Document:

EXHIBIT 4.6

         THE SECURITIES  REPRESENTED  HEREBY MAY NOT BE  TRANSFERRED  UNLESS (I)
SUCH  SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF
1933, AS AMENDED,  (II) SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE 144(K),  OR
(III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY  SATISFACTORY TO
IT THAT SUCH  TRANSFER  MAY  LAWFULLY  BE MADE  WITHOUT  REGISTRATION  UNDER THE
SECURITIES ACT OF 1933 OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS.

         SUBJECT TO THE  PROVISIONS OF SECTION 10 HEREOF,  THIS WARRANT SHALL BE
VOID AFTER 5:00 P.M. EASTERN TIME ON FEBRUARY 6, 2009 (the "EXPIRATION DATE").

NO.   PA02040__

                          APPLIED NEUROSOLUTIONS, INC.

                     WARRANT TO PURCHASE 3,200,000 SHARES OF
                    COMMON STOCK, PAR VALUE $0.0025 PER SHARE

         For VALUE RECEIVED, MOORS & CABOT, INC. ("Warrantholder"),  is entitled
to  purchase,   subject  to  the  provisions  of  this  Warrant,   from  Applied
NeuroSolutions,  Inc., a Delaware corporation ("Company"), at any time not later
than 5:00 P.M.,  Eastern time, on the Expiration Date (as defined above),  at an
exercise  price per share  equal to $0.30 (the  exercise  price in effect  being
herein  called  the  "Warrant  Price"),   THREE  MILLION  TWO  HUNDRED  THOUSAND
(3,200,000)  shares ("Warrant  Shares") of the Company's Common Stock, par value
$0.0025 per share ("Common  Stock").  The number of Warrant  Shares  purchasable
upon  exercise  of this  Warrant  and the  Warrant  Price  shall be  subject  to
adjustment from time to time as described  herein.  This Warrant is being issued
to the  Warrantholder  pursuant to Section  4(g) of that  certain  Sales  Agency
Agreement,  dated  January  28,  2003,  by  and  between  the  Company  and  the
Warrantholder (the "Agency Agreement").

         Section 1.  REGISTRATION.  The  Company  shall  maintain  books for the
transfer  and  registration  of the Warrant.  Upon the initial  issuance of this
Warrant,  the Company  shall issue and  register  the Warrant in the name of the
Warrantholder.

         Section  2.  TRANSFERS.   As  provided  herein,  this  Warrant  may  be
transferred only pursuant to a registration statement filed under the Securities
Act of 1933,  as amended  (the  "Securities  Act"),  or an  exemption  from such
registration.  Subject to such  restrictions,  the Company  shall  transfer this
Warrant  from time to time upon the books to be  maintained  by the  Company for
that  purpose,   upon  surrender  thereof  for  transfer  properly  endorsed  or
accompanied by appropriate instructions for transfer and such other documents as
may be  reasonably  required  by the  Company,  including,  if  required  by the
Company,  an opinion of its counsel to the effect  that such  transfer is exempt
from the registration requirements of the Securities Act, to establish

<PAGE>

that such transfer is being made in accordance with the terms hereof,  and a new
Warrant shall be issued to the transferee and the  surrendered  Warrant shall be
canceled by the Company.

         Section 3. EXERCISE OF WARRANT.  Subject to the provisions  hereof, the
Warrantholder  may not  exercise  this  Warrant  prior to  February 6, 2005 (the
"Lock-Up Period"). After the expiration of the Lock-Up Period, the Warrantholder
may  exercise  this  Warrant  in  whole  or in part  at any  time  prior  to its
expiration  upon  surrender of the Warrant,  together  with delivery of the duly
executed  Warrant  exercise  form attached  hereto as Appendix A (the  "Exercise
Agreement")  and payment by cash,  certified check or wire transfer of funds for
the  aggregate  Warrant  Price for that  number of  Warrant  Shares  then  being
purchased,  to the Company  during normal  business hours on any business day at
the Company's principal executive offices (or such other office or agency of the
Company as it may designate by notice to the Warrantholder).  The Warrant Shares
so  purchased  shall  be  deemed  to be  issued  to  the  Warrantholder  or  the
Warrantholder's designee, as the record owner of such shares, as of the close of
business  on the date on which  this  Warrant  shall have been  surrendered  (or
evidence  of loss,  theft or  destruction  thereof  and  security  or  indemnity
satisfactory  to the  Company),  the Warrant  Price shall have been paid and the
completed  Exercise  Agreement shall have been delivered.  Certificates  for the
Warrant  Shares  so  purchased,  representing  the  aggregate  number  of shares
specified in the  Exercise  Agreement,  shall be delivered to the  Warrantholder
within a reasonable  time,  not exceeding  three (3) business  days,  after this
Warrant shall have been so exercised.  The certificates so delivered shall be in
such  denominations  as may be  requested  by the  Warrantholder  and  shall  be
registered  in the  name of the  Warrantholder  or such  other  name as shall be
designated by the Warrantholder.  If this Warrant shall have been exercised only
in part,  then,  unless this  Warrant has  expired,  the Company  shall,  at its
expense,  at  the  time  of  delivery  of  such  certificates,  deliver  to  the
Warrantholder  a new Warrant  representing  the number of shares with respect to
which this Warrant shall not then have been exercised. As used herein, "business
day" means a day,  other than a Saturday  or Sunday,  on which banks in New York
City are open for the general  transaction  of business.  Each  exercise  hereof
shall   constitute   the   re-affirmation   by  the   Warrantholder   that   the
representations and warranties  contained in Section 5 of the Purchase Agreement
(as defined below) are true and correct in all material respects with respect to
the Warrantholder as of the time of such exercise.

         Section  4.  COMPLIANCE  WITH THE  SECURITIES  ACT OF 1933.  Except  as
provided  in the  Purchase  Agreement  (as  defined  below)  and  in the  Agency
Agreement,  the Company may cause the legend set forth on the first page of this
Warrant to be set forth on each Warrant or similar legend on any security issued
or issuable upon exercise of this Warrant,  unless counsel for the Company is of
the opinion as to any such security that such legend is unnecessary.

         Section 5. PAYMENT OF TAXES. The Company will pay any documentary stamp
taxes  attributable to the initial  issuance of Warrant Shares issuable upon the
exercise  of the  Warrant;  provided,  however,  that the  Company  shall not be
required to pay any tax or taxes which may be payable in respect of any transfer
involved in the issuance or delivery of any certificates for Warrant Shares in a
name other than that of the  Warrantholder  in respect of which such  shares are
issued,  and in such case, the Company shall not be required to issue or deliver
any  certificate  for Warrant Shares or any Warrant until the person  requesting
the same has paid to the  Company the amount of such tax or has  established  to
the Company's reasonable satisfaction that such tax

                                      -2-
<PAGE>

has been paid. The Warrantholder shall be responsible for income taxes due under
federal, state or other law, if any such tax is due.

         Section 6. MUTILATED OR MISSING WARRANTS. In case this Warrant shall be
mutilated,  lost, stolen, or destroyed,  the Company shall issue in exchange and
substitution of and upon  cancellation of the mutilated  Warrant,  or in lieu of
and  substitution  for the Warrant lost,  stolen or destroyed,  a new Warrant of
like tenor and for the  purchase  of a like number of Warrant  Shares,  but only
upon receipt of evidence  reasonably  satisfactory  to the Company of such loss,
theft or  destruction  of the  Warrant,  and with  respect to a lost,  stolen or
destroyed  Warrant,  reasonable  indemnity  or bond  with  respect  thereto,  if
requested by the Company.

         Section 7. RESERVATION OF COMMON STOCK.  The Company hereby  represents
and  warrants  that  there  have been  reserved,  and the  Company  shall at all
applicable  times keep reserved until issued (if necessary) as  contemplated  by
this  Section 7, out of the  authorized  and  unissued  shares of Common  Stock,
sufficient  shares  to  provide  for the  exercise  of the  rights  of  purchase
represented  by this Warrant.  The Company agrees that all Warrant Shares issued
upon due  exercise  of the  Warrant  shall  be, at the time of  delivery  of the
certificates  for such Warrant Shares,  duly authorized,  validly issued,  fully
paid and non-assessable shares of Common Stock of the Company.

         Section 8. ADJUSTMENTS.  Subject and pursuant to the provisions of this
Section  8, the  Warrant  Price and  number of  Warrant  Shares  subject to this
Warrant  shall  be  subject  to  adjustment  from  time  to  time  as set  forth
hereinafter.

                  (a) If the  Company  shall,  at any time or from  time to time
while this Warrant is outstanding,  pay a dividend or make a distribution on its
Common Stock in shares of Common  Stock,  subdivide  its  outstanding  shares of
Common Stock into a greater number of shares or combine its  outstanding  shares
of Common Stock into a smaller number of shares or issue by  reclassification of
its  outstanding  shares  of  Common  Stock  any  shares  of its  capital  stock
(including  any such  reclassification  in connection  with a  consolidation  or
merger in which the Company is the continuing  corporation),  then the number of
Warrant Shares purchasable upon exercise of the Warrant and the Warrant Price in
effect  immediately  prior to the date  upon  which  such  change  shall  become
effective, shall be adjusted by the Company so that the Warrantholder thereafter
exercising  the  Warrant  shall be  entitled  to receive the number of shares of
Common Stock or other capital stock which the Warrantholder  would have received
if the Warrant had been exercised  immediately  prior to such event upon payment
of a Warrant  Price that has been  adjusted to reflect a fair  allocation of the
economics of such event to the  Warrantholder.  Such  adjustments  shall be made
successively whenever any event listed above shall occur.

                  (b) If any  capital  reorganization,  reclassification  of the
capital  stock of the  Company,  consolidation  or  merger of the  Company  with
another corporation in which the Company is not the survivor,  or sale, transfer
or other  disposition  of all or  substantially  all of the Company's  assets to
another   corporation   shall  be  effected,   then,  as  a  condition  of  such
reorganization, reclassification, consolidation, merger, sale, transfer or other
disposition,   lawful  and  adequate   provision  shall  be  made  whereby  each
Warrantholder  shall  thereafter have the right to purchase and receive upon the
basis and upon the terms and conditions herein specified and in

                                      -3-
<PAGE>

lieu of the Warrant Shares immediately theretofore issuable upon exercise of the
Warrant, such shares of stock,  securities or assets as would have been issuable
or payable with  respect to or in exchange for a number of Warrant  Shares equal
to the number of Warrant Shares immediately  theretofore  issuable upon exercise
of  the  Warrant,  had  such  reorganization,  reclassification,  consolidation,
merger,  sale,  transfer or other  disposition not taken place,  and in any such
case  appropriate  provision  shall  be made  with  respect  to the  rights  and
interests  of  each   Warrantholder  to  the  end  that  the  provisions  hereof
(including,  without limitation,  provision for adjustment of the Warrant Price)
shall  thereafter be applicable,  as nearly  equivalent as may be practicable in
relation to any shares of stock,  securities  or assets  thereafter  deliverable
upon the exercise hereof.  The Company shall not effect any such  consolidation,
merger,  sale,  transfer or other disposition  unless prior to or simultaneously
with the  consummation  thereof  the  successor  corporation  (if other than the
Company)  resulting  from  such  consolidation  or  merger,  or the  corporation
purchasing or otherwise  acquiring such assets or other appropriate  corporation
or entity shall assume the  obligation to deliver to the  Warrantholder,  at the
last address of the  Warrantholder  appearing on the books of the Company,  such
shares of stock,  securities  or assets  as, in  accordance  with the  foregoing
provisions,  the  Warrantholder  may be  entitled  to  purchase,  and the  other
obligations  under this  Warrant.  The  provisions  of this  paragraph (b) shall
similarly    apply    to    successive    reorganizations,    reclassifications,
consolidations, mergers, sales, transfers or other dispositions.

                  (c) In case  the  Company  shall  fix a  payment  date for the
making of a  distribution  to all holders of Common  Stock  (including  any such
distribution  made in  connection  with a  consolidation  or merger in which the
Company is the continuing  corporation)  of evidences of  indebtedness or assets
(other than cash  dividends or cash  distributions  payable out of  consolidated
earnings or earned surplus or dividends or distributions  referred to in Section
8(a)),  or  subscription  rights or warrants,  the Warrant Price to be in effect
after such payment date shall be determined by multiplying  the Warrant Price in
effect  immediately  prior to such payment date by a fraction,  the numerator of
which shall be the total number of shares of Common Stock outstanding multiplied
by the Market  Price (as defined  below) per share of Common  Stock  immediately
prior to such payment  date,  less the fair market value (as  determined  by the
Company's  Board of  Directors  in good  faith) of said assets or  evidences  of
indebtedness so distributed, or of such subscription rights or warrants, and the
denominator  of which  shall be the total  number  of  shares  of  Common  Stock
outstanding   multiplied  by  such  Market  Price  per  share  of  Common  Stock
immediately  prior to such payment date.  "Market Price" as of a particular date
(the "Valuation Date") shall mean the following: (a) if the Common Stock is then
listed on a national  stock  exchange,  the  closing  sale price of one share of
Common  Stock on such  exchange on the last  trading day prior to the  Valuation
Date;  (b) if the Common Stock is then quoted on The Nasdaq Stock  Market,  Inc.
("Nasdaq"), the closing sale price of one share of Common Stock on Nasdaq on the
last trading day prior to the  Valuation  Date or, if no such closing sale price
is  available,  the  average of the high bid and the low asked  price  quoted on
Nasdaq on the last trading day prior to the Valuation Date; or (c) if the Common
Stock is not then listed on a national stock  exchange or quoted on Nasdaq,  the
fair market value of one share of Common Stock as of the Valuation  Date,  shall
be  determined  in good faith by the Board of  Directors  of the Company and the
Warrantholder.  If the Common Stock is not then listed on a national  securities
exchange  or quoted on  Nasdaq,  the Board of  Directors  of the  Company  shall
respond promptly,  in writing,  to an inquiry by the Warrantholder  prior to the
exercise hereunder as to the fair

                                      -4-
<PAGE>

market value of a share of Common Stock as  determined by the Board of Directors
of the Company.  In the event that the Board of Directors of the Company and the
Warrantholder  are  unable to agree  upon the fair  market  value in  respect of
subpart (c) hereof,  the Company and the  Warrantholder  shall jointly select an
appraiser,  who is experienced  in such matters.  The decision of such appraiser
shall be final and  conclusive,  and the cost of such  appraiser  shall be borne
equally by the  Company and the  Warrantholder.  Such  adjustment  shall be made
successively whenever such a payment date is fixed.

                  (d) An adjustment to the Warrant Price shall become  effective
immediately  after the payment date in the case of each dividend or distribution
and  immediately  after the effective date of each other event which requires an
adjustment.

                  (e) In the  event  that,  as a result  of an  adjustment  made
pursuant to this Section 8, the  Warrantholder  shall become entitled to receive
any shares of capital  stock of the Company  other than shares of Common  Stock,
the number of such other  shares so  receivable  upon  exercise of this  Warrant
shall be subject  thereafter to adjustment  from time to time in a manner and on
terms as nearly  equivalent as practicable to the provisions with respect to the
Warrant Shares contained in this Warrant.

         Section 9.  FRACTIONAL  INTEREST.  The Company shall not be required to
issue  fractions  of Warrant  Shares upon the exercise of this  Warrant.  If any
fractional  share of Common Stock would,  except for the provisions of the first
sentence of this Section 9, be deliverable upon such exercise,  the Company,  in
lieu  of  delivering  such  fractional  share,   shall  pay  to  the  exercising
Warrantholder  an amount in cash  equal to the Market  Price of such  fractional
share of Common Stock on the date of exercise.

         Section 10. EXTENSION OF EXPIRATION DATE. If the Company fails to cause
any Registration  Statement  covering  Registrable  Securities (unless otherwise
defined  herein,  capitalized  terms are as defined in the  Registration  Rights
Agreement relating to the Warrant Shares (the "Registration  Rights Agreement"))
to be declared effective prior to the applicable dates set forth therein,  or if
any of the events  specified  in Section  2(c)(ii)  of the  Registration  Rights
Agreement occurs, and the Blackout Period (whether alone, or in combination with
any  other  Blackout  Period)  continues  for more  than 60 days in any 12 month
period,  or for more than a total of 90 days,  then the Expiration  Date of this
Warrant  shall be  extended  one day for each day  beyond  the  60-day or 90-day
limits, as the case may be, that the Blackout Period continues.

         Section 11.  BENEFITS.  Nothing in this  Warrant  shall be construed to
give  any  person,   firm  or  corporation  (other  than  the  Company  and  the
Warrantholder)  any legal or equitable  right,  remedy or claim, it being agreed
that this Warrant shall be for the sole and exclusive benefit of the Company and
the Warrantholder.

         Section 12. NOTICES TO  WARRANTHOLDER.  Upon the happening of any event
requiring an adjustment of the Warrant  Price,  the Company shall  promptly give
written  notice  thereof to the  Warrantholder  at the address  appearing in the
records of the  Company,  stating the  adjusted  Warrant  Price and the adjusted
number of  Warrant  Shares  resulting  from  such  event  and  setting  forth in
reasonable  detail  the  method of  calculation  and the facts  upon  which such
calculation is

                                      -5-
<PAGE>

based.  Failure to give such notice to the  Warrantholder  or any defect therein
shall not affect the legality or validity of the subject adjustment.

         Section 13.  IDENTITY OF TRANSFER  AGENT.  The  Transfer  Agent for the
Common Stock is American Stock Transfer and Trust Company.  Upon the appointment
of any  subsequent  transfer  agent for the Common  Stock or other shares of the
Company's  capital  stock  issuable  upon the exercise of the rights of purchase
represented  by the  Warrant,  the  Company  will  mail to the  Warrantholder  a
statement setting forth the name and address of such transfer agent.

         Section 14. NOTICES.  Unless otherwise provided, any notice required or
permitted  under  this  Warrant  shall be given in  writing  and shall be deemed
effectively  given as hereinafter  described (i) if given by personal  delivery,
then such  notice  shall be deemed  given upon such  delivery,  (ii) if given by
telex or  facsimile,  then such  notice  shall be deemed  given upon  receipt of
confirmation of complete  transmittal,  (iii) if given by mail, then such notice
shall be deemed  given  upon the  earlier of (A)  receipt of such  notice by the
recipient  or (B) three days after such notice is deposited in first class mail,
postage prepaid,  and (iv) if given by an internationally  recognized  overnight
air  courier,  then such notice  shall be deemed  given one  business  day after
delivery to such carrier.  All notices shall be addressed as follows:  if to the
Warrantholder,  at its address as set forth in the  Company's  books and records
and, if to the Company,  at the address as follows,  or at such other address as
the  Warrantholder  or the Company may  designate by ten days'  advance  written
notice to the other:

                   If to the Company:

                            Applied NeuroSolutions, Inc.
                            50 Lakeview Parkway
                            Vernon Hills, Illinois 60061
                            Attention:  Bruce N. Barron
                            Fax:  (847) 573-8030

                   With a copy to:

                            Ehrenreich Eilenberg & Krause LLP
                            11 East 44th Street, 17th Floor, New York, NY 10017
                            Attention: Adam D. Eilenberg, Esq.
                            Fax:  (212) 986-2399

         Section 15. REGISTRATION RIGHTS. The initial  Warrantholder is entitled
to the  benefit of certain  registration  rights  with  respect to the shares of
Common  Stock  issuable  upon the  exercise  of this  Warrant as provided in the
Registration Rights Agreement and Section 4(h) of the Agency Agreement,  and any
subsequent Warrantholder may be entitled to such rights.

         Section 16.  SUCCESSORS.  All the covenants and provisions hereof by or
for the benefit of the Warrantholder  shall bind and inure to the benefit of its
respective successors and assigns hereunder.

                                      -6-
<PAGE>

         Section 17.  GOVERNING  LAW;  CONSENT TO  JURISDICTION;  WAIVER OF JURY
TRIAL.  This Warrant shall be governed by, and construed in accordance with, the
internal laws of the State of New York,  without  reference to the choice of law
provisions   thereof.   The  Company  and,  by  accepting   this  Warrant,   the
Warrantholder,  each  irrevocably  submits to the exclusive  jurisdiction of the
courts of the State of New York located in New York County and the United States
District  Court for the  Southern  District  of New York for the  purpose of any
suit, action,  proceeding or judgment relating to or arising out of this Warrant
and the transactions  contemplated hereby. Service of process in connection with
any such suit,  action or proceeding may be served on each party hereto anywhere
in the world by the same  methods  as are  specified  for the  giving of notices
under  this  Warrant.   The  Company  and,  by  accepting   this  Warrant,   the
Warrantholder,  each irrevocably  consents to the jurisdiction of any such court
in any such suit, action or proceeding and to the laying of venue in such court.
The Company and, by accepting this Warrant, the Warrantholder,  each irrevocably
waives  any  objection  to the  laying  of  venue of any such  suit,  action  or
proceeding brought in such courts and irrevocably waives any claim that any such
suit,  action or  proceeding  brought in any such  court has been  brought in an
inconvenient  forum.  EACH OF THE COMPANY  AND, BY ITS  ACCEPTANCE  HEREOF,  THE
WARRANTHOLDER  HEREBY  WAIVES  ANY  RIGHT  TO  REQUEST  A  TRIAL  BY JURY IN ANY
LITIGATION  WITH  RESPECT TO THIS WARRANT AND  REPRESENTS  THAT COUNSEL HAS BEEN
CONSULTED SPECIFICALLY AS TO THIS WAIVER.

         Section  18.  CALL  PROVISION.   Notwithstanding  any  other  provision
contained  herein to the contrary,  in the event that the closing bid price of a
share of Common  Stock as  reported  on the OTC  Bulletin  Board (or such  other
exchange or stock market on which the Common Stock may then be listed or quoted)
equals or exceeds  $1.00  (appropriately  adjusted for any stock split,  reverse
stock split,  stock  dividend or other  reclassification  or  combination of the
Common  Stock  occurring  after the date  hereof)  for twenty  (20)  consecutive
trading days  commencing  after the  Registration  Statement  (as defined in the
Registration  Rights Agreement) has been declared effective,  the Company,  upon
thirty  (30) days  prior  written  notice  (the  "Notice  Period")  given to the
Warrantholder  within one business  day  immediately  following  the end of such
twenty (20) trading day period, may call this Warrant, in whole but not in part,
at a redemption  price equal to $0.05 per share of Common Stock then purchasable
pursuant to this Warrant; provided that (i) the Company simultaneously calls all
Company Warrants (as defined below) on the same terms, (ii) all of the shares of
Common  Stock  issuable  hereunder  either  (A) are  registered  pursuant  to an
effective   Registration  Statement  (as  defined  in  the  Registration  Rights
Agreement)  which  has not been  suspended  and for  which  no stop  order is in
effect,  and pursuant to which the  Warrantholder is able to sell such shares of
Common Stock at all times during the Notice  Period or (B) no longer  constitute
Registrable  Securities (as defined in the Registration  Rights Agreement),  and
(iii) the Lock Up Period has  expired.  Notwithstanding  any such  notice by the
Company,  the Warrantholder  shall have the right to exercise this Warrant prior
to the end of the Notice Period.

         Section  19. NO RIGHTS AS  STOCKHOLDER.  Prior to the  exercise of this
Warrant,  the  Warrantholder  shall  not  have  or  exercise  any  rights  as  a
stockholder of the Company by virtue of its ownership of this Warrant.

                                      -7-
<PAGE>

         Section  20.  AMENDMENT;  WAIVER.  This  Warrant  is of like tenor as a
series of Warrants issued by the Company pursuant to the Purchase  Agreement and
initially  covering an  aggregate  of up to  35,200,000  shares of Common  Stock
(collectively,  the "Company Warrants"). Any term of this Warrant may be amended
or waived  (including  the adjustment  provisions  included in Section 8 of this
Warrant)  upon the  written  consent of the  Company  and the holders of Company
Warrants  representing at least 50% of the number of shares of Common Stock then
subject to all outstanding Company Warrants (the "Majority Holders");  provided,
that (x) any such  amendment or waiver must apply to all Company  Warrants;  and
(y) the number of Warrant Shares subject to this Warrant,  the Warrant Price and
the Expiration  Date may not be amended,  and the right to exercise this Warrant
may not be altered or waived, without the written consent of the Warrantholder.

         Section 21. SECTION HEADINGS.  The section headings in this Warrant are
for the  convenience of the Company and the  Warrantholder  and in no way alter,
modify, amend, limit or restrict the provisions hereof.

                                      -8-
<PAGE>

         IN WITNESS  WHEREOF,  the Company  has caused  this  Warrant to be duly
executed, as of the 6th day of February, 2004.

                                                 APPLIED NEUROSOLUTIONS, INC.

                                                 By:
                                                     ------------------------
                                                 Name: Bruce N. Barron
                                                 Title: Chairman and CEO

                                      -9-
<PAGE>

                                   APPENDIX A
                          APPLIED NEUROSOLUTIONS, INC.
                              WARRANT EXERCISE FORM

To Applied NeuroSolutions, Inc.:

         The  undersigned  hereby  irrevocably  elects to exercise  the right of
purchase  represented  by the within  Warrant  ("Warrant")  for, and to purchase
thereunder  by the payment of the Warrant  Price and  surrender  of the Warrant,
_______________  shares of Common Stock ("Warrant Shares") provided for therein,
and requests that certificates for the Warrant Shares be issued as follows:

                           -------------------------------------
                           Name
                           -------------------------------------
                           Address
                           -------------------------------------

                           -------------------------------------
                           Federal Tax ID or Social Security No.

and  delivered  by  (certified  mail to the above  address,  or  (electronically
(provide DWAC Instructions: _____________________________), or (other (specify):
___________________________________). and, if the number of Warrant Shares shall
not be all the Warrant Shares  purchasable upon exercise of the Warrant,  that a
new Warrant for the balance of the Warrant Shares  purchasable  upon exercise of
this Warrant be registered in the name of the undersigned  Warrantholder  or the
undersigned's  Assignee as below  indicated and delivered to the address  stated
below.

Dated: ___________________, ____

Note: The signature must correspond        Signature:
with the name of the Warrantholder                    -------------------------
as written on the first page of the
Warrant in every particular,               ------------------------------------
without alteration or enlargement          Name (please print)
or any change whatever, unless the
Warrant has been assigned.                 ------------------------------------

                                           ------------------------------------
                                           Address

                                           ------------------------------------
                                           Federal Identification or
                                           Social Security No.

                                           Assignee:

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

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

                                           ------------------------------------Exhibit 10.1(b)

EXHIBIT 10.1(b)

SECOND AMENDMENT TO

AMENDED AND RESTATED

CAPACITY PURCHASE AGREEMENT

among

Continental Airlines, Inc.,

ExpressJet Holdings, Inc.,

XJT Holdings, Inc.,

and

ExpressJet Airlines, Inc.

Dated as of December 9, 2003

			
TABLE OF CONTENTS

		
					
Page

	
 

				

	
Parties...................................................................................................................

		
1

	
Recitals..................................................................................................................

		
1

	
 

				
					
			
ARTICLE I.

		
			
DEFINITIONS:  INTERPRETATION

		
					
	
Section 1.1.

		
Definitions......................................................................................

		
1

	
Section 1.2.

		
Interpretation.................................................................................

	
 

	
1

	
 

				
			
ARTICLE II.

		
			
AMENDMENTS TO CAPACITY PURCHASE AGREEMENT

		
			
 

		
	
Section 2.1.

		
Amendments to Section 3.02.........................................................

		
2

	
Section 2.2.

		
Amendments to Section 3.06.........................................................

		
2

	
Section 2.3.

		
Amendment to Schedule 3.............................................................

		
4

	
Section 2.4.

		
Amendment to Exhibit A................................................................

		
14

	
 

				
			
ARTICLE III.

		
			
REPRESENTATIONS AND WARRANTIES

		
			
 

		
	
Section 3.1.

		
Representations and Warranties of Holdings, XJT and ExpressJet...

		
18

	
Section 3.2.

		
Representations and Warranties of Continental...............................

		
19

	
 

				
			
ARTICLE IV.

		
			
MISCELLANEOUS

		
	
 

				
	
Section 4.1.

		
Effect of Agreement.......................................................................

		
20

	
Section 4.2.

		
Binding Effect:  Assignment............................................................

		
20

	
Section 4.3.

		
Amendment and Modification.........................................................

		
20

	
Section 4.4.

		
Counterparts..................................................................................

		
20

	
Section 4.5.

		
Severability....................................................................................

		
20

	
Section 4.6.

		
Entire Agreement...........................................................................

		
20

	
Section 4.7.

		
Governing Law..............................................................................

		
20

			
 

		

SECOND AMENDMENT TO

AMENDED AND RESTATED

CAPACITY PURCHASE AGREEMENT

            This SECOND AMENDMENT TO AMENDED AND RESTATED CAPACITY
PURCHASE AGREEMENT (this "Agreement"), dated as of December 9, 2003, is among Continental Airlines, Inc., a Delaware
corporation ("Continental"), ExpressJet Holdings, Inc., a Delaware corporation ("Holdings"), XJT Holdings, Inc., a
Delaware corporation and a wholly-owned subsidiary of Holdings ("XJT"), and ExpressJet Airlines, Inc., a Delaware
corporation and a subsidiary of XJT ("ExpressJet").

RECITALS:

            WHEREAS, Continental, Holdings, XJT, and ExpressJet are
parties to that certain Amended and Restated Capacity Purchase Agreement, dated as of April 17, 2002, as amended by that certain
First Amendment to Amended and Restated Capacity Purchase Agreement, dated as of March 27, 2003 (the "Capacity Purchase
Agreement"); 

            WHEREAS, Continental, Holdings, XJT, and ExpressJet
desire to amend certain provisions of the Capacity Purchase Agreement as more fully set forth herein; and

            WHEREAS, Section 11.04 of the Capacity Purchase
Agreement permits such agreement to be amended in a written agreement signed by Continental, Holdings, XJT, and ExpressJet;

            NOW, THEREFORE, in consideration of the foregoing
premises and the mutual covenants and obligations hereinafter contained, the parties agree to amend the Capacity Purchase Agreement
as follows:

ARTICLE I.

DEFINITIONS; INTERPRETATION

            Section 1.1.    
Definitions

  Capitalized terms used in this Agreement that are not otherwise defined shall have the meanings set forth in the Capacity
Purchase Agreement, as amended hereby.

            Section 1.2.    
Interpretation

  Section 11.06 of the Capacity Purchase Agreement is hereby incorporated by reference herein in its entirety and shall
govern the interpretation of this Agreement.

ARTICLE II.

AMENDMENTS TO CAPACITY PURCHASE AGREEMENT

            The Capacity Purchase Agreement is hereby amended as
follows:

            Section
2.1.     Amendments to Section 3.02

  Section 3.02 of the Capacity Purchase Agreement is hereby amended and restated in its entirety to read as follows:

            "Section 3.02 Periodic Adjustment of Base and Incentive
Compensation.

            The initial rates under this Agreement (including the initial
Block Hour Rates) set forth in Paragraphs A(1) and A(2)(c) of Schedule 3 hereto shall remain in effect through
December 31, 2004, with certain limited adjustments as are provided in Schedule 3.  The Block Hour Rates and the fee
described in Paragraph A(2)(c) of Schedule 3 shall be subject to further adjustment on January 1, 2005 and each
January 1 thereafter during the Term.  Continental and Contractor hereby agree to meet promptly after July 1, 2004, September
1, 2005 and each September 1 thereafter during the Term in order to review and revise the Block Hour Rates and the fee described in
Paragraph A(2)(c) of Schedule 3, as appropriate, for the subsequent year based on the methodology (including the Cost
Factor) for setting the initial Block Hour Rates and such fee as set forth in Schedule 3.  Should the parties be unable
to agree on such revised Block Hour Rates and the fee described in Paragraph A(2)(c) of Schedule 3 by October 1, 2004
for the year beginning January 1, 2005 or by November 1 in any subsequent year for the year beginning on the subsequent January 1,
then the parties shall submit the disagreement to arbitration pursuant to Section 11.08."

            Section 2.2.     Amendments to
Section 3.06

  Section 3.06 of the Capacity Purchase Agreement is hereby amended and restated in its entirety to read as follows:

"Section 3.06.   Billing and Payment; Reconciliation.

            (a)        Billing and
Payment.  On the next Business Day after Contractor receives the Final Monthly Schedule from Continental pursuant to
Section 2.01(b), Contractor shall present a reasonably detailed written invoice for amounts due under this Agreement in
respect of the Base Compensation and per passenger fees (based on the Forecasted Passengers) for the Scheduled Flights during the
month to which such Final Monthly Schedule pertains.  Continental shall pay Contractor the amount due under such invoice (the
"Invoiced Amount"), subject to Continental's right to dispute any calculations set forth on such invoice that do not comply
with the terms of this Agreement, net of amounts owed by Contractor to Continental under the Administrative Support and Information
Services Provisioning Agreement, the Master Facility and Ground Handling

Agreement, the Fuel Purchasing Agreement and/or any Covered Aircraft Sublease or Uncovered Aircraft Sublease, any amounts to be
prepaid to Continental pursuant to Section 3.06(c) during the month covered by the Final Monthly Schedule, any Insurance costs paid
by Continental on Contractor's behalf covering the month covered by the Final Monthly Schedule pursuant to Schedule 3 and/or any
other amounts as mutually agreed to by both Contractor and Continental, as follows:

            (i)        
One-quarter of the Invoiced Amount shall be payable by Continental to Contractor, by electronic transfer of funds to a bank account
designated by Contractor, available on or before the first day of the month (or if such day is not a Business Day, the next
Business Day) to which such invoice relates;

            (ii)        One-quarter of
the Invoiced Amount shall be payable by Continental to Contractor, by electronic transfer of funds to a bank account designated by
Contractor, available on or before the 8th day of the month (or if such day is not a Business Day, the next Business Day) to which
the invoice relates;

            (iii)       One-quarter of the
Invoiced Amount shall be payable by Continental to Contractor, by electronic transfer of funds to a bank account designated by
Contractor, available on or before the 15th day of the month (or if such day is not a Business Day, the next Business Day) to which
the invoice relates; and

            (iv)       One-quarter of the
Invoiced Amount shall be payable by Continental to Contractor, by electronic transfer of funds to a bank account designated by
Contractor, available on or before the 22nd day of the month (or if such day is not a Business Day, the next Business Day) to which
the invoice relates.

            (b)       
Reconciliation.  Not later than 14 days following the end of each month, Contractor and Continental shall reconcile
actual amounts due in respect of such month with the estimated amounts included in the Invoiced Amount for such items for such
month in accordance with the terms and conditions set forth in Schedule 3.  On or before the 15th day following the end
of such month (or if such day is not a Business Day, the next Business Day), such reconciled amounts for such month to the extent
applicable:  (a) shall be paid by Continental to Contractor, together with any payment to be made by Continental pursuant to
Section 3.06(a)(iii) above, or (b) shall be paid by Contractor to Continental or set off by Continental against any
other amounts owing to Contractor.  Further reconciliations shall be made on or prior to the 22nd day following the end of
such month (or if such day is not a Business Day, the next Business Day) to the extent necessary as a result of Continental's
review of financial information provided by Contractor in respect of such month.  Such further reconciled amounts for such
month to the extent applicable (x) shall be paid by Continental to Contractor, together with any other payment to be made by
Continental pursuant to Section 3.06(a)(iv) above, or (y) shall be paid by Contractor to Continental or set off by
Continental against any other amounts owing to Contractor.  If, subsequent to any reconciliation payments or set-off, as the
case may be, Contractor's financial statements,

maintained as provided in Section 3.05(a), are restated, amended or otherwise adjusted for any month or Performance
Period, then the reconciled amounts for such period shall be recalculated in accordance with the terms and conditions set forth in
Schedule 3, and the parties shall make further payments or set off further amounts as appropriate in respect of such
recalculations.

            (c)       
Prepayments.  Contractor and Continental may mutually agree from time to time for Contractor to make cash payments in
advance for estimated amounts due to Continental under this Agreement."

            Section 2.3.     Amendment to
Schedule 3

            (a)        Amendment to
Introductory Clause of Paragraph A of Schedule 3.  The introductory clause of Paragraph A of Schedule 3 is hereby amended
and restated in its entirety to read as follows:

A.          Base and Incentive Compensation.  Paragraphs (A)(1) and
(A)(2)(c) of this Schedule 3 shall apply for all applicable periods through December 31, 2004 and Paragraphs A(2)(a)
and (b) and Paragraph (A)(3) of this Schedule 3 shall apply for the Term."

            (b)        Amendment to
Paragraph A(2)(c) of Schedule 3.  Paragraph A(2)(c) of Schedule 3 is hereby amended and restated in its entirety to read
as follows:

c.         Appendix 10 Fee.  Contractor will receive a fee equal to the Appendix 10
invoice rate set forth in Appendix 10 for the applicable month multiplied by the number of Forecasted Passengers for the applicable
month, which fee represents payment for [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT].  This incentive compensation will be reconciled, in the monthly
reconciliation described in Section 3.06(b) of the Agreement.  If the Actual Passengers for such calendar month is greater
than the Forecasted Passengers, then the reconciliation for such period shall include a payment by Continental to Contractor in an
amount equal to the product of (i) the difference in the number of such passengers, multiplied by (ii) the Appendix 10
reconciliation rate set forth in Appendix 10 for the applicable month, which fee represents the same categories of expense as
represented by the per passenger invoice rate, other than passenger liability insurance and third-party security and screening
(Contractor Airports only), which category of expense is reconciled pursuant to Paragraph B(9)(a).  If the Forecasted
Passengers for such calendar month is greater than the Actual Passengers, the reconciliation for such period shall include a
payment by Contractor to Continental in an amount equal to the product of (i) the difference in such number of passengers
multiplied by (ii) the Appendix 10 reconciliation rate set forth in Appendix 10 for the applicable month."

            (c)        Amendment to
Paragraph A(3)(b) of Schedule 3.  Paragraph A(3)(b) of Schedule 3 is hereby amended and restated in its entirety to read
as follows:

b.         Expenses set forth in columns 4, 6, 9, 11, 12 and 13 of Appendix 1 for each
applicable month will be reduced by an amount equal to the product of (i) the amount of each of such expenses included in Appendix
1 Expenses (after giving effect to any previous adjustments thereto pursuant to this Paragraph A(3)(b)) and (ii) the quotient of
(1) the number of aircraft so withdrawn from the Agreement (after giving effect to any previous adjustments pursuant to this
Paragraph A(3)(b)) and (2) the number of aircraft constituting Delivered Covered Aircraft immediately prior to such
withdrawal."

            (d)        Amendment to
Paragraph A(3)(c) of Schedule 3.  Clauses I and II of Paragraph A(3)(c) of Schedule 3 are hereby amended and restated in
their entirety to read as follows:

I.          For the first [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] aircraft (other than Turboprop Aircraft)
to be withdrawn from the Agreement (taking into account all withdrawals under the Agreement), the remainder of the Appendix 1
Expenses after giving effect to any other adjustments provided in this Paragraph A(3) will be reduced by the product of (a) such
remainder of the Appendix 1 Expenses, multiplied by (b) [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] multiplied by (c) the quotient of (1) the number of aircraft
so withdrawn and (2) the number of aircraft constituting Delivered Covered Aircraft immediately prior to such withdrawal.

II.         For the next [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] aircraft (other than Turboprop Aircraft) to be
withdrawn from the Agreement (taking into account all withdrawals from the Agreement), the remainder of the Appendix 1 Expenses
after giving effect to any other adjustments provided in this Paragraph A(3) will be reduced by the product of (a) such remainder
of the Appendix 1 Expenses, multiplied by (b) [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] multiplied by (c) the quotient of (1) the number of aircraft so
withdrawn and (2) the number of aircraft constituting Delivered Covered Aircraft immediately prior to such withdrawal."

            (e)        Amendment to
Paragraph B(1) of Schedule 3.  Paragraph B(1) of Schedule 3 is hereby amended and restated in its entirety to read as
follows:

1.         Passenger and Cargo Revenue-Related Expenses.  With respect to Scheduled
Flights, passenger and cargo revenue-related expenses, including but not limited to commissions, taxes and fees related to the
transportation of passengers or cargo, food and beverage costs, charges for fare or tariff filings, sales and advertising costs,
computer reservation system fees, credit card discount fees, reservation costs, revenue accounting costs, including costs
associated with ticket sales reporting and unreported sales, OnePass participation costs and Continental Currencies, shall be
incurred directly by Continental."

            (f)        
Amendment to Paragraph B(4)(a) of Schedule 3.  Paragraph B(4)(a) of Schedule 3 is hereby amended and restated in its
entirety to read as follows:

a.         Administrative Costs.  The Appendix 3 Block Hour Rates, the Appendix 1
Expenses, Appendix 22 and Appendix 22a include allocations of administrative compensation costs.  The parties hereto have
entered into the Administrative Support and Information Services Provisioning Agreement, pursuant to which Continental has agreed
to provide Contractor with certain administrative services.  Pursuant to the Administrative Support and Information Services
Provisioning Agreement, the parties hereto have agreed to enter into a transition plan, which plan will provide for the termination
of the services provided by Continental to Contractor thereunder over a certain period of time.  As a result, certain of such
services may be terminated during the term of this Agreement.  Contractor and Continental hereby agree that in connection with
the transition plan Contractor and Continental shall meet and confer to adjust the Appendix 3 Block Hour Rates, Appendix 1
Expenses, Appendix 22 and Appendix 22a to reasonably reflect any increases or decreases in Contractor's administrative compensation
costs or other administrative costs and the costs payable to Continental pursuant to the Administrative Support and Information
Services Provisioning Agreement as a result of Contractor's having to replace any of such terminated services."

            (g)        Amendment to
Paragraphs B(5)(a) and (b) of Schedule 3.   Paragraphs B(5)(a) and (b) of Schedule 3 are hereby amended and restated in
their entirety to read as follows:

a.         With respect to Scheduled Flights, for any calendar month Contractor's actual
block hours flown for any particular aircraft type exceeds the end of month scheduled block hours for such aircraft type for such
calendar month, then the reconciliation for such period shall include a payment for such aircraft type by Continental to Contractor
in an amount equal to the product of (i) the First Incremental Cost Rate set forth on Appendix 11 with respect to such
aircraft type and such month, multiplied by (ii) the quotient of (1) the difference between such

  actual number of block hours and such number of end of month scheduled block hours divided by (2) such number of end of
month scheduled block hours (such quotient being the "Overfly Rate", which, when used in other Paragraphs of this Schedule 3, may
be a negative number), multiplied by (iii) the number of scheduled block hours for such aircraft type as set forth on the Final
Monthly Schedule multiplied by (iv) the First Benchmark Factor for such calendar month.

b.         With respect to Scheduled Flights, for any calendar month the end of month
scheduled block hours for any particular aircraft type exceeds Contractor's actual block hours flown for such aircraft type for
such calendar month, then the reconciliation for such period shall include a payment for such aircraft type by Contractor to
Continental in an amount equal to the product of (i) the Second Incremental Cost Rate, set forth on Appendix 12 with respect
to such aircraft type and month, multiplied by (ii) the quotient of (1) the difference between such number of end of month
scheduled block hours and such actual number of block hours, divided by (2) such number of end of month scheduled block hours,
multiplied by (iii) the number of scheduled block hours for such aircraft type as set forth on the Final Monthly Schedule
multiplied by (iv) the First Benchmark Factor for such calendar month."

            (h)        Amendment to
Paragraph B(6)(a), (b), (c), (d) and (e) of Schedule 3.  Paragraphs (B)(6)(a), (b), (c), (d) and (e) are hereby amended
and restated in their entirety to read as follows:

a.         If the product of the total number of Scheduled Flights for a particular
aircraft type during a calendar month as set forth in the Final Monthly Schedule multiplied by the First Cancellation Rate exceeds
the product of the actual Uncontrollable Cancellation Rate and the total number of Scheduled Flights of such aircraft type in such
calendar month as set forth in the Final Monthly Schedule (such excess number of flights of such aircraft type being the "First
Cancellation Number" for such aircraft type), then the reconciliation for such period shall include a payment by Continental to
Contractor in an amount equal to the product of (i) the First Incremental Cost Rate, as set forth on Appendix 11 for such aircraft
type and such month, multiplied by (ii) the First Cancellation Number for such aircraft type, multiplied by (iii) the scheduled
block hours per departure for such aircraft type for such calendar month as set forth in the Final Monthly Schedule, multiplied by
(iv) the sum of 1 and the Overfly Rate for such aircraft type for such calendar month.

The "Uncontrollable Cancellation Rate" for a particular aircraft type equals the actual Uncontrollable Cancellations for
such aircraft type divided by the actual end of month scheduled departures for such aircraft type.

b.         If the product of the actual Uncontrollable Cancellation Rate and the total
number of Scheduled Flights for a particular aircraft type during a calendar month as set forth in the Final Monthly Schedule
exceeds the product of the total number of Scheduled Flights as set forth in the Final Monthly Schedule for such aircraft type
during such calendar month multiplied by the First Cancellation Rate (such excess number of flights of such aircraft type being the
"Second Cancellation Number" for such aircraft type), then the reconciliation for such period shall include a payment by
Contractor to Continental in an amount equal to the product of (i) the Second Incremental Cost Rate, as set forth on Appendix 12
for such aircraft type and such month, multiplied by (ii) the Second Cancellation Number for such aircraft type, multiplied by
(iii) the scheduled block hours per departure for such aircraft type for such calendar month as set forth in the Final Monthly
Schedule, multiplied by (iv) the sum of 1 and the Overfly Rate for such aircraft type for such calendar month.

c.         If the product of the total number of Scheduled Flights for a particular
aircraft type as set forth in the Final Monthly Schedule during a calendar month multiplied by the Second Cancellation Rate exceeds
the product of the actual Controllable Cancellation Rate and the total number of Scheduled Flights for such aircraft type in such
calendar month as set forth in the Final Monthly Schedule (such excess number of flights of such aircraft type being the "Third
Cancellation Number" for such aircraft type), then the reconciliation for such period shall include a payment by Continental to
Contractor in an amount equal to the product of (i) the Third Incremental Cost Rate multiplied by (ii) the Third Cancellation
Number for such aircraft type, multiplied by (iii) the scheduled block hours per departure for such aircraft type for such calendar
month as set forth in the Final Monthly Schedule, multiplied by (iv) the sum of 1 and the Overfly Rate for such aircraft type for
such calendar month. 

The "Controllable Cancellation Rate" for a particular aircraft type equals the actual Controllable Cancellations for such
aircraft type divided by the actual end of month scheduled departures for such aircraft type.

The "Third Incremental Cost Rate" for a particular aircraft type equals the Fourth Incremental Cost Rate for such
aircraft type plus the Fifth Incremental Cost Rate for such aircraft type.

The "Fourth Incremental Cost Rate" for a particular aircraft type and for a particular month equals the product of (i)
the sum of (a) the applicable Appendix 13 Incremental Cost Rate set forth on Appendix 13 for such aircraft type and month,
minus the sum of (1) the Appendix 14 Block Hour Rate set forth on Appendix 14 for such aircraft type and month plus (2) the
Appendix 5 Block Hour Rate set forth on Appendix 5 for such aircraft type and month, plus (b) the Adjusted Appendix
14

Block Hour Rate for such aircraft type and month plus (c) the Third Adjusted Block Hour Rate for such aircraft type and month
and (ii) the First Benchmark Factor for such month.

The "Adjusted Appendix 14 Block Hour Rate" for a particular aircraft type and a particular month is obtained by
multiplying the Appendix 14 Block Hour Rate by the Appendix 7 Block Hours set forth on Appendix 7 for such aircraft type and
dividing such product by the average scheduled block hours per departure for such aircraft type as set forth on the Final Monthly
Schedule.

The "Fifth Incremental Cost Rate" is obtained by allocating the Appendix 1 Expenses among the different aircraft types by
each type's allocable share of statistics from the Final Monthly Schedule based on the methodology set forth in Appendix 15,
and dividing such allocation to a specific aircraft type by the product of the scheduled block hours for such aircraft type set
forth in the Final Monthly Schedule multiplied by the First Benchmark Factor, then multiplying such quotient by the First Benchmark
Factor.

d.         If the product of the actual Controllable Cancellation Rate and the total
number of Scheduled Flights for a particular aircraft type in a calendar month as set forth in the Final Monthly Schedule exceeds
the product of the total number of Scheduled Flights as set forth in the Final Monthly Schedule for such aircraft type during such
calendar month multiplied by the Second Cancellation Rate (such excess number of flights of such aircraft type being the "Fourth
Cancellation Number" for such aircraft type), then the reconciliation for such period shall include a payment by Contractor to
Continental in an amount equal to the product of (i) the Third Incremental Cost Rate for such aircraft type multiplied by (ii) the
Fourth Cancellation Number, multiplied by (iii) the scheduled block hours per departure for such aircraft type for such calendar
month as set forth in the Final Monthly Schedule, multiplied by (iv) the sum of 1 and the Overfly Rate for such aircraft type for
such calendar month.

e.         For purposes of this Paragraph B(6), for any month during which a Labor
Strike occurs, the Second Cancellation Rate for such month shall be adjusted to equal the difference between (a) the Second
Cancellation Rate for such month (before any such adjustment) and (b) the product of  (1) the quotient of (i) the Second
Cancellation Rate for such month (before any such adjustment) divided by (ii) the number of days in the particular month,
multiplied by (2) the number of days in such month during which such Labor Strike was occurring.  For purposes of this
Paragraph B(6), for any month during which a Labor Strike occurs, the First Cancellation Rate for such month shall be adjusted to
equal the difference between (a) the First Cancellation Rate for such month (before any such adjustment) and (b)

the product of (1) the quotient of (i) the First Cancellation Rate for such month (before any such adjustment) divided by (ii)
the number of days in such month multiplied by (2) the number of days in such month during which such Labor Strike was
occurring."

            (i)        
Amendment to Paragraph B(8)(b) of Schedule 3.  Paragraph B(8)(b) of Schedule 3 is hereby amended to add the following
clause VI:

VI.       Pilot Hybrid Training Cycles.  If a Pilot Hybrid Training Cycle is completed during
a given month, Continental shall pay an amount to Contractor equal to the quotient of (a) product of (1) such actual number of
Pilot Hybrid Training Cycles completed during such month and such aircraft type and (2) the assumed cost of each Pilot Hybrid
Training Cycle for such month and such aircraft type as set forth in Appendix 17a divided by (b) the Cost Difference set
forth on Appendix 23."

            (j)        
Amendment to Paragraphs B(8)(d) and (e) of Schedule 3.  Paragraphs B(8)(d) and (e) of Schedule 3 are hereby amended and
restated in their entirety to read as follows:

d.         Pilot Soft Time Reconciliation.  Included in the Appendix 3 Block Hour
Rates is an assumed cost associated with an assumed number of Pilot Flight Paid Hours per scheduled Pilot Block Hour.  If the
actual number of Pilot Flight Paid Hours per scheduled Pilot Block Hour for a particular month exceeds the number of assumed Pilot
Flight Paid Hours per scheduled Pilot Block Hour in such month as set forth in Appendix 19, then Continental shall pay an amount to
Contractor equal to the quotient of (a) the product of (i) the difference between (1) such actual number of Pilot Flight Paid Hours
per scheduled Pilot Block Hour during such month and (2) such assumed number of Pilot Flight Paid Hours per scheduled Pilot Block
Hour during such month, multiplied by (ii) the number of scheduled Pilot Block Hours for such month, multiplied by (iii) the
assumed amount payable for each Pilot Flight Paid Hour as set forth in Appendix 19, multiplied by (iv) [CONFIDENTIAL MATERIAL
OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] divided
by (b) the Cost Difference set forth in Appendix 23.  If the actual number of Pilot Flight Paid Hours per scheduled Pilot
Block Hour for a particular month is less than the number of assumed Pilot Flight Paid Hours per scheduled Pilot Block Hour in such
month as set forth in Appendix 19, then Contractor shall pay an amount to Continental equal to the quotient of (a) the product of
(i) the difference between (1) such assumed number of Pilot Flight Paid Hours per scheduled Pilot Block Hour during such month and
(2) such actual number of Pilot Flight Paid Hours per scheduled Pilot Block Hour during such

month, multiplied by (ii) the number of scheduled Pilot Block Hours for such month, multiplied by (iii) the assumed amount
payable for each Pilot Flight Paid Hour as set forth in Appendix 19, multiplied by (iv) [CONFIDENTIAL MATERIAL OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] divided by (b) the 
Cost Difference set forth in Appendix 23.  The reconciliation described in this Paragraph 8(d) will cease upon the earlier to
occur of (1) Contractor hiring a New Contractor Pilot and (2) Contractor no longer employing any Continental Pilots.

e.           Pilot Seniority Reconciliation.  Included in the Appendix 1
Expenses and the Appendix 3 Block Hour Rates is an assumed cost associated with an assumed number of Continental Pilots continuing
to be employed by Contractor.  If the aggregate number of Continental Pilots whose employment is actually terminated by
Contractor in a particular month exceeds the aggregate number of Continental Pilots whose employment by Contractor is assumed to be
terminated in such particular month as set forth in Appendix 20, then Contractor shall pay an amount to Continental equal to
the quotient of (a) the product of (i) the difference between (1) such aggregate number of Continental Pilots whose employment is
actually terminated by Contractor during such month and (2) such aggregate number of Continental Pilots whose employment is assumed
to be terminated by Contractor during such month, multiplied by (ii) the assumed amount payable per Continental Pilot being
terminated by Contractor as set forth in Appendix 20, divided by (b) the Cost Difference set forth on Appendix
23.  If the aggregate number of Continental Pilots whose employment is assumed to be terminated by Contractor for a
particular month as set forth in Appendix 20 exceeds the aggregate number of Continental Pilots whose employment is actually
terminated by Contractor during such month, then Continental shall pay an amount to Contractor equal to the quotient of (a) the
product of (i) the difference between (1) such aggregate number of Continental Pilots whose employment is assumed to be terminated
by Contractor during such month and (2) such aggregate number of Continental Pilots whose employment is actually terminated by
Contractor during such month, multiplied by (ii) the assumed amount payable per Continental Pilot being terminated by Contractor as
set forth in Appendix 20, divided by (b) the Cost Difference set forth on Appendix 23.  The reconciliation
described in this Paragraph 8(e) will cease when at least [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] Continental Pilots' employment shall have been
terminated by Contractor."

            (k)        Amendment to
Paragraph B(8)(f) of Schedule 3.  Paragraph B(8)(f) of Schedule 3 is hereby amended by replacing all references therein to
"[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT]" with "[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]."

            (l)        
Addition of Paragraph B(8)(g) of Schedule 3.  Schedule 3 is hereby amended by adding the following Paragraph
B(8)(g):

g.         Charter Flying.  For any calendar month during which Contractor used
Covered Aircraft to provide charter service to Continental, the reconciliation for such month shall include a payment by
Continental to Contractor for each aircraft type used to provide such charter service equal to the product of (i) the amount
payable per Charter Hour for such aircraft type as set forth in Appendix 24, multiplied by (ii) the number of Charter Hours for
such month."

            (m)       Amendment to
Paragraph B(9)(a) of Schedule 3. 

            (1)        Amendment to
clause (ix).  Clause (ix) of the first sentence of Paragraph B(9)(a) is hereby amended and restated to read as follows:

(ix)       payments by Contractor to employees in respect of any profit-sharing and on-time
performance plans of Contractor existing on or prior to the Distribution Date (provided that Continental shall not be required to
reconcile actual profit-sharing and on-time performance expenses to the extent that such additional expenses are attributable to a
change in target benchmarks or payment rates under such plans on or after the Distribution Date, and provided further that
reconciliation for profit-sharing plans shall only occur at the end of each fiscal year, which reconciliation shall be for the full
fiscal year, rather than on a month to month basis and provided further that reconciliation for actual costs of Contractor
associated with profit sharing plans is capped at the level contemplated in the rates);"

            (2)        Amendment to
add clause (xvi).  Clause (xv) of the first sentence of Paragraph B(9)(a) of Schedule 3 is hereby amended and restated to read
as follows and a new clause (xvi) immediately following clause (xv) is hereby added as follows:

(xv)      third-party security and screening expense at Contractor Airports; and (xvi) third-party
ground handling expense (collectively, the "Reconciled Expenses")."

            (3)        Amendment to
penultimate sentence.  The penultimate sentence of Paragraph B(9)(a) is hereby amended and restated in its entirety to read as
follows:

"If in any month the Contractor's actual Reconciled Expenses exceed the amount of Reconciled Expenses included in the Base
Compensation in accordance with Appendix 22 and with respect to certain Reconciled Expenses as further provided in Paragraph
B(9)(f) below for such month, Continental shall pay to Contractor an amount equal to the quotient of (i) such difference divided by
(ii) the Cost Difference set forth on Appendix 23."

            (n)        Addition of
Paragraph B(9)(g) of Schedule 3.  Schedule 3 is hereby amended by adding the following Paragraph B(9)(g):

g.         Continental may from time to time request Contractor to provide ground
handling services to [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT] "

            (o)        Addition of
Paragraph B(9)(h) to Schedule 3.  Schedule 3 is hereby amended by adding the following Paragraph B(9)(h):

h.         As part of the reconciliation contemplated by Section 3.06(b) of the
Agreement in respect of a particular month, Continental will pay Contractor an amount in cash equal to the difference between (i)
the Preferred Dividend Amount with respect to such month and (ii) the BC Interest Amount with respect to such month."

            (p)        Addition of
Section 12 to Schedule 3.  Schedule 3 is hereby amended by adding the following Section 12:

            12.       Delivery of
Electronic Appendices.  Each of Continental and Contractor hereby (i) acknowledges the receipt of electronic copies of the
Appendices referred to in this Schedule 3 (the "Electronic Appendices"), (ii) acknowledges and agrees that many of the
Appendices attached hereto in paper form contain numbers that have been rounded to a specified dollar amount or decimal point,
(iii) acknowledges and agrees that the Electronic Appendices contain numbers that have not been so rounded and (iv) agrees that the
numbers contained in the Electronic Appendices shall be used for purposes of making the calculations described in this Schedule
3.

            (q)        Amendments to
Appendices to Schedule 3. 

            (1)        Amendment to
Appendix 1.  Appendix 1 to Schedule 3 is hereby replaced with the Appendix 1 attached hereto as Annex A.

            (2)        Amendment to
Appendix 3  Appendix 3 to Schedule 3 is hereby replaced with the Appendix 3 attached hereto as Annex B.

            (3)        Amendment to
Appendix 4.  Appendix 4 to Schedule 3 is hereby replaced with the Appendix 4 attached hereto as Annex C.

            (4)        Amendment to
Appendix 11.  Appendix 11 to Schedule 3 is hereby replaced with Appendix 11 attached hereto as Annex D.

            (5)        Amendment to
Appendix 12.  Appendix 12 to Schedule 3 is hereby replaced with Appendix 12 attached hereto as Annex E.

            (6)        Amendment to
Appendix 13.  Appendix 13 to Schedule 3 is hereby replaced with the Appendix 13 attached hereto as Annex F.

            (7)        Amendment to
Appendix 14.  Appendix 14 to Schedule 3 is hereby replaced with the Appendix 14 attached hereto as Annex G.

            (8)        Amendment to
Appendix 15.  Appendix 15 to Schedule 3 is hereby replaced with the Appendix 15 attached hereto as Annex H.

            (9)        Amendment to
Appendix 17a.  Appendix 17a to Schedule 3 is hereby replaced with the Appendix 17a attached hereto as Annex I.

            (10)      Amendment to Appendix
21.  Appendix 21 to Schedule 3 is hereby replaced with the Appendix 21 attached hereto as Annex J.

            (11)      Amendment to Appendix
22.  Appendix 22 to Schedule 3 is hereby replaced with the Appendix 22 attached hereto as Annex K.

            (12)      Amendment to Appendix
22a.  Appendix 22a to Schedule 3 is hereby replaced with the Appendix 22a attached hereto as Annex L.

            (13)      Amendment to Add Appendix
24.  Schedule 3 is hereby amended to add thereto the Appendix 24 attached hereto as Annex M.

            Section 2.4.     Amendment to
Exhibit A

            (a)        Amendment to
add Definition of BC Interest Amount.  Exhibit A to the Capacity Purchase Agreement is hereby amended to add the following
definition of "BC Interest Amount":

"BC Interest Amount -- means, with respect to any particular calendar month, an amount in cash equal to the amount of interest
that shall have accrued (regardless of whether such interest is required to be paid during such month) on the ExpressJet Note
during such month."

            (b)        Amendment to
Definition of Change of Control.  Exhibit A to the Capacity Purchase Agreement is hereby amended to amend and restate in its
entirety clause (ix) of the definition of "Change of Control" to read  as follows:

(ix)       Incumbent Directors (meaning in each case, members of the applicable Board of Directors
who (a) were members of the Board of Directors of ExpressJet, XJT or Holdings, respectively, as of March 1, 2002 or (b) became a
director subsequent to March 1, 2002, whose appointment to fill a vacancy or to fill a new position on the applicable Board of
Directors or whose nomination for election by the shareholders of ExpressJet, XJT or Holdings, as the case may be, was approved by
a vote of at least a majority of the directors then comprising the Incumbent Directors) cease for any reason to constitute at least
a majority of the Board of Directors of ExpressJet, XJT or Holdings, respective; or"

            (c)        Amendment to
add Definition of Charter Flying.  Exhibit A to the Capacity Purchase Agreement is hereby amended to add the following
definition of "Charter Flying":

"Charter Flying – means any flying of Delivered Covered Aircraft for charter operations at the direction of Continental
that is not reflected in the Final Monthly Schedule."

            (d)        Amendment to
add Definition of Charter Hour.  Exhibit A to the Capacity Purchase Agreement is hereby amended to add the following
definition of "Charter Hour":

"Charter Hour – means each block hour associated with Charter Flying.

            (e)        Amendment to
add Definition of Continental Currencies.  Exhibit A to the Capacity Purchase Agreement is hereby amended to add the
following definition of "Continental Currencies":

"Continental Currencies – means inflight currency coupons issued by Continental that may only be purchased at any
Continental eService Center and may only be redeemed for alcoholic beverages or headsets on any Continental or Contractor
flight." 

            (f)        
Amendment to add Definition of Deemed Costs.  Exhibit A to the Capacity Purchase Agreement is hereby amended to add the
following definition of "Deemed Costs""

"Deemed Costs – means, for any Performance Period, the excess of (i) the amount by which Contractor is entitled to
reimbursement pursuant to the Block Hour Rates then in effect (and, with respect to certain benefits, the reconciliation provisions
of Schedule 3) in respect of labor costs (including all wages, salaries, profit sharing and other benefits to all Contractor
officers and other employees, including contract employees) over (ii) the amount of such labor costs actually incurred by
Contractor in such period.

            (g)        Amendment to
Definition of Excluded Costs.  Exhibit A to the Capacity Purchase Agreement is hereby amended to restate the definition of
"Excluded Costs" in its entirety to read as follows:

"Excluded Costs – means, for any Performance Period, (i) labor costs (including all wages, salaries, profit sharing and
other benefits to all Contractor officers and other employees, including contract employees) incurred in such period in excess of
those for which Contractor is entitled to reimbursement pursuant to the Block Hour Rates then in effect and, with respect to
certain benefits, the reconciliation provisions of Schedule 3, (ii) all costs allocable to Scheduled Flights cancelled during such
period as a result of strikes and other labor actions, disputes or interruptions, and other costs incurred during such period
outside of the ordinary course of business in connection with such events, (iii) all costs allocable to Scheduled Flights cancelled
during such period as a result of an event constituting Cause, and other costs incurred during such period outside of the ordinary
course of business in connection with such event, (iv) costs of litigation and threatened litigation (including investigations,
attorney's fees, adverse judgments and settlements not covered by insurance) incurred during such period, (v) adjustments resulting
from the physical inventory loss of any of Contractor's spare parts inventory (including but not limited to any spare engines,
rotable parts, repairable parts and expendable parts) ("Spare Parts Inventory") that deviate from Contractor's historical practice,
(vi) expenses associated with any accounting write-ups or write-downs of any of Contractor's Spare Parts Inventory as a result of
any business practice or decision in respect of Contractor's Spare Parts Inventory that deviates from Contractor's historical
practice; and (vii) other expenses incurred during such period that do not comprise a portion of the Block Hour Rates reflected in
Schedule 3 and are not reasonable and customary in the industry, or were not otherwise approved in advance by Continental (it being
understood that the expenses reimbursed pursuant to reconciliation provisions of Schedule 3 constitute expenses that
comprise a portion of the Block Hour Rates reflected in Schedule 3)."

            (h)        Amendment to
Definition of Excluded Revenue.  Exhibit A to the Capacity Purchase Agreement is hereby amended to restate the definition
of "Excluded Revenue" in its entirety to read as follows:

"Excluded Revenue – means, for any Performance Period, (i) all incentive compensation payable in respect of such period
pursuant to Paragraph A(2)(a) and Paragraph A(2)(b) of Schedule 3, (ii) all Incentive Amounts payable pursuant
to Paragraph B(6)(c) and Paragraph B(6)(d) of Schedule 3 in respect of such period and (iii) reconciliations pursuant
to Paragraph B(9)(g) and Paragraph B(9)(h) of Schedule 3."

            (i)        
Amendment to add Definition of ExpressJet Note.  Exhibit A to the Capacity Purchase Agreement is hereby amended to add
the following definition of "ExpressJet Note":

"ExpressJet Note – means that certain Floating Rate Note, issued April 16, 2002, made in favor of XJT and previously
delivered to Continental as in effect on such date."

            (j)        
Amendment to add Definition of ExpressJet Preferred Stock.  Exhibit A to the Capacity Purchase Agreement is hereby
amended to add the following definition of "ExpressJet Preferred Stock":

"ExpressJet Preferred Stock – means the Series A Preferred Stock, par value $.01 per share, of New ExpressJet Airlines,
Inc. as designated by that certain Certificate of Designation of Series A Preferred Stock of New ExpressJet Airlines, Inc. dated as
of April 16, 2002 and as in effect on such date."

            (k)        Amendment to
Definition of Incentive Amount.  Exhibit A to the Capacity Purchase Agreement is hereby amended to amend and restate the
definition of "Incentive Amount" in its entirety as follows:

"Incentive Amount – means either (1) the portion of the reconciliation amount payable from Continental to Contractor
pursuant to Paragraph B(6)(c) of Schedule 3 for a particular month and aircraft type equal to the product of (a) the difference
between the Third Incremental Cost Rate and the First Incremental Cost Rate for such month and aircraft type, multiplied by (b) the
Third Cancellation Number for such aircraft type, multiplied by (c) the number of block hours per departure for such aircraft type
and calendar month as set forth in the Final Monthly Schedule, or (2) the portion of the reconciliation amount payable from
Contractor to Continental pursuant to Paragraph B(6)(d) of Schedule 3 for a particular month and aircraft type equal to the product
of (a) the difference between the Third Incremental Cost Rate and the First Incremental Cost Rate for such month and aircraft type,
multiplied by (b) the Fourth Cancellation Number for such aircraft type, multiplied by (c) the number of block hours per departure
for such aircraft type and calendar month as set forth in the Final Monthly Schedule.

            (l)        
Amendment to definition of Incremental Passenger-Related Facilities.  Exhibit A to the Capacity Purchase Agreement is
hereby amended to amend and restate the definition of "Incremental Passenger-Related Facilities" in its entirety as follows:

            "Incremental Passenger-Related Facilities" – means
"Incremental Contractor Terminal Facilities" as such term is defined in the Master Facility and Ground Handling Agreement.

            (m)       Amendment to
Definition of New Contractor Pilot.  Exhibit A to the Capacity Purchase Agreement is hereby amended to amend and restate
the definition of "New Contractor Pilot" in its entirety as follows:

"New Contractor Pilot – means any Person actively employed by Contractor as a pilot whose employment began after January
1, 2002 or was recalled from a furlough that occurred prior to January 1, 2002."

            (n)        Amendment to
delete Passenger-Related Terminal Facilities.  Exhibit A to the Capacity Purchase Agreement is hereby amended to delete
the definition of "Passenger-Related Terminal Facilities" therefrom.

            (o)        Amendment to
add Definition of Pilot Hybrid Training Cycles.  Exhibit A to the Capacity Purchase Agreement is hereby amended to add the
following definition of "Pilot Hybrid Training Cycle":

"Pilot Hybrid Training Cycle -- means any pilot training required by the FAA lasting between [CONFIDENTIAL MATERIAL OMITTED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] days in duration,
excluding Pilot New Hire Training Cycles, Pilot Recurrent Flight Training Cycles, Pilot Recurrent Ground Training Cycles, Pilot
Transitional Training Cycles and Pilot Upgrade Training Cycles."

            (p)        Amendment to
add Definition of Preferred Dividend Amount.  Exhibit A to the Capacity Purchase Agreement is hereby amended to add the
following definition of "Preferred Dividend Amount":

"Preferred Dividend Amount – means, with respect to any particular calendar month, an amount in cash equal to the amount
of dividends that accrue (regardless of whether such dividends are declared or paid) on the ExpressJet Preferred Stock during such
month."

            (q)        Amendment to
change Definition of Prevailing Margin.  Exhibit A to the Capacity Purchase Agreement is hereby amended to amend and
restate the definition of "Prevailing Margin" in its entirety as follows:

"Prevailing Margin" – means, for any Performance Period, the decimal fraction (in any event not less than zero) equal to
(i) Contractor's earnings before interest, taxes and extraordinary items derived from the Scheduled Flights (as determined by the
separate books maintained by Contractor for the Regional Airline Services pursuant to Section 3.05(a)), divided by (ii)
Contractor's aggregate revenues allocable to Scheduled Flights,  in each of clauses (i) and (ii) above as reflected on the
books and records of Contractor after giving effect to the provisions of Section 3.06(b), except for any reconciliation pursuant to
Paragraph B(9)(d) of Schedule 3.  In making the calculation described in clause (i) of the immediately preceding sentence, (a)
Excluded Revenues shall be excluded from the revenues of Contractor, (b) Excluded Costs shall be excluded from the expenses of
Contractor and (c) Deemed Costs shall be included as expenses of Contractor.  In making the calculation described in clause
(ii) of the immediately preceding sentence, Excluded Revenues shall be excluded from the revenues of Contractor.

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

            Section 3.1.     Representations
and Warranties of Holdings, XJT and ExpressJet

  Holdings, XJT and ExpressJet, jointly and severally, represent, warrant and covenant to Continental as of the date hereof
as follows:

            (a)        Organization
and Qualification.  Each of Holdings, XJT and ExpressJet is a duly organized and validly existing corporation in good
standing under the laws of the State of Delaware and has the corporate power and authority to own, operate and use its assets and
operate the Regional Airline Services.

            (b)        Authority
Relative to this Agreement.  Each of Holdings, XJT and ExpressJet has the corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby in accordance with the terms hereof.   The
execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by
all necessary corporate action on the part of each of Holdings, XJT and ExpressJet.  This Agreement has been duly and validly
executed and delivered by each of Holdings, XJT and ExpressJet and is, assuming due execution and delivery thereof by Continental
and that Continental has legal power and right to enter into this Agreement, a valid and binding obligation of each of Holdings,
XJT and ExpressJet, enforceable against each of Holdings, XJT and ExpressJet in accordance with its terms, except as enforcement
hereof may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating
to or affecting the enforcement of creditors' rights generally and legal principles of general applicability governing the
availability of equitable remedies (whether considered in a proceeding in equity or at law or otherwise under applicable law).

            (c)        Conflicts;
Defaults.  Neither the execution or delivery of this Agreement nor the performance by each of Holdings, XJT and ExpressJet
of the transactions contemplated hereby will (i) violate, conflict with, or constitute a default under any of the terms of either
Holdings', XJT's or ExpressJet's certificate of incorporation, by-laws, or any provision of, or result in the acceleration of any
obligation under, any material contract, sales commitment, license, purchase order, security agreement, mortgage, note, deed, lien,
lease or other agreement to which Holdings, XJT or ExpressJet is a party, (ii) result in the creation or imposition of liens in
favor of any third person or entity, (iii) violate any law, statute, judgment, decree, order, rule or regulation of any
governmental authority, or (iv) constitute any event which, after notice or lapse of time or both, would result in such violation,
conflict, default, acceleration or creation or imposition of liens.

            Section 3.2.     Representations
and Warranties of Continental

  Continental represents and warrants to Holdings, XJT and ExpressJet as of the date hereof as follows:

            (a)        Organization
and Qualification.  Continental is a duly incorporated and validly existing corporation in good standing under the laws of
the State of Delaware.

            (b)        Authority
Relative to this Agreement.  Continental has the corporate power and authority to execute and deliver this Agreement and
to consummate the transactions contemplated hereby in accordance with the terms hereof.  The execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action
on the part of Continental.  This Agreement has been duly and validly executed and delivered by Continental and is, assuming
due execution and delivery thereof by Holdings, XJT and ExpressJet and that Holdings, XJT and ExpressJet each has legal power and
right to enter into this Agreement, a valid and binding obligation of Continental, enforceable against Continental in accordance
with its terms, except as enforcement hereof may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting the enforcement of creditors' rights generally and legal principles of
general applicability governing the availability of equitable remedies (whether considered in a proceeding in equity or at law or
otherwise under applicable law).

            (c)        Conflicts;
Defaults.  Neither the execution or delivery of this Agreement nor the performance by Continental of the transactions
contemplated hereby will (i) violate, conflict with, or constitute a default under any of the terms of Continental's certificate of
incorporation, by-laws, or any provision of, or result in the acceleration of any obligation under, any material contract, sales
commitment, license, purchase order, security agreement, mortgage, note, deed, lien, lease or other agreement to which Continental
is a party, (ii) result in the creation or imposition of any liens in favor of any third person or entity, (iii) violate any law,
statute, judgment, decree, order,

  rule or regulation of any governmental authority, or (iv) constitute any event which, after notice or lapse of time or
both, would result in such violation, conflict, default, acceleration or creation or imposition of liens.

ARTICLE IV.

MISCELLANEOUS

            Section 4.1.     Effect of
Agreement

  Except as specifically amended hereby, the Capacity Purchase Agreement shall remain in full force and effect and is
ratified in all respects by the parties hereto.

            Section 4.2.     Binding Effect;
Assignment

  This Agreement and all of the provisions hereof shall be binding upon the parties hereto and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.  Except with respect to a merger of either party with
another Person, neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any party
hereto without the prior written consent of the other parties.

            Section 4.3.     Amendment and
Modification

  This Agreement may not be amended or modified in any respect except by a written agreement signed by the parties
hereto.

            Section 4.4.    
Counterparts

  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.  This Agreement may be executed by facsimile signature.

            Section 4.5.    
Severability

  Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof. 
Any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

            Section 4.6.     Entire
Agreement

  This Agreement is intended by the parties as a complete statement of the entire agreement and understanding of the
parties with respect to the subject matter hereof and all matters between the parties related to the subject matter herein set
forth.

            Section 4.7.     Governing
Law

  This Agreement shall be governed by and construed in accordance with the laws of the State of Texas (excluding Texas
choice-of-law principles that might call for the application of the law of another jurisdiction) as to all matters, including
matters of validity, construction, effect, performance and remedies.  Except as otherwise provided in Section 11.08(e) of the
Amended and Restated Capacity Purchase Agreement, any action arising out of this Agreement or the rights and duties of the parties
arising hereunder may be brought, if at all, only in the state or federal courts located in Harris County, Texas.

(Signature Page Follows)

            IN WITNESS WHEREOF, the parties hereto have caused this
Second Amendment to Amended and Restated Capacity Purchase Agreement to be duly executed and delivered as of the date and year
first written above.

                                                                                               
CONTINENTAL AIRLINES, INC.

                                                                                               
By:       /s/ Jeffery A.
Smisek                            

                                                                                               
Name:  Jeffery A. Smisek

                                                                                               
Title:  Executive Vice President

 

                                                                                               
EXPRESSJET HOLDINGS, INC.

                                                                                               
By:       /s/ Frederick S.
Cromer                       

                                                                                               
Name:  Frederick S. Cromer

                                                                                               
Title:     Vice President & Chief Financial Officer

                                                                                               
XJT HOLDINGS, INC.

                                                                                               
By:       /s/ Frederick S.
Cromer                       

                                                                                               
Name:  Frederick S. Cromer

                                                                                               
Title:     Vice President & Chief Financial Officer

 

                                                                                               
EXPRESSJET AIRLINES, INC.

                                                                                               
By:       /s/ Frederick S.
Cromer                       

                                                                                               
Name:  Frederick S. Cromer

                                                                                               
Title:     Vice President & Chief Financial Officer

 

Appendix 1

	
Appendix 1 Expenses (000's)

	
Date

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

	
Column

		
1

	
2

	
3

	
4

	
5

	
6

	
7

	
8

	
9

	
10

	
11

	
12

	
13

	
14

	
15

	
Jan-03

	

 

	

 [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY

 WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT

 TO A REQUEST FOR CONFIDENTIAL TREATMENT]

	
Feb-03

	
Mar-03

	
Apr-03

	
May-03

	
Jun-03

	
Jul-03

	
Aug-03

	
Sep-03

	
Oct-03

	
Nov-03

	
Dec-03

	
Jan-04

	
Feb-04

	
Mar-04

	
Apr-04

	
May-04

	
Jun-04

	
Jul-04

	
Aug-04

	
Sep-04

	
Oct-04

	
Nov-04

	
Dec-04

Appendix 3

	
Appendix 3 Block Hour Rates

	
Date

	
ATR42

	
RJ135

	
RJ145

	
Benchmark SL

	
200

	
325

	
525

	
Jan 03

	
  

	

 [CONFIDENTIAL MATERIAL OMITTED AND

 FILED SEPARATELY WITH THE SECURITIES

 AND EXCHANGE COMMISSION PURSUANT TO A

 REQUEST FOR CONFIDENTIAL TREATMENT]

	
Feb 03

	
Mar 03

	
Apr 03

	
May 03

	
June 03

	
Jul 03

	
Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

Appendix 4

	
Appendix 4 Block Hour Rates

	
Date

	
ATR42

	
RJ135

	
RJ145

	
Jan 03

	
   

	

 [CONFIDENTIAL MATERIAL OMITTED AND

 FILED SEPARATELY WITH THE SECURITIES

 AND EXCHANGE COMMISSION PURSUANT TO

 A REQUEST FOR CONFIDENTIAL

 TREATMENT]

	
Feb 03

	
Mar 03

	
Apr 03

	
May 03

	
June 03

	
Jul 03

	
Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

Appendix 11

	
First Incremental Cost Rates

	
Date

	
ATR42

	
RJ135

	
RJ145

	
Jan 03

	
  

	

 [CONFIDENTIAL MATERIAL OMITTED AND

 FILED SEPARATELY WITH THE SECURITIES

 AND EXCHANGE COMMISSION PURSUANT TO A

 REQUEST FOR CONFIDENTIAL TREATMENT]

	
Feb 03

	
Mar 03

	
Apr 03

	
May 03

	
June 03

	
Jul 03

	
Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

Appendix 12

	
Second Incremental Cost Rates

	
Date

	
ATR42

	
RJ135

	
RJ145

	
Jan 03

	
  

	

 [CONFIDENTIAL MATERIAL OMITTED AND

 FILED SEPARATELY WITH THE SECURITIES

 AND EXCHANGE COMMISSION PURSUANT TO A

 REQUEST FOR CONFIDENTIAL TREATMENT]

	
Feb 03

	
Mar 03

	
Apr 03

	
May 03

	
June 03

	
Jul 03

	
Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

Appendix 13

	
Appendix 13 Incremental Cost Rates

	
Date

	
 

	
ATR42

	
RJ135

	
RJ145

	
Jan 03

	
  

	

 [CONFIDENTIAL MATERIAL OMITTED AND

 FILED SEPARATELY WITH THE SECURITIES

 AND EXCHANGE COMMISSION PURSUANT TO A

 REQUEST FOR CONFIDENTIAL TREATMENT]

	
Feb 03

	
Mar 03

	
Apr 03

	
May 03

	
June 03

	
Jul 03

	
Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

Appendix 14

	
	
Incremental Block Hour Rates

	
Date

 Benchmark SL

	
ATR42

 200

	
RJ135

 325

	
RJ145

 525

	
Jan 03

	
  

	

 [CONFIDENTIAL MATERIAL OMITTED AND

 FILED SEPARATELY WITH THE SECURITIES

 AND EXCHANGE COMMISSION PURSUANT TO A

 REQUEST FOR CONFIDENTIAL TREATMENT]

	
Feb 03

	
Mar 03

	
Apr 03

	
May 03

	
June 03

	
Jul 03

	
Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

Appendix 15

	
Fifth Incremental Cost Rate Allocation

	
Expense

	
Allocation Methodology

	
Aircraft Rent

	
        

	

 [CONFIDENTIAL MATERIAL OMITTED

 AND FILED SEPARATELY WITH THE

 SECURITIES AND EXCHANGE

 COMMISSION PURSUANT TO A

 REQUEST FOR CONFIDENTIAL

 TREATMENT]

	
Maintenance Overhead

	
Hull Insurance

	
Employee Incentives

	
Property Taxes

	
Depreciation

	
Management Fee

	
General & Administrative

	
Airport Overhead

	
CAL Fixed Pool of Expenses

	
Glycol

	
Snow Removal

	
De-icing

	
Airport Facility Rent

	
3rd Party Ground Handling

Appendix 17a

	
Assumed Pilot Training Cost Per Cycle

	
Training Cycle

	
2001

	
2002

	
2003

	
2004

	
RJ 

	
  

	

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  Transitional

	
  Upgrade

	
  New Hire

	
  Recur Ground

	
  Recur Flight

	
  Hybrid

	
 

	
ATR

	
  Transitional

	
  Upgrade

	
  New Hire

	
  Recur Ground

	
  Recur Flight

	
 

	
Total

	
  Transitional

	
  Upgrade

	
  New Hire

	
  Recur Ground

	
  Recur Flight

	
  Hybrid

	
	
 

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT]

Appendix 21

	
Airport Agent Volume Reconciliation

	
Date

	
Amount Payable Per

 Agent Paid Hour

	
Agent

 Paid Hours

	
Implied

 Sick Time %

	
Implied

 Overtime %

	
Implied

 Holiday %

	
Implied

 Vacation %

	
Jan 03

	
  

	

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Feb 03

	
Mar 03

	
Apr 03

	
May 03

	
June 03

	
Jul 03

	
Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

Appendix 22

	
 

	
Reconciliation of Expenses (000's)

	
Date

	
 

	
B(9)(a)

 (i)

	
B(9)(a)

 (ii)

	
B(9)(a)

 (iii)

	
B(9)(a)

 (iv)

	
B(9)(a)

 (v)

	
B(9)(a)

 (vi)

	
B(9)(a)

 (vii)

	
B(9)(a)

 (viii)

	
B(9)(a)

 (ix)

	
B(9)(a)

 (x)

	
B(9)(a)

 (xi)

	
B(9)(a)

 (xii)

	
B(9)(a)

 (xiii)

	
B(9)(a)

 (xiv)

	
B(9)(a)

 (xv)

	
B(9)(a)

 (xvi)

	
 

	
 

	
Jan 03

	
  

	

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Feb 03

	
 

	
Mar 03

	
 

	
Apr 03

	
 

	
May 03

	
 

	
June 03

	
 

	
Jul 03

	
 

	
Aug 03

	
 

	
Sep 03

	
 

	
Oct 03

	
 

	
Nov 03

	
 

	
Dec 03

	
 

	
Jan 04

	
 

	
Feb 04

	
 

	
Mar 04

	
 

	
Apr 04

	
 

	
May 04

	
 

	
Jun 04

	
 

	
Jul 04

	
 

	
Aug 04

	
 

	
Sep 04

	
 

	
Oct 04

	
 

	
Nov 04

	
 

	
Dec 04

Appendix 22a

		
 

	
First Implied Rates

 ATR 42  RJ135  RJ145

	
 

	
Second Implied Rates

 ATR 42  RJ135  RJ145

	
 

	
Third Implied

	
Date

				
Expenses (000's)

	
Jan 03

	
  

	

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Feb 03

	
Mar 03

	
Apr 03

	
May 03

	
June 03

	
Jul 03

	
Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

Appendix 24

	
	
Date

	
   

	
RJ135

	
RJ145

	
Jul 03

	
  

	

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Aug 03

	
Sep 03

	
Oct 03

	
Nov 03

	
Dec 03

	
Jan 04

	
Feb 04

	
Mar 04

	
Apr 04

	
May 04

	
Jun 04

	
Jul 04

	
Aug 04

	
Sep 04

	
Oct 04

	
Nov 04

	
Dec 04

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