Exhibit
10.63






AIRTRAN
      HOLDINGS, INC.,
              
              as
      ISSUER
              
              and
              
              BANK
      OF UTAH,
              
              not
      in its individual capacity
              
              but
      in a trust capacity as the
              
              INITIAL
      HOLDERWARRANT
      AGREEMENTDated
      as of October 31, 2008
              
              Warrants
      to Purchase
              Shares
      of Common Stock
              Par
      Value $.001 Per Share







TABLE
OF CONTENTS




Page




TABLEOF
      CONTENTS.......................................................................................................................................................................................i




EXHIBITS AND
      SCHEDULES.............................................................................................................................................................................iii




WARRANT
      AGREEMENT...................................................................................................................................................................................1




PREAMBLE..........................................................................................................................................................................................................1




ARTICLE I ISSUANCE,
      FORM, EXECUTION, DELIVERY AND  REGISTRATION OF WARRANT
      CERTIFICATES.......................................1




SECTION 1.1.Issuance
      of Warrants...........................................................................................................................1


SECTION 1.2.Form
      of Warrant Certificates.............................................................................................................2


SECTION 1.3.Execution
      of Warrant Certificates.....................................................................................................2


SECTION 1.4.Delivery.................................................................................................................................................2


SECTION 1.5.Registrar
      and Warrant Register.........................................................................................................2


SECTION 1.6.Direct
      Registration of Warrants.........................................................................................................3


SECTION 1.7.Registration
      of Transfers and
      Exchanges...........................................................................................3


SECTION 1.8.Lost,
      Stolen, Destroyed, Defaced or Mutilated Warrant
      Certificates............................................6


SECTION 1.9.Offices
      for Exercise, etc.......................................................................................................................6




ARTICLE II DURATION,
      EXERCISE OF WARRANTS AND EXERCISE
      PRICE.................................................................................................6




SECTION 2.1.Duration
      of Warrants...........................................................................................................................6


SECTION 2.2.Exercise,
      Exercise Price, Settlement and
      Delivery............................................................................7


SECTION 2.3.Cancellation
      of Warrant Certificates................................................................................................9




ARTICLE
      III OTHER PROVISIONS RELATING TO  RIGHTS OF HOLDERS OF
      WARRANTS...........................................................................9




SECTION 3.1.Enforcement
      of
      Rights..........................................................................................................................9




ARTICLE
      IV CERTAIN COVENANTS OF THE COMPANY................................................................................................................................9




SECTION 4.1.Payment
      of Taxes..................................................................................................................................9


SECTION 4.2.Notice
      of Expiration Date...................................................................................................................10


SECTION 4.3.Reservation
      of Common Stock..........................................................................................................10


SECTION 4.4.Warrant
      Shares to be Duly Authorized and Issued, Fully Paid and
      Nonassessable...................10


SECTION 4.5.Reports.................................................................................................................................................10


SECTION
      4.6.Private
      Placement Numbers..............................................................................................................11


SECTION 4.7.Right
      of Action....................................................................................................................................11


SECTION 4.8.Registration
      Rights............................................................................................................................11


SECTION 4.9.Listing/Inclusion
      for Quotation........................................................................................................11


SECTION 4.10.Survival..............................................................................................................................................12






ii




ARTICLE
      V ADJUSTMENTS.............................................................................................................................................................................12




SECTION 5.1.Adjustment
      of Exercise Price and Number of Warrant Shares Issuable....................................12


SECTION 5.2.Fractional
      Interest.............................................................................................................................18


SECTION 5.3.When
      Adjustment Not Required.....................................................................................................18


SECTION 5.4.Treasury
      Stock...................................................................................................................................18


SECTION 5.5.Notices
      to Holders.............................................................................................................................19




ARTICLE VI
      MISCELLANEOUS........................................................................................................................................................................19




SECTION 6.1.Defined
      Terms....................................................................................................................................19


SECTION 6.2.Amendment........................................................................................................................................22


SECTION 6.3.Address
      for Notices to the Company and for Transmission of Documents.................................23


SECTION 6.4.Notices
      to Holders..............................................................................................................................23


SECTION 6.5.Applicable
      Law...................................................................................................................................23


SECTION 6.6.Obtaining
      of Governmental Approvals...........................................................................................23


SECTION 6.7.Persons
      Having Rights Under Agreement......................................................................................24


SECTION 6.8.Headings.............................................................................................................................................24


SECTION 6.9.Counterparts......................................................................................................................................24


SECTION 6.10.Inspection
      of Warrant Agreement.................................................................................................24


SECTION 6.11.Successors.........................................................................................................................................24









EXHIBITS
AND SCHEDULES




Page




EXHIBIT
A-1                             FORM
OF WARRANT
CERTIFICATE...............................................................................................................................A-1




EXHIBIT
B                                CERTIFICATE
TO BE DELIVERED UPON EXCHANGEOR REGISTRATION OF TRANSFER
OF WARRANTS............B-1




EXHIBIT
C                                TRANSFEREE
LETTER OF
REPRESENTATION..............................................................................................................C-1




SCHEDULE
4.3                         CAPITALIZATION.............................................................................................................................................................D-1















WARRANT
AGREEMENT






PREAMBLE




THIS
WARRANT AGREEMENT (“Warrant
Agreement”), dated as of October 31, 2008 (the “Closing
Date”) is executed and delivered by AirTran Holdings, Inc., a Nevada
corporation (together with any successor thereto, the “Company”)
and Bank of Utah, not in its individual capacity, but as trustee under that
certain trust agreement dated as of October 30, 2008 (the “Trustee”),
as the initial holder of the Warrants (as hereinafter defined) in such trust
capacity (the “Initial
Holder”) for the benefit of the Initial Holder and any subsequent
registered holders (the “Holders”)
from time to time of the Warrants.




WHEREAS,
the Company’s wholly-owned subsidiary AirTran Airways, Inc. (“Airways”)
has entered into that certain Amended and Restated Revolving Line of Credit and
Reimbursement Agreement dated even date herewith (the “Credit
Agreement”) with the Initial Holder pursuant to which the Initial Holder
has agreed to procure letters of credit on behalf of Airways and to provide
financing to Airways as pursuant to the terms and conditions of such Credit
Agreement in exchange, for among other consideration set forth in the Credit
Agreement, warrants (each a “Warrant”
and, collectively, the “Warrants”
and any certificates evidencing the Warrants being hereinafter referred to as
the “Warrant
Certificates”) entitling the Holder thereof to initially purchase
4,700,886 shares of the Company’s common stock $.001 par value per share (the
“Common
Stock”), subject to adjustment in accordance with the terms hereof;
and




NOW,
THEREFORE, in consideration of the financial accommodations set forth in the
Credit Agreement and for other good and valuable consideration, the adequacy and
receipt of which is hereby acknowledged, and for the purpose of defining the
respective rights and obligations of the Company, and the Holders, the parties
hereto agree as follows:




ARTICLE
I




ISSUANCE,
FORM, EXECUTION, DELIVERY AND


REGISTRATION
OF WARRANT CERTIFICATES




SECTION
1.1.Issuance
of Warrants.Each Warrant Certificate shall evidence the number of
Warrants specified therein, and each Warrant evidenced thereby shall represent
the right, subject to the provisions contained herein and therein, to purchase
from the Company (and the Company shall issue and sell to such Holder) one fully
paid and non-assessable share of Common Stock (the shares of Common Stock
purchasable upon exercise of a Warrant being hereinafter referred to as the
“Warrant
Shares” and, where appropriate, such term shall also mean the other
securities or property purchasable and deliverable upon exercise of a Warrant as
provided in Article
V) at the price specified herein and therein, in each case subject to
adjustment as provided herein and therein.











SECTION
1.2.Form
of Warrant Certificate.The
Warrants will be issued only in certificated form.  The Warrant
Certificates evidencing the Warrants to be delivered pursuant to this Warrant
Agreement shall be substantially in the form set forth in Exhibit
A attached hereto, dated as of the Closing Date.




SECTION
1.3.Execution
of Warrant Certificates.The
Warrant Certificates shall be executed on behalf of the Company by its President
or any Vice President and attested to by its Secretary or Assistant Secretary,
under its corporate seal.  Such signatures may be the manual or
facsimile signatures of the present or any future such officers.  The
seal of the Company may be in the form of a facsimile hereof and may be
impressed, affixed, imprinted or otherwise reproduced on the Warrant
Certificates.  Typographical and other minor errors or defects in any
such reproduction of the seal or any such signature shall not affect the
validity or enforceability of any Warrant Certificate that has been delivered by
the Company.




In case
any officer of the Company who shall have signed any of the Warrant Certificates
shall cease to be such officer before the Warrant Certificate so signed shall be
delivered to the applicable Holder or disposed of by the Company, such Warrant
Certificate nevertheless may be delivered or disposed of as though the person
who signed such Warrant Certificate had not ceased to be such officer of the
Company; and any Warrant Certificate may be signed on behalf of the Company by
such persons as, at the actual date of the execution of such Warrant
Certificate, shall be the proper officers of the Company, although at the date
of the execution and delivery of this Warrant Agreement any such person was not
such an officer.




SECTION
1.4.Delivery.The
Warrant Certificates shall be numbered and shall be registered in the Warrant
Register (as defined in Section
1.5 hereof).  The Company shall deliver the Warrant
Certificates to the Initial Holder.




SECTION
1.5.Registrar
and Warrant Register.The
Company will keep, at the office or agency maintained by the Company for such
purpose, a register or registers in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of, and registration of transfer and exchange of, Warrants as provided in this
Article.  The Company in such capacity and each Person designated by
the Company from time to time as a Person authorized to register the transfer
and exchange of the Warrants is hereinafter called, individually and
collectively, the “Registrar.”  Initially,
the Company shall act as Registrar.  The Company may appoint a third
party to serve as Registrar.




The
Company will at all times designate one Person (who initially will be the
Company and who need not be a Registrar) to act as repository of a master list
of names and addresses of the Holders (the “Warrant
Register”).  The Company will act as such repository unless and
until some other Person is, by written notice from the Company to the Holders,
designated by the Company to act as such.  The Company shall cause
each Registrar to furnish to such repository, on a current basis, such
information as to all registrations of transfer and exchanges effected by such
Registrar, as may be necessary to enable such repository to maintain the Warrant
Register on as current a basis as is practicable.








2




SECTION
1.6.Direct
Registration of Warrants.So long
as the Common Stock is eligible to participate in a direct registration system
or other comparable book entry system, whether pursuant to the requirements of
any national securities exchange or otherwise, the Company may provide for
direct registration or other book entry registration of the Warrants and the
terms of this Agreement shall be modified mutatis
muntandis.




SECTION
1.7.Registration
of Transfers and Exchanges.




(a)Transfer
and Exchange.  When Warrants are presented to the Company with
a request:




(i)to
register the transfer of the Warrants; or




(ii)to
exchange such Warrants for an equal number of Warrants, the Company shall
register the transfer or make the exchange as requested if the requirements
under this Warrant Agreement as set forth in this Section
1.7 for such transactions are met; provided,
however, that the Warrants presented or surrendered for registration of
transfer or exchange:




(x)
            shall
      be duly endorsed or accompanied by a written instruction of transfer in
      form satisfactory to the Company, duly executed by the Holder thereof or
      by its attorney, duly authorized in
  writing,  and




(y)
            in
      the case of Warrants the offer and sale of which has not been registered
      under the Securities Act, and are presented for transfer or exchange prior
      to (x) the date which is six months after the later of the date of
      original issue (the “Issue
      Date”) and the last date on which the Company or any affiliate of
      the Company was the owner of such Warrant, or any predecessor thereto and
      (y) such later date, if any, as may be required by any subsequent change
      in applicable law (the “Resale
      Restriction Termination Date”), such Warrants shall be accompanied,
      in the sole discretion of the Company, by the following additional
      information and documents, as
applicable:




(A)
            if
      such Warrant is being delivered to the Registrar by a Holder for
      registration in the name of such Holder, without transfer, a certification
      from such Holder to that effect (in substantially the form of Exhibit
      B hereto); or




(B)
            if
      such Warrant is being transferred in reliance on any exemption from the
      registration requirements of the Securities Act, a certification to that
      effect (in substantially the form of Exhibit
      B hereto) and an opinion of counsel reasonably acceptable to the
      Company to the effect that such transfer is in compliance with the
      Securities Act.




(b)Legends.




(i)Except to
the extent permitted by paragraph (ii) of this Section
1.7(b), each Warrant Certificate (and all Warrants issued in exchange
therefor or substitution thereof) shall bear a legend substantially to the
following effect:




3


NEITHER
THE WARRANTS REPRESENTED BY THIS WARRANT CERTIFICATE NOR THE SHARES OF COMMON
STOCK, PAR VALUE $.001 PER SHARE, OF AIRTRAN HOLDINGS, INC. FOR WHICH THE
WARRANT IS EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  NEITHER THIS WARRANT
CERTIFICATE NOR ANY INTEREST OR PARTICIPATION HEREIN NOR ANY SHARE OF COMMON
STOCK ACQUIRED UPON EXERCISE HEREOF MAY BE REOFFERED, 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,
REGISTRATION.




THE
HOLDER OF THE WARRANTS REPRESENTED BY THIS WARRANT CERTIFICATE OR ANY SECURITIES
OF THE COMPANY FOR WHICH THE WARRANT IS EXERCISABLE, BY ITS ACCEPTANCE HEREOF,
AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THE WARRANTS REPRESENTED BY THIS
WARRANT CERTIFICATE ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO
LONG AS THE WARRANTS REPRESENTED BY THIS WARRANT CERTIFICATE ARE ELIGIBLE FOR
RESALE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, TO A
PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT 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 AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT, (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), (7) OR (8) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THE WARRANTS REPRESENTED BY THIS WARRANT CERTIFICATE 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, AS APPLICABLE, RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D), (E) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
REASONABLY SATISFACTORY TO THE COMPANY, AND IN EACH OF THE FOREGOING CASES, AN
ASSIGNMENT IN THE FORM APPEARING ON THE OTHER SIDE OF THIS WARRANT CERTIFICATE
IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE COMPANY.  THIS
LEGEND SHALL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.




4


THIS
SECURITY IS SUBJECT TO A REGISTRATION RIGHTS AGREEMENT DATED AS OF OCTOBER 31,
2008 BETWEEN THE COMPANY AND BANK OF UTAH, NOT IN ITS INDIVIDUAL CAPACITY BUT AS
TRUSTEE (THE “TRUSTEE”) UNDER THAT CERTAIN TRUST AGREEMENT DATED OCTOBER 30,
2008 AND AS IN SUCH TRUST CAPACITY AS THE INITIAL HOLDER (THE “INITIAL HOLDER”)
OF THE WARRANTS.  A COPY OF WHICH REGISTRATION RIGHTS AGREEMENT IS ON
FILE WITH THE SECRETARY OF THE COMPANY.




(ii)Upon any
sale or transfer of a Warrant pursuant to Rule 144 under the Securities Act in
accordance with this Section
1.7 or an effective registration statement under the Securities Act, the
Company shall permit the Holder thereof to exchange such Warrant Certificate for
a Warrant Certificate that does not bear the legend set forth above and rescind
any related restriction on the transfer of such Warrant; and




(c)Obligations
with Respect to Transfers and Exchanges.




(i)The
Company shall execute the Warrants to permit registration of transfers and
exchanges.




(ii)All
Warrants issued upon any registration of transfer or exchange thereof shall be
the valid obligations of the Company, entitled to the same benefits under this
Warrant Agreement as the Warrants surrendered upon the registration of transfer
or exchange.




(iii)Prior to
due presentment for registration of transfer of any Warrant, the Company may
deem and treat the Person in whose name any Warrant is registered as the
absolute owner of such Warrant, and the Company shall not be affected by notice
to the contrary.




(d)Payment
of Taxes.  The Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any exchange or transfer pursuant to this Section
1.7.








5


SECTION
1.8.Lost,
Stolen, Destroyed, Defaced or Mutilated Warrant Certificates.  Upon
receipt by the Company (or any agent of the Company), of evidence satisfactory
to them of the loss, theft, destruction, defacement, or mutilation of any
Warrant Certificate and of indemnity reasonably satisfactory to it and, in the
case of mutilation or defacement, upon surrender thereof to the Company (or any
agent of the Company) for cancellation, then, in the absence of notice to the
Company (or any agent of the Company) that such Warrant Certificate has been
acquired by a bona fide purchaser or holder in due course, the Company shall
execute and deliver or cause to be delivered by such agent, in exchange for or
in lieu of the lost, stolen, destroyed, defaced or mutilated Warrant
Certificate, a new Warrant Certificate representing a like number of Warrants,
bearing a number or other distinguishing symbol not contemporaneously
outstanding.  Upon the issuance of any new Warrant Certificate under
this Section
1.8, the Company (or any agent of the Company) may require payment from
the Holder of such Warrant Certificate of a sum sufficient to cover any tax,
stamp tax or other governmental charge that may be imposed in relation thereto
and any other expenses (including the fees and expenses of the Company and any
third person Registrar) in connection therewith.  Every substitute
Warrant Certificate executed and delivered pursuant to this Section
1.8 in lieu of any lost, stolen or destroyed Warrant Certificate shall
constitute an additional contractual obligation of the Company, whether or not
the lost, stolen or destroyed Warrant Certificate shall be at any time
enforceable by anyone, and shall be entitled to the benefits of (but shall be
subject to all the limitations of rights set forth in) this Warrant Agreement
equally and proportionately with any and all other Warrant Certificates duly
executed and delivered hereunder.  The provisions of this Section
1.8 are exclusive with respect to the replacement of lost, stolen,
destroyed, defaced or mutilated Warrant Certificates and shall preclude (to the
extent lawful) any and all other rights or remedies notwithstanding any law or
statute existing or hereafter enacted to the contrary with respect to the
replacement of lost, stolen, destroyed, defaced or mutilated Warrant
Certificates.




SECTION
1.9.Offices
for Exercise, etc.  So
long as any of the Warrants remain outstanding, the Company will designate and
maintain in the continental United States: (a) an office or agency where
the Warrant Certificates may be presented for exercise, (b) an office or agency
where the Warrant Certificates may be presented for registration of transfer and
for exchange, and (c) an office or agency where notices and demands to or upon
the Company in respect of the Warrants or of this Warrant Agreement may be
served.  The Company may from time to time change or rescind such
designation, as it may deem desirable or expedient.  The Company will
give to each Holder written notice of the location of any such office or agency
and of any change of location thereof.  The Company hereby designates
its corporate offices in Orlando, Florida (the “Company
Office”), as the initial office maintained for each such
purpose.






ARTICLE
II




DURATION,
EXERCISE OF WARRANTS AND EXERCISE PRICE




SECTION
2.1.Duration
of Warrants.  Subject
to the terms and conditions established herein, the Warrants shall expire at
5:00 p.m., New York City time on October 31, 2011 (the “Expiration
Date”).  Warrants may be exercised on any Business Day (as
hereinafter defined) on or after the Exercisability Date (as hereinafter
defined) and on or prior to the Expiration Date.






6


Any
Warrant not exercised before the close of business on the Expiration Date shall
become void, and all rights of the Holder under the Warrant Certificate
evidencing such Warrant and under this Warrant Agreement shall
cease.




SECTION
2.2.Exercise,
Exercise Price, Settlement and Delivery.




(a)Subject
to the provisions of this Warrant Agreement, each Warrant Holder shall have the
right to purchase from the Company on or after the Exercisability Date and on or
prior to the Expiration Date, one fully paid and non-assessable Warrant Share
per each Warrant such Holder owns, subject to adjustment in accordance with
Article
V hereof, at the initial purchase price of $4.49 for each Warrant Share
purchased, subject to adjustment in accordance with Article
V hereof (the “Exercise
Price”).




(b)Warrants
may be exercised, in whole or in part, on or after the Exercisability Date by
(i) surrendering at the Company Office the Warrant Certificate evidencing such
Warrants with the form of election to purchase Warrant Shares set forth on the
reverse side of the Warrant Certificate (the “Election
to Exercise”) duly completed and signed by the registered Holder or
Holders thereof or by the duly appointed legal representative thereof, including
the Trustee, or by a duly authorized attorney and (ii) paying in full the
Exercise Price for each such Warrant Share purchased and any other amounts
required to be paid pursuant to Section
4.1 hereof.




(c)Simultaneously
with the exercise of each Warrant, payment in full of the Exercise Price shall
be made (i) in cash or by certified or official bank check payable to the order
of the Company, delivered to the Company Office where the Warrant Certificate is
being surrendered, (ii) by wire transfer of immediately available funds to a
bank account designated by the Company, (iii) by delivery of Warrant
Certificates pursuant to Section
2.2(d) or (iv) any combination thereof.  Subject to the
provisions of this Warrant Agreement, the rights represented by the Warrants
shall be exercisable at the election of the Holders thereof either in full at
any time or from time to time in part.




(d)In the
event that any Holder of Warrant Certificates delivers such Warrant Certificates
to the Company and indicates on the Election to Exercise that such Holder
intends to exercise all, or any portion of, the Warrants represented by such
Warrant Certificate to satisfy its obligation to pay the Exercise Price in
respect thereof by virtue of the provisions of this Section
2.2(d), such Holder shall become entitled to receive, instead of the
number of Warrant Shares such Holder would have received had the Exercise Price
been paid in cash pursuant to Section
2.2(c), a number of Warrant Shares in respect of the exercise of such
Warrants equal to the productof:




(A)
            the
      number of Warrant Shares issuable upon such exercise of such Warrant
      Certificates (or, if only a portion of such Warrant Certificates are being
      exercised, issuable upon the exercise of such portion) multiplied
      by




(B)
            the
      quotient
      of:




(i)
            the
      difference
      of:




(X)
            the
      per share Fair Market Value of the Common Stock at the time of such
      exercise; minus




(Y)
            the
      Exercise Price at the time of such exercise; divided
  by




(ii)
            the
      per share Fair Market Value of the Common Stock at the time of such
      exercise.




7


For
purposes of Rule 144 under the Securities Act, the Company and the Initial
Holder, on behalf of the Holders, hereby agree that the exercise of any Warrants
in accordance with this Section
2.2(d) shall be deemed to be a conversion of such Warrants, pursuant to
the terms of this Warrant Agreement and the Warrants, into Warrant Shares to the
extent necessary to comply with the provisions of Rule 144(d)(3)(ii) so as to
allow the Warrant Shares to be deemed to be acquired at the same time as the
Warrants.




(e)Upon such
surrender of a Warrant Certificate and payment and collection of the Exercise
Price at any Company Office, such Warrant Certificate and payment shall be
promptly delivered to the Company but in no event later than the third Business
Day after surrender of such Warrant Certificate.  The “Exercise
Date” for a Warrant shall be the date when all of the items referred to
in the first sentence of paragraphs (b) and (c) of this Section
2.2 are received by the Company at or prior to 2:00 p.m., New York City
time, on a Business Day and the exercise of the Warrants will be effective as of
such Exercise Date.  If any items referred to in the first sentence of
paragraphs (b) and (c) of this Section
2.2 are received after 2:00 p.m., New York City time, on a Business Day,
the exercise of the Warrants to which such item relates will be effective on the
next succeeding Business Day.  Notwithstanding the foregoing, in the
case of an exercise of Warrants on the Expiration Date, if all of the items
referred to in the first sentence of paragraphs (b) and (c) of this Section
2.2 are received by the Company at or prior to 5:00 p.m., New York City
time, on such Expiration Date, the exercise of the Warrants to which such items
relate will be effective on the Expiration Date.




(f)Subject
to Section
5.2 hereof, as soon as practicable after the exercise of any Warrant or
Warrants in accordance with the terms hereof, the Company upon written order of
the Holder shall (i) issue or cause to be issued to or upon the written order of
the Holder evidencing such exercised Warrant or Warrants, a certificate or
certificates evidencing the Warrant Shares to which such Holder is entitled, in
fully registered form, registered in such name or names as may be directed by
such Holder pursuant to the Election to Exercise, as set forth on the reverse of
the Warrant Certificate or (ii) if the Common Stock is then eligible for
registration pursuant to a direct registration system or other “book entry”
system, cause such Warrant Shares to be issued in uncertificated form and
registered in such direct registration system or other “book entry”
system.  Such certificate or certificates evidencing the Warrant
Shares shall be deemed to have been issued or such direct registration or book
entry recorded and any Persons who are designated to be named therein shall be
deemed to have become the Holder of record of such Warrant Shares as of the
close of business on the Exercise Date.  After such exercise of any
Warrant or Warrants, the Company shall also issue or cause to be issued to or
upon the written order of the Holder of such Warrant Certificate, a new Warrant
Certificate, evidencing the number of Warrants, if any, remaining unexercised
(unless such Warrants shall have expired).






8


SECTION
2.3.Cancellation
of Warrant Certificates.  In
the event the Company shall purchase or otherwise acquire Warrants, the Warrant
Certificates evidencing such Warrants shall be delivered to the Company, and if
so delivered, shall be canceled by it and retired.  The Company shall
cancel all Warrant Certificates properly surrendered for exchange, substitution,
transfer or exercise.









ARTICLE
III




OTHER
PROVISIONS RELATING TO


RIGHTS
OF HOLDERS OF WARRANTS




SECTION
3.1.Enforcement
of Rights.




(a)Notwithstanding
any of the other provisions of this Warrant Agreement, any Holder of Warrant
Certificates or holder of Warrant Shares, may, in and for its own behalf,
enforce, and may institute and maintain any suit, action or proceeding against
the Company suitable to enforce, its right to exercise the Warrant or Warrants
evidenced by its Warrant Certificate as provided in such Warrant Certificate and
in this Warrant Agreement.




(b)Neither
the Warrants nor any Warrant Certificate shall entitle the Holders thereof to
any of the rights of a holder of Common Stock, including, without limitation, as
applicable, the right to vote or to receive any dividends or other payments or
to consent or to receive notice as stockholders in respect of the meetings of
stockholders or for the election of directors of the Company or to share in the
assets of the Company in the event of the liquidation, dissolution or winding up
of the Company’s affairs or any other matter, or any rights whatsoever as
stockholders of the Company.






ARTICLE
IV




CERTAIN
COVENANTS OF THE COMPANY




SECTION
4.1.Payment
of Taxes.  The
Company will pay all documentary stamp taxes attributable to the initial
issuance of Warrants and of the Warrant Shares upon the exercise of Warrants;
provided,
however, that the Company shall not be required to pay any tax or other
governmental charge which may be payable in respect of any transfer involved in
the issue of any Warrant Certificates or any certificates for Warrant Shares in
a name other than the registered Holder surrendered upon the exercise of a
Warrant.  In any such case, the Company shall not be required to issue
or deliver such Warrant Certificate or certificate for Warrant Shares unless or
until the Person or Persons requesting issuance thereof shall have paid to the
Company the amount of such tax or other governmental charge or shall have
established to the satisfaction of the Company that such tax or other
governmental charge has been paid or an exemption is available
therefrom.








9


SECTION
4.2.Notice
of Expiration Date.  The
Company will give notice of the Expiration Date to all Holders of the then
outstanding Warrants, not less than 90 and not more than 120 days prior to the
Expiration Date; provided, however, the failure of the Company to deliver any
such notice shall not extend or otherwise affect the Expiration
Date.




SECTION
4.3.Reservation
of Common Stock.  The
Company covenants and agrees that it will at all times cause to be reserved and
kept available out of its authorized and unissued shares of Common Stock such
number of shares of Common Stock as will be sufficient to permit the exercise in
full of all Warrants issued hereunder and, except as otherwise expressly
permitted by the terms of such securities, all other rights, warrants or options
exercisable into, and the conversion of all securities convertible into, Common
Stock.  All of the outstanding shares of capital stock of the Company
have been duly authorized and validly issued, are fully paid and nonassessable,
and were not issued in violation of, and are not subject to, any preemptive or
similar rights.  Schedule
4.3 sets forth (a) the Capitalization of the Company as of September 30,
2008 and (b) the pro forma Capitalization of the Company after giving effect to
the issuance and sale of Warrants and Warrant Shares.  The Company has
not issued any Common Stock, preferred stock, options, restricted stock or
securities convertible into or exchangeable for Common Stock since September 30,
2008 through the Closing Date.  “Capitalization”
shall mean (a) the number of authorized and outstanding shares of Common Stock,
(b) the number of authorized and outstanding shares of each series of preferred
stock, (c) a description of outstanding securities convertible into or
exchangeable for Common Stock and the maximum number of shares of Common Stock
issuable upon exercise of all such outstanding rights under ordinary
circumstances without regard to make-whole events, potential accrued but unpaid
interest and elections to pay in kind, (d) the number of options and shares of
restricted stock outstanding under the Company’s equity benefit plans and a
description of such plans to the extent not previously disclosed in the
Company’s filings with the SEC under the Securities Exchange Act of 1934, as
amended, as of September 30, 2008, and (e) the number of any other outstanding
shares or securities.




SECTION
4.4.Warrant
Shares to be Duly Authorized and Issued, Fully Paid and
Nonassessable.  The
Company covenants and agrees that it will take all such action as may be
necessary to ensure that all Warrant Shares delivered upon the exercise in full
of any Warrants, at the time of delivery of the certificates representing such
shares, shall be duly and validly authorized and issued and fully paid and
nonassessable, free of any preemptive rights in favor of any Person in respect
of such issuance and free of any security interest, lien or other encumbrance of
any kind or nature created by, arising out of actions of, the Company, any
subsidiary or any affiliate of the Company.




SECTION
4.5.Reports.  For
so long as any Warrants are outstanding, if at any time the Company is not
subject to the requirements of Section 13 or 15(d) of the Exchange Act, the
Company shall file with the Securities Exchange Commission (the “SEC”),
to the extent permitted, and distribute or cause to be distributed to each
Holder copies of the quarterly and annual financial information that would have
been required to be contained in a filing with the SEC on Forms 10-Q and 10-K
and all current reports that would have been required to be filed with the SEC
on Form 8-K had the Company been subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act.  All such financial
information shall include consolidated financial statements (including footnotes
as would have been required by applicable SEC rules) prepared in accordance with
generally accepted accounting principles.  Such annual financial
information shall also include an opinion thereon expressed by an independent
accounting firm of established national reputation.  All such
consolidated financial statements shall be accompanied by a “Management’s
Discussion and Analysis of Financial Condition and Results of Operation.” The
financial and other information to be distributed to Holders shall be mailed to
the Holders at their respective addresses appearing in the Warrant Register,
within 120 days after the end of the Company’s fiscal year and within 60 days
after the end of each of the first three quarters of each such fiscal
year.  From and after the date of effectiveness of any registration
statement filed with the SEC with respect to the Registerable Securities, as
such term is defined in the Registration Rights Agreement of even date herewith,
the Company will use commercially reasonable efforts to file with the SEC such
Forms 10-Q and 10-K and any other information required to be filed by
it.




10


SECTION
4.6.Private
Placement Numbers.  The
Company covenants and agrees to obtain, and thereafter maintain, a private
placement number in respect of the Warrants and a private placement number or
CUSIP number, as appropriate, in respect of the Warrant Shares from the CUSIP
Service Bureau of Standard & Poor’s, a division of McGraw-Hill,
Inc.




SECTION
4.7.Right
of Action.  All
rights of action in respect of the Warrants are vested in the respective Holders
of the Warrant Certificates, and any Holder of any Warrant Certificate, without
the consent of the Holder of any other Warrant Certificate, may, on its own
behalf and for its own benefit, enforce, and may institute and maintain any
suit, action or proceeding against the Company to enforce, or otherwise act in
respect of, its right to exercise the Warrants evidenced by such Warrant
Certificate in the manner provided in such Warrant Certificate and in this
Warrant Agreement.




SECTION
4.8.Registration
Rights.  All
shares of Common Stock or other securities issued or issuable upon exercise of
the Warrants shall have the registration rights and related obligations set
forth in the Registration Rights Agreement, and the parties hereto shall each
execute such agreements, documents and instruments in connection therewith as
reasonably requested to fulfill the purposes of this Section
4.8.  By receipt of a Warrant, each Holder agrees that,
notwithstanding anything to the contrary in this Agreement or in the
Registration Rights Agreement, the Company shall not be required to “net cash
settle” the Warrants or the Common Stock issuable pursuant to the Warrants due
to the failure or inability of the Company to file or cause the effectiveness
of, or maintain the effectiveness of, any registration statement contemplated by
the Registration Rights Agreement and the sole and exclusive remedy for such
failure or inability shall be the liquidated damages as provided for by the
terms of the Registration Rights Agreement.




SECTION
4.9.Listing/Inclusion
for Quotation.  The
Company covenants and agrees to (i) if the Common Stock is then listed on the
New York Stock Exchange to list all Common Stock issued or issuable upon
exercise of the Warrants on the New York Stock Exchange (in the case of such New
York Stock Exchange listing, such listing shall occur promptly and in any event
within 30 days of the date of this Agreement) or, if the Common Stock is not
then listed on the New York Stock Exchange to list all Common Stock issued or
issuable upon exercise of the Warrants on such other national securities
exchange on which the Common Stock is then listed or (ii) if the Common Stock is
not listed on a national securities exchange and the Common Stock is authorized
for quotation on the National Association of Securities Dealers Automated
Quotation System (“NASDAQ”)
to cause all Common Stock issued or issuable upon exercise of the Warrants to
also be so authorized for quotation.






11


SECTION
4.10.Survival.  The
agreements of the Company contained in Section
4.1, Section
4.7, Section
4.8 and Section
4.9 shall survive the exercise of and the expiration of the
Warrants.






ARTICLE
V




ADJUSTMENTS




SECTION
5.1.Adjustment
of Exercise Price and Number of Warrant Shares Issuable.  The
Exercise Price and the number and kind of Warrant Shares purchasable upon the
exercise of each Warrant shall be subject to adjustment from time to time as
follows:




(a)Stock
Dividends, Subdivisions and Combinations.  In case the Company
shall hereafter (A) pay a dividend in shares of Common Stock or make a
distribution in shares of Common Stock, (B) reclassify by subdivision its
outstanding shares of Common Stock into a greater number of shares or (C)
reclassify by combination its outstanding shares of Common Stock into a smaller
number of shares, (i) the number of Warrant Shares purchasable upon exercise of
each Warrant immediately prior thereto shall be adjusted so that the Holder of
any Warrant Certificate thereafter exercised shall be entitled to receive the
number of Warrant Shares which such Holder would have owned immediately
following such action had such Warrant been exercised immediately prior thereto,
and (ii) the Exercise Price shall be adjusted by multiplying such Exercise Price
immediately prior to such adjustment by a fraction, the numerator of which shall
be the number of Warrant Shares purchasable upon the exercise of each Warrant
immediately prior to such adjustment, and the denominator of which shall be the
number of Warrant Shares purchasable immediately thereafter.  An
adjustment made pursuant to this Section
5.1(a) shall become effective immediately after the record date, in the
case of a dividend, and shall become effective immediately after the effective
date, in the case of a subdivision, combination or
reclassification.  If, as a result of an adjustment made pursuant to
this Section
5.1(a), the Holder of any Warrant Certificate thereafter exercised shall
become entitled to receive shares of two or more classes of Capital Stock of the
Company, the Board of Directors of the Company shall determine, in its
reasonable discretion, the allocation of the adjusted Exercise Price between or
among shares of such classes of Capital Stock.




(b)Reclassification,
Combinations, Mergers, etc.  If (A) any capital reorganization,
reclassification or change of outstanding shares of Common Stock (other than as
set forth in Section
5.1(a) and other than a change in par value, or from par value to no par
value, or from no par value to par value provided that the Company shall not
increase the par value of the Common Stock to exceed the Exercise Price), or (B)
in case of any consolidation or merger of the Company with or into another
corporation or other entity (other than a merger in which the Company is the
continuing corporation and which does not result in any reclassification or
change of the then outstanding shares of Common Stock or other Capital Stock of
the Company (other than a change in par value, or from par value to no par
value, or from no par value to par value or as a result of a subdivision or
combination)) or (C) in case of any sale or conveyance to another corporation or
other entity of all or substantially all of the assets of the Company shall be
effected in such a way that the holders of Common Stock shall be entitled to
receive shares of common stock, other securities or assets (whether such stock,
other securities or assets are issued or distributed by the Company or another
Person) with respect to or in exchange for Common Stock, then, as a condition of
such reclassification, reorganization, change, consolidation, merger, sale or
conveyance, the Company or such a successor or purchasing corporation or other
entity, as the case may be, shall forthwith make lawful and adequate provision
whereby the Holder of such Warrant Certificate then outstanding shall have the
right thereafter to receive on exercise of such Warrant the kind and amount of
shares of stock and other securities and assets receivable upon such
reclassification, reorganization, change, consolidation, merger, sale or
conveyance by a holder of the number of shares of Common Stock that such holders
would have been entitled to receive upon exercise of such Warrant had such
Warrant been exercised immediately before such reclassification, reorganization,
change, consolidation, merger, sale or conveyance that shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article
V and enter into a supplemental warrant agreement so
providing.




12


For
purposes of this Section
5.1(b), “shares of stock and other securities and property” receivable
upon a reclassification, change, consolidation, merger, sale or conveyance shall
include stock of any successor or acquiring corporation of any class which is
not subject to redemption and shall also include any evidence of indebtedness,
shares of stock or other securities which are convertible into or exchangeable
for any such stock, either immediately or upon the arrival of a specified date
or the happening of a specified event including any warrants or other rights to
subscribe for or purchase any such stock.  If the issuer of securities
deliverable upon exercise of Warrants under the supplemental warrant agreement
is an affiliate of the formed, surviving or transferee corporation or other
entity, such issuer shall join in the supplemental warrant
agreement.




In case
of any such reclassification, reorganization, merger, consolidation or
dispositions of assets, the successor or acquiring corporation or other entity
shall expressly assume the due and punctual observance and performance of each
and every covenant and condition of this Warrant Agreement to be performed and
observed by the Company and all the obligations and liabilities hereunder,
subject to such modifications as may be deemed appropriate (as determined in
good faith by resolution of the Board of Directors of the Company) in order to
provide for adjustments of Warrant Shares into which each Warrant is
exercisable, which shall be as nearly equivalent as practicable to the
adjustments provided for in this Article
V.




(c)Issuances
of Common Stock or Rights.  In the event that the Company
shall, at any time or from time to time after the date hereof, issue, sell,
distribute or otherwise grant (in any such case, a “Distribution”)
shares of Common Stock or Rights, whether or not such Rights are immediately
exercisable, convertible or exchangeable, at a Consideration Per Share lower
than the per share Fair Market Value of the Common Stock on the date of such
issuance or sale, or if the Company shall amend any of the provisions of any
Rights, including, without limitation, a change in the purchase, conversion,
exchange or exercise price per share of Common Stock of any such Right, or the
Aggregate Consideration Receivable applicable to any such Right (other than
under or by reason of provisions designed to protect against dilution upon an
event which results in an adjustment pursuant to this Article
V which is no less favorable to the Holders than such adjustment is to
the holder of such Rights), then, immediately after the date of such issuance or
sale,




13


(A)           the
number of Warrant Shares purchasable upon exercise of each Warrant shall be
increased so that the Holders thereafter will be entitled to receive the number
of Warrant Shares determined by multiplying:




(i)the
number of shares of Common Stock such Holders would have been entitled to
receive immediately before the date of such issuance or sale had such Holders
exercised their Warrants immediately prior thereto; by




(ii)a
fraction, the numerator of which shall be the sum of: (X) the number of shares
of Common Stock outstanding on such date plus
(Y) the number of additional shares of Common Stock offered for subscription or
purchase (or into which the Rights so offered are initially convertible or
exchangeable or exercisable, as the case may be), and the denominator of which
shall be the sum
of: (X) the number of shares of Common Stock outstanding on such date plus
(Y) the number of shares of Common Stock that the Aggregate Consideration
Receivable would purchase at such per share Fair Market Value of the Common
Stock on the date of such issuance or sale, and




(B)           the
Exercise Price in effect immediately after such Distribution shall be adjusted
by multiplying
the Exercise Price in effect immediately prior to such Distribution by the quotient
of:




(i)           the
sum
of: (A) the number of shares of Common Stock outstanding immediately prior to
such Distribution; plus
(B) the quotient
of: (X) the Aggregate Consideration Receivable; divided
by (Y) the per share Fair Market Value of the Common Stock; in each case
immediately prior to such Distribution; divided
by




(ii)           the
sum
of: (A) the number of shares of Common Stock outstanding immediately prior to
such Distribution; plus
(B) the number of shares of Common Stock so issued or sold (or initially
issuable pursuant to any Rights).




No
adjustment shall be made pursuant to subparagraph (A) above which would decrease
the number of shares of Common Stock purchasable upon exercise of a
Warrant.  No adjustment shall be made pursuant to subparagraph (B)
above which would increase the Exercise Price of a Warrant.




14


For
purposes of the foregoing calculation, the total maximum number of shares of
Common Stock issuable upon exercise, conversion or exchange, as applicable, of
all Rights shall be deemed to have been issued as of the date of such
Distribution and thereafter shall be deemed to be outstanding and the Company
shall be deemed to have received as consideration therefor the Aggregate
Consideration Receivable applicable thereto after giving effect to such
exercise, conversion or exchange.  Except as provided in Section
5.1(g), no additional adjustments of the Exercise Price shall be made
upon the actual exercise, exchange or conversion, as applicable, of such
Rights.




(d)Dividends
and Distributions.  In the event the Company shall, at any time
or from time to time after the date hereof, make or pay any dividend of, or
distribute to holders of Common Stock (in any such case, a “Dividend”),
shares of capital stock, any of its property or assets, including, without
limitation, cash, evidences of its indebtedness, Rights or other securities (in
each case, other than dividends payable in Common Stock) (collectively, “Dividend
Securities”), then, in each such case, the Company shall reserve shares
or other units of such Dividend Securities for distribution to the Holders upon
exercise of their Warrants so that, in addition to the Warrant Shares issuable
upon exercise thereof, such Holders will receive upon such exercise the amount
and kind of such Dividend Securities that such Holders would have received if
the Holders had, immediately prior to the record date for the distribution of
the Dividend Securities, exercised the Warrants.




(e)Self-Tenders.  If,
at any time or from time to time after the date hereof, the Company or any
subsidiary of the Company shall repurchase, by self-tender offer or otherwise,
any shares of Common Stock of the Company or any Right at a weighted average
purchase price in excess of the per share Fair Market Value of the Common Stock
then on the Business Day immediately prior to the earliest of (i) the date of
such repurchase, (ii) the commencement of an offer to repurchase or (iii) the
public announcement of either (such date being referred to as the “Determination
Date”), the Company shall (x) offer to repurchase the Warrant Shares on
the same terms and conditions on which it has offered to repurchase the shares
of Common Stock that were the subject of the self-tender or (y) offer to
repurchase the Warrants on the same terms and conditions on which it has offered
to repurchase the rights that were the subject of the
self-tender.




(f)Fair
Market Value of Consideration Received.  Notwithstanding any
provision to the contrary herein, for purposes of this Article
V, if any Rights shall be issued in connection with the issuance and sale
of other securities of the Company, together comprising one integral transaction
in which no specific consideration is allocated to such Rights by the parties
thereto, such Rights shall be deemed to have been issued without consideration,
provided,
however, that if any such Rights have an exercise price (to the extent
applicable) equal to or greater than the per share Fair Market Value of the
Common Stock on the date of issuance of such Rights, then such Rights shall be
deemed to have been issued for consideration equal to such exercise
price.




(g)Deferral
of Certain Adjustments.  No adjustment need be made for a
change in the par value of the Common Stock; provided,
however, the Company shall not increase the par value of the Common Stock
to exceed the Exercise Price.  All calculations under this Section
5.1 shall be made to the nearest 1/1,000 of one cent or to the nearest
1/1,000th of a Warrant Share, as the case may be.




15


(h)Other
Adjustments.  In the event that at any time, as a result of an
adjustment made pursuant to this Article
V, Holders shall become entitled to receive any securities of the Company
other than shares of Common Stock, thereafter the number of such other
securities so receivable upon exercise of each Warrant and the Exercise Price
applicable to such exercise shall be subject to adjustment from time to time in
a manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Warrant Shares and the Exercise Price contained in this Article
V, and all other relevant provisions of this Article
V that are applicable to shares of Common Stock shall be applicable to
such other securities.  In case at any time or from time to time the
Company shall take any action in respect of its outstanding shares of Common
Stock, other than any action described in this Article
V, or any event occurs as to which the provisions of this Article
V are not strictly applicable, then the number of Warrant Shares for
which each Warrant is exercisable shall be adjusted in such manner as may be
equitable in the circumstances and on terms as nearly equivalent as practicable
to the provisions with respect to the Warrant Shares and the Exercise Price
contained in this Article
V and as shall be reasonably necessary, in the good faith opinion of the
Board of Directors of the Company, to protect the exercise rights of the
Holders, but in no event shall any such adjustment have the effect of adversely
affecting the Holders.  If the Company shall at any time or from time
to time issue, sell or distribute any shares of capital stock (other than Common
Stock), any evidences of indebtedness, any property or assets, Rights or other
securities, then, in each such case, such issuance, sale or distribution shall
be deemed to be of, or in respect of, Common Stock for purposes of this Article
V.




(i)Statement
of Warrant Certificates.  Irrespective of any adjustment in the
number or kind of Warrant Shares issuable upon the exercise of each Warrant or
the Exercise Price, Warrant Certificates theretofore or thereafter issued shall
continue to express the same number and kind of Warrant Shares and Exercise
Price as are stated in the Warrant Certificates initially issuable pursuant to
this Warrant Agreement.




(j)Increased
Warrant Shares or Reduced Exercise Price.  From time to time,
the Company may, for a period of not less than 20 Business Days, in its
discretion, upon written notice to the Holders, increase the number of Warrant
Shares purchasable upon the exercise of each Warrant, without making any
adjustment to the Exercise Price, or reduce the Exercise Price, without making
any adjustment to the number of Warrant Shares purchasable upon the exercise of
each Warrant; provided that in the event that the Company elects to make any
such adjustment, the Company shall make the same or proportional adjustment, as
the case may be, with respect to all outstanding Warrants.




(k)No
Adjustments for Certain Incentive
Compensation.  Notwithstanding any other provision hereof, it
is expressly understood that the Warrants shall not be adjusted with respect to
(a) Common Stock or Rights, in any case, that may be issued to any of the
Company’s officers or employees pursuant to stock purchase plans, stock grant
plans, stock option plans or other similar plans of the Company that have been
approved by the Board of Directors of the Company, including, without
limitation, under the AirTran Holdings, Inc. 2002 Long Term Incentive Plan, the
AirTran Holdings, Inc. 1995 Employee Stock Purchase Plan, 1993 Incentive Stock
Options Plan, 1994 and 1996 stock option plans, Airways Corporation’s 1995 Stock
Option Plan, and Airways Corporation’s 1995 Director Stock Option Plan
(collectively, the “Plans”),
to the extent that shares of Common Stock or other securities issued or granted
under such Plans are issued or granted at a price, or with an exercise price,
that is no less than the per share Fair Market Value of the Common Stock at the
date of grant or issuance and such grant or issuance, together with all previous
grants and issuances under all such Plans, represents not more than 10% of the
fully diluted Common Stock at the time of such grant or issuance, (b) the
issuance of any Warrant Shares, or (c) the issuance of any Common Stock upon
conversion of either the Convertible Notes or the Senior Notes or the
repurchase, at maturity or otherwise, of either the Convertible Notes or the
Senior Notes.




16


(l)No
Impairment.  The Company will not, by amendment of its
certificate of incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, liquidation, issue or sale of securities or
any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms to be observed or performed hereunder by the Company, but
will at all times in good faith assist in the carrying out of all the provisions
of this Section
5.1 and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the Holders against
impairment.




(m)Further
Equitable Adjustments.  If, after one or more adjustments to
the Exercise Price pursuant to this Section
5.1, the Exercise Price cannot be reduced further without falling below
the greater of (i) the par value of the Common Stock or (ii) the lowest positive
exercise price legally permissible for warrants to acquire shares of common
stock, the Company shall make further adjustments to compensate the Holders,
consistent with the foregoing principles, as the Board of Directors of the
Company, acting in good faith, deems necessary, including an increase in the
number of Warrant Shares issuable upon exercise of outstanding Warrants and/or a
cash payment to the Holders.




(n)Other
Adjustments.




(i)Adjustments
shall be made pursuant to this Section
5.1 successively whenever any of the events referred to in Section
5.1(a) through Section
5.1(e), inclusive, shall occur.




(ii)If any
Warrant shall be exercised subsequent to the record date for any of the events
referred to in this Section
5.1, but prior to the effective date thereof, appropriate adjustments
shall be made immediately after such effective date so that the Holder of such
Warrant on such record date shall have received, in the aggregate, the kind and
number of shares of Common Stock or other securities or property or assets that
it would have owned or been entitled to receive on such effective date had such
Warrant been exercised prior to such record date.




(iii)Shares of
Common Stock owned by or held for the account of the Company shall not, for
purposes of the adjustments set forth in this Section
5.1 be deemed outstanding.




(o)Expiration
of Rights.  Upon the expiration of any Rights referred to in
this Section
5.1, without the exercise, exchange or conversion, as applicable,
thereof, the Exercise Price and the number of Warrant Shares shall, upon such
expiration, be readjusted and shall thereafter be such Exercise Price and such
number of Warrant Shares as would have been had such Exercise Price and such
number of Warrant Shares originally been adjusted (or had the original
adjustment not been required, as the case may be) as if:




17


(i)the only
shares of Common Stock so issued were the shares of Common Stock, if any,
actually issued or sold upon the exercise of such Rights;
and




(ii)such
shares of Common Stock, if any, were issued or sold for the consideration
actually received by the Company upon such exercise plus the aggregate
consideration, if any, actually received by the Company for the issuance, sale
or grant of all such Rights, whether or not exercised; provided,
however, that no such readjustment shall have the effect of increasing
the Exercise Price by an amount in excess of the amount of the reduction
initially made in respect of the issuance, sale, or grant of such
Rights.




SECTION
5.2.Fractional
Interest .  The
Company shall not be required to issue fractional shares of Common Stock on the
exercise of Warrants.  If more than one Warrant shall be presented for
exercise in full at the same time by the same Holder, the number of full shares
of Common Stock which shall be issuable upon such exercise shall be computed on
the basis of the aggregate number of shares of Common Stock which may be
acquired on exercise of the Warrants so presented.  If any fraction of
a share of Common Stock would, except for the provisions of this Section
5.2, be issuable on the exercise of any Warrant, the Company shall either
(i) pay an amount in cash calculated by the Company to equal the per share Fair
Market Value of the Common Stock multiplied
by such fraction of a share of Common Stock computed to the nearest whole
cent or (ii) aggregate all such fractional shares of Common Stock into a whole
number of shares and sell such aggregated fractional shares on behalf of the
Holders entitled thereto in a public or private sale and distribute, on a pro
rata basis, the net cash proceeds therefrom to such Holders.  While
the Company will use its best efforts to secure the best available sale price
for such aggregated fractional shares, such price shall not necessarily be the
highest price obtainable for such shares.  By their acceptances of the
Warrant Certificates, Holders expressly waive any and all rights to receive any
fraction of a share of Common Stock or a stock certificate or scrip representing
a fraction of a share of Common Stock.




SECTION
5.3.When
Adjustment Not Required .  If
the Company shall take a record of the holders of its Common Stock for the
purpose of entitling them to receive a dividend or distribution or subscription
or purchase rights and shall, thereafter and before the distribution to
stockholders thereof, legally abandon its plan to pay or deliver such dividend,
distribution, subscription or purchase rights, then thereafter no adjustment
shall be required by reason of the taking of such record and any such adjustment
previously made in respect thereof shall be rescinded and annulled.




SECTION
5.4.Treasury
Stock .  The
sale or other disposition of any issued shares of Common Stock owned or held by
or for the account of the Company shall be deemed an issuance thereof and,
except for a voluntary tender or exchange offer made by the Company or any
subsidiary of the Company subject to Section 13(e) of the Exchange Act, a
repurchase thereof and designation of such shares as treasury stock shall not be
deemed to be a redemption thereof for the purposes of this Warrant
Agreement.




18


SECTION
5.5.Notices
to Holders .  Whenever
the number of Warrant Shares is adjusted or the Exercise Price in respect
thereof is adjusted, as herein provided, the Company shall promptly give to each
Holder notice of such adjustment or adjustments and shall promptly deliver to
each Holder an Officer’s Certificate (confirmed by a certificate from the
Company’s independent certified public accountants) setting forth: (i) the
number of Warrant Shares issuable upon the exercise of each Warrant and the
Purchase Price of such shares after such adjustment; (ii) a brief statement of
the facts requiring such adjustment; and (iii) the computation by which such
adjustment was made.




So long
as any Warrant is outstanding, within ninety (90) days of the end of each fiscal
year of the Company, the Company shall deliver to each Holder an Officer’s
Certificate setting forth: (i) the number of Warrant Shares issuable upon the
exercise of each Warrant and the Exercise Price of such shares as of the end of
such fiscal year; (ii) a brief statement of the facts requiring each adjustment,
if any, required to be made in such fiscal year; and (iii) the computation by
which each such adjustment was made.






ARTICLE
VI




MISCELLANEOUS




SECTION
6.1.Defined
Terms .  Unless
otherwise defined in this Warrant Agreement, the capitalized terms set forth
below and used in this Warrant Agreement shall have the meanings given to such
terms below:




“Aggregate
Consideration Receivable” means, in the case of a sale, issuance or other
distribution of shares of Common Stock, the aggregate amount paid to the Company
in connection therewith and, in the case of an issuance, sale or other
distribution of Rights, or any amendment thereto, the sum
of: (a) the aggregate amount paid to the Company for such Rights; plus
(b) the aggregate consideration or premium stated in such Rights to be payable
for the shares of Common Stock covered thereby, in each case, without deduction
for any fees, expenses or underwriters discounts; provided,
further, that if all or any portion of the aggregate amount paid to the
Company for such Rights was not paid in cash, the amount of such consideration
other than cash received by the Company shall be deemed to be the then Fair
Market Value of such consideration.




“Business
Day” means any Monday, Tuesday, Wednesday, Thursday and Friday on which
(i) banks in New York City, or (ii) the principal national securities exchange
or market, if any, on which the Common Stock or the Warrants are listed or
admitted to trading, in each case, are not obligated by law or executive order
to be closed.




“Capitalization”
has the meaning set forth in Section
4.3.




19


“Capital
Stock” means, with respect to any person, any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate
stock and any and all warrants, options and rights with respect thereto,
including, without limitation, each class of common stock and preferred stock,
partnership interests and other indicia of ownership of such
person.




“Closing
Prices” means, per share of Common Stock or any other security, on any
date specified herein:




(i)
            the
      last sale price, regular way, on such date or, if no such sale takes place
      on such date, the average of the closing bid and asked prices on such
      date, in each case as officially reported on the principal national
      securities exchange on which the Common Stock or other security is then
      listed or admitted to trading; and




(ii)
            if
      the Common Stock or other security is not then listed or admitted to
      trading on any national securities exchange, or if there shall have been
      no trading on such date, the average of the reported closing bid and asked
      prices on such date as shown by the
NASDAQ.




“Company
Office” has the meaning set forth in Section
1.9.




“Consideration
Per Share” means, with respect to shares of Common Stock or Rights, the
quotient of: (a) the Aggregate Consideration Receivable in respect of such
shares of Common Stock or such Rights, divided
by (b) the total number of such shares of Common Stock or, in the case of
Rights, the total number of shares of Common Stock into which such Rights are
exercisable or convertible.




“Convertible
Notes” means the Company’s 7% Convertible Notes due 2023.




“Determination
Date” has the meaning set forth in Section
5.1(e).




“Distribution”has the meaning set forth in Section
5.1(c).




“Dividend”
has the meaning set forth in Section
5.1(d).




“Dividend
Securities” has the meaning set forth in Section
5.1(d).




“Election
to Exercise” has the meaning set forth in Section
2.2(b).




“Exercisability
Date” means October 31, 2008.




“Exercise
Date” has the meaning set forth in Section
2.2(e).




“Exercise
Price” has the meaning set forth in Section
2.2(a).




“Expiration
Date”has the meaning set forth in Section
2.1.




20


“Fair
Market Value” means, per share of Common Stock or any other security, as
of any date of determination, the arithmetic mean of the daily Closing Prices
for the 30 consecutive trading days before such date of determination; provided,
however, that if the Common Stock or such other security is then neither
listed or admitted to trading on any national securities exchange, or quoted by
NASDAQ, then “Fair
Market Value” means the fair market value of one share of Common Stock,
or such other security as determined by an Independent Financial Advisor as of
the date of determination.  Any such valuation by an Independent
Financial Advisor shall be based on a sale of the Company, and such valuation
shall not be discounted based on a lack of liquidity or voting rights, with
respect to any such shares, or based on a lack of control of the Company or by
the minority position of the holders of any such shares.




“Independent
Financial Advisor” means such firm of independent certified public
accountants, an investment banking or appraisal firm (which firm shall own no
equity interest of, and shall not be an affiliate, subsidiary or Related Party
of the Company) of recognized national standing to be retained by the Company
and acceptable to Holders of a majority of the outstanding
Warrants.




“Initial
Holder” has the meaning set forth in the Preamble to this
Agreement.




“Issue
Date” has the meaning set forth in Section
1.8(a).




“NASDAQ”
has the meaning set forth in Section
4.9.




“Person”
means any individual, corporation, partnership, joint venture, association,
joint stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.




“Plans”
has the meaning set forth in Section
5.1(k).




“Registrar”
has the meaning set forth in Section
1.5




“Registration
Rights Agreement” has the meaning set forth in Section
7.7.




“Related
Party” means, with respect to any Person: (A) any other Person directly
or indirectly controlling, controlled by, or under direct or indirect common
control with, such Person, (B) any spouse or immediate family member of such
Person or (C) a trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons holding a 5% or more
controlling interest of which consist of such Person and/or such other Persons
or entities referred to in the immediately preceding clause (A).  A
Person shall be deemed to control another Person if such Person possesses,
directly or indirectly, the power to direct or cause the direction of the
management and policies of such other Person, whether through the ownership of
voting securities, by contract or otherwise.




“Resale
Restriction Termination Date” has the meaning set forth in Section
1.8(a).




21


“Right”
means and includes:




(a)           any
warrant (including, without limitation, any Warrant) or any option (including,
without limitation, employee stock options) to acquire directly or indirectly
Common Stock;




(b)           any
right issued to holders of the Common Stock, or any class thereof, permitting
the holders thereof to subscribe directly or indirectly for shares of additional
Common Stock (pursuant to a rights offering or otherwise);




(c)           any
right to acquire Common Stock or pursuant to the provisions of any security
convertible directly or indirectly or exchangeable directly or indirectly into
Common Stock; and




(d)           any
similar right permitting the holder thereof directly or indirectly to subscribe
for or purchase shares of Common Stock.




“SEC”
has the meaning set forth in Section
4.5




“Securities
Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.




“Senior
Notes” means the Company’s 5.5% Convertible Senior Notes due
2015.




“Warrant
Shares” has the meaning set forth in Section
1.1.




SECTION
6.2.Amendment .  This
Warrant Agreement and the terms of the Warrants may be amended by the
Company,  without the consent of any Holder, (i) for the purpose of
curing any ambiguity, (ii) or for curing, correcting or supplementing any
defective or inconsistent provision contained herein or therein or (iii) in any
other manner which the Company may reasonably deem necessary or desirable,
which, in each of clauses (i), (ii) and (iii), shall not adversely affect in any
respect the interests of any of the Holders.




The
Company may modify this Warrant Agreement and the terms of the Warrants with the
consent of not less than a majority in number of the then outstanding Warrants
representing a majority of the Warrant Shares then issuable upon the exercise of
all then outstanding Warrants (excluding Warrants held by the Company or by any
subsidiary or affiliate of the Company) for the purpose of adding any provision
to or changing in any manner or eliminating any of the provisions of this
Warrant Agreement or modifying in any manner the rights of the Holders; provided,
however, that no such modification that increases the Exercise Price,
reduces the number of Warrant Shares purchasable upon the exercise of Warrants,
reduces the period of time during which the Warrants are exercisable hereunder,
otherwise adversely affects the exercise rights of the Holders, reduces the
percentage required for modification, or effects any change to this Section
7.1, may be made with respect to an outstanding Warrant without the
consent of the Holder of such Warrant.




22


Any
modification or amendment made in accordance with this Warrant Agreement will be
conclusive and binding on all present and future Holders whether or not they
have consented to such modification or amendment or waiver and whether or not
notation of such modification or amendment is made upon such Warrant
Certificates.  Any instrument given by or on behalf of any Holder in
connection with any consent to any modification or amendment will be conclusive
and binding on all subsequent Holders.




SECTION
6.3.Address
for Notices to the Company and for Transmission of Documents .  All
notices hereunder to the Company shall be deemed to have been given when sent by
certified or registered mail, postage prepaid, or by telecopy, confirmed by
first class mail, postage prepaid, addressed as follows:




To the
Company:


AirTran
Holdings, Inc.


9955
AirTran Boulevard


Orlando,
FL 32827


Telecopy:
(407) 318-5925


Telephone:
(407) 318-5000


Attention:
Treasurer




With a
copy (which shall not constitute notice) to:




Smith,
Gambrell & Russell, LLP


1230
Peachtree Street, N.E.


Promenade
II, Suite 3100


Atlanta,
GA  30309


Telecopy:
(404) 685-6894


Telephone:
(404) 815-3594


Attention:
Howard E. Turner, Esq. or M. Timothy Elder, Esq.




SECTION
6.4.Notices
to Holders .  Notices
to Holders shall be mailed to such Holders at the addresses of such Holders as
they appear in the Warrant Register.  Any such notice shall be
sufficiently given if sent by first-class mail, postage prepaid.




SECTION
6.5.Applicable
Law .  THE
VALIDITY, INTERPRETATION AND PERFORMANCE OF THIS WARRANT AGREEMENT AND EACH
WARRANT ISSUED HEREUNDER AND OF THE RESPECTIVE TERMS AND PROVISIONS THEREOF
SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
THE CONFLICT OF LAW PROVISIONS THEREOF.




SECTION
6.6.Obtaining
of Governmental Approvals .  The
Company will use its reasonable best efforts to take, from time to time, all
action required to be taken by it which may be necessary to obtain and keep
effective any and all permits, consents and approvals of governmental agencies
and authorities and securities laws filings under United States federal and
State laws, and the rules and regulations of all stock exchanges or markets on
which the Common Stock may be listed, which may be or become requisite in
connection with the issuance, sale, transfer, and delivery of the Warrant
Certificates, the exercise of the Warrants or the issuance, sale, transfer and
delivery of the Warrant Shares, it being understood, however, that the only
contractual registration rights of the Holders are those set forth in the
Registration Rights Agreement in respect of the Warrants, dated of even date
herewith (the “Registration
Rights Agreement”), between the Company and the Initial
Holder.




23


SECTION
6.7.Persons
Having Rights Under Agreement .  Nothing
in this Warrant Agreement expressed or implied and nothing that may be inferred
from any of the provisions hereof is intended, or shall be construed, to confer
upon, or give to, any Person other than the Company (or any agents of the
Company) and the Holders from time to time of the Warrant Certificates, any
right, remedy or claim under or by reason of this Warrant Agreement or of any
covenant, condition, stipulation, promise or agreement hereof and all covenants,
conditions, stipulations, promises and agreements in this Warrant Agreement
contained shall be for the sole and exclusive benefit of the Company (and any
agents of the Company) and the Holders from time to time of the Warrant
Certificates.




SECTION
6.8.Headings .  The
descriptive headings of the several Articles and Sections of this Warrant
Agreement are inserted for convenience of reference only and shall not control
or affect the meaning or construction of any of the provisions
hereof.




SECTION
6.9.Counterparts .  This
Warrant Agreement may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original; but such Counterparts shall
together constitute but one and the same instrument.




SECTION
6.10.Inspection
of Warrant Agreement .  A
copy of this Warrant Agreement shall be available at all reasonable times at the
Company Office, for inspection by the Holder of any Warrant
Certificate.  The Company may require such Holder to submit his
Warrant Certificate for inspection by it.




SECTION
6.11.Successors .  All
the covenants and provisions of this Warrant Agreement by or for the benefit of
the Company (or any agents of the Company) shall bind and inure to the benefit
of their respective successors and assigns hereunder.




* * * *
*




24


IN
WITNESS WHEREOF, this Warrant Agreement has been duly executed by the Company
and the Initial Holder as of the day and year first above written.








[Signatures
on Following Pages]



















AIRTRAN HOLDINGS,
INC.








By:


Name:  Richard
P. Magurno


Title:    SVP





































BANK OF
UTAH, not in its individual capacity but as Trustee under that certain Trust
Agreement dated October 30, 2008








By:


Name:


Title: