Document:

<PAGE>

          CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED
             SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
                PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT

                                                                   Exhibit 10.18

                                  EMBRAER 190LR

                         PURCHASE AGREEMENT DCT-006/2003

                                     BETWEEN

                          EMBRAER - EMPRESA BRASILEIRA
                               DE AERONAUTICA S.A.

                                       AND

                         REGIONAL AIRCRAFT HOLDINGS LTD.

<PAGE>

                                      INDEX

<TABLE>
<CAPTION>
ARTICLE                                                            PAGE
-------                                                            ----
<S>                                                                <C>
1.  DEFINITIONS..................................................    3
2.  SUBJECT......................................................    5
3.  PRICE........................................................    5
4.  PAYMENT......................................................    6
5.  DELIVERY.....................................................    7
6.  CERTIFICATION................................................    7
7.  ACCEPTANCE AND TRANSFER OF OWNERSHIP.........................    8
8.  STORAGE CHARGE...............................................    9
9.  DELAYS IN DELIVERY...........................................    9
10. INSPECTION AND QUALITY CONTROL...............................   11
11. CHANGES......................................................   11
12. WARRANTY.....................................................   13
13. PRODUCT SUPPORT PACKAGE......................................   13
14. ASSIGNMENT...................................................   13
15. RESTRICTIONS AND PATENT INDEMNITY............................   13
16. MARKETING PROMOTIONAL RIGHTS.................................   14
17. TAXES........................................................   14
18. APPLICABLE LAW...............................................   14
19. JURISDICTION.................................................   14
20. TERMINATION..................................................   15
21. OPTION FOR THE PURCHASE OF ADDITIONAL AIRCRAFT...............   16
22. INDEMNITY....................................................   17
23. NOTICES......................................................   18
24. CONFIDENTIALITY..............................................   18
25. SEVERABILITY.................................................   19
26. NON-WAIVER...................................................   19
27. INTEGRATED AGREEMENT.........................................   19
28. NEGOTIATED AGREEMENT.........................................   19
29. WAIVER OF JURY TRIAL.........................................   19
30. WAIVER OF IMMUNITY...........................................   19
31. PAYMENTS IN US DOLLARS.......................................   20
32. COUNTERPARTS.................................................   20
33. ENTIRE AGREEMENT.............................................   20
</TABLE>

                                     Page 1

<PAGE>

                                   ATTACHMENTS

"A"   - AIRCRAFT SPECIFIC CONFIGURATION, FINISHING AND REGISTRATION MARKS
"B"   - FERRY EQUIPMENT AND PRODUCT SUPPORT PACKAGE
"C"   - WARRANTY CERTIFICATE - MATERIAL AND WORKMANSHIP
"D"   - PRICE ESCALATION FORMULA
"E"   - **Material Redacted**
"F"   - **Material Redacted**
"G"   - **Material Redacted**
"H"   - PERFORMANCE GUARANTEE

                                     Page 2

<PAGE>

                         PURCHASE AGREEMENT DCT-006/2003

THIS AGREEMENT IS ENTERED INTO THIS ____ DAY OF MAY, 2003, BY AND BETWEEN
EMBRAER - EMPRESA BRASILEIRA DE AERONAUTICA S.A. AND REGIONAL AIRCRAFT HOLDINGS
LTD., FOR THE PURCHASE AND SALE OF EMBRAER AIRCRAFT.

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 REGIONAL AIRCRAFT HOLDINGS LTD. 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 by the Parties and, unless otherwise expressly provided, the
      singular includes the plural, the masculine includes the feminine and
      neutral genders:

1.1  "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.

1.2  "AD's"                   shall mean Airworthiness Directives issued by
                              either the CTA or the Air Authority, in connection
                              with and with respect to the Aircraft.

1.3  "Agreement" or           shall mean this Purchase Agreement DCT-006/2003
     "Purchase Agreement"     together with all attachments, supplements and
                              exhibits hereto, all as modified and amended from
                              time to time.

1.4  "Air Authority"          shall mean the Autoridad de Aviacion Civil ("AAC")
                              of Panama, or a successor to the AAC from time to
                              time charged with the administration of civil
                              aviation in Panama.

1.5  "Aircraft Basic Price"   shall mean the Aircraft price, as defined in
                              Article 3.1.

1.6  "Aircraft Purchase       shall mean, in respect of an Aircraft, the
     Price"                   Aircraft Basic Price, escalated up to the
                              Contractual Delivery Date of such Aircraft in
                              accordance with and by application of the
                              Escalation Formula.

1.7  "Aircraft"               shall mean the EMBRAER 190LR aircraft
                              (certification designation ERJ 190-100 LR) (the
                              "EMBRAER 190 Aircraft"), manufactured by Embraer
                              according to the Preliminary Technical Description
                              PTD-190-Rev.3 dated November 2002, (which,
                              although not attached hereto, are incorporated
                              herein by reference) and the Aircraft Specific
                              Configurations, Finishing and Registration Marks
                              described in the Attachment "A", for sale to Buyer
                              pursuant to this Agreement, equipped with two
                              engines GE CF-34-10E5A1, manufactured by

                                     Page 3

<PAGE>

                              General Electric Company, all cases in the
                              condition and configuration required hereunder,
                              and shall include Firm Aircraft and Option
                              Aircraft unless the context requires otherwise.

1.8  "Buyer"                  shall mean Regional Aircraft Holdings Ltd., a
                              company with its address c/o Galindo, Arias y
                              Lopez, Avenida Federico Boyd Numero 51 Piso 11,
                              Panama, Rep of Panama.

1.9  "Business Day(s)"        shall mean a day other than a Saturday or Sunday
                              on which banks are open for business in Sao Jose
                              dos Campos, Sao Paulo, Rio de Janeiro, New York
                              and Panama.

1.10 "Contractual Delivery    shall mean the delivery date referred to in
     Date"                    Article 5.

1.11 "CTA"                    shall mean the Aerospace Technical Center of the
                              Brazilian Ministry of Aeronautics.

1.12 "Day(s)                  shall mean natural calendar day(s).

1.13 "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.

1.14 "Escalation Formula"     shall mean the escalation formula contained in
                              Attachment "D".

1.15 "Firm Aircraft"          shall mean the firm order Aircraft referred to in
                              Article 2.1

1.16 "Initial Deposit"        shall mean the initial non-refundable deposit
                              referred to in Article 4.1.1.

1.17 "Major Changes"          shall mean the changes to the design or approved
                              specification of the Aircraft, as defined in
                              Article 11.2.2.

1.18 "Mandatory Service       shall mean the service bulletins applicable to the
     Bulletins"               Aircraft, which are issued by Embraer to implement
                              the AD's referred to under Article 11.4.

1.19 "Minor Changes"          shall mean the changes to the design of the
                              Aircraft defined as per the terms and conditions
                              of Article 11.2.1.

1.20 "Option Aircraft         shall mean the unit price of the Option Aircraft,
     Basic Price"             as per the terms and conditions of Article 21.2.

1.20 "Option Aircraft         shall mean the initial deposit referred to under
     Initial Deposit"         Article 21.1.

1.21 "Option Aircraft         shall mean the Option Aircraft Basic Price
     Purchase Price"          escalated in accordance with and by application of
                              the Escalation Formulas **Material Redacted** as
                              per the terms and conditions of Article 21.3.

                                     Page 4

<PAGE>

1.22 "Option Aircraft"        shall be the additional Aircraft that Buyer shall
                              have the option to purchase as per the terms of
                              Article 21.

1.23 "Parties"                shall mean Embraer and Buyer.

1.24 "Product Support         shall mean the products and Services to be
      Package"                provided by Embraer as per Article 13.

1.25 "Scheduled Inspection    shall mean the date on which a certain Aircraft
      Date"                   hereunder is available for inspection and
                              acceptance by and subsequent delivery to Buyer, as
                              per the terms and conditions of Article 7.1.

1.26 "Services"               shall mean the familiarization and on-site support
                              for the Aircraft, part of the Product Support
                              Package, as specified in Attachment "B".

1.27 "Technical               shall mean the technical documentation pertaining
      Publications"           and related to the Aircraft as listed in Exhibit 1
                              to Attachment "B".

1.28 "USD" or "US$"           shall mean the legal currency of the United States
                              of America.

1.29 "Working Day(s)"         shall mean a day, other than Saturday, Sunday, or
                              holiday, on which Embraer in Sao Jose dos Campos,
                              SP, Brazil is open for business.

References to Articles or Attachments in the main body of this Purchase
Agreement shall be deemed to be references to Articles of or Attachments to this
Agreement, respectively, except as the context requires otherwise.

2.    SUBJECT

     Subject to the terms and conditions of this Agreement:

2.1   Embraer shall sell and deliver and Buyer shall purchase and take delivery
      of ten (10) Firm Aircraft;

2.2   Embraer shall provide to Buyer the Services and the Technical
      Publications; and

2.3   Buyer shall have the option to purchase up to twenty (20) Option Aircraft,
      in accordance with Article 21.

3.    PRICE

3.1   Buyer agrees to pay Embraer, in United States dollars, the Aircraft Basic
      Price of USD**Material Redacted** for each EMBRAER 190 Aircraft **Material
      Redacted**.

3.2   The Services and Technical Publications are to be provided **Material
      Redacted** to Buyer. Additional technical publications as well as other
      services shall be billed to Buyer in accordance with Embraer's rates
      prevailing at the time Buyer places a purchase order for such additional
      technical publications or other services.

3.3   The Aircraft Basic Price shall be escalated according to the Escalation
      Formula. Such price as escalated shall be the Aircraft Purchase Price and
      it will be provided to Buyer **Material Redacted** months prior to each
      Aircraft Contractual

                                     Page 5

<PAGE>

      Delivery Date.

4.    PAYMENT

4.1   The prices specified in the previous Article shall be paid by Buyer by
      wire transfer in immediately available United States dollars funds, to a
      bank account to be timely informed by Embraer to Buyer, as follows:

4.1.1 The Initial Deposit of **Material Redacted** per Aircraft is due and
payable **Material Redacted**.

4.1.2 A **Material Redacted** percent (**Material Redacted**%) **Material
Redacted** progress payment in respect of each Aircraft **Material Redacted** is
due and payable **Material Redacted** prior to the relevant Aircraft Contractual
Delivery Date, or upon the execution of this Agreement, whichever occurs later.

4.1.3 A **Material Redacted** (**Material Redacted**%) **Material Redacted**
progress payment in respect of each Aircraft **Material Redacted** is due and
payable **Material Redacted** prior to such relevant Aircraft Contractual
Delivery Date, or upon the execution of this Agreement, whichever occurs later.

4.1.4 A **Material Redacted** (**Material Redacted**%) **Material Redacted**
progress payment in respect of each Aircraft **Material Redacted** is due and
payable **Material Redacted** prior to each relevant Aircraft Contractual
Delivery Date, or upon the execution of this Agreement, whichever occurs later.

4.1.5 The balance of the Aircraft Purchase Price in respect of an Aircraft,
shall become due and payable upon acceptance of such Aircraft by Buyer.

4.2   Late Payments:

      In respect of any amounts which are or may become due and payable pursuant
      to Articles 4.1.1 through and including 4.1.4 which amounts are not paid
      within **Material Redacted** and payable as set forth in Article 4.1,
      interest shall accrue on the relevant amount at the rate of **Material
      Redacted** per annum (the "Default Rate") following the Due Date and
      ending on the date the relevant amount is received by EMBRAER In respect
      of accounts which may become due and payable pursuant to Article 4.1.5,
      interest shall accrue thereon at the rate set forth herein above. Without
      prejudice to Embraer's rights set forth in Article 4.3 below, interest
      accrued will be invoiced by Embraer on a monthly basis, beginning one
      month after **Material Redacted**, and payment thereof shall be made by
      Buyer in accordance with the instructions contained therein.

4.3   Termination for failure to make payments:

      Withoutprejudice to the payment of interest on late payments set forth
      above, should Buyer fail to make any payment on or before the due date,
      Embraer shall have the right, at its sole discretion, to either (i)
      postpone, the relevant Aircraft Contractual Delivery Date; or (ii)
      terminate this Agreement in relation to the affected Aircraft in
      accordance with Article 20.3, if such failure shall not have been cured
      within **Material Redacted** Days after the date on which Embraer has
      issued a written notice to Buyer of such failure.

4.4   Net payments:

4.4.1 All payments to be made by Buyer under this Agreement shall be made
without set-off or withholding whatsoever (except for Embraer Taxes, as defined
in Article 17). If

                                     Page 6

<PAGE>

Buyer is obliged by law to make any deduction or withholding from any such
payment (other than for Embraer Taxes), the amount due from Buyer in respect of
such payment shall be increased to the extent necessary to ensure that, after
the making of such deduction or withholding, Embraer receives a net amount equal
to the amount Embraer would have received had no such deduction or withholding
been required to be made.

4.5   Payment Date

      Unless otherwise agreed by the Parties in writing, payment of the amounts
      referred in Articles 4.1.2, 4.1.3, and 4.1.4 shall be made by Buyer on
      **Material Redacted** Day of the month on which each of such payments is
      due.

5.    DELIVERY

5.1   Aircraft: Subject to payment in accordance with Article 4 and the
      provisions of Articles 7 and 9, the Aircraft shall be tendered by Embraer
      to Buyer in the condition required hereunder, by means of a written
      notice, for inspection, acceptance and subsequent delivery in Fly Away
      Factory condition (i.e., Ex works (Incoterms 2000), with the Aircraft to
      be flown away by Buyer), at Sao Jose dos Campos, State of Sao Paulo,
      Brazil, according to the following schedule:

Aircraft Number                 Contractual Delivery Date
       1                       **Material Redacted**/2006
       2                          **Material Redacted**
       3                          **Material Redacted**
       4                          **Material Redacted**
       5                          **Material Redacted**
       6                          **Material Redacted**
       7                          **Material Redacted**
       8                          **Material Redacted**
       9                          **Material Redacted**
       10                      **Material Redacted**/2008

5.2 **Material Redacted**

6.    CERTIFICATION

6.1   By **Material Redacted**, the Embraer 190LR model aircraft shall be type
      certified by the Brazilian Airworthiness Authority (CTA) and type
      validated by (a) USA FAA in accordance with 14 CFR FAR 25 Amendment 25-84
      effective 10 July 1995 and (b) by the Airworthiness Authority of Panama
      ("AAC"), provided that **Material Redacted**.

6.2   The Aircraft shall be delivered to Buyer in conformity with **Material
      Redacted** and with the requirements set forth herein. Embraer will
      provide Buyer with an export certificate of airworthiness issued by CTA,
      which will certify that, as of the date of its issuance, the Aircraft has
      been inspected and found to conform in all respects to the CTA / AAC
      approved Type Design and in a condition **Material Redacted**. The
      condition of the Aircraft on delivery and the documentation delivered with
      the Aircraft, including the above mentioned export certificate of

                                     Page 7

<PAGE>

      airworthiness, shall **Material Redacted**. Subject to the above, it shall
      be Buyer's responsibility to obtain such certificate of airworthiness for
      and the registration of the Aircraft, at Buyer's sole expense. **Material
      Redacted**

7.    ACCEPTANCE AND TRANSFER OF OWNERSHIP

7.1   Unless Buyer is notified of any delay in delivery in accordance with and
      in conformity with the terms and conditions of this Agreement, the
      Aircraft shall be delivered in accordance with all of the provisions and
      schedules specified in Article 5 and otherwise in such condition as
      required under this Agreement. Embraer shall give Buyer **Material
      Redacted** Days advance facsimile notice of the date on which Embraer
      considers that each Aircraft will be ready for inspection, acceptance and
      subsequent delivery. Upon successful completion of ground and flight tests
      performed by Embraer, Buyer will receive a written confirmation of the
      Scheduled Inspection Date, on which date Buyer shall promptly start
      inspecting such Aircraft.

7.2   Buyer shall have up to **Material Redacted** Days, as necessary, to
      inspect and conduct an acceptance flight of each Aircraft prior to its
      delivery. Embraer will provide the fuel and insurance for the Aircraft's
      acceptance flight in accordance with Embraer insurance policy.

7.3   If Buyer finds an Aircraft acceptable, Buyer shall promptly pay any and
      all amounts then due and payable pursuant to this Agreement, including but
      not limited to all amounts referred to under Articles 4.1, 4.2, 7.8 and 8
      as applicable and accept delivery of such Aircraft, whereupon the
      necessary title and risk transfer documents shall be executed and
      exchanged in order to effect title transfer, subject to all express
      warranties set forth in this Agreement that by their terms survive
      delivery.

7.4   Buyer may decline to accept an Aircraft, which does not materially comply
      with the requirements of Article 6, the specification set forth in
      Attachment "A" or is not in an airworthy condition. For the purposes of
      **Material Redacted**, an Aircraft shall be deemed not to be materially
      compliant when one or more of the Aircraft characteristics identified in
      Article 11.2.1 **Material Redacted** are adversely affected by such
      non-compliance vis-a-vis the specification set forth in Attachment A.

7.5   If Buyer declines to accept an Aircraft, Buyer shall immediately give
      Embraer written notice including its reasons for such refusal and Embraer
      shall have **Material Redacted** Days, commencing on the first Working Day
      after receipt of such notice, to take all necessary actions in order to
      resubmit the Aircraft to Buyer for re-inspection.

7.6   Buyer shall be allowed **Material Redacted** Days to re-inspect the
      Aircraft, starting immediately upon receipt of notice from Embraer that
      all necessary actions were taken. The period required for inspection as
      well as the one mentioned in Article 7.5 shall not be considered as part
      of the **Material Redacted** Day grace period provided for in Article
      9.2.1. In the event Buyer declines to accept an Aircraft after **Material
      Redacted**, the Parties shall convene promptly after final refusal to
      accept the Aircraft in order to negotiate possible solutions. If within
      **Material Redacted** Days counted from the date in

                                     Page 8

<PAGE>

      which Embraer receives notice of such final refusal to accept the
      Aircraft, Embraer and Buyer fail to reach an agreement, then **Material
      Redacted**.

7.7   Should Buyer fail to perform the acceptance and accept transfer of title
      to an Aircraft **Material Redacted** provided for and in accordance with
      this Article 7, Embraer shall be entitled, at its reasonable discretion,
      to either re-negotiate the terms of this Agreement with Buyer or terminate
      this Agreement with regard to the affected Aircraft pursuant to Article
      20.3. **Material Redacted**

7.8   Notwithstanding the provisions of Article 7.7 and in addition to Embraer's
      rights pursuant to Article 20.3 and **Material Redacted** should Buyer
      fail to perform the acceptance and transfer of title to the Aircraft
      within the time period specified in Articles 7.2, 7.5 and 7.6, as
      applicable **Material Redacted**, interest will accrue at the rate of
      **Material Redacted** over the unpaid balance of the relevant Aircraft
      Purchase Price, prorated from the date **Material Redacted** Days after
      **Material Redacted**. Without prejudice to Embraer's rights set forth in
      Article 7.7, interest accrued will be invoiced by Embraer on a monthly
      basis, beginning one month after the date on which the Aircraft acceptance
      or transfer of title should have been performed, and payment thereof shall
      be made by Buyer in accordance with the instructions contained therein.

8.    STORAGE CHARGE

8.1   A storage charge equal to USD**Material Redacted** per Day shall be
      charged by Embraer to Buyer commencing on: 8.1.1 Buyer's failure to
      perform inspection or re-inspection of an Aircraft, per the date or time
      period properly specified in writing by Embraer, according to Articles 5
      and/or 7, as applicable.

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

8.1.3 Buyer's failure to remove an Aircraft from Embraer's facilities after
title transfer has occurred.

8.2   If however, Buyer notifies Embraer in writing **Material Redacted** Days
      in advance of its expected delay in the performance of its obligations set
      forth in Articles 8.1.1, 8.1.2 and 8.1.3, the storage charge shall
      commence on the **Material Redacted** Day after the occurrence of the
      events set forth in Articles 8.1.1, 8.1.2 or 8.1.3, as applicable.

8.3   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 Article 8.1, the storage
      charge shall commence on the **Material Redacted** Day after the
      Contractual Delivery Date relative to such Aircraft.

8.4   Buyer shall pay the storage charge as set forth in Articles 8.1. or 8.3,
      as applicable, in United States dollars, per each month of delay or
      prorated for part thereof, within **Material Redacted** Days after the
      presentation of each invoice by Embraer.

9.    DELAYS IN DELIVERY

                                     Page 9

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9.1   Excusable Delays:

9.1.1 Embraer shall not be held liable or be found in default for any delays in
the delivery of an Aircraft or in the performance of any act to be performed by
Embraer under this Agreement, resulting from, but not restricted to, the
following events or occurrences (hereinafter referred to as "Excusable Delays"):
(a) force majeure (including, but not limited to acts of God, war or state of
war, civil war, insurrection, fire, accident, explosion, flood, act of
government, requisition, strike, labor disputes causing cessation or
interruption of work, including but not limited to walkouts, sick-outs, protests
or slowdowns), (b) inability despite due and all commercially reasonable efforts
to procure any materials, equipment, accessories, parts or means of transport,
or (c) any delay resulting from any failure by Buyer to perform any action or
provide any information contemplated by this Agreement or, (d) delays resulting
from any other cause to the extent it is beyond Embraer's control or does not
result from Embraer's fault or negligence.

9.1.2 Within **Material Redacted** Days after the occurrence of any Excusable
      Delay, Embraer undertakes to send a written notice to Buyer including a
      description of the details involved and an estimate of the effects
      expected upon the timing of the performance of its contractual
      obligations.

9.1.3 Any such delays shall extend the time for delivery of an Aircraft
      **Material Redacted** by the same number of Days required for the cause of
      delay to be remedied, subject in all cases to the provisions of Article
      9.1.4. Embraer undertakes to use all commercially reasonable efforts to
      avoid or remove any cause of Excusable Delay and to minimize its effect on
      the Contractual Delivery Date of an Aircraft **Material Redacted**.

9.1.4 If the cause of such Excusable Delay is such as to last longer than
      **Material Redacted** Days or to render the performance of this Agreement
      impossible, then Buyer shall have the right to terminate this Agreement
      without liability to either Party, except as provided for in Article 20.2.

9.1.5 **Material Redacted**

9.2   Non-Excusable Delays:

9.2.1 If the delivery of an Aircraft is delayed for any reason that does not
      constitute an Excusable Delay (hereinafter a "Non-excusable Delay") by
      more than **Material Redacted** Days after the Contractual Delivery Date
      for such Aircraft, Buyer will be entitled to claim from Embraer and
      Embraer shall pay to Buyer liquidated damages equal to **Material
      Redacted** up to the date that the Aircraft is available for inspection
      and acceptance by, and delivery to Buyer in conformity herewith, it being
      understood that such liquidated damages will not, in any event, exceed
      **Material Redacted** and that it will only be due and payable by Embraer
      to Buyer within **Material Redacted** Days after Buyer pays to Embraer the
      total Aircraft Purchase Price, **Material Redacted**.

9.2.2 Upon the occurrence of any event, which constitutes a Non-excusable Delay
      in delivery of an Aircraft, Embraer undertakes to send a written notice to
      Buyer, within **Material Redacted**, including a description of the delay
      and an estimate of the effects expected upon the delivery of the Aircraft.

9.2.3 It is agreed between the Parties that if, with respect to a delayed
      Aircraft,

                                    Page 10

<PAGE>

      Embraer does not receive a claim for liquidated damages pursuant to
      Article 9.2.1, from Buyer, within **Material Redacted** Days after the
      Actual Delivery Date of such Aircraft, Buyer shall be deemed to have fully
      waived its right to such liquidated damages.

9.2.4 **Material Redacted**

9.3   Delay Due to Loss or Structural Damage of the Aircraft: Should any
      Aircraft be destroyed or damaged before acceptance to the extent that it
      becomes commercially useless, Buyer may, **Material Redacted**, either
      take a replacement Aircraft at a later delivery date to be agreed by the
      Parties, or terminate this Agreement with respect to such Aircraft by
      notice to Embraer given in accordance with Article 23, without any
      liability to either Party. If this Agreement is terminated **Material
      Redacted**, such termination shall discharge the Parties from all
      obligations and liabilities of the Parties hereunder with respect to such
      Aircraft and Services **Material Redacted**.

10.   INSPECTION AND QUALITY CONTROL

10.1  In order to effect inspection and acceptance of the Aircraft as set forth
      in Article 7, Buyer shall send one or more authorized representatives to
      Embraer's facilities in order to verify that the Aircraft was manufactured
      in accordance with the procedures, specifications and other requirements
      specified in this Agreement and according to all applicable quality
      control standards.

10.2  Buyer shall communicate to Embraer the names of its authorized
      representatives, by means of written notice, at least thirty (30) Days
      prior to the earliest delivery date specified in Article 5.

10.3  Such representatives, or other representatives indicated by Buyer, shall
      be authorized and duly empowered to sign the acceptance and documents and
      accept delivery of the Aircraft pursuant to Article 7.

10.4  For the purposes subject of this Article 10, Embraer shall provide
      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.

10.5  Buyer's authorized representatives shall observe Embraer's administrative
      rules and instructions while at Embraer's facilities.

10.6  Buyer's authorized representative shall be allowed exclusively in those
      areas related to the subject matter of this Article 10 and Buyer
      furthermore 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.

11.   CHANGES

11.1  In addition to the requirements of Article 6, each Aircraft will comply
      with the standards defined in Attachment "A" and shall incorporate all
      modifications which are classified as AD's mandatory by CTA or the Air
      Authority as provided in Article 11.4, or those agreed upon by Buyer and
      Embraer in accordance with this Article.

11.2  The Parties hereby agree that changes can be made by Embraer in the design
      of

                                    Page 11

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      the Aircraft, the definition of which and its respective classification
      shall be in compliance to the Aircraft type specification, as follows:

11.2.1 Minor Changes: defined as those modifications which shall not adversely
affect the Aircraft in any of the following characteristics:

      **Material Redacted**

11.2.2 Major Changes: defined as those modifications which affect at least one
of the topics mentioned in Article 11.2.1.

11.3  Embraer shall have the right, but not the obligation (except to the extent
      required by the CTA or applicable Aviation Authorities), to incorporate
      Minor Changes in the Aircraft still in the production line at its own
      cost, without the prior consent of Buyer.

11.4  Embraer shall convey those Major Changes that are classified as AD's by
      means of service bulletins approved by the Air Authority and/or CTA, as
      appropriate. Service bulletins that implement such ADs shall be referred
      to as Mandatory Service Bulletins. Embraer shall incorporate Mandatory
      Service Bulletins as follows:

11.4.1 Compliance required before Actual Delivery Date: Embraer shall
      incorporate Mandatory Service Bulletins at Embraer's expense in a
      reasonable period of time if the compliance time for such Mandatory
      Service Bulletins is before the Actual Delivery Date. Embraer shall not be
      liable for **Material Redacted** resulting from incorporation of Mandatory
      Service Bulletins when the Aircraft has already passed the specific
      production stage affected by the incorporation of said change.

11.4.2 Compliance required after Actual Delivery Date: During the applicable
      Aircraft warranty coverage periods as specified in Attachment "C", Embraer
      shall provide parts kits for Mandatory Service Bulletins that are issued
      either (i) before the relevant Aircraft's Actual Delivery Date but with a
      compliance time after such date or (ii) after the relevant Aircraft's
      Actual Delivery Date. Such kits shall be provided **Material Redacted**,
      excluding **Material Redacted** labor charges for installation of such
      Mandatory Service Bulletins **Material Redacted**. Embraer shall not be
      liable for any downtime of delivered Aircraft that may be necessary for
      the incorporation of any changes. When flight safety is affected, such
      changes shall be immediately incorporated. If warranty coverage is not
      available or applicable pursuant to Attachment "C", the provisions of
      Article 11.5 shall apply.

      For the avoidance of doubt, the **Material Redacted** shall **Material
      Redacted** pursuant to **Material Redacted**.

11.5  Major changes, (other than those which are AD's mandatory per Article
      11.4), any change developed by Embraer as product improvement and any
      change required by Buyer, including those changes required by Panamanian
      authorities as a consequence of alterations, amendments and/or innovations
      of its present applicable regulations, 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.

                                    Page 12

<PAGE>

11.6  Any Major Change to the Aircraft, made in accordance with the foregoing
      paragraphs, which affect the provisions of Attachment "A", shall be
      incorporated in said Attachment by means of an amendment.

11.7  Except as concerns AD's and Minor Changes, the Aircraft shall, on the
      Scheduled Inspection Date, comply with the terms and conditions of
      Attachment "A" as from time to time amended pursuant to Article 11.6.
      Determination of such compliance shall be made by Buyer pursuant to
      Article 7.

12.   WARRANTY

      The materials, design and workmanship relative to the Aircraft subject to
      this Agreement, will be warranted in accordance with the terms and
      conditions specified in Attachment "C". If Buyer intends to place the
      Aircraft on lease to another Party or to assign, transfer or novate the
      rights and obligations except as specified in Article 14, it is Buyer's
      responsibility to obtain the prior written consent of Embraer, which
      consent shall not be unreasonably withheld or delayed, as well as to
      provide Embraer written notice of any changes as to Buyer's designated
      lessee or assignee complying with item 5 of Attachment "C".

13.   PRODUCT

      SUPPORT PACKAGE Embraer shall supply to Buyer the Product Support Package
      described in Article 2 of Attachment "B", which includes Embraer's spare
      parts policy, the Technical Publications and the Services.

14.   ASSIGNMENT

      Buyer's rights and obligations hereunder may not be assigned, transferred
      or novated without the prior written consent of Embraer, which shall not
      be unreasonably withheld or delayed. Notwithstanding the foregoing, Buyer
      may immediately before delivery assign the rights to take delivery of an
      Aircraft and Buyer's rights pursuant to **Material Redacted** to any
      related person or entities or to any trust created by it or such persons
      or to any financing party whether by way of security in connection with
      the financing or the sale/leaseback of any Aircraft to be operated by
      Compania Panamena de Aviacion, S.A.

      Embraer's rights and obligations hereunder may not be assigned or
      delegated without the prior written consent of Buyer, which shall not be
      unreasonably withheld or delayed.

15.   RESTRICTIONS AND PATENT INDEMNITY

      This sale does not include the transfer of designs, copyrights, patents,
      and other similar rights to Buyer. Embraer warrants that the Aircraft and
      all systems, accessories, equipment, items and parts manufactured by or at
      the direction or utilizing designs of Embraer do not infringe any patent,
      copyright or other proprietary right of any person. Subject to Buyer's
      duty to promptly advise Embraer of any alleged infringement (it being
      understood that any failure to so notify Embraer shall only relieve
      Embraer of its obligations pursuant hereto to the extent of actual
      prejudice suffered by Embraer as a direct result of such failure), Embraer
      shall indemnify, defend, protect and hold Buyer harmless with respect to
      any claims, suits, actions, judgments, liabilities, damages and costs,
      including

                                    Page 13

<PAGE>

      reasonable attorney fees and expenses arising out of or in connection with
      any actual or alleged infringement by any Aircraft or any system,
      accessory, equipment, item or part installed on any Aircraft at the time
      of delivery of such Aircraft or thereafter, at Embraer's direction. In the
      event of any such infringement, and in addition to the foregoing
      obligations of Embraer, Embraer shall promptly, at its sole option and
      expense, either: (i) procure for Buyer the right to use the system,
      accessory or equipment or part; (ii) replace such system accessory,
      equipment or part with a non-infringing item or part; or (iii) modify such
      system, accessory, equipment or part to make it non-infringing. This
      indemnity shall not apply to Buyer-furnished equipment, nor to aircraft
      engines or APUs, nor to any system, accessory, equipment or part that was
      not manufactured to Embraer's detailed design, nor to any system,
      accessory, equipment or part manufactured to Embraer's detailed design
      without Embraer's consent.

16.   MARKETING PROMOTIONAL RIGHTS

      Embraer shall have the right to show for marketing purposes, free of any
      charge, the image of Buyer's Aircraft, painted with Buyer's colors and
      emblems, 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. **Material Redacted** Embraer **Material Redacted**. 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. 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. **Material Redacted**.

17.   TAXES

      Embraer shall pay all taxes **Material Redacted** as may be imposed under
      Brazilian laws. All other taxes, **Material Redacted** as may be imposed
      on the transactions subject of this Agreement, shall be borne by Buyer.

18.   APPLICABLE LAW

      This Agreement shall be construed in accordance with and its performance
      shall be governed by the laws of the State of New York, USA without regard
      to any conflict of law rules other than General Obligations Law 5-1401 and
      5-1402.

19.   JURISDICTION

      All disputes arising in connection with this Agreement shall be finally
      settled in the courts of the United States District Court for the Southern
      District of New York located in the county of New York, provided that if
      such court lacks jurisdiction, disputes shall be resolved in the state
      courts for the state of New York sitting in the Borough of Manhattan, City
      of New York. The Parties hereby waive any other court of Jurisdiction that
      may be competent for settlement of disputes arising from this Agreement.

                                    Page 14

<PAGE>

      **Material Redacted**

20.   TERMINATION

20.1  Should either Party fail to perform 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 **Material Redacted** 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
      **Material Redacted**. The foregoing provision shall not apply in any
      circumstance where a specific right of termination is made available
      hereunder or will be made available hereunder upon the expiration of a
      specific period of time. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS
      AGREEMENT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY IN ANY
      CIRCUMSTANCE UNDER THIS AGREEMENT FOR ANY CONSEQUENTIAL OR PUNITIVE
      DAMAGES WHICH MAY ARISE OUT OF, OR BE CONNECTED TO, ANY BREACH OR DEFAULT
      UNDER OF ANY TERM, CONDITION, COVENANT, WARRANTY, OR PROVISION OF THIS
      AGREEMENT, AND WHICH EITHER PARTY WOULD OTHERWISE BE ENTITLED TO UNDER ANY
      APPLICABLE LAW, INCLUDING BUT NOT LIMITED TO ANY CLAIMS SOUNDING IN
      CONTRACT, TORT, EQUITY OR STATUTE.

20.2  Buyer and Embraer shall have the right to terminate this Agreement in
      respect to the relevant Aircraft, upon the occurrence of any Excusable
      Delay of **Material Redacted** Days or longer, unless otherwise agreed in
      writing by the Parties, and Buyer shall have the right to terminate this
      Agreement in respect to the relevant Aircraft upon the occurrence of any
      Non-excusable Delay of **Material Redacted** Days or longer after the
      relevant Aircraft Contractual Delivery Date, such rights to be exercisable
      by written notice from one Party to the other to such effect no earlier
      than such **Material Redacted** Day, as applicable. Upon receipt of such
      notice of termination by Buyer or Embraer, as the case may be, **Material
      Redacted**. It is hereby agreed by the Parties that, in either case, no
      other indemnity shall be due by Embraer to Buyer. **Material Redacted**

20.3  If Buyer terminates this Agreement before the Actual Delivery Date of an
      Aircraft (except as provided in Article 20.1 and 20.2) or if Embraer
      terminates this Agreement in relation to an Aircraft, pursuant to Articles
      4.3 or 7.7, Buyer shall pay to Embraer (i) damages in an amount equal to
      **Material Redacted**. For these purposes Embraer may **Material
      Redacted**. It is hereby agreed by the Parties that upon the receipt by
      Embraer of the amounts set forth above, no other indemnity shall be due by
      Buyer to Embraer.
      **Material Redacted**

20.4  If Buyer terminates this Agreement in respect to an Aircraft pursuant to
      Article 7.6, Embraer, shall **Material Redacted**, with no other penalty
      or indemnity being due by Embraer to Buyer in this case.
      **Material Redacted**

20.5  **Material Redacted**

                                    Page 15

<PAGE>

21.   OPTION FOR THE PURCHASE OF ADDITIONAL AIRCRAFT

      Buyer shall have the option to purchase twenty (20) additional Option
      Aircraft, to be delivered in accordance with the following Option Aircraft
      contractual delivery date:

<TABLE>
<CAPTION>
 Option                            **Material     Option
Aircraft       Delivery month      Redacted**    Aircraft   Delivery month   Exercise Date
--------       --------------      ----------    --------   --------------   -------------
<S>        <C>                     <C>           <C>        <C>              <C>
   1       **Material Redacted**   **Material       12        **Material      **Material
                                   Redacted**                 Redacted**      Redacted**
   2       **Material Redacted**                    13        **Material
                                                              Redacted**
   3       **Material Redacted**   **Material       14        **Material
                                   Redacted**                 Redacted**
   4       **Material Redacted**                    15        **Material      **Material
                                                              Redacted**      Redacted**
   5       **Material Redacted**   **Material       16        **Material
                                   Redacted**                 Redacted**
   6       **Material Redacted**                    17        **Material
                                                              Redacted**
   7       **Material Redacted**                    18        **Material      **Material
                                                              Redacted**      Redacted**
   8       **Material Redacted**                    19        **Material
                                                              Redacted**
   9       **Material Redacted**   **Material       20        **Material
                                   Redacted**                 Redacted**
  10       **Material Redacted**
  11       **Material Redacted**
</TABLE>

The Option Aircraft will be supplied in accordance with the following terms and
conditions:

21.1  **Material Redacted** is due and payable by Buyer to Embraer in accordance
      with **Material Redacted**.

21.2  The unit basic price of the Option Aircraft shall be equal to the unit
      Aircraft Basic Price, provided that such Option Aircraft be delivered
      within the delivery period above mentioned and in the same configuration,
      specification and installations specified in Attachment "A", as it is
      written on the date of signature of this Agreement, determining the Option
      Aircraft Basic Price.

21.3  The unit basic price of each relevant Option Aircraft above mentioned
      shall be escalated according to the escalation formula subject of
      Attachment "D", determining the Option Aircraft Purchase Price.

21.4  The payment of the Option Aircraft Purchase Price shall be made according
      to the

                                    Page 16

<PAGE>

      following:

21.4.1 **Material Redacted** shall apply **Material Redacted**.

21.4.2 A progress payment of **Material Redacted** percent (**Material
      Redacted**%) of the unit Option Aircraft Basic Price less the relevant
      Option Aircraft Initial Deposit is due and payable **Material Redacted**
      prior to each relevant Option Aircraft contractual delivery date.

21.4.3 A progress payment of **Material Redacted** percent (**Material
      Redacted**%) of the unit Option Aircraft Basic Price is due and payable
      **Material Redacted** prior to each relevant Option Aircraft contractual
      delivery date.

21.4.4 A progress payment of **Material Redacted** percent (**Material
      Redacted**%) of the unit Option Aircraft Basic Price is due and payable
      **Material Redacted** prior to each relevant Option Aircraft contractual
      delivery date.

21.4.5 The balance of each relevant Option Aircraft Purchase Price is due and
      payable upon acceptance of each relevant Option Aircraft by Buyer.

21.4.6 The provisions of Article 4.3 through 4.5 shall apply mutatis-mutandis,
      to the payments to be made by Buyer towards the Option Aircraft.

21.5  Buyer has the option to purchase the Option Aircraft in **Material
      Redacted**. Exercise of each **Material Redacted** shall be accomplished
      by means of a written notice from Buyer delivered to Embraer by mail,
      return receipt requested, express delivery or facsimile, no later than the
      "Exercise Date" **Material Redacted**, otherwise **Material Redacted**. On
      the **Material Redacted** Exercise Date, Buyer shall inform Embraer
      **Material Redacted** will be exercised or not. In the event on the
      Exercise Date Buyer elects to not exercise **Material Redacted**, Buyer's
      options **Material Redacted**. If, however, in the Exercise Date Buyer
      elects to exercise its option in **Material Redacted**, Buyer will
      **Material Redacted**, provided however **Material Redacted** in Embraer's
      **Material Redacted**.

21.6  If the options are confirmed by Buyer as specified above, (a) an amendment
      to this Agreement shall be executed by and between the Parties within
      thirty (30) Days following the Option Aircraft option exercise date,
      setting forth the terms and conditions applicable to, if any, exclusively
      to the Option Aircraft and (b) the **Material Redacted** shall **Material
      Redacted**.

21.7  For the avoidance of any doubt, the terms and conditions contained in this
      Agreement shall also apply to any exercised Option Aircraft, with the
      exception that the product support package to be applied to the exercised
      Option Aircraft shall be as described in Article 2 of Attachment "B".

22.   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

                                    Page 17

<PAGE>

      person 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,
      including, but not limited to, technical operations, maintenance, and
      training services and assistance performed while on the premises of
      Embraer or Buyer, while in flight on Buyer-owned Aircraft or while
      performing any other service, at any place, in conjunction with the
      Aircraft operations of Buyer, except to the extent caused by Embraer's
      willful misconduct or gross negligence.

23.   NOTICES

      All notices permitted or required hereunder shall be in writing in the
      English language and sent, by recognized international courier service or
      facsimile, to the attention of the Director of Contracts as to Embraer and
      of the CEO as to Buyer, to the addresses indicated below or to such other
      address as either Party may, by written notice, designate to the other.
      All notices shall be deemed to have been duly made, given and received,
      only when properly addressed (as set forth below): (i) on the date
      received by personal delivery; or (ii) on the date received when deposited
      with a internationally recognized courier service; or (iii) five business
      days after sending, when sent via Certified Mail, Return Receipt Request;
      or (iv) upon receipt when sent via facsimile (with a second copy sent via
      Mail) to the facsimile number set forth below and a confirmation of
      receipt is received by the sending Party:

23.1  EMBRAER:

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

23.2  BUYER:

        REGIONAL AIRCRAFT HOLDINGS LTD.
        c/o Galindo, Arias y Lopez
        Avenida Federico Boyd Numero 51 Piso 11
        Panama, Rep of Panama
        Fax:  507-263-5335

24.   CONFIDENTIALITY

      Neither Buyer nor Embraer shall disclose the terms of this Agreement
      except as needed to its officers, employees, auditors, insurers (brokers)
      and legal advisors and except (a) as required by law or legal process, (b)
      to a prospective financing party in connection with the financing of
      Aircraft (limited to assignable provisions), or (c) with the prior written
      consent of the other party. In addition, Buyer and Embraer may disclose
      the terms of this Agreement to shareholders who hold more than ten percent
      (10%) of their respective common shares, provided that (i)

                                    Page 18

<PAGE>

      such shareholders are not, in the case of Buyer, competitors or affiliates
      of competitors of Embraer in the business of manufacturing aircraft, or in
      the case of Embraer, competitors or affiliates of competitors of Compania
      Panamena de Aviacion, S.A. in the business of a scheduled airline, and
      (ii) such shareholders, to the extent not officers of a Party shall have
      executed a confidentiality agreement with the other Party. Without
      limiting the foregoing, in the event either Party is legally required to
      disclose the terms of this Agreement, each Party agrees to exert its best
      efforts to request confidential treatment of the articles and conditions
      of this Agreement relevantly designated by the other as confidential.

25.   SEVERABILITY

      If any provision or part of a provision of this Agreement or any of the
      Attachments shall be, or be found by any authority or court of competent
      jurisdiction to be, illegal, invalid or unenforceable, such illegality,
      invalidity or unenforceability shall not affect the other provisions or
      parts of such provisions of this Agreement, all of which shall remain in
      full force and effect.

26.   NON-WAIVER

      Except as otherwise specifically provided to the contrary in this
      Agreement, any Party's refrain 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.

27.   INTEGRATED AGREEMENT

      All attachments and exhibits referred to or delivered in connection with
      this Agreement and/or attached hereto are, by such reference or
      attachment, incorporated in this Agreement to the same extent as if fully
      set forth herein.

28.   NEGOTIATED AGREEMENT

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

29.   WAIVER OF JURY TRIAL

      EACH OF EMBRAER AND BUYER HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL
      PROCEEDING TO WHICH THEY ARE BOTH PARTIES INVOLVING, DIRECTLY OR
      INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE)
      IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT.

30.   WAIVER OF IMMUNITY

      To the extent that either party may in any jurisdiction in which
      proceedings may at any time be taken for the determination of any question
      arising under or for the enforcement of this Agreement be entitled to
      claim or otherwise be accorded for itself or its respective property,
      assets or revenues immunity fro suit or attachment (whether in aid of
      execution, before judgment or otherwise) or other legal process, and to
      the extent that in any such jurisdiction, there may be

                                    Page 19

<PAGE>

      attributed to either party, or its respective property, assets or revenues
      such immunity (whether or not claimed), both Parties hereby irrevocably
      agree not to claim and waive such immunity to the fullest extent permitted
      by the law of such jurisdiction.

31.   PAYMENTS IN US DOLLARS

      All amounts to be paid hereunder shall be paid in United States dollars
      ("Dollars"), in immediately available funds. The specifications of Dollars
      in this transaction is of the essence. The obligations of either party in
      respect of payments to be made hereunder shall not be discharged by an
      amount paid in another currency, whether pursuant to a judgment or
      otherwise, to the extent that the amount so paid on prompt conversion to
      Dollars under normal banking procedures does not yield the amount of
      Dollars owing to the party receiving the same. If a party receives an
      amount in respect of the other party's liability under this Agreement or
      if such liability is converted into a claim, proof, judgment or order in a
      currency other than Dollars, the party liable for payment will indemnify
      the party to whom payment is to be made an in independent obligation
      against any loss arising out of or as a result of such receipt or
      conversion. If the amount received by such party, when converted into
      Dollars (at the market rate at which the receiving party is able on the
      relevant date to purchase Dollars in New York with that other currency) is
      less than the amount owed in Dollars the party liable for such payment
      hereunder will, forthwith on demand, pay to the party entitled to receive
      such payment an amount in Dollars equal to the deficit.

32.   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.

33.   ENTIRE AGREEMENT

      This Agreement constitutes the entire agreement of the Parties with
      respect to the matters contained herein and supersedes all previous and
      connected negotiations, representations and agreements between the
      Parties, whether in writing or other form. This Agreement may not be
      altered, amended or supplemented except by a written instrument executed
      by the Parties.

                                    Page 20<PAGE>

          CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED
         SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT
                    TO A REQUEST FOR CONFIDENTIAL TREATMENT

                                                                   Exhibit 10.19

                          LETTER AGREEMENT DCT-007/2003

                                      INDEX

<TABLE>
<S>                                                                     <C>
1 -- START-UP TEAM:...................................................  1
2 -- AEROCHAIN........................................................  2
3 -- **Material Redacted**............................................  3
4 -- **Material Redacted**............................................  3
5 -- SPARE PARTS CREDIT...............................................  3
6 -- **Material Redacted**............................................  3
7 -- AIRCRAFT CONVERSION..............................................  3
8 -- ESCALATION CAP...................................................  3
9 -- **Material Redacted**............................................  3
10 -- COMPUTER BASED TRAINING.........................................  3
11  - **Material Redacted**...........................................  3
12 -- APPLICABLE LAW..................................................  3
13 -- JURISDICTION....................................................  3
14 -- CONFIDENTIALITY.................................................  4
15 -- SEVERABILITY....................................................  4
16 -- NON-WAIVER......................................................  4
17 -- NEGOTIATED AGREEMENT............................................  4
18 -- COUNTERPARTS....................................................  4
</TABLE>

EXHIBITS:

"1" - SPECIAL INSURANCE CLAUSES
"2" - **Material Redacted**
"3A" - **Material Redacted**
"3B" - **Material Redacted**

<PAGE>

This Letter Agreement DCT-007/2003 ("Agreement" or "Letter Agreement") dated May
__, 2003 is an agreement between Regional Aircraft Holdings Ltd. ("Buyer") with
its address c/o Galindo, Arias y Lopez, Avenida Federico Boyd Numero 51 Piso 11,
Panama, Rep of Panama, and EMBRAER - Empresa Brasileira de Aeronautica S.A.
("Embraer" or "Embraer-Brazil"), with its principal place of business at Sao
Jose dos Campos, SP, Brazil (collectively the "Parties"), relating to Purchase
Agreement DCT-006/2003 (the "Purchase Agreement") dated as of May __, 2003.

This Letter Agreement constitutes an amendment, supplement and modification of
the Purchase Agreement as it sets forth additional agreements of the Parties
with respect to the matters set forth therein. All terms defined in the Purchase
Agreement shall have the same meaning when used herein, and in case of any
conflict between this Letter Agreement and the Purchase Agreement, this Letter
Agreement shall prevail.

WHEREAS:

a)    The Parties have entered into the Purchase Agreement, pursuant to, and
      subject to the terms and conditions of, which Buyer shall buy and Embraer
      shall sell ten (10) Firm Aircraft and up to twenty (20) Option Aircraft.

b)    The Parties wish to set forth the additional agreements of the Parties
      with respect to certain matters related to the purchase of the above
      referenced aircraft.

NOW, THEREFORE, for good and valuable consideration, the Parties agree as
follows:

1 -- START-UP TEAM:

      Embraer shall provide a start-up team to take place at the initial line
      operation of the first Aircraft, composed of the following individuals:

      -     **Material Redacted** for 30 **Material Redacted** days **Material
            Redacted**.

      -     **Material Redacted** for **Material Redacted** days.

      The sole purpose of these specialists is to advise and assist with Buyer's
      start-up operations of the Aircraft, making **Material Redacted** familiar
      with the operation and maintenance of the Aircraft. Embraer shall at its
      sole criteria indicate the individuals that will compose the start-up
      team, and Embraer shall be able to replace at any time any of such
      individuals **Material Redacted**. The start-up team is in addition to the
      pilot and mechanic training, and to the Field Support Representative
      specified in Article 2.3.2 of Attachment B to the Purchase Agreement.

      Embraer **Material Redacted** shall not be authorized to perform any
      direct flight or maintenance services on Buyer's Aircraft.

      Without a previous written authorization from Embraer, an Embraer's
      **Material Redacted** shall not **Material Redacted**. In case Buyer
      obtains such Embraer's previous authorization, Buyer shall include Embraer
      as additional insured in the Comprehensive Airline Liability insurance
      policies carried by Buyer, without recourse against Embraer for any
      failure, act or omission of Embraer's pilots or mechanics while rendering
      the services set forth in this Paragraph, in such a manner as to

                                     Page 1

<PAGE>

      cover any and all risks arising from or in any way connected with such
      services. Buyer shall also supply Embraer with a copy of the endorsements
      to the insurance policies above mentioned, in accordance with the clauses
      contained in Exhibit "1" to this Agreement, within **Material Redacted**
      prior to the date on **Material Redacted** as indicated above. For the
      avoidance of doubt, the indemnity provided in Article 22 of the Purchase
      Agreement shall apply to the services set forth in this Section 1.

      Embraer reserves the right to halt the services mentioned in this Section
      1, should any of the following situations occur at Buyer's base: a) there
      is a labor dispute or work stoppage in progress; b) war or war like
      operations, riots or insurrections; c) any conditions which is dangerous
      to the safety or health of Embraer's employee; or d) the government of
      Buyer's country refuses permission to Embraer's employee to enter the
      country.

      At no charge to Embraer, Buyer shall provide the start-up team members
      with communication facilities (telephone, facsimile) as well as office
      space and facilities at Buyer's main base, and Buyer shall also (a)
      arrange all necessary work permits and airport security clearances
      required for Embraer's team members, to permit the accomplishment of the
      services mentioned in this Article 1, in due time; and (b) obtain all
      necessary custom clearances both to enter and depart from Buyer's country
      for Embraer's team members and their personal belongings and professional
      tools.

      The start-up team members shall be allowed exclusively in those areas
      related to the subject matter hereof and Embraer agrees to hold harmless
      Buyer from and against all and any kind of liabilities in respect of such
      team members to the extent permitted by law, **Material Redacted**. Buyer
      shall bear all **Material Redacted**.

      At no charge to Embraer, Buyer shall provide **Material Redacted**.

2 -- AEROCHAIN

      Aerochain (www.aerochain.com) is an electronic marketplace that provides
      value-added after-sales services and extended supply chain collaboration,
      focused on the aerospace community. Aerochain site is composed of
      following sections:

      -     Community: A set of tools to promote interactivity among users,
            through services as Alerts and Newsletters.

      -     Trading: Buy & Sell solution for suppliers and customers to realize
            reduction in maintenance, material and operation cost. Embraer
            operators can access the Material Support Back Office System, and
            get information regarding sales of spare parts.

      -     Supply Chain: Collaborative planning function to provide means to
            quickly and interactively develop inventory plans based on
            information shared by trading partners.

      -     Maintenance & Operations: Tools for maintenance management and fleet
            configuration tracking to simplify the administration of either a
            large or small fleet.

      -     Technical Services: Here is available the Embraer customer service
            support

                                     Page 2

<PAGE>

            previously found at CIS (Customer Integration System). Embraer
            Operators will find useful information on airworthiness and flight
            safety, technical support, operations, reliability, maintenance
            cost, maintenance planning and training. A Technical Publications
            Library is also available to search, view and download, conditioned
            to Buyer having a Technical Publications Revision Service contracted
            with Embraer. The use of publications obtained from this site is
            subject to prior approval of the relevant airworthiness authorities.

      Access to these features is conditioned to the execution of a User
      Agreement. If the User Agreement is not signed by Buyer and Aerochain by
      the date **Material Redacted** prior to the first Firm Aircraft
      Contractual Delivery Date **Material Redacted**, Embraer will cause
      Aerochain to provide Buyer **Material Redacted** access to the Technical
      Service module (previously named CIS) for the **Material Redacted**
      following**Material Redacted**, provided that **Material Redacted**.

3 -- **MATERIAL REDACTED**

4 -- **MATERIAL REDACTED**

5 -- SPARE PARTS CREDIT

      Embraer will provide Buyer a spare parts credit of USD**Material
      Redacted** per each of the Firm Aircraft **Material Redacted** effectively
      delivered to Buyer. The Spare parts credit shall be used by Buyer for the
      purchase of Embraer-made spare parts and ground support equipment from the
      Embraer - Brazil spare parts facility (except for engines, engine related
      parts and APU), on a mutually agreed delivery schedule. **Material
      Redacted** To be eligible to utilize such credit, Buyer shall not be in
      default in respect of any payment that has become due and payable by Buyer
      to Embraer or an affiliate of Embraer (as per the terms of the relevant
      agreement or invoice). Spare parts credits made available to Buyer will
      expire, if not used, **Material Redacted** year from **Material
      Redacted**.

6 -- **MATERIAL REDACTED**

7 -- **MATERIAL REDACTED**

8 -- **MATERIAL REDACTED**

9 -- **MATERIAL REDACTED**

10 -- **MATERIAL REDACTED**

11 -- **MATERIAL REDACTED**

12 -- APPLICABLE LAW

      This Agreement shall be construed in accordance with and its performance
      shall be governed by the laws of the State of New York, USA without regard
      to any conflict of law rules other than General Obligations Law 5-1401 and
      5-1402.

13 -- JURISDICTION

      All disputes arising in connection with this Agreement shall be finally
      settled in the courts of the United States District Court for the Southern
      District of New York

                                     Page 3

<PAGE>

      located in the county of New York, provided that if such court lacks
      jurisdiction, disputes shall be resolved in the state courts for the state
      of New York. The Parties hereby waive any other court of Jurisdiction that
      may be competent for settlement of disputes arising from this Agreement.
      **Material Redacted**

14 -- CONFIDENTIALITY

      Notwithstanding anything to the contrary in the Purchase Agreement,
      neither Buyer nor Embraer shall disclose the terms of this Agreement
      except as needed to its officers, employees, auditors, insurers (brokers)
      and legal advisors and except (a) as required by law or legal process or
      (b) to a prospective financing party in connection with the financing of
      Aircraft (limited to assignable provisions), or (c) with the prior written
      consent of the other party. In addition, Buyer and Embraer may disclose
      the terms of this Agreement to shareholders who hold more than ten percent
      (10%) of their respective common shares, provided that (i) such
      shareholders are not, in the case of Buyer, competitors or affiliates of
      competitors of Embraer in the business of manufacturing aircraft, or in
      the case of Embraer, competitors or affiliates of or affiliates of
      competitors of Compania Panamena de Aviacion, S.A. in the business of a
      scheduled airline, and (ii) such shareholders, to the extent not officers
      of a Party shall have executed a confidentiality agreement with the other
      Party. Without limiting the foregoing, in the event either Party is
      legally required to disclose the terms of this Agreement, each Party
      agrees to exert its best efforts to request confidential treatment of the
      Articles and conditions of this Agreement relevantly designated by the
      other as confidential.

15 -- SEVERABILITY

      If any provision or part of a provision of this Letter Agreement or any of
      the Attachments shall be, or be found by any authority or court of
      competent jurisdiction to be, illegal, invalid or unenforceable, such
      illegality, invalidity or unenforceability shall not affect the other
      provisions or parts of such provisions of this Letter Agreement, all of
      which shall remain in full force and effect.

16 -- NON-WAIVER

      Except as otherwise specifically provided to the contrary in this
      Agreement, any Party's refrain 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.

17 -- NEGOTIATED AGREEMENT

      Buyer and Embraer agree that this Agreement has been the subject of
      discussion and negotiation and is fully understood by the Parties, and
      that the rights, obligations and other mutual agreements of the Parties
      contained in this Agreement are the result of such complete discussion and
      negotiation between the Parties.

18 -- 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

                                     Page 4

<PAGE>

      the same instrument and all of which when taken together shall constitute
      one and the same instrument.

                                     Page 5

<PAGE>

                   EXHIBIT "1" TO LETTER AGREEMENT DCT-0072003
                            SPECIAL INSURANCE CLAUSES

Buyer shall include the following endorsements in its Hull and Comprehensive
Airline Liability insurance policies:

1.    Hull All Risks Policy, including War, Hi-jacking and Other Perils.

      "It is hereby understood and agreed that Insurers agree to waive rights of
      subrogation against Embraer with regard to the insured Aircraft.

      This endorsement shall not operate to prejudice Insurer's rights of
      recourse against Embraer - Empresa Brasileira de Aeronautica S.A. as
      manufacturer, repairer, supplier or servicing agent where such right of
      recourse would have existed had this endorsement not been effected under
      this Policy."

2.    Comprehensive Airline Liability Policy, based on the AVN53 - Additional
      Insured Endorsement

      "It is hereby understood and agreed that Embraer - Empresa Brasileira de
      Aeronautica S.A. including any business entity owned by or subsidiaries to
      Embraer, and all partners, executive officers, employees and stock
      holders, are added as Additional Insureds only with respect to the
      operation of the Aircraft by the Named Insured.

      This endorsement does not provide coverage for any Additional Insured with
      respect to claims arising out of its legal liability as manufacturer,
      repairer, supplier or servicing agent where such right of recourse would
      have existed had this endorsement not been effected under this Policy."

3.    Notwithstanding anything to the contrary as specified in the Policy or any
      endorsement thereof, the coverages stated in paragraphs 1 and 2 above,
      shall not be cancelled or modified by the Insurer, without 48 hours
      advance written notice to Embraer to such effect.

This Endorsement attaches to and forms part of Policy No. ______________, and is
effective from the ____ day of ______, 200_."

                                     Page 1

<PAGE>

        EXHIBIT "2" - EMBRAER 170, EMBRAER 175, AND EMBRAER 195 SPECIFIC
                 CONFIGURATION, FINISHING AND REGISTRATION MARKS

                              **Material Redacted**

                                     Page 1

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