<PAGE>
                                                                   EXHIBIT 10.47


                   LOAN AGREEMENT ($20,000,000.00 Term Loan)
                   -----------------------------------------

      THIS is an agreement (the "Agreement") made this 8th day of September,
 2000, by FIRST HAWAIIAN BANK, a Hawaii corporation, as lender, and ALOHA
 AIRGROUP, INC., a Hawaii corporation, as borrower.

 RECITALS:
 --------

      1. Aloha Airgroup, Inc., a Hawaii corporation, and BancWest Corporation,
 a Delaware corporation ("BWE"), along with other individuals and entities,
 entered into that certain Purchase Agreement dated September 8, 2000 (the
 "Purchase Agreement") relating to the sale and purchase of certain Series C 10%
 Senior Exchangeable Preferred Stock issued by Aloha Airgroup, Inc. BWE
 purchased 20,000 shares of such stock (the "BWE Preferred Shares") in
 accordance with the Purchase Agreement.

      2. Pursuant to the terms of the Purchase Agreement, Aloha Airgroup, Inc.,
 has elected to exchange the BWE Preferred Shares into Senior Secured Guaranteed
 Floating Rate Notes. Such notes shall be represented by one (1) promissory note
 in favor of BWE, in the principal amount of $20,000,000.00, a true and correct
 copy of which is attached to this Agreement as Exhibit "1" and made a part
 hereof (the "Note").

      3. BWE has negotiated with First Hawaiian Bank, a Hawaii corporation, to
 sell and assign the Note to First Hawaiian Bank.

      4. First Hawaiian Bank has agreed to purchase and accept an assignment of
 the Note from BWE, upon the satisfaction of certain conditions, including,
 without limitation, the execution and delivery of this Agreement by Aloha
 Airgroup, Inc.

      5. Aloha Airgroup, Inc., deems it to be to its own financial benefit that
 First Hawaiian Bank purchase and accept an assignment of the Note.

      NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
 forth, and intending to be legally bound thereby, Aloha Airgroup, Inc., and
 First Hawaiian Bank hereby agree as follows:

 AGREEMENT:
 ---------

 SECTION 1. DEFINITIONS.

      As used in this Agreement, each of the following terms shall have the
 meaning set forth below with respect thereto:

      "AGENCY FEE" means a fee payable annually by the Borrower to the Lender,
 as provided in the side letter agreement referred to in Section 5.5 of this
 Agreement.

      "BORROWER" means Aloha Airgroup, Inc., a Hawaii corporation.


<PAGE>

      "CAPITAL LEASE" means any lease of any property (whether real, personal or
 mixed) which, in conformity with GAAP, is or should be accounted for as a
 Capital Lease on a balance sheet.

      "CASH FLOW" means, with respect to the Consolidated Group, the sum of (a)
 the net income of the Consolidated Group (excluding non-recurring gains and
 losses), PLUS (b) the sum of the following, to the extent deducted in
 determining net income: (i) depreciation and amortization allowances, (ii)
 interest expense (including imputed interest on Capital Leases), (iii) deferred
 taxes and (iv) rent expenses, and LESS (c) the change in the excess of non-cash
 current assets over current liabilities (other than those pertaining to the
 current portion of long term debt and accrued interest and taxes) calculated on
 a rolling four quarters basis and computed at the end of each Quarter.

      "CLOSING DATE" means the date on which the Lender determines that all of
 the conditions set forth in Section 4 of this Agreement have been satisfied.

      "CONSOLIDATED GROUP" means Aloha Airgroup, Inc., and the Subsidiaries.

      "DEBT TO WORTH RATIO" means, with respect to the Consolidated Group,
 Total Liabilities divided by Tangible Net Worth.

      "DEBT SERVICE" means the sum of regularly scheduled principal payments,
 interest payments, payments under Capital Leases, dividends declared and
 payable (if permitted under the provisions of this Agreement), and rent expense
 payments made by the Borrower, calculated on a rolling four quarters basis and
 computed at the end of each Quarter.

      "EVENT OF DEFAULT" means any of the events described in Section 6.1 of
 this Agreement.

      "FACILITY FEE" means a fee payable annually by the Borrower to the Lender,
 as provided in the side letter agreement referred to in Section 5.6 of this
 Agreement.

      "FIXED CHARGE COVERAGE RATIO" means, with respect to the Consolidated
 Group, Cash Flow divided by Debt Service.

      "GAAP" means generally accepted accounting principles.

      "GUARANTOR" means Aloha Airlines, Inc., a Delaware corporation.

      "GUARANTY" means that certain Guaranty dated the date of this Agreement,
 executed by the Guarantor in favor of the Lender, guaranteeing the due and
 punctual payment of the Note, and the observance and performance by the
 Borrower of all of the Borrower's obligations under the Loan Documents.

      "LENDER" means First Hawaiian Bank, a Hawaii corporation.

      "LIMITED GUARANTOR" means, individually and collectively, (a) Aloha
 Securities & Investment Company, a Hawaii limited partnership, and (b) Sheridan
 Ing Partners Hawaii, a Hawaii limited partnership.


                                 2
<PAGE>

      "LIMITED GUARANTY" means individually and collectively, (a) that certain
 Limited Guaranty dated the date of this Agreement, executed by Aloha Securities
 & Investment Company, in favor of the Lender, guaranteeing the due and punctual
 payment of $7,500,000.00 of the Note, upon the terms and conditions more
 particularly set forth therein; and (b) that certain Limited Guaranty dated the
 date of this Agreement, executed by Sheridan Ing Partners Hawaii, guaranteeing
 the due and punctual payment of $2,500,000.00 of the Note, upon the terms and
 conditions more particularly set forth therein.

      "LINE OF CREDIT AGREEMENT" means that certain Amended and Restated Loan
 Agreement -1996, dated December 31, 1996, executed by and between Aloha
 Airlines, Inc., as borrower, and First Hawaiian Bank and other lenders, as
 lenders, as the same has been or may hereafter be amended.

      "LOAN" means the indebtedness owed by the Borrower to the Lender in the
 principal amount of TWENTY MILLION AND NO/100 DOLLARS ($20,000,000.00),
 together with interest thereon, as evidenced by and as set forth in the Note.

      "LOAN DOCUMENTS" means all of the documents and instruments executed by or
 for the benefit of the Borrower in connection with the Loan, including, without
 limitation, this Agreement, the Note, the Guaranty, the Limited Guaranty, the
 Stock Pledge, and the Security Agreement; provided, however, that the
 Participation Rights Agreement is not included within the definition of Loan
 Documents.

      "LOAN FEE" means a fee in the principal amount of $150,000.00, payable by
 the Borrower to the Lender, on or before the Closing Date, as provided in
 Section 5.7 of this Agreement.

      "MATURITY DATE" means (a) September 8, 2008, or (b) the date, following
 the occurrence of an Event of Default, on which the Lender notifies the
 Borrower that the entire principal balance of the Loan, together with all
 accrued interest thereon, and all fees, charges, expenses and other sums
 payable under this Agreement and the other Loan Documents, shall become due and
 payable.

      "NOTE" means the Promissory Note dated September 8, 2000, executed by the
 Borrower in favor of BWE, evidencing the Borrower's agreement to repay the
 principal balance of the Loan, together with interest thereon, as provided
 therein. At the Closing Date, the Note will be assigned by BWE to First
 Hawaiian Bank.

      "PARTICIPANT" means another lender or lenders that has or have agreed to
 purchase a participating interest in the Loan and the Loan Documents from the
 Lender.

      "PARTICIPATION RIGHTS AGREEMENT" means that certain Participation Rights
 Agreement dated the date of this Agreement, executed by First Hawaiian Bank and
 Aloha Airgroup, Inc.

      "PARTICIPATION RIGHTS" means those certain participation rights in favor
 of BWE and/or First Hawaiian Bank more particularly described in the
 Participation Rights Agreement.


                                 3
<PAGE>

      "PREFERRED SHARES" means the Series C 10% Senior Exchangeable Preferred
 Stock issued by the Borrower pursuant to the Purchase Agreement.

      "PURCHASE AGREEMENT" means the Purchase Agreement described in Recital 1
 above, as the same may be amended, supplemented or otherwise modified from time
 to time.

      "QUARTER" means any one of the following three-calendar-month periods in
 any calendar year: April 1 to and including June 30; July 1 to and including
 September 30; October 1 to and including December 31; and January 1 to and
 including March 31.

      "SECURITY AGREEMENT" means that certain security agreement executed
 concurrently herewith by and between Aloha Airlines, Inc., and the Lender,
 which shall effect an assignment to the Lender of, and grant to the Lender a
 valid and subsisting first security interest in and to the items of collateral
 described therein.

      "SERIES B  PREFERRED  STOCK"  means the  Series B  Cumulative
 Convertible Participating Preferred Stock issued by the Borrower.

      "STOCK PLEDGE" means that certain Stock Pledge and Security Agreement
 dated the date of this Agreement, executed by the Borrower and the Lender,
 pledging to the Lender the Borrower's stock in Aloha Airlines, Inc.

      "STRUCTURING FEE" means a fee in the principal amount of $150,000.00,
 payable by the Borrower to the Lender, on or before the Closing Date, as
 provided in Section 5.8 of this Agreement.

      "SUBSIDIARIES" means Aloha Airlines, Inc., a Delaware corporation, Aloha
 IslandAir, Inc., a Delaware corporation, and any other corporations or limited
 liability companies which are wholly owned by the Borrower or by a Subsidiary
 of the Borrower.

      "TANGIBLE  NET WORTH" means the excess of Total Assets of the
 Consolidated Group over Total Liabilities of the Consolidated Group, as
 determined in accordance with GAAP.

      "TOTAL ASSETS" means all items of property owned by the Consolidated Group
 which, in accordance with GAAP, would be included as an asset on the balance
 sheet as of the date to which assets are to be determined, EXCLUDING, HOWEVER,
 (a) all assets which would be classified as intangible assets under GAAP, such
 as, goodwill (whether representing the excess of cost over book value of assets
 acquired or otherwise), patents, trademarks, trade names, copyrights,
 franchises, and deferred charges (including, without limitation, organization
 costs, and research and development costs), (b) treasury stock and minority
 interests in subsidiaries, (c) cash set apart and held in a sinking or other
 analogous fund established for the purpose of redemption or other retirement of
 capital stock, (d) to the extent not already deducted from total assets,
 reserves for depreciation, depletion, obsolescence or amortization of
 properties and all other reserves or appropriations of retained earnings which,
 in accordance with GAAP, should be established in connection with the business
 conducted by the relevant corporation, and (e) any evaluation or other write-up
 in book value of assets subsequent to December 31, 2000.


                                 4
<PAGE>

      "TOTAL LIABILITIES" means the principal amount of all items of
 indebtedness and other obligations of the Consolidated Group which, in
 accordance with GAAP, would be included as a liability on the balance sheet as
 of the date to which liabilities are to be determined, including, without
 limitation, (1) indebtedness for borrowed money or for the deferred purchase
 price of property or services, (ii) obligations as lessee under leases which
 shall have been or should be, in accordance with GAAP, recorded as Capital
 Leases, (iii) reserves for loan losses and (iv) obligations under direct or
 indirect guarantees (except for letters of credit securing workers'
 compensation insurance and leases, completion bonds and guaranties, insurance
 bonds, customs bonds, litigation bonds, bonds issued in favor of airline
 clearinghouses (such as ARC), improvement bonds, and warranty and maintenance
 bonds required in the ordinary course of business) and obligations (contingent
 or otherwise) to purchase or otherwise acquire, or otherwise assure a creditor
 against loss in respect of, indebtedness or obligations of others (other than
 the Series B Preferred Stock and the Preferred Shares, to the extent the same
 may be deemed to constitute a liability of the Borrower).

 SECTION 2. THE LOAN.

      2.1  AMOUNT. Effective as of the Closing Date, the Borrower acknowledges
 that it is indebted to the Lender in the principal amount of TWENTY MILLION AND
 NO/100 DOLLARS ($20,000,000.00), as evidenced by the Note. The Borrower hereby
 consents to the assignment of the Note by BWE to the Lender.

      2.2  INTEREST. Interest on the principal balance of the Loan shall accrue
 as provided in the Note.

      2.3  PAYMENTS. The Borrower shall pay to the Lender interest only during
 the first three (3) years of the Loan, and principal and interest during the
 last five (5) years of the Loan, all as provided in the Note. The Borrower
 shall repay the unpaid principal balance of the Loan, all accrued but unpaid
 interest thereon, and all fees, charges and other sums payable under the Loan
 Documents, to the Lender on the Maturity Date. The Borrower may prepay
 principal on the terms and conditions set forth in the Note. No amount of
 principal, once repaid or prepaid, may be reborrowed.

      2.4  SECURITY. The Borrower will deliver, or cause to be delivered, to
 the Lender on or before the Closing Date, among other items which may be
 reasonably required by the Lender:

           (a) the Security Agreement, together with a Uniform Commercial Code
           Financing Statement perfecting the security interest granted to the
           Lender in the Security Agreement; and

           (b) the Stock Pledge.

      2.5  GUARANTY; LIMITED GUARANTY. The Borrower will deliver, or cause to
 be delivered, to the Lender on or before the Closing Date, the Guaranty, duly
 executed by the Guarantor, and each Limited Guaranty, duly executed by each of
 the Limited Guarantors.


                                  5
<PAGE>

      2.6  CLOSING. Closing of the Loan shall be subject to the satisfaction of
 all of the conditions precedent set forth in Section 4 of this Agreement.

 SECTION 3. REPRESENTATIONS AND WARRANTIES BY THE BORROWER. The Borrower
 represents and warrants to the Lender that:

      3.1  ORGANIZATION, STANDING AND AUTHORITY OF BORROWER. The Borrower is a
 Hawaii corporation, duly registered, validly existing and in good standing
 under the laws of the State of Hawaii, and has all requisite power and
 authority to carry on the business and to own the property that it now carries
 on and owns. The Borrower has all requisite power and authority to execute and
 deliver the Loan Documents and to observe and perform all of the provisions and
 conditions thereof. The execution and delivery of the Loan Documents have been
 duly authorized by the Board of Directors of the Borrower and, to the extent
 required by law, by the stockholders of the Borrower, and no other corporate
 action of the Borrower is requisite to the execution and delivery of the Loan
 Documents.

      3.2  ORGANIZATION, STANDING AND AUTHORITY OF SUBSIDIARIES.

      (a) Aloha Airlines, Inc., is a Delaware corporation, duly registered,
 validly existing and in good standing under the laws of the State of Delaware,
 is authorized to do business in the State of Hawaii, and has all requisite
 power and authority to carry on the business and to own the property that it
 now carries on and owns. Aloha Airlines, Inc., has all requisite power and
 authority to execute and deliver the Guaranty and to observe and perform all of
 the provisions and conditions thereof. The execution and delivery of the
 Guaranty have been duly authorized by the Board of Directors of Aloha Airlines,
 Inc., and, to the extent required by law, by the stockholders of Aloha
 Airlines, Inc., and no other corporate action of Aloha Airlines, Inc., is
 requisite to the execution and delivery of the Guaranty.

      (b) Aloha IslandAir, Inc., is a Delaware corporation, duly registered,
 validly existing and in good standing under the laws of the State of Delaware,
 is authorized to do business in the State of Hawaii, and has all requisite
 power and authority to carry on the business and to own the property that it
 now carries on and owns.

      3.3  TAX RETURNS AND PAYMENTS. All tax returns and reports of the Borrower
 and the Subsidiaries required by law to be filed have been duly filed, and all
 taxes, assessments, contributions, fees and other governmental charges (other
 than those presently payable without penalty or interest and those which have
 been disclosed to the Lender but which are currently being contested in good
 faith) upon the Borrower or the Subsidiaries, or upon its or their properties
 or assets or income, which are due and payable, have been paid.

      3.4  LITIGATION. There is, to the knowledge of the Borrower, no action,
 suit, proceeding or investigation pending at law or in equity or before any
 federal, state, territorial, municipal or other governmental department,
 commission, board, bureau, agency or instrumentality or threatened against or
 affecting the Borrower or the Subsidiaries (including the Guarantor), which
 might materially adversely affect the Borrower's ability to perform its
 obligations under the Loan Documents or the Guarantor's ability to perform its
 obligations under the Guaranty.


                                 6
<PAGE>

      3.5  BORROWER'S COMPLIANCE WITH OTHER INSTRUMENTS, NONE BURDENSOME. The
 Borrower is not in violation of or in default with respect to any term or
 provision of its Articles of Incorporation or Bylaws or any material mortgage,
 indenture, contract, agreement or instrument applicable to the Borrower or by
 which it may be bound; and the execution, delivery, performance of and
 compliance with each and all of the Loan Documents will not result in any such
 violation or be in conflict with or constitute a default under any such term or
 provision or result in the creation of any mortgage, lien or charge on any of
 the properties or assets of the Borrower not contemplated by this Agreement;
 and there is no term or provision of its Articles of Incorporation or Bylaws,
 or any mortgage, indenture, contract, agreement or instrument applicable to the
 Borrower or by which it may be bound, which may materially adversely affect the
 business or prospects or condition (financial or other) of the Borrower or of
 any of its properties or assets.

      3.6  GUARANTOR'S COMPLIANCE WITH OTHER INSTRUMENTS, NONE BURDENSOME. The
 Guarantor is not in violation of or in default with respect to any term or
 provision of its Certificate of Incorporation or Bylaws or any material
 mortgage, indenture, contract, agreement or instrument applicable to the
 Guarantor or by which it may be bound; and the execution, delivery, performance
 of and compliance with the Guaranty will not result in any such violation or be
 in conflict with or constitute a default under any such term or provision or
 result in the creation of any mortgage, lien or charge on any of the properties
 or assets of the Guarantor not contemplated by this Agreement; and there is no
 term or provision of its Certificate of Incorporation or Bylaws, or any
 mortgage, indenture, contract, agreement or instrument applicable to the
 Guarantor or by which it may be bound, which may materially adversely affect
 the business or prospects or condition (financial or other) of the Guarantor or
 of any of its properties or assets.

      3.7  COMPLIANCE WITH LAW. To the best of the Borrower's knowledge, the
 consummation of the transactions contemplated by the Loan Documents will not
 conflict with or result in a breach of any law, statute, ordinance, regulation,
 order, writ, injunction, or judgment of any court or governmental
 instrumentality, domestic or foreign.

      3.8  GOVERNMENTAL AUTHORIZATION. No consent, approval or authorization of,
 or registration, declaration or filing with, any governmental or public body or
 authority in connection with the valid execution and delivery of each of the
 Loan Documents (including the Limited Guaranty or the Guaranty) is required or,
 if required, such consent, approval, order or authorization shall have been
 obtained prior to the Closing Date.

      3.9  FINANCIAL STATEMENTS. All financial statements heretofore delivered
 to the Lender by the Borrower or the Subsidiaries are true and correct in all
 respects, and fairly represent the financial condition of the Borrower and the
 Subsidiaries as of the dates thereof; and no material, adverse changes have
 occurred in the financial condition reflected therein since the respective
 dates thereof to the Closing Date.

      3.10 BROKERS, FINDERS AND AGENTS. The Borrower has not employed or engaged
 any broker, finder or agent who may claim a commission or fee or other
 compensation with respect to the Loan. The Borrower will indemnify and hold the
 Lender harmless from any and all claims of brokers or other claims for
 commissions or fees in connection with the Loan and will further hold the
 Lender harmless and indemnify the Lender against all losses, damages, costs and
 charges (including


                                 7
<PAGE>

 attorneys' fees) which the Lender may sustain because of such claims or in
 consequence of defending against such claims.

      3.11 CHARACTER OF REPRESENTATIONS AND WARRANTIES. None of the financial
 statements or any certificate or statement furnished to the Lender by or on
 behalf of the Borrower or the Subsidiaries in connection with the Loan, and
 none of the representations and warranties in this Agreement, contains any
 untrue statement of a material fact or omits to state a material fact necessary
 in order to make the statements contained therein or herein not misleading. To
 the best knowledge of the Borrower, there is no fact which materially adversely
 affects or in the future (so far as the Borrower can now foresee) may
 materially adversely affect the ability of the Borrower to observe or perform
 its obligations under the Loan Documents, or of the Guarantor to observe or
 perform its obligations under the Guaranty, which has not been set forth herein
 or in a certificate or opinion of counsel or other written statement furnished
 to the Lender by or on behalf of the Borrower or the Guarantor.

 SECTION 4. CONDITIONS TO CLOSING.

      The Lender's agreement to purchase and accept an assignment of the Note is
 subject to the fulfillment, to its satisfaction, of the following conditions:

      4.1  REPRESENTATIONS AND WARRANTIES TRUE AT CLOSING. The representations
 and warranties contained in Section 3 of this Agreement and otherwise made by
 or on behalf of the Borrower or the Subsidiaries (including the Guarantor) in
 connection with the Loan, shall be true and correct as of the Closing Date,
 with the same effect as if made at such time.

      4.2  EXECUTION OF LOAN DOCUMENTS; EXECUTION OF PARTICIPATION RIGHTS
 AGREEMENT. The Borrower shall have delivered to the Lender and the Lender shall
 have approved, (a) all of the Loan Documents, duly executed by the appropriate
 parties, and (b) the Participation Rights Agreement, duly executed by the
 Borrower.

      4.3  EXPENSES. The Borrower shall have paid to the Lender on the Closing
 Date all of the fees and expenses provided for in Section 5.4 which are due and
 payable as of the Closing Date.

      4.4  FEES. The Borrower shall have paid to the Lender on the Closing Date
 the amounts of the Agency Fee, the Facility Fee, the Loan Fee and the
 Structuring Fee, provided for in Sections 5.5, 5.6, 5.7 and 5.8, of this
 Agreement, respectively, which are due and payable as of the Closing Date.

      4.5  NO EVENT OF DEFAULT. There shall exist at the Closing Date, no
 condition or event which would constitute an Event of Default or which, after
 notice or lapse of time, or both, would constitute an Event of Default.

      4.6  INSOLVENCY, BANKRUPTCY, ETC. Neither the Borrower, the Limited
 Guarantor nor the Guarantor shall have become insolvent; or made an assignment
 for the benefit of creditors; or failed generally to pay its debts as they
 become due; or become the subject of an order for relief in an involuntary case
 under the bankruptcy laws as now or hereafter constituted, and such order shall
 remain in effect and unstayed for a period of sixty (60) consecutive days; or
 commenced a voluntary


                                 8
<PAGE>

 case under the bankruptcy laws as now or hereafter constituted; or filed any
 petition or answer seeking for itself any arrangement, composition, adjustment,
 liquidation, dissolution or similar relief to which it may be entitled under
 any present or future statute, law or regulation; or filed any answer admitting
 the material allegations of any petition filed against it in any such
 proceedings; or sought or consented to or acquiesced in the appointment of, or
 taking possession by, any custodian, trustee, receiver or liquidator of it or
 of all or a substantial part of its properties or assets; or taken any action
 looking to its dissolution or liquidation; or within sixty (60) days after
 commencement of any proceedings against it seeking any arrangement,
 composition, adjustment, liquidation, dissolution or similar relief to which it
 may be entitled under any present or future statute, law or regulation, such
 proceeding shall not have been dismissed; or within sixty (60) days after the
 appointment of, or taking possession by, any custodian, trustee, receiver or
 liquidator of any or of all or a substantial part of its properties or assets,
 without its consent or acquiescence, any such appointment or possession shall
 not have been vacated or terminated.

      4.7  OPINION OF COUNSEL. The Borrower shall have delivered to the Lender
 and the Lender shall have approved, an opinion of legal counsel for the
 Borrower, the Limited Guarantor and the Guaranty, in substantially the form set
 forth in Exhibit "2" attached hereto and made a part hereof.

      4.8  CURRENT FINANCIAL STATEMENTS. The Borrower, the Limited Guarantor and
 the Guarantor shall have delivered current financial statements satisfactory to
 the Lender, showing that no adverse changes have occurred in their respective
 financial conditions since the date of the financial statements previously
 delivered to the Lender.

      4.9  PRO FORMA PROJECTIONS. The Borrower shall have provided to the
 Lender, and the Lender shall have approved, (a) an eight (8) year projection of
 operations, statement of cash flow and balance sheet for the Consolidated
 Group; and (b) an eight (8) year fleet schedule for Aloha Airlines, Inc., and
 Aloha IslandAir, Inc., containing the Borrower's best estimate of aircraft
 replacement and expansion for such air carriers.

      4.10 CONDITIONS ARE SOLELY FOR BENEFIT OF THE LENDER. All conditions set
 forth in this Section 4 are imposed solely and exclusively for the benefit of
 the Lender, its successors and assigns, and no other person shall have standing
 to require satisfaction of such conditions in accordance with their terms, and
 no other person shall, under any circumstances, be deemed to be the beneficiary
 of such conditions, any or all of which may be freely waived, in whole or in
 part, by the Lender at any time if, in its sole judgment, the Lender deems it
 advisable to do so.

 SECTION 5. OTHER COVENANTS OF THE BORROWER.

      The Borrower covenants and agrees with the Lender as follows:

      5.1  INFORMATION. The Borrower shall (a) furnish directly to the Lender
 with reasonable promptness such data and information, financial or otherwise,
 concerning the Borrower and/or its Subsidiaries as from time to time may
 reasonably be requested by the Lender, including, but not limited to, any
 filings made with the Securities and Exchange Commission; (b) promptly notify
 the Lender of any condition or event which constitutes a breach or event of
 default of any covenant, condition, warranty, representation or provision of
 any of the Loan Documents, and of any materially


                                 9
<PAGE>

 adverse change in the financial condition or operations of the Borrower or the
 Guarantor; and (c) furnish directly to the Lender not more than sixty (60) days
 after the end of each Quarter a "compliance certificate", signed by an
 authorized executive officer of the Borrower, to the effect that the signer has
 reviewed the relevant terms of this Agreement, and the other Loan Documents,
 and has made, or caused to be made under his or her supervision, a review of
 the transactions and condition of the Borrower and its Subsidiaries during such
 Quarter, and that such review has not disclosed the occurrence during such
 period, and that the signer does not have knowledge of the existence as at the
 date of such certificate, of any Event of Default, or, if any Event of Default
 has occurred or exists, specifying the nature and period of existence thereof
 and what action the Borrower has taken or is taking or proposes to take with
 respect thereto.

      5.2  PAYMENT OF TAXES. The Borrower shall pay or cause to be paid all
 taxes, assessments, and other governmental charges levied upon any of its
 properties or assets, or in respect of its income, before the same become
 delinquent, except that the Borrower will have the right to contest assessments
 and other charges in the manner provided in Section 6.2.

      5.3  INDEMNIFICATION OF THE LENDER. The Borrower shall indemnify and hold
 the Lender harmless from any and all claims asserted against the Lender by any
 person, entity or governmental authority arising out of or in connection with
 the Loan except for claims arising out of the Lender's gross negligence or
 wilful misconduct. The Lender shall be entitled to appear in any action or
 proceeding to defend itself against such claims, and all reasonable costs
 incurred by the Lender in connection therewith, including reasonable attorneys'
 fees, shall be reimbursed by the Borrower to the Lender within ten (10) days
 after presentment, as provided in Section 5.4. Any failure to so reimburse the
 Lender within the specified time period shall constitute an Event of Default
 under this Agreement, and the unreimbursed amount shall bear interest at the
 default rate specified in the Note.

      The Lender shall, at its sole option, be entitled to settle or compromise
 any asserted claim against it, and such settlement shall be binding upon the
 Borrower for purposes of this indemnification. Payment thereof by the Lender,
 or the payment by the Lender of any judgment or claim successfully perfected
 against the Lender, shall bear interest at the default rate specified in the
 Note until paid, and shall be payable upon demand of the Lender. The agreements
 contained in this section shall survive repayment of the Loan and termination
 of this Agreement.

      5.4  EXPENSES. Whether or not the transactions hereby contemplated shall
 be consummated, the Borrower shall assume and pay upon demand of the Lender:

           (a) All reasonable out-of-pocket expenses incurred by the Lender in
 connection with the making and continued administration of any portion of the
 Loan, including, but not limited to, the reasonable fees and disbursements and
 expenses of legal counsel for the Lender;

           (b) Any and all advances or payments made by the Lender pursuant to
 this Agreement or any of the other Loan Documents, and other similar or
 dissimilar reasonable expenses and charges in connection with the
 administration, servicing or collection of any portion of the Loan including
 restructuring of the Loan, all of which shall constitute an additional
 liability owing by the Borrower to the Lender; and


                                 10
<PAGE>

           (c) All costs and expenses, including, but not limited to, reasonable
 attorneys' fees, incurred by the Lender as a result of an Event of Default or
 for the purpose of negotiating a resolution of any default (whether by means of
 refinancing or otherwise and whether or not successful) or for the purpose of
 effecting collection of the amounts outstanding under the Loan, principal,
 interest, fees and charges, or any other sums required to be paid by the
 Borrower pursuant to any of the Loan Documents, when the same shall become due
 and payable (whether at the stated maturity thereof or upon any acceleration of
 the maturity thereof).

      5.5  AGENCY FEE. The Borrower shall pay the Agency Fee to the Lender in
 accordance with the terms of that certain side letter agreement executed
 concurrently herewith by and between the Borrower and the Lender.

      5.6  FACILITY FEE. The Borrower shall pay the Facility Fee to the Lender
 in accordance with the terms of that certain side letter agreement executed
 concurrently herewith by and between the Borrower and the Lender.

      5.7  LOAN FEE. The Borrower shall pay the entire Loan Fee ($150,000.00) to
 the Lender on or before the Closing Date.

      5.8  STRUCTURING FEE. The Borrower shall pay the entire Structuring Fee
 ($150,000.00) to the Lender on or before the Closing Date.

      5.9  MINIMUM CONSOLIDATED TANGIBLE NET WORTH. The Consolidated Group shall
 at all times maintain a Tangible Net Worth of not less than $22,772,000.00,
 plus (i) 50% of the cumulative annual consolidated net profit (before
 dividends) of the Consolidated Group, beginning with the year ended December
 31, 2000, without deduction for any annual loss, and (ii) 75% of the amount
 received from any infusion of new equity or issuance of new capital stock.

      5.10 MINIMUM FIXED CHARGE COVERAGE RATIO.  The Consolidated Group shall at
 all times maintain a minimum Fixed Charge Coverage Ratio of not less than
 1.30 to 1.

      5.11 MAXIMUM DEBT TO WORTH RATIO. The Consolidated Group shall at all
 times maintain a Debt to Worth Ratio which shall not exceed 5.00 to 1.

      5.12 FINANCIAL STATEMENTS. The Borrower shall furnish to the Lender the
 following:

           (a) as soon as available, but not later than sixty (60) days after
 the end of each Quarter, company-prepared quarterly consolidated financial
 statements of the Consolidated Group for such Quarter, prepared in accordance
 with GAAP, and the compliance certificate referred to in Section 5.1(c) of
 this Agreement, together with a calculation of the Tangible Net Worth, the
 Fixed Charges Coverage Ratio and the Debt to Worth Ratio for the Consolidated
 Group, for such Quarter.

           (b) as soon as available, but not later than one hundred twenty (120)
 days after the end of each fiscal year of the Borrower, (i) consolidated
 audited financial statements of the Borrower, for such fiscal year, prepared in
 accordance with GAAP, and accompanied by the opinion of independent certified
 public accountants of recognized standing, containing no qualifications, or


                                       11
<PAGE>

 only such qualification as are reasonably acceptable to the Lender, and (ii)
 internal, companyprepared consolidating financial statements of the Borrower,
 including the operations of the Subsidiaries.

           (c) as soon as available, but not later than sixty (60) days after
 the end of each Quarter, an aging report of accounts receivable for each member
 of the Consolidated Group.

           (d) as soon as available, but not later than March 1 of each calendar
 year, the projected consolidated financial statements of the Borrower for such
 calendar year.

      5.13 INSURANCE. The Borrower shall maintain and shall cause its
 Subsidiaries to maintain at all times during the term of the Loan such
 insurance as is normally carried by prudent air carriers engaged in the same or
 similar business as the Borrower, and its Subsidiaries.

      5.14 RESTRICTION ON PAYMENTS TO SHAREHOLDERS. Neither the Borrower nor its
 Subsidiaries shall declare, pay or make any dividend or distribution (in cash,
 property or obligations) on any shares of any class of capital stock (now or
 hereafter outstanding) of the Borrower or its Subsidiaries, or apply any of its
 funds, property or assets to the purchase, redemption, sinking fund or other
 retirement of, or agree to purchase or redeem any shares of any class of
 capital stock (now or hereafter outstanding) of the Borrower or its
 Subsidiaries, or any warrants, options or other rights with respect to any
 shares of any class of capital stock (now or hereafter outstanding) of the
 Borrower or its Subsidiaries, provided, however, that nothing in this Section
 5.14 shall prohibit or restrict the Borrower's ability to perform its
 obligations under Section 7.9 of the Purchase Agreement.

      5.15. NEGATIVE COVENANTS. The Borrower shall not incur or suffer to be
 created or incurred or to exist, and shall not permit the Guarantor to incur or
 suffer to be created or incurred or to exist, any encumbrance, mortgage,
 security interest, pledge, lien or charge of any kind upon any of its property
 or assets of any character, whether now owned or hereafter acquired, or
 transfer any of such property or assets for the purpose of subjecting the same
 to the payment of any indebtedness or performance of any other obligation, or
 acquire or have an option to acquire any property or assets upon conditional
 sale or other title retention agreement, device or arrangement; PROVIDED,
 HOWEVER, that the Borrower and/or the Guarantor may create or incur or suffer
 to be created or incurred or to exist: (a) any existing encumbrance, mortgage,
 security interest, pledge, lien or charge; (b) any new encumbrance, mortgage,
 security interest, pledge, lien or charge which arises out of any refinancing,
 extension, renewal or refunding of any existing indebtedness, provided that
 such indebtedness is not increased and such indebtedness is not secured by any
 additional assets; (c) any purchase money encumbrance, mortgage, security
 interest, pledge, lien or charge which arises out of financing for the purchase
 of a new asset, provided that such indebtedness is not secured by any
 additional assets; (d) liens for taxes, assessments, governmental charges or
 claims, statutory liens arising in the ordinary course of business, liens
 incurred or deposits made in connection with workers' compensation,
 unemployment insurance, and other types of social security, liens incurred or
 deposits made to secure the performance of tenders, bids, leases, statutory or
 regulatory obligations, bankers' acceptances, surety and appeal bonds,
 government contracts, performance and return-of-money bonds, easements,
 rights-of-way, municipal and zoning ordinances and similar charges,
 encumbrances, title defects or other irregularities that do not materially
 interfere with the


                                 12
<PAGE>

 ordinary course of business of the Borrower or any of its Subsidiaries; and (e)
 any encumbrance, mortgage, security interest, pledge, lien or charge incurred
 in the ordinary course of business.

 SECTION 6. DEFAULT; REMEDIES ON DEFAULT.

      6.1  EVENTS OF DEFAULT. If and for so long as any of the following events
 (herein called "Events of Default") shall occur:

           (a) The Borrower shall default in the payment of principal or
 interest under the Note when the same becomes due; or

           (b) The Borrower shall default in the performance of or compliance
 with any term, covenant, condition or provision contained in any of the Loan
 Documents, and such default shall not have been remedied within twenty (20)
 days after the Lender notifies the Borrower in writing of such default; or

           (c) The Borrower shall become insolvent, or shall make an assignment
 for the benefit of creditors or shall fail generally to pay its debts as they
 become due; or the Borrower shall become the subject of an order for relief in
 an involuntary case under the bankruptcy laws as now or hereafter constituted,
 and such order shall remain in effect and unstayed for a period of sixty (60)
 consecutive days, or shall commence a voluntary case under the bankruptcy laws
 as now or hereafter constituted, or shall file any petition or answer seeking
 for itself any arrangement, composition, adjustment, liquidation, dissolution
 or similar relief to which it may be entitled under any present or future
 statute, law or regulation, or shall file any answer admitting the material
 allegations of any petition filed against it in any such proceedings; or the
 Borrower shall seek or consent to or acquiesce in the appointment of or taking
 possession by, any custodian, trustee, receiver or liquidator of it or of all
 or a substantial part of its properties or assets; or the Borrower shall take
 action looking to its dissolution or liquidation; or within sixty (60) days
 after commencement of any proceedings against the Borrower seeking any
 arrangement, composition, adjustment, liquidation, dissolution or similar
 relief to which it may be entitled under any present or future statute, law or
 regulation, such proceedings shall not have been dismissed; or within sixty
 (60) days after the appointment of, or taking possession by, any custodian,
 trustee, receiver or liquidator of any or of all or a substantial part of its
 properties or assets, without the consent or acquiescence of the Borrower, any
 such appointment or possession shall not have been vacated or terminated; or

           (d) The Guaranty shall be repudiated or breached, or any event
 described in subsection (c) above shall occur with respect to the Guarantor; or

           (e) The Limited Guaranty shall be repudiated or breached, or any
 event described in subsection (c) above shall occur with respect to either
 Limited Guarantor, provided, however, that if the Limited Guaranty terminates
 on August 30, 2002, in accordance with its terms, such termination shall not
 constitute a repudiation hereunder; or

           (f) Any representation made by or on behalf of the Borrower or the
 Guarantor herein or by the Limited Guarantor in the Limited Guaranty, or
 otherwise in writing in connection


                                 13
<PAGE>

 with the Loan shall prove to have been false or incorrect in any material
 respect on the date as of which such representation was made; or

           (g) A final judgment which alone exceeds $2,500,000.00 in amount
 shall be rendered against the Borrower or the Guarantor and shall not be
 covered by insurance reasonably satisfactory to the Lender, or be discharged or
 have execution thereof stayed pending appeal within thirty (30) days after
 entry of such judgment or shall not be discharged within thirty (30) days after
 the expiration of any such stay; or

           (h) The Borrower or the Guarantor shall default under any Capital
 Lease, or under any agreement respecting deferred payment for goods, or under
 any agreement involving the extension of credit to which the Borrower or the
 Guarantor is a party (if such default gives the holder of the obligation the
 right to accelerate the indebtedness) and such default shall not be waived or
 remedied within the time permitted for the remedying of such default under the
 applicable document; or

           (i) The Borrower or the Guarantor shall fail to comply with any
 financial covenant contained in any Capital Lease, or any agreement respecting
 deferred payment for goods, or any agreement involving the extension of credit
 to which the Borrower or the Guarantor is a party (whether or not such
 agreement is hereafter amended or terminated) and such failure shall not be
 waived or remedied within the time permitted for the remedying of such failure
 under the applicable document; or

           j) The Guarantor shall cease to be an air carrier operating under a
 certificate of convenience and necessity from the United States Department of
 Transportation; or

           (k) There occurs any adverse change in the business, assets or
 general financial condition of the Borrower or the Limited Guarantor or the
 Guarantor which has or, in the reasonable opinion of the Lender, could have, a
 material adverse effect upon the ability of the Borrower to observe and perform
 its obligations under the Loan Documents, or a material adverse effect upon the
 ability of the Limited Guarantor to observe and perform its obligations under
 the Limited Guaranty, or a material adverse effect upon the ability of the
 Guarantor to observe and perform its obligations under the Guaranty; or

           (l) Any "Event of Default" shall have occurred under the Line of
 Credit Agreement (unless the same is remedied within any cure period provided
 for therein);

      THEN, AND IN ANY SUCH EVENT, in addition to all remedies conferred by law,
 the Lender shall have the option to declare the Note to be due and payable,
 whereupon the entire aggregate unpaid principal balance under the Note, all
 accrued but unpaid interest thereon, and all fees, charges and other sums
 payable under the Loan Documents, shall forthwith mature and become due and
 payable, without presentment, demand, protest or notice of any kind, all of
 which are hereby expressly waived, and upon such maturity by acceleration or
 otherwise, all such principal, interest, fees, charges and other sums, shall
 bear interest at the rate provided in the Note to be paid following an Event of
 Default.


                                 14
<PAGE>

      6.2  RIGHT OF CONTEST. The Borrower shall have the right to contest in
 good faith any claim, demand, levy or assessment by a third party the assertion
 of which would constitute an Event of Default hereunder; PROVIDED, HOWEVER, any
 such contest shall be prosecuted diligently and in a manner not prejudicial to
 the Lender hereunder; and, upon demand by the Lender, the Borrower shall make
 suitable provision by payment to the Lender or by bond satisfactory to the
 Lender for the possibility that the contest will be unsuccessful. Such
 provision shall be made within ten (10) days after demand therefor and, if made
 by payment of funds to the Lender, the amount so deposited shall be disbursed
 in accordance with the resolution of the contest either to the Borrower or the
 adverse claimant.

      6.3  MARSHALLING. The Borrower hereby waives any and all rights to require
 any security given hereunder to be marshalled and agrees and acknowledges that
 after the occurrence of any Event of Default, the Lender may, in its sole and
 absolute discretion, proceed to enforce its rights under the Loan Documents and
 to realize on any or all of the security for the repayment of the amounts
 outstanding under the Loan or any portion or portions thereof, irrespective of
 the differing nature of such security and whether or not the same constitutes
 real or personal property.

 SECTION 7. MISCELLANEOUS PROVISIONS.

      7.1  AUTHORITY TO FILE NOTICES. The Borrower irrevocably appoints,
 constitutes and designates the Lender its attorney-in-fact to file for record
 any notice that the Lender reasonably deems necessary or desirable to protect
 its interests hereunder or under any of the Loan Documents. Such power shall be
 deemed coupled with an interest and shall be irrevocable while any sum remains
 due and owing under any of the Loan Documents, or any obligation of the
 Borrower thereunder remains unperformed.

      7.2  ACTIONS. The Lender shall have the right to commence, appear in or
 defend any action or proceeding purporting to affect the rights, duties or
 liabilities of the parties hereunder, or the amounts outstanding under the
 Loan, whether or not an Event of Default has occurred hereunder. In connection
 therewith, the Lender may incur and pay reasonable costs and expenses,
 including, but not limited to, reasonable attorneys' fees. The Borrower shall
 pay to the Lender all such expenses upon demand made therefor.

      7.3  TIMELINESS. TERM OF AGREEMENT; SURVIVAL OF REPRESENTATIONS AND
 WARRANTIES. Time is of the essence of this Agreement. This Agreement shall
 continue in full force and effect until all indebtedness of the Borrower to the
 Lender under the other Loan Documents shall have been paid in full, all
 obligations of the Borrower under this Agreement and the Loan Documents have
 been observed and performed, and all obligations of the Lender under this
 Agreement and the other Loan Documents have been terminated. All
 representations and warranties contained herein or made in writing by or on
 behalf of the Borrower in connection with the Loan shall survive the execution
 and delivery of the Loan Documents and any investigation at any time made by,
 through or on behalf of the Lender. All statements contained in any certificate
 or other instrument delivered to the Lender on behalf of the Borrower pursuant
 hereto or otherwise in connection with the Loan shall constitute
 representations and warranties hereunder.


                                 15
<PAGE>

      7.4  AMENDMENTS AND WAIVERS. Neither this Agreement nor any provision
 hereof may be amended, waived, discharged or terminated orally, but only by an
 instrument in writing, signed by the party against whom enforcement of the
 amendment, waiver, discharge or termination is sought.

      7.5  REMEDIES ARE CUMULATIVE. All rights, powers and remedies herein given
 to the Lender are cumulative and not alternative, are in addition to all
 rights, powers and remedies afforded by statutes or rules of law and may be
 exercised concurrently, independently, or successively in any order whatsoever.
 Without limiting the generality of the foregoing, the Lender may enforce any
 one or more of the Loan Documents without enforcing all of them concurrently or
 in any particular order.

      7.6  NO WAIVER. No failure, forbearance or delay on the part of the Lender
 in exercising any power or right under any of the Loan Documents shall operate
 as a waiver of the same or any other power or right, and no single or partial
 exercise of any such power or right shall preclude any other or further
 exercise thereof or the exercise of any other such power or right.

      7.7  NO JOINT VENTURE. The execution of this Agreement, the purchase of
 the Note by the Lender, and the exercise of any rights hereunder, are not
 intended, and shall not be construed, to create a partnership or joint venture
 between the Lender and the Borrower.

      7.8  NOTICES. All notices, requests, demands or documents which are
 required or permitted to be given or served hereunder shall be in writing and
 personally delivered, or sent by registered or certified mail addressed or sent
 by facsimile as follows:

           TO BORROWER at: 371 Aokea Street
                           Honolulu, Hawaii 96819
                           Attention: Executive Vice President-Finance &
                                      Planning and Chief Financial Officer
                           FAX: (808) 833-3100

           TO LENDER at:  First Hawaiian Bank
                          999 BISHOP STREET
                          Honolulu, Hawaii 96813
                          Attention: Danford H. Oshima
                                     Vice President Corporate Banking Division
                          FAX: (808) 525-6372

 The addresses may be changed from time to time by the addressee by serving
 notice as heretofore provided. Service of such notice or demand shall be deemed
 complete on the date of actual delivery as shown by the addressee's registry or
 certification receipt or at the expiration of the second day after the date of
 mailing, whichever is earlier in time.

      The Borrower hereby irrevocably authorizes the Lender to accept facsimile
 ("FAX") transmissions of such notices, requests, demands and documents,
 provided such transmission is signed by an officer of the Borrower authorized
 to do so in a corporate resolution. The Borrower shall and does hereby hold the
 Lender harmless from, and indemnify the Lender against, any loss, cost,
 expense, claim or demand which may be incurred by or asserted against the
 Lender by virtue


                                 16
<PAGE>

 of the Lender acting upon any such notices, requests, demands or documents
 transmitted in accordance with the above provisions. The Borrower shall confirm
 any such FAX transmission separately by telephone conference between the Lender
 and the individuals signing such FAX transmission, and shall thereafter
 transmit to the Lender the actual "hard copy" of the notice, request, demand or
 document in question.

      7.9  WAIVER OF JURY TRIAL. The Borrower hereby knowingly, voluntarily and
 intentionally waives any right it may have to a jury trial in any legal
 proceeding which may be hereafter instituted by the Lender or the Borrower to
 assert any of their respective claims arising out of or relating to any of the
 Loan Documents or any other agreement, instrument or document contemplated
 thereby. In such event, the Borrower, at the request of the Lender, shall cause
 its attorney of record to effectuate such waiver in compliance with the Hawaii
 Rules of Civil Procedure, as the same may be amended from time to time.

      7.10 ENTIRE AGREEMENT. The Loan Documents constitute all of the agreements
 between the parties relating to the Loan and supercede all other prior or
 concurrent oral or written letters, agreements or understandings. Without
 limiting the generality of the foregoing, the provisions of this Agreement
 supercede all inconsistent provisions contained in the Purchase Agreement and
 in the event of any discrepancy between the provisions of this Agreement and
 the Purchase Agreement the provisions of this Agreement shall control.

      7.11 ASSIGNMENT; PARTIES IN INTEREST. THE Borrower shall not assign its
 interest in this Agreement without the prior written consent of the Lender,
 which consent may be withheld by the Lender in its sole and absolute
 discretion. The Lender may assign its interest in this Agreement or any portion
 thereof, with the prior written consent of the Borrower; provided, however,
 that the consent of the Borrower shall not be unreasonably withheld. The Lender
 may, upon notice to the Borrower, at any time sell to one or more Participants
 participating interests in its share of the Loan PROVIDED, HOWEVER, that (i)
 the Lender's obligations under this Agreement shall remain unchanged, (ii) the
 Lender shall remain solely responsible for the performance of such obligations,
 and (iii) the Borrower shall continue to deal solely and directly with the
 Lender in connection with its rights and obligations under this Agreement and
 the other Loan Documents. All of the terms and provisions of this Agreement
 shall be binding upon and inure to the benefit of and be enforceable by the
 parties hereto and their respective successors and assigns, whether or not
 hereinabove so expressed and, in particular, shall inure to the benefit of and
 be enforceable by the holder or holders from time to time of the Note or any
 part thereof or interest therein.

      7.12 HEADINGS OF PARAGRAPHS. The headings of paragraphs and subparagraphs
 herein are inserted only for convenience and reference and shall in no way
 define, limit or describe the scope or intent of any provision of this
 Agreement.

      7.13 APPLICABLE LAW. This Agreement is executed and delivered in and shall
 be construed and enforced in accordance with the laws of the State of Hawaii.

      7.14 COUNTERPARTS. This Agreement may be executed in two or more
 counterparts, each of which shall be deemed to be an original, but all of which
 shall constitute one and the same


                                 17
<PAGE>

 instrument, and in making proof of this Agreement, it shall not be necessary to
 produce or account for more than one such counterpart.

      7.15 SEVERABILITY. If any provision of this Agreement or the other Loan
 Documents is held to be invalid or unenforceable, the validity and
 enforceability of the other provisions of this Agreement and the other Loan
 Documents will remain unaffected.

      7.16 TERMS AND CONDITIONS OF THIS AGREEMENT SUPPLEMENT OTHER LOAN
 DOCUMENTS. The terms and conditions of this Agreement and the covenants,
 representations and warranties of the Borrower under this Agreement shall not
 be deemed to supersede, amend or modify the obligations and duties of the
 Borrower under the other Loan Documents. The terms and conditions of this
 Agreement and the covenants, representations and warranties of the Borrower
 hereunder merely supplement, and do not supplant or supersede, provisions of
 similar effect or subject matter in the other Loan Documents.

      7.17 AGENTS. In exercising any rights under this Agreement or the other
 Loan Documents, the Lender may act through its employees, agents or independent
 contractors; provided that the Lender shall remain responsible for the actions
 of such employees and agents.

      7.18 CONSENT BY THE LENDER. Whenever the consent of the Lender is required
 by the terms of this Agreement, except where the granting of such consent is
 reserved to the Lender in its sole judgment, option or discretion, such consent
 shall not be unreasonably or arbitrarily withheld.

      7.19 LENDER'S RIGHT OF SETOFF. Upon the occurrence of any Event of
 Default, or if the Lender shall be served with garnishee process, whether or
 not the Borrower shall be in default hereunder at the time, the Lender may, but
 shall not be required to, set off any indebtedness owing by the Lender to the
 Borrower against any indebtedness under the Loan Documents, without prejudice
 to any other rights or remedies of the Lender thereunder.

      7.20 CONFIDENTIALITY. Notwithstanding the provisions of Section 15.9 of
 the Purchase Agreement, the Lender's obligations regarding non-disclosure of
 "information" about the Borrower or any Subsidiary shall only apply to
 information designated by the Borrower as "Confidential" at the time such
 information is provided to the Lender, and the Lender shall be released from
 any and all restrictions on the disclosure of any such information if an Event
 of Default has occurred and is continuing hereunder.


                                 18
<PAGE>

      IN WITNESS WHEREOF, the Borrower and the Lender have executed this
 Agreement on the day and year first above stated.

                                  FIRST HAWAIIAN BANK

                                  By /s/ Danford H. Oshima
                                     -----------------------------------
                                     Danford H. Oshima
                                     Its Vice President
                                                                          Lender


                                   ALOHA AIRGROUP, INC.

                                  By /s/ Glenn R. Zander
                                     -----------------------------------
                                     Glenn R. Zander
                                     Its President and CEO


                                  By /s/ Brenda F. Cutwright
                                     -----------------------------------
                                     Brenda F. Cutwright
                                     Its EVP, CFO and Treasurer
                                                                        Borrower


                                 19
<PAGE>

                                      NOTE

           THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS. NEITHER
 THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD,
 ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
 ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
 SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF
 THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE
 TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE LATER OF
 THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
 AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
 THIS SECURITY) (THE "RESALE RESTRICTION TERMINATION DATE") ONLY (A) TO THE
 COMPANY OR ANY SUBSIDIARY, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
 UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
 RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A
 PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED
 IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
 QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
 BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO
 NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
 REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED
 INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a)(1), (2),(3) OR (7) OF RULE 501
 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR
 FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT
 PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
 DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER
 AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
 SUBJECT TO THE COMPANY'S AND THE TRANSFER AGENT'S RIGHT PRIOR TO ANY SUCH
 OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (E) OR (F) PRIOR TO THE RESALE
 RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
 CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii)IN
 EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE
 FORM APPEARING ON THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO
 THE TRANSFER AGENT. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER
 AFTER THE RESALE RESTRICTION TERMINATION DATE.


                                   EXHIBIT "1"

<PAGE>


                               ALOHA AIRGROUP INC.

       SENIOR SECURED GUARANTEED FLOATING RATE NOTES DUE SEPTEMBER 8, 2008

 NO._______                                            Dated: September 8, 2000

 $20,000,000.00

           FOR VALUE RECEIVED, the undersigned, ALOHA AIRGROUP, INC., a Hawaii
 corporation (the "Company"), HEREBY PROMISES TO PAY to BANCWEST CORPORATION, a
 Delaware corporation, or its registered assigns, the principal amount of TWENTY
 MILLION AND N0/100 U.S. Dollars (US$20,000,000.00), or such lesser unpaid
 principal amount as shall be outstanding hereunder, together with interest at
 the applicable rate set forth below.

           Payments of principal of, and interest on, this Note are payable in
 lawful money of the United States of America at the place designated therefor
 as set forth in Section 9.1 of the Purchase Agreement (as defined below), or at
 such other place as the Company shall have designated by written notice to the
 holder of this Note as provided in the Purchase Agreement referred to below.
 Whenever any payment under this Note 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.

           This Note is one of a series of Senior Secured Guaranteed Floating
 Rate Notes due September 8, 2008 (collectively, the "NOTES") originally issued
 or to be issued in an aggregate principal amount of up to $40,000,000 pursuant
 to the Purchase Agreement dated as of September 8, 2000 (as amended,
 supplemented or otherwise modified from time to time, the "PURCHASE AGREEMENT";
 capitalized terms not otherwise defined herein having the same meanings as
 specified in the Purchase Agreement) between the Company and the respective
 purchasers of the Company's Series C 10% Senior Exchangeable Preferred Stock
 (the "PREFERRED SHARES") (collectively, the "PURCHASERS") named therein and
 pursuant to the Certificate of Designation relating to the Preferred Shares
 (the "CERTIFLICATE OF DESIGNATION").

      1.   DEFINITIONS

           As used in this Note, the following terms shall have the following
           meanings:

           (a) "ONE-MONTH LIBOR RATE" means the average of the offered rates of
      interest (rounded upward, if necessary, to the next higher 1/16th of 1 %)
      which appear on the Telerate Screen LIBO Page as of 11:00 a.m. London Time
      on the day that is two (2) LIBOR Business Days prior to the day on which
      the applicable Interest Period is to begin, for deposits, in U.S Dollars,
      for a period of one month.


                                        2
<PAGE>

         (b) "TWO-MONTH LIBOR RATE" means the average of the offered rates of
    interest (rounded upward, if necessary, to the next higher 1/16th of 1 %)
    which appear on the Telerate Screen LIBO Page as of 11:00 a.m. London Time
    on the day that is two (2) LIBOR Business Days prior to the day on which
    the applicable Interest Period is to begin, for deposits, in U.S.
    Dollars, for a period of two months.

         (c) "THREE-MONTH LIBOR RATE" means the average of the offered rates of
    interest (rounded upward, if necessary, to the next higher 1/16th of 1 %)
    which appear on the Telerate Screen LIBO Page as of 11:00 a.m. London Time
    on the day that is two (2) LIBOR Business Days prior to the day on which the
    applicable Interest Period is to begin, for deposits, in U.S.
    Dollars, for a period of three months.

         (d) "BUSINESS DAY" means a day on which the banks are open for business
    in the state of Hawaii.

         (e)  "CONSOLIDATION" has the meaning set forth in the
    Purchase Agreement.

         (f) "INTEREST PERIOD" means the period commencing on the date
    designated in the applicable Notice of Selection of Interest Rate, and
    ending one, two or three months thereafter, as specified in such Notice of
    Selection of Interest Rate, provided that: (i) any Interest Period which
    would otherwise end on a day which is not a Business Day shall be extended
    to the next succeeding Business Day, unless such Business Day falls in
    another calendar month, in which case such Interest Period shall end on the
    previous Business Day; (ii) any Interest Period which begins on the last
    Business Day of a calendar month or on a day for which there is no
    numerically corresponding day in the calendar month at the end of such
    Interest Period, shall end on the last Business Day of a calendar month; and
    (iii) no Interest Period shall extend beyond the Maturity Date.

         (g)  "LIBOR BUSINESS DAY" means a day on which London banks are open
    for business for trading inter-bank U.S. Dollar deposits.

         (h) "NOTICE OF SELECTION OF INTEREST RATE" means a Notice of Selection
    of Interest Rate described in paragraph 2 below.

         (i) "PRIME RATE" means the lending rate of interest per annum announced
    publicly by the First Hawaiian Bank from time to time as its "Prime Interest
    Rate", which rate shall not necessarily be the best or lowest rate charged
    by First Hawaiian Bank from time to time.

         (j)  "PRINCIPAL BALANCE" means the outstanding principal balance of
    this Note.

         (k) "QUARTER" means any one of the following three-calendar-month
    periods in any calendar year: April 1 to and including June 30; July 1 to
    and including September 30; October 1 to and including December 31; and
    January 1 to and including March 31.


                                        3
<PAGE>

         (l) "TANGIBLE NET WORTH" has the meaning set forth in the Purchase
    Agreement.

    2.   INTEREST RATE

         This Note shall bear interest in accordance with the following terms:

         (a) From the issue date of this Note until the end of the Quarter
    immediately following the Issue Date, at a fluctuating rate per annum equal
    to one-fourth of one (.25) percentage point higher than the Prime Rate in
    effect from time to time during such period. Each change in such fluctuating
    rate shall take effect simultaneously with the corresponding change in the
    Prime Rate.

          (b) From the end of the Quarter immediately following the Issue Date
    until the third anniversary of the Issue Date:

              (i) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of $38,000,000
         or more, at the Company's option, the One-Month LIBOR Rate, the
         Two-Month LIBOR Rate or the Three-Month LIBOR Rate, plus, in each case,
         2.25%. If the Company selects the One-Month LIBOR Rate as the rate upon
         which interest shall be based, interest shall accrue for an Interest
         Period of one month. If the Company selects the Two-Month LIBOR Rate or
         the Three-Month LIBOR Rate as the rate upon which interest shall be
         based, interest shall accrue for an Interest Period of two months or
         three months, respectively. In each case described in this paragraph
         (b)(i), interest shall be computed on the basis of a 360-day year.

              (ii) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $30,000,000 but less than $38,000,000, at a fluctuating rate per annum
         equal to one-fourth of one (.25) percentage point higher than the Prime
         Rate in effect from time to time during such period. Each change in
         such fluctuating rate shall take effect simultaneously with the
         corresponding change in the Prime Rate.

              (iii) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $23,000,000 but less than $30,000,000, at a fluctuating rate per annum
         equal to one-half of one (.50) percentage point higher than the Prime
         Rate in effect from time to time during such period. Each change in
         such fluctuating rate shall take effect simultaneously with the
         corresponding change in the Prime Rate.

               (iv) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $16,000,000 but


                                        4
<PAGE>

         less than $23,000,000, at a fluctuating rate per annum equal to
         three-fourths of one (.75) percentage point higher than the Prime Rate
         in effect from time to time during such period. Each change in such
         fluctuating rate shall take effect simultaneously with the
         corresponding change in the Prime Rate.

              (v) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of less than
         $16,000,000, at a fluctuating rate per annum equal to one and one-half
         (1.50) percentage points higher than the Prime Rate in effect from time
         to time during such period. Each change in such fluctuating rate shall
         take effect simultaneously with the corresponding change in the Prime
         Rate.

         (c) From the third anniversary of the Issue Date until the fifth
    anniversary of the Issue Date:

              (i) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of $38,000,000
         or more, at the Company's option, the One-Month LIBOR Rate, the
         Two-Month LIBOR Rate or the Three-Month LIBOR Rate, plus, in each case,
         2.75%. If the Company selects the One-Month LIBOR Rate as the rate upon
         which interest shall be based, interest shall accrue for an Interest
         Period of one month. If the Company selects the Two-Month LIBOR Rate or
         the Three-Month LIBOR Rate as the rate upon which interest shall be
         based, interest shall accrue for an Interest Period of two months or
         three months, respectively. In each case described in this paragraph
         (c)(i), interest shall be computed on the basis of a 360-day year.

              (ii) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $30,000,000 but less than $38,000,000, at a fluctuating rate per annum
         equal to three-fourths of one (.75) percentage point higher than the
         Prime Rate in effect from time to time during such period. Each change
         in such fluctuating rate shall take effect simultaneously with the
         corresponding change in the Prime Rate.

              (iii) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $23,000,000 but less than $30,000,000, at a fluctuating rate per annum
         equal to one (1.00) percentage point higher than the Prime Rate in
         effect from time to time during such period. Each change in such
         fluctuating rate shall take effect simultaneously with the
         corresponding change in the Prime Rate.


                                        5
<PAGE>

              (iv) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $16,000,000 but less than $23,000,000, at a fluctuating rate per annum
         equal to one and one-fourth (1.25) percentage points higher than the
         Prime Rate in effect from time to time during such period. Each change
         in such fluctuating rate shall take effect simultaneously with the
         corresponding change in the Prime Rate.

              (v) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of less than
         $16,000,000 at a fluctuating rate per annum equal to two (2.00)
         percentage points higher than the Prime Rate in effect from time to
         time during such period. Each change in such fluctuating rate shall
         take effect simultaneously with the corresponding change in the Prime
         Rate.

         (d) From the fifth anniversary of the Issue Date until the stated
    maturity date of this Note:

              (i) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of $38,000,000
         or more, at a fluctuating rate per annum equal to one-fourth of one
         (.25) percentage point higher than the Prime Rate in effect from time
         to time during such period. Each change in such fluctuating rate shall
         take effect simultaneously with the corresponding change in the Prime
         Rate.

              (ii) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $30,000,000 but less than $38,000,000, at a fluctuating rate per annum
         equal to one (1.00) percentage point higher than the Prime Rate in
         effect from time to time during such period. Each change in such
         fluctuating rate shall take effect simultaneously with the
         corresponding change in the Prime Rate.

              (iii) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $23,000,000 but less than $30,000,000, at a fluctuating rate per annum
         equal to one and one-fourth (1.25) percentage points higher than the
         Prime Rate in effect from time to time during such period. Each change
         in such fluctuating rate shall take effect simultaneously with the
         corresponding change in the Prime Rate.

              (iv) If the Company has a Consolidated Tangible Net Worth for the
         Quarter immediately preceding the date of determination of at least
         $16,000,000 but


                                        6
<PAGE>

           less than $23,000,000, at a fluctuating rate per annum equal to one
           and one-half (1.50) percentage points higher than the Prime Rate in
           effect from time to time during such period. Each change in such
           fluctuating rate shall take effect simultaneously with the
           corresponding change in the Prime Rate.

                (v) If the Company has a Consolidated Tangible Net Worth for the
           Quarter immediately preceding the date of determination of less than
           $16,000,000 at a fluctuating rate per annum equal to two and
           one-fourth (2.25) percentage points higher than the Prime Rate in
           effect from time to time during such period. Each change in such
           fluctuating rate shall take effect simultaneously with the
           corresponding change in the Prime Rate.

           (e) In the case of (b)(1) and (c)(1) above, the Company shall, not
     less than three Business Days prior to the date on which the One-Month
     LIBOR Rate, Two-Month LIBOR Rate or Three-Month LIBOR Rate is to commence,
     select the rate at which interest shall accrue by advising the holder of
     this Note and delivering to the holder a written Notice of Selection of
     Interest Rate in the form attached hereto as Exhibit 1. If the Company
     fails to deliver a new Notice of Selection of Interest Rate at least three
     Business Days prior to the end of the current Interest Period, the Company
     shall be deemed to have selected the Prime Rate as the applicable rate for
     the period commencing the day after the end of the current Interest Period
     until the date which is three Business Days after the Company delivers to
     the holder of this Note a valid written Notice of Selection of Interest
     Rate. If the Company selects the One-Month LIBOR Rate, Two-Month LIBOR
     Rate or Three-Month LIBOR Rate and no rates appear on the Telerate Screen
     LIBO Page for the selected Interest Period, the Company shall be deemed to
     have selected the Prime Rate as the applicable rate for the period
     commencing on the date of such determination until the date which is three
     Business Days after the Company delivers to the holder of this Note a valid
     written Notice of Selection of Interest Rate for a LIBOR rate and the
     applicable rate does appear on the Telerate Screen LIBO Page for the
     selected Interest Period.

           (f) Interest based on the Prime Rate shall be computed on the basis
      of a 365-day year.

      3.   PAYMENTS, MATURITY DATE

           Whenever interest is based on the Prime Rate, such interest shall be
 payable monthly, on the first Business Day of each month. Whenever interest is
 based upon the One-Month LIBOR


                                        7
<PAGE>

 Rate, the Two-Month LIBOR Rate or the Three-Month LIBOR Rate, payment shall be
 made at the end of the Interest Period.

      4.   REPAYMENT

           Starting on the third anniversary of the Issue Date, the Company
 shall, in addition to applicable interest payments, make monthly principal
 payments equal to 1.67% of the original principal amount of the Note until the
 stated maturity of this Note, whereupon all unpaid principal and all accrued
 but unpaid interest, shall be due and payable.

      5.   PREPAYMENTS

           The Company may make prepayments of principal without a prepayment
 charge at any time when interest is based on the Prime Rate, and at the end of
 the applicable Interest Period when interest is based on the One-Month LIBOR
 Rate, the Two-Month LIBOR Rate, or the Three-Month LIBOR Rate. Any prepayment
 shall be applied against the principal sum outstanding and shall not postpone
 the due date of any subsequent monthly payment or change the amount of any
 subsequent monthly payment.

      6.   DEFAULT

           If the Company shall default in the payment of principal, interest or
 other fees or charges when due under this Note, or if the Company shall default
 in the performance of or compliance with any term, covenant, condition or
 provision required to be performed or complied with by the Company under any
 other agreement or security instrument executed by the Company in connection
 with this Note (this Note and all such other agreements and instruments being
 hereinafter called the "Loan Documents") and such default shall not have been
 remedied during the period the Company is required to remedy such default,
 then, and in any such event, the holder hereof shall have the option to declare
 the unpaid principal sum of this Note, together with all interest accrued
 thereon, and all fees, charges and other sums payable under the Loan Documents,
 to be immediately due and payable, and such principal sum and interest, and all
 such fees, charges and other sums, shall thereupon become and be due and
 payable without presentment, demand, protest or notice of any kind, all of
 which are hereby expressly waived, and, upon such maturity, by acceleration or
 otherwise, the unpaid principal balance, all accrued but unpaid interest, and
 all such fees, charges and other sums shall thereafter bear interest until
 fully paid at a rate per annum equal to four (4) percentage points higher than
 the rate that would otherwise be in effect from time to time under this Note.
 Failure to exercise this option shall not constitute a waiver of the right to
 exercise the same in the event of the same or any subsequent default.


                                        8
<PAGE>

      7.   LATE CHARGES

           If any payment hereunder shall not have been paid within ten (10)
 days after the same becomes due and payable, the holder of this Note, in
 addition to its other remedies, may collect, and the Company shall pay on
 demand, a late charge equal to five percent (5%) of the amount overdue.

           This Note shall be governed by, and construed in accordance with, the
 laws of the State of Hawaii.

                                 ALOHA AIRGROUP, INC.

                                 By _____________________________
                                 Name: Glenn R. Zander
                                 Title: President and CEO

                                 By _____________________________
                                 Name: Brenda F. Cutwright
                                 Title: EVP, CFO and Treasurer




                                        9
<PAGE>

                                   EXHIBIT "1"

                      NOTICE OF SELECTION OF INTEREST RATE

 To: [Holder]


                                               Date: ________________________

           We refer to the above-captioned Note and hereby:

           (1)          give you notice that we wish to select

                [ ]     the One-Month LIBOR Rate

                [ ]     the Two-Month LIBOR Rate

                [ ]     the Three-Month LIBOR Rate

           (2)          confirm that the selection of the interest rate for such
     advance is within our corporate powers and has been validly authorized by
     appropriate corporation action; that no Event of Default has occurred and
     no event has occurred which, with the giving of notice and/or the lapse of
     time would constitute an Event of Default; and

           (3)          confirm that the Company has a Consolidated Tangible Net
     Worth for the Quarter immediately preceding the date of determination of
     $38,000,000 or more.

           Terms defined in the Note shall have the same meanings in this
     Notice.


                                  ALOHA AIRGROUP, INC.


                                  By:_____________________________________
                                     Its:



                                  By:_____________________________________
                                     Its:


                                       10
<PAGE>

                                     ALLONGE

           Pay to the Order of FIRST HAWAIIAN BANK,
           without recourse, warranty or representation

                BANCWEST CORPORATION

                By__________________________________
                  John K. Tsui
                  Its Vice President and Chief Credit Officer


                By__________________________________
                  Howard H. Karr
                  Its Executive Vice President and Chief Financial Officer


                Date:_______________________________


<PAGE>

                                   EXHIBIT "2"




                               Opinion of Counsel





                                [To Be Attached]



<PAGE>

                                    GUARANTY

          WHEREAS, ALOHA AIRGROUP, INC., a Hawaii corporation (the "Company"),
 has issued 20,000 shares of Series C 10% Exchangeable Preferred Stock (the
 "Preferred Shares") to BancWest Corporation, a Delaware corporation, pursuant
 to the terms and provisions of that certain Purchase Agreement dated as of
 September 8, 2000 (the "Purchase Agreement"); and

          WHEREAS, the Purchase Agreement provides that the Preferred Shares
 will be exchangeable, at the Company's option, into Senior Secured Guaranteed
 Floating Rate Notes (the "Notes") at $1,000 for each Preferred Share; and

          WHEREAS, the Company has exercised its option to exchange the
 Preferred Shares held by BancWest Corporation into the Notes; and

          WHEREAS, BancWest Corporation has agreed to sell and assign the Notes
 to First Hawaiian Bank, a Hawaii corporation ("FHB"), and FHB has agreed to
 purchase and accept an assignment of the Notes; and

          WHEREAS, upon such assignment, FHB will become a registered holder of
 the Notes in the aggregate amount of $20,000,000.00; and

          WHEREAS, the Purchase Agreement provides that the Company will, at the
 request of any holder of at least $15,000,000.00 of Notes, cause ALOHA
 AIRLINES, INC., a Delaware corporation (the "Guarantor"), to enter into a
 Guaranty of the Notes containing such terms and provisions as may be required
 by such holder;

          NOW, THEREFORE, pursuant to the provisions of the Purchase Agreement,
 and in consideration of FHB's agreement to purchase and accept an assignment of
 the Notes, as described above, the Guarantor hereby agrees as follows:

          The Guarantor hereby unconditionally and irrevocably guarantees to
 FHB, and to each holder of any interest in the Notes (each holder of any
 interest in the Notes being hereinafter collectively and individually called
 the "Holder") that: (i) the Company will duly and punctually repay all amounts
 outstanding under the Notes, together with interest thereon, in accordance with
 the provisions thereof and of that certain Loan Agreement executed concurrently
 herewith by the Company and FHB (the "Loan Agreement"), whether at maturity, or
 by acceleration or otherwise, all at the times and place and at the rate and in
 the currency described therein; (ii) the Company will duly and punctually
 observe and perform each and every agreement, covenant and condition on its
 part to be observed or performed under the "Loan Documents" defined in the Loan
 Agreement; and (iii) the Guarantor will pay to the Holder, promptly after
 demand, the costs and expenses, including, but not limited to, attorneys' fees,
 incurred in connection with enforcing the rights of the Holder against the
 Guarantor following any default in the due observance or performance of any
 agreement, covenant or condition on the part of the Company to be performed or
 observed under the Loan Documents.

          For the consideration aforesaid, the Guarantor hereby further
 covenants and agrees as follows:


<PAGE>


          1. UNCONDITIONAL AND ABSOLUTE GUARANTY. This is an unconditional and
 absolute guaranty of payment and not merely a guaranty of collection, and if
 for any reason, any duty, agreement or obligation of the Company contained in
 any of the Loan Documents shall not be observed or performed by it, or if any
 amounts or any part thereof payable under or in connection with any of the Loan
 Documents shall not be paid in full when and as due and payable, the Guarantor
 undertakes promptly to observe and perform or cause to be observed and
 performed each of such duties, agreements and obligations and to pay forthwith
 such amounts to the Holder, regardless of any defense or setoff or counterclaim
 which the Company may have or assert, and regardless of whether or not any
 Holder or anyone on behalf of such Holder shall have instituted any suit,
 action or proceeding or exhausted its remedies or taken any steps to enforce
 any rights against any of such parties or any other person to compel any such
 performance or to collect all or part of any such amounts, either pursuant to
 the Loan Documents, or at law or in equity, and regardless of any other
 condition or contingency.

          2. WAIVER. The Guarantor hereby unconditionally waives any and all
 statutory and common law suretyship defenses that now or hereafter may be
 available to the Guarantor, to the extent permitted by applicable law,
 including, without limitation (a) any requirement that any Holder in the event
 of any default by the Company first make demand upon, or seek to enforce
 remedies against, the Company or any other guarantor or any security or
 collateral held by FHB at any time, or to pursue any other remedy in its power,
 before being entitled to payment from the Guarantor of the amounts payable by
 the Guarantor hereunder, or before proceeding against the Guarantor; (b) any
 defense that may arise by reason of (i) the revocation or repudiation of this
 Guaranty by the Guarantor, or the revocation or repudiation of any of the Loan
 Documents by the Company or any other person or entity, (ii) the failure of FHB
 to file or enforce a claim against the estate (either in administration,
 bankruptcy or any other proceeding) of the Company or any other person or
 entity, or (iii) the invalidity, irregularity or unenforceability in whole or
 in part of the Notes or any of the other Loan Documents or any other document,
 instrument, or agreement referred to therein, or any limitation on the
 liability of the Company thereunder, or any limitation on the method or terms
 of payment thereunder, which may now or hereafter be caused or imposed in any
 manner whatsoever; (c) diligence, presentment, demand for payment, protest,
 notice of discharge, notice of acceptance of this Guaranty, and indulgences and
 notices of any other kind whatsoever; (d) any defense based upon an election of
 remedies (including, if available, an election to proceed by non-judicial
 foreclosure) by FHB which destroys or otherwise impairs any subrogation rights
 of the Guarantor or the right of the Guarantor to proceed against the Company
 for reimbursement, or both; (e) any defense based upon any taking, modification
 or release of any collateral or guaranties for the indebtedness of the Company
 under the Notes, or any failure to perfect any security interest in, or the
 taking of any other action or the failure to take any other action with respect
 to any collateral securing the payment of such indebtedness or the performance
 of the obligations (including payment obligations) of the Company under the
 Loan Documents; (f) any rights or defenses based upon an offset by the
 Guarantor against any obligation now or hereafter owed to the Guarantor by the
 Company; or (g) any right of appraisement with regard to the value of any
 collateral which FHB may apply as a credit to the obligations of the Company,
 through foreclosure or otherwise, and agrees that the determination by an
 independent appraiser appointed by FHB of the value of such collateral shall be
 binding upon the Guarantor for all purposes; it being the intention hereof that
 the Guarantor shall remain fully liable, as principal, until the full payment
 of the indebtedness under the Notes, and full performance of all the
 obligations (including payment obligations) of the Company under the Loan

                                       -2-


<PAGE>


 Documents, notwithstanding any act, omission or thing which might otherwise
 operate as a legal or equitable discharge of the Guarantor.

          3. NO RELEASE OF GUARANTY. The obligations, covenants, agreements
 and duties of the Guarantor under this Guaranty shall not be released,
 affected, stayed or impaired, without the written consent of the Holder, by (a)
 any assignment, indorsement or transfer, in whole or in part, of the Notes,
 although made without notice to or the consent of the Guarantor; or (b) any
 waiver by the Holder of the performance or observance by the Company or the
 Guarantor of any of the agreements, covenants, terms or conditions contained in
 the Loan Documents; or (c) any extension of the time for payment of any amounts
 payable under or in connection with the Loan Documents or of the time for
 performance by the Company or the Guarantor of any other obligations under or
 arising out of the Loan Documents or any extension or renewal thereof; or (d)
 the modification or amendment (whether material or otherwise) of any duty,
 agreement or obligation of the Company set forth in the Loan Documents; or (e)
 the voluntary or involuntary liquidation, sale or other disposition of all or
 substantially all of the assets of the Company or the Guarantor; or (f) any
 receivership, insolvency, bankruptcy, reorganization, dissolution or other
 similar proceedings, affecting the Company or the Guarantor or any of their
 assets; or (g) any release of any property from the lien and security interest
 created by any of the Loan Documents or the acceptance of additional or
 substitute property as security under the Loan Documents; or (h) the release or
 discharge of the Company from the observance or performance of any agreement,
 covenant, term or condition contained in the Loan Documents; or (i) any action
 which the Holder may take or omit to take by virtue of the Loan Documents or
 through any course of dealing with the Company; or (j) the addition of a new
 guarantor (the Guarantor acknowledging that certain shareholders of the Company
 will be providing limited guaranties to FHB with respect to the Company's
 obligations under the Notes and the other Loan Documents, but that the Holder
 has no obligation to seek to enforce any remedies against any of such limited
 guarantors before being entitled to payment from the Guarantor of the entire
 amount guaranteed hereunder); or (k) any change in the status or structure of
 the Company, including any change by incorporation, merger or consolidation;
 (l) any change in the composition of the Company, including, without
 limitation, any addition of, removal of, replacement for or substitution of any
 officer or stockholder of the Company (if the Company is a corporation), any
 addition of, removal of, replacement for or substitution of any general or
 limited partner of the Company (if the Company is a partnership), or any
 addition of, removal of, replacement for or substitution of any member of the
 Company (if the Company is a limited liability company or partnership); or (m)
 the operation of law or any other cause, whether similar or dissimilar to the
 foregoing, PROVIDED, HOWEVER, that notwithstanding the foregoing, no such
 waiver, extension, modification or amendment shall without the consent of the
 Guarantor increase the principal amount of the Notes, or increase the interest
 rate payable thereon, or increase any premium payable upon redemption thereof,
 or shorten the stated maturity thereof, except in accordance with the express
 provisions of the Notes and the Loan Documents.

          4. WAIVER OF SUBROGATION. The Guarantor hereby waives any and all
 right the Guarantor may have to be subrogated to the right of the Holder to
 receive payments or distributions of assets of the Company following any
 payment made by the Guarantor on this Guaranty, unless and until all amounts
 payable under the Notes have been paid and all other amounts payable under this
 Guaranty shall have been paid in full, and the Holder shall have received an
 opinion from counsel to the Guarantor, acceptable to the Holder, that the
 payment of all amounts due under the Notes does

                                       -3-


<PAGE>


 not constitute a payment which may be avoided or recovered directly or
 indirectly from the Holder as a preference, fraudulent transfer or otherwise in
 any bankruptcy, reorganization or insolvency proceeding of or against the
 Company. If (i) the Guarantor shall make payment to any Holder under this
 Guaranty, (ii) all amounts under the Notes and any amounts payable under this
 Guaranty shall have been paid in full, (iii) the maturity date of the Notes
 shall have occurred, and (iv) the Holder shall have received an opinion from
 counsel to the Guarantor, acceptable to the Holder, that the payment of all
 amounts due under the Notes does not constitute a payment which may be avoided
 or recovered directly or indirectly from the Holder as a preference, fraudulent
 transfer or otherwise in any bankruptcy, reorganization or insolvency
 proceeding of or against the Company, the Holder will, at the Guarantor's
 request and expense, execute and deliver to the Guarantor appropriate
 documents, necessary to evidence the transfer by subrogation to the Guarantor
 of an interest resulting from such payment made by the Guarantor pursuant to
 this Guaranty.

          5. SUBORDINATION OF INDEBTEDNESS; BANKRUPTCY OF COMPANY. Any
 indebtedness of the Company now or hereafter held by the Guarantor is hereby
 subordinated to the indebtedness of the Company to the Holder; and, upon the
 request of the Holder, such indebtedness of the Company to the Guarantor shall
 be collected, enforced and received by the Guarantor as trustee for the Holder
 and shall be paid over to the Holder on account of the indebtedness of the
 Company to the Holder without reducing or affecting in any manner the liability
 of the Guarantor under the other provisions of this Guaranty.

          6. CLAIMS IN BANKRUPTCY. The Guarantor will file all claims against
 the Company in any bankruptcy or other proceeding in which the filing of claims
 is required or permitted by law upon any indebtedness of the Company to the
 Guarantor or claim against the Company by the Guarantor, and the Guarantor
 hereby assigns to FHB all rights of the Guarantor thereunder. If the Guarantor
 does not file any such claim, FHB, as attorney-in-fact for the Guarantor, is
 hereby authorized to do so in the name of the Guarantor or, in FHB's
 discretion, to assign the claim and to cause proof of claim to be filed in the
 name of FHB's nominee. FHB or its nominee shall have the sole right to accept
 or reject any plan proposed in such proceeding and to take any other action
 which a party filing a claim is entitled to take. In all such cases, whether in
 administration, bankruptcy or otherwise, the person or persons authorized to
 pay such claim shall pay to FBB the full amount payable on such claim up to the
 amounts due under this guaranty, and, to the full extent necessary for that
 purpose, the Guarantor hereby assigns to FHB all of the Guarantor's rights to
 any such payments or distributions to which the Guarantor would otherwise be
 entitled; provided, however, that the Guarantor's obligations hereunder shall
 not be satisfied except to the extent that FHB receives cash by reason of any
 such payment or distribution. If FHB receives anything hereunder other than
 cash, the same shall be held as collateral for the payment of all amounts due
 under this Guaranty.

          7. LITIGATION, CHANGE IN GUARANTOR'S FINANCIAL CONDITION. The
 Guarantor will promptly notify FHB of any material adverse litigation to which
 the Guarantor becomes a party and any adverse change in the Guarantor's
 financial condition which might impair or diminish the value of this Guaranty
 to the Holder as an assurance of the repayment of the indebtedness of the
 Company to the Holder. In the event of any such adverse change which so impairs
 or diminishes the value of this Guaranty, the Guarantor will, upon request of
 FHB, promptly furnish or make available to the Holder such satisfactory
 additional security in such manner as the Holder may reasonably request

                                       -4-


<PAGE>


 to compensate for such adverse change. The Guarantor shall promptly furnish the
 Holder with such information, financial or otherwise, as the Holder may from
 time to time request concerning the Guarantor.

          8. CONDITION OF COMPANY. The Guarantor is fully aware of the
 financial condition of the Company and is executing and delivering this
 Guaranty based solely upon the Guarantor's own independent investigation of all
 matters pertinent hereto, and is not relying in any manner upon any
 representation or statement of FHB. The Guarantor represents and warrants that
 the Guarantor is in a position to obtain and the Guarantor hereby assumes full
 responsibility for obtaining, any additional information concerning the
 Company's financial condition and any other matter pertinent hereto as the
 Guarantor may desire, and the Guarantor is not relying upon or expecting FHB to
 furnish to the Guarantor any information now or hereafter in FHB's possession
 concerning the same or any other matter. By executing this Guaranty, the
 Guarantor knowingly acknowledges and accepts the full range of risks
 encompassed within a contract of this type. The Guarantor shall have no right
 to require FHB to obtain or disclose any information with respect to the
 indebtedness under the Notes or the obligations of the Company under the Loan
 Documents, the financial condition or character of the Company, the Company's
 ability to pay such indebtedness or perform such obligations, the existence of
 any collateral or security for any or all of such indebtedness or such
 obligations, the existence or non-existence of any other guaranties of all or
 any part of such indebtedness or such obligations, or any action or non-action
 on the part of FHB, the Company, or any other person, or any other matter, fact
 or occurrence whatsoever.

          9. BANKRUPTCY. Until all indebtedness under the Notes has been paid
 to the Holder, and all obligations under the Loan Documents have been
 performed, the Guarantor shall not, without the prior written consent of the
 Holder, commence or join with any other person in commencing any bankruptcy,
 reorganization or insolvency proceedings of or against the Company. The
 obligations of the Guarantor under this Guaranty shall not be altered, limited
 or affected by any proceeding, voluntary or involuntary, involving the
 bankruptcy, insolvency, receivership, reorganization, liquidation or
 arrangement of the Company or by any defense which the Company may have by
 reason of the order, decree or decision of any court or administrative body
 resulting from any such proceeding. The Guarantor acknowledges and agrees that
 any interest on the indebtedness under the Notes which accrues after the
 commencement of any such proceeding (or, if interest on any portion of such
 indebtedness ceases to accrue by operation of law by reason of the commencement
 of said proceeding, such interest as would have accrued on any such portion of
 such indebtedness if said proceeding had not been commenced) shall be included
 in the indebtedness guaranteed by the Guarantor hereunder, since it is the
 intention of the parties that the amount of the indebtedness which is
 guaranteed by the Guarantor pursuant to this Guaranty should be determined
 without regard to any rule of law or order which may relieve the Company of any
 portion of such indebtedness. The Guarantor will permit any trustee in
 bankruptcy, receiver, debtor in possession, assignee for the benefit of
 creditors or similar person to pay to the Holder, or allow the claim of the
 Holder in respect of, any such interest accruing after the date on which such
 proceeding is commenced. In the event that all or any portion of such
 indebtedness is paid or all or any part of the obligations under the Loan
 Documents are performed by the Company, the obligations of the Guarantor
 hereunder shall continue and remain in full force and effect in the event that
 all or any part of such payment or performance is avoided or recovered directly
 or indirectly from the Holder as a preference, fraudulent transfer or otherwise
 in such proceeding.

                                       -5-


<PAGE>


          10. REMEDIES, CUMULATIVE. The rights and remedies of the Holder
 hereunder and under the Loan Documents are cumulative and not exclusive and may
 be exercised in whole or in part and in any order and at any time or times as
 the Holder shall determine. All security of any kind or nature received or
 receivable by the Holder for the repayment of the indebtedness evidenced by the
 Note may be applied in any manner or order determined by the Holder except as
 expressly provided otherwise in the Loan Documents.

          11. AMENDMENTS, CONTINUING LIABILITY. The terms of this Guaranty may
 not be modified or amended except by a written agreement executed by the
 Guarantor with the consent in writing of the Holder. The obligations of the
 Guarantor under this Guaranty shall be continuing obligations and a separate
 cause of action shall be deemed to arise in respect of each default hereunder.
 The Guarantor will from time to time deliver, upon request of the Holder,
 satisfactory acknowledgments of the Guarantor's continued liability hereunder.

          12. RECEIPT AND EXAMINATION OF LOAN DOCUMENTS. The Guarantor hereby
 acknowledges that it has received and examined copies of the Loan Documents,
 the observance and performance of which by the Company are hereby guaranteed.

          13. NOTICES. Any notice or demand to be given or served hereunder
 shall be in writing and personally delivered, or sent by registered or
 certified mail addressed as follows:

               To FHB at:            First Hawaiian Bank
                                     999 Bishop Street
                                     Honolulu, Hawaii 96813
                                     Attention: Danford H. Oshima
                                                Vice President Corporate
                                                Banking Division
                                     FAX: (808) 525-7173

               To GUARANTOR at:      371 Aokea Street
                                     Honolulu, Hawaii 96819
                                     Attention: Executive Vice President-Finance
                                                & Planning and Chief Financial
                                                Officer
                                     FAX: (808) 833-3100

 Any such address may be changed from time to time by the addressee by serving
 notice to the other party as above provided. Service of such notice or demand
 shall be deemed complete on the date of actual delivery or at the expiration of
 the second day after the date of mailing if mailed in Hawaii, whichever is
 earlier.

          14. PARTIES IN INTEREST. All covenants, agreements, terms and
 conditions in this Guaranty contained shall be binding on the Guarantor and the
 Guarantor's successors and assigns, and shall bind, inure to the benefit of and
 be enforceable by the Holder from time to time.

          15. GOVERNING LAW; SEVERABILITY. This Guaranty shall for all purposes
 be construed in accordance with the laws of the State of Hawaii. The Guarantor
 hereby irrevocably and

                                       -6-


<PAGE>


 unconditionally submits, for purposes of any action or proceeding which the
 Holder may bring to enforce this Guaranty, to the jurisdiction of the courts of
 the State of Hawaii and the Federal District Court for the District of Hawaii.
 The submission to such jurisdiction shall not prevent the Holder from
 commencing any such action or proceeding in any other court having
 jurisdiction. If any provision of this Guaranty is held to be invalid or
 unenforceable, the validity or enforceability of the other provision shall
 remain unaffected.

          16. TERMS OF THIS GUARANTY SUPERCEDE ANY OTHER GUARANTY. The Guarantor
 hereby acknowledges and agrees that the terms, covenants, conditions and
 provisions contained in this Guaranty supercede the terms, covenants,
 conditions and provisions contained in the "Guarantee of Aloha Airlines"
 endorsed on the Notes, and that the guarantee obligations of the Guarantor with
 respect to FHB shall be governed exclusively by the terms, covenants,
 conditions and provisions contained in this Guaranty.

          17. PARAGRAPH HEADINGS. The headings of paragraphs herein are inserted
 only for convenience and shall in no way define, describe or limit the scope or
 intent of any provision of this Guaranty.

          18. TERMINATION. This Guaranty shall terminate upon the payment of all
 amounts due under the Loan Documents; provided, however, that if all or any
 portion of the amounts due under the Loan Documents are paid by or on behalf of
 the Company, the obligations of the Guarantor hereunder shall continue and
 remain in full force and effect in the event that all or any part of such
 payment is avoided or recovered directly or indirectly from the Holder as a
 preference, fraudulent transfer or otherwise in any bankruptcy, reorganization
 or insolvency proceeding of or against the Company.

          IN WITNESS WHEREOF, the Guarantor has executed this instrument as of
 September 8, 2000.

                                         ALOHA AIRLINES, INC.


                                         By   /s/ Glenn R. Zander
                                              ----------------------------
                                              Glenn R. Zander
                                              Its President and CEO

                                         By   /s/ Brenda F. Cutwright
                                              ----------------------------
                                              Brenda F. Cutwright
                                              Its EVP, CFO and Treasurer




                                      -7-



<PAGE>

                                LIMITED GUARANTY
                         (Sheridan Ing Partners Hawaii)

          WHEREAS, ALOHA AIRGROUP, INC., a Hawaii corporation (the "Company"),
 has issued 20,000 shares of Series C 10% Exchangeable Preferred Stock (the
 "Preferred Shares") to BancWest Corporation, a Delaware corporation, pursuant
 to the terms and provisions of that certain Purchase Agreement dated as of
 September 8, 2000 (the "Purchase Agreement"); and

          WHEREAS, the Purchase Agreement provides that the Preferred Shares
 will be exchangeable, at the Company's option into Senior Secured Guaranteed
 Floating Rate Notes (the "Notes") at $1,000 for each Preferred Share; and

          WHEREAS, the Company has exercised its option to exchange the
 Preferred Shares held by BancWest Corporation into the Notes; and

          WHEREAS, BancWest Corporation has agreed to sell and assign the Notes
 to First Hawaiian Bank, a Hawaii corporation ("FHB"), and FHB has agreed to
 purchase and accept an assignment of the Notes, upon the terms and conditions
 set forth in that certain Loan Agreement dated September 8, 2000 (the "Loan
 Agreement"), but subject to the condition, among others, that SHERIDAN ING
 PARTNERS HAWAII, a Hawaii limited partnership (the "Limited Guarantor") execute
 and deliver this Limited Guaranty to FHB; and

          WHEREAS, the Limited Guarantor deems it to be to its own financial
 benefit that FHB purchase and accept an assignment of the Notes; and

          WHEREAS, in addition to purchasing the Notes, FHB and certain
 additional lenders (the "Lenders") have made available to Aloha Airlines, Inc.,
 a Delaware corporation (the "Airline"), a revolving line of credit in the
 principal amount of $30,000,000 (the "Line of Credit") in accordance with that
 certain Amended and Restated Loan Agreement - 1996 dated December 31, 1996, as
 amended, which will be further amended pursuant to that certain Fifth Amendment
 to Amended and Restated Loan Documents dated September 8, 2000 (the "Line of
 Credit Agreement") to, among other matters, reduce the commitment thereunder
 to $20,000,000; and

          WHEREAS, the Limited Guarantor deems it to be to its own financial
 benefit that the Lenders enter into said Fifth Amendment to Amended and
 Restated Loan Documents;

          NOW, THEREFORE, in consideration of FHB's agreement to purchase and
 accept an assignment of the Notes, and in consideration of the Lenders'
 agreement to enter into said fifth Amendment to Amended and Restated Loan
 Documents, as described above, the Limited Guarantor hereby agrees as follows:

          1. GUARANTY; AMOUNT GUARANTEED. The Limited Guarantor hereby
 unconditionally and irrevocably, guarantees to FHB, and to each holder of any
 interest in the Notes, and to each participant in the Line of Credit (each
 holder of any interest in the Notes, and each participant in the Line of
 Credit, being hereinafter collectively and individually called the "Holder"),
 that (a) if the Company fails to pay any amounts of principal or interest under
 the Notes as and when the same become due and payable, whether at maturity, by
 acceleration or otherwise, or (b) if the Airline fails to pay any amounts of
 principal or interest under the Line of Credit as and when the same become


<PAGE>


 due and payable, whether at maturity, by acceleration or otherwise, or (c) if
 the Company or the Airline undertakes or suffers any "Bankruptcy Action" (as
 hereinafter defined), THEN, AND IN ANY SUCH EVENT, the Limited Guarantor will
 pay to the Holder, promptly after demand therefor, all amounts outstanding
 under the Notes and all amounts outstanding under the Line of Credit,
 regardless of any defense or setoff or counterclaim which the Company or the
 Airline may have or assert, and regardless of whether or not any Holder or
 anyone on behalf of such Holder shall have instituted any suit, action or
 proceeding or exhausted its remedies or taken any steps to collect all or part
 of any such amounts, whether at law or in equity, and regardless of any other
 condition or contingency; PROVIDED, HOWEVER, that notwithstanding anything
 contained in this Limited Guaranty to the contrary, the obligations of the
 Limited Guarantor hereunder shall in no event, circumstance or contingency ever
 exceed the sum of TWO MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
 ($2,500,000.00), hereinafter called the "Amount Guaranteed"; AND PROVIDED,
 FURTHER, HOWEVER, that notwithstanding the limitation on such obligations, FHB
 shall have the right, in its sole and absolute discretion, to allocate the
 Amount Guaranteed to the amounts due under the Notes (principal, interest, fees
 and charges) and/or to the amounts due under the Line of Credit (principal,
 interest, fees and charges) in any amounts and in any order chosen by FHB. This
 Limited Guaranty shall only become operational if (i) amounts under the Notes
 or the Line of Credit have become due and payable as a result of a payment
 default listed under Section 6.1 of the Loan Agreement or Section 7.1 of the
 Line of Credit Agreement, respectively, or (ii) the Company or the Airline
 undertakes or suffers any Bankruptcy Action. Notwithstanding anything in this
 Limited Guaranty to the contrary, any payment made by the Limited Guarantor to
 FHB under this Limited Guaranty, shall reduce the Amount Guaranteed on a
 "dollar for dollar" basis.

          As used herein, the term "Bankruptcy Action" shall mean any of the
 following: (i) if the Company or the Airline shall become insolvent, or make an
 assignment for the benefit of creditors, or become the subject of an order for
 relief in an involuntary case under the bankruptcy laws as now or hereafter
 constituted, and such order shall remain in effect and unstayed for a period of
 sixty (60) consecutive days, or (ii) the Company or the Airline shall commence
 a voluntary case under the bankruptcy laws as now or hereafter constituted, or
 shall file any petition or answer seeking for itself any arrangement,
 composition, adjustment, liquidation, dissolution or similar relief to which it
 may be entitled under any present or future statute, law or regulation, or file
 any answer admitting the material allegations of any petition filed against it
 in any such proceedings, or (iii) the company or the Airline shall seek or
 consent to or acquiesce in the appointment of or taking possession by, any
 custodian, trustee, receiver or liquidator of it or of all or a substantial
 part of its properties or assets, or take action looking to its dissolution or
 liquidation, or (iv) within sixty (60) days after commencement of any
 proceedings against the Company or the Airline seeking any arrangement,
 composition, adjustment, liquidation, dissolution or similar relief to which
 the Company or the Airline may be entitled under any present or future statute,
 law or regulation, such proceedings shall not have been dismissed; or (v)
 within sixty (60) days after the appointment of, or taking possession by, any
 custodian, trustee, receiver or liquidator of any or of all or a substantial
 part of the Company's or the Airline's properties or assets, without the
 consent or acquiescence of the Company or the Airline, any such appointment or
 possession shall not have been vacated or terminated.

         Notwithstanding the foregoing or anything herein to the  contrary,
 the benefits of this Limited Guaranty will not be available until the  Holder
 has made a written demand for payment on


                                      -2-
<PAGE>

 the Company, the Airline and all guarantors and the time period for payment in
 such demand has expired.

          2. TERM OF THIS LIMITED GUARANTY. This Limited Guaranty shall
 terminate on August 30, 2002 (the "Termination Date"), at 5:00 p.m., Hawaii
 Standard Time, unless extended by the mutual agreement of the Limited Guarantor
 and FHB; provided, however, that if all or any portion of the indebtedness
 under the Notes or the indebtedness under the Line of Credit is paid by or on
 behalf of the Company or the Airline on or before the Termination Date, the
 obligations of the Limited Guarantor hereunder shall continue and remain in
 fall force and effect in the event that all or any part of such payment is
 avoided or recovered directly or indirectly from the Holder as a preference,
 fraudulent transfer or otherwise in any bankruptcy, reorganization or
 insolvency proceeding of or against the Company or the Airline.

          3. WAIVER. The Limited Guarantor hereby unconditionally waives any and
 all statutory and common law suretyship defenses that now or hereafter may be
 available to the Limited Guarantor, including, without limitation (a) any
 requirement that any Holder in the event of any default by the Company or the
 Airline, except as otherwise set forth in this Limited Guaranty, first make
 demand upon, or seek to enforce remedies against, the Company or the Airline or
 any other guarantor or any security or collateral held by FHB at any time, or
 to pursue any other remedy in its power, before being entitled to payment from
 the Limited Guarantor of the amounts payable by the Limited Guarantor
 hereunder, up to the Amount Guaranteed, or before proceeding against the
 Limited Guarantor; (b) any defense that may arise by reason of (i) the
 revocation or repudiation of this Limited Guaranty by the Limited Guarantor, or
 the revocation or repudiation of any loan documents by the Company or the
 Airline or any other person or entity, (ii) the failure of FHB to file or
 enforce a claim against the estate (either in administration, bankruptcy or any
 other proceeding) of the Company or the Airline or any other person or entity,
 or (iii) the invalidity, irregularity or unenforceability in whole or in part
 of the Notes or any document, instrument, or agreement executed by the Company
 or the Airline in connection with the Notes or the Line of Credit, or any
 limitation on the liability of the Company or the Airline thereunder, or any
 limitation on the method or terms of payment thereunder, which may now or
 hereafter be caused or imposed in any manner whatsoever; (c) diligence,
 presentment, demand for payment, protest, notice of discharge, notice of
 acceptance of this Limited Guaranty, and indulgences and notices of any other
 kind whatsoever; (d) any defense based upon an election of remedies (including,
 if available, an election to proceed by non-judicial foreclosure) by FHB which
 destroys or otherwise impairs any subrogation rights of the Limited Guarantor
 or the right of the Limited Guarantor to proceed against the Company or the
 Airline for reimbursement, or both; (e) any defense based upon any taking,
 modification or release of any collateral or guaranties for the indebtedness of
 the Company under the Notes or the Airline under the Line of Credit, or any
 failure to perfect any security interest in, or the taking of any other action
 or the failure to take any other action with respect to any collateral securing
 the payment of such indebtedness; (f) any rights or defenses based upon an
 offset by the Limited Guarantor, against any obligation now or hereafter owed
 to the Limited Guarantor, by the Company or the Airline, including, without
 limitation, any Senior Secured Guaranteed Floating Rate Notes held by the
 Limited Guarantor; or (g) any right of appraisement with regard to the value of
 any collateral which FHB may apply as a credit to the obligations of the
 Company or the Airline, through foreclosure or otherwise, and agree that the
 determination by an independent appraiser appointed by FHB of the value of such
 collateral shall be binding upon the Limited Guarantor for all purposes; it
 being the


                                      -3-
<PAGE>

 intention hereof that the Limited Guarantor shall remain fully liable, as
 principal, for the Amount Guaranteed, until the full payment of the
 indebtedness under the Notes and the full payment of the indebtedness under the
 Line of Credit, subject to the termination provisions of Paragraph 2 hereof,
 notwithstanding any act, omission or thing which might otherwise operate as a
 legal or equitable discharge of the Limited Guarantor.

          4. NO RELEASE OF GUARANTY. The obligations, covenants, agreements and
 duties of the Limited Guarantor under this Limited Guaranty shall not be
 released, affected, stayed or impaired, without the written consent of the
 Holder, by (a) any assignment, endorsement or transfer, in whole or in part, of
 the Notes or any interest in the Line of Credit, although made without notice
 to or the consent of the Limited Guarantor; or (b) any waiver by the Holder of
 the performance or observance by the Company, the Airline or the Limited
 Guarantor of any of the agreements, covenants, terms or conditions contained in
 any loan documents executed by any of them in connection with the Notes or the
 Line of Credit; or (c) any extension of the time for payment of any amounts
 payable under or in connection with the Notes of the Line of Credit or any
 renewal thereof; or (d) the modification or amendment (whether material or
 otherwise) of any duty, agreement or obligation of the Company or the Airline
 under the Notes or the Line of Credit; or (e) the voluntary or involuntary
 liquidation, sale or other disposition of all or substantially all of the
 assets of the Company, the Airline or any of the Limited Guarantor; or (f) any
 receivership, insolvency, bankruptcy, reorganization, dissolution or other
 similar proceedings, affecting the Company, the Airline or any of the Limited
 Guarantor or any of their assets; or (g) any release of any property from
 securing payment of the Notes or the Line of Credit or the acceptance of
 additional or substitute property as security therefor; or (h) the release or
 discharge of the Company or the Airline from the observance or performance of
 any agreement, covenant, term or condition contained in any loan documents
 executed by either of them in connection with the Notes or the Line of Credit;
 or (i) any action which the Holder may take or omit to take by virtue of such
 loan documents or through any course of dealing with the Company or the
 Airline; or (j) the addition of a new guarantor or guarantors (the Limited
 Guarantor acknowledging that Aloha Airlines, Inc., will be providing a full
 guaranty to FHB with respect to the Company's obligations under the Notes, but
 that the Holder has no obligation to seek to enforce any remedies against Aloha
 Airlines, Inc., before being entitled to payment from the Limited Guarantor of
 the entire Amount Guaranteed hereunder); or (k) any change in the status or
 structure of the Company or the Airline, including any change by incorporation,
 merger or consolidation; (l) any change in the composition of the Company or
 the Airline, including, without limitation, any addition of, removal of,
 replacement for or substitution of any officer or stockholder of the Company or
 the Airline; or (m) the operation of law or any other cause, whether similar or
 dissimilar to the foregoing, PROVIDED, HOWEVER, that notwithstanding the
 foregoing, no such waiver, extension, modification or amendment shall without
 the consent of the Limited Guarantor increase the principal amount of the Notes
 or the Line of Credit, or increase the interest rate payable thereon, or
 increase any premium payable upon redemption thereof, or shorten the stated
 maturity thereof, except in accordance with the express provisions of the loan
 documents executed by the Company or the Airline in connection with the Notes
 and the Line of Credit; AND PROVIDED FURTHER that nothing contained in this
 Paragraph 4 shall affect the limitations on the obligations of the Limited
 Guarantor set forth in Paragraph 1 hereof (relating to the Amount Guaranteed)
 and in Paragraph 2 hereof (relating to the Termination Date).


                                      -4-
<PAGE>

          5. WAIVER OF SUBROGATION. The Limited Guarantor hereby waives any and
 all right the Limited Guarantor may have to be subrogated to the right of the
 Holder to receive payments or distributions of assets of the Company or the
 Airline following any payment made by the Limited Guarantor, on this Limited
 Guaranty, unless and until all amounts payable under the Notes have been paid
 and all other amounts payable under this Limited Guaranty shall have been paid
 in full, the Line of Credit shall have expired or been terminated, and the
 Holder shall have received an opinion from counsel to the Limited Guarantor,
 acceptable to the Holder that the payment of all amounts due under the Notes
 and the Line of Credit does not constitute a payment which may be avoided or
 recovered directly or indirectly from the Holder as a preference, fraudulent
 transfer or otherwise in any bankruptcy, reorganization or insolvency
 proceeding of or against the Company or the Airline. If (i) the Limited
 Guarantor shall make payment to any Holder under this Limited Guaranty, (ii)
 all amounts under the Notes and any amounts payable under this Limited Guaranty
 shall have been paid in full, (iii) the maturity date of the Notes shall have
 occurred, and the commitment of the Company under the Line of Credit shall have
 been terminated, and (iv) the Holder shall have received an opinion from
 counsel to the Limited Guarantor, acceptable to the Holder that the payment of
 all amounts due under the Notes and the Line of Credit does not constitute a
 payment which may be avoided or recovered directly or indirectly from the
 Holder as a preference, fraudulent transfer or otherwise in any bankruptcy,
 reorganization or insolvency proceeding of or against the Company or the
 Airline, the Holders will, at the Limited Guarantor's request and expense,
 execute and deliver to the Limited Guarantor appropriate documents, necessary
 to evidence the transfer by subrogation to the Limited Guarantor of an interest
 resulting from such payment made by such Limited Guarantor pursuant to this
 Limited Guaranty.

          6. SUBORDINATION OF INDEBTEDNESS; BANKRUPTCY OF COMPANY. Any
 indebtedness of the Company or the Airline now or hereafter held by the Limited
 Guarantor (including, without limitation, any Senior Secured Guaranteed
 Floating Rate Note held by the Limited Guarantor), is hereby subordinated to
 the indebtedness of the Company and the Airline to the Holder; and, upon the
 request of the Holder, such indebtedness of the Company or the Airline to the
 Limited Guarantor shall be collected, enforced and received by the Limited
 Guarantor as trustee for the holder and shall be paid over to the holder on
 account of the indebtedness of the Company and the Airline to the Holder
 without reducing or affecting in any manner the liability of the Limited
 Guarantor under the other provisions of this Limited Guaranty.

          7. CLAIMS IN BANKRUPTCY. The Limited Guarantor will file all claims
 against the Company and/or the Airline in any bankruptcy or other proceeding in
 which the filing of claims is required or permitted by law upon any
 indebtedness of the Company or the Airline to the Limited Guarantor or claim
 against the Company or the Airline by the Limited Guarantor, and the Limited
 Guarantor hereby assigns to FHB all rights of the Limited Guarantor thereunder.
 If the Limited Guarantor does not file any such claim, FHB, as attorney-in-fact
 for the Limited Guarantor, is hereby authorized to do so in the name of the
 Limited Guarantor or, in FHB's discretion, to assign the claim and to cause
 proof of claim to be filed in the name of FHB's nominee. FHB or its nominee
 shall have the sole right (as assignee of all rights of the Limited Guarantor
 pursuant to this Section 7) to accept or reject any plan proposed in such
 proceeding and to take any other action which a party filing a claim is
 entitled to take. In all such cases, whether in administration, bankruptcy or
 otherwise, the person or persons authorized to pay such claim shall pay to FHB
 the full amount payable on such claim up to the amounts due under this Limited
 Guaranty, and, to the full extent


                                      -5-
<PAGE>

 necessary for that purpose, the Limited Guarantor hereby assigns to FHB all of
 the Limited Guarantor's rights to any such payments or distributions to which
 the Limited Guarantor would otherwise be entitled; provided, however, that the
 Limited Guarantor's obligations hereunder shall not be satisfied except to the
 extent that FHB receives cash by reason of any such payment or distribution. If
 FHB receives anything hereunder other than cash, the same shall be held as
 collateral for the payment of all amounts due under this Limited Guaranty.

          8. LITIGATION; CHANGE IN LIMITED GUARANTOR'S FINANCIAL CONDITION. The
 Limited Guarantor will promptly notify FHB of any litigation to which the
 Limited Guarantor becomes a party which is not covered by insurance, and any
 adverse change in the Limited Guarantor's financial condition, either of which
 might materially impair or diminish the value of this Limited Guaranty to the
 Holder as an assurance of the repayment of the indebtedness of the Company or
 the Airline to the Holder. The Limited Guarantor shall promptly furnish the
 Holder with such information, financial or otherwise, as the Holder may from
 time to time reasonably request concerning the Limited Guarantor.

          9. CONDITION OF COMPANY AND AIRLINE. The Limited Guarantor is fully
 aware of the financial condition of the Company and the Airline and is
 executing and delivering this Limited Guaranty based solely upon the Limited
 Guarantor's own independent investigation of all matters pertinent hereto, and
 is not relying in any manner upon any representation or statement of FHB. The
 Limited Guarantor represents and warrants that the Limited Guarantor is in a
 position to obtain and the Limited Guarantor hereby assumes full responsibility
 for obtaining, any additional information concerning the Company's and the
 Airline's financial condition and any other matter pertinent hereto as the
 Limited Guarantor may desire, and the Limited Guarantor is not relying upon or
 expecting FHB to furnish to the Limited Guarantor any information now or
 hereafter in FHB's possession concerning the same or any other matter. By
 executing this Limited Guaranty, the Limited Guarantor knowingly acknowledges
 and accepts the full range of risks encompassed within a contract of this type.
 The Limited Guarantor shall have no right to require FHB to obtain or disclose
 any information with respect to the indebtedness under the Notes or the Line of
 Credit, the financial condition or character of the Company or the Airline, the
 Company's or the Airline's ability to pay such indebtedness, the existence of
 any collateral or security for any or all of such indebtedness, the existence
 or non-existence of any other guaranties of all or any part of such
 indebtedness, or any action or non-action on the part of FHB, the Company, the
 Airline, or any other person, or any other matter, fact or occurrence
 whatsoever.

          10.      FINANCIAL COVENANT; NEGATIVE COVENANTS.

                   (a) The Limited Guarantor shall at all times herein maintain
 a minimum "Net Worth" of at least $5,000,000.00. As used herein, the term "Net
 Worth" shall mean the excess of the Limited Guarantor's total assets over the
 Limited Guarantor's total liabilities, as determined in accordance with
 accounting principles consistently applied by the Limited Guarantor and as set
 forth in the financial statements dated December 31, 1999, previously delivered
 to the Lender.

                   (b) As soon as available, but not later than one hundred
 twenty (120) days after the end of each fiscal year, the Limited Guarantor
 shall provide to the Lender financial statements of the Limited Guarantor,
 which are acceptable to the Lender.



                                      -6-
<PAGE>


                  (c) At all times herein, the Limited Guarantor shall not,
 without the prior written consent of FHB, (i) directly or indirectly make or
 commit to make any loan, advance, guaranty or extension of credit to any
 corporation, association, partnership, organization or individual affiliated
 with the Limited Guarantor; or (ii) sell, transfer, hypothecate, assign or
 convey any asset, or interest therein, of the Limited Guarantor; except in the
 ordinary course of the Limited Guarantor's business.

          11. BANKRUPTCY. Until all indebtedness under the Notes and the Line of
 Credit has been paid to the Holder, or the Termination Date, whichever occurs
 first, the Limited Guarantor shall not, without the prior written consent of
 the Holder, commence or join with any other person in commencing any
 bankruptcy, reorganization or insolvency proceedings of or against the Company
 or the Airline. The obligations of the Limited Guarantor under this Limited
 Guaranty shall not be altered, limited or affected by any proceeding, voluntary
 or involuntary, involving the bankruptcy, insolvency, receivership,
 reorganization, liquidation or arrangement of the Company or the Airline, or by
 any defense which the Company or the Airline may have by reason of the order,
 decree or decision of any court or administrative body resulting from any such
 proceeding. The Limited Guarantor acknowledges and agrees that any interest on
 the indebtedness under the Notes or the Line of Credit which accrues after the
 commencement of any such proceeding (or, if interest on any portion of such
 indebtedness ceases to accrue by operation of law by reason of the commencement
 of said proceeding, such interest as would have accrued on any such portion of
 such indebtedness if said proceeding had not been commenced) shall be included
 in the indebtedness guaranteed by the Limited Guarantor hereunder, since it is
 the intention of the parties that the amount of the indebtedness which is
 guaranteed by the Limited Guarantor pursuant to this Limited Guaranty should be
 determined without regard to any rule of law or order which may relieve the
 Company or the Airline of any portion of such indebtedness. The Limited
 Guarantor will permit any trustee in bankruptcy, receiver, debtor in
 possession, assignee for the benefit of creditors or similar person to pay to
 the Holder, or allow the claim of the Holder in respect of, any such interest
 accruing after the date on which such proceeding is commenced.

          12.     REPRESENTATIONS AND WARRANTIES.

                  (a) ORGANIZATION, STANDING AND AUTHORITY OF LIMITED GUARANTOR.
 The Limited Guarantor is a Hawaii limited partnership, duly registered, validly
 existing and in good standing under the laws of the State of Hawaii, and has
 all requisite power and authority to carry on the business and to own the
 property that it now carries on and owns. The Limited Guarantor has all
 requisite power and authority to execute and deliver this Limited Guaranty and
 to observe and perform all of the provisions and conditions hereof. The
 execution and delivery of this Limited Guaranty have been duly authorized by
 the general partners of the Limited Guarantor, and no other partnership action
 of the Limited Guarantor is requisite to the execution and delivery of this
 Limited Guaranty.

                  (b) TAX RETURNS AND PAYMENTS. All tax returns and reports of
 the Limited Guarantor required by law to be filed have been duly filed, and all
 taxes, assessments, contributions, fees and other governmental charges (other
 than those presently payable without penalty or interest and those which have
 been disclosed to the Lender but which are currently being contested in good
 faith) upon the Limited Guarantor, or upon its properties or assets or income,
 which are due and payable, have been paid.


                                      -7-
<PAGE>

                  (c) LITIGATION. There is, to the knowledge of the Limited
 Guarantor, no action, suit, proceeding or investigation pending at law or in
 equity or before any federal, state, territorial, municipal or other
 governmental department, commission, board, bureau, agency or instrumentality
 or threatened against or affecting the Limited Guarantor, which might
 materially adversely affect the Limited Guarantor's ability to perform its
 obligations under this Limited Guaranty.

                  (d) LIMITED GUARANTOR'S COMPLIANCE WITH OTHER INSTRUMENTS,
 NONE BURDENSOME. The Limited Guarantor is not in violation of or in default
 with respect to any term or provision of its Partnership Agreement or any
 material mortgage, indenture, contract, agreement or instrument applicable to
 the Limited Guarantor or by which it may be bound; and the execution, delivery,
 performance of and compliance with this Limited Guaranty will not result in any
 such violation or be in conflict with or constitute a default under any such
 term or provision or result in the creation of any mortgage, lien or charge on
 any of the properties or assets of the Limited Guarantor not contemplated by
 this Limited Guaranty; and there is no term or provision of its Partnership
 Agreement, or any mortgage, indenture, contract, agreement or instrument
 applicable to the Limited Guarantor or by which it may be bound, which may
 materially adversely affect the business or prospects or condition (financial
 or other) of the Limited Guarantor or of any of its properties or assets.

                  (e) FINANCIAL STATEMENTS. All financial statements heretofore
 delivered to the Lender by the Limited Guarantor are true and correct in all
 respects, and fairly represent the financial condition of the Limited Guarantor
 as of the dates thereof; and no material, adverse changes have occurred in the
 financial condition reflected therein since the respective dates thereof to the
 Closing Date.

                  (f) CHARACTER OF REPRESENTATIONS AND WARRANTIES. None of the
 financial statements or any certificate or statement furnished to the Lender by
 or on behalf of the Limited Guarantor in connection with the Loan, and none of
 the representations and warranties in this Limited Guaranty, contains any
 untrue statement of a material fact or omits to state a material fact necessary
 in order to make the statements contained therein or herein not misleading. To
 the best knowledge of the Limited Guarantor, there is no fact which materially
 adversely affects or in the future (so far as the Limited Guarantor can now
 foresee) may materially adversely affect the ability of the Limited Guarantor
 to observe or perform its obligations under this Limited Guaranty, which has
 not been set forth herein or in a certificate or opinion of counsel or other
 written statement furnished to the Lender by or on behalf of the Limited
 Guarantor.

          13. REMEDIES, CUMULATIVE. The rights and remedies of the Holder
 hereunder and under all documents, instruments and agreements executed by or
 for the benefit of the company or the Airline in connection with the Notes or
 the Line of Credit are cumulative and not exclusive and may be exercised in
 whole or in part and in any order and at any time or times as the Holder shall
 determine. All security of any kind or nature received or receivable by the
 Holder for the repayment of the indebtedness under the Notes or the Line of
 Credit may be applied in any manner or order determined by the Holder.

          14. AMENDMENTS; CONTINUING LIABILITY. The terms of this Limited
 Guaranty may not be modified or amended except by a written agreement executed
 by the Limited Guarantor with the


                                      -8-
<PAGE>

 consent in writing of the Holder. The obligations of the Limited Guarantor
 under this Limited Guaranty shall be continuing obligations and a separate
 cause of action shall be deemed to arise in respect of each default hereunder.

          15. RECEIPT AND EXAMINATION OF NOTES AND OTHER DOCUMENTS. The Limited
 Guarantor hereby acknowledges that it has received and examined copies of the
 Notes, and all other documents, instruments and agreements executed by or for
 the benefit of the Company or the Airline in connection with the Notes or the
 Line of Credit.

          16. NOTICES. Any notice or demand to be given or served hereunder
 shall be in writing and personally delivered, or sent by registered or
 certified mail addressed as follows:

          To FHB at:       First Hawaiian Bank
                           999 Bishop Street
                           Honolulu, Hawaii 96813
                           Attention: Danford H. Oshima
                                      Vice President, Corporate Banking Division
                                      Fax: (808) 525-7173

          To LIMITED GUARANTOR at:
                          841 Bishop Street, Suite 860
                          Honolulu, Hawaii 96813
                          Attention: Richard Ing

 Any such address may be changed from time to time by the addressee by serving
 notice to the other party as above provided. Service of such notice or demand
 shall be deemed complete on the date of actual delivery or at the expiration of
 the second day after the date of mailing if mailed in Hawaii, whichever is
 earlier.

          17. PARTIES IN INTEREST. All covenants, agreements, terms and
 conditions in this Limited Guaranty contained shall be binding on the Limited
 Guarantor and its successors, successors in trust, and assigns, and shall bind,
 inure to the benefit of and be enforceable by the Holder from time to time.

          18. GOVERNING LAW; SEVERABILITY. This Limited Guaranty shall for all
 purposes be construed in accordance with the laws of the State of Hawaii. The
 Limited Guarantor hereby irrevocably and unconditionally submits, for purposes
 of any action or proceeding which the Holder may bring to enforce this Limited
 Guaranty, to the jurisdiction of the courts of the State of Hawaii and the
 Federal District Court for the District of Hawaii. The submission to such
 jurisdiction shall not prevent the Holder from commencing any such action or
 proceeding in any other court having jurisdiction. If any provision of this
 Limited Guaranty is held to be invalid or unenforceable, the validity or
 enforceability of the other provision shall remain unaffected.

          19. PARAGRAPH HEADINGS. The headings of paragraphs herein are inserted
 only for convenience and shall in no way define, describe or limit the scope or
 intent of any provision of this Limited Guaranty.


                                      -9-
<PAGE>

          IN WITNESS WHEREOF, the Limited Guarantor has executed this instrument
as of September 8, 2000.

                          SHERIDAN ING PARTNERS HAWAII

                          By /s/ Louise K.Y. Ing
                             ----------------------------------
                                 Louise K.Y. Ing
                                 Co-Trustee of the Sheridan Ing FLP Trust
                                 Its General Partner

                          By /s/ Richard K.M. Ing
                             ----------------------------------
                                 Richard K.M. Ing
                                 Co-Trustee of the Sheridan Ing FLP Trust
                                 Its General Partner


                                 -10-



<PAGE>

                                LIMITED GUARANTY
                     (Aloha Securities & Investment Company)

         WHEREAS, ALOHA AIRGROUP, INC., a Hawaii corporation (the "Company"),
has issued 20,000 shares of Series C 10% Exchangeable Preferred Stock (the
"Preferred Shares") to BancWest Corporation, a Delaware corporation, pursuant
to the terms and provisions of that certain Purchase Agreement dated as of
September 8, 2000 (the "Purchase Agreement"); and

         WHEREAS, the Purchase Agreement provides that the Preferred Shares
will be exchangeable, at the Company's option, into Senior Secured Guaranteed
Floating Rate Notes (the "Notes") at $1,000 for each Preferred Share; and

         WHEREAS, the Company has exercised its option to exchange the
Preferred Shares held by BancWest Corporation into the Notes; and

         WHEREAS, BancWest Corporation has agreed to sell and assign the Notes
to First Hawaiian Bank, a Hawaii corporation ("FHB"), and FHB has agreed to
purchase and accept an assignment of the Notes, upon the terms and conditions
set forth in that certain Loan Agreement dated September 8, 2000 (the "Loan
Agreement"), but subject to the condition, among others, that ALOHA SECURITIES
& INVESTMENT COMPANY, a Hawaii limited partnership (the "Limited Guarantor")
execute and deliver this Limited Guaranty to FHB; and

         WHEREAS, the Limited Guarantor deems it to be to its own financial
benefit that FHB purchase and accept an assignment of the Notes; and

         WHEREAS, in addition to purchasing the Notes, FHB and certain
additional lenders (the "Lenders") have made available to Aloha Airlines, Inc.,
a Delaware corporation (the "Airline"), a revolving line of credit in the
principal amount of $30,000,000 (the "Line of Credit"), in accordance with
that certain Amended and Restated Loan Agreement - 1996 dated December 31,
1996, as amended, which will be further amended pursuant to that certain Fifth
Amendment to Amended and Restated Loan Documents dated September 8, 2000 (the
"Line of Credit Agreement") to, among other matters, reduce the commitment
thereunder to $20,000,000; and

         WHEREAS, the Limited Guarantor deems it to be to its own financial
benefit that the Lenders enter into said Fifth Amendment to Amended and
Restated Loan Documents;

         NOW, THEREFORE, in consideration of FHB's agreement to purchase and
accept an assignment of the Notes, and in consideration of the Lenders'
agreement to enter into said Fifth Amendment to Amended and Restated Loan
Documents, as described above, the Limited Guarantor hereby agrees as follows:

         1. GUARANTY; AMOUNT GUARANTEED. The Limited Guarantor hereby
unconditionally and irrevocably, guarantees to FHB, and to each holder of any
interest in the Notes, and to each participant in the Line of Credit (each
holder of any interest in the Notes, and each participant in the Line of
Credit, being hereinafter collectively and individually called the "Holder"),
that (a) if the Company fails to pay any amounts of principal or interest under
the Notes as and when the same become due and payable, whether at maturity, by
acceleration or otherwise, or (b) if the Airline fails to pay any amounts of
principal or interest under the Line of Credit as and when the same become


<PAGE>

due and payable, whether at maturity, by acceleration or otherwise, or (c) if
the Company or the Airline undertakes or suffers any "Bankruptcy Action" (as
hereinafter defined), THEN, AND IN ANY SUCH EVENT, the Limited Guarantor will
pay to the Holder, promptly after demand therefor, all amounts outstanding
under the Notes and all amounts outstanding under the Line of Credit,
regardless of any defense or setoff or counterclaim which the Company or the
Airline may have or assert, and regardless of whether or not any Holder or
anyone on behalf of such Holder shall have instituted any suit, action or
proceeding or exhausted its remedies or taken any steps to collect all or part
of any such amounts, whether at law or in equity, and regardless of any other
condition or contingency; PROVIDED, HOWEVER, that notwithstanding anything
contained in this Limited Guaranty to the contrary, the obligations of the
Limited Guarantor hereunder shall in no event, circumstance or contingency ever
exceed the sum of SEVEN MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($7,500,000.00), hereinafter called the "Amount Guaranteed"; AND PROVIDED,
FURTHER, HOWEVER, that notwithstanding the limitation on such obligations, FHB
shall have the right, in its sole and absolute discretion, to allocate the
Amount Guaranteed to the amounts due under the Notes (principal, interest, fees
and charges) and/or to the amounts due under the Line of Credit (principal,
interest, fees and charges) in any amounts and in any order chosen by FHB. This
Limited Guaranty shall only become operational if (i) amounts under the Notes
or the Line of Credit have become due and payable as a result of a payment
default listed under Section 6.1 of the Loan Agreement or Section 7.1 of the
Line of Credit Agreement, respectively, or (ii) the Company or THE Airline
undertakes or suffers any Bankruptcy Action.

         As used herein, the term "Bankruptcy Action" shall mean any of the
following: (i) if the Company or the Airline shall become insolvent, or make an
assignment for the benefit of creditors, or become the subject of an order for
relief in an involuntary case under the bankruptcy laws as now or hereafter
constituted, and such order shall remain in effect and unstayed for a period of
sixty (60) consecutive days, or (ii) the Company or the Airline shall commence
a voluntary case under the bankruptcy laws as now or hereafter constituted, or
shall file any petition or answer seeking for itself any arrangement,
composition, adjustment, liquidation, dissolution or similar relief to which it
may be entitled under any present or future statute, law or regulation, or file
any answer admitting the material allegations of any petition filed against it
in any such proceedings, or (iii) the company or the Airline shall seek or
consent to or acquiesce in the appointment of or taking possession by, any
custodian, trustee, receiver or liquidator of it or of all or a substantial
part of its properties or assets, or take action looking to its dissolution. or
liquidation, or (iv) within sixty (60) days after commencement of any
proceedings against the Company or the Airline seeking any arrangement,
composition, adjustment, liquidation, dissolution or similar relief to which
the Company or the Airline may be entitled under any present or future statute,
law or regulation, such proceedings shall not have been dismissed; or (v)
within sixty (60) days after the appointment of, or taking possession by, any
custodian, trustee, receiver or liquidator of any or of all or a substantial
part of the Company's or the Airline's properties or assets, without the
consent or acquiescence of the Company or the Airline, any such appointment or
possession shall not have been vacated or terminated.

         Notwithstanding the foregoing or anything herein to the contrary, the
benefits of this Limited Guaranty will not be available until the Holder has
made a written demand for payment on the Company, the Airline and all
guarantors, and the time period for payment in such demand has lapsed.


                                      -2-
<PAGE>

          2. TERM OF THIS LIMITED GUARANTY. This Limited Guaranty shall
terminate on August 30, 2002 (the "Termination Date"), at 5:00 p.m., Hawaii
Standard Time, unless extended by the mutual agreement of the Limited Guarantor
and FHB; provided, however, that if all or any portion of the indebtedness
under the Notes or the indebtedness under the Line of Credit is paid by or on
behalf of the Company or the Airline on or before the Termination Date, the
obligations of the Limited Guarantor hereunder shall continue and remain in
full force and effect in the event that all or any part of such payment is
avoided or recovered directly or indirectly from the Holder as a preference,
fraudulent transfer or otherwise in any bankruptcy, reorganization or
insolvency proceeding of or against the Company or the Airline.

         3. WAIVER. The Limited Guarantor hereby unconditionally waives any and
all statutory and common law suretyship defenses that now or hereafter may be
available to the Limited Guarantor, including, without limitation (a) any
requirement that any Holder in the event of any default by the Company or the
Airline first make demand upon, or seek to enforce remedies against, the
Company or the Airline or any other guarantor or any security or collateral
held by FHB at any time, or to pursue any other remedy in its power, before
being entitled to payment from the Limited Guarantor of the amounts payable by
the Limited Guarantor hereunder, up to the Amount Guaranteed, or before
proceeding against the Limited Guarantor; (b) any defense that may arise by
reason of (i) the revocation or repudiation of this Limited Guaranty by the
Limited Guarantor, or the revocation or repudiation of any loan documents by
the Company or the Airline or any other person or entity, (ii) the failure of
FHB to file or enforce a claim against the estate (either in administration,
bankruptcy or any other proceeding) of the Company or the Airline or any other
person or entity, or (iii) the invalidity, irregularity or unenforceability in
whole or in part of the Notes or any document, instrument, or agreement
executed by the Company or the Airline in connection with the Notes or the Line
of Credit, or any limitation on the liability of the Company or the Airline
thereunder, or any limitation on the method or terms of payment thereunder,
which may now or hereafter be caused or imposed in any manner whatsoever; (c)
diligence, presentment, demand for payment, protest, notice of discharge,
notice of acceptance of this Limited Guaranty, and indulgences and notices of
any other kind whatsoever; (d) any defense based upon an election of remedies
(including, if available, an election to proceed by non-judicial foreclosure)
by FHB which destroys or otherwise impairs any subrogation rights of the
Limited Guarantor or the right of the Limited Guarantor to proceed against the
Company or the Airline for reimbursement, or both; (e) any defense based upon
any taking, modification or release of any collateral or guaranties for the
indebtedness of the Company under the Notes or the Airline under the Line of
Credit, or any failure to perfect any security interest in, or the taking of
any other action or the failure to take any other action with respect to any
collateral securing the payment of such indebtedness; (f) any rights or
defenses based upon an offset by the Limited Guarantor, against any obligation
now or hereafter owed to the Limited Guarantor, by the Company or the Airline,
including, without limitation, any Senior Secured Guaranteed Floating Rate
Notes held by the Limited Guarantor; or (g) any right of appraisement with
regard to the value of any collateral which FHB may apply as a credit to the
obligations of the Company or the Airline, through foreclosure or otherwise,
and agree that the determination by an independent appraiser appointed by FHB
of the value of such collateral shall be binding upon the Limited Guarantor for
all purposes; it being the intention hereof that the Limited Guarantor shall
remain fully liable, as principal, for the Amount Guaranteed, until the full
payment of the indebtedness under the Notes and the full payment of the
indebtedness under the Line of Credit, subject to the termination provisions of
Paragraph 2


                                      -3-
<PAGE>

hereof, notwithstanding any act, omission or thing which might otherwise
operate as a legal or equitable discharge of the Limited Guarantor.

         4. NO RELEASE OF GUARANTY. The obligations, covenants, agreements and
duties of the Limited Guarantor under this Limited Guaranty shall not be
released, affected, stayed or impaired, without the written consent of the
Holder, by (a) any assignment, indorsement or transfer, in whole or in part, of
the Notes or any interest in the Line of Credit, although made without notice
to or the consent of the Limited Guarantor; or (b) any waiver by the Holder of
the performance or observance by the Company, the Airline or the Limited
Guarantor of any of the agreements, covenants, terms or conditions contained in
any loan documents executed by any of them in connection with the Notes or the
Line of Credit; or (c) any extension of the time for payment of any amounts
payable under or in connection with the Notes of the Line of Credit or any
renewal thereof; or (d) the modification or amendment (whether material or
otherwise) of any duty, agreement or obligation of the Company or the Airline
under the Notes or the Line of Credit; or (e) the voluntary or involuntary
liquidation, sale or other disposition of all or substantially all of the
assets of the Company, the Airline or any of the Limited Guarantor; or (f) any
receivership, insolvency, bankruptcy, reorganization, dissolution or other
similar proceedings, affecting the Company, the Airline or any of the Limited
Guarantor or any of their assets; or (g) any release of any property from
securing payment of the Notes or the Line of Credit or the acceptance of
additional or substitute property as security therefor; or (h) the release or
discharge of the Company or the Airline from the observance or performance of
any agreement, covenant, term or condition contained in any loan documents
executed by either of them in connection with the Notes or the Line of Credit;
or (i) any action which the Holder may take or omit to take by virtue of such
loan documents or through any course of dealing with the Company or the
Airline; or (j) the addition of a new guarantor or guarantors (the Limited
Guarantor acknowledging that Aloha Airlines, Inc., will be providing a full
guaranty to FHB with respect to the Company's obligations under the Notes, but
that the Holder has no obligation to seek to enforce any remedies against Aloha
Airlines, Inc., before being entitled to payment from the Limited Guarantor of
the entire Amount Guaranteed hereunder); or (k) any change in the status or
structure of the Company or the Airline, including any change by incorporation,
merger or consolidation; (l) any change in the composition of the Company or
the Airline, including, without limitation, any addition of, removal of,
replacement for or substitution of any officer or stockholder of the company or
the Airline; or (m) the operation of law or any other cause, whether similar or
dissimilar to the foregoing, PROVIDED, HOWEVER, that notwithstanding the
foregoing, no such waiver, extension, modification or amendment shall without
the consent of the Limited Guarantor increase the principal amount of the Notes
or the Line of Credit, or increase the interest rate payable thereon, or
increase any premium payable upon redemption thereof, or shorten the stated
maturity thereof, except in accordance with the express provisions of the loan
documents executed by the Company or the Airline in connection with the Notes
and the Line of Credit; AND PROVIDED FURTHER that nothing contained in this
Paragraph 4 shall affect the limitations on the obligations of the Limited
Guarantor set forth in Paragraph 1 hereof (relating to the Amount Guaranteed)
and in Paragraph 2 hereof (relating to the Termination Date).

         5. WAIVER OF SUBROGATION. The Limited Guarantor hereby waives any and
all right the Limited Guarantor may have to be subrogated to the right of the
Holder to receive payments or distributions of assets of the Company or the
Airline following any payment made by the Limited Guarantor, on this Limited
Guaranty, unless and until all amounts payable under the Notes have been


                                      -4-
<PAGE>

paid and all other amounts payable under this Limited Guaranty shall have been
paid in full, the Line of Credit shall have expired or been terminated, and the
Holder shall have received an opinion from counsel to the Limited Guarantor,
acceptable to the Holder that the payment of all amounts due under the Notes
and the Line of Credit does not constitute a payment which may be avoided or
recovered directly or indirectly from the Holder as a preference, fraudulent
transfer or otherwise in any bankruptcy, reorganization or insolvency
proceeding of or against the Company or the Airline. If (i) the Limited
Guarantor shall make payment to any Holder under this Limited Guaranty, (ii)
all amounts under the Notes and any amounts payable under this Limited Guaranty
shall have been paid in full, (iii) the maturity date of the Notes shall have
occurred, and the commitment to the Company under the Line of Credit shall have
been terminated, and (iv) the Holder shall have received an opinion from
counsel to the Limited Guarantor, acceptable to the Holder that the payment of
all amounts due under the Notes and the Line of Credit does not constitute a
payment which may be avoided or recovered directly or indirectly from the
Holder as a preference, fraudulent transfer or otherwise in any bankruptcy,
reorganization or insolvency proceeding of or against the Company or the
Airline, the Holders will, at the Limited Guarantor's request and expense,
execute and deliver to the Limited Guarantor appropriate documents, necessary
to evidence the transfer by subrogation to the Limited Guarantor of an interest
resulting from such payment made by such Limited Guarantor pursuant to this
Limited Guaranty.

         6. SUBORDINATION OF INDEBTEDNESS, BANKRUPTCY OF COMPANY. Any
indebtedness of the Company or the Airline now or hereafter held by the Limited
Guarantor (including, without limitation, any Senior Secured Guaranteed
Floating Rate Note held by the Limited Guarantor), is hereby subordinated to
the indebtedness of the Company and the Airline to the Holder; and, upon the
request of the Holder, such indebtedness of the Company or the Airline to the
Limited Guarantor shall be collected, enforced and received by the Limited
Guarantor as trustee for the Holder and shall be paid over to the Holder on
account of the indebtedness of the Company and the Airline to the Holder
without reducing or affecting in any manner the liability of the Limited
Guarantor under the other provisions of this Limited Guaranty.

         7. CLAIMS IN BANKRUPTCY. The Limited Guarantor will file all claims
against the Company and/or the Airline in any bankruptcy or other proceeding in
which the filing of claims is required or permitted by law upon any
indebtedness of the Company or the Airline to the Limited Guarantor or claim
against the Company or the Airline by the Limited Guarantor, and the Limited
Guarantor hereby assigns to FHB all rights of the Limited Guarantor thereunder.
If the Limited Guarantor does not file any such claim, FHB, as attorney-in-fact
for the Limited Guarantor, is hereby authorized to do so in the name of the
Limited Guarantor or, in FHB's discretion,, to assign the claim and to cause
proof of claim to be filed in the name of FHB's nominee. FHB or its nominee
shall have the sole right (as assignee of all rights of the Limited Guarantor
pursuant to this Section 7) to accept or reject any plan proposed in such
proceeding and to take any other action which a party filing a claim is
entitled to take. In all such cases, whether in administration, bankruptcy or
otherwise, the person or persons authorized to pay such claim shall pay to FHB
the full amount payable on such claim up to the amounts due under this Limited
Guaranty, and, to the full extent necessary for that purpose, the Limited
Guarantor hereby assigns to FHB all of the Limited Guarantor's rights to any
such payments or distributions to which the Limited Guarantor would otherwise
be entitled; provided, however, that the Limited Guarantor's obligations
hereunder shall not be satisfied except to the extent that FHB receives cash by
reason of any such payment or


                                     -5-
<PAGE>

distribution. If FHB receives anything hereunder other than cash, the same
shall be held as collateral for the payment of all amounts due under this
Limited Guaranty.

         8. LITIGATION; CHANGE IN LIMITED GUARANTOR'S FINANCIAL CONDITION. The
Limited Guarantor will promptly notify FHB of (i) any litigation to which the
Limited Guarantor becomes a party (which is not covered by insurance), and (ii)
any adverse change in the Limited Guarantor's financial condition, either of
which might materially impair or diminish the value of this Limited Guaranty to
the Holder as an assurance of the repayment of the indebtedness of the Company
or the Airline to the Holder. The Limited Guarantor shall promptly furnish the
Holder with such information, financial or otherwise, as the Holder may from
time to time request concerning the Limited Guarantor.

         9. CONDITION OF COMPANY AND AIRLINE. The Limited Guarantor is fully
aware of the financial condition of the Company and the Airline and is
executing and delivering this Limited Guaranty based solely upon the Limited
Guarantor's own independent investigation of all matters pertinent hereto, and
is not relying in any manner upon any representation or statement of FHB. The
Limited Guarantor represents and warrants that the Limited Guarantor is in a
position to obtain and the Limited Guarantor hereby assumes full responsibility
for obtaining, any additional information concerning the Company's and the
Airline's financial condition and any other matter pertinent hereto as the
Limited Guarantor may desire, and the Limited Guarantor is not relying upon or
expecting FHB to furnish to the Limited Guarantor any information now or
hereafter in FHB's possession concerning the same or any other matter. By
executing this Limited Guaranty, the Limited Guarantor knowingly acknowledges
and accepts the full range of risks encompassed within a contract of this type.
The Limited Guarantor shall have no right to require FHB to obtain or disclose
any information with respect to the indebtedness under the Notes or the Line of
Credit, the financial condition or character of the Company or the Airline, the
Company's or the Airline's ability to pay such indebtedness, the existence of
any collateral or security for any or all of such indebtedness, the existence
or non-existence of any other guaranties of all or any part of such
indebtedness, or any action or non-action on the part of FHB, the Company, the
Airline, or any other person, or any other matter, fact or occurrence
whatsoever.

         10. FINANCIAL COVENANT; NEGATIVE COVENANTS.

             (a) The Limited Guarantor shall at all times herein maintain a
minimum "Net Worth" of at least $15,000,000.00. As used herein, the term
"Net Worth" shall mean the excess of the Limited Guarantor's total assets
over the Limited Guarantor's total liabilities, as determined in accordance
with accounting principles consistently applied by the Limited Guarantor and
as set forth in the financial statements dated December 31, 1999, previously
delivered to the Lender.

             (b) As soon as available, but not later than one hundred twenty
(120) days after the end of each fiscal year, the Limited Guarantor shall
provide to the Lender financial statements of the Limited Guarantor, which
are acceptable to the Lender.

             (c) At all times herein, the Limited Guarantor shall not,
without the prior written consent of FHB, (i) directly or indirectly make or
commit to make any loan, advance, guaranty or extension of credit to any
corporation, association, partnership, organization or individual affiliated


                                     -6-
<PAGE>

distribution. If FHB receives anything hereunder other than cash, the same
shall be held as collateral for the payment of all amounts due under this
Limited Guaranty.

         8. LITIGATION; CHANGE IN LIMITED GUARANTOR'S FINANCIAL CONDITION.
The Limited Guarantor will promptly notify FHB of (i) any litigation to which
the Limited Guarantor becomes a party (which is not covered by insurance),
and (ii) any adverse change in the Limited Guarantor's financial condition,
either of which might materially impair or diminish the value of this Limited
Guaranty to the Holder as an assurance of the repayment of the indebtedness
of the Company or the Airline to the Holder. The Limited Guarantor shall
promptly furnish the Holder with such information, financial or otherwise, as
the Holder may from time to time request concerning the Limited Guarantor.

         9. CONDITION OF COMPANY AND AIRLINE. The Limited Guarantor is fully
aware of the financial condition of the Company and the Airline and is
executing and delivering this Limited Guaranty based solely upon the Limited
Guarantor's own independent investigation of all matters pertinent hereto,
and is not relying in any manner upon any representation or statement of FHB.
The Limited Guarantor represents and warrants that the Limited Guarantor is
in a position to obtain and the Limited Guarantor hereby assumes full
responsibility for obtaining, any additional information concerning the
Company's and the Airline's financial condition and any other matter
pertinent hereto as the Limited Guarantor may desire, and the Limited
Guarantor is not relying upon or expecting FHB to furnish to the Limited
Guarantor any information now or hereafter in FHB's possession concerning the
same or any other matter. By executing this Limited Guaranty, the Limited
Guarantor knowingly acknowledges and accepts the full range of risks
encompassed within a contract of this type. The Limited Guarantor shall have
no right to require FHB to obtain or disclose any information with respect to
the indebtedness under the Notes or the Line of Credit, the financial
condition or character of the Company or the Airline, the Company's or the
Airline's ability to pay such indebtedness, the existence of any collateral
or security for any or all of such indebtedness, the existence or
non-existence of any other guaranties of all or any part of such
indebtedness, or any action or non-action on the part of FHB, the Company,
the airline, or any other person, or any other matter, fact or occurrence
whatsoever.

         10. FINANCIAL COVENANT; NEGATIVE COVENANTS.

            (a) The Limited Guarantor shall at all times herein maintain a
minimum "Net Worth" of at least $15,000,000.00. As used herein, the term
"Net Worth" shall mean the excess of the Limited Guarantor's total assets
over the Limited Guarantor's total liabilities, as determined in accordance
with accounting principles consistently applied by the Limited Guarantor and
as set forth in the attached financial statements dated
______________________.

            (b) As soon as available, but not later than one hundred twenty
(120) days after the end of each fiscal year, the Limited Guarantor shall
provide to the Lender financial statements of the Limited Guarantor, which
are acceptable to the Lender.

            (c) At all times herein, the Limited Guarantor shall not, without
the prior written consent of FHB, (i) directly or indirectly make or commit
to make any loan, advance, guaranty or extension of credit to any
corporation, association, partnership, organization or individual affiliated


                                     -6-
<PAGE>

with the Limited Guarantor; or (ii) sell, transfer, hypothecate, assign or
convey any asset, or interest therein, of the Limited Guarantor; except in the
ordinary course of the Limited Guarantor's business.

         11. BANKRUPTCY. Until all indebtedness under the Notes and the Line
of Credit has been paid to the Holder, or the Termination Date, whichever
occurs first, the Limited Guarantor shall not, without the prior written
consent of the Holder, commence or join with any other person in commencing
any bankruptcy, reorganization or insolvency proceedings of or against the
Company or the Airline. The obligations of the Limited Guarantor under this
Limited Guaranty shall not be altered, limited or affected by any proceeding,
voluntary or involuntary, involving the bankruptcy, insolvency, receivership,
reorganization, liquidation or arrangement of the Company or the Airline, or
by any defense which the Company or the Airline may have by reason of the
order, decree or decision of any court or administrative body resulting from
any such proceeding. The Limited Guarantor acknowledges and agrees that any
interest on the indebtedness under the Notes or the Line of Credit which
accrues after the commencement of any such proceeding (or, if interest on any
portion of such indebtedness ceases to accrue by operation of law by reason
of the commencement of said proceeding, such interest as would have accrued
on any such portion of such indebtedness if said proceeding had not been
commenced) shall be included in the indebtedness guaranteed by the Limited
Guarantor hereunder, since it is the intention of the parties that the amount
of the indebtedness which is guaranteed by the Limited Guarantor pursuant to
this Limited Guaranty should be determined without regard to any rule of law
or order which may relieve the Company or the Airline of any portion of such
indebtedness. The Limited Guarantor will permit any trustee in bankruptcy,
receiver, debtor in possession, assignee for the benefit of creditors or
similar person to pay to the Holder, or allow the claim of the Holder in
respect of, any such interest accruing after the date on which such
proceeding is commenced.

         12. REPRESENTATIONS AND WARRANTIES.

             (a) ORGANIZATION, STANDING AND AUTHORITY OF LIMITED GUARANTOR.
The Limited Guarantor is a Hawaii limited partnership, duly registered,
validly existing and in good standing under the laws of the State of Hawaii,
and has all requisite power and authority to carry on the business and to own
the property that it now carries on and owns. The Limited Guarantor has all
requisite power and authority to execute and deliver this Limited Guaranty
and to observe and perform all of the provisions and conditions hereof. The
execution and delivery of this Limited Guaranty have been duly authorized by
the general partner of the Limited Guarantor, and no other partnership action
of the Limited Guarantor is requisite to the execution and delivery of this
Limited Guaranty.

             (b) TAX RETURNS AND PAYMENTS. All tax returns and reports of
the Limited Guarantor required by law to be filed have been duly filed, and all
taxes, assessments, contributions, fees and other governmental charges (other
than those presently payable without penalty or interest and those which have
been disclosed to the Lender but which are currently being contested in good
faith) upon the Limited Guarantor, or upon its properties or assets or income,
which are due and payable, have been paid.

             (c) LITIGATION. There is, to the knowledge of the Limited
Guarantor, no action, suit, proceeding or investigation pending at law or in
equity or before any federal, state, territorial,


                                     -7-
<PAGE>

municipal or other governmental department, commission, board, bureau, agency
or instrumentality or threatened against the Limited Guarantor, which might
materially adversely affect the Limited Guarantor's ability to perform its
obligations under this Limited Guaranty.

            (d) LIMITED GUARANTOR'S COMPLIANCE WITH OTHER INSTRUMENTS,
NONE BURDENSOME. The Limited Guarantor is not in violation of or in default
with respect to any term or provision of its Partnership Agreement or any
material mortgage, indenture, contract, agreement or instrument to which the
Limited Guarantor is bound; and the execution, delivery, performance of and
compliance with this Limited Guaranty will not result in any such violation or
be in conflict with or constitute a default under any such term or provision or
result in the creation of any mortgage, lien or charge on any of the properties
or assets of the Limited Guarantor not contemplated by this Limited Guaranty;
and there is no term or provision of its Partnership Agreement, or any
mortgage, indenture, contract, agreement or instrument to which the Limited
Guarantor is bound, which may materially adversely affect the financial
condition of the Limited Guarantor.

           (e) FINANCIAL STATEMENTS. All financial statements heretofore
delivered to the Lender by the Limited Guarantor are true and correct in all
respects, and fairly represent the financial condition of the Limited Guarantor
as of the dates thereof; and no material, adverse changes have occurred in the
financial condition reflected therein since the respective dates thereof.

           (f) CHARACTER OF REPRESENTATIONS AND WARRANTIES. None of the
financial statements or any certificate or statement furnished to the Lender by
or on behalf of the Limited Guarantor in connection with the Limited Guaranty,
and none of the representations and warranties in this Limited Guaranty,
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements contained therein or herein not
misleading. To the best knowledge of the Limited Guarantor, there is no fact
which materially adversely affects or may materially adversely affect the
ability of the Limited Guarantor to observe or perform its obligations under
this Limited Guaranty, which has not been set forth herein or in a certificate
or opinion of counsel or other written statement furnished to the Lender by or
on behalf of the Limited Guarantor.

         13. REMEDIES, CUMULATIVE. The rights and remedies of the Holder
hereunder and under all documents, instruments and agreements executed by or
for the benefit of the company or the Airline in connection with the Notes or
the Line of Credit are cumulative and not exclusive and may be exercised in
whole or in part and in any order and at any time or times as the Holder shall
determine. All security of any kind or nature received or receivable by the
Holder for the repayment of the indebtedness under the Notes or the Line of
Credit may be applied in any manner or order determined by the Holder.

         14. AMENDMENTS, CONTINUING LIABILITY. The terms of this Limited
Guaranty may not be modified or amended except by a written agreement executed
by the Limited Guarantor with the consent in writing of the Holder. The
obligations of the Limited Guarantor under this Limited Guaranty shall be
continuing obligations and a separate cause of action shall be deemed to arise
in respect of each default hereunder.

         15. RECEIPT AND EXAMINATION OF NOTES AND OTHER DOCUMENTS. The Limited
Guarantor hereby acknowledges that it has received and examined copies of the
Notes, and all other documents,


                                     -8-
<PAGE>

instruments and agreements executed by or for the benefit of the Company or the
Airline in connection with the Notes or the Line of Credit.

         16. NOTICES. Any notice or demand to be given or served hereunder
shall be in writing and personally delivered, or sent by registered or
certified mail addressed as follows:

         To FHB at:       First Hawaiian Bank
                          999 Bishop Street
                          Honolulu, Hawaii 96813
                          Attention: Danford H. Oshima
                                     Vice President, Corporate Banking Division
                                     Fax: (808) 525-7173

         To LIMITED GUARANTOR at:
                          841 Bishop Street, Suite 940
                          Honolulu, Hawaii 96813
                          Attention: Han P. Ching

Any such address may be changed from time to time by the addressee by serving
notice to the other party as above provided. Service of such notice or demand
shall be deemed complete on the date of actual delivery or at the expiration of
the second day after the date of mailing if mailed in Hawaii, whichever is
earlier.

         17. PARTIES IN INTEREST. All covenants, agreements, terms and
conditions in this Limited Guaranty contained shall be binding on the Limited
Guarantor and its successors, successors in trust, and assigns, and shall
bind, inure to the benefit of and be enforceable by the Holder from time to
time.

         18. GOVERNING LAW; SEVERABILITY. This Limited Guaranty shall for all
purposes be construed in accordance with the laws of the State of Hawaii. The
Limited Guarantor hereby irrevocably and unconditionally submits, for purposes
of any action or proceeding which the Holder may bring to enforce this Limited
Guaranty, to the jurisdiction of the courts of the State of Hawaii and the
Federal District Court for the District of Hawaii. The submission to such
jurisdiction shall not prevent the Holder from commencing any such action or
proceeding in any other court having jurisdiction. If any provision of this
Limited Guaranty is held to be invalid or unenforceable, the validity or
enforceability of the other provision shall remain unaffected.

         19. PARAGRAPH HEADINGS. The headings of paragraphs herein are inserted
only for convenience and shall in no way define, describe or limit the scope or
intent of any provision of this Limited Guaranty.


                                      -9-
<PAGE>

          IN WITNESS WHEREOF, the Limited Guarantor has executed this instrument
as of September 8, 2000.

                                ALOHA SECURITIES & INVESTMENT COMPANY

                                By Aloha Investment Company, Inc.
                                   Its General Partner

                                   By /s/ Earl Ching
                                      ---------------------------------
                                          Earl Ching
                                      Its Vice President


                                      -10-