<PAGE>   1

                                                                   EXHIBIT 10.24

                              ARTICLES OF AGREEMENT

                                     BETWEEN

                           PETROLEUM HELICOPTERS, INC.

                                        &

      OFFICE & PROFESSIONAL EMPLOYEES INTERNATIONAL UNION AND ITS LOCAL 108


                   EFFECTIVE JUNE 1, 2001 THROUGH MAY 31, 2004
                                REVISION 7.12.01


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<Table>
<Caption>
                               TABLE OF CONTENTS                                     PAGE
                               -----------------                                     ----
<S>         <C>                                                                      <C>
Preamble                                                                               1
Article 1.  Purpose of Agreement                                                       2
Article 2.  Recognition                                                                3
Article 3.  Pilot Status                                                               4
Article 4.  Nondiscrimination                                                          5
Article 5.  Seniority                                                                  6
Article 6.  Seniority List                                                             7
Article 7.  Reductions in Work Force                                                   8
Article 8.  Categories of Aircraft                                                     9
Article 9.  Job Posting & Bidding                                                     10
Article 10. Schedules of Service                                                      13
Article 11. Leaves of Absence                                                         14
Article 12. Paid Days Off and Banked Days                                             16
Article 13. On the Job Injury/Workers' Compensation                                   19
Article 14. Bereavement Leave                                                         21
Article 15. Jury Duty                                                                 22
Article 16. Fees and Physical Examinations                                            23
Article 17. Training                                                                  24
Article 18. Facilities, Equipment and Uniforms                                        28
Article 19. Severance Pay                                                             31
Article 20. Moving Expense                                                            32
Article 21. Base Pay                                                                  34
Article 22. Pilot Bonuses                                                             37
Article 23. Other Bonuses                                                             38
Article 24. Workover                                                                  39
Article 25. Travel Pay                                                                42
Article 26. Per Diem                                                                  43
Article 27. Insurance Benefits                                                        44
Article 28. 401(k) Plan                                                               45
Article 29. General & Miscellaneous                                                   46
Article 30. Safety/Accident Prevention                                                48
Article 31. Sexual and Workplace Harassment Policy                                    49
Article 32. Environmental Compliance                                                  50
Article 33. No Strike, No Lockout                                                     51
Article 34. Management Rights                                                         52
Article 35. Discipline and Discharge                                                  53
Article 36. Grievance Procedure                                                       54
Article 37. System Board of Adjustment                                                56
Article 38. Union Representation                                                      58
Article 39. Union Bulletin Boards & Communications                                    60
Article 40. Union Membership, Dues, Agency Fees & Checkoff                            61
Article 41. Savings Clause                                                            63
Article 42. Duration                                                                  64
</Table>


<PAGE>   3

                           PETROLEUM HELICOPTERS, INC.
                               EMPLOYER PROPOSALS

                                    AGREEMENT

         This Agreement is entered into between Petroleum Helicopters, Inc.,
hereinafter called "the Employer," and Office and Professional Employees
International Union, and its Local 108, hereinafter jointly called "the Union"
or "the OPEIU."






                                       1
<PAGE>   4

                         ARTICLE 1. PURPOSE OF AGREEMENT

         1. The purpose of this Agreement is to define the wages, hours and
other terms and conditions of employment of the Flight Deck Crew members
(hereinafter called "pilots") covered by this Agreement.

         2. No pilot covered by this Agreement will be interfered with,
restrained, coerced or discriminated against by the Employer or the Union, their
officers or their agents, because of membership or non-membership in the union,
or any lawful activity under the Railway Labor Act not in violation of this
Agreement.

         3. Whenever the male gender is used in this Agreement, it is understood
that it is referring to both male and female pilots.

         4. This Agreement sets forth the entire understanding and agreement of
the parties and may not be modified in any respect except by writing subscribed
to by the parties. This Agreement supercedes all previous agreements,
commitments or practices, oral or written, between the Employer and the Union
and/or the pilots, and expresses all of the obligations of and restrictions
imposed upon each of the respected parties during its term. The waiver of any
provision of this Agreement or any breach of this Agreement by either party
during the term of the Agreement shall not constitute a precedent for the future
waiver of any breach or provision. Nothing in this Agreement shall prohibit the
parties from bargaining on any issue they desire if both parties mutually agree
to do so during the term of this Agreement.





                                       2
<PAGE>   5

                             ARTICLE 2. RECOGNITION

         1. The Employer recognizes the Union as the exclusive bargaining
representative of, and this Agreement applies only to, all flight deck
crewmembers employed by Petroleum Helicopters, Inc. in the United States, its
territories and possessions.

         2. The Employer may subcontract pilots and/or aircraft with pilots
(collectively know as "Subcontracting") for a period not to exceed one hundred
and eighty (180) days per occurrence during the term of the Agreement when (i)
Subcontracting is necessary for the Employer to continue its operations, (ii)
the Employer determines that it does not have sufficient aircraft, or
appropriate aircraft type(s), or it lacks sufficient pilots, or its pilots are
not appropriately trained for such Subcontracting work, (iii) the temporary and
occasional use of Subcontracting is required for Fixed Wing operations and (iv)
the Employer does not furlough any pilot as a direct result of such
Subcontracting. It is understood and agreed that nothing in this paragraph shall
prevent the Employer from furloughing or terminating pilots in accordance with
the provisions of this Agreement due to business or economic reasons independent
of, and unrelated to Subcontracting.

         3. Notwithstanding Section 2 above, in the event the Employer is
required to Subcontract due to circumstances beyond its control, the Employer
may Subcontract for a time not to exceed the duration of the such circumstance
or twelve (12) months, whichever is less. Circumstances beyond the Employer's
control shall include (i) an act of nature, (ii) a strike affecting the
Employer's business, (iii) grounding of a significant number of the Employer's
aircraft by a governmental agency or court, (iv) loss or destruction of the
Employer's aircraft, (v) an act or declaration of war affecting directly or
indirectly the Employer's operations, or (vi) an owner's or manufacturer's delay
in the delivery of aircraft scheduled for delivery.

         4. In the event the employer sells all or part of its helicopter
operations to another carrier during the term of this Agreement, in advance of
such sale, the employer shall give notice of the existence of this Agreement to
such successor carrier and shall make reasonable effort to persuade such
successor carrier to agree to the continuation of the economic terms set forth
in this Agreement.

         5. All revenue and all known and recurring miscellaneous flying
performed by the Employer will be performed by pilots on its payroll, except as
provided in Sections 2 and 3 above.





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<PAGE>   6

                             ARTICLE 3. PILOT STATUS


         1. All pilots covered by this Agreement are on probation for the first
six months of their employment by the Employer.

         2. Probationary pilots shall be entitled to all rights and benefits
under this agreement except that such pilots may not utilize the provisions of
this Agreement concerning any corrective actions taken by the Employer in
connection with the pilot's performance or conduct or any disciplinary actions,
up to and including discharge.

         3. After a new pilot completes the Employer's new employee orientation,
he will be introduced to a union representative for the purpose of discussing
union membership.






                                       4
<PAGE>   7

                          ARTICLE 4. NONDISCRIMINATION

         1. The Employer and the Union agree to comply with all applicable laws
prohibiting discrimination on the basis of race, color, religion, national
origin, sex, age, disability or Vietnam-era veteran status.






                                       5
<PAGE>   8

                              ARTICLE 5. SENIORITY

         1. There shall be two types of seniority:

            A.    Company seniority- Company seniority shall be defined as the
                  pilot's length of employment from date of hire with the
                  Employer, adjusted for any breaks in service as defined in
                  Section 2 of this Article. Company seniority shall be used for
                  determining eligibility for, and the level of, all benefits.

            B.    Bidding seniority- Bidding seniority shall be defined as the
                  pilot's length of employment as a pilot with the Employer.

         2. Company seniority shall be adjusted for any breaks in employment
with PHI of one (1) year or less, except as provided in Article 7. Reduction in
Force, Section 6.

         3. If a pilot is assigned to a position not covered by this agreement,
he shall have no rights under this agreement, except that pilots on foreign
assignment, pilots on assignment as managers and supervisors on the date this
Agreement is executed, and no more than one pilot elected or appointed to a
position with the Local Union shall continue to accrue company and bidding
seniority. Pilots who are assigned to management or supervision following the
date this Agreement is executed shall continue to accrue bidding seniority for
one (1) year after being placed in the position, and shall thereafter retain all
such seniority.

         4. A pilot shall lose all seniority rights and have his name removed
from the seniority list under the following conditions:

            A.    resignation or retirement;

            B.    discharge;

            C.    absent from work for forty-eight (48) consecutive hours
                  without proper notification of the reason to the Director of
                  Operations or his designee, unless the Employer determines the
                  pilot is physically incapable of providing the Employer with
                  the proper notification of his absence;

            D.    failure to return to work from an authorized leave of absence
                  in the time provided by the Employer, giving a false reason
                  for obtaining a leave of absence or accepting gainful
                  employment while on a leave of absence (when the employment
                  was not specifically authorized by the Employer);

            E.    failure to inform Human Resources in person or by certified
                  mail of his intention to return to work or failure to return
                  to work on or before a date specified in the notice of recall
                  as provided for in Article 7, Section 8(A); or

            F.    a pilot who is furloughed and who is not recalled to service
                  with the Employer within thirty-six (36) months from the date
                  of furlough.





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<PAGE>   9

                            ARTICLE 6. SENIORITY LIST

         1. The pilot seniority list shall consist of the seniority number, name
and seniority dates of all pilots covered by this agreement. The Employer will
post the seniority list at all work locations where pilots covered by this
agreement are assigned. A copy of the seniority list will be furnished to the
Union in computer floppy disk form with leave of absence and new hire
designations.

         2. When two or more pilots are employed on the same date, they shall be
placed on the seniority list according to their date of birth with the eldest
pilot having the most seniority. If two or more pilots are employed on the same
date and have the same date of birth, the pilot who has the lowest last four
digits in his social security number shall have the most seniority.

         3. The Employer agrees to update and distribute as described above the
seniority list once each month with the effective date of this agreement. A
pilot shall have a period of thirty (30) days after the posting of the seniority
list to protest to the Employer any omission or incorrect posting affecting his
bidding seniority. Once the thirty (30) day period has expired without a
protest, a pilot's posting shall be considered correct and shall not be subject
to further protest unless the omission or incorrect posting was the result of a
clerical error on the part of the Employer.







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<PAGE>   10

                       ARTICLE 7. REDUCTIONS IN WORK FORCE


         1. If there is a loss or reduction of an Aeromedical contract, the
affected pilot(s) assigned to that contract will be placed in the Oil & Gas
pilot pool, except as described in section 2 below. If there is a loss or
reduction of an Oil & Gas contract, the affected pilot(s) assigned to that
contract will be placed in the Oil & Gas pilot pool. If a reduction in force is
necessary in any other business unit, the affected helicopter pilot(s) will be
placed in the Oil & Gas pilot pool. If a reduction in force is necessary in Oil
& Gas, a pilot's bidding seniority shall determine the order of layoff, with the
least senior pilot laid off first.

         2. Pilots hired for a specific contract (i.e., Aeromedical) may be
exempted from general layoffs; however, they may be subject to layoff upon
termination of that specific contract.

         3. If the customer owns or dry leases the aircraft and retains the
right to select pilots for these aircraft, the customer retains the right to
exempt pilots from layoff.

         4. The Employer shall provide the Union with reasonable notice of an
impending reduction in force affecting pilots under this Agreement, in order to
permit the parties to discuss alternative options. Such notice and discussions
shall be waived when circumstances beyond the control of the employer require
immediate action.

         5. Pilots with seniority rights will be recalled from furlough into the
pilot pool in bidding seniority order, with the most senior laid off pilot being
recalled first. In the event vacant jobs in Aeromedical cannot be filled from
within, furloughed pilots will be offered such jobs in bidding seniority order.
However, furloughed pilots, who would be required to relocate, will not be
removed from the seniority list if they choose not to accept the vacant
Aeromedical job offered.

         6. Pilots who are furloughed shall continue to accrue bidding seniority
for as long as they have seniority rights. They will accrue company seniority up
to a maximum of thirty (30) days while on furlough.

         7. Pilots on furlough are required to file their proper mailing address
and telephone number(s) with Human Resources at the time of the layoff and will
notify Human Resources of any changes to this information within ten (10)
calendar days.

         8. Furloughed pilots shall be notified of their recall by telephone or
certified mail to the most recent contact information provided as per Section 7
above. The date of recall notification shall be the date the Employer contacts
the furloughed pilot by telephone or the pilot acknowledges receipt of the
certified letter. Written notice to the pilot's last address of record shall be
conclusive evidence of notice to that furloughed pilot.

            A.    Each pilot accepting recall shall answer his recall notice no
                  later than five (5) calendar days after the Employer contacts
                  the pilot or the date the pilot signs for the certified
                  letter, whichever is earlier. Pilots who fail to respond to a
                  recall notice within the time limits set forth above, pilots
                  who refuse recall, or pilots who reject a recall notice shall
                  forfeit all recall rights and have their name stricken from
                  the seniority list.

            B.    A furloughed pilot who is recalled must report to work no
                  later than fourteen (14) calendar days after the date of
                  recall notification to report to duty. Nothing shall prevent
                  the Employer from beginning recurrent or requalification
                  training for recalled pilots prior to the fourteen (14) day
                  period if a sufficient number of pilots agree to return from
                  recall early.

         9. Seniority and recall rights shall terminate if a laid off pilot is
not recalled within thirty-six (36) months from the commencement of his lay off.




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                       ARTICLE 8. CATEGORIES OF AIRCRAFT


         1. Company aircraft shall be divided into three (3) categories
consistent with FAA definitions:

            A.    Small Aircraft: A single engine or multi-engine aircraft,
                  type-certificated to carry nine (9) passengers or less, and
                  with a maximum certified gross weight of 7000 pounds or less.

            B.    Medium Aircraft: An aircraft type-certificated to carry more
                  than nine (9), but less than twenty (20) passengers, and with
                  a maximum certified gross weight of more than 7000 pounds, but
                  less than 12,500 pounds.

            C.    Large Aircraft: An aircraft type-certificated to carry more
                  than nine (9) passengers, and with a maximum certified gross
                  weight of 12,500 pounds or greater.






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<PAGE>   12

                        ARTICLE 9. JOB POSTING & BIDDING

         1. In the event there is a non-temporary job opening, a Job Posting
will be issued, normally within seven (7) days. The Job Posting will normally be
posted for a minimum of fourteen (14) days and will include any terms of the job
opening such as pay, work schedule, experience and qualification requirements,
location(s), application and other pertinent job requirements information. The
selection will be made within seven (7) days after the closing of the job
posting, subject to customer acceptance of the pilot(s) and contract award.

         2. A Job Opening will exist when the employer determines that a need
exists for an aircraft transition, upgrade or specialized training, or that a
vacancy exists on a non-temporary customer contract. Transitions and specialized
training required for replacement aircraft or ad hoc specials will be posted in
accordance with this article, and will include any conditions such as base,
regional or area requirements, pool assignment, workover expectations, and
reassignment obligations and limits thereto (normally not to exceed twelve (12)
months).

         3. A pilot applicant shall be considered qualified if he has been
previously trained in aircraft type and has the specialized training; and is
current in duty position and meets customer and employer minimum experience
requirements. For transition and upgrade, qualified means that the pilot holds
appropriate FAA certification and duty position.

         4. A job which is contracted for one hundred eighty (180) days or less
is considered temporary. Temporary jobs expected to last more than sixty (60)
days will be posted except as provided for in Section 11 (temporary
reassignments) of this Article. A temporary job filled by posting will not be
re-posted in the event it becomes non-temporary, and the pilot awarded the job
through the temporary posting will remain on that job unless he opts to be
reassigned to the pilot pool, or he successfully bids on another job.

         5. A non-temporary job vacancy is created when:

            A.    A new customer contract is obtained, unless contract
                  requirements dictate that specific pilots fill the job, or

            B.    A pilot on a non-temporary job accepts another position, or

            C.    A pilot is removed from a job.

         6. A vacancy does not exist if:

            A.    A customer changes aircraft type, and requests that the
                  assigned pilot(s) remain on the job, or

            B.    The pilot on a non-temporary job is either on an extended
                  leave (i.e- sick leave, occupational injury leave or personal
                  leave) for ninety (90) days or less; or the pilot is on a
                  special assignment or temporary assignment for one hundred
                  eighty (180) days or less, or

            C.    The customer owns or dry leases the aircraft and retains the
                  right to select pilots for these aircraft. If the customer
                  requests that the employer select the pilot(s), then the job
                  will be posted in accordance with this section.

         7. Nothing in this Article prevents the Employer from hiring pilots
into the pilot pool.



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<PAGE>   13

         8. Downgrades from a medium or heavy ship assignment require the
approval of the Chief Pilot or Director of Operations.

         9. All job openings will be posted and awarded by the following method:

            A.    A job posting is issued and posted at all domestic company
                  locations.

            B.    The Employer will use the following criteria to determine if a
                  pilot meets the requirements to be considered for a job
                  opening:

                  1)    The customer must accept the pilot applicant, and

                  2)    The Employer reserves the right to require a minimum of
                        six (6) months in a previously awarded job; or twelve
                        (12) months in a previously awarded job involving an
                        upgrade or transition with a pay increase; or
                        twenty-four (24) months in a previously awarded job
                        involving a company paid relocation. Except for the six
                        month requirement and a company paid relocation, nothing
                        in this language prevents a pilot from an upgrade or
                        promotion opportunity.

            C.    The job opening is awarded to the qualified pilot with the
                  greatest bidding seniority.

            D.    If no qualified applicant submits a bid, the employer shall
                  award the job using the following criteria:

                  1)    In EMS:

                        a)    Select and qualify the senior applicant who meets
                              customer requirements.

                        b)    Select and qualify the senior furloughed pilot who
                              meets customer requirements.

                        c)    Hire from outside the company as necessary to fill
                              job opening.

                  2)    In all other business units:

                        a)    Transition the senior applicant who is otherwise
                              qualified except as to aircraft type if the
                              transition or specialized training does not
                              involve a pay increase.

                        b)    Select the least senior qualified pilot from the
                              pilot pool.

                        c)    Select and qualify the senior applicant who meets
                              customer requirements (such as aircraft transition
                              with a pay increase or upgrade).

                        d)    Select and qualify the least senior pilot from the
                              pilot pool who meets customer requirements.

                        e)    Select the least senior qualified pilot.

                        f)    Select and qualify the least senior pilot who
                              meets customer requirements.

                        g)    Select and qualify the senior furloughed pilot who
                              meets customer requirements.

                        h)    Hire from outside the company as necessary to fill
                              job opening.

         10. Before removing a pilot from a previous bid and assigned job, the
Employer will first attempt to get the customer to modify job requirements to
allow a pool pilot to fill the job until such time as an applicant can be
trained or otherwise qualified to fill the job.



                                       11
<PAGE>   14

         11. The Director of Operations may temporarily assign a qualified pool
pilot to fill an immediate or new contract job opening until a job posting and
qualifications can be accomplished. In the event a qualified pool pilot is not
available, the Director of Operations may assign another qualified pilot. This
assignment will normally not exceed ninety (90) days, but may be extended an
additional ninety (90) days for extreme and unusual operational necessity. Upon
completion of the assignment, the pilot may return to his regularly assigned job
if that job still exists. His regularly assigned job while he is on reassignment
will be filled on a temporary basis. While on such assignment, the pilot will be
paid per diem at the rate specified for pool pilots, so long as he is assigned
to a job at a base other than his regularly assigned base.

         12. Except as otherwise provided in this Article, pilots shall not be
removed from their regularly assigned jobs to cover vacant jobs for more than
three (3) consecutive workdays, not to exceed three (3) workdays per hitch and a
total of nine (9) workdays per calendar quarter.

         13. A pool pilot may submit a request for a base assignment, and
Scheduling will make a good faith effort to honor such request on a seniority
basis.

         14. In any case in which a pilot is interviewed by a customer for a
position, the Employer will provide the customer with the training records,
medical certificate and any commendations and/or disciplinary actions in the
pilot's personnel or operations file. No other records will be provided unless
requested in writing by the customer.




                                       12
<PAGE>   15

                        ARTICLE 10. SCHEDULES OF SERVICE

         1. Pilots will work a schedule that complies with applicable Federal
Air Regulations (FARs) and will essentially be one of the following types of
work schedules:

            A.    An earned day off for each day worked (e.g.- 6/6, 7/7, 14/14,
                  4/3/3/4, 5/2/5/9);

            B.    An earned day off for each two days worked (e.g.- 8/4, 10/5,
                  14/7);

            C.    Two days off for each 5 days worked (8 1/2 hour duty day where
                  the pilot is required to remain at the base);

            D.    Two days off for each 5 days worked (14 hour duty day where
                  the pilot is not required to remain at the base when there is
                  no flight requirement); and

            E.    Continuous duty (e.g.- fire fighting, and other temporary
                  assignments usually not exceeding ninety (90) days). The
                  Employer will attempt to provide the pilot on continuous duty
                  two (2) days rest for each fourteen (14) duty days.

            The provisions of this Article are intended to define a pilot's pay
in a biweekly payperiod and should not be construed as a guarantee of hours of
work or hours paid in a payperiod or as a limitation of the Employer's right to
schedule work or change the workday, the workweek, or the work schedules as
required by operations. However, the Employer agrees to confer with the Union
for any work schedule which deviates from those listed above, including the
appropriateness of any schedule bonus.

         2. The standard work schedule for Oil & Gas operations is the 7/7
schedule (i.e.- 7 days on and 7 days off). Any job assignment deviating from the
7/7 schedule, including those other work schedules listed above, shall be filled
according to Article 9. Job Posting & Bidding Article.

         3. The Employer will make assignments of pilots in compliance with FAR
required flight duty time limitations and rest periods.

         4. A pilot's work days shall not be changed without at least five (5)
calendar days notice unless caused by extreme or unusual operational changes or
upon mutual agreement between the pilot and the Employer.

         5. A pilot may leave his duty location, with his manager's approval, if
it is determined that no flying or other job requirements are foreseeable for
the remainder of the duty day.






                                       13
<PAGE>   16

                          ARTICLE 11. LEAVES OF ABSENCE


         1. A Leave of Absence (LOA) is intended to account for a reasonable
period of time that a pilot may be required to be absent from the job for
reasons other than VSTO, STO, or paid bereavement leave. A LOA may fall into one
of the following categories:

            A.    Informal LOA (a reasonable time not to exceed 30 days) without
                  pay may be granted to a pilot for urgent personal matters.
                  Some examples include attending special schools for personal
                  benefit, a need to handle family affairs associated with the
                  death or serious illness of a close family member, or other
                  special reasons. Except as approved by the Director of Human
                  Resources, a pilot may be granted no more than one (1)
                  Informal LOA in a 2-year period.

            B.    Formal LOA (a reasonable time up to one (1) year, or in cases
                  of non-occupational injury or illness which may be extended an
                  additional year if the Employer and the physician agree that
                  the pilot is likely to return to active duty during the
                  extension) without pay may be granted to a pilot to extend the
                  time they are gone from work for recuperation from an injury
                  or illness, or to allow a pilot with insufficient paid time
                  off to fulfill the 90 day waiting period for the Long Term
                  Disability Plan. A pilot on a Formal LOA may be required by
                  the Employer to provide periodic proof that he remains
                  disabled from work. Except as approved by the Director of
                  Human Resources, a pilot may be granted no more than one
                  Formal LOA in a 2-year period.

            C.    Military LOA- Military leaves of absence and reemployment
                  rights upon return from such leave shall be granted in
                  accordance with applicable laws. All orders for military duty,
                  including National Guard and Reserve duty, shall be provided
                  in writing to the Director of Operations, within four (4)
                  calendar days of receiving the orders. A pilot on a military
                  leave shall retain and accrue company and bidding seniority.

            D.    Family & Medical LOA (leave granted under the Family and
                  Medical Leave Act) will be granted to eligible pilots as
                  required by law. The Employer's separate policy on leaves
                  associated with the Family and Medical Leave Act will apply in
                  these type leaves of absence. A pilot on FMLA will continue to
                  accrue all seniority rights. In a case of a serious
                  non-occupational health condition of a pilot who does not
                  return to work within the twelve (12) week period provided for
                  under the FMLA, he will be placed on a Formal Leave of
                  Absence.

         2. A pilot who wishes to apply for a leave of absence must submit his
request in writing to his supervisor. This written request must include the
expected duration of the leave, the purpose of the leave and where the pilot may
be contacted during the leave. It is the pilot's responsibility to keep Human
Resources informed of any changes in his contact information for the duration of
the approved leave.

         3. All requests for leaves of absence must be submitted in writing and
must be approved by the Department Manager and the Director of Human Resources.
Except as approved by the Director of Human Resources, a pilot will not be
granted a leave of absence (except a Military LOA or Workers Compensation LOA)
without first using all VSTO or in the case of a Formal leave of absence for
illness or injury without first using all STO.



                                       14
<PAGE>   17

         4. Prior to returning to duty from medical leave, a pilot may be
required to present a physician's statement to the Employer verifying that he is
medically fit to perform all pilot duties.

         5. A pilot on any non-medical leave of absence may continue certain
benefits, if any, such as Medical, Dental, Life Insurance, and Long Term
Disability/Loss of License for a maximum of one (1) month at premium rates
comparable to what other represented pilots are paying. A pilot on any
non-occupational leave of absence may continue certain benefits, if any, for a
maximum of six (6) months at premium rates comparable to what other represented
pilots are paying.

         6. Continued pilot contributions and Employer matching in the 401(k)
plan, if any, are based exclusively on receipt of wages in any payperiod.

         7. A pilot will continue to accrue VSTO and all seniority rights for a
maximum of 90 days for any leave of absence. However, a pilot on a Military
Leave of Absence, Worker's Compensation Leave of Absence and non-occupational
serious illness or injury will continue to accrue company and bidding seniority
for the duration of the leave.

         8. Approval of any leave of absence for a probationary employee rests
exclusively with the Employer. If a pilot is granted a leave of absence during
his probationary period, his probationary period shall be extended accordingly.

         9. In the event of a reduction-in-force, a pilot on a leave of absence
who would otherwise be laid off will have his leave of absence cancelled. The
pilot will be notified that his rights under this agreement have been changed to
those of a furloughed pilot.

         10. A pilot returning from a leave of absence will be returned to his
duty position if it still exists or any other vacant position where his
seniority and qualifications permit. Any pilot returning from a leave of absence
who requires training prior to returning to flying will be scheduled for
required training within seven (7) duty days or the next scheduled class from
the time the pilot notifies the Employer he is returning from such leave and has
met all requirements to return to flight duty. Pay shall resume when the pilot
commences training.

         11. All leaves of absence shall specify the date on which the pilot
will return to duty unless mutually agreed otherwise or by operation of law.

         12. All leaves of absence shall be without pay unless otherwise
specified in this agreement.

         13. Failure of any pilot to return to active status at the end of any
leave of absence shall be deemed a voluntary resignation and his name will be
removed from the seniority list.

         14. Any pilot on a leave of absence who enters the services of another
employer or who enters into a business of his own without first obtaining
written permission from the Employer, will be terminated and will forfeit his
seniority rights.



                                       15
<PAGE>   18

                    ARTICLE 12. PAID DAYS OFF AND BANKED DAYS

                         PAID TIME OFF AND LEAVE ACCRUAL

         1. There will be two types of leave accrual banks: a Vacation and
Scheduled Time Off Bank (VSTO) and a Sick Time Off (STO) Bank. These two banks
are used to give a pilot more flexibility and control for his paid time off.

                         VACATION AND SCHEDULED TIME OFF

                                  VSTO Accrual

         1. The number of VSTO days earned each year is dependent on a pilot's
years of active service with the Employer.

<Table>
<Caption>
                Completed Years of Active
                   Service As A Pilot                   Accrual Units
                -------------------------               -------------

<S>                                                     <C>
                        1-5 Years                            10
                         6 Years                             11
                         7 Years                             12
                         8 Years                             13
                         9 Years                             14
                       10-11 Years                           15
                       12-13 Years                           16
                       14-15 Years                           17
                       16-17 Years                           18
                       18-19 Years                           19
                    20 Years and More                        20
</Table>

         To compute work days vacation due:

         -   5&2, 8&4, 10&5 schedules: Multiply accrued units by 1.0

         -   All one for one schedules: Multiply accrued units by 0.7 & round to
             nearest day

         2. In order to accrue VSTO days, a pilot must be an active pilot on the
payroll for at least fifteen (15) days in a month.

         3. A new hire pilot will accrue VSTO in a month only if he is on the
payroll prior to the fifteenth (15th) of the month.

         4. A pilot does not earn and is not eligible to take VSTO days until he
completes one (1) year of active duty with the Employer.

                           Scheduling and Bidding VSTO

         1. VSTO is to be used for scheduled time off. A pilot may request up to
seven (7) day-at-a-time (DAT) VSTOs per year. Approval of the individual DAT
VSTO days is based on operational needs. The request must be submitted to the
Scheduling Department prior to the end of a hitch for use in the next hitch. DAT
will be granted on a first-come, first-serve basis.

         2. A pilot may bid all or part of his VSTO accrual as full weeks of
vacation. In cases where more than one pilot desires full week VSTO days on the
same work hitch and the Employer must limit such request due to



                                       16
<PAGE>   19

operational needs, the full week VSTO days will be awarded to the pilot(s) with
the greatest company seniority. The Employer may limit the number of pilots
permitted time off at any one time due to operational needs.

         3. Full week requests must be made at least sixty (60) days in advance.
Approvals will be given to pilots no less than thirty (30) days prior to the
start date of the pilot's requested vacation.

         4. A pilot may request the Employer purchase up to eighty (80) hours
accrued VSTO once each twelve months. In this case the pilot must submit his
request in writing to the Director of Human Resources. A pilot may accrue a
maximum of three hundred forty-four (344) hours VSTO at his anniversary date.

         5. A pilot may elect to use his VSTO bank to supplement any Workers
Compensation payments due an injury/illness incurred on the job with the
Employer as described in Article 13, On-the-job Injuries/Worker's Compensation.

         6. All VSTO days are paid at a pilot's applicable daily rate, except as
provided for by Employer policy.

                 VSTO Cancellation due to Operational Necessity

         1. In the event VSTO days are canceled due to operational necessity,
the Employer shall notify the affected pilot. Cancellations shall first be
offered to volunteers in reverse seniority order. If an insufficient number of
pilots voluntarily accept cancellation, remaining cancellations shall be
involuntarily cancelled and assigned in inverse seniority order. If a vacation
is involuntarily cancelled by the Employer or the pilot voluntarily cancels his
vacation at Employer request, the pilot shall be paid one hundred and fifty
(150) percent of his base pay for that period of scheduled vacation that he
actually works.

         2. When a full week's VSTO is canceled, the pilot and the Employer
shall attempt to find a mutually agreeable substitute block during the current
year. In the event a mutual agreement is not reached, the pilot may elect to
receive compensation in lieu of vacation. In this case, the pilot will not be
limited to the maximum of eighty (80) hours Employer purchased VSTO as described
in Section 4 above.

         3. In the event the Employer cancels a pilot's full week VSTO for
operational needs and it was involuntary on the pilot's part, all non-refundable
vacation deposits which the pilot, with the assistance of the Employer, is
unable to recover shall be reimbursed to the pilot. In order to receive
reimbursement, the pilot shall provide the Employer with proof of the deposit.

                       Treatment of VSTO Upon Termination

         1. In the event a pilot voluntarily leaves the Employer (including
retirement or permanent disability), he will be paid for his accrued VSTO days
provided he has given the Employer two weeks notice of his departure.

                               SICK TIME OFF (STO)

         1. Sick Time Off (STO) Days are granted to a pilot to provide an
opportunity for him to recover from an illness or injury. A pilot may elect to
use his STO bank to supplement any Workers Compensation payments due to an
injury/illness incurred on the job with the Employer as described in Article 13,
On-the-job Injuries/Worker's Compensation.

         2. The number of STO days accrued each year is dependent on a pilot's
years of active service with the Employer according to the following schedule:

<Table>
<Caption>
                Completed Years of Active
                   Service As A Pilot                Accrual Units/year
                -------------------------            ------------------

<S>                                                  <C>
              6 months but less than 1 Year                   1
              1 Year but less than 2 Years                    1
              2 Years but less than 3 Years                   2
              3 Years but less than 4 Years                   3
                    4 Years and over                          4
</Table>


                                       17
<PAGE>   20

        To compute work days STO accrued:

         -   5&2, 8&4, 10& 5 schedules: Multiply accrued units by 5

         -   All one for one schedules: Multiply accrued units by 3.5

         3. A pilot may accrue a maximum of 560 hours STO, except that any pilot
who has greater than this maximum at the time this agreement is executed shall
be grandfathered with his accrued STO and will not accrue any additional STO
until such time as his total STO hours drops below the 560 hour maximum. STO
days will be accrued to a pilot only after he has completed six (6) months of
active duty with the Employer.

         4. All STO days are paid at a pilot's applicable daily rate, except as
provided for by Employer policy.

         5. Unscheduled absences are taken in the following order:

            A.    Unscheduled absences due to personal illness or injury off the
                  job will be taken from the STO Bank.

            B.    Once the STO Bank is exhausted, a pilot may use his remaining
                  unused VSTO days.

            C.    Unbid accrued VSTO days must be used for any additional
                  unscheduled absences.

         6. Use of VSTO and STO on Family Medical Leave shall be required
pursuant to Family Medical Leave Act policy of the Employer. Use of VSTO days
for other leaves of absence will be pursuant to the Employer's leave policies.

         7. A pilot who is out on STO days for seven (7) consecutive work days
will be required to provide a physician's statement at that time and on a
monthly basis until he is released by the physician to return to active duty.
The pilot is responsible to ensure the FAA has cleared the pilot to return to
active duty if such illness or injury requires this FAA clearance.

         8. Maternity leave and disabilities caused or contributed by pregnancy,
miscarriage, abortion, childbirth and recovery therefrom shall be treated as
time covered by STO.

         9. Pilots and the Union share in the responsibility for preventing
unnecessary absences and shall assist the Employer in its efforts to minimize
any abuse of excessive absenteeism.

            A.    A pilot who cannot perform his duties due to a
                  non-occupational injury or illness shall immediately report
                  such absence and the reason for it to his immediate
                  supervisor. A pilot shall personally contact his supervisor on
                  a daily basis during his scheduled work hitch unless
                  physically unable to do so and shall advise the supervisor of
                  his expected date of return and a telephone number where he
                  can be reached during his absence.

            B.    Upon reasonable suspicion of misuse of such leave, the
                  Employer reserves the right to require a physician's
                  certificate or an examination by a Employer-designated
                  physician. To the extent any Employer-requested examination is
                  not covered by insurance, it shall be paid for by the Employer
                  provided the pilot submits receipts for reimbursement in a
                  timely manner.




                                       18
<PAGE>   21

               ARTICLE 13. ON THE JOB INJURY/WORKERS' COMPENSATION


         1. A pilot is eligible for worker's compensation benefits with respect
to injuries or illnesses arising out of and in the course of employment with the
Employer, provided that the pilot injured on the job reports the injury
immediately to his supervisor. If the injury is not immediately apparent, the
pilot must notify his supervisor as soon as the injury becomes apparent.

         2. A pilot injured on the job will receive his worker's compensation
benefits in accordance with applicable law. The Employer will make whole any
lost wages for the pilot during the statutory waiting period to the extent that
such wages are not paid by the Worker's Compensation carrier or the state.

         3. The pilot shall inform his supervisor of the injury and immediately
complete the First Report of Injury and give to the supervisor (unless urgent
medical care is required for the pilot in which case this report shall be
completed as soon as practical). If the pilot refuses medical attention, he must
complete and sign the refusal of care form and give it to his supervisor.

         4. A post-accident drug and alcohol screen will be performed if the
injury is a direct result of the actions of the pilot or if required by Company
policy, DOT or FAA regulations.

         5. Pilots unable to report to work on their next scheduled workday due
to an On the Job Injury (OJI) will be placed on Worker's Compensation (WC) leave
of absence. VSTO and STO days will not be charged to a pilot who is injured on
the job. The pilot is eligible to use Long-Term Disability insurance, if any, at
the end of the waiting period. A Worker's Compensation leave and leave under the
FMLA shall run concurrently in cases of on-the-job injuries or illness, except
such leaves shall not prevent the pilot from obtaining an additional leave for
other reasons covered by the FMLA within the twelve (12) month period prescribed
by law.

         6. A Workers Compensation leave of absence of up to one (1) year will
be granted to a pilot who experiences an on-the-job injury/illness (OJI) and is
medically required to be absent from work. If the pilot is unable to return to
work following the one year leave, the Employer will consult with the pilot's
physician and Aeromedical Medical Examiner in a review of the pilot's medical
prognosis to determine if an extension of the leave is necessary, in which case
the leave may be extended not to exceed thirty-six (36) months from the date of
the injury.

         7. WC leave will have no effect on the pilot's seniority with the
Employer and the pilot will accrue VSTO while on WC leave for up to one year.
All insurance benefits, if any, shall continue to be available to the pilot on
the same basis as other active represented pilots for a maximum of twelve (12)
months of WC leave. If the pilot continues on Workers Compensation leave beyond
twelve (12) months, he may continue his insurance benefits at the same premium
rate as under COBRA.



                                       19
<PAGE>   22

         8. A pilot on WC leave will contact his Supervisor or Human Resources
weekly to update his progress and discuss returning to work.

         9. If the pilot is unable to return to active duty, either in a
restricted or unrestricted capacity, at the end of his Worker's Compensation
leave of absence, his employment will be terminated.

         10. The Employer may require an injured pilot to submit to a physical
examination at the Employer's expense.

                            TRANSITIONAL WORK POLICY

         1. At the Employer's discretion, a pilot on WC leave may be offered,
and he may accept, a transitional work assignment within the restrictions placed
on the pilot by the treating physician. Human Resources and the supervisor will
work with the physician to determine if the pilot's restrictions allow him to
perform the transitional work.

         2. If the pilot is unable to return to work in his regular job, but can
perform other duties beneficial to the organization, the supervisor working with
Human Resources may temporarily assign the pilot to a transitional work
assignment which falls into one of the following categories:

            A.    he temporarily fills a vacant position;

            B.    he performs work which will offset overtime or vacation.;

            C.    he performs work which reduces the need for contractors or
                  temporary pilots; or

            D.    he performs project work beneficial to the Employer.

         3. This arrangement will be reviewed by the Supervisor and Human
Resources with the treating physician at least twice a month to determine if the
pilot is able to return to full duty.

         4. If the pilots regular rate of base pay is within the pay range for
the temporary assignment, then the pilots base pay shall not be reduced,
otherwise the Supervisor working with Human Resources will determine an
appropriate pay rate.

         5. It is the sole discretion of the Employer to return an
injured/disabled pilot to work prior to their full medical release and to
determine duration of the accommodation.




                                       20
<PAGE>   23

                          ARTICLE 14. BEREAVEMENT LEAVE

         1. The provisions of this section are intended to provide pilots with
paid leave, if needed, in cases of death of a member of the pilot's immediate
family while the pilot is scheduled to work.

         2. Paid time may be granted to a pilot for a death to a member of the
pilot's immediate family while the pilot is scheduled to work. Immediate family
is defined as: Parent (or legal guardian), Sister, Brother, Spouse, Children,
Grandparents, Mother-in-Law, or Father-in-Law.

         3. The Employer will grant bereavement leave for the death of a pilot's
immediate family. This leave shall be granted for up to three (3) consecutive
days for each occurrence, provided however, that such three day period must
include the day of the funeral, or absent a funeral, a memorial service. Pilots
will be paid for each duty day missed during this three day period. A pilot must
receive Employer approval for any additional time off work for bereavement leave
and the pilot may use accrued VSTO to cover his pay for such additional time
off.

         4. The pilot shall provide, and the Employer will accept, any
reasonable proof of death and verification of the date of the funeral or
memorial service.






                                       21
<PAGE>   24

                              ARTICLE 15. JURY DUTY

         1. Jury Duty is considered an authorized absence with regular pay. Any
monies received by a pilot from the court for Jury Duty shall be signed over to
the Employer.

         2. A copy of the jury summons should be forwarded to the Human
Resources Department

         3. Jury Duty pay is not applicable when a pilot is on leave of absence,
VSTO/STO or layoff.

         4. In the event a pilot is released from Jury Duty on a duty day, he
shall be required to return to his base provided the court is located within
reasonable proximity to the base and he has at least six (6) hours remaining in
his duty day.

         5. If a pilot is called for Jury Duty twice within a twelve (12) month
period in jurisdiction where citizens are exempt on the second call within the
twelve (12) period, the Employer is not obliged to pay for Jury Duty.

         6. Pilots under subpoena for reasons other than those benefiting the
Employer or jury duty, will be charged VSTO. When VSTO is not available, the
time off will be without pay.






                                       22
<PAGE>   25

                   ARTICLE 16. FEES AND PHYSICAL EXAMINATIONS

         1. It shall be the responsibility of each pilot to maintain an
appropriate and current FAA medical certificate, and to provide a copy of this
certificate to the Employer by the 20th of the month in which it is due.

         2. It shall be the responsibility of each pilot to maintain the
appropriate FAA pilot certificate(s) required for his duty position. The pilot
shall provide the most current certificate(s) to the Employer, and immediately
report any changes that affect the validity of those certificates.

         3. It shall be the responsibility of each pilot to arrange his required
medical examination as required by the FAA by a qualified aeromedical examiner
of the pilot's choice. Such medical examinations are to be scheduled and
conducted on the pilot's off duty time. The pilot is responsible for all costs
associated with these medical examinations to the extent that these costs are
not covered by the wellness benefit under the Employer medical insurance, if
any.

         4. When the Employer believes that there are grounds to question a
pilot's physical or mental condition to remain on flight status, the Employer
may require that such pilot be examined by a FAA designated aeromedical examiner
(AME) selected by the Employer. The Employer shall pay for this medical
examination or tests required by the Employer pursuant to this Article. The
pilot agrees to sign a medical release to allow a copy of the results to be
given to the Employer and the pilot shall also be provided a copy of this
report. This report will state specifically if the pilot is unable to perform
his duties.

         5. A pilot who fails to pass an Employer's medical examination may have
a review of the case. Such review will be conducted by the Medical Certification
Branch of the FAA. The pilot may, at his expense, have a second medical
examination conducted and submitted along with the Employer's medical
examination to this branch of the FAA.






                                       23
<PAGE>   26

                              ARTICLE 17. TRAINING

         1. For the purposes of this agreement, the following terms apply to
pilot training and duty position assignment:

            A.    Initial New Hire Training. This training category is for newly
                  hired pilots who have not had previous experience with the
                  Employer or rehires who are not eligible for recurrent
                  training. It also applies to pilots employed by the Employer
                  who have not previously held a crewmember position.

            B.    Initial Equipment Training. This category of training is for
                  pilots who have been previously trained and qualified for a
                  duty position by the Employer (not new hires) and who are
                  being reassigned for any of the following reasons:

                        (1) For Part 135 operations, the crewmember is being
                        reassigned in one of the following circumstances:

                              a) Reassignment to a different duty position or a
                              different aircraft type and the crewmember has not
                              been previously trained and qualified by the
                              Employer for that duty position and aircraft type.

                              b) Reassignment to an aircraft of a category or
                              class for which the crewmember has not previously
                              qualified with the Employer.

            C.    Transition Training. This category of training is for a pilot
                  who has been previously trained and qualified for a specific
                  duty position by the Employer and who is being assigned to the
                  same duty position on a different aircraft type.

            D.    Upgrade or Promotion Training. This category of training is
                  for a pilot who has been previously trained and qualified as
                  First Officer, IFR (SIC or second in command) by the Employer
                  and is being assigned as a Captain, IFR (PIC or pilot in
                  command) to the same aircraft type for which the pilot was
                  previously trained and qualified.

            E.    Recurrent Training. This category of training is for a pilot
                  who has been trained and qualified by the Employer, who will
                  continue to serve in the same duty position and aircraft type,
                  and who must receive recurring training and/or checking within
                  an appropriate eligibility period to maintain currency.

            F.    Requalification Training. This category of training is for a
                  pilot who has been trained and qualified by the Employer, but
                  is not current to serve in a particular duty position and/or
                  aircraft due to not having received recurrent training and/or
                  a required flight or competency check within the appropriate
                  eligibility period. Requalification training is also
                  applicable if a crewmember fails a required test or check.

            G.    Specialized Training. This is training conducted for pilots
                  who are assigned to a job they have not previously flown for
                  the Employer or is supplemental training. Some examples, but
                  not a complete list, of specialized training are; fire
                  fighting, long line, mountain, EMS, Offshore, and rescue
                  hoisting; and some examples of supplemental training are water
                  survival and customer required training.

            H.    Duty Position: The functional or operating position of a
                  crewmember. For purposes of this agreement, duty positions are
                  Captain, IFR; First Officer, IFR; and Captain, VFR.

         2. When it becomes necessary to transition or upgrade (promote) pilots,
bidding seniority shall be given priority to the extent possible subject to job
and customer requirements.



                                       24
<PAGE>   27

         3. Recurrent Training

            A.    Recurrent training will be conducted in accordance with the
                  Employer's FAA approved training program. Pay for recurrent
                  training will be in accordance with Article 21, Section 9.

            B.    Each month the Employer will publish a list of those who are
                  scheduled for recurrent training; however, it is the pilot's
                  responsibility to know when his recurrent training and/or
                  checkrides are due, and to notify the director of training if
                  he has not been scheduled at the appropriate time. In the
                  event a pilot is unable to attend training on the day(s)
                  scheduled, he will notify the director of training or his
                  representatives as far in advance as possible. If a mutually
                  acceptable date cannot be agreed upon by the pilot and the
                  Director of Training, the pilot shall be obligated to attend
                  on the originally scheduled date(s).

         4. Transition, Upgrade, and Initial Equipment Training, and Specialized
Training

            A.    Transition, Upgrade, and Initial Equipment training will be
                  conducted in accordance with PHI's FAA approved training
                  program. Pay for Transition, Upgrade, and Initial Equipment
                  training will be in accordance with Article 21, Section 9.

            B.    A pilot who fails training during an upgrade, transition,
                  initial equipment or specialized course will not be eligible
                  to reapply (in writing) for that training for six (6) months
                  unless approved by the Chief Pilot, the Director of Operations
                  or their representative. A second failure of an upgrade,
                  transition, initial equipment training or specialized course
                  will make the pilot ineligible for that course for at least
                  twelve (12) months, and only then with the approval of the
                  Chief Pilot, the Director of Operations or their
                  representative.

         5. Initial New Hire Training

            A.    Initial New Hire training will be conducted in accordance with
                  PHI's FAA approved training program. Pay for Initial New Hire
                  will be in accordance with Article 21, Section 9.

         6. Training, Checking, or Testing Failures

            A.    Training (Initial New Hire, Recurrent, Initial Equipment,
                  Transition, Upgrade, or specialized training). A pilot who is
                  unable to successfully complete a required portion of training
                  will have that training discontinued. The Director of Training
                  will consult with the pilot in an effort to determine the
                  cause of the of the pilot's inability to complete the
                  training. The pilot may request a change of instructor, and
                  the Employer will grant this request if another instructor is
                  available. If the pilot is still unable to successfully
                  complete the training, the Director of Training will



                                       25
<PAGE>   28

                  determine if training is to be continued or stopped. If the
                  Director of Training stops the training, the pilot will be
                  returned to his previous job. If that job no longer exists,
                  the pilot will be assigned to the pilot pool. In the case of
                  Initial New Hire training, the Chief Pilot or the Director of
                  Operations will review the pilot's training records and make a
                  determination as to the appropriate course of action.

            B.    Checking or Testing Failures. A pilot who fails a required
                  test or check will immediately be removed from flight duty.
                  The pilot will be offered additional training if necessary,
                  and a recheck, if he successfully completes the additional
                  training, providing that the pilot has had no previous
                  failures within the past three (3) years. The pilot may
                  request a change of instructor or check airman, and the
                  Employer will grant this request if another check airman is
                  available. If the pilot has had a previous failure within the
                  past three (3) years, the Chief Pilot or the Director of
                  Operations, will consult with the pilot and determine an
                  appropriate course of action. If further training, testing or
                  checking is approved by the Chief Pilot or the Director of
                  Operations, the pilot may request a check airman change. The
                  Employer will grant this request if another check airman is
                  available. The pilot may request a recheck by an FAA
                  inspector, and the Employer will make an effort to accommodate
                  this recheck request, but does not control the availability of
                  an FAA inspector. If the pilot fails the recheck, the Chief
                  Pilot or Director of Operations will determine an appropriate
                  course of action.

            C.    Pay Procedures for Checking or Testing Failures. The Employer
                  will make a reasonable effort to retest or recheck within
                  seven (7) days of the date of the initial test or check
                  failure. If the pilot fails a retest or recheck, he will be
                  returned to his previous job, if qualified. If that job is not
                  available, the pilot will be reassigned to the pilot pool, if
                  qualified. The Employer will provide housing and per diem for
                  time spent in training, testing or retesting, and;

                  (1)   A pilot who fails any required test or check and has not
                        failed a test or check within the past thirty-six (36)
                        months will be ineligible for any additional pay during
                        his earned time off and will be removed from flight
                        duty. The pilot will be eligible for up to seven (7)
                        scheduled workdays pay following the failure provided he
                        has not declined to retest or recheck during his earned
                        time off. If the additional time beyond the seven (7)
                        scheduled missed workdays is due to the pilot's
                        unavailability or the pilot declines the opportunity to
                        retest or recheck during his earned time off, then all
                        time for missed scheduled workdays will be either leave
                        without pay or VSTO, until the pilot completes the
                        retest or recheck.

                  (2)   A pilot who fails any required test or check and has
                        failed a test or check within the preceeding thirty-six
                        (36) months will be ineligible for any additional pay
                        during his earned time off and will be removed from
                        flight duty and will be placed on leave without pay or
                        VSTO, until he successfully passes the retest or
                        recheck.



                                       26
<PAGE>   29

         7. Training Committee

            A.    The parties agree to create to a joint training committee,
                  which shall consist of two (2) representatives designated by
                  the Employer, and two pilots designated by the Union. The role
                  of the Training Committee shall be to jointly review pilot
                  recommendations for changes and improvements in the pilot
                  training programs. Pilot representatives shall function in an
                  advisory capacity. The training committee will meet
                  periodically as necessary, but no less than once per year.








                                       27
<PAGE>   30

                 ARTICLE 18. FACILITIES, EQUIPMENT AND UNIFORMS

                                   FACILITIES

         1. Except for regular assignments in Fixed Wing, EMS, firefighting and
other unique operations in remote areas, the Employer shall provide pilots with
clean and comfortable rooms near its operating bases. These may be either
apartment units, motels, or mobile homes. The rooms will be provided under the
following circumstances:

            A.    When a pilot does not work within thirty (30) miles of his
                  home regardless of whether he is on regular work schedule or
                  workover; or

            B.    When travel back to his home would prevent the pilot from
                  receiving minimum rest in accordance with FARs.

         2. All mobile homes provided by the Employer will be limited to a
maximum of five (5) bedrooms. If any pilot(s) in a mobile home objects to such
sleeping accommodations for valid reasons, the Employer will endeavor to place
the pilot(s) in alternate accommodations. Quality furnishings will be provided
in each mobile home, including air conditioning, furniture, two refrigerators
(in units with five (5) bedrooms), television with selectable cable or
equivalent, stove and microwave oven, and cooking and eating utensils. If not
provided in the mobile homes, washers and dryers will be provided near the
operating bases.

         3. For Employer-provided accommodations, the Employer will provide maid
service weekly to clean the facility and replace towels and bed linens. Adequate
numbers of clean towels and linens will be provided to pilots at least once per
week. When a pilot vacates a room, it is his responsibility to remove his bed
linens and place his towels and linens in the designated location inside the
residence.

         4. The Employer will arrange transportation to and from
Employer-provided off-base accommodations for pilots who are assigned to a
different work location than the location the pilot initially reported to,
unless the pilot used his personal vehicle to move to that new work location.
The Employer will endeavor to arrange transportation to such pilots at meal
times as necessary.

         5. Pilots on temporary assignment or workover (other than at their
regularly assigned base) in EMS shall be provided with clean and comfortable
housing near the assigned work location and the Employer will arrange
transportation to and from the accommodations when required. The Employer will
provide or reimburse Fixed Wing pilots for accommodations when the pilot is
required by the Employer to remain overnight (RON). If a pilot is assigned to a
fire fighting assignment or other unique remote area assignments, the Employer
will provide clean and comfortable housing where available.

         6. All Employer-provided accommodations shall be single occupancy, if
available.



                                       28
<PAGE>   31

         7. The Union may appoint a Crew Accommodations Committee to work
jointly with the Employer concerning pilot complaints about pilot
accommodations. The Committee may make recommendations to the Employer to
improve crew accommodations and base living conditions.

         8. The Employer will make a reasonable effort to insure that
customer-provided accommodations are suitable, clean and comfortable. If a pilot
finds the customer-provided accommodations substandard, he shall immediately
report his specific complaint to the Employer, and the Employer will promptly
investigate and seek to resolve the complaint. In any case where the
customer-provided accommodations are substandard, with Employer approval, the
pilot may be permitted to move to another location with acceptable
accommodations.

         9. It will be the responsibility of each pilot housed in
Employer-provided accommodations to maintain the cleanliness of his area, treat
all furnishings and appliances with care, and report any items in need of repair
to the appropriate supervisor or Area Manager. Smoking is not permitted in
Employer-provided accommodations.

         10. Employer-provided accommodations are to be used by PHI employees
only.

                                    EQUIPMENT

         1. The Employer shall make available to its pilots all equipment
required to perform their duties.

         2. Pilots are responsible for all equipment assigned to them, and if
they lose equipment, or damage equipment through negligence, the pilot will be
required to reimburse the Employer for the cost of the replacement.
Employer-provided equipment that becomes inoperative as a result of normal wear
and tear will be repaired or replaced by the Employer.

         3. The Employer will provide each pilot with an individually assigned
headset. If the pilot loses or damages the headset, the pilot will be required
to purchase a replacement. Headsets that become inoperative as a result of
normal wear and tear will be repaired or replaced by the Employer.

                                 PILOT UNIFORMS

         1. Pilot uniforms are provided by the Employer and are required to be
worn while on duty in the work environment. The Oil & Gas pilot uniform consists
of tan shirt with shoulder boards and brown trousers. The IHTI pilot uniform
consists of blue shirt with shoulder boards and blue trousers. The Aeromedical
pilot uniform is appropriate to the customer assignment. Uniform colors are at
the sole discretion of the Employer.

         2. Pilots will be issued fourteen (14) garments for seven (7) complete
uniforms when hired. Short or long sleeve shirts may be ordered in any
combination totaling seven (7), but may not be substituted for ordering extra
pants. In addition, a pilot may be issued up to four (4) caps per year.



                                       29
<PAGE>   32

         3. Pilots' names will be displayed on the uniform shirts. Space
limitations dictate a maximum of twenty-seven (27) total letters. The maximum
number of letters for the first name is eleven (11). If the pilot's first name
exceeds eleven (11) letters, the initial letter of the first name will precede
the last name. A pilot may choose not to display his last name. Nicknames which
are derivatives of given first, middle, or last names can be used on the uniform
shirt.

         4. The replacement of pilot uniforms for reasonable wear and tear will
be based on Employer approval.

         5. Substitution or modification other than tailoring for proper fit of
uniform parts is not permitted. Shirts will be worn tucked in. Belts will be
worn. The headgear issued by the Employer or that of an appropriate customer or
manufacturer may be worn.

         6. Pilots shall maintain their uniforms in a clean and professional
condition.

         7. Pilots shall wear brown or black professional footwear.






                                       30
<PAGE>   33

                            ARTICLE 19. SEVERANCE PAY

         1. A pilot who is laid off and goes on furlough with the Employer shall
receive severance pay according to the schedule in Section 2 below except if one
or more of the following conditions exist he shall receive no severance pay:

            A.    He refuses to accept a job or assignment within his category
                  as "pilot" with the Employer;

            B.    The lay off is caused by circumstances beyond the control of
                  the Employer; or

            C.    He is dismissed for cause, resigns or retires.

         2. Severance pay will be paid within seven (7) days of the pilot's
furlough according to the following schedule:

<Table>
<Caption>
       Years Company Service              Calendar Weeks Severance Pay
       ---------------------              ----------------------------
<S>                                      <C>
       1 year but less than 4 years                    2
       4 years but less than 8 years                   4
       8 years but less than 12 years                  6
       12 years but less than 16 years                 8
       16 years or more                               10
</Table>

         3. The Employer may offer voluntary leaves of absence or voluntary
furloughs to offset scheduled furloughs. Any volunteer selected by the Employer
for furlough shall be covered by the provisions of this Article.

         4. Medical, dental and life insurance, if any, shall continue until the
end of the month the pilot terminates provided such pilot pays appropriate
premiums. The pilot will be eligible for COBRA coverage at that time.




                                       31
<PAGE>   34

                           ARTICLE 20. MOVING EXPENSE

         1. It is the policy of PHI to assist and ease the financial and other
burdens associated with the reasonable expenses of relocation. This policy will
provide uniform and equitable treatment regardless of work location within the
United States.

         2. Pilots who relocate at the request of the Employer who are required
to live within one (1) hour of the job location shall be reimbursed under this
policy, however, a move will only be paid if it results in the Employer not
having to provide the pilot with Employer-provided accommodations at his new
work location. In the event the Employer reimburses a pilot for relocation to a
new job assignment and that job contract later ends, the Employer will reimburse
the pilot's relocation to his previous domicile or his next assignment.

         3. The Human Resources Department will assist relocating pilots to
facilitate their move.

         4. Eligible pilots will be reimbursed for reasonable expenses of moving
as follows:

            A.    Packing, insuring, shipping, unpacking and placement of
                  household personal effects and reasonable items of furniture,
                  furnishings, clothing, appliances, tools and equipment from
                  the principal place of residence to the new home up to a
                  maximum of 12,000 pounds. Special handling items as defined by
                  the moving company will not be eligible for reimbursement
                  (e.g.- transportation of pets/animals, boats, automobiles,
                  motorcycles and heavy shop equipment).

            B.    Automobile(s) will not be transported as part of the household
                  goods move. PHI will pay the cost of driving one vehicle per
                  family by the most direct AAA highway mileage route at the
                  current mileage rate established by the IRS. No expenses will
                  be paid for a second vehicle.

            C.    Transportation of pilot and family at the time of the move:

                  o     Mileage at current IRS rate by the most direct AAA
                        highway mileage route from home to home

                  o     Pilots will be allowed the following enroute expenses
                        when properly substantiated by receipts during the
                        period of enroute travel:

                        I.    For pilot only - $30.00/day

                        II.   For pilot and Spouse - $60.00/day

                        III.  For each dependent child - $15.00/day

                  o     The period of enroute travel shall continue after
                        arrival until the day the household effects arrive or
                        until the end of the fifth (5th) day, whichever comes
                        first.



                                       32
<PAGE>   35

            D.    For the purpose of determining necessary travel time, the
                  Employer will allow one (1) travel day for each five hundred
                  (500) miles or fraction thereof, to a maximum of five (5)
                  travel days when driving a vehicle. The pilot is expected to
                  move during his days off and be prepared to work on his
                  assigned schedule. The most direct AAA mileage between the two
                  (2) cities will determine travel time.

         5. Pilots eligible for Employer paid moving expenses who elect to move
themselves shall be reimbursed for actual moving expenses such as truck or
trailer rental, gas, oil, drop-off and other Employer-approved expenses. Pilots
must notify the Employer in advance of a move, receive prior Employer approval,
and follow the specified procedures per Company policy in order to be
reimbursed. Actual expenses reimbursed cannot exceed the total estimated cost of
a Company-coordinated move.

         6. Federal Tax Regulations require an Employer to include moving
reimbursements as gross income. The Internal Revenue Code allows reasonable
moving expense deductions provided pilots use the itemized deduction procedure
when filing their income tax returns.

         7. Pilots who voluntarily leave the Employer within twenty-four months
of a paid move will be required to reimburse the Employer for all moving
expenses provided herein.






                                       33
<PAGE>   36

                              ARTICLE 21. BASE PAY

         1. A pilot will be placed in his appropriate pay scale based on the
type of aircraft flown and his years with the Employer as a pilot, except where
a pilot has been hired and given credit for appropriate previous experience.

  CAPTAIN, VFR (PIC)/FIRST OFFICER, IFR (SIC)/FIRST OFFICER, FIXED WING (SIC)

<Table>
<Caption>
                                1/1/2001         JUNE 2001         JUNE 2002         JUNE 2003
                   STEP        ANNUAL PAY       ANNUAL PAY        ANNUAL PAY        ANNUAL PAY
                   ----        ----------       ----------        ----------        ----------
<S>                <C>         <C>              <C>               <C>               <C>
                    1           $37,000           $40,700           $42,735           $44,872
                    2           $38,000           $41,800           $43,890           $46,085
                    3           $39,000           $42,900           $45,045           $47,297
                    4           $40,000           $44,000           $46,200           $48,510
                    5           $41,250           $45,375           $47,644           $50,026
                    6           $43,250           $47,575           $49,954           $52,451
                    7           $45,250           $49,775           $52,264           $54,877
                    8           $46,750           $51,425           $53,996           $56,696
                    9           $47,300           $52,030           $54,632           $57,363
                    10          $47,550           $52,305           $54,920           $57,666
                    11          $47,800           $52,580           $55,209           $57,969
                    12          $48,100           $52,910           $55,556           $58,333
                    13          $48,750           $53,625           $56,307           $59,122
                    14          $49,401           $54,341           $57,058           $59,911
                    15          $50,051           $55,056           $57,809           $60,700
                    16          $50,702           $55,772           $58,560           $61,488
                    17          $51,352           $56,487           $59,311           $62,277
                    18          $52,002           $57,202           $60,063           $63,066
                    19          $52,653           $57,918           $60,814           $63,854
                    20          $53,303           $58,633           $61,565           $64,643
</Table>



                                       34
<PAGE>   37

                  CAPTAIN, IFR (PIC)/CAPTAIN, FIXED WING (PIC)

<Table>
<Caption>
                                1/1/2001         JUNE 2001         JUNE 2002         JUNE 2003
                  STEP         ANNUAL PAY       ANNUAL PAY        ANNUAL PAY        ANNUAL PAY
                  ----         ----------       ----------        ----------        ----------
<S>              <C>         <C>               <C>               <C>               <C>
                    1           $43,420           $47,762           $50,150           $52,658
                    2           $43,420           $47,762           $50,150           $52,658
                    3           $43,420           $47,762           $50,150           $52,658
                    4           $44,554           $49,009           $51,460           $54,033
                    5           $45,550           $50,105           $52,610           $55,241
                    6           $46,500           $51,150           $53,708           $56,393
                    7           $48,000           $52,800           $55,440           $58,212
                    8           $50,250           $55,275           $58,039           $60,941
                    9           $51,500           $56,650           $59,483           $62,457
                    10          $52,750           $58,025           $60,926           $63,973
                    11          $54,750           $60,225           $63,236           $66,398
                    12          $56,250           $61,875           $64,969           $68,217
                    13          $58,500           $64,350           $67,568           $70,946
                    14          $60,000           $66,000           $69,300           $72,765
                    15          $61,000           $67,100           $70,455           $73,978
                    16          $61,246           $67,641           $71,023           $74,574
                    17          $61,492           $68,182           $71,592           $75,171
                    18          $61,738           $68,724           $72,160           $75,768
                    19          $61,984           $69,265           $72,728           $76,364
                    20          $62,230           $69,806           $73,296           $76,961
                    21          $62,476           $70,347           $73,865           $77,558
                    22          $62,722           $70,888           $74,433           $78,154
                    23          $62,968           $71,430           $75,001           $78,751
                    24          $63,214           $71,971           $75,569           $79,348
                    25          $63,460           $72,512           $76,138           $79,944
                    26          $63,706
                    27          $63,952
                    28          $64,198
                    29          $64,444
                    30          $64,690
                    31          $64,936
                    32          $65,182
                    33          $65,428
                    34          $65,674
                    35          $65,920
</Table>

         2. On the first day of the first pay period in April 2001, each pilot
who was on the pilot payroll as of December 31, 2000 and who is not topped out
in his respective pay scale will move



                                       35
<PAGE>   38

up one step on the appropriate pay scale. This represents approximately a 2.5%
increase for pilots.

         3. On the first day of the first payperiod in June 2001, the Employer
will compress the number of step levels in the Captain, IFR (PIC) pay scale from
thirty-five (35) to twenty-five (25) steps as shown in Section 1 above (Captain,
IFR (PIC) June 2001), and affected Captain, IFR (PIC) pilots' pay will be
increased accordingly.

         4. On the first day of the first payperiod in June 2001, each pilot
will be moved to the pay scales listed in Section 1 above (June, 2001 Annual
Pay). This scale represents a 10% increase over pay scales effective 1/1/2001.

         5. One year following the execution of this Agreement, each pilot will
be moved to the pay scales listed in Section 1 above (2002 Annual Pay). This
scale represents a 5% increase over the pay scales effective June 2001.

         6. On the first day of the first pay period in both April 2002, April
2003 and April 2004, each pilot who was on the pilot payroll as of December 31,
2001, December 31, 2002, and December 31, 2003 respectively, and who is not
topped out in his respective pay scale will move up one (1) step on the
appropriate pay scale. This represents approximately a 2.5% increase for each
year of step increase for pilots.

         7. On the first day of the first pay period in June 2003, each pilot
will be moved to the pay scale listed in Section 1 above (June 2003 Annual Pay).
This scale represents a 5% increase over the pay scales effective 2002.

         8. The Employer has paid to each pilot on the payroll as of December
31, 1999, a one-time retroactive lump sum calculated on the basis of placing the
pilot in his proper step level (generally based on years of service with the
Employer) and the resulting increased regular base rate of pay for the period
between April 2000 (or the pilot's date of employment if after April 2000) and
January 1, 2001.

         9. Workover rate shall be computed by dividing the pilot's yearly base
salary by one hundred eighty-two (182) anticipated yearly workdays on his
assigned work schedule plus 50%. This rate is referred to as the "regular
workover rate."

         10. A pilot who is required to participate in any training required by
the Employer or a customer (other than initial new hire training) outside his
normal work schedule will be paid a regular day's pay for that day (calculated
by dividing his yearly base salary by the number of anticipated work days on his
assigned schedule); provided, however, that he is in training for more than five
(5) hours for that day. If the pilot spends five (5) hours or less in training
as described above he shall be paid one-half (1/2) of a regular days pay for
that day. Pilots participating in initial new hire training will be paid a
regular monthly salary regardless of work schedule for the duration of this
training.



                                       36
<PAGE>   39

                            ARTICLE 22. PILOT BONUSES

         1. Pilots will be eligible for the following bonuses for the period of
time they are working the schedule:

Schedule Bonuses

  Helicopter Pilots

5&2 Schedule (14 hour duty day only)- 25% of base pay up (maximum of
$1,150/month)

2 for 1 Schedule - $1,150 per Month

  Fixed Wing Pilots

New Orleans 5&2 Schedule - $350 per Month

2 for 1 Schedule - $1,150 per Month

                                  Duty Bonuses

Lead Pilot - $25 per day ($30/day if Lead Pilot flies a contract job)
Instructor - $200 per month
Check Airman - $500 per month
Pilot/Mechanic - $500 per month
RMT Pilot - $1,000 per month
Fire/Extended Standby - Extended standby time is determined by the Forestry
     Service and is passed through to the pilot.
First Officer, IFR (SIC) - $125 per month
Captain, VFR (PIC) single pilot medium aircraft (reconfigured to 9 or less
     passengers) - $75 per month (see Note 1 below)
Captain, VFR (PIC) dual pilot VFR medium aircraft (10 passenger of more) - $75
     per month (see Note 1 below)
Heavy Ship First Officer (SIC) (214ST) - $150 per month
Heavy Ship Captain (PIC) (214ST) - $300 per month

                              Certification Bonuses

Airline Transport Pilot Rating- $100 per month

Note 1: To qualify for this bonus, pilot(s) must be permanently assigned as
either single pilot Captain, VFR medium aircraft reconfigured to 9 passenger or
less; or dual pilot Captain, VFR medium aircraft 10 passenger or more. These VFR
medium aircraft configurations will only be at customer request and will usually
be flown with VFR medium aircraft added to Employer's fleet (and are not
anticipated to constitute a significant portion of the Employer's fleet).



                                       37
<PAGE>   40

                           ARTICLE 23. OTHER BONUSES

         1. Offshore Bonus- In addition to his base salary, a pilot who is
required by the Employer or the customer to remain at an offshore location
overnight shall receive twenty-five (25) dollars per night.

         2. Fire Contract Bonus- In addition to his base pay and any other
bonuses, a pilot will receive a fire contract bonus of $100/day when the
aircraft is activated on a fire contract. This bonus shall begin when he reports
to the duty assignment (including reasonable travel time) and shall end when he
is released from the duty assignment (including reasonable travel time).

         3. Safety Award Program- The Employer's safety award program will
continue in its present form (attached as addendum herein). However, the
Employer reserves the right to modify or discontinue the program at its
discretion but agrees to confer with the union prior to doing so.

         4. Holiday Pay- The Employer recognizes six holidays per calendar year:
New Year's Day, Memorial Day, 4th of July, Labor Day, Thanksgiving Day and
Christmas Day. Any pilot who works on an Employer designated holiday shall
receive an additional eight hours pay at his Workover rate.





                                       38
<PAGE>   41

                              ARTICLE 24. WORKOVER

         1. All pilots who work extra duty days over and above their assigned
work schedule will be paid for the extra days worked at a workover rate, except
that all types of training outside the pilot's normal work schedule shall be
paid according to Article 21. Base Pay, Section 9.

         2. Separate workover volunteer lists will be maintained at each base
and at Lafayette Scheduling. These lists will indicate the days the pilot is
willing to "workover" at particular bases on his normal time off. Each list will
include a telephone number (or beeper number) where the pilot may be reached.
Workover will be limited to a maximum of four days for any seven-day off-time
period unless otherwise approved by the business unit manager or Director of
Operations. A pilot who desires to have his name added to the workover list at a
specific base(s) shall notify by Sunday 12 noon in writing (email, fax or
otherwise) the appropriate Area Manager(s) (or their representatives) of his
desire to workover. Each pilot is limited to requesting workover at two (2)
specific bases, however, he may also send his workover request to Lafayette
Scheduling. This request shall include the pilot's name and contact number, the
date(s) the pilot is available for workover, the aircraft the pilot is qualified
to fly, his current job assignment and the date of his last workover. If the
pilot is assigned offshore and has no means of notifying the base(s) except by
telephone, the base will accept and note on the workover list such verbal
notification for this pilot. If the pilot is willing to workover at any base, he
will send his workover request to Lafayette Scheduling and will include the
information listed above. Each workover list will be purged at the end of each
calendar quarter and pilots who desire workover will be required to resubmit
their workover requests as described above.

         3. The Employer will first attempt to award workover to pilots with off
days between training and their normal work hitch. For other available workover
the Employer will allow the pilot in the order described below to choose which
workover he desires to work. Available workover will be awarded in the following
order: a) to pilots on that job at the base, b) on a rotating basis to all other
pilots on the workover list starting with the pilot who reported the greatest
length of time since his last workover at that base. In the event two or more
pilots report the same length of time since their last workover, the pilot with
the most bidding seniority will receive the workover. When a base workover list
is exhausted, Lafayette Scheduling will provide a pilot for the workover on the
same basis as described above. When the workover lists are exhausted, the
Employer may fill the position with any qualified pilot who is employed by the
Employer. If the Employer is still unable to fill the job requirement under the
procedures outlined in this Article, workovers shall be assigned based on
bidding seniority, starting with the least senior qualified pilot, except that
once a pilot has worked three (3) such workover days per calendar year, the next
least senior qualified pilot shall be required to accept the next mandated
workover until he reaches three such workover days and so on until the seniority
list is depleted. Further assigned workovers would then revert to the least
senior pilot until he reaches six (6) mandated workover days in a calendar year
and then continue as described above.

Once the pilot has accepted a workover assignment, it may not be changed without
prior mutual agreement between the pilot and the Employer.



                                       39
<PAGE>   42

         4. The pilot will designate on the workover request form with the Area
Manager (or his representative) if he is available for "emergency workover"
(workover opportunity which requires the pilot to report within two hours).
Qualified pilots will be selected for emergency workovers on the same basis as
described in Section 3 above.

         5. A pilot may request and be approved by the Employer to take
compensatory time in lieu of receiving workover pay. A pilot will be compensated
at his regular base pay for any approved compensatory time taken.

         6. A pilot will be passed over for workovers when:

            A.    A pilot is not qualified.

            B.    A customer requests a certain pilot or requests that a certain
                  pilot not fly his job.

            C.    There is a conflict with a pilot's regular job (i.e., FAR
                  limitations).

            D.    The dates of a pilot's availability conflict with the length
                  of the workover requirement.

            E.    An off-duty pilot does not answer a phone call from the
                  Employer or does not return a message left on his answering
                  machine within fifteen (15) minutes. The time and date of the
                  attempted call to contact the pilot will be documented by the
                  Employer.

            F.    A pilot is unable to give a definitive answer at the time of
                  the call.

            G.    An off-duty pilot will be allowed to use a beeper as his
                  contact number only for normal workovers and will have fifteen
                  (15) minutes to respond to his page or he will be passed over
                  for a workover assignment. The pilot is responsible to make
                  certain that his beeper is in working order.

            H.    An on-duty pilot cannot be contacted within two (2) hours.

         7. A pilot who has expressed interest in workover and subsequently
twice refuses a workover without having previously removed his name from the
workover request list will be removed from the workover list for the next four
(4) calendar weeks, and he may not put his name back on that specific workover
list during this period.

         8. The Director of Training or his designee shall determine workover in
the Training Department. The Director of Operations and the Director of Training
(or their designees) shall determine placement of Instructor/Check Airmen in the
performance of their duties, including line checks.

         9. For jobs that are assigned to pilot/mechanics, any qualified
pilot/mechanic will be called first for those workover assignments.

         10. If a pilot on a Gulf of Mexico assignment is required to remain
overnight due to head-to-head crew change requirements, he will receive workover
pay based on duty time rounded to the next hour with a minimum of two (2) hours
and a maximum of one full day workover once he has been on duty at least eight
(8) hours for that day.



                                       40
<PAGE>   43

         11. The Employer reserves the option to pay a premium rate (e.g.
workover) for all time it deems appropriate due to operational necessity. The
Employer will meet and confer with the Union prior to implementing a premium
rate.

         12. A pilot attending any training required by the Employer or a
customer outside his normal work schedule will not be eligible for workover for
those days spent in training.

         13. For three (3) months after the execution of this agreement, the
remedy for inadvertent Employer errors in awarding workover shall be that the
affected pilot or pilots shall receive priority consideration without regard to
the length of time since his last workover or his bidding seniority for the
number of workovers which corresponds to the workover error only where the pilot
is qualified and acceptable to the customer, however, Section 6 above shall
apply to any offer of workover under this Section.

         14. Three (3) months after the execution of this Agreement, the parties
will meet to determine if any changes should be made in the terms of this
Article. If the parties mutually agree to changes, this Article shall be amended
accordingly. In any event after the three month trial period, the additional
remedy for Employer errors will be one (1) hour workover paid for each workover
day missed due to the error, up to a maximum of four (4) hours workover pay.





                                       41
<PAGE>   44

                             ARTICLE 25. TRAVEL PAY

         1. If a pilot is required to move between two or more field bases or
another PHI designated location during his normal work schedule and that pilot
uses personal transportation, a mileage allowance equal to the IRS standard
mileage rate per mile will be paid. A mileage allowance will also be paid if a
pilot is required to go directly from one base to another for workover in
conjunction with that person's regular work hitch. Such mileage allowance will
be paid on the basis of an Employer approved mileage chart calculated using the
most direct route between bases.

         2. The Employer shall make reasonable efforts to enter into Additional
Crew Member Agreements (ACM) with other air transportation carriers. The
Employer shall provide a photo identification card that clearly identifies the
employee as a pilot on his next occasion of recurrent training.





                                       42
<PAGE>   45

                              ARTICLE 26. PER DIEM

         1. A pilot shall receive per diem when company housing is provided as
described in Article 18. Facilities & Equipment, Section 1.

         2. A pilot cannot receive both an offshore bonus and per diem for the
same workday.

         3. Per diem shall be paid as follows:

            A.    Three (3) dollars per meal to a maximum of nine (9) dollars
                  per day when the pilot is working at his regularly assigned
                  base.

            B.    Five (5) dollars per meal to a maximum of fifteen (15) dollars
                  per day for:

                  (1)   Pilots assigned to the pilot pool;

                  (2)   Replacement pilots for EMS;

                  (3)   A pilot on a regular work schedule who is required to
                        relocate via vehicle or aircraft after arriving at his
                        assigned base;

                  (4)   A pilot attending training at locations other than PHI
                        facilities (e.g., Flight Safety Training); and

                  (5)   A pilot assigned to an offshore contract and normally
                        required to remain offshore who is required to RON
                        onshore during his work schedule




                                       43
<PAGE>   46

                         ARTICLE 27. INSURANCE BENEFITS

         1. The Employer shall offer welfare benefits for Pilots equal in
benefits and employee premiums to that of the company's non-represented
employees. This includes, but is not limited to, Medical Insurance, Dental
Insurance, Term Life Insurance, Employee and Dependent Supplemental Life
Insurance, LTD coverage, Medical Loss of License Coverage, Medical and Dependent
Care Spending Accounts, Employee Assistance Program, and Vision Discount
Program.

         2. Effective January 1, 2002, the Employer will modify its Term Life
Insurance Plan to provide at no cost to each employee, including pilots covered
under this Agreement, one and one-half (1 1/2) times his annual base salary in
life insurance coverage and an equal amount of coverage under Accidental Death
and Dismemberment (AD&D). The Employer will make reasonable efforts with the
Insurance provider to avoid having the additional Employer-provided Life
Insurance affect the amount of Supplemental Life Insurance and AD&D "buy-up"
coverage which is now available to the employee.





                                       44
<PAGE>   47

                             ARTICLE 28. 401(k) PLAN

         1. The Employer shall match a participating Pilot's 401(k) plan salary
deferral contribution two dollars for each dollar the pilot contributes up to a
maximum of the pilot's first three (3) percent of gross earnings bi-weekly,
exclusive of bonuses.

         2. The Employer will separate the 401(k) plan for pilots covered by
this agreement from other 401(k) plan participants.





                                       45
<PAGE>   48

                       ARTICLE 29. GENERAL & MISCELLANEOUS

         1. Any pilot leaving the service of the Employer shall, upon written
request to the Human Resources Department, be provided with a letter setting
forth the Employer's record of his job classification, length of service and
rate of pay at the date of his termination.

         2. The pay period is currently every fourteen (14) days (bi-weekly). If
the Employer wishes to change the pay period timing, it shall meet and discuss
the change with the Union prior to implementation. The Employer shall continue
to offer, on a voluntary basis, Electronic Funds Transfer (EFT) to the pilot's
bank of choice.

         3. When there is an error in the pay of a pilot, this error will be
corrected as soon as possible, not to exceed five (5) business days following
notification.

         4. If the Employer decides to place into service aircraft other than
those already in service at the time of execution of this Agreement, the
Employer will confer with the Union as soon as possible and prior to
establishing rates of pay, rules and working conditions applicable to the new
aircraft. If the Employer decides to place into service any aircraft of
substantially different design, configuration (e.g., tiltrotor aircraft, CH54)
or cargo/passenger capacity of twenty-two (22) or more passengers, either party
may request a mediator from the National Mediation Board to participate in
interest based bargaining discussions for a period of up to sixty (60) days
prior to the Employer implementing rates of pay, rules and working conditions
applicable to the new aircraft.

         5. A pilot's personal items lost or damaged due to an aircraft accident
or incident will be reimbursed by the Employer at the replacement costs of such
items, provided, however, that the Employer reserves the right to require
reasonable proof of loss and value of such personal items.

         6. In the event the Employer requires an off-hitch pilot to report in
person for a meeting with management for any reason, except in cases where
discipline is imposed following the meeting or as otherwise provided in the
Training Article, the pilot will receive workover pay for all hours spent in
such meeting, with a minimum of two hours workover and a maximum of a full day
of workover for each day spent in such meetings. Except in cases where
discipline is imposed following the meeting or as described in Article 17.
Training, the Employer will also reimburse the pilot for mileage, lodging and
per diem at rates described in this Agreement.

         7. Pilots shall not engage in business activities which are in
competition with the Employer or interfere with the pilot's performance of his
Employer duties, without first obtaining the written approval of the Employer.
This section shall not be construed to prohibit pilots from affiliating with or
performing duties for the Armed Forces of the United States of America.

         8. Pilots will be required to ensure the aircraft is secure (e.g.- tie
down kit installed), engine(s) rinsed and dried, and a reasonably clean and
orderly cockpit. To the extent that such duties would interfere with the pilot's
availability for duty on the following day, the pilot will be excused from these
duties.



                                       46
<PAGE>   49

         9. Pilot duty positions are as follows: Captain, IFR; First Officer,
IFR; and Captain, VFR.



                                       47
<PAGE>   50

                     ARTICLE 30. SAFETY/ACCIDENT PREVENTION

         1. The Employer and the Union recognize their duty and responsibility
to ensure the safety of our customers and employees. It is agreed that:

            A.    Safety is the primary consideration in all aspects of the job;

            B.    Safe working conditions, proper training, proper equipment and
                  appropriate protective devices are essential elements in this
                  safety and accident prevention effort;

            C.    The Employer will train pilots in any new aircraft, its
                  components or on any new procedures which pilots may be
                  required to utilize;

            D.    All pilots must follow PHI safety policies and procedures,
                  including safety practices as published and taught. Following
                  safe work practices is a condition of employment.

            E.    Both PHI and the pilots shall adhere to all applicable Federal
                  Aviation, or other controlling Regulations.

            F.    The Employer will ensure the continuation of the Notice to
                  Airmen (NOTAM) system and weather reporting system.

         2. The parties agree to create a joint Safety Committee, which shall
consist of two representatives designated by the Employer and two pilots
designated by the Union. The role of the Safety Committee shall be to jointly
review pilot recommendations on safety and accident prevention measures. Pilot
representatives shall function in an advisory capacity. The Safety Committee
will meet periodically as necessary, but no less than once each quarter.

         3. The Union agrees to encourage pilots to engage in safe work
practices and to communicate safety issues to the designated management
representative identified in Section 4 below.

         4. The Employer designates the Director of Safety as the management
representative to be responsible for receiving safety complaints.

         5. The Employer and the Union shall cooperate in seeking feasible
solutions to help reduce accident frequency and severity rates.

         6. The Employer will endeavor to equip its fleet of domestic aircraft
with Traffic Alert Systems by seeking customer participation in the funding of
such equipment.

         7. The Employer will endeavor to equip all aircraft operated under
instrument flight rules (IFR) with approved flight directors by seeking customer
participation in the funding of such equipment.




                                       48
<PAGE>   51

               ARTICLE 31. SEXUAL AND WORKPLACE HARASSMENT POLICY

         1. It is agreed that the Employer, as a responsible corporate citizen,
is committed to maintaining a hospitable, cooperative work environment that
promotes professionalism, common courtesy and mutual respect among all levels of
employees, supervisors, managers, and executives. To advance that commitment,
the Employer has adopted and will communicate to employees the Sexual and
Workplace Harassment Policy (attached as Appendix A) that strictly prohibits
sexual and workplace harassment on the basis of race, color, creed, gender,
religion, national origin, age, sexual orientation or disability. This policy
shall not be amended during the term of this agreement unless required by law.

         2. The Union agrees to support the provisions of the PHI Corporate
Sexual and Workplace Harassment Policy. Each pilot will be required to read,
understand and sign an acknowledgement of this policy, which will be placed in
his personnel file.





                                       49
<PAGE>   52

                      ARTICLE 32. ENVIRONMENTAL COMPLIANCE

         1. It is agreed that the Employer, as a responsible corporate citizen,
is committed to protecting human health, natural resources and the environment.
This commitment is an important aspect of daily corporate operation and
administration, and reaches further than mere compliance with the law - it
encompasses the incorporation of sound environmental practices into all of our
business decisions. To advance this commitment, the Employer has adopted and
will communicate to employees the Corporate Environmental Policy (attached as
Appendix B) that defines the responsibilities of the Employer and the employees.
This policy shall not be amended during the term of this agreement unless
required by law.

         2. The Union agrees to support the provisions of the PHI Corporate
Environmental Policy. Each pilot will be required to read, understand and sign
an acknowledgement of this policy, which will be placed in his personnel file.





                                       50
<PAGE>   53

                        ARTICLE 33. NO STRIKE, NO LOCKOUT

         1. The Union agrees it will not, under any circumstances or for any
reason, call, encourage, authorize or engage in any strike, slow down or other
concerted activity or hindrance to work during the term of this Agreement.

         2. Any Pilot who engages in any activity described in section one of
this Article will be subject to discharge, and such discharge will not be
subject to the grievance procedure and System Board of Adjustment provisions of
this Agreement, except as to the question of whether the Pilot engaged in such a
violation.

         3. The Employer agrees not to lock out Pilots during the term of this
Agreement.

         4. If the Employer knows that one of its customers is being picketed,
the employer will notify the Pilot about the picket line before dispatching the
Pilot to the location of the picket line.

         5. A Pilot may refuse to take an assignment to cross a picket line if
he has reasonable safety concerns. In any such case, the Company will be
permitted to service the customer the best way possible.







                                       51
<PAGE>   54

                          ARTICLE 34. MANAGEMENT RIGHTS

         1. The Employer reserves and retains, solely and exclusively, all of
the rights, privileges and prerogatives which it had or possessed prior the
execution of this Agreement, regardless of the frequency or infrequency with
which such rights have been exercised in the past, except to the extent that
such rights, privileges and prerogatives are specifically abridged by the
expressed provisions of this Agreement.

         2. Without limiting the generality of the foregoing, the sole and
exclusive rights of management which are not abridged by this Agreement include,
but are not confined to, the full and exclusive control, direction and
supervision of the workforce; the hire, promotion, demotion, transfer, layoff or
reassignment of pilots; the discipline and discharge for cause of pilots; the
selection of pilots and the determination of the qualifications for pilot
selection; the determination of the size and composition of the workforce; the
determination of schedules; the determination of pilot job content and the
amount and types of flight duties required; the scheduling of the hours and days
to be worked on each job and each shift; the selection and determination of the
number of pilots required, and the assignment of work to pilots; the contracting
out or subcontracting of work; the equipment to be utilized; the establishment
and enforcement of standards for the quality and quantity of work required to be
performed by pilots; the right to require physical exams and testing of pilots;
the right to introduce new or improved methods or facilities and/or the
discontinuance of existing methods or facilities; the discretion to suspend or
cease its operations or any phase or part of its business or operations; the
right to make, amend and enforce work and safety rules and regulations; and the
right to discontinue, transfer or assign all or any part of its operations, and
to establish new jobs and abolish or change existing jobs.





                                       52
<PAGE>   55

                       ARTICLE 35. DISCIPLINE & DISCHARGE

         1. Pilots may be subject to disciplinary actions, up to and including
discharge for just cause including violation or infraction of company rules or
policies, or for violating this Agreement. The severity of the infraction will
determine the nature of the disciplinary action, which can range from a verbal
warning to a written warning, suspension or discharge.

         2. In case a pilot is called into a meeting to discuss possible
disciplinary action against him, the pilot may request to be accompanied by his
Steward, and such a request will be granted by the Employer, if the Steward or
his alternate is available within a reasonable time, not to exceed twenty four
(24) hours.

         3. Upon his request, a pilot's personnel file shall be open for his
inspection during normal office hours in the presence of an employer
representative, upon reasonable notice. Nothing of a derogatory nature will be
placed in the pilot's personnel file unless a copy is provided to the pilot.
Upon receipt of such a document, the pilot shall have the option of responding
by submitting a written rebuttal that will be placed in his personnel file. It
the Employer determines that the pilot's comments invalidate the document in
question, the document will be removed from the pilot's personnel file.

         4. Customer complaints or correspondence of a derogatory nature shall
not serve as the basis for discipline after twelve (12) months from the date of
issuance unless within the 12 month period there has been a recurrence of the
same or similar nature.

         5. Disciplinary records involving the performance of his duties as a
pilot shall not serve as the basis for any discipline after five (5) years from
the date of issuance unless within the five (5) year period there has been a
recurrence of the same or similar nature.

         6. In any case in which a pilot receives a formal reprimand or is
discharged, a Human Resources Representative will ask the pilot if he desires
that a copy of the disciplinary document be sent to a representative designated
by the Union. If the pilot does so desire, the Human Resources Representative
will promptly forward a copy of the document to the designated Union
representative.




                                       53
<PAGE>   56

                         ARTICLE 36. GRIEVANCE PROCEDURE

         1. Disputes relating to the interpretation or application of this
Agreement may be the subject of a grievance. A grievance shall mean a dispute
between an employee(s) or the Union and the Employer with respect to the
interpretation or application of this Agreement.

         2. Any such grievance shall be processed in the following matter:

            Step 1. The pilot shall first attempt to resolve the grievance with
                    his immediate supervisor within seven (7) calendar days from
                    the date of the occurrence of the event giving rise to the
                    grievance, or within seven (7) calendar days of the date the
                    pilot knew or should have known of such event not to exceed
                    twenty eight (28) calendar days from the date of the event.
                    The supervisor shall give his answer within seven (7)
                    calendar days from that date.

            Step 2. If the grievance is not resolved at Step 1 to the
                    satisfaction of the grievant, the grievance shall be reduced
                    to writing and presented to the designated representative of
                    the Employer within ten (10) calendar days after the receipt
                    of the immediate supervisor's answer. The written grievance
                    must state the nature of the grievance, the circumstances
                    out of which it arose, the remedy or correction requested
                    and the specific provisions of the Agreement alleged to have
                    been violated. The Employer representative will give his
                    answer to the grievant in writing with a copy to the Union
                    within ten (10) calendar days after the receipt of the
                    grievance.

            Step 3. In the event the decision by the Employer representative
                    is unacceptable to the aggrieved party, it may be appealed
                    in writing to the designated representative of the Employer
                    with seven (7) days of the receipt of the decision. The
                    appeal must include a statement of the reasons the grievant
                    believes the decision was erroneous. The Employer's
                    representative shall render a decision on the appeal in
                    writing within fourteen (14) calendar days of receipt of the
                    appeal. In the event the decision at Step 3 is unacceptable
                    to the grievant, the Union may appeal to the System Board of
                    Adjustment in accordance with Article 37 of this agreement.

         3. In the event a non-probationary pilot who has been discharged wishes
to grieve such discharge, the grievance must be presented at Step 2 within seven
(7) calendar days after the termination.

         4. All provisions of this Article shall apply to Employer and Union
grievances except that such grievances shall be presented to the designated
representative of the other party at Step 2.

         5. Any grievance not presented and processed in the manner, and within
the time limits set forth above, shall be waived provided, however, at any time
in advance of the expiration of such time limit the parties may agree, by mutual
written consent, to extend any time limit for a specified period of time.
Compliance with all time limits specified in this Article shall be determined by
the date of mailing as established by postmark, or by the date of hand delivery.

         6. No grievance, the basis for which occurred prior to the execution of
this Agreement, shall be considered.



                                       54
<PAGE>   57

         7. The Employer and the Union agree to furnish to the other party the
names of their designated representatives charged with administration of the
grievance procedure within thirty (30) calendar days after the execution of this
Agreement. Any changes in these representatives shall be furnished to the other
party in writing.

         8. In the event a pilot is suspended pending an investigation of
alleged misconduct, the pilot shall be informed of the nature of the alleged
misconduct at the time of suspension.

         9. The Union and the Employer may, by mutual agreement in writing,
elect to bypass any or all steps in this Article and proceed to the System Board
of Adjustment in accordance with Article 37 of this Agreement.





                                       55
<PAGE>   58

                     ARTICLE 37. SYSTEM BOARD OF ADJUSTMENT

         1. In compliance with Section 204, Title II of the Railway Labor Act,
as amended, this Agreement establishes a System Board of Adjustment, which shall
be called the Petroleum Helicopters Pilots' System Board of Adjustment,
hereinafter called "the Board."

         2. The Board has jurisdiction over timely filed and appropriately
processed grievances arising out of the interpretation and application of this
Agreement relating to rates of pay, rules, working conditions, discipline and
discharge. The procedures set forth in this Article are the exclusive and
mandatory forum for all such disputes.

         3. The Board does not have jurisdiction over any dispute unless all of
the procedures required by the Grievance Procedure provided for in this
Agreement have been timely and completely exhausted in the dispute, and the
dispute has been properly submitted to the Board pursuant to the provisions of
this Article.

         4. The Board has no jurisdiction to modify, add to or otherwise alter
or amend any of the terms of this Agreement.

         5. The Board shall consist of four members, two of whom shall be
selected and appointed by the Employer and two of whom shall be selected and
appointed by the President of the Local Union. A Board member appointed by the
Union shall serve as chairman and a Board member appointed by the Employer shall
serve as vice-chairman in even years, and a Board member appointed by the
Employer shall serve as chairman and a Board member appointed by the Union shall
serve as vice-chairman in odd years. The vice-chairman shall act as chairman in
his absence. Each Board member has a vote in connection with all actions taken
by the Board. In the event the four Board members cannot reach a decision with
respect to a particular dispute, the Board will select a neutral member who will
decide the dispute. In the event the Board cannot agree on a neutral member,
within ten (10) calendar days thereafter either party may request that the
American Arbitration Association (AAA) submit a list of seven potential
neutrals, and the neutral shall be selected in accordance with the rules of AAA.

         6. The Board will meet quarterly in Lafayette (unless a different
location is agreed upon by the members of the Board), provided that at such time
there are cases on file with the Board for its consideration.

         7. Any expenses incurred by Board memberS appointed by one of the
parties to this Agreement will be paid by that party. Any pilot called as a
witness by the neutral will suffer no loss of pay as a result of testifying at
any hearing before the neutral. The fees and expenses of any neutral member of
the Board shall be borne equally by the Employer and the Union

         8. Disputes may only be submitted to the Board by the President of the
Local Union or a duly designated officer of the Union or the Employer.



                                       56
<PAGE>   59

         9. Decisions by the Board are final and binding on the Employer, the
Union and the affected pilots.

         10. The party appealing a final decision under the Grievance Procedure
in this Agreement shall submit the dispute for consideration by the Board,
including all papers and exhibits, within fourteen (14) calendar days of that
decision. If the appeal is not made with this fourteen day period, the Board
does not have jurisdiction over the dispute.

         11. All disputes referred to the Board shall be sent to the Director of
Human Resources of the Employer and his office shall assign a docket number
according to the order in which the dispute is received.

         12. The appealing party will ensure that a copy of the petition is
served on the members of the Board.

         13. Each case submitted to the Board must state:

                  A.    The question or questions at issue;

                  B.    a statement of the facts with supporting documents;

                  C.    a reference to the applicable provisions of the
                        Agreement alleged to have been breached;

                  D.    the position of the aggrieved party;

                  E.    the remedy requested; and

                  F.    the position of the opposing party.

         14. Decisions by the Board shall be rendered no later than thirty (30)
days after the close of the hearing.

         15. The Employer and the Union shall, in good faith, attempt to make a
joint submission of their dispute to the Board. If the parties are unable to
agree on a joint submission, the appealing party shall file a submission with
the Board containing all of the information described in Section 13 of this
Article, and the responding party may do the same. Any party filing a submission
with the Board pursuant to this Article shall serve a copy of its submission
with the other party.

         16. The parties agree that each Board member is free to discharge his
duties in an independent manner without fear of retaliation from the Employer or
the Union because of any action taken by him in good faith in his capacity as a
Board member.




                                       57
<PAGE>   60

                        ARTICLE 38. UNION REPRESENTATION

         1. In the event it is necessary for a Union representative to enter the
Employer's premises to discuss the application of this Agreement, the Union
representative shall notify the manager for the particular location, and they
shall arrange a mutually satisfactory time, date and place for the visit within
a ten (10) day period thereafter. The Union representative shall not take any
action that would interrupt or in any way interfere with the Employer's
operations or the job duties of any employee. A representative of the Employer
may accompany the Union representative, if the Employer desires.

         2. The Employer will not be obligated to deal with any Union
representative who has not been designated in writing to be an authorized
representative of the Union.

         3. The Union may elect or appoint Pilots to be primary job steward(s)
and alternate(s) to conduct Union business and shall notify the employer, in
writing, of their election, appointment or removal. Pilots who have been
designated as primary stewards (and the alternate steward in the absence of the
primary steward) shall be granted reasonable time to investigate, present and
process grievances during their own duty hours without loss of pay to the extent
such activity does not interfere with the performance of their duties or the
duties of other employees. Stewards who serve their fellow pilots shall be
considered Union representatives.

         4. The Employer and the Union desire that complaints and grievances
shall be settled whenever possible with supervisors at the location where the
complaint or grievance originates. It is understood and agreed that a steward's
activities shall fall within the scope of the following functions:

            A.    To consult with a pilot(s) regarding a presentation of a
                  complaint or grievance which the pilot(s) desires to present.
                  Stewards shall be permitted to present grievances to
                  management and attempt to resolve any grievance.

            B.    To present a grievance or complaint to a pilot's immediate
                  supervisor in an attempt to settle the matter. To the extent
                  that it doesn't interfere with the Employer's operations,
                  Stewards shall be granted the right to consult with pilots at
                  their base for the purpose of enforcing the provisions of this
                  agreement.

            C.    To investigate a complaint or grievance of record in
                  accordance with the Grievance Procedure.

         5. Stewards and alternate stewards shall be considered union
representatives. The Employer and the Union agree that a minimum amount of time
shall be spent in the performance of steward duties.

         6. Effective on the date of the execution of this Agreement, the Union
may designate one pilot who will be permitted to act as a full-time Union
Officer during his normal shift without loss of pay; provided, however, that
this Section of this Article shall expire on the 31st day of May, 2004. The
normal shift for this pilot will be Monday through Friday each week and he will
be required to submit a monthly time sheet approved by the Union. Any sick days
or vacation days shall be charged against the pilot's appropriate VSTO or STO
bank. This pilot will be permitted



                                       58
<PAGE>   61

to perform workovers to the extent necessary to maintain his pilot currency and
proficiency and may also bid on other workover on his days off in accordance
with Article 24 of this Agreement. Any workover requested by the Employer during
his regular shift will be compensated at a rate of 50% above his base rate of
pay, and all workovers outside his shift shall be compensated at 150% of his
base rate of pay. Such pilot shall be eligible for the 5&2 Pilot Bonus but will
not be eligible for other bonuses except when he actually works as a pilot. This
pilot will continue to accrue seniority and will be entitled to all wage
adjustments and benefits provided for in this Agreement.





                                       59
<PAGE>   62

               ARTICLE 39. UNION BULLETIN BOARDS & COMMUNICATIONS


         1. The Employer shall permit the Union to display an unlocked bulletin
board at each base that is company owned. The Union shall purchase the bulletin
boards and shall be responsible for their installation. The bulletin board shall
be a maximum of four (4) feet by five (5) feet. The bulletin boards shall only
be placed in areas that have been agreed to by the Employer in advance.

         2. The bulletin boards used by the Union and Pilots covered by this
agreement shall be for posting notices of Union social and recreational affairs,
meetings and elections.

         3. General distributions, posted notices and official business will
bear the seal or signature of an officer of the Union or a Pilot representative
and will not contain anything defamatory, derogative, inflammatory, negative, or
of a personal nature attacking the Employer or its representatives.

         4. The Employer may refuse to permit any posting that would violate any
of the provisions of this Agreement. Any notices posted that are not in
accordance with this Article shall be removed by the Union or by the Employer
upon notice to the Union.






                                       60
<PAGE>   63

           ARTICLE 40. UNION MEMBERSHIP, DUES, AGENCY FEES & CHECKOFF

         1. Membership in the Union is not compulsory for any pilot employed as
of the date of this agreement or any pilot subsequently hired through May 30,
2004. These pilots have the right to join, not join, maintain, or drop their
membership in the Union as they see fit. Neither party shall exert any pressure
on, or discriminate against a pilot as regards such matters.

         2. Each pilot covered by this agreement who is hired on or after May
31, 2004, shall become a member of the union or an agency fee payer within sixty
(60) days after his/her date of hire, and shall be required as a condition of
continued employment by the Employer to maintain his/her membership in the Union
or pay an equivalent agency fee, so long as this Agreement remains in effect.
The agency fee referred to in this Section shall be equal to the Union's regular
and usual initiation fee and its regular, uniform and usual monthly dues.
Notwithstanding the foregoing, nothing herein shall be construed to be in
violation of or in conflict with the provisions of the Railway Labor Act.

         3. During the life of this Agreement, the Employer agrees that upon
receipt of a properly executed Authorization of Payroll Deduction, voluntarily
executed by a pilot, it will make bi-weekly deductions from the pilot's earnings
after other deductions authorized by the pilot or are required by law have been
made, to cover his current standard bi-weekly union dues, assessments and/or
initiation fees or agency fees uniformly levied in accordance with the
Constitution and bylaws of the Union as set forth in the Railway Labor Act.

         4. Any authorizations for payroll deductions under this Article shall
be effective the first day of the month following its receipt by the Payroll
Department and shall apply to the next paycheck for which dues deduction or
agency fees is made.

         5. The Employer remittance to the union will be accompanied by a list
of the names of the pilots for whom the deductions have been made in that
particular month and the individual amounts deducted.

         6. Collection of dues or agency fees not deducted because of
insufficient current earnings, dues or agency fees missed because of clerical
error or inadvertent error in the accounting procedure, or dues or agency fees
missed due to delay in receipt of the Authorization for Payroll Deductions,
shall be the responsibility of the Union and shall not be the subject of payroll
deductions from subsequent paychecks, and the Employer shall not be responsible
in any way for such missed collections. It shall be the Union's responsibility
to verify apparent errors with the individual Pilot prior to contacting the
Payroll Department. The total or balance of unpaid dues, assessments and/or
initiation fees or agency fees due and owing the Union at the time a Pilot
terminates his employment shall be deducted from the final paycheck in
accordance with applicable law.

         7. An Authorization for Payroll Deduction under this Article shall be
irrevocable for the term of this Agreement, or for a period of one (1) year from
the date the Authorization is first executed, whichever occurs sooner.
Revocation shall become effective when the pilot serves written notice on the
Payroll Department to revoke such Authorization for payroll deduction. An
Authorization for Payroll Deduction shall automatically be revoked if:

            A.    the Pilot transfers to a position with the Employer not
                  covered by the agreement;

            B.    the Pilot's service with the Employer is terminated;

            C.    the Pilot is furloughed; or

            D.    the Pilot is on an authorized leave of absence.



                                       61
<PAGE>   64

         8. The Union agrees to hold the Employer harmless and to indemnify the
Employer against any suits, claims, liabilities, and reasonable and customary
attorneys' fees which arise out of or by reason of any action taken by the
Employer under the terms of this Article.




                                       62
<PAGE>   65

                           ARTICLE 41. SAVINGS CLAUSE

         1. Should any part of this Agreement be rendered or declared invalid by
reason of any existing or subsequently enacted legislation, act of government
agency, or by any decree of a court of competent jurisdiction, such invalidation
of such part or portion of this Agreement shall not invalidate the remaining
portions hereof, and they shall remain in full force and effect.

         2. In the event that any provisions of this Agreement are in conflict
with or are rendered inoperative or unlawful by virtue of any duly enacted law
or regulation or any governmental agency or commission having jurisdiction over
the Employer, the Union and Employer will meet and attempt to negotiate changes
necessary, pertaining only to those provisions so affected or directly related
thereto.




                                       63
<PAGE>   66

                              ARTICLE 42. DURATION

         1. This Agreement shall be effective from the 1ST day of June, 2001
through the 31ST day of May, 2004 and shall automatically renew itself from year
to year thereafter, unless written notice of intended change is served in
accordance with Section 6, Title I of the Railway Labor Act, by either party at
least sixty days prior to the termination date or any anniversary thereof.

                       Dated this 12th day of July, 2001.


<Table>
<Caption>
OFFICE AND PROFESSIONAL                 PETROLEUM HELICOPTERS, INC.
EMPLOYEES INTERNATIONAL
UNION

<S>                                     <C>
By: /s/ Jack Bowers                     By: /s/ Richard Rovinelli
    ------------------------------          ----------------------------------

OFFICE AND PROFESSIONAL                 PETROLEUM HELICOPTERS, INC.
EMPLOYEES INTERNATIONAL
UNION, LOCAL 108

By: /s/ Stephen D. Ragin                By: /s/ Michael Hurst
    ------------------------------          ----------------------------------

OFFICE AND PROFESSIONAL                 PETROLEUM HELICOPTERS, INC.
EMPLOYEES INTERNATIONAL
UNION

By: /s/ Mike Dorsett                    By: /s/ Carlin Craig
    ------------------------------          ----------------------------------

OFFICE AND PROFESSIONAL                 PETROLEUM HELICOPTERS, INC.
EMPLOYEES INTERNATIONAL
UNION

By: /s/ Herbert J. Jenssen              By: /s/ Edward Gatza
    ------------------------------          ----------------------------------

OFFICE AND PROFESSIONAL
EMPLOYEES INTERNATIONAL
UNION

By: Paul Bohelski
    ------------------------------
</Table>




                                       64
<PAGE>   67

                             LETTER OF AGREEMENT #1



                                 APRIL 27, 2001


Dear Captain Ragin:

Both parties recognize the importance of disability benefits to employees;
therefore, it is agreed that the Employer and the Union will form a joint labor
management committee that will initially meet no later than September 1, 2001.
The Committee will explore alternatives for short-term disability benefits and
consider the possibility of rapid reaccrual as part of sick time off (STO).


Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin





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<PAGE>   68

                             LETTER OF AGREEMENT #2



                                 APRIL 27, 2001


Dear Captain Ragin:

Within thirty (30) days after the execution of this Agreement, the parties will
meet for the purpose of establishing a "Joint Implementation/Resolution
Committee."




Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin






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<PAGE>   69

                             LETTER OF AGREEMENT #3



                                  JULY 12, 2001


Dear Captain Ragin:

The parties agree under Article 6, that the floppy disk version of the seniority
list would be sent to the Secretary/Treasurer of the OPEIU Local 108, and that
such seniority lists shall contain all represented pilots with the following
information for each: 1) seniority number (based on bidding seniority), 2) pilot
name, 3) bidding seniority date, 4) company seniority date, and 5) status of the
pilot (including highlighting new hire pilots for the first seniority report
subsequent to their employment).

The parties also agree under Article 6, Seniority List, Section 3, that the
pilots' right to protest to the Employer any omission or incorrect posting of
the seniority list shall mean that a pilot shall have a single protest for any
unique seniority date, and will have no further protests rights as long as the
Employer does not change that date in future seniority postings.




Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin






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<PAGE>   70

                             LETTER OF AGREEMENT #4



                                  JULY 12, 2001


Dear Captain Ragin:

The parties agree under Article 12, Paid Days Off and Banked Days, that both
VSTO and STO accrual banks will be calculated and accrued to a pilot by the
Employer on a bi-weekly (pay period) basis instead of a monthly basis.




Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin





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<PAGE>   71

                             LETTER OF AGREEMENT #5



                                  JULY 12, 2001


Dear Captain Ragin:

The parties agree under Article 22, Pilot Bonuses, that all pilot bonuses shall
be effective June 4, 2001 and will be paid to pilots as soon as practical.

The parties also agree under Article 22, that Air Evac operations shall have no
Lead Pilots. However, each base may have a Pilot Base Coordinator, who will be
responsible for some, but not all, duties of a Lead Pilot, and the Employer
shall pay such designated Pilot Base Coordinator a bonus of $200 per month.



Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin






                                       69
<PAGE>   72

                             LETTER OF AGREEMENT #6



                                  JULY 12, 2001


Dear Captain Ragin:

The parties agree under Article 24, Workover, that reference to "the greatest
length of time since his last workover at that base" in Section 3 will be
modified to "the greatest length of time since his last workover date." In order
to maintain an accurate last workover date for each pilot, the parties agree
that a pilot will be required to resubmit a workover request each time he
performs a workover (continuous workover without a day off shall be considered a
single workover) if he desires additional workover.

The parties also agree for Air Evac, Cleveland EMS, Lexington EMS and Acadian
Ambulance EMS operations, under Article 24, that these operations shall be
considered one base for the determination and award of workover(s).




Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin






                                       70
<PAGE>   73

                             LETTER OF AGREEMENT #7



                                  JUL 12, 2001


Dear Captain Ragin:

Both parties recognize the likelihood of increased grievance activity during the
initial implementation of this Agreement and desire to avoid unnecessary added
costs and time commitments of the normal grievance procedure and System Board of
Adjustment during this time. Therefore, the parties agree under Article 36,
Grievance Procedure, that until the end of September 2001 (or at the end of
December 2001 if the parties agree as described below), grievances (except those
grievances as defined in Sections 3, 4, and 9) shall first be processed through
Section 2, Step 1. If the grievance is unresolved at that step (and for
grievances defined in Sections 3 and 4), the grievance will then be presented to
the Joint Implementation/ Resolution Committee ("Committee") in an attempt to
resolve the complaint as quickly and as fairly as possible. The Committee shall
review grievances only with a full and equal complement of standing members or
their designees from both the Employer and the Union, and shall respond in
writing to the grievance within thirty (30) days. If the Committee is unable to
resolve the grievance, the grievance may then proceed through the remaining
steps of the grievance procedure. Until the end of September 2001 (or at the end
of December 2001 if the parties agree as described below), the ten (10) calendar
day time requirement to proceed to Section 2, Step 3 shall begin after the
Committee has determined in writing that it is unable to resolve the grievance.

The parties agree that upon mutual written agreement, this Letter of Agreement
may be extended from the end of September 2001 until the end of December 2001.




Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin






                                       71
<PAGE>   74

                             LETTER OF AGREEMENT #8



                                  JULY 12, 2001


Dear Captain Ragin:

The parties agree under Article 40, Union Membership, Dues, Agency Fees &
Checkoff, that reference to "Authorization for Payroll Deduction" in Section 3
shall mean the Union's "Dues/Agency Fees Payroll Deduction Authorization" form.






Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin






                                       72
<PAGE>   75

                             LETTER OF AGREEMENT #9



                                  JULY 12, 2001


Dear Captain Ragin:

The parties agree to modify Article 28, Section 2, to provide that the
Employer's 401(k) Plan shall include pilots covered by this Agreement consistent
with the terms of that Plan. Should business conditions warrant, or if required
by law, the Employer reserves the right to separate the 401(k) Plan for pilots
covered by this Agreement from other Plan participants as originally provided
for under the Agreement, however the Employer agrees to discuss with the Union
any such change prior to implementation.






Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin






                                       73
<PAGE>   76

                             LETTER OF AGREEMENT #10



                                  JULY 12, 2001


Dear Captain Ragin:

Both parties recognize that in the Employer's IHTI operations, pilots have
cooperated in rotating their 14&14 work schedule each year such that the pilots
have every second year off-duty with their families for the Thanksgiving and
Christmas holidays. The parties agree that this practice may continue under
Article 10, Schedules of Service.





Very truly yours,                           Agreed:

/s/ Richard Rovinelli                       /s/ Stephen D. Ragin
------------------------------              --------------------------------
Richard Rovinelli                           Stephen D. Ragin






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