Document:

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                                                                    EXHIBIT 10.7

                                                          CONFIDENTIAL TREATMENT
                                                  REQUESTED PURSUANT TO RULE 406

                                 CHAUTAUQUA JET
                                SERVICE AGREEMENT

                                     Between

                                   US AIRWAYS

                                       And

                                   CHAUTAUQUA

                                   Dated as of
                                 March 19, 1999

CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT OF 1933. THE OMITTED
MATERIALS HAVE BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.

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                                TABLE OF CONTENTS
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                                                                                                          PAGE
<S>             <C>                                                                                         <C>
ARTICLE 1       COMPLIANCE WITH REGULATIONS..................................................................3

ARTICLE 2       AIR TRANSPORTATION SERVICES TO BE PROVIDED BY CONTRACTOR.....................................4

     Section 2.1       Schedule Requirements.................................................................4

     Section 2.2       Left Intentionally Blank..............................................................4

     Section 2.3       Section 2.3 Technical Operations......................................................4

     Section 2.4       FAA Regulations.......................................................................5

     Section 2.5       Operating Procedures..................................................................5

     Section 2.6       Aircraft Registration.................................................................5

     Section 2.7       Chautauqua Responsibilities...........................................................6

     Section 2.8       Substitute Aircraft...................................................................6

ARTICLE 3       OPERATION UNDER THE "US AIRWAYS EXPRESS" NAME................................................7

     Section 3.1       Service Trademarks....................................................................7

     Section 3.2       Signage...............................................................................7

ARTICLE 4       US AIRWAYS' SUPPORT SERVICES AND FACILITIES..................................................8

     Section 4.1       Us Airways Services...................................................................8

     Section 4.2       Reservations..........................................................................8

     Section 4.3       Station Facilities And Ground Support Service.........................................9

     Section 4.4       Cargo, Company Materials ("Comat") And Mail Handling Services........................10

     Section 4.5       Terms Of Transportation, Sales And Promotion.........................................11

ARTICLE 5       PURCHASE OF AVAILABLE SEAT MILES ("ASMS")...................................................12

     Section 5.1       Pricing Model........................................................................12

     Section 5.2       Chautauqua Costs And Pass Through Costs..............................................12

     Section 5.3       Left Intentionally Blank.............................................................13

     Section 5.4       Base Compensation Rate...............................................................13

     Section 5.5       Profit...............................................................................14

     Section 5.6       Intentionally Left Blank.............................................................15

     Section 5.7       Left Intentionally Blank.............................................................15

     Section 5.8       Payments.............................................................................15

ARTICLE 6       LIABILITY, INDEMNIFICATION AND INSURANCE....................................................16
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                                TABLE OF CONTENTS
                                   (continued)

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                                                                                                          PAGE
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     Section 6.1       Chautauqua Is An Independent Contractor..............................................16

     Section 6.2       Liability And Indemnification........................................................17

     Section 6.3       Insurance Coverage...................................................................18

     Section 6.4       Cargo Liability Insurance............................................................22

ARTICLE 7       TERM AND TERMINATION........................................................................23

     Section 7.1       Effective Date And Term..............................................................23

     Section 7.2       Regulatory Changes...................................................................23

     Section 7.3       Termination..........................................................................24

     Section 7.4       Termination By Chautauqua............................................................25

     Section 7.5       Return Of Property...................................................................25

ARTICLE 8       PENALTIES FOR POOR PERFORMANCE..............................................................26

     Section 8.1       Performance Holdback.................................................................26

     Section 8.2       Performance Measures.................................................................26

     Section 8.3       Performance Incentive Payment........................................................27

     Section 8.4       Poor Performance Penalty Disputes....................................................27

ARTICLE 9       SERVICE MARK LICENSE FOR SERVICES PROVIDED PURSUANT TO This AGREEMENT.......................28

     Section 9.1       Grant Of License.....................................................................28

     Section 9.2       Terms And Conditions Governing Trademark License.....................................28

ARTICLE 10      FORCE MAJEURE...............................................................................30

     Section 10.1      Force Majeure........................................................................30

     Section 10.2      Resumption Of Service................................................................30

ARTICLE 11      NOTICES.....................................................................................31

ARTICLE 12      MAINTENANCE COST ADJUSTMENT.................................................................32

     Section 12.1      Maintenance Cost Risk Sharing........................................................32

     Section 12.2      Intentionally Deleted................................................................32

     Section 12.3      Maintenance Cost Summary.............................................................32

     Section 12.4      Maintenance Cost Disputes............................................................33
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                                TABLE OF CONTENTS
                                   (continued)

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ARTICLE 13      MISCELLANEOUS...............................................................................34

     Section 13.1      Entire Agreement.....................................................................34

     Section 13.2      Headings.............................................................................34

     Section 13.3      Severability.........................................................................34

     Section 13.4      Waiver...............................................................................34

     Section 13.5      Assignability........................................................................35

     Section 13.6      Governing Law........................................................................35

ARTICLE 14      CONFIDENTIALITY.............................................................................36

     Section 14.1      Confidentiality of Agreement.........................................................36

     Section 14.2      Confidential Information.............................................................37

     Section 14.3      Exclusions From Confidential Information.............................................37

     Section 14.4      Information Shared With Us Airways Group, Inc........................................38

     Section 14.5      Information Shared With Chautauqua...................................................38

     Section 14.6      Return Of Documents..................................................................38

     Section 14.7      Remedies.............................................................................39

ARTICLE 15      DISPUTE RESOLUTION..........................................................................40

     Section 15.1      Certain Disputes.....................................................................40

     Section 15.2      Dispute Resolution Proceedings.......................................................40
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                        CHAUTAUQUA JET SERVICE AGREEMENT

     This Agreement is made and entered as of this 19th day of March, 1999, by
and between US Airways, Inc., (herein referred to as "US Airways"), a Delaware
corporation having its principal place of business at 2345 Crystal Drive,
Arlington, Virginia 22227, and Chautauqua Airlines, Inc., (herein referred to as
"Chautauqua"), a New York corporation, having a principal place of business at
2500 S. High School Road, Indianapolis, Indiana 46251.

                                   WITNESSETH:

WHEREAS, US Airways holds a certificate of public convenience and necessity
issued by the Department of Transportation ("DOT") authorizing US Airways to
engage in the interstate and overseas air transportation of persons, property
and mail between all points in the United States, its territories and
possessions;

WHEREAS, Chautauqua engages in the interstate air transportation of persons,
property and mail in the United States pursuant to an exemption under 14 C.F.R
Part 298;

WHEREAS, US Airways owns various trademarks, service marks and logos, including
"US Airways," "US Airways Express," and distinctive exterior color decor and
patterns on its aircraft, hereinafter referred to individually and collectively
as the "US Airways servicemarks";

     WHEREAS, Chautauqua desires to operate regional jets as US Airways Express
air transportation services as provided in this Agreement and wishes to acquire
a nonexclusive license for use of one or more of US Airways' Servicemarks for
use in connection with Chautauqua's operation of such services;

WHEREAS, US Airways desires to contract for the operation of such regional jets
as scheduled air transportation services by Chautauqua and does hereby grant
Chautauqua the use of one or

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more of US Airways' Servicemarks in connection with Chautauqua's operation of
such services; and

WHEREAS, both parties desire that Chautauqua be compensated by US Airways for
operating such regional jets as air transportation services and that US Airways
assume certain of the business obligations associated with the marketing and
sale of such transportation services to the traveling public, in each case as
more particularly described herein;

NOW THEREFORE, for and in consideration of the foregoing premises and the mutual
covenants and obligations hereinafter set forth, the parties to this Agreement
hereby agree as follows:

                                       -2-
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ARTICLE 1   COMPLIANCE WITH REGULATIONS

Chautauqua hereby represents, warrants and agrees that all air transportation
services performed by it pursuant to this Agreement or otherwise shall be
conducted in full compliance with any and all applicable statutes, orders,
rules, and regulations, whether now in effect or hereafter promulgated, of all
governmental agencies having jurisdiction over Chautauqua's operations,
including, but not limited to the Federal Aviation Administration and the DOT
(for purposes of this Agreement, any applicable regulatory authority, whether
domestically or internationally, shall be referred to as the "FAA"). Chautauqua
hereby accepts the sole and exclusive responsibility for complying with such
governmental statutes, orders, rules, and regulations and the parties agree that
US Airways will have no obligations or responsibilities, whether direct or
indirect, with respect to such matters, except for sharing the costs associated
therewith as and to the extent provided herein.

                                       -3-
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ARTICLE 2   AIR TRANSPORTATION SERVICES TO BE PROVIDED BY CONTRACTOR

SECTION 2.1   SCHEDULE REQUIREMENTS

At all times during the term of this Agreement and any amendment or extension
thereof, Chautauqua will schedule and operate US Airways Express air
transportation service between various U.S. domestic city-pairs and between
various U.S - Canadian city-pairs selected in accordance with the immediately
succeeding sentence (hereinafter referred to as the "Service") using ten (10)
EMB-145 LR fifty (50) seat jet aircraft or such other aircraft as may be
substituted therefore pursuant to the terms hereof (hereinafter referred to as
the "Aircraft"), based on the implementation schedule set forth in Exhibit 2.1,
attached hereto and made a part hereof. The city-pairs from which the air
transportation services are to be provided by Chautauqua pursuant to this
Agreement will be selected by US Airways, in its sole discretion, subject only
to operations and safety requirements, minimum and maximum schedule
requirements, and the other parameters set forth in Exhibit 2.1(a). US Airways
may, on sixty (60) days advance written notice to Chautauqua, designate changes
in the following: city-pairs served, aircraft routings or flight frequencies,
provided that the new city-pairs, aircraft routings, and flight frequencies
continue to satisfy the parameters set forth in Exhibit 2.1(a).

SECTION 2.2   LEFT INTENTIONALLY BLANK

SECTION 2.3   SECTION 2.3 TECHNICAL OPERATIONS

During the term of this Agreement, Chautauqua will be responsible for the
technical operation of the Aircraft and the safe performance of the flights in
accordance with all applicable law (such law of any jurisdiction having
authority, the "FAA Regulations'). Chautauqua shall retain full authority,
operational control and possession of the Aircraft to enable it to do so. In
particular,

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Chautauqua or its agents or employees will, for the purpose of the safe
performance of such flights, have absolute discretion in all matters concerning
the preparation of the Aircraft for flight, the flight, the load carried and its
distribution in so far as such matters affect the safety of the Aircraft, the
decision whether or not such flight shall be undertaken, and all other matters
relating to the technical operation of the Aircraft. Chautauqua will be solely
responsible for, and US Airways will have no obligations or duties with respect
to the dispatch of Chautauqua's flights operated pursuant to this Agreement or
otherwise. For the purpose of this Section 2.3, the, term flight dispatch will
include, but will not be limited to, all planning of flight itineraries and
flight paths, fueling and flight release.

SECTION 2.4   FAA REGULATIONS

The operation of the Aircraft shall be carried out in accordance with the FAA
Regulations and the approved standards and practices of Chautauqua thereunder.

SECTION 2.5   OPERATING PROCEDURES

Chautauqua will furnish to US Airways a copy of relevant operating
specifications, operational regulations, manuals and calculations in respect of
the Aircraft and will also furnish to US Airways a copy of all flight statistics
in respect of the flights operated.

SECTION 2.6   AIRCRAFT REGISTRATION

During the term of this Agreement, the Aircraft will remain registered in the
United States of America in accordance with the FAA Regulations.

                                       -5-
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SECTION 2.7   CHAUTAUQUA RESPONSIBILITIES

Chautauqua will be responsible for providing, at its own cost, in connection
with the Services provided under this Agreement, all services and materials
identified under the heading "To Chautauqua" in Exhibit 2.8, attached hereto and
made a part hereof (collectively, the "Chautauqua Services").

SECTION 2.8   SUBSTITUTE AIRCRAFT

In addition to the Aircraft described in Section 2.1, Chautauqua may arrange
for, and may have substitute aircraft as may be required to maintain effectively
the seat miles which US Airways will purchase under this Agreement, during
periods when Chautauqua's primary aircraft may be out of service due to
unforeseen and irregular maintenance requirements. Chautauqua may substitute a
cabin class aircraft (including, without limitation, a SAAB 340-A aircraft), in
US Airways Express livery or another aircraft. In the case of another aircraft,
US Airways' prior approval shall be required, but such approval not be
unreasonably withheld or delayed. In such event, Chautauqua will be paid as
follows with respect to the SAAB 340-A aircraft: [*]completed by such substitute
aircraft. In addition, Chautauqua will be paid for the ASMs flown by such
substituted aircraft in the same manner that it is paid for ASMs flown by the
Aircraft. For all other Chautauqua Services involving substitute aircraft,
Chautauqua will be compensated in accordance with specific rates mutually agreed
upon between Chautauqua and US Airways. If a substitute aircraft is to be
utilized for more than a two (2) day period, Chautauqua and US Airways will
mutually agree upon the route that will be covered by the substitute aircraft.

                                       -6-

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ARTICLE 3   OPERATION UNDER THE "US AIRWAYS EXPRESS" NAME

SECTION 3.1   SERVICE TRADEMARKS

The Aircraft utilized by Chautauqua pursuant to this Agreement will bear US
Airways Servicemarks, presently consisting of the red, white, gray and blue
aircraft exterior color decor and pattern provided by US Airways and the name
"US Airways Express." At any time during the term of this Agreement, and at the
sole discretion of US Airways, Chautauqua shall use such new or different
servicemarks and exterior color decor and patterns on its Aircraft as US Airways
may determine. Interior color schemes must also be approved by US Airways. Upon
written notice from US Airways, which will include the specifications for any
such changes in servicemarks and/or exterior aircraft decor and patterns,
Chautauqua will effect such changes as promptly as is reasonably practicable.
Chautauqua will not be required to implement changes in the exterior color decor
and pattern more than once in any consecutive three-year period. Any
out-of-pocket expenses to repaint or to redecorate the Aircraft or reconfigure
or redecorate the interior of the Aircraft as a result of changes required by US
Airways, other than routine maintenance, shall be paid for by US Airways.

SECTION 3.2   SIGNAGE

In addition to use of the US Airways Servicemarks on the Aircraft, Chautauqua
will use and display suitable signs on the interior and exterior of the Aircraft
identifying Chautauqua as the operator of the services being provided pursuant
to this Agreement. The location of the signs will be subject to the prior
written approval, such approval not to be unreasonably withheld or delayed, of
US Airways as to nature, size and location on Chautauqua's Aircraft provided
that the signs will satisfy the FAA Regulations.

                                       -7-
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ARTICLE 4   US AIRWAYS' SUPPORT SERVICES AND FACILITIES

SECTION 4.1   US AIRWAYS SERVICES

US Airways and/or third party providers, at the discretion of US Airways, will
provide at US Airways' cost and expense, marketing, reservations, ground support
services, station facilities, and cargo and mail handling services, to the
extent and in the manner set forth in the subsequent sections of this Article 4
(collectively, and together with the responsibilities of US Airways under
Exhibit 2.8 hereof, the "US Airways Services"). Such services and facilities
will be furnished only with respect to Chautauqua's Services offered under this
Agreement.

SECTION 4.2   RESERVATIONS

(a) All reservations will be requested and confirmed for passengers using the
Aircraft operated by Chautauqua under this Agreement through US Airways'
internal reservations services. Connecting reservations to US Airways or to
other air carriers will be requested and confirmed through US Airways' internal
reservations system in accordance with currently established methods and
procedures utilized by US Airways for its passengers. For passengers originating
their travel at points other than those served by Chautauqua under this
Agreement, either on US Airways' internal reservations system or on the
reservations systems of other airlines, connecting reservations to the services
of Chautauqua will also be made in accordance with currently established methods
and procedures utilized by US Airways for its passengers. In all cases, US
Airways will confirm the reservations of Chautauqua's passengers through the
entire itinerary of their scheduled trips. When a contact number is supplied by
the passengers making such reservations, US Airways will assume the
responsibility of notifying passengers of any changes in Chautauqua's schedules
or operations, provided that Chautauqua furnishes US Airways with sufficient
advance notice of such changes.

(b) In the event of flight delays, cancellations or other schedule
irregularities affecting Chautauqua's scheduled services, and as soon as
information concerning such irregularities is

                                       -8-
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available, Chautauqua will notify US Airways' reservations control center in a
manner prescribed by US Airways and furnish such information in as much detail
as is reasonably practicable. All schedule changes and passenger
re-accommodations for Chautauqua passengers will be performed in the same manner
as they would for US Airways passengers.

(c) From time to time, and solely upon the request of Chautauqua or its flight
crews, US Airways may furnish Chautauqua's flight crew with such U.S. weather
bureau information or data as may be available to US Airways; provided, that in
furnishing any such weather information or data to Chautauqua, neither US
Airways nor its employees or agents will be responsible or liable for the
accuracy thereof.

SECTION 4.3   STATION FACILITIES AND GROUND SUPPORT SERVICE

US Airways and/or third patty providers, at the discretion of US Airways, will
provide, at US Airways' cost and expense, the following services at locations
where Chautauqua provides air transportation services pursuant to this
Agreement:

         (a) check-in and ticketing of passengers [*];
         (b) use of US Airways' passenger facilities [*];
         (c) [*];
         (d) [*];
         (e) [*];
         (f) [*];
         (g) [*]; and
         (h) [*].

SECTION 4.4   CARGO, COMPANY MATERIALS ("COMAT") AND MAIL HANDLING SERVICES

(a) US Airways' personnel and/or third party personnel, at the discretion of US
Airways, will process appropriate tickets and/or bills of lading and US Airways
airbills, accept for

                                       -9-

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transportation, and will load on the regularly scheduled air transportation
Services operated by Chautauqua under this Agreement, such cargo and U. S. mail
as will be tendered to it by the United States Postal Service ("USPS") and by
cargo customers, provided that no Hazardous Materials may be accepted and
transported on Chautauqua Aircraft, except as permitted by the Department of
Transportation pursuant to regulations contained in 49 C.F.R. Parts 171 through
180.

(b) US Airways will observe and comply with all applicable regulations,
instructions and procedures with respect to mail, CoMat and cargo packages.

(c) Subject to subpart (b) of Section 4.4, above, US Airways will process any
Chautauqua CoMat that Chautauqua may desire to send on Chautauqua Aircraft.

(d) Chautauqua personnel will comply with US Airways' applicable instructions
and procedures with respect to CoMat packages tendered to US Airways pursuant to
this Agreement.

SECTION 4.5   TERMS OF TRANSPORTATION, SALES AND PROMOTION

(a) US Airways' Terms of Transportation, with certain exceptions listed therein,
including procedures with respect to schedule change and passenger
re-accommodation procedures, will be applicable to Chautauqua Services provided
pursuant to this Agreement. Such Terms of Transportation will at all times be
available for public inspection at Chautauqua's corporate offices and at each
airport ticket counter and sales office maintained and operated by US Airways in
connection with the Services provided under this Agreement.

(b) All tickets issued for air passenger transportation, and all bills of
lading, US Airways airbills and invoices issued for U. S. mail and cargo
shipments, provided on the Service offered under this Agreement, will bear the
"US Airways" airline designator code.

(c) US Airways is responsible for [*].

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(d) US Airways will include the scheduled air services provided by Chautauqua
pursuant to Article 2 of this Agreement in its public timetables (including
Chautauqua's connecting schedules on the same basis as it does its own), if
published. All references in US Airways' public timetables to Chautauqua's US
Airways Express services will also contain notations indicating that such
scheduled services are performed by Chautauqua as an independent contractor
under the appropriate US Airways Servicemarks and will comply with all
regulatory disclosure requirements.

                                      -11-
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ARTICLE 5   PURCHASE OF AVAILABLE SEAT MILES ("ASMS")

SECTION 5.1   PRICING MODEL

US Airways and Chautauqua have developed a certain model, hereinafter referred
to as "the Pricing Model" and set forth in Exhibit 5.1, which will be used to
determine the compensation to be paid by US Airways for city-pairs flown by
Chautauqua pursuant to this Agreement.

SECTION 5.2   CHAUTAUQUA COSTS AND PASS THROUGH COSTS

The Pricing Model, which will be used to compensate Chautauqua, divides
compensation into two categories, (1) "Chautauqua Costs" and (2) "Pass Through
Costs."

(a) Chautauqua will be reimbursed for "Chautauqua Costs" according to the rates
set forth in Exhibit 5.1 based upon the following:

     (i) with respect to the Per Aircraft costs set forth therein, the number of
     Aircraft in Chautauqua's fleet that have been placed into service for US
     Airways Express operation under this Agreement;

     (ii) with respect to the Per Block Hour costs set forth therein, the Block
     Hours for flights actually flown by the Aircraft;

     (iii) with respect to the Per Flight Hour costs set forth therein, the
     number of Flight Hours actually flown by the Aircraft;

     (iv) with respect to the Per Departure costs set forth therein, the number
     of actual departures; and

     (v) with respect to the Fixed Costs set forth therein, the amount of such
     fixed costs. After [*] of the implementation of Service with the
     [*]Aircraft under this Agreement, and every [*] thereafter, the parties
     will review in good faith the [*]. To the extent that the [*] is not on
     average, equal to [*] and such [*] is not attributable to [*], the Per
     Block Hour Cost set forth in Exhibit 5.1 shall be adjusted to reflect the
     actual [*] and the resultant [*]

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     required by Chautauqua. Any disputes relating to an adjustment of the Per
     Block Hour Costs in Exhibit 5.1 shall be resolved in accordance with the
     dispute resolution procedure set forth in Article 15.

(b) Each cost component will be adjusted annually at the beginning of each
calendar year within the Term of this Agreement based upon the escalation factor
set forth in Exhibit 5.1, except that with respect to [*] such escalation will
take effect at the time of the increases provided for [*], currently [*], and
currently [*].

(c) Chautauqua will be reimbursed for "Pass Through Costs" based upon the actual
costs incurred by Chautauqua.

SECTION 5.3   LEFT INTENTIONALLY BLANK

SECTION 5.4   BASE COMPENSATION RATE

(a) US Airways will pay Chautauqua on the first day of each month an amount
based upon the Pricing Model's estimated figures, such amount being referred to
as the Base Compensation Rate less an amount equal to [*]. US Airways will place
the amount held back in a separate account hereinafter referred to as the
"Incentive Fund."

(b) After the end of the month, US Airways will pay Chautauqua an amount based
upon the Pricing Model's figures using actual statistics and replacing the
model's Pass Through Costs with actual amounts as discussed in Section 5.2 less
the amount equal to [*] less the estimated amount paid by US Airways on the
first day of the month per Section 5.4 (a). If it is determined that US Airways'
estimated payment is more than the amount calculated after the end of the month,
Chautauqua will be required to refund the overpayment amount promptly.

(c) At the end of the month, a payment from the Incentive Fund (hereinafter
"Incentive Payment"), if any, will be made to Chautauqua as described in Section
8.3.

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(d) Notwithstanding the provisions set forth in this Article 5, in the event
that Chautauqua is unable to provide the Chautauqua Services due to the
grounding of the Aircraft as a result of a defect in the design or manufacture
of the Aircraft or as a result of a strike by employees of Chautauqua, US
Airways shall only be responsible for payment of Chautauqua's Fixed Costs and
Per Aircraft costs as set forth in Exhibit 5.1 during such period for [*] days.
In the event that Chautauqua is unable to provide the Chautauqua Services as a
result of Chautauqua's failure to properly maintain the Aircraft, or to
otherwise comply with FAA Regulations associated with the maintenance and/or
operation of the Aircraft, US Airways payment obligation shall be fully
suspended during such time period. In the event Chautauqua is unable to provide
the Chautauqua Services as a result of any other reason, including without
limitation, due to a US Airways strike, US Airways shall pay Chautauqua its
Fixed Costs and Per Aircraft Costs as set forth in Exhibit 5.1 plus its Profit
(as defined in Section 5.5 below) for such period based on the minimum number of
ASM's guaranteed under this Agreement for each day during such period.

SECTION 5.5   PROFIT

In addition to the cost reimbursement set forth in Section 5.2 above, US Airways
will pay Chautauqua monthly in arrears a "Profit" of [*] per actual Available
Seat Mile (ASM) flown during the month provided that, if during the course of
any year during the term of this Agreement, the actual number of ASMs flown is
less than [*], Chautauqua will be paid a Profit for the lesser of (a) [*], and
(b) [*]. The Profit will be escalated [*], beginning in the [*] year of this
Agreement, and

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thereafter, by [*].

SECTION 5.6   INTENTIONALLY LEFT BLANK

SECTION 5.7   LEFT INTENTIONALLY BLANK

SECTION 5.8   PAYMENTS

All payments due under this Article will be paid directly to Chautauqua, or US
Airways, as the case may be, within ten (10) business days of the calculation of
any payment that is due under this Agreement, except as provided in Section
5.4(a).

                                      -15-

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ARTICLE 6   LIABILITY, INDEMNIFICATION AND INSURANCE

SECTION 6.1   CHAUTAUQUA IS AN INDEPENDENT CONTRACTOR

(a) The employees, agents, and/or independent contractors of Chautauqua engaged
in performing any of the services Chautauqua is to perform pursuant to this
Agreement will be employees, agents, and independent contractors of Chautauqua
for all purposes, and under no circumstances will be deemed to be employees,
agents or independent contractors of US Airways. 1n its performance under this
Agreement, Chautauqua will act, for all purposes, as an independent contractor
and not as an agent for US Airways. US Airways will have no supervisory power or
control over any employees, agents or independent contractors engaged by
Chautauqua in connection with its performance hereunder, and all complaints or
requested changes in procedures will, in all events, be transmitted by US
Airways to a designated officer of Chautauqua. Nothing contained in this
Agreement is intended to limit or condition Chautauqua's control over its
operations or the conduct of its business as an air carrier, and Chautauqua and
its principals assume all risks of financial losses which may result from the
operation of the air transportation services to be provided by Chautauqua
hereunder.

(b) The employees, agents, and/or independent contractors of US Airways engaged
in performing any of the services US Airways is to perform pursuant to this
Agreement will be employees, agents, and/or independent contractors of US
Airways for all purposes, and under no circumstance will they be deemed to be
employees, agents, and/or independent contractors of Chautauqua. Chautauqua will
have no supervision or control over any such US Airways employees, agents,
and/or independent contractors and any complaint or requested change in
procedure will be transmitted by Chautauqua to US Airways' designated
representative.

                                      -16-
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SECTION 6.2   LIABILITY AND INDEMNIFICATION

(a) Each party hereto assumes full responsibility for any and all liability to
its own directors, officers, employees, or agents arising from injury, or death
resulting from or sustained in the performance of its respective services under
this Agreement. (b) Chautauqua will indemnify, defend, protect, save, and hold
harmless US

Airways, its directors, officers, employees, and agents from and against any and
all liabilities, claims, demands, suits, judgments, damages, and losses
(including the reasonable costs, fees, and expenses in connection therewith and
incident thereto), brought against US Airways, its directors, officers,
employees or agents by or on behalf of any director, officers, employee, agent
or independent contractor of Chautauqua or anyone else claiming through such
persons, or by reason of damage or destruction of property of any such person,
or injury to or death of such person, caused by or arising out of any act or
omission of Chautauqua (collectively "Chautauqua Claims") occurring during the
term of this Agreement except for claims based on matters for which US Airways
is responsible under the terms of this Agreement or claims arising solely from
the gross negligence or willful misconduct of US Airways. US Airways will give
Chautauqua prompt and timely written notice of any claim made or suit instituted
against US Airways which in any way results in indemnification hereunder, and
Chautauqua will have the right to compromise or participate in the defense of
same to the extent of its own interest, including the selection of counsel to
represent its interest in the matter.

(c) Each party, with respect to its own employees, accepts full and exclusive
liability for the payment of worker's compensation and/or employer's liability
insurance premiums with respect to such employees, and for the payment of all
taxes, contributions or other payments for unemployment compensation or
retirement benefits, pensions or annuities now or hereafter imposed upon
employers by the government of the United States or by any state or local
governmental body with respect to such employees measured by the wages,
salaries, compensation or other remuneration paid to such employees, or
otherwise, and each party further agrees to made such payments and to make and
file all reports and returns, and to do everything necessary to comply with the
laws imposing such taxes, contributions or other payments.

                                      -17-
<Page>

(d) US Airways will indemnify, defend, protect, save, and hold harmless
Chautauqua, its directors, officers, employees, and agents from and against any
and all reasonable liabilities, claims, demands, suits, judgments, damages, and
losses (including all reasonable costs, fees and expenses in connection
therewith or incident thereto), brought against Chautauqua, its directors,
officers, employees or agents by or on behalf of any director, officer,
employee, agent or independent contractor of US Airways or anyone else claiming
through such persons, or by reason of damage or destruction of property of any
such person, or injury to or death of such person, caused by or arising out of
any act or omission of US Airways (collectively "US Airways Claims") occurring
during the term of this Agreement except for claims based on matters for which
Chautauqua is responsible under the terms of this Agreement or claims arising
solely from the gross negligence or willful misconduct of Chautauqua. Chautauqua
will give US Airways prompt and timely notice of any claim made or suit
instituted against Chautauqua which in any way results in indemnification
hereunder, and US Airways will have the right to compromise or participate in
the defense of same to the extent of its own interest, including the selection
of counsel to represent its interest in the matter.

SECTION 6.3   INSURANCE COVERAGE

(a) Chautauqua will, at all times during the effectiveness of this Agreement,
have and maintain in full force and effect, policies of insurance satisfactory
to US Airways, of the types of coverage, and in the minimum amounts stated below
with companies reasonably satisfactory to US Airways and under terms and
conditions reasonably satisfactory to US Airways, including coverage on all
Aircraft from which Chautauqua Services are to be provided pursuant to this
Agreement. Unless otherwise specified, the minimum amounts of insurance coverage
required under this paragraph will be [*] combined single limit for all coverage
required under this paragraph.

                                      -18-

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                                            Minimum Amount of Insurance Coverage
       Type of Insurance Coverage             (U.S. Currency - Per Occurrence)
----------------------------------------    ------------------------------------
1. Comprehensive Airline Liability
    Insurance (including Premises
    Liability Products and Completed
    Operations Liability Insurance)

     a. Bodily Injury - Passengers and
         Non-Passengers                             $[*] Each Occurrence

     b. Personal Injury - Passengers                $[*] Each Occurrence

     c. Personal Injury - Non-Passengers            $[*] Each Occurrence

     d. Property Damage                             $[*] Each Occurrence

2. Worker's Compensation Insurance                          [*]
    (Chautauqua's Employees)

3. Employer's Liability                                    $[*]
    (Chautauqua's Employees)

4. All Risk Hull and Aviation Hull War       [*] or such lesser amount as may be
    and Associated Perils (or equivalent)         consented to by US Airways
    insurance on Aircraft performing
    Chautauqua services hereunder

(b) The parties hereby agree that from time to time during the life of this
Agreement, US Airways may require Chautauqua to have and maintain amounts
different from those set forth in paragraph (a) above, should the circumstances
and conditions of Chautauqua's operations under this Agreement be deemed in US
Airways' reasonable judgment, to require reasonable increases in any or all of
the foregoing minimum insurance coverage.

(c) Chautauqua agrees, in addition, that all policies of insurance which it
maintains pursuant to this Agreement, will:

                                      -19-

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     (i) provide that any waiver of rights of subrogation against other parties
     by Chautauqua will not affect the coverage provided hereunder with respect
     to US Airways;
     (ii) with respect to the Services performed by the parties pursuant to this
     Agreement, provide that Chautauqua's underwriters will waive any and all
     subrogation rights against US Airways, its directors, officers, agents and
     employees, except for claims based solely upon the gross negligence or
     willful misconduct of US Airways or any such person; and
     (iii) be duly and properly endorsed to provide that each such policy or
     policies or any part or parts thereof will not be canceled, terminated, or
     materially altered, changed or amended by Chautauqua's insurance
     underwriters, until after [*] or such lesser period as may from time to
     time be applicable in the case of any war and allied/associated hull
     coverage) written notice to US Airways which [*] written notice will
     commence to run from the date such notice is mailed via reputable overnight
     carrier to the attention of US Airways.

(d) With respect to policies of insurance described in subsection numbered 1 of
Section 6.3 (a) of this Agreement, Chautauqua will provide that such policies:
     (i) endorse US Airways, its directors, officers, agents, and employees as
     Additional lnsureds thereunder;
     (ii) constitute primary insurance for such claims and acknowledge that any
     other insurance policy or policies of US Airways will be secondary or
     excess insurance;
     (iii) cover US Airways' [*]; and
     (iv) provide [*] clauses acceptable to US Airways, and a specific
     contractual liability insurance provision covering liability assumed by
     Chautauqua under this Agreement.

(e) With respect to policies of insurance for coverage described in subsections
1 and 4 of Section 6.3(a) of this Agreement, a breach of warranty clause
reasonably acceptable to US Airways must be provided by Chautauqua's insurers.

(f) All aircraft hull insurance provided pursuant to subsection 4 of Section
6.3(a) of this Agreement will be provided on an agreed value basis, and, except
with the consent of

                                      -20-

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US Airways, will not be subject to more than the standard market deductibles, as
certified by a recognized broker in the event of loss, settled on the basis of a
total loss, all losses will be payable in full.

(g) In the event that any of Chautauqua's insurance policies under this
Agreement are obtained directly from foreign underwriters, US Airways must be
allowed to maintain against such foreign underwriters, a direct action in the
United States upon said insurance policies and to provide for service of process
to an attorney located within the United States, who maintains an office in
Washington, D. C., or New York, New York. (h) Upon the effective date of this
Agreement, and from time to time thereafter upon request by US Airways,
Chautauqua will furnish to US Airways certificates of insurance satisfactory to
US Airways of the aforesaid insurance coverage, limits and endorsements. In
addition to the certificates of insurance, Chautauqua's insurance broker will
provide their written opinion that the policy or policies of insurance carried
by Chautauqua are in full compliance with all of the insurance requirements set
forth herein and are in full force and effect. Initially, this evidence will be
provided by certified copies of the policies required hereunder. In the event of
a change of broker by Chautauqua, such certificates will be supplied to US
Airways from broker reasonably satisfactory to US Airways.

(i) In the event Chautauqua fails to maintain in full force and effect any of
the insurance and endorsements described in this Section 6.3, US Airways will
have the right (but not the obligation) to procure and maintain such insurance
or any part thereof. The cost of such insurance will be payable by Chautauqua to
US Airways upon demand by US Airways. The procurement of such insurance or any
part thereof by US Airways does not discharge or excuse Chautauqua's obligation
to comply with the provisions of this Section. Chautauqua agrees not to cancel,
terminate or materially alter, change or amend any of the policies referred to
in this Section until after providing [*] advance written notice to US Airways,
of its intent to so cancel, terminate or materially alter, change or amend said
policies or insurance, which [*] notice period will commence to run from the
date notice is mailed via reputable overnight carrier to the attention of US
Airways.

                                      -21-

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SECTION 6.4   CARGO LIABILITY INSURANCE

US Airways will maintain cargo liability insurance coverage, in types and
amounts required by law, for all air freight transported by Chautauqua under a
US Airways airbill on flights operated pursuant to the Services provided by
Chautauqua under this Agreement.

                                      -22-
<Page>

ARTICLE 7   TERM AND TERMINATION

SECTION 7.1   EFFECTIVE DATE AND TERM

This Agreement is effective as of the date and year first written above, and
Services provided hereunder will continue, without interruption, for a period of
seven (7) years from the implementation date of the first Aircraft, unless it is
terminated on an earlier date pursuant to the provisions of this Article 7. US
Airways, at its sole option, may extend the agreement by three (3) years with
written notification any time up to twelve (12) months before the end of the
first seven (7) year term.

SECTION 7.2   REGULATORY CHANGES

In the event of any change in the statutes and/or regulations governing the
provision of the Services to be provided pursuant to this Agreement that
materially and adversely affects the economic value of this Agreement, taken as
a whole, to either US Airways or Chautauqua, or both, then the parties hereto
will consult within thirty (30) days after any of the occurrences described
herein in order to determine what, if any, changes to this Agreement are
necessary or appropriate to preserve the essence of the Agreement. If the
parties hereto are unable to agree whether any change or changes to this
Agreement are necessary and proper, or as to the terms of such change or
changes, or whether this Agreement should be canceled in light of the
occurrences as described above, and such failure to reach agreement will
continue for a period of thirty (30) days following the commencement of the
consultations provided for by this Section 7.2, then this Agreement may be
canceled by the party materially and adversely affected in such manner upon by
providing the other party a minimum of ninety (90) days written notice of such
cancellation

                                      -23-
<Page>

SECTION 7.3   TERMINATION

US Airways may terminate this Agreement, for cause, upon not less than ninety
(90) days written notice to Chautauqua, should any of the following conditions
set forth in subparts (a) through (d) of this Section 7.3 occur during the term
of this Agreement, subject to Chautauqua's right to cure such condition as set
forth herein. After notice of termination is given, US Airways will meet with
Chautauqua for the purpose of resolving the conditions so occurring. Should such
conditions not be corrected within ninety (90) days (or action taken to begin
correcting the problem if correction cannot be completed within ninety (90)
days), then the termination is effective. If the conditions are corrected (or
all steps to remedy the situation were promptly taken if the correction cannot
be completed reasonably within ninety (90) days), the termination notice shall
be deemed rescinded. The conditions arc:
     (a) If Chautauqua fails to retain and/or utilize the Aircraft in the manner
     required in Article 2, except as otherwise provided herein; or
     (b) If, after Chautauqua's introduction of services hereunder with the [*]
     Aircraft, Chautauqua's flight completion factor falls below the following
     standard due to [*] operational deficiencies that are within the
     responsibility of Chautauqua under thus Agreement:
          [*] for any [*] consecutive months, or
          [*] for any [*] consecutive months, or
     (c) If, after Chautauqua's introduction of services hereunder with the [*]
     Aircraft, Chautauqua's departure performance as measured in Section 8.2 of
     this Agreement falls below either of the following:
          [*] for any [*] months, or
          [*] for any [*] months; or
     (d) If Chautauqua admits liability or is found liable for safety
     infractions (other than routine ministerial fines) by the Federal Aviation
     Administration which could reasonably be expected to lead to the suspension
     or revocation of Chautauqua's operating certificate, or in US Airways'
     reasonable opinion, is not complying in any material respect with
     applicable safety and operational requirements.

                                      -24-

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SECTION 7.4   TERMINATION BY CHAUTAUQUA

Chautauqua shall have the right to terminate this Agreement on ninety (90) days
prior written notice to US Airways in the event US Airways terminates the
Chautauqua Service Agreement dated as of February 9, 1994, as amended.

SECTION 7.5   RETURN OF PROPERTY

Upon final termination of this Agreement, each party will, as soon as
practicable, return any and all property of the other party to such other party.

                                      -25-
<Page>

ARTICLE 8   PENALTIES FOR POOR PERFORMANCE

SECTION 8.1   PERFORMANCE HOLDBACK

Following Chautauqua's introduction of Services hereunder with the [*] Aircraft,
US Airways will withhold [*] from the estimated monthly advance payment due
under Section 5.4 ("Holdback"). This Holdback will be paid to Chautauqua based
upon Chautauqua's operating performance in accordance with the terms of this
Article 8.

SECTION 8.2   PERFORMANCE MEASURES

Chautauqua's operating performance will be measured each month following
Chautauqua's introduction of services hereunder with the [*] Aircraft, based
upon the following metrics:

     (a) The percentage of departures completed within [*] of scheduled
     departure time based on departures made within Aircraft turn times
     excluding [*] will be measured. Chautauqua will be awarded [*] for every
     day that more than [*] of scheduled departures meet goal.

     (b) The percentage of scheduled departures completed excluding [*] will be
     measured. Chautauqua will earn [*] for every day that Chautauqua completes
     more than [*] of scheduled departures.

     (c) Passenger complaints received for [*] will be tracked by US Airways.
     [*] will be awarded in any month where complaints received per one hundred
     thousand (100,000) passengers carried under the terms of this Agreement are
     less than [*].

SECTION 8.3   PERFORMANCE INCENTIVE PAYMENT

                                      -26-

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At the end of each month, US Airways will compute the total number [*] earned by
Chautauqua and provide a summary statement summarizing the overall performance
[*] earned by Chautauqua during the preceding month. US Airways will pay a
performance incentive for the previous month based upon the following table:

     [*]                                           [*]
     [*]                                           [*]
     [*]                                           [*]
     [*]                                           [*]

SECTION 8.4   POOR PERFORMANCE PENALTY DISPUTES

Any disputes between US Airways and Chautauqua arising as a result of Penalties
for Poor Performance will be resolved in accordance with the dispute resolution
procedures set forth in Article 15.

                                      -27-

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ARTICLE 9   SERVICE MARK LICENSE FOR SERVICES PROVIDED PURSUANT TO THIS
            AGREEMENT

SECTION 9.1   GRANT OF LICENSE

US Airways hereby grants to Chautauqua a nonexclusive, nontransferable license
to use such US Airways Servicemarks as US Airways may designate from
time-to-time in connection with the services to be rendered by Chautauqua under
this Agreement; PROVIDED, HOWEVER, that at any time during the term of this
Agreement, US Airways may alter, amend or revoke the license hereby granted and
require at US Airways' expense, if directed by US Airways, Chautauqua's use of
any new or different US Airways Servicemarks in conjunction with the air
transportation services provided hereunder as US Airways may determine in the
exercise of its sole discretion and judgment.

SECTION 9.2   TERMS AND CONDITIONS GOVERNING TRADEMARK LICENSE

(a) Chautauqua hereby acknowledges US Airways' ownership of the US Airways
Servicemarks, further acknowledges the validity of the US Airways Servicemarks,
and agrees that it will not do anything in any way to infringe or abridge US
Airways' rights in its Servicemarks or directly or indirectly to challenge the
validity of the US Airways Servicemarks.

(b) Chautauqua agrees that, in providing the Services contemplated under this
Agreement or the Service Agreement dated February 9, 1994, as amended, it will
not advertise or make use of the US Airways Servicemarks without the prior
written approval of US Airways. US Airways will have absolute discretion to
withhold its consent concerning any and all such advertising and use of the US
Airways Servicemarks in advertising by Chautauqua. In the event US Airways
approves the use of such US Airways Servicemarks in any advertising, such
advertising will identify US Airways as the owner of such servicemarks, and
conform with any additional requirements specified by US Airways.

                                      -28-
<Page>

(c) To the extent that Chautauqua is licensed to use the US Airways Servicemarks
or the Service Agreement dated as of February 9, 1994, as amended, they will
only be used in conjunction with the Chautauqua Services specifically covered by
this Agreement and not in connection with any other businesses or activities of
Chautauqua or any other entity.

(d) Nothing in this Agreement will be construed to give Chautauqua the exclusive
right to use the US Airways Servicemarks, or to abridge US Airways' right to use
and/or license its Servicemarks, and US Airways hereby reserves the right to
continue use of the US Airways Servicemarks and to license such other uses of
said Servicemarks as US Airways may desire.

(e) No term or provision of this Agreement will be construed to give Chautauqua
the exclusive right to use the US Airways Servicemarks. US Airways hereby
reserves the right to continue use of the US Airways Servicemarks and to license
such other uses of said Servicemarks as US Airways may desire.

(f) No term or provision of this Agreement will be construed to preclude the use
of the Servicemarks "US Airways Express" or the aircraft exterior color decor
and patterns by other individuals or entities not covered by this Agreement.

(g) Upon the cancellation or termination of this Agreement, the license and use
of the US Airways Servicemarks by Chautauqua will cease, and such use will not
thereafter occur except as appropriate in any phase-out of service of this
Agreement.

                                      -29-
<Page>

ARTICLE 10  FORCE MAJEURE

SECTION 10.1  FORCE MAJEURE

Notwithstanding anything to the contrary herein contained, it is agreed that
either Party will be relieved of its obligations hereunder in the event and to
the extent that performance hereof is delayed or prevented by any cause beyond
its control and not caused by the Party claiming relief hereunder, including,
without limitation, acts of God, public enemies, war, labor shortages, strikes,
insurrection, acts or orders of governmental authorities, fire, flood,
explosion, or riots or the recovery from such cause ("force majeure"), PROVIDED,
HOWEVER, that the foregoing will not apply to the obligations of the parties
under Article 6 or the obligations of US Airways to pay for the Chautauqua
Services as and to the extent provided under Article 5 of this Agreement.

SECTION 10.2  RESUMPTION OF SERVICE

Chautauqua agrees that where relief is obtained under this provision to make its
best efforts to resume Service. Chautauqua further agrees to consult with and
advise US Airways of any anticipated delay or failure, as soon as it becomes
aware of such anticipated delay or failure or the possibility thereof, whether
for FORCE MAJEURE or otherwise, and where applicable, to reestablish applicable
timetables.

                                      -30-
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ARTICLE 11  NOTICES

Except where specified elsewhere in this Agreement, any and all notices,
approvals or demands required or permitted to be given by the Parties hereto
will be sufficient if made in writing and sent by certified mail, postage
prepaid, overnight courier or delivered by hand. When sent by mail, such notices
will also be sent by facsimile. Notices to US Airways will be addressed to:

<Table>
<S>                                                     <C>
US Airways, Inc.:                                       Chautauqua Airlines, Inc.:

Gregory T. Taylor
Vice President, US Airways Express                      President
US Airways, Inc.                                        Chautauqua Airlines, Inc.
2345 Crystal Drive                                      2500 S. High School Road
Arlington, VA 22227                                     Indianapolis, IN 46251

Facsimile: (703)872-7312                                Telephone: (317)484-6000
Telephone: (703)872-7062                                Facsimile: (317)484-6060

with copies delivered at the same address               with copies delivered to:
to the attention of US Airways' General Counsel,
Facsimile: (703)872-5252

                                                        Arthur Amron
                                                        Senior Vice President and General Counsel
                                                        Wexford Management, LLC
                                                        411-West Putnam Avenue
                                                        Greenwich, CT 06830
                                                        Telephone: (203)862-7012
                                                        Facsimile: (203)862-7312

                                                        and to

                                                        Joseph Jacobs
                                                        President
                                                        Wexford Management, LLC
                                                        411 West Putnam Avenue
                                                        Greenwich, CT 06830

                                                        Telephone: (203)862-7020
                                                        Facsimile: (203)862-7320
</Table>

                                      -31-
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ARTICLE 12  MAINTENANCE COST ADJUSTMENT

SECTION 12.1  MAINTENANCE COST RISK SHARING

Chautauqua (and/or third party providers at the direction of Chautauqua) will
maintain the Aircraft and the costs will be considered as Chautauqua Costs. At
the end of the initial seven (7) year term of this Agreement, and in the event
of an extension of such term, at the end of such extended term, Chautauqua will
account to US Airways for the maintenance costs actually incurred during such
term. In the event the cumulative aggregate Actual Aircraft Maintenance Costs
incurred during such term (the "Actual Maintenance Costs") exceed one hundred
five percent (105%) of the cumulative aggregate Aircraft maintenance costs paid
by US Airways to Chautauqua during such term (the "Paid Maintenance Costs"), US
Airways shall pay Chautauqua one half (1/2) of the amount of such excess,
provided that US Airways shall not be required to pay more than three
percent(3%) of the Paid Maintenance Costs. In the event the cumulative aggregate
Actual Maintenance Costs are less than ninety five percent (95%) of the Paid
Maintenance Costs, Chautauqua shall pay US Airways one half (1/2) of the amount
of such savings, provided that Chautauqua shall not be required to pay more than
three percent (3%) of the Paid Maintenance Costs.

SECTION 12.2  INTENTIONALLY DELETED

SECTION 12.3  MAINTENANCE COST SUMMARY

The Actual Aircraft Maintenance Cost includes the labor, materials, and third
party costs associated with maintaining the items shown in Exhibit 12.2. Within
ninety (90) days after the end of each calendar year, Chautauqua will provide a
detailed summary of the Actual Maintenance Costs incurred during such calendar
year prepared according to the generally

                                      -32-
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accepted accounting principals. US Airways will have thirty (30) days to review
and accept the maintenance cost summary.

SECTION 12.4  MAINTENANCE COST DISPUTES

Any disputes between US Airways and Chautauqua arising as a result of the
application of the Maintenance Cost Adjustment will be resolved in accordance
with the dispute resolution procedure set forth in Article 15.

                                      -33-
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ARTICLE 13  MISCELLANEOUS

SECTION 13.1  ENTIRE AGREEMENT

This Agreement constitutes the entire agreement between the parties hereto
unless subsequently amended in writing, executed by duly authorized
representatives of both parties or their respective successors in interest.

SECTION 13.2  HEADINGS

Article titles and subheadings contained herein are inserted only as a matter of
convenience and for reference. Such titles in no way define, limit, or describe
the scope or extent of any provision of this Agreement.

SECTION 13.3  SEVERABILITY

If, for any reason, any portion of this Agreement will be deemed unenforceable
or determined by a court of competent jurisdiction to be in violation of or
contrary to any applicable statute, regulation, ordinance, order, or common law
doctrine, then that portion will be of no effect. Nevertheless, the balance of
the Agreement will remain in full force and effect as if such provision were
never included.

SECTION 13.4  WAIVER

Except as otherwise specifically provided in this Agreement, a waiver by either
Party of any breach of any provision of this Agreement, or either Party's
decision not to invoke or enforce any right under this Agreement, will not be
deemed a waiver of any right or subsequent breach, and all provisions of this
Agreement will remain in force.

                                      -34-
<Page>

SECTION 13.5  ASSIGNABILITY

The Parties agree that this Agreement and the rights and obligations established
hereunder, may not be assigned, in whole or in part, without the prior written
consent of the other, where such consent will not be unreasonably withheld,
except that US Airways may assign its rights to US Airways Group, Inc., or any
subsidiary of that company, or any successor through merger, asset sale,
operation of law or the like. Chautauqua may assign its right to Wexford III
Corp., or any subsidiary of that company, or any successor through merger, asset
sale, operation of law or the like. Notwithstanding any such assignment, the
Parties agree that they will remain responsible for their financial obligations
under this Agreement.

SECTION 13.6  GOVERNING LAW

This Agreement will be governed by, construed and enforced in accordance with
the laws of the United States and the State of New York, as though the entire
contract were performed in New York and without regard to New York's conflict of
laws, rules, or statutes. The parties further agree that they consent to the
jurisdiction of the Courts of New York or the federal courts located within the
State of New York and waive any claim of jurisdiction or FORUM NON CONVENIENS.

SECTION 13.7  NO FRANCHISE

Nothing is this Agreement is intended to imply or confer upon the arrangements
contemplated hereunder, any status as a "franchise" as recognized under any
state law. Accordingly, no franchiser-franchisee relationship exists between US
Airways and Chautauqua as a result of this Agreement.

                                      -35-
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ARTICLE 14  CONFIDENTIALITY

SECTION 14.1  CONFIDENTIALITY OF AGREEMENT

The Parties agree that the terms of this Agreement and any other Confidential
Information (as defined in Section 14.2 hereof) furnished hereunder will be
treated as confidential and will not be disclosed to any other person or entity
without the express written consent of the other party; provided that each party
may, without the consent of the other party, disclose Confidential Information
as expressly permitted below:

     (a) to directors, officers, employees, permitted assigns and agents of each
     party and their respective Affiliates (as defined in Section 14.4 or 14.5
     hereof); or (b) to prospective financial institutions for the purposes of
     providing financing of Aircraft for Chautauqua; or

     (c) to subcontractors, auditors, accountants or legal and financial
     advisors of such party and its Affiliates; or

     (d) to such other parties as may be required by law, by government
     regulation or order, by subpoena or by any other legal process. In the
     event that a disclosure becomes necessary, as provided in this subclause
     (d) of this Section 14.1, each party shall consult and cooperate with the
     other party to limit (to the extent permissible) the scope and form of such
     disclosure. In the event of such disclosure required by law, only those
     portions of this Agreement required to be disclosed will be released. The
     disclosing party will make good faith efforts to minimize the portions to
     be disclosed and will seek confidential treatment by the receiving party or
     agency or any portions disclosed. In the event of one party being served a
     subpoena or discovery request, prior to responding to the subpoena or
     request, the party served will notify the other party, so that the other
     party will have an opportunity to contest, if it chooses to do so, the
     disclosure of the content of this Agreement.

                                      -36-
<Page>

SECTION 14.2  CONFIDENTIAL INFORMATION

"Confidential Information" means all restricted information having business
value, regardless of the form in which it exists, including, without limitation,
the terms of this Agreement, written documents, oral communications, recordings,
videos, software, databases, business plans, and electronic/magnetic media,
provided to or observed by either party pursuant to this Agreement, including
information owned or provided by either party to the other party, except
otherwise as expressly provided in Section 14.3 hereof. Each party agrees that
it will maintain all Confidential Information in confidence using the same
degree of care with respect to such Confidential Information as it uses in
protecting its own proprietary information, and will use it solely for purposes
of its own business operations in accordance with the terms hereof. Such
Confidential Information will be distributed within each party's company only to
personnel with a need to know such information for permitted purposes or in
compliance with a court order or statutory or regulatory requirements; PROVIDED,
HOWEVER, that prior to any such latter disclosure, the party shall inform all
such persons of the confidential nature of the information, and that it is
subject to this non-disclosure obligation, and shall further instruct such
persons to treat such information confidentially. The parties expressly
acknowledge and agree that the terms and conditions of this Agreement and any
reports, invoices, or other communications between US Airways and Chautauqua
given hereunder or in connection herewith constitute Confidential Information of
both parties.

SECTION 14.3  EXCLUSIONS FROM CONFIDENTIAL INFORMATION

Notwithstanding the foregoing, Confidential Information will not be considered
confidential and each party and their respective Affiliates may disclose any
item of Confidential Information without restriction in any of the following
circumstances if such item:

     (a) is publicly available (either to the general public or to any relevant
     trade or industry) prior to either party's receipt of it from the other
     party hereto;

                                      -37-
<Page>

     (b) is thereafter made publicly available (either to the general public or
     to any relevant trade or industry) by another party hereto or by a third
     party which is entitled to make such item publicly available; (c) becomes
     available to either party hereto on a non-confidential basis from a source
     which has represented to such party that such source is entitled to
     disclose it; or
     (d) was known to either party hereto on a non-confidential basis prior to
     its disclosure to such party by another party hereto. The provisions of
     this Article 14 will survive any termination of this Agreement for a period
     of three (3) years.

SECTION 14.4  INFORMATION SHARED WITH US AIRWAYS GROUP, INC.

Notwithstanding anything to the contrary herein, Chautauqua acknowledges and
agrees that any Confidential Information shared or given to US Airways pursuant
to this Agreement may be shared by US Airways on a confidential basis with US
Airways Group, Inc., and US Airways Affiliates, where US Airways Affiliates is
defined as subsidiaries of US Airways Group, Inc., each of which shall be deemed
"Affiliates" of US Airways for purposes of this Article 14.

SECTION 14.5  INFORMATION SHARED WITH CHAUTAUQUA

Notwithstanding anything to the contrary herein, US Airways acknowledges and
agrees that any Confidential Information shared or given to Chautauqua pursuant
to this Agreement may be shared by Chautauqua on a confidential basis with
Wexford Management LLC, Wexford III Corp. and entities that are wholly owned or
controlled by Wexford Management LLC or Wexford III Corp., each of which shall
be deemed "Affiliates" of Chautauqua for the purposes of this Article 14.

SECTION 14.6  RETURN OF DOCUMENTS

(a) Upon the reasonable request of either party, each party will immediately
return to the other party, at its own expense, all documents of the requesting
party and all copies of such

                                      -38-
<Page>

documents in its possession or under the control either directly or indirectly
of its agents. Each party acknowledges and agrees that the other party will have
the right to exercise this right as many times as it deems necessary throughout
the term of this Agreement.

(b) Upon termination of this Agreement, with or without cause and for any
reason, each party shall, within ninety (90) days of such termination, either
deliver to the other party, of destroy, all of such other party's Confidential
Information (including copies thereof encoded or stored on magnetic or other
electronic media or processors; PROVIDED, HOWEVER, that neither party shall be
required to purge or destroy any Confidential Information for so long as such
Confidential Information is reasonably necessary continued administration and
operation of their respective programs or is reasonably necessary in connection
with the resolution of any disputes which may have at the time arisen pursuant
to the terms of this Agreement; PROVIDED, FURTHER, that any Confidential
Information not purged or destroyed pursuant to the preceding proviso shall be
purged or destroyed as soon as it is no longer reasonably necessary for
continued administration or resolution of disputes.

SECTION 14.7  REMEDIES

Each party acknowledges and agrees that the party disclosing Confidential
Information under this Agreement will have no adequate remedy at law if there is
a breach or threatened breach of this Article 14 and accordingly, that the
disclosing party shall be entitled to an injunction or other equitable or
preventative relief against the other party or its representatives for such
breach or threatened breach. Nothing herein shall be construed as a waiver of
any other legal or equitable remedies which may be available to the disclosing
party in the event of a breach or threatened breach of this Article 14 and the
disclosing party may pursue any other such remedy, including the recovery of
damages.

                                      -39-
<Page>

ARTICLE 15  DISPUTE RESOLUTION

SECTION 15.1  CERTAIN DISPUTES

Any dispute, difference, controversy or claim arising out of or relating to a
significant event that might affect the accumulation of Points or a Poor
Performance Penalty under Section 8.2 of this Agreement, the Maintenance Cost
Adjustment set forth in Article 12 or the adjustment of Per Block Hour Costs
under Section 5.2(a), the breach or non-performance thereof shall first be
attempted to be resolved by US Airways and Chautauqua through mutual
negotiations, consultation and discussions for a period of thirty (30) days.

SECTION 15.2  DISPUTE RESOLUTION PROCEEDINGS

In the event that the parties are unable to settle their differences or disputes
which may arise between them under Section 15.1, above, then either party may
submit such dispute ("Dispute") for binding arbitration with the following
conditions:
     (a) the proceeding will be held before a panel of three arbitrators where
     each party will choose one arbitrator and the third will be selected
     jointly by the two appointed arbitrators and, where such agreement cannot
     be reached, by appointment of the Administrator of the American Arbitration
     Association or his or her designee;
     (b) except as modified by this Article, the Arbitration Rules of the
     American Arbitration Association will govern the arbitration;
     (c) the proceeding will be conducted in the State of New York;
     (d) the law and common Law of the United States and the State of New York
     will be applied without regard to New York conflict of laws statutes;
     (e) the proceeding will be closed except to the parties, their attorneys,
     representatives, witnesses and experts, all of whom must agree to maintain
     the confidentiality of the dispute;

                                      -40-
<Page>

     (f) the existence, proceeding and resolution of the Dispute will be kept
     confidential by the parties and will only be disclosed to parties and
     individuals with a need to know of its existence and who will agree to
     maintain confidentiality;
     (g) the arbitration will be binding upon the parties unless mutually agreed
     otherwise in writing; and
     (h) each party will be responsible for its own costs and expense incurred
     as a result of, or in connection with the arbitration, including the costs,
     fees, and expenses of its own representatives and designated arbitrator, in
     the proceeding, except that the costs of the third arbitrator will be
     shared jointly by the parties.

IN WITNESS WHEREOF, US Airways and Chautauqua have caused this Agreement to be
executed by their duly authorized representatives on the day and year first
above written.

CHAUTAUQUA AIRLINES, INC.                           US AIRWAYS, INC.

/s/ Arthur Amron                                    /s/ Gregory T. Taylor
----------------------------                        ----------------------------

By:    Bryan Bedford                                By:    Bryan Bedford
Title: Vice President                               Title: Vice President
Chautauqua Airlines, Inc.                           US Airways Express

/s/ Kia E. Hardy                                    /s/ [ILLEGIBLE]
----------------------------                        ----------------------------
Witness                                             Witness

[SEAL]                                              [SEAL]

                                      -41-
<Page>

EXHIBIT 2.1     *IMPLEMENTATION SCHEDULE OF AIRCRAFT DEPLOYMENT

<Table>
<Caption>
DATE                         NUMBER OF OPERATIONAL AIRCRAFT
<S>                                      <C>
July 1999                                 2
September 1999                            3
December 1999                             4
February 2000                             5
April 2000                                6
June 2000                                 7
August 2000                               8
October 2000                              9
December 2000                            10
</Table>

----------
*    Subject to revision only due to delivery delays by Embraer.

                                      -42-
<Page>

EXHIBIT 2.1(a)  SCHEDULE REQUIREMENTS

The weekly schedules for the Aircraft specified by US Airways must meet the
following [*] schedule parameters.

                                                 [*]           [*]
Scheduled Block Hours per Aircraft per Day       [*]           [*]
Scheduled Departures per Aircraft per Day        [*]           [*]
Available Seat Miles per Aircraft per Day        [*]           [*]

US Airways will meet the following criteria in devising the schedule:

1.   Aircraft Turn Times

For operations at US Airways designated hubs (for purposes of this Agreement
only, Pittsburgh, Boston, Washington-National, New York LaGuardia, Charlotte,
Philadelphia, and Dulles and any other hubs that US Airways may establish) the
minimum turn time (defined as the time from Aircraft blocking to Aircraft
unblocking) will be [*] minutes. For operations at a non US Airways hub, the
minimum turn time will be [*] minutes.

2.   Aircraft Maintenance Requirements

During the period Chautauqua operates up to [*] Aircraft, [*] Aircraft will be
scheduled for overnight maintenance for a minimum period of [*] per day for [*]
each week. 1n addition, [*] Aircraft will be scheduled for [*] of continuous
maintenance time each week beginning on Saturday afternoon. [*]

                                      -43-

--------------
* Confidential

<Page>

3.   Maintenance Base

The schedule will allow for the establishment of a single maintenance base in
Indianapolis, Indiana.

4.   Crew Overnights

The schedule will allow for [*] of crews in outstations and will not require
Chautauqua to schedule [*].

5.   Crew Bases
     [*]

6.   Hub Arrivals/Departures
     [*]

7.   Consent to Schedule Changes

To the extent that US Airways' schedule falls outside of the criteria set forth
herein, US Airways shall request Chautauqua to consent to such schedule and
Chautauqua shall not unreasonably withhold such consent provided that the
schedule being requested will not impose additional costs upon Chautauqua and/or
make Chautauqua's compliance with its performance requirements more difficult,
further provided that US Airways shall have the right to reimburse Chautauqua
for such additional costs and/or adjust the performance criteria so that the
immediately proceeding proviso shall no longer be applicable to the schedule
request in question.

                                      -44-

--------------
* Confidential

<Page>

EXHIBIT 2.8     DIVISION OF RESPONSIBILITIES

(1)  The parties will be responsible for providing, at their own cost, service
and materials, as set forth below, Assignment of services and materials to
categories will be according to generally accepted accounting principals and in
keeping with Airline Industry Standard Functional Classifications as required
for reporting Form 41 data to the Department of Transportation. Except as
otherwise provided in Articles 4 and 5, the assignment of responsibility will be
as follows:

<Table>
<S>    <C>                                         <C>
       TO CHAUTAUQUA                               TO US AIRWAYS, INC.

5100   Flying Operations                           5500   Passenger Service(1)

5200   Direct Maintenance                          6200   Traffic Servicing

5300   Maintenance Burden(2)                       6300   Related to Traffic Servicing

6100   Aircraft Servicing(3)                       6500   Reservations and Sales

6300   Related to Aircraft Servicing               6600   Advertising and Publicity

6800   Related to Aircraft Operations              6800   Related to Passengers & Revenue

7000   Depreciation and Amortization related       7000   Depreciation and Amortization related
       to aircraftand maintenance equipment               airport facilities and ground facilities
                                                          and equipment

7100   Transport Related Expenses as they          7100   Transport Related Expenses as they relate
       relate to the above referenced items               to the above referenced items
</Table>

(2)  Chautauqua will be responsible for providing, fuel (into plane), airport
landing fees, passenger catering, passenger liability insurance, and property
tax. Chautauqua will be fully reimbursed for these items (the "Pass Through
Costs") as described in Section 5.4.

----------
1    Except Flight Attendant which will be the responsibility of Chautaugua
2    Except Station Ground Equipment which will be the responsibility of US
     Airways
3    De-icing costs and overnight aircraft parking shall be the responsibility
     of US Airways

                                      -45-
<Page>

EXHIBIT 5.1     PRICING MODEL SUBJECT TO REVIEW BY BOTH PARTIES

                                       [*]

                                      -46-

--------------
* Confidential

<Page>

EXHIBIT 12.2    AIRCRAFT MAINTENANCE ITEMS*

APU (Sundstrand)                         Central MTC System (ATA ref. 45)

Engine (Allison)                         Airborne Auxiliary Power (ATA ref 49)

Avionics (Honeywell)                     Structures (ATA ref. 51)

Placards & Markings (ATA ref 11)         Doors (ATA ref. 52 and 53)

AC Press (ATA ref. 21)                   Nacelles/Pylons (ATA ref 54)

Auto Flight (ATA ref 22)                 Stabilizers (ATA ref 55)

Communications (ATA ref. 23)             Windows (ATA ref. 56)

Electrical Power (ATA ref. 24)           Wings (ATA ref 57

Interior (ATA ref. 25)                   Engine Mounting (ATA ref 71)

Fire Protection (ATA ref. 26)            Engines (ATA ref 72)

Flight Controls (ATA ref. 27)            Fuel & Control (ATA ref 73)

Fuel System (ATA ref, 28)                Ignition (ATA ref 74)

Hydraulic Systems (ATA ref. 29)          Engine Controls (ATA ref 76)

Ice/Rain Prot (ATA ref. 30)              Engine Indicating (ATA ref. 77)

Indicating & Rec. (ATA ref. 31)          Exhaust (ATA ref. 78)

Landing Gear (ATA ref. 32)               Oil (ATA ref 79)

Lights (ATA ref. 33)                     Starting (ATA ref. 80)

Navigation (ATA ref. 34)

Oxygen (ATA ref. 35)

Bleed Air (ATA ref. 36)

Waste Water (ATA ref. 38)

--------
*    Aircraft maintenance subjects as defined by the Air Transportation
     Authority (ATA)

                                       -1-<Page>

                                                                   EXHIBIT 10.13

                                   EMB-145LR
                                   ---------

                             AMENDED AND RESTATED
                             --------------------

                      PURCHASE AGREEMENT NUMBER GCT-025/98
                      ------------------------------------

                EMBRAER - EMPRESA BRASILEIRA DE AERONAUTICA S.A.
                ------------------------------------------------

                                      AND
                                      ---

                        REPUBLIC AIRWAYS HOLDINGS, INC.
                        -------------------------------

----------
Certain portions of this exhibit have been omitted pursuant to a request for
confidential treatment under Rule 406 of the Securities Act of 1933. The
omitted materials have been filed separately with the Securities and Exchange
Commission.

<Page>

                                    INDEX
                                    -----

  ARTICLE
  -------

  01    -  DEFINITIONS
  02    -  SUBJECT
  03    -  PRICE
  04    -  PAYMENT
  05    -  DELIVERY
  06    -  CERTIFICATION
  07    -  ACCEPTANCE AND TRANSFER OF OWNERSHIP
  08    -  STORAGE CHARGE
  09    -  DELAYS IN DELIVERY
  10    -  INSPECTION AND QUALITY CONTROL
  11    -  CHANGES
  12    -  WARRANTY
  13    -  TECHNICAL ASSISTANCE SERVICES
  14    -  SPARE PARTS POLICY
  15    -  PUBLICATIONS
  16    -  ASSIGNMENT
  17    -  RESTRICTIONS AND PATENT INDEMNITY
  18    -  MARKETING AND PROMOTIONAL RIGHTS
  19    -  TAXES
  20    -  APPLICABLE LAW
  21    -  ARBITRATION
  22    -  JURISDICTION
  23    -  TERMINATION
  24    -  OPTION FOR THE PURCHASE OF ADDITIONAL EMB-145 AIRCRAFT
  25    -  INDEMNITY
  26    -  NOTICES
  27    -  CONFIDENTIALITY
  28    -  INTEGRATED AGREEMENT
  29    -  NEGOTIATED AGREEMENT
  30    -  COUNTERPARTS
  31    -  ENTIRE AGREEMENT
  32    -  NO WAIVER
  33    -  REPRESENTATIONS AND WARRANTIES
  34    -  EFFECTIVENESS

<Page>

                                  ATTACHMENTS
                                  -----------

  "A-1"- US AIRWAYS AIRCRAFT SPECIFIC CONFIGURATION, FINISHING AND REGISTRATION
         MARKS

  "A-2"- AMERICA WEST AIRCRAFT SPECIFIC CONFIGURATION, FINISHING AND
         REGISTRATION MARKS

  "B"- FERRY EQUIPMENT, SPARE PARTS POLICY AND LIST OF PUBLICATIONS

  "C" - WARRANTY CERTIFICATE - MATERIAL AND  WORKMANSHIP

  "D" - AIRCRAFT PRICE ESCALATION FORMULA

  "E" - AUTHORIZED REPRESENTATIVE APPOINTMENT

  "F" - FORM OF WARRANTY BILL OF SALE

  "G" - FORM OF GUARANTEE

<Page>

                              AMENDED AND RESTATED
                              --------------------
                        PURCHASE AGREEMENT NO. GCT-025/98
                        ---------------------------------

This Amended and Restated Purchase Agreement is entered into as of this 19 day
of April, 2002 by and between Embraer - Empresa Brasileira de Aeronautica S.A.
and Republic Airways Holdings, Inc., for the purchase and sale of Embraer
aircraft, services and related spare parts.

Solitair Corp. ("Solitair") has assigned to Buyer (as defined below) all of
Solitair's rights and obligations under the Purchase Agreement DCT-025/98
between Embraer and Solitair (as amended before the date of this agreement, the
"Original Purchase Agreement"), with respect to the sale of twenty (20)
unexercised option aircraft (as defined below).

In connection with such assignment, Solitair has also assigned its remaining
rights with respect to the fleet of aircraft delivered under the Original
Purchase Agreement. Solitair has retained its rights and obligations with
respect to the five (5) additional aircraft currently scheduled for delivery
under the Original Purchase Agreement.

This Agreement (as defined below):

     (a) amends and restates all rights and obligations of Embraer and Buyer
     with respect to the twenty (20) unexercised option aircraft under the
     Original Purchase Agreement;

     (b) states the rights and obligations of Embraer and Buyer with respect to
     seventeen (17) additional option aircraft that were previously connected to
     the Original Purchase Agreement;

     (c) states the terms and conditions upon which the "Buyer's" remaining
     rights under the Original Purchase Agreement will apply to the forty-eight
     (48) aircraft previously delivered under the Original Purchase Agreement
     and the five (5) additional aircraft scheduled for delivery under the
     Original Purchase Agreement.

The sale covered by this Agreement shall be governed solely by the terms and
conditions herein set forth, as well as by the provisions set forth in the
attachments hereto. Except as expressly provided to the contrary herein, nothing
in this Agreement shall be deemed to grant Buyer or Chautauqua (as defined
herein) any rights with respect to undelivered aircraft other than the
thirty-seven (37) Option Aircraft (as defined below).

1. DEFINITIONS

----------

<Page>

    For the purpose of this Agreement, the following definitions are hereby
adopted:

a.    Actual Delivery Date - shall mean, with respect to each Aircraft, the date
      on which Buyer obtains title to that Aircraft in accordance with Article
      7(c).

b.    Aircraft - shall mean the EMB-145 LR aircraft or, where there is more than
      one of such aircraft, each of such Aircraft (including Firm Aircraft and
      Option Aircraft, as the context requires), manufactured by Embraer, for
      sale to Buyer pursuant to this Agreement, according to the Technical
      Description number TD-145/010, dated January 1998 (Appendix I), the
      Aircraft Specific Configuration, Finishing and Registration Marks
      described in Attachment `A-1' (or `A-2', if Buyer notifies Embraer that it
      desires to receive the Aircraft such configuration [*], and as may be
      amended from time to time by Buyer at its expense as specified in Article
      11. [*]

c.    Agreement - shall mean this Amended and Restated Purchase Agreement No.
      GCT-025/98, its Schedules, and any Letter Agreement between the Parties
      executed on the date hereof.

d.    Business Day - shall mean days on which the banks in each of New York, New
      York, United States and Sao Paulo, and Sao Jose dos Campos, S.P. Brazil
      are open for the normal transaction of business.

e.    Basic Price - shall mean the Aircraft total price, effective on the date
      of execution of this Agreement contained in Article 3 (a)(1) or, in case
      of revision thereof, on the date of its revision.

f.    Buyer - shall mean REPUBLIC AIRWAYS HOLDINGS, INC., a Delaware corporation
      with its principal place of business at 2500 S. High School Road,
      Indianapolis, Indiana 46241, United States or its assignee pursuant to
      Article 16 hereof.

g.    Chautauqua - shall mean Chautauqua Airlines, Inc.

h.    Contractual Delivery Date - shall mean the delivery dates referred to in
      Article 5 hereof.

i.    CTA - shall mean the Aerospace Technical Center of the Brazilian Ministry
      of Aeronautics.

j.    Embraer - shall mean EMBRAER - Empresa Brasileira de Aeronautica S.A., a
      Brazilian corporation with its principal place of business at Av.
      Brigadeiro Faria Lima, 2170 - Putim, Sao Jose dos Campos, Sao Paulo,
      Brazil.

----------
* Confidential

<Page>

k.    FAA - shall mean the Federal Aviation Administration of the United States
      of America.

l.    Firm Aircraft - shall have the meaning specified in Article 2.a hereof.

m.    Initial Provision List or "IPL" - shall have the meaning specified in
      Article 2.b hereof.

n.    Option Aircraft - shall have the meaning specified in Article 2.a hereof.

o.    Parties - shall mean Embraer and Buyer.

p.    Purchase Price - shall mean the Aircraft total price, effective on the
      relevant Aircraft Contractual Delivery Date, resulting from the
      application of the Escalation Formula contained in Attachment "D" pursuant
      to the terms hereof.

q.    Services - shall mean technical assistance services, as specified in
      Article 13 hereof.

r.    Spares - shall mean line replaceable units, spare parts and ground support
      equipment, except engines, available for purchase through Embraer, to be
      selected and acquired by Buyer through the initial provisioning list
      agreed to by the Parties and provided pursuant to Article 2.b. (the
      "IPL").

2. SUBJECT

a.    Embraer shall sell and Buyer shall purchase and take delivery of zero (0)
      firm order Aircraft ("Firm Aircraft") and, if Buyer so elects, up to
      thirty-seven (37) option Aircraft ("Option Aircraft") upon the terms and
      conditions contained in this Agreement.

b.    Embraer shall sell, and Buyer shall acquire, Spares for each of the
      Aircraft. Buyer shall inform Embraer at least [*] prior to the Contractual
      Delivery Date of the Spares for each Aircraft selected from IPL for such
      Aircraft and such Spares shall be delivered in accordance with Article
      5.b.

c.    Embraer shall render the Services as specified in Article 13.

3. PRICE

a.    Buyer agrees to pay Embraer, subject to the terms and conditions of this
      Agreement, in United States dollars, the following prices:

      1.    The Aircraft Basic Price of [*]

----------
* Confidential

<Page>

      2.    Buyer shall have in its sole discretion the right to purchase up to
            [*], with respect to Spares.

            [*]

            b.    The Services are to be provided [*].

            c.    The Aircraft Basic Price [*]. Such price as escalated shall be
                  the Aircraft Purchase Price and [*].

4.  PAYMENT

      The prices specified in the previous Article shall be paid in cash, by
      means of a wire transfer, on each Business Day specified below by Buyer as
      follows for Firm Aircraft:

      a.    Aircraft

            1.    An initial deposit of [*].

            2.    A [*] progress payment [*] is due and payable [*] prior to
                  each relevant Aircraft Contractual Delivery Date.

            3.    A [*] progress payment [*], is due and payable [*] prior to
                  each relevant Aircraft Contractual Delivery Date.

            4.    A [*] progress payment [*], is due and payable [*] prior to
                  each relevant Aircraft Contractual Delivery Date.

            5.    The balance of each Aircraft Purchase Price, shall become due
                  and payable upon acceptance of each relevant Aircraft by
                  Buyer.

      b.    Spares:

            1.    [*] of the price of Spares for each Aircraft shall become due
                  and payable [*] prior to the relevant Aircraft Contractual
                  Delivery

----------
* Confidential

<Page>

                  Date or the date of delivery of the Spares calculated in
                  accordance with Article 5.b [*].

            2.    [*] of the price of the Spares for each Aircraft shall become
                  due and payable upon delivery of the Spares items as set forth
                  in Article 5.b.

      c.    Late Payments and Termination for Failure to Make Payments:

            Interest will accrue at a Rate of [*] on any amount not paid to
            Embraer as set forth in Article 4.a and 4.b above from the date on
            which such payments should have been made or as set forth therein
            until the actual receipt by Embraer of such amounts. [*]

5.    DELIVERY

      a.    AIRCRAFT: Subject to payment in accordance with Article 4 and the
            provisions of Articles 4, 7 and 9, the Aircraft shall be offered for
            delivery by Embraer to Buyer, by

----------
* Confidential

<Page>

            means of a notice, for inspection, acceptance and subsequent
            delivery in F.A.F. (Fly Away Factory) condition, at Sao Jose dos
            Campos, State of Sao Paulo, Brazil, according to the schedule set
            forth in Article 24 and subject to the terms of that article.

      b.    SPARES: Subject to receipt by Embraer of the list of Spares selected
            by Buyer from the IPL in accordance with Article 2.b, such items
            shall be delivered by Embraer to Buyer in F.C.A. (Free Carrier -
            INCOTERMS 1990) condition, at Sao Jose dos Campos, State of Sao
            Paulo, Brazil, or at any other port of clearance that Embraer may
            identify to Buyer. The provision of Spares for each Aircraft shall
            be delivered on the relevant Aircraft Actual Delivery Date. [*]

6.    CERTIFICATION

      On the Actual Delivery Date of an Aircraft, the EMB 145-LR aircraft shall
      have valid and effective type certificates issued by the CTA and FAA. The
      Aircraft shall also be delivered to Buyer with an export certificate of
      airworthiness issued by CTA complying with the requirements of FAA
      regulation ("FAR") Part 25 and the requirements of the FAA. The condition
      of the Aircraft on delivery and the documentation delivered with the
      Aircraft, including the above mentioned export certificate of
      airworthiness, shall be sufficient to enable Buyer to obtain an FAR Part
      25 certificate of airworthiness for the Aircraft. Subject to the above, it
      shall be Buyer's responsibility to obtain such certificate of
      airworthiness for the Aircraft, at Buyer's sole expense, although
      Embraer will provide assistance if requested to do so, at Buyer's cost.
      [*]

7.    ACCEPTANCE AND TRANSFER OF OWNERSHIP

      a.    Unless Embraer notifies Buyer otherwise, the Aircraft shall be
            delivered in accordance with the provisions and schedules specified
            in Article 5 herein. Embraer shall give Buyer [*] advance notice of
            the date on which Embraer considers that each Aircraft will be ready
            for delivery in the condition specified herein. Upon successful
            completion of ground and flight tests performed by Embraer, Buyer
            will receive a confirmation from Embraer of the day that the
            Aircraft concerned is ready for inspection and will provide Buyer
            within [*] notice of the date of such inspection.

----------
* Confidential

<Page>

      b.    Buyer shall be allowed a reasonable period of time to conduct a
            ground inspection and an acceptance flight or flights, if necessary
            ("Inspection") of each Aircraft prior to its delivery. [*] After
            such acceptance flight and if Buyer accepts the Aircraft in
            accordance with this Article 7, each Aircraft will be delivered by
            Embraer to Buyer in accordance with Article 6 hereof [*].

      c.    Buyer shall accept the Aircraft provided, in the reasonable
            determination of Buyer, the Aircraft meets the terms and conditions
            of this Agreement. Immediately after such acceptance, Buyer shall
            make the payments due, if any, according to Article 4 and accept
            delivery of such Aircraft, whereupon [*] title and risk of loss will
            be transferred to Buyer and Buyer shall execute the necessary title
            and risk transfer documents required in order to effect title
            transfer, including but not limited to an FAA form Bill of Sale and
            a Warranty Bill of Sale substantially in the form attached hereto as
            Schedule G. [*]

      d.    If Buyer declines to accept an Aircraft after its Inspection because
            the Aircraft failed to meet the terms of this Agreement, Buyer shall
            immediately give Embraer notice of all specific reasons for such
            refusal and [*], commencing on the first Business Day after receipt
            of such notice, to take all necessary actions [*].

      e.    Buyer shall inspect the Aircraft, as provided for in Article 7.b.,
            within [*] notice from Embraer that all necessary actions were taken
            ("Reinspection"). [*]

      f.    Embraer shall ensure that the Spares for each Aircraft are available
            for inspection by Buyer on or before the date of delivery in
            accordance with Article 5.b. and shall notify Buyer of such
            availability. Buyer shall be allowed to inspect the Spares to be
            delivered in connection with each Aircraft. [*]

----------
* Confidential

<Page>

      g.    Should Buyer fail to comply with the procedures specified in any of
            the preceding items 7 (a) through 7 (e), Embraer shall not be held
            liable for any delays in delivery resulting from such failure.

      h.    [*]

      i.    Buyer shall be permitted to delegate its duties in this Article 7
            and in Article 5 as to the physical inspection, reinspection, and
            acceptance and delivery of the Aircraft and Spares to its authorized
            representative in the form attached hereto as Schedule F.

      j.    [*]

----------
* Confidential

<Page>

8.    STORAGE CHARGE

      a.    A storage charge equal to [*] shall be charged by Embraer to Buyer
            commencing on:

            1.    Buyer's failure to perform Inspection or Re-inspection of an
                  Aircraft, per the date or time period specified in writing by
                  Embraer, according to Article 7.

            2.    Buyer's acceptance of an Aircraft when Buyer defaults in the
                  fulfillment of any payment due and in taking title to such
                  Aircraft immediately thereafter.

            3.    Buyer's failure within [*] after title transfer to remove an
                  Aircraft from Embraer's facilities.

                  Storage charges shall end on the earlier of i) Buyer's and
                  Embraer's agreement to end such storage charge, ii) removal of
                  the relevant Aircraft from Embraer's facilities or iii) in the
                  event this Agreement with respect to such Aircraft is
                  terminated in accordance with Article 23.

                  If however, Buyer notifies Embraer in writing [*] in advance
                  of its expected delay in the performance of its obligations
                  set forth in this Article 8, the storage charge shall commence
                  [*] after the occurrence of the events set forth in this
                  Article 8.a.

      b.    In the event that an Aircraft Contractual Delivery Date must be
            extended by Embraer from that which is designated in Article 5, due
            to Buyer's failure to perform any action or provide any information
            contemplated by this Agreement other than the ones specified in the
            preceding items, and the Aircraft otherwise was to be delivered on
            the Contractual Delivery Date, the storage charge shall commence [*]
            after the Contractual Delivery Date relative to such Aircraft.

      c.    Buyer shall pay the storage charge set forth in Article 8.a. and
            8.b., as applicable, per each month of delay or part thereof, within
            [*] after the presentation of each invoice by Embraer.

9.    DELAYS IN DELIVERY

      a.    EXCUSABLE DELAYS:

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            1.    Embraer shall not be held liable or be found in default for
                  any delays in the delivery of an Aircraft or any Spares or in
                  the performance of any act to be performed by Embraer under
                  this Agreement, resulting from the following events or
                  occurrences, hereinafter referred to as "Excusable Delays":
                  [*]

            2.    Within [*] after the occurrence of any of the above mentioned
                  events which constitute causes of Excusable Delays in delivery
                  of an Aircraft or any Spares or in the performance of any act
                  to be performed by Embraer under this Agreement, Embraer shall
                  send a notice to Buyer, [*].

            3.    Any such delays shall extend the time for delivery of an
                  Aircraft or Spares by [*].

            4.    If the cause of such Excusable Delay is such as to last longer
                  than [*], then Buyer shall have the option to terminate this
                  Agreement without liability to either party, in accordance
                  with Article 23.b.

      b.    NON-EXCUSABLE DELAYS:

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            1.    If the delivery of an Aircraft or Spares is delayed, not as a
                  result of an Excusable Delay [*]

            2.    [*]

            3.    [*]

            4.    [*]

            5.    [*]

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      c.    DELAY DUE TO LOSS OR STRUCTURAL DAMAGE TO THE AIRCRAFT:

            Should any Aircraft be destroyed or damaged before acceptance by the
            Buyer to the extent that it becomes commercially useless, Buyer may,
            at its sole discretion take a replacement Aircraft under the same
            terms and conditions of this Agreement at a later delivery date to
            be agreed by the Parties. Within three (3) months after such loss,
            Embraer will provide Buyer with a new delivery date for a
            replacement Aircraft. [*]

10.   INSPECTION AND QUALITY CONTROL

      a.    Buyer is hereby permitted to have one or more authorized
            representatives at Embraer's facilities for a period commencing [*]
            prior to the Contractual Delivery Date of each Aircraft in order to
            assure that the Aircraft, Spares and Services were developed in
            accordance with the procedures specified in this Agreement and
            according to all applicable quality control standards. Buyer may
            communicate its concerns as to the production of the Aircraft and
            Spares to Embraer.

      b.    Buyer shall communicate to Embraer the names of its authorized
            representatives, by means of notice, at least fifteen (15) days
            prior to the arrival of the authorized representatives. Buyer may
            substitute authorized representatives, provided written notice is
            given to Embraer fifteen (15) calendar days prior to effectivity.

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      c.    Such representatives may also be authorized to sign the acceptance
            and transfer of title and risk documents and accept delivery of the
            Aircraft and Spares pursuant to Article 7.

      d.    With respect to this Article 10, Embraer shall provide for use in
            accordance with the Agreement at no cost to Buyer, communication
            facilities (telephone and facsimile) for Buyer's authorized
            representatives, as well as the necessary tools, measuring devices,
            test equipment and technical assistance as may be necessary to
            perform acceptance tests.

      e.    Buyer's authorized representatives shall observe Embraer's
            administrative rules and instructions while at Embraer's facilities,
            and Buyer's representatives will be provided with all appropriate
            rules and regulations upon arrival.

      f.    Buyer's authorized representatives shall be allowed exclusively in
            those areas related to the subject matter hereof and Buyer agrees to
            hold harmless Embraer from and against all and any kind of
            liabilities in respect to such representatives, for whom Buyer is
            solely and fully responsible under all circumstances and in any
            instance except to the extent caused by the gross negligence or
            willful misconduct of Embraer, its officers, directors, employees or
            agents.

11. CHANGES

      a.    At delivery each Aircraft will comply with the standards defined in
            Attachment "A-1 or "A-2" as applicable and shall incorporate all
            modifications which are classified as Airworthiness Directives
            (AD's) mandatory by CTA or FAA and shall also at Delivery
            incorporate any change agreed upon by Buyer and Embraer in
            accordance with this Article 11.

      b.    [*]

      c.    Embraer may make changes in the design of the Aircraft, the
            definition of which and its respective classification shall be in
            compliance to the Aircraft type specification, as follows:

            1.    MINOR CHANGES: defined as those modifications which shall not
                  adversely affect the Aircraft in any of the following:

                  [*]

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            2.    MAJOR CHANGES: defined as those modifications which affect at
                  least one of the topics mentioned in item "c.1." above.

      d.    Embraer shall have the right, without the prior consent of Buyer, to
            make Minor Changes, as referred to in item "c.1" above, in the
            design of the Aircraft. The costs of any such changes shall be borne
            by Embraer.

      e.    Major Changes as referred to in item "c.2." above which are
            classified as AD's mandatory by CTA and or FAA shall be conveyed to
            Buyer by means of Service Bulletins, approved by said authorities.
            Incorporation of such Service Bulletins in all Aircraft and Spares
            yet to be delivered to Buyer will be made by Embraer at Embraer's
            own costs, in a commercially reasonable period of time. [*]

            Whenever warranty coverage is not available or applicable, item "e"
            of this Article 11 shall apply. [*]

            Embraer shall not be held liable for any delays in the Aircraft
            Contractual Delivery Date resulting from the execution of any change
            classified as mandatory by CTA or FAA when the Aircraft shall have
            already passed the specific production stage affected by the
            incorporation of said change. [*]

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      f.    Major Changes (other than those which are AD's mandatory per item
            "e" above), any change developed by Embraer as product improvement,
            and any change requested by Buyer which are either Major or Minor,
            including those changes required by FAA as a consequence of [*]
            shall be considered as optional and, pursuant to Buyer's request,
            the corresponding cost proposals shall be submitted by Embraer to
            Buyer for consideration and approval. Should Buyer not approve any
            such change, it shall not be incorporated in the Aircraft.

      g.    Any change made by Embraer in accordance with the preceding items
            which affects the provisions of Attachment "A", shall be
            incorporated in said Attachment by means of an amendment. The
            amendment shall be submitted to Buyer for signature thirty (30) days
            prior to the relevant Aircraft Contractual Delivery Date, a copy of
            which shall be received by Embraer, duly signed, prior to such
            Aircraft Actual Delivery Date.

      h.    [*]

12.   WARRANTY

      The Aircraft and Spares will be warranted in accordance with the terms and
      conditions specified in Attachment "C". The warranty may not be assigned
      except as permitted by Article 16.

13. TECHNICAL ASSISTANCE SERVICES

      a.    Familiarization and technical support programs specified below are
            being offered at no charge to Buyer unless otherwise specified,
            except for the expenses involved with travel and lodging of
            Chautauqua's trainees, which shall be borne by Buyer or Chautauqua.
            Such familiarization and technical support programs shall be in
            accordance with Embraer's training syllabus.

      b.    Notwithstanding the use of the term "training" in this Article 13 or
            in the Agreement, the intent of the Services is solely to
            familiarize Chautauqua's pilots, mechanics, employees or
            representatives, duly qualified per the governing body

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            in the United Sates of America, with the operation and maintenance
            of the Aircraft. It is not the intent of Embraer to provide basic
            training ("Ab-initio") to any representatives of Chautauqua.

      c.    [*] Chautauqua must give notice to Embraer one-hundred and twenty
            (120) days in advance of its expected training schedule. Should
            Buyer or Chautauqua not take all or any portion of the Services on
            or before the delivery of Buyer's last Aircraft, Buyer and
            Chautauqua shall be deemed to have fully waived their rights to such
            service. No other penalty or indemnity shall be due from Embraer in
            this case.

      d.    All Services shall be provided by Embraer or its qualified
            designated representative at Embraer's facilities at Fort
            Lauderdale, Florida, USA, or at such other location as Embraer shall
            reasonably designate in the United States, except that flight
            training may also be designated by Embraer to occur in Brazil if it
            cannot reasonably occur in the United States.

      e.    The Services in regard to the Firm Aircraft shall include:

            1.    One (1) Pilot Familiarization Program [*] including ground
                  familiarization as regards Aircraft systems, weight and
                  balance, performance and normal/emergency procedures; Flight
                  simulator training in accordance with Chautauqua's approved
                  Flight Operations Training Program, up to, but not exceeding
                  the equivalent training in Level C simulator.

            2.    One (1) Maintenance Familiarization Course [*]. This course
                  shall consist of classroom familiarization with Aircraft
                  systems and structures and shall be in accordance with ATA
                  specification 104, level III.

            3.    One (1) Flight Attendant Familiarization Course [*]. This
                  course shall consist of classroom familiarization, including a
                  general description of Aircraft and systems to be used by
                  flight attendants if requested, Embraer may demonstrate
                  procedures described in the classroom, subject to Buyer's
                  Aircraft availability.

            4.    [*]

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                  Thereafter, every time Buyer requests the placement of an
                  Embraer technical representative at Chautauqua's
                  installations, Embraer will charge Buyer according to
                  Embraer's price list per month per each such Embraer technical
                  representative's presence. At no charge to Embraer, Buyer
                  shall insure and require Chautauqua to provide such
                  representative with reasonable communication facilities
                  (telephone and facsimile) as well as office space and
                  facilities at the maintenance base(s) of Chautauqua. Buyer
                  shall also cause Chautauqua to (a) arrange all necessary work
                  permits and airport security clearances required for Embraer
                  employees, to permit the accomplishment of the services
                  mentioned in this item "4", in due time; and (b) obtain all
                  necessary custom clearances both to enter and depart from the
                  United States for Embraer's employees and their personal
                  belongings and professional tools. During the stay of the
                  Embraer's technical representative at Chautauqua's base, Buyer
                  shall cause Chautauqua to permit access to the maintenance and
                  operation facilities as well as to the data and files of
                  Chautauqua's fleet of aircraft to the extent necessary to
                  perform its obligations hereunder. [*] Buyer shall cause
                  Chautauqua to make available at the office designated for the
                  technical representative, one (1) set of updated Technical
                  Publications referred to in Article 15, and it shall be
                  Chautauqua's responsibility to perform the revision services
                  in order to maintain such publications updated during the
                  technical representative's stay at Chautauqua's base. Buyer
                  shall bear all expenses related to the transportation, board &
                  lodging of Embraer representative when such representative
                  shall render the services specified herein in any place other
                  than Chautauqua's main maintenance base.

                  Without a previous written authorization from Embraer, Embraer
                  technical representatives shall not participate in test
                  flights or flight demonstrations. If Chautauqua obtains such
                  authorization, Chautauqua shall include the technical
                  representative in Chautauqua's insurance policy. Embraer
                  reserves the right to stop the services mentioned in this item
                  "4", should any of the following situations occur at
                  Chautauqua's base: a) there is a declared strike in progress;
                  b) war or war like operations, riots or insurrections; c) any
                  condition which is dangerous to the safety or health of
                  Embraer's employee; or d) the government of the United States
                  refuses permission to Embraer's employee to enter the country.

      f.    If Buyer or Chautauqua elects not to take all or any portion of the
            Services, [*]. Any other additional services shall depend on
            subsequent agreement and shall be charged by Embraer accordingly.

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      g.    Buyer and Chautauqua's authorized trainees and representatives at
            Embraer's facilities shall be allowed exclusively in those areas
            related to the subject matter hereof and Buyer agrees to, and to
            cause the relevant Designated Operator to, hold harmless Embraer
            from and against all and any kind of liabilities in respect of such
            trainees and representatives for whom Buyer and Chautauqua, as the
            case may be, are solely and fully responsible under all
            circumstances, except to the extent [*].

14.   SPARE PARTS POLICY

      [*] Such spare parts and ground support equipment shall be supplied
      according to the prevailing availability, sale conditions, delivery
      schedule and effective price on the date of acceptance by Embraer of the
      purchase order. The spare parts and ground support equipment may be
      supplied either by Embraer or through its subsidiaries or branch offices
      located abroad.

15. PUBLICATIONS

      a.    AIRCRAFT PUBLICATIONS - Embraer has supplied, [*], copies of
            operational and maintenance publications applicable thereto, in the
            English language and in the quantities as specified in item "3" of
            Attachment "B", other than those to be supplied by Embraer together
            with each Aircraft at delivery. Such publications are issued under
            the applicable specification and are available in hard copies [*],
            and subsequently at a nominal fee. Such publications, to the extent
            not previously supplied by Embraer, will be delivered together with
            the Aircraft.

      b.    VENDOR ITEMS PUBLICATIONS - With respect to vendor items installed
            in the Aircraft which have their own publications, Chautauqua will
            receive them in the quantity specified in item "3" of Attachment
            "B", in their original content and printed form, directly from the
            suppliers, which are also responsible to keep them continuously
            updated through a direct communication system with Chautauqua.

16.   ASSIGNMENT AND GUARANTEE

      a.    Buyer or Chautauqua may request, and Embraer will take, any action
            reasonably necessary for the purpose of causing an Aircraft and
            Spares at the time of

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            delivery to be subject to an equipment trust conditional sale, lien
            or other arrangement for the initial financing of the Aircraft and
            Spares in connection with the delivery of such Aircraft and Spares
            to Chautauqua.

      b.    Except as expressly permitted by this Article 16, Buyer's rights and
            obligations hereunder may not be assigned, conveyed, subcontracted,
            transferred or delegated, without Embraer's prior written consent.

      c.    Chautauqua shall guarantee the obligations of Buyer hereunder
            pursuant to a guarantee in the form attached hereto as Attachment H,
            and it shall be a breach of this Agreement by Buyer if such
            guarantee is at any time not effective in accordance with its terms
            or if Chautauqua breaches, defaults, or fails to perform under such
            guarantee.

17.   RESTRICTIONS AND PATENT INDEMNITY

      This sale does not include the transfer of designs, copyrights, patents,
      and other similar rights to Buyer. Subject to Buyer's or Chautauqua's duty
      to promptly advise Embraer of any alleged copyright or patent
      infringement, Embraer shall indemnify, defend, protect and hold Buyer and
      Chautauqua (including respective officers, controlling persons, employees
      and directors) harmless with respect to any claims, suits actions,
      judgments, liabilities, damages and costs, including reasonable attorney
      fees, made against it or them if the Aircraft or Spares with Embraer part
      numbers infringes copyright patents or the proprietary rights of others.
      In such event Embraer shall to the extent necessary and as promptly as
      possible at its sole option and expense either

      (i)   procure for Buyer or Chautauqua the right under patent to use the
            system, accessory or equipment or part;

      (ii)  replace such system accessory, equipment or part with such
            non-infringing item or part; or

      (iii) modify such system, accessory, equipment or part to make it
            non-infringing.

18.   MARKETING PROMOTIONAL RIGHTS

      Embraer shall have the right to show for marketing purposes, free of any
      charge, the image of the Aircraft, painted with Buyer's colors and emblems
      or the colors and emblems of Chautauqua, affixed in photographs, drawings,
      films, slides, audiovisual works, models or any other medium of expression
      (pictorial, graphic, and sculptural works), through all mass
      communications media such as billboards, magazines, newspaper, television,
      movie, theaters, as well as in posters, catalogues, models and all other
      kinds of promotional material. In the event such Aircraft is sold to or
      operated by or for another company or person, Embraer shall be entitled to
      disclose such fact, as well as to continue to show the image of the
      Aircraft, free of any charge, for marketing purposes, either with the
      original or the new colors and

<Page>

      emblems, unless otherwise notified by Buyer or Chautauqua, provided that
      such notification shall be subject to the reasonable satisfaction and
      agreement of Embraer. If accepted, said prohibition, however, shall in no
      way apply to the promotional materials or pictorial, graphic or sculptural
      works already existing or to any contract for the display of such
      materials or works already binding Embraer at the time of receipt of the
      notification. The provisions of this Article shall be included in all
      future sales or lease agreements concerning the Aircraft.

19.   TAXES

      [*]

20. APPLICABLE LAW

      This Agreement, and the rights and obligations of the Parties hereunder,
      shall in all respects be governed by, and construed and interpreted in
      accordance with, the laws of the State of New York (excluding conflicts of
      law principles), and including all matters of construction, validity and
      performance.

21.   ARBITRATION

      a.    The Parties each irrevocably submit to the exclusive jurisdiction of
            arbitration and expressly and irrevocably waive its right to bring
            suit against the other party in any court of law except for the
            limited purposes of enforcing an arbitral award obtained with
            respect to a dispute, or for obtaining any injunctive, temporary or
            preventative order or similar order available to it under the laws
            of any jurisdiction for a breach or threatened breach by the other
            party of this Agreement which threatens irreparable damage.

      b.    Any dispute submitted for arbitration must be finally settled by
            binding and confidential arbitration according to the Rules of the
            American Arbitration Association (the "Rules"), except as may be
            modified by mutual agreement of Embraer and Buyer. The arbitration,
            including the rendering of the award, will be conducted by
            arbitrators (selected as set forth below) who are fluent in the
            English language. The arbitration proceeding will be conducted with
            discovery in accordance with the Federal Rules of Civil Procedure.
            The arbitrators will be appointed in accordance with the Rules
            except as otherwise provided for herein.

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            The arbitration proceedings will take place in New York, New York,
            and will be conducted in the English language.

      c.    The Arbitrator will be selected as follows: within fifteen (15)
            Business Days of the referral of any matter to arbitration, each
            party will select an arbitrator. Thereafter, within fifteen (15)
            Business Days of each party's selection of an arbitrator, the two
            arbitrators selected by the Parties shall meet to select a mutually
            agreeable third arbitrator. In the event a party fails to select an
            arbitrator with in the time period specified above, the party that
            has timely complied with the selection of an arbitrator shall select
            a second arbitrator. These two arbitrators shall within seven (7)
            Business Days after the time in which the other party should have
            selected an arbitrator, meet to select a mutually agreeable third
            arbitrator. These three arbitrators shall comprise the arbitral
            panel and all arbitral proceedings shall be conducted in the
            presence of all three arbitrators.

      d.    If there is a dispute submitted to arbitration, any subsequent
            additional disputes referred for arbitration (including
            counterclaims between the parties) will be consolidated in the same
            arbitration proceeding.

      e.    The arbitral proceeding will not exceed one hundred (100) days
            commencing on the date the last arbitrator accepts his or her
            appointment. If the arbitral award is not issued within this time,
            then the arbitration proceeding will be automatically renewed for
            another one hundred (100) days. Evidence may not be taken in the
            arbitral proceeding except in the presence of both parties and all
            witnesses, if any , may be questioned by both parties. The only
            evidence which may be considered by the arbitrators in reaching
            their decision is that which is otherwise admissible in accordance
            with the then current United States Federal Rules of Evidence.

      f.    Any decision or award of the arbitrators must be based solely on the
            terms of this Agreement and the substantive governing law applicable
            to this Agreement. The decision of the arbitrators must be issued in
            writing with an explanation of its reasoning, and will be final and
            conclusive when issued. Judgment upon the award rendered in the
            arbitration may be entered and enforced by the Court specified in
            Article 21.g. hereof.

      g.    Each party irrevocably submits to the exclusive jurisdiction of the
            United States District Court for the Southern District of New York
            sitting in the County of New York for purposes of enforcing any
            arbitral award or for other legal proceedings arising out of this
            Agreement or any transactions contemplated in this Agreement as
            provided for herein. However nothing contained in this Agreement
            shall be deemed to prevent either party from enforcing any decision
            of the United States District Court for the Southern District of New
            York sitting in the County of New York for purposes of enforcing or
            collecting any such award in any court or jurisdiction as such party
            deems necessary or prudent.

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      h.    Each party shall bear its own costs and expenses of arbitration. The
            parties shall share equally the costs, expenses and fees of any
            arbitral panel designated pursuant to this Agreement.

22.   SOVEREIGN IMMUNITY, VENUE AND FORUM NON CONVENIENCE

      Embraer, under the laws of the United States or of any other jurisdiction
      affecting Embraer, is subject to private commercial law and suit, and is
      not entitled to sovereign immunity under any such laws, for its
      performance of its obligations under this Agreement. Embraer's performance
      of its obligations hereunder constitute commercial acts done for
      commercial purposes. The parties hereto furthermore waive to the extent
      permitted by law any objections to venue of the United States District
      Court for the Southern District of New York sitting in the County of New
      York for purposes of enforcing any arbitral award and any right or claim
      to any transfer or dismissal of any enforcement proceeding in the United
      States District Court for the Southern District of New York sitting in the
      County of New York on the grounds of forum non convenience.

23.   TERMINATION

      [*]

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      [*]

      b.1 [*]

      c. [*]

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      [*]

      d. [*]

      e. [*]

24.   OPTION FOR THE PURCHASE OF ADDITIONAL EMB-145 AIRCRAFT

      [*]

                 -----------------------------------------
                   37            EMB-145           DEC03
                 -----------------------------------------

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Under no circumstances shall Buyer be obligated to accept Aircraft more than
seven (7) Business Days prior to the relevant Contractual Delivery Date.

      [*]

      a.    INITIAL DEPOSIT: [*]

      b.    BASIC PRICE: [*] unless otherwise modified by the Parties and the
            costs for such changes shall be in addition to the Basic Price.

      c.    ESCALATION: [*]

      d.    DEPOSIT AND PROGRESS PAYMENTS: The payment of the price specified
            in item "b" above, shall be made according to the following:

            1. [*]

            2. [*]

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            3.    [*]

            4.    [*]

            5.    The balance of each relevant Option Aircraft escalated price
                  is due and payable upon acceptance of each relevant Aircraft
                  by Buyer.

      e.    [*]

      f.    [*]

      g.    SERVICES: The services Embraer will provide pursuant to Article 13
            in regard to the Option Aircraft which will be delivered pursuant to
            this Article 24 shall be in accordance with Article 13.e.1 - 4
            above.

25.   INDEMNITY

      Buyer agrees to indemnify and hold harmless Embraer and Embraer's
      officers, agents, employees and assignees from and against all
      liabilities, damages, losses, judgments, claims and suits, including costs
      and expenses incident thereto, which may be suffered by, accrued against,
      be charged to or recoverable from Embraer and/or Embraer's officers,
      agents, employees and assignees by reason of loss or

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      damage to property or by reason of injury or death of any person
      (excluding Embraer's officers, directors, employees or agents) resulting
      from or in any way connected with the performance of services by
      employees, representatives or agents of Embraer for or on behalf of Buyer
      related to Aircraft delivered by Embraer to Buyer or Chautauqua,
      including, but not limited to, technical operations, maintenance, and
      training services and assistance performed while on the premises of
      Embraer, Chautauqua, or Buyer, while in flight on Aircraft after Actual
      Delivery or while performing any other service, at any place, in
      conjunction with the Aircraft [*]

26.   NOTICES

      All notices permitted or required hereunder shall be in writing in the
      English language and sent, by registered mail, express courier or
      facsimile, to the attention of the Director of Contracts as to Embraer and
      of the President as to Buyer, to the addresses indicated below or to such
      other address as either party may, by written notice, designate to the
      other. In the event notice is issued by registered mail or express
      courier, it shall be deemed received on the day on which the party
      receiving such notice executes the delivery receipt. In the event notice
      is issued by facsimile, it shall be deemed received on the day on which
      the sender of such notice receives a facsimile confirmation receipt of
      such facsimile notice.

      a.    Embraer:

      EMBRAER - Empresa Brasileira de Aeronautica S.A.
      Av. Brigadeiro Faria Lima, 2170
      12.227-901 Sao Jose dos Campos - SP
      BRAZIL
      Attention:  Director of Contracts
      Telephone:  (55-12) 3927-1410
      Facsimile:  (55-12) 3927-1257

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         b. Buyer

         Republic Airways Holdings, Inc.
         2500 S. High School Road
         Indianapolis, Indiana  46241

         Attention:  President
         Tel:   317-484-6047
         Fax:  317-484-6060

         With a Copy to:

         Wexford Capital LLC
         411 West Putnam Avenue
         Greenwich, Connecticut  06830
         Attention:  Jay Maymudes
         Tel:  203-862-7050
         Fax:  203-862-7350

27.   CONFIDENTIALITY

      Neither Party shall have the right to disclose the terms of this Agreement
      except as required by law. To the fullest extent permitted by law, except
      as aforesaid, neither Party shall disclose any portion of this Agreement
      or its Attachments, amendments or any other supplement, to any third
      party, other than to its accountants, attorneys, agents, consultants or
      permitted assignees without the other Party's prior written consent, and
      any such accountants, attorneys, agents consultants or permitted assignees
      shall agree in writing to be bound by the terms of this Article 27.
      Without limiting the foregoing, in the event either Party is legally
      required to disclose the terms of this Agreement, the Parties agree to
      exert their reasonable best efforts to request confidential treatment of
      the clauses and conditions of this Agreement relevantly designated by
      either Party as confidential. Without limiting its obligations pursuant to
      the preceding sentence, Buyer agrees that if it is required, in the
      opinion of counsel, to file publicly or otherwise disclose the terms of
      this Agreement under applicable federal and/or state securities or other
      laws, it shall promptly (but in no case less than ten (10) Business Days
      prior to the proposed filing in question) notify Embraer so that Embraer
      has a reasonable opportunity to contest or limit the scope of such
      required disclosure, and Buyer shall request, and shall use its best
      reasonable efforts to obtain, confidential treatment for such sections of
      this Agreement as Embraer may designate. Buyer further agrees that it
      shall not in any circumstances file publicly or otherwise disclose the
      terms of this Agreement under applicable federal and/or state securities
      or other laws if it has not complied with its obligations pursuant to the
      previous sentence. Embraer shall have the right to

<Page>

      terminate this Agreement pursuant to Article 23.c if Buyer fails to comply
      with its obligations pursuant to the previous two sentences (e.g., to
      notify Embraer that Buyer is required to file or otherwise disclose terms
      of this Agreement, to request and use its best reasonable efforts to
      obtain confidential treatment of sections designated by Embraer as
      confidential, or to file publicly or otherwise disclose the terms of this
      Agreement if it has not complied with its obligations).

28.   INTEGRATED AGREEMENT

      All Attachments referred to in this Agreement and attached hereto are, by
      such reference and attachment, incorporated in this Agreement. This
      Agreement, including all Attachments and all amendments, modifications and
      supplements, is herein and hereinafter called the "Agreement" or the
      "Purchase Agreement".

29.   NEGOTIATED AGREEMENT

      This Agreement, including all of its Attachments, has been the subject of
      discussion and negotiation and is fully understood by the Parties, and the
      rights, obligations and other agreements of the Parties contained in this
      Agreement are the result of complete discussion and negotiation between
      the Parties.

30.   COUNTERPARTS

      This Agreement may be signed by the Parties in any number of separate
      counterparts with the same effect as if the signatures thereto and hereto
      were upon the same instrument and all of which when taken together shall
      constitute one and the same instrument.

31.   ENTIRE AGREEMENT

      This Agreement constitutes the entire agreement of the Parties with
      respect to the sale described as its subject and supersedes all previous
      and connected negotiations, representations and agreements between the
      Parties. This Agreement may not be altered, amended or supplemented except
      by a written instrument executed by the Parties.

32.   NO WAIVER

      Any Party's forbearance from exercising any claim or remedy provided for
      herein shall not be deemed a waiver of such claim or remedy, and shall not
      relieve the other Party from the performance of such obligation at any
      subsequent time or from the performance of any of its other obligations
      hereunder. Buyer acknowledges that Embraer has not waived any rights it
      may have against Buyer, Chautauqua or Solitair Corp., arising out of any
      acts before the date this Purchase Agreement becomes effective.

<Page>

33.   REPRESENTATIONS AND WARRANTIES

      A. Effective as of the date of this Agreement and as of the Actual
      Delivery Date of each Aircraft, Embraer represents and warrants that:

      1.    Embraer is a corporation duly organized, validly existing and in
            good standing under the laws of Brazil, is the manufacturer of the
            EMB-145LR model aircraft and has all necessary corporate power and
            authority to conduct the business in which it is currently engaged
            and to enter into and perform its obligations under this Agreement.

      2.    Embraer has taken, or caused to be taken, all necessary corporate
            action to authorize the execution and delivery of this Agreement and
            the performance of its obligations hereunder.

      3.    The execution and delivery by Embraer of this Agreement, the
            performance by Embraer of its obligations hereunder and the
            consummation by Embraer of the transactions contemplated hereby, do
            not and will not (A) violate or conflict with any provision of the
            constitutional documents of Embraer, (B) violate or conflict with
            any law, rule, or regulation applicable to or binding on Embraer or
            (C) violate or constitute any breach or default (other than a breach
            or default that would not (x) result in a material adverse change to
            Embraer or (y) adversely affect Embraer's ability to perform any of
            its obligations hereunder),under any agreement, instrument or
            document to which Embraer is a party or by which Embraer or any of
            its properties is or may be bound or affected.

      4.    The execution and delivery by Embraer of this Agreement, the
            performance by Embraer of its obligations hereunder and the
            consummation by Embraer of the transactions contemplated hereby do
            not and will not require the consent, approval or authorization of,
            or the giving of notice to, or the registration with, or the
            recording or filing of any documents with, or the taking of any
            other action in respect of, (A) any trustee or other holder of any
            indebtedness or obligation of Embraer, (B) any national, state or
            municipal government regulatory, judicial, or administrative entity
            of competent jurisdiction, or (C) any other party.

      5.    This Agreement has been duly authorized, executed and delivered by
            Embraer and, assuming the due authorization, execution and delivery
            hereof by the other Party constitutes the legal, valid and binding
            obligation of Embraer enforceable against Embraer in accordance with
            the terms hereof, except as such enforceability may be limited by
            bankruptcy, insolvency, reorganization, receivership, moratorium and
            other similar laws affecting the rights of creditors generally and
            general principles of equity, whether considered in a proceeding at
            law or in equity.

<Page>

      6.    Each of the foregoing representations and warranties shall survive
            the execution and delivery of this Agreement and any termination
            hereof.

B.    Effective as of the date of this Agreement and as of the Actual Delivery
      Date of each Aircraft, Buyer represents and warrants that:

      1.    Buyer is a corporation duly organized, validly existing and in good
            standing under the laws of the State of Delaware and has all
            necessary corporate power and authority to conduct the business in
            which it is currently engaged and to enter into and perform its
            obligations under this Agreement.

      2.    Buyer has taken, or caused to be taken, all necessary corporate
            action to authorize the execution and delivery of this Agreement and
            the performance of its obligations hereunder.

      3.    The execution and delivery by Buyer of this Agreement, the
            performance by Buyer of its obligations hereunder and the
            consummation by Buyer of the transactions contemplated hereby, do
            not and will not (A) violate or conflict with any provision of the
            constitutional documents of Buyer, (B) violate or conflict with any
            law, rule, or regulation applicable to or binding on Buyer or (C)
            violate or constitute any breach or default (other than a breach or
            default that would not (x) result in a material adverse change to
            Buyer or (y) adversely affect Buyer's ability to perform any of its
            obligations hereunder),under any agreement, instrument or document
            to which Buyer is a party or by which Buyer or any of its properties
            is or may be bound or affected.

      4.    The execution and delivery by Buyer of this Agreement, the
            performance by Buyer of its obligations hereunder and the
            consummation by Buyer of the transactions contemplated hereby do not
            and will not require the consent, approval or authorization of, or
            the giving of notice to, or the registration with, or the recording
            or filing of any documents with, or the taking of any other action
            in respect of, (A) any trustee or other holder of any indebtedness
            or obligation of Buyer, (B) any national, federal, state or local
            government regulatory, judicial, or administrative entity of
            competent jurisdiction (other than recordation of the Aircraft with
            FAA) or (C) any other party.

      5.    This Agreement has been duly authorized, executed and delivered by
            Buyer and, assuming the due authorization, execution and delivery
            hereof by the other Party constitutes the legal, valid and binding
            obligation of Buyer enforceable against Buyer in accordance with the
            terms hereof, except as such enforceability may be limited by
            bankruptcy, insolvency, reorganization, receivership, moratorium and
            other similar laws affecting the rights of creditors generally and
            general principles of equity, whether considered in a proceeding at
            law or in equity.

      6.    Each of the foregoing representations and warranties shall survive
            the execution and delivery of this Agreement and any termination
            hereof.

<Page>

34.   EFFECTIVENESS

      A. This Agreement shall become effective at the time all of the following
      events have occurred: (a) it is signed by an authorized officer of Buyer
      and executed by two authorized officers of Embraer; [*]

      B. At the time this Agreement becomes effective, neither Buyer nor Embraer
      shall have any rights or obligations to the other pursuant to the Original
      Purchase Agreement except as expressly restated herein.

      [*]

      [*]

----------
* Confidential

<Page>

[*]

[*]

[*]

[*]

----------
* Confidential

<Page>

      E. [*]

----------
* Confidential

<Page>

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed
and delivered by their proper and duly authorized officers and to be effective
as of the day and year first above written.

     EMBRAER - EMPRESA BRASILEIRA                REPUBLIC AIRWAYS HOLDINGS, INC.
        DE AERONAUTICA S.A.

By:  /s/ Frederico Fleury Curado               By:  /s/ Bryan Bedford
    ____________________________                    ____________________________
Name: Frederico Fleury Curado                  Name: Bryan Bedford
      __________________________                     ___________________________
Title: E.V.P. Airline Market                   Title: President
       _________________________                      __________________________

By: /s/ Flavio Rimoli
   ___________________________
Name: Flavio Rimoli
      ________________________
Title: Director of Centro C&S
       _______________________

Date: April 19, 2002                             Date: April 19, 2002
     _________________________                        __________________________
Place:________________________                   Place:_________________________

Witness: /s/ Fernando Beuvo                      Witness: /s/ Robert H. Cooper
        ______________________                           _______________________
Name: Fernando Beuvo                             Name: Robert H. Cooper
      ________________________                        __________________________

<Page>

------------------------------------------------------------------------------
                                ATTACHMENT "A-1"
                     AIRCRAFT UNDER US AIRWAYS CONFIGURATION
------------------------------------------------------------------------------

      AIRCRAFT SPECIFIC CONFIGURATION, FINISHING AND REGISTRATION MARKS
      ------------------------------------------------------------------

1.    STANDARD AIRCRAFT

      The Aircraft shall be manufactured according to the standard configuration
      specified in the Technical Description TD-145/010, dated January 1998
      (Appendix I) (the "Technical Description") and the optional equipment
      described in item 2 below.

[*]

      [*]

                [*]

      [*]

                [*]

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* Confidential

<Page>

      [*]
            [*]
                  [*]

3.    FINISHING

      a.    EXTERIOR FINISHING:

            The Aircraft shall be painted according to the US Airways color and
            paint scheme, which has been supplied to Embraer by Buyer.

      b.    INTERIOR FINISHING:

            Buyer has informed Embraer of its choice of materials and colors of
            all and any item of interior finishing such as seat covers, carpet,
            floor lining on galley areas, side walls and overhead lining, galley
            lining and curtain. In case Buyer elects to use different materials
            and or patterns, such schedule shall be agreed between the Parties
            at the time of signature of this Purchase Agreement.

4.    REGISTRATION MARKS

      The Aircraft shall be delivered to Buyer with the registration marks
      painted on them, which shall be supplied to Embraer by Buyer no later than
      ninety (90) days before each relevant Aircraft Contractual Delivery Date.

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* Confidential

<Page>

     IF THERE IS ANY CONFLICT BETWEEN THE TERMS OF THIS ATTACHMENT "A-1" AND THE
     TERMS OF THE TECHNICAL DESCRIPTION, THE TERMS OF THIS ATTACHMENT "A-1"
     SHALL PREVAIL.

<Page>

------------------------------------------------------------------------------
                                ATTACHMENT "A-2"
                    AIRCRAFT UNDER AMERICA WEST CONFIGURATION
------------------------------------------------------------------------------

         AIRCRAFT SPECIFIC CONFIGURATION, FINISHING AND REGISTRATION MARKS
         -----------------------------------------------------------------

1.    STANDARD AIRCRAFT

      The Aircraft shall be manufactured according to the standard configuration
      specified in the Technical Description TD-145/010, dated January 1998
      (Appendix I) (the "Technical Description") and the optional equipment
      described in item 2 below.

2.    [*]

      [*]
            [*]

      [*]
            [*]

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* Confidential

<Page>

      [*]
            [*]

3.    FINISHING

      a.    EXTERIOR FINISHING:

            The Aircraft shall be painted according to the America West color
            and paint scheme, which has been supplied to Embraer by Buyer.

      b.    INTERIOR FINISHING:

            Buyer has informed Embraer of its choice of materials and colors of
            all and any item of interior finishing such as seat covers, carpet,
            floor lining on galley areas, side walls and overhead lining, galley
            lining and curtain. In case Buyer elects to use different materials
            and or patterns, such schedule shall be agreed between the Parties.

4.    REGISTRATION MARKS

      The Aircraft shall be delivered to Buyer with the registration marks
      painted on

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* Confidential

<Page>

      them, which shall be supplied to Embraer by Buyer no later than ninety
      (90) days before each relevant Aircraft Contractual Delivery Date.

      IF THERE IS ANY CONFLICT BETWEEN THE TERMS OF THIS ATTACHMENT "A-2" AND
      THE TERMS OF THE TECHNICAL DESCRIPTION, THE TERMS OF THIS ATTACHMENT "A-2"
      SHALL PREVAIL.

<Page>

------------------------------------------------------------------------------
                                 ATTACHMENT "B"
------------------------------------------------------------------------------

                                FERRY EQUIPMENT,
                                ----------------
                    SPARE PARTS POLICY AND LIST OF PUBLICATIONS
                    -------------------------------------------

1.       FERRY EQUIPMENT

         If it is necessary for any ferry equipment to be installed by Embraer
         for the ferry flight between Brazil and the United States of America,
         Embraer may provide such equipment to Buyer, for a price to be agreed
         between the Parties. In this case, Buyer shall immediately upon its
         arrival remove such ferry equipment from the Aircraft and turn it over
         to Embraer in Brazil at Buyer's own expense.

         If Embraer provides any ferry equipment to Buyer and if such equipment
         is utilized, for any reason, or if such equipment is not returned by
         Buyer, in Embraer's sole judgment, complete and in perfect condition,
         Buyer shall fully indemnify Embraer for the value of such equipment,
         provided that in case of partial utilization of, or damage to any such
         equipment, the value to be charged shall be the price of a new complete
         set of equipment.

         [*]

2.       SPARE PARTS

         2.0      [*]

                  [*]

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* Confidential

<Page>

[*]

         2.1      INITIAL PROVISIONING

                  The objective of the IPL is to provide Buyer with accurate
                  technical data supplied by Embraer, in order to enable an
                  adequate selection of spares, aiming to support initial
                  scheduled maintenance, based upon operational parameters
                  established by Chautauqua.

         2.2      PROVISIONING

                  [*]

         2.3      DATA

                  Initial provisioning data has been supplied Chautauqua upon
                  request.

                  2.3.1         INITIAL PROVISIONING DATA: Embraer has supplied
                                initial provisioning data.

                  2.3.2         PROVISIONING DATA REVISIONS: As requested, the
                                Chautauqua IPL will have the data updated by
                                incorporating engineering and price changes.
                                Embraer will maintain a master copy of the
                                Chautauqua IPL updated until ninety (90)
                                calendar days after delivery of the last
                                Aircraft.

         2.4      SPARE PARTS RECOMMENDATIONS

                  [*]

         2.5      DELIVERY OF SPARE PARTS

                  Except for those spare parts referred to in item 2.4. above,
                  Spare items (initial provisioning spare parts) are normally in
                  inventory and available for delivery on the Aircraft
                  Contractual Delivery Date. Nevertheless, delivery dates shall
                  be those agreed between the Parties in the Purchase

----------
* Confidential

<Page>

                  Agreement. Replenishment of Embraer made parts will be in
                  accordance with the lead times quoted by Embraer. Embraer will
                  deliver parts in FCA (Free Carrier - Incoterms 1990)
                  condition, at Sao Jose dos Campos, State of Sao Paulo, Brazil,
                  or at any other port of clearance that may be chosen by
                  Embraer and informed to Buyer.

         2.6      EMERGENCY SPARE PARTS SERVICE

                  Embraer will maintain an emergency spare parts service, twenty
                  four (24) hours a day, seven (7) days a week. [*]

         [*]

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* Confidential

<Page>

[*]

         2.8.     [*]

                  [*]

         2.9.     PARTS REPAIR PROGRAM

----------
* Confidential

<Page>

                  For any repair required by Chautauqua on any Embraer or vendor
                  repairable item, Embraer may assist Chautauqua to perform such
                  repair in order to ensure the shortest turn around time (TAT).

         2.10.    PRICING

                  Embraer will maintain a spare parts price list updated
                  periodically. Items not shown on the list will be quoted on
                  request.

3.       LIST OF PUBLICATIONS

         As provided for in Article 15 of this Agreement, the technical
         publications covering operation and maintenance shall be delivered to
         Buyer in accordance with the following list:

                                                                        QTY
       TITLE                                                        (COPIES)
       -----                                                        --------

OPERATIONAL

[*]

MAINTENANCE - BASIC SET

[*]

MAINTENANCE SUPPLEMENTARY SET

[*]

----------
* Confidential

<Page>

[*]

If Buyer elects not to take all or any one of the publications mentioned in this
Section 3, or revisions thereof, no refund or other financial adjustment of the
Basic Price will be made since such publications are offered at no cost to Buyer
as referred to in Article 15.a of the Purchase Agreement.

----------
* Confidential

<Page>

--------------------------------------------------------------------------------
                                 ATTACHMENT "C"
--------------------------------------------------------------------------------

            AIRCRAFT WARRANTY CERTIFICATE - MATERIAL AND WORKMANSHIP

1.   Embraer, subject to the conditions and limitations hereby expressed,
     warrants the Aircraft as follows:

     a.   For a period of forty-eight (48) months from the date of delivery to
          the first Buyer, each Aircraft will be free from:

          -    Defects in materials, workmanship and manufacturing processes in
               relation to parts manufactured by Embraer or by its
               subcontractors holding an Embraer part number;

          -    Defects inherent to the design of the Aircraft and its parts
               designed or manufactured by Embraer or by its subcontractors
               holding an Embraer part number.

     b.   For a period of thirty-six (36) months from the date of delivery to
          the first Buyer, the Aircraft will be free from:

          -    Defects in operation of vendor (Embraer's supplier) manufactured
               parts, not including the Engines, Auxiliary Power Unit (APU) and
               their accessories, as well as failures of mentioned parts due to
               incorrect installation or installation not complying with the
               instructions issued or approved by their respective
               manufacturers.

          -    Defects due to non-conformity to the Technical Description Number
               TD 145 /010 dated January 1998 as may be amended by Buyer's
               Aircraft Technical Specification referred to in Article 1.b of
               the Purchase Agreement of the Aircraft.

     Once the above mentioned periods have expired, Embraer will transfer to
     Buyer the original warranty issued by the vendors, if it still exists.

2.   Embraer, subject to the conditions and limitations hereby expressed,
     warrants that:

     a.   All spare parts which have been manufactured by Embraer or by its
          subcontractors holding an Embraer part number, and by vendors which
          will permit their particular identification and which have been sold
          by Embraer or its representatives will, for a period of twenty four
          (24) months from the date of delivery of such spares to Buyer, be free
          from defects of material,

--------------------------------------------------------------------------------
Amended and Restated EMB-145LR Purchase Agreement                    Page 1 of 4
DCT-025/98 - Attachment C 45167443_3.DOC

<PAGE>

          workmanship, manufacturing processes and defects inherent to the
          design of the above mentioned parts.

     b.   All ground support equipment, which has been designed and manufactured
          by Embraer or by its subcontractors holding an Embraer part number and
          by vendors, not including Engines, APU and their accessories, and
          stamped with a serial number which will permit their particular
          identification and which have been sold by Embraer or its
          representatives will, for a period of twelve (12) months from the date
          of delivery to Buyer of said equipment, be free from malfunction,
          defect of material and manufacture.

3.   The obligations of Embraer as expressed in this warranty and as specified
     in Article 11.e are limited to replacement, repair or rework of the
     defective item, depending solely upon Embraer's own judgment, of the parts
     that are returned to Embraer or its representatives within a period of
     sixty (60) days after the occurrence of the defect, at Buyer's own expense
     (including but not limited to, freight, insurance, taxes and, customs
     duties), adequately packed, provided that such components are actually
     defective and that the defect has occurred within the periods stipulated in
     this certificate. Should the defective part not be shipped to Embraer
     within such sixty (60) days period, Embraer may in its sole discretion,
     deny the warranty claim. In the event that it is not practical in the
     international commercial transportation industry to return the part or
     component which is the subject of a warranty claim under this Attachment C,
     to Embraer, because of either its extremely large size or its relationship
     to the Airframe, then thirty (30) days after a defect is found in such
     structural component (hereafter referred to as "Structural Component"),
     Buyer shall send notice of such defect to Embraer and notwithstanding the
     above, Buyer shall not be obligated to return such Structural Component to
     Embraer. Embraer shall thereafter send an appropriate inspection team to
     Buyer's facilities to inspect the Structural Component for the alleged
     defect. In the event that Embraer in its sole judgment finds the Structural
     Component defective, it shall either repair, rework, or replace the
     defective Structural Component.

     Notification of any defect claimed under three (3) above must be given to
     Embraer within thirty (30) calendar days after such defect is found.

     Parts supplied to Buyer as replacement for defective parts are warranted
     for the balance of the warranty period still available from the original
     warranty of the exchanged parts. However, freight, insurance, taxes and
     other costs eventually incurred during the shipment to Embraer or its
     representative, re-installation and adjustments are Buyer's responsibility.

4.   Embraer will accept no warranty claims under any of the circumstances
     listed below unless it can be demonstrated in accordance with the standards
     of the

--------------------------------------------------------------------------------
                                                                     Page 2 of 4

<PAGE>

     international aircraft manufacturing industry that such operation or
     maintenance or other circumstance did not cause the defect:

     a.   When the Aircraft has been used in an attempt to break records, or
          subjected to experimental flights, or in any other way not in
          conformity with the flight manual or the airworthiness certificate, or
          subjected to any manner of use in contravention of the applicable
          aerial navigation or other regulations and rules, issued or
          recommended by government authorities of whatever country in which the
          aircraft is operated, when accepted and recommended by I.C.A.O.;

     b.   When the Aircraft or any of its parts have been altered or modified by
          Buyer, without prior approval from Embraer or from the manufacturer of
          the parts through a service bulletin;

     c.   Whenever the Aircraft or any of its parts have been involved in an
          accident, or when parts either defective or not complying to
          manufacturer's design or specification have been used;

     d.   Whenever parts have had their identification marks, designation, seal
          or serial number altered or removed;

     e.   In the event of negligence, misuse or maintenance services done on the
          Aircraft, or any of its parts not in accordance with the respective
          maintenance manual;

     f.   In cases of deterioration, wear, breakage, damage or any other defect
          resulting from the use of inadequate packing methods when returning
          items to Embraer or its representatives.

5.   The warranty hereby expressed does not apply to defects presented by
     expendable items, whose service life or maintenance cycle is lower than the
     warranty period, and to materials or parts subjected to deterioration.

6.   The warranty hereby expressed is established between Embraer and the first
     Buyer, and it cannot be transferred or assigned to others, unless by
     written consent of Embraer, or as otherwise provided for pursuant to
     Article 16 of the Purchase Agreement of which this is an Attachment.

7.   THE WARRANTIES, OBLIGATIONS AND LIABILITIES OF EMBRAER AND REMEDIES OF
     BUYER SET FORTH IN THIS WARRANTY CERTIFICATE ARE EXCLUSIVE AND IN
     SUBSTITUTION FOR, AND BUYER HEREBY WAIVES, RELEASES AND RENOUNCES, ALL
     OTHER WARRANTIES, OBLIGATIONS AND LIABILITIES OF EMBRAER AND ANY ASSIGNEE
     OF EMBRAER AND ALL

--------------------------------------------------------------------------------
                                                                     Page 3 of 4

<PAGE>

     OTHER RIGHTS, CLAIMS AND REMEDIES OF BUYER AGAINST EMBRAER OR ANY ASSIGNEE
     OF EMBRAER, EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE, WITH RESPECT
     TO ANY NON-CONFORMANCE OR DEFECT OR FAILURE OR ANY OTHER REASON IN ANY
     AIRCRAFT OR OTHER THING DELIVERED UNDER THE PURCHASE AGREEMENT OF WHICH
     THIS IS AN ATTACHMENT, INCLUDING DATA, DOCUMENT, INFORMATION OR SERVICE,
     INCLUDING BUT NOT LIMITED TO:

     a.   ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS;

     b.   ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, COURSE OF
          DEALING OR USAGE OF TRADE;

     c.   ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY IN TORT, WHETHER OR
          NOT ARISING FROM THE NEGLIGENCE OR OTHER RELATED CAUSES OF EMBRAER OR
          ANY ASSIGNEE OF EMBRAER, WHETHER ACTIVE, PASSIVE OR IMPUTED; AND

     d.   ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY FOR LOSS OF OR
          DAMAGE TO ANY AIRCRAFT, FOR LOSS OF USE, REVENUE OR PROFIT WITH
          RESPECT TO ANY AIRCRAFT OR FOR ANY OTHER DIRECT, INCIDENTAL OR
          CONSEQUENTIAL DAMAGES.

8.   No representative or employee of Embraer is authorized to establish any
     other warranty than the one hereby expressed, nor to assume any additional
     obligation, relative to the matter, in the name of Embraer and therefore
     any such statements eventually made by, or in the name of Embraer, shall be
     void and without effect.

9.   Provided the provisions hereof are still effective in accordance with their
     terms, then Buyer may assign Buyer's rights pursuant to this warranty to
     any entity (but for entities or air carriers which are owned, effectively
     controlled or managed by any other airframe manufacturer which competes in
     the thirty seven (37) to seventy (70) seat turbo jet market ("Transferee"))
     provided Buyer notifies Embraer of the identity of such Transferee at least
     thirty (30) calendar days prior to such transaction. In the event such
     Transferees or Other Transferees (as defined herein) subsequently transfer
     any Aircraft or Spares, any Transferees' or Other Transferees' rights which
     remain pursuant to this Warranty with respect to such Aircraft and Spares
     may also be transferred to any other entity (but for entities or air
     carriers which are owned, effectively controlled or managed by any other
     airframe manufacturer which competes in the thirty seven (37) to seventy
     (70) seat turbo jet market ("Other Transferees")) provided that the
     Transferees or Other Transferees notify Embraer of the identity of such
     other entity at least sixty (60) calendar days prior to such transaction.

--------------------------------------------------------------------------------
                                                                     Page 4 of 4

<Page>

------------------------------------------------------------------------------
                                  ATTACHMENT D
------------------------------------------------------------------------------

                                   AIRCRAFT
                                   --------
                              ESCALATION FORMULA
                              -------------------

                                       [*]

[*]

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* Confidential

<Page>

                                  ATTACHMENT E
                                  ------------
                    APPOINTMENT OF AUTHORIZED REPRESENTATIVE
                    --------------------------------------

         ("Buyer") hereby designates and appoints _________________ as the
authorized representative of Buyer for the purpose of inspecting, reinspecting,
and accepting delivery from EMBRAER-Empresa Brasileira de Aeronautica S.A.
("Embraer"), on behalf of and in the name of Buyer, of the Embraer Model
EMB-145/EMB-135KL aircraft having Manufacturer's Serial No. 145___ (including
the engines, appliances and parts installed thereon, the "Aircraft") and Spares,
as defined in that certain Amended and Restated Purchase Agreement GCT-025/1998
between Republic Airways Holdings, Inc. and EMBRAER dated April __, 2002, to be
delivered by Embraer to Buyer pursuant to the Purchase Agreement Assignment to
be dated as of or about ______ __, 200_ between Republic Airways Holdings, Inc.
and Buyer, including the authority to accept delivery of said Aircraft and
Spares, and to execute and deliver any additional documents with respect to the
delivery for said Aircraft and Spares in such form as such authorized
representative executing the same shall deem appropriate.

Dated:            __________ __, 200_

                                                       ______________

                                                    By:_______________________
                                                       Name:
                                                       Title:

The foregoing appointment
is hereby accepted

------------------------
Name:

<Page>

------------------------------------------------------------------------------
                                 ATTACHMENT "F"
------------------------------------------------------------------------------

                         FORM OF WARRANTY BILL OF SALE
                         -----------------------------

KNOW ALL MEN BY THESE PRESENTS THAT Embraer - Empresa Brasileira de Aeronautica
S.A. ("SELLER"), a Brazilian company, whose address Av. Brigadeiro Faria Lima,
2170 - Putim, Sao Jose dos Campos, Sao Paulo, Brazil, is the owner of good and
marketable title to that certain EMB-145 LR aircraft bearing Manufacturer's
Serial No. ___________, with all appliances, parts, instruments, appurtenances,
accessories, furnishings and/or other equipment or property incorporated in or
installed on or attached to said engine (hereinafter collectively referred to as
the "Aircraft") purchased by Republic Airways Holdings, Inc. ("BUYER") under the
Amended and Restated Purchase Agreement No. 025/98, dated as of _______ __,
2002, including Attachments, Exhibits, Letters, Amendments and Agreements by and
between SELLER and [BUYER].

THAT for and in consideration of the sum of US$ 10.00 and other valuable
consideration, receipt of which is hereby acknowledged, SELLER does this
__________ day of __________, 200_, grant, convey, transfer, bargain and sell,
deliver and set over to BUYER and unto its successors and assigns forever, all
of SELLER's rights, title and interest in and to the Aircraft.

THAT SELLER hereby represents and warrants to BUYER, its successors and assigns:

(i)   that SELLER has good and marketable title to the Aircraft and the good and
      lawful right to the Aircraft and the good and lawful right to sell the
      same; and

(ii)  that good and marketable title to the Aircraft is hereby duly vested in
      BUYER free and clear of all claims, liens, encumbrances and rights of
      others of any nature. SELLER hereby covenants and agrees to defend such
      title forever against all claims and demands whatsoever.

This Full Warranty Bill of Sale is governed by the laws of the state of New
York, United States of America.

IN WITNESS WHEREOF, SELLER has caused this instrument to be executed and
delivered by its duly authorized officer and attorney in fact.

Date as of ____________________, 200_.

EMBRAER - EMPRESA BRASILIERA DE AERONAUTICA S.A.

By:               ___________________________

Name:             ___________________________
Title:            ___________________________

<Page>

                              CHAUTAUQUA GUARANTY
                              -------------------

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Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00040-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00040-of-00352.parquet"}]]