Document:

<Page>

                                    AGREEMENT

                                     Between

                            CHAUTAUQUA AIRLINES, INC.

                                     And the

                      FLEET AND PASSENGER SERVICE EMPLOYEES

                          OF CHAUTAUQUA AIRLINES, INC.

                                As represented by

                   THE INTERNATIONAL BROTHERHOOD OF TEAMSTERS,
                                AIRLINE DIVISION

                                   Effective:

                      December 15, 1999 - December 15, 2005

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                                TABLE OF CONTENTS

ARTICLE                                                        Page

1.       Recognition, Purpose and Scope                         1-1
2.       Definitions                                            2-1
3.       Compensation                                           3-1
4.       Hours of Service                                       4-1
5.       Overtime                                               5-1
6.       Holidays                                               6-1
7.       Vacations                                              7-1
8.       Leaves of Absence                                      8-1
9.       Sick Leave                                             9-1
10.      Seniority                                             10-1
11.      Probation                                             11-1
12.      Filling of Vacancies                                  12-1
13.      Reduction in Force                                    13-1
14.      Expenses                                              14-1
15.      Grievance Procedures                                  15-1
16.      System Board of Adjustment                            16-1
17.      Physical Examinations                                 17-1
18.      Orders to Employees                                   18-1
19.      Training                                              19-1
20.      Moving Expenses                                       20-1
21.      Union Security                                        21-1
22.      Severance Pay                                         22-1
23.      Health and Welfare                                    23-1
24.      Safety and Health                                     24-1
25.      General                                               25-1
26.      Part-Time Employees                                   26-1
27.      Uniforms                                              27-1
28.      Duration                                              28-1

LETTERS OF AGREEMENT

Signing Bonus
Reopener
Personnel Files
Station Enhancement Fund
Out of Station Overtime Availability
Part Time Employee Schedules
Temporary Wage Rate Adjustments
Implementation

                                     Page 2
<PAGE>

                                    AGREEMENT

This Agreement, concerning the Fleet and Passenger Service Employees in the
service of Chautauqua Airlines, Inc., is entered into by and between Chautauqua
Airlines, Inc., hereinafter referred to as the "Company," and the International
Brotherhood of Teamsters (IBT), hereinafter referred to as the "Union," pursuant
to the terms of the Railway Labor Act, as amended, in the mutual interests of
the Fleet and Passenger Service Employees and of the Company in order to promote
safety, efficiency, and economy of operations, to provide for orderly collective
bargaining relations between the Company and the Union, to provide a means for
the prompt and equitable disposition of grievances, to provide a method for the
establishment of fair wages, hours of service, and working conditions for the
Fleet and Passenger Service Employees covered herein under, and to increase the
profitability of the Company. In making this Agreement it is recognized to be
the duty of the Union, the Fleet and Passenger Service Employees and the Company
to cooperate fully for the advancement of the purposes of this Agreement.

                                     Page 3
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                                    ARTICLE 1
                         RECOGNITION, PURPOSE AND SCOPE

A.       In accordance with Certification No. R-6371 issued by the National
         Mediation Board on June 23, 1995, the Company recognizes the
         International Brotherhood of Teamsters, Airline Division, as the
         collective bargaining representative of the Fleet and Passenger Service
         Employees employed by the Company, for the purposes of the Railway
         Labor Act, as amended.

B.       The purpose of this Agreement is in the mutual interest of the Company,
         the Union, and the Passenger and Fleet Service employees, to provide
         for the operation of the Company under methods that will further, to
         the fullest extent possible, the safety of air transportation, the
         efficiency of operation, and the continuation of employment of
         Passenger and Fleet Service employees under conditions of reasonable
         working conditions and proper compensation, and the profitability of
         the Company. It is recognized to be the duty of the Company, the Union,
         and the Passenger and Fleet Service employees to cooperate fully for
         the attainment of these purposes.

C.       This Agreement shall supersede all existing or previously executed
         agreements by and between the Company and the Union or any other labor
         organization or individual with respect to the rates of pay, rules, or
         working conditions specifically covered by the provisions of this
         Agreement in accordance with the provisions of the Railway Labor Act,
         as amended. Any and all subsequent agreements between the parties shall
         be reduced to writing, signed by their authorized representatives, and
         become a part of this Agreement.

D.       All work defined as Fleet and Passenger Service work shall be assigned
         to the employees covered by this Agreement.

E.       In accordance with applicable law, there shall be no discrimination by
         either party against any Passenger and Fleet Service employee because
         of age, race, sex, color, religion, union activity, national origin,
         handicap or disability that would not prevent them from safely
         performing the duties of a Passenger Service or Fleet Service employee.

F.       The provisions of this Agreement shall be binding upon the Company and
         its successors or assigns. In the event of a sale or merger in which
         the Company is the surviving entity, the terms and conditions of this
         Agreement shall be retained in full force and effect unless and until a
         determination is made by the National Mediation Board (NMB) as to a
         different representative for the craft or class thereunder.

         1.       Nothing in this Agreement shall prevent the Company from
                  either acquiring, or establishing, or merging with any other
                  carrier. In the event of such acquisition, establishment or
                  merger, the following will apply:

                  a.       The Company will not acquire or establish another air
                           carrier to replace any present flying performed in
                           and for the service of Chautauqua Airlines, Inc., or
                           to avoid the terms and conditions of this Agreement.

                                     Page 4
<PAGE>

                           i.       The Company may transfer any aircraft
                                    operated in the Chautauqua system to any
                                    other carrier either it or its parent
                                    controls as long as Chautauqua has
                                    sufficient aircraft to operate Chautauqua's
                                    system, so long as no covered employees will
                                    suffer any loss of pay or be laid off as a
                                    result of such transfer of aircraft.

                  b.       In the event the Company acquires or merges with
                           another air carrier, the operations are not
                           consolidated or merged until the seniority lists of
                           the two Fleet and Passenger Service groups are
                           integrated in accordance with Sections 3 and 13 of
                           the Allegheny-Mohawk Labor Protective Provisions; and

                           i.       The Company and the Union meet to negotiate
                                    an appropriate fence agreement pending the
                                    merger.

                           ii.      All other terms and conditions of this
                                    Agreement remain in full force and effect
                                    unless changes are mutually agreed to
                                    between the Union and the Company.

                           iii.     The respective Fleet and Passenger Service
                                    employees' collective bargaining agreements
                                    are merged into one (1) agreement as the
                                    result of negotiations between the Union and
                                    the Company. If a fully merged agreement is
                                    not executed within six (6) months from the
                                    date of merger and if a final and binding
                                    integrated Fleet and Passenger Service
                                    employees system seniority list is not
                                    issued, then the parties shall jointly
                                    submit outstanding issues to binding
                                    arbitration.

G.       Any masculine noun or pronoun used in this Agreement shall be
         recognized as referring to any employee covered under this Agreement,
         whether male or female.

H.       The Company shall have sole jurisdiction of the management and
         operation of its business, the direction of its working force, the
         right to maintain discipline and efficiency in its place of employment,
         and the right of the Company to hire, promote, demote, select for
         training, discipline, and discharge employees for just cause. The
         rights listed herein shall not be deemed to exclude or limit the other
         pre-existing rights of management not listed that do not conflict with
         other provisions of this Agreement.

I.       The Company will not enter into any dry lease or wet lease agreement
         without the agreement of the Union, nor contract with or for any other
         carrier or entities (government, military or commercial) for services
         within the scope of this Agreement without consulting with the Union.

                  1.       No employee within the bargaining unit will be
                           reduced in status or lose any income or employee
                           benefits while discussions are taking place.

                  2.       The Union will not disagree to a dry lease when such
                           dry lease is for the sole purpose of leasing out
                           excess aircraft owned or leased by the Company. No
                           aircraft dry leased to another carrier or entity will
                           be operated into or out of any cities where the
                           Company operates. Such dry lease will not result in
                           the reduction

                                     Page 5

<PAGE>

                           in status or the furlough of any Fleet
                           and Passenger Service Employee in cases where the dry
                           lease provides a profit to the Company. At the
                           request of the Union it may review the actual dry
                           lease documents.

                                     Page 6
<PAGE>

                                    ARTICLE 2
                                   DEFINITIONS

A.       "Business Agent" means a paid representative from the Union.

B.       "Calendar Day" means a period of time commencing at 0001 and ending at
         2400, based on local time at the station.

C.       "Calendar Month" means the first calendar day of any given month to and
         including the last calendar day of that month.

D.       "Classification Seniority" means the length of service as a Fleet or
         Passenger Service Employee with the Company.

E.       "Company Seniority" means the period of time the employee has served as
         an employee of the Company in any and all positions including covered
         and uncovered positions.

F.       "Day Off" means one calendar day free from scheduled duty.

G.       "Employee" means a person covered by this Agreement. He must be
         knowledgeable and capable of performing duties in the following areas
         as required: passenger ticketing, reservations, cargo procedures, gate,
         ramp, radio/telephone procedures, catering, deicing, towing/pushback
         and light cleaning.

H.       "Equalization" means records will be maintained for voluntary overtime
         hours to allow the overtime hours to be evenly distributed among the
         employee group.

I.       "Lead Agent" means an employee responsible for performing work in his
         duty assignment area as a working member of his group. He will be
         required to direct/train other employees assigned to him to ensure that
         the work assigned is performed in an efficient and productive manner. A
         lead agent does not have authority to discipline or discharge employees
         covered by this Agreement.

J.       "Light cleaning" means cleaning such as: wiping down of aircraft
         interior surfaces and windows, sweeping and vacuuming, crossing of seat
         belts, folding of blankets, removal of trash, cleaning and restocking
         of seatback pockets and overhead bins, mopping galley and lavatory
         floors.

K.       "Station" means the geographical location where an employee is assigned
         to work. Base, domicile, and location have the same meaning and are
         used interchangeably with station.

L.       "Shift" and "Work Shift" mean workdays.

M.       "Work Day" means that period of time beginning at the report time for a
         scheduled shift and continuing through the end of a scheduled shift. A
         workday may overlap two (2) calendar days and can include time for a
         split shift.

N.       "Work Period" means a work period that consists of a fourteen (14) day
         period with not more

                                     Page 7
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          than ten (10) consecutive work days and with at least two (2)
          consecutive calendar days off.

O.       "Work Week" means the first seven (7) days of a work period or the
         second seven (7) days of a work period.

P.       "Anniversary Year" means a one-year period, beginning from the
         individual employee's hire date.

                                     Page 8
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                                    ARTICLE 3
                                  COMPENSATION

A. Employees will be paid an hourly wage in accordance with the following
   schedule:

<TABLE>
<CAPTION>
                                            Pay Rate Pay Rate   Pay Rate           Pay Rate
                                            Effective         Effective           Effective         Effective
                  Longevity                 11/29/1999        12/15/2000          12/15/2001        12/15/2002
                  ---------                 ------------------------------------------------------------------
                <S>                         <C>               <C>                <C>               <C>

                  1-6 months                  7.10              7.28               7.46              7.65
                  7-12 months                 7.75              7.94               8.14              8.34
                  13-18 months                8.10              8.30               8.51              8.72
                  19-24 months                8.25              8.46               8.67              8.89
                  3rd year                    8.70              8.92               9.14              9.37
                  4th year                    9.20              9.43               9.67              9.91
                  5th year                    9.70              9.94              10.19             10.44
                  6th year                   10.10             10.35              10.61             10.88
                  7th year                   10.50             10.76              11.03             11.31
                  8th year                   11.00             11.28              11.56             11.85
                  9th year                   11.50             11.79              12.08             12.38
                  10th year                  12.00             12.30              12.61             12.93
                  11th year                  12.50             12.81              13.13             13.46

</TABLE>

B.       Employees who are designated as a Lead Agent shall be paid a minimum
         premium of one dollar ($1.00) per hour in addition to all applicable
         compensation for hours worked in that status and shall be included in
         the calculation of overtime calculation. An employee temporarily
         upgraded to a Lead Agent position shall receive the premium for all
         hours worked as a Lead Agent.

C.       Employees who are required to and obtain their weather observing
         license (and retain currency) will be paid a premium of thirty cents
         ($.30) per hour in addition to all applicable compensation for hours
         worked in that status. Employees who voluntarily obtain their weather
         observing license (and retain currency) will be paid a premium of
         thirty cents ($.30) per hour in addition to all applicable compensation
         when working at a station where weather observation is required.

D.       All employees shall be capable of performing all tasks assigned by
         management with the exception of flight attendant/maintenance/lead
         agent/pilot/dispatch/accounting/ and executive and there shall be no
         distinction for compensation or seniority because of the actual task
         performed except those enumerated in paragraphs B and C, above.

E.       When the Company has acknowledged that there is a shortage equal to one
         (1) day's pay or more in the pay of an employee, the employee will be
         reimbursed for such shortage as soon as possible but in no case later
         than three (3) working days.

F.       When there is an overpayment to a covered employee, the Company will
         notify the affected employee, provide documentation and substantiation
         of the overpayment and arrange a mutually agreeable repayment schedule.
         The Company may require the employee to authorize the Company to deduct
         repayment from his subsequent check(s). The maximum amount that can be

                                     Page 9
<PAGE>

         deducted from each pay period shall be fifty dollars ($50.00), unless
         the amount of overpayment exceeds five hundred dollars ($500.00), in
         which case the repayment amount will not be more than twenty percent
         (20%) of the original repayment amount per pay period. An employee and
         the Company may agree to different repayment terms.

G.       Paychecks will include an itemized statement of all hours, wages,
         adjustments and deductions for the pay period including, but not
         limited to: withheld taxes, union dues, 401(k) contributions, Section
         125 deductions, uniform deductions, etc., as well as year to date
         wages, FICA and withheld taxes.

H.       Employees leaving the service of the Company will be paid for all the
         time due at the earliest possible time after separation and in
         compliance with state law.

I.       Increases are effective for employees paid bi-weekly starting with the
         pay period that begins nearest the employee's anniversary date, and for
         employees paid weekly, starting with the pay period in which the
         anniversary date falls.

                                    Page 10
<PAGE>

<Page>

                                    ARTICLE 4
                                HOURS OF SERVICE

A.       All time worked in any continuous work day, including overtime, shall
         be considered as work performed on the calendar day the work day is
         started.

B.       Work schedules will be posted for bid as far in advance as possible but
         no later than ten (10) calendar days before the bid closing date. Work
         schedules will be awarded and posted ten (10) calendar days before
         their effective date. Work schedules may be rebid when required by the
         Company or once each ninety (90) calendar days from the date of the
         last rebid, whichever is sooner. If an employee fails to bid through no
         fault of his own, he will be assigned a work schedule closest to or the
         same as his previously scheduled starting time within his work
         assignment. If an employee does not bid sufficient slots or does not
         enter a bid, he will be assigned to any remaining open slot after all
         bids have been awarded.

         1.       Separate work schedules will be posted for each work
                  assignment, if applicable (Fleet Service, Passenger Service).
                  Award of work shifts, including hours and days off, shall be
                  based on applicable classification seniority.

         2.       An employee on an authorized leave of absence is not permitted
                  to bid a work schedule if his date of return to work is after
                  the expiration of such bid period. Employees returning after
                  such bid period or those who failed to bid while on such leave
                  will be assigned a work schedule.

         3.       An employee who transfers into another location will be
                  assigned a schedule until he participates in the next bid.

         4.       An employee may be scheduled up to thirteen (13) hours in any
                  one shift, excluding time for a meal period.

C.       Trading of shift assignment or days off shall be permitted if requested
         in writing and signed by all the employees involved in the swap and
         submitted no later than the day before the first intended swap and are
         subject to approval in writing by the appropriate manager, or his
         designee. Shift trades outside of duty assignment; for example, gate to
         ramp, etc., must be approved by appropriate management. Management
         reserves the sole discretion in approving swaps. Management will
         endeavor to accommodate the employee whenever practical.

         1.       There will be no overtime restrictions on employees who swap
                  shifts. However, there will be no overtime paid for any
                  scheduled hours as a result of shift swaps (See example
                  below). Employees who trade shifts become responsible to work
                  the shift as agreed to as if the shift were part of their
                  regular assignment.

                  Example:

                  a.       Joe has worked 75 hours
                           Mary has worked 70 hours

                                    Page 11
<PAGE>

                           Mary swaps with Joe for a 10-hour shift. Joe works 85
                           hours in pay period Joe receives no overtime pay.

                  b.       #1 has worked 75 hours
                           #2 has worked 75 hours
                           #2 swaps a 10-hour shift with #1
                           #1 works 85 hours in pay period
                           #1 gets paid for 5 hours overtime

                  c.       #1 is scheduled for a 10 hour shift
                           #2 swaps shift with #1 and actually works 11 hours.
                           #2 is paid 1 hour overtime

D.       For shifts scheduled for six (6) hours or more, unpaid meal periods of
         not less than thirty (30) minutes and not more then sixty (60) minutes
         shall be scheduled between the third (3rd) and fifth (5th) hour of the
         shift. If a meal period cannot be taken in the specified time frame, it
         will be rescheduled, and the employee will be paid one-half (1/2) hour
         at the applicable overtime rate in addition to his regular pay.

         E. The Company will not schedule an employee for less than nine (9)
         consecutive hours of rest between his shifts. When an employee is
         required to work and has less than nine (9) consecutive hours of rest
         between his shifts, the Company will either relieve him of duty with
         pay from such portion of his shift so as to give him the nine (9)
         consecutive hour rest period or compensate him for those hours worked
         at two (2) times his hourly rate for the number of hours his minimum
         rest period was reduced. If the employee is required to work overtime
         (mandatory) and this results in insufficient rest, the employee will
         then be entitled to this provision.

         This provision shall not apply:

         1.       If insufficient rest is caused as a result of the employee's
                  new work schedule at a periodic shift bid.

                  Example:

                  Joe worked on 4/15/99 until 11 PM. Periodic schedule changes
                  on 4/16/99. Joe's new start time is 6AM on 4/16. Joe gets no
                  additional pay or rest.

         2.       If the employee volunteers for overtime or a swap that causes
                  the insufficient rest.

         3.       If the employee is working a scheduled split shift.

F.       An employee transferred or assigned temporarily or permanently to a
         higher paying classification shall receive the higher rate of pay for
         all time worked in such classification. An employee

                                    Page 12
<PAGE>

         temporarily assigned to a lower paying classification shall not have
         his rates of pay reduced. An employee permanently reclassified to a
         lower paying classification shall have his pay rate lowered on the date
         of reclassification.

G.       When occasions arise beyond the Company's control, such as unscheduled
         absences, or due to weather or other Acts of God, then non-covered
         personnel may perform covered personnel's work until such time as there
         are sufficient covered personnel available, at their place of work, to
         perform their work through the awarding of voluntary overtime to
         employees, or, in the absence of volunteers, the assigning of mandatory
         overtime to employees, in reverse seniority order, utilizing the
         equalization process.

H.       In stations with twenty (20) or less employees, management personnel
         will be regularly scheduled to work and perform similar, same, and
         equal tasks as those performed by covered personnel.

I.       The Company may schedule employees for split shifts. A split shift
         schedule will include at least three (3) hours of scheduled work on
         each side of an unpaid break that is not scheduled to exceed six (6)
         hours. An employee may perform voluntary or involuntary overtime during
         the scheduled break.

                                    Page 13
<PAGE>

                                    ARTICLE 5
                                    OVERTIME

A.       Where the Company determines that overtime work is required, such
         voluntary overtime work will be proffered to qualified covered
         employees on an equalized basis.

B.       Voluntary overtime will be proffered to the covered employee whose name
         appears on the overtime availability list with the lowest number hours
         of overtime worked to the date of proffer. If two (2) or more
         volunteering employees have the same number hours of overtime, the
         senior employee will be offered the overtime first.

C.       If no employee accepts voluntary overtime, then the Company may assign
         mandatory overtime in reverse order of seniority, using an equalization
         method. Prior to assigning mandatory overtime the Company will:

         1.       Identify all available overtime in an Overtime Book, updated
                  daily and accessible at all times.

         2.       Make every reasonable effort to secure voluntary overtime.

         The Company will not utilize mandatory overtime as a means to
         circumvent the rest and normal staffing requirements of Article 4.

D.       All equalization records for voluntary overtime will be set back to
         zero (0) hours on January 1st, and July 1st of each calendar year.

E.       Voluntary overtime that is proffered to an employee one (1) hour or
         less prior to its beginning, if refused, will not be charged to the
         employee on equalization record as if worked.

F.       Voluntary overtime shall be paid as follows:

<TABLE>
         <S>     <C>                                                                  <C>

         1.       Time worked in excess of an employee's scheduled shift but
                  less than  twelve (12) hours in a single shift                        1 1/2X the hourly
                  rate

         2.       Time worked in excess of  twelve (12) hours in a single shift         2X the hourly rate

         3.       Time worked up to ten (10) hours on the first day off hourly rate     1 1/2X the

         4.       Time worked in excess of 10 hours on the first day off                2X the hourly rate

         5.       Time worked on a second or subsequent day off in a work week          2X the hourly rate

</TABLE>

G.       Mandatory overtime will be paid at the rate of 2X the hourly rate for
         all hours worked. Up to three (3) hours worked in excess of the
         scheduled shift during the last shift of the day, as a result of
         irregular flight operations, whether voluntary or involuntary, is not
         paid at the mandatory overtime rate.

                                    Page 14
<PAGE>

H.       When in the Company's judgment it is not economically efficient to work
         a continuous shift for one or more employees, split shifts may be
         scheduled.

                                    Page 15
<PAGE>

                                    ARTICLE 6
                                    HOLIDAYS

A.       An employee who is assigned to duty by the Company on any of the below
         listed holidays will receive pay at the compensation cited in Article
         6.D., below.

         New Year's Day             Labor Day             Day after Thanksgiving
         Thanksgiving Day           Memorial Day
         Christmas Day              Independence Day

B.       If an employee is scheduled to work a holiday and the employee does not
         show up for work without proper notice and valid cause, the employee
         will not receive holiday pay. Proper notice shall be defined as one (1)
         hour notice before start time of the employee's scheduled shift with a
         valid excuse.

C.       All full-time employees will receive eight (8) hours of pay on the
         above-designated holidays or eight (8) hours off with pay at the
         Company's discretion. All part-time employees will receive four (4)
         hours of pay on the above-designated holidays or four (4) hours off
         with pay at the Company's discretion. If an employee is absent for any
         reason on the scheduled work day before or after the holiday, he will
         not be entitled to pay for the holiday.

D.       Employees who work the holidays designated above will, in addition to
         the hours of pay provided for in paragraph C., above, be compensated at
         the greater of 11/2X their hourly rate for all hours worked on the
         holiday or the overtime provided for in Article 5.F.

                                    Page 16
<PAGE>

                                    ARTICLE 7
                                    VACATIONS

A.       Vacation Policy

         1.       All employees are eligible for paid vacation. The rate at
                  which an employee accrues vacation is based on the employee's
                  Company seniority. The number of days an employee actually
                  accrues vacation, to be used in the next year, is based on the
                  employee's accrual rate and the number of pay periods the
                  employee is active in the current year.

         2.       Accrual Schedule - The number of vacation hours an employee
                  actually receives will be based on his accrual rate and the
                  number of pay periods the employee is active in the prior
                  year. The employee must be at work, on paid sick leave, on
                  vacation, or on a Company-offered leave of absence for more
                  than one pay period in a month in order to be considered to be
                  an active employee for vacation accrual purposes.

                  The number of vacation hours earned is based on the following
                  rate of accrual:

                  Years of Service  Annual Accrual   Accrual Per Pay Period
                  ----------------------------------------------------------
                  1- 7 years        80 hours                   3.08 hours

                  8+ years          120 hours                  4.62 hours

         3.       Employees working on schedules other than five (5) day work
                  weeks will be paid for vacation based on forty (40) hours per
                  work week. Employees are compensated for earned vacation in
                  proportion to their normally scheduled work week in effect at
                  the time they take their vacations.

         4.       An employee who leaves the Company voluntarily will receive
                  full payment for unused vacation time credited from the
                  previous year as well as vacation accrued in the year of
                  separation.

         5.       An employee who has not accrued six (6) months of Company
                  seniority is not eligible for vacation pay upon termination.

         6.       In the event of the employee's retirement, permanent
                  disability or death, current year accruals will also be paid.

         7.       An employee may elect any of the following options in
                  connection with any unused vacation:

                  a.       Elect to be paid for remaining vacation.  Pay-out
                           will be made on the first paycheck following
                           January 1st of the next year, or

                  b.       Elect to carryover the remaining vacation to the next
                           year.

                                    Page 17
<PAGE>

B.    Vacation Bidding

         1.       Vacations will be bid by station and awarded based on
                  Classification Seniority.

         2.       Bids will open November 1st and close November 15th of each
                  year. Available vacation weeks will be evenly distributed
                  throughout the year. Bids will be submitted on the Vacation
                  Bid form. Vacation awards will be posted no later than
                  December 1st.

         3.       Once an employee is eligible for eighty (80) hours of vacation
                  or more, the employee may split the employee's vacation into
                  separate periods of complete weeks and, if a partial week
                  remains, it may be taken in conjunction with one (1) of the
                  employee's complete weeks.

         4.       Although vacation weeks are bid using the Sunday date, the
                  actual vacation begins following the scheduled days off in
                  that week except that employees with Friday and Saturday or
                  Saturday and Sunday will start their vacation in conjunction
                  with their days off at the beginning of that week, unless the
                  employee and the supervisor agree otherwise.

         5.       Employees who are involuntarily transferred may elect to keep
                  the vacation period they bid on the prior November bidding
                  period.

C.       VAC-DAT (Vacation-Day-At-A-Time)

         1.       Employees may elect to designate any amount of earned vacation
                  days to be taken as day-at-a-time (VAC-DAT). The employee may
                  designate the number of VAC-DAT days during the vacation
                  bidding in November.

         2.       During the year, an employee may request VAC-DAT for a
                  specific day or sequence of days if the employee has VAC-DAT
                  available. At each non-hub station at least one (1) VAC-DAT
                  per shift, per day, with a maximum of two (2) per day, and at
                  hub stations up to one (1) Passenger Service employee and one
                  (1) Fleet Service employee per shift per day to a maximum of
                  four (4) per day (two (2) per classification) will be
                  automatically approved provided the request is submitted at
                  least three (3) weeks in advance on a first- come,
                  first-served basis. Requests not eligible for automatic
                  approval will be reviewed and the employee notified whether it
                  is approved, within seventy-two (72) hours after submission.
                  Requests submitted with less than three (3) weeks notice may
                  also, subject to the needs of the operation, be approved.
                  Shift swaps submitted as a result of non-approved VAC-DAT
                  requests will not be denied.

         3.       Once a request has been properly made, the VAC-DAT must be
                  taken as scheduled unless agreed to otherwise by the employee
                  and the supervisor.

         4.       VAC-DAT cannot be scheduled on a holiday. Further, VAC-DAT
                  cannot infringe on any existing rules regarding a holiday.

         5.       An employee may split a VAC-DAT into one (1) hour increments.

                                    Page 18
<PAGE>

D.       Changes To The Posted Schedule

         1.       If necessary, additional periods will be opened during the
                  year to accommodate additional vacations because of an
                  increase in complement or changes in the work group that
                  increase the number of weeks to be taken, unless those weeks
                  can be accommodated in the existing periods. In all other
                  cases, any open week on the vacation schedule will be
                  available for employees within the vacation bid group who wish
                  to switch their scheduled weeks of vacation.

         2.       An employee must notify his supervisor at least two (2) weeks
                  prior to the employee's scheduled vacation period or two (2)
                  weeks prior to the effective date of the vacation period the
                  employee wishes to select, whichever occurs first. The request
                  must be made in writing. If the employee is the most senior
                  employee to make such a request, the supervisor will approve
                  the change, and the posted vacation schedule will be revised
                  accordingly.

         3.       Any vacation period vacated on the vacation schedule will
                  remain open for seventy-two (72) hours prior to being awarded
                  to the senior eligible bidder within the vacation group. No
                  vacation will be bid for seventy-two (72) hours after shift
                  bid change. Then the senior eligible bidder on the shift or
                  coming on the shift will bid first.

E.       Perfect Attendance Incentive

         For each rolling consecutive six (6) month period of perfect
         attendance, each full-time employee shall be entitled to eight (8)
         additional vacation hours, up to a maximum of sixteen (16) hours in
         each calendar year. Part-time employees will be eligible to receive
         four (4) hours and eight (8) hours respectively. At the option of the
         employee, perfect attendance days may be taken as day-at-a-time, added
         to the employee's vacation bank or, with the mutual agreement of the
         Company, added to the employee's awarded vacation days.

F.       Improvements to Vacation

         If the Company increases the amount of vacation entitlement for any
         other work group, excluding any represented work group, it will
         increase the entitlement for employees covered by this Agreement an
         equivalent amount.

                                    Page 19
<PAGE>

                                    ARTICLE 8
                                LEAVES OF ABSENCE

A.       Personal Leave of Absence - The Company at its sole discretion may
         grant a personal leave of absence without pay to an employee for a
         period of time determined by the Company, or as may be extended by
         written mutual agreement of the parties hereto. Employees shall submit
         their request for a personal leave of absence, or extension of a leave
         of absence, in writing, setting forth the reasons for the leave. The
         Company will then return to the employee a written approval or denial
         of the request. If the leave is approved, the Company shall, in
         writing, specify the details of the leave including, but not limited
         to, the date on which the employee must report back and be ready to
         work at his designated place of work. The Company reserves the right to
         terminate an employee's employment if he does not return to work on his
         designated return date. While on a personal leave the employee will
         continue to accrue seniority for up to ninety (90) days but will not
         accrue benefits. However, the employee on a personal leave of absence
         may elect to continue health and life insurance benefits, provided the
         employee pays in advance the full monthly cost of such benefits to the
         Company.

B.       Medical and Occupational Leave of Absence

         1.       A medical leave of absence, without pay, will be granted for a
                  non-occupational sickness or injury after the employee has
                  exhausted his accrued sick leave and upon the receipt of a
                  written verification from a qualified medical doctor. Such
                  written verification shall state at a minimum that (1) the
                  employee is unable to perform his work due to such disability,
                  (2) the doctor's estimate of the anticipated duration of the
                  medical leave and (3) the doctor's opinion that the employee
                  will be able to return to work in the same position the
                  employee had before the sickness or injury in less than five
                  (5) years.

         2.       The employee shall accrue Company and Classification Seniority
                  but not accrue benefits and/or pay during the period of a
                  leave for his medical disability.

         3.       In no case shall a medical leave exceed a total continuous
                  period of five (5) years.

         4.       An employee desiring to return to duty upon expiration of his
                  medical leave shall, in accordance with his seniority, be
                  permitted to return to his former position or, if the former
                  position is not available, utilize Article 13.A. to displace a
                  less senior employee.

         5.       Occupational Injury Leave of Absence - An unpaid leave of
                  absence will be granted to an employee who suffers an
                  occupational injury/sickness after the employee has exhausted
                  his accrued sick leave. If an employee is found fit for "light
                  duty" i.e., a physician certifies that an employee will be
                  able to return to full duty on a certain date and that he is
                  able to perform certain restricted duties as may be assigned
                  by the Company for up to a two (2) week period prior to such
                  release date, the Company will provide such light duties, if
                  such duties are available and said employee is qualified, to
                  aid in an employee's rehabilitation. An employee on
                  occupational injury leave shall retain and continue to accrue
                  seniority for a maximum of five (5) continuous years. After
                  five (5) continuous years the employer/employee relationship
                  will terminate.

                                    Page 20
<PAGE>

         6.       An employee who returns to work from an authorized leave of
                  absence within six (6) months of the last day he worked shall
                  be permitted to resume his position in the same status and
                  position to which he was assigned. If an employee does not
                  return to work within six (6) months of the last day he
                  worked, when he does return, he shall be permitted to assume
                  his former position, if still vacant, or exercise Article
                  13.A. to displace a less senior employee. If an employee does
                  not return to work on the specified date after a leave of
                  absence, his employment may be terminated at the Company's
                  option.

C.       Military leave - The Union and the Company agree to abide by all
         Federal and State laws in regard to the granting of military leave to
         employees who are called to Reserve or National Guard duty. The Company
         will grant a leave of absence, without pay, not to exceed fifteen (15)
         days, to any person ordered to Reserve or National Guard duty for
         annual training, or in the case of a national emergency, or as
         otherwise required by federal law. The employee shall give the Company
         notice within twenty-four (24) hours of the employee's receipt of
         notification of said active duty. An employee who desires to volunteer
         for extended duties must get prior approval from the Company.

D.       Jury Duty Leave

         1.       An employee shall provide the Station Manager with a copy of
                  the summons or notice of jury duty immediately upon the
                  receipt of such documents. The employee shall concurrently
                  provide the Company with authorization to intercede with the
                  appropriate authorities for the purpose of removing him from
                  jury duty.

         2.       An employee who is required to serve on jury duty shall be
                  granted a leave of absence for that purpose.

         3.       An employee who is called for jury duty will not be paid the
                  difference between his regular pay and jury duty pay.

         4.       Immediately upon release from jury duty, the employee shall
                  notify the Company of his availability for work. An employee
                  called for jury duty whose services in court are not required
                  on a specific day or who is released within two (2) hours of
                  reporting for jury duty will contact his supervisor to
                  determine if he is needed to report to work for the remainder
                  of the scheduled shift and will be paid for any hours actually
                  worked.

         5.       An employee on jury duty leave shall continue to accrue
                  seniority, longevity and all benefits as if he had been in
                  active service.

         6.       An employee may take an unpaid eight (8) hour rest prior to
                  serving on jury duty and/or an unpaid eight (8) hours rest
                  after being relieved from jury duty prior to reporting to
                  work.

E.       Bereavement/Emergency Leave

         1.       If a member of an employee's immediate family suffers a death,
                  he shall immediately notify the Station Manager and he will be
                  granted up to five (5) consecutive working days paid leave
                  beginning within five (5) calendar days following the date of
                  the death. An

                                    Page 21
<PAGE>

                  employee's immediate family shall be defined as an employee's
                  mother, father, spouse, children, stepchildren, brother, and
                  sister. Up to three (3) consecutive working days of paid leave
                  will be granted for the death of the employee's mother-in-law,
                  father-in-law, or grandparent.

         2.       Such family emergency leave may, upon request, be extended. If
                  the leave is extended, it shall be without pay or, at the
                  option of the employee, be with pay charged against the
                  employee's earned sick bank. The employee will be paid for all
                  scheduled hours of work during the leave period but not during
                  any extensions thereto, except as otherwise provided for in
                  this paragraph.

F.       Family and Medical Leave of Absence - All full-time and part-time
         employees covered by this Agreement, including those locations with
         less than fifty (50) employees, who have worked more than 1250 hours in
         the preceding twelve (12) months, and who have twelve (12) months of
         service, will be eligible for the "Family and Medical Leave Act of
         1993." While on family leave, the employee will continue to accrue
         seniority and all benefits, without interruption and at no cost to the
         employee. Upon return from family leave, the employee will have the
         option to return to the position held prior to the leave, or exercise
         Article 13.A.

G.       Union Leave

         1.       At the request of the Union (thirty (30) day advance notice
                  given to the Company) an employee shall be granted an
                  indefinite Union leave of absence without pay to accept
                  employment with the Teamsters Airline Division. While on such
                  leave, the employee shall continue to accrue seniority and
                  will be covered by Company health and life insurance the cost
                  of which will be reimbursed to the Company by the Union at the
                  monthly rate of twenty-three percent (23%) times the
                  employee's monthly regularly scheduled hours, prorated. The
                  employee will maintain all other benefits covered by this
                  Agreement and may continue to participate in the 401(k) Plan.
                  The Company's share of the 401(k) Plan shall be fully
                  reimbursed to the Company by the Union. No more than one (1)
                  employee shall be permitted a Union leave at one time. Upon
                  return from leave, an employee on Union leave will be given
                  recurrent training necessary to remain current as a Chautauqua
                  employee.

         2.       AT THE REQUEST OF THE UNION, THE COMPANY WILL, SUBJECT TO THE
                  NEEDS OF THE SERVICE, RELEASE EMPLOYEES FOR THE PURPOSE OF
                  CONDUCTING UNION BUSINESS. REQUESTS FOR RELEASE MUST BE
                  SUBMITTED IN WRITING TO THE STATION MANAGER AT LEAST SEVEN (7)
                  DAYS BEFORE THE REQUESTED DAY(S) OFF. THE COMPANY MAY WAIVE
                  THE SEVEN (7) DAY REQUIREMENT. SHIFTS DROPPED TO ACCOMMODATE
                  SUCH LEAVES WILL BE HANDLED AS PROVIDED IN ARTICLE 4.

         3.       Reimbursement for Pay Loss

                  Except as provided in Article 8.G.1., the Union shall
                  reimburse the Company for Union leave paid to an employee by
                  multiplying the number of hours normally scheduled to work and
                  paid by the Company times the applicable hourly rate for the
                  employee, plus twenty-three percent (23%) to cover the cost of
                  fringe benefits.

                                    Page 22
<PAGE>

H.       Maternity Leave

         1.       Maternity leave for employees shall be handled in accordance
                  with applicable law.

         2.       An employee shall notify the Company immediately upon
                  confirmation of her pregnancy.

         3.       A pregnant employee shall be permitted to continue in service
                  until her physician determines that she is no longer able to
                  perform all required employee duties.

         4.       An employee who ceases to perform employee duties shall be
                  placed on sick leave. Following exhaustion of sick leave
                  benefits, the employee shall be placed on medical leave.

I.       Return from Leave

         Immediately after the expiration of a leave of absence, an employee
         will return to the job classification and base station where he was
         assigned immediately prior to the leave. If the station no longer
         exists for employees, the employee may displace a less senior employee
         in the station of his choosing.

                                    Page 23
<PAGE>

                                    ARTICLE 9
                                   SICK LEAVE

A.       Sick Pay Bank

         Paid sick time is provided to allow the time off necessary to
         recuperate from illness or injury.

B.       Definitions

         1.       Sick Pay - is pay to an eligible non-probationary employee who
                  cannot perform his regular duties because of sickness
                  (physical or psychological) or non-occupational injury,
                  including maternity. Sick pay may also be utilized when an
                  employee's presence would jeopardize the health of others
                  because of exposure to a contagious disease. Sick pay does not
                  cover time for routine physical examinations or dental
                  check-ups. Pay during a period of sick absence will be based
                  on the employee's base rate and scheduled hours.

         2.       Worker's Compensation Temporary Disability Pay - is pay to an
                  eligible employee unable to work because of an injury on the
                  job at the Company.

                  a.       The injury must be one that is covered by the
                           applicable state worker's compensation law and must
                           be verified in writing by the treating physician.

                  b.       Payment for occupational injury by the Company's
                           insurance carrier, or the state, is generally set at
                           a percentage of the employee's average weekly wage.
                           However, this rate and the maximum weekly payment may
                           vary from state to state.

         3.       State Mandated Benefits - are disability income benefits
                  required by law in certain states. State mandated benefits may
                  include or require payments from an outside source.

         4.       In no event may an employee be entitled to State Mandated
                  Benefits and Sick Pay in excess of the employee's normal rate
                  of pay times his scheduled straight time hours.

         5.       Base Rate or regular rate, as used in this Article, is an
                  employee's base hourly rate plus all premiums he normally
                  receives.

C.       Sick and Occupational Injury Accrual

         Full time employees accrue hours of sick pay credits for each month
         that they are in a paid status, up to a maximum of six hundred sixty
         (660) hours sick pay (see paragraph K., below).

         YEARS OF SERVICE          PAY PERIOD ACCRUAL           ANNUAL ACCRUAL
         ---------------------------------------------------------------------
         1st Year                    .92 Hours                     24 Hours
         2nd Year                   1.54 Hours                     40 Hours
         3rd Year                   1.85 Hours                     48 Hours
         4th Year                   2.15 Hours                     56 Hours
         5th Year and thereafter    2.77 Hours                     72 Hours

                                    Page 24
<PAGE>

D.       Commencement and Payment of Paid Sick Time

         Sick time is paid based on the number of hours in the employee's
         regular work schedule. Pay will be at the employee's normal rate until
         his sick bank has been exhausted or the employee returns to work.

E.       Use of Sick Pay for an Occupational Injury

         An employee may elect to use his Sick Pay to supplement Worker's
         Compensation benefits.

F.       Exhaustion of Sick Pay

         When an employee exhausts his accrued sick leave, the employee will be
         placed on an unpaid medical leave of absence. An employee will not
         accrue Sick Pay while on a medical leave of absence.

G.       Travel While on Sick Pay Status

         Employees on sick pay status may use their pass privileges or reduced
         rate travel for personal travel. Eligible family members (and buddies
         if accompanied by the employee's spouse or other eligible family pass
         rider), are permitted to travel while the employee is in a paid status.
         To allow time for family members to return from trips in progress or be
         notified to make alternate travel arrangements, eligible family members
         may continue to travel for thirty (30) days from the date an employee's
         status changes to "unpaid" (i.e., an employee has exhausted his accrued
         sick leave)

H.       Request for Medical Documentation

         The Company may request a doctor's note after an employee has been off
         duty due to illness or injury in excess of three (3) consecutive days
         or where there may be suspected abuse.

I.       Worker's Compensation and Occupational Injury

         Worker's Compensation Temporary Disability payments will be made
         directly to the employee by the Worker's Compensation carrier (or the
         state) in the amount equal to the statutory requirements. Payments will
         be made to the employee, by the Company, in the amount calculated to be
         the difference between the employee's regular base pay and the
         statutory payment amount, until such time as the employee's accrued
         sick leave (if elected) is exhausted.

J.       Sick Pay Bank

         The maximum six hundred sixty (660) hour Sick Pay bank provided for in
         paragraph C above is divided into accounts of three hundred sixty (360)
         and three hundred (300) hours. Only after accruing the maximum three
         hundred sixty (360) hours in the first account may an employee begin
         accruing toward the maximum three hundred (300) hours in the second
         account. The three hundred (300) hour account may be used only for
         major, long term illness or injury (i.e. longer

                                    Page 25
<PAGE>

         than thirty (30) calendar days), and then only after the three hundred
         sixty (360) hour regular account has been exhausted. Upon retirement,
         employees are entitled to be paid for all accrued but unused sick pay
         bank hours.

                                    Page 26
<PAGE>

                                   ARTICLE 10
                                    SENIORITY

A.       Company seniority shall be based upon total uninterrupted service with
         the Company from the employee's date of hire.

B.       Classification seniority shall be the total time employed in Passenger
         and Fleet Service functions. Classification seniority shall govern all
         covered employees in their retention in case of a reduction in force,
         voluntary demotion, bidding rights for work schedules, choice of
         vacation periods, choice of and filling of vacancies and recall after
         release due to reduction in force.

C.       Employees with the same hire date will be placed on the seniority lists
         according to the last four digits of their social security number
         reading from left to right (the employee with the higher number will be
         placed on the list first.).

D.       An employee who is accepted for transfer within the Company outside the
         scope of this Agreement shall retain but not accrue seniority as above
         in Article 10 B. for up to six (6) months. After six (6) months, the
         employee shall be removed from the seniority list and lose all rights
         to return to the covered class.

E.       A classification seniority roster reflecting the job title, Company and
         classification seniority dates and domicile of each employee shall be
         brought up to date as of June 1st and Dec 1st of each year and posted
         on each bulletin board at each location where there are individuals
         employed under this Agreement within thirty (30) days following such
         dates. In addition, the Company shall, on a monthly basis, make
         available to the Union a list of changes affecting this roster. A copy
         of the seniority list will be furnished to each Steward at each station
         and to the Union Business Agent.

F.       Employees who wish to protest any omission or error affecting their
         classification seniority shall follow the normal grievance procedure
         within thirty (30) days of posting of the erroneous information on the
         bulletin board in their domicile. It is the intent of this section to
         ensure each employee his rightful classification seniority accrual and
         position on the Company seniority roster.

G.       An employee covered by this Agreement shall lose his seniority status
         and his name shall be removed from the seniority lists under the
         following conditions:

         1.       He quits, resigns, or retires.

         2.       He is discharged for cause (after grievance procedure is
                  exhausted).

         3.       He does not return to duty from furlough within the time
                  limits.

         4.       Or as otherwise provided in this Agreement.

                                    Page 27
<PAGE>

                                   ARTICLE 11
                                    PROBATION

A.       An employee shall be on probation during the first ninety (90) days
         after the date of placement on the Company payroll.

B.       The provisions of Article 15.E. shall not be available to probationary
         employees, and no grievance related to discipline or discharge may be
         filed by them or on their behalf. However, a probationary employee may
         file non-disciplinary grievances in accordance with Articles 15.A.-F.

C.       The Company has no responsibility to re-employ any employee separated
         during his probationary period.

D.       If an employee's service is broken during his probationary period as a
         result of an involuntary action (i.e., reduction in force) and the
         employee is recalled within a period of twenty-four (24) months, the
         employee's seniority date will be adjusted to reflect credit for all
         past service. An employee will not accrue benefits such as sick or
         occupational injury leave, or vacation, or holidays, etc., during any
         period of separation.

E.       The Company may terminate any employee during their probationary period
         with or without cause at the Company's sole discretion. The Company
         shall not be required to inform the employee or the Union of the reason
         for the probationary employee's termination.

                                    Page 28
<PAGE>

                                   ARTICLE 12
                              FILLING OF VACANCIES

A.       Permanent Vacancies

         1.       A permanent vacancy is one where the Company determines there
                  is an open position in a covered function with an expected
                  duration of at least one hundred twenty (120) calendar days or
                  more, and where the total complement of covered employees does
                  not change, and where a shifting of employees from one covered
                  duty assignment to another, or from one position to another
                  position is required, or as per paragraph 12.A.5.e., below.
                  There is no vacancy deemed to exist for system bidding
                  purposes when any of the above events occur.

         2.       When the Company fills a vacancy at any covered station, it
                  will be filled by the Vice President-Customer Service, or his
                  designee, from the results of a system bid. The senior
                  employee qualified to fill the vacancy with a bid on file will
                  be awarded the job.

         3.       Bids for a change of location or from part-time to full-time
                  shall be submitted in writing to the Vice President-Customer
                  Service, or his designee, with copies to the Manager of the
                  location desired and a copy to the Steward. Bids shall be
                  acknowledged by the Vice President-Customer Service, or his
                  designee.

         4.       Each station shall have at least one Lead Agent or a
                  Supervisor. At stations with more than twenty (20) covered
                  employees, a ratio of one (1) Lead Agent for each fifteen (15)
                  covered employees regularly assigned to that station shall be
                  maintained. Lead agents shall be chosen from among those
                  full-time employees expressing a desire for the position and
                  shall be awarded to the most senior qualified employee at the
                  location as determined by the Company.

         5.       Miscellaneous

                  a.       All vacancies will be posted in US Airways SABRE
                           reservations system. Bids must be received by the
                           Vice-President of Customer Service, or his designee,
                           prior to the bid closing date as posted in the US
                           Airways SABRE reservations system.

                  b.       An employee may withdraw any bid he has filed by
                           submitting to the Vice-President of Customer Service,
                           or his designee, and the Union a written withdrawal
                           forty-eight (48) hours prior to the bid closing date.

                  c.       An employee whose bid is awarded and who accepts the
                           bid will not be eligible to bid another
                           vacancy/position for six (6) months, except employees
                           will not be precluded from accepting promotions into
                           the higher classification of Lead Agent.

                  d.       An employee whose bid is awarded shall be notified
                           promptly. All bid awards will be posted in US Airways
                           SABRE reservations system. The employee shall be
                           available immediately after such notification except
                           where such award requires a transfer to another
                           covered station, in which case the employee may
                           request his

                                    Page 29
<PAGE>

                           supervisor to exchange his regular days off to those
                           consistent with his reporting date at the new
                           station. Employees will be granted up to ten (10)
                           days without pay to effect their move to the new
                           station.

                  e.       Prior to considering any bid for a vacancy, all
                           furloughed, covered employees at the location where
                           the vacancy exists shall be recalled, then any
                           furloughed covered employees at other locations will
                           be given an opportunity to fill the opening, before
                           hiring a new employee to fill the vacancy.

                  f.       Probationary employees are ineligible to bid under
                           this Article, except those probationary employees can
                           have a request on file and will receive consideration
                           before new hires.

B.       Temporary Vacancies

         1.       A temporary vacancy is where the Company determines there is
                  an open position in a covered function at a covered station
                  with an expected duration of one hundred and twenty (120)
                  calendar days or less to cover personal leaves of absence,
                  maternity leaves, military leaves, etc.

         2.       Temporary vacancies may be extended to a maximum of one
                  hundred eighty (180) calendar days (the original one hundred
                  twenty (120) and up to an additional sixty (60), if necessary)
                  where the specific leave requirements necessitate.

         3.       Temporary vacancies will be filled by giving an option to
                  furloughed covered employees at the location where the vacancy
                  exists in order of seniority to fill the vacancy, then to
                  furloughed, covered employees at any covered location.

         4.       If there are no employees on furlough, then the temporary
                  position will be filled as followed:

                  a.       When temporary full-time positions become available,
                           they will be offered to the most senior part-time
                           agent with a request on file.

                  b.       Any subsequent temporary full-time position that
                           becomes available at a covered location will be
                           offered to the most senior part-time agent with a bid
                           on file, whether he is presently working as a
                           part-time agent or is in another temporary full-time
                           position at that location.

                  c.       If it is necessary to eliminate a temporary full-time
                           position, the junior part-time agent covering a
                           temporary full-time position will be reduced to his
                           former part-time status.

                  d.       If there is no qualified covered part-time employee
                           willing to accept the available temporary full-time
                           position, the Company may assign the most junior
                           covered employee at the location or hire a new
                           employee.

                                    Page 30
<PAGE>

         5.       Temporary full-time employees will accrue seniority at the
                  regular full-time rate.

         6.       An employee who is awarded a temporary vacancy shall receive
                  lodging and a meal allowance in accordance with Article
                  14.A.3.

                                    Page 31
<PAGE>

                                   ARTICLE 13
                               REDUCTION IN FORCE

A.       A reduction in force shall be in the reverse order of classification
         seniority at the location. An employee who has completed his
         probationary period and who is notified he is affected by the reduction
         in force, at his option, may make one of the following choices:

         1.       Exercise his seniority to accept a transfer to a vacancy at
                  any covered station.

         2.       Exercise his seniority to "bump" the least senior employee on
                  the system.

         3.       Accept furlough at his domicile.

B.       Furloughed employees will be offered re-employment in the order of
         their classification seniority at their domicile. Vacancies shall not
         exist at a location until all employees eligible to fill the vacancy at
         the location (those on furlough or those transferred due to exercising
         the above option) have been recalled and offered employment and then as
         per Article 12.A.5.e. An employee who transferred to another station
         from his original station or was furloughed shall retain the rights to
         recall to his previous station for a period of eighteen (18) months.

C.       Expiration of Recall Rights

         1.       An employee furloughed due to a reduction in force shall
                  continue to accrue Company seniority and Classification
                  seniority, but not benefits, for the greater of five (5) years
                  from the date of furlough or a period equal to their
                  classification seniority accrued up to the time of furlough.

         2.       If the employee is not recalled within the time specified in
                  Article 13.C.1., above, employment and seniority rights will
                  expire.

D.       An employee who has been released due to a reduction in force shall
         file his address in writing with the Director of Human Resources and
         shall, thereafter, promptly advise the Director of Human Resources, in
         writing, of any change in his address. The Company will send notice to
         the address of record via U. S. Postal Service, certified-return
         receipt requested. If the furloughed employee does not contact the
         Company within fourteen (14) days from the date of receipt of notice of
         recall, his name will be dropped from the seniority lists.

E.       An employee is entitled to preference in re-employment only if he
         conforms to the following conditions:

         1.       Comply with the provisions in Article 13.D., above.

         2.       Give written notice via personal service, telegram, or
                  certified mail, return receipt requested, of his intention to
                  return to the service of the Company within seven (7) calendar
                  days of receipt of such written certified notice from the
                  Company to return.

                                    Page 32
<PAGE>

         3.       Return on the specified date, which date shall not be less
                  than twenty (20) calendar days after notice to return is sent
                  by Certified Mail or telegram to the last address filed with
                  the Director of Human Resources.

         4.       If a furloughed employee does not return on the specified
                  return date, he will be removed from the seniority lists,
                  unless, by mutual agreement extenuating or mitigating
                  circumstances existed to extend the return date.

F.       Notice of Reduction in Force

         1.       The Company will give the employee two (2) weeks notice in
                  writing in the event of a reduction in force, or pay in lieu
                  thereof. However, such notice requirements shall be waived in
                  cases of an Act of God, strike involving a group of organized
                  employees on the carrier, or circumstances beyond the control
                  of the Company.

         2.       The Company will comply with the WARN Act where applicable.

                                    Page 33
<PAGE>

                                   ARTICLE 14
                                    EXPENSES

A.       Expense Allowance

         The Company will pay certain reasonable expenses associated with the
following:

         1.       New Employee Training

                  New employees may be required to undergo formal training. A
                  new employee will be placed on the payroll from the first day
                  of training. If this training is conducted in a city other
                  than where the employee will be based, the Company will
                  arrange and pay for lodging at designated hotels and provide a
                  meal allowance. No expenses will be paid by the Company if the
                  training is conducted in the city where the employee will be
                  based.

         2.       Follow-up or Recurrent Training

                  Employees required to undergo training in a city other than
                  where they are based will be provided with lodging and a meal
                  allowance in accordance with paragraph B.1., below.

         3.       Temporary Assignment away from Base City

                  The Company will arrange and pay for reasonable expenses for
                  employees who are temporarily assigned to a city away from
                  their base. This may include lodging, meal allowance, and,
                  local transportation, depending on circumstances.

         4.       Company Business Travel

                  The Company will pay employees a meal allowance and
                  travel-related expenses when they are required to travel for
                  Company business. These expenses may include lodging,
                  business-related phone calls, and local transportation.

B.       Any allowed expenses will conform to the following guidelines.

         1.       Meal allowances - An employee will be paid a per diem up to
                  the current limits set by the Accounting Department which
                  currently are $5.00 for breakfast, $6.00 for lunch, and $11.00
                  for dinner, until the limits are changed by the Accounting
                  Department.

         2.       Lodging - The Company designates which hotels must be used in
                  each city.

         3.       Rental Cars - The Company shall determine when a rental car is
                  to be used and what company the car shall be rented from.

         4.       Use of Personal Vehicle - Approval must be obtained from the
                  Vice President of Customer Service, or his designee, and
                  reimbursement will be at the current rate set by the
                  Accounting Department. Currently, the rate is $.31 per mile,
                  until the rate is changed by the Accounting Department.

                                    Page 34
<PAGE>

         5.       Telephone Calls - Business-related telephone calls to an
                  employee's supervisor, operations, headquarters, etc., should
                  be made collect only if a Dialnet line is not available.

         6.       An employee will be reimbursed for the cost of one (1) long
                  distance telephone call home per day. This allowance, set by
                  the Accounting Department, is currently three dollars ($3.00)
                  per day.

C.       Reimbursement for approved expenses is accomplished by use of the
         Chautauqua Airlines "Expense Report" forms with all required receipts
         attached. Expense advances can be obtained through the Accounting
         Office by completing an "Accommodation Request Form." Reconciliation of
         expense advances is accomplished by use of the "Expense Report" form.

D.       "Accommodation Request" and "Expense Report" forms must be approved by
         a Manager prior to being submitted to the Accounting Office. Expense
         reports and reconciliation of expense advances must be submitted to the
         department manager within seven (7) working days after the last expense
         incurred or the advance received may be considered a loan and may be
         deducted from the next pay check. A waiver by the Company of the seven
         (7) day requirement will not prejudice the Company's right to require
         compliance with a seven (7) day limit.

                                    Page 35
<PAGE>

                                   ARTICLE 15
                              GRIEVANCE PROCEDURES

A.       Grievance

         A grievance is a claim or dispute by a covered employee or the Union
         concerning the interpretation, application, or the alleged breach of
         this Agreement. Any covered employee or group of covered employees who
         has a grievance concerning any action of the Company affecting them
         shall have such grievance considered and handled in accordance with the
         following procedures. It is the intent of the parties to resolve
         grievances or potential grievances informally and at the lowest level
         possible. There shall be an earnest effort on the part of the parties
         to settle grievances promptly and in accordance with the procedures
         outlined herein.

B.       Step One - Informal Discussion With a Supervisor

         1.       An employee or Union representative who believes that his
                  rights under this Agreement have been violated should first
                  bring the matter to the attention of the employee's immediate
                  supervisor.

         2.       The immediate supervisor, or his designee, must reply to the
                  employee within five (5) business days.

         3.       Disciplinary grievances shall be initiated at Step Two, below.

C.       Step Two - Written Grievance

         1.       After receipt of an unsatisfactory response, or lapse of the
                  five (5) business days in Step One, the employee or the Union
                  shall reduce the grievance to writing and submit it to the
                  Vice President-Customer Service, or his designee, within
                  thirty (30) days of the event giving rise to the grievance, or
                  when the grievant should have reasonably known of the event.

         2.       The written grievance shall set forth, with reasonable detail,
                  a statement of the facts giving rise to the grievance, the
                  provision of the Agreement alleged to have been breached and
                  the relief sought. The Vice President-Customer Service, or his
                  designee, shall hold a hearing within fifteen (15) business
                  days of receipt of the written grievance by the Company. The
                  grievant shall, if requested by the Company or the Union,
                  attend such hearing.

         3.       The Vice President-Customer Service, or his designee, shall,
                  within ten (10) business days of said hearing, provide the
                  Union Business Representative, or his designee, with a written
                  statement of his decision.

D.       Step Three

         If the Union is not satisfied with the disposition of the grievance in
         the Step Two proceeding above, it may appeal the case to the System
         Board of Adjustment by submitting a written

                                    Page 36
<PAGE>

         submission of the case to the System Board, with a copy to the Vice
         President-Customer Service within fifteen (15) business days after
         receiving the Step Two decision.

E.       Discipline or Discharge.

         1.       No employee shall be subject to discipline or discharge
                  without just cause. An employee shall be notified in writing
                  of discharge, disciplinary time off and written reprimand. The
                  Company will send a copy of such notice to the employee and to
                  the Union. An employee so disciplined or discharged may submit
                  a written grievance directly at the Step Two level, above.
                  Such written grievance must be filed within ten (10) business
                  days of the postmark (on the Union's copy) of the written
                  discipline or discharge action by the Company.

         2.       Employees who are a party to incidents involving discipline or
                  discharge shall be retained on the payroll but may be removed
                  from service until a meeting has been held and a decision
                  arrived at in writing by the Company. Teleconferencing may be
                  utilized and the grievant, a Company representative and a
                  Union representative and others as desired may be present.
                  Following the Company decision, the grievant may be suspended
                  from the payroll, discharged or given other disciplinary
                  actions.

         3.       The provisions of Article 15.D. shall not be available to
                  probationary employees and no grievance related to discipline
                  or discharge may be filed by them or on their behalf. However,
                  a probationary employee may file non-disciplinary grievances
                  in accordance with Articles 15.A-D.

F.       General

         1.       Time limits contained in this Article may be extended by
                  mutual agreement of the parties, reduced to writing.

         2.       Failure on the part of the Company, the grievant or the Union
                  to adhere to the time limits set forth herein, or as mutually
                  agreed to, shall constitute a waiver of the position of the
                  party failing to comply.

         3.       If a grievant is exonerated, her personnel file shall, to the
                  extent permitted by law, be cleared of all reference to the
                  incident. A grievant who is cleared of all charges shall be
                  made whole as pertains to wages, seniority, longevity and
                  benefits.

         4.       Grievances, decisions, and appeals shall be forwarded by
                  personal delivery or through the U.S. Mail, certified, postage
                  prepaid, return receipt requested, addressed to the last known
                  address of the grievant, with a copy to the Union. Refusal to
                  accept delivery constitutes delivery.

         5.       An employee shall have the right of Union representation at
                  all meetings with the Company. An employee shall be advised in
                  advance of the nature of the subject of any investigation,
                  hearing or conference that would not be compromised and/or
                  made ineffective if advance notice was given to the employee
                  and/or the Union.

                                    Page 37
<PAGE>

         6.       The Union, or its representative, and the grievant shall have
                  access to the grievant's personnel file for review in any
                  discipline or discharge case. The Company shall cooperate in
                  making any reasonably requested material available that is
                  relevant to the case.

         7.       When it is mutually agreed that a stenographic report is to be
                  taken of the hearing, in whole or in part, the cost will be
                  borne equally by both parties to the dispute. If it is not
                  mutually agreed that a stenographic report be taken, any
                  stenographic report taken of such hearing made by either of
                  the parties shall be furnished to the other party, upon
                  request, provided that the cost of such stenographic report so
                  requested shall be borne equally by both parties.

                                    Page 38
<PAGE>

                                   ARTICLE 16
                           SYSTEM BOARD OF ADJUSTMENT

A.       In compliance with Section 204, Title II, of the Railway Labor Act, as
         amended, there is hereby established a System Board of Adjustment for
         the purpose of adjusting and deciding disputes that may arise under the
         terms of this Agreement and any amendment or additions thereto and that
         are properly submitted to it, which Board shall be known as the
         Chautauqua Employees System Board of Adjustment, hereinafter referred
         to as "the Board."

B.       Composition of the Board

         1.       The Board shall consist of four (4) members, two (2) of whom
                  shall be selected and appointed by the Company and two (2) of
                  whom shall be selected and appointed by the Union, and such
                  appointees shall be known as the "Board Members." In addition,
                  the Company and the Union shall each designate an alternate,
                  and in the event of unavailability of a Board Member, such
                  alternate shall serve in place of the absent Board Member.

         2.       The two (2) Board Members appointed by the Company and the two
                  (2) Board Members appointed by the Union, and their
                  alternates, shall serve for one (1) year from the date of
                  their appointment and thereafter until their successors have
                  been duly appointed. Vacancies shall be filled within thirty
                  (30) days in the same manner as is provided herein for the
                  selection and appointment of the original Board Members and
                  the original alternates.

         3.       The terms of the office of Chairman and Vice Chairman shall be
                  for one (1) calendar year. Thereafter, from year to year, the
                  Board shall designate one (1) member to act as Chairman and
                  one (1) member to act as Vice Chairman for one (1) year terms.
                  Such term of office shall commence on January 1st of each
                  year.

         4.       The office of Chairman shall be filled alternately by the
                  parties. A Union representative shall serve as Chairman and a
                  Company representative shall serve as Vice Chairman in even
                  years, and vice versa, in odd years.

         5.       The Board shall meet once every three (3) months at Company
                  headquarters, (unless a different place for the meeting is
                  jointly agreed upon by the Board), during the months of
                  January, April, July, and October of each year provided that
                  at such time there are cases filed with the Board for
                  consideration. The meetings shall continue in session until
                  all matters before it have been considered unless otherwise
                  mutually agreed upon in writing.

         6.       Meetings shall be scheduled so that Members of the Board who
                  are employees of the Company shall suffer no loss of pay while
                  attending Board meetings. Each party shall bear the cost of
                  compensation and expenses of its Board Members

C.       Jurisdiction of the Board

         1.       The Board shall have jurisdiction over all disputes growing
                  out of

                                    Page 39
<PAGE>

                  grievances or out of interpretation or application of any
                  terms of this Agreement or amendments thereto submitted by the
                  Union to the Vice President-Customer Service, or his designee.
                  The jurisdiction of the Board shall not extend to proposed
                  changes in hours of employment, rates of compensation, or
                  working conditions covered by this or other existing
                  agreements between the parties hereto.

         2.       The Board shall consider any dispute properly submitted to it
                  when such dispute has not been previously settled in
                  accordance with the provisions of Article 15.

D.       Proceeding before the Board

         1.       All disputes properly referred to the Board for consideration
                  shall be addressed to the Chairman. Five (5) copies of each
                  petition, including all papers and exhibits in connection
                  therewith, shall be forwarded to the Chairman, who shall
                  transmit one (1) copy thereof to each member of the Board
                  within three (3) calendar days of his receipt of same. Each
                  case submitted shall show:

                  a.       Question or questions at issue
                  b.       Statement of facts
                  c.       Position of the grievant(s)
                  d.       Position of the Company

         2.       Upon receipt of notice of the submission of a dispute, the
                  Chairman shall set a date for the hearing, which shall be the
                  time of the next regular meeting of the Board as provided in
                  Section B., above, or if at least two (2) Board Members
                  consider the matter to be of sufficient urgency and
                  importance, then at such earlier date and at such place as the
                  Chairman and Vice Chairman shall agree upon but not more then
                  thirty (30) days after such request for a meeting is made by
                  at least two (2) of said Board Members; the Chairman shall
                  give the necessary notices in writing of such meeting to the
                  Board Members and to the parties to the dispute.

         3.       Employees covered by this Agreement may be represented at
                  Board hearings by such person or persons as they may choose
                  and designate, and the Company may be represented by such
                  person or persons as it may choose to designate. Evidence may
                  be presented either orally, or in writing, or both.

         4.       The Board Member(s) may summon witnesses who are employed by
                  the Company and who are deemed necessary by the Board. Such
                  employees shall be scheduled so as to suffer no loss of pay.

         5.       The Board shall be competent to hear the disputes properly
                  submitted to it and decide said disputes by a majority vote of
                  all members of the Board. Decisions of the Board shall be
                  final and binding upon the parties hereto. The Board may, at
                  its option, agree to have an arbitrator hear the case without
                  the Board present.

                                    Page 40
<PAGE>

E.       Deadlock Procedures

         When a dispute is properly submitted to the Board for hearings before
         the two (2) Company and the two (2) Union Board Members, or their
         alternates, and the Board is unable by majority vote to decide the
         dispute, the Board shall declare itself deadlocked and the parties
         shall select an arbitrator as provided herein. The arbitrator shall
         join the Board as a Board Member and as Chairman in subsequent
         consideration and hearing of the dispute. The Board, so composed, shall
         be competent to decide said dispute by majority vote. Decisions of the
         Board so composed shall be final and binding on the parties. The Board
         may agree to have the arbitrator hear the case without the Board
         present.

F.       Deadlock Notices

         When a deadlock occurs for any reason, the Board, by written notice
         shall immediately notify the Union and Company of such deadlock,
         including the date thereof, and the need for the services of a fifth
         (5th) member of the Board. If the Union or Company desires to submit
         the case to such five (5) member Board, it must do so by written notice
         to the Company president with copies to the Chairman and Vice Chairman
         of the Board within ten (10) calendar days from the receipt of notice
         from the Board that the Board was deadlocked.

G.       Selection of a Fifth (5th) Board Member (Arbitrator)

         1.       If notice is provided of the desire to convene the five (5)
                  member Board, the Union and the Company shall meet promptly,
                  but in no event later than five (5) calendar days from the
                  date of such notice by the Union or Company, to select an
                  arbitrator by mutual agreement, and if agreement is reached,
                  shall advise the members of the Board of the name, address,
                  and the availability of the arbitrator.

         2.       Within ten (10) calendar days after proper notification, if no
                  agreement on the selection of an arbitrator can be reached,
                  the Company and the Union shall agree upon the selection of an
                  arbitrator from the list below. If the parties are unable to
                  agree upon an arbitrator from the list below, the parties will
                  select an arbitrator from the list below using an alternate
                  strike method. In even years, the union will strike first; in
                  odd years, the Company will strike first. If it becomes
                  necessary to replace an arbitrator on the list below, the
                  parties shall mutually agree upon such replacement before
                  selecting any arbitrator from the list. Such replacements
                  shall be members of the National Academy of Arbitrators and
                  shall have airline case experience. Once each year, the Union
                  and the Company will each have the option to remove one
                  arbitrator from the list below. Such arbitrator shall be
                  replaced in accordance with the provisions of this paragraph
                  for replacing arbitrators.

                             Richard I. Bloch
                             Herbert Fishgold
                             Robert O. Harris
                             Peter R. Meyers
                             George Nicolau
                             Anthony Sinicropi
                             William L. Schecter

                                    Page 41
<PAGE>

                             Barbara Zausner-Tener
                             Nicolas H. Zumas

H.       Five (5) Member Board Hearing

         Within thirty (30) calendar days after the selection of the fifth (5th)
         member from the panel, and with the arbitrator's concurrence, the Board
         shall schedule a hearing of the dispute by the five (5) member Board,
         including the presentation of such witnesses and evidence as the five
         (5) member Board shall in its discretion permit. A decision of a
         majority of the Board sitting with the fifth (5th) member shall be
         final and binding upon the parties thereto. The Board may agree to have
         the arbitrator hear the case without the Board present.

I.       General

         1.       Expenses of the Board

                  Each of the parties hereto will assume the travel expenses and
                  other expenses of the Board Members selected by it, and each
                  of the parties hereto will assume the travel expense and other
                  expenses of the witnesses called or summoned by it except that
                  employees of the Company will be scheduled so not to suffer
                  loss of pay and that the Company will provide space available
                  transportation over its lines, in accordance with existing
                  regulations, for any Board Member or Company employee who is
                  called or summoned as a witness. The reasonable expense and
                  compensation of the fifth (5th) member arbitrator appointed in
                  accordance with Section G hereof will be borne equally by the
                  parties hereto. The Chairman and the Vice Chairman, acting
                  jointly, shall have the authority to incur other expenses as
                  in their judgment may be deemed necessary for the proper
                  conduct of the Board, and such expenses shall be borne equally
                  by the parties hereto.

         2.       Freedom to Act

                  Each Board Member shall be free to discharge his duty in an
                  independent and un-coerced manner, without fear that his
                  individual relations with the Company, with the employees, or
                  with the Union will be affected in any manner by any action
                  taken by him in good faith in his capacity as a Board Member.

         3.       Time Limits

                  Time limits as set forth in this Article may be extended in
                  writing by mutual agreement of the Company and the Union.

         4.       Rights Under Railway Labor Act

                  Nothing herein shall be construed to limit, restrict, or
                  abridge the rights or privileges accorded either to the
                  employees, the Company, the Union or their duly accredited
                  representatives under the provisions of the Railway Labor Act,
                  as amended.

                                    Page 42
<PAGE>

         5.       Records of the Board

                  The Board shall maintain a record of all matters submitted to
                  it for its consideration and of all findings and decisions
                  made by it.

         6.       When it is mutually agreed that a stenographic report is to be
                  taken of the hearing, in whole or in part, the cost will be
                  borne equally by both parties to the dispute. If it is not
                  mutually agreed that a stenographic report be taken, any
                  stenographic report taken of such hearing made by either of
                  the parties shall be furnished to the other party, upon
                  request, provided that the cost of such stenographic report so
                  requested shall be borne equally by both parties.

                                    Page 43
<PAGE>

                                   ARTICLE 17
                              PHYSICAL EXAMINATIONS

A.       An employee shall be required to submit to a Company paid
         physical/mental examination at the time of employment and at any other
         time the Company shall determine in its sole discretion that an
         employee's physical or mental condition may or has impaired the
         performance of his duties or poses a safety hazard to himself, other
         employees, or customers. The employee, can request, and will be
         furnished with, a copy of his medical examiner's report from the
         Company's medical examiner. These examinations are limited to no more
         than two (2) examinations per calendar year.

B.       Any information obtained by or as a result of a Company's
         physical/mental examination of an employee shall be strictly
         confidential between the Company, its insurance carriers, the FAA, the
         Company doctor, and the employee, and shall not be divulged to any
         other person without the written permission of the employee.

C.       Any employee who is dismissed or has his pay scale lowered based on his
         failure to pass a Company physical/mental examination shall have
         fourteen (14) days in which to appeal for lost wages, and shall at his
         option, have his case reviewed in the following manner.

         1.       The employee may employ a qualified medical examiner of his
                  own choosing and at his own expense for the purpose of
                  conducting a physical/mental examination covering the
                  disqualifying problem(s) and/or conditions covered by the
                  Company medical examiner's report that found the employee
                  unfit for duty.

         2.       A copy of the findings of the medical examiner chosen by the
                  employee shall be furnished to the Company; and if such
                  findings corroborate the findings of the medical examiner
                  employed by the Company, no further review of the case shall
                  be afforded.

         3.       If the findings of the medical examiner chosen by the employee
                  disagree with the findings of the medical examiner employed by
                  the Company, the Company and the employee will, at the written
                  request of the employee, ask that the two (2) medical
                  examiners agree upon and appoint a third qualified and
                  disinterested medical examiner, preferably a specialist, for
                  the purpose of making a further review of the report and/or an
                  examination of the employee to determine his fitness for duty.

         4.       The said disinterested medical examiner shall then make a
                  further examination of the employee in question, and the case
                  shall be decided on the basis of the third medical examiner's
                  findings. If the disinterested medical examiner's report finds
                  the employee fit for duty, all lost wages will be paid,
                  retroactive to the date the employee was removed from payroll.
                  Copies of such medical examiner's report shall be furnished to
                  the Company and the employee.

         5.       The expense of employing a disinterested medical examiner
                  shall be borne equally by the Company and the employee.

                                    Page 44
<PAGE>

D.       Drug and alcohol screening will not be considered a physical/mental
         examination under this Article. Employees must submit to Drug and
         Alcohol testing to conform with the DOT/FAA and the Company's present
         or future policies.

                                    Page 45
<PAGE>

                                   ARTICLE 18
                               ORDERS TO EMPLOYEES

A.       All orders to employees involving a change in stations, promotions,
         demotions, furloughs, leaves of absence, etc, shall be delivered to the
         employee in writing by personal service on and receipt by the employee,
         or by certified mail, return receipt requested, to the employee's last
         address on file.

                                    Page 46
<PAGE>

                                   ARTICLE 19
                                    TRAINING

A.       No employee shall be required to pay for the use of any Company
         equipment or equipment outside of the Company that is provided as part
         of a Company training requirement. Any training required of an employee
         for maintenance or improvements in proficiency standards shall be borne
         by the Company. No employee shall be required to pay a fine or be
         responsible for the repair or replacement of any part of equipment
         damaged except for willful damage or destruction to the equipment.

B.       Training time shall be considered as time worked, and the applicable
         rate shall be paid.

C.       Travel time in connection with training shall be considered as time
         worked.

                                    Page 47
<PAGE>
\
                                   ARTICLE 20
                                 MOVING EXPENSES

A.       Employees who have completed their probationary period and who are
         transferred as a result of the closing of an existing station will be
         considered as being transferred at the Company's request.

B.       An employee transferred from one station to another station as a result
         of a voluntary bid or request to fill a vacancy shall be considered as
         having transferred at his own request. Employees having transferred
         from one station to another station at their own request shall bear the
         expense of their move.

C.       Moving expenses incurred when moving at the Company's request are paid
         by the Company and are limited to the following expenses:

         1.       The Company has the right to request the employee to obtain
                  estimates for moving himself, and an estimate using
                  professional movers. The Company may choose the lower
                  estimate. When the employee moves himself, the Company will
                  pay for all shipping, containers, insurance for the move, and
                  one hundred dollars ($100.00) (to offset the cost of moving
                  helpers).

         2.       The Company will pay for the hook-up of all utilities
                  (excluding deposits) including, but not limited to: gas,
                  electric utilities, telephone and cable television, that
                  result from a move to a new domicile, provided it does not
                  involve alterations or materials.

         3.       When personal automobile transportation is used by the
                  employee and his immediate family, the Company will reimburse
                  the employee at the prevailing Company rate per mile. Single
                  employees shall have one (1) automobile covered, married
                  employees up to two (2) vehicles, using the most direct AAA
                  mileage between domiciles.

         4.       The Company will reimburse an employee for meals and lodging
                  for the employee and his immediate family, for the time
                  required to travel to the station up to five (5) days. A day
                  of travel shall be considered a minimum of three hundred fifty
                  (350) miles by the most direct AAA mileage. The daily
                  allowance for meals will be twenty-two dollars ($22.00) per
                  day for single employees and forty-four dollars ($44.00) per
                  day for married employees traveling with their spouse.

         5.       If a lease is broken as a result of moving to a new domicile
                  and a penalty is incurred, the Company will pay the penalty
                  not to exceed one month's rent. The Company will cooperate
                  with the employee to provide substantiating documentation of
                  the transfer for the lessor.

         6.       The Company will pay up to two hundred dollars ($200.00) for
                  termination and hook-up of utilities (excluding deposits)
                  including gas, electric utilities, telephone and cable
                  television, that result from a move to a new domicile.

                                    Page 48
<PAGE>

D.       When the Company is required to pay moving expenses, nothing in this
         Article is intended to prevent the Company and the employee from
         agreeing to an amount to be paid to the employee in lieu of the
         expenses set forth in paragraph C., above.

E.       The Company's liability for moving expenses under this Article will not
         exceed five thousand dollars ($5,000).

                                    Page 49
<PAGE>

                                   ARTICLE 21
                                 UNION SECURITY

A.       Union Membership

         It shall be a condition of employment that all employees covered by
         this Agreement shall, on the effective date of this Agreement, become
         and remain members in good standing of the Union. It shall be a
         condition of employment that all employees covered by this Agreement
         and hired on or after its effective date shall, on or before the
         ninetieth (90th) day following the beginning of the initial seniority
         date, become and remain members in good standing in the Union.

B.       Initiation Fees and Dues Deductions

         The Company will deduct from the wages of any employees covered by this
         Agreement said employees' dues as a member of the Union upon receiving
         the employee's voluntary and individual written authorization for the
         Company to make such deductions, signed by the employee. Such
         authorization form will be provided by the Union. The Company will pay
         over to the proper officers of the Union the wages withheld for such
         initiation fees and/or dues. The amount so withheld shall be deducted
         from the appropriate paycheck, reported and paid to the Union monthly.
         The following information will be reported and transmitted with the
         monthly check off: the employee's Social Security number, full name,
         dues rate, rate of pay and status of employment.

C.       Indemnification Clause

         The Union shall indemnify the Company and hold the Company harmless
         from any and all claims that may be made by an employee against the
         Company by virtue of the wrongful application or misapplication of any
         of the terms of this Article.

D.       Dues Collection after Termination

         In the event of termination of employment, there shall be no obligation
         upon the Company to collect dues until all other deductions have been
         made.

E.       Failure to Pay Dues

         The Union agrees that written notice shall be given to the Company at
         least thirty (30) days before the Company is required to remove an
         employee from his employment by reason of his failure to maintain his
         membership in good standing in the Union in accordance with Article A.,
         above.

F.       Employee List

         1.       When applicable, the Company will advise the Union of the
                  names of any new hires, terminations, layoffs or recall of any
                  employees covered by this Agreement. Such

                                    Page 50
<PAGE>

                  information will include the name, hire date, layoff date,
                  termination date or recall date of such employees.

         2.       The Company will mail to the Union and a designee a report,
                  containing the current address, telephone number and pay rate
                  of each employee quarterly or when there are substantial
                  changes.

G.       Individual Dues Payment

         It shall be the responsibility of any employee who is not on a dues
         deduction program to keep his membership current by direct payments of
         monthly dues to the Union.

H.       Dues Deduction Error

         Should a deduction be missed, or in the event an insufficient amount is
         deducted, the Company will be responsible to make the proper adjustment
         the following month.

I.       Hospitality Committee

         The Company shall set aside a mutually agreeable period of time during
         or immediately after each new hire class during which the Union
         Hospitality Committee may meet with each new hire class. The Company
         and the Union will mutually agree upon those committee representatives
         who will present Hospitality Committee materials during the new hire
         class.

                                    Page 51
<PAGE>

                                   ARTICLE 22
                                  SEVERANCE PAY

In the event of a reduction in force or when the Company decides to close a
station, full-time employees at that station with at least one (1) year of
service as a full-time employee, who are ineligible or decide not to transfer to
another station will receive eighty (80) hours of severance pay, (at the
employee's current hourly rate). Part-time employees with at least one (1) year
of service will receive forty (40) hours of severance pay. In addition to the
eighty (80), or forty (40) hours respectively, they shall receive additional
hours according to schedule `A' below.

A.       Years of Service          Number of Hours for Each Year of Service
         ----------------          ----------------------------------------

         For Years 1-10                     Eight (8) Hours

         For Years 11-15                    Sixteen (16) Hours

         For Years 15 +                     Twenty Four (24) Hours

                                    Page 52
<PAGE>

                                   ARTICLE 23
                               HEALTH AND WELFARE

A.       The Company shall provide each full-time employee with a life insurance
         policy after ninety (90) days of service. The Company shall pay one
         hundred percent (100%) of the premium for this coverage.

         1.       Life Insurance coverage is two (2) times the basic annual
                  earnings, rounded to the next higher $1000, to a maximum of
                  $250,000.

         2.       Accidental Death and Dismemberment coverage is two (2) times
                  the basic annual earnings, rounded to the next higher $1000,
                  to a maximum of $250,000.

         3.       Dependent Life Benefits;

                  a. Spouse                                      $5,000

                  b. Children          0-8 days                  $0
                                       8 days-6 months           $100
                                       6 months-19 years         $2,500

B.       The Company will provide Health Insurance for all full-time employees
         and qualifying dependents after thirty (30) days of service, the
         benefits of which shall not be less advantageous than the existing
         program coverage and benefits. For employees with under one (1) year of
         service, the Company shall pay the premium cost less $13.80 per pay
         period to be paid by the employee. Optional dependent coverage is not
         available during the first year. For employees with over one (1) year
         of service, the Company will pay the premium cost, less $13.80 for
         individual employee coverage, or $23.00 for employee and spouse
         coverage, or $32.20 for employee and family coverage, per pay period
         for said employee and his dependents. The employee will pay his share
         of the premium through payroll deductions. Should the cost of such
         insurance increase, the Company may require greater contributions from
         the employees.

C.       The Company will provide the Business Agent and the Union with copies
         of the Master Insurance Contracts for each policy required under the
         terms of this Agreement.

D.       The Company will provide an IRS Section 125 Flexible Benefits Plan to
         all covered employees, the benefits of which plan shall not be less
         advantageous than the existing program .

E.       The Company shall provide a retirement benefit in the form of an IRS
         Section 401k plan to all covered employees, and the benefits shall be
         no less advantageous than the existing program.

F.       The Company shall pay for dental plan coverage for single covered
         employees or sixteen and one-half dollars ($16.50) per month towards
         the cost of family coverage. The plan for covered employees and
         qualified dependants will be no less advantageous than the program
         offered to other employee groups.

                                    Page 53
<PAGE>

G.       The Company will include the covered employees in any profit sharing
         plan, bonus and incentive programs offered to all other non-management
         employees.

                                    Page 54
<PAGE>

                                   ARTICLE 24
                                SAFETY AND HEALTH

A.       At each station, one (1) representative will be designated by the
         Company and one (1) representative will be designated by the Union to
         discuss, and if a problem or violation exists of a law or rule, to
         correct any practice that causes said violation in any safety or health
         factors that may directly affect the employees or the Company in their
         work areas.

B.       Accordingly, this joint Safety Committee at each station will meet
         periodically at the station to review any pending matters of safety or
         health.

C.       Safety and health items presented by either the Company or the Union
         member at these periodic meetings will be documented in writing, with a
         copy to the Vice President of Safety.

D.       Items not resolved at the station level will be presented to the Vice
         President of Safety for resolution by the Vice President of Customer
         Service and the designee of the Union.

E.       The Company and the Union will work toward a mutual resolution of any
         safety or health factor(s), and therefore, employees must register and
         attempt to resolve any complaints through the respective Safety
         Committee prior to filing a complaint with the local, state, or federal
         regulatory agency.

                                    Page 55
<PAGE>

                                   ARTICLE 25
                                     GENERAL

A.       Nothing in this Agreement shall be construed to limit or deny any
         employee of the Company covered by this Agreement any rights or
         privileges to which he may be entitled under the Railway Labor Act, as
         amended.

B.       The Company will provide, free of charge, to each employee one (1) copy
         of this Agreement and any letters of understanding applicable to them,
         supplemental to the Agreement, which shall be printed and bound in a
         convenient-sized booklet.

C.       The Company will provide a glass enclosed, lockable bulletin board at
         each station where covered employees work for the Union to post
         official Union notices. The bulletin board shall be located in a
         convenient, accessible area.

D.       The Company shall furnish an identification card to each employee.
         Employees shall bear the cost of replacement of the identification
         card, if lost.

E.       No employee or his estate shall be required to pay the cost of repair
         or replacement of any aircraft, equipment or property damaged or
         destroyed in the performance of his duties with the Company, unless
         caused by criminal and/or malicious and/or intentional mischief.

F.       Employees covered by this Agreement will be subject to the pass policy
         of USAirways (or such other pass policy as the employees of the Company
         generally may have access) and the Company as afforded to all other
         employees of the Company not covered by this Agreement. The designated
         Union Business Agent will be provided positive space travel on the
         Company system for the purpose of administering this Agreement. The
         Company, at its sole discretion, reserves the right to suspend or
         revoke the pass privileges for any employee who violates the pass
         policy rules.

G.       The Union Representative(s) shall have free access to the Company's
         operations facilities to transact business that is necessary for the
         administration of this Agreement, but at a time that does not interfere
         with the operation of the Company's business. The Company will provide
         the Union Representative with proper ID to enter its facilities, if
         required.

H.       This Agreement, when accepted by the parties hereto and signed by the
         respective representatives duly authorized, shall constitute the sole
         agreement between them involving the employees covered by this
         Agreement.

I.       The Company will provide free parking to all employees covered by this
         Agreement.

J.       A personnel file will be maintained for each employee. Upon request,
         the employee will be given the opportunity to review his file. If an
         employee receives disciplinary action, any portion of this file to be
         relied on by the Company in support of such disciplinary action shall
         be open for review upon request by the Union Representative and the
         employee. The Company cannot use any prior disciplinary notices in
         support of disciplinary action if the employee had not been provided
         with written notice of the prior disciplinary action at the time
         discipline was assessed,

                                    Page 56
<PAGE>

         which action was subject to the grievance procedure. All disciplinary
         action will be according to Company policies and procedures.
         Disciplinary letters pertaining to events that are closed and no longer
         pending will be removed twelve (12) months after being issued, provided
         that the employee has not had any intervening discipline events. Such
         letters will be removed after twenty-four (24) months even if there has
         been an intervening disciplinary event.

K.       Employees covered by this Agreement must have a local telephone contact
         and notify the Personnel Department with the telephone number or any
         changes.

L.       The Company will make every reasonable effort to protect employees from
         physical assault, theft, vandalism and the like in connection with
         their employment, within the confines of their work place. The Company
         is not responsible under any circumstances for the loss or theft of any
         money or valuables left on the Company's premises or in lockers by the
         employees.

M.       Two Weeks Notice - If an employee fails to give or fails to work his
         scheduled hours during the fourteen (14) calendar days after their
         notice to the Company of their resignation, they will forfeit accrued
         vacation.

N.       Employees conducting Union business or attending meetings at their
         domicile or at other domiciles shall not be required to clock-out for
         the time spent on such business or meetings, as long as it does not
         interfere with their regular duties, or the operation.

O.       If any provision of this Agreement is declared invalid by any competent
         court or government agency because of existing or future legislation,
         such invalidation shall not affect the remaining provisions of this
         Agreement.

P.       The Company will provide secure lockable lockers for each covered
         employee at each station.

                                    Page 57
<PAGE>

                                   ARTICLE 26
                               PART-TIME EMPLOYEES

All provisions of the Agreement shall apply to part-time employees, unless
otherwise noted in other Articles and with the following specific exceptions.

A.       Seniority

         1.       All part-time employees who were hired prior to April 26, 1996
                  will retain their current seniority and begin accruing
                  seniority in accordance with paragraph 26.A.2., below,
                  effective April 26, 1996. A single classification seniority
                  roster will be compiled from the date of hire for the purposes
                  of determining classification seniority for part-time
                  employees to be used to fill vacancies, retention in the case
                  of a reduction in force, bidding of shifts, bidding vacation,
                  etc.

         2.       Part-time employees shall accrue longevity and advance their
                  position within the longevity scale in the compensation
                  schedule in Article 3.A. in the amount equal to half of that
                  accrued by full-time employees, except that, employees who
                  work in excess of one thousand six hundred thirty-two (1632)
                  hours in the prior anniversary year will be progressed as if a
                  full-time employee.

B.       Vacation

         Vacation will accrue in accordance with Article 7, and will be based on
         the total number of hours worked in the prior year (i.e. employees who
         work less than one thousand six hundred thirty-two (1632) hours in the
         prior year will accrue vacation at the fifty percent (50%) rate, and
         employees who work one thousand six hundred thirty-two (1632) or more
         hours will accrue vacation at the full-time rate.)

C.       Sick Leave

         Sick leave will accrue in accordance with Article 7 and will be based
         on the total number of hours worked in the prior anniversary year (i.e.
         employees who work less than one thousand six hundred thirty two (1632)
         hours in the prior anniversary year will accrue vacation at the fifty
         percent (50%) rate, and employees who work one thousand six hundred
         thirty-two (1632) or more hours will accrue sick leave at the full-time
         rate.)

D.       Health and Life Insurance

         Part-time employees who work more than one thousand forty (1040) hours
         in an anniversary year shall accrue and be eligible for one half (1/2)
         the premium for Company-paid Life and Health (Medical/Dental) insurance
         of that of a full-time employee. Part-time employees who work in excess
         of one thousand six hundred thirty two (1632) hours in an anniversary
         year will be eligible to receive fully Company-paid Life and Health
         insurance benefits minus co-pay, equal to that of a full-time employee,
         for himself and his dependents. Part-time employees who do not qualify
         for fully paid Company benefits may elect to purchase Life and Health
         (Medical/Dental) Insurance for himself and his dependents at the same
         cost as the Company. If

                                    Page 58
<PAGE>

         the employee elects this coverage, the additional cost shall be paid by
         payroll deduction. The percentage amount of premium benefit paid by the
         Company is paid in the year following the anniversary year and shall be
         subject to re-qualification on each succeeding anniversary. If the
         employee is terminated for any reason, the employee shall not be
         entitled to payment of any accrued but unpaid benefits. There will be
         no Health and Life insurance benefits for employees who work less than
         1040 hours in an anniversary year.

E.       The Company will not regularly schedule part-time employees within
         the same work function back to back continuously in a work period. It
         is the purpose of this paragraph that two (2) part-time employees shall
         not be regularly scheduled continuously within the same duty function
         within the same work period.

F.       The Company may use part-time employees to ensure adequate coverage
         or to cover a schedule and to avoid creating the opportunity for
         necessity of having to pay overtime premium.

                                    Page 59
<PAGE>

                                   ARTICLE 27
                                    UNIFORMS

A.       An employee shall wear the standard uniform as required in Company
         regulations at all times when on duty.

B.       The uniform or its identifying insignia may not be worn at any
         function, meeting, or event not directly associated with, or sanctioned
         by, the Company unless specifically authorized by the Company.

C.       The employee will be responsible for the total cost of the basic
         uniform.

D.       The Company will provide each employee with one (1) name tag.

E.       The employee shall be permitted to wear the official Union insignia on
         a place visible on the employee's uniform, but not to exceed a one (1)
         inch diameter in size.

F.       Employees will maintain their uniforms so as to present a neat and
         clean appearance at all times while on duty. Each employee will be paid
         a uniform allowance of twenty (20) dollars per month.

G.       Special clothing and equipment will be provided by the Company to each
         station where duty functions require work in inclement weather on a
         regular basis. These include parka, rain gear (head covering, jacket,
         pants, boots), parking wands and ear protectors.

H.       If the Company initiates a complete change in the basic uniform style,
         employees will be provided with a new required uniform, at no expense
         to the employee.

I.       If any of an employee's uniform parts are damaged beyond repair by
         aircraft fluids, cargo, equipment, etc., the Company will pay for
         replacement of such uniform parts. However, if the damage occurs while
         the employee is off duty, or is due to improper care/maintenance or as
         a result of not wearing protective clothing when applicable, the
         employee is responsible to pay for replacement of the uniform part.

J.       Required Basic Uniform - The wearing of uniforms/employees' appearance
         will be as required by Company guidelines. There will be no minimum or
         maximum quantity of required uniform, but all employees must be in the
         required uniform at all times while on duty. An employee who works the
         ramp and also an inside function in the same shift will be able to wear
         the uniform of his choice.

                                    Page 60
<PAGE>

                                   ARTICLE 28
                                    DURATION

This Agreement shall become effective on the date of signing hereof and shall
continue in force and effect until December 15, 2005 and shall renew itself
without change thereafter, unless written notice by either party of intended
change is served in accordance with Section 6, Title II, of the Railway Labor
Act, as amended, at least ninety (90) days prior to December 15, 2005 or
December 15 of any year thereafter.

IN WITNESS WHEREOF, the parties hereto have signed this Agreement the 15th day
of December, 1999.

For the International Brotherhood      For Chautauqua Airlines, Inc.
of Teamsters

/s/ Raymond Benning                    /s/ Bryan K. Bedford
------------------------------         ------------------------------------
Raymond Benning                        Bryan K. Bedford
Director                               President
International Brotherhood of
Teamsters, Airline Division

/s/ Douglas L. Schmidt                 /s/ Jerome L. Balsano
------------------------------         ------------------------------------
Douglas L. Schmidt                     Jerome L. Balsano
Vice President                         Vice President of Customer Service
Local 135

/s/ Barry D. Schimmel                  /s/ Joe S. Dale
------------------------------         ------------------------------------
Barry D. Schimmel                      Joe S. Dale
Business Representative                Customer Service Manager
Local 210

/s/ Michael W. Harmes
------------------------------
Michael W. Harmes
Steward

/s/ Andre D. B. Fairbanks
------------------------------
Andre D. B. Fairbanks
Steward

                                    Page 61<Page>

                                                                   Exhibit 10.13

                                     EMB-145

                      PURCHASE AGREEMENT NUMBER GCT-025/98

                          EMBRAER - EMPRESA BRASILEIRA

                               DE AERONAUTICA S.A.

                                       AND

                                 SOLITAIR CORP.

<Page>

                                      INDEX

   ARTICLE

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

<Page>

                                   ATTACHMENTS

"A" - AIRCRAFT SPECIFIC CONFIGURATION, FINISHING AND REGISTRATION MARKS -
      "APPENDIX 1" - TECHNICAL DESCRIPTION

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

"C" - WARRANTY CERTIFICATE - MATERIAL AND WORKMANSHIP

"D" - EMB-145 PRICE ESCALATION FORMULA

"E" - DISPATCH RELIABILITY GUARANTEE

"F" - FORM OF AUTHORIZED REPRESENTATIVE APPOINTMENT

"G" - FORM OF WARRANTY BILL OF SALE

"H" - FORM OF GUARANTEE

<Page>

                       PURCHASE AGREEMENT N(0) GCT-025/98

THIS AGREEMENT IS ENTERED INTO AS OF THIS ____ DAY OF JUNE, 1998 BY AND BETWEEN
EMBRAER - EMPRESA BRASILEIRA DE AERONAUTICA S.A. AND SOLITAIR CORP., FOR THE
PURCHASE AND SALE OF EMBRAER AIRCRAFT, SERVICES AND RELATED SPARE PARTS.

THIS AGREEMENT SUPERCEDES AND REPLACES (A) PURCHASE AGREEMENT GCT-020/98 DATED
MAY 15, 1998, AND (B) LETTER AGREEMENT GCT-021/98, DATED MAY 15, 1998, AS
AMENDED BY AMENDMENT NUMBER ONE TO LETTER AGREEMENT, DATED MAY 22, 1998, BOTH OF
WHICH HAVE TERMINATED IN ACCORDANCE WITH THE TERMS OF LETTER AGREEMENT
GCT-021/98 WITHOUT LIABILITY TO EITHER PARTY. THE SALE COVERED BY THIS AGREEMENT
SHALL BE GOVERNED SOLELY BY THE TERMS AND CONDITIONS HEREIN SET FORTH, AS WELL
AS BY THE PROVISIONS SET FORTH IN THE ATTACHMENTS HERETO.

THIS AGREEMENT SHALL NOT BE EFFECTIVE UNLESS AND UNTIL IT IS SIGNED BY AN
AUTHORIZED OFFICER OF SOLITAIR CORP. AND EXECUTED BY TWO AUTHORIZED OFFICERS OF
EMBRAER - EMPRESA BRASILEIRA DE AERONAUTICA S.A.

1.    DEFINITIONS

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

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

      b.    Aircraft - shall mean the EMB-145 LR aircraft or, where there is
            more than one of such Aircraft, each of the EMB-145 LR aircraft,
            manufactured by Embraer, for sale to Buyer pursuant to this
            Agreement (for the avoidance of doubt shall include Firm Aircraft
            and Option Aircraft), according to the Technical Description number
            TD-145 /010, dated January 1998 (Appendix I) and the Aircraft
            Specific Configuration, Finishing and Registration Marks described
            in the Attachment "A" to this Agreement as may be amended from time
            to time by Buyer at its expense as specified in Article 11. The
            Preliminary Technical Description and Aircraft Specific
            Configuration which are contained in Attachment "A" hereto, shall be
            substituted by Buyer's Aircraft Technical Specification no later
            than three (3) months prior to the first Aircraft Contractual
            Delivery Date. The Aircraft is composed entirely of vendor parts and
            parts manufactured by Embraer and Embraer subcontractors,

<Page>

            and the parts manufactured by Embraer and Embraer subcontractors
            shall have Embraer part numbers.

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

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

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

      f.    Buyer - shall mean SOLITAIR CORP., a Delaware corporation with its
            principal place of business at 411 West Putnam Avenue, Greenwich, CT
            06830, United States or its assignee pursuant to Article 16 hereof.

      g.    Contractual Delivery Date - shall mean the delivery dates referred
            to in Article 5 of this Agreement.

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

      i.    Designated Operator or "DO" - shall have the meaning specified in
            Article 16 hereof.

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

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

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

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

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

      o.    Parties - shall mean Embraer and Buyer.

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

<Page>

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

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

2.    SUBJECT

      a.    Embraer shall sell and Buyer shall purchase and take delivery of ten
            (10) Aircraft ("Firm Aircraft") and, if Buyer so elects, up to
            twenty (20) option Aircraft ("Option Aircraft") upon the terms and
            conditions contained in this Agreement.

      b.    Embraer shall sell, and Buyer shall acquire, Spares for each of the
            Aircraft. Buyer shall inform Embraer at least six (6) months prior
            to the Contractual Delivery Date of the Spares for each Aircraft
            selected from IPL for such Aircraft and such Spares shall be
            delivered in accordance with Article 5.b.

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

3.    PRICE

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

            1.    The Aircraft Basic Price of [*]

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

            [*]Embraer of the list of Spares selected by Buyer from the
            IPL.

      b.    The Services are to be provided [*]

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

4.    PAYMENT

-----------
* Confidential
<Page>

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

      a.    Aircraft

            1.    An initial deposit of [*] United States dollars) per Aircraft
                  [*] in total) is due and payable within one (1) Business Day
                  after signature of this Agreement.

            2.    A [*] progress payment of each Aircraft Basic Price, less a
                  credit of [*] per Aircraft based upon payment pursuant to
                  Article 4.a.1 is due and payable eighteen (18) months prior
                  to each relevant Aircraft Contractual Delivery Date.

            3.    [*]

            4.    [*] prior to each relevant Aircraft Contractual Delivery
                  Date.

            5.    The difference between [*] and the amounts previously paid
                  pursuant to items "a.1" through "a.4" above, is due and
                  payable [*] of each relevant Aircraft.

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

      b.    Spares:

            1.    [*] or the date of delivery of the Spares calculated in
                  accordance with Article 5.b, and in no event later than
                  the Aircraft Contractual Delivery Date if the Buyer fails
                  to select Spares within the time provided for in Article 2.b.

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

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

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

----------
* Confidential
<Page>

            deposit or progress payment required by items "a" or "b" above for
            any Aircraft or Spares, Embraer shall grant Buyer a three (3)
            Business Day grace period within which to make the required payment
            and shall refrain from sending out the notice referred to below in
            this item "c" for the three (3) Business Day grace period. Such
            grace period shall apply only to the first late deposit or progress
            payment by Buyer under this Agreement. Such grace period shall under
            no circumstances apply to payments due pursuant to Articles 4.a.6
            and 4.b.2. If Buyer fails a second time to make any deposit or
            progress payment for any Aircraft or Spares, Embraer shall be
            entitled to exercise its right pursuant to this item "c" without
            waiting for the expiration of the above referenced three (3)
            Business Day grace period. In the event Embraer does not receive any
            payment required by Articles 4.a and 4.b within ten (10) Business
            Days after Buyer receives written notice from Embraer of its failure
            to receive the payment, Embraer shall have the right to terminate
            this Agreement as to the relevant Aircraft or in its entirety in
            accordance with Article 23.c. Furthermore in the event any payment
            referred to in Articles 4.a and 4.b is not made when required, and
            Embraer has not terminated the Agreement in accordance with this
            Article 4.c and the Buyer fails to provide to Embraer, within ten
            (10) Business Days after the Embraer notice referred to herein, the
            federal reserve wire transfer number for the payment in question and
            issued on or before the day such payment was due, Buyer shall also
            pay Embraer, [*] in accordance with Article 23.c or through and
            including ten (10) Business Days after such payment is due,
            whichever is shorter.

5.    DELIVERY

      a.    AIRCRAFT: Subject to payment in accordance with Article 4 and the
            provisions of Articles 4, 7 and 9, the Aircraft shall be offered for
            delivery by Embraer to Buyer, by means of a notice, for inspection,
            acceptance and subsequent delivery in F.A.F. (Fly Away Factory)
            condition, at Sao Jose dos Campos, State of Sao Paulo, Brazil,
            according to the following schedule. Under no circumstances shall
            Buyer be obligated to accept Aircraft 1 or 2 more than three (3)
            Business Days prior to the Contractual Delivery Date. Under no
            circumstances shall Buyer be obligated to accept Aircraft 3 through
            10 more than seven (7) Business Days prior to the Contractual
            Delivery Date.

                FIRST  AIRCRAFT            April 30, 1999
                SECOND AIRCRAFT            June 30, 1999
                THIRD AIRCRAFT             August 31, 1999
                FOURTH AIRCRAFT            November 30, 1999
                FIFTH AIRCRAFT             January 31, 2000
                SIXTH AIRCRAFT             March 31, 2000
                SEVENTH AIRCRAFT           May 31, 2000

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                EIGHTH AIRCRAFT            July 31, 2000
                NINTH AIRCRAFT             September 30, 2000
                TENTH AIRCRAFT             November 30, 2000

            The above dates are hereafter referred to as the Contractual
            Delivery Dates and with respect to the Aircraft, Aircraft
            Contractual Delivery Dates.

      b.    SPARES: Subject to receipt by Embraer of the list of Spares selected
            by Buyer from the IPL in accordance with Article 2.b, such items
            shall be delivered by Embraer to Buyer in F.C.A. (Free Carrier -
            INCOTERMS 1990) condition, at Sao Jose dos Campos, State of Sao
            Paulo, Brazil, or at any other port of clearance that Embraer may
            identify to Buyer. The provision of Spares for each Aircraft shall
            be delivered on the relevant Aircraft Actual Delivery Date. Should
            Buyer not inform Embraer of Spares items selected by Buyer within
            the schedule set forth in Article 2.b., the Spares shall be provided
            to Buyer in F.C.A. condition, at the same places above mentioned,
            one hundred eighty (180) days after such Spares are selected by
            Buyer. However, Buyer must supply such list of Spares to Embraer no
            later than the relevant Aircraft Contractual Delivery Date.

6.    CERTIFICATION

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

7.    ACCEPTANCE AND TRANSFER OF OWNERSHIP

a.    Unless Embraer notifies Buyer otherwise, the Aircraft shall be delivered
      in accordance with the provisions and schedules specified in Article 5
      herein. Embraer shall give Buyer fifteen (15) days advance notice of the
      date on which Embraer considers that each Aircraft will be ready for
      delivery in the condition specified herein. Upon successful completion of
      ground and flight tests performed by Embraer, Buyer will receive a
      confirmation from Embraer of the day that the Aircraft concerned is ready
      for inspection and will provide Buyer within three (3) Business Days
      notice of the date of such inspection.

b.    Buyer shall be allowed a reasonable period of time to conduct a ground
      inspection and an acceptance flight or flights, if necessary
      ("Inspection") of each Aircraft prior

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      to its delivery. All costs including fuel, pilot, and insurance for the
      Aircraft's acceptance flight will be provided by Embraer ("Inspection
      Costs"). After such acceptance flight and if Buyer accepts the Aircraft in
      accordance with this Article 7, each Aircraft will be delivered by Embraer
      to Buyer in accordance with Article 6 hereof with its fuel tanks full.

      c.    Buyer shall accept the Aircraft provided, in the reasonable
            determination of Buyer, the Aircraft meets the terms and conditions
            of this Agreement. Immediately after such acceptance, Buyer shall
            make the payments due, if any, according to Article 4 and accept
            delivery of such Aircraft, whereupon good and marketable title and
            risk of loss will be transferred to Buyer and Buyer shall execute
            the necessary title and risk transfer documents required in order to
            effect title transfer, including but not limited to an FAA form Bill
            of Sale and a Warranty Bill of Sale substantially in the form
            attached hereto as Schedule G. However, in the event of a declared
            strike at Embraer of relevant Embraer personnel, or a declared
            strike of relevant Buyer personnel, Buyer shall not be required to
            accept the Aircraft as provided for herein until three (3) Business
            Days after Embraer or Buyer provides notice that such strike has
            terminated.

      d.    If Buyer declines to accept an Aircraft after its Inspection because
            the Aircraft failed to meet the terms of this Agreement, Buyer shall
            immediately give Embraer notice of all specific reasons for such
            refusal and [*], commencing on the first Business Day after receipt
            of such notice, to take all necessary actions at no cost to Buyer
            in order to resubmit the Aircraft to Buyer for re-inspection.

      e.    Buyer shall inspect the Aircraft, as provided for in Article 7.b.,
            within [*] after receipt of notice from Embraer that all necessary
            actions were taken ("Reinspection"). All costs of such Reinspection
            shall be borne by Embraer. This period as well as the one mentioned
            in item "d" above shall not be considered as part of the thirty (30)
            day grace period provided for in Article 9.b.1.

      f.    Embraer shall ensure that the Spares for each Aircraft are available
            for inspection by Buyer on or before the date of delivery in
            accordance with Article 5.b. and shall notify Buyer of such
            availability. Buyer shall be allowed to inspect the Spares to be
            delivered in connection with each Aircraft. If Buyer finds such
            Spares acceptable, Buyer shall be entitled, but not obligated, to
            inspect the packing process, and if such an inspection is conducted,
            Buyer shall thereupon give Embraer notice of acceptance and receipt
            of Spares in question, after which notice Embraer shall not be
            responsible for shortages or have any liability in regard to any
            claim or demand whatsoever, from Buyer, with respect to such
            provision and Buyer shall be deemed to have waived any of its rights
            with respect to such delivery except for warranty claims submitted
            pursuant to Attachment C. If Buyer reasonably rejects one or more of
            the Spares during such inspection as not conforming to this
            Agreement, Embraer shall replace at Embraer's cost such rejected
            Spare or Spares with Spares which are in conformity to the
            Agreement. Buyer's failure, including but not limited to Buyer's
            refusal to perform the inspection or acceptance of all their

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            Spares after being notified of their availability by Embraer, shall
            not prevent Embraer from delivering such Spares direct to Buyer in
            accordance with Article 5.b. In the event that Buyer does not
            inspect the packing process as provided for herein, it shall have
            fifteen (15) Business Days to inspect the Spares after Buyer's
            receipt of such Spares and serve Embraer with written notice of
            acceptance or rejection of such Spares. If Buyer fails to issue the
            notice within such fifteen (15) days or provide Embraer with a
            shortage claim, it shall be deemed to waive any shortage claims.

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

      h.    Should Buyer not perform its obligations in accordance with items
            7(a) through 7(e) hereof within ninety (90) calendar days to be
            computed from the notification specified in item "a" above, Embraer
            shall be entitled to either terminate this Agreement with respect to
            such Aircraft, pursuant to Article 23.c. or, at its sole discretion,
            re-negotiate the terms of this Agreement with respect to such
            Aircraft with Buyer. If Buyer wrongfully fails to perform its
            obligations in accordance with items 7(a) through 7(e) hereof, at
            any subsequent time, Embraer shall be entitled to terminate this
            Agreement with respect to all unaccepted or undelivered Aircraft or
            related Spares pursuant to Article 23.c. below.

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

      j.    [*]

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            [*]

8.    STORAGE CHARGE

      a.    [*]

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

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

            3.    Buyer's failure within one (1) Business Day after title
                  transfer to remove an Aircraft from Embraer's facilities.

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

                  If however, Buyer notifies Embraer in writing ten (10) days in
                  advance of its expected delay in the performance of its
                  obligations set forth in this Article 8, the storage charge
                  shall commence on the fifteenth (15th) day after the
                  occurrence of the events set forth in this Article 8.a.

      b.    In the event that an Aircraft Contractual Delivery Date must be
            extended by Embraer from that which is designated in Article 5, due
            to Buyer's failure to perform any action or provide any information
            contemplated by this Agreement other than the ones specified in the
            preceding items, and the Aircraft otherwise was to be delivered on
            the Contractual Delivery Date, the storage charge shall commence on
            the fifteenth (15th) day after the Contractual Delivery Date
            relative to such Aircraft.

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      c.    Buyer shall pay the storage charge set forth in Article 8.a. and
            8.b., as applicable, per each month of delay or part thereof, within
            five (5) Business Days after the presentation of each invoice by
            Embraer.

9.    DELAYS IN DELIVERY

      a.    EXCUSABLE DELAYS:

            1.    Embraer shall not be held liable or be found in default for
                  any delays in the delivery of an Aircraft or any Spares or in
                  the performance of any act to be performed by Embraer under
                  this Agreement, resulting from the following events or
                  occurrences, hereinafter referred to as "Excusable Delays":
                  (a) force majeure (including, but not limited to, war or state
                  of war, civil war, insurrection, fire, accident, explosion,
                  flood, act of government or governmental priorities (other
                  than acts of the Government of Brazil acting in its capacity
                  as a shareholder of Embraer), requisition, strike, labor
                  troubles), (b) any delay to the extent resulting from any
                  failure by Buyer to perform any action or provide any
                  information contemplated by this Agreement.

            2.    Within [*] after the occurrence of any of the above mentioned
                  events which constitute causes of Excusable Delays in delivery
                  of an Aircraft or any Spares or in the performance of any act
                  to be performed by Embraer under this Agreement, Embraer shall
                  send a notice to Buyer, with a requested acknowledgment of
                  receipt, including a description of details involved and an
                  estimate of the effects expected upon the timing of the
                  performance of its contractual obligations.

            3.    Any such delays shall extend the time for delivery of an
                  Aircraft or Spares by the same number of days required for the
                  cause of delay to be remedied. Embraer undertakes to use all
                  commercially reasonable efforts whenever possible to avoid or
                  remove any such cause of delay and to minimize its effect on
                  the Contractual Delivery Date of an Aircraft or Spares.

            4.    If the cause of such Excusable Delay is such as to last longer
                  than three hundred (300) days or to render the performance of
                  this Agreement impossible, then Buyer shall have the option to
                  terminate this Agreement without liability to either party, in
                  accordance with Article 23.b.

      b.    NON-EXCUSABLE DELAYS:

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            1.    If the delivery of an Aircraft or Spares is delayed, not as a
                  result of an Excusable Delay, by more than [*] after the
                  Contractual Delivery Date for such Aircraft or, in the case
                  of Spares, the date for delivery as agreed between the Parties
                  in accordance with Article 5.b., Buyer will be entitled to
                  elect to receive in accordance with item "b.3" below from
                  Embraer liquidated damages as compensation for such delay
                  equal to [*], up to the date that the Aircraft is ready for
                  delivery and available to Buyer by means of confirmation of
                  the successful completion of ground and flight tests performed
                  by Embraer, to be provided per Article 7.a, it being
                  understood that such liquidated damages will not, in any
                  event, [*] and that it will only be due and payable by Embraer
                  to Buyer after Buyer pays to Embraer the total Aircraft
                  Purchase Price and/or Spares items price as applicable. Such
                  liquidated damages shall be paid at Buyer's option in cash or
                  in the form of a credit for spare parts or other Embraer-
                  provided services.

            2.    The grace period of [*], or part thereof, granted by Buyer to
                  Embraer as mentioned herein shall prevail if Embraer provides
                  notice to Buyer advising the expected delay, provided that
                  such notice shall be issued to Buyer [*] prior to the
                  relevant Aircraft Contractual Delivery Date, or in the case
                  of Spares, [*] prior to the date of delivery as agreed
                  between the Parties in accordance with Article 5.b. The grace
                  period shall be reduced by the same number of days Embraer
                  delays the issuance of said notice beyond such [*].

            3.    If, with respect to a delayed Aircraft or Spares, Embraer does
                  not receive notice for liquidated damages as mentioned in item
                  "b.1" above, from Buyer within one hundred and twenty (120)
                  days after the Delivery Date of such Aircraft, or in the case
                  of Spares, the date of delivery as agreed between the Parties
                  in accordance with Article 5.b., Buyer shall be deemed to have
                  fully waived its right to such liquidated damages.

            4.    If as a result of a Non-Excusable Delay, the delivery of any
                  Aircraft will be delayed to a date beyond the Contractual
                  Delivery Date or any revised date previously agreed to in
                  writing by the parties, the price escalation formula set forth
                  in Attachment D will not apply with respect to the days
                  constituting the delay.

            5.    Embraer hereby acknowledges that the schedule by which the
                  Aircraft and Spares are to be delivered as set forth in
                  Article 5 hereof, was a material inducement to Buyer to enter
                  into this Agreement. Consequently, it hereby represents and
                  warrants to Buyer that in the event of a nonexcusable delay by
                  Embraer, Buyer's delivery positions will not be unfairly
                  prejudiced relative to the delivery positions of any other
                  purchaser or acquirer ("Purchaser") of any

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                  EMB-145 aircraft, by Embraer having declared a Nonexcusable
                  Delay in accordance with this Agreement. If Buyer's delivery
                  positions are unfairly prejudiced for less than 15 days
                  relative to any other Purchaser's delivery positions, such
                  delay shall not be considered a breach of this Article 9.b.5.
                  In the event of Seller's breach of the representation and
                  warranty provided for herein, Buyer may terminate this
                  Agreement in accordance with Article 23.b.1. and/or may seek
                  damages for Embraer's breach in accordance with Article 23.a.

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

            Should any Aircraft be destroyed or damaged before acceptance by the
            Buyer to the extent that it becomes commercially useless, Buyer may,
            at its sole discretion take a replacement Aircraft under the same
            terms and conditions of this Agreement at a later delivery date to
            be agreed by the Parties. Within three (3) months after such loss,
            Embraer will provide Buyer with a new delivery date for a
            replacement Aircraft. If Buyer in its sole discretion rejects the
            new delivery date after further consultation with Embraer on
            scheduling the delivery of the Aircraft, it may terminate this
            Agreement with respect to such Aircraft and the Spares to be
            delivered with such Aircraft, by notice to Embraer given in
            accordance with Article 25, without any liability to either party
            and Embraer will return all deposits and progress payments paid with
            respect to such terminated Aircraft to Buyer within five (5)
            Business Days after Embraer receives the notice referred to above
            with interest at the [*] commencing on the date such deposits and
            progress payments were paid to Embraer. In the event Embraer fails
            to return the deposits and progress payments with accumulated
            interest to Buyer as provided for herein, Embraer should also pay
            to Buyer additional interest of [*] on such outstanding amounts not
            paid by Embraer from the date on which such payments should have
            been made until receipt by the Buyer.

10.   INSPECTION AND QUALITY CONTROL

      a.    Buyer is hereby permitted to have one or more authorized
            representatives at Embraer's facilities for a period commencing
            three (3) months prior to the Contractual Delivery Date of each
            Aircraft in order to assure that the Aircraft, Spares and Services
            were developed in accordance with the procedures specified in this
            Agreement and according to all applicable quality control standards.
            Buyer may communicate its concerns as to the production of the
            Aircraft and Spares to Embraer.

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

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

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

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

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

11.   CHANGES

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

      b.    All the specified tray-mounted avionic equipment installed in the
            Aircraft shall be of the latest modification standard made available
            to Embraer by the relevant vendor at such time as not to violate the
            delivery schedule of the Aircraft. All other parts will be of the
            latest modification standard available at the moment of scheduled
            installation in the Aircraft.

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

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

                  o     Performance, weight or balance;
                  o     Structural strength, flight qualities, operation and/or
                        characteristics;
                  o     Interchangeability of parts reasonably defined by
                        Embraer as interchangeable;

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                  o     Aircraft delivery, delivery dates, and prices;
                  o     Operational safety;
                  o     Ease of maintenance;
                  o     Noise and environmental control

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

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

      e.    Major Changes as referred to in item "c.2." above which are
            classified as AD's mandatory by CTA and or FAA shall be conveyed to
            Buyer by means of Service Bulletins, approved by said authorities.
            Incorporation of such Service Bulletins in all Aircraft and Spares
            yet to be delivered to Buyer will be made by Embraer at Embraer's
            own costs, in a commercially reasonable period of time.
            Incorporation of Service Bulletins in Aircraft and Spares delivered
            to Buyer shall be made by Buyer at its own cost but for Service
            Bulletins which are issued arising from mandatory AD's issued by the
            FAA or CTA and which relate to defective parts which are identified
            by an Embraer part number ("Embraer AD's"). Such Embraer AD's shall
            be provided to Buyer in accordance with the warranty period provided
            in Attachment C. When flight safety is affected, such changes will
            be immediately incorporated.

            Whenever warranty coverage is not available or applicable, item "e"
            of this Article 11 shall apply. No indemnification shall be due by
            Embraer for the down-time of the delivered Aircraft needed for the
            incorporation of any such changes but for delays caused by the
            incorporation of Embraer AD's. In the event of delay caused by
            incorporation of Embraer AD's, Embraer shall be responsible for
            liquidated damages in accordance with Article 9.b (and the price
            escalation formula as set forth in Attachment D shall not apply with
            respect to any delay occasioned by the need to incorporate an AD).

            Embraer shall not be held liable for any delays in the Aircraft
            Contractual Delivery Date resulting from the execution of any change
            classified as mandatory by CTA or FAA when the Aircraft shall have
            already passed the specific production stage affected by the
            incorporation of said change. In the event that an AD is issued by
            the CTA or FAA prior to delivery with a terminating action date
            after delivery of the relevant Aircraft and Embraer has a solution
            for implementation of such AD prior to delivery and such
            implementation will not alter the delivery date of such Aircraft,
            Embraer will use commercially reasonable efforts to incorporate such
            AD prior to delivery of the relevant Aircraft .

      f.    Major Changes (other than those which are AD's mandatory per item
            "e" above), any change developed by Embraer as product improvement,
            and any change requested by Buyer which are either Major or Minor ,
            including those changes required by FAA

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            as a consequence of alterations, amendments and/or innovations of
            its present airworthiness regulations which are in effect subsequent
            to the date of the Agreement but before an Aircraft Delivery Date
            and which are applicable to all aircraft in general as the all
            aircraft of the same category as the Aircraft, shall be considered
            as optional and, pursuant to Buyer's request, the corresponding cost
            proposals shall be submitted by Embraer to Buyer for consideration
            and approval. Should Buyer not approve any such change, it shall not
            be incorporated in the Aircraft.

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

      h.    Except as it relates to AD's made mandatory by CTA or FAA which do
            not materially affect the performance of the Aircraft and Minor
            Changes, should an Aircraft not comply with the terms and conditions
            of Attachment "A", Buyer shall be entitled to either terminate this
            Agreement with respect to that relevant Aircraft, pursuant to
            Article 23.d, or, at its sole discretion, renegotiate the terms and
            conditions of this Agreement with Embraer.

12.   WARRANTY

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

13.   TECHNICAL ASSISTANCE SERVICES

      a.    Familiarization and technical support programs specified below are
            being offered at no charge to Buyer unless otherwise specified,
            except for the expenses involved with travel and lodging of
            Designated Operator's trainees, which shall be borne by Buyer or
            Designated Operator (as defined in Article 16). Such familiarization
            and technical support programs shall be in accordance with Embraer's
            training syllabus.

      b.    Notwithstanding the use of the term "training" in this Article 13 or
            in the Agreement, the intent of the Services is solely to
            familiarize a Designated Operator's pilots, mechanics, employees or
            representatives, duly qualified per the governing body in the United
            States of America, with the operation and maintenance of the
            Aircraft. It is not the intent of Embraer to provide basic training
            ("Ab-initio") to any representatives of a Designated Operator.

      c.    The Services, as applicable, shall be provided prior to the last
            Aircraft Actual Delivery Date as shall be agreed upon by Buyer and
            Embraer and in accordance with Article 7.j. herein. Each Designated
            Operator must give notice to Embraer

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

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

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

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

            2.    One (1) Maintenance Familiarization Course for up to [*]
                  qualified mechanics of the Designated Operator's mechanics per
                  Firm Aircraft. This course shall consist of classroom
                  familiarization with Aircraft systems and structures and shall
                  be in accordance with ATA specification 104, level III.

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

            4.    [*] Embraer technical [*] selected by Embraer in its sole
                  discretion shall be assigned to stay at the main maintenance
                  base of the first Designated Operator in the United States in
                  order to assist and advise such Designated Operator on
                  Aircraft maintenance during its initial operation and to act
                  as liaison between such first Designated Operator and
                  Embraer. The presence of Embraer's technical representative
                  in the maintenance base of such first Designated Operator
                  shall be free of charge for the first [*] after the first
                  Actual Aircraft Delivery Date. Thereafter, every time Buyer
                  requests the placement of an Embraer technical representative
                  at a Designated Operator's installations, Embraer will charge
                  Buyer for any such Designated Operator according to Embraer's

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                  price list per month per each such Embraer's technical
                  representative's presence.

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

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

      f.    If Buyer or Designated Operator elects not to take all or any
            portion of the Services, no refund or other financial adjustment of
            the Basic Price will be made, since such Services are offered free
            of charge as referred to in item "b" of Article 3 of the Agreement,
            unless the Service is being charged by Embraer as specified in
            paragraph e.4 above. Any other additional services shall depend on
            subsequent agreement and shall be charged by Embraer accordingly,
            except

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            that Embraer further agrees, in addition to the Services as
            described above, to provide each Designated Operator, at such
            Designated Operator's expense, a customized product support package
            to meet such Designated Operator's need at service entry.

      g.    Buyer and the Designated Operator's authorized trainees and
            representatives at Embraer's facilities shall be allowed exclusively
            in those areas related to the subject matter hereof and Buyer agrees
            to, and to cause the relevant Designated Operator to, hold harmless
            Embraer from and against all and any kind of liabilities in respect
            of such trainees and representatives for whom Buyer and Designated
            Operator, as the case may be, are solely and fully responsible under
            all circumstances, except to the extent caused by the gross
            negligence or willful misconduct of Embraer, its employees or
            agents.

14.   SPARE PARTS POLICY

      Embraer guarantees the supply of spare parts and ground support equipment
      for the Aircraft in accordance with Section 2 of Attachment "B" for a
      period of [*] Such spare parts and ground support equipment shall be
      supplied according to the prevailing availability, sale conditions,
      delivery schedule and effective price on the date of acceptance by
      Embraer of the purchase order. The spare parts and ground support
      equipment may be supplied either by Embraer or through its subsidiaries
      or branch offices located abroad.

15.   PUBLICATIONS

a.    AIRCRAFT PUBLICATIONS - Embraer shall supply, at no cost to Buyer, copies
      of operational and maintenance publications applicable thereto, in the
      English language and in the quantities as specified in item "3" of
      Attachment "B". Such publications are issued under the applicable
      specification and are available in hard copies. The revision service for
      these publications is provided, free of charge, including mailing services
      (except for air cargo shipping), for the first [*] Such publications will
      be delivered together with the Aircraft.

      If requested by Buyer, one (1) set of basic publications (not reflecting
      Buyer's Aircraft configuration) may be supplied earlier, at a time and
      location to be agreed upon by the Parties, but in no event before four (4)
      months prior the delivery of the first Aircraft.

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

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16.   ASSIGNMENT AND GUARANTEE

      a.    Provided the warranty provisions in Article 12, 13, 14, 15 and
            Attachment B and C are still effective in accordance with their
            terms, then after Delivery of an Aircraft and Spares, Buyer may
            lease, sell or otherwise transfer the Aircraft and Spares to one or
            more air carriers (whether certificated or not and whether based in
            the United States or any other country) or to any other entities,
            (but for entities or air carriers which are owned, effectively
            controlled or managed by or to any other airframe manufacturer which
            competes in the thirty seven (37) to seventy (70) seat turbo jet
            market) (collectively referred to as "Transferees", and
            individually, together with each Other Transferee (as defined
            below), a "Designated Operator") and in connection with such leases,
            sales, or transfers Buyer may assign Buyer's rights pursuant to
            Articles 12, 13, 14, 15 and Attachments B and C with respect to the
            relevant Aircraft and Spares to such Transferees provided that Buyer
            notifies Embraer of the identity of such Transferees at least thirty
            (30) calendar days prior to such transaction and provides Embraer
            with prior written notice of any events under such agreement that
            would cause any rights thereby assigned to revert to Buyer under
            such agreement. In the event such Transferees or Other Transferees
            (as defined below) subsequently transfer the Aircraft and Spares,
            any Transferees' or Other Transferees' rights which remain pursuant
            to Articles 12, 13, 14, 15 and Attachments B and C with respect to
            the relevant Aircraft and Spares may also be transferred with
            respect to the relevant Aircraft to any other entity (but for
            entities or air carriers which are owned, effectively controlled or
            managed by any other airframe manufacturer which competes in the
            thirty seven (37) to seventy (70) seat turbo jet market) ("Other
            Transferees") provided that the Transferees or Other Transferees
            notify Embraer of the identity of such other entity at least sixty
            (60) calendar days prior to such transaction and provide Embraer
            with prior written notice of any events under such agreement that
            would cause any rights thereby assigned to revert to Transferees or
            Other Transferees under such agreement.

      b.    Before Delivery Buyer may assign any or all of its rights under this
            Agreement to purchase any one or more of the Aircraft and Spares to
            any one or more non-Brazilian majority owned subsidiaries of Buyer,
            or non-Brazilian affiliates of Buyer or Wexford Management LLC which
            as of the date of such assignment are effectively managed by Buyer
            or Wexford Management LLC; provided that Buyer guarantees the
            payment obligations of such assignee in the form attached hereto as
            Attachment H. Buyer may also assign, sell, transfer or dispose of
            any or all of its rights and obligations to a financing institution
            reasonably approved by Embraer, considering the size of the proposed
            financing relative to the creditworthiness of the financing
            institution, when such disposition is made in connection with the
            initial financing of the progress payments or the final payments
            required under this Agreement. Buyer may request, and Embraer will
            take, any action reasonably necessary for the purpose of causing an
            Aircraft and

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            Spares at the time of delivery to be subject to an equipment trust
            conditional sale, lien or other arrangement for the initial
            financing of the Aircraft and Spares.

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

17.   RESTRICTIONS AND PATENT INDEMNITY

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

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

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

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

18.   MARKETING PROMOTIONAL RIGHTS

      Embraer shall have the right to show for marketing purposes, free of any
      charge, the image of the Aircraft, painted with Buyer's colors and emblems
      or the colors and emblems of any Designated Operator, affixed in
      photographs, drawings, films, slides, audiovisual works, models or any
      other medium of expression (pictorial, graphic, and sculptural works),
      through all mass communications media such as billboards, magazines,
      newspaper, television, movie, theaters, as well as in posters, catalogues,
      models and all other kinds of promotional material. In the event such
      Aircraft is sold to or operated by or for another company or person,
      Embraer shall be entitled to disclose such fact, as well as to continue to
      show the image of the Aircraft, free of any charge, for marketing
      purposes, either with the original or the new colors and emblems, unless
      otherwise notified by Buyer or Designated Operator, provided that such
      notification shall be subject to the reasonable satisfaction and agreement
      of Embraer. If accepted, said prohibition, however, shall in no way apply
      to the promotional materials or pictorial, graphic or sculptural works
      already existing or to any contract for the display of such materials or
      works already binding Embraer at the time of receipt of the notification.
      The provisions of this

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      Article shall be included in all future sales or lease agreements
      concerning the Aircraft.

19.   TAXES

      Embraer shall pay all taxes arising from the sales subject of this
      Agreement, as may be imposed on the sale under Brazilian laws. All other
      taxes (but for any U.S. taxes on the income of Embraer or its affiliates
      and subsidiaries), impost, fees, withholding taxes, stamp taxes,
      documentary taxes and any other similar or dissimilar taxes, as well as
      any duties as may be imposed on the sale subject of this Agreement
      ("Taxes"), shall be borne by Buyer. Upon the request of either party, the
      other party shall execute and deliver to the requesting party any document
      reasonably necessary or desirable in connection with an exemption from,
      reduction of, or the contesting of the imposition of any Taxes.

20.   APPLICABLE LAW

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

21.   ARBITRATION

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

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

c.    The Arbitrator will be selected as follows: within fifteen (15) Business
      Days of the referral of any matter to arbitration, each party will select
      an arbitrator. Thereafter, within fifteen (15) Business Days of each
      party's selection of an arbitrator, the two

<Page>

      arbitrators selected by the Parties shall meet to select a mutually
      agreeable third arbitrator. In the event a party fails to select an
      arbitrator with in the time period specified above, the party that has
      timely complied with the selection of an arbitrator shall select a second
      arbitrator. These two arbitrators shall within seven (7) Business Days
      after the time in which the other party should have selected an
      arbitrator, meet to select a mutually agreeable third arbitrator. These
      three arbitrators shall comprise the arbitral panel and all arbitral
      proceedings shall be conducted in the presence of all three arbitrators.

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

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

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

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

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

22.   SOVEREIGN IMMUNITY, VENUE AND FORUM NON CONVENIENCE

<Page>

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

23.   TERMINATION

      a.    Should either party fail to comply partially or completely with its
            obligations hereunder, the other party shall be entitled to give
            notice of such failure and to require that such failure be remedied
            within the period specified in that notice, which period shall not
            be less than ten (10) days. Should such failure not be remedied
            within the period so specified, then the party who gave notice of
            such failure shall be entitled to terminate this Agreement. Should
            termination occur in accordance with the foregoing, the defaulting
            party shall pay to the non-defaulting party, as damages, an amount
            determined by agreement or by law. The foregoing provision shall not
            apply in any circumstance where a specific right of termination is
            available or will be available upon the expiration of a specific
            period of time whether or not such termination rights are exercised,
            except with respect to Buyer's right to terminate this Agreement in
            accordance with Article 23.b in case of termination for a
            Non-excusable delay of 90 days or longer as a result of Embraer's
            breach of Article 9.b.5 or termination of this Agreement in
            accordance with Article 23.b.1.

      b.    Buyer shall have the right but not the obligation to terminate this
            Agreement in respect to the relevant Aircraft, upon the occurrence
            of any Excusable Delay in accordance with Article 9.a.4 of three
            hundred (300) days or longer, impossibility as provided for in
            Article 9.a.4, or any non-excusable delay in accordance with Article
            9.b.1 of ninety (90) days or longer after such Aircraft Contractual
            Delivery Date, such right to be exercisable by notice from Buyer to
            Embraer to such effect no earlier than the three hundredth (300th),
            day, ninetieth (90th) day, or in the event of impossibility,
            reasonably thereafter, as applicable. Upon receipt of such notice of
            termination, Embraer shall, within five (5) Business Days after
            Embraer receives the notice referred to above, return to Buyer an
            amount equal to the amounts previously paid by Buyer relative to the
            relevant Aircraft with interest at the [*] in effect as of the time
            such amounts were paid, less the value of equipment previously
            delivered and services previously performed by Embraer specifically
            for Buyer, permitted assigns, and prospective assigns, with respect
            to such terminated Aircraft valued in accordance with Embraer's list
            price for such equipment and services at time of such termination in
            accordance with

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            this Article 23.b and not previously paid for by Buyer. In the event
            the equipment referred to above in the immediately preceding
            sentence has not been used, it may be returned to Embraer at the
            Buyer's sole cost and expense and subject to Embraer's reasonable
            right to inspect such equipment, and in the event of such return and
            acceptance of the condition of the equipment, the value of such
            returned equipment shall not be deducted from the amounts payable by
            Embraer as provided for above. No other penalty or indemnity shall
            be due from Embraer in this case, except in the case of a
            termination for a Non-Excusable Delay of 90 days or longer as a
            result of a breach of Article 9.b.5. In the event Embraer fails to
            return the deposits and progress payments with accumulated interest
            to Buyer as provided for herein, Embraer shall also pay to Buyer
            additional interest of one percent (1%) per month on such
            outstanding amounts not paid by Embraer from the date on which such
            payments were to have been made until receipt by Buyer.

      b.1   In the event that Embraer breaches the representations and
            warranties contained in Article 9.b.5 Buyer may terminate this
            entire Agreement and Embraer will return to the Buyer [*],
            permitted assigns, and prospective assigns with respect to such
            terminated Aircraft valued in accordance with Embraer's list price
            for such equipment and services at time of such termination in
            accordance with this Article 23.b.1 and not previously paid for
            by Buyer. In the event the equipment referred to above in the
            immediately preceding sentence has not been used, it may be
            returned to Embraer at the Buyer's sole cost and expense and
            subject to Embraer's reasonable right to inspect such equipment,
            and in the event of such return and acceptance of the condition
            of the equipment, the value of such returned equipment shall not
            be deducted from the amounts payable by Embraer as provided for
            above. In the event Embraer fails to return the deposits and
            progress payments with accumulated interest to Buyer as provided
            for herein, Embraer shall also pay to Buyer additional interest
            of [*] per month on such outstanding amounts not paid by Embraer
            from the date on which such payments were to have been made until
            receipt by Buyer. In addition to and not in lieu of this remedy
            the Buyer may seek to recover damages for breach of Article 9.b.5
            pursuant to Article 23.a.

      c.    If Buyer terminates this Agreement before an Aircraft Actual
            Delivery Date for any reason not attributable to Embraer's default
            under this Agreement or, if Embraer terminates this Agreement as to
            any Aircraft or in its entirety pursuant to Article 7.h. or Article
            4.c., Buyer shall pay to Embraer the amount of all deposits and
            progress payments due and owing as of the date of such termination
            under this Agreement and shall indemnify Embraer for the value of
            equipment previously delivered and/or services previously performed
            by Embraer specifically for Buyer, permitted assigns, and
            prospective assigns, and for the reasonable costs and expenses of
            reconfiguring Aircraft for sale to another customer. Such costs and
            expenses shall be based on Embraer's then prevailing price list. For
            these

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            purposes Embraer may, in its sole discretion, retain all amounts
            previously paid by Buyer to apply as part of the payments of the
            damages resulting from such default on the part of Buyer.

      d.    If Buyer terminates this Agreement in respect to an Aircraft or all
            Aircraft, as the case may be, pursuant to Articles 9.c or 11.h ,
            Embraer, upon Buyer's request, shall within five (5) Business Days
            after Embraer receives the notice of termination referred to above,
            return to Buyer all amounts previously paid by Buyer with respect to
            the relevant Aircraft, with interest at the [*] in effect on the
            date of receipt of such amounts. No other penalty or indemnity shall
            be due from Embraer in this case. In the event Embraer fails to
            return the deposits and progress payments with accumulated interest
            to Buyer as provided for herein, Embraer shall also pay to Buyer
            additional interest of [*] per month on such outstanding amounts
            not paid by Embraer from the date on which such payments were to
            have been made until receipt by Buyer.

      e.    In the case of a termination of this Agreement or as to any
            Aircraft, the indemnities set forth in Articles 17 and 25 of this
            Agreement and the warranty as provided for in Attachment C hereto
            and as such warranty may have been assigned pursuant to Article16.a
            with respect to any delivered Aircraft and Spares shall survive the
            termination of this Agreement or the termination of this Agreement
            with respect to one or more Aircraft.

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

      Buyer shall have the option to purchase the Option Aircraft, to be
      delivered at a rate of one Aircraft every other month beginning March 2001
      through May 2004, subject to the terms and conditions of this Article 24.

      The Option Aircraft shall be divided into four groups of five aircraft.
      The groups shall be referred to respectively as " Group One", " Group
      Two", " Group Three", and "Group Four". The groups shall be referred to
      collectively as the "Option Groups" and each may be referred to
      individually as an "Option Group".

      a.    INITIAL DEPOSIT A deposit of US [*]

      b.    BASIC PRICE The unit basic price of each Option Aircraft shall be
            equal to the Basic Price, provided that such Option Aircraft be
            delivered to Buyer between March 2001 and May 2004 and in the same
            configuration, specification and installations specified in
            Attachment "A", as such attachment is written on the date of
            signature of this Agreement unless otherwise modified by the Parties
            and the costs for such changes shall be in addition to the Basic
            Price.

      c.    ESCALATION The unit basic price of each relevant Option Aircraft
            shall be escalated according to [*]

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

            1.    [*]

            2.    [*]

            3.    [*]

            4.    [*]

            5.    [*]

            6.    [*]

      e.    CONFIRMATION OF GROUPS ONE AND TWO Buyer's options to purchase
            Option Group One and Option Group Two shall be confirmed on or
            before [*] specified above for the first Option Aircraft of
            that Option Group.

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      f.    CONFIRMATION OF GROUPS THREE AND FOUR If Buyer confirms Group One
            and Group Two in accordance with item "e" above, Buyer shall receive
            an option to purchase Group Three. If Buyer confirms Group Three in
            accordance with this item "f" , Buyer shall receive an option to
            purchase Group Four. The delivery positions in Group Three and Group
            Four (the "Proposed Delivery Positions") are subject to availability
            until confirmed by Embraer in accordance with this item "f".

            1.    If Buyer has satisfied the requirements of items "a" and "e"
                  above and has notified Embraer in writing that it desires to
                  confirm the relevant Option Group, no later than [*] in that
                  Option Group, Embraer shall notify Buyer whether the Proposed
                  Delivery Positions are available for the Option Group. This
                  notice shall be referred to as the "Confirmation Notice" and
                  shall be provided no later than [*]

            2.    The Confirmation Notice shall offer either the Proposed
                  Delivery Positions for the Option Group or other delivery
                  positions. If the Confirmation Notice offers the Proposed
                  Delivery Positions for the Option Group, or if Buyer accepts
                  the other offered delivery positions within [*] after receipt
                  of the Confirmation Notice, then the offered delivery
                  positions shall immediately be removed from the market by
                  Embraer, Buyer shall be deemed to have confirmed the Option
                  Group, and the Option Aircraft in the Option Group shall be
                  purchased pursuant to this Agreement.

      g.    FAILURE TO CONFIRM; RETURN OF DEPOSIT If Buyer (i) fails to confirm
            an Option Group as provided in items "e" or "f" above, (ii)
            renounces its rights to receive any Option Group, or (iii) fails to
            obtain an option to purchase Group Three or Group Four, Buyer shall
            have no right to acquire Option Aircraft in that Option Group and
            the relevant portion of the deposit made according to item "d.1"
            above, if any, shall be refunded to Buyer within five (5) Business
            Days after Buyer's failure to confirm, renunciation of , or failure
            to obtain, an option to purchase the Option Group, with interest at
            the [*] commencing on the date such deposits were paid to Embraer,
            or at Buyer's option Embraer shall apply any amounts paid by Buyer
            to any amounts then due and owing to Embraer by Buyer. In the event
            Embraer fails to return the deposits with accumulated interest to
            Buyer as provided for herein, Embraer shall also pay to Buyer
            additional interest of [*] per month on such outstanding amounts
            not paid by Embraer from the date on which such payments were to
            have been made until receipt by Buyer.

      h.    SERVICES The services Embraer will provide pursuant to Article 13 in
            regard to the Option Aircraft which will be delivered pursuant to
            this Article 24 shall be in accordance with Article 13.e.1 - 4
            above, but such Services per Option Aircraft shall be limited to one
            (1) pilot Familiarization Program for up to [*] pilots per
            Option Aircraft, one (1) Maintenance Familiarization Course for up
            to [*]

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            qualified mechanics per Option Aircraft, and one (1) Flight
            Attendant Familiarization Course for up to [*] flight
            attendants per Option Aircraft.

25.   INDEMNITY

      Buyer agrees to indemnify and hold harmless Embraer and Embraer's
      officers, agents, employees and assignees from and against all
      liabilities, damages, losses, judgments, claims and suits, including costs
      and expenses incident thereto, which may be suffered by, accrued against,
      be charged to or recoverable from Embraer and/or Embraer's officers,
      agents, employees and assignees by reason of loss or damage to property or
      by reason of injury or death of any person (excluding Embraer's officers,
      directors, employees or agents) resulting from or in any way connected
      with the performance of services by employees, representatives or agents
      of Embraer for or on behalf of Buyer related to Aircraft delivered by
      Embraer to Buyer or a Designated Operator, including, but not limited to,
      technical operations, maintenance, and training services and assistance
      performed while on the premises of Embraer, a Designated Operator, or
      Buyer, while in flight on Buyer-owned Aircraft or while performing any
      other service, at any place, in conjunction with the Aircraft except to
      the extent caused by the gross negligence or willful misconduct of
      Embraer, its employees or agents.

26.   NOTICES

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

            a. Embraer:

            EMBRAER - Empresa Brasileira de Aeronautica S.A.
            Av. Brigadeiro Faria Lima, 2170
            12.227-901 Sao Jose dos Campos - SP
            BRAZIL
            Attention:
            Senior Manager, Contract Administration
            Telephone: (55-12)345-1410
            Facsimile: (55-12)345-1257

            b. Buyer

--------
* Confidential
<Page>

         Solitair Corp.
         411 West Putnam Avenue, Suite 125
         Greenwich, CT  06830
         USA
         Attention: Frederick Simon, President
         Telephone: (203) 862-7011
         Facsimile: (203) 862-7490

         with copies to
         Wexford Management LLC
         411 West Putnam Avenue, Suite 125
         Greenwich, CT  06830
         USA
         Attention: Jay L. Maymudes, Principal and Chief Financial Officer
         Telephone: 203-862-7050
         Facsimile: 203-862-7350

27.   CONFIDENTIALITY

      Neither party shall have the right to disclose the terms of this Agreement
      except as required by law. To the fullest extent permitted by law, except
      as aforesaid, neither party shall disclose any portion of this Agreement
      or its Attachments, amendments or any other supplement, to any third
      party, other than to its accountants, attorneys, agents, consultants or
      permitted assignees without the other party's prior written consent, and
      any such accountants, attorneys, agents consultants or permitted assignees
      shall agree in writing to be bound by the terms of this Article 27.
      Without limiting the foregoing, in the event either party is legally
      required to disclose the terms of this Agreement, the parties agree to
      exert their reasonable best efforts to request confidential treatment of
      the clauses and conditions of this Agreement relevantly designated by
      either party as confidential. Notwithstanding the foregoing, nothing
      contained herein shall limit the ability of the Buyer (i) to disclose (a)
      information relating to the specifications of the Aircraft, (b) the
      delivery schedule relating to the Aircraft, or (c) copies of Attachments
      A, B, C, F, or G to the Agreement to any prospective buyer, lessor,
      assignee or any agent or broker with respect to any Aircraft, or (ii) to
      disclose, subject to a confidentiality agreement reasonably acceptable to
      Embraer, copies of relevant portions of this Agreement to any prospective
      lender with respect to any Aircraft (provided that such lender is a
      permitted lender pursuant to Article 16.b).

28.   INTEGRATED AGREEMENT

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

<Page>

29.   NEGOTIATED AGREEMENT

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

30.   COUNTERPARTS

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

31.   ENTIRE AGREEMENT

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

32.   NO WAIVER

      Any party's forbearance from exercising any claim or remedy provided for
      herein shall not be deemed a waiver of such claim or remedy, and shall not
      relieve the other Party from the performance of such obligation at any
      subsequent time or from the performance of any of its other obligations
      hereunder.

33.   REPRESENTATIONS AND WARRANTIES

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

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

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

<Page>

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

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

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

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

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

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

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

<Page>

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

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

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

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

[THE REMAINDER OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY]

<Page>

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

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

By:_____________________________             By: /s/ Frederick Simon
                                                 -----------------------------
Name: __________________________             Name:  Frederick Simon
                                                   ---------------------------
Title: _________________________             Title: President
                                                    --------------------------

By:_____________________________

Name: __________________________

Title: _________________________

Date:___________________________             Date: 6/17/98
                                                   ---------------------------
Place:__________________________             Place: Greenwich, CT
                                                    --------------------------
Witness:________________________             Witness: /s/ Arthur Amron
                                                      ------------------------
Name:___________________________             Name: Arthur Amron
                                                   ---------------------------

<Page>

--------------------------------------------------------------------------------
                     ATTACHMENT "A" WITH MODIFICATIONS FROM
                        AMENDMENT NO. 1, NO. 2 AND NO. 3
--------------------------------------------------------------------------------

                              NON OFFICIAL DOCUMENT
                                 REFERENCE ONLY

        AIRCRAFT SPECIFIC CONFIGURATION, FINISHING AND REGISTRATION MARKS

1.    STANDARD AIRCRAFT

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

2.    OPTIONAL EQUIPMENT

      2.1   OPTIONS TO THE STANDARD AVIONICS CONFIGURATION

            a)    CAT-II
            b)    2nd Radio Altimeter
            c)    2nd DME
            d)    2nd ADF
            e)    2nd Transponder Mode S
            f)    Selcal - Trimble
            g)    FMS/GPS - Honeywell
            h)    EGPWS
            i)    VHF (1st and 2nd) 8,33 khz spacing

      2.2   OPTIONAL SYSTEM / OTHER EQUIPMENT

            a.    Thrust Reversers
            b.    LR version
            c.    Cockpit Floodlight
            d.    External Painting (with capability to be reverted to polished)
            e.    Service Door Sill Protection
            f.    Cargo Door Sill Protection
            g.    Cargo Door Light
            h.    Wiring provision on the panel lamps for Filament Test
            i.    Structural provision for 10(degree)rudder deflection
            j.    Wiring provision for the nose landing gear door position
                  indication in the EICAS
            k.    Provision for warning of the selection of Flaps 22(degree)to
                  take-off
            l.    Provision for limitation of the hydraulic pressure on the
                  speed brake actuator when the aircraft is above 200 knots
            m.    Plug type passenger door

<Page>

                              NON OFFICIAL DOCUMENT
                                 REFERENCE ONLY

      2.3   INTERIOR OPTIONAL ITEMS

            a.    Interior Option 1
            b.    Audio Entertainment (CD player)
            c.    2nd Attendant kit (include Handset/Cradle)
            d.    Blue Sterile Light
            e.    Baggage Compartment Class C
            f.    Standard main door with structural provisions for plug type
                  door
            g.    Passenger Seats - Customized Cushion Version Top w/
                  Ultra-leather
            h.    Baggage Restraint Net
            i.    Extra Oxygen Mask (3 mask for each double seat)

3.    FINISHING

      a.    EXTERIOR FINISHING:

            The Aircraft shall be painted according to Buyer's or a Designated
            Operator's color and paint scheme which shall be supplied to Embraer
            by Buyer no later than six (6) months prior to the relevant Aircraft
            Contractual Delivery Date.

      b.    INTERIOR FINISHING:

            Buyer shall inform Embraer no later than seven (7) months prior to
            the relevant Aircraft Contractual Delivery Date of its choice of
            materials and colors of all and any item of interior finishing such
            as seat covers, carpet, floor lining on galley areas, side walls and
            overhead lining, galley lining and curtain. The above mentioned
            schedule for definition of interior finishing shall only be
            applicable if Buyer selects its materials from the choices offered
            by and available at Embraer. In case Buyer elects to use different
            materials and or patterns, such schedule shall be agreed between the
            Parties at the time of signature of this Purchase Agreement.

      If Buyer does not supply Embraer with the information in the time period
      as described in Article 3.a and 3.b, the Aircraft will be produced and
      will be made available for Buyer's inspection in the same condition of
      exterior and interior finishing as the first Aircraft.

4.    REGISTRATION MARKS

<Page>

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

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

<Page>

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

                                FERRY EQUIPMENT,
                   SPARE PARTS POLICY AND LIST OF PUBLICATIONS

1.    FERRY EQUIPMENT

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

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

      In such case, the original equipment shall become the property of Buyer,
      and the above mentioned payment shall be made to Embraer by Buyer upon
      presentation of a sight draft by Embraer.

      The presence of an Embraer qualified crew member during the ferry flight
      on the way to Buyer's facilities, to act as second in command to assist in
      handling communication with Air Traffic Control (ATC) while overflying
      Brazilian airspace up to the last stop within Brazilian territory, shall
      depend on previous agreement between the Parties provided that written
      advance notice shall be given from Buyer to Embraer at least thirty (30)
      days prior to the date of such ferry flight.

2.    SPARE PARTS

      2.0   POLICY

            Embraer's spare parts policy is to provide the following categories
            of spares as specified in the respective Embraer publications and
            available to be purchased through Embraer:

            o     Line Replaceable Units (LRU's);
            o     Parts to repair and overhaul components manufactured under
                  Embraer specification to be used only on the EMB-145 Aircraft;
            o     Parts to line maintenance;
            o     Parts to fulfill all maintenance tasks per maintenance manual
                  and/or maintenance plan issued by Embraer;

<Page>

            o     Embraer-made parts;
            o     Aircraft Ground Equipment (AGE);
            o     Aircraft Ground Equipment spare parts manufactured under
                  Embraer specifications;
            o     Special tools; and
            o     Bulk materials.

      2.1   INITIAL PROVISIONING

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

      2.2   PRE-PROVISIONING CONFERENCE

            If requested, Embraer will provide a qualified team to attend
            pre-provisioning conferences as necessary to discuss Buyer or a
            Designated Operator requirements and all points of the IPL. Such
            meeting shall be held at a mutually agreed upon time and place. On
            or before such pre-provisioning conference, Embraer shall provide
            Buyer with an initial list of recommended provisioning. Buyer and
            Embraer shall thereafter agree to the actual initial provisioning
            which shall be acquired by Buyer. For the first Firm Aircraft Buyer
            and Embraer shall agree on such initial provisioning on or before
            one hundred eighty (180) days prior to delivery of the first Firm
            Aircraft. For all other Aircraft to be delivered pursuant to this
            Agreement Buyer and Embraer shall agree on such initial provisioning
            on or before two hundred (200) days prior to delivery of each such
            Aircraft.

      2.3   DATA

            Initial provisioning data will be supplied to Buyer or a Designated
            Operator upon request.

            2.3.1 INITIAL PROVISIONING DATA: Embraer will supply initial
                  provisioning data within a time period to be mutually agreed
                  upon by both Party.

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

      2.4   SPARE PARTS RECOMMENDATIONS

<Page>

            Embraer will provide, if requested, a breakdown of recommended spare
            parts to support the components used during the Aircraft operation
            (inventory reprovisioning).

      2.5   DELIVERY OF SPARE PARTS

            Except for those spare parts referred to in item 2.4. above, Spare
            items (initial provisioning spare parts) are normally in inventory
            and available for delivery on the Aircraft Contractual Delivery
            Date. Nevertheless, delivery dates shall be those agreed between the
            Party in the relevant Purchase Agreement. Replenishment of Embraer
            made parts will be in accordance with the lead times quoted by
            Embraer. Embraer will deliver parts in FCA (Free Carrier - Incoterms
            1990) condition, at Sao Jose dos Campos, State of Sao Paulo, Brazil,
            or at any other port of clearance that may be chosen by Embraer and
            informed to Buyer.

      2.6   EMERGENCY SPARE PARTS SERVICE

            Embraer will maintain an emergency spare parts service, twenty four
            (24) hours a day, seven (7) days a week. Embraer will deliver in
            F.C.A. condition at Sao Jose dos Campos, State of Sao Paulo, Brazil,
            or at any other port of clearance that may be chosen by Embraer and
            informed to Buyer, spare parts in inventory needed for
            aircraft-on-ground (AOG) orders within twenty-four (24) hours after
            receipt. Embraer will notify Buyer (or Designated Operator) of the
            action taken to satisfy each emergency in accordance with the
            following schedule:

      --    AOG (Aircraft-on-Ground)                           within 4 hours
      --    Critical (imminent AOG or Work Stoppage)           within 24 hours
      --    Expedite (Less than published or quoted lead time) within 7 days

      2.7   CREDIT FOR SURPLUS SPARE PARTS

            Embraer offers to Buyer a "credit" program for certain surplus parts
            manufactured by Embraer and purchased according to the initial
            provisioning by Buyer and which were recommended in writing by
            Embraer limited to the quantities, part numbers and serial numbers
            (if applicable) identified in the relevant invoices. Such program
            will provide terms no less favorable than the following:

            2.7.1. Credit Program: During the period commencing four (4) years
                   after delivery of the first Aircraft under the initial
                   Purchase Agreement between Buyer and Embraer and ending five
                   (5) years after such delivery, Embraer will, upon receipt of
                   a written request and subject to the exceptions and
                   conditions in paragraphs 2.7.1.1; 2.7.1.2; 2.7.1.3 and
                   2.7.1.4. of this

<Page>

                   section, offer a credit for new and unused spare parts
                   manufactured by Embraer (i) which were ordered from Embraer
                   by Buyer as initial provisioning for Aircraft in accordance
                   with Embraer's recommendation; (ii) which have been supplied
                   by Embraer under this Agreement and (iii) which are surplus
                   to Buyer's needs. Such credit may be used toward the purchase
                   of spare parts manufactured by Embraer, Technical
                   Publications or Services offered by Embraer.

                   2.7.1.1.   EXCEPTIONS: Embraer will not issue credits for
                              spare parts which were purchased by Buyer in
                              excess to or differently from the parts
                              recommended in writing by Embraer to Buyer as
                              initial provisioning for the Aircraft and for
                              spare parts which have become obsolete or have
                              been superseded by another part as a result of (i)
                              Buyer's modification of an Aircraft for which the
                              spare parts were purchased; (ii) Embraer design
                              improvements (except for spare parts which have
                              become obsolete because of a defect in design);
                              (iii) parts which are shelf-life limited; (iv)
                              damaged parts; or (v) parts that were not properly
                              stored.

                   2.7.1.2.   CREDIT VALUES: The credit for each spare part to
                              be issued by Embraer will be: (i) an amount equal
                              to ninety percent (90%) of the invoice price of
                              the spare part paid to Embraer or (ii) an amount
                              equal to ninety percent (90%) of Embraer's price
                              for the equivalent spare part at the time of the
                              issue of credit, whichever is less.

                   2.7.1.3    DELIVERY OF SURPLUS SPARE PARTS: Spare parts for
                              which a credit has been requested shall be
                              redelivered by Buyer to Embraer with prepaid
                              freight and insurance to Embraer's plant in Sao
                              Jose dos Campos, SP, Brazil, or any other
                              destination as Embraer may reasonably designate.
                              All returned spare parts are subject to Embraer's
                              quality control inspection and acceptance. All
                              spare parts which are rejected by Embraer's
                              quality control and/or are included in the
                              exceptions set forth in paragraph 2.7.1.1
                              hereinabove, will be returned to Buyer at Buyer's
                              expense, no credit being due in this case.

<Page>

                   2.7.1.4    Credit Issue: After Embraer's acceptance of those
                              items suitable for the credit program, under the
                              terms of this Agreement, Embraer will notify the
                              available credit amount to Buyer and provide all
                              relevant information as to credit utilization.

      2.8.  PARTS EXCHANGE PROGRAM

            According to its prevailing availability, Embraer may offer an
            "exchange program" for repairable parts whenever the vendor does not
            have its own exchange program.

      2.9.  PARTS REPAIR PROGRAM

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

      2.10. PRICING

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

3.    LIST OF PUBLICATIONS

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

<Table>
<Caption>
                                                                   QTY
       TITLE                                                     (COPIES)
       -----                                                     --------
<S>                                                                  <C>
OPERATIONAL

1. [*]                                                               [*]
2. [*]                                                               [*]
3. [*]                                                               [*]
4. [*]                                                               [*]
5. [*]                                                               [*]
6. [*]                                                               [*]
7. [*]                                                               [*]
8. [*]                                                               [*]
</Table>

MAINTENANCE - BASIC SET

--------
* Confidential
<Page>

<Table>
<S>                                                                <C>
9.  [*]                                                            [*]
10. [*]                                                            [*]
11. [*]                                                            [*]
12. [*]                                                            [*]
13. [*]                                                            [*]
14. [*]                                                            [*]
15. [*]                                                            [*]
16. [*]                                                            [*]
17. [*]                                                            [*]
</Table>

MAINTENANCE SUPPLEMENTARY SET

<Table>
<S>                                                                <C>
18. [*]                                                            [*]
19. [*]                                                            [*]
20. [*]                                                            [*]
21. [*]                                                            [*]
22. [*]                                                            [*]
23. [*]                                                            [*]
24. [*]                                                            [*]
25. [*]                                                            [*]
26. [*]                                                            [*]
</Table>

      (*)   One extra copy on board each Aircraft
      (**)  To be delivered by the suppliers directly to Buyer.

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

----------
* Confidential
<Page>

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

                 WARRANTY CERTIFICATE - MATERIAL AND WORKMANSHIP

                                     EMB-145

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

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

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

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

      b.    For a period of twenty-four (24) months from the date of delivery of
            each Aircraft to the first Buyer, each Aircraft will be free from:

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

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

      Once the above mentioned periods have expired, Embraer will transfer to
      Buyer the original warranties issued by the vendors, if they still exist.

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

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

<Page>

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

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

      c.    Each Aircraft is composed entirely of vendor parts and parts
            manufactured by Embraer and Embraer subcontractors, and the parts
            manufactured by Embraer and Embraer subcontractors shall have
            Embraer part numbers.

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

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

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

<Page>

4.    Embraer will accept no warranty claims under any of the circumstances
      listed below unless it can be demonstrated in accordance with the
      standards of the international aircraft manufacturing industry that such
      operation or maintenance or other circumstance did not cause the defect:

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

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

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

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

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

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

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

6.    The warranty hereby expressed is established between Embraer and the first
      Buyer, and it cannot be transferred or assigned to others, unless by
      written consent of Embraer, or as otherwise provided for pursuant to
      Article 16 of the Purchase Agreement of which this is an Attachment or
      Article 9 hereof.

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

<Page>

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

      a.    ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS;

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

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

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

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

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

<Page>

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                                 ATTACHMENT "D"
--------------------------------------------------------------------------------

                                     EMB-145
                               ESCALATION FORMULA

                                       [*]

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* Confidential
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        [*]

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* Confidential
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        [*]

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                                 ATTACHMENT "E"
--------------------------------------------------------------------------------

                         DISPATCH RELIABILITY GUARANTEE

I.    Definitions

      a.    Available for Dispatch

            An Aircraft which is on the ground and cleared for dispatch by
            signature of the responsible maintenance personnel of the Specific
            Designated Operator, as defined in Article II.a of this Attachment
            E, at least half an hour before the scheduled departure time of the
            initial flight in any given day shall be deemed to be "available for
            dispatch".

      b.    Maintenance Interruption

            1.    A Maintenance Interruption occurs when the malfunction of an
                  item, or necessary checking and/or corrective actions, cause a
                  flight not to be available for dispatch, or a flight delay
                  exceeding 15 minutes.

            2.    A Maintenance Interruption of any or all the flight legs of a
                  multileg flight constitute only one interruption.

            3.    To be accounted as a Maintenance Interruption, any reported
                  malfunction, either verbal or written, must result in
                  maintenance corrective action.

            4.    A repetitive problem shall not be counted as a Maintenance
                  Interruption. However, chronic failures due to design defect
                  of Embraer-manufactured parts or vendor parts with Embraer
                  part numbers shall be counted as Maintenance Interruptions.

      c.    Achieved Dispatch Reliability Percentage ("ADR")

            Achieved Dispatch Reliability Percentage ("ADR") is the actual
            dispatch reliability percentage obtained by the specific Designated
            Operator's fleet of Aircraft in regular revenue service.

            [*]

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* Confidential
<Page>

                        [*]

II.   Embraer, subject to the conditions and limitations expressed in this
      Attachment E, will guarantee the Aircraft's dispatch reliability
      percentage as follows Aircraft:

      a.    This Dispatch Reliability Guarantee will be applicable only for
            Aircraft first operated by Chautauqua Airlines, Inc. (the "Specific
            Designated Operator") and only so long as the Aircraft are operated
            by the Specific Designated Operator.

      b.    The average ADR for the first 12 months period after commencement of
            commercial operations of the first Aircraft shall be [*]. The
            average ADR for the second 12 months period after commencement of
            commercial operations of the first Aircraft shall be [*]. The
            average ADR for the third 12 month period after commencement of
            commercial operations of the first Aircraft shall be [*] The
            average ADR for the fourth 12 month period after commencement of
            commercial operations of the first Aircraft (the "Final Period")
            shall be [*] (collectively "GDR").

      c.    In the event that the ADR any 12 month period referred to above is
            lower than GDR for the relevant period, Embraer shall diligently,
            after notification by Buyer:

            1.    Develop and offer modification kits to improve ADR under
                  conditions to be mutually agreed to by the Parties;

            2.    Make recommendations concerning Specific Designated Operator's
                  programs, publications and maintenance and operational
                  policies to improve ADR; and

            3.    Take all measures, as deemed necessary and appropriate by
                  Embraer when vendor action does not provide the required
                  improvement in the ADR.

      d.    In the event that the average ADR at the end of any twelve month
            period described in paragraph II.b. above is lower than the GDR for
            such period, Embraer shall credit BUYER for Maintenance
            Interruptions calculated according to the following formula:

            [*]

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* Confidential
<Page>

            In the event the average ADR at the end of any twelve month period
            described in paragraph II.b. above is greater than the GDR for such
            period, then the negative credit calculated according to the formula
            described above shall be carried over the calculation of the
            subsequent periods, in a cumulative way, in favor of Embraer.

            Buyer or Specific Designated Operator shall calculate measurements
            and submit them to Embraer within 60 days after the end of each
            12-month period referred to in Article II a. of this Attachment E.
            Embraer and Buyer shall attempt to reach an agreement over the data
            within 60 days of the submission. Any achieved credit amount will be
            credited to Buyer 30 days after the Final Period data conciliation.
            Such credit may be used by Buyer only toward future purchases of
            Embraer sold spare parts or technical publications or services
            offered by Embraer, excluding training.

      e.    This dispatch reliability guarantee is based upon the following
            assumptions provided by Specific Designated Operator, and any change
            to the assumptions shall be cause for reevaluation or adjustments of
            this guarantee in Embraer's sole discretion.

            UTILIZATION: [*]

      f.    The following elements are not covered under this guarantee:

            Interruptions of scheduled flights due to reasons other than
            Aircraft mechanical failures, including without limitation:

            -     Air Traffic Control

            -     Weather

            -     Acts of God (i.e. natural disasters, floods and earthquakes,
                  lightning strikes, bird strikes etc.).

            -     Accidents

            -     Incidents

            -     Negligence

            -     Force majeure

            -     Crew refusal

            -     Optional equipment other than that identified on Attachment
                  "A" to this Agreement

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* Confidential
<Page>

            -     Operational delays not related to maintenance

            -     Passenger and/or baggage loading

            -     Non-availability of spares or equipment, except when Buyer has
                  followed Embraer's I.P. and continuous reprovisioning
                  recommendations as provided for in paragraph II.e. hereof;

            -     Non-availability of personnel;

            -     Operation interruptions or Maintenance Interruptions which
                  could have been prevented if the Minimum Equipment List
                  ("MEL") issued and/or approved by the local regulatory
                  authority was followed

            -     If the FAA grounds Specific Designated Operator's fleet, or
                  one of Specific Designated Operator's Aircraft,

            -     Maintenance problems caused by Specific Designated Operator's
                  negligence or misuse of parts or Specific Designated
                  Operator's failure to take all maintenance actions on the
                  Aircraft as recommended in all applicable maintenance manuals

            -     Maintenance problems involving Aircraft or parts that has/have
                  been involved in an accident, or when parts either defective
                  or not complying to manufacturer's design or specification
                  have been used;

            -     Maintenance problems involving parts that have had their
                  identification marks, designation, seal or serial number
                  altered or removed

            -     Maintenance problem resulting from inadequate parking for
                  shipment and storage.

            -     Conditions that exist prior to dispatch which lead to a flight
                  interruption and could have been prevented by maintenance
                  prior to dispatch (including but not limited to worn, flat and
                  cut tires, servicing (ATA Chapter 12), hard landing, dead
                  batteries, and worn brakes).

III.  The foregoing dispatch reliability guarantee is provided subject to
      Specific Designated Operator's adherence in all material respects to the
      following general conditions:

      a.    Airplane Operation

            Aircraft shall be operated in airline service in accordance with FAA
            regulations and as recommended by Embraer through the official and
            most updated Operations and Airplane Flight Manual. Specific
            Designated Operator shall have available one spare aircraft for each
            twenty Aircraft at all times.

      b.    Inspection Program

            The Aircraft shall be maintained in accordance with the most current
            EMB-145 MRB document and using the "A" and "C" checks intervals
            Specific Designated Operator's program must have provisions for
            escalating the checks intervals as

<Page>

            soon as the FAA allows. Specific Designated Operator's program
            should also include the use of task cards to assist the maintenance
            personnel in performing inspection tasks.

      c.    Aircraft Manuals

            Specific Designated Operator shall keep a complete set of Embraer
            recommended manuals up-to-date and available to airline personnel
            for assisting them with the maintenance and operation of the
            Aircraft. A set of recommended manuals should be available at all
            maintenance bases (line or heavy) and shall be maintained with the
            latest revisions at all times.

      d.    MEL

            Specific Designated Operator shall keep its MEL up to date, with the
            most current issue.

      e.    Stocking Levels

            Specific Designated Operator shall stock and maintain Embraer and
            suppliers' reasonable recommended spare parts in inventory,
            throughout the guarantee period. There shall be a minimum inventory
            level at each line maintenance base along with the major parts being
            stored at the heavy maintenance facility. Embraer shall provide a
            list of recommended parts inventory to the Specific Designated
            Operator prior to delivery of the first Aircraft and within
            sufficient time for the Specific Designated Operator through Buyer
            to place an order with Embraer or the supplier. Specific Designated
            Operator shall annually provide an inventory list to Embraer which
            shows current stocking levels and the locations of all ERJ-145
            parts, and Embraer will then make any recommendations on additional
            inventory if needed.

      f.    Parts Repair

            All shop repairs shall be performed in FAA certificated and
            authorized repair shops.

      g.    Staff Levels

            Specific Designated Operator shall have available reasonable staff
            to properly maintain the Aircraft during scheduled and unscheduled
            maintenance. This shall include, but not be limited to, mechanics,
            electricians, avionics specialists, inspectors, cleaners, ground
            personnel and flight crews licensed or certified by the FAA as
            required by appropriate FAA regulations.

      h.    Training

            Specific Designated Operator shall put and keep in place a training
            program approved by the FAA, which, at a minimum, shall include the
            following items:

            1.    Initial and recurrent training for pilots in the Aircraft;

<Page>

            2.    Initial and recurrent training for flight attendants in the
                  Aircraft; and

            3.    Initial and recurrent training for the maintenance staff
                  (airframe, powerplant, electric avionics specialists) in the
                  Aircraft.

                  Any maintenance specialist (engine, APU, avionics) will
                  require suppliers' training.

                  Specific Designated Operator shall train to the above
                  standards any new hired employee who will work in or on the
                  Aircraft.

      i.    Aircraft Cleaning

            Specific Designated Operator shall keep the Aircraft reasonably
            clean, inside and out, by commercial airline standards at all times.
            This includes without limitation, the engines, wheel wells,
            nacelles, landing gear and flight control areas.

      j.    Service Bulletins

            When Embraer recommends that Specific Designated Operator implement
            a service bulletin which improves performance or dispatch
            reliability, enhances flight operations or decreases maintenance
            costs, without materially adversely impacting any of the foregoing,
            Embraer Customer Support Department shall contact Specific
            Designated Operator's Vice President of Maintenance, in writing,
            with recommendations that the service bulletin be complied with.
            Specific Designated Operator will schedule the Aircraft for
            incorporation of such service bulletin within three (3) months, but,
            subject to Embraer's agreement, may schedule it for incorporation
            during a maintenance check, so as to minimize interruption to
            scheduled service.

      k.    Ground Support Equipment

            Embraer shall provide Specific Designated Operator two lists of
            tooling and ground support equipment required to maintain the
            Aircraft which lists shall be subject to Specific Designated
            Operator's reasonable approval. One list will cover line maintenance
            bases while the other will apply to heavy maintenance facilities.
            Specific Designated Operator will be required to maintain these
            levels of required tooling and ground support equipment in good
            working order at all times.

      l.    Reliability Reporting

            Specific Designated Operator shall provide monthly to Embraer a
            complete Aircraft reliability report. This report shall include
            Aircraft total time and cycles, dispatch reliability, on-time
            performance, completion factor, pilot reports, schedule interruption
            description, and component removals. Shop finding reports and tear
            down reports (for each failure completed) by authorized agencies and
            SDR's with date, Aircraft registration, problem description,
            maintenance action, and part number and serial number of the
            components

<Page>

            removed and installed shall be maintained by the Designated Operator
            and shall be provided to Embraer as requested. Specific Designated
            Operator shall use the ATA 100 chapter breakdown format for all
            reports.

      m.    Rejection

            Specific Designated Operator shall not unreasonably reject Embraer's
            recommendations/changes/solutions which in Embraer's opinion, would
            result in an improvement in Specific Designated Operator's dispatch
            reliability. Any such rejection shall be cause for re-evaluation or
            adjustment of this guarantee in Embraer's sole discretion.

      n.    Certification or Regulatory Changes

            The achieved maintenance interruption shall not take into account
            those interruptions which were originated by conformity to mandatory
            regulatory change.

      o.    Achieved Dispatch Reliability Review Meeting

            An Achieved Dispatch Reliability Review Meeting shall be scheduled ,
            if necessary, and at the end of each six (6) month period of
            Specific Designated Operator's Aircraft operation. Representatives
            of Specific Designated Operator and Embraer shall participate in the
            meetings and will:

            1.    Review current Achieved Dispatch Reliability;

            2.    Eliminate irrelevant or non-Aircraft-intrinsic interruption
                  claims from computed cancellation rates; and

            3.    Review Specific Designated Operator's compliance with Service
                  Bulletins as required by Article III.j of this Attachment E,
                  review disputed claims, and consider methods for improvement
                  of Achieved Dispatch Reliability.

                  Specific Designated Operator shall permit Embraer access to
                  all of its data which can be used in understanding and
                  analyzing the dispatch reliability failure.

IV.   Suspension

      This guarantee shall be automatically suspended and shall not apply during
      the period of any labor disruption or dispute involving a significant work
      action which affects in whole or in part the Aircraft normal operation and
      maintenance.

V.    Specific Designated Operator will not include in the calculation of the
      ADR Maintenance Interruptions occurring under any of the circumstances
      listed below:

      a.    When the Aircraft has been used in an attempt to break records, or
            subjected

<Page>

            to experimental flights, or in any other way not in conformity with
            the flight manual or the airworthiness certificate, or subject to
            any manner of use in contravention of the applicable aerial
            navigation or other regulations or rules, issued or recommended by
            government authorities of whatever country in which the Aircraft is
            operated, when accepted and recommended by ICAO; and

      b.    When the Aircraft or any of its parts has/have been altered or
            modified by Specific Designated Operator, without prior approval
            from Embraer or from the manufacturer of the parts through a service
            bulletin, provided such approval has not been unreasonably withheld.

VI.   THE GUARANTEES, OBLIGATIONS AND LIABILITIES OF EMBRAER, AND REMEDIES OF
      BUYER SET FORTH IN THIS DISPATCH RELIABILITY GUARANTEE ARE EXCLUSIVE AND
      IN SUBSTITUTION FOR, AND BUYER HEREBY WAIVES, RELEASES AND RENOUNCES, ALL
      OTHER RIGHTS, CLAIMS, DAMAGES AND REMEDIES OF BUYER AGAINST EMBRAER OR ANY
      ASSIGNEE OF EMBRAER, EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE, WITH
      RESPECT TO ANY ACHIEVED DISPATCH RELIABILITY.

VII.  The terms and conditions of this dispatch reliability guarantee do not
      alter, modify or impair, in any way, the terms and conditions of
      Attachment C (EMB-145 Aircraft WARRANTY CERTIFICATE) to this Agreement.

VIII. The guarantee hereby expressed is established between Embraer and Buyer
      and it cannot be transferred or assigned to others, unless by previous
      written consent of Embraer.

IX.   As of condition of the guarantee hereby expressed, Specific Designated
      Operator shall execute a waiver consistent with Section VII of this
      Attachment E, in a form acceptable to Embraer.

<Page>

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                                 ATTACHMENT "F"
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                FORM OF APPOINTMENT OF AUTHORIZED REPRESENTATIVE

      ______________ ("Buyer") hereby designates and appoints _________________
as the authorized representative of Buyer for the purpose of inspecting,
reinspecting, and accepting delivery from EMBRAER-Empresa Brasileira de
Aeronautica S.A.("Embraer"), on behalf of and in the name of Buyer, of the
Embraer Model EMB-145 aircraft having Manufacturer's Serial No. 145___
(including the engines, appliances and parts installed thereon, the "Aircraft")
and Spares, as defined in that certain Purchase Agreement GCT-025/98 between
Buyer and Embraer dated June __, 1998, to be delivered by Embraer to Buyer
pursuant to the Purchase Agreement Assignment to be dated as of or about ______
__, 199__ between Solitair Corp. and Buyer, including the authority to accept
delivery of said Aircraft and Spares, and to execute and deliver any additional
documents with respect to the delivery for said Aircraft and Spares in such form
as such authorized representative executing the same shall deem appropriate.

Dated: __________ __, 199__

                                                 _______________________________

                                              By:_______________________________
                                                 Name:
                                                 Title:

The foregoing appointment
is hereby accepted

____________________________
Name:

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                                 ATTACHMENT "G"
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                          FORM OF WARRANTY BILL OF SALE

KNOW ALL MEN BY THESE PRESENT THAT Embraer - Empresa Brasileira de Aeronautica
S.A. ("SELLER"), a Brazilian company, whose address Av. Brigadeiro Faria Lima,
2170 - Putim, Sao Jose dos Campos, Sao Paulo, Brazil, is the owner of good and
marketable title to that certain EMB-145 LR Aircraft bearing Manufacturer's
Serial No. ___________, with all appliances, parts, instruments, appurtenances,
accessories, furnishings and/or other equipment or property incorporated in or
installed on or attached to said engine (hereinafter collectively referred to as
the "Aircraft") purchased by Solitair Corp. ("BUYER") under the Purchase
Agreement No. GCT-025/98, dated as of June __, 1998, including Attachments,
Exhibits, Letters, Amendments and Agreements by and between SELLER and BUYER.

THAT for and in consideration of the sum of US$ 10.00 and other valuable
consideration, receipt of which is hereby acknowledged, SELLER does this
__________ day of __________, 1998, grant, convey, transfer, bargain and sell,
deliver and set over to BUYER and unto its successors and assigns forever, all
of SELLER's rights, title and interest in and to the Aircraft.

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

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

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

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

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

Date as of ____________________, 1998.

EMBRAER - EMPRESA BRASILEIRA DE AERONAUTICA S.A.

By:    ___________________________
Name:  ___________________________
Title: ___________________________

<Page>

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                                 ATTACHMENT "H"
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                           FORM OF GUARANTY- ASSIGNEE

FOR VALUE RECEIVED, Solitair Corp., a corporation owned, managed, or effectively
controlled by Wexford Management LLC and organized under the laws of Delaware
("Guarantor"), pursuant to Article 16 b. of that certain Purchase Agreement
GCT-025/98 dated as of June __, 1998, among Solitair Corp. ("Buyer") and
EMBRAER-Empresa Brasileira de Aeronautica S.A. ("Embraer"), as the same may be
amended from time to time (the "Purchase Agreement"), does hereby
unconditionally and irrevocably guarantee to Embraer (i) the due and punctual
payment of each amount due and owing that ____(NAME)_____, as assignee of the
Purchase Agreement from Buyer ("Assignee"), is or may become obligated to pay
under and in accordance with the terms of the Purchase Agreement, and (ii) in
the event of any nonpayment, Guarantor agrees to immediately pay, or cause such
payment to be made, of such (such payment obligations of Assignee being herein
referred to as the "Obligations"). Guarantor further agrees to pay all
reasonable expenses (including, without limitations all reasonable fees and
disbursements of counsel) that may be paid or incurred in enforcing any rights
with respect to, or collecting, any or all of the Obligations and/or enforcing
any rights with respect to, or collecting against, Guarantor under this
Guaranty. The obligations of Guarantor to make any payments hereunder shall be
subject to the terms and conditions of the Purchase Agreement applicable to the
Obligations.

Capitalized terms used but not defined herein shall have the respective meanings
set forth in, and shall be construed and interpreted in the manner described in,
the Purchase Agreement.

Guarantor hereby waives notice of acceptance of this Guaranty, and agrees that,
in its capacity as a guarantor, it shall not be required to consent to, or to
receive any notice of, any supplement to or amendment of, or waiver or
modification of the terms of, the Purchase Agreement.

This Guaranty is being furnished to induce Embraer to execute an acknowledgement
of assignment of the Purchase Agreement to Assignee.

Guarantor represents and warrants that, as of the date hereof:

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

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

<Page>

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

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

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

f.    Each of the foregoing representations and warranties shall survive the
      execution and delivery of this Guaranty.

No failure or delay or lack of demand, notice or diligence in exercising any
right under this Guaranty shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right under this Guaranty.

This Guaranty is an absolute, unconditional and continuing guaranty of payment
and not of collection. Guarantor waives any right to require that any right to
take action against Assignee be exhausted or that resort be made to any security
prior to action being taken against Guarantor.

In the event that this Guaranty or the Purchase Agreement shall be terminated,
rejected or disaffirmed as a result of bankruptcy, insolvency, reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
proceedings with respect to Assignee, Guarantor's obligations hereunder to
Embraer shall continue to the same

<Page>

extent as if the same had not been so terminated, rejected or disaffirmed.
Guarantor shall and does hereby waive all rights and benefits that might , in
whole or in part, relieve it from the performance of its duties and obligations
by reason of any proceeding as specified in the preceding sentence, and
Guarantor agrees that it shall be liable for all sums guaranteed, in respect of
and without regard to, any modification, limitation or discharge of the
liability of Assignee that may result from any such proceedings and
notwithstanding any stay, injunction or other prohibition issued in any such
proceedings. Furthermore, the obligation of Guarantor hereunder will not be
discharged by: (a) any extension or renewal of any obligation of Assignee under
the Purchase Agreement; (b) any modification of, or amendment or supplement to,
any such Purchase Agreement; (c) any furnishing or acceptance of additional
security or any release of any security; (d) any waiver, consent or other action
or inaction or any exercise or non-exercise of any right, remedy or power with
respect to Assignee; (e) any change in the structure of the Assignee, any change
in ownership of the shares of capital stock of Guarantor or Assignee or any
merger or consolidation of either thereof into or with any other person; (f) any
assignment, transfer, sublease or other arrangement by which Assignee transfers
or loses control of the use of the Aircraft or any part thereof; or (g) any
other occurrence whatsoever, except payment in full of all amounts payable by
Assignee under the Purchase Agreement and performance in full of all the
Obligations in accordance with the terms and conditions of the Purchase
Agreement.

Guarantor understands and agrees that its obligations hereunder shall be
continuing, absolute and unconditional without regard to, and Guarantor hereby
waives any defense to, or right to seek a discharge of, its obligations
hereunder with respect to; (a) the validity, legality or enforceability of the
Purchase Agreement, any of the Obligations or any collateral security therefor
or guaranty or right of offset with respect thereto at any time or from time to
time held by Embraer; (b) any defense, setoff or counterclaim (other than a
defense of payment, performance (including payment or performance attributable
to a right of setoff provided for in the Purchase Agreement that may at any time
be available to or be asserted by Assignee) or breach by either party to the
Purchase Agreement until such breach is resolved under the terms of the Purchase
Agreement); or (c) any other circumstances whatsoever (with or without notice to
or knowledge of Assignee or Guarantor) that constitutes, or might be construed
to constitute, an equitable or legal discharge of Assignee or the Obligations,
or of Guarantor under this Guaranty, in bankruptcy or in any other instance.

Notwithstanding any payment or payments made by Guarantor hereunder or any set
off or application of funds of Guarantor by Embraer, Guarantor shall not be
entitled to be subrogated to any of the rights of Embraer against Assignee or
any collateral, security or guaranty or right of set off held by Embraer for the
payment of the Obligations, nor shall Guarantor seek or be entitled to seek any
reimbursement from Assignee in respect of payments made by Guarantor hereunder,
until all amounts and performance owing to Embraer by Assignee on account of the
Obligations are paid and performed in full. The obligations of Guarantor
hereunder shall be automatically reinstated if and to the extent that any
payment by or on behalf of Assignee in respect of any of the

<Page>

Obligations is rescinded or must be otherwise restored by any holder of any of
the Obligations as a result of any proceedings in bankruptcy or reorganization
or similar proceedings and Assignee agrees that it will reimburse such holders
on demand for all reasonable expenses (including, without limitation, all
reasonable fees and disbursements of counsel) incurred by such holders in
connection with such rescission or restoration.

Any provision of this Guaranty that 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, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

This Guaranty shall be binding upon the successors and assigns of Guarantor;
provided, that no transfer, assignment or delegation by Guarantor, other than a
transfer, assignment or delegation by operation of law, without the consent of
Embraer, shall release Guarantor from its liabilities hereunder. Subject to the
second preceding paragraph, this Guaranty shall terminate and be of no further
force and effect upon the performance and observance in full of the Obligations.

All notices, requests and demands to or upon Guarantor or any beneficiary shall
be mailed in accordance with the terms of Article 34 of the Purchase Agreement.
Guarantor hereby agrees to be bound as if it were the Assignee by the provisions
of Articles 20, 21, 23, and 25 of the Purchase Agreement, which are incorporated
herein by reference as if fully set forth herein.

Dated: _____ __,  199__

SOLITAIR CORP.

By:  _______________________________
     Name:
     Title:

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