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Exhibit 10.9    
  


 
  FORM OF
  PINNACLE AIRLINES CORP.
  2002 STOCK INCENTIVE PLAN    
  


1.    Purpose of the Plan  


        The purpose of the Plan is to aid the Company and its Affiliates in recruiting and retaining key employees, directors of outstanding ability and to motivate such
employees, directors to exert their best efforts on behalf of the Company and its Affiliates by providing incentives through the granting of Awards. The Company expects that it will benefit from the
added interest which such key employees, directors will have in the welfare of the Company as a result of their proprietary interest in the Company's success. 


2.    Definitions  


        The following capitalized terms used in the Plan have the respective meanings set forth in this Section: 



	(a)
	Act: The Securities Exchange Act of 1934, as amended, or any successor thereto.



	(b)
	Affiliate: With respect to the Company, any entity directly or indirectly controlling, controlled by, or under common control with, the
Company or any other entity designated by the Board in which the Company or an Affiliate has an interest.



	(c)
	Award: An Option, Stock Appreciation Right or Other Stock-Based Award granted pursuant to the Plan.



	(d)
	Beneficial Owner: A "beneficial owner", as such term is defined in Rule 13d-3 under the Act (or any successor rule
thereto).



	(e)
	Board: The Board of Directors of the Company.



	(f)
	Change in Control: The occurrence of any of the following events:



	(i)
	the
sale or disposition, in one or a series of related transactions, of all or substantially all, of the assets of the Company to any "person" or
"group" (as such terms are defined in Sections 13(d)(3) or 14(d)(2) of the Act) other than the Permitted Holders;



	(ii)
	any
person or group, other than the Permitted Holders, is or becomes the Beneficial Owner (except that a person shall be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 50% of
the total voting power of the voting stock of the Company (or any entity which controls the Company), including by way of merger, consolidation, tender or exchange offer or otherwise; or



	(iii)
	during
any period of two consecutive years, individuals who at the beginning of such period constituted the Board (together with any new directors
whose election by such Board or whose nomination for election by the shareholders of the Company was approved by a vote of a majority of the directors of the Company, then still in office, who were
either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board, then in office. 









	(g)
	Code: The Internal Revenue Code of 1986, as amended, or any successor thereto.



	(h)
	Committee: The Compensation Committee of the Board.



	(i)
	Company: Pinnacle Airlines Corp., a Delaware corporation. 






 



	(j)
	Effective Date: The date the Board approves the Plan, or such later date as is designated by the Board.



	(k)
	Fair Market Value: On a given date, (i) if there should be a public market for the Shares on such date, the arithmetic mean of
the high and low prices of the Shares as reported on such date on the Composite Tape of the principal national securities exchange on which such Shares are listed or admitted to trading, or, if the
Shares are not listed or admitted on any national securities exchange, the arithmetic mean of the per Share closing bid price and per Share closing asked price on such date as quoted on the National
Association of Securities Dealers Automated Quotation System (or such market in which such prices are regularly quoted)(the "NASDAQ"), or, if no sale of
Shares shall have been reported on the Composite Tape of any national securities exchange or quoted on the NASDAQ on such date, then the immediately preceding date on which sales of the Shares have
been so reported or quoted shall be used, and (ii) if there should not be a public market for the Shares on such date, the Fair Market Value shall be the value established by the Committee in
good faith.



	(l)
	ISO: An Option that is also an incentive stock option granted pursuant to Section 6(c) of the Plan.



	(m)
	LSAR: A limited stock appreciation right granted pursuant to Section 7(d) of the Plan.



	(n)
	Other Stock-Based Awards: Awards granted pursuant to Section 8 of the Plan.



	(o)
	Option: A stock option granted pursuant to Section 6 of the Plan.



	(p)
	Option Price: The purchase price per Share of an Option, as determined pursuant to Section 6(a) of the Plan.



	(q)
	Participant: An employee, director who is selected by the Committee to participate in the Plan.



	(r)
	Permitted Holder means, as of the date of determination, any employee benefit plan (or trust forming a part thereof) maintained by
(A) the Company or (B) any corporation or other Person of which a majority of its voting power of its voting equity securities or equity interest is owned, directly or indirectly, by the
Company.



	(s)
	Performance-Based Awards: Certain Other Stock-Based Awards granted pursuant to Section 8(b) of the Plan.



	(t)
	Person: A "person", as such term is used for purposes of Section 13(d) or 14(d) of the Act (or any successor section thereto).



	(u)
	Plan: The Pinnacle Airlines Corp. 2002 Stock Incentive Plan.



	(v)
	Shares: Shares of common stock of the Company.



	(w)
	Stock Appreciation Right: A stock appreciation right granted pursuant to Section 7 of the Plan.



	(x)
	Subsidiary: A subsidiary corporation, as defined in Section 424(f) of the Code (or any successor section thereto). 




3.    Shares Subject to the Plan  


        The total number of Shares which may be issued under the Plan is [            ]. The maximum number of Shares for which
Options and
Stock Appreciation Rights may be granted during a calendar year to any Participant shall be [    ]. The Shares may consist, in whole or in part, of unissued Shares or
treasury Shares. The issuance of Shares or the payment of cash upon the exercise of an Award or in consideration of the cancellation or termination of an Award shall reduce the total number of Shares 


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available under the Plan, as applicable. Shares which are subject to Awards which terminate or lapse without the payment of consideration may be granted again under the Plan. 



4.    Administration  


        The Plan shall be administered by the Committee, which may delegate its duties and powers in whole or in part to any subcommittee thereof consisting solely of at
least two individuals who are intended to qualify as "Non-Employee Directors" within the meaning of Rule 16b-3 under the Act (or any successor rule thereto) and "outside
directors" within the meaning of Section 162(m) of the Code (or any successor section thereto). Awards may, in the discretion of the Committee, be made under the Plan in assumption of, or in
substitution for, outstanding awards previously granted by the Company or its affiliates or a company acquired by the Company or with which the Company combines. The number of Shares underlying such
substitute awards shall be counted against the aggregate number of Shares available for Awards under the Plan. The Committee is authorized to interpret the Plan, to establish, amend and rescind any
rules and regulations relating to the Plan, and to make any other determinations that it deems necessary or desirable for the administration of the Plan. The Committee may correct any defect or supply
any omission or reconcile any inconsistency in the Plan in the manner and to the extent the Committee deems necessary or desirable. Any decision of the Committee in the interpretation and
administration of the Plan, as described herein, shall lie within its sole and absolute discretion and shall be final, conclusive and binding on all parties concerned (including, but not limited to,
Participants and their beneficiaries or successors). The Committee shall have the full power and authority to establish the terms and conditions of any Award consistent with the provisions of the Plan
and to waive any such terms and conditions at any time (including, without limitation, accelerating or waiving any vesting conditions). The Committee shall require payment of any amount it may
determine to be necessary to withhold for federal, state, local or other taxes as a result of the exercise of an Award. 


5.    Limitations  


        No Award may be granted under the Plan after the tenth anniversary of the Effective Date, but Awards theretofore granted may extend beyond that date. 



6.    Terms and Conditions of Options  


        Options granted under the Plan shall be, as determined by the Committee, non-qualified or incentive stock options for federal income tax purposes, as
evidenced by the related Award agreements, and shall be subject to the foregoing and the following terms and conditions and to such other terms and conditions, not inconsistent therewith, as the
Committee shall determine: 



	(a)
	Option Price; Exercisability. Options granted under the Plan shall have a Option Price, and shall be exercisable at such time and upon
such terms and conditions, as may be determined by the Committee.



	(b)
	Exercise of Options. Except as otherwise provided in the Plan or in an Award agreement, an Option may be exercised for all, or from
time to time any part, of the Shares for which it is then exercisable. For purposes of Section 6 of the Plan, the exercise date of an Option shall be the later of the date a notice of exercise
is received by the Company and, if applicable, the date payment is received by the Company pursuant to clauses (i), (ii) or (iii) in the following sentence. The purchase price for the
Shares as to which an Option is exercised shall be paid to the Company in full at the time of exercise at the election of the Participant (i) in cash or its equivalent (e.g., by check),
(ii) to the extent permitted by the Committee, in Shares having a Fair Market Value equal to the aggregate Option Price for the Shares being purchased and satisfying such other requirements as
may be imposed by the Committee; provided, that such 



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Shares
have been held by the Participant for no less than six months (or such other period as established from time to time by the Committee in order to avoid adverse accounting treatment applying
generally accepted accounting principles), (iii) partly in cash and, to the extent permitted by the Committee, partly in such Shares or (iv) through the delivery of irrevocable
instructions to a broker to sell Shares obtained upon the exercise of the Option and to deliver promptly to the Company an amount out of the proceeds of such Sale equal to the aggregate option price
for the Shares being purchased. No Participant shall have any rights to dividends or other rights of a stockholder with respect to Shares subject to an Option until the Participant has given written
notice of exercise of the Option, paid in full for such Shares and, if applicable, has satisfied any other conditions imposed by the Committee pursuant to the Plan. 



	(c)
	ISOs. The Committee may grant Options under the Plan that are intended to be ISOs. Such ISOs shall comply with the requirements of
Section 422 of the Code (or any successor section thereto). No ISO may be granted to any Participant who at the time of such grant, owns more than ten percent of the total combined voting power
of all classes of stock of the Company or of any Subsidiary, unless (i) the Option Price for such ISO is at least 110% of the Fair Market Value of a Share on the date the ISO is granted and
(ii) the date on which such ISO terminates is a date not later than the day preceding the fifth anniversary of the date on which the ISO is granted. Any Participant who disposes of Shares
acquired upon the exercise of an ISO either (i) within two years after the date of grant of such ISO or (ii) within one year after the transfer of such Shares to the Participant, shall
notify the Company of such disposition and of the amount realized upon such disposition. All Options granted under the Plan are intended to be nonqualified stock options, unless the applicable Award
Agreement expressly states that the Option is intended to be an ISO. If an Option is intended to be an ISO, and if for any reason such Option (or portion thereof) shall not qualify as an ISO, then, to
the extent of such nonqualification, such Option (or portion thereof) shall be regarded as a nonqualified stock option granted under the Plan; provided that such Option (or potion thereof) otherwise
complies with the Plan's requirements relating to nonqualified stock options. In no event shall any member of the Committee, the Company or any of its Affiliates (or their respective employees,
officers or directors) have any liability to any Participant (or any other Person) due to the failure of an Option to qualify for any reason as an ISO.



	(d)
	Attestation. Wherever in this Plan or any agreement evidencing an Award a Participant is permitted to pay the exercise price of an
Option or taxes relating to the exercise of an Option by delivering Shares, the Participant may, subject to procedures satisfactory to the Committee, satisfy such delivery requirement by presenting
proof of beneficial ownership of such Shares, in which case the Company shall treat the Option as exercised without further payment and shall withhold such number of Shares from the Shares acquired by
the exercise of the Option. 




7.    Terms and Conditions of Stock Appreciation Rights  



	(a)
	Grants. The Committee also may grant (i) a Stock Appreciation Right independent of an Option or (ii) a Stock Appreciation
Right in connection with an Option, or a portion thereof. A Stock Appreciation Right granted pursuant to clause (ii) of the preceding sentence (A) may be granted at the time the related
Option is granted or at any time prior to the exercise or cancellation of the related Option, (B) shall cover the same number of Shares covered by an Option (or such lesser number of Shares as
the Committee may determine) and (C) shall be subject to the same terms and conditions as such Option except for such additional limitations as are contemplated by this Section 7 (or
such additional limitations as may be included in an Award agreement). 



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	(b)
	Terms. The exercise price per Share of a Stock Appreciation Right shall be an amount determined by the Committee. Each Stock
Appreciation Right granted independent of an Option shall entitle a Participant upon exercise to an amount equal to (i) the excess of (A) the Fair Market Value on the exercise date of
one Share over (B) the exercise price per Share, times (ii) the number of Shares covered by the Stock Appreciation Right. Each Stock Appreciation Right granted in conjunction with an
Option, or a portion thereof, shall entitle a Participant to surrender to the Company the unexercised Option, or any portion thereof, and to receive from the Company in exchange therefore an amount
equal to (i) the excess of (A) the Fair Market Value on the exercise date of one Share over (B) the Option Price per Share, times (ii) the number of Shares covered by the
Option, or portion thereof, which is surrendered. The date a notice of exercise is received by the Company shall be the exercise date. Payment shall be made in Shares or in cash, or partly in Shares
and partly in cash (any such Shares valued at such Fair Market Value), all as shall be determined by the Committee. Stock Appreciation Rights may be exercised from time to time upon actual receipt by
the Company of written notice of exercise stating the number of Shares with respect to which the Stock Appreciation Right is being exercised. No fractional Shares will be issued in payment for Stock
Appreciation Rights, but instead cash will be paid for a fraction or, if the Committee should so determine, the number of Shares will be rounded downward to the next whole Share.



	(c)
	Limitations. The Committee may impose, in its discretion, such conditions upon the exercisability or transferability of Stock
Appreciation Rights as it may deem fit.



	(d)
	Limited Stock Appreciation Rights. The Committee may grant LSARs that are exercisable upon the occurrence of specified contingent
events. Such LSARs may provide for a different method of determining appreciation, may specify that payment will be made only in cash and may provide that any related Awards are not exercisable while
such LSARs are exercisable. Unless the context otherwise
requires, whenever the term "Stock Appreciation Right" is used in the Plan, such term shall include LSARs. 




8.    Other Stock-Based Awards  



	(a)
	Generally. The Committee, in its sole discretion, may grant or sell Awards of Shares, Awards of restricted Shares and Awards that are
valued in whole or in part by reference to, or are otherwise based on the Fair Market Value of, Shares ("Other Stock-Based Awards"). Such Other
Stock-Based Awards shall be in such form, and dependent on such conditions, as the Committee shall determine, including, without limitation, the right to receive, or vest with respect to, one or more
Shares (or the equivalent cash value of such Shares) upon the completion of a specified period of service, the occurrence of an event and/or the attainment of performance objectives. Other Stock-Based
Awards may be granted alone or in addition to any other Awards granted under the Plan. Subject to the provisions of the Plan, the Committee shall determine: (i) to whom and when Other
Stock-Based Awards will be made; (ii) the number of Shares to be awarded under (or otherwise related to) such Other Stock-Based Awards; (iii) whether such Other Stock-Based Awards shall
be settled in cash, Shares or a combination of cash and Shares; and (iv) all other terms and conditions of such Awards (including, without limitation, the vesting provisions thereof and
provisions ensuring that all Shares so awarded and issued shall be fully paid and non-assessable).



	(b)
	Performance-Based Awards. Notwithstanding anything to the contrary herein, certain Other Stock-Based Awards granted under this
Section 8 may be granted in a manner which is deductible by the Company under Section 162(m) of the Code (or any successor section thereto) ("Performance-Based
Awards"). A Participant's Performance-Based Award shall be determined based on the attainment of written performance goals approved by the Committee 



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for
a performance period established by the Committee (i) while the outcome for that performance period is substantially uncertain and (ii) no more than 90 days after the
commencement of the performance period to which the performance goal relates or, if less, the number of days which is equal to 25 percent of the relevant performance period. The performance
goals, which must be objective, shall be based upon one or more of the following criteria: (i) consolidated earnings before or after taxes (including earnings before interest, taxes,
depreciation and amortization); (ii) net income; (iii) operating income; (iv) earnings per Share; (v) book value per Share; (vi) return on shareholders' equity;
(vii) expense management; (viii) return on investment; (ix) improvements in capital structure; (x) profitability of an identifiable business unit or product;
(xi) maintenance or improvement of profit margins; (xii) stock price; (xiii) market share; (xiv) revenues or sales; (xv) costs; (xvi) cash flow;
(xvii) working capital and (xviii) return on assets. The foregoing criteria may relate to the Company, one or more of its Subsidiaries or one or more of its divisions or units, or any
combination of the foregoing, and may be applied on an absolute basis and/or be relative to one or more peer group companies or indices, or any combination thereof, all as the Committee shall
determine. In addition, to the degree consistent with Section 162(m) of the Code (or any successor section thereto), the performance goals may be calculated without regard to extraordinary
items. The maximum amount of a Performance-Based Award during a calendar year to any Participant shall be: (x) with respect to
Performance-Based Awards that are Options, [ ] Shares and (y) with respect to Performance-Based Awards that are not Options, $[AMOUNT]. The
Committee shall determine whether, with respect to a performance period, the applicable performance goals have been met with respect to a given Participant and, if they have, to so certify and
ascertain the amount of the applicable Performance-Based Award. No Performance-Based Awards will be paid for such performance period until such certification is made by the Committee. The amount of
the Performance-Based Award actually paid to a given Participant may be less than the amount determined by the applicable performance goal formula, at the discretion of the Committee. The amount of
the Performance-Based Award determined by the Committee for a performance period shall be paid to the Participant at such time as determined by the Committee in its sole discretion after the end of
such performance period; provided, however, that a Participant may, if and to the extent permitted by the Committee and consistent with the provisions of Section 162(m) of the Code, elect to
defer payment of a Performance-Based Award. 





9.    Adjustments Upon Certain Events  


        Notwithstanding any other provisions in the Plan to the contrary, the following provisions shall apply to all Awards granted under the Plan: 



	(a)
	Generally. In the event of any change in the outstanding Shares after the Effective Date by reason of any Share dividend or split,
reorganization, recapitalization, merger, consolidation, spin-off, combination or transaction or exchange of Shares or other corporate exchange, or any distribution to shareholders of
Shares other than regular cash dividends or any transaction similar to the foregoing, the Committee in its sole discretion and without liability to any person may make such substitution or adjustment,
if any, as it deems to be equitable, as to (i) the number or kind of Shares or other securities issued or reserved for issuance pursuant to the Plan or pursuant to outstanding Awards,
(ii) the maximum number of Shares for which Options or Stock Appreciation Rights may be granted during a calendar year to any Participant, (iii) the maximum amount of a Performance-Based
Award that may be granted during a calendar year to any Participant, (iv) the Option Price or exercise price of any Stock Appreciation Right and/or (v) any other affected terms of such
Awards.



	(b)
	Change in Control. [In the event of a Change of Control after the Effective Date, the Committee may, but shall not be
obligated to, (A) cancel such Awards for fair value (as 



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determined
in the sole discretion of the Committee) which, in the case of Options and Stock Appreciation Rights, may equal the excess, if any, of the Fair Market Value of the Shares subject to such
Options or Stock Appreciation Rights over the aggregate exercise price of such Options or Stock Appreciation Rights or (B) provide for the issuance of substitute Awards that will substantially
preserve the otherwise applicable terms of any affected Awards previously granted hereunder as determined by the Committee in its sole discretion.] 





10.  No Right to Employment or Awards  


        The granting of an Award under the Plan shall impose no obligation on the Company or any Affiliate to continue the employment of, or service relationship with, a
Participant and shall not lessen or affect the Company's or Affiliate's right to terminate the employment of, or service relationship with such Participant. No Participant or other Person shall have
any claim to be granted any Award, and there is no obligation for uniformity of treatment of Participants, or holders or beneficiaries of Awards. The terms and conditions of Awards and the Committee's
determinations and interpretations with respect thereto need not be the same with respect to each Participant (whether or not such Participants are similarly situated). 


11.  Successors and Assigns  


        The Plan shall be binding on all successors and assigns of the Company and a Participant, including without limitation, the estate of such Participant and the
executor, administrator or trustee of such estate, or any receiver or trustee in bankruptcy or representative of the Participant's creditors. 



12.  Nontransferability of Awards  


        Unless otherwise determined by the Committee, an Award shall not be transferable or assignable by the Participant otherwise than by will or by the laws of descent
and distribution. An Award exercisable after the death of a Participant may be exercised by the legatees, personal representatives or distributees of the Participant. 


13.  Amendments or Termination  


        The Board may amend, alter or discontinue the Plan, but no amendment, alteration or discontinuation shall be made which, (a) without the approval of the
shareholders of the Company, would (except as is provided in Section 9 of the Plan), increase the total number of Shares reserved for the purposes of the Plan or change the maximum number of
Shares for which Awards may be granted to any Participant or (b) without the consent of a Participant, would diminish any of the rights of the Participant under any Award theretofore granted to
such Participant under the Plan; provided, however, that the Committee may amend the Plan in such manner as it deems necessary to permit the granting of Awards meeting the requirements of the Code or
other applicable laws. 


14.  International Participants  


        With respect to Participants who reside or work outside the United States of America and who are not (and who are not expected to be) "covered employees" within
the meaning of Section 162(m) of the Code, the Committee may, in its sole discretion, amend the terms of the Plan or Awards with respect to such Participants in order to conform such terms with
the provisions of local law, and the Committee may, where appropriate, establish one or more sub-plans to reflect such amended or varied provisions. 


15.  Choice of Law  


        The Plan shall be governed by and construed in accordance with the laws of the State of Delaware without regard to conflicts of laws. 



16.  Effectiveness of the Plan  


        The Plan shall be effective as of the Effective Date, subject to the approval of the shareholders of the Company. 


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Exhibit 10.9


FORM OF PINNACLE AIRLINES CORP. 2002 STOCK INCENTIVE PLAN