Exhibit 10.12(b)
                              
          AMENDED AND RESTATED SEVERANCE AGREEMENT


      THIS  AMENDED  AND RESTATED SEVERANCE  AGREEMENT  (the
"Agreement") is made and entered into as of this 20th day of
January,  1999  (the  "Effective  Date"),  by  and   between
ATLANTIC   COAST   AIRLINES  HOLDINGS,  INC.,   a   Delaware
corporation ("ACAH"), ATLANTIC COAST AIRLINES, a  California
corporation  ("ACA")  (ACAH and ACA are herein  collectively
referred to as the "Company") and KERRY B. SKEEN ("Skeen").
                              
                      WITNESSETH THAT:

      WHEREAS, Skeen is currently employed by the Company as
Chief  Executive  Officer and President, and  in  connection
with  such  employment  entered into a  Severance  Agreement
(dated October 16, 1991), as amended (April 28, 1994,  April
27, 1995 and October 16, 1996), with the Company; and

     WHEREAS,  the  Company wishes to assure itself  of  the
continued services of Skeen; and

      WHEREAS,  the  Board of Directors of the  Company  has
determined that the best interests of the Company  would  be
served  by entering into this amended and restated Agreement
with Skeen; and

     WHEREAS,  this Amended and Restated Severance Agreement
is  intended to correct and restate the Severance  Agreement
dated July 20, 1998;

      NOW,  THEREFORE, the parties, for and in consideration
of  the  mutual  and  reciprocal  covenants  and  agreements
hereinafter  contained, and intending to  be  legally  bound
hereby, do contract and agree as follows:

     1.   Employment: Company hereby employs Skeen and Skeen
hereby  accepts employment by Company and agrees to  perform
his  duties and responsibilities hereunder upon all  of  the
terms and conditions as are hereinafter set forth.

      2.    Duties:  Skeen shall serve in the capacities  of
Chief Executive Officer and President of the Company and  of
any  other  entity(ies)  to which the Company's  obligations
under this Agreement shall be assigned pursuant to Paragraph
11.    Skeen  shall  be  responsible  for  supervising   and
directing all operations of the Company.  All other officers
of  the Company shall report to Skeen except the Chairman of
the  Board of Directors (to the extent such person is deemed
to be an officer).  Skeen shall otherwise be responsible for
carrying  out  all duties assigned to the President  by  the
Company's  Board  of Directors and under  ACAH's  and  ACA's
Bylaws.   The  Company shall use its good faith  efforts  to
ensure  that  Skeen continues to serve as a  member  of  the
Company's Board of Directors.

     3.    Terms  of Employment:  Skeen's term of employment
under  this  Agreement shall commence on the Effective  Date
and  shall  terminate on the last day of the calendar  month
which is thirty-six (36) calendar months after the Effective
Date,  unless  further  extended as hereinafter  set  forth.
Commencing  on each successive anniversary of the  Effective
Date,  the Agreement shall automatically be extended for  an
additional  twelve  (12) months without  further  action  by
either party unless one party provides the other sixty  (60)
days' written notice that such party does not wish to extend
the term of this Agreement.

     4.    Extent of Service:  Skeen shall devote such  time
and  attention  as  is required to perform  his  obligations
under  this  Agreement and will at all times faithfully  and
industriously,  consistent with his ability, experience  and
talent, perform his duties hereunder.

     5.    Compensation:  During the term of this Agreement,
Company  agrees to pay to Skeen, and Skeen agrees to  accept
from Company, in full payment for services rendered by Skeen
and  work  to  be performed by him under the terms  of  this
Agreement, the following:

           A.    An annual base salary of Two-Hundred Ninety
Five  Thousand  Dollars ($295,000) shall be paid  to  Skeen.
Commencing  October 1, 1998 and each October  1  thereafter,
the  amount  of  Skeen's base salary shall be  increased  as
determined  by the Compensation Committee of  the  Board  of
Directors  of  the Company; provided, however,  that  in  no
event  shall  Skeen's annual base salary be  less  than  the
previous year's annual base salary. Skeen's base salary  for
each  year  shall be payable to him in accordance  with  the
reasonable payroll practices of the Company as from time  to
time in effect for executive employees (but in no event less
often than monthly).

           B.    Skeen  shall participate in  the  Company's
Management Incentive Program, or any successor bonus plan or
program  for  management employees.   In  addition,  if  the
Company  maintains an additional executive/management  bonus
plan,  then  Skeen's bonus arrangement  shall  be  at  least
consistent with the provisions of such bonus plan.

           C.    Skeen  shall be eligible for an  additional
annual  bonus  under  an  executive performance  bonus  plan
currently known as Senior Management Incentive Plan  for  so
long  as the Board of Directors determines to maintain  such
plan.   Under such plan, each calendar year, Skeen shall  be
entitled to receive a bonus equal to specified percentage of
base  salary  upon the attainment of certain pre-established
goals.  The maximum bonus under this plan assuming all goals
are  met  will  not be less than 100% of base salary.   Such
goals  and percentage of salary shall be determined  by  the
Compensation  Committee of the Board  of  Directors  of  the
Company  prior to the commencement of each plan  year.   The
bonus  amount each year shall be paid in a single cash  lump
sum paid at the time period provided under such plan, at the
same time as paid to other eligible employees, and generally
no later than 90 days after the end of the plan period.

      D.    Skeen  will be entitled to deferred compensation
("Deferred Compensation") as described in this section.  The
Company will make Deferred Compensation contributions at the
rate  of  fifty percent (50%) of Skeen's annual base salary.
Deferred  Compensation will be based on Skeen's annual  base
salary  in effect on October 1 in each year beginning  1998,
and  will  be payable as of October 1 in each year beginning
1998.   Such  contributions will be applied  toward  funding
such  deferred compensation program as the Company and Skeen
may  agree to from time to time, consistent with the funding
and vesting provisions of this Agreement.
     
The  method  of  funding of Deferred Compensation,  and  the
timing  of  the  actual payment of contributions,  shall  be
agreed between the Company and Skeen from time to time.   As
of  the  date hereof, the Deferred Compensation  program  is
provided  under  a  split dollar life insurance  arrangement
with   Phoenix  Home  Life  Mutual  -  (the  "Split   Dollar
Agreement".  The Company may implement a substitute Deferred
Compensation  plan not tied to a Split Dollar  Agreement  so
long as (1) the amount contributed by the Company on Skeen's
behalf  equals  the  amount set forth herein,  and  (2)  the
vesting schedule, credit for Years of Service, and terms  of
distribution are all at least as favorable to Skeen  as  set
forth  herein.  The Company shall continue to abide  by  the
terms  of  the Split Dollar Agreement with Skeen  previously
executed the 29th day of December, 1995, which shall provide
for  a split dollar plan for a policy of insurance upon  the
life  of  Skeen in a face amount to be mutually agreed  upon
between  Skeen and the Company.  For so long  as  the  Split
Dollar  Agreement  shall serve as the deferred  compensation
program  under  this  Agreement, the following  terms  shall
apply:

           (i)  Skeen shall be the owner of the policy under
the  Split  Dollar  Agreement and will  have  the  right  to
designate  his beneficiary with respect to proceeds  of  the
policy  payable  upon  his  death; provided,  however,  that
notwithstanding  the  foregoing, the Company  shall  have  a
collateral  assignment of the policy  as  security  for  the
repayment  of the amounts contributed by the Company  toward
the payment of premiums for the policy.

           (ii)  The  Company shall, except as  provided  in
Paragraph  5D(iii)  below, each year as required  under  the
Split  Dollar Agreement and the related policy, pay,  on  or
before  the  due date(s) under the terms of the policy,  the
entire  amount  of  the annual premium  due  on  the  policy
acquired   pursuant  to  the  terms  of  the  Split   Dollar
Agreement. The annual premium due on the policy will be  the
amount   of   the   Company's   contribution   to   deferred
compensation calculated as described above.

           (iii)     The "Deferred Compensation Ending Date"
shall mean the date of termination of Skeen's employment  if
Skeen's  employment with the Company is  terminated  at  any
time  under  circumstances  that  do  not  entitle  him   to
Severance  Compensation  pursuant  to  Section  10  of  this
Agreement,  or  shall  mean the last day  of  the  Severance
Period  (as  defined in Section 10) if Skeen is entitled  to
Severance Compensation.  During a Severance Period, Deferred
Compensation  shall  continue  pursuant  to  the  terms   of
10.E.(iii)  hereof.  Upon the Deferred  Compensation  Ending
Date, the following shall occur:
     
               (a)   The  applicable  vested  percentage  of
          Skeen's interest in Deferred Compensation shall be
          calculated  as  provided herein.   Skeen  will  be
          entitled  to  receive  the  deferred  compensation
          benefit  provided under such deferred compensation
          program  only  to the extent he is vested  in  the
          Company's  contributions.  Vesting will  be  based
          upon "Years of Service", with Skeen to be credited
          with  one Year of Service for completion  of  each
          twelve (12) consecutive month period of employment
          with  the  Company beginning January 1,  1996  and
          ending  on the Deferred Compensation Ending  Date.
          (That  is,  Skeen will be credited with  Years  of
          Service  for any applicable Severance  Period,  as
          further  provided  in Section  10.E.(iv)  hereof.)
          Skeen   will   become  vested  in   the   deferred
          compensation based on the following schedule:

                              
              YEARS OF SERVICE    PERCENTAGE VESTED
     
                 Less than 4              0%
          At least 4 but less than 5     25%
          At least 5 but less than 6     35%
          At least 6 but less than 7     50%
          At least 7 but less than 8     65%
          At least 8 but less than 9     80%
                  At least 9             100%

          In the event of a Change in Control (as defined in
          Paragraph 8.C. of this Agreement) of the  Company,
          Skeen shall become immediately 100% vested in  his
          Deferred  Compensation amount notwithstanding  the
          above vesting schedule.
               
               (b)    The   Split  Dollar  Agreement   shall
          continue  in  full  force and effect  and  survive
          separate  and apart from this Agreement; provided,
          however,  that the Company shall, at its election,
          have  no further obligation to pay any premium  on
          the  policy under the Split Dollar Agreement which
          has  a  due  date after the Deferred  Compensation
          Ending   Date   and  such  obligation   shall   be
          transferred to Skeen.

               (c)   The Company shall pay to Skeen whatever
          "Deferred  Compensation" amount is  equal  to  the
          applicable  vested percentage of the total  policy
          premiums paid by the Company pursuant to the Split
          Dollar  Agreement.  The Company  shall  make  this
          payment  within  thirty (30)  days  following  the
          Deferred Compensation Ending Date by releasing its
          interest  in the policy, or a portion thereof,  on
          Skeen's life acquired pursuant to the terms of the
          Split Dollar Agreement, or any or all of the  paid
          up  additions  standing  to  the  credit  of  such
          policy,  if any, such that such released  interest
          equals  the Deferred Compensation amount  paid  to
          Skeen  pursuant to this Paragraph 5D.  The Company
          agrees  that  the  amount of any such  release  of
          interest by the Company shall reduce the amount of
          "Liabilities"  (as  such term is  defined  in  the
          Agreement  of  Assignment of Life Insurance  Death
          Benefit  As Collateral entered into between  Skeen
          and  the  Company  in connection  with  the  Split
          Dollar   Agreement)  owed  to   the   Company   in
          connection  with  the Split Dollar  Agreement  and
          related     Collateral    Assignment    Agreement.
          Accordingly, the Company also agrees to reduce  to
          such  extent  its  collateral  assignment  of  the
          policy pursuant to the Split Dollar Agreement  and
          related Collateral Assignment Agreement.

     E.     The   Company   may   pay  Skeen   discretionary
compensation,  bonuses and benefits  in  addition  to  those
provided for herein in such amounts and at such times as the
Compensation  Committee of the Board  of  Directors  of  the
Company shall determine.

      6.  Benefits:

           A.    The Company shall pay for or provide  Skeen
such  vacation time and benefits, including but not  limited
to,   coverage  under  Company's  major  medical,  accident,
health, dental, disability and life insurance plans, as  are
made  available  to  other executive  employees  of  Company
generally (and, to the extent provided by such policies,  to
Skeen's dependents).

          B.    The  Company  agrees to  promptly  reimburse
Skeen   for  any  otherwise  unreimbursed  premiums   and/or
uncovered  medical expenses up to $10,000 per calendar  year
under  a  written medical reimbursement plan maintained  for
Skeen  and other key executive employees.  If such  payments
are  taxable to Skeen, the Company shall pay Skeen a  gross-
up  equal  to the estimated income, FICA and Medicare  taxes
due  with  respect to such reimbursement, with  federal  and
state  income taxes being estimated at the highest  marginal
rates.

          C.   Skeen shall be eligible to participate in any
profit sharing plan, employee stock ownership plan or  other
qualified  retirement plan adopted by Company  to  the  same
extent as other executive employees of Company.  Skeen shall
also  be eligible to participate in any stock option,  stock
appreciation rights or stock purchase plans or  programs  or
nonqualified deferred compensation arrangements of  Company,
which  participation shall be at levels at  least  equal  in
value  to  such benefits provided by Company  to  other  key
executive employees of Company.

      7.   Reimbursement of Expenses:  The Company agrees to
promptly  reimburse Skeen, within fifteen  (15)  days  after
presentation    of    receipts   and    other    appropriate
documentation,  for all reasonable, ordinary  and  necessary
travel costs and other necessary expenses incurred by  Skeen
in performing his duties pursuant to this Agreement.

     8.   Stock Options:

          A.    Company agrees to continue in force a  stock
option  plan  or one which is substantially similar  to  the
existing plan ("Stock Option Plan"), which has been approved
by  the  shareholders  of  the Company  and,  on  the  first
business  day  in each January commencing in January,  1999,
and  (subject  to  the  provisions of Paragraph  10.A.(vii))
continuing  so long as Skeen is employed by the  Company  to
grant  Skeen options under the Stock Option Plan to purchase
not less than 100,000 shares of the common stock of ACAH  at
the price per share at the closing of the trading market  on
the  last  business date prior to such grant.   The  Company
also  agrees  to  approve the issuance  of  such  additional
shares  as  are  necessary to enable Skeen to exercise  such
options.  The Company will not be required to reserve shares
from  existing plans to cover future obligations under  this
paragraph,  but  will  use  reasonable  efforts  to   obtain
shareholder approval as necessary from time to time to  make
a  sufficient  number of additional shares  available  on  a
timely   basis,  and  will  provide  Skeen  with  equivalent
alternative  compensation should approval not  be  obtained.
The terms of the grant of such options granted after January
1,  1998  shall provide that (a) Skeen's right  to  exercise
such options shall vest and become exercisable over the five-
year  period beginning on the date of each grant at the rate
of one-fifth per year (i.e., one-fifth shall vest and become
exercisable on the first anniversary of the grant)  so  long
as  Skeen  is employed by the Company, (b) Skeen's right  to
exercise  such  options to purchase  the  entire  number  of
shares  covered thereby shall become immediately 100% vested
in  the  event there is a Change in Control (as  hereinafter
defined)  or  in  the event Company shall  otherwise  become
obligated  to  provide Skeen with Severance Compensation  as
provided  in Paragraph 10.e. herein, (c) such options  shall
be  exercisable  for ten (10) years after the  date  of  the
grant  so long as Skeen is employed by the Company  and  (d)
Skeen  shall have the right to exercise such vested  options
within ninety (90) days following any termination of Skeen's
employment  except  that  in  the  case  of  termination  of
employment   for  which  Skeen  is  entitled  to  "Severance
Compensation" as provided herein, in which case the terms of
Paragraph 10.E.(iii) shall apply.

           B.   In addition to the foregoing, if the Company
in  the  exercise of its discretion, shall grant  Skeen  any
additional  stock options, such options shall contain  terms
and  conditions which are at least as favorable to Skeen  as
those set forth in this Paragraph 8. All outstanding options
previously  issued to Skeen prior to the Effective  Date  of
this Amended and Restated Severance Agreement shall also  be
subject  to the foregoing terms, except that options granted
on  or  before December 31, 1997 shall vest over three years
at  the  rate of one-third per year and except that no  such
terms shall be applicable to options intended to qualify  as
Incentive  Stock  Options if and to the  extent  such  terms
would  be  deemed to result in a "material modification"  of
such  options  (for example, Skeen will not be  entitled  to
more  than  90  days to exercise such options following  any
termination of employment other than on account of death  or
disability, in which case he will be entitled to one year to
exercise such options).
     
     C.   For purposes of this Agreement, a "Change in
Control" shall be deemed to occur on the earliest of (a)  an
acquisition (other than directly from Company) of any
securities of Company entitled to vote for the election of
Directors (the "Voting Securities") by any "person or group"
(within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934) other than an employee
benefit plan of Company, immediately after which such person
has "Beneficial Ownership" (within the meaning of Rule 13d-3
under the Exchange Act) of more than thirty percent (30%) of
the combined voting power of Company's then outstanding
Voting Securities; (b)  announcement by any "person or
group" (within the meaning of Section 13(d)(3) or 14(d)(2)
of the Securities Exchange Act of 1934) of its acceptance
for payment of securities tendered pursuant to a tender
offer or exchange offer initiated by such person owning or
representing securities constituting more than twenty
percent (20%) of the combined voting power of Company's then
outstanding Voting Securities; (c) the approval by the
Company's stockholders of (1) a merger, consolidation or
reorganization involving Company or a transfer of
substantially all of the assets of Company (other than to an
entity or entities owned by Company), unless the company
resulting from such merger, consolidation or reorganization
or the company to which such assets are transferred (the
"Surviving Corporation") shall adopt or assume this
Agreement and the stockholders of Company immediately before
such merger, consolidation or reorganization own, directly
or indirectly immediately following such merger,
consolidation or reorganization, at least eighty percent
(80%) of the combined voting power of the Surviving
Corporation in substantially the same proportion as their
ownership immediately before such merger, consolidation or
reorganization, or (2) a complete liquidation or dissolution
of Company; or (d)  persons who on the date of this
Agreement are directors of Company, together with people
nominated by a majority of them or by persons who were
nominated by them, cease for any reason to constitute a
majority of Company's Board of Directors.

     9.    Deductions: Deductions shall be made from Skeen's
compensation  for social security, Medicare, federal,  state
and  local  withholding taxes, and any other such  taxes  as
may  from  time  to  time be required  by  any  governmental
authority.

     10.   Termination: Skeen's employment with the  Company
shall  be  terminated only in accordance with the  following
provisions:

          A.   Disability.

               (i)  In the event Skeen shall become mentally
or  physically disabled so as to have been unable to perform
his  duties  hereunder for twelve (12)  consecutive  months,
subject  to  Skeen's  right to return to  work  as  provided
below,  Company  shall have the right to  terminate  Skeen's
employment  with Company upon the expiration of such  twelve
(12)  month  period; provided, however, that upon  any  such
termination Company shall be obligated to provide Skeen with
Severance  Compensation  as  provided  in  Paragraph   10.E.
herein.   Such twelve-month period shall be deemed  to  have
commenced on the date when Skeen is first unable to  perform
his  duties  on a substantially full-time basis  because  of
mental  or physical disability and shall end on the date  on
which  Skeen  shall  return  to  the  substantial  full-time
performance  of  his duties.  If at the expiration  of  such
twelve  (12)  month  period, the Company   shall  desire  to
terminate  Skeen on the basis of disability, it  shall  give
written  notice to him.  Skeen's employment shall thereafter
be terminated if he does not return to substantial full-time
performance  of  his  duties within ten (10)  calendar  days
after such notice is given.

                (ii)  Nothing  contained  herein  shall   be
construed  to  affect  Skeen's rights under  any  disability
insurance  or  similar  policy, whether  maintained  by  the
Company, Skeen or another party.  The Company may utilize  a
disability  policy  to  fund,  in  whole  or  in  part,  the
compensation that would be due to Skeen during the  term  of
or  in the event of a disability, in which case the proceeds
of  the  policy would not be in addition to any compensation
otherwise payable to Skeen.

                (iii)      For  purposes of this  Agreement,
Skeen shall be deemed to be disabled when he shall have been
absent  from his duties because of sickness, illness, injury
or  other  physical or mental infirmity on  a  substantially
full-time  basis.  In the event of a dispute as  to  whether
Skeen  is  disabled,  the  issue  of  the  determination  of
disability shall be submitted to a Board of Arbiters  for  a
binding decision under the procedures set forth in Paragraph
10.A.(v) below.

                 (iv)At  the  end  of any disability  (other
than  a  disability  that  results  in  the  termination  of
Skeen's employment with the Company), Skeen shall return  to
work  and  this  Agreement  shall continue  as  though  such
disability had not occurred.

               (v)   If  there  is a dispute as  to  whether
Skeen  is  subject  to any disability, the  issue  shall  be
submitted  to a Board of Arbiters (whose decision  shall  be
binding  on  the  Company  and Skeen)  consisting  of  three
persons:  one physician who specializes in the  physical  or
mental disability in dispute (hereinafter referred to  as  a
"Specialist") shall be appointed on behalf of Company by the
Board of Directors of Company (with Skeen having no vote  on
this  question); a second Specialist shall be  appointed  by
Skeen  and a third Specialist shall be appointed by the  two
Specialists  so appointed.  The decision of  a  majority  of
such  Specialists shall be binding upon the parties  hereto.
If  a  majority of the Specialists determines that Skeen  is
not   subject  to  any  disability  for  purposes  of   this
Agreement,  Skeen shall return to work under the  provisions
hereof.  Such Specialists may physically examine Skeen,  who
hereby  consents to such examination and to  make  available
any pertinent medical records.  The cost of such Specialists
shall be paid by Company.

                (vi)  If  it  is determined that  Skeen  can
return  to work hereunder on a part-time basis, the  parties
agree  to  use good faith efforts to negotiate the terms  of
Skeen's return to work.

               (vii)     During any period in which Skeen is
disabled  but his employment shall not have been terminated,
Skeen  shall  continue to receive his base  salary  and  any
applicable bonus, and shall continue to receive all benefits
as an employee and as provided herein generally. Any options
previously  granted  shall continue  to  vest,  but  no  new
options shall be issued to Skeen.

               (viii)    During any period in which Skeen is
disabled  but his employment shall not have been terminated,
Skeen  shall continue to be credited with Years  of  Service
for  purposes  of  vesting of Deferred Compensation  as  set
forth in Paragraph 5.D.

          B.   Death.

                (i)   Skeen's employment with Company  shall
terminate immediately upon Skeen's death; provided, however,
that  Company  shall be obligated to provide  the  Severance
Compensation  as  specified  in Paragraph  10.E.  herein  to
Skeen's estate, heirs or beneficiaries.

                 (ii)  Nothing  contained  herein  shall  be
construed  to affect Skeen's rights under any life insurance
or  similar policy, whether maintained by Company, Skeen  or
another  party.   The Company may utilize a  life  insurance
policy   to  fund,  in  whole  or  in  part,  the  Severance
Compensation that would be payable in the event  of  Skeen's
death,  in which case the proceeds of any such policy  other
than the Split Dollar Agreement would not be in addition  to
any  Severance  Compensation otherwise  payable  under  this
Paragraph 10.B.
     
          C.   Termination by Skeen.

               (i)  Without Good Reason.  Skeen may, without
"Good  Reason"  (as  hereinafter  defined),  terminate   his
employment  by  giving to Company sixty (60)  days'  written
notice  by Certified Mail, Return Receipt Requested, at  the
office  of  Company, and such termination shall be effective
on the sixtieth (60th) day following the date of such notice
(the  "Termination Date").  In such event, Skeen  (i)  shall
continue  to render his services up to the Termination  Date
if  so  requested  by Company and (ii)  shall  be  paid  his
regular base salary and shall receive all benefits up to the
Termination Date.  Skeen will be entitled to payment of  any
bonus due but not yet paid for prior bonus periods, and  for
a  pro-rata bonus amount for the bonus period in  which  the
termination  occurs pursuant to this Paragraph 10.C.(i)  but
will  not  be entitled to Severance Compensation or  to  any
other  compensation, bonus or fringe benefits accrued  after
the  Termination Date.  The bonus payable to Skeen  will  be
paid  at  the same time it would have been paid had  Skeen's
employment  not  been  terminated,  will  be  based  on  the
achievement  of targets for the entire bonus period  without
regard  to  interim results as of the termination date,  and
will  be  paid pro-rata based on the number of  full  months
Skeen  was employed within the bonus period divided  by  the
total number of months in the bonus period.

                (ii)  With Good Reason.  Skeen may terminate
his employment with Company immediately for Good Reason.  In
the  event Skeen's employment with Company is terminated  by
Skeen for Good Reason, Company shall be obligated to provide
Skeen  with Severance Compensation as provided in  Paragraph
10.E. herein".  Good Reason" shall mean any of the following
(without Skeen's express prior written consent):

                    (a)   The assignment to Skeen by Company
of  duties  inconsistent  with  Skeen's  positions,  duties,
responsibility  and status with Company, or any  removal  of
Skeen  from  or  any  failure  to  re-elect  Skeen  to   his
positions,  including  his  position  as  a  member  of  the
Company's Board of Directors (except in connection with  the
termination of his employment for disability, death  or  for
cause as provided herein), unless cured within fifteen  (15)
days of Skeen giving written notice thereof to the Company.

                    (b)   Any material adverse change in any
benefit  plan or arrangement in which Skeen is participating
and which is not applicable generally to other key executive
employees  of  Company  who  participate  in  such  plan  or
arrangement), unless cured within fifteen (15) days of Skeen
giving written notice thereof to the Company.
          
                     (c)  Skeen's relocation outside of  the
Washington  D.C./  Northern  Virginia  region  without   his
consent,  except  for required travel by  Skeen  on  Company
business;  provided, however, that if the Board of Directors
of   Company  determines  to  relocate  Company's  principal
executive   offices,  Company  shall  pay  all  of   Skeen's
reasonable moving and other relocation expenses,  the  Board
of  Directors shall make such adjustments in Skeen's  salary
as  it  reasonably deem necessary to reflect  the  increased
costs  of  living in the new location, and  Skeen  shall  be
obligated  to  perform his services generally  at  such  new
location  and  such  relocation shall not  constitute  "Good
Reason" hereunder.

                    (d)   Any material breach by Company  of
any  provisions  of this Agreement which  is  not  cured  by
Company  within  fifteen (15) days of Skeen  giving  written
notice thereof to the Company.

                    (e)  Except in the case of disability or
death,  any  purported termination of Skeen's employment  by
the  Company  which is not effected pursuant to  sixty  (60)
days' prior written notice of termination.

                     (f)   Any termination by Skeen  of  his
employment  with the Company which is effected as  a  result
of,   in  connection  with  or  within  twelve  (12)  months
following  a  "Change in Control" as defined and  determined
under Paragraph 8.C. of this Agreement.

          D.   Termination by Company.

                (i)   Without  Cause.  Company may,  without
cause, terminate Skeen's employment under this Agreement  at
any  time  by  giving Skeen sixty (60) days' written  notice
thereof,  and  such termination shall be  effective  on  the
sixtieth (60th) day following the date such notice is  given
(said  60th day, the "Termination Date").  Company shall  be
obligated  to  provide Skeen with Severance Compensation  as
provided  in  Paragraph  10.E. herein.   At  the  option  of
Company,  Skeen's employment shall be immediately terminated
upon  the  Company giving such notice, in which  case  Skeen
shall  continue to receive his full base salary and  related
fringe    benefits    through    the    Termination    Date.
Notwithstanding  any  provision of  this  Agreement  to  the
contrary,  any  termination  of Skeen's  employment  by  the
Company,  for  any  reason  or no reason,  within  one  year
following  a "Change in Control", as defined and  determined
under  Paragraph 8.C. of this Agreement, shall automatically
be deemed to be a termination without cause.

               (ii) For Cause. Company may terminate Skeen's
employment under this Agreement immediately for "cause."  In
such  event, Skeen will be entitled to payment of a pro-rata
bonus  amount to the date of termination of employment,  but
will  not  be entitled to Severance Compensation or  to  any
other  compensation, bonus or fringe benefits accrued  after
the  date  of  termination of employment.  The bonus  amount
payable  to Skeen will be calculated in the same fashion  as
in  the case of termination by Skeen without good reason, as
set  forth  in  Paragraph 10.C.(i) above.   Cause  shall  be
defined  as  any of the following: (i) willful  unauthorized
misconduct  in  the material performance of  Skeen's  duties
hereunder,  (ii)  commission of an act of  theft,  fraud  or
dishonesty  by  Skeen,  which act is materially  harmful  to
Company,  (iii)  material breach of any  provision  of  this
Agreement if such breach has not been cured by Skeen (or  if
Skeen  has  not compensated the Company for such  breach  by
payment of an amount deemed reasonable by the Company if the
breach  cannot be cured) within fifteen (15) days after  the
Company  gives  Skeen written notice of  such  breach.   Any
termination under this Paragraph 10.D.(ii) shall take effect
immediately  upon  the Company giving Skeen  written  notice
thereof.

          E.       Severance    Compensation.     "Severance
Compensation"  is  defined as all of  the  compensation  and
benefits  described  in this Paragraph  10.E.   It  will  be
provided  to Skeen upon the occurrence of any of the  events
described  elsewhere  in  this Agreement  as  providing  for
Skeen's  receipt of Severance Compensation, but not  in  any
other  circumstances  except to the extent  that  individual
components  of  Severance  Compensation  may  be  separately
provided   pursuant   to  the  terms  of   this   Agreement.
"Termination  Date" is defined as the last  day  of  Skeen's
employment with the Company.  "Severance Period" is  defined
as the period beginning on the day following the Termination
Date  and  ending on the day which is three years  following
the  Termination Date.  The compensation and benefits to  be
provided as Severance Compensation are as follows:

               (i)  Severance Pay.  Throughout the Severance
Period, Skeen will receive severance pay at the rate of 100%
of his annual base salary in effect at the time of his
termination, to be paid on the Company's regular payroll
payment dates at the same time and in the same fashion as
the Company's regular payroll payments.

               (ii) Bonus.  The Company shall pay to Skeen a
one-time bonus equal to three times the highest annual bonus
received by Skeen during any one of the five years
immediately preceding the year in which the Termination Date
occurs.  This bonus will be paid within thirty days
following the Termination Date.  It shall be considered to
be full compensation for all amounts due to Skeen for bonus
plans in which he was participating as of the Termination
Date, and he shall not be entitled to any further payments
under any of said plans during the Severance Period or
thereafter.  Notwithstanding the above, any bonus due to
Skeen for years (or other applicable bonus period) completed
prior to the Termination Date but not yet paid shall be paid
in addition to the bonus described herein.

               (iii)     Stock Options.  All options to
purchase shares of ACAH stock that have been granted to
Skeen shall become 100% vested as of the Termination Date.
All options that would have been granted to Skeen in the
future pursuant to Paragraph 8.A. hereof shall not be
granted if the date on which they would have been granted
occurs after the Termination Date, even though said date may
occur during the Severance Period.  Skeen (or, in the case
of death, his estate or his beneficiaries) shall have the
right to exercise such vested options until the earlier of
the original expiration date of said option, or a date
determined as follows:  (a) for options not intended to
qualify as Incentive Stock Options, Skeen shall have the
right to exercise vested options any time prior to the end
of the Severance Period; (b) for options intended to qualify
as Incentive Stock Options where termination is caused by
reasons other than his death or disability, Skeen shall have
the right to exercise within 90 days following termination
of his employment; (c) for options intended to qualify as
Incentive Stock Options where termination is caused by his
death or disability, Skeen (or his estate or his
beneficiaries) shall have the right to exercise within one
year following termination of his employment.

               (iv) Deferred Compensation.  The Deferred
Compensation program will continue throughout the Severance
Period, including Skeen's accumulation of Years of Service
for vesting purposes, and including the Company's
continuation of contributions.  The Split Dollar Agreement
shall continue in full force and effect through the
Severance Period and shall survive separate and apart from
this Agreement, and the Company's obligation to pay all
premiums pursuant to this Agreement shall continue in
accordance with the terms of the Split Dollar Agreement for
the Severance Period.  At the end of the Severance Period,
Skeen shall receive his vested interest and any obligation
to pay premiums shall be transferred to Skeen.
Alternatively, the Company may elect to pay such amounts to
Skeen as would be payable during the Severance Period by the
Company under the Deferred Compensation program in a single
lump sum payment within fifteen (15) days after the
Termination Date.

               (v)  Insurance Programs.  Coverage under the
Company's major medical, accident, health, dental,
disability and life insurance plans as from time to time
provided to other executive employees of the Company (and,
to the extent provided by such policies, to Skeen's
dependents) shall continue to be paid for by the Company
during the Severance Period, or, in the event of Skeen's
termination following a Change of Control of the Company as
defined in Paragraph 8.C., for the longer of the Severance
Period or the remainder of Skeen's life.  Provided, however,
if such coverage cannot be continued during the Severance
Period or until Skeen's death, as the case may be, under the
terms of such policies or plans, the Company shall reimburse
Skeen for the cost of comparable coverage under individually
obtained policies or for COBRA coverage, or shall make other
arrangements to assure that Skeen has comparable coverage.

               (vi) Vacation.  Vacation shall not continue
to accrue after the Termination Date under any
circumstances.

               (vii)     Executive Medical Reimbursement
Plan.  Throughout the Severance Period, the Company will
continue to promptly reimburse Skeen for any otherwise
unreimbursed premiums and/or uncovered medical expenses up
to $10,000 per calendar year under a written medical
reimbursement plan maintained for the Company's key
executive employees, including the tax gross-up, if
applicable.

               (viii)    Travel Benefits.  Skeen and his
wife shall be provided with free travel on the Company's
planes or on the planes of any successor in interest to the
Company on a positive space basis.  These travel benefits
will be provided throughout the Severance Period, or, in the
event of a Change of Control of the Company as defined in
Paragraph 8.C., for the longer of the Severance Period or
the remainder of Skeen's life.  Skeen shall not be entitled
to travel benefits on any other airline.

               (ix) Deductions for Taxes.  Any compensation
due to Skeen hereunder will be subject to deductions for
social security, federal and state withholding taxes, and
any other such taxes as may from time to time be required by
governmental authority.

               (x)  Notwithstanding any provision to the
contrary in this Agreement, if any part of the payments
provided for under or pursuant to this Agreement (the
"Agreement Payments"), together with all payments in the
nature of compensation to or for the benefit of Skeen under
any other arrangement, would if paid constitute a "parachute
payment" under Section 280G of the Internal Revenue Code of
1986, as amended (the "Code"), then the amount payable to
Skeen under or pursuant to this Agreement in such
circumstances shall be subject to the following sentence of
this Paragraph 10.E(x).  If (i) the value of the Agreement
Payments plus the value of all other payments to or for the
benefit of Skeen that constitute "parachute payments," minus
the amount of any excise taxes payable under Code
Section 4999 with respect to such payments and the amount of
any similar or comparable taxes payable only in connection
with a change in control, is greater than (ii) the greatest
value of payments in the nature of compensation contingent
upon a change in control that could be paid at such time to
or for the benefit of Skeen and not constitute a "parachute
payment" (the "Alternative Payment"), then the Agreement
Payments shall be payable to Skeen; otherwise, only the
Alternative Payment shall be payable to Skeen.

     11.   Assignment:  This Agreement, as it relates to the
employment  of Skeen, is a personal contract and the  rights
and   interests  of  Skeen  hereunder  may  not   be   sold,
transferred,  assigned,  pledged or hypothecated.   However,
this  Agreement shall inure to the benefit of and be binding
upon  Company  and  its  successors and  assigns  including,
without  limitation, any corporation or  other  entity  into
which   Company   is  merged  or  which  acquires   all   or
substantially all of the outstanding common stock or  assets
of  Company.   At  any  time prior to a Change  in  Control,
Company  may provide, without the prior written  consent  of
Skeen,  that  Skeen  shall  be  employed  pursuant  to  this
Agreement by any of its affiliates instead of or in addition
to  Company, and in such case all references herein  to  the
"Company"  shall  be  deemed to  include  any  such  entity,
provided  that (i) such action shall not relieve Company  of
its  obligation  to make or cause an affiliate  to  make  or
provide for any payment to or on behalf of Skeen pursuant to
this Agreement, and (ii) Skeen's duties and responsibilities
shall  not be significantly diminished as a result  thereof.
Unless  otherwise agreed to by Skeen, Company shall  provide
that  Skeen shall be employed pursuant to this Agreement  by
any  other entities to which ACAH or ACA may after the  date
of  this  Agreement transfer or assign any of the operations
or  businesses operated by either of them as of the date  of
this  Agreement, and in such case all references  herein  to
the  "Company" shall be deemed to include any such entities,
provided that such action shall not relieve Company  of  its
obligation to make or cause an affiliate to make or  provide
for  any  payment to or on behalf of Skeen pursuant to  this
Agreement.  The Board of Directors may assign any or all  of
its  responsibilities  hereunder to  any  committee  of  the
Board,  in  which case references to the Board of  Directors
shall be deemed to refer to such committee.

      12.  Invalid Provisions:  The invalidity of any one or
more of the paragraphs or provisions of this Agreement shall
not  affect  the reasonable enforceability of the  remaining
paragraphs or provisions of this Agreement, all of which are
inserted  herein conditionally upon being valid in law;  and
in  the  event  one or more of the paragraphs or  provisions
contained herein shall be invalid, this instrument shall  be
construed  as  if such invalid paragraphs or provisions  had
not  been  inserted  or, alternatively, said  paragraphs  or
provisions  shall be reasonably limited to the  extent  that
the  applicable  court interpreting the provisions  of  this
Agreement considered to be reasonable.

      13.   Specific Performance:  The parties hereby  agree
that  any violation by Skeen of the covenants and agreements
contained herein shall cause irreparable damage to  Company,
and  Company may, as a matter of course, enjoin and restrain
said violation by Skeen by process issued out of a court  of
competent  jurisdiction, in addition to any  other  remedies
that said court may see fit to award.

     14.   Binding Effect:  All the terms of this  Agreement
shall  be  binding  upon and inure to  the  benefit  of  the
parties  hereto  and their respective legal representatives,
successors and assigns.

     15.  Attorneys' Fees:  Company shall pay all legal fees
incurred by Skeen in connection with the preparation of this
Agreement promptly after submission of a bill therefor.   In
the event an action is taken by either party to enforce this
Agreement  or resolve a dispute in connection herewith,  the
prevailing  party  shall be entitled to  recover  the  costs
incurred  with the prosecution and defense of  such  action,
including reasonable attorney's fees.

       16.    Waiver  of  Breach  or  Violation  Not  Deemed
Continuing:  The waiver by either party of any provision  of
this Agreement shall not operate as, or be construed to  be,
a waiver of any subsequent breach hereof.

     17.   Entire Agreement; Law Governing:  This  Agreement
supersedes  in  its  entirety any and all  other  agreements
(specifically  including  any  earlier  versions   of   this
Severance Agreement), either oral or in writing, between the
parties hereto with respect to the subject matter hereof, by
and   between  Company  and  Skeen,  and  contains  all  the
covenants  and agreements among the parties with respect  to
such  subject matter.  This Agreement shall be construed  in
accordance  with the laws of the Commonwealth  of  Virginia.
Skeen hereby acknowledges that he was represented by counsel
of  his  choosing  in the drafting and negotiation  of  this
Agreement and that he reviewed this Agreement with  and  was
advised as to each of the terms thereof by such counsel.  In
interpreting this Agreement, a court shall not treat  either
party as the draftsman of the Agreement.

     18.    Paragraph  Headings:   The  Paragraph   headings
contained  in  this Agreement are for convenience  only  and
shall in no manner be construed as a part of this Agreement.
     
     19.   Release  by Skeen.  In the event of a termination
of  employment  by  Skeen that results  in  the  payment  of
Severance Compensation to him pursuant to the terms of  this
Agreement, in consideration for such Severance Compensation,
Skeen  hereby agrees to execute a full and complete  release
to the Company releasing any and all claims that he may have
against  the  Company including any claims relating  to  his
termination of employment.
     
     20.  Notices.  All notices permitted or required to  be
given  pursuant  to this Agreement shall be in  writing  and
shall be deemed to have been sufficiently given, subject  to
the  further provisions of this Section 20, for all purposes
when  presented personally to such party (which in the  case
of  notice to the Company, shall be presented to the  person
holding  the office or offices identified below) or sent  by
facsimile  transmission,  any  national  overnight  delivery
service,  or certified or registered mail, to such party  at
its address set forth below:

          If to Skeen, to the most recent address indicated
for Skeen's residence in the personnel records of Company,
unless Skeen gives written notice that such notices are to
be delivered to another address.

          If to ACA or the Company:

          Atlantic Coast Airlines Holdings, Inc.
          Atlantic Coast Airlines
          515A Shaw Road
          Dulles, VA  20166
          Attention:  General Counsel or Corporate Secretary
          Fax No. (703) 925-6294

Such notice shall be deemed to be given and received when
delivered if delivered personally, upon electronic or other
confirmation of receipt if delivered by facsimile
transmission, the next business day after the date sent if
sent by a national overnight delivery service, or five (5)
business days after the date mailed if mailed in the
continental United States by certified or registered mail.
Any notice of any change in such address shall also be given
in the manner set forth above.  Whenever the giving of
notice is required, the giving of such notice may be waived
in writing by the party entitled to receive such notice.

A copy of any notice given to Skeen shall be sent to:

          Robert E. Madden
          Carr Goodson Lee & Warner
          1301 K Street, NW
          Suite 400, East Tower
          Washington, DC  20005-3300
          Fax No. (202) 310-5555
      IN  WITNESS  WHEREOF, the Company has hereunto  caused
this  Agreement to be executed by a duly authorized  officer
and  Skeen has hereunto set his hand as of the day and  year
first above written.

WITNESS:



________________________________
_____________________________
                                   Kerry B. Skeen

                                   COMPANY:
                                   
ATTEST:                            ATLANTIC COAST AIRLINES



_______________________________                          BY:
_________________________
Richard J. Kennedy,                C. Edward Acker,
Secretary                                Chairman   of   the
Board

                                   
ATTEST:                                 ATLANTIC COAST
                                   AIRLINES HOLDINGS, INC.



_______________________________                          BY:
_________________________
Richard J. Kennedy,                C. Edward Acker,
Secretary                          Chairman of the Board