of Term 1 Advances under  this
Agreement and (b) outstanding Revolving Credit Advances under the
Existing Credit Agreement with a new class of Revolving Credit  1
Advances  under this Credit Agreement and with a portion  of  the
new class of Term 1 Advances.

     (3) Each Term Lender who executes and delivers this Agreement
shall  be  deemed, upon the Restatement Effective Date,  to  have
exchanged  its  Term  Commitment and Term  Advances  (which  Term
Commitment   and  Term  Advances  shall  thereafter   be   deemed
terminated and deemed repaid and refinanced in full) for a Term 1
Commitment  in the same aggregate principal amount as  such  Term
Lender's Term Commitment, as so terminated, and a Term 1  Advance
in the same aggregate principal amount as such Term Lender's Term
Advance,  as  so  repaid, and such Term Lender  shall  thereafter
become a Term 1 Lender.

     (4) Each Revolving Credit Lender who executes and delivers this
Agreement  shall be deemed, upon the Restatement Effective  Date,
to  have  exchanged its Revolving Credit Commitment and Revolving
Credit  Advance (which Revolving Credit Commitment and  Revolving
Credit  Advance shall thereafter be deemed terminated and  deemed
repaid  and  refinanced  in  full)  for  a  Revolving  Credit   1
Commitment  in an amount equal to such Revolving Credit  Lender's
Exchange  Ratio times the aggregate amount of Revolving Credit  1
Commitments  and a Revolving Credit 1 Advance in an amount  equal
to  such  Revolving  Credit  Lender's Exchange  Ratio  times  the
aggregate principal amount of Revolving Credit 1 Advances made on
the  Restatement Effective Date, and such Revolving Credit Lender
shall thereafter become a Revolving Credit 1 Lender.

     (5) Each Person who executes and delivers this Agreement as an
Additional Term 1 Lender will make, on the Restatement Effective
Date, a Term 1 Advance to the Borrower, the proceeds of which
will be used by the Borrower (i) to refinance in full the
outstanding principal amount of Term Advances of Term Lenders, if
any, who do not execute and deliver this Agreement, it being
understood that, prior to the Restatement Effective Date, an
Additional Term 1 Lender may be a Term Lender, and (ii) if
necessary, to refinance in part the outstanding principal amount
of Revolving Credit Advances of Revolving Credit Lenders.

     (6) Each Person who executes and delivers this Agreement as an
Additional Revolving Credit 1 Lender will make, on the
Restatement Effective Date, a Revolving Credit 1 Advance to the
Borrower, the proceeds of which will be used by the Borrower to
refinance in full the outstanding principal amount of Revolving
Credit Advances of Revolving Credit Lenders, if any, who do not
execute and deliver this Agreement, it being understood that,
prior to the Restatement Effective Date, an Additional Revolving
Credit 1 Lender may be a Revolving Credit Lender.

     (7) On the Restatement Effective Date, the Borrower shall pay to
each Term Lender and Revolving Credit Lender, as the case may be,
all accrued and unpaid interest on, respectively, its Term
Advance and Revolving Credit Advance, to but excluding the
Restatement Effective Date.

     (8) Citigroup Global Markets Inc. and J.P. Morgan Securities
Inc. shall act as Joint Lead Arrangers and Joint Book-Running
Managers for this Agreement.

     (9) The Borrower, AMR, the Pre-Amendment Lenders signatory
hereto, the Additional Term 1 Lenders, the Additional Revolving
Credit 1 Lenders, the Agent and the Syndication Agent have agreed
to amend and restate the Existing Credit Agreement in its
entirety to read as set forth in this Amended and Restated Credit
Agreement.

          NOW THEREFORE, in consideration of the mutual covenants
and  agreements herein contained, the parties hereto covenant and
agree as follows:

                            ARTICLE I

                DEFINITIONS AND ACCOUNTING TERMS

          SECTION 1.01.  Certain Defined Term.  As used in this
Agreement, the following terms shall have   the  following  meanings
(such  meanings  to  be  equally applicable  to both the singular
and plural forms  of  the  terms defined):

          "AA    Collateral"   means,   collectively,   (a)   the
     "Collateral"  as  such  term  is  defined  in  the  Aircraft
     Security Agreement and (b) the "Collateral" as such term  is
     defined  in  the SGR Security Agreement (it being understood
     that "Collateral" under the SGR Security Agreement shall, in
     any  case  for  purposes of this Agreement, consist  of  the
     Narita Collateral).

          "Additional Revolving Credit 1 Advance" has the meaning
     specified in Section 2.01(b)(iii).


                                2

          "Additional Revolving Credit 1 Commitment" means,  with
     respect  to  an  Additional Revolving Credit 1  Lender,  the
     commitment of such Additional Revolving Credit 1  Lender  to
     make Additional Revolving Credit 1 Advances beginning on the
     Restatement Effective Date, in an amount set forth  next  to
     the name of such Additional Revolving Credit 1 Lender in the
     Register  on the Restatement Effective Date.  The  aggregate
     amount  of  the  Additional Revolving Credit  1  Commitments
     shall  equal  an  amount  equal to the  excess  of  (i)  the
     aggregate Revolving Credit Commitments in effect immediately
     prior  to  the Restatement Effective Date minus $200,000,000
     over  (ii)  the  aggregate  amount  of  Revolving  Credit  1
     Commitments of the Revolving Credit Lenders that execute and
     deliver  this  Agreement  on or  prior  to  the  Restatement
     Effective Date.

          "Additional Revolving Credit 1 Lender" means  a  Person
     with  an  Additional Revolving Credit 1 Commitment  to  make
     Additional  Revolving  Credit 1  Advances  to  the  Borrower
     beginning  on  the  Restatement  Effective  Date,  it  being
     understood that an Additional Revolving Credit 1 Lender  may
     be a Revolving Credit Lender.

          "Additional  Term 1 Advance" has the meaning  specified
     in Section 2.01(a)(ii).

          "Additional Term 1 Commitment" means, with  respect  to
     an   Additional  Term  1  Lender,  the  commitment  of  such
     Additional Term 1 Lender to make Additional Term 1  Advances
     on  the  Restatement Effective Date, in an amount set  forth
     next  to  the name of such Additional Term 1 Lender  in  the
     Register  on the Restatement Effective Date.  The  aggregate
     amount  of the Additional Term 1 Commitments shall equal  an
     amount  equal to the excess of (i) the sum of the  aggregate
     principal amount of the Term Facility immediately  prior  to
     the  Restatement Effective Date plus $200,625,000 over  (ii)
     the  aggregate  amount  of Term 1 Commitments  of  the  Term
     Lenders that execute and deliver this Agreement on or  prior
     to the Restatement Effective Date.

          "Additional  Term  1 Lender" means  a  Person  with  an
     Additional  Term  1  Commitment to make  Additional  Term  1
     Advances to the Borrower on the Restatement Effective  Date,
     it  being understood that an Additional Term 1 Lender may be
     a Term Lender.

          "Advance" means a Term 1 Advance or a Revolving  Credit
     1 Advance.

          "Affiliate"  means, as to any Person, any other  Person
     that, directly or indirectly, controls, is controlled by  or
     is  under common control with such Person.  For purposes  of
     this  definition,  the term "control" (including  the  terms
     "controlling",  "controlled by" and  "under  common  control
     with") of a Person means the possession, direct or indirect,
     of  the  power  to  direct or cause  the  direction  of  the
     management and policies of such Person, whether through  the
     ownership of Voting Interests, by contract or otherwise.

          "Agent"  has  the meaning specified in the  recital  of
     parties to this Agreement.

          "Agent's  Account"  means  the  account  of  the  Agent
     maintained by the Agent at Citibank, N.A., at its office  at
     388  Greenwich Street, New York, New York 10013, Account No.
     36852248, ABA #021000089, Account Name: Medium Term Finance,

                                3

     Reference:  American Airlines, or such other account of  the
     Agent  as is designated in writing from time to time by  the
     Agent to the Borrower and the Lenders for such purpose.

          "Aggregate  Collateral Value" means, at any  time,  the
     sum of (without duplication):

          (a)  with respect to Eligible Aircraft, 50% of the Aircraft
               Value thereof; and

          (b)  with respect to Eligible Cash Collateral, the Cash
               Collateral Value thereof;

     provided,  however,  that (i) the Aircraft  Value  of  MD-80
     Aircraft  constituting  Eligible Aircraft  included  in  the
     calculation of Aggregate Collateral Value shall  not  exceed
     30%  of the Aircraft Value of the Eligible Aircraft at  such
     time,  (ii)  the  Aircraft  Value of  Eligible  Aircraft  in
     Temporary  Storage included in the calculation of  Aggregate
     Collateral Value shall not exceed 10% of the Aircraft  Value
     of  the Eligible Aircraft at such time and (iii) there shall
     be  excluded  from  the calculation of Aggregate  Collateral
     Value any Aircraft in Deep Storage.

          "Agreement"   has   the  meaning   specified   in   the
     introductory paragraph hereto.

          "Agreement  Value" means, for each Hedge Agreement,  on
     any date of determination, an amount determined by the Agent
     equal  to:   (a) in the case of a Hedge Agreement documented
     pursuant   to   the  Master  Agreement  (Multicurrency-Cross
     Border)  published by the International Swap and Derivatives
     Association, Inc. (the "Master Agreement"), the  amount,  if
     any,  that would be payable by any Loan Party or any of  its
     Subsidiaries to its counterparty to such Hedge Agreement, as
     if  (i)  such Hedge Agreement was being terminated early  on
     such  date  of  determination,  (ii)  such  Loan  Party   or
     Subsidiary  was  the sole "Affected Party",  and  (iii)  the
     Agent  was  the  sole party determining such payment  amount
     (with  the Agent making such determination pursuant  to  the
     provisions of the form of Master Agreement); (b) in the case
     of  a  Hedge  Agreement traded on an exchange, the  mark-to-
     market  value  of such Hedge Agreement, which  will  be  the
     unrealized loss on such Hedge Agreement to the Loan Party or
     Subsidiary  of  a  Loan Party party to such Hedge  Agreement
     determined  by  the Agent based on the settlement  price  of
     such  Hedge Agreement on such date of determination; or  (c)
     in  all other cases, the mark-to-market value of such  Hedge
     Agreement,  which will be the unrealized loss on such  Hedge
     Agreement  to the Loan Party or Subsidiary of a  Loan  Party
     party to such Hedge Agreement determined by the Agent as the
     amount, if any, by which (i) the present value of the future
     cash  flows  to  be  paid by such Loan Party  or  Subsidiary
     exceeds  (ii) the present value of the future cash flows  to
     be  received  by such Loan Party or Subsidiary  pursuant  to
     such  Hedge  Agreement;  capitalized  terms  used  and   not
     otherwise  defined  in  this  definition  shall   have   the
     respective meanings set forth in the above described  Master
     Agreement.

          "Aircraft" means at any time, the Airframes and Engines
     set  forth on Schedule 1 to the Aircraft Security Agreement,
     as  supplemented or amended from time to time in  accordance
     with Section 5.01(n), including from and after the Effective
     Date,  the  Airframes and Engines described in the  Security
     Agreement Supplement originally executed and delivered under

                                4

     the Aircraft Security Agreement and any Replacement Airframe
     or  Replacement  Engine substituted for  any  collateral  in
     accordance with Section 5.01(n), whether or not, in the case
     of  any  such  Engines, such initial Engines or  Replacement
     Engines  may from time to time be installed on such Airframe
     or  installed  on any other airframe or any other  aircraft.
     The term "Aircraft" shall include any Replacement Aircraft.

          "Aircraft   Security  Agreement"  means  the   aircraft
     security agreement in substantially the form of Exhibit D to
     the  Existing  Credit Agreement, together  with  each  other
     security   agreement   and  security  agreement   supplement
     delivered  from time to time pursuant to Section 5.01(n)  of
     the Existing Credit Agreement or Section 5.01(n) hereof,  in
     each case as amended.

          "Aircraft  Value" means, at any time, with  respect  to
     any  Aircraft, the current market value, as reflected in the
     Appraisal  Report then most recently delivered to the  Agent
     with respect to such Aircraft.

          "Airframe" means (a) each of the Unencumbered  Stage  3
     Aircraft  (except the Engines or engines from time  to  time
     installed  thereon) listed on Schedule  1  to  the  Aircraft
     Security Agreement, as supplemented or amended from time  to
     time in accordance with Section 5.01(n) and (b) any and  all
     Parts so long as the same shall be incorporated or installed
     in or attached to such aircraft.

          "AMR"  has  the  meaning specified in  the  recital  of
     parties to this Agreement.

          "AMR Collateral" means the "Collateral" as such term is
     defined in the Pledge Agreement.

          "AMR  Subsidiary" means any corporation  of  which  AMR
     owns  or controls, directly or indirectly, more than 50%  of
     the Voting Interests.

          "Applicable Lending Office" means, with respect to each
     Lender, such Lender's Domestic Lending Office in the case of
     a  Base  Rate  Advance and such Lender's Eurodollar  Lending
     Office in the case of a Eurodollar Rate Advance.

          "Applicable Margin" means (a) in respect of the Term  1
     Facility,  3.25%  per annum, in the case of Eurodollar  Rate
     Advances,  and  2.25% per annum, in the case  of  Base  Rate
     Advances,  and  (b)  in respect of the  Revolving  Credit  1
     Facility  a  percentage  per  annum  to  be  determined   by
     reference to the Pricing Level as set forth below:

                                5


                   Pricing    Applicable     Applicable
                    Level     Margin for     Margin for
                              Eurodollar     Base Rate
                                 Rate         Advances
                               Advances

                   Level 1       2.50%         1.50%

                   Level 2       3.00%         2.00%

                   Level 3       3.50%         2.50%

                   Level 4       4.00%         3.00%

          "Appraisal  Report"  means  (a)  with  respect  to  any
     Aircraft  or Engine, an extended desktop appraisal  prepared
     by   an  Appraiser,  which  does  not  include  any  on-site
     inspection  of  such Aircraft or Engine or  its  maintenance
     records, and which assumes its physical condition is average
     for  an  aircraft  or engine of its type  and  age  and  its
     maintenance  time status is at mid-life, mid-time,  and  (b)
     with  respect to the Narita Collateral, an appraisal  report
     prepared  by  an Appraiser in form and substance  reasonably
     satisfactory to the Agent (it being agreed that an Appraisal
     Report  substantially  in the form of the  Appraisal  Report
     delivered  on  the  Effective Date shall  be  deemed  to  be
     reasonably satisfactory to the Agent).

          "Appraiser" means, in the case of Aircraft and Engines,
     Airclaims  Ltd.,  and in the case of the Narita  Collateral,
     Simat, Helliesen & Eichner, Inc., or in either case, if  for
     any  reason such Person ceases or is unable at such time  to
     provide  an  appraisal  of  the type  set  forth  under  the
     definition   of   "Appraisal  Report"  (including,   without
     limitation, by virtue of the fact that such Person ceases to
     exist),  such other independent appraiser as may be selected
     by  the  Agent with the reasonable consent of the  Borrower;
     provided  that  if  the  Agent  fails  to  select  such   an
     independent appraiser within 5 Business Days after a request
     by the Borrower to do so, the Borrower may designate such an
     independent appraiser by notice to the Agent.

          "Appropriate  Lender" means, at any time, with  respect
     to  either  the  Term 1 Facility or the Revolving  Credit  1
     Facility,  a  Lender that has a Commitment with  respect  to
     such Facility at such time.

          "Assignment  and  Acceptance" means an  assignment  and
     acceptance  entered  into  by  a  Lender  and  an   Eligible
     Assignee,  and  accepted by the Agent,  in  accordance  with
     Section  9.07  and in substantially the form  of  Exhibit  C
     hereto.

          "Bankruptcy  Code" means Chapter 11 of  the  Bankruptcy
     Code (11 U.S.C.  101 et seq.), as amended or any successor
     statutes thereto.

          "Base Rate" means a fluctuating interest rate per annum
     in  effect from time to time, which rate per annum shall  at
     all times be equal to the highest of:

               (a)  the rate of interest announced publicly by Citibank,
N.A. in New York, New York, from time to time,as Citibank, N.A.'s base
rate;

                                6

               (b)  1/2 of 1% per annum above the Federal Funds Rate; and

               (c)  the sum (adjusted to the nearest 1/4 of 1% or,
if there is no nearest 1/4 of 1%, to the next higher 1/4 of 1%) of (i) 1/2 of
1% per annum, plus (ii) the rate obtained by dividing (A) the latest
three-week moving average of secondary market morning offering
rates in the United States for three-month certificates of
deposit of major United States money market banks, such three-
week moving average (adjusted to the basis of a year of 360 days)
being determined weekly on each Monday (or, if such day is not a
Business Day, on the next succeeding Business Day) for the three-
week period ending on the previous Friday by Citibank, N.A. on
the basis of such rates reported by certificate of deposit
dealers to and published by the Federal Reserve Bank of New York
or, if such publication shall be suspended or terminated, on the
basis of quotations for such rates received by Citibank, N.A.
from three New York certificate of deposit dealers of recognized
standing selected by Citibank, N.A., by (B) a percentage equal to
100% minus the average of the daily percentages specified during
such three-week period by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum
reserve requirement (including, but not limited to, any
emergency, supplemental or other marginal reserve requirement)
for Citibank, N.A. with respect to liabilities consisting of or
including (among other liabilities) three-month U.S. dollar non-
personal time deposits in the United States, plus (iii) the
average during such three-week period of the annual assessment
rates estimated by Citibank, N.A. for determining the then
current annual assessment payable by Citibank, N.A. to the
Federal Deposit Insurance Corporation (or any successor) for
insuring the U.S. dollar deposits of Citibank, N.A. in the United
States.

          "Base   Rate  Advance"  means  an  Advance  that  bears
     interest as provided in Section 2.06(a)(i).

          "Benefit  Arrangement" means at any  time  an  employee
     benefit  plan  within the meaning of Section 3(3)  of  ERISA
     which  is  not a Plan or a Multiemployer Plan and  which  is
     maintained or otherwise contributed to by any member of  the
     ERISA Group.

          "Borrower" has the meaning specified in the recital  of
     parties to this Agreement.

          "Borrower's Account" means the account of the  Borrower
     maintained by the Borrower with JPMorgan Chase Bank, N.A. at
     its  office  at One Chase Plaza, New York, New  York  10081,
     Account  No.  910-1-019884, or such  other  account  as  the
     Borrower shall specify in writing to the Agent.

          "Borrowing"  means a Term 1 Borrowing  or  a  Revolving
     Credit 1 Borrowing.

          "Business  Day" means a day of the year on which  banks
     are  not required or authorized by law to close in New  York
     City  and,  if  the applicable Business Day relates  to  any
     Eurodollar  Rate Advances, on which dealings are carried  on
     in the London interbank market.

                                7

          "Cash Collateral Account" has the meaning set forth  in
     the Aircraft Security Agreement.

          "Cash Collateral Value" means, with respect to any cash
     and/or  Permitted Investments in or being  deposited  in  or
     credited  to  the Cash Collateral Account at any  time,  the
     face value thereof.

          "Cash  Flow Coverage Ratio" means, with respect to  any
     period,  the ratio of Covenant Cash Flow for such period  to
     Fixed Charges for such period.

          "Change in Control" means such time as at any time, (i)
     AMR shall cease to own directly 100% of the Equity Interests
     in  the  Borrower;  (ii) a "person" or "group"  (within  the
     meaning of Sections 13(d) and 14(d)(2) of the Exchange Act),
     other  than  an Employee Benefit Plan or any AMR Subsidiary,
     shall  become  the "beneficial owner" (as  defined  in  Rule
     13d-3  under  the Exchange Act), directly or indirectly,  of
     more  than 25% of the total voting power of all classes then
     outstanding  of AMR's Voting Interests; (iii)  one  or  more
     Employee  Benefit  Plans  shall  become  in  aggregate   the
     "beneficial  owner"  (as defined in  Rule  13d-3  under  the
     Exchange Act), directly or indirectly, of more than  40%  of
     the  total  voting power of all classes then outstanding  of
     AMR's  Voting  Interests or (iv) during  any  period  of  24
     consecutive months, individuals who at the beginning of such
     period  constitute AMR's Board of Directors  (together  with
     any  new director whose election by AMR's Board of Directors
     or  whose nomination for election by AMR's stockholders  was
     approved  by a vote of at least two-thirds of the  directors
     then  still  in  office  who either were  directors  at  the
     beginning of such period or whose election or nomination for
     election  was previously so approved) cease for  any  reason
     (other than death or disability) to constitute a majority of
     the directors then in office.

          "Change  in Tax Law" means, with respect to any Lender,
     a  change in or amendment to the Internal Revenue Code or  a
     change  in,  or amendment to, or the entering  into  of,  an
     income  tax treaty between the United States of America  and
     the  jurisdiction where such Lender is a tax resident, or  a
     change  in or amendment to the treasury regulations, or  the
     issuance  of  any rulings, in each case that occurred  after
     such  Lender became a Lender; provided that in the  case  of
     any  Lender claiming exemption from Indemnified Taxes  under
     Section  871(h)  or  881(c) of the  Internal  Revenue  Code,
     "Change  in  Tax  Law" shall be limited to a  change  in  or
     amendment  to the Internal Revenue Code that occurred  after
     such Lender became a Lender.

          "Collateral"  means  the  AA  Collateral  and  the  AMR
     Collateral.

          "Collateral  Documents"  means  the  Aircraft  Security
     Agreement, the SGR Security Agreement, the Pledge Agreement,
     each   of   the   collateral  documents,   instruments   and
     supplements   delivered   pursuant   to   Section    5.01(n)
     (including,  without limitation, the Security Arrangements),
     and each other agreement to which the Borrower or the Parent
     Guarantor  is a party that creates or purports to  create  a
     Lien  in  favor of the Agent for the benefit of the  Secured
     Parties.

                                8


          "Commitment"  means a Term 1 Commitment, an  Additional
     Term  1  Commitment, a Revolving Credit 1 Commitment  or  an
     Additional Revolving Credit 1 Commitment.

          "Communications" has the meaning specified  in  Section
     9.02(b).

          "Confidential Information" means information  that  any
     Loan Party furnishes to the Agent or any Lender in a writing
     designated  as confidential, but does not include  any  such
     information  that is or becomes generally available  to  the
     public or that is or becomes available to the Agent or  such
     Lender from a source other than the Loan Parties.

          "Consolidated" refers to the consolidation of  accounts
     in accordance with GAAP.

          "Consolidated  Net Income" means, for any  period,  the
     consolidated  net  income of the Parent  Guarantor  and  its
     Subsidiaries for such period, before dividends.

          "Contractual Obligation" means, as to any  Person,  any
     provision  of any agreement, instrument or other undertaking
     to which such Person is a party or by which it or any of its
     property is bound.

          "Conversion", "Convert" and "Converted" each refer to a
     conversion  of  Advances of one Type into  Advances  of  the
     other Type pursuant to Section 2.07 or 2.10.

          "Covenant   Cash   Flow"   means,   for   any   period,
     Consolidated  Net  Income  for such  period,  (i)  excluding
     therefrom  (A) any extraordinary items of gain or  loss  for
     such  period, (B) any gain or loss of any other  Person  for
     such  period accounted for on the equity method,  except  to
     the extent of cash distributions received during such period
     and  (C) any non-cash gains or losses for such period,  (ii)
     plus cash payments received (or minus cash payments made) by
     the  Parent  Guarantor  and  its  consolidated  Subsidiaries
     during  such  period in respect of such  non-cash  gains  or
     losses recognized in any previous fiscal quarter, (iii) plus
     the  aggregate amounts deducted in determining  Consolidated
     Net  Income  for  such  period in respect  of  (w)  interest
     expense    (less   capitalized   interest),   (x)    without
     duplication, income taxes, (y) depreciation and amortization
     expense and (z) Rentals.

          "CUSA"  has  the  meaning specified in the  recital  of
     parties to this Agreement.

          "Debt"  of  any  Person  means  at  any  date,  without
     duplication, (i) all obligations of such Person for borrowed
     money  (including  obligations  to  reimburse  any  bank  in
     respect  of amounts paid under a letter of credit or similar
     instrument),  (ii) all obligations of such Person  evidenced
     by  bonds,  debentures, notes or other similar  instruments,
     (iii)  all  obligations of such Person to pay  the  deferred
     purchase  price  of  property  or  services,  except   trade
     accounts payable arising in the ordinary course of business,
     (iv)  all  obligations of such Person as  lessee  which  are
     capitalized in accordance with generally accepted accounting
     principles, (v) all Debt of others secured by a Lien on  any
     asset of such Person, whether or not such Debt is assumed by
     such  Person,  (vi)  all Debt of others Guaranteed  by  such
     Person,  (vii) all Obligations of such Person  to  purchase,
     redeem,  retire, defease or otherwise make  any  payment  in
     respect of any Equity Interests in such Person or any  other

                                9


     Person  or  any warrants, rights or options to acquire  such
     Equity   Interests,  valued,  in  the  case  of   Redeemable
     Preferred  Interests, at the greater  of  its  voluntary  or
     involuntary liquidation preference plus accrued  and  unpaid
     dividends, (viii) all Obligations of such Person in  respect
     of  Hedge Agreements, valued at the Agreement Value thereof,
     and (ix) all Off-Balance Sheet Obligations of such Person.

          "Deep  Storage"  for  any  Aircraft  means  that   such
     Aircraft  has  been stored (1) with a low expectation  of  a
     return to service, sale or lease within one year and (2)  in
     a manner intended to minimize over a period of more than one
     year  the rate of environmental degradation of the structure
     and  components of such Aircraft during such period, in each
     case,  as  such storage status is reported in good faith  by
     the  Borrower  to  the Agent at the time of  the  applicable
     appraisal.

          "Default" means any Event of Default or any event  that
     would constitute an Event of Default but for the requirement
     that notice be given or time elapse or both.

          "Defaulted  Advance" means, with respect to any  Lender
     at  any time, the portion of any Advance required to be made
     by  such Lender to the Borrower pursuant to Section 2.01  or
     2.02 at or prior to such time that has not been made by such
     Lender  or  by  the  Agent for the account  of  such  Lender
     pursuant  to Section 2.02(d) as of such time.  In the  event
     that  a portion of a Defaulted Advance shall be deemed  made
     pursuant to Section 2.17(a), the remaining portion  of  such
     Defaulted  Advance  shall be considered a Defaulted  Advance
     originally required to be made pursuant to Section  2.01  on
     the  same  date as the Defaulted Advance so deemed  made  in
     part.

          "Defaulted Amount" means, with respect to any Lender at
     any  time, any amount required to be paid by such Lender  to
     the  Agent or any other Lender hereunder or under any  other
     Financing  Document at or prior to such time  that  has  not
     been so paid as of such time, including, without limitation,
     any  amount  required to be paid by such Lender to  (a)  the
     Agent pursuant to Section 2.02(d) to reimburse the Agent for
     the  amount of any Advance made by the Agent for the account
     of   such   Lender,  (b)  any  other  Lender   pursuant   to
     Section 2.13 to purchase any participation in Advances owing
     to  such  other Lender and (c) the Agent pursuant to Section
     8.05  to reimburse the Agent for such Lender's ratable share
     of any amount required to be paid by the Lender to the Agent
     as  provided  therein.  In the event that  a  portion  of  a
     Defaulted  Amount shall be deemed paid pursuant  to  Section
     2.17(b),  the  remaining portion of  such  Defaulted  Amount
     shall  be  considered a Defaulted Amount originally required
     to  be  paid hereunder or under any other Financing Document
     on  the same date as the Defaulted Amount so deemed paid  in
     part.

          "Defaulting  Lender"  means, at any  time,  any  Lender
     that,  at  such  time,  (a) owes a Defaulted  Advance  or  a
     Defaulted  Amount  or (b) shall take any action  or  be  the
     subject  of any action or proceeding of a type described  in
     Section 6.01(f).

          "Disclosure Documents" means, at any time,  the  annual
     report of the Borrower on Form 10-K (or any successor  form)
     most  recently filed by it with the Securities and  Exchange
     Commission  pursuant  to  Section  13(a)  or  15(d)  of  the
     Exchange  Act and the quarterly and current reports  of  the

                                10

     Borrower  on Form 10-Q or 8-K (or any successor  forms),  if
     any,  so  filed with the Securities and Exchange  Commission
     since the filing of such most recently filed annual report.

          "Dollars"  and the "$" sign each means lawful  currency
     of the United States of America.

          "Domestic  Lending Office" means, with respect  to  any
     Lender, the office of such Lender specified as its "Domestic
     Lending Office" opposite its name on Schedule I hereto or in
     the Assignment and Acceptance pursuant to which it became  a
     Lender,  as  the case may be, or such other office  of  such
     Lender  as such Lender may from time to time specify to  the
     Borrower and the Agent.

          "DOT"  has  the meaning specified in the  SGR  Security
     Agreement.

          "Effective Date" means December 17, 2004.

          "Eligible  Aircraft" means the Aircraft  set  forth  on
     Schedule  1  to the Aircraft Security Agreement  as  of  the
     Effective  Date  and  such  further  Unencumbered  Stage   3
     Aircraft  designated  by  the Borrower  (including,  without
     limitation,   any  such  Replacement  Aircraft);   provided,
     however, that no such Aircraft or additional aircraft  shall
     be  considered to be an Eligible Aircraft at any time unless
     the  Aircraft Security Agreement and the related filings  of
     such Aircraft Security Agreement (or any supplement thereto)
     create  a  valid and perfected lien or security interest  in
     such  aircraft (and all components thereof) in favor of  the
     Agent,  on  behalf  of  the Secured  Parties,  securing  the
     Secured  Obligations, free and clear  of  all  other  Liens,
     other than Permitted Liens.

          "Eligible  Assignee"  means  (i)  a  Lender;  (ii)   an
     Affiliate of a Lender or (iii) any other Person approved  by
     the Agent, such approval not to be unreasonably withheld  or
     delayed, and, unless an Event of Default has occurred and is
     continuing  at  the  time  any  assignment  is  effected  in
     accordance  with Section 9.07, the Borrower,  such  approval
     not  to  be  unreasonably  withheld  or  delayed;  provided,
     however, that neither the Borrower nor an Affiliate  of  the
     Borrower shall qualify as an Eligible Assignee.

          "Eligible  Cash  Collateral"  means  any  cash   and/or
     Permitted Investments on deposit in or credited to the  Cash
     Collateral  Account in which the Agent, for the  benefit  of
     the  Secured Parties, shall have a valid and perfected  lien
     or security interest, free and clear of any other Liens.

          "Employee  Benefit  Plan" means any  "employee  benefit
     plan"  (as  defined in Section 3(3) of ERISA) maintained  by
     the  Borrower, AMR or any Subsidiary of any thereof, or  any
     separate  investment fund or any trust  or  funding  vehicle
     maintained thereunder.

          "Engine"   means   each  of  the  engines   listed   by
     manufacturer's serial number on Schedule 1 to  the  Aircraft
     Security Agreement, as supplemented or amended from time  to

                                11

     time  in accordance with Section 5.01(n), together, in  each
     case,  with any and all Parts so long as the same  shall  be
     incorporated or installed in or attached thereto.

          "Environmental Action" means any action, suit,  demand,
     demand letter, claim, notice of non-compliance or violation,
     notice  of  liability or potential liability, investigation,
     proceeding,  consent order or consent agreement relating  in
     any  way to any Environmental Law, any Environmental  Permit
     or  Hazardous  Material or arising from  alleged  injury  or
     threat  to  health,  safety or the  environment,  including,
     without  limitation, (a) by any governmental  or  regulatory
     authority   for  enforcement,  cleanup,  removal,  response,
     remedial  or  other  actions  or  damages  and  (b)  by  any
     governmental  or  regulatory authority or  third  party  for
     damages,   contribution,  indemnification,  cost   recovery,
     compensation or injunctive relief.

          "Environmental Law" means any federal, state, local  or
     foreign  statute,  law, ordinance, rule,  regulation,  code,
     order,  writ,  judgment, injunction, decree or  judicial  or
     agency  interpretation,  policy  or  guidance  relating   to
     pollution  or protection of the environment, health,  safety
     or  natural resources, including, without limitation,  those
     relating  to  the use, handling, transportation,  treatment,
     storage,   disposal,  release  or  discharge  of   Hazardous
     Materials.

          "Environmental  Permit"  means  any  permit,  approval,
     identification   number,  license  or  other   authorization
     required under any Environmental Law.

          "Equity  Interests" means, with respect to any  Person,
     shares of capital stock of (or other ownership interests in)
     such  Person,  warrants, options or  other  rights  for  the
     purchase or other acquisition from such Person of shares  of
     capital stock of (or other ownership or profit interests in)
     such Person, securities convertible into or exchangeable for
     shares of capital stock of (or other ownership interests in)
     such  Person or warrants, rights or options for the purchase
     or  other  acquisition from such Person of such  shares  (or
     such other interests), and other ownership interests in such
     Person  (including, without limitation, partnership,  member
     or  trust  interests therein), whether voting or  nonvoting,
     and whether or not such shares, warrants, options, rights or
     other interests are authorized or otherwise existing on  any
     date of determination.

          "ERISA"  means the Employee Retirement Income  Security
     Act  of  1974,  as  amended  from  time  to  time,  and  the
     regulations promulgated and rulings issued thereunder.

          "ERISA Group" means the Borrower and all members  of  a
     controlled   group  of  corporations  and  all   trades   or
     businesses  (whether  or  not  incorporated)  under   common
     control which, together with the Borrower, are treated as  a
     single  employer under Section 414(b), (c)  or  (m)  of  the
     Internal Revenue Code.

          "Escrow  Bank"  has  the meaning specified  in  Section
     2.17(c).

          "Eurocurrency Liabilities" has the meaning specified in
     Regulation  D  of  the  Board of Governors  of  the  Federal
     Reserve System, as in effect from time to time.

                                12


          "Eurodollar Lending Office" means with respect  to  any
     Lender,  the  office  of  such  Lender  specified   as   its
     "Eurodollar Lending Office" opposite its name on Schedule  I
     hereto or in the Assignment and Acceptance pursuant to which
     it  became a Lender (or, if no such office is specified, its
     Domestic  Lending  Office), or such  other  office  of  such
     Lender  as such Lender may from time to time specify to  the
     Borrower and the Agent.

          "Eurodollar  Rate" means, for any Interest  Period  for
     all  Eurodollar Rate Advances comprising part  of  the  same
     Borrowing, an interest rate per annum equal to the rate  per
     annum  obtained by dividing (a) the rate per annum  (rounded
     upwards, if necessary, to the nearest 1/100 of 1%) appearing
     on  Telerate Page 3750 (or any successor page) as the London
     interbank offered rate for deposits in U.S. dollars at 11:00
     A.M. (London time) two Business Days before the first day of
     such  Interest  Period for a period equal to  such  Interest
     Period  (provided that, if for any reason such rate  is  not
     available,  the term "Eurodollar Rate" shall mean,  for  any
     Interest  Period for all Eurodollar Rate Advances comprising
     part  of  the  same Borrowing, the rate per  annum  (rounded
     upwards, if necessary, to the nearest 1/100 of 1%) appearing
     on  Reuters Screen LIBO Page as the London interbank offered
     rate  for  deposits in Dollars at approximately  11:00  A.M.
     (London  time) two Business Days prior to the first  day  of
     such  Interest Period for a term comparable to such Interest
     Period);  provided,  however,  if  more  than  one  rate  is
     specified  on Reuters Screen LIBO Page, the applicable  rate
     shall  be  the arithmetic mean of all such rates) by  (b)  a
     percentage  equal to 100% minus the Eurodollar Rate  Reserve
     Percentage for such Interest Period.

          "Eurodollar Rate Advance" means an Advance  that  bears
     interest as provided in Section 2.06(a)(ii).

          "Eurodollar  Rate Reserve Percentage" for any  Interest
     Period  for all Eurodollar Rate Advances comprising part  of
     the  same  Borrowing means the reserve percentage applicable
     two  Business  Days before the first day  of  such  Interest
     Period  under regulations issued from time to  time  by  the
     Board  of  Governors of the Federal Reserve System  (or  any
     successor)  for determining the maximum reserve  requirement
     (including,  without limitation, any emergency, supplemental
     or  other marginal reserve requirement) for a member bank of
     the Federal Reserve System in New York City with respect  to
     liabilities   or   assets   consisting   of   or   including
     Eurocurrency  Liabilities  (or with  respect  to  any  other
     category  of liabilities that includes deposits by reference
     to  which  the interest rate on Eurodollar Rate Advances  is
     determined) having a term equal to such Interest Period.

          "Event of Default" has the meaning specified in Section
     6.01.

          "Event  of  Loss"  has the meaning  set  forth  in  the
     Aircraft Security Agreement.

          "Exchange  Act"  means the Securities Exchange  Act  of
     1934, as amended.

          "Exchange  Ratio"  of  any amount  in  respect  of  any
     Revolving  Credit Lender means a fraction the  numerator  of
     which  is  the  amount  of  such Revolving  Credit  Lender's
     Revolving  Credit  Commitment  immediately  prior   to   the
     Restatement Effective Date and the denominator of  which  is

                                13

     the  aggregate  amount of the Revolving  Credit  Commitments
     immediately prior to the Restatement Effective Date.

          "Existing  Capacity  Agreements"  means  each  of   the
     capacity  purchase agreements existing as of  the  Effective
     Date  and entered into by and among the Borrower and one  or
     more of the Borrower's Affiliates, as such capacity purchase
     agreements are listed on Schedule 1.01 hereto.

          "Existing  Credit Agreement" has the meaning  specified
     in the preliminary statements hereto.

          "FAA" means the Federal Aviation Administration.

          "Facility"  means the Term 1 Facility or the  Revolving
     Credit 1 Facility.

          "Federal   Funds  Rate"  means,  for  any   period,   a
     fluctuating  interest  rate per annum  equal  for  each  day
     during  such period to the weighted average of the rates  on
     overnight  Federal funds transactions with  members  of  the
     Federal Reserve System arranged by Federal funds brokers, as
     published  for such day (or, if such day is not  a  Business
     Day,  for  the next preceding Business Day) by  the  Federal
     Reserve  Bank  of  New  York, or, if such  rate  is  not  so
     published for any day that is a Business Day, the average of
     the  quotations for such day for such transactions  received
     by  the Agent from three Federal funds brokers of recognized
     standing selected by it.

          "Financing Documents" means this Agreement, the  Notes,
     the Collateral Documents and the Parent Guaranty.

          "Financing  Vehicles"  has  the  meaning  specified  in
     Section 5.01(j).

          "Fiscal  Year" means a fiscal year of the Borrower  and
     its  Consolidated subsidiaries ending on December 31 in  any
     calendar year.

          "Fixed  Charges" means, for any period, to  the  extent
     deducted  in  determining Consolidated Net Income  for  such
     period,  interest  expense (less capitalized  interest)  and
     Rentals.

          "GAAP" has the meaning specified in Section 1.03.

          "Gate Leaseholds" has the meaning specified in the  SGR
     Security Agreement.

          "Guarantee"   by  any  Person  means  any   obligation,
     contingent   or  otherwise,  of  such  Person  directly   or
     indirectly guaranteeing any Debt or other obligation of  any
     other  Person  and, without limiting the generality  of  the
     foregoing, any obligation, direct or indirect, contingent or
     otherwise, of such Person (i) to purchase or pay (or advance
     or supply funds for the purchase or payment of) such Debt or
     other  obligation (whether arising by virtue of  partnership
     arrangements, by agreement to keep-well, to purchase assets,
     goods,  securities  or  services,  to  take-or-pay,  or   to
     maintain  financial statement conditions  or  otherwise)  or
     (ii)  entered into for the purpose of assuring in any  other

                                14

     manner  the obligee of such Debt or other obligation of  the
     payment  thereof or to protect such obligee against loss  in
     respect  thereof  (in whole or in part), provided  that  the
     term   "Guarantee"   shall  not  include  endorsements   for
     collection  or deposit in the ordinary course  of  business.
     The  term  "Guarantee" used as a verb  has  a  corresponding
     meaning.

          "Guaranteed  Obligations" for the meaning specified  in
     Section 7.01(a).

          "Hazardous Materials" means (a) petroleum or  petroleum
     products,  by-products  or breakdown  products,  radioactive
     materials,  asbestos-containing  materials,  polychlorinated
     biphenyls  and  radon  gas  and  (b)  any  other  chemicals,
     materials  or substances designated, classified or regulated
     as hazardous or toxic or as a pollutant or contaminant under
     any Environmental Law.

          "Hedge  Agreements" means interest rate  swap,  cap  or
     collar agreements, interest rate future or option contracts,
     currency   swap  agreements,  currency  future   or   option
     contracts  and other hedging agreements (including,  without
     limitation, any commodity and fuel hedging agreements).

          "Indemnified  Costs"  has  the  meaning  specified   in
     Section 8.05(a).

          "Indemnified  Party"  has  the  meaning  specified   in
     Section 9.04(b).

          "Indemnified Taxes" means, with respect to any Agent or
     Lender,  any  Taxes other than (a) any Tax  imposed  by  the
     state  or foreign jurisdiction under the laws of which  such
     Lender  or  Agent, as the case may be, is organized  or  any
     political  subdivision thereof and,  in  the  case  of  each
     Lender,  any  tax  that is imposed by the state  or  foreign
     jurisdiction of such Lender's Applicable Lending  Office  or
     any  political subdivision thereof, (b) any Tax  that  would
     not  have  been  imposed but for a connection  between  such
     Lender  or Agent or its branch, affiliate, principal  office
     or  Applicable Lending Office and the jurisdiction  imposing
     such  Tax  or any political subdivision thereof  or  therein
     that  is unrelated to the transactions contemplated  by  any
     Financing  Document or performing any obligations, receiving
     any payments or enforcing any rights thereunder, (c) any Tax
     attributable  to  such Lender or Agent's failure  to  comply
     with Section 2.12(e) of this Credit Agreement or any form or
     certificate   delivered  by  such  Lender  or  Agent   being
     incorrect, (d) any Tax attributable to such Lender  changing
     its  Applicable  Lending Office, (e) any Tax  imposed  as  a
     result  of  such  Agent or Lender not  being  treated  as  a
     beneficial owner of its Note for federal income tax purposes
     or  (f) any Tax arising as a result of the Agent making  any
     payment  hereunder or under the Notes or the other Financing
     Documents  through an account or branch outside  the  United
     States;  provided that in the case of Taxes imposed  by  the
     United  States, Indemnified Taxes shall only  include  Taxes
     imposed  as  a  result of a Change in  Tax  Law  except  the
     limitation set forth in this proviso shall not apply to  the
     extent  that  a Lender (its transferor or its  assignor,  if
     any)  was  entitled  at  the time of designation  of  a  new
     Lending  Office  (or  transfer  or  assignment)  to  receive
     additional  amounts from any Loan Party pursuant to  Section
     2.12 of this Agreement.

                                15


          "Initial   Extension  of  Credit"  means  the   initial
     borrowing  made  on  the Effective Date under  the  Existing
     Credit Agreement.

          "Initial    Lenders"   means   the   banks,   financial
     institutions and other institutional lenders listed  on  the
     signature pages hereto.

          "Interest  Period"  means,  for  each  Eurodollar  Rate
     Advance  comprising part of the same Borrowing,  the  period
     commencing  on the date of such Eurodollar Rate  Advance  or
     the  date  of  the Conversion of any Base Rate Advance  into
     such Eurodollar Rate Advance, and ending on the last day  of
     the   period  selected  by  the  Borrower  pursuant  to  the
     provisions  below  and, thereafter, each  subsequent  period
     commencing  on  the  last day of the  immediately  preceding
     Interest  Period and ending on the last day  of  the  period
     selected  by the Borrower pursuant to the provisions  below.
     The duration of each such Interest Period shall be one, two,
     three  or  six  months  as  the Borrower  may,  upon  notice
     received  by the Agent not later than 11:00 A.M.  (New  York
     City time) on the third Business Day prior to the first  day
     of such Interest Period, select; provided, however, that:

               (a)  the Borrower may not select any Interest Period with respect
          to any Eurodollar Rate Advance under a Facility that ends after
          any principal repayment installment date for such Facility
          unless, after giving effect to such selection, the aggregate
          principal amount of Base Rate Advances and of Eurodollar Rate
          Advances having Interest Periods that end on or prior to such
          principal repayment installment date for such Facility shall be
          at least equal to the aggregate principal amount of Advances
          under such Facility due and payable on or prior to such date;

               (b)  Interest Periods commencing on the same date for Eurodollar
          Rate Advances comprising part of the same Borrowing shall be of
          the same duration;

               (c)  whenever the last day of any Interest Period would otherwise
          occur on a day other than a Business Day, the last day of such
          Interest Period shall be extended to occur on the next succeeding
          Business Day; provided, however, that, if such extension would
          cause the last day of such Interest Period to occur in the next
          following calendar month, the last day of such Interest Period
          shall occur on the next preceding Business Day; and

               (d)  whenever the first day of any Interest Period occurs on a
          day of an initial calendar month for which there is  no
          numerically corresponding day in the calendar month that succeeds
          such initial calendar month by the number of months equal to the
          number of months in such Interest Period, such Interest Period
          shall end on the last Business Day of such succeeding calendar
          month.

          "Internal Revenue Code" means the Internal Revenue Code
     of 1986, as amended from time to time.

          "Lead  Arrangers"  has  the meaning  specified  in  the
     recital of parties to this Agreement.

                                16


          "Lenders" means the Term 1 Lenders, Revolving Credit  1
     Lenders,  the  Additional  Term 1  Lenders,  the  Additional
     Revolving Credit 1 Lenders and each Person that shall become
     a  party hereto pursuant to Section 9.07 for so long as such
     Term 1 Lender, Revolving Credit 1 Lender, Additional Term  1
     Lender,  Additional Revolving Credit 1 Lender or Person,  as
     the case may be, shall be a party to this Agreement.

          "Lien"  means, with respect to any asset, any mortgage,
     lien,  pledge,  charge, security interest or encumbrance  of
     any kind in respect of such asset.  For the purposes of this
     Agreement, the Borrower or any Subsidiary shall be deemed to
     own  subject  to a Lien any asset which it has  acquired  or
     holds  subject to the interest of a vendor or  lessor  under
     any conditional sale agreement, capital lease or other title
     retention agreement relating to such asset.

          "Loan  Parties"  means  the  Borrower  and  the  Parent
     Guarantor.

          "Material Adverse Effect" means (i) a material  adverse
     effect  on  the business, assets, operations, properties  or
     condition (financial or otherwise) of the Borrower  and  its
     Subsidiaries,  taken  as a whole, (ii)  a  material  adverse
     effect  on  the  ability  of  the  Borrower  or  the  Parent
     Guarantor  to  perform its obligations under  the  Financing
     Documents  or (iii) a material adverse effect on the  rights
     and remedies of the Agent or the Lenders under the Financing
     Documents.

          "Material Contract" means, with respect to any  Person,
     each  contract (as in effect from time to time, as  amended,
     amended and restated, supplemented or otherwise modified) to
     which  such  Person is a party and that is material  to  the
     business,  condition  (financial or otherwise),  operations,
     performance or properties of such Person.

          "Material  Plan" means, at any time, a  Plan  or  Plans
     having   aggregate  Unfunded  Liabilities   in   excess   of
     $25,000,000.

          "Material   Subsidiary"  means  any   Subsidiary   that
     constitutes  a  "significant  subsidiary"  of  the  Borrower
     within  the meaning of Regulation S-X of the Securities  and
     Exchange Commission (as in effect on the date hereof).

          "Moody's" means Moody's Investors Service, Inc. and any
     successor thereto.

          "Multiemployer  Plan"  means at any  time  an  employee
     pension   benefit  plan  within  the  meaning   of   Section
     4001(a)(3)  of ERISA to which any member of the ERISA  Group
     is   then   making  or  accruing  an  obligation   to   make
     contributions  or has within the preceding five  plan  years
     made  contributions, including for these purposes any Person
     which  ceased to be a member of the ERISA Group during  such
     five year period.

          "Narita Collateral" means all of the Borrower's  Narita
     Routes,  Slots, Narita Slots, Gate Leaseholds and Supporting
     Route Facilities.

          "Narita  Routes" has the meaning specified in  the  SGR
     Security Agreement.

          "Narita  Slots" has the meaning specified  in  the  SGR
     Security Agreement.


                                17

          "Net Worth" means the excess of total assets over total
     liabilities.

          "Note"  means  a  Term 1 Note or a Revolving  Credit  1
     Note, as the context may require.

          "Notice  of  Borrowing" has the  meaning  specified  in
     Section 2.02(a).

          "Obligation"  means, with respect to  any  Person,  any
     payment,  performance or other obligation of such Person  of
     any  kind,  including, without limitation, any liability  of
     such  Person on any claim, whether or not the right  of  any
     creditor  to payment in respect of such claim is reduced  to
     judgment,   liquidated,  unliquidated,  fixed,   contingent,
     matured, disputed, undisputed, legal, equitable, secured  or
     unsecured,  and  whether or not such  claim  is  discharged,
     stayed  or otherwise affected by any proceeding referred  to
     in  Section 6.01(f).  Without limiting the generality of the
     foregoing,  the  Obligations of any  Loan  Party  under  the
     Financing  Documents  include  (a)  the  obligation  to  pay
     principal,  interest,  charges, expenses,  fees,  attorneys'
     fees   and  disbursements,  indemnities  and  other  amounts
     payable by such Loan Party under any Financing Document  and
     (b)  the  obligation  of such Loan Party  to  reimburse  any
     amount  in respect of any of the foregoing that any  Lender,
     in  its  sole  discretion, may elect to pay  or  advance  on
     behalf of such Loan Party.

          "Off  Balance Sheet Obligation" means, with respect  to
     any  Person,  without duplication of any clause within  this
     definition   or  within  the  definition  of   "Debt",   all
     (a)  Obligations  of such Person under any  lease  which  is
     treated  as  an  operating  lease for  financial  accounting
     purposes  and  a financing lease for tax purposes  (i.e.,  a
     "synthetic  lease"),  (b)  Obligations  of  such  Person  in
     respect  of  transactions entered into by such  Person,  the
     proceeds  from  which would be reflected  on  the  financial
     statements  of such Person in accordance with GAAP  as  cash
     flows  from  financings  at the time  such  transaction  was
     entered  into  (other than as a result of  the  issuance  of
     Equity  Interests)  and (c) Obligations of  such  Person  in
     respect  of  other transactions entered into by such  Person
     that are not otherwise addressed in the definition of "Debt"
     or  in clause (a) or (b) above that are intended to function
     primarily  as  a  borrowing  of  funds  (including,  without
     limitation, any minority interest transactions that function
     primarily as a borrowing).

          "Other  Taxes"  has  the meaning specified  in  Section
     2.12(b).

          "Parent Guarantor" means AMR.

          "Parent  Guaranty" means the Guarantee  of  the  Parent
     Guarantor set forth in Article VII.

          "Parts"  has  the  meaning set forth  in  the  Aircraft
     Security Agreement.

          "PBGC"  means the Pension Benefit Guaranty  Corporation
     (or any successor).

          "Permitted  Investments" means any  Dollar  denominated
     investment in (i) direct obligations of the United States or
     any  agency thereof, or obligations guaranteed by the United
     States or any agency thereof, (ii) commercial paper rated at
     least  A-2 by S&P and P-2 by Moody's or (iii) time  deposits

                                18

     with,  including  certificates of  deposit  issued  by,  any
     office  located in the United States of any  bank  or  trust
     company  which  is organized under the laws  of  the  United
     States  or  any state thereof and has capital,  surplus  and
     undivided   profits   aggregating  at  least   $500,000,000,
     provided in the case of each of the investments referred  to
     in  clauses  (i)  through (iii) above, (x)  such  investment
     matures  within  six  months from the  date  of  acquisition
     thereof by the Agent and (y) in order to provide the  Agent,
     for  the  benefit of the Secured Parties, with  a  perfected
     security  interest therein, each Permitted Investment  shall
     be  either:   (A)  evidenced by negotiable  certificates  or
     instruments, or if non-negotiable then issued in the name of
     the  Agent, which (together with any appropriate instruments
     of transfer) are delivered to, and held by, the Agent or any
     agent thereof (which shall not be the Borrower or any of its
     affiliates)  in the State of New York; or (B) in  book-entry
     form  and issued by the United States and subject to  pledge
     under  applicable state law and Treasury regulations and  as
     to   which  (in  the  opinion  of  counsel  to  the   Agent)
     appropriate measures shall have been taken for perfection of
     the  security interests created under the Aircraft  Security
     Agreement and (iv) such other investments of credit  quality
     not  lower  than  that  of the investments  referred  to  in
     clauses  (i)  through  (iii) above and maturing  within  six
     months from the date of acquisition thereof by the Agent, as
     to   which   the  Agent  shall  have  received  satisfactory
     assurances  that appropriate measures shall have been  taken
     for  perfection of the security interests created under  the
     Aircraft Security Agreement.

          "Permitted Liens" means:

               (1)   the  respective rights and interests created
          by  or  pursuant  to  or resulting from  the  Financing
          Documents, and the respective rights of the  Agent  and
          the Loan Parties as therein provided;

               (2)   the  rights  of others under  agreements  or
          arrangements  to  the  extent  expressly  permitted  by
          Sections  5.02(a) and 5.04(b) of the Aircraft  Security
          Agreement   or  by  the  terms  of  the  SGR   Security
          Agreement;

               (3)   Liens for taxes either not yet due or  being
          contested in good faith (and for the payment  of  which
          adequate  reserves have been provided)  by  appropriate
          proceedings so long as such proceedings do not  involve
          any  substantial danger of the sale, forfeiture or loss
          of any Airframe or any Engine, or any interest therein;

               (4)     materialmen's,    mechanics',    workers',
          repairmen's, employees', or other Liens arising in  the
          ordinary course of business for amounts the payment  of
          which   is  either  not  yet  delinquent  or  is  being
          contested in good faith (and for the payment  of  which
          adequate  reserves have been provided)  by  appropriate
          proceedings so long as such proceedings do not  involve
          any  substantial danger of the sale, forfeiture or loss
          of any Airframe or any Engine, or any interest therein;

               (5)   Liens  (other than Liens for taxes)  arising
          out  of judgments or awards against any Loan Party with
          respect  to  which at the time an appeal or  proceeding

                                19

          for  review is being prosecuted in good faith and  with
          respect to which there shall have been secured  a  stay
          of  execution  pending such appeal  or  proceeding  for
          review,  and which such Liens relate to any  Collateral
          only  as  a  result of a general Lien on the assets  of
          such  Loan Party in one or more jurisdictions  and  are
          not  entitled  to priority with respect  to  Collateral
          over any Lien created by the Collateral Documents;

               (6)   salvage or similar rights of insurers  under
          insurance policies maintained pursuant to Section  5.06
          of the Aircraft Security Agreement; and

               (7)   Liens  arising after the Effective  Date  to
          satisfy a condition for granting or modifying a  waiver
          of  the  minimum  funding  standards  or  extension  of
          amortization periods under Section 412 of the  Internal
          Revenue  Code  in  respect  of  a  Plan,  provided  the
          interests  and rights under such Liens are subordinated
          to  the claims, rights and interests of the Lenders and
          Agent   under  the  Financing  Documents   upon   terms
          reasonably satisfactory to the Agent.

          "Person"  means an individual, partnership, corporation
     (including  a  business trust), limited  liability  company,
     joint  stock  company,  trust,  unincorporated  association,
     joint  venture  or  other entity, or  a  government  or  any
     political subdivision or agency thereof.

          "Plan"  means  at any time an employee pension  benefit
     plan  (other than a Multiemployer Plan) which is covered  by
     Title  IV  of  ERISA  or  subject  to  the  minimum  funding
     standards under Section 412 of the Internal Revenue Code and
     either  (i) is maintained, or contributed to, by any  member
     of  the ERISA Group for employees of any member of the ERISA
     Group  or  (ii)  has at any time within the  preceding  five
     years  been  maintained, or contributed to,  by  any  Person
     which  was  at  such time a member of the  ERISA  Group  for
     employees  of any Person which was at such time a member  of
     the ERISA Group.

          "Platform"   has  the  meaning  specified  in   Section
     9.02(c).

          "Pledge   Agreement"  means  a  pledge   agreement   in
     substantially  the form of Exhibit F to the Existing  Credit
     Agreement, as amended.

          "Preferred  Interests"  means,  with  respect  to   any
     Person,  Equity  Interests issued by such  Person  that  are
     entitled  to a preference or priority over any other  Equity
     Interests  issued  by such Person upon any  distribution  of
     such  Person's property and assets, whether by  dividend  or
     upon liquidation.

          "Pricing Level" means, as of any date of determination,
     the  level set forth as then in effect for the Borrower,  as
     determined  in  accordance with the following provisions  of
     this definition:

          Level 1:  Senior Secured Debt Rating of not lower  that
                    BB by S&P and not lower than Ba3 by Moody's.

                                20


          Level 2:  Level  1  does not apply and a Senior Secured
                    Debt Rating of not lower than BB- by S&P  and
                    not lower than B1 by Moody's.

          Level 3:  Level  1  and  2 do not apply  and  a  Senior
                    Secured Debt Rating of not lower than  B+  by
                    S&P and not lower than B2 by Moody's.

          Level 4:  Levels 1, 2 and 3 do not apply.

          "Redeemable"   means,  with  respect  to   any   Equity
     Interest,  any such Equity Interest that (a) the issuer  has
     undertaken  to  redeem  at a fixed or determinable  date  or
     dates,  whether by operation of a sinking fund or otherwise,
     or  upon the occurrence of a condition not solely within the
     control of the issuer or (b) is redeemable at the option  of
     the holder.

          "Register"   has  the  meaning  specified  in   Section
     9.07(c).

          "Regulation  U"  means Regulation U  of  the  Board  of
     Governors  of the Federal Reserve System, as in effect  from
     time to time.

          "Rentals"  means the aggregate amounts payable  by  the
     Parent  Guarantor or any Subsidiary, as lessee, to a  lessor
     with  respect to and pursuant to the terms of any  operating
     lease for a specified period.

          "Replacement Aircraft" means any Unencumbered  Stage  3
     Aircraft of which a Replacement Airframe is part.

          "Replacement   Airframe"  means  an  airframe   (except
     Engines  or  engines  from time to time  installed  thereon)
     constituting part of an Unencumbered Stage 3 Aircraft, which
     shall have been added to Schedule 1 to the Aircraft Security
     Agreement  or  made  subject to the  Lien  of  the  Aircraft
     Security Agreement pursuant to Section 5.01(n)(iii) or  (v),
     together with all Parts relating to such airframe.

          "Replacement Engine" means an engine of make and  model
     suitable  for  use on any Airframe or Replacement  Airframe,
     which  shall  have been added to Schedule 1 to the  Aircraft
     Security Agreement pursuant to Section 5.01(n)(iii) or  (v),
     together with all Parts relating to such engine.

          "Required  Collateral Amount" means, at any  time,  the
     sum  of  (a) the aggregate amount of the Revolving Credit  1
     Commitments  at  such time, or if such  Revolving  Credit  1
     Commitments shall have been terminated, an amount  equal  to
     the  aggregate  unpaid  principal amount  of  the  Revolving
     Credit 1 Advances, plus (b) an amount equal to the aggregate
     unpaid principal amount of the Term 1 Advances.

          "Required Lenders" means, at any time, Lenders owed  or
     holding  at least a majority in interest of the sum  of  (a)
     the  aggregate principal amount of the Advances  outstanding
     at such time and (b) the aggregate unused Revolving Credit 1
     Commitments  at such time; provided, however,  that  if  any
     Lender  shall  be  a Defaulting Lender at such  time,  there

                                21

     shall be excluded from the determination of Required Lenders
     at  such  time  (A) the aggregate principal  amount  of  the
     Advances owing to such Lender (in its capacity as a  Lender)
     and  outstanding  at such time and (B) the unused  Revolving
     Credit 1 Commitment of such Lender at such time.

          "Responsible   Officer"  means  any  senior   executive
     officer,  senior  accounting officer  or  treasurer  of  the
     Borrower,  or  any  vice  president,  director  or  managing
     director  of  the  Borrower having  responsibility  for  the
     administration of this Agreement.

          "Restatement Effective Date" has the meaning  specified
     in Section 3.01.

          "Restatement  Initial Extension of  Credit"  means  the
     initial  Borrowing  on  or after the  Restatement  Effective
     Date.

          "Revolving Credit Advance" has the meaning specified in
     Section 1.01 of the Existing Credit Agreement.

          "Revolving  Credit Facility" has the meaning  specified
     in Section 1.01 of the Existing Credit Agreement.

          "Revolving Credit Lender" has the meaning specified  in
     Section 1.01 of the Existing Credit Agreement.

          "Revolving  Credit Note" has the meaning  specified  in
     Section 1.01 of the Existing Credit Agreement.

          "Revolving Credit 1 Advance" means a revolving loan  or
     revolving loans made by a Revolving Credit 1 Lender pursuant
     to Section 2.01(b)(i) or Section 2.01(b)(iii) or deemed made
     pursuant to Section 2.01(b)(ii).

          "Revolving  Credit  1  Borrowing"  means  a   borrowing
     consisting  of simultaneous Revolving Credit 1  Advances  of
     the same Type made by each of the Revolving Credit 1 Lenders
     pursuant to Section 2.01(b).

          "Revolving  Credit  1 Commitment" means,  collectively,
     (a)  with  respect  to  each Revolving  Credit  Lender  that
     executes  and  delivers this Agreement on or  prior  to  the
     Restatement  Effective Date, the amount set  forth  opposite
     such  Revolving Credit 1 Lender's name on Schedule I  hereto
     under  the  caption  "Revolving Credit  1  Commitment",  and
     (b)  with  respect  to each Additional  Revolving  Credit  1
     Lender that is not a Revolving Credit Lender, its Additional
     Revolving  Credit  1 Commitment or, in each  case,  if  such
     Lender   has  entered  into  one  or  more  Assignment   and
     Acceptances,  the amount set forth for such  Lender  in  the
     Register maintained by the Agent pursuant to Section 9.07(c)
     as  such Lender's "Total Revolving Credit 1 Commitment",  as
     such amount may be reduced at or prior to such time pursuant
     to Section 2.04.

          "Revolving Credit 1 Facility" means, at any  time,  the
     aggregate   amount  of  the  Revolving  Credit  1   Lenders'
     Revolving Credit 1 Commitments at such time.

                                22

          "Revolving  Credit  1 Lender" means, collectively,  (a)
     each Revolving Credit Lender that executes and delivers this
     Agreement on or prior to the Restatement Effective Date  and
     (b)  each Additional Revolving Credit 1 Lender that  is  not
     otherwise referred to in clause (a) of this definition.

          "Revolving  Credit 1 Note" means a promissory  note  of
     the Borrower payable to the order of any Revolving Credit  1
     Lender,  in  substantially the form of Exhibit  A-1  hereto,
     evidencing  the  aggregate indebtedness of the  Borrower  to
     such  Revolving Credit 1 Lender resulting from the Revolving
     Credit  1  Advances  made or deemed made by  such  Revolving
     Credit 1 Lender, as amended.

          "S&P"  means  Standard  & Poor's  Ratings  Services,  a
     division  of  The  McGraw-Hill  Companies,  Inc.   and   any
     successor thereto.

          "Secured Obligations", in respect of the AA Collateral,
     has  the  meaning  specified in Section 2  of  each  of  the
     Aircraft  Security Agreement and the SGR Security Agreement,
     and,  in  respect  of the AMR Collateral,  has  the  meaning
     specified in Section 2 of the Pledge Agreement.

          "Secured Parties" means the Agent and the Lenders.

          "Security  Arrangements" has the meaning set  forth  in
     Section 5.01(n)(ii).

          "Security  Opinions" means, with respect  to  any  item
     referred  to  in  Section 5.01(n), (a)  an  opinion  of  the
     General Counsel of the Borrower substantially in the form of
     Exhibit  H-1  to the Existing Credit Agreement  and  (b)  an
     opinion of Daugherty Fowler Peregrin & Haught (or such other
     counsel acceptable to the Required Lenders) substantially in
     the form of Exhibit H-2 to the Existing Credit Agreement.

          "Senior Secured Debt Rating" means, as of any date, the
     senior  secured  debt  rating that has  been  most  recently
     announced  by  Moody's  or  S&P  for  the  Facilities.   For
     purposes  of  the  foregoing, (a) if only  one  of  S&P  and
     Moody's  shall have in effect a Senior Secured Debt  Rating,
     the  Applicable Margin shall be determined by  reference  to
     the  available rating; (b) if both S&P and Moody's shall not
     have  in effect a Senior Secured Debt Rating, the Applicable
     Margin  will  be set in accordance with Level  4  under  the
     definition  of  "Applicable  Margin";  (c)  if  any   rating
     established by S&P or Moody's shall be changed, such  change
     shall  be  effective as of the date on which such change  is
     first  announced publicly by the rating agency  making  such
     change; and (d) if S&P or Moody's shall change the basis  on
     which  ratings are established, each reference to the Senior
     Secured Debt Rating announced by S&P or Moody's, as the case
     may be, shall refer to the then equivalent rating by S&P  or
     Moody's, as the case may be.

          "SGR Security Agreement" means the slot, gate and route
     security agreement in substantially the form of Exhibit F to
     the Existing Credit Agreement, as amended.

          "Short  Term  Investments" means, as  of  any  date  of
     determination, any US dollar denominated investment in:  (i)
     direct  obligations  of  the United  States  or  any  agency
     thereof,  or guaranteed by the United States or  any  agency
     thereof;  (ii)  commercial  paper  issued  by  corporations,

                                23

     sovereigns  or special purpose entities (i.e., asset  backed
     commercial  paper)  rated at least A-1 by  S&P  and  P-1  by
     Moody's;  (iii) certificates of deposit, time  deposits  and
     bank  notes of any bank or trust company rated not less than
     A  by  S&P  and  A2 by Moody's; (iv) corporate or  municipal
     securities  rated not less than A by S&P and A2 by  Moody's;
     and  (v)  mortgage backed and asset backed securities  rated
     not  less than A by S&P and A2 by Moody's; provided  in  the
     case  of each of the investments referred to in clauses  (i)
     through  (v) above, such investment matures within  eighteen
     months from the date of such determination.

          "Slots"  has the meaning specified in the SGR  Security
     Agreement.

          "Subsidiary"  means  any  corporation  of   which   the
     Borrower and/or one or more Subsidiaries at the time owns or
     controls,  directly  or indirectly, more  than  50%  of  the
     shares  of stock having general voting power under  ordinary
     circumstances to elect a majority of the board of directors,
     managers  or  trustees of such corporation (irrespective  of
     whether  or  not  at the time stock of any  other  class  or
     classes of such corporation shall have or might have  voting
     power by reason of the happening of any contingency).

          "Supplemental  Agent"  has  the  meaning  specified  in
     Section 8.01(c).

          "Supporting Route Facilities" has the meaning specified
     in the SGR Security Agreement.

          "Syndication  Agent" has the meaning specified  in  the
     recital of parties to this Agreement.

          "Taxes"  means  any  present or future  taxes,  levies,
     imposts, deductions, charges or withholdings imposed by  any
     governmental authority.

          "Temporary  Storage" for any Aircraft means  that  such
     Aircraft  (A)  has been stored (1) without  a  scheduled  or
     planned return to active service, sale or lease and (2) in a
     manner  suitable for an aircraft expected to be returned  to
     service,  sold or leased within one year, (B)  has  been  in
     such  storage for less than one year, and (C) may be removed
     from such storage without material cost for such removal, in
     each  case, as such storage status is reported in good faith
     by  the  Borrower to the Agent at the time of the applicable
     appraisal.

          "Term  Advance"  has the meaning specified  in  Section
     1.01 of the Existing Credit Agreement.

          "Term  Commitment" has the meaning specified in Section
     1.01 of the Existing Credit Agreement.

          "Term Lender" has the meaning specified in Section 1.01
     of the Existing Credit Agreement.

          "Term  Note" has the meaning specified in Section  1.01
     of the Existing Credit Agreement.


                                24

          "Term  1 Advance" means a term loan or term loans  made
     by a Term 1 Lender pursuant to Section 2.01(a)(ii) or deemed
     made pursuant to Section 2.01(a)(i).

          "Term  1  Borrowing"  means a borrowing  consisting  of
     simultaneous Term 1 Advances of the same Type  made  by  the
     Term 1 Lenders pursuant to Section 2.01(a).

          "Term  1  Commitment"  means,  collectively,  (a)  with
     respect to each Term Lender that executes and delivers  this
     Agreement on or prior to the Restatement Effective Date, the
     amount  set  forth  opposite  such  Term  Lender's  name  on
     Schedule  I  hereto, under the caption "Term 1  Commitment",
     and  (b) with respect to each Additional Term 1 Lender  that
     is  not a Term Lender, its Additional Term 1 Commitment  or,
     in  each  case, if such Lender has entered into one or  more
     Assignment  and Acceptances, the amount set forth  for  such
     Lender  in the Register maintained by the Agent pursuant  to
     Section 9.07(c) as such Lender's "Total Term 1 Commitment".

          "Term  1  Facility" means, at any time,  the  aggregate
     amount  of  the Term 1 Lenders' Term 1 Commitments  at  such
     time.

          "Term  1  Lender" means, collectively,  (a)  each  Term
     Lender that executes and delivers this Agreement on or prior
     to  the  Restatement Effective Date and (b) each  Additional
     Term  1  Lender that is not otherwise referred to in  clause
     (a) of this definition.

          "Term  1  Note" means a promissory note of the Borrower
     payable  to the order of any Term 1 Lender, in substantially
     the  form of Exhibit A-2 hereto, evidencing the indebtedness
     of  the  Borrower to such Lender resulting from the  Term  1
     Advances made or deemed made by such Lender, as amended.

          "Termination Date" means the earlier of (a) the date of
     termination in whole of the Commitments pursuant to  Section
     2.04 or 6.01 and (b) (i) for purpose of the Revolving Credit
     1 Facility, June 17, 2009 and (ii) for purpose of the Term 1
     Facility, December 17, 2010.

          "Title  49"  has  the  meaning  specified  in  the  SGR
     Security Agreement.

          "Transaction"  means the transactions  contemplated  by
     the Financing Documents.

          "Type"  refers  to  the  distinction  between  Advances
     bearing  interest  at  the Base Rate  and  Advances  bearing
     interest at the Eurodollar Rate.

          "Unencumbered  Stage  3  Aircraft"  means  a  "Stage  3
     airplane" as defined in Title 14, Section 36.1(f)(6) of  the
     Code  of  Federal Regulations consisting of Boeing  737-800,
     757-200,  767-200ER,  767-300ER  and  777-200  aircraft  and
     McDonnell Douglas MD-80 aircraft, in each case owned by  the
     Borrower  and unencumbered by any Lien, other than Permitted
     Liens.

          "Unfunded Liabilities" means, with respect to any  Plan
     at  any  time, the amount (if any) by which (i) the  present
     value of all benefits under such Plan exceeds (ii) the  fair
     market  value of all Plan assets allocable to such  benefits
     (excluding  any  accrued  but  unpaid  contributions),   all

                                25

     determined  as  of the then most recent valuation  date  for
     such   Plan,  but  only  to  the  extent  that  such  excess
     represents  a potential liability of a member of  the  ERISA
     Group  to  the PBGC or any other Person under  Title  IV  of
     ERISA.

          "United  States Citizen" has the meaning  specified  in
     Section 4.01(q).

          "Voting Interests" means shares of capital stock issued
     by  a  corporation, or equivalent Equity  Interests  in  any
     other  Person, the holders of which are ordinarily,  in  the
     absence  of contingencies, entitled to vote for the election
     of  directors  (or persons performing similar functions)  of
     such Person, even if the right so to vote has been suspended
     by the happening of such a contingency.

          SECTION 1.02. Computation of Time Periods; Other
Definitional Provisions. In this Agreement and the other Financing
Documents in the computation of periods of time from a specified
date to  a later  specified date, the word "from" means "from and
including" and  the  words  "to" and "until" each mean "to  but
excluding". References  in  the  Financing  Documents  to  any
agreement  or contract  "as  amended" shall mean and be  a  reference
to  such agreement   or   contract  as  amended,  amended  and
restated, supplemented  or  otherwise  modified  from  time  to time
in accordance with its terms.

          SECTION 1.03. Accounting Terms.   All accounting terms
not specifically defined herein shall   be   construed  in  accordance
with  generally  accepted accounting  principles  consistent  with
those  applied  in  the preparation   of   the  financial  statements
referred to in Sections 4.01(g)(i) and 4.02(e)(i), as applicable ("GAAP").

          SECTION 1.04. Deemed References. Upon  the  Restatement
Effective  Date,  (i)  all references   to   "Term   Advance",
"Term   Borrowing", "Term Commitment", "Term Facility", "Term Lender"
and "Term  Note"  in the  Financing Documents (other than in this
Agreement) shall  be deemed references to "Term 1 Advance", "Term 1
Borrowing", "Term 1  Commitment", "Term 1 Facility", "Term 1 Lender"
and "Term  1 Note", respectively; and (ii) all references to "Revolving
Credit Advance",   "Revolving  Credit  Borrowing",   "Revolving  Credit
Commitment",  "Revolving  Credit  Facility",  "Revolving   Credit
Lender",  and "Revolving Credit Note"  in the Financing Documents
(other  than  in  this Agreement) shall be deemed  references  to
"Revolving  Credit  1 Advance", "Revolving Credit  1  Borrowing",
"Revolving  Credit 1 Commitment", "Revolving Credit 1  Facility",
"Revolving  Credit  1  Lender" and  "Revolving  Credit  1  Note",
respectively.

                           ARTICLE II

                AMOUNTS AND TERMS OF THE ADVANCES

          SECTION 2.01. The Advances.  (a) The Term 1 Advances.

          (i)    Exchange.   Notwithstanding  anything   to   the
contrary  in  Sections 2.11 and 2.13, each Term 1 Lender  with  a
Term  1  Commitment severally agrees, on the terms and conditions
hereinafter set forth, to exchange its Term Advance for a Term  1
Advance  with  a principal amount equal to that of the  exchanged
Term  Advance  on the Restatement  Effective Date, and  from  and
after  the Restatement Effective Date such Term Advance shall  be
deemed  repaid  and refinanced in full and such  Term  1  Advance
shall  be  deemed  made hereunder.  On the Restatement  Effective


                                26

Date,  each  Term  Lender  shall deliver  to  the  Borrower  each
Term Note issued to it, if any.

          (ii)  The  Additional Term 1 Advances.  Each Additional
Term  1  Lender  severally agrees, on the  terms  and  conditions
hereinafter set forth, to make an advance (an "Additional Term  1
Advance") to the Borrower on the Restatement Effective Date in  a
principal amount equal to its Additional Term 1 Commitment.   The
Borrower shall use the proceeds of the Additional Term 1 Advances
to  refinance (i) up to $200 million in Revolving Credit Advances
of  the  Revolving Credit Lenders and (ii) all Term  Advances  of
Term  Lenders  that do not execute and deliver this Agreement  on
the   Restatement  Effective  Date  with  the  proceeds  of   the
Additional Term 1 Advances.  Any Term 1 Advances made and  repaid
or prepaid may not be reborrowed.

          (iii)     Interest.  On the Restatement Effective  Date
the  Borrower  shall pay all accrued and unpaid interest  on  the
Term Advances to the Term Lenders.

          (b)  (i) The Revolving Credit 1 Advances. Each Revolving
Credit 1 Lender severally  agrees,  on  the  terms  and   conditions
hereinafter  set  forth  and  after  giving  effect  to  Sections
2.01(b)(ii)  and 2.01(b)(iii), to make advances to  the  Borrower
from time to time on any Business Day during the period from  the
Restatement  Effective  Date until the  Termination  Date  in  an
amount  for each such Advance not to exceed such Revolving Credit
1  Lender's  Revolving Credit 1 Commitment at  such  time.   Each
Revolving  Credit 1 Borrowing shall be in an aggregate amount  of
$10,000,000  or  an  integral multiple of  $1,000,000  in  excess
thereof and shall consist of Revolving Credit 1 Advances  of  the
same  Type made on the same day by the Revolving Credit 1 Lenders
ratably   according  to  their  respective  Revolving  Credit   1
Commitments.

          (ii)   Exchange.   Notwithstanding  anything   to   the
contrary in Sections 2.11 and 2.13, each Revolving Credit  Lender
with  a  Revolving Credit 1 Commitment severally agrees,  on  the
terms  and conditions hereinafter set forth, to (A) exchange  its
Revolving Credit Advance for a Revolving Credit 1 Advance with  a
principal  amount equal to the product of the aggregate principal
amount  of  all outstanding Revolving Credit 1 Advances  (without
giving  effect  to  any Additional Revolving Credit  1  Advances)
times such Revolving Credit Lender's Exchange Ratio, and from and
after  the  Restatement  Effective  Date  such  Revolving  Credit
Advance  shall be deemed repaid and refinanced to the  extent  of
such  Revolving  Credit  1 Advance and such  Revolving  Credit  1
Advance  shall  be  deemed made hereunder and  (B)  exchange  its
Revolving  Credit Commitment for a Revolving Credit 1  Commitment
in  an amount equal to the product of the aggregate amount of all
Revolving  Credit  1 Commitments (without giving  effect  to  any
Additional  Revolving Credit 1 Commitments) times such  Revolving
Credit  Lender's  Exchange Ratio.  On the  Restatement  Effective
Date,  each Revolving Credit Lender shall deliver to the Borrower
each Revolving Credit Note issued to it, if any.

          (iii)      The  Additional Revolving Credit 1 Advances.
Each  Additional Revolving Credit 1 Lender severally  agrees,  on
the  terms  and  conditions hereinafter set  forth,  to  make  an
advance  (an  "Additional Revolving Credit  1  Advance")  to  the
Borrower on the Restatement Effective Date in a principal  amount
equal  to  its pro rata share (based on such Additional Revolving

                                27

Credit  1  Lender's portion of the aggregate Additional Revolving
Credit  1 Commitments) of the excess of (x) the Revolving  Credit
Advances   outstanding  immediately  prior  to  the   Restatement
Effective Date over (y) the sum of (1) $200 million plus (2)  the
Revolving Credit 1 Advances made by the Revolving Credit  Lenders
on  the Restatement Effective Date.  The Borrower shall refinance
all Revolving Credit Advances of Revolving Credit Lenders that do
not  execute  and  deliver  this  Agreement  on  the  Restatement
Effective  Date  with  the proceeds of the  Additional  Revolving
Credit 1 Advances and the Additional Term 1 Advances.

          (iv)  Interest.  On the Restatement Effective Date  the
Borrower  shall  pay  all  accrued and  unpaid  interest  on  the
Revolving  Credit  Advances  to  the  Revolving  Credit  Lenders;
provided,  however, it is understood that the  existing  Interest
Periods of the Revolving Credit Advances prior to the Restatement
Effective  Date  shall  continue on  and  after  the  Restatement
Effective  Date  for  the Revolving Credit 1  Advances,  and  the
Revolving  Credit  1  Advances  shall  accrue  interest  at   the
Eurodollar  Rate  or  the  Base Rate,  as  applicable,  plus  the
Applicable   Margin  in  effect  on  and  after  the  Restatement
Effective Date.

          (v)  Borrowings and Repayments/Prepayments.  Within the
limits  of  each Revolving Credit 1 Lender's Revolving  Credit  1
Commitment  in effect from time to time, the Borrower may  borrow
under  this Section 2.01(b), repay or prepay pursuant to  Section
2.05 and reborrow under this Section 2.01(b).

          SECTION 2.02.Making the Advances.   (a)(i)Each Borrowing
(other than a  Borrowing consisting of Additional Term 1 Advances
or Additional  RevolvingCredit 1 Advances) shall be made on notice,
given not later than 11:00 A.M. (New York City time) on the third
Business Day  priorto  the date of the proposed Borrowing in the
case of a Borrowing consisting  of Eurodollar Rate Advances or 11:00 A.M.
(New  York City time) on the date of the proposed Borrowing in the
case of a Borrowing  consisting of Base Rate Advances, by the  Borrower
to the  Agent,  which shall give to each Appropriate  Lender  prompt
notice  thereof by telecopier or telex.  Each such  notice  of  a
Borrowing  (a  "Notice  of Borrowing")  shall  be  by  telephone,
confirmed  immediately  in writing, or  telecopier  or  telex  in
substantially  the  form of Exhibit B hereto, specifying  therein
the  requested  (A)  date of such Borrowing, (B)  Facility  under
which  such  Borrowing  is  to  be made,  (C)  Type  of  Advances
comprising such Borrowing, (D) aggregate amount of such Borrowing
and  (E) in the case of a Borrowing consisting of Eurodollar Rate
Advances,  initial Interest Period for each such  Advance.   Each
Appropriate Lender shall, before 1:00 P.M. (New York  City  time)
on  the date of such Borrowing, make available for the account of
its  Applicable  Lending  Office to  the  Agent  at  the  Agent's
Account, in same day funds, such Lender's ratable portion of such
Borrowing in accordance with the respective Commitments under the
applicable  Facility  of such Lender and  the  other  Appropriate
Lenders.   After  the  Agent's receipt of  such  funds  and  upon
fulfillment  of  the applicable conditions set forth  in  Article
III, the Agent will make such funds available to the Borrower  by
crediting the Borrower's Account.

          (ii)  Except as otherwise provided in Section  2.02(b),
each  Borrowing  consisting  of Additional  Term  1  Advances  or
Additional  Revolving  Credit 1 Advances shall  be  made  on  the
Restatement Effective Date; provided that notice shall have  been
given to the Agent not later than 12:00 Noon (New York City time)
on  the  Business Day prior to the Restatement Effective Date  of

                               28

such  proposed  Borrowing by the Borrower (and which  notice  the
Administrative Agent shall have given to each Additional  Term  1
Lender  and  Additional Revolving Credit 1 Lender  prompt  notice
thereof by telex or telecopier).  Each such notice of a Borrowing
consisting of Additional Term 1 Advances or Additional  Revolving
Credit  1  Advances to be made on the Restatement Effective  Date
shall  have been by telephone, confirmed immediately in  writing,
or  telex  or telecopier, in substantially the form of Exhibit  B
hereto,  specifying  therein  the  requested  (A)  date  of  such
Borrowing, (B) Facility under which such Borrowing is to be made,
(C) Type of Advances comprising such Borrowing, and (D) aggregate
amount  of  such Borrowing.  Each Additional Term  1  Lender  and
Additional  Revolving Credit 1  Lender shall, before  11:00  A.M.
(New  York  City  time) on the Restatement Effective  Date,  make
available for the account of its Applicable Lending Office to the
Administrative  Agent at the Administrative Agent's  Account,  in
same  day  funds, such Lender's ratable portion of such Borrowing
in   accordance  with  the  respective  Commitments   under   the
applicable Facility of such Lender and the other Additional  Term
1   Lenders   and   Additional  Revolving   Credit   1   Lenders,
respectively.  After the Administrative Agent's receipt  of  such
funds,  the Administrative Agent shall apply such funds to prepay
ratably  the  aggregate principal amount of any outstanding  Term
Advances  and Revolving Credit Advances of the Term  Lenders  and
the  Revolving Credit Lenders, respectively, that are not Term  1
Lenders  or Revolving Credit 1 Lenders, respectively,  and  shall
deposit  any  remaining  funds,  after  giving  effect  to   such
prepayments, in the Borrower's Account.

          (b)   Anything in subsection (a) above to the  contrary
notwithstanding, (i) the Borrower may not select Eurodollar  Rate
Advances  for  any  Borrowing if the  aggregate  amount  of  such
Borrowing  is less than $10,000,000 or if the obligation  of  the
Appropriate Lenders to make Eurodollar Rate Advances  shall  then
be  suspended pursuant to Section 2.07 or 2.10 and (ii) the  Term
Advances may not be outstanding as part of more than six separate
Borrowings  and  the  Revolving  Credit  Advances  may   not   be
outstanding as part of more than six separate Borrowings.

          (c)  If the Borrower fails to borrow any Borrowing to be
comprised of Eurodollar Rate Advances after the related Notice of
Borrowing has been given to any Appropriate Lender in accordance
with Section 2.02(a), the Borrower shall, within 15 days after
demand by any Appropriate Lender, reimburse such Lender for any
resulting loss or expense incurred by it (or by an existing or
prospective participant in the related Advance), including
(without limitation) any loss incurred in obtaining, liquidating
or employing deposits from third parties, but excluding loss of
margin for the period after such failure to borrow, provided that
such Lender has delivered to the Borrower a certificate setting
forth in reasonable detail calculations as to the amount of such
loss or expense, which certificate shall be conclusive absent
manifest error.

          (d)  Unless the Agent shall have received notice from an
Appropriate Lender prior to the date of any Borrowing under a
Facility under which such Lender has a Commitment that such
Lender will not make available to the Agent such Lender's ratable
portion of such Borrowing, the Agent may assume that such Lender
has made such portion available to the Agent on the date of such
Borrowing in accordance with subsection (a) of this Section 2.02
and the Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount.
If and to the extent that such Lender shall not have so made such

                               29

ratable portion available to the Agent, such Lender and the
Borrower severally agree to repay to the Agent forthwith on
demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the Agent, at
(i) in the case of the Borrower, the higher of (A) the interest
rate applicable at the time to Advances comprising such Borrowing
and (B) the cost of funds incurred by the Agent in respect of
such amount; provided, however, that (x) the Borrower shall have
received from the Agent notice that the Agent has made such
amount available to the Borrower pursuant to its right under this
Section 2.02(d) to assume receipt of such Lender's ratable
portion and (y) any payment by the Borrower of such amount shall
be without prejudice to its rights against such Lender under this
Agreement; and (ii) in the case of such Lender, the Federal Funds
Rate.  If such Lender shall repay to the Agent such corresponding
amount, such amount so repaid shall constitute such Lender's
Advance as part of such Borrowing for purposes of this Agreement.
(e)  The failure of any Lender to make the Advance to be made by
it as part of any Borrowing shall not relieve any other Lender of
its obligation, if any, hereunder to make its Advance on the date
of such Borrowing, but no Lender shall be responsible for the
failure of any other Lender to make the Advance to be made by
such other Lender on the date of any Borrowing.

          SECTION 2.03. Fees. (a) Commitment Fee. The Borrower agrees
to pay to the  Agent  for  the  account of each of the Revolving
Credit  1 Lenders, from the Restatement Effective Date, in the case
of each Revolving  Credit  1 Lender that delivers this  Agreement  on
or prior  to the Restatement Effective Date, and  from the effective
date specified in the Assignment and Acceptance pursuant to which
it  became a Revolving Credit 1 Lender, in the case of each other
Revolving  Credit  1 Lender, until the Termination  Date  of  the
Revolving Credit 1 Facility, payable in arrears on the  last  day
of  each March, June, September and December commencing March 31,
2006  and  on  the  Termination Date of the  Revolving  Credit  1
Facility,  a commitment fee on the average daily unused Revolving
Credit   1 Commitment of such Revolving Credit 1  Lender  at  the
rate  of 1/2 of 1% per annum; provided, however, that no commitment
fee shall accrue on any of the Revolving Credit  1 Commitments of
a  Defaulting Lender so long as such Lender shall be a Defaulting
Lender.

          (b)  Agent's Fees.  The Borrower shall pay to the Agent for its
own  account such fees as may from time to time be agreed between
the Borrower and the Agent.

          SECTION 2.04. Termination or Reduction of the Commitments.
          (a)   Optional. The Borrower shall have the right, upon at least
three Business Days' notice  to  the  Agent,  to terminate in whole
or reduce ratably in part the unused  portions of the Revolving Credit
Commitments of the Lenders, provided that each  partial  reduction  shall
be in  the  aggregate  amount  of $10,000,000  or  an  integral multiple
of  $1,000,000  in  excess thereof.

          (b)  Mandatory.  (i)  Term 1 Facility. On the date of the Term 1
Borrowing,  after  giving effect to such Term  1  Borrowing,  the
aggregate  Term  1  Commitments of the Term 1  Lenders  shall  be
automatically and permanently reduced to zero.


                               30

          (ii) Revolving Credit 1 Facility.  On each date set forth below,
the Revolving Credit 1 Commitments shall be reduced by the amount
set  forth  opposite  such  date (with  each  such  reduction  of
Revolving  Credit  1  Commitments to be made  ratably  among  the
Revolving Credit 1 Lenders' Revolving Credit 1 Commitments):

              Date               Amount of
                                 Reduction
              June 17, 2006      $10,000,000
              September 17,      $10,000,000
              2006
              December 17, 2006  $10,000,000

              March 17, 2007     $10,000,000
              June 17, 2007      $10,000,000
              September 17,      $10,000,000
              2007
              December 17, 2007  $10,000,000

              March 17, 2008     $0.00
              June 17, 2008      $0.00
              September 17,      $0.00
              2008
              December 17, 2008  $0.00

              March 17, 2009     $0.00
              June 17, 2009      $255,000,000


          SECTION 2.05. Repayment of Advances. (a)  Term 1 Advances.
The Borrower shall repay  to the  Agent  for  the ratable account of
the Term  1  Lenders  the aggregate outstanding principal amount of the
Term 1 Advances  on the following dates in the amounts indicated (which
amounts shall be  reduced  as  a  result of the application of  prepayments
in accordance with the order of priority set forth in Section 2.08):

              Date               Amount
              June 17, 2006      $1,120,000
              September 17,      $1,120,000
              2006
              December 17, 2006  $1,120,000

              March 17, 2007     $1,120,000
              June 17, 2007      $1,120,000
              September 17,      $1,120,000
              2007
              December 17, 2007  $1,120,000

              March 17, 2008     $1,120,000
              June 17, 2008      $1,120,000
              September 17,      $1,120,000
              2008
              December 17, 2008  $1,120,000


                               31

              March 17, 2009     $1,120,000
              June 17, 2009      $1,120,000
              September 17,      $1,120,000
              2009
              December 17, 2009  $1,120,000

              March 17, 2010     $0.00
              June 17, 2010      $0.00
              September 17,      $0.00
              2010
              December 17, 2010  $431,200,000

provided, however, that the final principal installment shall  be
repaid  on the Termination Date in respect of the Term 1 Facility
and  in  any  event shall be in an amount equal to the  aggregate
principal amount of the Term 1 Advances outstanding on such date.

          (b)  Revolving Credit 1 Advances.  The Borrower shall repay to
the  Agent  for  the  ratable account of the Revolving  Credit  1
Lenders  on  the  Termination Date in respect  of  the  Revolving
Credit 1 Facility the aggregate principal amount of the Revolving
Credit 1 Advances then outstanding.


          SECTION 2.06. Interest.  (a) Scheduled Interest.
The Borrower shall pay interest on the unpaid principal amount of each
Advance owing  to each  Lender  from the date of such Advance until such
principal amount shall be paid in full, at the following rates per annum:

          (i)  Base Rate Advances.  During such periods as such Advance is
     a Base Rate Advance, a rate per annum equal at all times to the
     sum of (x) the Base Rate in effect from time to time plus (y) the
     Applicable Margin in effect from time to time, payable in arrears
     quarterly on the last day of each March, June, September and
     December during such periods and on the date such Base  Rate
     Advance shall be Converted or paid in full.

          (ii) Eurodollar Rate Advances.  During such periods as such
     Advance is a Eurodollar Rate Advance, a rate per annum equal at
     all times during each Interest Period for such Advance to the sum
     of (x) the Eurodollar Rate for such Interest Period for such
     Advance plus (y) the Applicable Margin in effect from time to
     time, payable in arrears on the last day of such Interest Period
     and, if such Interest Period has a duration of more than three
     months, on each day that occurs during such Interest Period every
     three months from the first day of such Interest Period and on
     the date such Eurodollar Rate Advance shall be Converted or paid
     in full.

          (b)  Default Interest.  Upon the occurrence and during the
continuance  of  an Event of Default under Section  6.01(a),  the
Borrower shall pay interest on (x) the unpaid principal amount of
each  Advance  owing to each Lender, payable in  arrears  on  the
dates  referred  to  in  clause (a)(i) or (a)(ii)  above  and  on
demand,  at a rate per annum equal at all times to 2%  per  annum
above  the  rate  per annum required to be paid on  such  Advance
pursuant to clause (a)(i) or (a)(ii) above and (y) to the fullest
extent permitted by law, the amount of any interest, fee or other
amount  payable under the Financing Documents that  is  not  paid
when  due,  from  the date such amount shall be  due  until  such
amount shall be paid in full, payable in arrears on the date such
amount  shall be paid in full and on demand, at a rate per  annum
equal  at  all  times to 2% per annum above the  rate  per  annum
required  to  be paid, in the case of interest, on  the  Type  of

                               32

Advance  on  which such interest has accrued pursuant  to  clause
(a)(i)  or  (a)(ii) above and, in all other cases, on  Base  Rate
Advances pursuant to clause (a)(i) above.

         (c)  Notice of Interest Period and Interest Rate. Promptly after
receipt of a Notice of Borrowing pursuant to Section 2.02(a), a
notice of Conversion pursuant to Section 2.07 or a notice of
selection of an Interest Period pursuant to the terms of the
definition of "Interest Period", the Agent shall give notice to
the Borrower and each Appropriate Lender of the applicable
Interest Period and the applicable interest rate determined by
the Agent for purposes of clause (a)(i) or (a)(ii) above.


          SECTION 2.07. Conversion of Advances. (a)   Optional.
The Borrower may on  any  Business Day,  upon  notice given to the
Agent not later than  11:00  A.M. (New  York City time) on the third
Business Day prior to the date of  the  proposed  Conversion and
subject to  the  provisions  of Section 2.09, Convert all or any
portion of the Advances  of  one Type  comprising the same Borrowing
into Advances  of  the  other Type;  provided, however, that any
Conversion of Eurodollar  Rate Advances  into Base Rate Advances shall
be made only on the  last day  of an Interest Period for such Eurodollar
Rate Advances, any Conversion  of  Base Rate Advances into Eurodollar
Rate  Advances shall  be in an amount not less than the minimum amount
specified in Section 2.02(b), no Conversion of any Advances shall
result in more separate Borrowings than permitted under Section 2.02(b)
and each Conversion of Advances comprising part of the same Borrowing
under  any  Facility shall be made ratably among the  Appropriate
Lenders in accordance with their Commitments under such Facility.
Each  such  notice of a Conversion shall, within the restrictions
specified  above,  specify (i) the date of such Conversion,  (ii)
the Advances to be Converted and (iii) if such Conversion is into
Eurodollar  Rate  Advances, the duration of the initial  Interest
Period for each such Advance.  Each notice of Conversion shall be
irrevocable and binding on the Borrower.

          (b)  Mandatory.  (i)  On the date on which the aggregate unpaid
principal  amount  of  Eurodollar Rate  Advances  comprising  any
Borrowing   shall  be  reduced,  by  payment  or  prepayment   or
otherwise,   to  less  than  $10,000,000,  such  Advances   shall
automatically Convert into Base Rate Advances.

          (ii) If the Borrower shall fail to select the duration of any
Interest  Period for any Eurodollar Rate Advances  in  accordance
with  the  provisions  contained in the definition  of  "Interest
Period"  in Section 1.01, the Agent will forthwith so notify  the
Borrower  and  the  Appropriate  Lenders,  whereupon  each   such
Eurodollar  Rate Advance will automatically, on the last  day  of
the  then existing Interest Period therefor, Convert into a  Base
Rate Advance.

          (iii) Upon the occurrence and during the continuance of any
Event of Default, (x) each Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest
Period therefor, Convert into a Base Rate Advance and (y) the
obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended.


          SECTION 2.08. Prepayments of Advances.   (a)   Optional.
The Borrower may, upon  notice  at least  three Business Days' prior
to the date of such prepayment, in the case of Eurodollar Rate Advances,
and upon notice at least one  Business  Day prior to the date of such
prepayment,  in  the case  of  Base  Rate Advances, to the Agent stating
the  proposed date  and  aggregate principal amount of the prepayment,

                               33

and  if such  notice  is given the Borrower shall, prepay the outstanding
principal  amount  of the Advances comprising part  of  the  same
Borrowing  in  whole  or ratably in part, together  with  accrued
interest  to the date of such prepayment on the principal  amount
prepaid,  provided,  however, that (x)  each  partial  prepayment
shall  be in an aggregate principal amount of $10,000,000  or  an
integral multiple of $1,000,000 in excess thereof and (y) in  the
event  of  any such prepayment of a Eurodollar Rate Advance,  the
Borrower  shall be obligated to reimburse the Lenders in  respect
thereof pursuant to Section 9.04(c).  Each such prepayment of any
Term  1 Advances shall be applied to the installments thereof  in
inverse order of maturity.

          (b)  Mandatory.  The Borrower shall, on each Business Day, prepay
an  aggregate principal amount of the Revolving Credit 1 Advances
comprising part of the same Borrowings in an amount equal to  the
amount  by  which  (A)  the  aggregate principal  amount  of  the
Revolving  Credit  1 Advances then outstanding  exceeds  (B)  the
Revolving Credit 1 Facility on such Business Day.

          SECTION 2.09. Increased Costs, Etc.(a) If on or after the
date hereof, the adoption of any  applicable  law, rule or regulation,
or any  change  in  any applicable  law,  rule  or  regulation,
or  any  change  in  the interpretation  or  administration thereof
by  any  governmental authority,  central bank or comparable agency
charged  with  the interpretation  or administration thereof, or compliance
by  any Lender  (or  its Applicable Lending Office) with any  request  or
directive  (whether or not having the force of law) of  any  such
authority, central bank or comparable agency:

          (i)  shall subject any Lender (or its Applicable Lending Office)
     to any tax, duty or other charge with respect to its Eurodollar
     Rate  Advances,  its related Note or its Commitment  or  its
     obligation to make Eurodollar Rate Advances, or shall change the
     basis of taxation of payments to any Lender (or its Applicable
     Lending Office) of the principal of or interest on its Eurodollar
     Rate Advances or any other amounts due under this Agreement in
     respect of its Eurodollar Rate Advances or its obligation to make
     Eurodollar Rate Advances (except for changes in franchise taxes
     or  taxes  on the overall net income of such Lender  or  its
     Applicable Lending Office unless such taxes arise in whole or in
     part by reason of the activities, presence or other connection of
     the Borrower in or with the jurisdiction imposing such taxes); or

         (ii) shall impose, modify or deem applicable any reserve
    (including, without limitation, any such requirement imposed by
    the Board of Governors of the Federal Reserve System, but
    excluding with respect to any Eurodollar Rate Advance any such
    requirement included in an applicable Eurodollar Reserve
    Percentage), special deposit, insurance assessment or similar
    requirement against assets of, deposits with or for the account
    of, or credit extended by, any Lender (or its Applicable Lending
    Office) or shall impose on any Lender (or its Applicable Lending
    Office) or on the London interbank market any other condition
    affecting its Eurodollar Rate Advances, its related Note or its
    obligation to make Eurodollar Rate Advances;

and the result of any of the foregoing is to increase the cost to
such  Lender  (or  its Applicable Lending Office)  of  making  or
maintaining any Eurodollar Rate Advance, or to reduce the  amount

                               34

of  any  sum  received  or  receivable by  such  Lender  (or  its
Applicable Lending Office) under this Agreement or under its Note
with  respect thereto, by an amount deemed by such Lender  to  be
material, then, within 15 days after demand by such Lender  (with
a  copy to the Agent), the Borrower shall pay to such Lender such
additional  amount or amounts as will compensate such Lender  for
such increased cost or reduction.

          (b)  If any Lender shall have determined that, after the date
hereof,  the  adoption of any applicable law, rule or  regulation
regarding capital adequacy, or any change in any applicable  law,
rule  or regulation regarding capital adequacy, or any change  in
the  interpretation or administration thereof by any governmental
authority,  central bank or comparable agency  charged  with  the
interpretation  or  administration thereof,  or  any  request  or
directive  regarding capital adequacy (whether or not having  the
force  of  law) of any such authority, central bank or comparable
agency,  has  or would have the effect of reducing  the  rate  of
return on capital of such Lender (or any Person controlling  such
Lender)  as  a  direct  consequence of such Lender's  obligations
hereunder to a level below that which such Lender (or any  Person
controlling  such  Lender)  could  have  achieved  but  for  such
adoption, change, request or directive (taking into consideration
its  policies  with  respect to capital adequacy)  by  an  amount
deemed  by such Lender to be material, then, from time  to  time,
within  15 days after demand by such Lender (with a copy  to  the
Agent),  the  Borrower shall pay to such Lender  such  additional
amount  or amounts as will compensate such Lender (or any  Person
controlling  such Lender) for such reduction (without duplication
of any amounts payable pursuant to subsection (a) above).

         (c)  Each Lender will notify the Borrower and the Agent of any
event occurring after the date of this Agreement which will
entitle such Lender to compensation pursuant to this Section 2.09
as promptly as practicable after it obtains knowledge thereof,
specifying the event giving rise to such claim and setting out in
reasonable detail an estimate (without prejudice) of the basis
and computation of such claim.  Upon receipt of such notice and
of such further notice as may be required by this subsection (c),
the Borrower shall compensate such Lender in accordance with this
Section 2.09 from as of the date such costs are incurred
(including, without limitation, where such costs are
retroactively applied); provided that the Borrower shall not be
required to compensate a Lender for costs incurred earlier than
120 days prior to the date of the notice required to be delivered
to the Borrower pursuant to this subsection (c).  As soon as
practicable after the delivery of the initial notice pursuant to
this subsection (c), such Lender will furnish the Borrower with a
certificate setting forth in reasonable detail the basis and
amount of each request by such Lender for compensation under this
Section 2.09, accompanied by such evidence of such Lender's
entitlement to make a claim under this Section 2.09 as the
Borrower may reasonably request.

         (d)  If, with respect to any Eurodollar Rate Advances, the
Required Lenders notify the Agent that the Eurodollar Rate for
any Interest Period for such Advances will not adequately reflect
the cost to such Lenders of making, funding or maintaining their
Eurodollar Rate Advances for such Interest Period, the Agent
shall forthwith so notify the Borrower and the Appropriate
Lenders, whereupon (i) each such Eurodollar Rate Advance under
such Facility will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Base Rate
Advance and (ii) the obligation of the Appropriate Lenders to
make, or to Convert Advances into, Eurodollar Rate Advances shall
be suspended until the Agent shall notify the Borrower that such

                               35

Lenders have determined that the circumstances causing such
suspension no longer exist.

         (e)  The Borrower shall not be liable to any Lender in
respect of any withholding taxes (including, without limitation, Taxes)
under this Section.


          SECTION 2.10. Illegality. Notwithstanding  any  other
provision   of   this Agreement,  if  the  adoption of or  any
change  in  or  in  the interpretation of any law or regulation shall
make  it  unlawful, or  compliance by any Lender with any request or
directive of any central  bank  or  other  governmental authority
shall  make  it unlawful,  for  any  Lender or its Eurodollar Lending
Office  to perform  its  obligations  hereunder  to  make  Eurodollar
Rate Advances  or  to  continue  to fund or maintain  Eurodollar  Rate
Advances  hereunder, then, on notice thereof and demand  therefor
by  such  Lender  to  the Borrower through the  Agent,  (a)  each
Eurodollar  Rate  Advance will automatically, upon  such  demand,
Convert  into  a  Base  Rate Advance or  an  advance  that  bears
interest  at the Base Rate plus the Applicable Margin  in  effect
from time to time, as the case may be, and (b) the obligation  of
the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances  shall  be suspended until the Agent  shall  notify  the
Borrower  that  such Lender has determined that the circumstances
causing  such  suspension  no longer exist.   Before  giving  any
notice  through the Agent pursuant to this Section,  such  Lender
shall  designate a different Eurodollar Lending  Office  if  such
designation will avoid the need for giving such notice  and  will
not, in the judgment of such Lender, be otherwise disadvantageous
to such Lender.

          SECTION 2.11. Payments and Computations. (a) The Borrower
shall make each payment hereunder not  later than 11:00 A.M. (New York
City time) on the  day  when due in Dollars to the Agent at the
applicable Agent's Account  in same  day funds without counterclaim or
set-off.  The Agent  will promptly  thereafter cause to be distributed
like funds  relating to  the payment of principal or interest or
facility fees ratably (other  than  amounts payable pursuant to Section
2.09,  2.12  or 9.04(c))  to  the  Lenders for the account  of  their
respective Applicable  Lending  Offices, and  like  funds  relating  to
the payment of any other amount payable to any Lender to such  Lender
for the account of its Applicable Lending Office, in each case to
be  applied in accordance with the terms of this Agreement.  Upon
its  acceptance of an Assignment and Acceptance and recording  of
the  information  contained therein in the Register  pursuant  to
Section  9.07(c), from and after the effective date specified  in
such Assignment and Acceptance, the Agent shall make all payments
hereunder  in  respect of the interest assigned  thereby  to  the
Lender  assignee  thereunder, and the parties to such  Assignment
and  Acceptance  shall make all appropriate adjustments  in  such
payments  for  periods  prior  to such  effective  date  directly
between themselves.

          (b)  All computations of interest based on the Base Rate shall be
made  by the Agent on the basis of a year of 365 or 366 days,  as
the  case  may  be,  all computations of interest  based  on  the
Eurodollar  Rate or the Federal Funds Rate and of fees  shall  be
made  by  the Agent on the basis of a year of 360 days,  in  each
case  for the actual number of days (including the first day  but
excluding  the last day) occurring in the period for  which  such
interest or facility fees are payable.  Each determination by the
Agent  of  an  interest rate hereunder shall  be  conclusive  and
binding for all purposes, absent manifest error.


                               36

          (c)  Whenever any payment hereunder shall be stated to be
due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time
shall in such case be included in the computation of payment of
interest or fee, as the case may be; provided, however, that, if
such extension would cause payment of interest on or principal of
Eurodollar Rate Advances to be made in the next following
calendar month, such payment shall be made on the next preceding
Business Day.

          (d)  Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the
Lenders hereunder that the Borrower will not make such payment in
full, the Agent may assume that the Borrower has made such
payment in full to the Agent on such date and the Agent may, in
reliance upon such assumption, cause to be distributed to each
Lender on such due date an amount equal to the amount then due
such Lender.  If and to the extent the Borrower shall not have so
made such payment in full to the Agent, each Lender shall repay
to the Agent forthwith on demand such amount distributed to such
Lender together with interest thereon, for each day from the date
such amount is distributed to such Lender until the date such
Lender repays such amount to the Agent, at the Federal Funds
Rate.

         (e)  Whenever any payment received by the Agent under this
Agreement or any of the other Financing Documents is insufficient
to pay in full all amounts due and payable to the Agent and the
Lenders under or in respect of this Agreement and the other
Financing Documents on any date, such payment shall be
distributed by the Agent and applied by the Agent and the Lenders
in the following order of priority:

         (i)  first, to the payment of all of the fees, indemnification
     payments, costs and expenses that are due and payable to the
     Agent (solely in its capacity as Agent) under or in respect of
     this Agreement and the other Financing Documents on such date,
     ratably based upon the respective aggregate amounts of all such
     fees, indemnification payments, costs and expenses owing to the
     Agent on such date;

        (ii) second, to the payment of all of the indemnification
     payments, costs and expenses that are due and payable to the
     Lenders under Section 9.04 hereof, and any similar section of any
     of the other Financing Documents on such date, ratably based upon
     the respective aggregate amounts of all such indemnification
     payments, costs and expenses owing to the Lenders on such date;

        (iii) third, to the payment of all of the amounts that are
     due and payable to the Agent and the Lenders under Sections 2.09
     and 2.12 hereof on such date, ratably based upon the respective
     aggregate amounts thereof owing to the Agent and the Lenders on
     such date;

        (iv) fourth, to the payment of all of the fees that are due and
     payable to the Revolving Credit 1 Lenders under Section 2.03(a)
     on such date, ratably based upon the respective aggregate
     Revolving Credit 1 Commitments of the Revolving Credit 1 Lenders
     under the Revolving Credit 1 Facility on such date;

         (v)  fifth, to the payment of all of the accrued and unpaid
     interest on the Obligations of the Borrower under or in respect
     of the Financing Documents that is due and payable to the Agent
     and the Lenders under Section 2.06(b) on such date, ratably based
     upon the respective aggregate amounts of all such interest owing
     to the Agent and the Lenders on such date;

         (vi) sixth, to the payment of all of the accrued and unpaid
     interest on the Advances that is due and payable to the Agent and
     the Lenders under Section 2.06(a) on such date, ratably based

                               37

     upon the respective aggregate amounts of all such interest owing
     to the Agent and the Lender on such date;

         (vii) seventh, to the payment of the principal amount of all
     of the outstanding Advances that is due and payable to the Agent
     and the Lenders on such date, ratably based upon the respective
     aggregate amounts of all such principal owing to the Agent and
     the Lenders on such date; and

         (viii) eighth, to the payment of all other Obligations of the
     Loan Parties owing under or in respect of the Financing Documents
     that are due and payable to the Agent and the other Secured
     Parties on such date, ratably based upon the respective aggregate
     amounts of all such Obligations owing to the Agent and the other
     Secured Parties on such date.

         (f)  The Borrower hereby authorizes each Lender and each of its
Affiliates, if and to the extent payment owed to such  Lender  is
not  made  when due hereunder or, in the case of a Lender,  under
the Note held by such Lender, to charge from time to time, to the
fullest  extent  permitted by law, against  any  or  all  of  the
Borrower's accounts with such Lender or such Affiliate any amount
so due.

         (g) Notwithstanding anything to the contrary in  this
Section  2.11,  (i) all of the gross proceeds of  the  Additional
Term  1  Advances and the Additional Revolving Credit 1  Advances
made  on  the Restatement Effective Date shall be used solely  to
refinance Term Advances and Revolving Credit Advances of the Term
Lenders  and the Revolving Credit Lenders, respectively, who  are
not  Term 1 Lenders or Revolving Credit 1 Lenders, (ii) no  other
Lenders shall be entitled to share in any such payments and (iii)
the  Agent  is  authorized to make distributions  of  such  gross
proceeds to give effect to clauses (i) and (ii).

          SECTION 2.12. Taxes. (a) Any and all payments by any
Loan Party to  or for the account of any Lender or the Agent hereunder
or under the Notes  or  any  other  Financing  Document  shall be made,
in accordance with Section 2.11 or the applicable provisions of such
other  Financing Document, if any, free and clear of and  without
deduction for any and all Taxes, except to the extent required by
law.   If  any Loan Party shall be required by law to deduct  any
Indemnified Taxes from or in respect of any sum payable hereunder
or  under any Note or any other Financing Document to any  Lender
or  the  Agent, (i) the sum payable by such Loan Party  shall  be
increased  as may be necessary so that after such Loan Party  and
the Agent have made all required deductions (including deductions
applicable  to  additional sums payable under this Section  2.12)
such Lender or such Agent, as the case may be, receives an amount
equal  to  the sum it would have received had no such  deductions
been  made,  (ii) such Loan Party shall make all such  deductions
and  (iii) such Loan Party shall pay the full amount deducted  to
the  relevant taxation authority or other authority in accordance
with applicable law.

                               38


         (b) In addition, a Loan Party shall pay any present or future
stamp,  documentary, excise, mortgage recording or similar taxes,
charges  or levies that arise from any payment made by such  Loan
Party  hereunder  or  under  any Notes  or  any  other  Financing
Documents  or  from the execution, delivery or  registration  of,
performance under, or otherwise with respect to, this  Agreement,
the  Notes or the other Financing Documents (hereinafter referred
to as "Other Taxes").

         (c) The Loan Parties shall indemnify each Lender and the Agent
for and hold them harmless against the full amount of Indemnified
Taxes (including additional sums payable under this Section 2.12)
imposed as a result of the failure of a Loan Party or the Agent
to deduct such Indemnified Taxes from any payments hereunder or
under the Notes or the Other Financing Documents and pay such
amounts to the appropriate taxing authorities, and Other Taxes,
in each case imposed on or paid by such Lender or the Agent (as
the case may be) and any liability (including penalties,
additions to tax, interest and expenses) arising therefrom or
with respect thereto.  This indemnification shall be made within
30 days from the date such Lender or the Agent (as the case may
be) makes written demand therefor.

          (d) Within 30 days after the date of any payment of any
Indemnified Taxes, the appropriate Loan Party shall furnish to
the Agent, at its address referred to in Section 9.02, the
original or a certified copy of a receipt evidencing such
payment, to the extent such a receipt is issued therefor, or
other written proof of payment thereof that is reasonably
satisfactory to the Agent.  In the case of any payment hereunder
or under the Notes or the other Financing Documents by or on
behalf of a Loan Party (other than by the Agent) through an
account or branch outside the United States or by or on behalf of
a Loan Party by a payor (other than by the Agent) that is not a
United States person, if such Loan Party determines that no
additional Taxes are payable in respect thereof, such Loan Party
shall furnish, or shall cause such payor to furnish, to the
Agent, at such address, an opinion of counsel acceptable to the
Agent to such effect.  For purposes of subsections (d) and (e) of
this Section 2.12, the terms "United States" and "United States
person" shall have the meanings specified in Section 7701 of the
Internal Revenue Code.

          (e) Each Lender organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its
execution and delivery of this Agreement in the case of each
Initial Lender, on or prior to the date of the Restatement
Effective Date in the case of each of the Additional Term 1
Lenders and Additional Revolving Credit 1 Lenders that was not a
Term Lender or a Revolving Credit Lender, respectively,
immediately prior to the Restatement Effective Date and on the
date of the Assignment and Acceptance pursuant to which it
becomes a Lender in the case of each other Lender and from time
to time thereafter as reasonably requested in writing by the
Borrower (but only so long thereafter as such Lender remains
lawfully able to do so), provide each of the Agent and the
Borrower with two original Internal Revenue Service Forms W-8BEN
(claiming the benefits of an income tax treaty) or W-8ECI or, in
the case of a Lender that is claiming exemption from Taxes under
Section 881(c) of the Code with respect to payments of "portfolio
interest", a Form W-8BEN (certifying that such Lender is a non-US
beneficial owner of such payments) and a certificate representing
that such Lender is not (i) a "bank" as defined in Section
881(c)(3)(A) of the Internal Revenue Code), (ii) a 10-percent
shareholder (within the meaning of Section 871(h)(3)(B) of the
Internal Revenue Code) of the Borrower or (iii) a controlled
foreign corporation related to the Borrower (within the meaning
of Section 864(d)(4) of the Internal Revenue Code), or any

                               39

successor or other form prescribed by the Internal Revenue
Service, certifying that such Lender is exempt from or entitled
to a reduced rate of United States withholding tax on payments
pursuant to this Agreement or the Notes or any other Financing
provided that if any form or certificate provided by a Lender
becomes invalid because of a change in the circumstances relating
to such Lender, such Lender will provide a new form certifying
that such Lender is exempt from or entitled to a reduced rate of
United States withholding tax on payments pursuant to this
Agreement or the Notes or any other Financing Document.  Each
Lender and the Agent shall also deliver to each of the Borrower
and the Agent, at the Borrower's request and expense, to the
extent such Lender or Agent is legally able to do so, such other
forms, statements or certificates as may be required in order to
establish the legal entitlement of such Lender or Agent to an
exemption from, or a reduction in the amount of, any Indemnified
Taxes.  If any form or document referred to in this subsection
(e) requires the disclosure of information, other than
information necessary to compute the tax payable and information
required on the date hereof by Internal Revenue Service Form
W-8BEN or W-ECI or the related certificate described above, that
the applicable Lender reasonably considers to be confidential,
such lender shall give notice thereof to the Borrower and shall
not be obligated to include in such form or document such
confidential information.  If a Lender becomes subject to Taxes
because of its failure to deliver a form, certificate or other
document required hereunder, the Loan Parties shall take such
steps as such Lender shall reasonably request at such Lender's
expense to assist such lender to recover such Taxes; provided
that the Loan Party shall not have determined, in its sole
discretion, that such steps may be disadvantageous to any Loan
Party.

          (f)  If the Agent or any Lender determines, in its sole
reasonable discretion, that it has received a refund of any Taxes
as to which it has been indemnified by any Loan Party or with
respect to which any Loan Party has paid additional amounts
pursuant to this Section 2.12, it shall pay over such refund to
such Loan Party (but only to the extent of indemnity payments
made, or additional amounts paid, by such Loan Party under this
Section 2.12 with respect to Taxes giving rise to such refund),
net of all reasonable out-of-pocket expenses of the Agent or such
Lender and without interest (other than any interest paid by the
relevant taxing jurisdiction with respect to such refund, which
shall not be subject to the limitations set forth in the
immediately preceding parenthetical); provided that such Loan
Party, upon the request of the Agent or such Lender, agrees to
repay the amount paid over to such Loan Party (plus any interest
imposed by the relevant taxing jurisdiction) to the Agent or such
Lender in the event the Agent or such Lender is required to repay
such refund to such taxing jurisdiction.

          (g) Upon the request and at the expense of any Loan Party, the
Agent and any Lender subject to Taxes in respect of which such
Loan Party is obligated to make payments under this Section 2.12
shall reasonably cooperate with such Loan Party in contesting
such Tax, provided that each of the agent and any such Lender
shall not have determined, in its sole discretion, that such
content may be disadvantageous to it.

          (h) The Agent agrees to withhold Taxes from any amounts
paid by it hereunder or under the Notes or any other Financing
Document and to file such information returns with respect to such
payments and withholdings, in each case as required by law.


          SECTION 2.13. Sharing of Payments, Etc.
If  any  Lender  shall obtain any  payment  (whether voluntary,
involuntary, through the exercise  of  any  right  of set-off,
or  otherwise) on account of the Advances owing  to  it
(other  than  pursuant to Section 2.09, 2.12 or 9.04(c))  (a)  on

                               40

account  of Obligations due and payable to such Lender  hereunder
and  under the Notes at such time in excess of its ratable  share
(according  to  the  proportion  of  (i)  the  amount   of   such
Obligations due and payable to such Lender at such time  to  (ii)
the  aggregate amount of the Obligations due and payable  to  all
Lenders  hereunder and under the Notes at such time) of  payments
on  account  of  the Obligations due and payable to  all  Lenders
hereunder  and under the Notes at such time obtained by  all  the
Lenders at such time or (b) on account of Obligations owing  (but
not due and payable) to all Lenders hereunder and under the Notes
at  such  time in excess of its ratable share (according  to  the
proportion  of (i) the amount of such Obligations owing  to  such
Lender  at  such  time  to  (ii)  the  aggregate  amount  of  the
Obligations  owing  (but  not due and  payable)  to  all  Lenders
hereunder  and  under  the Notes at such  time)  of  payments  on
account of the Obligations owing (but not due and payable) to all
Lenders  hereunder and under the Notes at such time  obtained  by
all  of  the  Lenders at such time, on account such Lender  shall
forthwith purchase from the other Lenders such participations  in
the  Advances owing to them as shall be necessary to  cause  such
purchasing Lender to share the excess payment ratably  with  each
of  them; provided, however, that if all or any portion  of  such
excess  payment  is  thereafter recovered  from  such  purchasing
Lender,  such  purchase from each Lender shall be  rescinded  and
such  Lender  shall repay to the purchasing Lender  the  purchase
price to the extent of such Lender's ratable share (according  to
the  proportion  of  (i)  the amount of  such  Lender's  required
payment to (ii) the total amount so recovered from the purchasing
Lender)  of any interest or other amount paid or payable  by  the
purchasing  Lender in respect of the total amount  so  recovered.
The Borrower agrees that any Lender so purchasing a participation
from  another Lender pursuant to this Section 2.13  may,  to  the
fullest  extent  permitted by law, exercise  all  its  rights  of
payment  (including the right of set-off) with  respect  to  such
participation as fully as if such Lender were the direct creditor
of   the   Borrower   in   the  amount  of  such   participation.
Notwithstanding  anything to the contrary in this  Section  2.13,
(i)  all  of the gross proceeds of the Additional Term 1 Advances
and  the  Additional  Revolving Credit 1  Advances  made  on  the
Restatement  Effective Date shall be used to solely to  refinance
Term  Advances and Revolving Credit Advances of the Term  Lenders
and  the Revolving Credit Lenders, respectively, who are not Term
1  Lenders  or Revolving Credit 1 Lenders, (ii) no other  Lenders
shall  be  entitled to share in any such payments, and (iii)  the
Agent  is authorized to make distributions of such gross proceeds
to give effect to clauses (i) and (ii).

          SECTION 2.14. Evidence of Debt.(a)  Each Lender shall
maintain in accordance  with its   usual  practice  an  account  or
accounts  evidencing  the indebtedness of the Borrower to such Lender
resulting  from  each Advance  owing  to such Lender from time to time,
including  the amounts of principal and interest payable and paid to
such Lender from time to time hereunder in respect of Advances.  The
Borrower agrees  that  upon notice by any Lender to the Borrower (with a
copy  of  such notice to the Agent) to the effect that a Note  is
required  or  appropriate in order for such  Lender  to  evidence
(whether  for  purposes of pledge, enforcement or otherwise)  the
Advances  owing to, or to be made by, such Lender,  the  Borrower
shall  promptly execute and deliver to such Lender a Note payable
to  the  order  of such Lender in a principal amount  up  to  the
Commitment  of  such  Lender.  All  reference  to  Notes  in  the
Financing  Documents  shall mean Notes, if  any,  to  the  extent
issued hereunder.

          (b)  The Register maintained by the Agent pursuant to Section
9.07(c) shall include a control account, and a subsidiary account
for  each  Lender,  in which accounts (taken together)  shall  be
recorded  (i)  the  date  and  amount  of  each  Borrowing   made

                               41

hereunder, the Type of Advances comprising such Borrowing and, if
appropriate,  the  Interest Period applicable thereto,  (ii)  the
terms of each Assignment and Acceptance delivered to and accepted
by  it,  (iii)  the amount of any principal or interest  due  and
payable  or to become due and payable from the Borrower  to  each
Lender  hereunder and (iv) the amount of any sum received by  the
Agent  from  the  Borrower  hereunder  and  each  Lender's  share
thereof.

          (c) Entries made in good faith by the Agent in the Register
pursuant to subsection (b) above, and by each Lender in its
account or accounts pursuant to subsection (a) above, shall be
prima facie evidence of the amount of principal and interest due
and payable or to become due and payable from the Borrower to, in
the case of the Register, each Lender and, in the case of such
account or accounts, such Lender, under this Agreement, absent
manifest error; provided, however, that the failure of the Agent
or such Lender to make an entry, or any finding that an entry is
incorrect, in the Register or such account or accounts shall not
limit or otherwise affect the obligations of the Borrower under
this Agreement.


          SECTION 2.15. Use of Proceeds. The proceeds of the Advances
shall be available (and the  Borrower agrees that it shall use such
proceeds) solely  (i) to  refinance  the  Term Loan Advances and the
Revolving  Credit Advances, (ii) to pay transaction fees and expenses
and (iii) for general corporate purposes of the Borrower and its Subsidiaries.

          SECTION 2.16. Mitigation, Substitution of Lender. If,
with respect to any Lender, a condition arises or  an  event  occurs
which would, or would upon  the  giving  of notice, result in the
payment of any additional costs pursuant to Section 2.09 or any
additional amounts pursuant to Section  2.12, such  Lender,  promptly
upon becoming aware of  the  same,  shall notify the Borrower (with a
copy to the Agent) thereof and  shall take  such  steps  as  may be
reasonable to it  to  mitigate  the effects of such condition or event
including the designation of a different  Applicable Lending Office or
furnishing of the  proper certificates  under  any applicable tax laws,
tax  treaties  and conventions  to  the  extent that such certificates
are  legally available  to  such Lender, provided that such  Lender  shall
be under  no  obligation to take any step that,  in  its  good-faith
opinion would (i) result in its incurring any additional costs in
performing  its  obligations hereunder unless  the  Borrower  has
agreed   to   reimburse  it  therefore  or  (ii)   be   otherwise
disadvantageous to such Lender in a significant  respect  in  the
reasonable judgment of such Lender.  If (i) the obligation of any
Lender  to  make  Eurodollar  Rate Advances  has  been  suspended
pursuant   to   Section  2.09,  (ii)  any  Lender  has   demanded
compensation  under  Section 2.09 or 2.12, or  (iii)  any  Lender
becomes  a Defaulting Lender, the Borrower shall have the  right,
so  long as no Default shall have occurred and be continuing,  to
seek  a  substitute one or more Eligible Assignees (which may  be
one  or more of the Lenders) to purchase the Note and assume  the
Commitment of such Lender, in accordance with Section 9.07(a).

          SECTION 2.17. Defaulting Lenders.(a) In the event that,
at any one time,  (i)  any Lender  shall be a Defaulting Lender,
(ii) such Defaulting Lender shall  owe  a  Defaulted Advance to the
Borrower  and  (iii)  the Borrower shall be required to make any payment
hereunder or under any  other  Financing  Document to or for  the
account  of  such Defaulting  Lender, then the Borrower may, so long
as no  Default shall  occur  or  be continuing at such time and to
the  fullest extent  permitted by applicable law, set off and otherwise
apply the Obligation of the Borrower to make such payment to or for the
account of such Defaulting Lender against the obligation of  such
Defaulting Lender to make such Defaulted Advance.  In  the  event

                               42

that,  on  any date, the Borrower shall so set off and  otherwise
apply  its  obligation  to  make any  such  payment  against  the
obligation  of such Defaulting Lender to make any such  Defaulted
Advance  on  or  prior to such date, the amount so  set  off  and
otherwise  applied  by  the  Borrower shall  constitute  for  all
purposes  of this Agreement and the other Financing Documents  an
Advance by such Defaulting Lender made on the date of such setoff
under  the Facility pursuant to which such Defaulted Advance  was
originally  required to have been made pursuant to Section  2.01.
Such  Advance  shall  be considered, for  all  purposes  of  this
Agreement,  to comprise part of the Borrowing in connection  with
which such Defaulted Advance was originally required to have been
made  pursuant  to  Section  2.01, even  if  the  other  Advances
comprising  such Borrowing shall be Eurodollar Rate  Advances  on
the  date  such  Advance is deemed to be made  pursuant  to  this
subsection (a).  The Borrower shall notify the Agent at any  time
the  Borrower  exercises its right of set-off  pursuant  to  this
subsection (a) and shall set forth in such notice (A) the name of
the  Defaulting Lender and the Defaulted Advance required  to  be
made  by  such Defaulting Lender and (B) the amount set  off  and
otherwise  applied in respect of such Defaulted Advance  pursuant
to  this  subsection (a).  Any portion of such payment  otherwise
required to be made by the Borrower to or for the account of such
Defaulting  Lender  which is paid by the Borrower,  after  giving
effect  to  the  amount  set  off and otherwise  applied  by  the
Borrower pursuant to this subsection (a), shall be applied by the
Agent as specified in subsection (b) or (c) of this Section 2.17.

          (b)  In the event that, at any one time, (i) any Lender shall be
a  Defaulting  Lender, (ii) such Defaulting Lender  shall  owe  a
Defaulted  Amount  to the Agent or any of the other  Lenders  and
(iii) the Borrower shall make any payment hereunder or under  any
other  Financing  Document to the Agent for the account  of  such
Defaulting Lender, then the Agent may, on its behalf or on behalf
of  such  other  Lenders and to the fullest extent  permitted  by
applicable  law, apply at such time the amount  so  paid  by  the
Borrower to or for the account of such Defaulting Lender  to  the
payment  of each such Defaulted Amount to the extent required  to
pay such Defaulted Amount.  In the event that the Agent shall  so
apply any such amount to the payment of any such Defaulted Amount
on  any date, the amount so applied by the Agent shall constitute
for  all  purposes  of  this Agreement and  the  other  Financing
Documents  payment, to such extent, of such Defaulted  Amount  on
such  date.   Any  such amount so applied by the Agent  shall  be
retained  by the Agent or distributed by the Agent to such  other
Lenders,  ratably in accordance with the respective  portions  of
such Defaulted Amounts payable at such time to the Agent and such
other  Lenders  and, if the amount of such payment  made  by  the
Borrower  shall at such time be insufficient to pay all Defaulted
Amounts owing at such time to the Agent and such other Lenders in
the following order of priority:

          (i)  first, to the Agent for any Defaulted Amounts then
     owing to it, in its capacity as such; and

          (ii) second, to any other Lenders for any Defaulted
     Amounts then owing to such other Lenders, ratably in accordance
     with such respective Defaulted Amounts then owing to such other
     Lenders.

Any  portion of such amount paid by the Borrower for the  account of
such Defaulting Lender remaining, after giving effect to  the amount
applied  by  the Agent pursuant to this subsection  (b), shall  be
applied by the Agent as specified in subsection (c) of this Section 2.17.

                               43


          (c)  In the event that, at any one time, (i) any Lender shall be
a  Defaulting Lender, (ii) such Defaulting Lender shall not owe a
Defaulted  Advance or a Defaulted Amount and (iii) the  Borrower,
the  Agent  or  any  other Lender shall be  required  to  pay  or
distribute  any  amount hereunder or under  any  other  Financing
Document  to  or for the account of such Defaulting Lender,  then
the  Borrower or such other Lender shall pay such amount  to  the
Agent to be held by the Agent, to the fullest extent permitted by
applicable  law,  in escrow or the Agent shall,  to  the  fullest
extent  permitted by applicable law, hold in escrow  such  amount
otherwise  held  by it.  Any funds held by the  Agent  in  escrow
under  this subsection (c) shall be deposited by the Agent in  an
account with a bank (the "Escrow Bank") selected by the Agent, in
the  name and under the control of the Agent, but subject to  the
provisions of this subsection (c).  The terms applicable to  such
account,  including the rate of interest payable with respect  to
the  credit balance of such account from time to time,  shall  be
the  Escrow  Bank's standard terms applicable to escrow  accounts
maintained  with it.  Any interest credited to such account  from
time  to  time  shall be held by the Agent in escrow  under,  and
applied  by  the Agent from time to time in accordance  with  the
provisions  of,  this subsection (c).  The Agent  shall,  to  the
fullest  extent permitted by applicable law, apply all  funds  so
held  in escrow from time to time to the extent necessary to make
any Advances required to be made by such Defaulting Lender and to
pay  any  amount payable by such Defaulting Lender hereunder  and
under  the  other Financing Documents to the Agent or  any  other
Lender, as and when such Advances or amounts are required  to  be
made  or paid and, if the amount so held in escrow shall  at  any
time  be  insufficient  to make and pay  all  such  Advances  and
amounts  required  to  be  made or paid  at  such  time,  in  the
following order of priority:

          (i)  first, to the Agent for any amounts then due and payable by
     such Defaulting Lender to it, in its capacity as such;

          (ii) second, to any other Lenders for any amount then due and
     payable by such Defaulting Lender to such other Lenders
     hereunder, ratably in accordance with such respective amounts
     then due and payable to such other Lenders; and

          (iii) third, to the Borrower for any Advance then required to
     be made by such Defaulting Lender pursuant to a Commitment of
     such Defaulting Lender.
     In  the  event that any Lender that is a Defaulting Lender shall,
     at  any time, cease to be a Defaulting Lender, any funds held  by
     the  Agent  in  escrow at such time with respect to  such  Lender
     shall  be distributed by the Agent to such Lender and applied  by
     such  Lender to the Obligations owing to such Lender at such time
     under this Agreement and the other Financing Documents ratably in
     accordance  with  the  respective  amounts  of  such  Obligations
     outstanding at such time.

          (d)  The rights and remedies against a Defaulting Lender under
this  Section  2.17 are in addition to other rights and  remedies
that  the  Borrower may have against such Defaulting Lender  with
respect to the Defaulted Advance and that the Agent or any Lender
may  have  against  such Defaulting Lender with  respect  to  any
Defaulted Amount.

                           ARTICLE III


                               44


                   CONDITIONS OF EFFECTIVENESS

          SECTION 3.01. Conditions Precedent to Effectiveness. This Agreement
shall become effective on and as  of the  first  date (the "Restatement
Effective Date") on which the Agent shall have received (or receipt shall have
been waived  of)the following, each dated such day (unless otherwise specified),
in form and substance satisfactory to the Agent (unless otherwise
specified)  and  (except for the Term 1 Notes and  the  Revolving
Credit  1  Notes) in sufficient copies for each Lender  party  to
this Agreement as of the Restatement Effective Date:

          (a)  Counterparts of this Agreement, duly executed and delivered
     on behalf of each of (i) the Borrower, (ii) the Parent Guarantor,
     (iii) the Administrative Agent, (iv) the Syndication Agent, (v)
     the  Required Lenders, (vi) each Term 1 Lender,  (vii)  each
     Revolving Credit 1 Lender (or as to any of the foregoing parties,
     the Agent shall have received advice satisfactory to the Agent
     that any such foregoing party has executed a counterpart of this
     Agreement).

          (b)  For any Term 1 Lender or Revolving Credit 1 Lender that so
     requests, a Term 1 Note or Revolving Credit 1 Note, as
     applicable, payable to the order of such Lender duly executed by
     the Borrower evidencing such Lender's Term 1 Advance or Revolving
     Credit 1 Advance, as applicable.

          (c)  Any necessary amendments or modifications to the Aircraft
     Security Agreement, duly executed by the Borrower, together with
     evidence of completion of all recordings and filings of or with
     respect to such amendments or modifications.

          (d)  Any necessary amendments or modifications to the SGR
     Security Agreement, duly executed by the Borrower.

          (e)  Any necessary amendments or modifications to the Pledge
     Agreement, duly executed by the Parent Guarantor.

          (f)  Certified copies of the resolutions of the Board of
     Directors of each Loan Party approving this Agreement, and of all
     documents evidencing other necessary corporate action and
     governmental and other third party approvals and consents, if
     any, with respect to the Transaction.

          (g)  A certificate of each Loan Party signed on behalf of such
     Loan Party by its President or a Vice President and its Secretary
     or any Assistant Secretary, dated the date of the Restatement
     Initial Extension of Credit (the statements made in which
     certificate shall be true on and as of the date of the
     Restatement Initial Extension of Credit, except to the extent
     that any such representation or warranty relates to a specified
     date, in which case such representation or warranty shall be or
     was true and correct as of such date), certifying as to (i) the

                               45

     truth of the representations and warranties contained in the
     Financing Documents as though made on and as of the date of the
     Restatement Initial Extension of Credit, except to the extent
     that any such representation or warranty relates to a specified
     date, in which case such representation or warranty shall be or
     was true and correct as of such date, and (ii) the absence of any
     event occurring and continuing, or resulting from the Restatement
     Initial Extension of Credit, that constitutes a Default.

          (h)  A certificate of the Secretary or an Assistant Secretary of
     each Loan Party certifying the names and true signatures of the
     officers of such Loan Party authorized to sign each Financing
     Document to which it is or is to be a party and the other
     documents to be delivered hereunder and thereunder.

          (i)  A Notice of Borrowing relating to the Restatement Initial
     Extension of Credit in accordance with the requirements of
     Section 2.02(a)(ii) of this Agreement (giving effect to such
     requirements as if the Restatement Effective Date had occurred)
     with respect to the borrowing of the Additional Term 1 Advances
     and the Additional Revolving Credit 1 Advances on the Restatement
     Effective Date.

          (j)  A favorable opinion of the General Counsel for the Borrower
     to the effect that this Agreement is a valid, binding and
     enforceable agreement of the Borrower, and a favorable opinion of
     the General Counsel for the Parent Guarantor to the effect that
     this Agreement is a valid, binding and enforceable agreement of
     the Parent Guarantor, and, in each case, restating the opinions
     of  such counsel dated December 17, 2004 delivered pursuant to
     Section 3.01(a)(xv) of the Existing Credit Agreement that have
     been reasonably requested by the Agent to be so restated, with
     references to the "Borrower Financing Documents" and the "AMR
     Financing Documents", respectively, to mean such documents as
     amended or modified by this Agreement.

          (k)  A favorable opinion of Daugherty Fowler Peregrin, Haught &
     Jenson, FAA counsel to the Loan Parties, restating the opinions
     of such counsel dated December 17, 2004 delivered pursuant to
     Section 3.01(a)(xvi) of the Existing Credit Agreement that have
     been reasonably requested by the Agent to be so restated.

          (l)  The Borrower shall have paid all invoiced accrued fees and
     expenses of the Agent and the Lead Arrangers (including the fees
     and expenses of counsel to the Agent and the Lead Arrangers).


          SECTION 3.02. Conditions Precedent to Each Borrowing.  The
obligation of each Appropriate Lender to make an Advance on the occasion
of each Borrowing (including the initial Borrowing)  shall be subject to
the further conditions  precedent that on the date of such Borrowing
the following statements shall be  true  (and  each  of the giving of the
applicable  Notice  of Borrowing  and the acceptance by the Borrower
of the proceeds  of such Borrowing shall constitute a representation and
warranty  by the  Borrower that on the date of such Borrowing such
statements are  true,  except to the extent that any such representation
or warranty  relates  to  a  specified  date,  in  which  case  such
representation or warranty shall be or was true and correct as of
such date):

          (a)  the representations and warranties contained in each
     Financing Document are correct on and as of such date, before and
     after giving effect to such Borrowing and to the application of
     the proceeds therefrom, as though made on and as of such date,

                               46

     other than any such representations or warranties that, by their
     terms, refer to a specific date other than the date of  such
     Borrowing; and

          (b)  no Default has occurred and is continuing, or would result
     from such Borrowing or from the application of the proceeds
     therefrom.


          SECTION 3.03. Determinations Under Section 3.01. For purposes
of determining compliance  with  the conditions specified in Section
3.01, each Lender shall be deemed to  have  consented to, approved or
accepted or to  be  satisfied with  each  document or other matter
required  thereunder  to  be consented to or approved by or acceptable
or satisfactory to  the Lenders  unless  an  officer  of the Agent
responsible  for  the transactions contemplated by the Financing Documents
shall  have received  notice  from such Lender prior to  the  date
that the Borrower,  by  notice to the Lenders, designates as the
proposed Restatement Effective Date, specifying its objection thereto
and, if  the  Restatement Initial Extension of Credit  consists  of  a
Borrowing, such Lender shall not have made available to the Agent
such Lender's ratable portion of such Borrowing.  The Agent shall
promptly  notify the Lenders of the occurrence of the Restatement
Effective Date.


                           ARTICLE IV

                 REPRESENTATIONS AND WARRANTIES

          SECTION 4.01. Representations and Warranties of the Borrower.
The Borrower represents and warrants as follows:

          (a)  Corporate Existence and Power.  The Borrower (i) is a
     corporation duly incorporated, validly existing and in  good
     standing under the laws of the State of Delaware, (ii) is duly
     qualified and in good standing as a foreign corporation in each
     other jurisdiction in which it owns or leases property or in
     which the conduct of its business requires it to so qualify or be
     licensed, except where the failure to so qualify or be licensed
     could  not reasonably be expected to have a Material Adverse
     Effect  and (iii) has all corporate powers and all  material
     governmental licenses, authorizations, consents and approvals
     required to carry on its business as now conducted.

          (b)  Subsidiaries.  Set forth on Schedule 4.01(b) hereto is a
     complete and accurate list of all Material Subsidiaries of the
     Borrower.  All of the outstanding Equity Interests in the
     Borrower's Material Subsidiaries have been validly issued, are
     fully paid and non-assessable.

          (c)  Corporate Authorization; No Contravention. The execution,
     delivery and performance by the Borrower of this Agreement and
     the other Financing Documents to be delivered by it are within
     the Borrower's corporate powers, have been duly authorized by all
     necessary corporate action, and do not contravene, or constitute
     a default under, any provision of applicable law or regulation or
     of the certificate of incorporation or by-laws of the Borrower or
     of any agreement, judgment, injunction, order, decree or other
     instrument binding upon the Borrower or result in the creation or

                               47

     imposition of any Lien on any asset of the Borrower or any of its
     Material Subsidiaries, other than Liens created pursuant to the
     Financing Documents.

          (d)  Governmental, Third-Party Approvals or Consents.  No
     authorization or approval or other action by, and no notice to or
     filing with, any governmental authority or regulatory body or any
     other third party is required for (i) the due execution,
     delivery, recordation, filing or performance by the Borrower of
     any Financing Document to which it is or is to be a party, or for
     the consummation of the Transaction, (ii) the grant by the
     Borrower of the Liens granted by it pursuant to the Collateral
     Documents, (iii) the perfection or maintenance of the Liens under
     the laws of the United States, any State thereof or any political
     subdivision or agency thereof created under the Collateral
     Documents, subject only to Permitted Liens or (iv) as of the
     Effective Date, the exercise by the Agent or any Lender of its
     rights under the Financing Documents or the remedies in respect
     of the Collateral pursuant to the Collateral Documents, except
     for (a) the authorizations, approvals, actions, notices and
     filings listed on Schedule 4.01(d) hereto, all of which have been
     duly observed, taken, given or made and are in full force and
     effect and (b) the authorizations, approvals, actions, notices
     and filings contemplated by the SGR Security Agreement.

          (e)  Binding Effect.  This Agreement constitutes, and the other
     Financing Documents, when executed and delivered by the Borrower,
     will constitute, valid and binding agreements of the Borrower,
     enforceable against the Borrower in accordance with their
     respective terms, except as may be limited by applicable
     bankruptcy, insolvency, reorganization, moratorium or similar
     laws affecting the rights of creditors generally and by general
     principles of equity.

          (f)  Litigation.  Except as disclosed to the Lenders in Schedule
     4.01(f) hereto, there is no action, suit, investigation,
     litigation or proceeding pending against, or to the knowledge of
     the Borrower threatened against or affecting, the Borrower or any
     of its Material Subsidiaries before any court or arbitrator or
     any governmental body, agency or official (i) which could
     reasonably be expected to have a Material Adverse Effect or
     (ii) which purports to affect the legality, validity or
     enforceability of this Agreement or any Financing Documents or
     the consummation of the transactions contemplated hereby.

          (g)  Financial Information.  (i)  The consolidated balance sheet
     of the Borrower and its Subsidiaries as of December 31, 2005 and
     the related consolidated statements of operations and cash flows
     for the fiscal year then ended, reported on by Ernst & Young LLP
     and set forth in the Borrower's report on Form 10-K for the year
     ended December 31, 2005, a copy of which has been delivered to
     each of the Lenders, fairly present, in conformity with generally
     accepted accounting principles, the consolidated financial
     position of the Borrower and its Subsidiaries as of such date and
     their consolidated results of operations and cash flows for such
     fiscal year.

          (ii) Except as disclosed in the Disclosure Documents filed on or
     prior  to  December 3, 2004, since the date of the financial
     statements  delivered  to the Lenders  pursuant  to  Section
     4.01(g)(i), there has been no material adverse change in the
     business, assets, operations, properties or condition (financial

                               48

     or otherwise) of the Borrower and its Material Subsidiaries,
     considered as a whole.

          (iii) Neither any written information, exhibit or report, nor
     the Disclosure Documents (as modified or supplemented by other
     written information so furnished), taken as a whole, furnished by
     or on behalf of any Loan Party to the Agent, the Lead Arrangers
     or any Lender in connection with the negotiation and syndication
     of the Financing Documents or pursuant to the terms of the
     Financing Documents contained any untrue statement of a material
     fact or omitted to state a material fact necessary to make the
     statements made therein not misleading in light of the
     circumstances in which such information, exhibits and reports
     were provided; provided that, with respect to projections, the
     Borrower represents only that such information was prepared in
     good faith based upon assumptions believed to be reasonable at
     the time.

          (h)  Compliance with ERISA.  Each member of the ERISA Group has
     fulfilled its obligations under the minimum funding standards of
     ERISA and the Internal Revenue Code with respect to each Plan and
     is in compliance in all material respects with the presently
     applicable provisions of ERISA and the Internal Revenue Code with
     respect to each Plan.  No member of the ERISA Group has  (i)
     sought a waiver of the minimum funding standard under Section 412
     of the Internal Revenue Code in respect of any Plan, (ii) failed
     to make any contribution or payment to any Plan or Multiemployer
     Plan  or in respect of any Benefit Arrangement, or made  any
     amendment to any Plan or Benefit Arrangement, which has resulted
     or could result in the imposition of a Lien or the posting of a
     bond or other security under ERISA or the Internal Revenue Code
     or (iii) incurred any liability under Title IV of ERISA other
     than a liability to the PBGC for premiums under Section 4007 of
     ERISA.  Nothing in this paragraph (h) precludes a member of the
     ERISA Group from seeking, after the Effective Date, a waiver of
     the minimum funding standards under Section 412 of the Internal
     Revenue  Code in respect of any Plan, provided the requested
     waiver complies in all other respects with the terms of this
     Agreement.

          (i) Environmental Matters. The Borrower has not received notice
     to the effect, nor does any Responsible Officer have any actual
     knowledge, that its operations are not in material compliance
     with any applicable Environmental Laws or the subject of any
     federal or state investigation evaluating whether any remedial
     action is needed to respond to a release of any toxic or
     hazardous waste or substance into the environment, which
     non-compliance or remedial action could reasonably be expected to
     have a Material Adverse Effect.

          (j)  Margin Regulations.  The Borrower is not engaged in the
     business of extending credit for the purpose of purchasing or
     carrying margin stock (within the meaning of Regulation U issued
     by the Board of Governors of the Federal Reserve System), and no
     proceeds of any Advance will be used to purchase or carry any
     margin stock or to extend credit to others for the purpose of
     purchasing or carrying any margin stock.


                               49

          (k)  Investment Company Act; Public Utility Holding Company Act.
     Neither the Borrower nor any of its Material Subsidiaries is an
    "investment company" or "promoter" or "principal underwriter"
     for, an "investment company", as such terms are defined in the
     Investment Company Act of 1940, as amended.  Neither the Borrower
     nor any of its Material Subsidiaries is a "holding company", or a
     "subsidiary company" of a "holding company", as such terms are
     defined in the Public Utility Holding Company Act of 1935, as
     amended.

          (l) Perfection, Etc. All filings and other actions necessary or
     desirable to perfect (to the extent provided in the Collateral
     Documents) and protect the security interest in the AA Collateral
     created under the Collateral Documents have been duly made or
     taken and are in full force and effect under the laws of the
     United States, any State thereof or any political subdivision or
     agency thereof, and the Collateral Documents create in favor of
     the Agent for the benefit of the Secured Parties a valid and,
     together with such filings and other actions, perfected security
     interest in such AA Collateral, securing the payment of the
     Secured Obligations, under the laws of the United States, any
     State thereof or any political subdivision or agency thereof and
     all filings and other actions necessary or desirable to perfect
     and protect such security interest have been duly taken under the
     laws of the United States, any State thereof or any political
     subdivision or agency thereof.  The Borrower is the legal and
     beneficial owner of the Collateral (as such term is defined in
     the Aircraft Security Agreement) free and clear of any Lien,
     except for the liens and security interests created or permitted
     under the Financing Documents.  The Borrower is the holder of the
     Narita Collateral free and clear of any Lien, except for the
     liens and security interests created or permitted under the
     Financing Documents.

          (m)  No Default.  Neither the Borrower nor any Material
     Subsidiary of the Borrower is in default under or with respect to
     any Contractual Obligation that could, either individually or in
     the aggregate, reasonably be expected to have a Material Adverse
     Effect.

          (n) Casualty, Etc.  Neither the business nor the properties of
     the Borrower or any of its Material Subsidiaries are affected by
     any fire, explosion, accident, strike, lockout or other labor
     dispute, drought, storm, hail, earthquake, embargo, act of God or
     of the public enemy or other casualty (whether or not covered by
     insurance) that could reasonably be expected to have a Material
     Adverse Effect.

          (o)  Taxes.  The Borrower and each of its Material Subsidiaries
     and Affiliates has filed, has caused to be filed or has been
     included in all material tax returns (Federal, state, local and
     foreign) required to be filed and has paid all taxes shown
     thereon to be due and all material taxes otherwise due and
     payable, together with applicable interest and penalties.

          (p)  Aircraft Value.  Schedule 1 to the Aircraft Security
     Agreement, as amended or supplemented from time to time, sets
     forth a list of Unencumbered Stage 3 Aircraft with an Aircraft
     Value, as set forth in the most recent Appraisal Report delivered
     with respect thereto (a copy of which has been delivered to each
     of the Lenders), equal to the amount set forth opposite such
     Aircraft.


                               50

          (q)  Regulatory Status.  The Borrower is an "air carrier" within
     the meaning of Section 40102 of Title 49 and holds a certificate
     under Section 41102 of Title 49.  The Borrower holds an air
     carrier operating certificate issued pursuant to Chapter 447 of
     Title 49.  The Borrower and the Parent Guarantor are each a
     "citizen of the United States" as defined in Section 40102(a)(15)
     of Title 49 and as that statutory provision has been interpreted
     by DOT pursuant to its policies (a "United States Citizen").  The
     Borrower possesses all necessary certificates, franchises,
     licenses, permits, rights, designations, authorizations,
     exemptions, concessions, frequencies, and consents to operate the
     Narita Routes.


          SECTION 4.02. Representations and Warranties of the Parent
Guarantor. The  Parent Guarantor represents and warrants as follows:

          (a)  Corporate Existence and Power.  The Parent Guarantor (i) is
     a corporation duly incorporated, validly existing and in good
     standing under the laws of the State of Delaware, (ii) is duly
     qualified and in good standing as a foreign corporation in each
     other jurisdiction in which it owns or leases property or in
     which the conduct of its business requires it to so qualify or be
     licensed, except where the failure to so qualify or be licensed
     could  not reasonably be expected to have a Material Adverse
     Effect  and (iii) has all corporate powers and all  material
     governmental licenses, authorizations, consents and approvals
     required to carry on its business as now conducted.

          (b)  Corporate Authorization; No Contravention.  The execution,
     delivery and performance by the Parent Guarantor of this
     Agreement and the other Financing Documents to be delivered by it
     are within the Parent Guarantor's corporate powers, have been
     duly authorized by all necessary corporate action, and do not
     contravene, or constitute a default under, any provision of
     applicable law or regulation or of the certificate of
     incorporation or by-laws of the Parent Guarantor or of any
     agreement, judgment, injunction, order, decree or other
     instrument binding upon the Parent Guarantor or result in the
     creation or imposition of any Lien on any asset of the Parent
     Guarantor or any of its Material Subsidiaries, other than Liens
     created pursuant to the Financing Documents.

          (c)  Governmental, Third Party Approvals or Consents.  No
     authorization or approval or other action by, and no notice to or
     filing with, any governmental authority or regulatory body or any
     other third party is required for (i) the due execution,
     delivery, recordation, filing or performance by the Parent
     Guarantor of any Financing Document to which it is or is to be a
     party, or for the consummation of the Transaction, (ii) the grant
     by the Parent Guarantor of the Liens granted by it pursuant to
     the Collateral Documents, (iii) the perfection or maintenance of
     the Liens created under the Collateral Documents, subject only to
     Permitted Liens or (iv) as of the Effective Date, the exercise by
     the Agent or any Lender of its rights under the Financing
     Documents or the remedies in respect of the Collateral pursuant
     to the Collateral Documents, except for the authorizations,
     approvals, actions, notices and filings listed on Schedule
     4.01(d) hereto, all of which have been duly observed, taken,
     given or made and are in full force and effect.

                               51


          (d)  Binding Effect.  This Agreement constitutes, and the other
     Financing Documents, when executed and delivered by the Parent
     Guarantor, will constitute, valid and binding agreements of the
     Parent Guarantor, enforceable against the Parent Guarantor in
     accordance with their respective terms, except as may be limited
     by applicable bankruptcy, insolvency, reorganization, moratorium
     or similar laws affecting the rights of creditors generally and
     by general principles of equity.

          (e)  Financial Information.  The consolidated balance sheet of
     the Parent Guarantor and its Subsidiaries as of December 31, 2005
     and the related consolidated statements of operations and cash
     flows for the fiscal year then ended, reported on by Ernst &
     Young LLP and set forth in the Parent Guarantor's report on Form
     10-K for the year ended December 31, 2005, a copy of which has
     been delivered to each of the Lenders, fairly present, in
     conformity with generally accepted accounting principles, the
     consolidated financial position of the Parent Guarantor and its
     Subsidiaries as of such date and their consolidated results of
     operations and cash flows for such fiscal year.

          (f)  Perfection, Etc.  All filings and other actions necessary or
     desirable to perfect (to the extent set forth in the Pledge
     Agreement) and protect the security interest in the AMR
     Collateral created under the Collateral Documents have been duly
     made or taken and are in full force and effect, and the
     Collateral Documents create in favor of the Agent for the benefit
     of the Secured Parties a valid and, together with such filings
     and other actions, perfected security interest in such AMR
     Collateral, securing the payment of the Secured Obligations, and
     all filings and other actions necessary or desirable to perfect
     and protect such security interest have been duly taken.  The
     Parent Guarantor is the legal and beneficial owners of the AMR
     Collateral free and clear of any Lien, except for the liens and
     security interests created or permitted under the Financing
     Documents.


                            ARTICLE V

                  COVENANTS OF THE LOAN PARTIES

          SECTION 5.01. Affirmative Covenants.   So  long  as  any
principal, interest and  premiums related  to  any  Advances and any fees
hereunder  shall  remain unpaid  or  any  Lender shall have any Commitment
hereunder,  the Borrower,   and   as   to   Sections   5.01(a)(iv),
5.01(a)(v), 5.01(a)(vi),  5.01(a)(ix), 5.01(a)(x),  5.01(a)(xvi), 5.01(b)(i)
and 5.01(h) the Parent Guarantor, will:

          (a) Information. Deliver to the Agent for distribution to the
Lenders:

          (i)  as soon as available and in any event within 90 days (or
     such longer period as is permitted for the filing of an
     equivalent periodic report to the extent an extension thereof has
     been obtained under Rule 12b-25 of the General Rules and
     Regulations under the Securities Exchange Act of 1934, or any
     successor rules) after the end of each fiscal year of the
     Borrower, a consolidated balance sheet of the Borrower and its
     Subsidiaries as of the end of such fiscal year and the related
     consolidated statements of operations and cash flows for such
     fiscal year, setting forth in each case in comparative form the
     figures for the previous fiscal year, all in the form filed with

                               52

     the Securities and Exchange Commission accompanied by an opinion
     of Ernst & Young LLP or other independent public accountants of
     nationally recognized standing;

         (ii) as soon as available and in any event within 45 days (or
     such longer period as is permitted for the filing of an
     equivalent periodic report to the extent an extension thereof has
     been obtained under Rule 12b-25 of the General Rules and
     Regulations under the Securities Exchange Act of 1934, or any
     successor rules) after the end of each of the first three
     quarters of each fiscal year of the Borrower, a consolidated
     balance sheet of the Borrower and its Subsidiaries as of the end
     of such quarter and the related consolidated statements of
     operations and cash flows for such quarter and for the portion of
     the Borrower's fiscal year ended at the end of such quarter,
     setting forth in each case in comparative form the figures for
     the corresponding quarter and the corresponding portion of the
     Borrower's previous fiscal year, all in the form filed with the
     Securities and Exchange Commission and certified (subject to
     normal year-end adjustments) as to fairness of presentation,
     generally accepted accounting principles and consistency by the
     chief financial officer or the chief accounting officer or the
     treasurer of the Borrower;

         (iii) within 90 days after the end of each fiscal year of the
     Borrower and within 45 days after the end of each of the first
     three quarters of each fiscal year of the Borrower (or, in each
     case, such longer period as is permitted for the filing of an
     equivalent underlying periodic report to the extent an extension
     thereof has been obtained under Rule 12b-25 of the General Rules
     and Regulations under the Securities Exchange Act of 1934, or any
     successor rules), a certificate of the chief financial officer or
     the chief accounting officer or the treasurer of the Borrower, in
     substantially the form of Exhibit D-1 attached hereto, (A)
     setting forth in reasonable detail the calculations required to
     establish whether the Borrower was in compliance with the
     requirements of Section 5.03(a) on the date of the financial
     statements most recently delivered pursuant to clause (i) or (ii)
     above, as applicable, (B) stating whether any Default exists on
     the date of such certificate and, if any Default then exists,
     setting forth the details thereof and the action which the
     Borrower is taking or proposes to take with respect thereto and
     (C) as to such Collateral matters as provided for on Exhibit D-1
     attached hereto, provided that in the event of any change in GAAP
     used in the preparation of such financial statements, the
     Borrower shall also provide, if necessary for the determination
     of compliance with Section 5.03(a), a statement of reconciliation
     conforming such financial statements to GAAP; provided, however,
     that any such certificate delivered for the Fiscal Year ended
     December 31, 2005 shall demonstrate compliance with the
     requirements of Section 5.03(a) of the Existing Credit Agreement;

         (iv) as soon as available and in any event within 90 days (or
     such longer period as is permitted for the filing of an
     equivalent periodic report to the extent an extension thereof has
     been obtained under Rule 12b-25 of the General Rules and
     Regulations under the Securities Exchange Act of 1934, or any

                               53

     successor rules) after the end of each fiscal year of the Parent
     Guarantor, a consolidated balance sheet of the Parent Guarantor
     and its Subsidiaries as of the end of such fiscal year and the
     related consolidated statements of operations and cash flows for
     such fiscal year, setting forth in each case in comparative form
     the figures for the previous fiscal year, all in the form filed
     with the Securities and Exchange Commission accompanied by an
     opinion of Ernst & Young LLP or other independent public
     accountants of nationally recognized standing;

         (v)  as soon as available and in any event within 45 days (or
     such longer period as is permitted for the filing of an
     equivalent periodic report to the extent an extension thereof has
     been obtained under Rule 12b-25 of the General Rules and
     Regulations under the Securities Exchange Act of 1934, or any
     successor rules) after the end of each of the first three
     quarters of each fiscal year of the Parent Guarantor, a
     consolidated balance sheet of the Parent Guarantor and its
     Subsidiaries as of the end of such quarter and the related
     consolidated statements of operations and cash flows for such
     quarter and for the portion of the Parent Guarantor's fiscal year
     ended at the end of such quarter, setting forth in each case in
     comparative form the figures for the corresponding quarter and
     the corresponding portion of the Parent Guarantor's previous
     fiscal year, all in the form filed with the Securities and
     Exchange Commission and certified (subject to normal year-end
     adjustments) as to fairness of presentation, generally accepted
     accounting principles and consistency by the chief financial
     officer or the chief accounting officer or the treasurer of the
     Parent Guarantor;

         (vi) within 90 days after the end of each fiscal year of the
     Parent Guarantor and within 45 days after the end of each of the
     first three quarters of each fiscal year of the Parent Guarantor
     (or, in each case, such longer period as is permitted for the
     filing of an equivalent underlying periodic report to the extent
     an extension thereof has been obtained under Rule 12b-25 of the
     General Rules and Regulations under the Securities Exchange Act
     of 1934, or any successor rules), a certificate of the chief
     financial officer, the chief accounting officer, the chief
     executive officer or the treasurer of the Parent Guarantor, in
     substantially the form of Exhibit D-2 hereto, (A) setting forth
     in reasonable detail the calculations required to establish
     whether the Parent Guarantor was in compliance with the
     requirements of Section 5.03(b) on the date of the financial
     statements most recently delivered pursuant to clause (iv) or (v)
     above, as applicable, and (B) stating whether any Default exists
     on the date of such certificate and, if any Default then exists,
     setting forth the details thereof and the action which the Parent
     Guarantor is taking or proposes to take with respect thereto,
     provided that in the event of any change in GAAP used in the
     preparation of such financial statements, the Parent Guarantor
     shall also provide, if necessary for the determination of
     compliance with Section 5.03(b), a statement of reconciliation
     conforming such financial statements to GAAP; provided, however,
     that any such certificate delivered for the Fiscal Year ended
     December 31, 2005 shall demonstrate compliance with the
     requirements of Section 5.03(b) of the Existing Credit Agreement;


                               54

         (vii) within five Business Days after any Responsible Officer
     obtains knowledge of any Default that is not reasonably likely to
     be cured within the applicable grace period or of any Event of
     Default, if such event or condition is then continuing, a
     certificate of the chief financial officer or the chief
     accounting officer or the treasurer of the Borrower setting forth
     the details thereof and the action which the Borrower is taking
     or proposes to take with respect thereto;

         (viii) promptly after any Responsible Officer of the Borrower
     obtains knowledge thereof, notice of all material actions, suits,
     investigations, litigation and proceedings before any court or
     governmental department, commission, board, bureau, agency or
     instrumentality, domestic or foreign, affecting the Borrower or
     any of its Material Subsidiaries of the type described in
     Section 4.01(f);

         (ix) promptly upon the mailing thereof to the shareholders of the
     Borrower or the Parent Guarantor generally, copies of all
     financial statements, reports and proxy statements so mailed;

         (x)  promptly after the furnishing thereof, copies of any notice
     of default furnished to any holder of Debt securities or lenders
     under any bank facility of the Parent Guarantor, the Borrower or
     any of the Borrower's Material Subsidiaries in a principal amount
     of over $40,000,000.

         (xi) promptly upon the filing thereof, copies of all registration
     statements (other than the exhibits thereto and any registration
     statements on Form S-8 or its equivalent) and reports on Forms
     10-K, 10-Q and 8-K (or their equivalents) which the Borrower or
     the Parent Guarantor shall have filed with the Securities and
     Exchange Commission;

         (xii) if and when any member of the ERISA Group (i) gives or
     is required to give notice to the PBGC of any "reportable event"
     (as defined in Section 4043 of ERISA) with respect to any Plan
     which might constitute grounds for a termination of such Plan
     under Title IV of ERISA, or knows that the plan administrator of
     any Plan has given or is required to give notice of any such
     reportable event, promptly, but in no event later than 30 days
     after the occurrence of such reportable event, a copy of the
     notice of such reportable event given or required to be given to
     the PBGC; (ii) receives notice of complete or partial withdrawal
     liability under Title IV of ERISA or notice that any
     Multiemployer Plan is in reorganization, is insolvent or has been
     terminated, promptly upon receipt of such notice, a copy of such
     notice; (iii) receives notice from the PBGC under Title IV of
     ERISA of an intent to terminate, impose liability (other than for
     premiums under Section 4007 of ERISA) in respect of, or appoint a
     trustee to administer, any Plan, promptly upon receipt of such
     notice, a copy of such notice; (iv) applies for a waiver of the
     minimum funding standard under Section 412 of the Internal
     Revenue Code, promptly upon the filing of such application, a
     copy of such application; (v) gives notice of intent to terminate
     any Plan under Section 4041(c) of ERISA, promptly on giving such

                               55

     notice, a copy of such notice and other information filed with
     the PBGC; (vi) gives notice of withdrawal from any Plan pursuant
     to Section 4063 of ERISA, promptly upon the giving of such
     notice, a copy of such notice; or (vii) fails to make any payment
     or contribution to any Plan or Multiemployer Plan or in respect
     of any Benefit Arrangement or makes any amendment to any Plan or
     Benefit Arrangement which has resulted or could result in the
     imposition of a Lien or the posting of a bond or other security,
     promptly upon the occurrence of such failure, a certificate of
     the chief financial officer or the chief accounting officer of
     the Borrower setting forth details as to such occurrence and
     action, if any, which the Borrower or applicable member of the
     ERISA Group is required or proposes to take;

         (xiii) promptly after any Responsible Officer of the Borrower
     obtains knowledge thereof, notice of any Environmental Action
     against or of any noncompliance by the Borrower or any of its
     Material Subsidiaries with any Environmental Law or Environmental
     Permit that could reasonably be expected to have a Material
     Adverse Effect;

         (xiv) promptly after any Responsible Officer of the Borrower
     obtains knowledge thereof, notice of any taxes, assessments and
     governmental charges or liens imposed upon the Borrower or any of
     its Material Subsidiaries or any of their properties, or any
     action, suit, investigation or proceeding in respect thereof,
     which, either individually or in the aggregate, could reasonably
     be expected to have a Material Adverse Effect;

         (xv) promptly after any Responsible Officer of the Borrower
     obtains knowledge thereof, any announcement by Moody's or S&P of
     any change in the Senior Secured Debt Rating; and

         (xvi) from time to time such additional historical
     information regarding the financial position or business of the
     Parent Guarantor, the Borrower and the Borrower's Material
     Subsidiaries as the Agent, at the request of any Lender, may
     reasonably request; provided that requests for non-public
     information shall be limited to items of significant importance
     to the requesting Lender's credit monitoring process and that any
     Lender receiving non-public materials furnished pursuant to this
     clause shall be deemed Confidential Information for purposes of
     this Agreement.


         Reports  required to be delivered pursuant  to  clauses
(i),  (ii), (iv), (v) and (xi) above shall be deemed to have
been delivered on the date on which such report is posted on
the SEC's website at www.sec.gov, and such posting shall  be
deemed to satisfy the reporting requirements of clauses (i),
(ii),  (iv), (v) and (xi) above; provided that the  Borrower
or  the  Parent Guarantor, as the case may be, shall deliver
copies  of  the  reports referred to in clauses  (i),  (ii),
(iv),  (v)  and (xi) above to the Agent for distribution  to
any  Lender  in  accordance with Section 9.02(b)  (it  being
understood that to the extent Section 9.02(b) shall  not  be
applicable, paper copies of such reports shall be  delivered
to  the  Agent  for distribution to any Lender who  requests
such  paper  copies until written notice to cease delivering
paper copies is given by the Agent or such Lender); provided

                             56

further  that in every instance the Borrower or  the  Parent
Guarantor, as the case may be, shall provide paper copies of
the  items described in clauses (iii), (vi), (vii),  (viii),
(ix), (x), (xii), (xiii), (xiv), (xv) and (xvi) above to the
Agent.

         (b)  Maintenance of Existence. (i)Preserve, renew and keep in
     full force and effect its corporate existence and (ii) maintain,
     and cause each of its Material Subsidiaries to maintain, permits,
     rights, privileges, licenses, franchises and approvals, except
     where the failure to do so could not, individually or in the
     aggregate, reasonably be expected to have a Material Adverse
     Effect; provided that nothing in this Section 5.01(b)  shall
     prohibit consolidations, mergers or sales of assets which comply
     with Section 5.02(b).

         (c)  Compliance with Laws.  Comply, and cause each of its
     Material Subsidiaries to comply, in all material respects, with
     all applicable laws (including, without limitation, ERISA and
     Environmental Laws), rules, regulations and orders which are of
     material importance to the conduct of the business, or the
     ownership of the property, of the Borrower and its Material
     Subsidiaries, except where the necessity of compliance therewith
     is contested in good faith by appropriate proceedings.

         (d) Insurance.  Maintain, and cause each of its Material
     Subsidiaries to maintain, insurance (including but not limited to
     liability insurance) with responsible and reputable insurers in
     such amounts and covering such risks as is usually carried by
     companies engaged in a similar business and owning similar
     properties and such other insurance as is required by law
     (including, without limitation, war risk and terrorism insurance
     on all its property and the property of its Material Subsidiaries
     in an amount that is no less than the maximum amount available to
     the Borrower and the Parent Guarantor from the DOT under the
     Federal Aviation Insurance Program, as amended by the Air
     Transportation Stabilization Act and Regulations and further
     amended by the Homeland Security Act of 2002, and as further
     amended by the Vision-100 Century of Aviation Reauthorization
     Act, and as extended by Congress in November 2004).

         (e)  Use of Proceeds.  Use the proceeds of the Advances solely
     for the purposes set forth in Section 2.15.

         (f)  Payment of Taxes, Etc.  Pay and discharge, and cause each of
     its Material Subsidiaries to pay and discharge, before the same
     shall become delinquent, (i) all taxes, governmental assessments
     and governmental charges or levies imposed upon it or upon its
     property and (ii) all lawful claims in respect of taxes,
     governmental assessments, governmental charges and levies that,
     if unpaid, might by law become a Lien upon its property;
     provided, however, that neither the Borrower nor any of its
     Material Subsidiaries shall be required to pay or discharge any
     such tax, assessment, charge, levy or claim that is being
     contested in good faith and by proper proceedings and as to which
     appropriate reserves are being maintained, unless and until any
     Lien resulting therefrom attaches to its property and becomes
     enforceable against its other creditors and any such Liens shall
     attach and become enforceable in respect of any such taxes,
     assessments, charges, levies and claims, which either
     individually or in the aggregate exceed $25,000,000.

                             57


         (g)  Inspection of Aircraft.  Permit the Agent or any of the
     Lenders, or any agent or representative thereof, to exercise its
     inspection rights in accordance with Section 5.03 of the Aircraft
     Security Agreement.

         (h)  Keeping of Books.  Keep, and cause each of its Material
     Subsidiaries to keep, proper books of record and account, in
     which full and correct entries shall be made of all financial
     transactions and the assets and business of the Borrower and each
     such Subsidiary in accordance with generally accepted accounting
     principles in effect from time to time.

         (i)  Maintenance of Equipment.  Maintain, and cause each of its
     Material  Subsidiaries to maintain, substantially all of its
     equipment (except surplus or obsolete equipment) in good
     operating order, except where the failure to keep such equipment
     in good operating order would not have a material adverse effect
     on the financial conditions or results of operations of the
     Borrower.

         (j)  Transactions with Affiliates.  Conduct all transactions with
     any of its Affiliates on terms that are fair and reasonable and
     no less favorable to the Borrower than it would obtain in a
     comparable arm's-length transaction with a Person not an
     Affiliate.  The following transactions shall be deemed to comply
     with this Section 5.01(j):  (i) any Existing Capacity Agreement
     (or any amendments, renewals or replacements thereof to the
     extent that any such Existing Capacity Agreement, as so amended,
     renewed or replaced, shall be on terms (A) approved by the
     Borrower's management upon a good faith determination that such
     amendments, renewals or replacements are consistent with industry
     norms at the time made, (B) that are reasonably consistent with
     past practice and that, taken as a whole, are not materially less
     favorable to the Borrower than such Existing Capacity Agreement,
     or (C) that, taken as a whole together with other benefits
     received at the time from the other party thereto, are not
     materially less favorable to the Borrower than such Existing
     Capacity Agreement); (ii) any transaction or arrangement (other
     than Existing Capacity Agreements or any amendments, renewals or
     replacements thereof) between or among any of the Parent
     Guarantor and any of its direct or indirect subsidiaries
     (including, without limitation, payment of dividends, guarantees
     and making of inter-company loans); (iii) the entering into,
     making payments pursuant to and otherwise performing
     indemnification and contribution obligations in favor of any
     Person who is or becomes a director, officer, agent or employee
     of the Parent Guarantor or any of its direct or indirect
     subsidiaries, in respect of liabilities (A) arising out of the
     fact that any indemnitee was or is a director, officer, agent or
     employee of the Parent Guarantor or any of its direct or indirect
     subsidiaries, or is or was serving at the request of any such
     corporation, as a director, officer, employee or agent of another
     corporation, partnership, joint venture, trust or enterprise or
     (B) to the fullest extent permitted by applicable law, arising
     out of any breach or alleged breach by such indemnitee of his or
     her fiduciary duty as a director or officer of the Parent
     Guarantor or any of its direct or indirect subsidiaries; (iv) the
     Borrower and its Subsidiaries may enter into, and may make
     payments under, employment agreements, employee benefits plans,
     stock option plans, indemnification provisions and other similar
     compensatory arrangements with officers, employees and directors
     of the Parent Guarantor and its direct or indirect subsidiaries
     in the ordinary course of business; (v) performance by the

                             58

     Borrower or any of its Subsidiaries under any customary or
     commercially reasonable tax sharing agreements or arrangements;
    (vi) ordinary course transactions approved by the Board of
     Directors of Borrower or by Borrower's management that are
     reasonably consistent with past practice and reasonable
     modifications or extensions thereof; (vii) transactions with or
     involving any special purpose entities, variable interest
     entities and other similar entities formed in connection with any
     bona fide financing transaction on terms necessary or appropriate
     or customary for the relevant type of transaction (such entities,
     "Financing Vehicles") and (viii) any transaction as to which the
     Borrower has obtained an opinion from a financial advisor or
     appraiser that the transaction is fair to the Borrower from a
     financial point of view.

         (k)  Performance of Material Contracts.  Perform and observe all
     the terms and provisions of each Material Contract to be
     performed or observed by it, except, in any case, where the
     failure to do so, either individually or in the aggregate, could
     not reasonably be expected to have a Material Adverse Effect.
     (l)  Pari Passu.  Ensure that all claims of the Lenders or the
     Agent against the Borrower will be at all times at least pari
     passu to the claims of other unsecured creditors of the Borrower
     (except to the extent provided under bankruptcy, insolvency and
     other similar laws of general applications relating to or
     affecting the enforcement of creditors' rights).

         (m) Appraisals.  (i) Cause the Appraiser to conduct an appraisal
     of the then current Aircraft Value of the Aircraft and to deliver
     an Appraisal Report in respect thereof to the Lenders and the
     Borrower (x) by no later than 45 days prior to each 6-month
     anniversary of the Effective Date (it being understood that such
     appraisal shall not have been conducted earlier than 90 days
     prior to such 6-month anniversary) or (y) promptly at the request
     of the Agent, upon the occurrence or continuation of an Event of
     Default (but not more frequently than every 90 days following the
     occurrence and during the continuance of any Event of Default);
     and (ii) cause the Appraiser to conduct an appraisal of the then
     current fair market value of the Narita Collateral and to deliver
     an Appraisal Report in respect thereof to the Lenders, (x) by no
     later than 45 days prior to each 12-month anniversary of the
     Effective Date (it being understood that such appraisal shall not
     have been conducted earlier than 90 days prior to such 12-month
     anniversary) or (y) promptly at the request of the Agent, upon
     the occurrence or continuation of an Event of Default (but not
     more frequently than every 90 days following the occurrence and
     during the continuance of any Event of Default).

         (n)  Security.

               (i)  Collateral Coverage.  Cause, subject to the provisions set
          forth in this Section 5.01(n), the Aggregate Collateral Value, as
          determined pursuant to the Appraisal Report most recently
          delivered to the Lenders pursuant to Section 5.01(m)(i), to be
          equal to or greater than the Required Collateral Amount.

               (ii) Delivery of Additional Aircraft Collateral.  If the
          Aggregate Collateral Value determined in accordance with the
          Appraisal Report most recently delivered to the Lenders and the

                             59

          Borrower pursuant to Section 5.01(m)(i) is less than the Required
          Collateral Amount, the Borrower shall, within 45 days of the
          delivery to it of such Appraisal Report pursuant to Section
          5.01(m)(i), (A) designate by a supplement to Schedule 1 to the
          Aircraft Security Agreement delivered to each Lender additional
          Unencumbered Stage 3 Aircraft with an Aircraft Value (as
          determined by the Appraiser in an Appraisal Report with respect
          thereto delivered prior to the required time of delivery of such
          supplement), and/or deposit cash and/or Permitted Investments
          into the Cash Collateral Account, such that, after giving effect
          to such supplement and/or such deposit, the Aggregate Collateral
          Value is not less than the Required Collateral Amount and (B) if
          additional Unencumbered Stage 3 Aircraft are being pledged, (i)
          execute and deliver to the Agent the Security Agreement
          Supplements with respect to all Aircraft then being pledged and
          assigned and (ii) within 10 days after receiving the executed
          Security Agreement Supplement back from the Agent, take all
          action necessary or desirable to cause the Liens created thereby
          to be perfected and protected against all creditors and
          transferees of the Borrower under applicable law (including
          without limitation the applicable rules and regulations
          promulgated under the Federal Aviation Act) subject to no prior
          Liens (other than Permitted Liens) (such perfected and protected
          interest, the "Security Arrangements") and furnish Security
          Opinions with respect to all of such Aircraft and any other
          collateral.  If the Borrower fails to make any such Security
          Arrangements within the 45-day period set forth above, the
          Borrower shall prepay any Advances and, to the extent such
          Advances are Revolving Credit Advances, reduce any corresponding
          Revolving Credit Commitments in accordance with the terms hereof,
          so that, after giving effect to such prepayment of Advances, the
          Aggregate Collateral Value determined in accordance with the
          Appraisal Report most recently delivered to the Lenders pursuant
          to Section 5.01(m)(i), shall be equal to or greater than the
          Required Collateral Amount.

               (iii) Substitution and Release of Aircraft Collateral. (A)
          The Borrower may, at any time and from time to time, provided no
          Default under Section 6.01(a) or Section 6.01(f) and no Event of
          Default shall have occurred and be continuing, substitute (x) one
          or more Replacement Aircraft or Replacement Engines for one or
          more Aircraft or Engines, respectively, designated by the
          Borrower, (y) one or more Replacement Aircraft or Replacement
          Engines for cash and/or Permitted Investments or (z) cash and/or
          Permitted Investments for one or more Aircraft or Engines
          designated by the Borrower.  In the event that the Borrower
          desires to effect any such substitution, the Borrower shall
          deliver an amendment to Schedule 1 to the Aircraft Security
          Agreement to all of the Lenders designating any Replacement
          Aircraft or Replacement Engine to be added to such Schedule,
          specifying any Aircraft or Engine to be removed from such
          Schedule and specifying the amount of any cash and/or Permitted
          Investments to be added to, or cash and/or Permitted Investments
          to be removed from, the Cash Collateral Account; provided that
          (I) such amendment is accompanied by (A) an Appraisal Report of
          the Appraiser as to the Aircraft Value of the Replacement
          Aircraft or Replacement Engines, as the case may be, to be
          delivered in substitution and (B) an executed Security Agreement

                             60

          Supplement with respect to any such Replacement Aircraft or
          Replacement Engine, and evidence satisfactory to the Agent that
          such Replacement Aircraft or Replacement Engine has been made
          subject to the Security Arrangements together with Security
          Opinions with respect to such Replacement Aircraft or Replacement
          Engine or, if the collateral delivered in substitution is cash
          and/or Permitted Investments, deposit of such cash and/or
          Permitted Investments with the applicable Cash Collateral Value
          in the Cash Collateral Account and (II) the Aircraft Value of the
          Replacement Aircraft or Replacement Engine, as the case may be,
          to be delivered in substitution (as set forth in the Appraisal
          Report delivered at such time), together with the Cash Collateral
          Value of any cash and/or Permitted Investments deposited in the
          Cash Collateral Account, equals or exceeds the Aircraft Value or
          Cash Collateral Value, as the case may be, of the Aircraft,
          Engines or cash and/or Permitted Investments being replaced.

               (B)  At any time when the Aggregate Collateral Value, determined
          in accordance with the Appraisal Report most recently delivered
          to the Lenders pursuant to Section 5.01(m)(i) exceeds the
          Required Collateral Amount, provided that no Default under
          Section 6.01(a) or Section 6.01(f) and no Event of Default shall
          then have occurred and be continuing, the Borrower may deliver
          notice to the Agent (which shall promptly send copies thereof to
          each Lender) removing any Aircraft or Engine from Schedule 1 to
          the Aircraft Security Agreement and requesting the release of
          Aircraft, Engines or cash and/or Permitted Investments from the
          Lien of the Aircraft Security Agreement, provided that the
          Aggregate Collateral Value after giving effect to such removal or
          release shall not be less than the Required Collateral Amount.
          Such notice shall identify the Aircraft, Engines or cash and/or
          Permitted Investments in the Cash Collateral Account to be
          released.

               (iv) Upon compliance with the foregoing provisions the Agent
          shall, if the Security Arrangements have been effected, release
          the item of collateral being replaced or released and any related
          Warranty Rights (as defined in the Aircraft Security Agreement)
          in accordance with the provisions of the Aircraft Security
          Agreement.

                (v)  Event of Loss.  (A) Upon the occurrence of an Event of Loss
          with respect to any Airframe, the Borrower shall forthwith give
          the Agent notice of such Event of Loss and, within 45 days
          thereafter:  (x) designate by a supplement to Schedule 1 to the
          Aircraft Security Agreement delivered to each Lender a
          Replacement Airframe (together with the same number of
          Replacement Engines as the Engines relating to such Airframe at
          the time such Event of Loss occurred unless such Engines did not
          suffer such Event of Loss and are suitable for use on such
          Replacement Airframe), such Replacement Airframe and Replacement
          Engines (if any) to be free and clear of all Liens (other than
          Permitted Liens) and/or (y) deposit cash and/or Permitted
          Investments in the Cash Collateral Account in replacement for any
          Aircraft of which such Airframe was a part, in each case
          accompanied by (A) an Appraisal Report of the Appraiser as to the

                             61

          Aircraft Value of the Replacement Airframe and Replacement
          Engines (if any) delivered in replacement, such value, together
          with the Cash Collateral Value of any cash and/or Permitted
          Investments deposited in the Cash Collateral Account pursuant to
          clause (y) above, to be at least equal to the Aircraft Value of
          the Airframe and Engines, if any, so replaced and (B) an executed
          Security Agreement Supplement with respect to such Replacement
          Airframe and Replacement Engines (if any), and evidence
          satisfactory to the Agent that any such Replacement Airframes
          and/or Replacement Engines have been made subject to the Security
          Arrangements together with Security Opinions with respect to any
          such Replacement Aircraft or Replacement Engines.

               (B)  Upon the occurrence of an Event of Loss with respect to an
          Engine under circumstances in which there has not occurred an
          Event of Loss with respect to any Airframe, the Borrower shall
          forthwith give the Agent notice of such Event of Loss and, within
          45 days thereafter:  (x) designate by a supplement to Schedule 1
          to the Aircraft Security Agreement delivered to each Lender a
          Replacement Engine, such Replacement Engine to be free and clear
          of all Liens (other than Permitted Liens) and to have an Aircraft
          Value (as set forth in an Appraisal Report of the Appraiser
          delivered to the Lenders at such time) at least equal to the
          Aircraft Value of the Engine so replaced and (y) deliver a
          Security Agreement Supplement with respect to such Replacement
          Engine, and otherwise cause such Replacement Engine to become
          subject to the Security Arrangements and Security Opinions to be
          delivered with respect thereto.

               (C)  Upon compliance with the foregoing provisions, the Agent
          shall release the item of collateral being replaced and any
          related Warranty Rights (as defined in the Aircraft Security
          Agreement) in accordance with the provisions of the Aircraft
          Security Agreement.

               (vi) Costs of Compliance.  The Borrower shall bear all costs and
          expenses of compliance with Section 5.01(m) and this Section
          5.01(n).

          (o)  Further Assurances.  Promptly upon request by the Agent, or
     any Lender through the Agent, do, execute, acknowledge, deliver,
     record, re-record, file, re-file, register and re-register any
     and all such further acts, deeds, conveyances, pledge agreements,
     assignments, financing statements and continuations thereof,
     termination  statements, notices of  assignment,  transfers,
     certificates, assurances and other instruments as the Agent, or
     any Lender through the Agent, may reasonably require from time to
     time  in  order  to (A) to the fullest extent  permitted  by
     applicable law , subject any Loan Party's Collateral to the Liens
     now or hereafter intended to be covered by any of the Collateral
     Documents, (B) perfect and maintain the validity, effectiveness
     and priority of any of the Collateral Documents and any of the
     Liens intended to be created thereunder and (C) assure, convey,
     grant, assign, transfer, preserve, protect and confirm  more
     effectively unto the Secured Parties the rights granted or now or
     hereafter intended to be granted (including, without limitation,
     in respect of the exercise of any remedies under the Collateral
     Documents) to the Secured Parties under any Financing Document or

                             62

     under  any other instrument executed in connection with  any
     Financing Document to which any Loan Party is or is to be  a
     party, and cause each of its Material Subsidiaries to do so.

          (p)  FAA and DOT Matters; Citizenship.  (i) Maintain at all times
     its status at the DOT as an "air carrier" within the meaning of
     Section 40102(a)(2) of Title 49, and hold a certificate under
     Section 41102(a)(1) of Title 49; (ii) at all times hereunder be a
     United States Citizen; (iii) maintain at all times its status at
     the FAA as an air carrier and hold an air carrier operating
     certificate and other operating authorizations issued by the FAA
     pursuant to 14 C.F.R. Sections 119 and 121 as currently in effect
     or as may be amended or recodified from time to time; and (iv)
     possess and maintain all necessary certificates, exemptions,
     franchises, licenses, permits, designations, rights, concessions,
     authorizations, frequencies and consents which are material to
     the operation of the Slots, the Narita Routes and the Narita
     Slots flown by it and the conduct of its business and operations
     as currently conducted except in any case described in this
     clause (iv), where the failure to do so, either individually or
     in the aggregate, could not reasonably be expected to have a
     Material Adverse Effect (provided that nothing in this clause
    (iv) shall prohibit transactions that otherwise comply with the
     terms of the Collateral Documents).


          SECTION 5.02. Negative Covenants. So  long  as  any principal,
interest and  premiums related  to  any  Advances and any fees  hereunder
shall  remain unpaid  or  any  Lender shall have any Commitment hereunder,
the Borrower will not, at any time:

          (a)  Liens, Etc.  Create, incur or assume any Lien or suffer to
     exist (for a period of 30 days after obtaining knowledge thereof)
     any Lien on or with respect to any AA Collateral whether now
     owned or hereafter acquired, or suffer to exist (for a period of
     30 days after obtaining knowledge thereof) or file, under the
     Uniform  Commercial  Code of any jurisdiction,  a  financing
     statement that names the Borrower as debtor in respect of any AA
     Collateral, or suffer to exist (for a period of 30 days after
     obtaining knowledge thereof) or sign, any security agreement
     authorizing any secured party thereunder to file such financing
     statement, except:

               (i)  Liens created under the Financing Documents; and

               (ii) Permitted Liens.

          (b)  Consolidation, Merger, Sale of Assets, Etc.  Consolidate
     with or merge with or into any Person, or convey, transfer or
     lease substantially all of its assets as an entirety to  any
     Person, unless the following conditions are satisfied:

               (i)  except in the case of a merger in which the Borrower is the
          surviving corporation, the entity formed by such consolidation or
          into which the Borrower is merged, or the Person that acquires by
          conveyance, transfer or lease substantially all of the assets of
          the Borrower as an entirety, shall be a corporation organized and
          existing under the laws of the United States of America or any
          State thereof or the District of Columbia, shall be a United
          States Citizen, and shall execute and deliver to the Agent, an
          agreement, in form and substance satisfactory to the Agent,
          containing an assumption by such successor corporation of the due

                             63

          and punctual performance and observance of each obligation,
          covenant and condition of the Borrower under the Financing
          Documents;

               (ii) immediately after and after giving effect to such
          transaction, no Default shall have occurred and be continuing,
          and the Net Worth of the corporation formed by such consolidation
          or into which the Borrower is merged, or of the Person that
          acquired by conveyance, transfer or lease substantially all of
          the assets of the Borrower as an entirety, shall not be less than
          75% of the Net Worth of the Borrower prior to such consolidation,
          merger, conveyance, transfer or lease; and

               (iii) except in the case of the merger in which the Borrower
          is the surviving corporation, the Borrower shall have delivered
          to the Agent a certificate signed by the President, a Senior Vice
          President or a Vice President of the Borrower, and an opinion of
          counsel (which may be the Borrower's General Counsel), each
          stating that such consolidation, merger, conveyance, transfer or
          lease and such assumption agreement comply with this Section, and
          that all conditions precedent herein provided for relating to
          such transaction have been complied with; provided, however, that
          any such opinion of counsel need not opine as to the matters set
          forth in clause (ii) of this Section.


Upon any  consolidation  or  merger,  or  any  conveyance,
transfer or lease of substantially all of the assets of  the
Borrower as an entirety in accordance with this Section, the
successor corporation formed by such consolidation  or  into
which  the  Borrower is merged, or to which such conveyance,
transfer  or  lease  is  made,  shall  succeed  to,  and  be
substituted for, and may exercise every right and power  of,
the  Borrower  under the Financing Documents with  the  same
effect  as if such successor corporation had been  named  as
the  Borrower herein.  No such conveyance, transfer or lease
of  substantially all of the assets of the  Borrower  as  an
entirety shall have the effect of releasing the Borrower  or
any successor corporation that shall theretofore have become
such  in  the  manner prescribed in this  Section  from  its
liability hereunder.

          (c)  Sales, Etc., of AA Collateral.  Sell, lease, transfer or
     otherwise dispose of, any AA Collateral, or grant any option or
     other  right to purchase, lease or otherwise acquire any  AA
     Collateral, except:

               (i)  (x) a sale  of any AA Collateral (other than the Narita
          Collateral) and (y) any other transfer or disposition (including
          any transfer of possession, asset swaps, exchanges, interchanges
          or pooling of assets) or lease of the AA Collateral to the extent
          permitted by the Collateral Documents and Section 5.01(n) hereof,
          provided that, in any case, before and after giving effect to any
          such sale, lease, transfer or other disposition (A) no Event of
          Default shall have occurred and be continuing, (B) in the case of
          subclause (x) above, the Aggregate Collateral Value determined in
          accordance with the Appraisal Report most recently delivered
          pursuant to Section 5.01(m)(i) shall be equal to or greater than
          the Required Collateral Amount and (C) the Borrower shall be in
          compliance with the provisions of Section 5.01(n)(ii);

                             64


               (ii) in a transaction authorized by Section 5.02(b); and

               (iii)  as otherwise consented to by the Agent (such consent
          not to be unreasonably withheld).

          (d)  Accounting Changes.  Make or permit, or permit any of its
     Material Subsidiaries to make or permit, any change  in  (i)
     accounting policies or reporting practices, except as required or
     permitted by generally accepted accounting principles, or (ii)
     Fiscal Year.

          (e)  Partnerships, Etc.  Become a general partner in any limited
     partnership, or permit any of its Material Subsidiaries to do so,
     except (i) to the extent the Borrower or any of such Subsidiaries
     shall have become a general partner in any such limited
     partnership prior to the Effective Date or (ii) through a special
     purpose entity.

          (f)  Payment Restrictions Affecting Subsidiaries.  Directly or
     indirectly, enter into or suffer to exist, or permit any of its
     Material Subsidiaries to enter into or suffer to exist, any
     agreement or arrangement limiting the ability of any of its
     Material Subsidiaries (other than any Financing Vehicles) to
     declare or pay dividends or other distributions in respect of its
     Equity Interests or repay or prepay any Debt owed to, make loans
     or advances to, or otherwise transfer assets to or invest in, the
     Borrower or any Material Subsidiary of the Borrower (whether
     through a covenant restricting dividends, loans, asset transfers
     or investments, a financial covenant or otherwise), except (i)
     the Financing Documents, (ii) any agreement in effect at the time
     such Material Subsidiary becomes a Subsidiary of the Borrower, so
     long as such agreement was not entered into solely in
     contemplation of such Person becoming a Subsidiary of the
     Borrower, (iii) applicable law (including regulatory
     requirements), (iv) customary provisions restricting subletting
     or assignment of any lease governing a leasehold interest of the
     Borrower or a Material Subsidiary of the Borrower, (v) customary
     provisions restricting assignment of any licensing agreement
     entered into by the Borrower or a Material Subsidiary of the
     Borrower in the ordinary course of business, (vi) customary
     provisions restricting the transfer of assets (A) subject to
     Liens or (B) pending disposition, (vii) provisions in charters,
     bylaws, stockholders agreements, partnership agreements, joint
     venture agreements, limited liability company agreements and
     other similar agreements and (viii) provisions in financing
     agreements customary for transactions of a similar nature with
     counterparties that are similarly situated with the applicable
     Material Subsidiary and constitute a similar credit.


          SECTION 5.03. Financial Covenants.   (a)  Liquidity.
So long as any principal, interest and premiums related to any
Advances and any fees hereunder shall remain  unpaid or any Lender
shall have any Commitment hereunder, the  Borrower  will  maintain  at
all  times,  for  the  periods indicated  below,  an  amount  of
liquidity  consisting  of  (i) unencumbered  cash, (ii) unencumbered
Short Term Investments  and (iii)  amounts  available for drawing
under  committed  revolving credit  facilities which have a final
maturity  of  at  least  12 months  after the date of determination,
of not less  than  $1.25 billion:

                             65


          (b)  Cash Flow Coverage.  So long as any principal, interest and
premiums  related  to any Advances and any fees  hereunder  shall
remain  unpaid or any Lender shall have any Commitment hereunder,
the  Parent  Guarantor will maintain, for each  period  indicated
below,  a  Cash  Flow  Coverage Ratio  for  any  period  of  four
consecutive fiscal quarters of the Parent Guarantor most recently
ended,  of  not  less than the amount specified  below  for  such
period:

         Period Ending                Cash Flow
                                      Coverage
                                        Ratio
         March 31, 2006               1.00:1.00
         June 30, 2006                1.00:1.00
         September 30, 2006           1.10:1.00
         December 31, 2006            1.20:1.00
         March 31, 2007               1.30:1.00
         June 30, 2007                1.30:1.00
         September 30, 2007           1.35:1.00
         December 31, 2007            1.40:1.00
         March 31, 2008               1.40:1.00
         June 30, 2008                1.40:1.00
         September 30, 2008           1.40:1.00
         December 31, 2008            1.40:1.00
         March 31, 2009               1.40:1.00
         June 30, 2009 (and each      1.50:1.00
         fiscal quarter thereafter)


                           ARTICLE VI

                        EVENTS OF DEFAULT

          SECTION 6.01. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:

          (a)  (i)  the Borrower shall fail to pay any principal of any
     Advance within one Business Day after the same becomes due and
     payable or (ii) the Borrower shall fail to pay any interest on
     any  Advance, or any Loan Party shall fail to make any other
     payment under any Financing Document, in each case under this
     clause (ii) within five Business Days after the same shall become
     due and payable; or

          (b)  any representation or warranty made or deemed made herein by
     any Loan Party or under or in connection with any Financing
     Document, shall prove to have been false or misleading as of the
     time made or deemed made or furnished in any material respect; or

          (c)  the Borrower shall default in the performance of any
     covenant contained in Section 2.15, 5.01(a)(i), 5.01(a)(ii),

                             66

     5.01(a)(iii), 5.01(a)(iv), 5.01(a)(v), 5.01(a)(vi), 5.01(a)(vii),
     5.01(b)(i), 5.01(m), 5.01(n), 5.02(a), 5.02(b), 5.02(c) or 5.03;
     provided that no failure to deliver Appraisal Reports pursuant to
     Section 5.01(m) shall constitute an Event of Default hereunder
     for a period of 5 Business Days after the same shall become due
     if the Appraiser in respect of such Appraisal Reports ceases or
     is unable prior to such time to provide such Appraisal Reports;
     or

         (d)  any Loan Party shall fail to perform or observe any other
     term, covenant or agreement contained in any Financing Document
    (other than as specified elsewhere in this Section 6.01) on its
    part to be performed or observed if such failure shall remain
    unremedied for 30 days after the earlier of the date on which (i)
    any Responsible Officer of a Loan Party becomes aware of such
    failure or (ii) written notice thereof shall have been given to
    the Borrower by the Agent or any Lender; or

         (e)  the Borrower or any of its Subsidiaries or the Parent
    Guarantor shall fail to pay any principal of, premium or interest
    on any Debt of the Borrower, such Subsidiary or the Parent
    Guarantor (as the case may be) that is outstanding in a principal
    amount (or, in the case of any Hedge Agreement, an Agreement
    Value) of at least $40,000,000 either individually or in the
    aggregate for all of the Borrower, such Subsidiaries and the
    Parent Guarantor (but excluding Debt outstanding hereunder), when
    the same becomes due and payable (whether by scheduled maturity,
    required prepayment, acceleration, demand or otherwise), and such
    failure shall continue after the applicable grace period, if any,
    specified in the agreement or instrument relating to such Debt;
    or by virtue of (i) non-compliance by the Borrower, any of its
    Subsidiaries or the Parent Guarantor with any of its obligations
    under documents, agreements or instruments in respect of such
    Debt or (ii) the occurrence of a change of control (or similar
    event) in respect of the Borrower or the Parent Guarantor, any
    other event shall occur or condition shall exist under any
    agreement or instrument relating to any such Debt and shall
    continue after the applicable grace period, if any, specified in
    such agreement or instrument, if the effect of such event or
    condition is to accelerate, or to permit the acceleration of, the
    maturity of such Debt or otherwise to cause, or to permit the
    holder thereof to cause, such Debt to mature; or by virtue of (i)
    non-compliance by the Borrower, any of its Subsidiaries or the
    Parent Guarantor with any of its obligations under documents,
    agreements or instruments in respect of such Debt or (ii) the
    occurrence of a change of control (or similar event) in respect
    of the Borrower or the Parent Guarantor, any such Debt shall be
    declared to be due and payable or required to be prepaid or
    redeemed (other than by a regularly scheduled required prepayment
    or redemption), purchased or defeased, or an offer to prepay,
    redeem, purchase or defease such Debt shall be required to be
    made, in each case prior to the stated maturity thereof; or

         (f)  the Borrower or any of its Material Subsidiaries or the
    Parent Guarantor shall generally not pay its debts as such debts
    become due, or shall admit in writing its inability to pay its
    debts generally, or shall make a general assignment for the
    benefit of creditors; or any proceeding shall be instituted by or
    against the Borrower or any of its Material Subsidiaries or the
    Parent Guarantor seeking to adjudicate it a bankrupt or
    insolvent, or seeking liquidation, winding up, reorganization,
    arrangement, adjustment, protection, relief, or composition of it

                             67

    or its debts under any law relating to bankruptcy, insolvency or
    reorganization or relief of debtors, or seeking the entry of an
    order for relief or the appointment of a receiver, trustee or
    other similar official for it or for any substantial part of its
    property and, in the case of any such proceeding instituted
    against it (but not instituted by it) that is being diligently
    contested by it in good faith, either such proceeding shall
    remain undismissed or unstayed for a period of 30 days or any of
    the actions sought in such proceeding (including, without
    limitation, the entry of an order for relief against, or the
    appointment of a receiver, trustee, custodian or other similar
    official for, it or any substantial part of its property) shall
    occur; or the Borrower or any of its Material Subsidiaries or the
    Parent Guarantor shall take any corporate action to authorize any
    of the actions set forth above in this subsection (f); or

         (g)  a judgment or order for the payment of money in excess of
    $25,000,000 shall be rendered against the Borrower, any of its
    Subsidiaries or the Parent Guarantor and such judgment or order
    shall continue unsatisfied and unstayed for a period of 30 days;
    or

         (h)  any Financing Document after delivery thereof pursuant to
    Section 3.01 or 5.01(n) shall for any reason cease to be valid
    and binding on or enforceable in any material respect against any
    Loan Party party to it, or any such Loan Party shall so state in
    writing; or

         (i)  any Collateral Document or financing statement after
    delivery thereof pursuant to Section 3.01 or 5.01(n) shall for
    any reason (other than (x) pursuant to the terms thereof or (y)
    as a result of any action or failure to act by the Agent in
    respect of such Collateral Document or financing statement) cease
    to create a valid and perfected first priority lien on and
    security interest in the Collateral purported to be covered
    thereby (subject only to Permitted Liens); or

         (j)  a Change of Control shall occur; or

         (k)  any member of the ERISA Group shall fail to pay when due an
    amount or amounts aggregating in excess of $25,000,000 which it
    shall have become liable to pay under Title IV of ERISA; or
    notice of intent to terminate a Material Plan shall be filed
    under Title IV of ERISA by any member of the ERISA Group, any
    plan administrator or any combination of the foregoing; or the
    PBGC shall institute proceedings under Title IV of ERISA to
    terminate, to impose liability (other than for premiums under
    Section 4007 of ERISA) in respect of, or to cause a trustee to be
    appointed to administer, any Material Plan; or a condition shall
    exist under Section 4042(a)(1), (2) or (3) of ERISA (but not
    Section 4042(a)(4) of ERISA) by reason of which the PBGC would be
    entitled to obtain a decree adjudicating that any Material Plan
    must be terminated; or there shall occur a complete or partial
    withdrawal from, or a default, within the meaning of
    Section 4219(c)(5) of ERISA, with respect to, one or more
    Multiemployer Plans which could cause one or more members of the
    ERISA Group to incur a current payment obligation in excess of
    $25,000,000; or

         (l)  the Borrower shall fail to carry and maintain insurance on
    or with respect to the Aircraft in accordance with the provisions
    of Section 5.06 of the Aircraft Security Agreement; provided
    that, in the case of insurance with respect to which

                             68

    cancellation, change or lapse for nonpayment of premium shall not
    be effective as to the Agent or any Lender for 30 days (seven
    days, or such other period as may from time to time be
    customarily obtainable in the industry, in the case of any war
    risk and allied perils coverage) after receipt of notice by the
    Agent or such Lender of such cancellation, change or lapse, no
    such failure to carry and maintain insurance shall constitute an
    Event of Default until the earlier of (i) the date such failure
    shall have continued unremedied for a period of 20 days (five
    days in the case of any war risk and allied perils coverage)
    after receipt by the Agent or such Lender of the notice of
    cancellation, change or lapse referred to in such Section 5.06,
    or (ii) the date on which such insurance is not in effect as to
    the Agent or any Lender; or

         (m)  any Loan Party shall operate any Aircraft at a time when
    public liability insurance required by Section 5.06(a) of the
    Aircraft Security Agreement shall not be in effect; or

         (n)  the Borrower shall fail to perform any term, covenant or
    agreement contained in (x) Article V of the Aircraft Security
    Agreement (other than Sections 5.02(b), 5.03, 5.05(a), 5.05(b),
    5.06(a), 5.06(b), 5.06(c), 5.06(d) and 5.08 thereof), (y) Article
    IX of the Aircraft Security Agreement or (z) the SGR Security
    Agreement (other than Section 12 thereof) if such failure shall
    remain unremedied for 30 days after the earlier of the date on
    which (i) any Responsible Officer of the Borrower becomes aware
    of such failure or (ii) written notice thereof shall have been
    given to the Borrower by the Agent or any Lender; provided that
    if such failure is capable of being remedied, no such failure
    shall constitute an Event of Default hereunder for a period of 90
    days after the earlier of any Responsible Officer becoming aware
    of any such failure or such written notice so long as the
    Borrower is diligently proceeding to remedy such failure;


then,  and in any such event, the Agent (i) shall at the request,
or  may  with the consent, of the Required Lenders, by notice  to
the Borrower, terminate the Commitments, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or  may  with
the  consent, of the Required Lenders, by notice to the Borrower,
declare  the Advances, all interest thereon and all other amounts
payable under this Agreement and the other Financing Documents to
be  forthwith due and payable, whereupon the Advances,  all  such
interest  and all such amounts shall become and be forthwith  due
and  payable,  without presentment, demand,  protest  or  further
notice  of any kind, all of which are hereby expressly waived  by
the  Borrower; provided, however, that, in the event of an actual
or  deemed  entry  of  an order for relief with  respect  to  the
Borrower  under the Federal Bankruptcy Code, (A) the  Commitments
shall automatically be terminated and (B) the Advances, all  such
interest and all such amounts shall automatically become  and  be
due  and  payable, without presentment, demand,  protest  or  any
notice  of any kind, all of which are hereby expressly waived  by
the Borrower.

                             69


                           ARTICLE VII

                         PARENT GUARANTY

         SECTION 7.01. Guaranty.  (a)  The  Parent  Guarantor
hereby  absolutely, unconditionally  and irrevocably guarantees the
punctual  payment when  due,  whether at scheduled maturity or on
any  date  of  a required  prepayment or by acceleration, demand or
otherwise,  of all  Obligations of the Borrower now or hereafter
existing  under or  in  respect  of  the Financing Documents (including,
without limitation,   any   extensions,   modifications,   substitutions,
amendments   or   renewals  of  any  or  all  of  the   foregoing
Obligations), whether direct or indirect, absolute or contingent,
and  whether  for principal, interest, premiums,  if  any,  fees,
indemnities,  contract  causes  of  action,  costs,  expenses  or
otherwise  (such Obligations being the "Guaranteed Obligations"),
and  agrees  to  pay  any  an
d all expenses  (including,  without
limitation, reasonable fees and expenses of counsel) incurred  by
the  Agent  or  any other Secured Party in enforcing  any  rights
under  this  Parent  Guaranty or any  other  Financing  Document.
Without  limiting  the  generality of the foregoing,  the  Parent
Guarantor's liability shall extend to all amounts that constitute
part  of  the  Guaranteed Obligations and would be  owed  by  the
Borrower  to  any  Secured  Party under  or  in  respect  of  the
Financing  Documents but for the fact that they are unenforceable
or   not   allowable  due  to  the  existence  of  a  bankruptcy,
reorganization or similar proceeding involving the Borrower.

         (b)  The Parent Guarantor hereby unconditionally and irrevocably
agrees that in the event any payment shall be required to be made
to  any  Secured Party under this Parent Guaranty  or  any  other
guaranty,  the Parent Guarantor will contribute, to  the  maximum
extent permitted by law, such amounts to each other guarantor  so
as  to  maximize the aggregate amount paid to the Secured Parties
under or in respect of the Financing Documents.

         SECTION 7.02. Guaranty Absolute. The Parent Guarantor
guarantees that the Guaranteed Obligations will be paid strictly
in accordance with the terms of the  Financing  Documents, regardless
of any law,  regulation  or order  now  or hereafter in effect in any
jurisdiction  affecting any of such terms or the rights of any Secured
Party with respect thereto.   The Obligations of the Parent Guarantor
under  or  in respect of this Parent Guaranty are independent of the
Guaranteed Obligations or any other Obligations of the Borrower under
or  in respect  of  the  Financing Documents, and a separate  action
or actions  may  be  brought  and  prosecuted  against  the   Parent
Guarantor  to  enforce  this  Parent  Guaranty,  irrespective  of
whether  any action is brought against the Borrower or any  other
Loan  Party or whether the Borrower is joined in any such  action
or  actions.   The liability of the Parent Guarantor  under  this
Parent  Guaranty shall be irrevocable, absolute and unconditional
irrespective of, and, to the extent permitted by law, the  Parent
Guarantor hereby irrevocably waives any defenses it may now  have
or  hereafter acquire in any way relating to, any or all  of  the
following:

         (a)  any lack of validity or enforceability of any Financing
     Document or any agreement or instrument relating thereto;

         (b)  any change in the time, manner or place of payment of, or in
     any other term of, all or any of the Guaranteed Obligations or
     any other Obligations of the Borrower under or in respect of the
     Financing Documents, or any other amendment or waiver of or any

                             70

     consent to departure from any Financing Document, including,
     without limitation, any increase in the Guaranteed Obligations
     resulting from the extension of additional credit to the Borrower
     or any of its Subsidiaries or otherwise;

         (c)  any taking, exchange, release or non-perfection of any
     Collateral or any other collateral, or any taking, release or
     amendment or waiver of, or consent to departure from, any other
     guaranty, for all or any of the Guaranteed Obligations;

         (d)  any manner of application of Collateral or any other
     collateral, or proceeds thereof, to all or any of the Guaranteed
     Obligations, or any manner of sale or other disposition of any
     Collateral or any other collateral for all or any of the
     Guaranteed Obligations or any other Obligations of the Borrower
     under the Financing Documents or any other assets of the Borrower
     or any of its Subsidiaries;

         (e)  any change, restructuring or termination of the corporate
     structure or existence of the Borrower or any of its
     Subsidiaries;

         (f)  any failure of any Secured Party to disclose to any Loan
     Party any information relating to the business, condition
     (financial or otherwise), operations, performance, properties or
     prospects of any other Loan Party now or hereafter known to such
     Secured Party (the Parent Guarantor waiving any duty on the part
     of the Secured Parties to disclose such information);

         (g)  the failure of any other Person to execute or deliver any
     other guaranty or agreement or the release or reduction of
     liability of any other guarantor or surety with respect to the
     Guaranteed Obligations; or

         (h)  any other circumstance (including, without limitation, any
     statute of limitations) or any existence of or reliance on any
     representation by any Secured Party that might otherwise
     constitute a defense available to, or a discharge of, any Loan
     Party or any other guarantor or surety, except to the extent the
     Guaranteed Obligations and all other amounts payable under this
     Parent Guaranty shall have been paid in full in cash.

This  Parent  Guaranty  shall continue  to  be  effective  or  be
reinstated, as the case may be, if at any time any payment of any
of  the Guaranteed Obligations is rescinded or must otherwise  be
returned  by  any  Secured Party or any  other  Person  upon  the
insolvency, bankruptcy or reorganization of the Borrower  or  any
other Loan Party or otherwise, all as though such payment had not
been made.


         SECTION 7.03. Waivers and Acknowledgments.  (a)  The Parent
Guarantor hereby unconditionally and irrevocably  waives promptness,
diligence, notice of  acceptance, presentment,  demand for performance,
notice  of  nonperformance, default,  acceleration, protest or dishonor
and any other  notice with respect to any of the Guaranteed Obligations
and this Parent Guaranty  and  any  requirement that any Secured  Party
protect, secure,  perfect  or  insure any Lien  or  any  property  subject
thereto or exhaust any right or take any action against any  Loan
Party or any other Person or any Collateral.


                             71

         (b)  The Parent Guarantor hereby unconditionally and irrevocably
waives  any right to revoke this Parent Guaranty and acknowledges
that this Parent Guaranty is continuing in nature and applies  to
all  Guaranteed  Obligations, whether  existing  now  or  in  the
future.

         (c)  The Parent Guarantor hereby unconditionally and irrevocably
waives (i) any defense arising by reason of any claim or defense
based upon an election of remedies by any Secured Party that in
any manner impairs, reduces, releases or otherwise adversely
affects the subrogation, reimbursement, exoneration, contribution
or indemnification rights of the Parent Guarantor or other rights
of the Parent Guarantor to proceed against the Borrower, any
other guarantor or any other Person or any Collateral and (ii)
any defense based on any right of set-off or counterclaim against
or in respect of the Obligations of the Parent Guarantor
hereunder.

         (d)  The Parent Guarantor acknowledges that the Agent may,
without notice to or demand upon the Parent Guarantor and without
affecting the liability of the Parent Guarantor under this Parent
Guaranty, foreclose under any mortgage by nonjudicial sale, and
the Parent Guarantor hereby waives any defense to the recovery by
the Agent and the other Secured Parties against the Parent
Guarantor of any deficiency after such nonjudicial sale and any
defense or benefits that may be afforded by applicable law.

         (e)  The Parent Guarantor hereby unconditionally and irrevocably
waives any duty on the part of any Secured Party to disclose to
the Parent Guarantor any matter, fact or thing relating to the
business, condition (financial or otherwise), operations,
performance, properties or prospects of any other Loan Party or
any of its Subsidiaries now or hereafter known by such Secured
Party.

         (f)  The Parent Guarantor acknowledges that it will receive
substantial direct and indirect benefits from the financing
arrangements contemplated by the Financing Documents and that the
waivers set forth in Section 7.02 and this Section 7.03 are
knowingly made in contemplation of such benefits.


         SECTION 7.04. Subrogation. The  Parent  Guarantor hereby
unconditionally  and irrevocably  agrees not to exercise any rights
that  it  may  now have  or  hereafter  acquire against the Borrower
or  any  other insider   guarantor  that  arise  from  the  existence,
payment, performance  or enforcement of the Parent Guarantor's Obligations
under  or  in  respect  of  this Parent  Guaranty  or  any  other
Financing Document, including, without limitation, any  right  of
subrogation,   reimbursement,   exoneration,   contribution    or
indemnification  and any right to participate  in  any  claim  or
remedy  of  any Secured Party against the Borrower or  any  other
insider  guarantor or any Collateral, whether or not such  claim,
remedy  or  right arises in equity or under contract, statute  or
common  law, including, without limitation, the right to take  or
receive  from  the  Borrower  or  any  other  insider  guarantor,
directly  or indirectly, in cash or other property or by  set-off
or  in  any other manner, payment or security on account of  such
claim,  remedy  or right, unless and until all of the  Guaranteed
Obligations  and  all  other amounts payable  under  this  Parent
Guaranty shall have been paid in full in cash and the Commitments
shall  have expired or been terminated.  If any amount  shall  be
paid  to  the  Parent Guarantor in violation of  the  immediately
preceding  sentence at any time prior to the  later  of  (a)  the
payment  in  full in cash of the Guaranteed Obligations  and  all
other  amounts  payable under this Parent Guaranty  and  (b)  the
Termination Date, such amount shall be received and held in trust
for  the benefit of the Secured Parties, shall be segregated from

                             72

other  property  and  funds  of the Parent  Guarantor  and  shall
forthwith be paid or delivered to the Agent in the same  form  as
so  received (with any necessary endorsement or assignment) to be
credited and applied to the Guaranteed Obligations and all  other
amounts  payable under this Parent Guaranty, whether  matured  or
unmatured,  in  accordance  with  the  terms  of  the   Financing
Documents,  or  to  be  held  as Collateral  for  any  Guaranteed
Obligations  or other amounts payable under this Parent  Guaranty
thereafter  arising.   If  (i) the Parent  Guarantor  shall  make
payment to any Secured Party of all or any part of the Guaranteed
Obligations, (ii) all of the Guaranteed Obligations and all other
amounts  payable under this Parent Guaranty shall have been  paid
in  full  in  cash  and  (iii) the Termination  Date  shall  have
occurred,  the  Secured Parties will, at the  Parent  Guarantor's
request  and expense, execute and deliver to the Parent Guarantor
appropriate    documents,   without    recourse    and    without
representation or warranty, necessary to evidence the transfer by
subrogation  to  the  Parent Guarantor  of  an  interest  in  the
Guaranteed  Obligations resulting from such payment made  by  the
Parent Guarantor pursuant to this Parent Guaranty.

         SECTION 7.05. Continuing Guaranty; Assignments.
This  Parent Guaranty is a continuing guaranty  and
shall (a) remain in full force and effect until the latest of (i)
the payment in full in cash of the Guaranteed Obligations and all
other  amounts payable under this Parent Guaranty  and  (ii)  the
Termination  Date, (b) be binding upon the Parent Guarantor,  its
successors  and assigns and (c) inure to the benefit  of  and  be
enforceable   by  the  Secured  Parties  and  their   successors,
transferees  and  assigns.  Without limiting  the  generality  of
clause  (c)  of the immediately preceding sentence,  any  Secured
Party may assign or otherwise transfer all or any portion of  its
rights  and obligations under this Agreement (including,  without
limitation,  all or any portion of its Commitments, the  Advances
owing to it and the Note or Notes held by it) to any other Person
as  permitted  pursuant to Section 9.07, and  such  other  Person
shall  thereupon become vested with all the benefits  in  respect
thereof  granted  to such Secured Party herein or  otherwise,  in
each  case  as and to the extent provided in Section  9.07.   The
Parent  Guarantor shall not have the right to assign  its  rights
hereunder  or  any  interest  herein without  the  prior  written
consent of the Secured Parties.

                          ARTICLE VIII

                            THE AGENT

         SECTION 8.01. Authorization and Action.(a)  Each Lender
hereby appoints and authorizes the Agent  to take such action as
agent on its behalf and to exercise such  powers  and discretion
under this Agreement and  the  other Financing  Documents as are
delegated to the Agent by  the  termshereof,  together  with  such
powers  and  discretion   as   are reasonably  incidental thereto.
As to any matters not  expressly provided for by the Financing Documents,
the Agent shall  not  be required to exercise any discretion or take
any action, but shall be  required to act or to refrain from acting
(and shall be fully protected  in  so  acting or refraining  from  acting)
upon  the instructions of the Required Lenders, and such instructions shall
be  binding upon all Lenders; provided, however, that  the  Agent
shall  not be required to take any action that exposes the  Agent
to  personal  liability or that is contrary to this Agreement  or
applicable  law.  The Agent agrees to give to each Lender  prompt
notice of each notice given to it by the Borrower pursuant to the
terms of this Agreement.

                             73


         (b)  In furtherance of the foregoing, each Lender hereby appoints
and  authorizes the Agent to act as the agent of such Lender  for
purposes of acquiring, holding and enforcing any and all Liens on
Collateral  granted by any of the Loan Parties to secure  any  of
the Secured Obligations, together with such powers and discretion
as  are  reasonably incidental thereto.  In this connection,  the
Agent  (and  any  Supplemental  Agents  appointed  by  the  Agent
pursuant  to Section 8.01(c) for purposes of holding or enforcing
any Lien on the Collateral (or any portion thereof) granted under
the  Collateral  Documents,  or  for  exercising  any  rights  or
remedies  thereunder  at the direction of the  Agent),  shall  be
entitled to the benefits of this Article VIII (including, without
limitation, Section 8.05 as though such Supplemental Agents  were
an "Agent" under the Financing Documents) as if set forth in full
herein with respect thereto.

         (c)  The Agent may execute any of its duties under this Agreement
or any other Financing Document (including for purposes of
holding or enforcing any Lien on the Collateral (or any portion
thereof) granted under the Collateral Documents or of exercising
any rights and remedies thereunder at the direction of the Agent)
by or through agents, employees or attorneys-in-fact and shall be
entitled to advice of counsel and other consultants or experts
concerning all matters pertaining to such duties.  The Agent may
also from time to time, when the Agent deems it to be necessary
or desirable, appoint one or more trustees, co-trustees,
collateral co-agents, collateral subagents or attorneys-in-fact
(each, a "Supplemental Agent") with respect to all or any part of
the Collateral; provided, however, that no such Supplemental
Agent shall be authorized to take any action with respect to any
Collateral unless and except to the extent expressly authorized
in writing by the Agent.  Should any instrument in writing from
the Borrower or any other Loan Party be required by any
Supplemental Agent so appointed by the Agent to more fully or
certainly vest in and confirm to such Supplemental Agent such
rights, powers, privileges and duties, the Borrower shall, or
shall cause such Loan Party to, execute, acknowledge and deliver
any and all such instruments promptly upon request by the Agent.
If any Supplemental Agent, or successor thereto, shall die,
become incapable of acting, resign or be removed, all rights,
powers, privileges and duties of such Supplemental Agent, to the
extent permitted by law, shall automatically vest in and be
exercised by the Agent until the appointment of a new
Supplemental Agent.  The Agent shall not be responsible for the
negligence or misconduct of any agent, attorney-in-fact or
Supplemental Agent that it selects in accordance with the
foregoing provisions of this Section 8.01(c) in the absence of
the Agen's gross negligence or willful misconduct.


         SECTION 8.02. Agent's Reliance, Etc. Neither the Agent
nor any of its directors, officers, agents  or  employees  shall be
liable for any  action  taken  or omitted to be taken by it or them
under or in connection with the Financing Documents, except for its or
their own gross negligence or  willful misconduct.  Without limitation
of the generality  ofthe foregoing, the Agent: (i) may treat the payee
of any Note as the  holder  thereof until, in the case of the Agent,
the  Agent receives and accepts an Assignment and Acceptance entered
into by the Lender that is the payee of such Note, as an assignor, and
an Eligible  Assignee,  as  assignee; (ii) may  consult  with  legal
counsel  (including  counsel  for any  Loan  Party),  independent
public accountants and other experts selected by it and shall not
be  liable  for any action taken or omitted to be taken  in  good
faith  by  it  in  accordance with the advice  of  such  counsel,
accountants or experts; (iii) makes no warranty or representation
to  any Lender and shall not be responsible to any Lender for any
statements,  warranties or representations  (whether  written  or

                             74

oral) made in or in connection with the Financing Documents; (iv)
shall  not  have any duty to ascertain or to inquire  as  to  the
performance,  observance or satisfaction of  any  of  the  terms,
covenants or conditions of any Financing Document on the part  of
any  Loan Party or the existence at any time of any Default under
the Financing Documents or to inspect the property (including the
books  and  records)  of  any  Loan  Party;  (v)  shall  not   be
responsible  to  any  Lender  for the  due  execution,  legality,
validity,  enforceability, genuineness, sufficiency or value  of,
or  the  perfection or priority of any lien or security  interest
created  or purported to be created under or in connection  with,
any  Financing  Document  or  any other  instrument  or  document
furnished  pursuant  hereto; and (vi) shall  incur  no  liability
under or in respect of any Financing Document by acting upon  any
notice,  consent,  certificate or  other  instrument  or  writing
(which may be by telecopier, telegram or telex) believed by it to
be genuine and signed or sent by the proper party or parties.

         SECTION 8.03. CUSA and Affiliates.   With respect to its
Commitments, the Advances  made by  it  and the Notes issued to it,
CUSA and its Affiliates shall have the same rights and powers under
the Financing Documents  as any  other Lender and may exercise the
same as though it were not an  Agent;  and  the  term  "Lender" or
"Lenders"  shall,  unlessotherwise  expressly indicated, include CUSA
in  its  individual capacity.  CUSA and its respective affiliates may
accept deposits from,  lend money to, act as trustee under indentures
of,  accept investment banking engagements from and generally engage
in  any kind  of  business with, any Loan Party, any of its  Subsidiaries
and any Person that may do business with or own securities of any
Loan  Party  or any such Subsidiary, all as if CUSA were  not  an
Agent  and  without any duty to account therefor to the  Lenders.
The  Agent  shall  not have any duty to disclose any  information
obtained  or received by it or any of its Affiliates relating  to
any  Loan  Party  or any of its Subsidiaries to the  extent  such
information was obtained or recorded in any capacity  other  than
as Agent.

         SECTION 8.04. Lender Credit Decision. Each Lender acknowledges
that it has, independently and without reliance upon the Agent or any
other Lender and based on  the financial statements referred to in
Section 4.01 or  4.02 and  such  other  documents  and information
as  it  has  deemed appropriate, made its own credit analysis and decision
to  enter into this Agreement.  Each Lender also acknowledges that it will,
independently and without reliance upon the Agent  or  any  other
Lender  and based on such documents and information as  it  shall
deem  appropriate at the time, continue to make  its  own  credit
decisions in taking or not taking action under this Agreement.

         SECTION 8.05. Indemnification. (a)  Each Lender severally
agrees to indemnify  the Agent  (to the extent not reimbursed by the
Borrower),  from  and against  such  Lender's  ratable share  (determined
as  provided below)  of any and all liabilities, obligations, losses,
damages, penalties,   actions,  judgments,  suits,  costs,   expenses
or disbursements  of  any  kind or nature  whatsoever  that  may  be
imposed on, incurred by, or asserted against the Agent in any way
relating  to  or  arising out of the Financing Documents  or  any
action  taken  or  omitted  by  the  Agent  under  the  Financing
Documents (collectively, the "Indemnified Costs"); provided  that
no  Lender  shall  be liable for any portion of  the  Indemnified
Costs  resulting  from  the Agent's gross negligence  or  willful
misconduct  as  found in a final, non-appealable  judgment  by  a
court  of  competent  jurisdiction.  Without  limitation  of  the
foregoing,  each  Lender agrees to reimburse the  Agent  promptly
upon  demand  for  its ratable share of any  costs  and  expenses
(including,  without  limitation, fees and expenses  of  counsel)
incurred  by  the  Agent  in  connection  with  the  preparation,
execution,  delivery, administration, modification, amendment  or

                             75

enforcement  (whether through negotiations, legal proceedings  or
otherwise)  of,  or  legal  advice  in  respect  of   rights   or
responsibilities under, this Agreement, to the  extent  that  the
Agent  is  not reimbursed for such expenses by the Borrower.   In
the  case  of any investigation, litigation or proceeding  giving
rise  to any Indemnified Costs, this Section 8.05 applies whether
any  such  investigation, litigation or proceeding is brought  by
the Agent, any Lender or any other Person.

         (b)  For purposes of this Section 8.05, the Lenders' respective
ratable  shares of any amount shall be determined, at  any  time,
according to the sum of (i) the aggregate principal amount of the
Advances  outstanding at such time and owing  to  the  respective
Lenders  and  (ii)  their respective unused  Revolving  Credit  1
Commitments at such time.  The failure of any Lender to reimburse
the  Agent  promptly  upon demand for its ratable  share  of  any
amount  required  to  be paid by the Lenders  to  the  Agent,  as
provided  herein  shall  not relieve  any  other  Lender  of  its
obligation hereunder to reimburse the Agent for its ratable share
of  such  amount,  but  no Lender shall be  responsible  for  the
failure of any other Lender to reimburse the Agent for such other
Lender's ratable share of such amount.  Without prejudice to  the
survival  of  any  other agreement of any Lender  hereunder,  the
agreement  and  obligations  of each  Lender  contained  in  this
Section  8.05  shall  survive the payment in full  of  principal,
interest  and all other amounts payable hereunder and  under  the
other Financing Documents.

         SECTION 8.06. Successor Agent. The  Agent may resign at
any time by giving written notice thereof to the Lenders and the
Borrower and may be removed at  any time with or without cause by
the Required Lenders.  Upon any  such resignation or removal, the
Required Lenders shall have the  right  to  appoint  a  successor Agent,
which  shall  be  a commercial  bank  organized or licensed under
the  laws  of  the United  States of America or of any State thereof
and  having  a combined capital and surplus of at least $1,000,000,000.
If  no successor  Agent  shall have been so appointed  by  the
Required Lenders, and shall have accepted such appointment, within
30 days after the retiring Agent's giving of notice of resignation or
the Required  Lenders'  removal  of  the  retiring  Agent,  then  the
retiring Agent may, on behalf of the Lenders, appoint a successor
Agent,  which  shall be a commercial bank organized  or  licensed
under  the  laws of the United States of America or of any  State
thereof  and  having a combined capital and surplus of  at  least
$1,000,000,000.  Upon the acceptance of any appointment as  Agent
hereunder  by  a  successor  Agent, such  successor  Agent  shall
thereupon  succeed  to  and become vested with  all  the  rights,
powers, discretion, privileges and duties of the retiring  Agent,
and  the  retiring Agent shall be discharged from its duties  and
obligations  under  this Agreement.  After any  retiring  Agent's
resignation or removal hereunder as Agent, the provisions of this
Article  VIII shall inure to its benefit as to any actions  taken
or  omitted  to  be  taken by it while it was  Agent  under  this
Agreement.   If within 45 days after written notice is  given  of
the  retiring  Agent's resignation or removal under this  Section
8.06  no successor Agent shall have been appointed and shall have
accepted such appointment, then on such 45th day (a) the retiring
Agent's  resignation or removal shall become effective,  (b)  the
retiring Agent shall thereupon be discharged from its duties  and
obligations  under the Financing Documents and (c)  the  Required
Lenders shall thereafter perform all duties of the retiring Agent
under  the  Financing Documents until such time, if any,  as  the
Required Lenders appoint a successor Agent as provided above.



                             76


                           ARTICLE IX

                          MISCELLANEOUS

         SECTION 9.01. Amendments, Etc. No  amendment  or  waiver
of any provision  of  this Agreement or the Notes, nor consent to
any departure by any  Loan Party therefrom, shall in any event be
effective unless the  same shall be in writing and signed (or, in the
case of the Collateral Documents, consented to) by the Required Lenders,
and  then  such waiver  or  consent  shall  be effective  only  in  the
specific instance  and for the specific purpose for which given; provided,
however,  that (a) no amendment, waiver or consent shall,  unless
in  writing and signed by all the Lenders (other than any  Lender
that  is,  at  such time, a Defaulting Lender),  do  any  of  the
following at any time:  (i) waive any of the conditions specified
in  Section  3.01,  or, in the case of the Initial  Extension  of
Credit,  Section 3.02, (ii) change the number of Lenders  or  the
percentage  of  (x) the Commitments or (y) the  aggregate  unpaid
principal  amount of the Advances that, in each  case,  shall  be
required  for  the  Lenders or any of them  to  take  any  action
hereunder,  (iii) reduce or limit the obligations of  the  Parent
Guarantor  under  Section  7.01  hereof  or  release  the  Parent
Guarantor  or  otherwise limit the Parent  Guarantor's  liability
with  respect  to  the Obligations owing to  the  Agent  and  the
Lenders,  (iv) release all or substantially all of the Collateral
in  any  transaction or series of related transactions or  permit
the creation, incurrence, assumption or existence of any Lien  on
all or substantially all of the Collateral in any transaction  or
series  of  related transactions to secure any Obligations  other
than Obligations owing to the Secured Parties under the Financing
Documents, or (v) amend Section 2.13 or this Section 9.01, (b) no
amendment, waiver or consent shall, unless in writing and  signed
by  all  Lenders (other than any Lender that is, at such time,  a
Defaulting  Lender),  (i)  amend the  definitions  of  "Aggregate
Collateral  Value",  "Aircraft Value", "Cash  Collateral  Value",
"Aircraft",  "Eligible Aircraft", "Eligible Cash  Collateral"  or
"Required  Collateral Amount" and (ii) amend Section  5.01(m)  or
Section  5.01(n), and (c) no amendment, waiver or consent  shall,
unless  in  writing and signed by the Required Lenders  and  each
Lender (other than any Lender that is, at such time, a Defaulting
Lender) that has a Commitment under, or is owed any amounts under
or  in  respect  of,  the Term Facility or the  Revolving  Credit
Facility  if such Lender is directly affected by such  amendment,
waiver  or consent, (i) increase the Commitments of such  Lender,
(ii)  reduce the principal of, or interest on, the Advances  held
by  such Lender or any fees or other amounts payable hereunder to
such  Lender,  (iii) postpone any date fixed for any  payment  of
principal of, or interest on, the Advances held by such Lender or
any  fees  or other amounts payable hereunder to such  Lender  or
(iv) postpone any date fixed for the reduction of the Commitments
of  any  Lender;  provided further that no amendment,  waiver  or
consent  shall,  unless in writing and signed  by  the  Agent  in
addition  to  the  Lenders required above to  take  such  action,
affect the rights or duties of the Agent under this Agreement  or
the other Financing Documents.

         SECTION 9.02. Notices, Etc.(a) All notices and other
communications provided for hereunder  shall be either (x) in writing
(including  telecopier, telegraphic  or  telex  communication)
and  mailed,  telecopied, telegraphed, telexed or delivered or (y)
as and to the extent set forth  in  Section  9.02(b) and in the proviso
to  this  Section9.02(a),  if to the Borrower, at its address at 4333
Amon  Carter Boulevard, Fort Worth, Texas 76155, Attention:  Vice
President  - Corporate  Development and Treasurer (telecopy:
(817)967-4318); if  to  the Parent Guarantor, at its address at
4333 Amon  Carter Boulevard,  Fort  Worth, Texas 76155, Attention:

                             77

Chief  Financial Officer (telecopy: (817) 967-4318); if to any Initial
Lender,  at its  Domestic  Lending  Office specified  opposite  its
name  on Schedule  I  hereto;  if  to any other Lender,  at  its
Domestic Lending   Office  specified  in  the  Assignment  and
Acceptance pursuant to which it became a Lender; and if to the Agent,
at its address at Two Penns Way, Suite 110, New Castle, Delaware
19720, Attention:  Bank  Loan  Syndications Department,  Elizabeth  Wier
(telecopy:   (212) 994-0961); or, as to the Borrower, the  Parent
Guarantor  or  the  Agent,  at such other  address  as  shall  be
designated by such party in a written notice to the other parties
and,  as  to each other party, at such other address as shall  be
designated by such party in a written notice to the Borrower  and
the  Agent,  provided  that materials required  to  be  delivered
pursuant to Section 5.01(a)(i), (ii), (iv), (v) and (xi) shall be
delivered  to  the Agent as specified in Section  9.02(b)  or  as
otherwise  specified to the Borrower or the Parent  Guarantor  by
the  Agent.   All  such  notices and communications  shall,  when
mailed,  telecopied, telegraphed or e-mailed, be  effective  when
deposited  in  the mails, telecopied, delivered to the  telegraph
company or confirmed by e-mail, respectively, except that notices
and  communications to the Agent pursuant to Article II,  III  or
VIII  shall  not  be  effective  until  received  by  the  Agent.
Delivery  by  telecopier  of  an  executed  counterpart  of   any
amendment  or  waiver of any provision of this Agreement  or  the
Notes  or  of  any  Exhibit hereto to be executed  and  delivered
hereunder  shall be effective as delivery of a manually  executed
counterpart thereof.

         (b)  Each of the Borrower and the Parent Guarantor hereby agrees
that it will provide to the Agent all information, documents and
other materials that it is obligated to furnish to the Agent
pursuant to the Financing Documents, including, without
limitation, all notices, requests, financial statements,
financial and other reports, certificates and other information
materials, but excluding any such communication that (i) relates
to a request for a new, or a Conversion of an existing Borrowing
or other extension of credit (including any election of an
interest rate or interest period relating thereto), (ii) relates
to the payment of any principal or other amount due under the
Financing Documents prior to the scheduled date therefor,
(iii) provides notice of any Default or Event of Default under
the Financing Documents or (iv) is required to be delivered to
satisfy any condition precedent to the effectiveness of the
Financing Documents and/or any Borrowing or other extension of
credit thereunder (all such non-excluded communications being
referred to herein collectively as "Communications"), by
transmitting the Communications in an electronic/soft medium in a
format reasonably acceptable to the Agent to
oploanswebadmin@citigroup.com.  In addition, the Borrower and the
Parent Guarantor agree to continue to provide the Communications
to the Agent in the manner specified in the Financing Documents
but only to the extent reasonably requested by the Agent.

         (c)  The Borrower and the Parent Guarantor further agree that the
Agent may make the Communications available to the Lenders by
posting the Communications on Intralinks or a substantially
similar electronic transmission systems (the "Platform").

         (d)  THE PLATFORM IS PROVIDED "AS IS" AND "AS AVAILABLE".  THE
AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR
COMPLETENESS OF THE COMMUNICATIONS, OR THE ADEQUACY OF THE
PLATFORM AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS OR OMISSIONS
IN THE COMMUNICATIONS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED
OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR

                           78

OTHER CODE DEFECTS, IS MADE BY THE AGENT PARTIES IN CONNECTION
WITH THE COMMUNICATIONS OR THE PLATFORM.  IN NO EVENT SHALL THE
AGENT OR ANY OF ITS AFFILIATES OR ANY OF THEIR RESPECTIVE
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ADVISORS OR
REPRESENTATIVES (COLLECTIVELY, "AGENT PARTIES") HAVE ANY
LIABILITY TO THE BORROWER, THE PARENT GUARANTOR ANY LENDER OR ANY
OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING,
WITHOUT LIMITATION, DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR
CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT,
CONTRACT OR OTHERWISE) ARISING OUT OF THE BORROWER'S, THE PARENT
GUARANTOR'S OR THE AGENT'S TRANSMISSION OF COMMUNICATIONS THROUGH
THE INTERNET, EXCEPT TO THE EXTENT THE LIABILITY OF ANY AGENT
PARTY IS FOUND BY A COURT OF COMPETENT JURISDICTION TO HAVE
RESULTED PRIMARILY FROM SUCH AGENT PARTY'S GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT.

         (e) The Agent agrees that the receipt of the Communications by
the Agent at its e-mail address set forth above shall constitute
effective delivery of the Communications to the Agent for
purposes of the Financing Documents.  Each Lender agrees that
notice to it (as provided in the next sentence) specifying that
the Communications have been posted to the Platform shall
constitute effective delivery of the Communications to such
Lender for purposes of the Financing Documents.  Each Lender
agrees (i) to notify the Agent in writing (including by
electronic communication) from time to time of such Lender's
e-mail address to which the foregoing notice may be sent by
electronic transmission and (ii) that the foregoing notice may be
sent to such e-mail address.

         (f)  Nothing herein shall prejudice the right of the Agent or any
Lender to give any notice or other communication pursuant to any
Financing Document in any other manner specified in such
Financing Document.


         SECTION 9.03. No Waiver; Remedies.  No failure on the
part of any Lender or the Agent to exercise,  and  no  delay in
exercising, any right  hereunder  or under  any Note shall operate
as a waiver thereof; nor shall  any single  or partial exercise of
any such right preclude any  other or  further exercise thereof or
the exercise of any other  right. The remedies herein provided are
cumulative and not exclusive  of any remedies provided by law.

         SECTION 9.04. Costs and Expenses.   (a)   The  Borrower
agrees to  pay  on  demand  all reasonable costs and expenses of the
Agent in connection with the preparation,  execution, delivery,
modification and amendment  of the  Financing Documents and the other
documents to be  delivered hereunder,  including, without limitation,
(A) all due diligence, collateral  review, syndication (including
printing, distribution and   bank   meetings),  transportation,
computer,  duplication,appraisal,  insurance obtained by any Lender in
accordance  with the Collateral Documents, consultant search, filing and
recording fees, and audit expenses and (B) the reasonable fees and
expenses of counsel for the Agent with respect thereto and with respect
to advising  the  Agent as to its rights and responsibilities  under
the  Financing Documents, with respect to negotiations  with  any
Loan  Party or with other creditors of any Loan Party or  any  of
its  Subsidiaries  arising out of any Event  of  Default  or  any
Default  that  is  not reasonably likely to be cured  within  the

                           79

applicable grace period and with respect to presenting claims  in
or  otherwise  participating in or monitoring any  bankruptcy  or
insolvency  relating  to any Loan Party or any  of  its  Material
Subsidiaries  as a debtor (or other similar proceeding  involving
creditors' rights generally and any proceeding ancillary  thereto
in respect of any Loan Party or any of its Material Subsidiaries)
and  (ii) all costs and expenses of the Agent and each Lender  in
connection  with  the  enforcement of  the  Financing  Documents,
whether  in  any  action, suit or litigation, or any  bankruptcy,
insolvency  or  other  similar  proceeding  affecting  creditors'
rights  generally (including, without limitation, the  reasonable
fees  and expenses of counsel for the Agent and each Lender  with
respect thereto) in respect of such Financing Documents.

         (b)  The Borrower agrees to indemnify and hold harmless the
Agent,  each Lead Arranger, the Syndication Agent and each Lender
and  each  of  their  Affiliates and their  officers,  directors,
employees,  agents  and advisors (each, an  "Indemnified  Party")
from and against any and all claims, damages, losses, liabilities
and  expenses (including, without limitation, reasonable fees and
expenses  of  counsel) that may be incurred  by  or  asserted  or
awarded  against any Indemnified Party, in each case arising  out
of  or  in  connection  with or by reason of (including,  without
limitation,  in connection with any investigation, litigation  or
proceeding  or preparation of a defense in connection  therewith)
this  Agreement  and the other Financing Documents,  any  of  the
transactions  contemplated hereby or thereby  or  the  actual  or
proposed  use of the proceeds of the Advances, or the  actual  or
alleged  presence of Hazardous Materials on any property  of  the
Borrower  or  any of its Subsidiaries or the Parent Guarantor  or
any  Environmental Action relating in any way to the Borrower  or
any  of  its Subsidiaries or the Parent Guarantor except  to  the
extent such claim, damage, loss, liability or expense is found by
a  court  of  competent jurisdiction to have resulted  from  such
Indemnified  Party's  gross  negligence  or  willful  misconduct;
provided the Borrower shall have no liability in respect  of  any
tax  imposed  with respect to this Agreement or  any  transaction
hereunder  or thereunder except as specifically provided  for  in
Section  2.12,  and provided further that the indemnity  in  this
Section  9.04(b)  shall  not cover any claims,  damages,  losses,
liabilities  and expenses arising primarily out of  the  Aircraft
Security  Agreement  or relating to the Aircraft,  all  of  which
shall be covered solely to the extent provided in Section 5.08 of
the   Aircraft   Security  Agreement.   In   the   case   of   an
investigation,  litigation  or  other  proceeding  to  which  the
indemnity  in this Section 9.04(b) applies, such indemnity  shall
be  effective  whether or not such investigation,  litigation  or
proceeding  is  brought by any Loan Party, its directors  or  its
equityholders or creditors, whether or not any Indemnified  Party
is   a   party  thereto  and  whether  or  not  the  transactions
contemplated  hereby are consummated.  The  Agent,  each  of  its
Affiliates  and their officers, directors, employees, agents  and
advisors  agree  to provide the Borrower with ten Business  Days'
notice  prior  to the settlement of any claim under this  Section
9.04(b); and each other Indemnified Party agrees to consult  with
the  Borrower  prior to the settlement of any  claim  under  this
Section  9.04(b).   The Borrower also agrees not  to  assert  any
claim  against  the  Agent,  any Lead Arranger,  the  Syndication
Agent,  any  Lender, any of their Affiliates,  or  any  of  their
respective directors, officers, employees, attorneys and  agents,
on  any theory of liability, for special, indirect, consequential
or  punitive damages (including, without limitation, any loss  of
profits,  business  or  anticipated  savings)  relating  to   the
Facilities,  the  actual or proposed use of the proceeds  of  the
Advances,  the  Financing Documents or any  of  the  transactions
contemplated by the Financing Documents.

                           80


         (c)  If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the
account of a Lender other than on the last day of the Interest
Period for such Advance, as a result of a payment or Conversion
pursuant to Section 2.05, 2.07 or 2.09, acceleration of the
Advances pursuant to Section 6.01 or for any other reason or by
an Eligible Assignee to a Lender other than on the last day of
the Interest Period for such Advance upon an assignment of rights
and obligations under this Agreement pursuant to Section 9.07 as
a result of a demand by the Borrower pursuant to Section 9.07(a),
the Borrower shall, within 15 days after demand by such Lender,
reimburse such Lender for any resulting loss or expense incurred
by it (or by an existing or prospective participant in the
related Advance), including (without limitation) any loss
incurred in obtaining, liquidating or employing deposits from
third parties, but excluding loss of margin for the period after
any such payment or failure to borrow, provided that such Lender
shall have delivered to the Borrower a certificate setting forth
in reasonable detail calculations as to the amount of such loss
or expense, which certificate shall be conclusive in the absence
of manifest error.

         (d)  Without prejudice to the survival of any other agreement of
the Borrower hereunder or under any other Financing Document, the
agreements and obligations of the Borrower contained in Sections
2.09, 2.12 and 9.04 shall survive the payment in full of
principal, interest and all other amounts payable hereunder or
under any other Financing Document.

         (e)  If any Loan Party fails to pay when due any costs, expenses
or other amounts payable by it under any Financing Document in
respect of any Collateral, including, without limitation, fees
and expenses of counsel and indemnities, such amount may be paid
on behalf of such Loan Party by the Agent, in its sole
discretion.


         SECTION 9.05. Right of Set-off. Upon  (i) the occurrence
and during the continuance of any Event of Default and (ii) the making
of the request or the granting  of  the consent specified by Section 6.01
to  authorize the  Agent  to  declare  the Notes due and all  interest
payable pursuant  to the provisions of Section 6.01, the Agent  and  each
Lender   and  each  of  their  respective  Affiliates  is  hereby
authorized  at  any time and from time to time,  to  the  fullest
extent  permitted  by  law, to set off  and  apply  any  and  all
deposits  (general  or  special, time or demand,  provisional  or
final) at any time held and other indebtedness at any time  owing
by  the Agent, such Lender or such Affiliate to or for the credit
or  the  account  of  the Borrower against any  and  all  of  the
Obligations of the Borrower now or hereafter existing  under  the
Financing  Documents,  whether or not the Agent  or  such  Lender
shall  have made any demand under this Agreement or such Note  or
Notes and although such Obligations may be unmatured.  The Agent,
each  Lender  and  each  of  their respective  Affiliates  agrees
promptly  to  notify  the Borrower after  any  such  set-off  and
application; provided that the failure to give such notice  shall
not  affect  the  validity of such set-off and application.   The
rights  of  the  Agent, each Lender and each of their  respective
Affiliates under this Section are in addition to other rights and
remedies (including, without limitation, other rights of set-off)
that such Lender may have.

         SECTION 9.06. Binding Effect.   This  Agreement shall become
effective (other  than Section 2.01, which shall only become effective
upon satisfaction of  the  conditions precedent set forth in Section 3.01)
when  it shall  have  been executed by the Borrower, the Parent  Guarantor
and the Agent and when the Agent shall have been notified by each
Initial  Lender  that  such Initial Lender has  executed  it  and
thereafter shall be binding upon and inure to the benefit of  the

                           81

Borrower,  the  Parent Guarantor, the Agent and each  Lender  and
their  respective successors and permitted assigns, except  that,
subject to Section 5.02(b), neither the Parent Guarantor nor  the
Borrower  shall have the right to assign its rights hereunder  or
any  interest  herein without the prior written  consent  of  the
Lenders.

         SECTION 9.07. Assignments and Participations.   (a)   Each
Lender  may and,  if  demanded  by  the Borrower  (following a demand
by such Lender pursuant to  Section 2.09  or  2.12)  upon at least 5
Business Days'  notice  to  such Lender and the Agent, will assign to
one or more Persons all or a portion  of  its  rights  and obligations
under  this  Agreement (including,  without  limitation,  all  or  a
portion   of   its Commitment and the Advances owing to it); provided,
however, that (i)  each  such  assignment shall be of a  constant,  and
not  a varying,  percentage of all rights and obligations under  any  or
all  Facilities,  (ii) except in the case of an assignment  to  a
Person  that, immediately prior to such assignment, was a  Lender
or  an  assignment  of all of a Lender's rights  and  obligations
under  this  Agreement,  the amount  of  the  Commitment  of  the
assigning  Lender being assigned pursuant to each such assignment
(determined as of the date of the Assignment and Acceptance  with
respect  to  such  assignment) shall in no  event  be  less  than
$1,000,000  or  an  integral multiple  of  $1,000,000  in  excess
thereof,  (iii)  each such assignment shall  be  to  an  Eligible
Assignee, (iv) each such assignment made as a result of a  demand
by  the  Borrower  pursuant  to this  Section  9.07(a)  shall  be
arranged  by the Borrower after consultation with the  Agent  and
shall  be  either an assignment of all the rights and obligations
of  the assigning Lender under this agreement or an assignment of
a  portion of such rights and obligations made concurrently  with
another  such assignment or other such assignments that  together
cover  all of the rights and obligations of the assigning  Lender
under  this Agreement, (v) no Lender shall be obligated  to  make
any  such  assignment  as a result of a demand  by  the  Borrower
pursuant  to  this Section 9.07(a) unless and until  such  Lender
shall have received one or more payments from either the Borrower
or one or more Eligible Assignees in an aggregate amount at least
equal  to  the  aggregate  outstanding principal  amount  of  the
Advances  owing  to such Lender, together with  accrued  interest
thereon  to the date of payment of such principal amount and  all
other  amounts payable to such Lender under this Agreement,  (vi)
the parties to each such assignment shall execute and deliver  to
the  Agent, for its acceptance and recording in the Register,  an
Assignment and Acceptance and a processing and recordation fee of
$3,500,  provided, however, that in the case of  each  assignment
made  as  a  result of a demand by the Borrower, such recordation
fee  shall  be  payable  by  the Borrower  except  that  no  such
recordation  fee  shall be payable in the case of  an  assignment
made  at the request of the Borrower to an Eligible Assignee that
is an existing Lender, (vii) any Lender may, without the approval
of  the  Borrower and the Agent, but with notice to the  Borrower
and  the Agent, assign all or a portion of its rights to  any  of
its  Affiliates  and (viii) if the assignee is  not  incorporated
under the laws of the United States or a state thereof, it shall,
on  the  date of the assignment, deliver to the Borrower and  the
Agent certification as to exemption from deduction or withholding
of  any  United  States federal income taxes in  accordance  with
Section  2.12.   Upon  such execution, delivery,  acceptance  and
recording,  from and after the effective date specified  in  each
Assignment and Acceptance, (x) the assignee thereunder shall be a
party  hereto  and,  to  the extent that rights  and  obligations
hereunder  have  been assigned to it pursuant to such  Assignment
and  Acceptance,  have  the rights and obligations  of  a  Lender
hereunder  and (y) the Lender assignor thereunder shall,  to  the
extent  that rights and obligations hereunder have been  assigned
by  it pursuant to such Assignment and Acceptance, relinquish its
rights (other than the rights under Sections 2.09, 2.12 and  9.04
to  the  extent any claim thereunder relates to an event  arising
prior  to  such assignment) and be released from its  obligations

                           82

under  this  Agreement  (and, in the case of  an  Assignment  and
Acceptance covering all or the remaining portion of an  assigning
Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto).

         (b)  By executing and delivering an Assignment and Acceptance,
the  assigning  Lender  thereunder and  the  assignee  thereunder
confirm to and agree with each other and the other parties hereto
as  follows:   (i) other than as provided in such Assignment  and
Acceptance,  such  assigning Lender makes  no  representation  or
warranty  and  assumes  no responsibility  with  respect  to  any
statements,  warranties  or  representations  made   in   or   in
connection   with  any  Financing  Document  or  the   execution,
legality,  validity, enforceability, genuineness, sufficiency  or
value  of, or the perfection or priority of any lien or  security
interest  created  or  purported  to  be  created  under  or   in
connection  with, any Financing Document or any other  instrument
or document furnished pursuant hereto; (ii) such assigning Lender
makes no representation or warranty and assumes no responsibility
with respect to the financial condition of any Loan Party or  the
performance  or  observance by any  Loan  Party  of  any  of  its
obligations under any Financing Document or any other  instrument
or  document  furnished  pursuant thereto;  (iii)  such  assignee
confirms  that it has received a copy of this Agreement, together
with  copies of the financial statements referred to  in  Section
4.01 and Section 4.02 and such other documents and information as
it  has  deemed appropriate to make its own credit  analysis  and
decision to enter into such Assignment and Acceptance; (iv)  such
assignee will, independently and without reliance upon the Agent,
such  assigning  Lender or any other Lender  and  based  on  such
documents  and  information as it shall deem appropriate  at  the
time, continue to make its own credit decisions in taking or  not
taking  action  under this Agreement; (v) such assignee  confirms
that it is an Eligible Assignee; (vi) such assignee appoints  and
authorizes  the Agent to take such action as agent on its  behalf
and  to  exercise such powers and discretion under the  Financing
Documents  as  are  delegated to the Agent by the  terms  hereof,
together  with  such  powers  and discretion  as  are  reasonably
incidental thereto; and (vii) such assignee agrees that  it  will
perform  in  accordance with their terms all of  the  obligations
that  by the terms of this Agreement are required to be performed
by it as a Lender.

         (c)  The Agent, acting for this purpose (but only for this
purpose) as the agent of the Borrower, shall maintain at its
address referred to in Section 9.02 a copy of each Assignment and
Acceptance delivered to and accepted by it and a register for the
recordation of the names and addresses of the Lenders and the
Commitment of, and principal amount of the Advances owing to,
each Lender from time to time (the "Register").  The entries in
the Register shall be conclusive and binding for all purposes,
absent manifest error, and the Borrower, the Agent and the
Lenders shall treat each Person whose name is recorded in the
Register as a Lender hereunder for all purposes of this
Agreement.  The Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice.

         (d)  Upon its receipt of an Assignment and Acceptance executed by
an assigning Lender and an assignee representing that it is an
Eligible Assignee, the Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of
Exhibit C hereto, (i) accept such Assignment and Acceptance, (ii)
record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower.

                           83


         (e)  Each Lender may sell participations to one or more banks or
other entities (other than any Loan Party or any of its
Affiliates) in or to all or a portion of its rights and
obligations under this Agreement (including, without limitation,
all or a portion of its Commitment and the Advances owing to it);
provided, however, that (i) such Lender's obligations under this
Agreement (including, without limitation, its Commitment to the
Borrower hereunder) shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii)  the Borrower, the
Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights
and obligations under this Agreement and (iv) no participant
under any such participation shall have any right to enforce the
obligations of the Loan Parties hereunder or to approve any
amendment or waiver of any provision of this Agreement, or any
consent to any departure by any Loan Party therefrom, except to
the extent that such amendment, waiver or consent would reduce
the principal of, or interest on, the Advances or any fees or
other amounts payable hereunder, in each case to the extent
subject to such participation, or postpone any date fixed for any
payment of principal of, or interest on, the Advances or any fees
or other amounts payable hereunder, in each case to the extent
subject to such participation, or release all or substantially
all of the Collateral.

         (f)  No Eligible Assignee or other transferee of any Lender's
rights shall be entitled to receive any greater payment under
Section 2.09 than such Lender would have been entitled to receive
with respect to the rights transferred, unless such transfer is
made with the Borrower's prior written consent or by reason of
the provision of Section 2.16 requiring such Lender to designate
a different Applicable Lending Office under certain
circumstances.  The Borrower shall not be obligated to make any
greater payment under the Financing Documents than it would have
been required to make in the absence of any participation.

         (g)  Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to
this Section 9.07, disclose to the assignee or participant or
proposed assignee or participant, any information relating to the
Borrower furnished to such Lender by or on behalf of the
Borrower; provided that, prior to any such disclosure, the
assignee or participant or proposed assignee or participant shall
agree to preserve the confidentiality of any Confidential
Information received by it from such Lender.

         (h)  Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest
in all or any portion of its rights under this Agreement
(including, without limitation, the Advances owing to it) in
favor of any Federal Reserve Bank in accordance with Regulation A
of the Board of Governors of the Federal Reserve System.

         (i)  Notwithstanding anything to the contrary contained herein,
any Lender that is a fund that invests in bank loans may create a
security interest in all or any portion of the Advances owing to
it to the trustee for holders of obligations owed, or securities
issued, by such fund as security for such obligations or
securities, provided that unless and until such trustee actually
becomes a Lender in compliance with the other provisions of this
Section 9.07, (i) no such pledge shall release the pledging
Lender from any of its obligations under the Financing Documents
and (ii) such trustee shall not be entitled to exercise any of
the rights of a Lender under the Financing Documents even though

                           84

such trustee may have acquired ownership rights with respect to
the pledged interest through foreclosure or otherwise.

         (j)  If the Borrower wishes to replace Advances or the
Commitments under any Facility with ones having different terms,
it shall have the option, with the consent of the Agent and
subject to at least three Business Days' advance notice to the
Lenders under such Facility, instead of prepaying the Advances or
reducing or terminating the Commitments to be replaced, to (i)
require the Appropriate Lenders to assign such Advances or
Commitments to the Agent or its designees and (ii) amend the
terms thereof in accordance with Section 9.01 (with such
replacement, if applicable, being deemed to have been made
pursuant to Section 9.01(c)).  Pursuant to any such assignment,
all Advances and Commitments to be replaced shall be purchased at
par (allocated among the Appropriate Lenders under such Facility
in the same manner as would be required if such Advances were
being optionally prepaid or such Commitments were being
optionally reduced or terminated by the Borrower), accompanied by
payment of any accrued interest, premiums (including any premiums
payable pursuant to Section 2.08(a), it being understood that any
assignment pursuant to this Section 9.07(j) shall be deemed an
optional prepayment under Section 2.08(a) for purposes of the
payment of such premiums) and fees thereon and any amounts owing
pursuant to Section 9.04(c).  By receiving such purchase price,
the Appropriate Lenders under such Facility shall automatically
be deemed to have assigned their Commitments under such Facility
pursuant to the terms of the form of Assignment and Acceptance
attached hereto as Exhibit C, and accordingly no other action by
such Lenders shall be required in connection therewith.  The
provisions of this paragraph are intended to facilitate the
maintenance of the perfection and priority of existing security
interests in the Collateral during any such replacement.


         SECTION 9.08. Confidentiality. Neither the Agent nor any
Lender shall disclose any Confidential Information to any Person
without the consent of the Borrower,  other  than  (a)  to  the
Agent's  or  such  Lender's Affiliates  and their officers, directors,
employees, agents  and advisors  and  to  actual or prospective Eligible
Assignees  and participants,  and  then  only on a confidential  basis,
(b)  as required  by  any  law, rule or regulation, (c) as  requested
or required  by any state, Federal or foreign authority or  examiner
(including the National Association of Insurance Commissioners or
any   similar   organization   or   quasi-regulatory   authority)
regulating such Lender, (d) to any rating agency when required by
it,  provided  that,  prior to any such disclosure,  such  rating
agency  shall  undertake to preserve the confidentiality  of  any
Confidential Information relating to the Loan Parties received by
it  from  such  Lender, (e) in connection with any litigation  or
proceeding  to  which  the Agent or such Lender  or  any  of  its
Affiliates may be a party or as required by judicial process,  or
(f)  in connection with the exercise of any right or remedy under
this Agreement or any other Financing Document; provided that  if
any party hereto (such party, the "Disclosing Party") is required
to  disclose any Confidential Information pursuant to clause  (e)
above,  the  Disclosing Party will, to the  extent  permitted  by
applicable  law, promptly notify the other parties  hereto  (such
other  parties,  the  "Non-Disclosing  Parties")  prior  to  such
disclosure  to  enable  the  Non-Disclosing  Parties  to  seek  a
protective  order or to take other action that the Non-Disclosing
Parties in their reasonable discretion deem appropriate, and  the
Disclosing  Party will use reasonable efforts to  cooperate  with
the   Non-Disclosing  Parties  in  their  efforts  to  obtain   a
protective  order or other reasonable assurance that confidential
treatment will be accorded the Confidential Information.


                           85


         SECTION 9.09. Release of Collateral.  Upon the sale, lease,
transfer or other disposition of  any  item of Collateral of any Loan
Party in accordance  with the  terms  of  the Financing Documents, the
Agent will,  at  the Borrower's  expense, execute and deliver to such
Loan Party  such documents  as such Loan Party may reasonably request
to  evidence the  release  of such item of Collateral from the assignment
and security  interest  granted  under the  Collateral  Documents  in
accordance with the terms of the Financing Documents.


         SECTION 9.10. Governing Law.   This  Agreement shall be
governed by, and construed in accordance with, the laws of the State
of New York.


         SECTION 9.11. Execution in Counterparts. This  Agreement may
be executed in  any  number  of counterparts  and  by  different  parties
hereto   in   separate counterparts, each of which when so executed shall
be  deemed  to be  an  original and all of which taken together shall
constitute one  and the same agreement.  Delivery of an executed counterpart
of  a  signature  page to this Agreement by telecopier  shall  be
effective as delivery of a manually executed counterpart of  this
Agreement.


         SECTION 9.12. Jurisdiction, Etc. (a)   Each  of the parties
hereto hereby irrevocably and  unconditionally submits, for itself and
its property, to the nonexclusive jurisdiction of any New York State court
or  federal court  of the United States of America sitting in New York
City, and  any  appellate  court from any thereof,  in  any  action  or
proceeding arising out of or relating to this Agreement or any of
the  other  Financing Documents to which it is a  party,  or  for
recognition  or  enforcement of any judgment,  and  each  of  the
parties hereto hereby irrevocably and unconditionally agrees that
all  claims  in respect of any such action or proceeding  may  be
heard and determined in any such New York State court or, to  the
extent  permitted  by law, in such federal court.   Each  of  the
parties hereto agrees that a final judgment in any such action or
proceeding  shall  be  conclusive and may be  enforced  in  other
jurisdictions  by  suit on the judgment or in  any  other  manner
provided  by  law.   Nothing in this Agreement shall  affect  any
right  that any party may otherwise have to bring any  action  or
proceeding  relating  to  this Agreement  or  any  of  the  other
Financing Documents in the courts of any jurisdiction.

         (b)  Each of the parties hereto irrevocably and unconditionally
waives,  to the fullest extent it may legally and effectively  do
so, any objection that it may now or hereafter have to the laying
of  venue  of any suit, action or proceeding arising  out  of  or
relating  to  this  Agreement  or  any  of  the  other  Financing
Documents to which it is a party in any New York State or federal
court.  Each of the parties hereto hereby irrevocably waives,  to
the   fullest  extent  permitted  by  law,  the  defense  of   an
inconvenient  forum  to  the  maintenance  of  such   action   or
proceeding in any such court.

                           86


         SECTION 9.13. Waiver of Jury Trial.   Each  of  the
Borrower, the Parent Guarantor,  the Agent  and  the Lenders hereby
irrevocably waives  all  right  to trial  by jury in any action,
proceeding or counterclaim (whether based  on contract, tort or otherwise)
arising out of or relating to  any of the Financing Documents the
Advances or the actions of the  Agent  or  any  Lender  in the negotiation,
administration, performance or enforcement thereof.













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                           87



          IN WITNESS WHEREOF, the parties hereto have caused this
Agreement  to be executed by their respective officers  thereunto
duly authorized, as of the date first above written.


                              AMERICAN AIRLINES, INC.,
                              as Borrower


                              By
                                Name:
                                Title:


                              AMR CORPORATION,
                              as Parent Guarantor


                              By
                                Name:
                                Title:


                              CITICORP USA, INC.,
                              as Agent


                              By
                                Name:
                                Title:




                           SCHEDULE I
           COMMITMENTS AND APPLICABLE LENDING OFFICES

Name of     Revolving      Term 1      Domestic    Eurodollar
Lender       Credit 1     Commitment   Lending      Lending
            Commitment     Office       Office