6-1162-JDR-396


Western Pacific Airlines, Inc.
2864 South Circle Drive
Suite 1100
Colorado Springs, CO  80906


Subject:          Letter Agreement No. 6-1162-JDR-396 to
                  Purchase Agreement No. 1947 -
                  Escalation Matters


This Letter Agreement  amends Purchase  Agreement No. 1947 dated as of even date
herewith (the Agreement) between The Boeing Company (Boeing) and Western Pacific
Airlines, Inc. (Buyer) relating to Model 737-300 aircraft (the Aircraft).

All terms used herein and in the Agreement,  and not defined  herein,  will have
the same meaning as in the Agreement.

1.       Commitment.

         Boeing agrees to share [XXXXXXX] of  the  escalation up to a maximum of
[X] percent per year in each of the years [XX] and [XX], as more fully described
in paragraph 2 below, for any of Buyer's aircraft which are scheduled to deliver
after December 31, 1996. For the purpose of this Letter  Agreement such aircraft
are referred to as "Eligible Aircraft."

All  escalation  calculations  under  this  Letter  Agreement  will  be  made in
accordance  with Exhibit D to the Agreement  entitled  "Price  Adjustment Due to
Economic  Fluctuations - Aircraft Price Adjustment"  (hereinafter referred to as
"Exhibit D"),  using actual  escalation  indices  published  for the  applicable
period.

2.       Escalation Credit Memo.

         2.1      Calculation - Eligible Aircraft Delivering in 1997.

                  At the time of delivery of each Eligible  Aircraft  delivering
in  1997,  Boeing  will  issue to Buyer a credit  memorandum  (the  1997  Credit
Memorandum)  which shall be applied to the Purchase Price of such Aircraft.  The
1997 Credit Memorandum shall be calculated as follows:

                  [XXXXXX] of the  difference  between the  Aircraft  escalation
                  calculated for a December [XX] aircraft delivery position, and
                  the  escalation  calculated  for the month of  delivery of the
                  [XX] Eligible Aircraft;

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                  provided however,

                  The  maximum  amount of the [XX] Credit  Memorandum  shall not
                  exceed [X] percent pursuant to the following calculation:

                           At the  time of the  delivery  of the  1997  Eligible
                           Aircraft,  the Aircraft Basic Price will be escalated
                           to a December 1996 delivery month.  The December 1996
                           escalated  price will be referred to in the following
                           formula as the "December 1996 Index Amount." The [XX]
                           Credit Memorandum for the [XX] Eligible Aircraft will
                           not exceed an amount equal to:

                           the December 1996 Index Amount times [XX].

         2.2      Calculation - Eligible Aircraft Delivering in 1998.

                  At the time of delivery of each Eligible  Aircraft  delivering
in  [XX],  Boeing  will  issue to Buyer a credit  memorandum  (the  [XX]  Credit
Memorandum)  which shall be applied to the Purchase Price of such Aircraft.  The
[XX] Credit Memorandum shall be calculated as follows:

                  (i) [XXXXXX] of the difference between the Aircraft escalation
                  calculated for a December [XX] aircraft delivery position, and
                  the  escalation  calculated  for the month of  delivery of the
                  [XX] Eligible Aircraft;

                  provided however,

                  The  maximum  amount of the [XX] Credit  Memorandum  shall not
                  exceed [X] percent pursuant to the following calculation:

                           At the  time of the  delivery  of the  1998  Eligible
                           Aircraft,  the Aircraft Basic Price will be escalated
                           to a December 1997 delivery month.  The December 1997
                           escalated  price will be referred to in the following
                           formula as the "December [XX] Index Amount." The [XX]
                           Credit Memorandum for the [XX] Eligible Aircraft will
                           not exceed an amount equal to:

                           the December 1997 Index Amount times [XX];

                  and,

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Western Pacific Airlines, Inc.
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                  (ii) The amount calculated above in paragraph 2.1 for the 1997
                  Credit Memorandum calculated through December, 1997.

         2.3      Eligible Aircraft Delivering after 1998.

                  For Eligible Aircraft delivering after the calendar year 1998,
the amount of the Credit  Memorandum will be the amount  calculated  pursuant to
paragraph 2.2 above through December 1998. This credit memorandum amount will be
escalated from December 1998 to the month of delivery.

3.       Advance Payment Base Price.

         It is agreed that the  Advance  Payment  Base  Prices for the  Eligible
Aircraft set forth in Article 3.4 of the  Agreement  include an estimate for the
escalation sharing Credit Memorandum pursuant to this Letter Agreement.

4.       Escalating Credits (STE).

         It is agreed that the credit  memoranda  specified in Letter  Agreement
No.  6-1162-JDR-394  which  escalate  in  accordance  with  Exhibit  D,  will be
calculated  using  the  same  factors  used to  develop  the  adjusted  aircraft
escalation pursuant to this Letter Agreement.

5.       Confidentiality.

         Buyer  understands  that certain  commercial and financial  information
contained in this Letter  Agreement are  considered  by Boeing as  confidential.
Buyer  agrees  that it will  treat this  Letter  Agreement  and the  information
contained herein as confidential and will not, without the prior written consent
of Boeing, disclose this Letter Agreement or any information contained herein to
any other person or entity, except as provided in Letter Agreement 1947-1.

Very truly yours,

THE BOEING COMPANY


By

Its  Attorney-In-Fact


P.A. No. 1947
K/WPA



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Western Pacific Airlines, Inc.
6-1162-JDR-396   Page 4


ACCEPTED AND AGREED TO this

Date:                    , 1996


WESTERN PACIFIC AIRLINES, INC.



By
  --------------------------------
Its


P.A. No. 1947
K/WPA



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