Document:

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                                                                    Exhibit 10.9

                                    AGREEMENT

                                     BETWEEN

                            CHAUTAUQUA AIRLINES, INC.

                                     AND THE

                                FLIGHT ATTENDANTS

                          OF CHAUTAUQUA AIRLINES, INC.

                                AS REPRESENTED BY

               THE INTERNATIONAL BROTHERHOOD OF TEAMSTERS, AFL-CIO

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                                TABLE OF CONTENTS
                                -----------------

Article 1     Recognition and Scope                                        1-1
Article 2     Definitions                                                  2-1
Article 3     Compensation                                                 3-1
Article 4     Expenses                                                     4-1
Article 5     Moving Expenses                                              5-1
Article 6     Scheduling                                                   6-1
Article 7     Vacancies                                                    7-1
Article 8     Paid Days Off                                                8-1
Article 9     Seniority                                                    9-1
Article 10    Training                                                     10-1
Article 11    Reduction in Force or Furlough                               11-1
Article 12    Leaves of Absence                                            12-1
Article 13    Physical Standards                                           13-1
Article 14    Insurance and Other Benefits                                 14-1
Article 15    Transfer to Management Duty                                  15-1
Article 16    Miscellaneous Flying                                         16-1
Article 17    Notices to Flight Attendants                                 17-1
Article 18    Grievances                                                   18-1
Article 19    System Board of Adjustment                                   19-1
Article 20    Union Membership                                             20-1
Article 21    Uniforms                                                     21-1
Article 22    General                                                      22-1
Article 23    New Equipment                                                23-1
Article 24    Hours of Service                                             24-1
Article 25    Duration                                                     25-1

LETTERS OF AGREEMENT
--------------------
1.       Red Circle Pay Rates
2.       Signing Bonus
3.       Anniversary Bonus
4.       Flight Attendant Job Share Program

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                                    ARTICLE 1

                              RECOGNITION AND SCOPE
                              ---------------------

A.       Pursuant to the certification by the National Mediation Board in Case
         No. R-6225 dated January 3, 1994, the Company recognizes the
         International Brotherhood of Teamsters, Airline Division, as the duly
         designated and authorized representative of the flight attendants in
         the employ of 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 flight attendants to provide for the operation of
         the Company under methods which will further to the fullest extent
         possible the safety of air transportation, the efficiency of operation,
         and the continuation of employment of flight attendants 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 flight attendants to cooperate fully
         for the attainment of these purposes.

C.       This Agreement supersedes 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.       Whenever the words "flight attendant" are used in this Agreement, they
         designate and refer to only such flight attendant(s) as covered by this
         Agreement. It is further recognized that whenever in this Agreement
         flight attendant(s) are referred to in either the masculine or feminine
         gender, it shall be understood to mean both male and female flight
         attendants.

E.       In accordance with applicable law, there shall be no discrimination by
         either party against any flight attendant 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 flight attendant.

F.       Except as otherwise provided in this Agreement, all present and future
         revenue flying (including that international flying which originates or
         terminates within the United States or its possessions) and all
         charters, or other utilization of Company owned or leased aircraft
         requiring flight attendants, performed in and for the service of the
         Company shall be performed by flight attendants on the flight
         attendants' Seniority List in accordance with the terms and conditions
         of this Agreement.

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

         1.       The Company will not acquire or establish another air carrier
                  (alter ego or otherwise) to replace flying performed for the
                  Company or to avoid the terms and conditions of this
                  Agreement;

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         2.       If the Company acquires or merges with another air carrier
                  that employs flight attendants, the flying operations will not
                  be consolidated or merged until the seniority lists of the two
                  flight attendant groups are integrated in a manner agreed upon
                  by the respective collective bargaining representatives or
                  other designated representatives. In the absence of an
                  agreement within four (4) months of the acquisition or merger,
                  the seniority lists will be integrated in accordance with
                  Sections 3 and 13 of the Allegheny-Mohawk Labor Protective
                  Provisions.

         3.       If the Company acquires or merges with an air carrier that
                  employs flight attendants, no flight attendant covered by this
                  Agreement on the date of such acquisition or merger will lose
                  any income or benefits as a result of such acquisition or
                  merger;

         4.       If the Company acquires or merges with an air carrier that
                  employs and has a collective bargaining agreement covering
                  flight attendants, the parties will meet to negotiate an
                  appropriate fence agreement pending the negotiation of a
                  merged agreement. If a merged agreement is not executed within
                  six (6) months from the date a final and binding integrated
                  list is issued, the parties shall jointly submit any
                  unresolved issues to binding interest arbitration.

H.       This Agreement is binding upon any successors and assigns of the
         parties hereto, unless or until changed my mutual agreement of the
         parties or in accordance with the provisions of the Railway Labor Act,
         as amended.

I.       The Company will not enter into any dry lease or wet lease agreement,
         or contract with or for any other carrier or entities (government,
         military or commercial) without mutual agreement with the Union.

                  1.       No flight attendant 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 in status or the furlough of any
                           Chautauqua flight attendant 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.

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                                    ARTICLE 2

                                   DEFINITIONS
                                   -----------

A.       "Block - to - block" means the elapsed time starting with the removal
         of the chocks or other restraining devices from the wheels of the
         aircraft when the aircraft first moves for the purpose of flight under
         its own power, and ending when the chocks or other restraining devices
         are replaced. [match]

B.       "Buildup Line" means a schedule built by the Company in accordance with
         Sections 6 and 24 that is blank when initially posted and which
         consists of trips, reserve days, and days off. [match]

C.       "Charter" means an off-line or on-line revenue passenger flight that is
         not a regularly scheduled flight. Extra sections are not considered
         charter flights. [match]

D.       "Check Flight Attendant" means a flight attendant selected at the
         discretion of the Company, after consultation with the Union, from
         among those flight attendants who have expressed, in writing, an
         interest in, and who meet the criteria for, such position. A check
         flight attendant will perform duties which include line checks, IOE,
         and other in-flight training. [match]

E.       "Company" means Chautauqua Airlines, Inc., its subsidiaries and
         divisions. [match]

F.       "Date of Hire" means the date on which a flight attendant first reports
         for flight attendant training by the Company. [match]

G.       "Day" means the time commencing at 0001 and ending at 2400 based on
         local time. [match]

H.       "Day Off" means a day free from all duty required by the Company at
         domicile. [match]

I.       "Deadhead Time" means the time spent by a flight attendant in traveling
         from one point to another at the direction of the Company, either for
         duty or returning from duty. [match]

J.       "Domestic" the forty-eight (48) contiguous states and the District of
         Columbia. [match]

K.       "Domicile" means a geographical location where a flight attendant is
         based. [match]

L.       "Duty Time" means the time a flight attendant is on duty commencing
         when a flight attendant is required to report or actually reports,
         whichever is later, for duty and ending ten (10) minutes after the
         conclusion of her flight or release from duty, whichever is later.
         [match]

M.       "Flight Attendant" means an employee of the Company whose name appears
         on the flight attendant seniority list and whose duties include
         ensuring the safety of passengers, the performance of in-flight service
         duties as assigned by the Company. [match]

N.       "Flight Time" means block-to-block time. [match]

0.       "Hot Reserve" means a period of time when a flight attendant is
         required to be on reserve at any domicile airport.

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P.       "International" means any point or area outside the forty-eight (48)
         contiguous states and the District of Columbia. [match]

Q.       "Longevity" means the period of time the flight attendant has actively
         served as a flight attendant. [match]

R.       "Month" means that period of time from and including the first day of
         and including the last day of each calendar month of the year, except
         that for pay and scheduling purposes, January, February, and March will
         each be a thirty (30) day month through the addition of January 31 and
         March 1 to the month of February.
         In a leap year, February will be a 31 day month. [match]

S.       "Operational reasons" shall mean actions taken by the Company after
         careful planning and analysis, and not arbitrarily or capriciously.
         Examples of such reasons shall include, but are not limited to, the
         following: 1. To avoid a potential flight delay, 2. To avoid a
         potential flight cancellation, and 3. To fulfill FAA/regulatory
         requirements. [match]

T.       "Hard Line" means a schedule built by the Company in accordance with
         Sections 6 and 24 that includes trips and days off. [match]

U.       "Rescheduled" means a change to a flight attendant's original scheduled
         assignment. [match]

V.       "Reserve Line" means a schedule built by the Company in accordance with
         Sections 6 and 24 that will be blank when posted and will include
         periods of availability for duty and days off. [match]

W.       "Seniority" means the length of service as a flight attendant with the
         Company. [match]

X.       "Trip" means a flight or series of flights that are paired together and
         may include one or more duty periods. [match]

Y.       "Vacancy" means a position(s) in a particular domicile in excess of the
         number of flight attendant(s) already in that domicile. [match]

Z.       "Wet Lease" means an agreement with another air carrier in which the
         Company provides an aircraft and crew to the other air carrier. [match]

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                                    ARTICLE 3

                                  COMPENSATION
                                  ------------

A.       Flight attendants will be paid for flight time based upon status and
         longevity in accordance with the hourly rates below. In computing hours
         for pay purposes, the actual time flown or the scheduled block time,
         whichever is greater, will be used. [match]

<Table>
<Caption>

                                        DOS+           DOS+         DOS+
            YEAR            DOS         12 MOS        24 MOS        36 MOS
            ----            ---         ------        ------        ------
<S>                         <C>          <C>          <C>            <C>
            0-6   mths      14.05        14.40        14.76          15.13
            7-12 mths       15.00        15.37        15.76          16.15
            2               16.50        16.92        17.34          17.77
            3               17.70        18.14        18.59          19.06
            4               18.80        19.27        19.75          20.24
            5               19.91        20.40        20.91          21.44
            6               20.80        21.32        21.85          22.39
            7               21.63        22.18        22.73          23.30
            8               22.43        22.99        23.57          24.16
            9               23.10        23.68        24.27          24.87
            10              23.78        24.37        24.98          25.60[match]
</Table>

B.       Pay Procedures [match]

         1.       Flight attendants will be paid on a bi-monthly basis, i.e.,
                  twenty-four (24) pay periods per year. [match]

         2.       Flight attendants will be paid on the fifteenth (15th) and the
                  last day of each month. If the fifteenth (15th) or the last
                  day of each month falls on a Saturday or Sunday, flight
                  attendants will be paid on the preceding Friday. The pay check
                  on the fifteenth (15th) of the month will adjust for any
                  additional amounts owed the flight attendant from the previous
                  month. [match]

         3.       A flight attendant will be paid at his option by direct
                  deposit into an account for that flight attendant at a
                  financial institution of the flight attendant's choice.
                  [match]

         4.       Clerical pay errors involving fifty dollars ($50.00) or more
                  shall be reconciled within five (5) working days after the
                  error is verified. Errors of less than fifty dollars ($50.00)
                  will be reconciled in the next pay check following
                  verification. [match]

C.       The minimum monthly guarantee will be seventy-five (75) hours at the
         flight attendant's hourly rate. A flight attendant who is unavailable
         for part of a month will have her guarantee prorated (except for paid
         vacation or paid sick leave). [match]

D.       A flight attendant who is called to the airport and assigned to flight
         or reserve duty and actually flies on a scheduled day off will be
         compensated at the greater of four (4) hours for the trip or her actual
         flight time for the trip in addition to her monthly guarantee or other
         flight

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         pay accrued. This paragraph does not apply to a flight attendant
         assigned on one of her minimum days off who has that day restored.
         [match]

E.       Training Pay [match]

         1.       A flight attendant who attends a day of recurrent training or
                  checks will be paid and credited with four (4) hours of flight
                  pay for up to six (6) days in any calendar year. [match]

         2.       If the Company elects to use any method of training such as
                  "home study" to comply with FAA requirements, a flight
                  attendant will be paid and credited with one (1) hour of
                  flight pay for every two (2) hours of FAA-approved training
                  credit earned in home study. [match]

         3.       Line checks and IOE will be paid in accordance with Article
                  3.A. [match]

         4.       A flight attendant in training will be paid no less than the
                  appropriate minimum monthly guarantee. [match]

         5.       Home study training mandated by the Company will be paid in
                  accordance with paragraph E.2., above. It is understood that
                  normal administrative paperwork, e.g., paycards, flight
                  reports, IOE evaluations, the Twin Turbine News, and other
                  routine Company memos do not constitute training. [match]

F.       1.       A flight attendant who performs management-related functions,
                  e.g., marketing promotions, special projects, etc., will be
                  paid additional compensation as determined by the Company.
                  [match]

         2.       A flight attendant who performs check flight attendant duties
                  will be paid five dollars ($5.00) per flight hour, or portion
                  thereof, in addition to her regular flight attendant hourly
                  rate. [match]

G.       For purposes of this Article, scheduled block times will be determined
         by using the average of historic enroute (block-to-block) times between
         city pairs by type of equipment and are attached hereto as "Appendix
         A." [match]

         1.       Scheduled block times will be reviewed by a joint
                  Company/Union Scheduling Committee every six (6) months using
                  the prior twelve (12) months average to determine whether any
                  adjustments are to be made. [match]

         2.       Adjustments will be made only when the average varies from the
                  established scheduled block time by seven and one-half percent
                  (7.5%), or more, plus or minus. [match]

         3.       When a new route is established for which no scheduled block
                  time has been computed in accordance with this Article, the
                  initial scheduled block time will be established based upon
                  the marketing time for that segment. After one hundred and
                  twenty (120) days of operation, the scheduled block time will
                  be reviewed. [match]
<Page>

         4.       Non-scheduled flights on routes where no established scheduled
                  block time exists will be credited on the basis of actual
                  (block-to-block) flight time. [match]

         5.       "Ferries," "attempts" and "diverted" flights will be paid on
                  the basis of actual (block-to-block) flight time. Taxi time
                  not associated with a flight will be credited at the rate of
                  two tenths (0.2) hours of flight pay. [match]

         6.       Data necessary for an accurate and complete review of
                  scheduled block times will be made available to the
                  Company/Union Scheduling Committee. After the Union
                  representatives have had an opportunity to review the data,
                  the Company will meet with those representatives upon request,
                  at a mutually agreeable time, to resolve any questions or
                  disputes. Members of the Company/Union Scheduling Committee
                  will not disclose any confidential or proprietary information
                  provided pursuant to this paragraph. [match]

H.       If a flight attendant is required to deadhead, she shall be credited
         with fifty percent (50%) of the scheduled block time for such flight.
         If required to deadhead via surface transportation, she shall be
         credited with fifty percent (50%) of driving time based upon AAA
         mileage at 50 MPH. A day consisting solely of deadhead to or from a
         flight assignment shall be considered a workday. [match]

I.       A flight attendant called in for drug testing on a scheduled day off
         shall be compensated two (2) hours of flight pay. [match]

J.       If a flight attendant is displaced by the Company from her flight due
         to training, to accomplish training for another flight attendant, or
         for any other reason, she may be reassigned another flight on the same
         day(s) as her original schedule, however, she shall be credited for the
         flight time on her original scheduled flight or the reassigned flight
         whichever is greater. [match]

K.       If a flight attendant is requested to report early, such flight
         attendant will be paid at the rate of five dollars ($5.00) per hour, or
         fraction thereof, prorated for all hours on duty prior to her
         originally scheduled report time. [match]

L.       A flight attendant who is assigned to flight duty or reserve on any of
         the below-listed holidays will receive four (4) hours of flight pay in
         addition to her monthly guarantee or flight pay accrued for that month.
         [match]

                  New Year's Day            Labor Day
                  Thanksgiving              Memorial Day
                  Christmas                 Independence Day  [match]

M.       Each flight attendant will receive a holiday bonus of one hundred fifty
         dollars ($150.00) the first week in December in each year of this
         Agreement. [match]

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                                    ARTICLE 4

                                    EXPENSES
                                    --------

A.       The Company will furnish guaranteed suitable single room lodging for a
         flight attendant who is scheduled to layover at a location for legal
         rest while on flying or training duty away from her permanent domicile.
         A flight attendant who is assigned to a continuous duty overnight away
         from domicile with a scheduled break of five (5) hours or more,
         block-in to block-out, will be provided lodging at the Company's
         expense. [match]

B.       When lodging is required in accordance with paragraph A., above, the
         Company will provide transportation to and from such lodging to the
         airport or training site, as applicable. If no eating facilities are
         available within walking distance of the lodging, transportation to and
         from an eating facility will be provided. [match]

C.       The Company will make prompt inquiries into complaints related to
         deterioration of service at any facility which has been approved for
         layovers. Prompt remedial action will be taken in those cases where
         investigation affirms a deterioration of service. [match]

D.       In lieu of reimbursement for meals and incidental travel expenses,
         flight attendants will be paid a per diem allowance of $1.25 per hour
         for time away from domicile in connection with flight duty, training or
         on-premise reserve, commencing at report for duty at domicile and
         ending upon release from duty at domicile. Effective twelve (12) months
         after date of signing, the per diem allowance will be increased to
         $1.30, and effective twenty-four (24) months after date of signing, the
         per diem allowance will be increased to $1.35. [match]

E.       When a flight attendant agrees to drive her personal vehicle at the
         request of the Company, she shall be allowed $.31 per mile point to
         point and return. A flight attendant will not be required to drive her
         personal vehicle. [match]

F.       At domicile or another location of the flight attendant's choice where
         free parking is not available, the Company will pay for the cost of the
         parking while the flight attendant is performing duty. The Company will
         not be required to pay for parking at more than one (1) location per
         flight attendant. Pay for parking at a location other than the flight
         attendant's domicile shall be required only when such employee parking
         is available and only to the extent of what the parking would have cost
         at the flight attendant's domicile. [match]

G.       The Company will provide travel on a booked basis when a flight
         attendant is deadheading on-line between the flight attendant's
         domicile and the point of her assigned duty. If the flight attendant is
         bumped from such on-line flight, the Company will book the flight
         attendant for positive space on the alternate on-line flight.

H.       The Company will reimburse each flight attendant for the cost of
         passports or visas or any airport government charges incurred in
         traveling on Company business. [match]

I.       When, due to irregular operations, special assignments, etc., a flight
         attendant incurs lodging or transportation expenses, she shall be
         reimbursed upon presentation of receipts for such expenses, provided
         she requests and receives advance approval for such expenses. [match]

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                                    ARTICLE 5

                                 MOVING EXPENSES
                                 ---------------

A.       Successful vacancy bidders, flight attendants moving to a domicile upon
         initial employment, and flight attendants making domicile swaps will
         pay their own moving expenses.

B.       The Company will pay for moving expenses when a flight attendant is
         required by the Company to change permanent domicile. A flight
         attendant displaced as a result of a reduction in schedules, domicile
         closure, equipment change or relocation of a domicile shall be
         considered transferred at the Company's request.

C.       When the Company is required to pay moving expenses, the move must be
         coordinated with the Inflight Department. Moving expenses must be
         submitted within thirty (30) days after incurring the expenses. Moving
         expenses other than automobile mileage and meals must be verified by
         receipts. The Company will not be responsible for any damages incurred
         during moving. The Company will not be responsible for paying any
         expenses under this Section after one (1) year from the date the flight
         attendant reports to the new domicile.

D.       Moving expenses paid by the Company will include the following:

         1.       When the flight attendant moves herself, the Company will pay
                  for all shipping containers, insurance for the move, one
                  hundred dollars ($100.00) to offset the cost of moving
                  helpers, the cost of vehicle registration, fuel, and
                  licensing.

         2.       Actual moving expenses for household goods and effects up to a
                  maximum of one thousand two hundred (1,200) cubic feet or
                  eight thousand (8,000) pounds, shipping and insurance
                  coverage, but excluding packing and unpacking and extra
                  insurance coverage, storage, and packing materials.

         3.       When personal automobile transportation is used by the flight
                  attendant and her immediate family, the Company will reimburse
                  the flight attendant at the current IRS rate per mile using
                  the most direct AAA routing between domiciles for up to two
                  (2) automobiles.

         4.       The Company will reimburse a flight attendant for meals and
                  lodging for the flight attendant and her immediate family for
                  the time required to travel to the domicile up to five (5)
                  days. A day of travel will 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 flight attendants, and forty-four dollars
                  ($44.00) per day for married flight attendants 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 such penalty
                  not to exceed one month's rent. The Company will cooperate
                  with the flight attendant 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

<Page>

                  and cable television, which result from a move to a new
                  domicile.

         7.       The Company will pay moving expenses only for actual moves of
                  a flight attendant's primary residence. To qualify for moving
                  expenses under this Section, the flight attendant must move to
                  a location within fifty (50) miles of the new domicile.

E.       When the Company is required to pay moving expenses, nothing in this
         Section is intended to prevent the Company and the flight attendant
         from agreeing to an amount to be paid to the flight attendant in lieu
         of the expenses set forth in this Section.

F.       The Company's liability for moving expenses under this Section will not
         exceed five thousand dollars ($5,000.00).

<Page>

                                    ARTICLE 6

                                   SCHEDULING
                                   ----------

A.       Scheduling Committee [match]

         The Union will establish a Scheduling Committee which will meet with
         the Company for the purpose of facilitating the efficient operation of
         this Article. The Scheduling Committee will be given reasonable access
         to non-confidential information regarding aircraft flows, block time
         reports, scheduled training, checkrides, vacations and leaves of
         absence. The Scheduling Committee may submit recommendations to the
         Company. When conflicts between the schedule and FARs or this Agreement
         are verified, the Company will take immediate action, if practicable,
         to resolve such conflicts. [match]

B.       Bidding and Awarding of Monthly Schedules [match]

         1.       Bid packages will be made available to all flight attendants
                  at each domicile at or before 1700 hours on the second Friday
                  of each month. [match]

         2.       A flight attendant must bid on an approved format submitted to
                  Crew Scheduling by U.S. mail, overnight express, facsimile,
                  electronically, if available, or any other means mutually
                  agreed upon. [match]

         3.       A flight attendant must submit her bid by 1700 hours on the
                  Tuesday following the second (2nd) Friday of each month.
                  [match]

         4.       The initial bid award will be made available to flight
                  attendants by 1700 hours on the third (3rd) Friday of each
                  month. [match]

         5.       Flight attendants who were initially awarded or assigned
                  reserve or build-up lines will be provided with their
                  scheduled lines after they are constructed on the final bid
                  award. [match]

         6.       The final bid award, which will include the final award of
                  build-up and reserve lines, will be posted no later than 1200
                  hours on the fourth Thursday of each month. [match]

         7.       All eligible flight attendants may bid for lines based upon
                  their domicile. All bids shall be awarded in accordance with
                  seniority. Awards will be published in each domicile. [match]

         8.       The Company shall make only the necessary adjustments to
                  awarded lines to correct errors and to provide for the
                  month-to-month interface period, vacation, training, minimum
                  days free from duty and approved leaves. [match]

         9.       Eligibility to Bid [match]

                  a.       A flight attendant attending initial, transition, or
                           upgrade training (from the beginning of ground school
                           to completion of IOE) will not bid a schedule for

<Page>

                           the month, except when the ground school is scheduled
                           to begin after the fifteenth (15th) of the month; in
                           such cases, the flight attendant will bid a schedule
                           for the month, and all trips that conflict with the
                           training will be dropped. [match]

                  b.       A flight attendant not eligible to bid will receive
                           her schedule at the same time as all other flight
                           attendants in accordance with paragraph 6.B.10.,
                           below. [match]

                  c.       A flight attendant will not bid in a month where she
                           is scheduled for leave (other than paid sick leave or
                           vacation) in excess of fifteen (15) days of the
                           month. [match]

                  d.       Flight attendants who have been on an approved leave
                           will provide the Company with documentation regarding
                           the termination of the leave. If the flight attendant
                           will be available for more than fifteen (15) days of
                           the month, the flight attendant will be eligible to
                           bid. [match]

         10.      A flight attendant failing to make a sufficient number of
                  bids, failing to meet the deadline, or submitting a bid form
                  that is either unsigned, incomplete or illegible, will be
                  assigned the highest unbid numerical line at the flight
                  attendant's domicile after all bidders' preferences have been
                  awarded. If more than one flight attendant fails to bid, they
                  will be assigned remaining lines in numerical order based on
                  their seniority. [match]

         11.      A flight attendant who will be on vacation or leave of absence
                  when bid packages are distributed may provide the Company with
                  a prepaid, pre-addressed overnight delivery envelope in which
                  case the Company will forward a copy of the bid package to
                  such flight attendant using such envelope. A flight attendant
                  who is sent a bid package by such method may submit her bid
                  via fax pursuant to Company directions. [match]

C.       Contents of the Bid Package [match]

         1.       Bid packages will contain: [match]

                  a.       All known trip series arranged in regular lines
                           except the Company may withhold up to five percent
                           (5%) of known flying. [match]

                  b.       An anticipated number of reserve lines, if any, which
                           will be blank. [match]

                  c.       An anticipated number of buildup lines, if any, which
                           will be blank. [match]

                  d.       All known training (inclusive of dates). [match]

                  e.       All awarded and available vacation time. [match]

                  f.       Flight and duty times. [match]
<Page>

                  g.       Report and release times. [match]

                  h.       RON information, including hotels, ground
                           transportation, etc. [match]

                  i.       A list of flight attendants who are in their prior or
                           due months for recurrent training and dates for
                           recurrent ground schools, if known. [match]

                  j.       A list of flight attendants eligible to bid in each
                           domicile. [match]

         2.       The Company will create as many hardlines as practical for a
                  given domicile, attempting insofar as practicable to offer a
                  variety of bid lines. Hardlines will contain the following:
                  [match]

                  a.       A planned sequence of trips with intervening days
                           off, arranged in a schedule for the month. [match]

                  b.       No reserve duty or charters. [match]

                  c.       Days off at domicile. [match]

                  d.       Up to ninety (90) scheduled hours of block time.
                           However, the Company may seek the concurrence of the
                           Union Scheduling Committee Chairman or Union to
                           exceed this limit. Such concurrence shall not be
                           unreasonably withheld. [match]

                  e.       No out of domicile trips. [match]

         3.       Build-up lines [match]

                  a.       Buildup lines shall be blank when published in the
                           bid package and subsequently constructed from trips
                           and/or series of trips that become available as a
                           result of vacation awards, training, checkrides,
                           leaves of absence and trips that are not in
                           hardlines. Buildup lines will contain a minimum of
                           thirty-seven and one-half (37.5) hours of scheduled
                           activity as identified above. Buildup lines will also
                           contain days off and may contain reserve days.
                           [match]

                  b.       Buildup lines may contain up to ninety (90) scheduled
                           hours of block time. However, the Company may seek
                           the concurrence of the Union to exceed this limit.
                           Such concurrence shall not be unreasonably withheld.
                           Concurrent with the initial monthly bid, a flight
                           attendant who is awarded a buildup line may express
                           her preference(s) for type of trips, days off,
                           training assignments, etc., by listing the
                           appropriate letter code followed by the specific
                           preference in the appropriate spot on the bid sheet.
                           To the extent practicable, preferences will be
                           awarded in seniority order and in the order listed.
                           [match]
<Page>

                             PREFERENCE CODE     PREFERENCE
                             ---------------     ----------

                                     A           Specific dates off

                                     B           Weekends off

                                     C           Consecutive days off at anytime

                                     D           Multi-day trips

                                     E           Single day trips

                                     F           Training

                                     G           Charter flights

                  c.       The Company will construct build-up lines with as
                           many in domicile trips as practicable. [match]

                  d.       Build-up lines may contain charters. [match]

                  e.       Reserve days and out of domicile trips may be built
                           into the build-up lines. [match]

                  f.       If the number of build-up lines is less than
                           anticipated, additional reserve lines will be
                           constructed and assigned to those flight attendants
                           able to hold build-up lines. [match]

                  g.       The Company will create as many build-up lines as
                           practicable in a given domicile. [match]

         4.       Reserve lines [match]

                  a.       Reserve lines will be blank when published in the bid
                           package and subsequently constructed to show reserve
                           days and days off. [match]

                  b.       When constructed, reserve lines will contain: [match]

                           (i)      Intervening periods of availability and days
                                    off; [match]

                           (ii)     As many in domicile days as practicable;
                                    [match]

                           (iii)    Out of domicile reserve days, if available,
                                    and associated deadhead; and [match]

                           (iv)     Type of reserve. [match]

                  c.       Concurrent with the initial monthly bid, flight
                           attendants may express preferences for days off,
                           number of days off in a given spread, training, etc.,
                           by listing the appropriate letter code followed by
                           the specific preference in the appropriate spot on
                           the bid sheet. To the extent practicable, preferences
                           will be awarded in seniority order and in the order
                           listed. [match]

<Page>

                             PREFERENCE CODE     PREFERENCE
                             ---------------     ----------

                                     A           Specific days off

                                     B           Weekends off

                                     C           Consecutive days off at anytime

                                     F           Training

                  d.       Assignment of reserve spread(s) shall be made in
                           accordance with preference(s) bid. Once assigned,
                           reserve spreads shall be considered immovable with
                           the exception that two (2) spreads may be moved by no
                           more than forty-eight (48) hours except by mutual
                           agreement or when necessary to accomplish training
                           for the flight attendant. [match]

D.       Month-to-Month Interface Period [match]

         1.       The interface period shall consist of the first three (3) days
                  of the month. During this time, Crew Scheduling may adjust bid
                  lines for those flight attendants whose lines are in conflict
                  with the previous month's schedule, including FAR conflicts.
                  [match]

         2.       A flight attendant may be assigned an AVL ("available") day(s)
                  during the interface period. [match]

                  a.       If assigned an AVL day, the flight attendant must
                           contact Crew Scheduling after 1900 domicile time on
                           the evening prior to the AVL day for assignment.
                           [match]

                  b.       An AVL day cannot become a reserve day or charter.
                           [match]

                  c.       If not assigned a specific flight assignment, the AVL
                           day will be converted to a day off. [match]

E.       Reserve Duty [match]

         1.       For the purposes of calculating days off, a reserve day will
                  be considered a day of work. [match]

         2.       A reserve flight attendant will not be required to start an
                  on-call period with less than the minimum rest required by
                  Article 24. [match]

         3.       A reserve flight attendant will not be scheduled to be on call
                  in excess of twelve (12) hours in a day. A reserve flight
                  attendant may not be assigned to a flight assignment that is
                  scheduled to exceed fourteen (14) hours after reporting for
                  duty at the airport. [match]

         4.       A flight attendant on reserve may be scheduled for hot reserve
                  duty for up to twelve

<Page>

                  (12) hours, including any on call and scheduled flight
                  assignments. The Company may schedule a buildup lineholder for
                  up to five (5) hot reserve days, and a reserve lineholder may
                  be scheduled for hot reserve for up to ten (10) hot reserve
                  days. If the Company later determines that it needs additional
                  hot reserve, it may assign a reserve lineholder to serve
                  additional hot reserve duty and will compensate such flight
                  attendant at the rate of twenty-five dollars ($25.00) for each
                  additional hot reserve assignment, or portion thereof, above
                  the maximums set forth above. [match]

         5.       A flight attendant on reserve will be subject to a one and
                  one-half (1.5) hour call out unless assigned to a domicile
                  where a shorter call out time has been mutually agreed upon
                  between the Company and the Union. A flight attendant will
                  make every effort to report earlier. [match]

         6.       The Company may, in its discretion, release a flight attendant
                  from reserve earlier than scheduled. [match]

         7.       A flight attendant on reserve may use a "pager" at her
                  expense. However, the flight attendant is solely responsible
                  for ensuring the quality of service of the pager, and any
                  malfunction of a pager is solely the responsibility of the
                  flight attendant. The flight attendant is also solely
                  responsible for ensuring that she remains within the pager's
                  calling area. [match]

         8.       A flight attendant on reserve will respond to a telephone
                  message or page from the Company within twenty (20) minutes,
                  and such time will be included in the call out time required
                  in paragraph E.5., above. Once a flight attendant receives an
                  assignment, she is no longer responsible to be available for
                  contact prior to such assignment until report time. [match]

         9.       A flight attendant on reserve who is assigned a RON that
                  extends into a day off will be given the option of receiving
                  day off pay pursuant to Article 3.D. or having that day off
                  restored in the current or following month. The Company will
                  not make such assignment if there is another reserve available
                  in the domicile and calling out such reserve will not delay
                  the flight. [match]

F.       Assignment of Open Time [match]

         1.       Open time which remains after the construction of buildup
                  lines and open time which subsequently becomes available
                  during the month will be assigned in the following order,
                  provided that such assignment shall not conflict with FARs or
                  any other provision of this Agreement: [match]

                  a.       Assign to a reserve flight attendant in domicile (the
                           Company may opt to skip such flight attendant); then
                           [match]

                  b.       Award to any other flight attendant, on a first-come,
                           first-served basis, who volunteers for open time;
                           then [match]

                  c.       Assign to a flight attendant who has been rescheduled
                           (the Company may

<Page>

                           opt to skip such flight attendant); then [match]

                  d.       Assign to a reserve flight attendant in domicile;
                           then [match]

                  e.       Assign to a reserve flight attendant from another
                           domicile (the Company may opt to skip such flight
                           attendant). [match]

                  f.       Assign to a supervisory flight attendant. [match]

         2.       The Company may assign open time to a supervisory flight
                  attendant without regard to paragraph F.1., above, if no other
                  flight attendant is available for such assignment without
                  delaying or canceling the flight. [match]

         3.       The Company will make reasonable efforts to post open time.
                  [match]

G.       Displacement [match]

         1.       If more than one (1)flight attendant is assigned to the same
                  trip, the senior flight attendant will have the choice of
                  flying the trip or not. The flight attendant not flying the
                  trip will either be reassigned to a trip or released from duty
                  for the remainder of the trip and will be credited with the
                  greater of the value of the trip originally assigned or the
                  trip to which she is reassigned. [match]

         2.       If a flight attendant is displaced from her assignment by
                  another flight attendant at the Company's direction for the
                  purpose of training or IOE, the flight attendant who is
                  displaced will either be reassigned to a trip or released from
                  duty for the remainder of the day and will be credited with
                  the greater of the value of the trip originally assigned or
                  the trip to which she is reassigned. [match]

H.       Rescheduling for Operational Reasons [match]

         1.       Reserve flight attendant [match]

                  A flight attendant holding a reserve line may be rescheduled
                  within the limitations of Articles 6 and 24. [match]

         2.       Hardline and Buildup Lineholders [match]

                  After the publication of the final award, a flight attendant
                  holding a hardline or build-up line may be rescheduled for
                  operational reasons. However, any rescheduled trip must remain
                  within the date(s) of the original trip, regardless of when
                  the rescheduling occurs or how many times the flight attendant
                  is rescheduled. If Scheduling has no assignment for her within
                  3 hours, the Flight Attendant will be released until the
                  following day, provided she was on a multi-day trip. [match]

         3.       Availability for Rescheduling [match]

                  The Flight Attendant will contact or be available to be
                  contacted by Scheduling between the hours of 6:00 a.m. and
                  9:00 a.m. each day she was originally scheduled. If at the
                  time of contact, Scheduling has no assignment, she will be

<Page>

                  released until the following morning, until rescheduled or
                  until the days of the original trip have been exhausted.
                  Flight Attendants subject to rescheduling shall not be
                  expected to report sooner than 3 hours after being assigned to
                  the rescheduled trip. [match]

         4.       Rescheduling restrictions [match]

                  Flight Attendants subject to rescheduling shall not be placed
                  on reserve. Rescheduling must be within the limitations of
                  Articles 6 and 24. A Flight Attendant scheduled for a single
                  day trip will not be rescheduled for a multi-day trip. A
                  Flight Attendant subject to be rescheduled pursuant to this
                  paragraph will be paid the greater of her actual or
                  rescheduled trip, if any. A Flight Attendant who has
                  voluntarily picked up trips in Open Time, and whose trips are
                  subsequently cancelled will not be required to be available
                  over the same day(s) of their trip, nor will they be pay
                  protected for the trip. [match]

I.       Trip Trades [match]

         1.       Trip trade requests must be in writing, signed by both flight
                  attendants and received by Crew Scheduling no later than
                  forty-eight (48) hours prior to the date of the earliest trip
                  being traded. Crew Scheduling may waive the forty-eight (48)
                  hour requirement. [match]

         2.       A flight attendant may participate in up to five (5) trades
                  each month. [match]

         3.       Trip trade requests may be for a partial or an entire trip.
                  [match]

         4.       Trip trades must not violate FARs or any provision of this
                  Agreement. Crew Scheduling may require a buffer equivalent to
                  the buffer(s) used to construct the lines of time at any time
                  when there is any potential for illegality under the FARs or
                  this Agreement. If all of the provisions of this Article are
                  met, the trade will be approved. If a trade is disapproved,
                  the flight attendant will be advised, upon request, of the
                  reasons for the denial. [match]

         5.       Flight attendants on reserve may trade one (1) reserve day for
                  another, subject to approval by Crew Scheduling. [match]

         6.       A flight attendant who loses time from her schedule because of
                  a trip trade which causes her to fall below her minimum
                  monthly guarantee will have her minimum monthly guarantee
                  adjusted. [match]

         7.       Crew Scheduling will approve or reject a trip trade request
                  within seven (7) days after it is received, but no later than
                  twenty-four (24) hours before the report time for the earliest
                  trip being traded. Crew Scheduling may waive this requirement.
                  Trip trades are approved when the flight attendant obtains
                  confirmation from Crew Scheduling. If Crew Scheduling
                  implements a system of trip trade approval notification
                  involving electronic, faxed, or other similar means of
                  notification to the flight attendant's domicile, the trip
                  trade will be considered approved when such notification is
                  posted electronically or by hard copy. [match]

<Page>

         8.       At Company discretion, a flight attendant may drop trips into
                  open time with a corresponding reduction of the flight
                  attendant's monthly guarantee. [match]

J.       Continuous Duty Overnights [match]

         1.       Pure CDO lines [match]

                  a.       A flight attendant on a pure CDO line will be
                           scheduled for no more than four (4) consecutive CDOs.
                           [match]

                  b.       A flight attendant on a pure CDO line will be
                           scheduled for a minimum of two (2) consecutive days
                           off after three (3) consecutive CDOs and three (3)
                           consecutive days off after four (4) consecutive CDOs.
                           [match]

                  c.       CDO trips in pure CDO lines will be scheduled with a
                           minimum of five (5) hours of ground time, block in to
                           block out. If less than four (4) hours of ground time
                           is realized, a flight attendant must have twelve (12)
                           hours off duty during her next scheduled rest period.
                           [match]

         2.       Except for pure CDO lines, all other hardlines will be
                  scheduled for no more than two (2) blocks of up to three (3)
                  consecutive CDOs in a month. [match]

         3.       A CDO trip will not be scheduled for more than five (5) legs.
                  [match]

         4.       CDO trips will terminate and the flight attendant will be
                  released upon first arrival at the domicile following the CDO
                  period. [match]

         5.       A flight attendant will not be required to participate in
                  training without her consent during the scheduled ground time
                  on a CDO. [match]

         6.       Except for pure CDO lines, CDO trips will be scheduled with a
                  minimum of six (6) hours of ground time, block in to block out
                  (minimum of five (5) hours block in to block out if the
                  scheduled duty time for the CDO is fourteen (14) hours or
                  less). If less than six (6) hours of ground time is realized,
                  a flight attendant must have twelve (12) hours off duty during
                  her next scheduled rest period. [match]

         7.       No flight attendant will be scheduled/rescheduled from a CDO
                  trip to any other trip, other than another CDO, unless she has
                  received the minimum number of days off required by Article
                  24.D.2. [match]

K.       General [match]

         1.       A flight scheduled to terminate before 00:00 (midnight) of the
                  first (1st) day will be considered to have terminated on the
                  first (1st) day if it terminates no later than 0200 hours
                  local time on the second (2nd) day. [match]

         2.       Flight attendants domiciled outside the United States will be
                  subject to this Agreement. [match]
<Page>

         3.       A flight attendant will not be required to drive or be driven
                  to an airport as part of a regularly scheduled duty assignment
                  nor will a flight attendant be required to transport
                  passengers via ground transportation. [match]

         4.       All times referred to in this Article are local time at the
                  domicile. [match]

<Page>

                                    ARTICLE 7

                                    VACANCIES
                                    ---------

A.       Standing Bids [match]

         1.       Flight attendants must submit standing bids indicating order
                  of preference for domicile vacancies. The Company may require
                  flight attendants to submit new or updated standing bids at
                  least thirty (30) days prior to any circumstances that may
                  cause the existing bid file to become outdated (e.g., domicile
                  closures, domicile openings or other substantial operational
                  changes, etc.). [match]

         2.       The standing bid file will be maintained by the Company.
                  Standing bids will be available for inspection by any flight
                  attendant during normal office hours. [match]

         3.       A flight attendant may change her standing bid at any time by
                  submitting a new standing bid to the Company. A flight
                  attendant must bid on an approved format submitted to the
                  Company by U.S. Mail, overnight express, facsimile,
                  electronically, if available, or any other means mutually
                  agreed upon.
                  [match]

B.       Notice of Vacancy [match]

         1.       The Company will determine when a vacancy exists. [match]

         2.       No later than ten (10) days after the Company determines that
                  a vacancy exists, it will post a notice of the vacancy. The
                  notice will specify the domicile at which each vacancy will
                  occur. [match]

         3.       Bidding will close at 1700 hours seven (7) days after the
                  posting of the notice of vacancy. [match]

C.       Awarding and Assignment of Vacancies [match]

         1.       Awards will be posted by 1700 hours four (4) days after the
                  closing of the bid. [match]

         2.       The Company will not normally post secondary, tertiary, etc.,
                  vacancies caused by filling primary vacancies. [match]

         3.       Bids for vacancies will be awarded in order of seniority using
                  standing bids on file as of the date bidding is closed.
                  [match]

         4.       If no flight attendant bids a vacancy, the Company may assign
                  a flight attendant to that vacancy in reverse order of
                  seniority. [match]

         5.       The Company will determine the effective date of an award
                  which may be changed provided adequate notice is given and the
                  change is not made for arbitrary reasons. The Company may
                  cancel an award at any time before its effective date. [match]

<Page>

         6.       A flight attendant awarded a vacancy will fill the vacancy
                  within sixty (60) days after the effective date of the award.
                  [match]

D.       Domicile Swaps [match]

         Flight attendants requesting a mutual domicile swap must submit a
         request in writing to the Company no later than the fifth (5th) of the
         month. Approval of a swap is subject to the following: [match]

         1.       The Company will review the mutual swaps on file no later than
                  the seventh (7th) of the month and post those mutual swaps
                  that will become effective with the following month's bid
                  award. [match]

         2.       If approved, flight attendants involved in the mutual swap
                  will be restricted from submitting a subsequent mutual swap
                  request for a period of six (6) months from the effective date
                  of the mutual swap. [match]

E.       Temporary Vacancies [match]

         1.       A temporary vacancy will be any vacancy anticipated to exist
                  for less than ninety (90) days. [match]

         2.       When the Company decides to fill a temporary vacancy, it will,
                  if practicable, fill such vacancy from among qualified flight
                  attendants in seniority order who have expressed a desire to
                  fill a temporary vacancy. If the vacancy remains unfilled, the
                  temporary vacancy will be assigned to a reserve flight
                  attendant in reverse seniority order, insofar as may be
                  practicable. [match]

         3.       A flight attendant filling a temporary vacancy will be paid
                  per diem and expenses in accordance with this Agreement.
                  [match]

F.       All times referred to in this Article are local time at the Company's
         headquarters. [match]

<Page>

                                    ARTICLE 8

                                  PAID DAYS OFF
                                  -------------

A.       Flight attendants will accrue PDOs in accordance with the following
         schedule: [match]

         1.       Years Of          Monthly
                  Service           Accrual
                  -------           -------

                  1                 4.0 hours
                  2                 4.33 hours
                  3                 4.67 hours
                  4                 5.0 hours
                  5                 5.33 hours
                  6                 5.67 hours
                  7                 6.0 hours
                  8                 7.0 hours
                  9                 7.33 hours
                  10                7.67 hours       [match]

                  PDOs will be charged at four (4.0) hours for each day a PDO is
                  taken. [match]

         2.       Flight attendants must be on active status on or before the
                  fifteenth (15th) day of each month to accrue PDOs for that
                  month. [match]

         3.       At year end unused PDOs may be: [match]

                  a.       Cashed in. [match]

                  b.       Placed in the PDO Sick Bank. [match]

                  c.       Up to two times a flight attendant's annual accrual
                           may be carried over for subsequent use. [match]

B.       PDOs For Annual Vacation [match]

         1.       Not later than the 15th day of November, the Company will
                  distribute the annual PDO Request Form for the following
                  calendar year. Annual bids for PDOs must be returned by the
                  30th day of November. Flight attendants will be notified of
                  their annual vacation bid award by the 15th day of December.
                  Annual bids have priority over the ensuing monthly requests
                  for PDOs. [match]

         2.       Annual vacation bids will be awarded in order of seniority.
                  [match]

         3.       Vacation bids must be in full week increments, i.e., seven (7)
                  consecutive days, Monday through Sunday. A flight attendant
                  may bid only the PDOs that will be accrued as of November 30
                  of the current year; however, if the flight attendant's PDO
                  bank drops below the vacation actually bid, the Company may
                  cancel the corresponding amount of vacation (minimum of one
                  (1) week). [match]

<Page>

         4.       Annual vacation bid awards will not be changed except by
                  mutual agreement between the Company and the flight attendant.
                  [match]

         5.       The Company may restrict up to four (4) weeks during a
                  calendar year in each domicile during which annual vacation
                  may not be bid. Such a restriction will be imposed only for
                  operational reasons that will be discussed with the Union
                  before being imposed. [match]

         6.       No less than seventy-five percent (75%) of accrued PDO's will
                  be made available for the annual vacation bid by domicile.
                  [match]

         7.       A flight attendant who is awarded a vacancy in a different
                  domicile after having been awarded annual vacation may be
                  required to rebid her annual vacation from remaining available
                  vacation periods in the new domicile. [match]

         8.       Annual vacation periods that are vacated will be made
                  available to other flight attendants on a first-come,
                  first-served basis. [match]

C.       PDOs For Monthly Vacation [match]

         1.       Not later than the 1st day of each month, the Company will
                  accept requests for PDOs in the following month (i.e.,
                  requests for a PDO in March must be submitted by February 1).
                  Requests will be on a first-come, first-serve basis. Not later
                  than the 20th day of the month, the Company will post the
                  upcoming month's schedule that will indicate the PDO award for
                  that month. [match]

         2.       The Company will award all bids reasonably possible taking
                  into account the needs of the schedule. [match]

D.       PDO Sick Bank [match]

         1.       Flight attendants may elect payment from their PDO Sick Bank
                  up to one-half (1/2) of the minimum monthly guaranteed hours
                  per pay period for furlough, medical, or family leave. [match]

         2.       PDO Sick Bank days may be used for personal or family illness
                  and injuries on or off the job. [match]

         3.       There is no maximum number of days which can be placed in the
                  PDO Sick Bank. During the month of December, flight attendants
                  may notify the Company of the number of PDOs to be placed in
                  the PDO Sick Bank. [match]

E.       General [match]

         1.       Accrued PDOs may be exchanged for pay at the flight
                  attendant's request. If a flight attendant elects to be paid
                  for PDOs in lieu of taking time off, she will be paid at her
                  current hourly rate for each PDO exchanged. A maximum of
                  fifteen (15) PDOs may be exchanged each month. A flight
                  attendant who resigns and has given the Company

<Page>

                  fourteen (14) days written notice of her intention to resign,
                  and who actually works on each such assigned work day during
                  such notice period, will be entitled to her accumulated PDOs
                  up to her date of resignation. In the event of a flight
                  attendant's death, the amount will be paid to her estate.

         2.       PDOs will be charged only on days the flight attendant is
                  scheduled to perform duty for the Company. [match]

         3.       One (1) PDO will be charged for each continuous duty overnight
                  (CDO) missed as a result of vacation or sick leave. [match]

         4.       A flight attendant who, in a rolling 6-month period, has
                  perfect attendance will be credited with four (4) additional
                  hours for each such six (6) month period to a maximum of eight
                  (8) hours in any calendar year. [match]

<Page>

                                    ARTICLE 9

                                    SENIORITY
                                    ---------

A.       A flight attendant's seniority shall begin on the flight attendant's
         date of hire. When two (2) or more flight attendants have the same date
         of hire, they shall be placed on the seniority list according to the
         last four (4) digits of their social security numbers, i.e., the lowest
         number shall be the most senior. A flight attendant's pay shall
         commence on date of hire. Except as otherwise specified in this
         Agreement, all flight attendants shall be full time employees of the
         Company.

B.       A flight attendant shall lose her seniority if any of the following
         occurs:

         1.       Voluntary resignation;

         2.       Discharge for just cause;

         3.       Failure to report for duty at the expiration of a leave of
                  absence;

         4.       Failure to report for duty after recall from furlough in
                  accordance with Section 11.

C.       Seniority shall prevail at all times in matters concerning equipment
         bids, reductions, recall, base bidding, assignments, upgrades,
         transitions and vacations, or except as otherwise specified in this
         Agreement.

D.       A current seniority list will be posted on the flight attendant's
         bulletin board and posted in each flight attendant domicile quarterly
         (January 1, April 1, July 1, and October 1) with a copy sent to the
         Union and the Chief Steward. Any alleged error or omission affecting a
         flight attendant's seniority on any list must be protested by the
         affected flight attendant, in writing, within thirty (30) days of the
         posting. A flight attendant making no protest within the time specified
         may not thereafter protest the alleged error or omission on the
         disputed list or any subsequent list.

E.       A flight attendant will be on probation for the flight attendant's
         first twelve (12) months of active service with the Company.

<Page>

                                   ARTICLE 10

                                    TRAINING
                                    --------

A.       The Company will establish training requirements for flight attendants.

B.       The Company will post recurrent training dates, if any, for bid in the
         monthly bid package. A flight attendant who will be in her prior or due
         month in the month being bid may bid on available recurrent training
         dates. Such bids will be awarded in seniority order, provided that: (1)
         awarding the bid does not result in a conflict with other duty; (2)
         seniority notwithstanding, a flight attendant in her due month will
         have bidding priority over a flight attendant in her prior month; (3) a
         flight attendant in her due month who has not made a successful bid for
         a recurrent training date, or who is in her grace month, may be
         assigned a recurrent training date. A flight attendant assigned to
         training will be so notified at least five (5) days prior to
         commencement of training unless shorter notice is required because of
         regulatory agency or aircraft manufacturer directive. Such notice may
         be waived by the flight attendant. If the Company finds it necessary to
         move a flight attendant's recurrent date and/or to assign her to a
         training date due to operational reasons (e.g., loss or reduction of
         training staff, an excess of flight attendants who require training,
         etc.), the Company will make reasonable efforts to accommodate flight
         attendants' preferences for training dates.

C.       Training will not be scheduled for more than six (6) consecutive days
         followed by twenty - four (24) consecutive hours free of duty.

D.       A flight attendant shall not be required to attend training for more
         than ten (10) hours a day, no more than eight (8) of which shall be
         classroom hours.

E.       A flight attendant removed from duty for retraining or reexamination
         shall lose no more than three (3) days of pay.

F.       No flight attendant shall be required to pay for the use of any Company
         equipment or equipment outside the Company that is required for
         training.

G.       The Chief Steward, or her designee, (either of whom shall be an
         employee of the Company) may observe any ground-based training. Such
         observation shall be without pay and shall not interfere with the
         conduct of the training.

<Page>

                                   ARTICLE 11

                         REDUCTION IN FORCE OR FURLOUGH
                         ------------------------------

A.       The Company will provide at least fourteen (14) days written notice of
         any force surplus requiring a reduction in the number of flight
         attendants in a particular domicile.

B.       A flight attendant holding an award in the surplus domicile shall be
         displaced in inverse order of seniority.

C.       A displaced flight attendant may accept layoff at the point, displace
         the most junior flight attendant in the system or fill any vacancy in
         accordance with Section 7. If there are multiple flight attendants
         displacing junior flight attendants at more than one domicile, the
         displacing flight attendants may elect which of those available
         domiciles to displace into in seniority order. A flight attendant who
         accepts layoff at the point will thereafter be treated as a furloughed
         flight attendant for purposes of recall.

D.       Notification of Furlough.

         1.       When a flight attendant is to be furloughed, she will be given
                  fourteen (14) days notice, by return receipt requested, from
                  the Company, unless the furlough occurs as a result of
                  conditions beyond the Company's control, such as a curtailment
                  or reduction in operation because of fire, flood, storm or
                  similar acts of God, strikes, Company bankruptcy, catastrophic
                  air accidents that have a direct effect on the Company's
                  business, grounding of a fleet type, or similar occurrences.
                  In such cases, the Company will give as much notice as
                  possible. Copies of all furlough or recall notices will be
                  sent to the Chief Steward and the Union.

         2.       A furloughed flight attendant will file her current address
                  and telephone number with the Company and will advise the
                  Company, in writing, of any changes within seven (7) days of a
                  change.

E.       Furlough

         1.       Flight attendants will be furloughed in inverse order of
                  seniority.

         2.       A flight attendant who is furloughed will retain and continue
                  to accrue seniority.

         3.       A furloughed flight attendant will be recalled in seniority
                  order prior to the Company hiring additional flight
                  attendants.

         4.       Prior to effecting a furlough, flight attendants will be
                  encouraged to take earned vacation or a personal leave of
                  absence to prevent furlough.

         5.       Flight attendants who are granted a personal leave of absence
                  during periods of furlough will continue to accrue seniority.

         6.       No flight attendant may be bumped by a more junior flight
                  attendant.

<Page>

F.       Recall From Furlough

         1.       Recall notices will be sent by the Company, return receipt
                  requested, to the last known address the Company has on file
                  for the flight attendant. The Company may notify more flight
                  attendants than the number being recalled to identify those
                  who will accept or bypass recall.

         2.       A recalled flight attendant must notify the Company of
                  acceptance or bypass within seven (7) days after the receipt
                  of the recall notice or she will be subject to termination.

         3.       A flight attendant may bypass recall until all of the
                  furloughed flight attendants junior to her have been recalled.
                  If an insufficient number of flight attendants accept recall,
                  the Company shall notify furloughed flight attendants in
                  reverse seniority order that recall is mandatory. Such flight
                  attendants must report to active service within seven (7) days
                  of receipt of the mandatory notice.

         4.       A furloughed flight attendant will be allowed fifteen (15)
                  days after receipt of a notice of a recall to report for duty
                  at the point specified by the Company. The Company may, at its
                  discretion, extend this period.

G.       Time Off Without Pay

         When the Company intends to furlough one or more flight attendant(s)
         involuntarily, it will offer voluntary time off without pay to a like
         number of flight attendants in seniority order within the domicile(s)
         where the Company is overstaffed. Such flight attendants may request
         time off without pay in writing for a specified duration. The Company
         will grant such requests, in writing, specifying the authorized
         duration of the leave which may be less, but not more, than the
         duration requested by the flight attendant. A flight attendant who
         accepts voluntary time off without pay will continue to accrue
         seniority but will not accrue longevity or benefits. Such flight
         attendant may continue her medical insurance in accordance with COBRA.
         The Company may, but is not required to, allow the flight attendant to
         return early from the leave, but the flight attendant will not be
         required to return to work before the leave has expired. A flight
         attendant may request an extension of the leave in writing which may be
         granted by the Company in writing. Immediately after the expiration of
         a leave of absence granted under this paragraph, a flight attendant
         will return to the domicile where she was assigned immediately prior to
         the leave. If the domicile no longer exists for flight attendants, the
         flight attendant may displace a less senior flight attendant in the
         domicile of her choosing.

<Page>

                                   ARTICLE 12

                                LEAVES OF ABSENCE
                                -----------------

A.       Personal Leave of Absence

         The Company at its sole discretion may grant a personal leave of
         absence without pay. A flight attendant shall submit her request for a
         personal leave of absence, in writing, on a form to be supplied by the
         Company, setting forth the reasons therefore. The Company will then
         return to the flight attendant either 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 flight attendant must return to active service with
         the Company. While on leave of absence the flight attendant will
         continue to accrue seniority but not accrue benefits. However, the
         flight attendant may elect to continue health and life insurance
         benefits, provided the flight attendant pays the full monthly premiums
         to the Company in accordance with COBRA. The Company and the flight
         attendant may mutually agree to extend the leave of absence. Such
         extension must be in writing and signed by both parties, setting a
         specific date by which the flight attendant must return to active
         service.

B.       Military Leave of Absence

         Military leaves will be granted in accordance with applicable law. 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 national emergency, except
         under specific military orders, or as otherwise required by Federal
         Law. The flight attendant shall give the Company reasonable notice of
         said active duty. A flight attendant who volunteers for extended duties
         must get prior approval from the Company.

C.       Medical Leave of Absence

         1.       This type of leave of absence is designed to cover a flight
                  attendant who is unable to perform her duties due to illness
                  or injury. Upon exhaustion of sick leave, a flight attendant
                  will be placed on a medical leave of absence.

         2.       The Company may offer a non-flying position to any flight
                  attendant who can no longer perform her job because of illness
                  or injury.

         3.       A flight attendant on medical leave of absence shall continue
                  to accrue seniority. The Company shall continue to provide
                  health and life insurance benefits for a period of up to
                  ninety (90) days after the flight attendant has exhausted her
                  sick leave. The flight attendant may elect to continue health
                  and life insurance benefits, provided the flight attendant
                  pays the full monthly premiums to the Company in accordance
                  with COBRA.

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

D.       Family Leave of Absence

<Page>

         The Company will grant leaves in accordance with the Family and Medical
         Leave Act of 1993. Bases with less than fifty (50) employees will also
         be covered by the Act. While on Family Leave the flight attendant will
         continue to accrue seniority and all benefits, without interruption and
         at no cost. A flight attendant on Family Leave will have the option to
         draw full pay until sick leave accumulation and vacation accumulation
         are exhausted. Upon return from Family Leave the flight attendant will
         have the option to return to the domicile held prior to said leave, or
         any vacancy in accordance with her seniority.

E.       Bereavement Leave of Absence

         If a flight attendant suffers a death in her immediate family she shall
         immediately notify Crew Scheduling and be granted up to five (5)
         consecutive days leave with full pay. Such days shall be mutually
         agreed upon by the flight attendant and Crew Scheduling. A flight
         attendant's immediate family shall be defined as a flight attendant's
         mother, father, spouse, children and step-children. Up to three
         consecutive days will be granted for the death of the flight
         attendant's brother, sister, mother-in-law, father-in-law, or
         grandparent. Such bereavement leave may, upon request, be extended for
         additional days, and, if extended, may be either without pay or with
         pay charged against the flight attendant's earned vacation.

F.       Union Leave

         1.       At the request of the Union (sixty (60) day advance notice) a
                  flight attendant shall be granted an indefinite Union leave of
                  absence without pay to accept employment with the Teamsters
                  Airline Division. While on such leave the flight attendant
                  shall continue to accrue seniority and be covered by Company
                  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 flight attendant's monthly guarantee, prorated. The
                  flight attendant will maintain all other benefits covered by
                  this Agreement and may continue to participate in the 401K
                  Plan. No more than one (1) flight attendant shall be permitted
                  a Union leave at one time. A flight attendant on Union leave
                  will be given recurrent training necessary to remain current
                  as a Chautauqua flight attendant.

         2.       At the request of the Union, the Company will, subject to the
                  needs of the service, release flight attendants for the
                  purpose of conducting union business. Requests for release
                  must be submitted in writing to the Manager of Inflight at
                  least seven (7) days before the requested day(s) off. The
                  Company may waive the seven (7) day requirement. Trips dropped
                  to accommodate such leaves will be placed in open time unless
                  the Company elects to assign such trips to reserves.

         3.       Reimbursement for Flight Pay Loss

                  a.       Except as provided in Section 12.F.1., the Union
                           shall reimburse the Company for Union leave paid to a
                           flight attendant by multiplying the number of hours
                           on leave paid by the Company times the applicable
                           hourly rate for the flight attendant, plus 23% to
                           cover the cost of fringe benefits.

                  b.       The Union agrees to reimburse the Company within
                           forty-five (45) days after receipt

<Page>

                           of the Company's bill.

G.       Jury Duty Leave

         1.       A flight attendant shall provide the Manager of Inflight with
                  a copy of the summons or notice of jury duty immediately upon
                  receipt of such documents. A flight attendant shall
                  concurrently provide the Company with authorization to
                  intercede with the appropriate authorities for the purpose of
                  removing her from jury duty.

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

         3.       A flight attendant who is called for jury duty shall be paid
                  and credited four (4.0) hours pay and credit at her applicable
                  hourly rate for each scheduled duty or reserve day lost to
                  jury duty. Such jury duty leave pay shall be offset by any
                  amount the flight attendant receives from the court.

         4.       Immediately upon release from jury duty, a flight attendant
                  shall notify the Company of her availability for flying
                  status.

         5.       A flight attendant on jury duty leave shall continue to accrue
                  seniority, longevity and all benefits as if she had been in
                  active service.

H.       Maternity Leave

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

         2.       A flight attendant shall notify the Company immediately upon
                  confirmation of her pregnancy.

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

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

I.       Return From Leave

         Immediately after the expiration of a leave of absence granted under
         paragraphs 12.A., 12.C., 12.F. or 12.H., a flight attendant will return
         to the domicile where she was assigned immediately prior to the leave.
         If the domicile no longer exists for flight attendants, the flight
         attendant may displace a less senior flight attendant in the domicile
         of her choosing.

<Page>

                                   ARTICLE 13

                               PHYSICAL STANDARDS
                               ------------------

The physical standards required of a flight attendant shall be no less than the
standards established by the FAA. A flight attendant shall maintain the ability
to perform all required duties.

<Page>

                                   ARTICLE 14

                          INSURANCE AND OTHER BENEFITS
                          ----------------------------

A.       The Company shall provide each flight attendant 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.       Flight Attendant Life Insurance:

                  Two (2) times the basic annual earnings, rounded to the next
                  higher $1,000. to a maximum of $250,000.

         2.       Accidental Death and Dismemberment:

                  Four (4) times the basic annual earnings, rounded to the next
                  higher $1,000. to a maximum of $500,000.

         3.       Dependent Life Benefits:

                           a.       Spouse:                        $5000

                           b.       Children:    0-8 days          $0
                                                 8 days - 6 mo     $100
                                                 6 mo - 19 yrs     $2500

B.       The Company will provide health insurance for the flight attendants and
         qualifying dependents, the benefits of which shall not be less
         advantageous than the existing program coverage and benefits. For
         flight attendants with under one (1) year of service, the Company shall
         pay one hundred percent (100%) of the premium cost, minus fifteen
         dollars ($15.00), per pay period, for said flight attendants, however,
         dependent coverage premiums may be paid by said flight attendants
         through payroll deduction. For flight attendants with over one (1) year
         of service, the Company shall pay one hundred percent (100%) of the
         premium cost, minus fifteen dollars ($15.00) for individual flight
         attendant coverage, twenty-five dollars ($25.00) for flight attendant
         and spouse coverage or thirty-five dollars ($35.00) for flight
         attendant and family coverage, per pay period. Should the cost of such
         insurance increase, the Company may require greater contributions from
         flight attendants.

C.       The Company will provide the Chief Steward and the Union with copies of
         master insurance contracts for each policy required under the terms of
         this Agreement.

D.       The Company will provide a 125 Flexible Benefits Plan to all flight
         attendants, the benefits of which shall not be less advantageous than
         the existing program.

E.       The Company will provide retirement benefits (i.e., 401(k)) to all
         flight attendants, and the benefits shall be no less advantageous than
         the existing program.

F.       Effective upon ratification of this Agreement, the Company shall
         contribute to the Local 210 Scholarship Fund the sum of four dollars
         ($4.00) per month for each employee covered by

<Page>

         this Agreement.

G.       Effective upon ratification of this Agreement, the Company shall
         contribute to the Local 210 Maternity Fund the sum of four dollars
         ($4.00) per month for each employee covered by this Agreement.

H.       Effective date of signing, the Company shall pay for dental plan
         coverage for single flight attendants or sixteen and one-half dollars
         ($16.50) per month towards the cost of family coverage. The plan for
         flight attendants and qualified dependents will be no less advantageous
         than the program offered to other employee groups.

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

<Page>

                                   ARTICLE 15

                           TRANSFER TO MANAGEMENT DUTY
                           ---------------------------

A.       A flight attendant who is transferred to a managerial position shall
         retain but not accrue seniority for six (6) months. At the expiration
         of six (6) months, the flight attendant's name shall be removed from
         the seniority list.

B.       A flight attendant accepting or transferring to a managerial position
         will not be awarded a bid line of flying.

<Page>

                                   ARTICLE 16

                              MISCELLANEOUS FLYING
                              --------------------

A.       Flight attendants may not fly commercially outside the Company.

B.       The Company will not transfer any Company aircraft to, or schedule any
         flight attendant to fly any trips for, airlines that are on strike
         unless mutually agreed to by the Company and the Union.

C.       The Company will not transfer aircraft to a subsidiary or alter-ego for
         the purpose of avoiding the terms of this Agreement

<Page>

                                   ARTICLE 17

                          NOTICES TO FLIGHT ATTENDANTS
                          ----------------------------

All notices to flight attendants involving domicile assignment, promotion,
demotion, furlough, and leaves of absence shall be stated in writing, with a
copy mailed to the Union office and a designee.

<Page>

                                   ARTICLE 18

                                   GRIEVANCES
                                   ----------

A.       Grievance

         A grievance is a claim or dispute by a Flight Attendant or the Union
         concerning the interpretation, application, or the alleged breach of
         this Agreement. Any flight attendant or group of flight attendants 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. [match]

B.       Step One - Informal Discussion With a Supervisor

         1.       A Flight Attendant or Union representative who believes that
                  her rights under this Agreement have been violated should
                  first bring the matter to the attention of the Flight
                  Attendant's immediate supervisor.

         2.       The immediate supervisor, or her designee, must reply to the
                  Flight Attendant within five (5) business days. [match]

         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 Flight Attendant or
                  the Union shall reduce the grievance to writing and submit it
                  to the Director of Inflight, 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.
                  [match]

         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 Director of Inflight, 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. [match]

         3.       The Director of Inflight, 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. [match]

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>

         submission of the case to the System Board, with a copy to the Director
         of Inflight within fifteen (15) business days after receiving the Step
         Two decision. [match]

E.       Discipline or Discharge.

         1.       No Flight Attendant shall be subject to discipline or
                  discharge without just cause. A Flight Attendant shall be
                  notified in writing of discharge, disciplinary time off and
                  written reprimand. The Company will send a copy of such notice
                  to the Flight Attendant and to the Union. A Flight Attendant
                  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 of
                  the written discipline or discharge action by the Company.

         2.       Flight Attendants 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 18.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 18.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 grievance 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.       A flight attendant shall have the right of Union
                  representation at all meetings with the Company. A flight
                  attendant shall be advised in advance of the nature of the
                  subject of any investigation, hearing or conference.

         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

<Page>

                  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>

                                   SECTION 19

                           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 which may arise under
         the terms of this Agreement and any amendment or additions thereto and
         which are properly submitted to it, which Board shall be known as
         Flight Attendants' 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 "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
                  their 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
                  or until a successor has been duly selected. Such terms of
                  office shall commence on January 1 of each year.

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

         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 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.       Members of the Board who are employees of the Company shall
                  suffer no loss of pay while attending Board meetings.

C.       Jurisdiction of the Board

<Page>

         1.       The Board shall have jurisdiction over all disputes growing
                  out of grievances or out of the interpretation or application
                  of any of the terms of this Agreement or amendments thereto
                  submitted by the Union to the Vice President of Flight
                  Operations 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.

         2.       The Board shall consider any dispute properly submitted to it
                  when such dispute has not been previously settled in
                  accordance with Section 18.

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 to each member of the Board within three
                  (3) days. 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 hearing, which shall be the time
                  of the next regular meeting of the Board as provided in
                  paragraph B, above, or, if at least two (2) Board Members
                  consider the matter of sufficient urgency and importance, then
                  at such earlier date at such place as the Chairman and Vice
                  Chairman shall agree upon but no more than thirty (30) days
                  after such request for a meeting is made by at least two (2)
                  of the 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.       Flight attendants may be represented at Board hearings by such
                  person or person as they may choose and designate, and the
                  Company may be represented by such person or person 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
                  employee shall suffer no loss of pay. The number of witnesses
                  summoned at any one time shall not be greater than the number
                  which can be spared from the operation without interference
                  with the service of the Company.

         5.       The Board shall be competent to hear the disputes properly
                  submitted to it and decide disputes by a majority vote of all
                  members of the Board. Decisions of the Board shall be final
                  and binding upon the parties.

E.       Deadlock Procedures

<Page>

         When a dispute is properly submitted to the Board for hearing 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 select an
         arbitrator. 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.

F.       Deadlock Notices

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

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

         1.       If notice is provided of the desire to convene the five (5)
                  Member Board, the Union and the Company shall promptly meet,
                  but in no event later than seven (7) days from the date of the
                  notice by the Union to select an arbitrator by mutual
                  agreement from the following names:

                  Richard Block             Lawrence Holden       Nicholas Zumas
                  John Dunsford             Herbert Fishgold
                  Robert Harris             Joseph Scerno

         2.       If none of the above-named arbitrators are available to
                  conduct a hearing within sixty (60) days of their selection,
                  the Company or the Union may petition the National Mediation
                  Board (NMB) for a list of seven (7) names from which the fifth
                  (5th) arbitrator shall be selected. Either party shall have
                  the right to reject one (1) list of arbitrator sent by the NMB
                  in its entirety, in which case the parties will request a new
                  list of arbitrators from the NMB. The order of striking shall
                  be determined by lot for the first case in which an arbitrator
                  is chosen and in subsequent cases, the parties shall alternate
                  taking the first strike.

H.       Five (5) Member Board Hearing

         Within thirty (30) days after the selection of the fifth (5th) member,
         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. The Board may agree to have the arbitrator hear the
         case without the Board present.

I.       General

         1.       Expenses of the Board

<Page>

                  Each of the parties will assume the travel and expenses of the
                  Board members selected by it and each of the parties will
                  assume the travel expense and other expenses of the witnesses
                  called or summoned by it except employees of the Company will
                  suffer no loss of pay and that the Company will provide space
                  available transportation over its lines, in accordance with
                  the existing regulations, for any Board member or Company
                  employee who is called or summoned as a witness. The expense
                  and compensation of the fifth (5th) member of the Board will
                  be borne by the parties. The Chairman and the Vice Chairman,
                  acting jointly, shall have the authority to incur such 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 each of the parties.

         2.       Freedom to Act

                  Each and every Board member shall be free to discharge her
                  duty in an independent and uncoerced manner without fear that
                  her individual relations with the Company, with the flight
                  attendants, or with the Union will be affected in any manner
                  by any action taken by him in good faith in her capacity as a
                  Board member,

         3.       Time Limits

                  Time limits 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 to the flight
                  attendants or to the Company, the Union, or their duly
                  accredited representatives under the provisions of the Railway
                  Labor Act, as amended.

         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.

<Page>

                                   ARTICLE 20

                                UNION MEMBERSHIP
                                ----------------

A.       Union Membership

         It shall be a condition of employment that all flight attendants
         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 flight attendants 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 flight attendants covered
         by this Agreement said flight attendants' dues as a member of the Union
         upon receiving the flight attendant's voluntary and individual written
         authorization for the Company to make such deductions, signed by the
         flight attendant. 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 flight attendant'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 which may be made by a flight attendant against
         the Company by virtue of the wrongful application or misapplication of
         any of the terms of this Section.

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 a
         flight attendant from her employment by reason of her failure to
         maintain her membership in good standing in the Union in accordance
         with Section A., above.

F.       Flight Attendant List

         1.       When applicable, the Company will advise the Union of the
                  names of any new hires, termination, layoffs or recall of any
                  flight attendants covered by this Agreement. Such information
                  will include the name, hire date, layoff date, termination
                  date or recall date of such flight attendants.

<Page>

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

G.       Individual Dues Payment

         It shall be the responsibility of any flight attendant who is not on a
         dues deduction program to keep her 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.       Bulletin Board

         The Company will provide the Union with one suitable glass covered
         bulletin board at a location designated by the Union for posting of
         official notice of Union meetings, elections and other notices
         pertaining to internal Union matters. All such notices shall be signed
         by a duly authorized representative of the Union.

J.       Union Access

         The Union Representative(s) shall have free access to the Company's
         operations facilities to transact that business which is necessary for
         the administration of this Agreement. The Company further agrees to
         provide the Union Representative with proper ID to enter its operation
         facilities, if required.

K.       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>

                                   ARTICLE 21

                                    UNIFORMS
                                    --------

A.       A flight attendant shall wear the standard uniform as required in
         Company regulations at all times when on duty or in connection with any
         event or special assignment where the flight attendant is identified as
         a flight attendant with the Company.

B.       The flight attendant will be responsible for the cost of the initial
         basic uniform and all accessories.

C.       The Company will provide each flight attendant with one (1) set of
         wings and one (1) name tag.

D.       The flight attendant shall be permitted to wear the official Union
         insignia (not to exceed one (1) inch in diameter) on the right lapel or
         one-half (1/2) inch below the wings.

E.       Upon reasonable notice, the Company will meet with the Chief Steward or
         her designee to resolve problems involving procurement of basic uniform
         items or before making changes to the basic uniform.

F.       If the Company changes the basic uniform, it shall be responsible for
         supplying each flight attendant with the new basic uniform item(s).

G.       The Company will pay fifty percent (50%) of all replacement parts due
         to normal wear and tear after eighteen (18) months. The flight
         attendant will be paid a uniform allowance of twenty dollars ($20.00)
         per month.

H.       The price of uniform items purchased through the Company will be at the
         Company's cost.

I.       Required Basic Uniform Items (Male and Female)

                           1 Blazer
                           2 Bottoms
                           1 Belt
                           5 Shirts
                           1 Tie
                           1 Raincoat with removable liner

J.       The Company will replace or repair any uniform item that is damaged
         while on duty.

K.       The Company will loan maternity uniforms to flight attendants as
         needed.

L.       The Company will consider the recommendations of the Union's Uniform
         Committee.

<Page>

                                   ARTICLE 22

                                     GENERAL
                                     -------

A.       Nothing in this Agreement shall be construed to limit or deny any
         flight attendant any rights or privileges to which she may be entitled
         under provisions of the Railway Labor Act, as amended.

B.       The Company shall supply copies of the Agreement for distribution to
         the flight attendants within thirty (30) days of the signing of this
         Agreement. The Company will also provide trainees with a copy of this
         Agreement during initial training.

C.       Flight attendants shall immediately notify the Company of any change in
         address or telephone contact number. The Company shall supply such
         information to the Union at the time it supplies the Union with the
         seniority list.

D.       The Company shall furnish an identification card to each flight
         attendant. Flight attendants shall bear the cost of replacement, if
         lost.

E.       No flight attendant or her 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 her duties with the Company.

F.       Flight attendants will be subject to the pass policy of the Company on
         the same basis as groups of other Company employees. Flight attendants
         who retire from the Company after reaching age 60 with fifteen (15) or
         more years of service shall be entitled to Company pass privileges. The
         designated Union Business Representative will be provided space
         available travel on the Company system for the purpose of administering
         this Agreement.

G.       This Agreement, when accepted by the parties and signed by the
         respective representatives duly authorized, shall constitute the sole
         agreement between them involving the flight attendants. Any alteration
         or modification of this Agreement must be made by and between the
         parties and must be in writing.

H.       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.

I.       The Company will provide all flight attendants with required Company
         manuals. The flight attendants will be responsible for such manuals and
         will, if such manuals are lost or negligently damaged, be required to
         reimburse the Company for the cost of replacements. Upon termination,
         the flight attendant must return such manuals or reimburse the Company
         for the cost thereof.

J.       The Union shall appoint a Professional Standards Committee, composed of
         flight attendants which shall confer with the Company on matters
         pertaining to the professional proficiency and training of flight
         attendants. Members of this Committee shall be permitted to observe any
         training period. The Union shall appoint a Safety Committee, composed
         of flight attendants, which shall confer with the Company on matters
         pertaining to safety operations.

<Page>

         A member of each of these Committees shall be permitted to attend any
         hearing or investigation of an accident or incident of Company aircraft
         involving a flight attendant, subject to the regulations of the
         government agency involved. The Company will cooperate in releasing
         such members to participate in such hearings.

K.       A personnel file will be maintained for each flight attendant. Upon
         request, the flight attendant will be given the opportunity to review
         her file. If a flight attendant receives disciplinary action, any
         portion of her file to be relied upon by the Company in support of such
         disciplinary action shall be open for review upon request by the Union
         representative and the flight attendant. Further, any rebuttal letter
         written by the affected flight attendant related to the disciplinary
         letter shall also be placed in her personnel file. The Company cannot
         use any disciplinary notices in support of disciplinary action if the
         flight attendant had not been provided with written notice of the prior
         disciplinary action at the time discipline was assessed. A copy of all
         disciplinary letters issued to flight attendants will be forwarded to
         the Union. Disciplinary letters will be removed from a flight
         attendant's file twelve (12) months after the date of issuance provided
         there are no other infractions of a similar nature in the intervening
         period.

L.       When it is not required to have a cabin attendant jumpseat occupied for
         Company purposes, cabin jumpseat authority for personal business shall
         be granted to active Inflight Services personnel on a first come, first
         served basis before offering access to such jumpseat to other
         authorized jumpseat riders on personal business. Such authorization
         shall be subject to the FARs and the Company Operations Specifications.
         The Captain has final authority to ensure that carriage of a flight
         attendant jumpseat rider does not affect weight or operational
         restrictions or cause displacement of revenue. The Company, in
         consultation with the Union, will develop and publish reasonable
         procedures to implement this jumpseat policy.

<Page>

                                   ARTICLE 23

                                  NEW EQUIPMENT
                                  -------------

A.       If the Company decides to place into service a new aircraft type that
         requires more than one flight attendant crewmember for revenue
         operation, before such new aircraft type is placed into revenue
         service, meeting(s) between the Company and the Union shall be
         initiated by either the Company or the Union, in accordance with
         Section 6, Title I of the Railway Labor Act, as amended, for the
         purpose of negotiating salaries, rules, and/or working conditions for
         such aircraft which shall be retroactive to the date such aircraft is
         placed into service. Such conferences, when held, shall not delay the
         placing of such aircraft into service providing the Company has given
         the Union sixty (60) days advance notice in writing that it is
         considering a different type of aircraft. However, if any such aircraft
         is placed into service sixty (60) days or thereafter of written notice
         to the Union and before agreement is reached regarding pay, rules,
         and/or working conditions, such aircraft will be operated by the flight
         attendants covered by this Agreement and will be operated in accordance
         with all of the provisions of this Agreement except where FARs are more
         restrictive, in which case FARs will represent the minimum standard in
         those areas where it is more restrictive than the Agreement.

B.       When the introduction of such new equipment necessitates that flight
         attendants be retrained, the Company will post the available training
         dates for bid in the monthly bid package. Such bids will be awarded in
         seniority order, provided that awarding the bid does not result in a
         conflict with other duty. A flight attendant who is not awarded a date
         for training may be assigned to training. If training is assigned, the
         Company will provide at least five (5) days notice prior to
         commencement of training unless shorter notice is required because of
         regulatory agency or aircraft manufacturer directive. Such notice may
         be waived by the flight attendant.

<Page>

                                   ARTICLE 24

                                HOURS OF SERVICE
                                ----------------

A.       Rest Periods

         1.       Scheduled Rest

                  a.       In domicile, a flight attendant will be scheduled
                           with a minimum of ten (10) hours of rest between duty
                           periods (from release time until next report time).

                  b.       A flight attendant will not be scheduled for reduced
                           rest of less than eight and one half (8.5) hours
                           (from release time until next report time).

                  c.       When away from domicile, a flight attendant will not
                           be scheduled for less than eight and one half (8.5)
                           hours of rest (from release time until next report
                           time).

         2.       Actual Rest

                  A flight attendant will receive no less than eight (8) hours
                  between duty periods (from release time until next report
                  time).

B.       Duty Time Limitations

         1.       A flight attendant will not be scheduled/rescheduled for a
                  duty period in excess of fourteen (14) hours, unless by
                  consent of the flight attendant, except that a CDO may be
                  scheduled for up to fifteen (15) hours.

         2.       A flight attendant scheduled for a reduced rest overnight will
                  be scheduled for no more than ten (10) hours of duty in her
                  next duty period.

         3.       A flight attendant's duty time for a flight, trip or trip
                  pairing shall commence at the later of the flight attendant's
                  scheduled report time or actual report time. Report time shall
                  be scheduled for thirty (30) minutes prior to departure time
                  of the first flight, but may be extended to forty-five (45)
                  minutes at the Company's discretion. It will end fifteen
                  minutes after arrival time of the last flight of the duty
                  period, plus an additional fifteen (15) minutes if clearing
                  customs, repositioning an aircraft (as required by the
                  Company), or a combination of the above. At the request of
                  either party, the parties will meet to evaluate, on an
                  airport-by-airport basis, circumstances involving longer or
                  shorter times for clearing customs or repositioning that do
                  not fit the foregoing parameters. If the parties agree that an
                  adjustment should be made, the change will be implemented.

         4.       Duty time for multiple day trip pairings will begin and end at
                  a flight attendant's domicile.

         5.       Trip pairings will not be scheduled in excess of five (5)
                  consecutive days and if scheduled for five (5) days, the fifth
                  day may only be one leg returning the flight

<Page>

                  attendant to domicile.

         6.       A duty period will contain a maximum of ten (10) landings.

         7.       Except in unusual circumstances, a duty period will contain a
                  maximum of three (3) scheduled consecutive round trips to the
                  same destination.

C.       Flight Time Limitations

         A flight attendant will not be scheduled for more than:

         1.       Eight (8) hours of block time in a duty period, except that a
                  flight attendant flying turbo-jet equipment may be scheduled
                  for no more than nine (9) hours of block time in a duty
                  period.

         2.       Thirty (30) hours of block time in any seven (7) day period.

         3.       One hundred (100) hours of block time in a calendar month.

D.       Days Off

         1.       The Company will schedule regular and buildup lineholders with
                  at least twelve (12) days off in domicile per bid period. A
                  flight attendant holding a reserve line will be scheduled for
                  at least eleven (11) days off in domicile per bid period. A
                  flight attendant in training will be scheduled for days off
                  during such training in accordance with Article 10.

         2.       Hardlines, buildup and reserve lines will be scheduled with
                  one (1) period of at least three (3) consecutive days off. All
                  other periods of days off will be scheduled as groups of at
                  least two (2) days, except during the integration period,
                  which may contain single days off.

         3.       If a flight attendant is unavailable for flight duty for a
                  part of a bid period, her minimum scheduled days off will be
                  prorated. A flight attendant is unavailable if she cannot
                  perform flight duty because, e.g., of lack of current
                  qualifications or leaves, excluding sick leave and bereavement
                  leave.

         4.       A flight attendant will not be scheduled/rescheduled to
                  perform any duty, including ground school, for more than six
                  (6) consecutive days without a calendar day off.

         5.       In no case will any flight attendant be reduced below her
                  minimum days off in domicile without receiving a replacement
                  day off in the same or following month.

         6.       A flight attendant who voluntarily reduced her days off will
                  not be entitled to replacement day(s) off.

E.       Notification

         1.       The Company will maintain a standard method of notifying a
                  flight attendant if

<Page>

                  scheduled departure time will be appreciably delayed (more
                  than one (1) hour) or canceled. A flight attendant will be
                  notified as far in advance as is practicable.

         2.       The Company will not contact an off duty flight attendant
                  between 2200 and 0600 local domicile time. The following
                  exceptions apply:

                  a.       If there is a change in the flight attendant's
                           schedule, the flight attendant may be called one (1)
                           hour prior to the original or revised report time,
                           whichever is earlier, provided the call is made to
                           minimize the disruption to the flight attendant's
                           rest. No more than one (1) personal contact will be
                           made during that period by the Company for this
                           reason.

                  b.       A flight attendant on reserve may be contacted during
                           her period of reserve availability.

                  c.       A flight attendant off duty may be contacted when the
                           operational requirements dictate.

         3.       A flight attendant who is unable to report for duty will
                  notify Crew Scheduling as far in advance as practicable.

         4.       A flight attendant will not be required to keep the Company
                  notified of her whereabouts on her days off.

<Page>

                                   ARTICLE 25

                                    DURATION
                                    --------

This Agreement will become effective on date of signing and will continue in
full force and effect through [DOS + 48 months] and will renew itself without
change until each succeeding [ ] thereafter, unless written notice of intended
change is served in accordance with Section 6, Title I, of the Railway Labor
Act, as amended, by either party thereto at least ninety (90) but not more than
one hundred and twenty (120) days prior to [DOS + 48 months], or any [ ]
thereafter.

IN WITNESS WHEREOF, the parties have signed this Agreement this _____ day of
___________, 1999.

For International Brotherhood of Teamsters      For Chautauqua Airlines, Inc.

/s/ Ray Benning                                 /s/ Edward J. Wegel
------------------------------                  ------------------------------
Ray Benning, Director                           Edward J. Wegel
Teamsters Airlines Division                     President and CEO

/s/ Barry Schimmel                              /s/ Donald C. Young
------------------------------                  ------------------------------
Barry Schimmel                                  Donald C. Young
Business Agent, Local 210                       Executive Vice President and COO

/s/ Mary Schrier                                /s/ Barry Confer
------------------------------                  ------------------------------
Mary Schrier                                    Barry Confer
Chief Steward                                   Director of Inflight Services

/s/ Lisa Paterini                               /s/ Amy Pogacnik
------------------------------                  ------------------------------
Lisa Paterini                                   Amy Pogacnik
Assistant Chief Steward                         Manager of Inflight Services

/s/ Debra Tate
------------------------------
Debra Tate
Negotiating Committee Member

<Page>

                            LETTER OF AGREEMENT NO. 1

                                     between

                            CHAUTAUQUA AIRLINES, INC.

                                       and

        THE FLIGHT ATTENDANTS in the service of CHAUTAUQUA AIRLINES, INC.

                              as represented by the

                     INTERNATIONAL BROTHERHOOD OF TEAMSTERS

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

                              RED CIRCLE PAY RATES

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

THE LETTER OF AGREEMENT is made and entered into in accordance with the
provisions of the Railway Labor Act, as amended, by and between CHAUTAUQUA
AIRLINES, INC. (hereinafter referred to as the "Company") and the flight
attendants in the service of the Company, as represented by the INTERNATIONAL
BROTHERHOOD OF TEAMSTERS (hereinafter referred to as the "Union").

Flight attendants who are on the seniority list as of, or before, January 1,
1999 will be paid for flight time based upon status and longevity in accordance
with the hourly rates below. In computing hours for pay purposes, the actual
time flown or the scheduled block time, whichever is greater, will be used.

<Table>
<Caption>

                                     DOS+            DOS+         DOS+
       YEAR              DOS         12 MOS         24 MOS        36 MOS
       ----              ---         ------         ------        ------

<S>                      <C>          <C>           <C>            <C>
       0-6   mths        14.18        14.53         14.90          15.27
       7-12 mths         15.15        15.53         15.92          16.31
       2                 17.07        17.50         17.93          18.38
       3                 18.80        19.27         19.75          20.25
       4                 19.99        20.49         21.00          21.53
       5                 22.66        23.23         23.81          24.40
       6                 23.98        24.58         25.19          25.82
       7                 24.61        25.23         25.86          26.50
       8                 25.49        26.13         26.78          27.45
       9                 25.88        26.53         27.19          27.87
       10                26.25        26.91         27.58          28.27 [match]
</Table>

IN WITNESS WHEREOF, the parties have signed this Agreement this _____ day of
___________, 1999.

For International Brotherhood of Teamsters     For Chautauqua Airlines, Inc.

/s/ Ray Benning                                /s/ Edward J. Wegel
------------------------------                 ------------------------------
Ray Benning, Director                          Edward J. Wegel
Teamsters Airlines Division                    President and CEO

<Page>

/s/ Barry Schimmel                             /s/ Donald C. Young
------------------------------                 ------------------------------
Barry Schimmel                                 Donald C. Young
Business Agent, Local 210                      Executive Vice President and COO

/s/ Mary Schrier                               /s/ Barry Confer
------------------------------                 ------------------------------
Mary Schrier                                   Barry Confer
Chief Steward                                  Director of Inflight Services

/s/ Lisa Paterini                              /s/ Amy Pogacnik
------------------------------                 ------------------------------
Lisa Paterini                                  Amy Pogacnik
Assistant Chief Steward                        Manager of Inflight Services

/s/ Debra Tate
------------------------------
Debra Tate
Negotiating Committee Member

<Page>

                            LETTER OF AGREEMENT NO. 2

                                     between

                            CHAUTAUQUA AIRLINES, INC.

                                       and

        THE FLIGHT ATTENDANTS in the service of CHAUTAUQUA AIRLINES, INC.

                              as represented by the

                     INTERNATIONAL BROTHERHOOD OF TEAMSTERS

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

                                  SIGNING BONUS

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

THE LETTER OF AGREEMENT is made and entered into in accordance with the
provisions of the Railway Labor Act, as amended, by and between CHAUTAUQUA
AIRLINES, INC. (hereinafter referred to as the "Company") and the flight
attendants in the service of the Company, as represented by the INTERNATIONAL
BROTHERHOOD OF TEAMSTERS (hereinafter referred to as the "Union").

Each flight attendant in the employ of the Company on the date of signing of the
Agreement shall receive an amount equal to two hundred dollars ($200) for each
year or portion thereof of completed service on the day before the date of
signing the Agreement, subject to applicable deductions. All such payments shall
be made no later than the second paycheck following the date of signing of the
Agreement.

IN WITNESS WHEREOF, the parties have signed this Agreement this _____ day of
___________, 1999.

For International Brotherhood of Teamsters     For Chautauqua Airlines, Inc.

/s/ Ray Benning                                /s/ Edward J. Wegel
------------------------------                 ------------------------------
Ray Benning, Director                          Edward J. Wegel
Teamsters Airlines Division                    President and CEO

/s/ Barry Schimmel                             /s/ Donald C. Young
------------------------------                 ------------------------------
Barry Schimmel                                 Donald C. Young
Business Agent, Local 210                      Executive Vice President and COO

/s/ Mary Schrier                               /s/ Barry Confer
------------------------------                 ------------------------------
Mary Schrier                                   Barry Confer
Chief Steward                                  Director of Inflight Services

<Page>

/s/ Lisa Paterini                              /s/ Amy Pogacnik
------------------------------                 ------------------------------
Lisa Paterini                                  Amy Pogacnik
Assistant Chief Steward                        Manager of Inflight Services

/s/ Debra Tate
------------------------------
Debra Tate
Negotiating Committee Member

<Page>

                            LETTER OF AGREEMENT NO. 3

                                     between

                            CHAUTAUQUA AIRLINES, INC.

                                       and

        THE FLIGHT ATTENDANTS in the service of CHAUTAUQUA AIRLINES, INC.

                              as represented by the

                     INTERNATIONAL BROTHERHOOD OF TEAMSTERS

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

                                ANNIVERSARY BONUS

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

THE LETTER OF AGREEMENT is made and entered into in accordance with the
provisions of the Railway Labor Act, as amended, by and between CHAUTAUQUA
AIRLINES, INC. (hereinafter referred to as the "Company") and the flight
attendants in the service of the Company, as represented by the INTERNATIONAL
BROTHERHOOD OF TEAMSTERS (hereinafter referred to as the "Union").

Each flight attendant in the employ of the Company shall, upon completion of
three (3) years of service, receive an amount equal to three hundred dollars
($200), subject to applicable deductions. All such payments shall be made no
later than the second paycheck following the 3rd anniversary of the Flight
Attendants' hire date with the Company.

IN WITNESS WHEREOF, the parties have signed this Agreement this _____ day of
___________, 1999.

For International Brotherhood of Teamsters     For Chautauqua Airlines, Inc.

/s/ Ray Benning                                /s/ Edward J. Wegel
------------------------------                 ------------------------------
Ray Benning, Director                          Edward J. Wegel
Teamsters Airlines Division                    President and CEO

/s/ Barry Schimmel                             /s/ Donald C. Young
------------------------------                 ------------------------------
Barry Schimmel                                 Donald C. Young
Business Agent, Local 210                      Executive Vice President and COO

/s/ Mary Schrier                               /s/ Barry Confer
------------------------------                 ------------------------------
Mary Schrier                                   Barry Confer
Chief Steward                                  Director of Inflight Services

<Page>

/s/ Lisa Paterini                              /s/ Amy Pogacnik
------------------------------                 ------------------------------
Lisa Paterini                                  Amy Pogacnik
Assistant Chief Steward                        Manager of Inflight Services

/s/ Debra Tate
------------------------------
Debra Tate
Negotiating Committee Member

<Page>

                            LETTER OF AGREEMENT NO.4

                                     between

                            CHAUTAUQUA AIRLINES, INC.

                                       and

        THE FLIGHT ATTENDANTS in the service of CHAUTAUQUA AIRLINES, INC.

                              as represented by the

                     INTERNATIONAL BROTHERHOOD OF TEAMSTERS

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

                       FLIGHT ATTENDANT JOB SHARE PROGRAM

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

THE LETTER OF AGREEMENT is made and entered into in accordance with the
provisions of the Railway Labor Act, as amended, by and between CHAUTAUQUA
AIRLINES, INC. (hereinafter referred to as the "Company") and the flight
attendants in the service of the Company, as represented by the INTERNATIONAL
BROTHERHOOD OF TEAMSTERS (hereinafter referred to as the "Union").

1.       The goal of the Flight Attendant Job Share Program is to allow two
         flight attendants to share equally either a hard or a reserve line.

2.       The Job Share positions will not exceed ten percent (10%) of the total
         flight attendant work force. However, should ten percent of the work
         force equal an odd number of positions, the number of available Job
         Share positions will be rounded up to the next even number. For
         example, a total work force of forty-nine flight attendants would yield
         four Job Share positions, but a total work force of fifty flight
         attendants would yield six such positions.

3.       Any two (2) Job Share position holders who share a line must be in the
         same domicile.

4.       For bidding purposes, Job Share position holders will accrue seniority
         in accordance with the basic Agreement.

5.       A pair of Flight attendants who are interested in transferring to
         available Job Share positions should notify the Manager of Inflight
         Services in writing. The Company will award an available Job Share
         position to the pair of flight attendants who have submitted a written
         bid for such position and who have the highest aggregate seniority. The
         Company is not required to award a bid to become or return to a
         full-time flight attendant to any flight attendant who has been in a
         Job Share position for less than six months.

6.       If a flight attendant who holds a Job Share position leaves such
         position by bidding out of such position, because her employment has
         terminated, by taking a leave of absence of

<Page>

         more than five days or for any other reason that makes the flight
         attendant unavailable for more than five days, the following will
         apply. The Company will cover the flying for which the departed or
         unavailable flight attendant had been responsible before her departure
         for up to five days following her departure. During this time, the
         Company will post a Job Share vacancy. Thereafter, the flight attendant
         who had been paired with the unavailable Job Share flight attendant
         shall be fully responsible for the Job Share line until the unavailable
         flight attendant returns to her position or another flight attendant
         has been paired with the remaining Job Share flight attendant. Although
         the Company will assist with informing other flight attendants of the
         Job Share opening, the responsibility for identifying a candidate for
         such opening will be the sole responsibility of the remaining Job Share
         flight attendant. When the remaining Job Share flight attendant has
         identified a replacement for the unavailable Job Share flight
         attendant, she should notify the Company in writing. The Company will
         use reasonable efforts to coordinate the transfer of the regular flight
         attendant to the Job Share position without disrupting the schedule.

7.       Job Share flight attendants shall bid for a line of time or reserve in
         accordance with Article 6 of the basic Agreement. The paired Job Share
         flight attendants will bid for a joint line of time or reserve in
         accordance with the seniority of the most senior flight attendant in
         the pairing. The bid sheet shall be signed by both flight attendants.

8.       The paired Job Share flight attendants shall be responsible for
         allocating and scheduling the trips on their jointly awarded line of
         flying or days of reserve coverage. No later than 1800 IND time on the
         day before the first day of each new bid month, each pair of Job Share
         flight attendants shall provide Crew Scheduling with a detailed written
         work schedule detailing such allocation. The work schedule must be
         signed by both of the paired Job Share flight attendants. If Crew
         Scheduling does not receive such detailed written work schedule by the
         deadline, the Company will assign a schedule of work and allocation of
         duties in accordance with their awarded bid line. It shall be the
         responsibility of the Job Share flight attendants to obtain the final
         confirmation of their work schedule before the new month starts. Except
         as otherwise set forth in this letter of agreement, a Job Share flight
         attendant will not be responsible for duties assigned to her Job Share
         partner. For example, if one Job Share flight attendant calls in sick,
         that work shall be covered using normal operating procedures.

9.       A Job Share flight attendant shall be compensated for all trips
         actually flown by her but will not be eligible for a monthly minimum
         guarantee.

10.      A Job Share flight attendant shall be eligible for PDOs which shall
         accrue at one-half the accrual rates set forth in Article 8 of the
         basic Agreement.

11.      A Job Share flight attendant will be eligible for flight benefits on
         the same terms as regular full-time flight attendants, including
         applicable work hour requirements.

12.      A Job Share flight attendant will be eligible for Health Plan Insurance
         benefits if she works more than one thousand forty (1040) hours in an
         anniversary year (a one-year period beginning from the flight
         attendant's date of hire). A Job Share flight attendant shall become
         eligible to receive Health Plan Insurance benefits in accordance with
         this letter of agreement in the year following her anniversary year.
         The Company will pay one-half of the Health Plan Insurance premium cost
         that it pays for a regular full-time flight attendant for each Job
         Share flight attendant, minus the flight attendant co-pay amount set
         forth in Article 14. A Job

<Page>

         Share flight attendant shall not be eligible to obtain Health Plan
         Insurance for their spouse and/or family member(s). If a Job Share
         flight attendant's employment terminates for any reason, she shall not
         be entitled to payment of any accrued benefit(s) by any unpaid
         premiums. Flex benefits are not available to Job Share flight
         attendants. If any change in the law requires the Company to incur
         additional costs attributable to Job Share flight attendants, this
         letter of agreement may be renegotiated at the discretion of the
         Company.

13.      Job Share flight attendants shall be eligible for 401k benefits if they
         work more than one thousand hours per year.

14.      Moving expenses incurred pursuant to Article 5 of the basic Agreement
         shall be payable to a Job Share flight attendant, if eligible, at a
         rate of one-half that for a regular flight attendant.

15.      The holiday bonus, profit sharing and any and all other compensation
         not specifically addressed in this letter of agreement for which a Job
         Share flight attendant claims entitlement shall be paid t each such
         entitled flight attendant, if so entitled, at a rate of one-half the
         amount that would be available to a regular flight attendant. The
         uniform allowance shall be paid to each Job Share flight attendant at
         one-half the amount owed to regular flight attendants.

16       A Job Share flight attendant shall be covered by the basic Agreement
         and shall owe to the Union the same amount of dues and other Union
         assessments, if any, that a regular flight attendant would owe in order
         to remain a member in good standing of the Union.

IN WITNESS WHEREOF, the parties have signed this Agreement this _____ day of
___________, 1999.

For International Brotherhood of Teamsters     For Chautauqua Airlines, Inc.

/s/ Ray Benning                                /s/ Edward J. Wegel
------------------------------                 ------------------------------
Ray Benning, Director                          Edward J. Wegel
Teamsters Airlines Division                    President and CEO

/s/ Barry Schimmel                             /s/ Donald C. Young
------------------------------                 ------------------------------
Barry Schimmel                                 Donald C. Young
Business Agent, Local 210                      Executive Vice President and COO

/s/ Mary Schrier                               /s/ Barry Confer
------------------------------                 ------------------------------
Mary Schrier                                   Barry Confer
Chief Steward                                  Director of Inflight Services

/s/ Lisa Paterini                              /s/ Amy Pogacnik
------------------------------                 ------------------------------
Lisa Paterini                                  Amy Pogacnik
Assistant Chief Steward                        Manager of Inflight Services

<Page>

/s/ Debra Tate
------------------------------
Debra Tate
Negotiating Committee Member<Page>

                                                                   Exhibit 10.10

                      [LOGO FOR CHAUTAUQUA AIRLINES, INC.]

                                    AGREEMENT

                                     between

                            CHAUTAUQUA AIRLINES, INC.

                                       and

                             THE FLIGHT DISPATCHERS

                                in the employ of

                            CHAUTAUQUA AIRLINES, INC.

                                as represented by

                   TRANSPORT WORKERS UNION OF AMERICA, AFL-CIO

             [LOGO FOR TRANSPORT WORKERS UNION OF AMERICA, AFL-CIO]

                      FEBRUARY 19, 2001 - FEBRUARY 19, 2007

                            Signed February 19, 2001

<Page>

                                TABLE OF CONTENTS
--------------------------------------------------------------------------------
Section    Title                                                          Page

1          Recognition and Scope...............................              4
2          Definitions.........................................              6
3          Compensation........................................              8
4          Work Schedules and Vacations........................             10
5          Seniority...........................................             13
6          Training............................................             14
7          Sick Leave..........................................             15
8          Probation...........................................             16
9          Leave of Absence....................................             17
10         Benefits............................................             18
11         Furlough and Recall.................................             19
12         Grievance Procedures................................             21
13         System Board of Adjustment..........................             24
14         Union Security......................................             27
15         General.............................................             35
16         Duration............................................             38

                                       2
<Page>

                                    AGREEMENT

                                     between

                               CHAUTAUQUA AIRLINES

                                       and

                               FLIGHT DISPATCHERS

                                in the employ of

                               CHAUTAUQUA AIRLINES

                                as represented by

                   TRANSPORT WORKERS UNION OF AMERICA, AFL-CIO

This Agreement is made and entered into in accordance with the provisions of
Title II of the Railway Labor Act, as amended by and between CHAUTAUQUA
AIRLINES, hereinafter known as the "Company", and the FLIGHT DISPATCHERS in the
service of CHAUTAUQUA AIRLINES, who are represented by the TRANSPORT WORKERS
UNION OF AMERICA, AFL-CIO, hereinafter known as the "Union". In making this
Agreement, the Company and the Union and the represented employees recognize
their duty, individually and collectively, to comply and cooperate with the
intent and purpose of this Agreement.

                                       3
<Page>

                                    SECTION 1

                              RECOGNITION AND SCOPE

A.  Recognition

The Union is recognized by the Company, in accordance with the National
Mediation Board Certification Case R-6673 dated July 22, 1999, as the duly
designated and authorized bargaining agent with respect to rates of pay, rules
and working conditions of Flight Dispatchers in the employ of the Company.

B.  Scope

It is understood and agreed that all dispatch functions as detailed in Section
II (Definitions) of this Agreement as well as, at a minimum, in the Chautauqua
Airlines, General Policies Manual, Revision 14, dated 20Jul00, will be performed
by the employees covered under this Agreement and in accordance with the terms
and conditions of this Agreement. It is specifically understood that the scope
of this work includes all FAR Part 121 flying by pilots on the Chautauqua Pilots
System Seniority List, performed in accordance with the terms and conditions of
their Agreement, with the exception of training and delivery flights.

C.  Operational efficiency

The purpose of this Agreement is, in the mutual interest of the Company and of
the employees, to provided for the operation of the services of the Company
under methods which will further, to the fullest extent possible, the safety of
air transportation, the efficiency of operation, and the continuation of the
employment under conditions of reasonable hours, proper compensation, and
reasonable working conditions. It is recognized by this Agreement to be the duty
of the Company and the employees, to cooperate fully both individually and
collectively.

D.  Management Rights

The rights of ownership, the management of the Company and the direction of the
working forces, including the right to hire, promote, demote, discharge and
discipline for cause, transfer, layoff, and recall, the right to direct, plan
and control operations, and to establish work schedules, and the right to
determine the type of work to be performed, and the right to introduce new and
improved methods, equipment or facilities, and to change existing methods,
equipment and to determine the location of the Company's facilities, and the
right to lease facilities or equipment, and the right to establish or change
Company rules, and in general to maintain discipline and efficiency, are vested
exclusively with the Company so long as the exercise of such rights shall not be
in conflict with the specific provisions of this agreement.

E.  No strike/lockout

                                       4
<Page>

It is the intent of the parties of this Agreement that the procedure set forth
herein and in the Railway Labor Act, as amended, for the resolution of disputes
shall serve as a means of peaceable settlement of all disputes that may arise
between them and that, therefore:

         1.       The Company shall neither cause nor permit any lockout of
                  employees covered hereunder during the life of this Agreement;
                  and

         2.       Neither the Union nor the employees covered hereunder, both
                  individually and collectively, shall authorize, cause,
                  sanction or engage in any strike against the Company, illegal
                  picketing of the Company's premises, slowdown, sit-down,
                  walk-off, work stoppage, or curtailment of work of any kind,
                  during the life of this Agreement.

F.  Supervisor qualification shifts/operational emergencies

It is understood and agreed that, in order to maintain their proficiency,
qualified supervisors may be scheduled up to twenty (20) hours per year to
perform the functions of a Flight Dispatcher. Qualified supervisors may also
perform the functions of a Flight Dispatcher in the event of an operational
emergency. Supervisors may not be used to avoid the payment of overtime.

It is further understood and agreed that qualified supervisors and other
employees may assist in performing the functions of a Dispatch Coordinator
necessary to complete a particular operation. Supervisors may not be used to
avoid the payment of overtime.

                                       5
<Page>

                                    SECTION 2

                                   DEFINITIONS

1.       The term "employee" shall mean an employee of Chautauqua Airlines,
         Inc., who is covered by this Agreement.

2.       The term "Dispatch Coordinator," as used herein, shall mean an employee
         selected by the Company who may perform the duties of a Flight
         Dispatcher and, in addition, is the lead Flight Dispatcher on Duty.
         This position is responsible for coordinating the day to day activities
         of flight dispatch with the appropriate departments, government
         agencies, and other effected parties, as applicable. This position will
         also have the responsibility of assuring that shift opening and closing
         procedures are completed, a shift turnover log is filled out and other
         responsibilities, as designated by the Company, are completed.

3.       The term "Flight Dispatcher," as used herein, shall mean an employee
         who has been designated as such by the Company and holds a currently
         effective Aircraft Dispatcher's Certificate, who is regularly assigned
         to be responsible for operational control concerning the dispatch,
         release and movement of Company aircraft.

4.       The term "Check Dispatcher," as used herein, shall mean an employee who
         has been designated as such by the Company to perform FAA-mandated
         competency checks of the Flight Dispatchers.

5.       The term "Relief Flight Dispatcher," as used herein, shall mean a
         Flight Dispatcher who holds a permanent position and who is required to
         work other than the normal work cycle on a pre-planned basis to cover
         known open time and in order to provide qualified relief for Flight
         Dispatchers for vacation, qualification trips and training, and any
         other abnormality as agreed to by the Union on a non-precedent setting
         case by case basis.

6.       The term "special assignment," as used herein, shall mean the
         assignment of Flight Dispatcher to duties in lieu of regular Flight
         Dispatcher activities, but such assignment must be directly related to
         the dispatch function.

7.       The term "work cycle," as used herein, shall mean the basic rotation of
         work days and regular days off established for the quarterly work
         period, prior to overlay of such factors as vacations, qualification
         flights, training, relief schedules, etc.

8.       The term "bid line" as used herein, shall mean the specific assignment
         of individual employees by calendar quarter to a work cycle, adjusted
         for such

                                       6
<Page>

         factors as vacations, qualification, training relief schedules, etc.
         The bid lines shall be subject to quarterly bidding procedures.

9.       The term "Work Schedule," as used herein, shall mean a cycle of
         workdays and days off, developed by the Company, to which an individual
         Flight Dispatcher is assigned.

10.      Wherever the term "Flight Dispatcher" appears in this Agreement, the
         provisions of the paragraph in which it appears shall apply to Dispatch
         Coordinators, Flight Dispatchers, Check Dispatchers and Relief Flight
         Dispatchers, unless otherwise stated.

                                       7
<Page>

                                    SECTION 3

                                  COMPENSATION

A.       Minimum Rates of Pay per Hour

<Table>
<Caption>
             Longevity   Salary at  DOS plus   DOS plus   DOS plus   DOS plus
                          signing    1  year    2 years    3 years    4 years
         -----------------------------------------------------------------------
<S>                        <C>       <C>         <C>       <C>        <C>
             Hire date     11.15     11.49       11.83     12.19      12.55
              6 Months     11.46     11.80       12.16     12.52      12.90
               1 Year      11.67     12.02       12.38     12.75      13.14
           1 1/2 Years     11.93     12.28       12.65     13.03      13.42
              2 Years      12.25     12.62       13.00     13.39      13.79
              3 Years      12.72     13.10       13.49     13.90      14.32
              4 Years      13.17     13.56       13.97     14.39      14.82
              5 Years      13.65     14.06       14.48     14.92      15.37
              6 Years      14.18     14.61       15.05     15.50      15.96
              7 Years      14.84     15.29       15.74     16.22      16.70
              8 Years      15.13     15.58       16.05     16.53      17.03
              9 Years      15.44     15.90       16.38     16.87      17.38
              10 Years     15.74     16.21       16.70     17.20      17.72
              11 Years     16.15     16.63       17.13     17.65      18.18
</Table>

       Any Flight Dispatcher(s) currently on the Chautauqua Flight Dispatcher
       Seniority List whose pay falls below that of a any newly-hired Flight
       Dispatcher(s) that is (are) brought in above minimum salary levels
       outlined above, shall have his/her pay rate adjusted to that of the newly
       hired Flight Dispatcher (s).

       Employees with more than twenty (20) years of active service will receive
       premium pay as follows: $.50 per hour per year to a maximum of $2.50.

B.       Overtime

         1.       Overtime will be at time and a half (1.5 times a Flight
                  Dispatcher's applicable hourly rate) when a Flight
                  Dispatcher's time worked (including vacation and sick time) is
                  in excess of eighty (80) hours within a single pay period.

         2.       In the event that the Company is unable to cover an open shift
                  with overtime, the Company reserves the right to assign the
                  shift to the most junior, available, qualified Flight
                  Dispatcher.

C.       Holiday Pay

         1.       Holidays eligible for holiday pay are those identified in the
                  most current Chautauqua Human Resources Policies and Benefits
                  Manual, dated 06Jun96.

                                       8
<Page>

         2.       All Flight Dispatchers will receive eight (8) hours of
                  straight time pay on the holidays listed in paragraph C1 of
                  this Section.

         3.       Flight Dispatchers who work on the holidays designated above
                  will, in addition to the pay provided for in paragraph C2, be
                  compensated at the rate of 1.5 times their hourly rate for all
                  hours worked on the holiday.

D.       Override for Dispatch Coordinator

         1.       Effective on the date of signing, a Flight Dispatcher shall
                  receive an override of $.75 per hour while working the
                  Dispatch Coordinator position.

         2.       Effective on January 1, 2003, this override shall increase to
                  $1.25 per hour.

E.       On-The-Job Training Pay

         Flight Dispatchers who perform on-the-job training of new, unqualified
         Flight Dispatchers shall be compensated at a rate $.60 per hour higher
         than their current salary while performing such training.

F.       Check Dispatcher Qualification

         Effective on the date of signing, a Flight Dispatcher qualified as a
         Check Dispatcher shall receive an override of $.60 per hour while
         performing Flight Dispatcher competency checks.

                                       9
<Page>

                                    SECTION 4

                           WORK SCHEDULES AND VACATION

A.       Work Schedules

         Work Schedules, designated as either fixed or relief, are based on days
         on and days off and are determined and planned by the Company in
         accordance with the provisions outlined below.

B.       Fixed Work Schedules

         1.       Work Cycles which are fixed in nature shall be composed of
                  four (4) consecutive workdays followed by three (3)
                  consecutive days off.

         2.       Workdays within a fixed work cycle shall be planned as ten
                  (10) hour shifts (inclusive of shift overlap).

         3.       For the purpose of bidding a fixed work cycle, a proposed Work
                  Schedule shall be published a minimum of forty-five (45) days
                  in advance of each calendar quarter for the following ninety
                  (90) days.

         4.       The awards of bid lines for the fixed Work Cycles shall be
                  posted a minimum of thirty (30) days before each calendar
                  quarter for the following ninety (90) days.

C.       Relief Work Schedules

         1.       Relief Work Schedules shall be composed of a mixture of
                  variable days on and variable days off, but shall not exceed
                  one-hundred and sixty (160) hours in a four week period and
                  the Company shall strive to create as many 4/3 work cycles as
                  possible.

         2.       In the event that operational requirements necessitate, the
                  company may, with fourteen (14) days prior notice, add a bid
                  line (or bid lines) that does not follow the basic work cycle
                  outlined in Section 4 (A). The basic work cycle and schedule
                  for this (these) line(s) shall be five (5) days of work, with
                  no shift scheduled for more than eight hours (8), followed by
                  two (2) days off.

         3.       For the purpose of bidding a relief Work Cycle, a proposed
                  Work Schedule shall be published a minimum of fourteen (14)
                  days in advance for the following calendar month.

         4.       The awards of bid lines for the relief Work Cycles shall be
                  posted a minimum of seven (7) days before the first day of the
                  following calendar month.

                                       10
<Page>

D.       Training

         For the purposes of training only, a Flight Dispatcher working a fixed
         work cycle may be moved off his/her fixed rotation with a minimum of
         thirty (30) days notice.

E.       Ratio of Fixed and Relief Lines

         1.       A minimum of fifty (50) percent of the bid lines within the
                  department shall be fixed lines as outlined in this Section.

         2.       A maximum of fifty (50) percent of the bid lines within the
                  department may be relief lines as outlined in this Section.

F.       Schedule start time changes

         1.       In the event that operational requirements necessitate, such
                  as a permanent flight schedule change or charter operation,
                  the Company may, with seven (7) days prior notice, change the
                  start time of a shift by up to two hours.

         2.       Nothing in this Section will prevent the Company from changing
                  a Flight Dispatcher's Work Schedule to accommodate assigned
                  classroom training or specific familiarization flights
                  assigned by the Company. There must be a minimum ten (10) hour
                  break between training and other assignments.

         3.       Shift start times may be rotated as outlined in F. 1. above,
                  but there shall not be more than one change creating two
                  different shift start times within a five (5) day period. The
                  Company shall endeavor to publish consistent rotation of shift
                  start times for the work schedules developed for bidding and
                  the work schedules published. Such rotation is subject to
                  change by the Company in accordance with F. 1. above.

G.       Schedule Evaluation Meeting

         1.       A meeting between the Company and the Union shall be held on
                  or before March 1st, 2003, in order to evaluate the
                  flexibility and feasibility of revising the items contained in
                  Paragraphs A through D above.

         2.       Any change to such items must be agreed to by both the Company
                  and the Union and revised by Letter of Agreement.

H.       Extraordinary Circumstances

                                       11
<Page>

         If, due to an extraordinary event, changes are necessary to the fixed
         or relief work schedules that have already been awarded, the Company
         will meet with the Union to seek input as to how best implement a
         re-bid.

I.       Vacation

         1.       Flight Dispatchers shall receive vacation in accordance with
                  the provisions of the Benefits Section of the Chautauqua Human
                  Resources Policies and Benefits Manual, dated 6/6/96. The
                  number of vacation hours shall not be reduced below those set
                  forth therein.

         2.       Vacations will be bid no later than the 15th day of the month
                  prior to each calendar quarter. Awards will be subject to
                  operational requirements and awarded in seniority order, as
                  reflected on the Chautauqua Flight Dispatcher Seniority List.

         3.       At the time vacations are bid, employees may defer four (4)
                  days annually of his/her vacation entitlement to be utilized
                  as single vacation days ("DAT"). Such days must be utilized
                  within the calendar year. Requests to utilize DAT days must be
                  made fifteen (15) days in advance of the required
                  publication/posting date of the monthly work schedule. DAT
                  awards will be subject to operational requirements and must be
                  taken after use of regular vacation bids.

         4.       Vacation days remaining but not yet used by the December 15th
                  bid of each year may be carried over to the next calendar
                  year, to a maximum carryover of 40 hours.

                                       12
<Page>

                                    SECTION 5

                                    SENIORITY

A.  Chautauqua Flight Dispatcher Seniority List

Dispatch employees holding an Aircraft Dispatcher Certificate shall be placed on
the Chautauqua Flight Dispatcher Seniority List in order of their hire date as a
Flight Dispatcher. Should two (2) or more employees have the same seniority
date, they shall be placed on the Chautauqua Flight Dispatcher Seniority List in
order of their birth date with the oldest being listed first.

B.  Accrual

Seniority shall continue to accrue until such time as the employee separates
from the Company or as otherwise provided in this Agreement.

C.  Dispatch Management

Dispatch Management shall be listed on the Chautauqua Flight Dispatcher
Seniority List in order of their hire date into a Flight Dispatcher position.

D.  Management Seniority

Managers shall retain and continue to accrue seniority while in a managerial
position.

E.  Displacement Protection

No Flight Dispatcher on the Chautauqua Flight Dispatcher Seniority List shall be
displaced or furloughed as the result of any manager or supervisor returning to
a dispatch position.

F.  Managerial Exemption

Dispatch management shall not be entitled to utilize the provisions of Sections
12 or 13 of this Agreement. This shall apply to both discipline and contract
interpretation issues.

G.  Posting

The Company shall update and distribute the Chautauqua Flight Dispatcher
Seniority List annually to the Union and all Flight Dispatchers during January
of each year.

                                       13
<Page>

                                    SECTION 6

                                    TRAINING

A.  Required Training

Flight Dispatchers may be assigned to attend training on their days off provided
that such training shall not result in a Flight Dispatcher being scheduled for
more than six (6) consecutive days. Pay for training accomplished on days off
shall be compensated at the overtime rate.B. Route Familiarization Flights

Route familiarization shall be accomplished on workdays if possible or, if on
days off, will be compensated at the overtime rate. The Company shall provide
hotel accommodations, when applicable, and paid expenses in accordance with
Company Policy.

C.  Dispatch Management

Flight Dispatchers assigned by the Company as a Check Dispatcher during a shift
shall receive additional compensation as set forth in Section 3E of this
Agreement.

                                       14
<Page>

                                    SECTION 7

                                   SICK LEAVE

A.  Paid Sick Time

Flight Dispatchers shall receive paid sick time in accordance with the
provisions of the Chautauqua Human Resources Policies and Benefits Manual, Dated
06Jun96. The number of annual sick hours and the maximum sick bank hours shall
not be reduced below the levels set forth in the Human Resources Policies and
Benefits Manual, dated 06Jun96.

B.  Sick Pay Bank

The maximum six-hundred sixty (660) hour Sick Pay Bank may be accrued pursuant
to the table below. The maximum sick bank is divided into accounts of
three-hundred sixty (360) and three-hundred (300) hours. Only after accruing the
maximum three-hundred sixty hours (360) 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 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.

<Table>
<Caption>
              Years of Service      Pay Period Accrual      Annual Accrual
            --------------------- ----------------------- -------------------
<S>                                     <C>                    <C>
                  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              2.77 Hours             72 Hours
</Table>

                                       15
<Page>

                                    SECTION 8

                                    PROBATION

A.  Probation

An employee shall be on probation for his/her first six (6) months of active
service with the Company as a Flight Dispatcher.

B.  Adjustments to Length

Time off due to sickness, injury, leave of absence, furlough or discipline will
not be counted toward completion of the active service requirement for
completion of an employee's probationary period.

C.  Applicability

A Flight Dispatcher on probation shall not be entitled to utilize the grievance
and/or System Board procedures of this Agreement for any disciplinary action,
including discharge. In any case, should a Flight Dispatcher on probation be
afforded a grievance or System Board hearing, by law or otherwise, the Company
shall not be required to prove "just cause" in any disciplinary or discharge
grievance or System Board hearing.

                                       16
<Page>

                                    SECTION 9

                                LEAVE OF ABSENCE

A.  Leave of Absence

When requirements of service will permit, an employee hereunder may be granted a
leave of absence in accordance with Company policy, as stated in the Human
Resources Policies and Benefits Manual, dated 06Jun96.

                                       17
<Page>

                                   SECTION 10

                                    BENEFITS

A.  Benefits

Flight Dispatchers shall be provided a minimum level of coverage as outlined in
the Health Benefits Section of the Chautauqua Human Resources Policies and
Benefits Manual, dated 6/6/96.

                                       18
<Page>

                                   SECTION 11

                               FURLOUGH AND RECALL

A.  Involuntary Furlough

       1.     The Company shall notify the Union prior to official announcement
              and implementation of a furlough of Flight Dispatchers.

       2.     In the event of a furlough, Flight Dispatchers will be furloughed
              in inverse order of seniority from the Chautauqua Flight
              Dispatcher Seniority List.

       3.     The Company shall provide fifteen (15) days notification of
              furlough or pay in lieu thereof, except in case of emergency, act
              of God, or where there is no work because of a labor dispute, or
              other circumstances over which the Company has no control.

       4.     A furloughed Flight Dispatcher shall retain all seniority and
              longevity accrued prior to the time of furlough for a period not
              to exceed three (3) years. He/She shall continue to accrue
              seniority but not longevity while on furlough. At the time of
              furlough, Flight Dispatchers must provide the proper contact
              information to Flight Operations management.

       5.     A furloughed Flight Dispatcher shall retain medical coverage, as
              provided prior to furlough, for a period of sixty (60) days
              following the date of furlough. Flight Dispatchers with less than
              24 months of service at the time of furlough shall be responsible
              to pay the employer portion of the medical cost during the sixty
              (60) day period.

       6.     Flight Dispatchers on furlough for less than thirty (30) days
              shall continue to accrue longevity for benefit and pay purposes
              during the period on furlough.

       7.     Flight Dispatchers who remain on furlough at the end of three (3)
              years from the effective date of the furlough shall be released
              from employment with Chautauqua Airlines, and their names shall be
              deleted from the Chautauqua Flight Dispatcher Seniority List.

B.  Recall

       1.     The Company shall notify the Union prior to official announcement
              and implementation of a recall of Flight Dispatchers.

       2.     Flight Dispatchers shall be recalled in order of seniority from
              the Chautauqua Flight Dispatcher Seniority List.

                                       19
<Page>

       3.     A written recall notice shall be sent to each Flight Dispatcher
              entitled to recall to the last address provided to the Company. A
              Flight Dispatcher shall be given fifteen (15) days from his/her
              receipt of the notice of recall to return to duty, and must notify
              Flight Operations within ten (10) days from the date of receipt of
              the written recall notice of his/her response to the recall on the
              date specified in the recall notice. Upon request, a recalled
              Flight Dispatcher shall have the fifteen (15) day period to report
              for duty extended for a period of up to an additional period of
              fifteen (15) days (i.e. to a maximum of 30 days from receipt of
              notice of recall) should the Flight Dispatcher need the additional
              time to relocate in order to resume his/her position as a
              Chautauqua Flight Dispatcher.

       4.     The Company shall make a reasonable effort to provide space
              available air transportation on Chautauqua aircraft to Flight
              Dispatchers being recalled.

       5.     If the Company is unable to contact a furloughed Flight Dispatcher
              for recall or if the Flight Dispatcher fails to notify the Company
              of his/her response by the deadline date, the Company will
              consider the Flight Dispatcher to have voluntarily resigned
              his/her employment with Chautauqua Airlines, Inc.

       6.     Flight Dispatchers on furlough shall retain recall rights for up
              to three (3) years from the date of furlough and thereafter shall
              be released from full-time employment with Chautauqua Airlines,
              Inc.

C.       Severance

       1.     In the event of a reduction in force or when the Company decides
              to close a station, Flight Dispatchers at that station, with at
              least one (1) year of service as a Flight Dispatcher, who decide
              not to transfer to another station will receive eighty (80) hours
              of severance pay, at the employee's current hourly rate.

       2.     In addition to the eighty (80) hours outlined in A. above, Flight
              Dispatchers shall receive additional hours of severance pay in
              accordance with the schedule below:

<Table>
<Caption>
                  Yrs. of Service   Number of Additional Hrs. for Each Yr of Service
                  ---------------   ------------------------------------------------
<S>                                                  <C>
                  For Years 1-10                     Eight (8) Hours
                  For Years 11-15                    Sixteen (16) Hours
                  For Years 15+                      Twenty-Four (24) Hours
</Table>

                                       20
<Page>

                                   SECTION 12

                              GRIEVANCE PROCEDURES

       A.     A grievance is defined as a claim or dispute by an employee or
              group of employees covered by this Agreement concerning the
              interpretation and/or application of the Agreement or disciplinary
              or discharge action taken against the employee.

       B.     Grievances Other Than Those Involving Discipline and Discharge

              PRE-GRIEVANCE DISCUSSION

              Any employee covered by this Agreement who believes that he/she
              has a grievance concerning the meaning or application of the terms
              of the Agreement shall, within fifteen (15) days after the
              employee has, or reasonably should have had, knowledge of the
              matter giving rise to the grievance, request an informal
              discussion with the Dispatch Manager, or his/her designee to
              attempt to resolve the dispute. The employee shall present his/her
              grievance in person. The Dispatch Manager, or designee, shall meet
              with the employee within ten (10) days of receiving a request for
              a discussion. The employee is permitted to have present a Union
              representative of his/her choice at the meeting.

              STEP 1

              Should the result of the pre-grievance discussion be
              unsatisfactory to the employee or should the discussion fail to
              take place within the ten day period, the employee may file a
              grievance in writing to the Director of System Operations Control.
              Such grievance shall be filed within ten (10) days of the
              pre-grievance discussion deadline. The written grievance shall
              include a statement of the facts of the grievance and list the
              section(s) of the Agreement that relate to the dispute. The
              Director of System Operations Control, or designee (a person other
              than the person who conducted the pre-grievance discussion), shall
              investigate the grievance and provide a written response within
              fifteen (15) days of receipt of the grievance. Should the employee
              find the decision of the Director of System Operations Control, or
              designee, unsatisfactory, the grievance may be appealed to Step 2.
              The appeal to Step 2 shall be made in writing within thirty (30)
              days of the employee's receipt of the Step 1 decision.

              STEP 2

              Representatives for the Union and the Company shall meet once each
              calendar

                                       21
<Page>

              quarter to discuss and attempt to resolve all grievances
              appealed to Step 2. All resolutions of grievances at Step 2
              shall be final and not subject to further appeal. Should the
              Union and Company representatives be unable to reach agreement
              on a resolution to a grievance, the Union may appeal the
              grievance to the Chautauqua Dispatchers' System Board of
              Adjustment within sixty (60) days of the Step 2 meeting in
              accordance with the procedures set forth in Section 15 of the
              Agreement.

       C.     Grievances Involving Discipline and Discharge

              STEP 1

              All actions by the Company concerning the discipline or discharge
              of an employee covered by this Agreement shall be confirmed in
              writing to the employee with a copy of such written confirmation
              supplied to the Union. An employee may, within five (5) days of
              receipt of written confirmation of the discipline or discharge
              file an appeal of the Company's action with the Director of System
              Operations Control. The Director of System Operations Control, or
              designee, shall investigate the facts related to the discipline or
              discharge and render a written decision to the employee with a
              copy to the Union within fifteen (15) days of receipt of the
              appeal. Should the decision of the Director of System Operations
              Control, or designee, be unsatisfactory to the employee, the
              dispute may be appealed by the employee to Step 2. The appeal to
              Step 2 shall be made in writing within fifteen (15) days of the
              employee's receipt of the Step I decision.

              STEP 2

              Representatives for the Union and the Company shall meet once each
              calendar quarter to discuss and attempt to resolve all grievances
              appealed to Step 2. All resolutions of grievances at Step 2 shall
              be final and not subject to further appeal. Should the Union and
              Company representatives be unable to reach agreement on a
              resolution to a grievance, the Union may appeal the grievance to
              the Chautauqua Dispatchers' System Board of Adjustment within
              sixty (60) days of the Step 2 meeting in accordance with the
              procedures set forth in Section 15 of the Agreement.

D. General

     1.    All written communication required by this Section shall be either
           delivered in person, with a signature and date confirming receipt, or
           shall be sent by certified mail with a return receipt.

     2.    The Company shall inform an employee in advance of any meeting with
           such employee that may result in discipline or discharge. Nothing
           herein shall be construed to restrict the right of an employee
           covered by this Agreement to have

                                       22
<Page>

            a Union Representative present during any meeting concerning
            discipline or discharge.

     3.     All "days" as referred to in this Section are calendar days.

     4.     The time limits specified herein may be extended by mutual agreement
            between the Company and the Union.

                                       23
<Page>

                                   SECTION 13

                         SYSTEM BOARD OF ADJUSTMENT

       A.     Establishment and Purpose

              In compliance with Section 204, Title 11, of the Railway Labor
              Act, as amended, there is hereby established a System Board of
              Adjustment for the purpose of adjusting and deciding disputes
              which may arise under the terms of this Agreement and which are
              properly submitted to it. This board shall be known as the
              Chautauqua Dispatchers' System Board of Adjustment (hereinafter
              referred to as the "Board").

       B.     Composition of the Board

              1.    The Board shall consist of one (1) member appointed by the
                    Company and one (1) member appointed by the Union. A third
                    member shall be added to the Board to serve as a neutral
                    referee for the purpose of hearing an arbitration conducted
                    pursuant to this Section. The Company and the Union shall
                    advise each other in writing of the name, position, address
                    and phone number of their initial appointments to the Board
                    and any subsequent replacement appointments.

              2.    A Chairperson and Vice Chairperson of the Board will be
                    selected from the Board members. The office of Chairperson
                    shall alternate yearly between the Company Board member and
                    the Union Board member, with the Chairperson position being
                    held by the Union-appointed Board member in even-numbered
                    years. Whenever the position of Chairperson is filled by a
                    Company-appointed Board member, the position of Vice
                    Chairperson shall be filled by the Union-appointed Board
                    member and vice versa.

              3.    Whenever the Board is convened to hear an arbitration, the
                    Company and Union may elect to appoint an alternate to serve
                    as a Board member for the arbitration.

              4.     The appointment of a neutral referee shall be by mutual
                     agreement between the parties from the panel described in
                     paragraph G below or, if the parties are unable to reach
                     agreement, by the alternate strike method whereby each
                     party shall alternately strike the name of a panel member
                     with the last remaining panel member being the neutral
                     referee for the subject arbitration.

       C. Jurisdiction of the Board

                                       24
<Page>

              The Board shall have jurisdiction over and shall consider all
              disputes properly submitted to it that are covered under the terms
              of this Agreement and that arise through grievance out of disputed
              interpretations or applications of this Agreement or that involve
              discipline or discharge. The jurisdiction shall not extend to
              proposed changes in hours of employment, rates of compensation, or
              working conditions nor shall the Board have the authority to alter
              the express terms of this Agreement.

       D.     Submission of Disputes

              Disputes properly submitted to the Board shall be addressed to the
              Chairperson with copies to the Vice Chairperson and the Vice
              President-Flight Operations. The written appeal shall include:

              o The grievant's name and address,

              o A statement of the question at issue,

              o A summary of the facts giving rise to the grievance,

              o A statement setting forth the position of the grievant,

              o A statement setting forth the position of the Company,

              o The relief sought, and

              o A copy of the Step 2 decision.

       E.     Convening the Board

              The Board will docket a grievance for an arbitration at the
              earliest date of availability for the selected arbitrator but not
              earlier than thirty (30) days from the date of filing with the
              Board Chairperson unless the parties mutually agree to an earlier
              date. Arbitrations involving the discharge of an employee shall be
              docketed for hearing within ninety (90) days from the date of
              filing with the Board Chairperson unless the parties mutually
              agree to a later date.

       F.     Decisions of the Board

              Decisions of the Board shall be by a majority vote and shall be
              final and binding on all parties.

       G.     Neutral Referees

                                       25
<Page>

              1.    The Company and the Union shall select a panel of nine (9)
                    neutral referees (arbitrators) who will serve as the third
                    member of the Board for the purpose of conducting
                    arbitrations. The selection of the panel shall be by mutual
                    agreement between the Company and the Union. If the parties
                    are unable, within sixty (60) days from the signing of this
                    Agreement, to agree on a full panel, the Chairperson and
                    Vice Chairperson of the Board shall mutually petition the
                    National Mediation Board and/or the American Arbitration
                    Association for the names of three arbitrators for each
                    unfilled position on the panel. Upon receipt of the names,
                    the Company and the Union shall attempt to mutually agree on
                    a member from each group of three names. In the event the
                    parties are unable to mutually agree within ten (10)
                    business days of receipt of the names, each remaining open
                    position shall be filled utilizing the alternate strike
                    method with each group of three names. The last remaining
                    name in each group shall fill the applicable open position
                    on the panel.

              2.    Once the panel is established, the Company and the Union may
                    mutually agree to change the membership of the panel at any
                    time. Further, either the Company or the Union may
                    unilaterally remove a member from the panel, provided the
                    panel member is not serving as the neutral referee for an
                    arbitration that has commenced. The Company or the Union may
                    not exercise a unilateral removal more often than once in
                    any six (6) month period.

       H.     Board Records

              The Board shall maintain a complete record of all matters properly
              submitted to it and of all findings and decisions made by it. The
              aforementioned "complete record" does not necessarily include a
              stenographic transcript of all testimony of all witnesses who
              appear before the Board.

       I.     Hearings

              1.    Arbitration hearings shall be conducted in Indianapolis,
                    Indiana unless the Company and the Union mutually agree to
                    an alternate location.

              2.    The parties should attempt to agree on a statement of issue
                    to present to the Board prior to the commencement of the
                    hearing. Should they be unable to agree, both parties shall
                    submit their version of a statement of issue and shall
                    provide the other party no later than the day prior to the

                                       26
<Page>

                    arbitration with a copy of the statement of issue they
                    intend to submit to the Board.

              3.     The parties should utilize joint exhibits whenever
                     possible.

       J.     General

              1.    All members of the Board shall be free to discharge their
                    duties in an independent manner and witnesses shall be free
                    to testify without fear of recrimination by either of the
                    parties.

              2.    Each party will assume the expenses of its Board member, or
                    alternate, and its own witnesses.

              3.    When it is mutually agreed that a stenographic transcript is
                    to be made of a hearing, one-half the costs shall be borne
                    equally by each party. Should one of the parties have
                    stenographic transcript made, that party shall pay the
                    complete cost of the transcript. The other party shall,
                    however, be provided with a copy of the transcript upon
                    request by paying one-half of the costs.

              4.    Costs associated with a hearing (e.g. hearing room rental,
                    the arbitrator's fees and expenses) shall be borne equally
                    by the Company and the Union.

                                       27
<Page>

                                   SECTION 14

                                 UNION SECURITY

A.       Conditions

     1.  Each employee now or hereafter employed as a Flight Dispatcher under
         this Agreement shall, as a condition of continued employment in such
         work, within sixty (60) days following the beginning of such employment
         or the effective date of this Section, whichever is later, become a
         member of, and thereafter maintain membership in good standing (as
         herein defined) in the Union, except as provided otherwise herein. Such
         condition shall not apply with respect to any employee to whom such
         membership is not available upon the same terms and conditions as are
         generally applicable to any other member of his/her classification, or
         with respect to any employee to whom membership is denied or terminated
         for any reason other than the failure of the employee to tender the
         dues uniformly required of other members of his/her classification as a
         condition of acquiring or retaining membership.

     2.  The condition of payment shall be met if the amount due is tendered to
         the Treasurer of the Union in person or is mailed to him/her within the
         prescribed time limits.

     3.  For the purpose of this Section, "membership in good standing in the
         Union" shall consist of the payment by the employee, not later than the
         last day of the second following calendar month, of dues for each
         calendar month, initiation fees and assessments (not including fines
         and penalties), which are uniformly required of his/her classification
         as a condition of acquiring or retaining membership.

     4.  The employee may have his/her monthly membership dues deducted from
         his/her earnings as provided in paragraph B1 of this Section, or he/she
         may pay his/her membership dues directly to the Union. Initiation fees
         must be paid directly to the Union.

     5.  Any employee who fails to voluntarily acquire and maintain membership
         in the Union shall not be required, as a condition of continued
         employment, to become a member of the Union as set out in this section.
         Such employee shall be required, beginning sixty (60) says following
         the beginning of employment as a Flight Dispatcher or the effective
         date of this Section, whichever is later, to pay the Union each month a
         service charge equal to the Union's regular and usual dues. Any such
         employee who, subsequent to the effective date of this Section and
         during the term of this Agreement, joins the Union, must thereafter
         maintain his/her membership in the Union as provided in this Section.

                                       28
<Page>

     6.  Notwithstanding any other provisions contained in this Agreement, if
         any person is transferred or promoted to a position in which he/she is
         not covered by this Agreement, the provisions of this Section shall be
         inoperative as to such employee. This paragraph shall not apply to an
         employee who is transferred or promoted on a "Temporary" or "Acting"
         basis.

     7.  When any person holding seniority under this Agreement returns to a
         position covered by this Agreement from furlough, leave of absence,
         military leave, or a position in which he/she was not covered by this
         Agreement, the appropriate provisions of this Section shall, at time of
         return, apply in the same manner as if he/she had been actively
         employed in such position on the effective date of this Section.

     8.  When an employee becomes delinquent by not meeting the requirements of
         this Section for "membership in good standing in the Union," or
         paragraph 5 above, the following procedure shall be observed.

         (a)      The Treasurer of the Union shall notify the employee by
                  certified mail, return receipt requested, copy to the
                  Company's Vice President-Flight Operations, that the employee
                  is delinquent in the payment of dues as specified herein and
                  accordingly is subject to discharge as an employee of the
                  Company. Such letter shall also notify the employee that
                  he/she make the required payments within thirty (30) calendar
                  days of the date of mailing of the notice or be subject to
                  discharge under the terms of this Agreement. If the notice
                  above is not received by the employee or is delayed in
                  reaching such employee as the result of the employee's failure
                  to keep both the Company and the Union informed as to his
                  correct mailing address, no extension in the time limit
                  specified in the original notice is required.

         (b)      Upon the expiration of the thirty (30) day period following
                  the mailing of the notice in subsection 8(a) above, if the
                  employee still remains delinquent the Treasurer of the Union
                  may certify in writing to the Company's Vice President-Flight
                  Operations that the employee has failed to make the required
                  payment within the thirty (30) day grace period and is,
                  therefore, to be discharged.

         (c)      Within fifteen (15) days after receipt by the Company of the
                  Union's certified notice in subsection 8(b) above that the
                  employee is to be discharged, the Company shall discharge the
                  employee from its services for failure to pay or to tender
                  dues or service charges as required under this Section.

     9.  Appeal

         (a)      If the employee discharged or to be discharged under this
                  Section contends that he/she is not properly subject to
                  discharge under the terms of this

                                       29
<Page>

                  Section he/she may protest such action to the Chautauqua
                  Flight Dispatcher's System Board of Adjustment provided that
                  such protest in writing is mailed to the Board within (10)
                  days after the date the employee is notified of such action.
                  This protest shall be submitted in duplicate to the Chairman
                  of the System Board of Adjustment, with one copy to be mailed
                  of the Vice President-Flight Operations, at such address as
                  he/she may from time to time designate, and the other copy to
                  be mailed in care of the Treasurer of the Union. The letter to
                  the Chairman of the Board and both copies shall be sent by
                  registered mail, return receipt requested. In the event no
                  protest is so filed within the above time limits, the action
                  will be considered as proper and will be final and binding
                  upon all parties concerned. Within thirty (30) days of receipt
                  of such a protest, the System Board of Adjustment will meet
                  and consider the dispute. A representative of the Company, a
                  representative of the Union, and the employee affected will be
                  allowed to present to the Board all evidence and argument
                  pertinent to the issue. Prior to the expiration of the workday
                  following such Board meeting, the Board will issue either a
                  majority decision or a notice of deadlock. If a majority
                  decision is issued, it will be final and binding upon all
                  parties concerned. If a deadlock is reached, and if at the
                  time of the deadlock the Board cannot agree upon a neutral to
                  sit with the Board to decide the dispute, the Board will
                  immediately request the National Mediation Board to appoint a
                  neutral, and the Board will meet with him/her at the earliest
                  opportunity and decide the dispute. At the meeting the Board,
                  sitting with a neutral, a representative of the Company, a
                  representative of the Union, and the employee affected, will
                  be allowed to present to the Board all evidence and arguments
                  pertinent to the issue. A majority decision of the Board,
                  including the neutral, will be issued within thirty (30) days
                  after such meeting and will be final and binding upon all
                  parties concerned. The expenses and reasonable compensation of
                  the neutral selected as provided herein shall be borne equally
                  by the parties to this Agreement.

         (b)      The provisions of Section 12 shall not apply to disputes
                  arising under this Section, and the provisions of this
                  Agreement establishing a System Board of Adjustment shall
                  apply to such disputes except as they are superseded by the
                  above provisions relating to procedure for handling disputes.

         (c)      The effective date of an employee's discharge under this
                  Section will be held in abeyance during the time that a
                  dispute is unsettled as to whether or not the individual is
                  properly employed under the provisions of the Section. If a
                  decision is made that the employee should be discharged, the
                  discharge shall be effected the day following the issuance of
                  the decision. In the event a reduction in force occurs during
                  such time as an employee's status is being protested under the
                  provisions of this Section, such employees will considered as
                  having seniority under this Agreement for purposes of
                  effecting the reduction.

                                       30
<Page>

10.      Time limits specified in this Section may be extended in individual
         cases only, and then only by written agreement between the Company and
         the Union.

11.      An employee discharged under the provisions of this Section shall be
         deemed to have been "discharged for just cause" within the meaning of
         the terms of this Agreement.

12.      All letters and notices provided for by this Section shall be sent by
         registered mail, return receipt requested. Such letters and notices or
         copies sent to the Union shall be addressed to the Treasurer of the
         Union at such address as he/she may from time to time designate. Such
         letters and notices or copies sent to the Company shall be addressed to
         the Company's Vice President-Flight Operations at such address as
         he/she may from time to time designate.

13.      Nothing in this Section shall require the Company to terminate the
         employment of any employee until the services of a qualified
         replacement are available except that the provisions of this paragraph
         will not permit the Company to retain an employee in its employment in
         excess of ninety (90) calendar days from the date of the Union's notice
         given pursuant to the paragraph A(8)(c) of this Section.

14.      For the purposes of this Section, when an employee is discharged or
         resigns and he/she returns more than twelve (12) months from the date
         of discharge or resignation, he/she will be considered as a new
         employee for purposes of this Agreement.

15.      Both the Union and the Company, or either of them, shall have the right
         at any time, to notify individual employees directly of any provisions
         of this Agreement.

16.      When new employees are hired or transferred into classifications
         covered by this Agreement the Company will furnish monthly to the Union
         the names, classification, point of employment and payroll register
         number of such new employees. The Company will furnish to the Union the
         names, present and previous classification, point of employment and
         payroll register number of all employees who may transfer out of
         classifications covered by this Agreement; in addition, the Company
         will furnish to the Union the names, location, payroll register number
         and status of employees covered by this Agreement who terminate their
         payroll status for any reason, such listing will be furnished monthly.

B.  DUES CHECK - OFF

1.       During the life of this Agreement the Company will deduct from the pay
         of each Flight Dispatcher and remit to the Union monthly membership
         dues or service charges uniformly levied in accordance with the Railway
         Labor Act, as amended, and the constitution and bylaws of the Union,
         provided such Flight Dispatcher voluntarily executes the agreed form,
         which is hereinafter included in this Agreement to be known as
         "check-off form," which shall be prepared and furnished

                                       31
<Page>

         by the Union. The Company will not be required to deduct monthly
         membership dues from the pay of employees covered by this Agreement
         unless the Company has received a check-off form and has not received a
         notice of revocation thereof.

                          ASSIGNMENT AND AUTHORIZATION
                            FOR CHECK-OFF UNION DUES

                  TO CHAUTAUQUA AIRLINES

                  I, ___________, hereby assign to the Transport Workers
                  Union of America, AFL-CIO, Union dues from any wages earned
                  or to be earned by me as your employee and authorize and
                  direct you to deduct the sum of $___________ each month,
                  which are the monthly membership dues (or such monthly
                  membership dues as may hereinafter be established by the
                  Union as dues for employees in my present or future
                  classification under the Agreement upon notification to the
                  Company by the Treasurer of the Union) from one pay check
                  per month and to remit same to the Treasurer of the Union.
                  This assignment and authorization may be revoked by me in
                  writing after the expiration of one (1) year from this
                  date, or upon the termination date of the applicable
                  collective bargaining agreement between CHAUTAUQUA
                  AIRLINES, and the Union in effect at the time this is
                  signed, whichever occurs sooner. This authorization and
                  direction is made subject to the provisions of the Railway
                  Labor Act, as amended, and in accordance with existing
                  Agreement between the Union and the Company.

                  Employee Payroll No.

                  Job Classification

                  Department Location

                  Date

                  Signature of Employee

                  Street Address

                  City and State

2.       When a Flight Dispatcher properly executes such check-off form, the
         Treasurer of the Union shall forward the original signed copy to the
         Company's Manager - Payroll. A check-off form must be completed in a
         legible manner or it will be returned to the Treasurer of the Union for
         correction. Any notice of revocation as provided for in this Section or
         the Railway Labor Act, as amended, must be in writing, signed by the
         employee and two copies delivered by registered or certified mail,
         addressed to the Treasurer of the Union. Dues deductions will be
         continued

                                       32
<Page>

         until one (1) copy of such notice of revocation is received by the
         Company's Manager - Payroll, from the Treasurer of the Union. Check-off
         forms and notices received by the Company's Manager - Payroll will be
         stamp-dated on the date received and will constitute notice to the
         Company on the date received and not when mailed.

3.       When a check-off form, as specified herein, is received by the Manager
         - Payroll fifteen (15) days or more before the issuing date of the
         first bi-weekly paycheck of the month, deductions will commence with
         such paycheck and continue thereafter until revoked or canceled as
         provided in this Section. The Company will remit to the Union a check
         in payment of all dues collected as soon after the payday on which
         deductions were made, as practicable and within thirty (30) days. The
         Company remittance of Union membership dues to the office of the
         Treasurer of the Union will be accompanied by two (2) copies of a list
         for each location which includes (1) names, (2) employee register
         numbers and (3) individual amounts deducted.

4.       An employee who has executed a check-off form and who has been (1)
         transferred or promoted to a job not covered by this Agreement,
         (excluding transfers or promotions on a "Temporary" or "Acting" basis),
         (2) who has taken a leave of absence without pay, (3) who quits or
         resigns from the Company, (4) who is laid off, or is (5) otherwise
         terminated from the employ of the Company, shall be deemed to have
         automatically revoked his/her assignment as of the date of such action
         and if he/she (1) transfers back or returns to a job covered by this
         Agreement, (2) returns from leave of absence, (3) is rehired, (4) is
         recalled or (5) re-employed, further deductions of Union dues will be
         made only upon execution and receipt of another check-off form.

5.       Collection of initiation fees, as well as any back dues or service
         charges owed at the time of starting deductions for an employee,
         collection of dues or service charges missed because the employee's
         earnings were not sufficient to cover the payment of dues for a
         particular pay period, and collection of dues or service charges missed
         because of accidental errors in the accounting procedure, will be the
         responsibility of the Union and will not be the subject of payroll
         deduction. It will be the Union's responsibility to verify apparent
         errors with the individual Union member before the representative
         contacts the Company's Manager - Payroll.

6.       Deductions of membership dues shall be made from one (1) paycheck each
         month provided there is a balance in the paycheck sufficient to cover
         the amount after all other deductions authorized by the employee or
         required by law have been justified. In the event of termination of
         employment, there shall be no obligation of the Company to collect dues
         until all such other deductions (including money claims of the Company
         and the Credit Union) have been made, and such obligation to collect
         dues shall not extend beyond the pay period in which the employee's
         last day of work occurs.

                                       33
<Page>

C.  General

1.       This Section shall be in force only so long as the Union continues as
         the recognized representative of the employees under this Agreement.

2.       The Company shall not be liable for any wages or other claims
         (including discharge) of any Flight Dispatcher which may result from
         action taken by the Company pursuant to a written order by an employee
         or an authorized Union representative under the terms of this Section.

3.       As used herein, the word "Union" means Local 540, and "Treasurer of the
         Union" means Treasurer of Local 540 where applicable.

                                       34
<Page>

                                    SECTON 15

                                     GENERAL

A.       The Company shall share the expense of providing each Flight Dispatcher
         with a bound, printed copy of this Agreement with the union.

B.       All orders to and requests from a Flight Dispatcher involving
         transfers, promotions, demotions, layoff, re-employment, leaves of
         absence, or anything affecting his/her pay or status, shall be writing.

C.       The Company will meet with the Union to review new technology that the
         Company may introduce that directly relates to the Flight Dispatcher
         position.

D.       For the term of this Agreement, neither the Union nor any employees
         represented by the Union will authorize, support or engage in any
         strikes, work stoppages, slowdowns, job actions (including any sympathy
         strike or refusal to cross picket lines established by other unions)
         directed against the Company. The Company reserves the right to
         discipline, up to and including discharge, any employee who violates
         any portion of this provision. Further, the Company shall not cause,
         permit, or engage in any lockout of its Flight Dispatchers during the
         term of this Agreement.

E.       Should any part hereof or any provisions herein contained be rendered
         invalid by reason of any existing or subsequently enacted legislation
         or act of any authorized agency of government or by any decree of a
         court of competent jurisdiction, such invalidation of such part or
         portion of this Agreement shall not invalidate the remaining portions
         thereof, and they shall remain in full force and effect. Upon the
         request of either party hereto, subsequent to any such invalidation,
         the Company and the Union shall meet to discuss whether any
         modifications to this Agreement are necessary.

F.       A Flight Dispatcher shall be permitted to attend any formal
         investigation of a Chautauqua aircraft incident or accident, as such
         terms are defined by the NTSB, in which a Flight Dispatcher is believed
         to be involved.

G.       The Company shall provide space for a Union bulletin board in the
         general work area of the Flight Dispatchers. Such bulletin board must
         be lockable and shall be for the exclusive use of the Union. Materials
         posted shall be limited to official Union business and shall not
         contain any editorial material contrary to the interests of the
         Company.

H.       Flight Dispatchers will be afforded travel benefits similar to those
         extended to other employee groups as established by company policy as
         may be amended by

                                       35
<Page>

         the Company from time-to-time. Whenever the Company intends to modify
         its online employee travel policy it shall provide the Union thirty
         (30) days notice of the change. The Union will have an opportunity to
         comment on the change and such comments will be considered by the
         Company. The Company shall make available to Flight Dispatchers, each
         year, a list of carriers with which it has jumpseat agreements.

I.       Flight Dispatchers who at the time of retirement are covered by this
         Agreement shall receive retiree travel privileges in accordance with
         the Company's Employee Handbook.

J.       Flight Dispatchers who are furloughed/severed under the terms of this
         Agreement, as the result of a reduction in force will be granted, upon
         request, one (1) free round trip space available pass on Company
         aircraft for the purpose of seeking employment. Such pass may be to any
         point on the Company's system within the continental limits of the
         United States, to the extent permitted by law.

K.       In accordance with applicable law, there shall be no discrimination
         against Flight Dispatchers covered by this Agreement because of race,
         color, creed, national origin, religion, sex, age, handicap or
         disability, or veteran status (including Vietnam era veteran and
         special disabled veteran status).

L.       The Section Chairman or alternate designee performing official Union
         business shall be granted time off from work to a maximum aggregate of
         96 unpaid hours per calendar year. All time granted will be contingent
         upon there being adequate schedule coverage.

M.       The Company will continue providing for direct deposit (electronic
         transfer) of paychecks.

N.       Flight Dispatchers covered under this Agreement shall be given time off
         for jury duty as per applicable state law. Time off will be without pay
         unless the applicable state law changes.

O.       Flight Dispatchers shall be authorized to occupy cockpit jumpseats on
         Company aircraft in accordance with the provisions of the Company's
         General Operations Manual. Chautauqua Flight Dispatchers will have
         higher priority than pilots and dispatchers employed by other carriers.

P.       The Company will continue to provide the Flight Dispatchers with free
         parking at their work location.

Q.       Upon written request to the Dispatch Manager, a Flight Dispatcher's
         complete personnel file will be made available to him/her during
         regular business hours.

                                       36
<Page>

R.       The Company will not use discipline letters more than three (3) years
         old during the grievance process involving a Flight Dispatcher.

S.       The Company will allow an opportunity for input from the Union
         regarding functionality and ergonomics before introducing new equipment
         or new furniture into the Dispatch Office, or before the Company
         relocates the Dispatch Office.

T.       No Flight Dispatcher covered under this Agreement shall be required to
         perform the duties of employees who are conducting a legal strike or
         other job action against the Company.

                                       37
<Page>

                                   SECTION 16

                                    DURATION

This Agreement shall become effective upon signing and shall continue in full
force and effect through February 19, 2007 and shall renew itself for yearly
periods thereafter unless written notice of intended change is served in
accordance with Section 6, Title I, of the Railway Labor Act, as amended, by
either party hereto not sooner than one-hundred twenty (120) days but not less
than sixty (60) days prior to February 19, 2007 or a subsequent anniversary of
such date, unless the parties mutually agree otherwise.

IN WITNESS WHEREOF, the parties hereto have signed this Agreement this 18th day
of February 2001.

For    CHAUTAUQUA, AIRLINES INC.         For    THE TRANSPORT WORKERS
                                         UNION OF AMERICA, AFL-CIO

By: /s/ Wayne Heller                     By: /s/ David Durkin
   ---------------------------------        ---------------------------------
   Wayne Heller                             David Durkin
   Vice President,                          TWU Local 540,
         Flight Operations                        President

                                       38
<Page>

                               LETTER OF AGREEMENT
                                     between
                            CHAUTAUQUA AIRLINES, INC.
                                       and
                             THE FLIGHT DISPATCHERS
                                in the service of
                            CHAUTAUQUA AIRLINES, INC.
                                as represented by
                             TRANSPORT WORKERS UNION
                               OF AMERICA, AFL-CIO

                                    OVERTIME

The letter shall serve as a temporary agreement between the parties above to
provide interim relief while new dispatchers are being trained.

     1.  During the month of September 2000, Flight Dispatcher and Dispatch
         Coordinator shifts worked on overtime shall be paid at the rate of time
         and one half, with an additional stipend of $60.00 per day.

     2.  If, in the event that a staffing situation continues to exist at the
         end of September 2000, the Union and the Company shall meet to discuss
         an extension.

AGREED AND ACCEPTED:

/s/ David Durkin                             /s/ Wayne Heller
----------------------------------           ---------------------------------

By:  David Durkin                            Wayne Heller
President                                    Vice President, Flight Operations
Transport Workers Union, Local 540           Chautauqua Airlines, Inc.

                                       39
<Page>

                               LETTER OF AGREEMENT
                                     between
                            CHAUTAUQUA AIRLINES, INC.
                                       and
                             THE FLIGHT DISPATCHERS
                                in the service of
                            CHAUTAUQUA AIRLINES, INC.
                                as represented by
                             TRANSPORT WORKERS UNION
                               OF AMERICA, AFL-CIO

                               COMPENSATION SCALE

The letter shall serve as an agreement between the parties mentioned above as to
the minimum base rates of pay for the Flight Dispatchers of Chautauqua Airlines,
Inc. that will go into effect on February 19, 2006.

<Table>
<Caption>
                                 Longevity      Effective
                                                 2/19/06
                             -------------------------------
<S>                                               <C>
                                 Hire date        12.93
                                 6 Months         13.29
                                  1 Year          13.53
                               1 1/2 Years        13.82
                                  2 Years         14.20
                                  3 Years         14.75
                                  4 Years         15.27
                                  5 Years         15.83
                                  6 Years         16.44
                                  7 Years         17.20
                                  8 Years         17.54
                                  9 Years         17.90
                                 10 Years         18.25
                                 11 Years         18.73
</Table>

AGREED AND ACCEPTED:

/s/ David Durkin                           /s/ Wayne Heller
-----------------------------------        -----------------------------------

By:  David Durkin                          Wayne Heller
President                                  Vice President, Flight Operations
Transport Workers Union, Local 540         Chautauqua Airlines, Inc.

                                       40
<Page>

                               LETTER OF AGREEMENT
                                     between
                            CHAUTAUQUA AIRLINES, INC.
                                       and
                             THE FLIGHT DISPATCHERS
                                in the service of
                            CHAUTAUQUA AIRLINES, INC.
                                as represented by
                             TRANSPORT WORKERS UNION
                               OF AMERICA, AFL-CIO

                              FILLING OF VACANCIES

This Letter shall serve as an agreement between the parties mentioned for the
policies to be followed in the event that Flight Dispatcher vacancies need to be
filled.

A.   Filling of Vacant Work Schedules

     1.  A Permanent Vacancy on a fixed or rotating Work Schedule shall be
         filled by awarding the bid of the most senior Flight Dispatcher who had
         bid to move to the open Work Schedule. Any fixed or rotating Work
         Schedule opened by the award of such bid shall be filled by the most
         senior Relief Dispatcher who desires to move to the open fixed or
         rotating Work Schedule. Should there be no bids and should no Relief
         Dispatcher wish to move to the open fixed or rotating Work Schedule,
         the Company may assign the most junior qualified Relief Dispatcher to
         the open Work Schedule.

     2.  A vacancy that is expected to last less than sixty (60) days shall be
         considered a temporary vacancy and will be filled using Relief
         Dispatchers.

     3.  The selection of Flight Dispatchers to fill Special Assignment Work
         Schedules shall be the sole decision of the Company from among those
         Flight Dispatchers who have indicated their desire for the Special
         Assignment. Should no Flight Dispatcher express an interest for a
         particular Special Assignment and the Company deems it necessary to
         fill the Special Assignment, the most junior qualified Flight
         Dispatcher may be assigned.

AGREED AND ACCEPTED:

/s/ David Durkin                            /s/ Wayne Heller
----------------------------------          -----------------------------------

By:  David Durkin                           By:  Wayne Heller
President                                   Vice President, Flight Operations
Transport Workers Union, Local 540          Chautauqua Airlines, Inc.

                                       41

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