Document:

SECURITIES PURCHASE AGREEMENT

     This SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated as of
September 29, 2003, is made by and among Midwest Express Holdings, Inc., a
Wisconsin corporation (the "Company"), with headquarters located at 6744 South
Howell Avenue, Oak Creek, WI 53154, and the investors named on the signature
pages hereto (each of whom is hereinafter referred to as the "Investor" and all
of whom collectively are hereinafter referred to as the "Investors").
Capitalized terms used herein and not otherwise defined have the meanings given
them in Article VIII.

                                   RECITALS:

     A. The Company and the Investors are executing and delivering this
Agreement in accordance with and in reliance upon the exemption from securities
registration afforded by Section 4(2) of the Securities Act of 1933, as amended
(the "Securities Act"), and Rule 506 under Regulation D ("Regulation D") as
promulgated by the United States Securities and Exchange Commission (the "SEC")
under the Securities Act.

     B. Contemporaneously with the execution and delivery of this Agreement, the
Company is entering into a Securities Purchase Agreement, dated September 29,
2003 (the "Note Purchase Agreement"), by and among the Company, Midwest
Airlines, Inc., a Wisconsin corporation and wholly-owned subsidiary of the
Company ("Midwest"), Skyway Airlines, Inc., a Delaware corporation and
wholly-owned subsidiary of Midwest, YX Properties, LLC, a Nebraska limited
liability company and an indirect subsidiary of the Company, and the investors
named on the signature pages to the Note Purchase Agreement (the "Note
Investors"), pursuant to which the Note Investors will purchase a new series of
convertible senior secured notes of the Company (together with any convertible
senior secured notes issued in replacement thereof in accordance with the terms
thereof, the "Notes").

     C. The Notes shall be convertible into shares of the Company's common
stock, par value $.01 per share (the "Common Stock").

     D. The Investors desire, upon the terms and conditions stated in this
Agreement, to purchase shares of Common Stock for an aggregate purchase price of
approximately $8,000,000. The purchase price per share of the Common Stock is
$4.25.

     E. At the Closing (as defined herein), the parties will execute and deliver
a Registration Rights Agreement under which the Company will agree to provide to
the Investors certain rights with respect to registration of the Common Stock
(and the associated Rights (as defined herein)) under the Securities Act and
applicable state securities laws.

                                   AGREEMENT:

     In consideration of the premises and the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Company and the Investors hereby agree as follows:

                                   ARTICLE I
                        PURCHASE AND SALE OF SECURITIES

     1.1. Purchase and Sale of Securities. At the Closing, subject to the terms
of this Agreement and the satisfaction or waiver of the conditions set forth in
Articles VI and VII, the Company will sell to each

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Investor, and each Investor will (on a several and not a joint basis) purchase
from the Company, the number of Securities (as defined herein) set forth beneath
such Investor's name on the signature pages hereof.

     1.2. Payment at Closing. On the Closing Date (as defined herein), each
Investor will pay the aggregate purchase price for the Securities as set forth
beneath its name on the signature pages hereof, by wire transfer of immediately
available funds in accordance with the written wire instructions set forth on
the signature page hereto of the Company, and the Company will deliver to each
Investor a certificate (bearing a restrictive legend as set forth in Section
2.8) representing the Securities so purchased by such Investor against delivery
of the purchase price therefor as described above.

     1.3. Closing Date. Subject to the satisfaction or waiver of the conditions
set forth in Articles VI and VII, the Closing will take place at 10:00 a.m.
Central Time on a date within five (5) Business Days (as defined herein) after
receipt of the Shareholder Approval referred to in Section 4.13, or at another
date or time agreed upon by each of the parties to this Agreement (the "Closing
Date"). The Closing will be held at the offices of the Company or at such other
place as the parties agree.

     1.4. Independent Nature. The rights and obligations of each Investor under
this Agreement are several and not joint with the rights and obligations of each
other Investor, and an Investor shall not be responsible in any way for the
performance of the obligations of any other Investor under this Agreement.
Nothing contained herein, and no action taken by any Investor pursuant hereto,
shall constitute the Investors as a partnership, an association, a joint venture
or any other kind of entity, or create a presumption that the Investors are in
any way acting as a "group" (within the meaning of Section 13(d) of the
Securities Exchange Act of 1934, as amended, the "Exchange Act") or in concert
with respect to such obligations or the transactions contemplated hereby. Each
Investor shall be entitled to independently protect and enforce its rights,
including without limitation the rights arising out of this Agreement, and it
shall not be necessary for the other Investors to be joined as an additional
party in any proceeding for such purposes.

                                   ARTICLE II
                    INVESTOR'S REPRESENTATIONS AND WARRANTIES

     Each Investor represents and warrants to the Company, severally and solely
with respect to itself and its purchase hereunder and not with respect to any
other Investor, that:

     2.1. Investment Purpose. The Investor is purchasing the Securities for its
own account and not with a view to the distribution thereof; provided, however,
that by making the representation herein, the Investor reserves the right to
dispose of the Securities in accordance with or pursuant to an effective
registration statement or an exemption from registration under the Securities
Act. The Investor understands that the Investor may be required to bear the
economic risk of this investment indefinitely, unless the Securities are
registered pursuant to the Securities Act and any applicable state securities or
blue sky laws or an exemption from such registration is available. The Investor
further represents that it does not have any contract, undertaking, agreement or
arrangement with any person or entity to sell, transfer or grant participation
to any third person or entity with respect to any of the Securities; provided,
however, that by making the representations herein, the Investor does not agree
to hold any Securities for any minimum or other specific term and reserves the
right to dispose of the Securities at any time in accordance with or pursuant to
a registration statement or an exemption under the Securities Act.

     2.2. Investor Status. The Investor is either: (i) a "qualified
institutional buyer" as defined in Rule 144A under the Securities Act; or (ii)
an institutional "accredited investor" as defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D (referred to herein as an "institutional accredited
investor"). The Investor is not registered as a broker or dealer under Section
15(a) of the Exchange Act, or a member of the National Association of Securities
Dealers, Inc. If an Investor is subject to the Employee Retirement Income
Security Act of 1974, as amended, and is acquiring the Securities as a fiduciary
or agent for another investor's

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account, then the Investor will have sole investment and voting discretion with
respect to such account and will have full power to make the acknowledgments,
representations and agreements contained herein on behalf of such account.

     2.3. Reliance on Exemptions. The Investor understands that the Securities
are being offered and sold to it in reliance upon specific exemptions from the
registration requirements of the United States federal and state securities laws
and that the Company is relying upon the truth and accuracy of, and the
Investor's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Investor set forth herein to determine
the availability of such exemptions and the eligibility of the Investor to
acquire the Securities.

     2.4. Information. The Investor and its advisors, if any, have been
furnished with all materials relating to the business, finances and operations
of the Company and its subsidiaries, and materials relating to the offer and
sale of the Securities, that have been requested by the Investor or its
advisors, if any. The Investor and its advisors, if any, have been afforded
adequate opportunity to ask questions of, and receive answers from, the Company.
The Investor acknowledges and understands that its investment in the Securities
involves a significant degree of risk, including the risks reflected in the
Company's Confidential Information Memorandum, dated August 1, 2003, delivered
to each Investor (the "CIM"), and the SEC Documents (as defined herein). The
foregoing representations shall not in any way amend, limit or modify the
representations and warranties of the Company set forth in Article III or the
Registration Rights Agreement (as defined herein) nor in any way affect the
Investor's right to rely on such representations and warranties.

     2.5. Experience. If the Investor made the investment decision relating to
the investment in the Securities on its own behalf, then the Investor has such
knowledge and experience in financial, business and investment matters,
including the airline industry and businesses and operations of companies that
operate in lines of business similar to the Company, that the Investor believes
it is capable of evaluating the terms and conditions, merits and risks of the
transactions described herein and the investment contemplated hereby, and the
Investor is familiar with the risks associated with such industry and businesses
and has the ability to bear the economic risks of the investment in the
Securities. If an advisor made the investment decision relating to the
investment in the Securities on behalf of the Investor, then the advisor has
such knowledge and experience in financial, business and investment matters,
including the airline industry and businesses and operations of companies that
operate in lines of business similar to the Company, that the advisor believes
it is capable of evaluating the terms and conditions, merits and risks of the
transactions described herein and the investment contemplated hereby, and the
advisor is familiar with the risks associated with such industry and businesses
and believes the Investor has the ability to bear the economic risks of the
investment in the Securities.

     2.6. Governmental Review. The Investor understands that no United States
federal or state agency or any other government or governmental agency has
passed upon or made any recommendation or endorsement of the Securities or an
investment therein.

     2.7. Transfer or Resale. The Investor understands that:

          (a) the delivery of the Securities has not been registered under the
     Securities Act or any applicable state securities laws, and consequently,
     the Investor may have to bear the risk of owning the Securities for an
     indefinite period of time because the Securities may not be transferred
     unless:

               (i) the resale of the Securities is registered pursuant to an
          effective registration statement under the Securities Act and such
          resale is made in accordance with said registration statement;

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               (ii) the Securities are sold or transferred pursuant to Rule 144
          promulgated under the Securities Act ("Rule 144") and the Investor has
          delivered to the Company a statement certifying that the proposed sale
          or transfer meets the requirements of Rule 144 (which certification
          shall be in form and content reasonably acceptable to the Company),
          and, if reasonably requested by the Company, a statement describing
          the circumstances surrounding the proposed sale or transfer (the form
          and content of which shall be reasonably acceptable to the Company)
          and, if reasonably requested by the Company after receiving such
          statement describing circumstances, an opinion of counsel (which
          opinion shall be in form, substance and scope customary for opinions
          of counsel in comparable transactions and which counsel, including
          internal counsel of the Investor, if applicable, shall be reasonably
          satisfactory to the Company) to the effect that the proposed sale or
          transfer meets the requirements of Rule 144 (collectively, the "144
          Documentation");

               (iii) the Securities are sold or transferred to an affiliate (as
          defined in Rule 144) of the Investor;

               (iv) the Securities are sold or transferred in an "offshore
          transaction" meeting the requirements of Rule 904 of Regulation S of
          the Securities Act ("Rule 904") and in compliance with applicable
          local laws and regulations, and the Investor has delivered to the
          Company a statement certifying that the proposed sale or transfer
          meets the requirements of Rule 904 and applicable local laws and
          regulations (which certification shall be in form and content
          reasonably acceptable to the Company), and, if reasonably requested by
          the Company, a statement describing the circumstances surrounding the
          proposed sale or transfer (the form and content of which shall be
          reasonably acceptable to the Company) and, if reasonably requested by
          the Company after receiving such statement describing circumstances,
          an opinion of counsel (which opinion shall be in form, substance and
          scope customary for opinions of counsel in comparable transactions and
          which counsel, including internal counsel of the Investor, if
          applicable, shall be reasonably satisfactory to the Company) to the
          effect that the proposed sale or transfer meets the requirements of
          Rule 904 and applicable local laws and regulations (collectively, the
          "904 Documentation"); or

               (v) in connection with a transfer other than in accordance with
          clause (i), (ii), (iii), or (iv) herein, a statement certifying that
          the proposed disposition may be made pursuant to an exemption from
          registration, which exemption is specified (which certification shall
          be in form and content reasonably acceptable to the Company), and, if
          reasonably requested by the Company, the Investor has delivered to the
          Company a statement describing the circumstances surrounding the
          proposed disposition (the form and content of which shall be
          reasonably acceptable to the Company), and, if reasonably requested by
          the Company after receiving such statement describing circumstances,
          an opinion of counsel (which opinion shall be in form, substance and
          scope customary for opinions of counsel in comparable transactions and
          which counsel, including internal counsel of the Investor, if
          applicable, shall be reasonably satisfactory to the Company) to the
          effect that the proposed disposition may be made pursuant to an
          exemption from registration, which exemption is specified
          (collectively, the "Other Exemption Documentation"); and

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          (b) any sale of the Securities made in reliance on Rule 144 may be
     made only in accordance with the terms of Rule 144 (including the holding
     period requirement, the volume limitations and the manner of sale
     restrictions, if applicable), and if Rule 144 is not applicable, then the
     seller (or the person through whom the sale is made) might be deemed to be
     an underwriter (as that term is defined in the Securities Act) under the
     Securities Act or the rules and regulations of the SEC thereunder; and

          (c) except as set forth in the Registration Rights Agreement, neither
     the Company nor any other person is under any obligation to register the
     Securities under the Securities Act or any state securities laws or to
     comply with the terms and conditions of any exemption thereunder.

     2.8. Legends. The Investor understands that the certificates representing
the Securities will bear a restrictive legend in substantially the form set
forth below (and a stop-transfer order may be placed against transfer of the
certificates for such Securities) until (a) the Securities are sold under an
effective registration statement filed under the Securities Act and such resale
is made in accordance with said registration statement; (b) the Securities may
be sold under Rule 144(k); (c) the Securities are sold or transferred under Rule
144 and the Investor delivers the 144 Documentation to the Company; (d) the
Securities are sold or transferred in a transaction that meets the requirements
of Rule 904 and complies with applicable local laws and regulations and the
Investor delivers the 904 Documentation to the Company; or (e) in connection
with a transfer other than in accordance with clauses (a), (b), (c) or (d), the
Investor delivers the Other Exemption Documentation to the Company.

               THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN SOLD IN
          RELIANCE UPON AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
          THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT OF 1933, AS
          AMENDED (THE "SECURITIES ACT"). THE SECURITIES MAY NOT BE OFFERED,
          SOLD, TRANSFERRED OR ASSIGNED EXCEPT PURSUANT TO AN EFFECTIVE
          REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OR
          PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
          SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
          ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.

     The legend set forth above will be removed, and the Company will issue a
certificate without the legend to the holder of any certificate upon which it is
stamped, in accordance with the terms of Article V.

     2.9. Organization and Existence. To the extent indicated on the signature
pages hereto, each Investor is either (i) a limited partnership duly organized
and validly existing under the laws of its respective state of formation, (ii) a
limited liability company duly organized and validly existing under the laws of
its respective state of formation, (iii) a limited company duly organized and
validly existing under the laws of the British Virgin Islands, (iv) a
corporation duly organized and validly existing under the laws of its respective
state of incorporation, (v) a series of a registered investment company, (vi) a
trust fund whose trustee is a bank or trust company or (vii) an individual. Such
Investor represents that it was not organized solely for the purpose of making
an investment in the Company.

     2.10. Authorization; Enforcement. This Agreement, the Registration Rights
Agreement and all other agreements, documents and instruments contemplated
hereby and thereby have been duly and validly authorized, executed and delivered
on behalf of the Investor and are valid and binding agreements of the Investor
enforceable against Investor in accordance with their respective terms, subject
to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the rights of

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creditors generally and the application of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law), and except as the enforceability of the indemnification
agreements of the Investor in the Registration Rights Agreement may be limited
by federal or state securities law or public policy relating thereto.

     2.11. No Conflicts; No Violation.

          (a) The execution, delivery and performance of this Agreement by the
     Investor will not (i) conflict with or result in a violation of any
     provision of its charter documents or (ii) result in a violation of any
     law, rule, regulation, order, judgment or decree applicable to the Investor
     that would have material adverse effect on the Investor's ability to
     perform its obligations under this Agreement or any other agreements,
     documents or instruments contemplated by this Agreement to which the
     Investor is a party.

          (b) The Investor is not required to obtain any consent, authorization
     or order of, or make any filing or registration with, any court or
     governmental agency or any regulatory or self regulatory agency for it to
     execute, deliver or perform any of its obligations under this Agreement
     that the Investor has not obtained or filed or the failure of which to
     obtain or file would not have a material adverse effect on the Investor's
     ability to perform its obligations under this Agreement.

     2.12. Acknowledgments Regarding Placement Agent. The Investor acknowledges
that Robert W. Baird & Co. Incorporated is acting as placement agent (the
"Placement Agent") for the Securities being offered hereby and will be
compensated by the Company for acting in such capacity. The Investor further
acknowledges that the Placement Agent has acted solely as placement agent for
the Company in connection with the offering of the Securities by the Company,
that certain of the information and data provided to the Investor in connection
with the transactions contemplated hereby, including but not necessarily limited
to the information and data included in the CIM, have not been subjected to
independent verification by the Placement Agent, and that the Placement Agent
makes no representation or warranty with respect to the accuracy or completeness
of such information, data or other related disclosure material. The Investor
further acknowledges that the provisions of this Section 2.12 are also for the
benefit of, and may also be enforced by, the Placement Agent.

     2.13. Representation. The Investor has had an opportunity to consult with
an attorney in connection with the Investor's investment in the Company and its
subsidiaries.

     2.14. Certain Trading Activities. Except for those positions that the
Investor has disclosed to the Company in writing prior to the execution of this
Agreement, the Investor has not directly or indirectly, nor has any Person (as
defined herein) acting on behalf of or pursuant to any understanding with such
Investor, engaged in any Short Sales (as defined below) involving the Common
Stock during the thirty (30) calendar days prior to the date of this Agreement,
and no open position or Short Sale exists on the date hereof in the name or on
behalf of, or in conjunction with, such Investor. "Short Sales" include, without
limitation, all types of direct and indirect stock pledges, forward sale
contracts, options, puts, calls, short sales, swaps and similar arrangements
(including on a total return basis), and sales and other transactions through
non-U.S. broker-dealers or foreign regulated brokers having the effect of
hedging the Securities purchased or investment made under this Agreement.

                                  ARTICLE III
                 REPRESENTATIONS AND WARRANTIES OF THE COMPANY

     Subject to such matters as are disclosed in the Company's SEC Documents,
the Company represents and warrants to the Investors that:

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     3.1. Organization and Qualification. The Company and its subsidiaries are
duly incorporated, validly existing and in good standing under the laws of the
jurisdictions in which they are incorporated, with full corporate power and
authority to own, lease, use and operate their properties and to carry on their
business as and where now owned, leased, used, operated and conducted. The
Company and its subsidiaries are duly qualified to do business and are in good
standing in every jurisdiction in which the nature of the business conducted by
it makes such qualification necessary, except where the failure to be so
qualified or in good standing in each such jurisdiction would not have a
Material Adverse Effect (as defined herein).

     3.2. Authorization; Enforcement. (a) The Company has all requisite
corporate power and authority (other than the Shareholder Approval that the
Company must receive to enable it to perform its obligations at the Closing) to
enter into and to perform its obligations under this Agreement, the Registration
Rights Agreement and all other agreements, documents and instruments
contemplated hereby and thereby, to consummate the transactions contemplated
hereby and thereby and to deliver the Securities in accordance with the terms
hereof; (b) the execution, delivery and performance of this Agreement, the
Registration Rights Agreement and all other agreements, documents and
instruments contemplated hereby and thereby by the Company and the consummation
by it of the transactions contemplated hereby and thereby including without
limitation the delivery of the Securities have been duly authorized by the
Company's Board of Directors and no further consent or authorization of the
Company, its Board of Directors or its shareholders is required (other than the
Shareholder Approval that the Company must receive to enable it to perform its
obligations at the Closing); (c) this Agreement, the Registration Rights
Agreement and all other agreements, documents and instruments contemplated
hereby and thereby have been or will be duly executed by the Company; and (d)
each of this Agreement, the Registration Rights Agreement and all other
agreements, documents and instruments contemplated hereby and thereby
constitutes or will upon execution constitute a legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, subject to the effect of any applicable bankruptcy, insolvency,
reorganization, or moratorium or similar laws affecting the rights of creditors
generally and the application of general principles of equity, and except as the
enforceability of the indemnification agreements of the Company in the
Registration Rights Agreement may be limited by federal or state securities laws
or public policy relating thereto.

     3.3. Capitalization. The capitalization of the Company is as described in
the Company's SEC Documents as of the respective dates set forth therein. Other
than pursuant to this Agreement and as contemplated by employee benefit plans or
director plans disclosed in the Company's SEC Documents (the "Plans"), and
except as disclosed in the Company's SEC Documents, the Company has not issued
any capital stock since December 31, 2002. The authorized capital stock of the
Company consists of (i) 25,000,000 shares of the Common Stock, of which
15,517,411 shares were issued and outstanding as of September 24, 2003 and (ii)
5,000,000 shares of preferred stock, without par value, none of which are issued
and outstanding. All of such outstanding shares of Common Stock are duly
authorized, validly issued, fully paid and nonassessable (except as otherwise
provided by Section 180.0622(2)(b) of the Wisconsin Business Corporation Law).
Assuming receipt of the Shareholder Approval, the Common Stock to be sold
pursuant to this Agreement has been duly authorized, and when delivered and paid
for in accordance with the terms of this Agreement, will be validly issued,
fully paid and nonassessable (except as otherwise provided by Section
180.0622(2)(b) of the Wisconsin Business Corporation Law), free from all taxes,
liens, claims, encumbrances and charges with respect to the delivery thereof
(other than those imposed through acts or omissions of an Investor). Each share
of Common Stock to be sold pursuant to this Agreement will be accompanied by
four-ninths of a Right, and such Rights will be validly issued in accordance
with the terms of the Rights Agreement (as defined herein). Other than pursuant
to this Agreement and the Rights and as contemplated by the Plans, the Note
Purchase Agreement, the Company's employee equity plan being submitted for
Shareholder Approval, and the warrants issued by the Company in August 2003, and
except as disclosed in the Company's SEC Documents: (i) no shares of the
Company's capital stock are subject to preemptive rights or any other similar
rights or any liens or encumbrances suffered or permitted by the Company; (ii)
there are no outstanding options, warrants, scrip, rights to subscribe to, calls
or commitments

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of any character whatsoever relating to, or securities or rights convertible
into, or exercisable or exchangeable for, any shares of capital stock of the
Company, or contracts, commitments, understandings or arrangements by which the
Company is or may become bound to issue additional shares of capital stock of
the Company or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any shares of capital
stock of the Company; (iii) there are no agreements or arrangements under which
the Company is obligated to register the sale of its securities under the
Securities Act (except the Registration Rights Agreement); (iv) there are no
outstanding securities or instruments of the Company that contain any redemption
or similar provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company is or may become bound to redeem a security
of the Company; (v) there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of
the Notes; (vi) the Company does not have any stock appreciation rights or
"phantom stock" plans or agreements or any similar plan or agreement; and (vii)
the Company has no liabilities or obligations required to be disclosed in the
SEC Documents that have not been so disclosed in the SEC Documents, other than
those incurred in the ordinary course of the Company's respective businesses and
which, individually or in the aggregate, do not or would not have a Material
Adverse Effect. The Company has furnished or made available to the Investors
true, correct and complete copies of the Company's Articles of Incorporation, as
amended and as in effect on the date hereof (the "Articles of Incorporation"),
and the Company's Bylaws, as amended and as in effect on the date hereof (the
"Bylaws"), and the terms of all securities convertible into, or exercisable or
exchangeable for, Common Stock and the material rights of the holders thereof in
respect thereto.

     3.4. No Conflicts; No Violation.

          (a) The execution, delivery and performance of this Agreement, the
     Registration Rights Agreement and all other agreements, documents and
     instruments contemplated hereby and thereby by the Company and the
     consummation by the Company of the transactions contemplated hereby and
     thereby including, without limitation, the delivery of the Securities will
     not (i) assuming receipt of Shareholder Approval, conflict with or result
     in a violation of any provision of the Organizational Documents (as defined
     herein) of the Company or any of its subsidiaries or (ii) violate or
     conflict with, or result in a breach of any provision of, or constitute a
     default (or an event which with notice or lapse of time or both could
     become a default) under, or give to others any rights of termination,
     amendment (including without limitation, the triggering of any
     anti-dilution provision), acceleration or cancellation of, any agreement,
     indenture, patent, patent license or instrument to which the Company or any
     of its subsidiaries is a party, or (iii) assuming the accuracy of the
     representations of the Investors, result in a violation of any law, rule,
     regulation, order, judgment or decree (including United States federal and
     state securities laws and regulations and regulations of any
     self-regulatory organizations to which the Company or any of its
     subsidiaries or their respective securities are subject), applicable to the
     Company or any of its subsidiaries or by which any property or asset of the
     Company or any of its subsidiaries is bound or affected, except in the case
     of clause (ii) for such conflicts, breaches, defaults, terminations,
     amendments, accelerations, cancellations and violations as would not,
     individually or in the aggregate, have a Material Adverse Effect.

          (b) Neither the Company nor any of its subsidiaries is in violation of
     its Organizational Documents except for any violations as would not,
     individually or in the aggregate, have a Material Adverse Effect. Neither
     Company nor any of its subsidiaries is in violation of any law, rule,
     ordinance, regulation, order, decree or judgment of any court or
     governmental entity which violation, individually or in the aggregate would
     result in a Material Adverse Effect. Neither the Company nor any of its
     subsidiaries is in default (and no event has occurred which with notice or
     lapse of time or both could put the Company or any of its subsidiaries in
     default) under any agreement, indenture or instrument to which the Company
     is a party or by which any property or

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     assets of the Company is bound or affected, except for such defaults as
     would not, individually or in the aggregate, have a Material Adverse
     Effect.

     3.5. Approvals. Assuming the accuracy of the representations of the
Investors, except as specifically contemplated by this Agreement and as required
under the Securities Act and any applicable state securities laws and any
listing agreement with any securities exchange or automated quotation system,
neither the Company nor any of its subsidiaries is required to obtain any
consent, authorization or order of, or make any filing or registration with, any
court or governmental agency or any regulatory or self regulatory agency for the
Company to execute, deliver or perform any of its obligations under this
Agreement or the Registration Rights Agreement, in each case in accordance with
the terms hereof or thereof, or sell the Securities in accordance with the terms
hereof (other than the Shareholder Approval that the Company must receive to
enable it to perform its obligations at the Closing). All consents,
authorizations, orders, filings and registrations that the Company is required
to obtain pursuant to the preceding sentence have been obtained or effected on
or prior to the date hereof (other than the Shareholder Approval that the
Company must receive to enable it to perform its obligations at the Closing).

     3.6. SEC Documents; Financial Statements. Since December 31, 2002, the
Company has timely filed all reports, schedules, forms, statements and other
documents required to be filed by it with the SEC pursuant to the reporting
requirements of the Exchange Act (all of the foregoing filed after December 31,
2002 and prior to the date hereof and all exhibits included therein and
financial statements and schedules thereto and documents (including all exhibits
available on the SEC's EDGAR system) incorporated by reference therein being
hereinafter referred to herein as the "SEC Documents"). The Company has
delivered to each Investor, or each Investor has had access to, true and
complete copies of the SEC Documents. As of their respective dates, the SEC
Documents complied in all material respects with the requirements of the
Exchange Act and the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and none of the SEC Documents, at the time they
were filed with the SEC (except as disclosed in the SEC Documents), contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC
Documents have been prepared in accordance with United States generally accepted
accounting principles, consistently applied, during the periods involved (except
(i) as may be otherwise indicated in such financial statements or the notes
thereto or (ii) in the case of unaudited interim statements, to the extent they
may not include footnotes or may be condensed or summary statements) and fairly
present in all material respects the financial position of the Company as of the
dates thereof and the results of its operations and cash flows for the periods
then ended (subject, in the case of unaudited statements, to normal year-end
audit adjustments). There are no unconsolidated special-purpose entities related
to the Company that should be consolidated on the Company's financial statements
under United States generally accepted accounting principles. Except as set
forth in the financial statements included in the SEC Documents, the Company has
no liabilities, contingent or otherwise, other than (A) liabilities incurred in
the ordinary course of business subsequent to June 30, 2003 that would not,
individually or in the aggregate, have a Material Adverse Effect, (B)
liabilities of which the Company has no Knowledge (as defined herein) so long as
the Company would not have acquired Knowledge thereof through the exercise of
reasonable diligence or (C) other liabilities that would not, individually or in
the aggregate, have a Material Adverse Effect.

     3.7. Absence of Certain Changes. Except as disclosed in the SEC Documents
or as set forth on Schedule 3.7, since December 31, 2002, there has been no
material adverse change in the assets, liabilities, business, properties,
operations, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.

     3.8. Absence of Litigation. Except as disclosed in the SEC Documents, there
is no action, suit, claim, proceeding, inquiry or investigation before or by any
court, public board, government agency, self-regulatory organization or body
pending or, to the Knowledge of the Company, threatened against or

                                       9
<PAGE>
affecting the Company, any of its subsidiaries or any of their respective
officers or directors acting as such that is reasonably likely to, individually
or in the aggregate, have a Material Adverse Effect.

     3.9. Intellectual Property Rights. The Company owns or possesses the
licenses or rights to use all patents, patent applications, patent rights,
inventions, know-how, trade secrets, trademarks, trademark applications, service
marks, service names, trade names and copyrights necessary to enable it to
conduct its business as now operated (the "Intellectual Property"), except where
the failure to possess such licenses or rights to use would not have,
individually or in the aggregate, a Material Adverse Effect. There is no claim
or action or proceeding pending or, to the Company's Knowledge, threatened that
challenges the right of the Company with respect to any Intellectual Property.

     3.10. Tax Status. The Company and, where applicable, its subsidiaries have
made or filed all federal, state and foreign income and all other tax returns,
reports and declarations required by any jurisdiction to which they are subject
(unless and only to the extent that the Company and, where applicable, its
subsidiaries have set aside on their respective books provisions reasonably
adequate for the payment of all unpaid and unreported taxes) and have paid all
taxes and other governmental assessments and charges that are material in
amount, shown or determined to be due on such returns, reports and declarations,
except those being contested in good faith. To the Knowledge of the Company,
there are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction.

     3.11. No Integrated Offering. Neither the Company, nor any of its
affiliates, nor any person acting on its or their behalf, has directly or
indirectly made any offers or sales of any security or solicited any offers to
buy any security under circumstances within the prior six months that would
require registration under the Securities Act of the delivery of the Securities
to the Investors.

     3.12. No Brokers. The Company will pay all brokerage commissions, finder's
fees or similar payments relating to this Agreement or the transactions
contemplated hereby where the obligation to make such payments arises due solely
and directly to action taken by the Company, and such payments will not exceed
6% of the gross proceeds to the Company from the transactions contemplated by
this Agreement.

     3.13. Insurance. The Company and its subsidiaries maintain insurance of the
types and in such amounts as their respective officers believe to be prudent and
customary in the businesses in which the Company and its subsidiaries are
engaged.

     3.14. Environmental Laws. The Company and its subsidiaries (i) are in
compliance with all applicable foreign, federal, state and local laws,
regulations, orders or judgments relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants ("Environmental Laws"), (ii) have received all permits, licenses
or other approvals required of it under applicable Environmental Laws to conduct
its business as presently conducted and (iii) are in compliance with all terms
and conditions of any such permit, license or approval, except where, in each of
the three foregoing clauses, the failure to so comply would not have,
individually or in the aggregate, a Material Adverse Effect.

     3.15. Employment Matters. The Company and its subsidiaries are in
compliance with all federal, state, local and foreign laws and regulations
respecting employment and employment practices, terms and conditions of
employment and wages and hours, except where failure to be in compliance would
not, individually or in the aggregate, have a Material Adverse Effect. To the
Knowledge of the Company, there are no pending investigations involving the
Company or any of its subsidiaries by the U.S. Department of Labor or any other
governmental agency responsible for the enforcement of such federal, state,
local or foreign laws and regulations. There is no unfair labor practice charge
or complaint against the Company or any of its subsidiaries pending before the
National Labor Relations Board or any strike, picketing, boycott, dispute,
slowdown or stoppage pending or threatened against the Company or any of its
subsidiaries. No

                                       10
<PAGE>
representation question exists respecting the employees of the Company or any of
its subsidiaries, and no collective bargaining agreement or modification thereof
is currently being negotiated by the Company or any of its subsidiaries. There
are no outstanding wage claims of, or other debts owing to, employees of the
Company for services performed.

     3.16. No General Solicitation. Neither the Company nor, to the Knowledge of
the Company, any person acting for the Company has conducted any "general
solicitation" (as such term is defined in Regulation D) with respect to any of
the Common Stock being offered hereby. The Company will not distribute any
offering material in connection with the sale of the Common Stock prior to the
Closing Date, other than the CIM, this Agreement, the Registration Rights
Agreement, the NYSE (as defined herein) Supplemental Listing Application, and
the SEC Documents.

     3.17. NYSE Compliance. The Company has not, in the 12 months preceding the
date hereof, received notice from the NYSE that the Company is not in compliance
with the listing or maintenance requirements of the NYSE. The Company is in
compliance with all such listing and maintenance requirements. Assuming the
truth of the representations and warranties of each Investor and assuming
receipt of the Shareholder Approval, the issuance and sale of the Securities
hereunder does not contravene the rules and regulations of the NYSE. The Company
has taken no action designed to effect the de-listing of the Common Stock from
the NYSE.

     3.18. Compliance with the Sarbanes-Oxley Act. The Company is in material
compliance with the applicable provisions of the Sarbanes-Oxley Act of 2002 and
the rules and regulations promulgated in connection therewith (the
"Sarbanes-Oxley Act") that are effective and is actively taking steps to ensure
that it will be in material compliance with other applicable provisions of the
Sarbanes-Oxley Act upon the effectiveness of such provisions.

     3.19. Licenses and Permits. The Company and its subsidiaries have all
licenses, permits, approvals, authorizations and consents necessary to own,
lease, and operate their properties and to conduct their respective businesses
as currently being conducted (collectively, the "Company Permits"), except where
the failure to have such permits would not have, individually or in the
aggregate, a Material Adverse Effect. There is no action pending or, to the
Knowledge of the Company, threatened regarding the suspension or cancellation of
any of the Company Permits the suspension or cancellation of which would have a
Material Adverse Effect. Neither the Company nor any of its subsidiaries is in
conflict with, or in default or violation of, any of the Company Permits, except
where such violation would not in the aggregate have a Material Adverse Effect.

     3.20. Investment Company Status. The Company is not and upon consummation
of the sale of the Securities will not be an "investment company," a company
controlled by an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company" as such terms
are defined in the Investment Company Act of 1940, as amended.

                                   ARTICLE IV
                                   COVENANTS

     4.1. Best Efforts. Each party will use its best efforts to satisfy in a
timely fashion each of the conditions to be satisfied by it under Articles VI
and VII of this Agreement.

     4.2. Form D; Blue Sky Laws. The Company will file a Notice of Sale of
Securities on Form D with respect to the Securities, if required under
Regulation D, and provide a copy thereof to each Investor promptly after such
filing. The Company will take such action as it reasonably determines to be
necessary, if any, to qualify the Securities for sale to the Investors under
this Agreement under applicable securities (or "blue sky") laws of the states of
the United States (or to obtain an exemption from such

                                       11
<PAGE>
qualification), and will provide evidence of any such action so taken to the
Investors on or prior to the date of the Closing. The Company will file with the
SEC a Current Report on Form 8-K disclosing this Agreement and the transactions
contemplated hereby within two (2) Business Days after the Closing Date.

     4.3. Reporting Status. The Common Stock and Rights are registered under
Section 12 of the Exchange Act. Throughout the Registration Period (as defined
in the Registration Rights Agreement), the Company will use its best efforts to
timely file all reports, schedules, exhibits, forms, statements and other
documents required to be filed by it with the SEC under the reporting
requirements of the Exchange Act, and the Company will not terminate its status
as an issuer required to file reports under the Exchange Act even if the
Exchange Act or the rules and regulations thereunder would permit such
termination.

     4.4. Expenses. The Company and each Investor is liable for, and will pay,
its own expenses incurred in connection with the negotiation, preparation,
execution and delivery of this Agreement and the other agreements to be executed
in connection herewith, including, without limitation, attorneys' and
consultants' fees and expenses. In accordance with, and subject to, Section
3.12, the Company will pay all brokerage commissions, finder's fees or similar
payments relating to this Agreement or the transactions contemplated herein.

     4.5. Financial Information. Throughout the Registration Period, the
financial statements of the Company filed with the SEC will be prepared in
accordance with United States generally accepted accounting principles and will
fairly present in all material respects the consolidated financial position of
the Company and results of its operations and cash flows as of, and for the
periods covered by, such financial statements (subject, in the case of unaudited
statements, to normal year-end audit adjustments).

     4.6. Listing. Throughout the Registration Period, but only so long as an
Investor owns any of the Securities, the Company will use its reasonable best
efforts to obtain and to maintain the listing and trading of its Common Stock
(including the Securities) on the NYSE or the market or trading system, if any,
on which shares of Common Stock are then listed or traded.

     4.7. Compliance with Law. Throughout the Registration Period, but only so
long as an Investor owns any of the Securities, the Company will use its
reasonable best efforts to conduct the business of the Company and its
subsidiaries in compliance with laws, ordinances and regulations of any
governmental entity except for violations that would not result, either
individually or in the aggregate, in a Material Adverse Effect.

     4.8. No Integration. The Company will not make any offers or sales of any
security (other than the Securities and the Notes) under circumstances that
would cause the offering of the Securities to be integrated with any other
offering of securities by the Company for purposes of any registration
requirement under the Securities Act.

     4.9. Sales by Investors. Each Investor will sell any Securities sold by it
in compliance with applicable prospectus delivery requirements, if any, or
otherwise in compliance with the requirements for an exemption from registration
under the Securities Act and the rules and regulations promulgated thereunder.
No Investor will make any sale, transfer or other disposition of the Securities
in violation of federal or state securities laws.

     4.10. Use of Proceeds. The Company will use the proceeds from the sale of
the Securities to repay indebtedness or for general corporate and working
capital purposes. The Company will not use the proceeds from the sale of the
Securities for any loan to or investment in any other corporation, partnership,
enterprise or other person (except in connection with its direct or indirect
subsidiaries) or for the repurchase, redemption or retirement of any of its
capital stock.

                                       12
<PAGE>
     4.11. Press Release. In connection with the Closing, the Company will issue
within one (1) Business Day after the Closing a press release that discloses in
accordance with applicable law the material terms of the transactions
contemplated hereby.

     4.12. Non-Public Information. The Company acknowledges that as of, and
following, the Closing Date, the Company will have an obligation respecting the
Investors (as with any other person) under applicable laws, rules and
regulations not to selectively disclose any material, non-public information in
violation of any such applicable law, rule or regulation.

     4.13. Proxy Statement. The Company shall provide each shareholder entitled
to vote at the next meeting of shareholders of the Company, which shall not be
later than November 30, 2003, a proxy statement soliciting each such
shareholder's affirmative vote at such shareholder meeting for approval of (i)
the increase in the authorized Common Stock to 50 million shares, (ii) the
issuance of Common Stock upon the conversion of the Notes to be sold pursuant to
the Note Purchase Agreement at the Second Closing (as defined in the Note
Purchase Agreement), (iii) the issuance of certain options to employees and (iv)
the transaction contemplated by this Agreement, in each case in accordance with
the Articles of Incorporation and Bylaws and applicable law and the rules and
regulations of the NYSE (such affirmative approval of each of the foregoing
being referred to herein as the "Shareholder Approval"), and the Company shall
use its best efforts to solicit its shareholders' approval of such matters and
to cause the Board of Directors of the Company to recommend to the shareholders
that they approve such matters. From and after the date hereof and prior to
receipt of the Shareholder Approval, the Company shall not issue any securities
(other than pursuant to contractual arrangements under which the Company is
obligated as of the date hereof or convertible or exchangeable securities
outstanding as of the date hereof, in each case in accordance with the terms in
place on the date hereof).

                                   ARTICLE V
                TRANSFER AGENT INSTRUCTIONS; REMOVAL OF LEGENDS

     5.1. Issuance of Certificates. The Company will instruct its transfer agent
to issue a certificate, registered in the name of each Investor or its nominee,
for the respective Securities. All such certificates at issuance will bear the
restrictive legend described in Section 2.8, except as otherwise specified in
this Article V. In addition, the Company will issue irrevocable Transfer Agent
Instructions (as defined herein) to the transfer agent in the form of Exhibit A
hereto. The Company will not give to its transfer agent any instruction with
respect to the Securities other than as contemplated by Article V and stop
transfer instructions to give effect to Section 2.8 (prior to registration of
the Securities under the Securities Act). Nothing in this Section will affect in
any way the Investors' obligations and agreements set forth in Section 4.9 to
comply with all applicable prospectus delivery requirements, if any, upon resale
of the Securities.

     5.2. Unrestricted Securities. If, unless otherwise required by applicable
state securities laws, (a) the Securities are sold under an effective
registration statement filed under the Securities Act and such resale is made in
accordance with said registration statement; (b) the Securities may be sold
under Rule 144(k); (c) the Securities are sold or transferred under Rule 144 and
the Investor delivers the 144 Documentation to the Company; (d) the Securities
are sold or transferred in a transaction that meets the requirements of Rule 904
and complies with applicable local laws and regulations and the Investor
delivers the 904 Documentation to the Company; or (e) in connection with a
transfer other than in accordance with clauses (a), (b), (c) or (d), the
Investor delivers the Other Exemption Documentation to the Company, then the
Company will permit the transfer of the Securities, and the transfer agent will
issue one or more certificates, free from any restrictive legend, in such name
and in such denominations as specified by such holder in accordance with the
Transfer Agent Instructions. Notwithstanding anything herein to the contrary,
(i) the Securities may be pledged as collateral in connection with a bona fide
margin account or other lending arrangement; provided that such pledge will not
alter the provisions of this Article V with respect to the removal of
restrictive legends, and (ii) any Investor that is a registered investment
company may transfer

                                       13
<PAGE>
shares to any other fund or account advised by such Investor's investment
manager or its affiliates if the transferee is a qualified institutional buyer
(as defined in Rule 144A under the Securities Act) and agrees in writing to be
bound by the terms hereof and the terms of the Registration Rights Agreement.

     5.3. Enforcement of Provision. The Company acknowledges that a breach by it
of its obligations hereunder will cause irreparable harm to the Investor by
invalidating the intent and purpose of the transaction contemplated hereby.
Accordingly, the Company acknowledges that the remedy at law for a breach of its
obligations under this Article V will be inadequate and agrees, in the event of
a breach or threatened breach by the Company of the provisions of this Article
that the Investor will be entitled, in addition to all other available remedies,
to an injunction restraining any breach and requiring immediate transfer,
without the necessity of showing economic loss and without any bond or other
security being required.

                                   ARTICLE VI
                 CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL

     The obligation of the Company under Article I of this Agreement is subject
to the fulfillment at or before the Closing of each of the following conditions.
These conditions are for the Company's benefit and may be waived by the Company
in whole or in part at any time in its sole discretion. Without limitation, the
Company may in its sole discretion proceed with the Closing with respect to each
Investor as to whom each condition has been satisfied whether or not conditions
have been satisfied as to other Investors:

     6.1. The Investors will have executed the Registration Rights Agreement and
will have delivered such Registration Rights Agreement to the Company on or
immediately prior to the Closing Date.

     6.2. The Investors will have delivered the purchase price for the
Securities to the Company in accordance with this Agreement on the Closing Date.

     6.3. The representations and warranties of the Investors are true and
correct in all material respects (except for representations and warranties that
by their terms are qualified by materiality, which shall be true and correct in
all respects) as of the Closing Date as though made at that time (except for
representations and warranties that speak as of a specific date, which
representations and warranties must be correct as of such date), and the
Investors will have performed and complied in all material respects with the
covenants and conditions required by this Agreement to be performed or complied
with by the Investors at or prior to the Closing.

     6.4. No litigation, statute, rule, regulation, executive order, decree,
ruling or injunction has been enacted, entered, promulgated or endorsed by or in
any court or governmental authority of competent jurisdiction or any
self-regulatory organization having authority over the matters contemplated
hereby which prohibits the consummation of any of the transactions contemplated
by this Agreement.

     6.5. The aggregate purchase price of the Notes purchased at the first
closing contemplated by the Note Purchase Agreement shall have been paid to the
Company pursuant to the Escrow Agreement (as defined herein).

     6.6. The Shareholder Approval shall have been received with respect to each
proposal other than the proposal respecting the approval of the issuance of
certain options to the Company's employees.

     6.7. The Investors will have confirmed in writing to the Company that, as
of the Closing Date and after giving effect to the consummation of the
transactions contemplated herein, no Investor

                                       14
<PAGE>
beneficially owns 10% or more of the outstanding shares of the Common Stock as
determined in accordance with Section 13(d) of the Exchange Act and the rules
and regulations promulgated thereunder.

                                  ARTICLE VII
              CONDITIONS TO EACH INVESTOR'S OBLIGATION TO PURCHASE

     The obligation of each Investor hereunder to purchase the Securities from
the Company at the Closing is subject to the fulfillment at or before the
Closing of each of the following conditions. These conditions are for each
Investor's respective benefit and may be waived by such Investor at any time in
its sole discretion:

     7.1. The Company will have executed the Registration Rights Agreement and
will have delivered such Agreement to the Investor on or immediately prior to
the Closing Date.

     7.2. The Company will have delivered to such Investor a duly executed
certificate, against payment therefor, representing the Securities as specified
in Section 1.1 on the Closing Date.

     7.3. The representations and warranties of the Company are true and correct
in all material respects (except for representations and warranties that by
their terms are qualified by materiality, which shall be true and correct in all
respects) as of the date of this Agreement (except for representations and
warranties that speak as of a specific date, which representations and
warranties must be true and correct as of such date), and the Company must have
performed and complied in all material respects with the covenants and
conditions required by this Agreement to be performed or complied with by the
Company at or prior to the Closing.

     7.4. No litigation, statute, rule, regulation, executive order, decree,
ruling or injunction has been enacted, entered, promulgated or endorsed by or in
any court or governmental authority of competent jurisdiction or any
self-regulatory organization having authority over the matters contemplated
hereby which prohibits the consummation of any of the transactions contemplated
by this Agreement.

     7.5. Such Investor will have received an opinion of the Company's counsel,
dated as of the Closing Date in form reasonably satisfactory to the Investors,
addressing the matters set forth in Exhibit B hereto.

     7.6. The Company has delivered evidence reasonably satisfactory to the
Investors of the Shareholder Approval of each proposal other than the proposal
respecting the approval of the issuance of certain options to the Company's
employees.

     7.7. The Notes purchased at the first closing contemplated by the Note
Purchase Agreement have been delivered to the Note Investors pursuant to the
Escrow Agreement.

     7.8. The irrevocable Transfer Agent Instructions, in substantially the form
attached hereto as Exhibit A will have been delivered to the Company's transfer
agent and acknowledged in writing by such transfer agent.

                                  ARTICLE VIII
                                  DEFINITIONS

     8.1. "Agreement" has the meaning set forth in the introduction to this
Agreement.

     8.2. "Articles of Incorporation" has the meaning set forth in Section 3.3.

                                       15
<PAGE>
     8.3. "Bylaws" has the meaning set forth in Section 3.3.

     8.4. "Business Day" means any day other than Saturday, Sunday or other day
on which commercial banks in the City of New York are authorized or required by
law to remain closed.

     8.5. "CIM" has the meaning set forth in Section 2.4.

     8.6. "Claims" or "Claim" has the meaning set forth in Section 9.1.

     8.7. "Closing" means the closing of the purchase and sale of the Securities
under this Agreement.

     8.8. "Closing Date" has the meaning set forth in Section 1.3.

     8.9. "Common Stock" has the meaning set forth in the Recitals.

     8.10. "Company" has the meaning set forth in the introduction to this
Agreement.

     8.11. "Company Indemnified Person" has the meaning set forth in Section
9.2.

     8.12. "Company Permits" has the meaning set forth in Section 3.19.

     8.13. "Environmental Laws" has the meaning set forth in Section 3.14.

     8.14. "Escrow Agreement" means that certain Escrow Agreement, dated
September 29, 2003, by and among the Company, Midwest Airlines, Inc., a
Wisconsin corporation and wholly-owned subsidiary of the Company, Skyway
Airlines, Inc., a Delaware corporation and wholly-owned subsidiary of Midwest,
YX Properties, LLC, a Nebraska limited liability company and an indirect
subsidiary of the Company, and the Note Investors.

     8.15. "Exchange Act" has the meaning set forth in Section 1.4.

     8.16. "Fund" has the meaning set forth in Section 10.12.

     8.17. "Indemnified Person" has the meaning set forth in Section 9.3.

     8.18. "Intellectual Property" has the meaning set forth in Section 3.9.

     8.19. "Investor Indemnified Persons" or "Investor Indemnified Person" has
the meaning set forth in Section 9.1.

     8.20. "Investors" or "Investor" has the meaning set forth in the
introduction to this Agreement.

     8.21. "Knowledge" means the actual knowledge of the executive officers of
the Company, without independent investigation.

     8.22. "Material Adverse Effect" means (a) a material adverse effect on the
assets, liabilities, financial condition or results of operations of the Company
and its subsidiaries, taken as a whole or (b) any adverse effect on the ability
of the Company to perform its obligations pursuant to the transactions
contemplated by this Agreement or under the agreements or instruments to be
entered into or filed in connection herewith.

                                       16
<PAGE>
     8.23. "Midwest" has the meaning set forth in the Recitals.

     8.24. "904 Documentation" has the meaning set forth in Section 2.7.

     8.25. "Note Investors" has the meaning set forth in the Recitals.

     8.26. "Note Purchase Agreement" has the meaning set forth in the Recitals.

     8.27. "Notes" has the meaning set forth in the Recitals.

     8.28. "NYSE" means the New York Stock Exchange.

     8.29. "144 Documentation" has the meaning set forth in Section 2.7.

     8.30. "Other Exemption Documentation" has the meaning set forth in Section
2.7.

     8.31. "Organizational Documents" means, with respect to a corporation, its
charter as filed with the applicable state regulatory authority, including any
amendment filed with respect thereto through the date hereof, and its by-laws,
as the same may have been amended through the date hereof, and with respect to a
limited liability company, its organizational filing made with the applicable
state regulatory authority, as the same may have been amended through the date
hereof, and its limited liability company agreement, operating agreement or
other similar agreement, as the same may be amended through the date hereof.

     8.32. "Person" means an individual, a limited liability company, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization and a government or any department or agency thereof.

     8.33. "Placement Agent" has the meaning set forth in Section 2.12.

     8.34. "Plans" has the meaning set forth in Section 3.3.

     8.35. "Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Closing Date, by and among the Company and the
Investors, in the form attached hereto as Exhibit C.

     8.36. "Regulation D" is defined in the Recitals.

     8.37. "Rights" means the Preferred Share Purchase Rights issued pursuant to
the Rights Agreement.

     8.38. "Rights Agreement" means the Rights Agreement, dated February 14,
1996, as amended, between the Company and American Stock Transfer & Trust
Company.

     8.39. "Rule 144" has the meaning set forth in Section 2.7.

     8.40. "Rule 904" has the meaning set forth in Section 2.7.

     8.41. "SEC" is defined in the Recitals.

     8.42. "SEC Documents" has the meaning set forth in Section 3.6.

     8.43. "Securities" means the Common Stock (including the associated Rights)
sold pursuant to this Agreement.

                                       17
<PAGE>
     8.44. "Securities Act" is defined in the Recitals.

     8.45. "Shareholder Approval" has the meaning set forth in Section 4.13.

     8.46. "Short Sales" has the meaning set forth in Section 2.14.

     8.47. "Transfer Agent Instructions" means the transfer agent instructions
as defined in Exhibit A.

     8.48. "Trust" has the meaning set forth in Section 10.12.

                                   ARTICLE IX
                                INDEMNIFICATION

     9.1. Indemnification of the Investors. In consideration of each Investor's
execution and delivery of this Agreement and its acquisition of the Securities
hereunder, the Company will indemnify and hold harmless each Investor, any
directors or officers of such Investor and any person who controls such Investor
within the meaning of the Securities Act or the Exchange Act or acts as such
Investor's investment advisor (each, an "Investor Indemnified Person" and,
collectively, "Investor Indemnified Persons") against any losses, claims,
damages, expenses or liabilities (joint or several) (collectively, and together
with actions, proceedings or inquiries by any regulatory or self-regulatory
organization, whether commenced or threatened in respect thereof, "Claims" and
each a "Claim") to which any of them become subject insofar as such Claims arise
out of or are based upon (a) any breach of any representation or warranty made
by the Company herein or (b) any breach of any covenant, agreement or obligation
of the Company contained herein. Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 9.1
does not apply to amounts paid in settlement of any Claim if such settlement is
made without the prior written consent of the Company, which consent will not be
unreasonably withheld or delayed, and the Company will not be liable under this
Agreement (including this Section 9.1) for any amount with respect to any Claim
after the aggregate amount the Company has paid pursuant to this Section 9.1
with respect to all Claims equals an amount equal to the product of three (3)
multiplied by the original aggregate purchase price of the Securities purchased
on the Closing Date. This indemnity obligation will remain in full force and
effect regardless of any investigation made by or on behalf of the Investor
Indemnified Persons.

     9.2. Indemnification of the Company. In consideration of the Company's
execution and delivery of this Agreement and its sale of the Securities
hereunder, each Investor will indemnify and hold harmless, severally and not
jointly, to the same extent and in the same manner set forth in Section 9.1
above, the Company, each of its directors, each of its officers and each person,
if any, who controls the Company within the meaning of the Securities Act or the
Exchange Act (each a "Company Indemnified Person") against any Claim to which
any of them may become subject insofar as such Claim arises out of or is based
upon (a) any breach of any representation or warranty made by such Investor
herein or (b) any breach of any covenant, agreement or obligation of such
Investor contained herein. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 9.2 does not
apply to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of such Investor, which consent will not be
unreasonably withheld, and no Investor will be liable under this Agreement
(including this Section 9.2) for the amount of any Claim that exceeds the net
proceeds actually received by such Investor as a result of the sale of such
Investor's Registrable Securities. This indemnity will remain in full force and
effect regardless of any investigation made by or on behalf of a Company
Indemnified Person.

     9.3. Notification and Other Indemnification Procedures. Promptly after
receipt by an Investor Indemnified Person or a Company Indemnified Person, as
the case may be (each an "Indemnified Person") under this Article IX of notice
of the commencement of any action (including any governmental

                                       18
<PAGE>
action) by any person other than an Indemnified Person, such Indemnified Person
will, if a Claim in respect thereof is to be made against any indemnifying party
under this Article IX, deliver to the indemnifying party a written notice of the
commencement thereof. The indemnifying party may participate in and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly given notice, assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying parties and the Indemnified Person. In
that case, the indemnifying party will diligently pursue such defense. If, in
the reasonable opinion of counsel retained by the indemnifying party, the
representation by such counsel of the Indemnified Person and the indemnifying
party would be inappropriate due to actual or potential conflicts of interest
between the Indemnified Person and any other party represented by such counsel
in such proceeding or the actual or potential defendants in, or targets of, any
such action including the Indemnified Person and such Indemnified Person
reasonably determines that there may be legal defenses available to such
Indemnified Person that are different from or in addition to those available to
the indemnifying party, then the Indemnified Person is entitled to assume such
defense and may retain its own counsel, with the reasonable fees and expenses to
be paid by the indemnifying party (subject to the restrictions on settlement
under Section 9.1 or 9.2, as applicable). However, the Company will pay for only
one separate legal counsel for the Investors collectively, and such legal
counsel will be selected in accordance with Section 11.12 of the Registration
Rights Agreement. The failure to deliver written notice to the indemnifying
party within a reasonable time of the commencement of any such action does not
relieve an indemnifying party of any liability to an Indemnified Person under
this Article IX, except to the extent that the indemnifying party is prejudiced
in its ability to defend such action.

                                   ARTICLE X
                          GOVERNING LAW; MISCELLANEOUS

     10.1. Governing Law; Jurisdiction. This Agreement will be governed by and
interpreted in accordance with the laws of the State of Wisconsin without regard
to the principles of conflict of laws.

     10.2. Counterparts; Signatures by Facsimile. This Agreement may be executed
in two or more counterparts, all of which are considered one and the same
agreement and will become effective when counterparts have been signed by each
party and delivered to the other parties. This Agreement, once executed by a
party, may be delivered to the other parties hereto by facsimile transmission of
a copy of this Agreement bearing the signature of the party so delivering this
Agreement.

     10.3. Headings. The headings of this Agreement are for convenience of
reference only, are not part of this Agreement and do not affect its
interpretation.

     10.4. Severability. If any provision of this Agreement is invalid or
unenforceable under any applicable statute or rule of law, then such provision
will be deemed modified to conform with such statute or rule of law. Any
provision hereof that may prove invalid or unenforceable under any law will not
affect the validity or enforceability of any other provision hereof.

     10.5. Entire Agreement; Amendments. This Agreement and the Registration
Rights Agreement (including all schedules and exhibits thereto) constitute the
entire agreement among the parties hereto with respect to the subject matter
hereof and thereof. There are no restrictions, promises, representations,
warranties or undertakings, other than those set forth or referred to herein or
therein. This Agreement supersedes all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof. No provision of
this Agreement may be waived or amended other than by an instrument in writing
signed by the party to be charged with enforcement.

     10.6. Notices. Any notices required or permitted to be given under the
terms of this Agreement must be sent by certified or registered mail (return
receipt requested) or delivered personally or by courier (including a recognized
overnight delivery service) or by facsimile and will be effective five days

                                       19
<PAGE>
after being placed in the mail, if mailed by regular United States mail, or upon
receipt, if delivered personally or by facsimile, in each case addressed to a
party. Any notice sent by courier (including a recognized overnight delivery
service) will be deemed received one (1) Business Day after being sent. The
addresses for such communications are:

      If to the Company:   Midwest Express Holdings, Inc.
                           6744 South Howell Avenue
                           Oak Creek, WI 53154
                           Attention: Robert S. Bahlman
                           Fax: (414) 570-9666

                           With a copy to:

                           Foley & Lardner
                           777 East Wisconsin Avenue, Suite 3700
                           Milwaukee, WI 53202
                           Attention: Patrick G. Quick, Esq.
                           Fax: (414) 297-4900

If to an Investor: To the address set forth immediately below such Investor's
name on the signature pages hereto, with copies to the person(s) designated by
such Investor on the Investor's signature page, if any.

Each party will provide written notice to the other parties of any change in its
address.

     10.7. Successors and Assigns. This Agreement is binding upon and inures to
the benefit of the parties and their successors and permitted assigns. The
Company will not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Investors, and no Investor may assign
this Agreement or any rights or obligations hereunder without the prior written
consent of the Company. Notwithstanding the foregoing, an Investor may assign
all or part of its rights and obligations hereunder to any of its "affiliates,"
as that term is defined under the Securities Act, without the consent of the
Company so long as the affiliate is a "qualified institutional buyer" or an
"institutional accredited investor" as defined in Section 2.2 and agrees in
writing to be bound by this Agreement. This provision does not limit the
Investor's right to transfer the Securities pursuant to the terms of this
Agreement or to assign the Investor's rights hereunder to any such affiliate
transferee pursuant to the terms of this Agreement. Notwithstanding the
foregoing, any transferee who purchases the Securities in a public sale shall
not have any rights under this Agreement.

     10.8. Third Party Beneficiaries. This Agreement is intended for the benefit
of the parties hereto and their respective permitted successors and assigns, and
is not for the benefit of, nor may any provision hereof be enforced by, any
other person or entity (except as specifically contemplated in Article IX);
provided, however, that the provisions in Section 2.12 relating to
acknowledgments regarding the Placement Agent are intended for the benefit of
the Placement Agent.

     10.9. Survival. The representations and warranties of the Company set forth
herein will survive for two (2) years following the Closing hereunder except
that (a) if the obligation of the Company to maintain the effectiveness of the
registration statement and keep current a prospectus thereunder extends beyond
this two-year period, then such representations and warranties shall survive as
long as such obligation exists and (b) the representations and warranties set
forth in Sections 3.1, 3.2, 3.3, 3.4(a), 3.10, 3.16 and 3.19 shall survive
indefinitely. The Company makes no representations or warranties in any oral or
written information provided to Investors, other than the representations and
warranties included herein.

                                       20
<PAGE>
     10.10. Further Assurances. Each party will do and perform, or cause to be
done and performed, all such further acts and things, and will execute and
deliver all other agreements, certificates, instruments and documents, as
another party may reasonably request to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.

     10.11. No Strict Construction. The language used in this Agreement is
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any party.

     10.12. Mutual Fund. Certain Investors are registered investment companies
entering into this Agreement solely on behalf of one or more of their mutual
fund series (each, a "Fund"). With respect to all obligations of a Fund arising
out of this Agreement, the Company will look for payment or satisfaction of any
claim solely to the assets and property of the applicable Fund.

                                    * * * * *

                                       21
<PAGE>
     IN WITNESS WHEREOF, the undersigned Investors and the Company have caused
this Agreement to be duly executed as of the date first above written.

                                   COMPANY:

                                   MIDWEST EXPRESS HOLDINGS, INC.

                                   By: /s/ Robert S. Bahlman
                                      ------------------------------------------
                                   Name:   Robert S. Bahlman
                                   Title:  Senior Vice President and
                                           Chief Financial Officer

                                   WIRE TRANSFER INSTRUCTIONS:

                                   Bank Name:  U.S. Bank, N.A.

                                   ABA Number:  075000022

                                   Account Number:  121727847

                                   Account Name:  Midwest Express Airlines, Inc.

<PAGE>
                      [INVESTORS' SIGNATURE PAGES OMITTED]

                           OMNIBUS SIGNATURE PAGE TO
                         MIDWEST EXPRESS HOLDINGS, INC.
                         SECURITIES PURCHASE AGREEMENT

     The undersigned hereby executes and delivers the Securities Purchase
Agreement to which this Signature Page is attached, which, together with all
counterparts of the Agreement and Signature Pages of the other Investors and the
Company to said Agreement, shall constitute one and the same document in
accordance with the terms of the Agreement.

                                   [NAME OF INVESTOR]

                                   Sign Name:
                                             -----------------------------------
                                   Print Name:
                                             -----------------------------------
                                   Title:
                                             -----------------------------------
                                   Address:
                                             -----------------------------------

                                             -----------------------------------

                                   Telephone:
                                             -----------------------------------

                                   Facsimile:
                                             -----------------------------------

                                   Number of Shares:
                                   Name in which Shares Are to Be Held
                                   (please print):

                                   --------------------------------------

                                   Aggregate Purchase Price:

                  SOCIAL SECURITY OR TAX ID NUMBER:
                                                    ----------------------

<PAGE>
                                   EXHIBIT A

                           TRANSFER AGENT INSTRUCTIONS

                         MIDWEST EXPRESS HOLDINGS, INC.

                                _______ ___, 2003

American Stock Transfer & Trust Company
59 Maiden Lane
Plaza Level
New York, NY 10038
Attn:    Herbert J. Lemmer

     Re: Private Placement of 1,882,353 Shares of Common Stock
         -----------------------------------------------------

Ladies and Gentlemen:

     The Board of Directors of Midwest Express Holdings, Inc., a Wisconsin
corporation (the "Company"), has authorized the issuance of 1,882,353 shares of
the Company's common stock, par value $.01 per share (the "Shares"), to the
parties set forth on the attached Exhibit I (the "Investors"), pursuant to that
certain Securities Purchase Agreement, dated as of September 29, 2003 (the
"Securities Purchase Agreement"), by and among the Company and the Investors.

     The Company's hereby authorizes and instructs you (provided that you are
the transfer agent of the Company at such time) to issue (from authorized but
unissued shares), countersign and register certificates representing the Shares
in such names and in such share amounts as specified on the attached Exhibit I,
and to cause such certificates to be delivered to the addresses specified on the
attached Exhibit I. The closing of the purchase of the Shares will occur on
_______ ___, 2003, and accordingly, the certificates should be dated as of such
date. The certificates representing the Shares shall bear the legend set forth
below:

          "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
          REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
          "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS ("BLUE SKY LAWS"). THE
          HOLDER OF THIS CERTIFICATE MAY NOT TRANSFER THESE SECURITIES WITHOUT
          SUCH REGISTRATION OR AN EXEMPTION FROM SUCH REGISTRATION UNDER THE
          SECURITIES ACT AND ANY APPLICABLE BLUE SKY LAWS. NOTWITHSTANDING THE
          FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA
          FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY
          THE SECURITIES."

     The Company further instructs you not to acknowledge or record the transfer
of any Shares in the shareholder records of the Company or to issue certificates
representing any Shares to any person or entity other than the transferor
thereof unless the requirements set forth below are satisfied with respect to
such Shares, in which case such Shares are to be transferred free from any
restrictive legend (unless otherwise required by applicable state securities
laws or the laws of any applicable foreign jurisdiction) and registered in such
name and in such denominations as specified by the Investor in question:

<PAGE>
          You receive written notice from the Company that a registration
     statement covering resales of the Shares has been declared effective by the
     Securities and Exchange Commission under the Securities Act of 1933, as
     amended (the "Securities Act"), in the form attached hereto as Exhibit II,
     and written confirmation from the Investor in question that the resale of
     such Shares was made pursuant to such effective registration statement; or

          You receive written notice from the Company, accompanied by an opinion
     of counsel, that the sale of such Shares may be effected under Rule 144(k)
     of the Securities Act; or

          You receive written notice from the Company that the Company has
     received the 144 Documentation, the 904 Documentation or the Other
     Exemption Documentation (each as defined in the Securities Purchase
     Agreement) respecting the sale of such Shares.

     You are further instructed to notify the Secretary of the Company in
writing of any request that you receive pertaining to the proposed transfer of
any of the Shares.

     These instructions may not be rescinded or revoked other than by means of a
communication signed by the Company and the Investor in whose name the Shares in
question are registered.

     Please execute this letter in the space indicated to acknowledge your
agreement to act in accordance with these instructions. Should you have any
questions concerning this matter, please contact me at (414) 570-4001 or Patrick
Quick of Foley & Lardner, our outside legal counsel, at (414) 297-5678.

                                    Very truly yours,

                                    MIDWEST EXPRESS HOLDINGS, INC.

                                    By:
                                        ----------------------------------------
                                        Robert S. Bahlman, Senior Vice President
                                          and Chief Financial Officer

THE FOREGOING INSTRUCTIONS ARE
ACKNOWLEDGED AND AGREED TO

this ___ day of _______, 2003

American Stock Transfer & Trust Company

By:_______________________________
     Name:__________________________
     Title: __________________________

Enclosures

<PAGE>
                                    EXHIBIT I
                                    ---------

                    LIST OF INVESTORS AND SHARES TO BE ISSUED

                          [LIST OF INVESTORS OMITTED]

<PAGE>
                                   EXHIBIT II
                                   ----------

                         FORM OF NOTICE OF EFFECTIVENESS
                            OF REGISTRATION STATEMENT

American Stock Transfer & Trust Company
59 Maiden Lane
Plaza Level
New York, NY 10038
Attn:    _____________________

     Re: Midwest Express Holdings, Inc.

Ladies and Gentlemen:

     We are counsel to Midwest Express Holdings, Inc., a Wisconsin corporation
(the "Company"), and have represented the Company in connection with the Company
negotiating and executing that certain Securities Purchase Agreement, dated as
of September 29, 2003, by and among the investors named on the signature pages
thereto (the "Investors") and the Company (the "Purchase Agreement"). Upon the
terms and subject to the conditions of the Purchase Agreement, the Company has
agreed to sell to the Investors 1,882,353 shares of the Company's common stock,
par value $.01 per share (and, together with any associated Rights (as defined
in the Purchase Agreement), the "Securities"). Pursuant to the Purchase
Agreement, the Company entered into a Registration Rights Agreement with the
Investors, dated as of September 29, 2003 (the "Registration Rights Agreement"),
pursuant to which the Company agreed, among other things, to register the
Securities under the Securities Act of 1933, as amended (the "Securities Act").
In connection with the Company's obligations under the Registration Rights
Agreement, on _______ ___, 2003, the Company filed the Registration Statement on
Form S-1 (File No. 333-_________) (the "Registration Statement") with the
Securities and Exchange Commission (the "SEC"). The Registration Statement
registers the Securities for resale under the Securities Act and names each of
the Investors as a selling shareholder thereunder.

     In connection with the Registration Statement, we advise you that a member
of the SEC's staff has advised us by telephone that the SEC has entered an order
declaring the Registration Statement effective under the Securities Act at
[ENTER TIME OF EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS], and we have no
knowledge, after telephonic inquiry of a member of the SEC's staff, that any
stop order suspending its effectiveness has been issued or that any proceedings
for that purpose are pending before, or threatened by, the SEC and the
Registrable Securities are available for resale under the Securities Act
pursuant to the Registration Statement.

                                          Very truly yours,

                                          [COMPANY'S COUNSEL]

                                          By:_____________________

     CC: [LIST NAMES OF INVESTORS]

                                       6

<PAGE>
                                   EXHIBIT B

           Matters to be Covered in Opinion of Counsel to the Company

1.   Based solely on a certificate of the Wisconsin Department of Financial
     Institutions dated _______ ___, 2003, the Company is a corporation validly
     existing under the laws of the State of Wisconsin and has filed its most
     recent required annual report, and has not filed articles of dissolution
     with the Wisconsin Department of Financial Institutions.

2.   The Company has all requisite corporate power and authority to execute and
     deliver the Transaction Documents and perform its obligations thereunder.
     The Transaction Documents have been duly authorized by all necessary
     corporate action on the part of the Company and have been duly executed and
     delivered by the Company.

3.   Each of the Transaction Documents constitutes the legal, valid and binding
     obligation of the Company enforceable against the Company in accordance
     with their respective terms subject to applicable bankruptcy, fraudulent
     conveyance or transfer, insolvency and similar laws affecting creditors'
     rights generally, and subject, as to enforceability, to general principles
     of equity (regardless of whether enforcement is sought in a proceeding in
     equity or at law), except as enforceability of rights under the Transaction
     Documents to indemnity and contribution may be limited by law and except
     that we express no opinion as to the enforceability of such rights under
     the federal securities laws.

4.   The execution and delivery of, and performance by the Company of its
     obligations under, the Transaction Documents do not (i) constitute a breach
     or violation of the organizational documents of the Company; (ii) to our
     knowledge, constitute a default under, or give to others any rights of
     termination, amendment, acceleration or cancellation of, any agreement,
     indenture or other written instrument of the Company currently in effect
     that is attached as an exhibit to the SEC Documents; or (iii) to our
     knowledge, result in any violation of any order, judgment, injunction,
     decree or other restriction of any court or governmental authority which
     order, judgment, injunction, decree or other restriction is specifically
     applicable to the Company.

5.   The Shares to be issued to the Investors pursuant to the Purchase Agreement
     have been duly authorized and, when issued and paid for in accordance with
     the terms of the Purchase Agreement, will be validly issued, fully paid and
     nonassessable (except as otherwise provided by Section 180.0622(2)(b) of
     the Wisconsin Business Corporation Law).

6.   The issuance and sale of the Shares under the circumstances contemplated by
     the Purchase Agreement is exempt from the registration requirements of the
     Securities Act of 1933, as amended, pursuant Section 4(2) of the Securities
     Act.

<PAGE>
                                    EXHIBIT C

                          Registration Rights Agreement

See attached Exhibit 4.8 to this Current Report on Form 8-K.

<PAGE>
                                  Schedule 3.7
                                  ------------

     On September 25, 2003, the Milwaukee Journal Sentinel published a news
article, titled "Midwest Airlines won't fly with Eagle: Shared ticket agreement
to lapse," reporting that Midwest's codeshare agreement with American Eagle will
terminate in February 2004. The Company plans to file a press release to
acknowledge that the codeshare agreement with American Eagle will terminate and
indicate that the Company believes this arrangement will generate revenue in
fiscal 2003 that constitutes less than 1/2 of 1% of the Company's consolidated
2002 revenue.EXECUTION COPY

                          REGISTRATION RIGHTS AGREEMENT

     This REGISTRATION RIGHTS AGREEMENT, dated as of September 29, 2003 (this
"Agreement"), is made by and among Midwest Express Holdings, Inc., a Wisconsin
corporation (the "Company"), with headquarters located at 6744 South Howell
Avenue, Oak Creek, WI 53154, and the investors named on the signature pages
hereto (each of whom is hereinafter referred to as an "Initial Investor" and all
of whom collectively are hereinafter referred to as the "Initial Investors").

                                    RECITALS:

     A. In connection with the Securities Purchase Agreement, dated September
29, 2003, by and among the Initial Investors and the Company (the "Purchase
Agreement"), the Company has agreed, upon the terms and subject to the
conditions of the Purchase Agreement, to sell to the Initial Investors 1,882,353
shares of the Company's common stock, par value $.01 per share (the "Common
Shares" and, together with any associated Rights (as defined in the Purchase
Agreement), the "Securities").

     B. To induce the Initial Investors to execute and deliver the Purchase
Agreement, the Company has agreed to provide certain registration rights under
the Securities Act of 1933, as amended (the "Securities Act"), and applicable
state securities laws with respect to the Securities.

                                   AGREEMENT:

     In consideration of the premises and the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Company and each of the Initial Investors hereby
agree as follows:

                                   ARTICLE I
                                  DEFINITIONS

     As used in this Agreement, the following terms have the following meanings:

     1.1. "Agreement" has the meaning set forth in the introduction to this
Agreement.

     1.2. "Automatic Grace Period" has the meaning set forth in Section 3.6(b).

     1.3. "Business Day" means any day other than a Saturday, Sunday or other
day on which the SEC is authorized or required by law to remain closed.

     1.4. "Claims" has the meaning set forth in Section 6.1.

     1.5. "Closing Date" has the meaning set forth in the Purchase Agreement.

     1.6. "Common Shares" has the meaning set forth in Recital A.

     1.7. "Company" has the meaning set forth in the introduction to this
Agreement.

     1.8. "Company Indemnified Person" has the meaning set forth in Section 6.2.

     1.9. "Company Representative" has the meaning set forth in Section 3.9.

<PAGE>
     1.10. "Continuing Late Effective Payment" has the meaning set forth in
Section 2.4(a).

     1.11. "Event" has the meaning set forth in Section 3.6(a).

     1.12. "Excess Suspension Payment" has the meaning set forth in Section
2.4(b).

     1.13. "Exchange Act" has the meaning set forth in Section 1.21.

     1.14. "Force Majeure" has the meaning set forth in Section 2.5.

     1.15. "Fund" has the meaning set forth in Section 11.14.

     1.16. "Grace Period" means an Automatic Grace Period or an Optional Grace
Period.

     1.17. "Indemnified Person" has the meaning set forth in Section 6.3.

     1.18. "Initial Investor" or "Initial Investors" have the respective
meanings set forth in the introduction to this Agreement.

     1.19. "Inspectors" has the meaning set forth in Section 3.8.

     1.20. "Inspector Representative" has the meaning set forth in Section
3.8(b).

     1.21. "Investors" means the Initial Investors and any of their permitted
transferees or assignees under Article IX who receive or acquire Registrable
Securities and agree to become bound by the provisions of this Agreement in
accordance with Article IX, but only for so long as such person holds
Registrable Securities, except as otherwise provided in Article VI; provided
that no such person is registered as a broker or dealer under Section 15(a) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or is a
member of the National Association of Securities Dealers, Inc.

     1.22. "Investor Delay" has the meaning set forth in Section 2.4(b).

     1.23. "Investor Indemnified Person" has the meaning set forth in Section
6.1.

     1.24. "Investor Representative" has the meaning set forth in Section
3.6(a).

     1.25. "Investors' Legal Counsel" has the meaning set forth in Section 2.6.

     1.26. "NYSE" means the New York Stock Exchange.

     1.27. "Optional Grace Period" has the meaning set forth in Section 3.6(c).

     1.28. "Plan of Distribution" has the meaning set forth in Section 2.1.

     1.29. "Purchase Agreement" has the meaning set forth in Recital A.

     1.30. "Records" has the meaning set forth in Section 3.8.

     1.31. The terms "register," "registered," and "registration" refer to a
registration effected by preparing and filing the Registration Statement in
compliance with the Securities Act and, in particular, pursuant to Rule 415
under the Securities Act and the declaration or ordering of effectiveness of
such Registration Statement by the United States Securities and Exchange
Commission (the "SEC").

                                       2
<PAGE>
     1.32. "Registrable Securities" means the Common Shares sold pursuant to the
Purchase Agreement, any shares of capital stock issued or issuable from time to
time (with any adjustments) in exchange for or otherwise with respect to the
Common Shares and any associated Rights (as defined in the Purchase Agreement),
except that any such securities will cease to be Registrable Securities at such
time as they have been sold under the Registration Statement or pursuant to Rule
144 under the Securities Act or otherwise or at such time as they are eligible
to be sold pursuant to Rule 144(k).

     1.33. "Registration Period" has the meaning set forth in Section 3.1.

     1.34. "Registration Statement" means the Registration Statement(s) of the
Company filed with the SEC under the Securities Act pursuant to Section 2.1,
including all amendments (pre-effective or post-effective) and supplements
thereto and all documents incorporated by reference therein.

     1.35. "Required Effective Date" has the meaning set forth in Section 2.2.

     1.36. "Required Filing Date" has the meaning set forth in Section 2.1.

     1.37. "Rights" has the meaning set forth in Recital A.

     1.38. "Rule 415" means Rule 415 under the Securities Act, or any successor
rule providing for offering securities on a continuous basis, and applicable
rules and regulations thereunder.

     1.39. "Rule 144" means Rule 144 under the Securities Act, or any successor
rule, and any applicable rules and regulations thereunder.

     1.40. "Securities" has the meaning set forth in Recital A.

     1.41. "Securities Act" has the meaning set forth in Recital B.

     1.42. "SEC" has the meaning set forth in Section 1.31.

     1.43. "Violations" has the meaning set forth in Section 6.1.

                                   ARTICLE II
                                  REGISTRATION

     2.1. Mandatory Registration. The Company will use its reasonable best
efforts to prepare and file the Registration Statement with the SEC within five
(5) Business Days after the Closing Date (the "Required Filing Date"), on Form
S-3, if available, registering all of the Registrable Securities for resale in
accordance with the "Plan of Distribution" attached hereto as Exhibit A. This
Registration Statement shall register only the Registrable Securities. If Form
S-3 is not available at that time, then the Company will use its reasonable best
efforts to file the Registration Statement by the Required Filing Date on such
form as is then available to effect a registration of the Registrable
Securities.

     2.2. Effectiveness of the Registration Statement. The Company will use its
reasonable best efforts to cause the Registration Statement contemplated by the
previous Section to be declared effective by the SEC within sixty (60) calendar
days after the Closing Date and in any event no later than ninety (90) calendar
days after the Closing Date (the "Required Effective Date"). The Company's
reasonable best efforts will include, but are not to be limited to, promptly
responding to all comments received from the staff of the SEC.

                                       3
<PAGE>
     2.3. Ineligibility for Form S-3. The Company does not currently meet the
requirements for the use of Form S-3 for registration of the resale by the
Investors of the Registrable Securities. The Company represents, warrants and
covenants that it has filed and will use its reasonable best efforts to file all
reports required to be filed by the Company with the SEC in a timely manner so
as to obtain, as soon as practicable, and then maintain eligibility for the use
of Form S-3. In the event that Form S-3 is not available for the registration of
the resale of Registrable Securities hereunder, the Company shall (i) register
the resale of the Registrable Securities on Form S-1 or on another appropriate
form reasonably acceptable to the holders of at least two-thirds of the
Registrable Securities and (ii) undertake to convert such Registration Statement
on Form S-1 (or such other appropriate form) to the Registration Statement on
Form S-3 as soon as the Company is eligible to register the resale of the
Registrable Securities on Form S-3.

     2.4. Effect of Failure to File and Obtain and Maintain Effectiveness of
Registration Statement.

          (a) If the Registration Statement has not been declared effective by
     the Required Effective Date, then the Company will make one or more
     payments to each Investor under this subsection (a) (each, a "Continuing
     Late Effective Payment"). The Continuing Late Effective Payment for each
     Investor for each calendar month after the Required Effective Date that the
     Registration Statement has not been declared effective will be an amount
     equal to 1.00% of the purchase price paid for the Common Shares purchased
     by such Investor that are held by such Investor on the respective last
     calendar day of the period to which the Continuing Late Effective Payment
     in question relates. The Continuing Late Effective Payment will be prorated
     on a daily basis for periods less than a calendar month. Subject to
     subsection (c), the Company will make the Continuing Late Effective Payment
     to each Investor by check (or by wire transfer if the payment exceeds
     $10,000 in amount and the Company has wire transfer instructions from the
     Investor) within ten (10) Business Days following the end of each calendar
     month as to which payment hereunder is due.

          (b) Except in connection with any conversion of the Registration
     Statement from Form S-1 (or another form) to Form S-3 pursuant to Section
     2.3 and except in connection with any delays that are attributable to
     changes to the Plan of Distribution pursuant to Section 3.12 and any delays
     that are attributable to amendments to the Registration Statement to
     include an Investor's Registrable Securities pursuant to Section 4.1 (each,
     an "Investor Delay"), if at any time during the Registration Period, on any
     day after such Registration Statement has been declared effective by the
     SEC, sales of all the Registrable Securities required to be included in
     such Registration Statement cannot be made for a period of more than thirty
     (30) Business Days in the aggregate during any 12-month period (other than
     during a Grace Period or any Investor Delay) pursuant to such Registration
     Statement (including, without limitation, because of a failure to keep such
     Registration Statement effective, to disclose such information as is
     necessary for sales to be made pursuant to such Registration Statement or
     to register sufficient Common Shares), then the Company will make a payment
     to each Investor (each, an "Excess Suspension Payment"). The Excess
     Suspension Payment for each Investor for each thirty (30) Business Day
     period during which sales cannot be made in excess of such thirty (30)
     Business Day period will be an amount equal to 1.00% of the purchase price
     paid for the Common Shares purchased by such Investor that are held by such
     Investor on the respective last Business Day of the thirty (30) Business
     Day period in question. The Excess Suspension Payment will be prorated on a
     daily basis for periods less than thirty (30) Business Days. Subject to
     subsection (c), the Company will make the Excess Suspension Payment to each
     Investor by check (or by wire transfer if the payment exceeds $10,000 in
     amount and the Company has wire transfer instructions from the

                                       4
<PAGE>
     Investor) within ten (10) Business Days following the end of each thirty
     (30) Business Day period as to which payment hereunder is due.

          (c) Upon the reasonable request of the Company in writing, an Investor
     shall promptly deliver to the Company in writing information regarding the
     Investor's Common Shares (together with reasonable supporting
     documentation) to enable the Company to calculate the amount of any payment
     due under this Section 2.4. Until the Investor has responded to such a
     reasonable request, the Company may withhold any payment due under this
     Section 2.4 until the fourth Business Day after the Investor delivers such
     information.

          (d) The Investors may make a claim for additional damages as a remedy
     for the Company's failure to comply with the timelines relating to the
     Registration Statement set forth in this Agreement, but acknowledgement of
     such right in this Agreement shall not constitute an admission by the
     Company that any such damages exist or may exist. Notwithstanding the
     foregoing, if the Company has used its reasonable best efforts to avoid
     circumstances as a result of which the Registration Statement has not been
     declared effective by the Required Effective Date or sales cannot be made
     under the Registration Statement during the Registration Period (other than
     during a Grace Period or any Investor Delay), then the damages described
     above shall be the Investors' sole and exclusive remedy for damages arising
     out of such circumstances. Nothing contained in the preceding sentence
     shall be read to limit the ability of the Investors to seek specific
     performance of this Agreement.

     2.5. Force Majeure. The Company shall not be deemed in breach of its
commitments under Article II and no payments by the Company as set forth in
Article II shall be required to the extent that the Company is unable to fulfill
its obligations hereunder in a timely fashion because the SEC and/or the NYSE
are closed or operating on a limited basis as a result of the occurrence of a
Force Majeure. As used herein, "Force Majeure" means (i) war or armed
hostilities or other national or international calamity, or one or more acts of
terrorism, or (ii) a natural disaster or storm.

     2.6. Investors' Legal Counsel. Subject to Article V, the Company will
permit a single firm of legal counsel, designated in writing by the Investors
holding a majority in interest of Registrable Securities (such firm of legal
counsel, or any properly designated successor, "Investors' Legal Counsel"), to
review and oversee any registration pursuant to this Article II, which shall
initially be Quarles & Brady LLP. The Company and Investors' Legal Counsel shall
reasonably cooperate with each other in performing the Company's obligations
under this Agreement.

                                  ARTICLE III
                     ADDITIONAL OBLIGATIONS OF THE COMPANY

     At such time as the Company is obligated to file the Registration Statement
with the SEC pursuant to Section 2.1, the Company will use its best efforts to
effect the registration of the Registrable Securities in accordance with the
intended method of disposition thereof and, pursuant thereto, the Company shall
have the following obligations:

     3.1. Acceleration of Effectiveness. The Company shall submit to the SEC,
within three (3) Business Days after the Company learns that no review of the
Registration Statement will be made by the staff of the SEC or that the staff
has no further comments on the Registration Statement, as the case may be, a
request for acceleration of effectiveness of such Registration Statement to a
time and date not later than 48 hours after the submission of such request.
Notwithstanding anything else in this Agreement to the contrary, the Company
shall notify each representative of an Investor named on such Investor's
signature page, if any, of the effectiveness of the Registration Statement on
the same day that the SEC notifies the Company that it has declared the
Registration Statement effective (the Company will

                                       5
<PAGE>
send such notice as soon as reasonably possible on the day that the Registration
Statement is declared effective, and in any event no later than 5:00 p.m.,
Central Time, on such day). The Company shall keep the Registration Statement
effective pursuant to Rule 415 at all times until the earlier of (i) the date as
of which the Investors may sell all of the Registrable Securities covered by
such Registration Statement without restriction pursuant to Rule 144(k) (or
successor thereto) promulgated under the Securities Act or (ii) the date on
which the Investors shall have sold all the Registrable Securities covered by
such Registration Statement (the "Registration Period"). The Company shall
ensure that the Registration Statement (including any amendments or supplements
thereto and prospectuses contained therein) shall not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein, or necessary to make the statements therein (in the case of
prospectuses, in the light of the circumstances in which they were made) not
misleading.

     3.2. Compliance with Securities Act. The Company will comply with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by such Registration Statement until such time as
all of such Registrable Securities shall have been disposed of in accordance
with the intended methods of disposition by the seller or sellers thereof as set
forth in such Registration Statement or such securities shall cease to be
Registrable Securities.

     3.3. Pre-filing Review of Registration Statement. The Company shall (a)
permit Investors' Legal Counsel to review and comment upon (i) the Registration
Statement by delivering a draft thereof at least five (5) Business Days prior to
its filing with the SEC and (ii) all amendments and supplements to all
Registration Statements (except for Annual Reports on Form 10-K, Quarterly
Reports on Form l0-Q and Current Reports on Form 8-K and any similar or
successor reports) by delivering drafts thereof within a reasonable number of
days prior to their filing with the SEC, and (b) not file the Registration
Statement or amendment or supplement thereto in a form to which Investors' Legal
Counsel reasonably objects. Except as may be required under Section 3.1, the
Company shall not submit a request for acceleration of the effectiveness of the
Registration Statement or any amendment or supplement thereto without the prior
approval of Investors' Legal Counsel, which consent shall not be unreasonably
withheld. The Company shall furnish to Investors' Legal Counsel, without charge,
(x) copies of any correspondence from the SEC or the staff of the SEC to the
Company or its representatives relating to the Registration Statement, (y) as
promptly as possible after the same is prepared and filed with the SEC, one copy
of the Registration Statement and any amendment(s) thereto, including financial
statements and schedules, all documents incorporated therein by reference, if
requested by an Investor, and all exhibits and (z) upon the effectiveness of the
Registration Statement, one copy of the prospectus included in such Registration
Statement and all amendments and supplements thereto. The Company shall
reasonably cooperate with Investors' Legal Counsel in performing the Company's
obligations pursuant to this Article III.

     3.4. Copies of Registration Statement and Prospectus. The Company shall
furnish to each Investor whose Registrable Securities are included in the
Registration Statement, without charge, (i) promptly after the same is prepared
and filed with the SEC, at least one copy of such Registration Statement and any
amendment(s) thereto, including financial statements and schedules, all
documents incorporated therein by reference, if requested by an Investor, all
exhibits and each preliminary prospectus, (ii) upon the effectiveness of the
Registration Statement, ten (10) copies of the prospectus included in such
Registration Statement and all amendments and supplements thereto (or such other
number of copies as such Investor may reasonably request) and (iii) such other
documents, including copies of any preliminary or final prospectus, as such
Investor may reasonably request from time to time to facilitate the disposition
of the Registrable Securities owned by such Investor.

     3.5. Blue Sky Laws. The Company shall use its best efforts to (i) register
and qualify, unless an exemption from registration and qualification applies,
the resale by Investors of the Registrable Securities covered by the
Registration Statement under such other securities or "blue sky" laws of all

                                       6
<PAGE>
applicable jurisdictions in the United States, (ii) prepare and file in those
jurisdictions such amendments (including post-effective amendments) and
supplements to such registrations and qualifications as may be necessary to
maintain the effectiveness thereof during the Registration Period, (iii) take
such other actions as may be necessary to maintain such registrations and
qualifications in effect at all times during the Registration Period, and (iv)
take all other actions reasonably necessary or advisable to qualify the
Registrable Securities for sale in such jurisdictions; provided, however, that
the Company shall not be required in connection therewith or as a condition
thereto to (v) qualify to do business in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3.5, (w) subject itself to
general taxation in any such jurisdiction (x) file a general consent to service
of process in any such jurisdiction, (y) provide any undertakings that cause
material expense or burden to the Company, or (z) make any change in its charter
or bylaws. The Company shall promptly notify Investors' Legal Counsel and each
Investor who holds Registrable Securities of the receipt by the Company of any
notification with respect to the suspension of the registration or qualification
of any of the Registrable Securities for sale under the securities or "blue sky"
laws of any jurisdiction in the United States or its receipt of actual notice of
the initiation or threatening of any proceeding for such purpose.

     3.6. Suspension of Sale and Resale Rights.

          (a) During the Registration Period, the Company will notify by
     facsimile Investors' Legal Counsel and each Investor who holds Registrable
     Securities being sold pursuant to the Registration Statement of the
     happening of any event (except as provided in Section 3.6(c)), as promptly
     as practicable after becoming aware of such event, as a result of which the
     prospectus included in the Registration Statement, as then in effect,
     includes an untrue statement of a material fact or omission to state a
     material fact required to be stated therein or necessary to make the
     statements therein, in light of the circumstances under which they were
     made, not misleading (each an "Event"). Such notice shall not contain any
     material, nonpublic information, and in no event will the Company disclose
     to any Investor any of the facts or circumstances regarding any Event. Each
     Investor will hold in confidence and will not make any disclosure of any
     Event and any related information disclosed by the Company unless (i) the
     release of such information is ordered pursuant to a final, non-appealable
     subpoena or other final, non-appealable order from a court or government
     body of competent jurisdiction, (ii) the information has been made
     generally available to the public other than by disclosure in violation of
     this or any other agreement (to the knowledge of the relevant Investor),
     (iii) the information was developed independently by an Investor without
     breach of this Agreement, (iv) the information was known to the Investor
     before receipt of such information from the Company or (v) the information
     was disclosed to the Investor by a third party not under an obligation of
     confidentiality. However, an Investor may make disclosure of an Event
     and/or any related information disclosed by the Company to any attorney,
     adviser or other third party retained by it that needs to know the
     information, as determined in good faith by the Investor ("Investor
     Representative"), if the Investor advises the Investor Representative of
     the confidentiality provisions of this Section 3.6(a), but the Investor
     will be liable for any act or omission of any of its Investor
     Representatives relative to such information as if the act or omission was
     that of the Investor. Unless legally prohibited from so doing, each
     Investor will, upon learning that disclosure of such confidential
     information is sought in or by a court or governmental body of competent
     jurisdiction or through other means, give prompt notice to the Company and
     allow the Company, at the Company's expense, to undertake appropriate
     action to prevent disclosure of, or to obtain a protective order for, such
     confidential information.

          (b) If the Registration Statement ceases to be effective or the
     prospectus related thereto ceases to be usable at any time during the
     Registration Period, including as a result of the occurrence of an Event
     under Section 3.6(a), then the Company will promptly

                                       7
<PAGE>
     prepare and file with the SEC a supplement or amendment to such
     Registration Statement to correct such untrue statement or omission or to
     otherwise update and modify the Registration Statement and the prospectus
     as required by applicable law and use its reasonable best efforts to cause
     any post-effective amendment to the Registration Statement to be declared
     effective by the SEC as soon as reasonably practicable following the filing
     thereof. In any event, the Company shall file any such post-effective
     amendment within twelve (12) Business Days and any such supplement within
     four (4) Business Days, in each case after the Company becomes aware of the
     related circumstances. Sales and resales of Registrable Securities shall be
     suspended until the Company has filed such post-effective amendment or
     supplement to the Registration Statement or prospectus that cures such
     failure to be effective or useable and that is itself, in the case of a
     post-effective amendment, declared effective, and the Company will promptly
     notify Investors' Legal Counsel and each Investor of such suspension in
     writing. As used herein, "Automatic Grace Period" shall mean any of the
     following: (i) the twelve (12) Business Day period referred to above for
     the filing of an amendment or the four (4) Business Day period referred to
     above for the filing of a supplement; and (ii) the time from and including
     the filing of any such post-effective amendment and such post-effective
     amendment being declared effective, provided that in no event shall the
     period under this clause (ii) exceed ten (10) Business Days if such
     post-effective amendment receives no review by the SEC or twenty (20)
     business days if such post-effective amendment is reviewed by the SEC. The
     Company will also promptly notify Investors' Legal Counsel and each
     Investor in writing (A) when a prospectus or any prospectus supplement or
     post-effective amendment has been filed, and when the Registration
     Statement or any post-effective amendment has become effective
     (notification of such effectiveness shall be delivered to Investors' Legal
     Counsel and each Investor by facsimile on the same day of such
     effectiveness and by overnight mail), (B) of any request by the SEC for
     amendments or supplements to the Registration Statement or related
     prospectus or related information, and (C) of the Company's reasonable
     determination that a post-effective amendment to the Registration Statement
     would be appropriate.

          (c) Notwithstanding anything to the contrary herein, at any time after
     the Registration Statement has been declared effective by the SEC, the
     Company may delay the disclosure of material non-public information
     concerning the Company the disclosure of which at the time is not, in the
     good faith opinion of the Company following consultation with legal
     counsel, in the best interest of the Company and otherwise required (an
     "Optional Grace Period"), provided that the Company shall promptly (i)
     notify the Investors in writing of the existence of material non-public
     information giving rise to an Optional Grace Period (such notice shall not
     contain any material, nonpublic information, and in no event will the
     Company disclose to any Investor any of the related facts or circumstances)
     and the date on which the Optional Grace Period will begin and (ii) notify
     the Investors in writing of the date on which the Optional Grace Period
     ends; and, provided further, that no Optional Grace Period shall exceed
     forty-five (45) consecutive calendar days and during any three hundred
     sixty-five (365) day period such Optional Grace Periods shall not exceed an
     aggregate of sixty (60) calendar days and the first day of any Optional
     Grace Period must be at least five (5) Business Days after the last day of
     any prior Optional Grace Period. For purposes of determining the length of
     an Optional Grace Period, the Optional Grace Period shall begin on and
     include the date the Investors receive the notice referred to in clause (i)
     and shall end on and include the later of the date the Investors receive
     the notice referred to in clause (ii) and the date referred to in such
     notice. Section 3.6(a) shall not be applicable during the period of any
     Optional Grace Period. Upon expiration of an Optional Grace Period, the
     Company shall again be bound by Section 3.6(a) with respect to any Event
     giving rise to material non-public information concerning the Company
     unless disclosing any such Event is no longer applicable. Notwithstanding
     anything to the contrary in this Agreement, the Company shall

                                       8
<PAGE>
     cause its transfer agent to deliver unlegended Common Shares to a
     transferee of an Investor in accordance with the terms of the Securities
     Purchase Agreement in connection with any sale of Registrable Securities
     with respect to which an Investor has entered into a contract for sale, and
     delivered a copy of the prospectus included as part of the applicable
     Registration Statement, prior to the Investor's receipt of the notice of an
     Optional Grace Period and for which the Investor has not yet settled.

     3.7. Stop Orders and Suspensions of Effectiveness. Subject to the Company's
rights under Section 3.6, the Company shall use its reasonable best efforts to
prevent the issuance of any stop order or other suspension of effectiveness of
the Registration Statement, or the suspension of the qualification of any of the
Registrable Securities for sale in any jurisdiction and, if such an order or
suspension is issued, to obtain the withdrawal of such order or suspension at
the earliest possible moment. As soon as practicable, and in any event within
two (2) Business Days after the Company receives notice of the issuance of such
an order or suspension, the Company will notify Investors' Legal Counsel and
each Investor of the issuance of such order and the resolution thereof or its
receipt of actual notice of the initiation or threat of any proceeding for such
purpose.

     3.8. Inspection of Records; Confidentiality.

          (a) During the Registration Period, the Company shall make available
     for inspection during normal business hours and upon two (2) Business Days
     prior notice by (i) any Investor, (ii) Investors' Legal Counsel and (iii)
     one (1) firm of accountants or other agents reasonably acceptable to the
     Company and retained by the Investors (collectively, the "Inspectors") all
     pertinent financial and other records, and pertinent corporate documents
     and properties of the Company (collectively, the "Records") as shall be
     reasonably deemed necessary by each Inspector to enable each Inspector to
     exercise its due diligence responsibility in connection with or related to
     the contemplated offering. The Company will cause the Company's officers,
     directors and employees to supply all information that any Inspector may
     reasonably request for purposes of performing such due diligence.

          (b) Each Inspector will hold in strict confidence, use only in
     connection with the contemplated offering and not make any disclosure
     (except to an Investor) of any Records or other information that the
     Company determines in good faith to be confidential, and of which
     determination the Inspectors are so notified, unless (i) the disclosure of
     such Records is necessary to avoid or correct a misstatement or omission in
     the Registration Statement or is otherwise required under the Securities
     Act, (ii) the release of such Records is ordered pursuant to a final,
     non-appealable subpoena or other final, non-appealable order from a court
     or government body of competent jurisdiction, (iii) the information in such
     Records has been made generally available to the public other than by
     disclosure in violation of this or any other agreement (to the knowledge of
     the relevant Inspector), (iv) the Records or other information was
     developed independently by an Inspector without breach of this Agreement,
     (v) the information was known to the Inspector before receipt of such
     information from the Company, or (vi) the information was disclosed to the
     Inspector by a third party not under an obligation of confidentiality.
     However, an Inspector may make disclosure of such Records and other
     information to any attorney, adviser or other third party retained by it
     that needs to know the information, as determined in good faith by the
     Inspector ("Inspector Representative"), if the Inspector advises the
     Inspector Representative of the confidentiality provisions of this Section
     3.8(b), but the Inspector will be liable for any act or omission of any of
     its Inspector Representatives relative to such information as if the act or
     omission was that of the Inspector. Unless legally prohibited from so
     doing, each Investor will, upon learning that disclosure of Records
     containing confidential information is sought in or by a court or
     governmental body of competent jurisdiction or through other means, give
     prompt

                                       9
<PAGE>
     written notice to the Company and allow the Company, at the Company's
     expense, to undertake appropriate action to prevent disclosure of, or to
     obtain a protective order for, the Records deemed confidential. Nothing
     herein (or in any other confidentiality agreement between the Company and
     any Investor) shall be deemed to limit the Investors' ability to sell
     Registrable Securities in a manner that is otherwise consistent with
     applicable laws and regulations.

     3.9. Disclosure of Investors' Information. The Company will hold in
confidence, and will not make any disclosure of, information concerning an
Investor provided to the Company under this Agreement unless (i) the Company
reasonably determines disclosure of such information is necessary to comply with
federal or state securities laws, or any exchange listing or similar rules and
regulations, (ii) the disclosure of such information is necessary to avoid or
correct a misstatement or omission in the Registration Statement, (iii) the
release of such information is ordered pursuant to a final, non-appealable
subpoena or other final, non-appealable order from a court or governmental body
of competent jurisdiction, (iv) such information has been made generally
available to the public other than by disclosure in violation of this Agreement
or any other agreement, (v) the information was disclosed to the Company by a
third party not under an obligation of confidentiality or (vi) such Investor
consents to the form and content of any such disclosure. However, the Company
may make disclosure of such information to any attorney, adviser or other third
party retained by it that needs to know the information, as determined in good
faith by the Company ("Company Representative"), if the Company advises the
Company Representative of the confidentiality provisions of this Section 3.9,
but the Company will be liable for any act or omission of any Company
Representatives relative to such information as if the act or omission was that
of the Company. If the Company learns that disclosure of such information
concerning an Investor is sought in or by a court or governmental body of
competent jurisdiction or through other means, the Company will (unless legally
prohibited from so doing) give prompt written notice to such Investor prior to
making such disclosure and allow such Investor, at the Investor's expense, to
undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, such information.

     3.10. Listing of Registrable Securities. During the Registration Period,
the Company shall use its reasonable best efforts to maintain the listing of all
of the Registrable Securities on the principal securities exchange or market or
trading system, if any, on which the Common Shares are then listed or traded.

     3.11. Delivery of Certificates. The Company shall cooperate with the
Investors and, to the extent applicable, facilitate the timely preparation and
delivery of certificates (not bearing any restrictive legend) representing the
Registrable Securities to be offered pursuant to the Registration Statement and
enable such certificates to be in such denominations or amounts, as the case may
be, as the Investors may reasonably request and registered in such names as the
Investors may reasonably request.

     3.12. Updates to Plan of Distribution. At the request of any Investor,
provided that Investors holding a majority in interest of the Registrable
Securities registered pursuant to the Registration Statement consent, the
Company will promptly prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to the Registration Statement, and
the prospectus used in connection with the Registration Statement, as may be
necessary to change the Plan of Distribution set forth in such Registration
Statement.

     3.13. Other Governmental Approvals. The Company shall use reasonable
efforts to cause the Registrable Securities covered by the Registration
Statement to be registered with or approved by such other governmental agencies
or authorities as may be necessary to consummate the disposition of such
Registrable Securities.

                                       10
<PAGE>
     3.14. Best Efforts of Company. The Company shall use its best efforts to
comply with all applicable rules and regulations of the SEC in connection with
any registration hereunder.

     3.15. Confirmation Upon Effectiveness. Within two (2) Business Days after
the Registration Statement that covers Registrable Securities is ordered
effective by the SEC, the Company shall deliver, and shall cause legal counsel
for the Company to deliver, to the transfer agent for such Registrable
Securities (with copies to the Investors whose Registrable Securities are
included in such Registration Statement) confirmation that such Registration
Statement has been declared effective by the SEC in the form attached hereto as
Exhibit B.

                                   ARTICLE IV
                          OBLIGATIONS OF THE INVESTORS

     4.1. Investor Information. As a condition to the obligations of the Company
to complete any registration pursuant to this Agreement with respect to the
Registrable Securities of each Investor, such Investor will furnish to the
Company such information regarding itself, the Registrable Securities held by it
and the intended methods of disposition of the Registrable Securities held by it
as is reasonably required by the Company to effect the registration of the
Registrable Securities. At least five (5) Business Days prior to the first
anticipated filing date of the Registration Statement for any registration under
this Agreement, the Company will notify each Investor of the information the
Company requires from that Investor whether or not such Investor has elected to
have any of its Registrable Securities included in the Registration Statement.
If the Company has not received the requested information from an Investor by
the Business Day prior to the anticipated filing date, then the Company may file
the Registration Statement without including Registrable Securities of that
Investor.

     4.2. Further Assurances. Each Investor will cooperate with the Company, as
reasonably requested by the Company, in connection with the preparation and
filing of the Registration Statement hereunder, unless such Investor has
notified the Company in writing of such Investor's irrevocable election to
exclude all of such Investor's Registrable Securities from such Registration
Statement.

     4.3. Suspension of Sales. Upon receipt of any notice from the Company under
Section 3.6, each Investor will immediately discontinue the disposition of
Registrable Securities pursuant to the Registration Statement covering such
Registrable Securities until (i) it receives copies of a supplemented or amended
prospectus contemplated by Section 3.6 or (ii) the Company advises the Investor
that a suspension of sales under Section 3.6 has terminated. If so directed by
the Company, each Investor will deliver to the Company (at the expense of the
Company) or destroy all copies in the Investor's possession (other than a
limited number of file copies) of the prospectus covering such Registrable
Securities that is current at the time of receipt of such notice.

                                   ARTICLE V
                            EXPENSES OF REGISTRATION

     During the Registration Period, in connection with registrations, filings
or qualifications pursuant to Article II and Article III, the Company will bear
(i) all reasonable expenses (other than underwriting discounts and commissions,
and transfer taxes, if any) incurred in connection with registrations, filings
or qualifications pursuant to Article II and Article III of this Agreement,
including, without limitation, all registration, listing and qualifications
fees, printers and accounting fees; (ii) the fees and disbursements of legal
counsel for the Company; and (iii) the reasonable fees and disbursements of
Investors' Legal Counsel (not to exceed in the aggregate $10,000).

                                       11
<PAGE>
                                   ARTICLE VI
                                INDEMNIFICATION

     In the event that any Registrable Securities are included in the
Registration Statement under this Agreement:

     6.1. Indemnification of the Investors. To the extent permitted by law, the
Company will indemnify and hold harmless each Investor, any underwriter (as
defined in the Securities Act) for the Investors, any directors or officers of
such Investor (including for purposes of this Article VI any person who was an
Investor) and any person who controls such Investor within the meaning of the
Securities Act or the Exchange Act or acts as such Investor's investment advisor
(each, an "Investor Indemnified Person") against any losses, claims, damages,
expenses or liabilities (joint or several) (collectively, and together with
actions, proceedings or inquiries by any regulatory or self-regulatory
organization, whether commenced or threatened in respect thereof, "Claims") to
which any of them become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such Claims arise out of or are based upon any of the
following statements, omissions or violations in the Registration Statement
filed pursuant to this Agreement, any post-effective amendment thereof or any
prospectus included therein: (a) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
post-effective amendment thereof or any final prospectus (as amended or
supplemented, if the Company files any amendment or supplement thereto with the
SEC) included therein or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading or (b) any violation or alleged violation by the Company of the
Securities Act, the Exchange Act or any other law related to the Registration
Statement, including without limitation any state securities law or any rule or
regulation thereunder (the matters in the foregoing clauses (a) and (b) being,
collectively, "Violations"). Subject to the restrictions set forth in Section
6.3 with respect to the number of legal counsel, the Company will reimburse the
Investors and each such underwriter or controlling person and each such other
Investor Indemnified Person, promptly as such expenses are incurred and are due
and payable, for any reasonable legal fees or other reasonable expenses incurred
by them in connection with investigating or defending any Claim. Notwithstanding
anything to the contrary contained herein, the indemnification agreement
contained in this Section 6.1: (i) does not apply to Claims arising out of or
based upon a Violation that occurs in reliance upon and in conformity with
written information furnished to the Company by or on behalf of an Investor or
Investor Indemnified Persons expressly for use in connection with the
preparation of the Registration Statement or any such amendment thereof or
supplement thereto, if such prospectus was timely made available by the Company
pursuant to Section 3.3; (ii) does not apply to a Claim arising out of or based
on any failure by an Investor or Investor Indemnified Persons to comply with
prospectus delivery requirements (or the Securities Act, the Exchange Act or any
other law or legal requirement applicable to sales under the Registration
Statement) or any covenant or agreement contained in the Purchase Agreement,
with respect to sales under the Registration Statement, or in this Agreement;
(iii) does not apply to a Claim arising from an offer or sale of Registrable
Securities occurring during a period in which sales are suspended in accordance
with Section 4.3; and (iv) does not apply to amounts paid in settlement of any
Claim if such settlement is made without the prior written consent of the
Company, which consent will not be unreasonably withheld or delayed. This
indemnity obligation will remain in full force and effect regardless of any
investigation made by or on behalf of the Investor Indemnified Persons and will
survive the transfer of the Registrable Securities by the Investors under
Article IX.

     6.2. Indemnification of the Company and Certain Shareholders. In connection
with the Registration Statement in which an Investor is participating, each such
Investor will indemnify and hold harmless, severally and not jointly, to the
same extent and in the same manner set forth in Section 6.1 above, the Company,
each of its directors, each of its officers who signs the Registration
Statement, each person, if any, who controls the Company within the meaning of
the Securities Act or the Exchange

                                       12
<PAGE>
Act, and any other shareholder selling securities pursuant to the Registration
Statement and any of its directors and officers and any person who controls such
shareholder within the meaning of the Securities Act or the Exchange Act (each a
"Company Indemnified Person") against any Claim to which any of them may become
subject under the Securities Act, the Exchange Act or otherwise, insofar as such
Claim arises out of or is based upon any of the following: (a) any matter of the
type referred to in clause (a) in Section 6.1 above in each case to the extent
(and only to the extent) that such violation occurs in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Investor or its Investor Indemnified Persons expressly for use in
connection with the preparation of the Registration Statement or any such
amendment thereof or supplement thereto, if such prospectus was timely made
available by the Company pursuant to Section 3.3; (b) any failure by such
Investor or its Investor Indemnified Persons to comply with prospectus delivery
requirements (or the Securities Act, the Exchange Act or any other law or legal
requirement applicable to sales under the Registration Statement) or any
covenant or agreement contained in the Purchase Agreement, with respect to sales
under the Registration Statement, or in this Agreement; or (c) any offer or sale
of Registrable Securities occurring during a period in which sales are suspended
in accordance with Section 4.3. Subject to the restrictions set forth in Section
6.3, such Investor will promptly reimburse any legal or other expenses, promptly
as such expenses are incurred and due and payable, reasonably incurred by them
in connection with investigating or defending any such Claim. However, the
indemnity agreement contained in this Section 6.2 does not apply to amounts paid
in settlement of any Claim if such settlement is effected without the prior
written consent of such Investor, which consent will not be unreasonably
withheld, and no Investor will be liable under this Agreement (including this
Section 6.2 and Article VII) for the amount of any Claim that exceeds the net
proceeds actually received by such Investor as a result of the sale of such
Investor's Registrable Securities. This indemnity will remain in full force and
effect regardless of any investigation made by or on behalf of the Company
Indemnified Persons and will survive the transfer of the Registrable Securities
by the Investors under Article IX.

     6.3. Notification and Other Indemnification Procedures. Promptly after
receipt by an Investor Indemnified Person or a Company Indemnified Person, as
the case may be (an "Indemnified Person"), under this Article VI of notice of
the commencement of any action (including any governmental action), such
Indemnified Person will, if a Claim in respect thereof is to be made against any
indemnifying party under this VI, deliver to the indemnifying party a written
notice of the commencement thereof. The indemnifying party may participate in,
and, to the extent the indemnifying party so desires, jointly with any other
indemnifying party similarly given notice, assume control of the defense thereof
with counsel mutually and reasonably satisfactory to the indemnifying parties
and the Indemnified Person. If the indemnifying party assumes the defense by
notice given to the Indemnified Person, then the indemnifying party shall not be
responsible for any legal or other expenses subsequently incurred by the
Indemnified Person in connection with the defense thereof, except as expressly
provided herein, and the indemnifying party will diligently pursue such defense.
If, in the reasonable opinion of counsel retained by the indemnifying party, the
representation by such counsel of the Indemnified Person and the indemnifying
party would be inappropriate due to actual or potential conflicts of interest
between the Indemnified Person and any other party represented by such counsel
in such proceeding or the actual or potential defendants in, or targets of, any
such action including the Indemnified Person and such Indemnified Person
reasonably determines that there may be legal defenses available to such
Indemnified Person that are different from or in addition to those available to
the indemnifying party, then the Indemnified Person is entitled to assume such
defense and may retain its own counsel, with the reasonable fees and expenses to
be paid by the indemnifying party (subject to the restrictions on settlement
under Section 6.1 or 6.2, as applicable). However, the Company will pay for only
one separate legal counsel for the Investors collectively, and such legal
counsel will be selected in accordance with Section 2.6. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action does not relieve an indemnifying party of any
liability to an Indemnified Person under this Article VI, except to the extent
that the indemnifying party is prejudiced in its ability to defend such action.
The indemnification required by this Article VI will be made by periodic

                                       13
<PAGE>
payments of the amount thereof during the course of the investigation or
defense, as such expense, loss, damage or liability is incurred and is due and
payable.

                                  ARTICLE VII
                                  CONTRIBUTION

     To the extent that any indemnification provided for herein is prohibited or
limited by law, the indemnifying party will contribute the amount paid or
payable by the Indemnified Party as a result of such Claim in such proportion as
is appropriate to reflect not only the relative benefits received by the
Indemnified Party and the indemnifying party, but also the relative fault of the
Indemnified Party and the indemnifying party, as well as any other relevant
equitable considerations. However, (a) no contribution will be made under
circumstances where the maker would not have been liable for indemnification
under the fault standards set forth in Article VI, (b) no seller of Registrable
Securities guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) will be entitled to contribution from any person of
Registrable Securities who was not guilty of such fraudulent misrepresentation
and (c) no Investor will be liable under this Agreement (including this Article
VII) for the amount of any Claim that exceeds the net proceeds actually received
by such Investor as a result of the sale of such Investor's Registrable
Securities.

                                  ARTICLE VIII
                             EXCHANGE ACT REPORTING

     To make available to the Investors the benefits of Rule 144 or any similar
rule or regulation of the SEC that may at any time permit the Investors to sell
securities of the Company to the public without registration, the Company will,
until the end of the Registration Period:

     (a) Use its best efforts to file with the SEC in a timely manner, and make
and keep available, all reports and other documents required of the Company
under the Securities Act and the Exchange Act so long as the Company remains
subject to such requirements (it being understood that nothing herein limits the
Company's obligations under Section 4.3 of the Purchase Agreement) and the
filing and availability of such reports and other documents is required for the
applicable provisions of Rule 144; and

     (b) Furnish to each Investor, so long as such Investor holds Registrable
Securities, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting requirements of the Securities Act and the
Exchange Act, (ii) if not available on the SEC's EDGAR system, a copy of the
most recent annual or quarterly report of the Company and such other reports and
documents filed by the Company with the SEC and (iii) such other information as
may be reasonably requested to permit the Investors to sell such securities
pursuant to Rule 144 without registration.

                                   ARTICLE IX
                       ASSIGNMENT OF REGISTRATION RIGHTS

     The rights of the Investors hereunder, including the right to have the
Company register Registrable Securities pursuant to this Agreement, shall be
assignable (in whole or in part) by each Investor to any permitted transferee or
assignee of the Registrable Securities if (a) the Investor agrees in writing
with the transferee or assignee to assign such rights, and a copy of such
agreement is furnished to the Company within a reasonable time after such
assignment, (b) the Company is, within a reasonable time after such transfer or
assignment, furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being transferred or assigned, (c) such transfer or
assignment was not made under the Registration Statement or

                                       14
<PAGE>
Rule 144, (d) at or before the time the Company received the written notice
contemplated by clause (b) of this sentence, the transferee or assignee agrees
in writing with the Company to be bound by all of the provisions contained
herein and (e) such transfer is made in accordance with the applicable
requirements of the Purchase Agreement. Any transferee or assignee of an
Investor under Article IX shall be deemed an "Investor" for all purposes of this
Agreement and shall be entitled to all rights of, and subject to all obligations
(including indemnification obligations) of, an Investor hereunder.

                                   ARTICLE X
                        AMENDMENT OF REGISTRATION RIGHTS

     This Agreement may be amended and the obligations hereunder may be waived
(either generally or in a particular instance, and either retroactively or
prospectively) only with the written consent of the Company and of the Investors
who then hold at least a majority in interest of the Registrable Securities (but
not including any Investor who is not affected by such amendment or waiver). Any
amendment or waiver effected in accordance with this Article X is binding upon
each Investor and the Company. Notwithstanding the foregoing, no amendment or
waiver will retroactively affect any Investor without its consent, or will
prospectively adversely affect any Investor who no longer owns any Registrable
Securities without its consent. The Company will promptly notify any Investor
not consenting to the amendment of the substance of such amendment.

                                   ARTICLE XI
                                 MISCELLANEOUS

     11.1. Conflicting Instructions. A person or entity is deemed to be a holder
of Registrable Securities whenever such person or entity owns of record such
Registrable Securities. If the Company receives conflicting instructions,
notices or elections from two or more persons or entities with respect to the
same Registrable Securities, the Company will act upon the basis of
instructions, notice or election received from the registered owner of such
Registrable Securities.

     11.2. Notices. Except as set forth herein, any notices required or
permitted to be given under the terms of this Agreement will be given and deemed
received as set forth in the Purchase Agreement.

     11.3. Waiver. Failure of any party to exercise any right or remedy under
this Agreement or otherwise, or delay by a party in exercising such right or
remedy, does not operate as a waiver thereof.

     11.4. Governing Law; Waiver of Jury Trial. This Agreement, including the
validity hereof and the rights and obligations of the Company and of the
Investors and all amendments and supplements hereto and all waivers and consents
hereunder, shall be construed in accordance with and governed by the internal
laws of Wisconsin without giving effect to any choice of law or conflicts of law
provision or rule that would cause the application of the internal laws of any
other jurisdiction.

     EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE RIGHT TO TRIAL BY JURY IN ANY
LEGAL OR EQUITABLE ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY OR THE SUBJECT
MATTER OF ANY OF THE FOREGOING.

                                       15
<PAGE>
     11.5. Severability. If any provision of this Agreement is invalid or
unenforceable under any applicable statute or rule of law, then such provision
will be deemed modified in order to conform with such statute or rule of law.
Any provision hereof that may prove invalid or unenforceable under any law will
not affect the validity or enforceability of any other provision hereof.

     11.6. Entire Agreement. This Agreement and the Purchase Agreement
(including all schedules and exhibits thereto) constitute the entire agreement
among the parties hereto with respect to the subject matter hereof and thereof.
There are no restrictions, promises, warranties or undertakings, other than
those set forth or referred to herein or therein. This Agreement supersedes all
prior agreements and understandings among the parties hereto with respect to the
subject matter hereof.

     11.7. Successors and Assigns. Subject to the requirements of Article IX,
this Agreement inures to the benefit of and is binding upon the successors and
assigns of each of the parties hereto. Notwithstanding anything to the contrary
herein, including, without limitation, Article IX, the rights of an Investor
hereunder are assignable to and exercisable by a bona fide pledgee of the
Registrable Securities in connection with an Investor's margin or brokerage
accounts.

     11.8. Use of Pronouns. All pronouns refer to the masculine, feminine or
neuter, singular or plural, as the context may require.

     11.9. Headings. The headings of this Agreement are for convenience of
reference only, are not part of this Agreement and do not affect its
interpretation.

     11.10. Counterparts. This Agreement may be executed in two or more
counterparts, each of which is deemed an original but all of which constitute
one and the same agreement. This Agreement, once executed by a party, may be
delivered to the other party hereto by facsimile transmission, and facsimile
signatures are binding on the parties hereto.

     11.11. Further Assurances. Each party will do and perform, or cause to be
done and performed, all such further acts and things, and will execute and
deliver all other agreements, certificates, instruments and documents, as
another party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

     11.12. Consents. All consents and other determinations to be made by the
Investors pursuant to this Agreement will be made by the Initial Investors or
the Investors holding a majority in interest of the Registrable Securities.

     11.13. No Strict Construction. The language used in this Agreement is
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any party.

     11.14. Mutual Fund. Certain Investors are registered investment companies
entering into this Agreement solely on behalf of one or more of their mutual
fund series (each, a "Fund"). With respect to all obligations of a Fund arising
out of this Agreement, the Company will look for payment or satisfaction of any
claim solely to the assets and property of the applicable Fund.

                                     * * * *

                                       16
<PAGE>
     IN WITNESS WHEREOF, the undersigned Investors and the Company have caused
this Agreement to be duly executed as of the date first above written.

                                     COMPANY:

                                     MIDWEST EXPRESS HOLDINGS, INC.

                                     By: /s/ Robert S. Bahlman
                                         ---------------------------------------
                                         Name: Robert S. Bahlman
                                         Title:Senior Vice President and
                                               Chief Financial Officer

                  [SIGNATURES CONTINUE ON THE FOLLOWING PAGES]

<PAGE>
                      [INVESTORS' SIGNATURE PAGES OMITTED]

                                     [NAME OF INVESTOR]

                                     Sign Name:
                                                --------------------------------
                                     Print Name:
                                                --------------------------------
                                     Title:
                                                --------------------------------

<PAGE>
                                                                       EXHIBIT A

                              PLAN OF DISTRIBUTION

     The selling shareholders may resell or redistribute the securities listed
elsewhere in this prospectus from time to time on any stock exchange or
automated interdealer quotation system on which the securities are listed, in
the over-the-counter market, in privately negotiated transactions, or in any
other legal manner, at fixed prices that may be changed, at market prices
prevailing at the time of sale, at prices related to prevailing market prices or
at negotiated prices. Persons who are pledgees, donees, transferees, or other
successors in interest of any of the named selling shareholders (including but
not limited to persons who receive securities from a named selling shareholder
as a gift, partnership distribution or other non-sale-related transfer after the
date of this prospectus) may also use this prospectus and are included when we
refer to "selling shareholders" in this prospectus. Selling shareholders may
sell the securities by one or more of the following methods, without limitation:

     o    block trades (which may include cross trades) in which the broker or
          dealer so engaged will attempt to sell the securities as agent but may
          position and resell a portion of the block as principal to facilitate
          the transaction;

     o    purchases by a broker or dealer as principal and resale by the broker
          or dealer for its own account;

     o    an exchange distribution or secondary distribution in accordance with
          the rules of any stock exchange on which the securities are listed;

     o    ordinary brokerage transactions and transactions in which the broker
          solicits purchases;

     o    an offering at other than a fixed price on or through the facilities
          of any stock exchange on which the securities are listed or to or
          through a market maker other than on that stock exchange;

     o    privately negotiated transactions, directly or through agents;

     o    short sales;

     o    through the writing of options on the securities, whether or the
          options are listed on an options exchange;

     o    through the distribution of the securities by any selling shareholder
          to its partners, members or stockholders;

     o    one or more underwritten offerings;

     o    agreements between a broker or dealer and one or more of the selling
          shareholders to sell a specified number of the securities at a
          stipulated price per share; and

     o    any combination of any of these methods of sale or distribution, or
          any other method permitted by applicable law.

<PAGE>
     The selling shareholders may also transfer the securities by gift. We do
not know of any current arrangements by the selling shareholders for the sale or
distribution of any of the securities.

     The selling shareholders may engage brokers and dealers, and any brokers or
dealers may arrange for other brokers or dealers to participate in effecting
sales of the securities. These brokers, dealers or underwriters may act as
principals, or as an agent of a selling shareholder. Broker-dealers may agree
with a selling shareholder to sell a specified number of the securities at a
stipulated price per security. If the broker-dealer is unable to sell securities
acting as agent for a selling shareholder, it may purchase as principal any
unsold securities at the stipulated price. Broker-dealers who acquire securities
as principals may thereafter resell the securities from time to time in
transactions in any stock exchange or automated interdealer quotation system on
which the securities are then listed, at prices and on terms then prevailing at
the time of sale, at prices related to the then-current market price or in
negotiated transactions. Broker-dealers may use block transactions and sales to
and through broker-dealers, including transactions of the nature described
above. The selling shareholders may also sell the securities in accordance with
Rule 144 under the Securities Act rather than pursuant to this prospectus,
regardless of whether the securities are covered by this prospectus.

     From time to time, one or more of the selling shareholders may pledge,
hypothecate or grant a security interest in some or all of the securities owned
by them. The pledgees, secured parties or persons to whom the securities have
been hypothecated will, upon foreclosure in the event of default, be deemed to
be selling shareholders. The number of a selling shareholder's securities
offered under this prospectus will decrease as and when it takes such actions.
The plan of distribution for that selling shareholder's securities will
otherwise remain unchanged. In addition, a selling shareholder may, from time to
time, sell the securities short, and in those instances, this prospectus may be
delivered in connection with the short sales and the securities offered under
this prospectus may be used to cover short sales.

     The selling shareholders and any underwriters, brokers, dealers or agents
that participate in the distribution of the securities may be deemed to be
"underwriters" within the meaning of the Securities Act, and any discounts,
concessions, commissions or fees received by them and any profit on the resale
of the securities sold by them may be deemed to be underwriting discounts and
commissions.

     A selling shareholder may enter into hedging transactions with
broker-dealers and the broker-dealers may engage in short sales of the
securities in the course of hedging the positions they assume with that selling
shareholder, including, without limitation, in connection with distributions of
the securities by those broker-dealers. A selling shareholder may enter into
option or other transactions with broker-dealers that involve the delivery of
the securities offered under this prospectus to the broker-dealers, who may then
resell or otherwise transfer those securities. A selling shareholder may also
loan or pledge the securities offered under this prospectus to a broker-dealer
and the broker-dealer may sell the securities offered under this prospectus so
loaned or upon a default may sell or otherwise transfer the pledged securities
offered under this prospectus.

     The selling shareholders and other persons participating in the sale or
distribution of the securities will be subject to applicable provisions of the
Securities Exchange Act of 1934, as amended, and the related rules and
regulations adopted by the SEC, including Regulation M. This regulation may
limit the timing of purchases and sales of any of the securities by the selling
shareholders and any other person. The anti-manipulation rules under the
Exchange Act may apply to sales of securities in the market and to the
activities of the selling shareholders and their affiliates. Furthermore,
Regulation M may restrict the ability of any person engaged in the distribution
of the securities to engage in market-making activities with respect to the
particular securities being distributed for a period of up to five business days
before the distribution. These restrictions may affect the marketability of the
securities and the ability of any person or entity to engage in market-making
activities with respect to the securities.

<PAGE>
     We have agreed to indemnify the selling shareholders, any underwriter for
the selling shareholders, any directors or officers of the selling shareholders
and any person who controls (within the meaning of the federal securities laws )
the selling shareholders or acts as an investment advisor to the selling
shareholders against specified liabilities, including liabilities under the
federal securities laws. The selling shareholders have each agreed, severally
and not jointly, to indemnify us, each of our directors, each of our officers
who sign the registration statement, each person who controls (within the
meaning of the federal securities laws) us and the other selling shareholders,
including any director, officer or person who controls (within the meaning of
the federal securities laws) the other selling shareholders, against specified
liabilities arising from information provided by the selling shareholder for use
in this prospectus, including liabilities under the federal securities laws. The
selling shareholders may agree to indemnify any brokers, dealers or agents who
participate in transactions involving sales of the securities against specified
liabilities arising under the federal securities laws in connection with the
offering and sale of the securities.

     The securities offered under this prospectus were originally issued to the
selling shareholders pursuant to an exemption from the registration requirements
of the Securities Act. We agreed to register the securities under the Securities
Act and to keep the registration statement of which this prospectus is a part
effective until the earlier of (a) the date as of which the selling shareholders
may sell all of the shares of common stock subject to this registration
statement without restriction pursuant to Rule 144(k) (or successor thereto)
promulgated under the Securities Act or (b) the date on which the selling
shareholders shall have sold all shares of common stock subject to this
registration statement. We have agreed to pay all expenses in connection with
this offering, including fees and expenses of a single counsel for the selling
shareholders, but not including underwriting discounts, concessions, commissions
or fees of the selling shareholders.

     We will not receive any proceeds from sales of any securities by the
selling shareholders.

     We cannot assure you that the selling shareholders will sell all or any
portion of the securities offered under this prospectus.

     We will supply the selling shareholders and the any stock exchange upon
which the securities are listed with reasonable quantities of copies of this
prospectus. To the extent required by Rule 424 under the Securities Act in
connection with any resale or redistribution by a selling shareholder, we will
file a prospectus supplement setting forth

     o    the aggregate number of shares to be sold;

     o    the purchase price;

     o    the public offering price;

     o    if applicable, the names of any underwriter, agent or broker-dealer;
          and

     o    any applicable commissions, discounts, concessions, fees or other
          items constituting compensation to underwriters, agents or
          broker-dealers with respect to the particular transaction (which may
          exceed customary commissions or compensation).

     If a selling shareholder notifies us that a material arrangement has been
entered into with a broker-dealer for the sale of shares through a block trade,
special offering, exchange, distribution or secondary distribution or a purchase
by a broker or dealer, then we will file a prospectus supplement that

<PAGE>
includes any other facts that are material to the transaction. If applicable,
this may include a statement to the effect that the participating broker-dealers
did not conduct any investigation to verify the information set out or
incorporated by reference in this prospectus. We will also file a supplement to
this prospectus upon our being notified by a selling shareholder that a donee,
pledgee, transferee or other successor-in-interest intends to sell more than 500
shares or as otherwise required by law.

<PAGE>
                                                                       EXHIBIT B

                         FORM OF NOTICE OF EFFECTIVENESS
                            OF REGISTRATION STATEMENT

American Stock Transfer & Trust Company
59 Maiden Lane
Plaza Level
New York, NY 10038
Attn:    _____________________

     Re: Midwest Express Holdings, Inc.

Ladies and Gentlemen:

     We are counsel to Midwest Express Holdings, Inc., a Wisconsin corporation
(the "Company"), and have represented the Company in connection with the Company
negotiating and executing that certain Securities Purchase Agreement, dated as
of September 29, 2003, by and among the investors named on the signature pages
thereto (the "Investors") and the Company (the "Purchase Agreement"). Upon the
terms and subject to the conditions of the Purchase Agreement, the Company has
agreed to sell to the Investors 1,882,353 shares of the Company's common stock,
par value $.01 per share (and, together with any associated Rights (as defined
in the Purchase Agreement), the "Securities"). Pursuant to the Purchase
Agreement, the Company entered into a Registration Rights Agreement with the
Investors, dated as of September 29, 2003 (the "Registration Rights Agreement"),
pursuant to which the Company agreed, among other things, to register the
Securities under the Securities Act of 1933, as amended (the "Securities Act").
In connection with the Company's obligations under the Registration Rights
Agreement, on _______ ___, 2003, the Company filed the Registration Statement on
Form S-1 (File No. 333-_________) (the "Registration Statement") with the
Securities and Exchange Commission (the "SEC"). The Registration Statement
registers the Securities for resale under the Securities Act and names each of
the Investors as a selling shareholder thereunder.

     In connection with the Registration Statement, we advise you that a member
of the SEC's staff has advised us by telephone that the SEC has entered an order
declaring the Registration Statement effective under the Securities Act at
[ENTER TIME OF EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS], and we have no
knowledge, after telephonic inquiry of a member of the SEC's staff, that any
stop order suspending its effectiveness has been issued or that any proceedings
for that purpose are pending before, or threatened by, the SEC and the
Securities are available for resale under the Securities Act pursuant to the
Registration Statement.

                                     Very truly yours,

                                     [COMPANY'S COUNSEL]

                                     By:_____________________

     CC: [LIST NAMES OF INVESTORS]

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