10-Q/A

                                                    FORM 10-Q/A

                                         SECURITIES AND EXCHANGE COMMISSION
                                               Washington, D.C.  20549

                                                 AMENDMENT NO. 1 TO

[X]      QUARTERLY  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
         For the quarterly period ended June 30, 2002


[   ]    TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934


Commission file number:  0-24126



                                               FRONTIER AIRLINES, INC.
                                (Exact name of registrant as specified in its charter)



                        Colorado                                               84-1256945
(State or other jurisdiction of incorporated or organization)     (I.R.S. Employer Identification No.)


                  7001 Tower Road, Denver, CO                                    80249
         (Address of principal executive offices)                             (Zip Code)


Issuer's telephone number including area code:  (720) 374-4200


Indicate by check mark  whether the  registrant  (1) has filed all reports  required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the  registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days.  Yes X     No    


The number of shares of the Company's Common Stock outstanding as of February 12, 2003 was 29,657,550.






                                               EXPLANATORY NOTE

The Company is amending Item 6, Part II of its Form 10-Q for the quarterly period ended June 30, 2002,
to replace Exhibits 10.69, 10.71, and 10.73 with the attached Exhibits 10.69, 10.71, and 10.73 to clearly
reflect where material was omitted in these exhibits under the Company's Confidential Treatment Request
filed with the Securities and Exchange Commission. The changes in these exhibits were made in response to
comments the Company received from the Securities and Exchange Commission to the Company's Confidential
Treatment Request.

                                          PART II. OTHER INFORMATION

Item 6:        Exhibits and Reports on Form 8-K

(a)      Exhibits

              Exhibit
              Numbers

              10.68    Aircraft Lease  Agreement  dated as of May 1, 2002 between AFS  Investments  XVILLC
                       as Lessor and Frontier  Airlines, Inc. as Lessee. (1)

              10.69    * Credit Agreement  [Frontier/2002-A]  dated as of June 26, 2002 between Frontier
                       Airlines,  Inc.,  Borrower,  and Landesbank Schleswig-Holstein Girozentrale, as
                       Administrative Agent on behalf of the lenders.  (2)

              10.70    Mortgage and Security Agreement  [Frontier/2002-A]  dated as of June 26, 2002 between
                       Frontier Airlines, Inc., Borrower, and Landesbank Schleswig-Holstein Girozentrale, as
                       Administrative Agent on behalf of the lenders. (1)

              10.71    * Credit Agreement  [Frontier/2002-B] dates as of July 16, 2002 between Frontier Airlines,
                       Inc., Borrower, and Erste Bank Der Oesterreichschen Sparkassen AG, as Administrative Agent
                       on behalf of the lenders.  (2)

              10.72    Mortgage and Security Agreement  [Frontier/2002-B]  dated as of July 16, 2002 between
                       Frontier Airlines, Inc., Borrower, and Erste Bank Der Oesterreichschen Sparkassen AG, as
                       Administrative Agent on behalf of the lenders. (1)

              10.73    * Credit  Agreement  {Frontier/HLB]  dated as of May 23, 2002 between  Frontier  Airlines,
                       Inc., Borrower, and Hamburgische Landesbank-Girozentrale, as Administrative Agent on behalf
                       of the lenders. (2)

              10.74    Mortgage and Security  Agreement  [Frontier/HLB]  dated as of May 23, 2002  between  Frontier
                       Airlines, In., Borrower, and Hamburgische Landsebank-Girozentrale, as Administrative Agent on
                       behalf of the lenders. (1)

              (1)      Filed previously with the Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
                       2002.
              (2)      Filed herewith.
              (*)      Portions of this Exhibit have been omitted and filed separately with the Securities and Exchange
                       Commission in a confidential treatment request under Rule 24b-2 of the Securities Exchange Act of
                       1934, as amended.

(b)      Reports on Form 8-K

              None.






                                                          SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


                                                     FRONTIER AIRLINES, INC.


Date:  March 4, 2003                                 By: /s/ Paul H. Tate
                                                     Paul H. Tate, Vice President and
                                                     Chief Financial Officer


Date:  March 4, 2003                                 By: /s/ Elissa A. Potucek
                                                     Elissa A. Potucek, Vice President, Controller,
                                                     Treasurer and Principal Accounting Officer





                                               Certification

I, Jeff Potter, certify that:

1.       I have reviewed this Amendment No. 1 on Form 10-Q/A to the quarterly report on Form 10-Q of Frontier
         Airlines,  Inc.; and

2.       Based on my knowledge,  this  Amendment  does not contain any untrue  statement of a material fact or
         omit to state a material fact necessary to make the statements made, in light of the circumstances under
         which such statements were made, not misleading with respect to the period covered by this Amendment.

Date:   March 4, 2003


                                                       By:      /s/ Jeff  S. Potter          
                                                              Jeff S. Potter
                                                              President and Chief Executive Officer

I, Paul Tate, certify that:

1.       I have reviewed this Amendment No. 1 on Form 10-Q/A to the quarterly report on Form 10-Q of Frontier
         Airlines, Inc.; and

2.       Based on my knowledge,  this  Amendment  does not contain any untrue  statement of a material fact or
         omit to state a material fact necessary to make the statements made, in light of the circumstances under
         which such statements were made, not misleading with respect to the period covered by this Amendment.

Date:    March 4, 2003


                                                       By:       /s/ Paul H. Tate             
                                                              Paul H. Tate
                                                              Chief Financial Officer

EX-10

                                                                EXECUTION COPY

PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION IN A CONFIDENTAL TREATMENT REQUEST UNDER
RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.



                                    CREDIT AGREEMENT
                                     [Frontier/HLB]


                                      Dated as of

                                      May 23, 2002


                                         AMONG



                                FRONTIER AIRLINES, INC.,
                                       Borrower,


                               THE LENDERS LISTED HEREIN,


                                          and


                        HAMBURGISCHE LANDESBANK -GIROZENTRALE-,
                    as Administrative Agent on behalf of the Lenders







                                                 TABLE OF CONTENTS
                                                                                                               Page


Section 1.        Certain Definitions and Interpretive Matters...................................................1

Section 2.        Loans; Borrower's Notice of Delivery Dates; Closing Procedure;
                  Alternative Structure..........................................................................2

Section 3.        Fees...........................................................................................3

Section 4.        Conditions.....................................................................................3

Section 5.        Closing Procedure..............................................................................7

Section 6.        Extent of Interest of Lenders..................................................................8

Section 7.        Representations and Warranties.................................................................8

Section 8.        Indemnities...................................................................................12

Section 9.        Covenants of the Borrower.....................................................................19

Section 10.       The Notes.....................................................................................23

Section 11.       Events Of Default; Certain Rights of Administrative Agent.....................................28

Section 12.       Remedies......................................................................................31

Section 13.       Replacement Engines...........................................................................35

Section 14.       The Administrative Agent......................................................................37

Section 15.       Investment Of Funds...........................................................................39

Section 16.       Supplements and Amendments to the Mortgage and Other Operative
                  Documents.....................................................................................40

Section 17.       Notices.......................................................................................41

Section 18.       Governing Law; Consent to Jurisdiction; Waiver of Jury Trial..................................41

Section 19.       Costs and Expenses............................................................................42

Section 20.       Section 1110 Compliance.......................................................................42

Section 21.       Confidentiality...............................................................................43

Section 22.       Covenants of the Administrative Agent and the Lenders.........................................43

Section 23.       Leveraged Lease Financing.....................................................................44

Section 24.       Miscellaneous.................................................................................45

Section 25.       Terms of FIXED RATE SETTING...................................................................47

Schedules:
I.                                           Notice and Account Information
II.                                          Participation in Original Amount
Exhibit A -                                  Form of Borrowing Notice
Exhibit B -                                  Form of Assignment Agreement





                                                                [Credit Agreement [Frontier/HLB]]



 CREDIT AGREEMENT [Frontier/HLB]

         THIS CREDIT AGREEMENT [Frontier/HLB] dated as of May 23, 2002 among
(i) Frontier Airlines, Inc., a Colorado corporation (the "Borrower"), (ii) the lenders
that are party hereto identified under the caption "Lenders" on the signature pages
hereto or that, pursuant to Section 24(c) hereof, shall become a "Lender" hereunder
(individually, a "Lender" and, collectively, the "Lenders") and (iii) Hamburgische
Landesbank -Girozentrale-, a Landesbank organized under the laws of Germany, as
Administrative Agent on behalf of the Lenders (the "Administrative Agent").

                                  W I T N E S S E T H:

         WHEREAS, certain terms are used herein as defined in Section 1(a) hereof; and

         WHEREAS, concurrently with the execution and delivery of this Agreement, the
Borrower and the Administrative Agent are entering into the Mortgage and Security
Agreement [Frontier/HLB] dated as of the date hereof (the "Mortgage") pursuant to
which the Borrower agrees, among other things, to issue one or more Notes in respect
of each Aircraft as evidence of the Borrower's indebtedness to the Lenders, which
Notes will be secured by the mortgage and security interest created by the Borrower in
favor of the Administrative Agent on behalf of the Lenders, and the Borrower shall
execute and deliver a Mortgage Supplement covering each Aircraft, supplementing the
Mortgage.

         NOW THEREFORE, in consideration of the mutual agreements herein contained, the
parties hereto agree as follows:

Section 1.        Certain Definitions and Interpretive Matters.

         Except as otherwise defined in this Agreement, including its annexes,
schedules and exhibits, terms used herein in capitalized form shall have the meanings
attributed thereto in the Mortgage.  The rules of interpretation contained in Section
1.02 of the Mortgage shall be applicable to this Agreement.  In addition the following
terms shall have the following meanings:

         "Aircraft 1743" means, collectively, the Airbus A319-111 airframe bearing
manufacturer's serial number 1743, together with two (2) CFM International Model CFM
56-5B5/P Engines bearing manufacturer's serial numbers 575406 and 575407.

         "Aircraft TBD" means, collectively, the Airbus A319-111 airframe scheduled to
be delivered to the Borrower under its Purchase Agreement in December 2002, together
with two (2) CFM International Model CFM 56-5B5/P Engines initially installed thereon,
in each case bearing the manufacturer's serial numbers set forth in the Mortgage
Supplement with respect thereto.

         Unless the context otherwise requires, any reference herein to any of the
Operative Documents refers to such document as it may be modified, amended or
supplemented from time to time in accordance with its terms and the terms of each
other agreement restricting the modification, amendment or supplement thereof.

Section 2.        Loans; Borrower's Notice of Delivery Dates; Closing Procedure; Alternative Structure.

(a)      Loans.  Subject to the terms and conditions of this Agreement, each Lender
agrees to make a secured loan to the Borrower in respect of each Aircraft (herein called,
for such Aircraft, a "Loan") on a date to be designated pursuant to Section 2 hereof, on
or about (x) in the case of Aircraft 1743, May 23, 2002 but in no event later than June 30,
2002 (the "Initial Commitment Termination Date") and (y) in the case of Aircraft TBD, in
December, 2002, but in no event later than January 31, 2003 (the "Second Commitment
Termination Date"), in the amount in Dollars for each Aircraft and Leverage Option set
forth opposite such Lender's name in Schedule II hereto (its "Commitment" for such
Aircraft), and to receive, as evidence of each such secured loan, Note(s) of the
applicable Series in an amount equal to its Commitment for such Aircraft; provided
that the aggregate amount of Loans for all Aircraft to be made by each Lender shall
not exceed the amount in Dollars set forth opposite such Lender's name in Schedule II
hereto as its Maximum Commitment (its "Maximum Commitment").  The aggregate amount of
the Commitments for each Aircraft shall equal the Original Amount for such Aircraft.
Each Loan shall bear interest and amortize in accordance with Section 2.02 of the
Mortgage.

(b)      Notice of Delivery Dates.  The Borrower agrees to give the Lenders and
the Administrative Agent at least three (3) Business Days' prior written notice of the
Delivery Date for each Aircraft, which Delivery Date shall be a Business Day not later
than (i) in the case of Aircraft 1743, the Initial Commitment Termination Date and (ii)
in the case of Aircraft TBD, the Second Commitment Termination Date, by executing and
delivering a borrowing notice substantially in the form of Exhibit A hereto (the "Borrowing
Notice"), which notice shall also specify (if not previously selected as provided in
paragraph (e) below) the Leverage Option elected and any funding instructions.  The
payment by each Lender of its Commitment in respect of any Aircraft in the manner
required by this Section 2 shall constitute a waiver of such notice.

(c)      Closing Procedure.  Subject to the terms and conditions of this Agreement,
and simultaneous with receipt by the Seller of the Original Amount for any Aircraft pursuant
to this Section 2, the Borrower shall authorize the delivery and filing for record at the
FAA of the Mortgage and/or the Mortgage Supplement for such Aircraft.  On the Delivery Date
for each Aircraft specified in the Borrower's notice referred to in the first paragraph of
this Section 2, subject to the terms and conditions of this Agreement, each Lender agrees
to pay the amount of its Commitment for such Aircraft to the Seller by wire
transferring such amounts to the Seller's account at Credit Lyonnais, 1301 Avenue of
the Americas, New York, NY 10019, ABA No. [***] Account # [***], Attention  William McIlwain,
Reference Frontier MSN 1743 or TBD, as the case may be, or to such other account as
the Borrower shall direct the Administrative Agent (on behalf of the Lenders) in
writing, upon closing.

[***] Represents material that has been omitted and filed separately with the Securities
and Exchange Commission under a Confidental Treatment Request.

(d)      Alternative Structure.  Notwithstanding anything to the contrary in this
Agreement or any other Operative Document, the Borrower, subject to the provisions of this
Section 2(d) and Section 23 hereof, may elect to finance Aircraft 1743 and/or Aircraft TBD
on the basis of a U.S. leveraged lease financing, whereupon the Lenders' Commitments shall
be utilized for such purpose, and the Lenders' obligations to finance the applicable
aircraft on a mortgage basis, and the Borrower's obligations to use the Lenders'
Commitments to finance the applicable aircraft on a mortgage basis, shall be deemed
discharged by such utilization.

(e)      Leverage Option.  The Borrower may notify the Administrative Agent at any
time after the date hereof of the Leverage Option for any Aircraft, which notice shall be
irrevocable.

Section 3.        Fees.

(a)      The Borrower agrees to pay to the Administrative Agent (on behalf of the Lenders),
on or before each Delivery Date, an up-front fee of the percentage (the "Up-front Fee")
of the Original Amount of each Loan to be funded on such Delivery Date as separately agreed,
to the account of the Administrative Agent specified in Schedule I hereto (or such other
account as the Administrative Agent may direct in writing).

(b)      The Borrower agrees to pay to the Administrative Agent (on behalf of the Lenders),
after the date hereof, a commitment fee of [***]% (the "Commitment Fee") on the unutilized
Commitments (for which purpose the figures for Option B shall govern unless the Borrower,
pursuant to Section 2(e) hereof, has notified the Administrative Agent that it has elected
Option A with respect to any Aircraft, in which case the Commitments for such Aircraft
shall be determined in accordance with Option A effective from the date of receipt by
the Administrative Agent of notice of such election), to the account of the
Administrative Agent specified in Schedule I hereto (or such other account as the
Administrative Agent may direct in writing).  The Commitment Fee shall accrue from and
including April 30, 2002 to but excluding the earlier of (x) the Delivery Date for the
last Aircraft financed hereunder and (y) the Second Commitment Termination Date.  The
Commitment Fee shall be payable on August 23, 2002, November 23, 2002 and on the
earlier dates contemplated by clauses (x) and (y) of the preceding sentence.  The
Commitment Fee shall be calculated on the basis of a year of 360 days and actual
number of days elapsed.  Promptly following receipt by the Administration Agent of the
Commitment Fee in respect of any period, the Administrative Agent shall distribute the
same to each Lender, pro rata based on such Lender's unutilized Commitments.

[***] Represents material that has been omitted and filed separately with the Securities
and Exchange Commission under a Confidental Treatment Request.

Section 4.        Conditions.

(a)      Conditions Precedent to the Effectiveness of the Commitment. It is agreed
that the Commitment of the Lenders is subject to the satisfaction prior to or on the first
Delivery Date of the following conditions precedent:

(i)      The following documents shall have been duly authorized, executed and delivered
         by the respective party or parties thereto, shall each be satisfactory in form and
         substance to the Administrative Agent and shall be in full force and effect and
         executed counterparts shall have been delivered to the Lenders and the Administrative
         Agent or their respective counsel:

(A)      the Mortgage; and

(B)      a copy of that portion of the Purchase Agreement and Engine Agreement certified by
                  the Secretary or an Assistant Secretary of the Borrower as being a true
                  and accurate copy of the same that relates to the Assigned Warranties
                  and the related obligations of the Borrower or a successor in interest
                  to the Borrower which has the right to exercise any such warranty.

(ii)     Each Lender and the Administrative Agent shall have received the following, in each
         case in form and substance satisfactory to each of them:

(A)      a certified copy of the Articles of Incorporation and Bylaws of the Borrower and
                  a copy of resolutions of the board of directors of the Borrower or the
                  executive committee thereof, certified by the Secretary or an Assistant
                  Secretary of the Borrower, duly authorizing the execution, delivery and
                  performance by the Borrower of this Agreement, the Mortgage and each other
                  document required to be executed and delivered by the Borrower on each
                  Delivery Date in accordance with the provisions hereof and thereof;
                  and

(B)      a certificate of the Borrower as to the Person or Persons authorized to execute and
                  deliver this Agreement, the other Operative Documents, and any other documents
                  to be executed on behalf of the Borrower in connection with the
                  transactions contemplated hereby and as to the signature of such
                  person or persons.

(iii)    Each Lender and the Administrative Agent shall have received an opinion addressed to
         such Lender and the Administrative Agent from each of: (A) David Sislowski, Esq.,
         General Counsel for the Borrower and (B) Curtis Mallet-Prevost, Colt & Mosle LLP,
         special counsel to the Borrower, each in form and substance reasonably satisfactory
         to the addressees thereof.

(b)      Conditions Precedent to each Lender's Commitment to Lend on each Delivery Date.
It is agreed that the respective obligations of each Lender to lend its Commitment to the
Borrower in respect of each Aircraft is subject to the satisfaction prior to or on the
Delivery Date for each Aircraft of the following conditions precedent:

(i)      Each Lender and the Administrative Agent shall have received from the Borrower a
         duly executed Borrowing Notice with respect to such Delivery Date pursuant to
         Section 2 hereof.

(ii)     No change shall have occurred after the date of the execution and delivery of this
         Agreement in applicable law or regulations thereunder or interpretations thereof by
         appropriate regulatory authorities which, in the reasonable opinion of each
         Lender would make it a violation of law or regulations for such Lender to make
         its Commitment for such Aircraft available to fund the applicable Loan or to
         realize the benefits of the security afforded by the Mortgage in respect
         thereof.

(iii)    on such Delivery Date, such Aircraft will have been duly certified by the FAA as
         to type and airworthiness, will have been insured by the Borrower in accordance
         with the terms of the Mortgage, will have suffered no Event of Loss (or event which,
         with the passage of time would constitute an Event of Loss) and will be in the
         condition and state of repair required under the terms of the Mortgage.

(iv)     The following documents shall have been duly authorized, executed and delivered by
         the respective party or parties thereto, shall each be satisfactory in form and
         substance to the Lenders and the Administrative Agent and shall be in full force
         and effect and executed counterparts shall have been delivered to the Lenders and the
         Administrative Agent or their respective counsel, provided that only each
         Lender shall receive an executed original of its respective Note(s):

(A)      the Mortgage Supplement covering such Aircraft and dated such Delivery Date;
                  Schedule I to such Mortgage Supplement shall be completed as provided in
                  Section 2.02(c) of the Mortgage;

(B)      the Note(s) of the Series for such Aircraft in an aggregate principal amount equal
                  to the Original Amount reflecting the Leverage Option selected by the
                  Borrower;

(C)      the Consent and Agreement and the Engine Consent and Agreement, in each case,  in
                  respect of such Aircraft, each of which shall be in form and substance
                  reasonably satisfactory to the Administrative Agent; and

(D)      the Warranty Bill of Sale and FAA Bill of Sale for such Aircraft.

(v)      The Borrower shall have authorized the filing by the Administrative Agent of
         Uniform Commercial Code financing statement or statements covering all the
         security interests created by or pursuant to the granting clause of the Mortgage
         that are not covered by the recording system established by the Federal Aviation
         Act, and such financing statement or statements shall have been duly filed in all
         places deemed necessary or advisable in the opinion of counsel for the Lenders,
         and any additional Uniform Commercial Code financing statements deemed advisable
         by the Lenders shall have been duly filed and all other action shall have been
         taken as is deemed necessary or advisable, in the opinion of counsel for the
         Lenders, to establish and perfect the Administrative Agent's security interest
         in such Aircraft.

(vi)     All appropriate action required to have been taken by the Federal Aviation
         Administration, or any governmental or political agency, subdivision or
         instrumentality of the United States, on or prior to such Delivery Date in
         connection with the transaction contemplated by this Agreement shall have been
         taken, and all orders, permits, waivers, authorizations, exemptions and approvals
         of such entities required to be in effect on such Delivery Date in connection with
         the transaction contemplated by this Agreement shall have been issued, and all
         such orders, permits, waivers, authorizations, exemptions and approvals shall be
         in full force and effect on such Delivery Date.

(vii)    On such Delivery Date the following statements shall be true, and the Lenders shall
         have received evidence satisfactory to it to the effect that:

(A)      the Borrower has good title to such Aircraft, free and clear of Liens other than
                  (subject to filing and recording of the FAA Bill of Sale with the Federal
                  Aviation Administration if the Borrower does not already own such Aircraft)
                  the mortgage and security interests created by the Mortgage and the
                  Mortgage Supplement for such Aircraft;

(B)      the Mortgage, the FAA Bill of Sale and the Mortgage Supplement for such Aircraft
                  have been duly filed with the FAA for recordation (or are in the process
                  of being so filed for recordation) and there exist no Liens of record on
                  such Aircraft prior to the Lien of the Mortgage;

(C)      such Aircraft has been duly certified as to type and airworthiness by the FAA, and
                  the Borrower has authority to operate such Aircraft (and the Lenders shall
                  have received a copy of the airworthiness certificate for such Aircraft);
                  and

(D)      the Administrative Agent is entitled to the protection of Section 1110 of the United
                  States Bankruptcy Code in connection with its right to take possession of
                  such Aircraft in the event of a case under Chapter 11 of the United States
                  Bankruptcy Code in which the Borrower is a debtor.

(viii)   On such Delivery Date, the representations and warranties of the Borrower contained
         in Section 7(a) of this Agreement shall be true and accurate as though made on and
         as of each such date except to the extent that such representations and warranties
         relate solely to an earlier date (in which case such representations and warranties
         shall be true and accurate on and as of such earlier date), including the
         representation and warranty that there had not occurred any event which
         constitutes a Default or an Event of Default which is presently continuing.

(ix)     Each Lender and the Administrative Agent shall have received an opinion addressed
         to such Lender and the Administrative Agent from each of:  (A) David Sislowski,
         Esq., General Counsel for the Borrower and (B) Curtis Mallet-Prevost, Colt & Mosle
         LLP, special counsel to the Borrower, each in form and substance reasonably
         satisfactory to the addressees thereof.

(x)      Each Lender and the Administrative Agent shall have received an opinion addressed
         to such Lender and the Administrative Agent and the Borrower from Daugherty, Fowler,
         Peregrin & Haught, FAA counsel in Oklahoma City, Oklahoma, in form and substance
         reasonably satisfactory to the addressees thereof.

(xi)     The Administrative Agent shall have received an opinion addressed to the
         Administrative Agent from in-house counsel to AVSA, in respect of the Bills of Sale
         for the Aircraft delivered on such Delivery Date, in form and substance reasonably
         satisfactory to the addressees thereof.

(xii)    Each Lender and the Administrative Agent shall have received a certificate signed
         by the President, a Vice President, the Chief Financial Officer or the Treasurer
         of the Borrower, dated the Delivery Date, addressed to each Lender and the
         Administrative Agent and certifying as to the matters stated in paragraphs (viii)
         and (xiv) of this Section 4(b).

(xiii)   Each Lender and the Administrative Agent shall have received an independent insurance
         brokers' report and certificate(s) of insurance, in form and substance reasonably
         satisfactory to each Lender and the Administrative Agent as to the due compliance
         with the terms of Article VI of the Mortgage relating to insurance with respect to
         such Aircraft.

(xiv)    On such Delivery Date it shall be true that no Event of Loss (or event which with
         the passage of time would become an Event of Loss) with respect to such Aircraft
         (or constituent Airframe) or any Engine has occurred.

(xv)     No action or proceeding shall have been instituted nor shall governmental action
         be threatened before any court or governmental agency, nor shall any order, judgment
         or decree have been issued or proposed to be issued by any court or governmental
         agency at the time of such Delivery Date to set aside, restrain, enjoin or prevent
         the completion and consummation of this Agreement or the transaction contemplated
         hereby.

(xvi)    The Administrative Agent shall have received the Up-front Fee pursuant to Section
         3(a) and, if applicable, any Commitment Fee pursuant to Section 3(b) that is due
         and payable.

(xvii)   The Lenders shall have received from the Borrower the statement of financial
         position and statement of earnings and cash flow for the Borrower for the fiscal
         quarter most recently ended at least 60 days prior to such Delivery Date, and since
         the date of such statement of financial position and statement of earnings and cash
         flow, there shall have occurred no materially adverse change in the financial
         condition or operations of the Borrower which would affect the Borrower's ability
         to perform its obligations hereunder or under any of the Operative Documents.

Promptly upon the recording of the Mortgage and any Mortgage Supplement covering an
Aircraft pursuant to the Federal Aviation Act, the Borrower will cause Daugherty,
Fowler, Peregrin & Haught, FAA counsel in Oklahoma City, Oklahoma, to deliver to the
Lenders, the Administrative Agent and the Borrower an opinion as to the due and valid
registration of such Aircraft in the name of the Borrower, the due recording of the
Mortgage and the Mortgage Supplement and the lack of filing of any intervening
documents with respect to such Aircraft.  Promptly following each Delivery Date, the
Borrower shall cause a huissier to serve a copy of a notice delivered on such Delivery
Date on the Manufacturer and the Seller in accordance with Article 1690 of the French
Civil Code.

Section 5.        Closing Procedure.

         Following the Borrower's notice of the Delivery Date for any Aircraft as
provided in Section 2 hereof, the parties will pre-position the executed Mortgage
and/or Mortgage Supplement with FAA counsel in Oklahoma City, Oklahoma, together with
the FAA Bill of Sale for such Aircraft and the application for registration of such
Aircraft in the name of the Borrower.  On such Delivery Date and in sufficient time to
permit the closing to occur during business hours of the FAA in Oklahoma City,
Oklahoma, each Lender will wire transfer its Commitment for such Aircraft to the
Seller.  On each Delivery Date, by conference telephone call among the Seller, the
Borrower, the Lenders (and/or their counsel acting on their behalf), the
Administrative Agent and FAA counsel, the Seller will authorize the filing of the FAA
Bill of Sale for the Aircraft to be delivered on such Delivery Date and the Borrower
will authorize the filing of the Mortgage and/or the Mortgage Supplement for such
Aircraft upon receipt by the Seller of the Original Amount of the Loan for such
Aircraft.  The irrevocable authorization to FAA counsel to date the FAA Bill of Sale
and the Mortgage Supplement for such Aircraft and file the FAA Bill of Sale and the
Mortgage and/or Mortgage Supplement for such Aircraft will occur prior to the transfer
of the Original Amount of the Loan for such Aircraft to the Seller, but the filing
will not occur until the Seller's receipt of the purchase price for such Aircraft.
The Note(s) will be delivered to the Lenders, as applicable, and legal opinions
delivered to all parties immediately following the filing of the FAA Bill of Sale and
the Mortgage and/or Mortgage Supplement for such Aircraft at the FAA.

Section 6.        Extent of Interest of Lenders.

         No Lender shall have any further interest in, or other right with respect to,
the mortgage and security interests created by the Mortgage when and if the Original
Amount of and interest on all Note(s) held by such Lender and all other sums payable
to such Lender hereunder, under the Mortgage and under such Note(s) shall have been
paid in full.

Section 7.        Representations and Warranties.

(a)      Borrower's Representations and Warranties.  The Borrower represents and warrants
that on the date hereof and on each Delivery Date:

(i)      the Borrower is a corporation duly organized and validly existing in good standing
         pursuant to the laws of the State of Colorado; is duly qualified to do business as
         a foreign corporation in each jurisdiction in which its operations or the nature of
         its business requires, except where the failure to be so qualified would not have
         a material adverse effect on the Borrower or its business; is a U.S. Air
         Carrier; maintains its location (as such term is defined in Article 9 of the
         Uniform Commercial Code) in Colorado; and has the corporate power and
         authority to engage in air transport and to carry on scheduled passenger
         service as presently conducted, to own the Aircraft and to enter into and
         perform its obligations under the Operative Documents;

(ii)     the execution, delivery and performance by the Borrower of the Operative Documents
         will, on such Delivery Date, have been duly authorized by all necessary corporate
         action on the part of the Borrower, do not require any stockholder approval, or
         approval or consent of any trustee or holders of any indebtedness or obligations
         of the Borrower except such as have been duly obtained or by such Delivery Date
         will have been duly obtained and will on such Delivery Date be in full force and
         effect, and none of such Operative Documents contravenes any law, judgment,
         government rule, regulation or order binding on the Borrower or the articles
         of incorporation or bylaws of the Borrower or contravenes the provisions of,
         or constitutes a default under, or results in the creation of any Lien (other
         than Permitted Liens) upon the property of the Borrower under, any indenture,
         mortgage, contract or other agreement to which the Borrower is a party or by
         which it or its properties may be bound or affected;

(iii)    neither the execution and delivery by the Borrower of the Operative Documents nor
         the performance by the Borrower of its obligations thereunder requires the consent
         or approval of, the giving of notice to, or the registration with, or the taking
         of any other action in respect of any Federal, state or foreign government
         authority or agency, except for (A) the orders, permits, waivers, exemptions,
         authorizations and approvals of the regulatory authorities having jurisdiction
         over the operation of the Aircraft by the Borrower, which orders, permits,
         waivers, exemptions, authorizations and approvals have been duly obtained or
         will on or prior to such Delivery Date be duly obtained, and will on such
         Delivery Date be in full force and effect, (B) any normal periodic and other
         reporting requirements under the Federal Aviation Act and the regulations
         promulgated thereunder and the applicable rules, and regulations of the FAA,
         in each case to the extent required to be given or obtained only after such
         Delivery Date, (C) any filings, registrations or applications specifically
         described in this Agreement, and (D) an air operator's certificate with
         respect to Airbus Model A319 aircraft, which certificate has been obtained by
         the Borrower;

(iv)     the Operative Documents to which the Borrower is a party delivered on or prior to
         the date hereof or such Delivery Date, as the case may be, each constitute legal,
         valid and binding obligations of the Borrower enforceable against the Borrower in
         accordance with the terms thereof except as such may be limited by equitable
         principles or applicable bankruptcy, insolvency, reorganization, moratorium or
         other similar laws affecting creditors' rights generally;

(v)      there are no pending or, to the best of Borrower's knowledge, threatened actions
         or proceedings before any court, arbitrator or administrative agency which individually
         (or in the aggregate in the case of any group of related lawsuits) is expected to
         have a material and adverse effect on the financial condition of the Borrower or the
         ability of the Borrower to perform its obligations under the Operative
         Documents;

(vi)     except for (A) the filing for recording pursuant to the Federal Aviation Act of the
         FAA Bill of Sale for each Aircraft (and the application for registration of such
         Aircraft in the name of the Borrower) and the Mortgage with the Mortgage Supplement
         for each Aircraft, (B) the filing of financing statements (and continuation
         statements at periodic intervals) with respect to the interests created by such
         documents under the Uniform Commercial Code of Colorado and such other states as
         may be specified in the opinion furnished pursuant to Section 4(b)(ix) hereof and
         (C) the affixation of the nameplates referenced in Section 3.04 of the Mortgage,
         no further action, including any filing or recording of any document
         (including any financing statement in respect thereof under Article 9 of the
         Uniform Commercial Code of any applicable jurisdiction), is necessary or
         advisable in order to establish and perfect the first mortgage Lien on each
         Aircraft in favor of the Administrative Agent pursuant to the Mortgage in any
         applicable jurisdiction in the United States;

(vii)    there has not occurred any event which constitutes a Default or an Event of Default
         hereunder which is presently continuing;

(viii)   the statements of financial position of the Borrower as of December 31, 2001 and
         the date of the most recently concluded fiscal quarter of the Borrower for which
         a statement of financial position has been provided and the related statements of
         earnings and cash flow of the Borrower in all material respects for the year and
         fiscal quarter, respectively, then ended, copies of which have been furnished to
         the Lenders, fairly present the financial condition of the Borrower at such date
         and the results of operations and cash flow of the Borrower for the period
         ended on such dates, in accordance with generally accepted accounting
         principles consistently applied, and subject, in the case of the statements
         pertaining to the Borrower's most recently concluded fiscal quarter, to normal
         year-end adjustments, and since December 31, 2001, there has been no material
         and adverse change in the business or financial condition of the Borrower;

(ix)     on such Delivery Date the Borrower will have good title to the Mortgage Estate
         delivered on such Delivery Date free and clear of all Liens, except the Lien of
         the Mortgage, and Inchoate Liens;

(x)      neither the Borrower nor anyone acting on behalf of the Borrower has directly or
         indirectly offered any interest in the Notes for sale to, or solicited any offer
         to acquire any of the same from, anyone other than the Lenders and not more than
         35 other institutions believed capable of evaluating and bearing the risks of
         investment in the transactions contemplated hereby;

(xi)     the Borrower has filed or caused to be filed all Federal, state, local and (to the
         best of Borrower's knowledge) foreign tax returns which are required to be filed
         and has paid or caused to be paid or provided adequate reserves for the payment of
         all taxes shown to be due and payable on such returns or (except to the extent being
         contested in good faith and by appropriate proceedings and for the payment of
         which adequate reserves have been provided in accordance with generally
         accepted accounting principles) on any assessment received by the Borrower, to
         the extent that such taxes have become due and payable, except such returns or
         taxes as do not materially and adversely affect the business, property or
         assets, operations or financial condition, of the Borrower and do not involve
         a material risk of the sale, forfeiture or loss of, or the creation of any
         Lien (other than a Permitted Lien) on the Aircraft;

(xii)    the Borrower is not (x) in default under any indenture, mortgage, lease or Credit
         Agreement or under any other agreement or instrument of a material nature to which
         the Borrower is now a party or by which it is bound, and no event has occurred and
         is continuing which, under the provisions of any such indenture, mortgage, Credit
         Agreement or other material agreement or instrument, with the lapse of time or
         the giving of notice, or both, would constitute a default thereunder or (y) in
         violation of any law, order, injunction, decree, rule or regulation applicable
         to the Borrower of any court or administrative body, which violation (a) would
         reasonably be expected to materially and adversely affect the business,
         operations or financial condition of the Borrower or the Borrower's ability to
         execute, deliver and perform its obligations under the Operative Documents or
         (b) would involve a material risk of the sale, forfeiture or loss of, or the
         creation of any Lien (other than a Permitted Lien) on, any of the Mortgage
         Estate;

(xiii)   the Borrower has not engaged in any transaction in connection with which the
         Borrower could be subjected to either a material civil penalty assessed pursuant
         to Section 502(i) of ERISA, or a material tax imposed by Section 4975 of the Code;
         (w) no material liability to the Pension Benefit Guaranty Corporation (other than
         liability for premiums) has been incurred by the Borrower with respect to any Plan;
         (x) there has been no event or condition which presents a material risk of
         termination of any Plan by the Pension Benefit Guaranty Corporation; (y) no
         accumulated funding deficiency (as defined in Section 302 of ERISA and
         Section 412 of the Code), whether or not waived, exists with respect to any
         Plan; and (z) no material amount of "withdrawal liability," as that term is
         used in Section 4201 of ERISA, has been or is expected to be incurred by the
         Borrower nor has the Borrower or any affiliate of the Borrower been notified
         by any multi-employer plan (within the meaning of Section 3(37)(A) of ERISA)
         that such multi-employer plan is in reorganization or insolvency within the
         meaning of Section 4241 or Section 4245 of ERISA or that such multi-employer
         plan intends to terminate or has been terminated under Section 4041A of ERISA
         (for purposes of this subclause (z), the term "affiliate" shall mean any
         corporation or person which is a member of the same controlled group of
         corporations (within the meaning of Section 414(b) of the Code) as the
         Borrower or is under common control (within the meaning of Section 414(c) of
         the Code) with the Borrower);

(xiv)    neither the Borrower nor any Plan nor any trust created thereunder has engaged in
         a "prohibited transaction," within the meaning of Section 406 of ERISA or Section
         4975 of the Code with respect to the transactions contemplated hereby which could
         subject the Borrower to any tax or penalty pursuant to Section 4975 of the
         Code or Section 502(i) of ERISA;

(xv)     the Borrower is not an "investment company" as defined in, or subject to regulation
         under, the Investment Company Act of 1940 and the Borrower is not a "holding
         company" as defined in, or subject to regulation under, the Public Utility Holding
         Company Act of 1935;

(xvi)    none of the reports, financial statements, certificates or other information
         furnished by or on behalf of the Borrower to the Administrative Agent or the
         Lenders in connection with the negotiation of this Agreement or delivered hereunder
         (as modified or supplemented by other information so furnished) contains any
         material misstatement of fact or omits to state any material fact necessary to
         make the statements therein, in the light of the circumstances under which they
         were made, not misleading; and

(xvii)   no part of the proceeds of any Loan hereunder will be used, whether directly or
         indirectly, for any purpose that entails a violation of any of the Regulations of
         the Board of Governors of the Federal Reserve, including Regulations U and X.

(b)      Representations and Warranties of Administrative Agent and Lenders.

                  Each Lender severally represents and warrants to each of the other
Parties hereto, as of the date hereof and as of each Delivery Date that:

(i)      it is acquiring its Notes in the ordinary course of its commercial banking
         business and it has no present intention of distributing or reselling any interest
         to be acquired by it hereunder or under any of the other Operative Documents or
         any part thereof in violation of the Securities Act of 1933, as amended; and

(ii)     no part of the funds to be used by it to purchase or fund, as the case may be,
         its Notes or its interest under any of the Operative Documents constitutes plan
         assets of an employee benefit plan which is subject to the United States Employee
         Retirement Income Security Act of 1974, as amended ("ERISA") and/or subject
         to Section 4975 of the United States Internal Revenue Code of 1986, as amended.
         As used in this Section 7(b)(ii), the term "plan assets" shall have the meaning
         assigned to such term under ERISA and the regulations promulgated thereunder.

Section 8.        Indemnities.

(a)      General Indemnity.  Subject to the next following paragraph but without
limiting any other rights that any Indemnitee may have under the other Operative Documents
or applicable law, the Borrower hereby agrees to indemnify each Indemnitee on an after-tax
basis against, and agrees to protect, save and keep harmless each of them from any and all \
Expenses imposed on, incurred by or asserted against any Indemnitee arising out of or
resulting from (i) the operation, possession, use, maintenance, overhaul, testing,
registration, reregistration, delivery, non-delivery, lease, nonuse, modification, alteration,
or sale of any Aircraft, Airframe or Engine, or any engine used in connection with any
Airframe or any part of any of the foregoing by the Borrower, any lessee or any other
Person whatsoever, whether or not such operation, possession, use, maintenance,
overhaul, testing, registration, reregistration, delivery, non-delivery, lease,
nonuse, modification, alteration, or sale is in compliance with the terms of the
Mortgage, including, without limitation, claims for death, personal injury or property
damage or other loss or harm to any person whatsoever and claims relating to any laws,
rules or regulations pertaining to such operation, possession, use, maintenance,
overhaul, testing, registration, reregistration, delivery, non-delivery, lease,
non-use, modification, alteration, sale or return including environmental control,
noise and pollution laws, rules or regulations; (ii) the manufacture, design,
purchase, acceptance, rejection, delivery, or condition of any Aircraft, Airframe or
Engine, any engine used in connection with any Airframe, or any part of any of the
foregoing including, without limitation, latent and other defects, whether or not
discoverable, or trademark or copyright infringement; (iii) any breach of or failure
to perform or observe, or any other noncompliance with, any covenant or agreement to
be performed, or other obligation of the Borrower under any of the Operative
Documents, or the falsity of any representation or warranty of the Borrower in any of
the Operative Documents; and (iv) any Event of Default hereunder or the enforcement
against the Borrower of any of the terms hereof (including, without limitation,
Section 12 hereof).

                  The foregoing indemnity shall not extend to any Expense of any
Indemnitee to the extent attributable to one or more of the following:  (1) acts or
omissions involving the willful misconduct or gross negligence of such Indemnitee or
any Person acting on behalf of such Indemnitee (other than gross negligence imputed to
such Indemnitee solely by reason of its interest in an Aircraft, as finally determined
by a court of competent jurisdiction); (2) any Tax, or increase in tax liability under
any tax law (such matter being the subject to the indemnity in Sections 8(b) and (c)
hereof); (3) a failure on the part of the Administrative Agent to distribute in
accordance with the Operative Documents any amounts received and distributable by it
thereunder; (4) any breach of undertaking or any misrepresentation contained herein or
in any other Operative Document to which such Indemnitee is a party or any agreement
relating hereto or thereto by such Indemnitee and in each case not attributable
directly to any breach of undertaking, any misrepresentation or any noncompliance with
any of the terms hereof or of any other Operative Document or any agreement relating
hereto or thereto by Borrower; (5) attributable to a Lender Lien; or (6) any Expenses
as a result of a violation of the Securities Act (as defined below) relating to or
arising out of the offer, issuance, sale or delivery by such Indemnitee (or any person
who controls such Indemnitee within the meaning of Section 15 of the Securities Act of
1933 (the "Securities Act"), as amended) of any security based upon the credit of the
Borrower.

                  If a claim is made against an Indemnitee involving one or more
Expenses and such Indemnitee has notice thereof, such Indemnitee (or its agent) shall
promptly after receiving such notice give notice of such claim to the Borrower;
provided that the failure to provide such notice shall not release the Borrower from
any of its obligations to indemnify hereunder except to the extent that the Borrower
is prejudiced as a result of the failure to give such notice in a timely fashion, and
no payment by the Borrower to an Indemnitee pursuant to this Section 8(a) shall be
deemed to constitute a waiver or release of any right or remedy which the Borrower may
have against such Indemnitee for any actual damages as a result of the failure by such
Indemnitee to give the Borrower such notice.  The Borrower shall be entitled, at its
sole cost and expense, acting through a single counsel reasonably acceptable to the
respective Indemnitee, so long as the Borrower has acknowledged in writing its
responsibility for such Expense hereunder (unless such Expense is covered by the
second paragraph of this Section 8(a), except that such acknowledgment does not apply
if the decision of a court or arbitrator provides that the Borrower is not liable
hereunder), (A) in any judicial or administrative proceeding that involves solely a
claim for one or more Expenses, to assume responsibility for and control thereof,
(B) in any judicial or administrative proceeding involving a claim for one or more
Expenses and other claims related or unrelated to the transactions contemplated by the
Operative Documents, to assume responsibility for and control of such claim for
Expenses to the extent that the same may be and is severed from such other claims (and
such Indemnitee shall use its reasonable efforts to obtain such severance), and (C) in
any other case, to be consulted by such Indemnitee with respect to judicial
proceedings subject to the control of such Indemnitee and to be allowed, at the
Borrower's sole expense, to participate therein.  The Indemnitee may participate at
its own expense and with its own counsel in any judicial proceeding controlled by the
Borrower pursuant to the preceding provisions.  Notwithstanding any of the foregoing,
the Borrower shall not be entitled to assume responsibility for and control of any
such judicial or administrative proceedings if any Event of Default shall have
occurred and be continuing, if such proceedings will involve a material risk of the
sale, forfeiture or loss of an Aircraft unless the Borrower shall have posted a bond
or other security reasonably satisfactory to the relevant Indemnitee with respect to
such risk or if such proceedings could entail any risk of criminal liability being
imposed on such Indemnitee.

                  The Indemnitee shall supply the Borrower with such information
reasonably requested by the Borrower as is necessary or advisable for the Borrower to
control or participate in any proceeding to the extent permitted by this
Section 8(a).  Such Indemnitee shall not enter into a settlement or other compromise
with respect to any Expense without the prior written consent of the Borrower, which
consent shall not be unreasonably withheld or delayed, unless such Indemnitee waives
its right to be indemnified with respect to such Expense under this Section 8(a).  In
the case of any Expense indemnified by Borrower hereunder which is covered by a policy
of insurance maintained by Borrower, each Indemnitee agrees, at Borrower's expense, to
cooperate reasonably with the insurers in the exercise of their rights to investigate,
defend or compromise such loss or liability as may be reasonably required to retain
the benefits of such insurance with respect to such loss or liability.

                  To the extent of any payment of any Expense pursuant to this
Section 8(a), the Borrower, without any further action, shall be subrogated to any
claims the Indemnitee may have relating thereto.  The Indemnitee agrees to give such
further assurances or agreements and to cooperate with the Borrower to permit the
Borrower to pursue such claims, if any, to the extent reasonably requested by the
Borrower.

                  In the event that the Borrower shall have paid an amount to an
Indemnitee pursuant to this Section 8(a), and such Indemnitee subsequently shall be
reimbursed in respect of such indemnified amount from any other Person, such
Indemnitee shall promptly pay the Borrower the amount of such reimbursement, including
interest received attributable thereto, provided that no Special Default or Event of
Default has occurred and is continuing.

                  Amounts payable under this Section 8(a) shall be payable by the
Borrower within thirty days of demand therefor.

(b)      General Tax Indemnity.

(i)      Subject to the exclusions described in Section 8(b)(ii) below, any and all payments
         by the Borrower to the Administrative Agent or any Lender (each, a "Tax Indemnitee")
         under this Agreement or any of the other Operative Documents shall be made free
         and clear of and without deduction for any and all present or future taxes, levies,
         imposts, deductions, charges or withholdings, and all liabilities with respect
         thereto, excluding taxes measured by or based on net or taxable income (all
         such non-excluded taxes, levies, imposts, deductions, charges, withholdings
         and liabilities being hereinafter referred to as "Taxes").  If any Taxes shall
         be required by law to be deducted from or in respect of any sum payable under
         this Agreement to any Tax Indemnitee, then (i) the sum payable by the Borrower
         shall be increased as may be necessary so that after making all required
         deductions in respect of such Taxes (including deductions applicable to
         additional sums payable under this Section) such Tax Indemnitee (as the case
         may be) receives an amount equal to the sum it would have received had no such
         deductions been made, (ii) the Borrower shall make such deductions, and (iii)
         the Borrower shall pay the full amount deducted to the relevant taxation
         authority or other authority in accordance with applicable law.  The Borrower
         shall not, however, be required to pay amounts, if any, pursuant to clause (i)
         of the preceding sentence to any Tax Indemnitee organized under the laws of a
         jurisdiction outside of the United States of America unless such Tax
         Indemnitee provides or has provided to the Borrower a completed Internal
         Revenue Service Form W-8ECI or Form W-8BEN, or any successor form, or
         Form W-9, or any successor form, and any other applicable form, certificate or
         document prescribed by the Internal Revenue Service of the United States
         certifying as to such Tax Indemnitee's entitlement to an exemption from, or
         reduction of, United States withholding tax on payments to be made hereunder
         and any new or other forms or certificates prescribed by the Internal Revenue
         Service of the United States in the event that a lapse in time or change in
         circumstance renders a previous certification obsolete or inaccurate in any
         material respect.

                  The Borrower agrees to pay any present or future stamp, recording or
documentary taxes or similar levies that arise from any payment made under this
Agreement or under any other Operative Document or from the execution, delivery or
registration of, or otherwise with respect to, this Agreement or any other Operative
Document (hereinafter referred to as "Other Taxes").

                  The Borrower will indemnify each Tax Indemnitee on an after-tax basis
for the full amount of Taxes or Other Taxes (including any Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this Section) paid by such Tax
Indemnitee  and any liability (including penalties, interest, additions to tax and
expenses) arising therefrom or with respect thereto, whether or not such Taxes or
Other Taxes were correctly or legally asserted.  The Borrower shall pay any
indemnification requested under this Section within 30 days from the date any Tax
Indemnitee or  their respective agent (as the case may be) makes written demand
therefor.

                  Within 30 days after the date of any payment of Taxes or Other Taxes,
the Borrower will furnish to the relevant Tax Indemnitee the original or a certified
copy of a receipt or other documents reasonably acceptable to the relevant Tax
Indemnitee evidencing payment of such Taxes or Other Taxes.

                  If, as a result of an assignment under Section 24(c)(iii) below, a
Person organized under the laws of a jurisdiction outside of the United States becomes
a Tax Indemnitee and payments to it to be made under this Agreement are exempt from
United States withholding tax, or are subject to such tax at a reduced rate under an
applicable tax treaty, then such assignee shall provide to the Borrower, promptly
following the date that it became a Tax Indemnitee and from time to time thereafter,
so long as it is lawfully able to do so in its reasonable judgment, a properly
completed and executed Internal Revenue Service Form W-8ECI or Form W-8BEN or Form
W-9, or any successor form, and any other applicable form, certificate document
prescribed by the Internal Revenue Service certifying as to such assignee's
entitlement to such exemption or reduced rate with respect to all payments to be made
to such assignee under this Agreement and any new or other forms or certificates
prescribed by the Internal Revenue Service of the United States in the event that a
lapse in time or change in circumstance renders a previous certification obsolete or
inaccurate in any material respect.  Unless the Borrower shall have received forms or
other documents reasonably satisfactory to it establishing that payments under this
Agreement are not subject to United States withholding tax, or are subject to such tax
at a rate under an applicable tax treaty, the Borrower shall, subject to its
obligations under Section 8(a), withhold taxes from such payments at the applicable
statutory rate in the case of payments to or for any Tax Indemnitee, if it is
organized under the laws of a jurisdiction outside the United States.

                  Within 30 days after written request from the Borrower the relevant
Tax Indemnitee, as appropriate, shall, so long as no Default or Event of Default shall
have occurred, execute and deliver to the Borrower such certificates, forms or other
documents which can be furnished consistent with the facts and applicable law, and
which are reasonably necessary for the Tax Indemnitee to obtain a refund of Taxes
indemnified by the Borrower under this Section (which shall be paid to the Borrower
promptly upon receipt).

                  Without prejudice to the survival of any other provision of this
Agreement, the agreements and obligations of the Borrower contained in this Section
shall survive the repayment in full of the Loans.

(ii)     Exclusions.  In addition to any exclusions described in Section 8(b)(i)
         above, the foregoing tax indemnity shall not apply to:

(A)      Taxes imposed on a Tax Indemnitee resulting from such Tax Indemnitee not claiming
                  any applicable exemption or rate reduction under any applicable law or
                  treaty (unless such Tax Indemnitee provides, at Borrower's expense, an
                  opinion of independent counsel, selected by such Tax Indemnitee and
                  reasonably acceptable to Borrower, that there is no reasonable basis
                  for such claim; provided that, Borrower notifies such Tax Indemnitee
                  in writing that any such exemption is available and such Tax
                  Indemnitee determines in good faith that neither it nor any Affiliate
                  will be adversely impacted by claiming any such applicable exemption);

(B)      Taxes imposed on a Tax Indemnitee resulting from such Tax Indemnitee failing to
                  comply with certification, information, documentation, reporting or
                  similar requirements concerning the nationality, residence, identity or
                  connection with the jurisdiction imposing such Taxes if such Tax
                  Indemnitee was aware of the requirement to comply and such Tax
                  Indemnitee's compliance is required by applicable law or treaty as a
                  precondition to relief or exemption from such Taxes and such Tax
                  Indemnitee was eligible for such relief or exemption, unless such
                  failure to comply was due to failure of Borrower timely to notify the
                  Tax Indemnitee in writing of such requirement or to provide
                  reasonable assistance in complying with such requirement or the Tax
                  Indemnitee determines in good faith that either it or any Affiliate
                  will be adversely impacted by so complying;

(C)      Taxes imposed on a Tax Indemnitee resulting from the actual gross negligence (other
                  than gross negligence or willful misconduct imputed or attributed to such
                  Tax Indemnitee by reason of its interest in any Aircraft, Engine or Part)
                  or willful misconduct of such Tax Indemnitee;

(D)      Taxes imposed upon a Tax Indemnitee as a result of any transfer by such Tax
                  Indemnitee of any Aircraft, Engine or Part or the Lease or any other
                  Operative Document or of such Tax Indemnitee's interest in any thereof
                  unless such transfer is requested by Borrower or occurs at a time when
                  an Event of Default has occurred and is continuing;

(E)      Taxes imposed upon any Tax Indemnitee in its individual capacity based on or
                  measured by fees for services rendered under the Operative Documents; and

(F)      Taxes imposed upon any Tax Indemnitee with respect to any period after (1) the
                  termination of the Mortgage, in accordance with the terms thereof and (2)
                  payment of all amounts payable under the Operative Documents having been made.

                                    (For purposes of this Agreement and the other
                  Operative Documents, Taxes, other than those exempted in Section
                  8(b)(i) or by virtue of clauses (A) through (F) above, are
                  hereinafter referred to as "Indemnified Taxes".)

                                    In the event of a dispute between Borrower and any
                  Tax Indemnitee regarding the applicability of any of the exclusions
                  described in Section 8(b)(i) or Section 8(b)(ii) or the amount of any
                  Indemnified Taxes, Borrower within 30 days of demand therefor shall
                  pay to such Tax Indemnitee any amount of Tax claimed to be owed
                  pursuant to Section 8(b)(i), as the case may be.  Any payment made by
                  Borrower pursuant to the immediately preceding sentence shall be
                  refunded by the relevant Tax Indemnitee if it subsequently is on a
                  final and unconditional basis established that such amount was not
                  required to be paid under this Section 8(b)(i) or (b)(ii) hereof, as
                  the case may be.

(iii)    Contest.  If a claim is made against any Tax Indemnitee for any Indemnified
         Taxes (a "Claim"), such Tax Indemnitee will, as promptly as practical after
         such Tax Indemnitee has received written notification of such Claim, give Borrower
         written notice of such Claim; provided that, that a failure to give such
         notice in a timely manner shall not preclude a Claim for indemnification hereunder
         except to the extent that the Borrower is prejudiced as a result of the failure to
         give such notice in a timely fashion.  If Borrower so requests in writing within
         thirty (30) calendar days after receipt of such notice, such Tax Indemnitee shall
         consult with Borrower to consider what action may be taken to resist payment
         of the relevant Indemnified Taxes and following such consultation such Tax
         Indemnitee may take any reasonable action in the name of such Tax Indemnitee
         to contest the Claim in the name of such Tax Indemnitee or, in such Tax
         Indemnitee's sole discretion, in the name of Borrower, to the extent permitted
         by law; provided that, the following conditions are met:

(A)      such Tax Indemnitee shall have received adequate provision satisfactory to it for
                  such Claim and any liability, expense or loss arising out of or related
                  to such contest (including without limitation indemnification for all
                  costs, expenses, losses, reasonable legal and accounting fees and
                  disbursements, penalties and interest);

(B)      the contest will not result in any danger of the sale, forfeiture or loss of, or
                  the creation of any Lien on, any Aircraft, any Engine, any Part, or any
                  interest therein unless bonded in a manner and amount acceptable to the
                  Tax Indemnitees;

(C)      if such contest shall be conducted in a manner requiring the payment of the Claim,
                  Borrower shall have paid such Claim to the extent required;

(D)      no Default or Event of Default shall have occurred and be continuing;

(E)      prior to commencing any administrative appeal, Borrower shall have acknowledged
                  its liability to such Tax Indemnitee hereunder for the contested amount;

(F)      such Tax Indemnitee shall have received a legal opinion (at the expense of Borrower)
                  from counsel selected by such Tax Indemnitee (and reasonably satisfactory
                  to Borrower) indicating that a reasonable basis for such contest exists;
                  and

(G)      such Tax Indemnitee has not received, or does not receive, an opinion from its
                  external tax advisor concluding that the proposed actions to contest such
                  Claim would trigger a significant possibility of creating a local franchise
                  issue of the Tax Indemnitee (e.g., adverse publicity or impairing of the
                  Tax Indemnitee's relationship with local regulators) or impairing the
                  status of other open tax matters (e.g., tax audits) between such Tax
                  Indemnitee and the local taxing authorities.

                                    Notwithstanding the foregoing provisions of this
                  Section 8(b)(iii), no Tax Indemnitee shall be obligated to contest a
                  Claim to the United States Supreme Court.  In addition,
                  notwithstanding the foregoing provisions of this Section 8(b), if at
                  any time such Tax Indemnitee waives its right of indemnification
                  under this Section 8(b) in respect of a Claim, or if, after having
                  received payment of indemnification from Borrower hereunder in
                  respect of such Claim, such Tax Indemnitee tenders such payment to
                  Borrower, then Borrower shall not be entitled to contest, or to
                  continue to contest, any such Claim.

(iv)     If by reason of any Indemnified Taxes paid or otherwise indemnified against by the
         Borrower pursuant to this Section 8(b), any Tax Indemnitee at any time actually
         realizes a net reduction in any Taxes not indemnified against by the Borrower and
         not previously taken into account in computing the amount of any indemnity payable
         by the Borrower under this Section 8(b), such Tax Indemnitee shall, so long as
         no Special Default or Event of Default shall have occurred, promptly pay to
         the Borrower an amount that, after subtraction of any further Tax savings such
         Tax Indemnitee realizes as a result of the payment thereof, is equal to the
         amount of such net Tax reduction; provided that any subsequent loss of Tax
         benefit for which payment has been made to the Borrower under this Section
         8(b)(iv) (or was taken into account in computing an amount payable by the
         Borrower under this Section 8(b)) shall be treated as an indemnifiable Tax
         hereunder without regard to the exclusions set forth in Sections 8(b)(i) or
         8(b)(ii) hereof.

(v)      Verification.  At the Borrower's written request, the computation of the
         amount of any indemnity payment owed by the Borrower or any amount owed by a Tax
         Indemnitee to the Borrower pursuant to this Section 8 shall be verified and
         certified by an internationally recognized independent public accounting firm
         mutually selected by the Tax Indemnitee and the Borrower.  The costs of such
         verification (including the fee of such public accounting firm) shall be borne
         by the Borrower unless such verification shall result in an adjustment in the
         Borrower's favor of 5% or more of the net present value of the payment as
         computed by such Tax Indemnitee, in which case the costs shall be paid by such
         Tax Indemnitee.  Such determination shall be final and binding, absent
         manifest error on the part of the certified public accountants.  The Tax
         Indemnitees hereby agree to cooperate with the accountants in connection
         therewith, provided, however, notwithstanding anything that may be to the
         contrary in the Operative Documents, in no event shall the Borrower have the
         right to examine any information supplied to the verifying firm or the tax
         returns or books of the Tax Indemnitee in connection with the verifying
         procedures described herein or for any other reason.

(c)      Interest.  The Borrower will pay to each Indemnitee on demand, to the
extent permitted by applicable law, interest on any amount of indemnity not paid when due
pursuant to this Section 8 until the same shall be paid, at the Past Due Rate.

Section 9.        Covenants of the Borrower.

(a)      Borrower Merger.  For so long as the Mortgage remains in force, the Borrower
shall not consolidate with or merge into or with any other Person, and not convey, transfer,
lease or otherwise dispose of all or substantially all of its property and other assets to,
or acquire all or any substantial part of the property or other assets or capital stock of
(if such acquisition is analogous in either purpose or effect to a consolidation or
merger), any other Person, unless:

(i)      Such transaction shall not have any material adverse effect on the rights of the
         Lenders or the Administrative Agent under or in respect of the Operative Documents
         or the Aircraft;

(ii)     The Person formed by or surviving such consolidation or merger or the Person which
         acquires by conveyance, transfer, lease or other disposition all or substantially
         all of such property and other assets or stock (the "Successor Entity"): (A) shall
         be a corporation organized and existing under the laws of the United Sates or any
         state thereof or the District of Columbia; (B) immediately after giving effect
         to such transaction, shall be the Borrower or shall have acquired or succeeded
         to all or substantially all of the property and other assets of the Borrower
         (if such assets are being transferred) as an entirety, and shall have a
         tangible net worth (determined in accordance with GAAP) of not less than the
         Borrower's tangible net worth (determined in accordance with GAAP) immediately
         prior to such transaction; (C) shall be a U.S. Air Carrier; and (D) shall
         execute and deliver to the Administrative Agent such recordations and filings
         with any Governmental Authority and such other documents as the Administrative
         Agent (at the direction of the Lenders) determines shall be reasonably
         necessary or advisable to evidence, or in connection with, such consolidation,
         merger, sale, lease, transfer or other disposition and an agreement, in form
         and substance reasonably satisfactory to the Administrative Agent (at the
         direction of the Lenders) which is a legal, valid, binding and enforceable
         assumption by such Successor Entity of the due and punctual performance and
         observance of each covenant and condition of the borrower under the Operative
         Documents to which the Borrower is a party, and an officer's certificate to
         such effect and to the effect that the other requirements of this Section have
         been satisfied, and a legal opinion from counsel to such effect and otherwise
         in such form and substance reasonably satisfactory to the Administrative Agent
         (at the direction of the Lenders);

(iii)    Such Person shall have a credit rating (as determined by S&P or Moody's, as
         applicable) no worse than the Borrower's immediately prior to such transaction;
         and

(iv)     No Default shall have occurred and be continuing or shall occur as a result thereof.

         Upon any consolidation or merger in accordance with this Section 9(a), the
Successor Entity shall succeed to, and be substituted for, and may exercise every
right and power of, the Borrower under this Agreement with the same effect as if such
Successor Entity had been named as the Borrower herein.

(b)      U.S. Air Carrier.  The Borrower covenants and agrees that at all times it
will be an "air carrier" within the meaning of the Federal Aviation Act operating under
certificates issued pursuant to Section 40102(a) of such Act and shall otherwise meet the
standards of the definition of U.S. Air Carrier.

(c)      Further Assurances.  The Borrower covenants and agrees with each party hereto
         as follows:

(i)     The Borrower will cause to be done, executed, acknowledged and delivered all and
         every such further acts, conveyances and assurances as the Lenders shall reasonably
         require for accomplishing the purposes of this Agreement and the other Operative
         Documents; provided that any instrument or other document so executed by the
         Borrower will not expand any obligations or limit any rights of the Borrower
         in respect of the transactions contemplated by any Operative Documents.  The
         Borrower shall cause each Aircraft to remain duly registered, in the name of
         the Borrower, except as otherwise required or permitted hereunder or under the
         Mortgage, under the Federal Aviation Act.

(ii)     The Borrower, at its expense, will cause (A) the Mortgage, all Mortgage Supplements
         and all amendments to the Mortgage to be promptly filed and recorded, or filed for
         recording, to the extent permitted under the Federal Aviation Act, or required
         under any other applicable law and (B) the lien of the Mortgage to at all times be
         and remain a first priority and perfected Lien on the Mortgage Estate.  The
         Borrower agrees to furnish the Administrative Agent and the Lenders with
         copies of the foregoing documents with recording data as promptly as
         practicable following the issuance of same by the FAA.

(iii)    The Borrower shall pay all reasonable costs and expenses (including costs and
         disbursements of counsel)incurred by the Administrative Agent and the Lenders
         after the date hereof in connection with (x) any supplements or amendments of the
         Operative Documents (including, without limitation, any related recording costs)
         (other than any supplement or amendment associated with a transfer of any Note or
         the sale of participation interests therein not requested by Borrower), (y) any
         Default and any enforcement or collection proceedings resulting therefrom or in
         connection with the negotiation of any restructuring or "work-out" (whether or
         not consummated), or (z) the enforcement of this Section 9.

(d)      Liens.  The Borrower will not directly or indirectly create, incur, assume
or suffer to exist any Lien on or with respect to the Mortgage Estate, title thereto or any
interest therein except (i) the rights of the Borrower as herein provided, the Lien of the
Mortgage and any other rights existing pursuant to the Operative Documents, (ii) Liens for
Taxes of the Borrower either not yet due or being contested in good faith by appropriate
proceedings (and for which adequate reserves have been provided in accordance with
generally accepted accounting principles), so long as the continuing existence of such
Liens during such proceedings do not involve any material risk of the sale, forfeiture
or loss of any Airframe or any Engine or any interest therein, (iii) mechanics',
material suppliers', workers', repairers', employees' or other like Liens arising in
the ordinary course of the Borrower's business for amounts that are not overdue or are
being contested diligently and in good faith by appropriate proceedings (and for which
adequate reserves have been provided in accordance with generally accepted accounting
principles), so long as there is not, or the continuing existence of such Liens during
such proceedings do not involve, any material risk of sale, forfeiture or loss of an
Airframe or any Engine or any interest therein, (iv) Liens arising out of any judgment
or award against the Borrower with respect to which an appeal or proceeding for review
is being prosecuted diligently and in good faith, so long as such Liens do not result
in a material risk of the sale, forfeiture or loss of any Airframe or any Engine or
any interest therein, (v) the rights of others under agreements or arrangements to the
extent expressly permitted by the terms of Sections 3.03, 4.02 and 4.04 of the
Mortgage, (vi) customary salvage or similar rights of insurers under policies required
to be maintained by the Borrower under Article VI of the Mortgage, (vii) any other
Lien with respect to which the Borrower shall have provided a bond or other security
in an amount and under terms reasonably satisfactory to the Administrative Agent and
(viii) Lender Liens.  The Borrower will promptly, at its own expense, take (or cause
to be taken) such actions as may be necessary duly to discharge any Lien not excepted
above if the same shall arise at any time.

(e)      Inspection.  At reasonable times, the Administrative Agent or its authorized
representatives on behalf of the Lenders, may inspect the Aircraft and FAA (or other '
applicable governmental authority) required books and records of the Borrower relating to
the maintenance of the Aircraft (at the inspecting party's expense (other than in the case
of an inspection occurring while an Event of Default has occurred and is continuing, in
which case the Borrower shall bear the reasonable cost of such inspection)) and shall
keep any information obtained thereby confidential as provided in Section 21 hereof.
Any such inspection of an Aircraft shall be upon reasonable advance notice from such
inspecting party to the Borrower, shall be during normal business hours and shall be a
visual, walk-around inspection (including on-board inspection) and may include
inspection of areas exposed by any open panels, bays or the like, but shall not
include opening any panels, bays or the like without the express written consent of
the Borrower; provided that, so long as no Event of Default shall have occurred and be
continuing, no exercise of such inspection right shall interfere with the normal
operation or maintenance of the Aircraft by, or the business of, the Borrower.  The
Administrative Agent shall not have any duty to make any such inspection nor shall it
incur any liability or obligation by reason of not making any such inspection.

(f)      Amendments, Supplements, Etc.  Forthwith upon the execution and delivery
of each Mortgage Supplement from time to time required by the terms of the Mortgage and
upon the execution and delivery of any amendment to the Mortgage or this Agreement, the
Borrower will cause such Mortgage Supplement or amendment to be duly filed and recorded,
and maintained of record, in accordance with the applicable laws of the government of
registry of the Aircraft.  In addition, the Borrower will promptly and duly execute and
deliver to the Lenders and the Administrative Agent (on behalf of the Lenders) such further
documents and take such further action as the Lenders or the Administrative Agent (on
behalf of the Lenders) may from time to time reasonably request in order to more effectively
carry out the intent and purpose of the Mortgage and to establish and protect the
rights and remedies created or intended to be created in favor of the Administrative
Agent and the Lenders hereunder and under the Mortgage, including, without limitation,
if requested by the Administrative Agent, at the expense of Borrower, the execution
and delivery of supplements or amendments hereto, each in recordable form, subjecting
to the Mortgage any engine substituted for any Engine pursuant to the terms thereof
and the recording or filing of counterparts hereof, in accordance with the laws of
such jurisdiction as the Administrative Agent may reasonably request.

(g)      Access to or Furnishing of Information.  The Borrower agrees to furnish to
the Administrative Agent (and the Administrative Agent shall provide to the Lenders):

(i)      as soon as available, but not later than 90 days after the close of each fiscal
         year of the Borrower occurring after the date hereof, an audited balance sheet and
         related statements of the Borrower at and as of the end of such fiscal year, together
         with an audited statement of income and cash flows of the Borrower for such
         fiscal year, each of which shall be prepared in accordance with GAAP and shall
         be accompanied by an unqualified opinion of a firm of independent public
         accountants of nationally recognized standing that said financial statements
         fairly present in all material respects the financial condition and results of
         operation of the Borrower as at the end of, and for, such period in accordance
         with GAAP;

(ii)     as soon as available, but not later than 60 days after the close of each of the
         first three quarters of each fiscal year of the Borrower, an unaudited balance
         sheet of the Borrower at and as of the end of such quarter, together with an
         unaudited statement of income and cash flows of the Borrower for such quarter,
         each of which shall be prepared in accordance with GAAP, certified by the Chief
         Financial Officer of the Borrower that said financial statements fairly present
         in all material respects the financial condition and results of operation of the
         Borrower as at the end of, and for, such period in accordance with GAAP (subject
         to normal year-end audit adjustments);

(iii)    on an annual basis, together with the financial statements delivered pursuant to
         the preceding paragraph (i), a certificate of the chief financial officer, Treasurer,
         any Vice President, or other officer of the Borrower elected by the Borrower's
         Board of Directors stating that such authorized officer has reviewed the
         activities of the Borrower and that, to the best knowledge of such authorized
         officer, there exists no Default or Event of Default hereunder;

(iv)     simultaneously with the mailing thereof to its shareholders, copies of all such
         financial statements, SEC Forms 10-K and 10-Q reports, notices of proxy statements
         as the Borrower shall mail to its shareholders generally;

(v)      from time to time, such other information as the Administrative Agent or any Lender
         may reasonably request; and

(vi)     promptly after the occurrence thereof and actual knowledge thereof by a responsible
         officer of the Borrower, notice to the Administrative Agent and the Lenders of any
         Default or Event of Default.

Section 10.       The Notes.

(a)      Method of Payment.  Principal and interest and other amounts due hereunder or
under the Notes or in respect hereof or thereof shall be payable in Dollars in immediately
available funds prior to 11:00 a.m., New York, New York time, on the due date thereof, to
the Administrative Agent at the Payment Office and the Administrative Agent shall, subject
to the terms and conditions hereof and of the Mortgage, remit all such amounts so
received by it to each Lender at the account set forth in Schedule I hereto or to such
other account or accounts as such Lender may designate to the Administrative Agent in
writing from time to time, in immediately available funds for distribution to the
Lenders, such payment to be made, in the case of any such designated account in New
York, New York, prior to 1:00 p.m., New York time, on the due date thereof.  In the
event the Administrative Agent shall fail to make any such payment as provided in the
immediately foregoing sentence after its receipt of funds at the place and prior to
the time specified above, the Administrative Agent agrees to compensate the Lenders
for loss of use of funds in a commercially reasonable manner.  All such payments by
the Borrower and the Administrative Agent shall be made free and clear of and without
reduction on account of all wire and other like charges.  Prior to the due presentment
for registration of transfer of any Note, the Borrower and the Administrative Agent
may deem and treat the Person in whose name any Note is registered on the Note
Register as the absolute owner of such Note for the purpose of receiving payment of
all amounts payable with respect to such Note and for all other purposes whether or
not such Note shall be overdue, and neither the Borrower nor the Administrative Agent
shall be affected by any notice to the contrary.

(b)      Application of Payments.  Except as otherwise expressly provided herein, each
payment of principal and interest or other amounts due in respect of each Note shall be
distributed to each Lender ratably, without priority of any one Note over any other Note,
in the proportion that the amount of such payment or payments then due under each Note
bears to the aggregate amount of the payments then due under all Notes.  Each such payment
shall, except as otherwise expressly provided herein, be applied, first, to the
payment of any amount (other than the principal of or interest on such Note) due in
respect of such Note, second, to the payment of interest on such Note (as well as any
interest on overdue principal and, to the extent permitted by law, interest and other
amounts payable thereunder) due thereunder, third, to the payment of the principal of
such Note then due and fourth, the balance, if any, remaining thereafter, to the
payment of the principal of such Note remaining unpaid (provided that such Note shall
not be subject to prepayment without the consent of such Lender except as permitted by
Sections 10(f) and 10(g) hereof).  The amounts paid pursuant to clause fourth above
shall be applied to the installments of principal of such Note in inverse order of
maturity.

(c)      Registration, Transfer and Exchange of Notes.  The Administrative Agent agrees
with the Borrower that the Administrative Agent shall keep a register (herein sometimes
referred to as the "Note Register") in which provision shall be made for the
registration of Notes of each Series and the registration of transfers of Notes of such
Series.  Prior to the due presentment for registration of the transfer of any Note, the
Borrower and the Administrative Agent shall deem and treat the person in whose name such
Note is registered on the Note Register as the absolute owner of such Note, and the Lender
for the purpose of receiving payment of all amounts payable with respect to such Note, and
for all other purposes whether or not such Note is overdue, and neither the Borrower
nor the Administrative Agent shall be affected by notice to the contrary.  The Note
Register shall be kept at the office of the Administrative Agent or at the office of
any successor Administrative Agent, and the Administrative Agent is hereby appointed
"Note Registrar" for the purpose of registering Notes and transfers of Notes as herein
provided.  Subject to Section 24(c) hereof, upon surrender for registration of
transfer of any Note of any Series at the Payment Office and upon delivery by the
Administrative Agent to the Borrower of such surrendered Note, the Borrower shall
execute, and the Administrative Agent shall deliver, in the name of the designated
transferee or transferees, one or more new Notes of a like aggregate principal amount
and Series.  At the option of the Lender, its Notes of any Series may be exchanged for
other Notes of such Series of any authorized denominations, of a like aggregate
principal amount, upon surrender of the Notes to be exchanged at the Payment Office.
Each new Note issued upon transfer or exchange shall be in a principal amount of at
least $5,000,000 (except as may be necessary to evidence the entire outstanding
principal amount of a Note) and dated the Delivery Date of the Aircraft of the related
Series.  Whenever any Notes are so surrendered for exchange, the Borrower shall
execute and deliver the Notes which the Lender making the exchange is entitled to
receive.  All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Borrower evidencing the same respective
obligations, and entitled to the same security and benefits under the Mortgage, as the
Notes surrendered upon such registration of transfer or exchange.  Every Note
presented or surrendered for registration of transfer or exchange, shall (if so
required by the Administrative Agent) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Administrative Agent duly executed
by the Lender or its attorney duly authorized in writing, and the Administrative Agent
may require evidence satisfactory to it as to the compliance of any such transfer with
the Securities Act and the securities laws of any applicable state.  The
Administrative Agent shall make a notation on each new Note or Notes of the amount of
all payments of principal previously made on the old Note or Notes with respect to
which such new Note is issued and the date to which interest accrued on such old Note
or Notes has been paid.  The Administrative Agent shall not be required to register
the transfer of or exchange any surrendered Notes as above provided during the five
calendar day period preceding the due date of any payment on such Notes.  The
Administrative Agent shall give the Borrower and the Lenders notice of each transfer
of a Note under this Section 10(c).  Any such transferee of a Note, by its acceptance
of a Note, agrees to the provisions of the Operative Documents applicable to the
Lenders, and shall be deemed to have covenanted to the parties to the Operative
Documents as to the matters covenanted by the original Lender therein; provided that
no transferee of a Note shall be entitled to receive any greater amount pursuant to
Section 10(h) of this Agreement than the transferor of such Note would have been
entitled to receive had no such transfer occurred.

(d)      Mutilated, Destroyed, Lost or Stolen Notes.  If any Note shall become mutilated,
destroyed, lost or stolen, the Borrower shall, upon the written request of the Lender,
execute and deliver in replacement thereof, a new Note of a like Series, in the same
principal amount, dated the date of such Note and designated as issued under the Mortgage.
If the Note being replaced has become mutilated, such Note shall be surrendered to the
Administrative Agent and the original thereof shall be furnished to the Borrower by
the Administrative Agent.  If the Note being replaced has been destroyed, lost or
stolen, the Lender shall furnish to the Borrower and the Administrative Agent such
security or indemnity as may be reasonably required by them to hold the Borrower and
the Administrative Agent harmless and evidence satisfactory to the Borrower and the
Administrative Agent of the destruction, loss or theft of such Note and of the
ownership thereof; provided, however, that if the Lender is an original party hereto
or an Affiliate thereof or a bank or other financial institution with a net worth (or
capital and surplus, as the case may be) in excess of $500,000,000, the written notice
of such destruction, loss or theft and such ownership and the written undertaking of
the Lender delivered to the Borrower and the Administrative Agent to hold harmless the
Borrower and the Administrative Agent in respect of the execution and delivery of such
new Note shall be sufficient evidence, security and indemnity.

(e)      Payment of Expenses on Transfer.  Upon the issuance of a new Note or new Notes
pursuant to Sections 10(c) or (d), the Borrower and/or the Administrative Agent may require
from the party requesting such new Note or Notes payment of a sum sufficient to reimburse
the Borrower and/or the Administrative Agent for, or to provide funds for, the payment
of any tax or other governmental charge in connection therewith or any charges and
expenses connected with such tax or other governmental charge paid or payable by the
Borrower or the Administrative Agent.

(f)      Prepayment.  (i) On at least ten Business Days' prior written notice, the Borrower
         may prepay on the date specified in its notice of prepayment delivered pursuant to this
         Section 10(f) in whole, or in part, the Notes of any Series then outstanding
         at the principal amount thereof (or portion thereof to be repaid), together
         with accrued interest thereon to the date of prepayment plus all Break Amount
         and Additional Costs, if any, and all other amounts due to each Lender
         hereunder, thereunder and under the other Operative Documents; provided that
         any partial prepayment shall be in an aggregate original principal amount of
         at least $5,000,000 and in $1,000,000 multiples thereof, and the amount
         thereof shall be specified in such written notice.  The Administrative Agent
         will give prompt notice to the Lenders of the Borrower's intent to prepay any
         Note.

(ii)     On at least ten Business Days' prior written notice, the Borrower shall prepay on the
         date specified in its notice of prepayment delivered pursuant to this Section 10(f)
         the Notes of any Series in full, but not in part, together with accrued interest thereon
         to the date of prepayment plus all Break Amount and Additional Costs, if any, and
         all other amounts due thereunder and hereunder and under the other Operative
         Documents to the Lenders upon the occurrence of an Event of Loss with respect
         to the related Airframe; such prepayment shall, in any event, be no later than
         the last day permitted for such payment under Section 5.01 of the Mortgage.
         The Administrative Agent will give notice of prepayment to the Lenders under
         this Section 10(f)(ii) promptly.

(iii)    Any notice of prepayment delivered pursuant to paragraph (i) or (ii) above shall be
         irrevocable if not revoked within five Business Days of the specified date of payment
         and shall identify the amount to be prepaid and the Series of Notes subject to
         prepayment.

(g)      Provisions Relating to Prepayment.  (i) Notice of prepayment having been given and not
         revoked as aforesaid, the principal amount of the Notes so to be prepaid, plus
         accrued interest thereon to the date of prepayment, together with the Break
         Amount and Additional Costs, if any, herein provided, shall become due and
         payable on the prepayment date.

(ii)     On the date fixed for prepayment under Section 10(f), immediately available funds
         in Dollars shall be deposited by the Borrower in the account of the Administrative
         Agent at the place and by the time and otherwise in the manner provided in Section
         10(a), in an amount equal to the principal amount of Notes to be prepaid together
         with accrued and unpaid interest thereon to the date fixed for such
         prepayment, all Break Amount and Additional Costs, if any, and all other
         amounts due to the Lenders hereunder, thereunder and under the other Operative
         Documents.

(iii)    Each Lender shall furnish to the Borrower, with a copy to the Administrative Agent,
         a certificate setting forth in reasonable detail the calculation of the amounts
         of Break Amount due to such Lender, which certificate shall be presumptively correct
         absent manifest error.

(h)      Increased Costs.  (i)  (i) The Borrower shall pay to the Administrative Agent for
         the account of each Lender from time to time such amounts as such Lender may determine
         to be necessary to compensate such Lender for any increase in actual costs that such
         Lender determines are attributable to its making, funding or maintaining its
         Commitment or the Loans or any reduction in any amount receivable by such
         Lender hereunder in respect of any of its Commitments or the Loans (such
         increases in costs and reductions in amounts receivable, including amounts
         covered by clause (ii) below, being herein called "Additional Costs"),
         resulting from any Regulatory Change that:

(A)      imposes any tax that is the functional equivalent of any reserve, special deposit or
                  similar requirement of the sort covered by clause (ii) below; or

(B)      imposes or modifies any reserve, special deposit or similar requirements (including
                  any Reserve Requirement) relating to any extensions of credit or other
                  assets of, or any deposits with or other liabilities of, any Lender
                  (including, without limitation, any of such loans or any deposits referred
                  to in the definition of "LIBOR" in Section 1.01 of the Mortgage), or any
                  such obligations; or

(C)      imposes any other condition affecting the Mortgage, or its Notes (or any of such
                  extensions of credit or liabilities) or any such obligation.

(ii)     Without limiting the effect of the foregoing provisions of this Section 10(h)
         (but without duplication), the Borrower shall pay to the Administrative Agent for
         account of any Lender from time to time on request such amount as the Lender may
         determine to be necessary to compensate such Lender (or, without duplication, the
         holding company of which such Lender is a subsidiary) for any increase in actual
         costs that it determines are attributable to the maintenance by such Lender (or any
         lending office or such holding company) of its Commitment or Loans hereunder,
         resulting from the implementation of any risk-based capital guideline, reserve
         requirement or other similar requirement hereafter issued by any Governmental
         Authority pursuant to any law or regulation or any interpretation, directive
         or request (whether or not having the force of law and whether or not failure
         to comply therewith would be unlawful so long as compliance therewith is
         standard banking practice in the relevant jurisdiction) (including, without
         limitation, implementing at the national level any Regulatory Change of the
         Basel Accord), the effect of which would be to reduce the return on investment
         of assets or equity in respect of its Commitments or Loans, including, without
         limitation, any such reduction attributable to any funding arrangements
         utilized in connection with the Loans; such compensation shall include,
         without limitation, an amount equal to any reduction of the rate of return on
         assets or equity of such Lender (or any lending office or such bank holding
         company) could have achieved but for such law, regulation, interpretation,
         directive or request.  For purposes of this Section 10(h)(ii), "Basel Accord"
         shall mean the proposals for risk-based capital framework described by the
         Basel Committee on Banking Regulations and Supervisory Practices in its paper
         entitled "International Convergence of Capital Measurement and Capital
         Standards" dated July, 1988, it being understood that, as at the date hereof,
         there has been no Regulatory Change of the Basel Accord (i.e., "Basel II" has
         not been adopted).

(iii)    Any Lender (or the Administrative Agent on its behalf) shall notify the Borrower
         of any event occurring after the date hereof entitling such Lender to compensation
         under paragraph (i) or (ii) of this Section 10(h) as promptly as practicable, but in
         any event within 60 days, after such Lender obtains actual knowledge thereof;
         provided that (A) such Lender shall, with respect to compensation payable
         pursuant to this Section 10(h) in respect of any Additional Costs resulting
         from such event, only be entitled to payment under this Section 10(h) for
         Additional Costs incurred from and after the date that is 60 days prior to the
         date such Lender (or the Administrative Agent on its behalf) does give such
         notice and (B) such Lender will use commercially reasonable efforts (at the
         Borrower's expense) to mitigate the amount of the Additional Costs associated
         with such event, including designating a different lending office for the
         Notes of such Lender affected by such event if such designation will avoid the
         need for, or reduce the amount of, such compensation and will not, in the sole
         opinion of such Lender, result in any economic, legal or regulatory
         disadvantage to such Lender (other than economic disadvantages for which the
         Borrower agrees to indemnify such Lender and which indemnity is acceptable to
         such Lender in its discretion acting reasonably based on its credit assessment
         of the Borrower).  Any such Lender (or the Administrative Agent on its behalf)
         will furnish to the Borrower an officer's certificate setting forth in
         reasonable detail (x) the events giving rise to such Additional Costs, (y) the
         basis for determining and allocating such Additional Costs and (z) the amount
         of each request by such Lender for compensation under paragraph (i) or (ii) of
         this Section 10(h) (subject, however, to any limitations such Lender may
         require in respect of disclosure of confidential information relating to its
         capital structure), together with a statement that the determinations and
         allocations made in respect of the Additional Costs comply with the provisions
         of this Section 10(h), including as provided in the last proviso of this
         paragraph (iii).  Determinations and allocations by any such Lender for
         purposes of this Section 10(h) of the effect of any Regulatory Change pursuant
         to paragraph (i) of this Section 10(h), or of the effect of capital maintained
         pursuant to paragraph (ii) of this Section 10(h), on its costs or rate of
         return of maintaining Notes or its funding, or on amounts receivable by it in
         respect of Notes, and of the amounts required to compensate such Lender under
         this Section 10(h), shall be conclusive absent manifest error, provided that
          such determinations and allocations are made on a reasonable basis and, in the
         case of allocations, are made fairly.

(iv)     If a Lender gives notice of a claim against the Borrower under this Section 10(h),
         the Borrower shall have the right (i) to require such Lender to sell its Notes to
         an institution designated by the Borrower in compliance with Section 24(c)(iii)
         of this Agreement for an amount equal to the outstanding principal amount thereof
         plus accrued interest thereon to the date of sale, together with the Break Amount
         and all other amounts owing thereto, if any, or (ii) to prepay the outstanding
         principal amount of Notes held by such Lender, together with accrued interest
         to the date of such prepayment and Break Amount, if any, and all other amounts
         owing thereto.

(v)      The Borrower shall not be required to make payments under this Section 10(h) to
         any Lender if (A) a claim hereunder arises solely through circumstances peculiar
         to such Lender and which do not affect commercial lenders similar to such Lender
         in the jurisdiction of organization of such Lender generally or (B) the claim arises
         out of a voluntary relocation by such Lender of its lending office (it being
         understood that any such relocation effected pursuant to Section 10(h)(iii)(B)
         is not "voluntary"), or (C) such Lender is required by the Borrower pursuant
         to Section 10(h)(iv) above to sell its Notes to a purchaser designated by the
         Borrower and fails to do so.

(vi)     Amounts payable by the Borrower under this Section 10(h) shall be payable by the
         Borrower within 30 days of demand therefor.

Section 11.       Events Of Default; Certain Rights of Administrative Agent.

(a)      Each of the following events shall constitute an Event of Default (whether any such
event shall be voluntary or involuntary or come about or be effected by operation of law or
pursuant to or in compliance with any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental body):

(i)      The Borrower shall have failed to make a payment of any principal or interest due on
         any Note within two Business Days after the same shall have become due; or

(ii)     The Borrower shall have failed to make any payment of any amount hereunder or under
         the Operative Documents other than principal and interest on the Loan after the same
         shall have become due and such failure shall continue for ten Business Days after
         the Borrower's receipt of written demand therefor by the party entitled
         thereto; or

(iii)    The Borrower shall fail to procure and maintain (or cause to be procured and maintained),
         with respect to the Aircraft, insurance required to be maintained in accordance with the
         provisions of Article VI of the Mortgage or such insurance shall lapse or be
         canceled; or

(iv)     The Borrower shall have failed to perform or observe, or caused to be performed and
         observed, any other covenant or agreement to be performed or observed by it under any
         Operative Document, and such failure shall continue unremedied for a period of
         thirty (30) days after the Borrower's receipt of written notice thereof from
         the Administrative Agent or the Lenders; or

(v)      Any representation or warranty made by the Borrower in any Operative Document or
         any document or certificate furnished by the Borrower in connection therewith or
         pursuant thereto shall prove to have been incorrect in any respect that is materially
         adverse to the Lenders or the Administrative Agent in such party's reasonable
         judgment at the time made and shall remain material; or

(vi)     The commencement by the Borrower of a voluntary case under the federal bankruptcy
         laws, as now constituted or hereafter amended, or any other applicable federal or
         state bankruptcy, insolvency or other similar law in the United States, or the
         consent by the Borrower to the appointment of or taking possession by a
         receiver, liquidator, trustee, custodian, sequestrator (or other similar
         official) of the Borrower or for all or substantially all of its property, or
         the making by the Borrower of any assignment for the benefit of creditors or
         the Borrower shall take any corporate action to authorize any of the foregoing
         or to authorize a general payment moratorium; or

(vii)    The commencement of an involuntary case or other proceeding in respect of the
         Borrower under the federal bankruptcy laws, as now or hereafter constituted, or
         any other applicable federal or state bankruptcy, insolvency or other similar law
         in the United States or seeking the appointment of a receiver, liquidator, custodian,
         trustee, sequestrator (or similar official) of the Borrower or for all or
         substantially all of its property, or seeking the winding-up or liquidation of
         its affairs and the continuation of any such case or other proceeding remains
         undismissed and unstayed for a period of sixty (60) consecutive days, or an
         order, judgment or decree shall be entered in any proceeding by any court of
         competent jurisdiction appointing, without the consent of the Borrower, a
         receiver, trustee or liquidator of the Borrower, or for all or substantially
         all of its property, or sequestering of all or substantially all of the
         property of the Borrower and any such order, judgment or decree or appointment
         or sequestration shall be final or shall remain in force undismissed, unstayed
         or unvacated for a period of sixty (60) consecutive days after the date of
         entry thereof; or

(viii)   The Borrower fails or ceases to be a U.S. Air Carrier or shall have been suspended
         as a U.S. Air Carrier or shall otherwise no longer have all applicable licenses
         (or such licenses shall be suspended) necessary to operate as a commercial airline; or

(ix)     Immediately upon such time as the Mortgage ceases to create a valid, perfected first
         priority mortgage on any Airframe or Engine in favor of the Administrative Agent for
         any reason other than the failure of the Lenders to cause continuation statements to
         be filed to the extent required by the Uniform Commercial Code or the filing by
         or on behalf of the Lenders of a termination statement releasing such Airframe
         or Engine from the Lien of the Mortgage; or

(x)      A "Lease Event of Default" shall have occurred and be continuing under (and as defined
         in) any Related Transactions; or

(xi)     (i) The Borrower shall default in the payment when due of any principal of or
         interest on, or fail to make a scheduled rental payment on, any of its other
         indebtedness or any lease obligation; or (ii) any event specified in any note,
         agreement, indenture, lease or other document evidencing or relating to any
         indebtedness or any lease obligation shall occur, and, after giving effect to any
         applicable notice and/or grace periods, the effect of such default (in the case of
         clause (i)) or event (in the case of clause (ii)) is to cause, or to permit the
         holder or holders of such indebtedness or lease obligation (or a trustee or
         agent on behalf of such holder or holders) to cause, such indebtedness or
         lease obligation to become due or to be terminated, or to be prepaid in full
         (whether by redemption, purchase, offer to purchase or otherwise), prior to
         its stated maturity; provided that, (x) the outstanding amount of such
         indebtedness and (y) the capitalized amount of such lease obligation shall,
         singly or in the aggregate, be in excess of $10,000,000.

(b)      Certain Rights of Administrative Agent.

(i)      In anticipation of receipt from Borrower of payment of sums due and owing hereunder
         or under any Operative Document, the Administrative Agent shall have the option,
         but shall not be obligated to, advance to the Lenders on any Interest Payment Date,
         as provided in Section 10(a) hereof, an amount equal to that required to be paid
         to the Lenders by the Borrower on such Interest Payment Date.

(ii)     The Administrative Agent shall not, as a result of exercising its option to make
         the advance described in Section 11(b)(i) above, obtain any Lien on the Mortgage
         Estate for or on account of costs or expenses incurred in connection with the
         exercise of such right, nor shall any claim of the Administrative Agent against
         the Borrower or any other party for the repayment of such costs or expenses impair
         the prior right and security interest of the Administrative Agent (on behalf of the
         Lenders) in and to the Mortgage Estate.  Upon any advance by the
         Administrative Agent to the Lenders as provided in Section 11(b)(i), the
         Administrative Agent shall be subrogated to the rights of the Lenders in
         respect of any late payment made by Borrower and interest at the Past Due Rate
         payable by the Borrower on account of its being overdue (but shall have no
         rights as a secured party hereunder), and thereafter, the Administrative Agent
         shall be entitled to receive such overdue payment and such interest; provided,
         that the Administrative Agent shall not be entitled to seek recovery of any
         such advance (or any payment in lieu thereof) except pursuant to the foregoing
         right of subrogation.

Section 12.       Remedies.

(a)     General; Acceleration.  (i) If an Event of Default shall have occurred and
         be continuing and so long as the same shall be continuing, then and in every such
         case,  the Administrative Agent may exercise any or all of the rights and powers
         and pursue any and all of the remedies pursuant to this Section 12 and shall have
         and in addition, may exercise all of the rights and remedies of a secured
         party under the Uniform Commercial Code.

(ii)     If an Event of Default referred to in Sections 11(a)(vi) or (vii) shall have occurred,
         then and in every such case (x) the Commitments shall automatically be cancelled and
         (y) the unpaid principal of all Notes then outstanding, together with interest accrued
         but unpaid thereon, and all other amounts due to the Lenders thereunder and
         hereunder and under the other Operative Documents, shall, unless the
         Administrative Agent, acting upon the instructions of the Lenders shall
         otherwise direct, immediately and without further act become due and payable,
         without presentment, demand, protest or notice, all of which are hereby waived.

(iii)    If any other Event of Default shall have occurred and be continuing, then and in
         every such case, the Administrative Agent may at any time, by written notice or
         notices to the Borrower, (x) cancel the Commitments and/or (y) declare all the Notes
         to be due and payable, whereupon the Commitments shall be cancelled and the unpaid
         principal of all Notes then outstanding, together with interest accrued but
         unpaid thereon, and all other amounts due to the Lenders thereunder, hereunder
         and under the other Operative Documents, shall immediately and without further
         act become due and payable without presentment, demand, protest or other
         notice, all of which are hereby waived.

(iv)     If the principal of the Notes shall have become due and payable pursuant to this
         Section 12(a), there shall also become due and payable, to the fullest extent permitted
         by law, to the Lenders upon demand, without presentment, protest or notice, all of
         which are hereby waived, the Break Amount and Additional Costs (if any) therefor.

(v)      The Lenders shall be entitled, at any sale pursuant to this Section 12, to credit
         against any purchase price bid at such sale by the Lenders all or any part of the
         unpaid obligations owing to the Lenders and secured by the Lien of the Mortgage.
         The Administrative Agent and the Lenders shall, upon any such purchase, acquire
         good title to the property so purchased, to the extent permitted by applicable
         law, free of all rights of redemption.

(vi)     The Administrative Agent agrees to give to the Borrower at least ten days' prior
         written revocable notice of any foreclosure of the Lien of the Mortgage, or of any
         other action to cause the Borrower to lose its title in an Aircraft (which period
         of notice the parties hereto confirm is commercially reasonable).

(b)      Repossession and Sale.  At any time during the continuation of an Event of Default,
the Administrative Agent in addition to any rights it might otherwise have at law, may do either
or both of the following:

(i)      Upon the written demand of the Administrative Agent, and at the Borrower's expense,
         cause the Borrower to return promptly, and the Borrower shall return promptly, all
         or any part of any Aircraft as the Administrative Agent may so demand, to the
         Administrative Agent at a major airport on the Borrower's route system in one of
         the forty eight (48) contiguous states of the United States of America chosen by
         the Administrative Agent in the manner and condition required by Section 3.01 of
         the Mortgage, or, alternatively, the Administrative Agent at its option, may,
         to the extent permitted by law, peaceably enter upon the premises where all or
         any part of an Aircraft is located and take immediate possession of and remove
         the same by summary proceedings or otherwise (and, at the Administrative
         Agent's option store the same at the Borrower's premises until disposal
         thereof by the Administrative Agent), all without liability accruing to the
         Administrative Agent for or by reason of such entry or taking of possession or
         removal so long as the Administrative Agent has acted in accordance with the
         provisions of the Mortgage; provided that during any period an Aircraft is
         activated under CRAF in accordance with the provisions of Section 3.03 of the
         Mortgage and in the possession of the government of the United States of
         America or an instrumentality or agency thereof, the Administrative Agent
         shall not, on account of any Event of Default, be entitled to do any of the
         following in such manner as to limit the Borrower's control under the Mortgage
         of the associated Airframe or any Engines installed thereon, unless at least
         sixty (60) days' (or such lesser period as may then be applicable under the
         Military Airlift Command program of the government of the United States of
         America) prior written notice of default hereunder shall have been given by
         the Administrative Agent by registered or certified mail to the Borrower with
         a copy addressed to the Contracting Office Representative for the Military
         Airlift Command of the United States Air Force under the contract with the
         Borrower relating to such Aircraft; or

(ii)     with or without taking possession thereof, sell all or any part of any Aircraft at
         public or private sale, as the Administrative Agent may determine, or otherwise
         dispose of, hold, use, operate or lease to others, as the Administrative Agent,
         in its sole discretion, may determine, all free and clear of any rights of the
         Borrower, except as hereinafter set forth in this Section 12.

                  In addition, the Borrower shall be liable, except as otherwise
provided above and without duplication of amounts payable hereunder, for any and all
reasonable and actual legal fees and other costs and expenses incurred by the
Administrative Agent and the Lenders in connection with the enforcement of any of
their respective rights and remedies hereunder.

                  At any sale of an Aircraft or any part thereof pursuant to this
Section 12, the Administrative Agent on the Lenders' behalf, may bid for and purchase
such property.  The Administrative Agent on the Lenders' behalf, agrees to give the
Borrower at least ten days' written notice of the date fixed for any public sale of
any Airframe or any Engine or of the date on or after which will occur the execution
of any contract providing for any private sale (together with details thereof).
Except as otherwise expressly provided above, no remedy referred to in this Section 12
is intended to be exclusive, but each shall be cumulative and in addition to any other
remedy referred to above or otherwise available to the Administrative Agent at law or
in equity; and the exercise or beginning of exercise by the Administrative Agent of
any one (1) or  more of such remedies shall not preclude the simultaneous or later
exercise by the Administrative Agent of any or all of such other remedies.  No express
or implied waiver by the Administrative Agent of any Event of Default shall in any way
be, or be construed to be, a waiver of any future or subsequent Event of Default.

(c)      Taking of Aircraft.  (i) If an Event of Default shall have occurred and be
         continuing, at the request of the Administrative Agent, the Borrower shall promptly
         execute and deliver to the Administrative Agent such instruments of title and other
         documents as the Administrative Agent may deem necessary or advisable to
         enable the Administrative Agent or an agent or representative designated by
         the Administrative Agent, at such time or times and place or places as the
         Administrative Agent may specify, to obtain possession of all or any part of
         the Mortgage Estate to which the Administrative Agent shall at the time be
         entitled hereunder.  If the Borrower shall for any reason fail to execute and
         deliver such instruments and documents after such request by the
         Administrative Agent, the Administrative Agent may (A) obtain a judgment
         conferring on the Administrative Agent the right to immediate possession and
         requiring the Borrower to execute and deliver such instruments and documents
         to (or as delivered by) the Administrative Agent, to the entry of which
         judgment the Borrower hereby specifically consents, and (B) pursue all or part
         of the Mortgage Estate wherever such Mortgage Estate may be found and may
         peaceably enter any of the premises of the Borrower wherever it may be or be
         supposed to be and search for and take possession of and remove the same.  All
         expenses of obtaining such judgment or of pursuing, searching for and taking
         such property shall, until paid, be secured by the Lien of the Mortgage.

(ii)     Upon every such taking of possession, the Administrative Agent may, from time to
         time, at the expense of the Mortgage Estate, make all such expenditures for
         maintenance, insurance, repairs, replacements, alterations, additions and
         improvements to and of the Mortgage Estate, as it may deem proper.  In each such
         case, the Administrative Agent shall have the right to maintain, use, operate,
         store, lease, control or manage the Mortgage Estate and to carry on the business
         and to exercise all rights and powers of the Borrower relating to the Mortgage Estate,
         as the Administrative Agent shall deem best, including the right to enter into any
         and all such agreements with respect to the maintenance, insurance, use,
         operation, storage, leasing, control, management or disposition of the
         Mortgage Estate or any part thereof as the Administrative Agent may determine;
         and the Administrative Agent shall be entitled to collect and receive directly
         all tolls, rents, revenues, issues, income, products and profits of the
         Mortgage Estate and every part thereof.  Such tolls, rents, revenues, issues,
         income, products and profits shall be applied to pay the expenses of the use,
         operation, storage, leasing, control, management or disposition of the
         Mortgage Estate and of conducting the business thereof, and of all
         maintenance, repairs, replacements, alterations, additions and improvements,
         and to make all payments which the Administrative Agent may be required or may
         elect to make, if any, for taxes, assessments, insurance or other proper
         charges upon the Mortgage Estate or any part thereof (including the employment
         of engineers and accountants to examine, inspect and make reports upon the
         properties and books and records of the Borrower), and all other payments
         which the Administrative Agent may be required or authorized to make under any
         provision of the Mortgage, as well as just and reasonable compensation for the
         services of the Administrative Agent pursuant to this Section 9.03(b), and of
         all persons properly engaged and employed by the Administrative Agent.

(d)      Discontinuance of Proceedings.  In case the Administrative Agent (on its
own behalf, or on behalf of the Lenders) shall have instituted any proceeding to enforce
any right, power or remedy under the Mortgage by foreclosure, entry or otherwise, and such
proceedings shall have been discontinued or abandoned for any reason or shall have been
determined adversely to the Administrative Agent, then and in every such case, the
Administrative Agent and the Borrower shall, subject to any determination in such proceedings,
be restored to their former positions and rights hereunder with respect to the Mortgage Estate,
and all rights, remedies and powers of the Administrative Agent shall continue as if no
such proceedings had been instituted.

(e)      Waiver of Past Dekfaults.  The Administrative Agent, upon written instructions
from the Majority Lenders, shall waive any past Default or Event of Default hereunder and its
consequences and upon any such waiver such Default or Event of Default shall cease to exist
and any Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Agreement, but no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any right consequent thereon.

(f)      Remedies Cumulative.  Each and every right, power and remedy given to the
Administrative Agent or the Lenders specifically or otherwise herein shall be cumulative and
shall be in addition to every other right, power and remedy herein specifically given or now
or hereafter existing at law, in equity or by statute, and each and every right, power and
remedy whether specifically herein given or otherwise existing may be exercised from time to
time and as often and in such order as may be deemed expedient by the Administrative
Agent or the Lenders and the exercise or the beginning of the exercise of any power or
remedy shall not be construed to be a waiver of the right to exercise at the same time
or thereafter any other right, power or remedy.  No delay or omission by the
Administrative Agent or the Lenders in the exercise of any right, remedy or power or
in the pursuit of any remedy shall impair any such right, power or remedy or be
construed to be a waiver of any default on the part of the Borrower or to be an
acquiescence therein.

(g)      Payment After Event of Default, etc.  All payments received and amounts held
or realized by the Administrative Agent after an Event of Default shall have occurred and
so long as such Event of Default shall be continuing, and after the Notes shall have been
accelerated pursuant to Section 12(a) hereof or after the Lenders or the Administrative
Agent shall foreclose or enforce the Mortgage or after the Notes shall have become due and
payable as provided in Section 12(a)(ii) or (iii), as well as all payments or amounts
then held by the Administrative Agent as part of the Mortgage Estate, shall be
promptly distributed by the Administrative Agent in the following order of priority:

                  first, so much of such payments or amounts as shall be required to
         reimburse the Administrative Agent for any tax, expense, charge or other loss
         (including, without limitation, all amounts to be expended at the expense of,
         or charged upon the tolls, rents, revenues, issues, income, products and
         profits of, the property included in the Mortgage Estate pursuant to
         Section 12(c)(ii)) incurred by the Administrative Agent (to the extent not
         previously reimbursed) (including, without limitation, the expenses of any
         sale, taking or other proceeding, reasonable attorneys' fees and expenses,
         court costs, and any other expenditures incurred or expenditures or advances
         made by the Administrative Agent, in the protection, exercise or enforcement
         of any right, power or remedy or any damages sustained by the Administrative
         Agent, liquidated or otherwise, upon such Event of Default) shall be applied
         by the Administrative Agent in reimbursement of such expenses;

                  second, so much of such payments or amounts remaining as shall be
          required to pay in full to the Lenders all amounts payable thereto pursuant to
         any other Operative Document and secured hereunder (other than amounts payable
         pursuant to clause "third" of this Section 12(g)) to the Lenders and remaining
         unpaid, including Break Amount and Additional Costs, shall be distributed to
         such Persons, and if the aggregate amount remaining shall be insufficient to
         pay all such amounts in full, it shall be distributed ratably, without
         priority of such person over any other;

                  third, so much of such payments or amounts remaining as shall be
         required to pay in full the aggregate unpaid principal amount of and all
         accrued but unpaid interest to the date of distribution on, the Notes shall be
         distributed to the Lenders, and if the aggregate amount remaining shall be
         insufficient to pay all such amounts in full, it shall be distributed ratably,
         without priority of any such person over any other, in the proportion that the
         principal amount of and all accrued but unpaid interest to the date of
         distribution on, each Note bears to the aggregate principal amount of and all
         accrued but unpaid interest to the date of distribution on all Notes; and

                  fourth, the balance, if any, of such payments or amount remaining
         thereafter shall be distributed to the Borrower or as a court of competent
         jurisdiction shall direct.

Section 13.       Replacement Engines.

(a)      Replacement Engines.  At any time and from time to time, any Engine which
has been (or is to be treated as if the same had been) subject to an Event of Loss and may
be replaced under Section 5.02 of the Mortgage by a Replacement Engine shall be replaced
in accordance with the provisions of this Section 13(a) and the Borrower shall, from time
to time, direct the Administrative Agent to execute and deliver to or as directed in writing
by an appropriate instrument releasing such Engine from the Lien of the Mortgage, the
Administrative Agent on behalf of the Lenders shall execute and deliver such
instrument as aforesaid, but only upon receipt by or deposit with the Administrative
Agent of the following:

(i)      A written request from the Borrower, requesting such release and specifically
         describing the Engine(s) so to be released.

(ii)     A certificate signed by a duly authorized officer of the Borrower stating the
         following with respect to the replacement of any Engine:

(A)      the fair market value of the Replacement Engine as of the date of such certificate
                  (which value shall not be less than the then fair market value of the
                  Engine requested to be released, assuming such Engine was in the condition
                  and repair required to be maintained (but without regard to hours and
                  cycles until overhaul));

(B)      the fair market value of the Engine to be released (immediately prior to the date
                  such Engine suffered an Event of Loss);

(C)      that the release of the Engine so to be released will not impair the security of
                  the Mortgage or be in contravention of any of the provisions of the
                  Mortgage;

(D)      that each of the conditions specified in Section 5.02 of the Mortgage with respect
                  to such Replacement Engine have been satisfied; and

(E)      that the Replacement Engine was first placed in service after October 22, 1994.

(b)      Mortgage Supplements for Replacements.  In the event of a Replacement Engine
being substituted as contemplated by Section 5.02 of the Mortgage, the Borrower and the
Administrative Agent agree for the benefit of the Lenders, subject to fulfillment of the
conditions precedent and compliance by the Borrower with its obligations set forth in
Section 5.02 of the Mortgage and the requirements of Section 13(a) with respect to such
Replacement Engine, to execute and deliver a Mortgage Supplement with respect thereto
as contemplated by Section 5.02 of the Mortgage, and, provided no Default or Event of
Default in each case under Section 11 hereof shall have occurred and be continuing, to
execute and deliver to the Borrower an appropriate instrument releasing the Engine
being replaced from the Lien of the Mortgage (which may be the Mortgage Supplement
that adds the Replacement Engine to the Mortgage).

(c)      Effect of Replacement.  In the event of the substitution of a Replacement
Engine pursuant to Section 5.02 of the Mortgage and Section 13(a) hereof, all provisions
of this Agreement and the Mortgage relating to an Engine or Engines being replaced shall
be applicable to such Replacement Engine or Engines with the same force and effect as if
such Replacement Engine or Engines were the same engine or engines as the Engine or Engines
being replaced but for the Event of Loss with respect to an Engine or Engines being
replaced.

Section 14.       The Administrative Agent.

(a)      Appointment, Powers and Immunities.  Each Lender hereby appoints and authorizes
Hamburgische Landesbank-Girozentrale- ("HLB") to act as its Administrative Agent
hereunder and under the other Operative Documents with such powers as are specifically
delegated to the Administrative Agent by the terms of this Agreement and of the other
Operative Documents, together with such other powers as are reasonably incidental thereto.
The Administrative Agent shall take all actions delegated to it hereunder as an agent
solely for the benefit of the Lenders.  The Administrative Agent (which term as used
in this sentence and in Section 14(c) and the first sentence of Section 14(f) hereof
shall include reference to its Affiliates and its own and their Affiliates' officers,
directors, employees and agents, or either of them):  (i) shall have no duties or
responsibilities except those expressly set forth in this Agreement and in the other
Operative Documents, and shall not by reason of this Agreement or any other Operative
Document be a trustee for the Lenders; (ii) shall not be responsible to the Lenders
for any recitals, statements, representations or warranties contained in this
Agreement or in any other Operative Document, or in any certificate or other document
referred to or provided for in, or received by any of them under, this Agreement or
any other Operative Document, or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement, any Note or any other Operative
Document or any other document referred to or provided for herein or therein or for
any failure by the Borrower or any other Person to perform any of its obligations
hereunder or thereunder; (iii) shall not be required to initiate or conduct any
litigation or collection proceedings hereunder or under any other Operative Document;
(iv) shall not be responsible to the Lenders for any action taken or omitted to be
taken by it hereunder or under any other Operative Document or under any other
document or instrument referred to or provided for herein or therein or in connection
herewith or therewith, except for its own gross negligence or willful misconduct; and
(v) may be removed from its role as Administrative Agent by the Lenders with or
without cause and upon notice by Lenders to the Borrower.  The Administrative Agent
shall not assign its interest to any replacement agent who is not a bank or financial
institution with a net worth (or capital and surplus, as the case may be) in excess of
$500,000,000 without the Borrower's prior written consent, such consent not to be
unreasonably withheld.  The Administrative Agent may employ agents and
attorneys-in-fact and shall not be responsible for the negligence or misconduct of any
such agents or attorneys-in-fact selected by it in good faith.

(b)      Reliance by the Administrative Agent.  The Administrative Agent shall be entitled
to rely upon any certification, notice or other communication (including, without limitation,
any thereof by telephone, telecopy, telex, telegram or cable) believed by it to be genuine
and correct and to have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel, independent accountants and
other experts selected by the Administrative Agent.  As to any matters not expressly
provided for herein or in any other Operative Document, the Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, hereunder or
thereunder in accordance with instructions given by each Lender as is required in such
circumstance, and such instructions of such Lender and any action taken or failure to
act pursuant thereto shall be binding on all of the Lenders.

(c)      Defaults.  The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of a Default (other than the non-payment of principal of or interest
on Notes) unless the Administrative Agent have received notice from the Lenders or the Borrower
specifying such Default and stating that such notice is a "Notice of Default".  In the event
that the Administrative Agent receives such a notice of the occurrence of a Default, the
Administrative Agent shall give prompt notice thereof to the Lenders (and shall give
the Lenders prompt notice of each such non-payment).  The Administrative Agent shall
(subject to Section 16(a) hereof) take such action with respect to such Default as
shall be directed by the Majority Lenders, provided that, unless and until the
Administrative Agent shall have received such directions, the Administrative Agent may
(but shall not be obligated to) take such action, or refrain from taking such action,
with respect to such Default as it shall deem advisable in the best interest of the
Lenders except to the extent that this Agreement expressly requires that such action
be taken, or not be taken, only with the consent or upon the authorization of the
Majority Lenders.

(d)      Rights as Administrative Agent.  HLB (and any successor acting as Administrative
Agent) and its affiliates may (without having to account therefor to the Lenders) accept
deposits from, lend money to, make investments in and generally engage in any kind of loan,
trust or other business with the Borrower (and any of its subsidiaries or Affiliates)
as if it were not acting as the Administrative Agent, and HLB and its affiliates may
accept fees and other consideration from the Borrower for services in connection with
this Agreement or otherwise without having to account for the same to the Lenders.

(e)      Failure to Act.  Except for action expressly required of the Administrative Agent
hereunder and under the other Operative Documents, the Administrative Agent shall in all
cases be fully justified in failing or refusing to act hereunder and thereunder unless it
shall receive indemnification against any and all liability and expense that may be incurred
by it by reason of taking or continuing to take any such action.

(f)      Resignation or Removal of the Administrative Agent.  Subject to the appointment
and acceptance of a successor Administrative Agent as provided below, and subject further
to the penultimate sentence of this Section 14(f), the Administrative Agent may resign at
any time by giving notice thereof to the Lenders and the Borrower, and the Administrative
Agent may be removed at any time with or without cause by the Majority Lenders.  Upon
any such resignation or removal, the Majority Lenders shall have the right to appoint
a successor Administrative Agent.  If no successor Administrative Agent shall have
been so appointed by the Majority Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent's giving of notice of
resignation or the Lenders' removal of the retiring Administrative Agent, then the
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent.  Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative Agent or
shall thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations hereunder.  After any retiring
Administrative Agent's resignation or removal hereunder as Administrative Agent, the
provisions of this Section 14 shall continue in effect for its benefit in respect of
any actions taken or omitted to be taken by it while it was acting as the
Administrative Agent.  The Administrative Agent shall not assign its interest to any
replacement agent who is not a bank or financial institution with a net worth (or
capital and surplus, as the case may be) in excess of $500,000,000 without the
Borrower's prior written consent, such consent not to be unreasonably withheld.

(g)      Consents under Operative Documents.  Except as otherwise provided in Section 16(a)
hereof, the Administrative Agent may, with the prior consent of the Majority Lenders (but
not otherwise), consent to any modification, supplement or waiver under any of the
Operative Documents, provided that, without the prior consent of each Lender, the
Administrative Agent shall not (except as provided herein) release any collateral or
otherwise terminate any Lien under any Operative Document providing for collateral
security, or agree to additional obligations being secured by such collateral security
(unless the Lien for such additional obligations shall be junior to the Lien in favor
of the other obligations secured by such Operative Document), except that no such
consent shall be required, and the Administrative Agent is hereby authorized, to
release any Lien covering property which is the subject of a disposition of property
permitted hereunder or to which the Lenders have consented.

(h)      Non-Receipt of Funds by the Administrative Agent.  Unless the Administrative Agent
shall have been notified by the Lenders or the Borrower (the "Payor") prior to the date on
which the Payor is to make payment to the Administrative Agent of (in the case of the
Lenders) the proceeds of a Loan to be made by it hereunder or (in the case of the Borrower)
a payment to the Administrative Agent for account of one or more of the Lenders
hereunder (such payment being herein called the "Required Payment"), which notice
shall be effective upon receipt, that the Payor does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that the
Required Payment has been made and may, in reliance upon such assumption (but shall
not be required to), make the amount thereof available to the intended recipient(s) on
such date and, if the Payor has not in fact made the Required Payment to the
Administrative Agent, the recipient(s) of such payment shall, on demand, repay to the
Administrative Agent the amount so made available together with interest thereon in
respect of each day during the period commencing on the date such amount was so made
available by the Administrative Agent until the date the Administrative Agent recovers
such amount at a rate per annum equal to the Federal Funds Rate for such day and, if
such recipient(s) shall fail promptly to make such payment, the Administrative Agent
shall be entitled to recover such amount, from the Payor, together with interest as
aforesaid.

Section 15.       Investment Of Funds.  Any moneys held by the Administrative Agent as security
hereunder for Borrower's obligations shall, until paid to Borrower or otherwise applied in
accordance with the terms of the Operative Documents, be invested by the
Administrative Agent as Borrower may from time-to-time direct in writing (or orally
and confirmed in writing), but subject to availability at the Administrative Agent's
discretion (it being understood that absent such a direction, there shall be no
obligation to invest such moneys) in (a) obligations of, or guaranteed by, the United
States Government or agencies thereof, (b) open market commercial paper of any
corporation incorporated under the laws of the United States of America or any State
thereof rated at least "P-2" or its equivalent by Moody's or at least "A-2" or its
equivalent by S&P, (c) certificates of deposit issued by commercial banks organized
under the laws of the United States or of any political subdivision thereof having a
combined capital and surplus in excess of $750,000,000 which banks or their holding
companies have a rating of A or its equivalent by Moody's or S&P; provided, however,
that the aggregate amount at any one time so invested in certificates of deposit
issued by any one bank shall not exceed five percent (5%) of such bank's capital and
surplus, (d) Dollar denominated offshore certificates of deposit issued by, or
offshore time deposits with, any commercial bank described in (c) or any subsidiary
thereof, and (e) repurchase agreements with any financial institution having combined
capital and surplus of at least $750,000,000 with any of the obligations described in
clauses (a) through (d) as collateral, none of which investments (but exclusive of any
underlying investment that may be subject to a repo) shall have a term to maturity in
excess of 30 days.  There shall be promptly remitted to Borrower or its order (but no
more frequently than monthly) any gain (including interest received) realized as a
result of any such investment (net or any, fees, commissions and other expenses, if
any, incurred in connection with such investment) unless a Special Default or an Event
of Default shall have occurred and be continuing.  The Borrower shall be responsible
for any net loss realized as a result of any such investment and shall reimburse the
Administrative Agent on demand.

Section 16.       Supplements and Amendments to the Mortgage and Other Operative Documents

(a)      Instructions of Lenders; Limitations.  (i) At any time and from time to time, at the
request of the Borrower the Administrative Agent (but only on the written direction or
consent of the Majority Lenders) shall execute a supplement to the Mortgage for the purpose
of adding provisions to, or changing or eliminating provisions of, the Mortgage as specified
in such request, provided, however, that, without the consent of each Lender, no such
amendment of or supplement to any such document, or waiver or modification of the
terms of any thereof, shall (i) modify any of the provisions of this Section 16(a) or
the definitions of the terms, "Majority Lenders" or "Operative Documents", contained
herein or in any other Operative Document, (ii) increase the principal amount of any
Note or reduce the amount or extend the time of payment of any amount owing or payable
under any Note or (except as provided in this Agreement) increase or reduce the Break
Amount or interest payable on any Note (except that only the consent of the Lender
holding any Note shall be required for any decrease in any amounts of or the rate of
Break Amount or interest payable on such Note or any extension for the time of payment
of any amount payable under such Note), (iii) reduce, modify or amend any indemnities
in favor of any Lender or in favor of or to be paid by the Borrower or alter the
definition of "Indemnitee" to exclude any Lender (except as consented to by each
Person adversely affected thereby), or (iv) release the Borrower from its obligations
in respect of the payment of the principal and interest then outstanding (or other
amounts payable therewith) or change any of the circumstances under which Stipulated
Insured Amount (or other amounts payable therewith) are payable.  This Section 16(a)
shall not apply to any mortgage or mortgages supplemental hereto permitted by, and
complying with the terms of, Section 13(b).  Notwithstanding the foregoing, without
the consent of each Lender, no such supplement to the Mortgage, or waiver or
modification of the terms thereof or of any other agreement or document shall
expressly permit the creation of any Lien on the Mortgage Estate or any part thereof,
except as therein expressly permitted, or deprive any Lender of the benefit of the
Lien of the Mortgage on the Mortgage Estate, except as provided in Sections 13(a) and
13(b) hereof or in connection with the exercise of remedies under Section 12 hereof.
Except as provided in this Section 16(a), the Administrative Agent shall not amend,
supplement or waive any of the terms of the Mortgage or this Agreement.

(b)      Administrative Agent Protected.  If, in the opinion of the institution acting as
the Administrative Agent hereunder any document required to be executed pursuant to the
terms of Section 16(a) affects any right, duty, immunity or indemnity with respect to it
under the Mortgage, the Administrative Agent may in its discretion decline to execute such
document.

(c)      Documents Mailed to the Lenders.  Promptly after the execution by the Administrative
Agent and the Lenders of any document entered into pursuant to Section 16(a), the Administrative
Agent shall mail, by certified mail, postage prepaid, a conformed copy thereof to each
Lender at its address shown on the Note Register, but the failure of the Borrower or
the Administrative Agent, to mail such conformed copies shall not impair or affect the
validity of such document.

Section 17.       Notices.

         All notices, demands, instructions and other communications required or
permitted to be given to or made upon any party hereto shall be in writing and shall
be personally delivered or sent by registered or certified mail, postage prepaid, or
by facsimile, or by prepaid courier service, and shall be effective upon receipt.

         Unless otherwise specified in a notice sent or delivered in accordance with
the foregoing provisions of this Section 17, notices, demands, instructions and other
communications in writing shall be given to or made upon the respective parties hereto
at their respective addresses (or to their respective telex address or facsimile
numbers) as follows:  (a) if to the Borrower or the Administrative Agent, to the
respective addresses set forth in Section 7.06 of the Mortgage, (b) if to the Lenders,
to the respective addresses set forth on Schedule I hereto, or (c) if to any
subsequent lender, addressed to such lender its address set forth in the Note Register
maintained pursuant hereto.

         Notwithstanding anything to the contrary contained herein or in any of the
Operative Documents, and for the avoidance of doubt, any notice required to be given
by the Lenders hereunder or under any of the Operative Documents may also be given by
the Administrative Agent on the Lenders' behalf.  The Administrative Agent agrees to
give any notice so received to the Lenders.

Section 18.       Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.

(a)      This Agreement shall in all respects be governed by, and construed in accordance with,
the law of the State of New York, including all matters of construction, validity and performance.

(b)      Each party hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of the Supreme Court of the State of New York
sitting in New York County and of the United States District Court of the Southern District
of New York, and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such Federal
court.  Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law.  Nothing in this Agreement shall
affect any right that any party may otherwise have to bring any action or proceeding
relating to this Agreement against another party or its properties in the courts of
any jurisdiction.

(c)      Each party hereby irrevocably and unconditionally waives, to the fullest extent it
may legally and effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to this Agreement
in any court referred to in paragraph (b) of this Section.  Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such court.

(d)      Each party to this Agreement irrevocably consents to service of process in the
manner provided for notices in Section 17.  Nothing in this Agreement will affect the right
of any party to this Agreement to serve process in any other manner permitted by law.

(e)      EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, ADMINISTRATIVE AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

Section 19.       Costs and Expenses.  The Borrower shall reimburse the Administrative
Agent for all reasonable out-of-pocket expenses incurred by it in connection with the
negotiation and preparation of this Agreement and the other Operative Documents (including
the reasonable fees and expenses of its special counsel); provided that, if a Delivery
Date fails to occur due to the fault of the Administrative Agent or any Lender
(including the failure to obtain any necessary credit approval), the Administrative
Agent will be responsible for its own costs and expenses (including legal fees and
expenses); which costs and expenses shall be limited, in the case of the failure of
the second Delivery Date to occur, to the costs and expenses incurred solely in
connection with such second Delivery Date.  The Borrower is also liable for all of its
own out-of-pocket expenses incurred in connection with the negotiation, preparation
and the carrying out of its obligations under this Agreement and the other Operative
Documents (including the reasonable fees and expenses of all of its special counsel).

Section 20.       Section 1110 Compliance.

         Notwithstanding any provision herein or elsewhere contained to the contrary,
it is understood and agreed among the parties hereto that the transactions
contemplated by this Credit Agreement, and the other Operative Documents are expressly
intended to be, shall be and should be construed so as to be, entitled to the full
benefits of 11 U.S.C. Section 1110, as amended from time to time, and any successor
provision thereto.

Section 21.       Confidentiality.

         Except to the extent otherwise required by applicable law or, as required to
be filed publicly with the Securities and Exchange Commission, or unless the Borrower,
the Lenders and the Administrative Agent shall otherwise consent in writing, each
party to this Agreement agrees to maintain the confidentiality of this Agreement (and
all drafts hereof and documents ancillary hereto) in its communications with third
parties other than any Indemnified Party and not to disclose, deliver or otherwise
make available to any third party (other than its directors, officers, employees,
rating agencies, accountants or counsel or to bank examiners or other regulatory
personnel) the original or any copy of all or any part of this Agreement (or any draft
hereof and documents ancillary hereto) except to an Indemnified Party.

         None of the Borrower, the Administrative Agent, or any of their respective
Affiliates shall issue any news release or make any public announcement pertaining to
the transactions contemplated by this Agreement and the Operative Documents without
the prior written consent of the other (which consent shall not be unreasonably
withheld) unless such news release or public announcement is required by applicable
law, in which case the parties shall consult with each other prior to the issuance of
such news release or public announcement.

         Notwithstanding anything herein, there is no restriction (either express or
implied) on any disclosure or dissemination of the tax structure or tax aspects of the
transaction contemplated by the Operative Documents.  Furthermore, each party hereto
acknowledges that it has no proprietary rights to any tax matters or tax idea
contemplated by the Operative Documents or to any element of the transaction structure
contemplated by the Operative Documents.

Section 22.       Covenants of the Administrative Agent and the Lenders.

(a)      Quiet Enjoyment.  The Administrative Agent and each Lender each agrees that neither
it nor any of its Affiliates, nor anyone acting on behalf of any such Person will interfere
in the Borrower's quiet enjoyment of the Aircraft so long as no Event of Default shall have
occurred and be continuing.

(b)      Lender Liens.  The Administrative Agent and each Lender hereby severally covenants
and agrees with each of the other parties hereto that so long as (i) it remains the
Administrative Agent or a Lender, as the case may be, and (ii) the Lien of the Mortgage on
any Aircraft has not been released in accordance with the terms of the Operative Documents,
it will (X) take such action as may be necessary to discharge any Lender Liens, if any, on
any Aircraft attributable to it or any of its Affiliates and (Y) indemnify and hold
harmless the other parties hereto from and against any loss, cost or expense which may
be suffered or incurred by any such Person as a result of its failure to discharge and
satisfy any such Lender Lien.

(c)      Transfer Restrictions.  Each Lender covenants that (notwithstanding anything
herein or in any other Operative Document to the contrary) it will not transfer its Notes
or any interest under any of the Operative Documents unless the transferee makes the
representation and warranty contained in Section 7(b).

Section 23.       Leveraged Lease Financing.  Notwithstanding any provision herein or
elsewhere in the Operative Documents to the contrary notwithstanding, the Borrower may elect,
prior to the borrowing for either Aircraft contemplated by Section 2(a) hereof, to finance
Aircraft 1743 and/or Aircraft TBD as a leveraged lease financing and the Lenders agree to
such utilization of their Commitments for such purpose, subject to the satisfaction of the
following terms and conditions:

(a)      the Borrower shall provide at least 30 days' advance notice of its intention to effect
such a financing, which notice shall identify the equity investor (the "Owner Participant")
and owner trustee ("Lessor");

(b)      the identified Owner Participant shall have a tangible net worth of at least
$50,000,000 (or have its obligations guaranteed by a parent corporation with such a tangible
net worth level), shall be an active participant in the aircraft leveraged lease industry
and the identity of which (as well as that of the Lessor) shall be reasonably satisfactory
to the Lenders;

(c)      documentation for such transaction shall be in form and substance satisfactory to
         the Lenders and shall:

(i)      contain terms and conditions concerning the Borrower and the Aircraft no less
         favorable to the Lenders than those binding on the Borrower contained in the
         Operative Documents (provided that the lease in any such leveraged lease transaction
         need not cross default to (i) the Mortgage or (ii) if both Aircraft shall be financed
         by leveraged leases, to the lease for the other Aircraft unless the Owner
         Participant for both Aircraft are the same and the Owner Participant has,
         after reasonable efforts undertaken by the Borrower to achieve such result,
         agreed to the same); and

(ii)     contain debt/equity provisions as are consistent with market practice and reasonably
         satisfactory to the Lenders, but shall not, without the consent of the Lenders,
         contain any swap breakage cap or other limitation relating to any swap hedging
         transaction or the ability of the Lenders to recover any swap hedging transaction
         or the ability of the Lenders to recover any swap breakage losses ahead of recoveries
         by the Owner Participant of its investment;

(d)      the economic substance (e.g., loan amount, interest rate, payment periodicity,
maturity date, amortization profile and LIBOR) of the leveraged lease debt funded by the
Lenders shall be the same as that evidenced by the Notes under the Mortgage; provided that


(i)      the level of indebtedness may be reduced in part; and

(ii)     the amortization profile on the leveraged lease debt may be based on an optimized
         leveraged lease basis so long as (x) the final maturity is no later than 12 years
         following the Delivery Date of such Aircraft, (y) the average life of such debt
         does not exceed 8 years (computed as of such Delivery Date) and (z) such amortization
         profile shall otherwise be mutually agreed by the Borrower and the Lenders on
         a good faith basis; and

(e)      the Borrower shall pay to the Lenders (i) the reasonable fees and expenses of their
special counsel in connection with the negotiation, drafting (by such special counsel of
the related indenture), execution and delivery of the documentation utilized to effect
such leveraged lease and (ii) any reasonable out-of-pocket (including travel) costs and
expenses of the Administrative Agent as a single representative for all of the Lenders
incurred in connection with the leveraged lease.

Section 24.       Miscellaneous.

(a)      The representations, warranties, indemnities and agreements of the Borrower, the
Administrative Agent and the Lenders and each party's obligations under any and all thereof,
shall survive the expiration or other termination of this Agreement or any other Operative
Document, except as expressly provided herein or therein.

(b)      This Agreement may be executed by the parties hereto in separate counterparts,
each of which when so executed and delivered shall be an original, but all such counterparts
shall together constitute but one and the same instrument.  Neither this Agreement nor any
of the terms hereof may be terminated, amended, supplemented, waived or modified, except by
an instrument in writing signed by the party or parties thereto.

(c)      (i) This Agreement shall be binding upon and shall inure to the benefit of, and
         shall be enforceable by, the parties hereto and their respective successors
         and permitted assigns.

(ii)     The Borrower may not assign any of its rights or obligations under this Agreement
         or the other Operative Documents except to the extent expressly provided thereby.

(iii)    Subject to the provisions of clause (iv) below, any Lender may assign its Notes,
         in whole or in part, as provided hereunder and in Section 10(c) hereof, to any
         Person (including an Affiliate, another lender or other third party) which
         assignment shall be effected pursuant to an agreement substantially in the form
         of Exhibit B hereto.  In addition, any Lender may, with the prior written consent
         of the Borrower, assign, in whole or in part, its Commitment in respect of any
         Aircraft to any other Person capable of meeting its funding obligation in
         respect of the assigned Commitment, which assignment shall be effected
         pursuant to an agreement substantially in the form of Exhibit B hereto,
         appropriately modified to relate to the assignment of a Commitment.  Effective
         upon the assignment of any Commitment in accordance with this Section 24(c),
         such Lender shall be relieved of its obligations in respect of such Commitment
         to the extent the assignee thereof shall have become obligated in respect
         thereof.

(iv)     Any assignment or transfer by such Lender hereunder shall be subject to the following
         conditions:

(A)      The transferring Lender shall have first obtained the prior written consent of the
                  Borrower, which consent shall not be unreasonably withheld (provided that
                  no such consent shall be required if an Event of Default has occurred and
                  is continuing);

(B)      The transferring Lender shall send the Borrower a written notice of such proposed
                  transfer, setting forth the name and address of the proposed transferee,
                  the amount of the transferring Lender's Notes proposed to be transferred
                  and the proposed date on which such transfer will occur.  the Borrower
                  will then have three (3) Business Days to request such additional
                  information as it may reasonably require regarding such proposed
                  transferee, or , if no such additional information is requested and
                  such proposed transfer satisfies the other requirements of this
                  Section 24(c), the Borrower shall be deemed to have consented to such
                  proposed transfer.  In the event that the Borrower requests
                  additional information, it shall have three (3) Business Days from
                  the time such additional information is provided to reject such
                  proposed transfer, failing which, subject to satisfaction of the
                  other requirements of this Section 24(c), the Borrower shall be
                  deemed to have given its consent;

(C)      as a result of any assignment or transfer, there shall be no more than five (5)
                  lenders in the aggregate;

(D)      no such assignment or transfer shall be in an amount less than $5,000,000;

(E)      so long as no Event of Default shall have occurred or be continuing, no assignment
                  or transfer shall, at the time of such assignment or transfer, increase
                  the obligations (including, without limitation, in respect of withholding
                  taxes or increased costs) of the Borrower under this Agreement or the
                  Mortgage; and

(F)      except as otherwise set forth herein, no participant in any Loan assigned or
                  transferred hereunder shall have any rights directly against the Borrower.

                  In the event a Lender, in accordance with this Section 24(c), assigns
its interest in any Loan, together with its interest herein and in  the other
Operative Documents, in each case to the extent relating to such Loan, then all
references to "the Lender" hereunder shall mean and refer to such assignee to the
extent of such assignment, and any subsequent assignment by such assignee shall have a
corresponding effect.

                  Subject always to the foregoing, this Agreement inures to the benefit
of, and is binding upon, the successors and assigns of the parties hereto.

(v)      Notwithstanding the foregoing, the Administrative Agent may not assign or transfer
         its rights or obligations hereunder or under the other Operative Documents without
         the prior written consent of the Lenders, such consent not to be unreasonably
         withheld.

(vi)     All costs and expenses in connection with any assignment or transfer permitted by
         this Section 24(c) (including any legal fees of counsel to the parties to the
         Operative Documents) shall be borne by the relevant transferring/assigning lender,
         except in the case of an assignment or transfer that is effected at the
         request of the Borrower or if an Event of Default shall have occurred and be
         continuing, in which case such costs and expenses (including reasonable legal
         fees) shall be borne by the Borrower.

(d)      No Lender shall have any obligation or duty to the Borrower, or to other Persons
with respect to the transactions contemplated hereby except those obligations or duties of
such Lender expressly set forth in this Agreement and the other Operative Documents, and
no Lender shall be liable for performance by any other party hereto of such other party's
obligations or duties hereunder.  Without limitation of the generality of the
foregoing, under no circumstances whatsoever shall any Lender be liable to the
Borrower for any action or inaction on the part of the Administrative Agent in
connection with the transactions contemplated herein, whether or not such action or
inaction is caused by willful misconduct or gross negligence of the Administrative
Agent.

Section 25.       Terms of Fixed Rate Setting.

(a)      The Lenders, at the Borrower's direction, shall cause the Applicable Rate for
each Loan to be a fixed rate effective for the period commencing on a date selected by
Borrower during the term of the Notes (the "Swap Effective Date") and ending on the final
scheduled maturity date of the Notes issued in respect of such Loan (the "Swap Period").

(b)      If the Borrower desires to elect a Fixed Rate, it shall give the Lenders at least
five Business Days' advance notice of such intention. By 9:30 a.m. (New York City time) on
the date three Business Days prior to the Swap Effective Date, if the Borrower desires the
Applicable Rate to become a Fixed Rate, each Lender shall quote to the Borrower the fixed
rate of interest at which such Lender would be willing to lend to the Borrower.  No later
than two minutes after receipt of such quotation, the Borrower shall inform each Lender
whether it accepts or rejects such fixed rate quotation.  If such fixed rate quotation
is accepted, such quoted fixed rate (the "Fixed Rate") shall be the Applicable Rate
hereunder. Each Lender agrees to provide its quotation of a Fixed Rate in accordance
with market practice based upon the Notional Swap Transaction and as though such
Lender were the floating rate payor thereunder.

(c)      In the event the Applicable Rate is the Fixed Rate, on the date of (i) any
prepayment of the Notes pursuant to the Mortgage or (ii) any acceleration of the Notes
pursuant to the Mortgage, each Lender will provide a quotation, as it reasonably determines
in good faith in accordance with market practice, representing the termination value of
the Notional Swap Transaction  by 12:00 noon New York City time on such date (the
"Termination Date").

(d)      Each Lender agrees that, so long as no Special Default or Event of Default shall
have occurred and be continuing, it shall, promptly pay to the Borrower at such account as
the Borrower may specify any Swap Breakage Gain in respect of the Notes, except that it
may first deduct therefrom any amounts then due to it (or, if acting as a swap agent, any
Lender) under the Operative Documents and apply any amount so retained to the
satisfaction thereof.  At such time as there shall not be continuing any such Special
Default or Event of Default, such amount shall be paid to the Borrower.

(e)      Upon the request of the Borrower, each Lender shall provide to the Borrower a
good faith estimate of the Swap Breakage Loss or Swap Breakage Gain, as the case may be,
related to the Notes, in connection with the occurrence, or anticipated occurrence, of any
event contemplated by the Operative Documents that might give rise to an obligation to pay
Swap Breakage Loss or Swap Breakage Gain.

(f)      Upon determination by a Lender of any Swap Breakage Loss or Swap Breakage Gain
payable to or by it, as the case may be, such Lender will provide to the Borrower a
certificate, certifying such Swap Breakage Loss or Swap Breakage Gain, which certified
amount shall be conclusive absent manifest error.  Any Swap Breakage Loss or Swap Breakage
Gain payable pursuant to the terms of the Operative Documents shall be payable in Dollars.

(g)      Each Lender agrees to provide its quotation of Swap Break Costs based upon the
Notional Swap Transaction and as though such Lender were the floating rate payor thereunder.

(h)      References in this Section 25 to any Lender shall, to the extent appropriate, mean
such Lender in its own right or acting through a swap agent.

                                [signature page follows]





         IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be
duly executed by their respective officers thereunto duly authorized as of the day and
year first above written.

                                                           FRONTIER AIRLINES, INC.,
                                                           Borrower


                                                           By:____________________________
                                                           Its:___________________________

                                                           HAMBURGISCHE LANDESBANK
                                                           -GIROZENTRALE-,
                                                           Administrative Agent


                                                           By:____________________________
                                                           Its:___________________________



                                                           By:____________________________
                                                           Its:___________________________



                                                           LENDERS:

                                                           HAMBURGISCHE LANDESBANK
                                                           -GIROZENTRALE-


                                                           By:____________________________
                                                           Its:___________________________



                                                           By:____________________________
                                                           Its:___________________________






                                                                [Credit Agreement [Frontier/HLB]]

Schedule I

                              Notice & Account Information

Lenders

Notice to:

Hamburgische Landesbank -Girozentrale-
Gerhart-Hauptmann-Platz 50
D-20095 Hamburg
Germany
Attention: Dept. Airlines/Stephan Faehrmann

Telephone:  +49-40-3333-2601
Telecopier:  +49-40-3333-3098 (this relates to Lender and Administrative Agent)

Payment Instructions

Bank Name: JPMorgan Chase
Acct. No.: [***]
Acct. Name: Hamburgische Landesbank Girozentrale
ABA No.: [***]
SWIFT No.: [***]
Reference: Frontier Airlines/687 723

Borrower:

Frontier Airlines, Inc.
Frontier Center One
7001 Tower Road
Denver, CO  80249
Attention:  Chief Financial Officer

Telephone:  (720) 374-4510
Telecopier:  (720) 374-4375

[***] Represents material that has been omitted and filed separately with the Securities
and Exchange Commission under a Confidental Treatment Request.




                                                                [Credit Agreement [Frontier/HLB]]

                                          Schedule II

                            Participation in Original Amount


                [All amounts are expressed in millions of U.S. Dollars]






                          % of         Commitment for each           Maximum
  Lender      Original Amount       Aircraft                 Commitment
                                               1743              TBD

Hamburgische                                         Option A
Landesbank
 -Girozentrale-             [***]              [***}             [***]                 [***]

Hamburgische                                         Option B
Landesbank
 -Girozentrale-             [***]              [***}             [***]                 [***]


[***] Represents material that has been omitted and filed separately with the Securities
and Exchange Commission under a Confidental Treatment Request.




                                                                [Credit Agreement [Frontier/HLB]]
                                          EXHIBIT A

                                Form of borrowing notice

                                [LETTERHEAD OF BORROWER]


                                                          ----------------------, 200_

HAMBURGISCHE LANDESBANK -GIROZENTRALE-



Ladies and Gentlemen:

         We refer to the Credit Agreement [Frontier/HLB], dated as of May 23, 2002 (the
"Credit Agreement", which term, if such agreement shall not have been executed and
delivered by the parties thereto prior to the date hereof, shall mean the most
recently circulated draft thereof), among Frontier Airlines, Inc., as borrower (the
"Borrower"), the lenders that are party thereto identified under the caption "Lenders"
on the signature pages thereto or that, pursuant to Section 24(c) thereof, shall
become a "Lender" thereunder (individually, a "Lender" and, collectively, the
"Lenders") and Hamburgische Landesbank -Girozentrale-, as Administrative Agent on
behalf of the Lenders.  Capitalized terms used but not defined in this Borrowing
Notice shall have the meaning given such terms (whether by reference to another
document or otherwise) in the Credit Agreement.

         In accordance with Section 2 of the Credit Agreement, Borrower hereby requests
that a Loan be advanced by the Lenders on __________________ (the "Closing Date").
The Borrower elects Option [A/B].  The Lenders are directed to pay $__________ of the
proceeds of the Commitment by wire transfer to the following account:

                                    [Credit Lyonnais
                                      New York, NY
                                        ABA #: [***]
                                      Account #: [***]
                              Attention: William McIlwain
                             Reference: Frontier MSN _____]

         Borrower agrees that it shall not postpone the Closing Date except as
expressly agreed between the parties in writing.  In the event of a postponement of
the Closing Date or other reduction or modification or termination of the related
Loan, Borrower shall compensate Lenders upon written request by Lenders for all
losses, damages, liabilities and reasonable expenses (including any losses and
expenses incurred on account of funds borrowed, contracted for or utilized for
purposes relating to the Loan or in connection with the re-employment or reinvestment
of such funds or an interruption of the use of such funds and including interest or
other such costs on funds borrowed until such funds are returned to their funding
source) that Lenders sustain as a result of (a) the failure of Borrower to borrow any
part of the Commitment of the Lenders, (b) the repayment or voluntary prepayment of
any portion of the Loan, (c) the failure of Borrower to prepay the Loan on a
prepayment date, (d) the repayment or prepayment of any portion of the Loan as a
result of the exercise by the Administrative Agent or any Lender of its remedies
following the occurrence of an Event of Default, or (e) the repayment or prepayment of
any portion of the Loan.  Compensation to the Lenders under this Borrowing Notice
shall include interest at the Applicable Rate on each Lender's Commitment from the
Closing Date and any Break Amounts and Additional Costs or and other amounts (other
than interest) payable by each Lender to providers of funds obtained by each Lender in
order to make its Commitment, and costs incurred by each Lender in redeploying funds
that were to be used by it to make its Commitment.

[***] Represents material that has been omitted and filed separately with the Securities
and Exchange Commission under a Confidental Treatment Request.


                                                              Very truly yours,

                                                           FRONTIER AIRLINES, INC.


                                                           By:____________________________
                                                           Name:
                                                           Title






                                                                [Credit Agreement [Frontier/HLB]]


                                          EXHIBIT B

                              FORM OF ASSIGNMENT AGREEMENT

         ASSIGNMENT AGREEMENT [Frontier/HLB] dated as of __________ __, ____ between
________________________________ (the "Assignee") and _____________________________
(the "Assignor").

                                          RECITALS

         WHEREAS, the Assignor is the holder of the Note No. ____ dated __________ __,
____ (the "Assignor's Note") issued under the Credit Agreement [Frontier/HLB], dated
as of May 23, 2002 (the "Credit Agreement") between Frontier Airlines, Inc., as
Borrower, the lenders that are party thereto identified under the caption "Lenders" on
the signature pages thereto or that, pursuant to Section 24(c) thereof, shall become a
"Lender" thereunder (individually, a "Lender" and, collectively, the "Lenders") and
Hamburgische Landesbank -Girozentrale-, as Administrative Agent;

         WHEREAS, the Assignor proposes to assign to the Assignee $____________ of the
$_____________ Assignor's Note and a pro rata portion of all of the rights and
obligations of the Assignor under the Credit Agreement and the other Operative
Documents (as defined below) in respect thereof, on the terms and subject to the
conditions set forth herein, and the Assignee proposes to accept the assignment of
such rights and obligations from the Assignor on such terms and subject to such
conditions;

         NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:

         Section 1.  Definitions.  Unless otherwise defined herein, terms defined in
the Credit Agreement are used herein as therein defined.

         Section 2.  Assignment.  On __________ __, ____ (the "Effective Date"), and on
the terms and subject to the conditions set forth herein, the Assignor will sell,
assign and transfer to the Assignee, without recourse to or representation, express or
implied, by the Assignor (except as expressly set forth in Section 5 hereof), a
$___________ portion of the Assignor's Note and a pro rata portion of the rights and
obligations of the Assignor under the Credit Agreement and the other Operative
Documents in respect thereof (but not with respect to any indemnity or other claim,
interest thereon at the Past Due Rate and Break Amounts, if any, accrued and unpaid as
of the Effective Date or thereafter payable to the Assignor in respect of the period
prior to the Effective Date), and the Assignee shall accept such assignment from the
Assignor and assume all of the obligations of the Assignor accruing from and after the
Effective Date under the Credit Agreement and the other Operative Documents relating
to the Assignor's Note on such terms and subject to such conditions.  Upon the
satisfaction of the conditions set forth in Section 4 hereof, (A) the Assignee shall,
on the Effective Date, succeed to the rights and be obligated to perform the
obligations of a Lender under the Credit Agreement and the other Operative Documents,
and (B) the Assignor shall be released from its obligations under the Credit Agreement
and the other Operative Documents accrued from and after the Effective Date, in each
case to the extent such obligations have been assumed by the Assignee.

         Section 3.  Payments.  As consideration for the sale, assignment and transfer
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor, on the
Effective Date, in lawful currency of the United States and in immediately available
funds, to the account specified below its signature on the signature pages hereof, an
amount equal to $_______________.

         Section 4.  Conditions.  This Assignment Agreement shall be effective upon the
due execution and delivery of this Assignment Agreement by the Assignor and the
Assignee and the effectiveness of the assignment contemplated by Section 2 hereof is
subject to (a) the receipt by the Assignor of the payment provided for in Section 3
hereof [and the receipt by the Assignee of an up-front fee in the amount of $_______]
and (b) the delivery to the Administrative Agent of the Assignor's Note, duly endorsed
for [partial] transfer to the Assignee, together with a request in the form attached
hereto as Exhibit A that a new Note be issued to the Assignee and Assignor.

         Section 5.  Representations and Warranties of the Assignor.  The Assignor
represents and warrants as follows:  (a) the Assignor has full power and authority,
and has taken all action necessary to execute and deliver this Assignment Agreement
and any other documents required or permitted to be executed or delivered by it in
connection with this Assignment Agreement and to fulfill its obligations under, and to
consummate the transactions contemplated by, this Assignment Agreement, and no
governmental authorizations or other authorizations are required in connection
therewith, (b) the Assignor's interest in the Assignor's Note is free and clear of any
and all Liens created by or through the Assignor, (c) this Assignment Agreement
constitutes the legal, valid and binding obligation of the Assignor, enforceable
against the Assignor in accordance with its terms, and (d) the Assignor has received
no written notice of any Default having occurred and continuing on the date of
execution hereof.

         Section 6.  Representations and Warranties of the Assignee.  The Assignee
hereby represents and warrants to the Assignor that (a) the Assignee has full power
and authority, and has taken all action necessary to execute and deliver this
Assignment Agreement and any and all other documents required or permitted to be
executed or delivered by it in connection with this Assignment Agreement and to
fulfill its obligations under, and to consummate the transactions contemplated by,
this Assignment Agreement, and no governmental authorizations or other authorizations
are required in connection therewith, (b) this Assignment Agreement constitutes the
legal, valid and binding obligation of the Assignee, enforceable against the Assignee
in accordance with its terms, and (c) the Assignee has fully reviewed the terms of the
Operative Documents and has independently and without reliance upon the Assignor and
based on such information as the Assignee has deemed appropriate, made its own credit
analysis and decision to enter into this Assignment Agreement.

         Section 7.  Further Assurances.  The Assignor and the Assignee hereby agree to
execute and deliver such other instruments, and take such other action, as either
party may reasonably request in connection with the transactions contemplated by this
Assignment Agreement.

         Section 8.  Governing Law.  This Assignment Agreement shall be governed by,
and construed in accordance with, the law of the State of New York.

         Section 9.  Notices.  All communications between the parties or notices in
 connection herewith shall be in writing, hand-delivered or sent by ordinary mail,
telex or facsimile transmitter, addressed as set forth on the signature pages hereof.
All such communications and notices shall be effective upon receipt.

         Section 10. Binding Effect.  This Assignment Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors and
assigns.

         Section 11. Interpretation.  The headings of the various sections hereof are
for convenience of reference only and shall not affect the meaning or construction of
any provision hereof.

         Section 12. Integration of Terms.  This Assignment Agreement contains the
entire agreement between the parties relating to the subject matter hereof and
supersedes all oral statements and other writings with respect to the subject matter
hereof.

         Section 13. Counterparts.  This Assignment Agreement may be executed in one
or more counterparts, each of which shall be an original but all of which, taken
together, shall constitute one and the same instrument.





         IN WITNESS WHEREOF, the parties have caused this Assignment Agreement to be
executed and delivered by their duly authorized officers as of the date first above
written.

                                                           [ASSIGNEE]


                                                           By:____________________________
                                                                Name:
                                                                Title:
                                                           Address for Notices:


                                                           Wire Instructions:
                                                           [ASSIGNOR]


                                                           By:____________________________
                                                                Name:
                                                                Title:

                                                           Address for Notices:

                                                           Wire Instructions:






                                                                [Credit Agreement [Frontier/HLB]]






                                                                Exhibit A
                                                                to Assignment Agreement

                           Request for Note and Registration

                                                                  --------- --, ----


To:      Hamburgische Landesbank -Girozentrale-,
         as Administrative Agent

Ladies and Gentlemen:

         We refer to the assignment by ____________________________ (the "Assignor"),
of certain of its rights and obligations with respect to Note No. ______ (Series __)
in the principal amount of $____________ (the "Assignor's Note") to
___________________________ (the "Assignee"), pursuant to an Assignment Agreement
[Frontier/HLB] dated as of _______ __, ____ between the Assignor and the Assignee.
Capitalized terms not otherwise defined herein shall have the meanings assigned
thereto in such Assignment Agreement.  The Assignor hereby delivers the Assignor's
Note to Hamburgische Landesbank -Girozentrale-, in its capacity as Administrative
Agent.  The Assignor requests Borrower to issue to (i) the Assignee a new Note (the
"New Note") in the principal amount of $____________ and (ii) to the Assignor a new
Note (the "Assignor's New Note") in the principal amount of $______________, each,
with a [Delivery Date] issue date.

         The Administrative Agent is hereby instructed to pay all interest on the
portion of the Assignor's Note being assigned hereunder accrued through the date
hereof directly to Assignor on the Interest Payment Date such interest is payable and
paid.

         The Assignor requests the Administrative Agent to deliver the New Note to the
Assignee at its address set forth below and to deliver the Assignor's New Note to the
undersigned.

                                                           Very truly yours,

                                                           [ASSIGNOR]


                                                           By:____________________________
                                                                Name:
                                                                Title:




                                                           [ASSIGNEE]


                                                           By:____________________________
                                                                Name
                                                                Title:




                                                           Address for Notices:
                                                           Wire Instructions
Accepted and Agreed

HAMBURGISCHE LANDESBANK
- -GIROZENTRALE-,
as Administrative Agent


By:________________________________
     Title:







                                       Exhibit C

                               Terms of Notional Swap Transaction

         (capitalized terms used herein without definition shall have the meanings
    assigned thereto in the Definitions (as defined in the definition of Swap Form))

                  Trade Date:                      __________ __, ____1

                  Effective Date:                  __________ __, ____2

                  Termination  Date:               __________ __, 2___3, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.

                  Notional Amount:                 The Notional Amount in effect for a
                                                   Calculation Period shall be the
                                                   amount set forth in Schedule I
                                                   attached hereto opposite the
                                                   applicable date beginning such
                                                   Calculation Period; provided,
                                                   however, that such dates are subject
                                                   to adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention only with respect to
                                                   determining the Floating Payments.
                  Fixed Payments

                  Fixed Rate
                  Payer:                           Party B. [Lender]

                  Fixed Rate
                  Payment Dates:                   The __ of every _________,
                                                   __________, ____________ and
                                                   ________4, beginning __________ __,
                                                   ____5 and ending on the Termination
                                                   Date, payable in arrears, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.
                  Fixed Rate
                  Period End
                  Dates:                           The __ of every __________,
                                                   ___________, ___________ and
                                                   ________6, beginning __________ __,
                                                   ____7 and ending on the Termination
                                                   Date (no adjustment of Period End
                                                   Dates).
                  Fixed Rate:                      _____%.8

                  Fixed Rate
                  Day Count
                  Fraction:                        30/360.

                  Compounding:                     Inapplicable.

                  Floating Payments

                  Floating
                  Rate Payer:                       Party A. [Lender or Swap Agent]

                  Floating Rate
                  Payment Dates:                   The ___ of every __________,
                                                   _________, __________ and _________9,
                                                   beginning __________ __, ____10 and
                                                   ending on the Termination Date,
                                                   payable in arrears, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.

                  Floating Rate
                  Option                           USD - LIBOR - BBA (except for first
                                                   Calculation Period)

                  Floating Rate                    ___%11 (exclusive of Spread)
                  for first
                  Calculation
                  Period:

                  Spread:                          [1.50%][1.60%] - Option A/B

                  Designated                       [Except for first Calculation Period,
                  Maturity:                        three months for each Calculation
                                                   Period.]

                  Floating Rate                    Actual/360.
                  Day Count
                  Fraction:

                  Floating Rate                    Each Floating Rate Payment Date, exclusive
                  Reset Dates:                     of the last Floating Rate Payment Date.

                  Compounding:                     Inapplicable.

                  Business Day for                 London
                  Rate Setting:

                  Business Day for                 New York, Denver and London
                  Payments:







                                       SCHEDULE I


                                         TO THE


                       CONFIRMATION OF THE RATE SWAP TRANSACTION




                               DATED __________ __, ____






  DATE12                                                       NOTIONAL AMOUNT13

EX-10

                                                                                               EXECUTION COPY

PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION IN A CONFIDENTAL TREATMENT REQUEST UNDER
RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.



                                              CREDIT AGREEMENT
                                              [Frontier/2002-A]

                                                 Dated as of

                                                June 26, 2002


                                                    among



                                          FRONTIER AIRLINES, INC.,
                                                  Borrower,


                                         THE LENDERS LISTED HEREIN,


                                                     and


                                 LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE,
                              as Administrative Agent on behalf of the Lenders

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

                                   One (1) Airbus Model A319-111 Aircraft

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






                                            SkyBlue Capital LLC,
                                            Debt Placement Agent






                                                  TABLE OF CONTENTS
                                                                                                               Page

Section 1.        Certain Definitions and Interpretive Matters...................................................1
Section 2.        Loans; Borrower's Notice of Delivery Date; Closing Procedure; Alternative Structure............1
Section 3.        Fees...........................................................................................2
Section 4.        Conditions.....................................................................................3
Section 5.        Closing Procedure..............................................................................7
Section 6.        Extent of Interest of Lenders..................................................................7
Section 7.        Representations and Warranties.................................................................7
Section 8.        Indemnities...................................................................................12
Section 9.        Covenants of the Borrower.....................................................................19
Section 10.       The Notes.....................................................................................23
Section 11.       Events Of Default; Certain Rights of Administrative Agent.....................................28
Section 12.       Remedies......................................................................................30
Section 13.       Replacement Engines...........................................................................35
Section 14.       The Administrative Agent......................................................................36
Section 15.       Investment Of Funds...........................................................................39
Section 16.       Supplements and Amendments to the Mortgage and Other Operative Documents......................39
Section 17.       Notices.......................................................................................40
Section 18.       Governing Law; Consent to Jurisdiction; Waiver of Jury Trial..................................41
Section 19.       Costs and Expenses............................................................................42
Section 20.       Section 1110 Compliance.......................................................................42
Section 21.       Confidentiality...............................................................................42
Section 22.       Covenants of the Administrative Agent and the Lenders.........................................43
Section 23.       Leveraged Lease Financing.....................................................................43
Section 24.       Miscellaneous.................................................................................44
Section 25.       Terms of Fixed Rate Setting...................................................................46



Schedule I        Notice & Account Information
Schedule II       Participation in Original Amount
Exhibit A         Form of Borrowing Notice
Exhibit B         Form of Assignment Agreement
Exhibit C         Terms of Notional Swap Transaction






                                     CREDIT AGREEMENT [Frontier/2002-A]

         THIS CREDIT AGREEMENT [Frontier/2002-A] dated as of June 26, 2002 among (i) Frontier Airlines,
Inc., a Colorado corporation (the "Borrower"), (ii) the lenders that are party hereto identified under the
caption "Lenders" on the signature pages hereto or that, pursuant to Section 24(c) hereof, shall become a
"Lender" hereunder (individually, a "Lender" and, collectively, the "Lenders") and (iii) Landesbank
Schleswig-Holstein Girozentrale, a Landesbank organized under the laws of Germany, as Administrative Agent
on behalf of the Lenders (the "Administrative Agent").

                                            W I T N E S S E T H:

         WHEREAS, certain terms are used herein as defined in Section 1 hereof; and

         WHEREAS, concurrently with the execution and delivery of this Agreement, the Borrower and the
Administrative Agent are entering into the Mortgage and Security Agreement [Frontier/2002-A] dated as of
the date hereof (the "Mortgage") pursuant to which the Borrower agrees, among other things, to issue one or
more Notes in respect of the Aircraft as evidence of the Borrower's indebtedness to the Lenders, which
Notes will be secured by the mortgage and security interest created by the Borrower in favor of the
Administrative Agent on behalf of the Lenders, and the Borrower shall execute and deliver a Mortgage
Supplement covering the Aircraft, supplementing the Mortgage.

         NOW THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto
agree as follows:

Section 1.        Certain Definitions and Interpretive Matters.

         Except as otherwise defined in this Agreement, including its annexes, schedules and exhibits,
terms used herein in capitalized form shall have the meanings attributed thereto in the Mortgage.  The
rules of interpretation contained in Section 1.02 of the Mortgage shall be applicable to this Agreement.
Unless the context otherwise requires, any reference herein to any of the Operative Documents refers to
such document as it may be modified, amended or supplemented from time to time in accordance with its terms
and the terms of each other agreement restricting the modification, amendment or supplement thereof.

Section 2.        Loans; Borrower's Notice of Delivery Date; Closing Procedure; Alternative Structure.

(a)      Loans.  Subject to the terms and conditions of this Agreement, each Lender agrees to make a
secured loan to the Borrower in respect of the Aircraft (herein called a "Loan") on a date to be designated
pursuant to Section 2 hereof, on or about June 26, 2002 but in no event later than December 31, 2002 (the
"Commitment Termination Date"), in the amount in Dollars set forth opposite such Lender's name in Schedule II
hereto (its "Commitment"), and to receive, as evidence of each such secured loan, Note(s) in an amount equal
to its Commitment.  The aggregate amount of the Commitments for the Aircraft shall equal the Original Amount
for the Aircraft. Each Loan shall bear interest and amortize in accordance with Section 2.02 of the Mortgage.
If any Lender shall default in its obligation to make the amount of its Commitment available pursuant to this
Section 2 in respect of the Aircraft, no other Lender shall have an obligation to make any portion of such
amount available or to increase the amount of its commitment for the Aircraft and the obligations of the
non-defaulting Lender shall remain subject to the terms and conditions set forth in this Agreement.

(b)      Notice of Delivery Dates.  The Borrower agrees to give the Lenders and the Administrative Agent
at least three (3) Business Days' prior written notice of the Delivery Date for the Aircraft, which Delivery
Date shall be a Business Day not later than the Commitment Termination Date by executing and delivering a
borrowing notice substantially in the form of Exhibit A hereto (the "Borrowing Notice"), which notice shall
also specify (if not previously selected as provided in paragraph (e) below) the Term Option elected and any
funding instructions.  The payment by each Lender of its Commitment in respect of the Aircraft in the manner
required by this Section 2 shall constitute a waiver of such notice.

(c)      Closing Procedure.  Subject to the terms and conditions of this Agreement, and simultaneous with
receipt by the Seller of the Original Amount for the Aircraft pursuant to this Section 2, the Borrower shall
authorize the delivery and filing for record at the FAA of the Mortgage and the Mortgage Supplement.  On the
Delivery Date specified in the Borrower's notice referred to in the first paragraph of this Section 2, subject
to the terms and conditions of this Agreement, each Lender agrees to pay, through the Administrative Agent, the
amount of its Commitment to the Seller by wire transferring such amounts to the Seller's account at Credit
Lyonnais, 1301 Avenue of the Americas, New York, NY 10019, ABA No. [***] Account # [***], Attention:  Mustapha
Diop, Reference Frontier MSN 1761 or to such other account as the Borrower shall direct the Administrative
Agent (on behalf of the Lenders) in writing, upon closing.

[***] Represents material that has been omitted and filed separately with the Securities and Exchange
Commission under a Confidental Treatment Request.

(d)      Alternative Structure.  Notwithstanding anything to the contrary in this Agreement or any other
Operative Document, the Borrower, subject to the provisions of this Section 2(d) and Section 23 hereof, may
elect to finance the Aircraft on the basis of a U.S. leveraged lease financing, whereupon the Lenders'
Commitments shall be utilized for such purpose, and the Lenders' obligations to finance the Aircraft on a
mortgage basis, and the Borrower's obligations to use the Lenders' Commitments to finance the Aircraft on a
mortgage basis, shall be deemed discharged by such utilization.

(e)      Term Option.  The Borrower shall notify the Administrative Agent on or prior to the Delivery
Date of the Term Option for the Aircraft, which notice shall be irrevocable.

Section 3.        Fees.  (a)  The Borrower agrees to pay to the Administrative Agent (on behalf of the
Lenders), on or before the Delivery Date, an up-front fee of the percentage (the "Up-front Fee") of the
Original Amount of each Loan to be funded on the Delivery Date as separately agreed, to the account of the
Administrative Agent specified in Schedule I hereto (or such other account as the Administrative Agent may
direct in writing).

(b)      The Borrower agrees to pay to the Administrative Agent (on behalf of the Lenders), after the date
hereof, a commitment fee of [***]% (the "Commitment Fee") on the unutilized Commitments, to the account
of the Administrative Agent specified in Schedule I hereto (or such other account as the Administrative Agent
may direct in writing). The Commitment Fee shall accrue from and including September 26, 2002 to but excluding
the earlier of (x) the Delivery Date and (y) the Commitment Termination Date.  The Commitment Fee shall be
payable on the earlier dates contemplated by clauses (x) and (y) of the preceding sentence.  The Commitment
Fee shall be calculated on the basis of a year of 360 days and actual number of days elapsed.  Promptly
following receipt by the Administrative Agent of the Commitment Fee in respect of any period, the
Administrative Agent shall distribute the same to each Lender, pro rata based on such Lender's unutilized
Commitments.

[***] Represents material that has been omitted and filed separately with the Securities and Exchange
Commission under a Confidental Treatment Request.

Section 4.        Conditions.  (a)  Conditions Precedent to the Effectiveness of the Commitment.
It is agreed that the Commitment of the Lenders is subject to the satisfaction prior to or on the Delivery Date
of the following conditions precedent:

(i)      The following documents shall have been duly authorized, executed and delivered by the respective
         party or parties thereto, shall each be satisfactory in form and substance to the Administrative
         Agent and each Lender and shall be in full force and effect and executed counterparts shall have been
         delivered to the Lenders and the Administrative Agent or their respective counsel:

(A)      the Mortgage; and

(B)      a copy of that portion of the Purchase Agreement and Engine Agreement certified by the Secretary or
                  an Assistant Secretary of the Borrower as being a true and accurate copy of the same that
                  relates to the Assigned Warranties and the related obligations of the Borrower or a successor
                  in interest to the Borrower which has the right to exercise any such warranty.

(ii)     Each Lender and the Administrative Agent shall have received the following, in each case in form and
         substance satisfactory to each of them:

(A)      a certified copy of the Articles of Incorporation and Bylaws of the Borrower and a copy of resolutions
                  of the board of directors of the Borrower or the executive committee thereof, certified by
                  the Secretary or an Assistant Secretary of the Borrower, duly authorizing the execution,
                  delivery and performance by the Borrower of this Agreement, the Mortgage and each other
                  document required to be executed and delivered by the Borrower on the Delivery Date in
                  accordance with the provisions hereof and thereof; and

(B)      a certificate of the Borrower as to the Person or Persons authorized to execute and deliver this
                  Agreement, the other Operative Documents, and any other documents to be executed on behalf
                  of the Borrower in connection with the transactions contemplated hereby and as to the
                  signature of such person or persons.

(iii)    Each Lender and the Administrative Agent shall have received an opinion addressed to such Lender and
         the Administrative Agent from each of: (A) David Sislowski, Esq., General Counsel for the Borrower
         and (B) Curtis Mallet-Prevost, Colt & Mosle LLP, special counsel to the Borrower, each in form and
         substance reasonably satisfactory to the addressees thereof.

(b)      Conditions Precedent to each Lender's Commitment to Lend on the Delivery Date.  It is agreed that
the respective obligations of each Lender to lend its Commitment to the Borrower in respect of the Aircraft is
subject to the satisfaction prior to or on the Delivery Date of the following conditions precedent:

(i)      Each Lender and the Administrative Agent shall have received from the Borrower a duly executed
         Borrowing Notice with respect to the Delivery Date pursuant to Section 2 hereof.

(ii)     No change shall have occurred after the date of the execution and delivery of this Agreement in
         applicable law or regulations thereunder or interpretations thereof by appropriate regulatory
         authorities which, in the reasonable opinion of each Lender would make it a violation of law or
         regulations for such Lender to make its Commitment for the Aircraft available to fund the applicable
         Loan or to realize the benefits of the security afforded by the Mortgage in respect thereof.

(iii)    On the Delivery Date, the Aircraft will have been duly certified by the FAA as to type and airworthiness,
         will have been insured by the Borrower in accordance with the terms of the Mortgage, will have suffered
         no Event of Loss (or event which, with the passage of time would constitute an Event of Loss) and will be
         in the condition and state of repair required under the terms of the Mortgage.

(iv)     The following documents shall have been duly authorized, executed and delivered by the respective party
         or parties thereto, shall each be satisfactory in form and substance to the Lenders and the Administrative
         Agent and shall be in full force and effect and executed counterparts shall have been delivered to the
         Lenders and the Administrative Agent or their respective counsel, provided that only each Lender
         shall receive an executed original of its respective Note(s):

(A)      the Mortgage Supplement covering the Aircraft and dated the Delivery Date;  Schedule 1 to such Mortgage
                  Supplement shall be completed as provided in Section 2.02(c) of the Mortgage;

(B)      the Note(s) in an aggregate principal amount equal to the Original Amount reflecting the Term Option
                  selected by the Borrower;

(C)      the Consent and Agreement and the Engine Consent and Agreement, each of which shall be in form and
                  substance reasonably satisfactory to the Administrative Agent; and

(D)      the Warranty Bill of Sale and FAA Bill of Sale for the Aircraft.

(v)      The Borrower shall have authorized the filing by the Administrative Agent of Uniform Commercial Code
         financing statement or statements covering all the security interests created by or pursuant to the
         granting clause of the Mortgage that are not covered by the recording system established by the Federal
         Aviation Act, and such financing statement or statements shall have been duly filed in all places deemed
         necessary or advisable in the opinion of counsel for the Lenders, and any additional Uniform
         Commercial Code financing statements deemed advisable by the Lenders shall have been duly filed
         and all other action shall have been taken as is deemed necessary or advisable, in the opinion of
         counsel for the Lenders, to establish and perfect the Administrative Agent's security interest in
         the Aircraft.

(vi)     All appropriate action required to have been taken by the Federal Aviation Administration, or any
         governmental or political agency, subdivision or instrumentality of the United States, on or prior to
         the Delivery Date in connection with the transaction contemplated by this Agreement shall have been
         taken, and all orders, permits, waivers, authorizations, exemptions and approvals of such entities
         required to be in effect on the Delivery Date in connection with the transaction contemplated by this
         Agreement shall have been issued, and all such orders, permits, waivers, authorizations, exemptions and
         approvals shall be in full force and effect on the Delivery Date.

(vii)    On the Delivery Date the following statements shall be true, and the Lenders shall have received
         evidence satisfactory to it to the effect that:

(A)      the Borrower has good title to the Aircraft, free and clear of Liens other than (subject to filing and
                  recording of the FAA Bill of Sale with the Federal Aviation Administration if the Borrower
                  does not already own the Aircraft) the mortgage and security interests created by the Mortgage
                  and the Mortgage Supplement;

(B)      the Mortgage, the FAA Bill of Sale and the Mortgage Supplement have been duly filed with the FAA for
                  recordation (or are in the process of being so filed for recordation) and there exist no Liens
                  of record on the Aircraft prior to the Lien of the Mortgage;

(C)      the Aircraft has been duly certified as to type and airworthiness by the FAA, and the Borrower has
                  authority to operate the Aircraft (and the Lenders shall have received a copy of the
                  airworthiness certificate for the Aircraft); and

(D)      the Administrative Agent is entitled to the protection of Section 1110 of the United States Bankruptcy
                  Code in connection with its right to take possession of the Aircraft in the event of a case
                  under Chapter 11 of the United States Bankruptcy Code in which the Borrower is a debtor.

(viii)   On the Delivery Date, the representations and warranties of the Borrower contained in Section 7(a) of
         this Agreement shall be true and accurate as though made on and as of each such date except to the
         extent that such representations and warranties relate solely to an earlier date (in which case such
         representations and warranties shall be true and accurate on and as of such earlier date),
         including the representation and warranty that there had not occurred any event which constitutes
         a Default or an Event of Default which is presently continuing.

(ix)     Each Lender and the Administrative Agent shall have received an opinion addressed to such Lender and
         the Administrative Agent from each of:  (A) David Sislowski, Esq., General Counsel for the Borrower
         and (B) Curtis Mallet-Prevost, Colt & Mosle LLP, special counsel to the Borrower, each in form and
         substance reasonably satisfactory to the addressees thereof.

(x)      Each Lender and the Administrative Agent shall have received an opinion addressed to such Lender and
         the Administrative Agent and the Borrower from Daugherty, Fowler, Peregrin & Haught, FAA counsel in
         Oklahoma City, Oklahoma, in form and substance reasonably satisfactory to the addressees thereof.

(xi)     The Administrative Agent and each Lender shall have received an opinion addressed to the Administrative
         Agent and each Lender from in-house counsel to Seller, in respect of the Bills of Sale for the Aircraft
         delivered on the Delivery Date, in form and substance reasonably satisfactory to the addressees thereof.

(xii)    Each Lender and the Administrative Agent shall have received a certificate signed by the President, a
         Vice President, the Chief Financial Officer or the Treasurer of the Borrower, dated the Delivery Date,
         addressed to each Lender and the Administrative Agent and certifying as to the matters stated in
         paragraphs (viii) and (xiv) of this Section 4(b).

(xiii)   Each Lender and the Administrative Agent shall have received an independent insurance brokers' report
         and certificate(s) of insurance, in form and substance reasonably satisfactory to each Lender and the
         Administrative Agent as to the due compliance with the terms of Article VI of the Mortgage relating
         to insurance with respect to the Aircraft.

(xiv)    On the Delivery Date it shall be true that no Event of Loss (or event which with the passage of time
         would become an Event of Loss) with respect to the Aircraft (or the Airframe) or any Engine has occurred.

(xv)     No action or proceeding shall have been instituted nor shall governmental action be threatened before
         any court or governmental agency, nor shall any order, judgment or decree have been issued or proposed
         to be issued by any court or governmental agency at the time of the Delivery Date to set aside,
         restrain, enjoin or prevent the completion and consummation of this Agreement or the transaction
         contemplated hereby.

(xvi)    The Administrative Agent shall have received the Up-front Fee pursuant to Section 3(a) and, if applicable,
         any Commitment Fee pursuant to Section 3(b) that is due and payable.

(xvii)   The Lenders shall have received from the Borrower the statement of financial position and statement of
         earnings and cash flow for the Borrower for the fiscal quarter most recently ended at least 60 days
         prior to the Delivery Date, and since the date of such statement of financial position and statement of
         earnings and cash flow, there shall have occurred no materially adverse change in the financial
         condition or operations of the Borrower which would affect the Borrower's ability to perform its
         obligations hereunder or under any of the Operative Documents.

(xviii)  No material disruption shall have occurred in the London interbank market that may have an adverse
         effect upon the Lenders.

(xix)    Each other Lender shall have made available the amount of its Commitment for the Aircraft in accordance
         with Section 2(a) hereof.

Promptly upon the recording of the Mortgage and the Mortgage Supplement covering the Aircraft pursuant to
the Federal Aviation Act, the Borrower will cause Daugherty, Fowler, Peregrin & Haught, FAA counsel in
Oklahoma City, Oklahoma, to deliver to the Lenders, the Administrative Agent and the Borrower an opinion as
to the due and valid registration of the Aircraft in the name of the Borrower, the due recording of the
Mortgage and the Mortgage Supplement and the lack of filing of any intervening documents with respect to
the Aircraft.  Promptly following the Delivery Date, the Borrower shall cause a huissier to serve a copy of
a notice delivered on the Delivery Date on the Manufacturer and the Seller in accordance with Article 1690
of the French Civil Code.

Section 5.        Closing Procedure.  Following the Borrower's notice of the Delivery Date as provided
in Section 2 hereof, the parties will pre-position the executed Mortgage and Mortgage Supplement with FAA
counsel in Oklahoma City, Oklahoma, together with the FAA Bill of Sale for the Aircraft and the application
for registration of the Aircraft in the name of the Borrower.  On the Delivery Date and in sufficient time to
permit the closing to occur during business hours of the FAA in Oklahoma City, Oklahoma, each Lender will wire
transfer, through the Administrative Agent, its Commitment to the Seller.  On the Delivery Date, by conference
telephone call among the Seller, the Borrower, the Lenders (and/or their counsel acting on their behalf), the
Administrative Agent and FAA counsel, the Seller will authorize the filing of the FAA Bill of Sale for the
Aircraft and the Borrower will authorize the filing of the Mortgage and the Mortgage Supplement upon
receipt by the Seller of the Original Amount of the Loan for the Aircraft.  The irrevocable authorization
to FAA counsel to date the FAA Bill of Sale and the Mortgage Supplement and file the FAA Bill of Sale and
the Mortgage and Mortgage Supplement will occur prior to the transfer of the Original Amount of the Loan
for the Aircraft to the Seller, but the filing will not occur until the Seller's receipt of the purchase
price for the Aircraft.  The Note(s) will be delivered to the Lenders, as applicable, and legal opinions
will be delivered to all parties immediately following the filing of the FAA Bill of Sale and the Mortgage
and Mortgage Supplement at the FAA.

Section 6.        Extent of Interest of Lenders.  No Lender shall have any further interest in, or other
right with respect to, the mortgage and security interests created by the Mortgage when and if the Original Amount
of and interest on all Note(s) held by such Lender and all other sums payable to such Lender hereunder, under the
Mortgage and under such Note(s) shall have been paid in full.

Section 7.        Representations and Warranties.  (a)  Borrower's Representations and Warranties.
The Borrower represents and warrants that on the date hereof and on the Delivery Date:

(i)      the Borrower is a corporation duly organized and validly existing in good standing pursuant to the
         laws of the State of Colorado; is duly qualified to do business as a foreign corporation in each
         jurisdiction in which its operations or the nature of its business requires, except where the failure
         to be so qualified would not have a material adverse effect on the Borrower or its business; is a U.S.
         Air Carrier; maintains its location (as such term is defined in Article 9 of the Uniform Commercial Code)
         in Colorado; and has the corporate power and authority to engage in air transport and to carry on
         scheduled passenger service as presently conducted, to own the Aircraft and to enter into and
         perform its obligations under the Operative Documents;

(ii)     the execution, delivery and performance by the Borrower of the Operative Documents will, on the Delivery
         Date, have been duly authorized by all necessary corporate action on the part of the Borrower, do not
         require any stockholder approval, or approval or consent of any trustee or holders of any indebtedness
         or obligations of the Borrower except such as have been duly obtained or by the Delivery Date will
         have been duly obtained and will on the Delivery Date be in full force and effect, and none of
         such Operative Documents contravenes any law, judgment, government rule, regulation or order
         binding on the Borrower or the articles of incorporation or bylaws of the Borrower or contravenes
         the provisions of, or constitutes a default under, or results in the creation of any Lien (other
         than Permitted Liens) upon the property of the Borrower under, any indenture, mortgage, contract
         or other agreement to which the Borrower is a party or by which it or its properties may be bound
         or affected;

(iii)    neither the execution and delivery by the Borrower of the Operative Documents nor the performance by
         the Borrower of its obligations thereunder requires the consent or approval of, the giving of notice
         to, or the registration with, or the taking of any other action in respect of any Federal, state or
         foreign government authority or agency, except for (A) the orders, permits, waivers, exemptions,
         authorizations and approvals of the regulatory authorities having jurisdiction over the operation
         of the Aircraft by the Borrower, which orders, permits, waivers, exemptions, authorizations and
         approvals have been duly obtained or will on or prior to the Delivery Date be duly obtained, and
         will on the Delivery Date be in full force and effect, (B) any normal periodic and other reporting
         requirements under the Federal Aviation Act and the regulations promulgated thereunder and the
         applicable rules, and regulations of the FAA, in each case to the extent required to be given or
         obtained only after the Delivery Date, (C) any filings, registrations or applications specifically
         described in this Agreement, and (D) an air operator's certificate with respect to Airbus Model
         A319 aircraft, which certificate has been obtained by the Borrower;

(iv)     the Operative Documents to which the Borrower is a party delivered on or prior to the date hereof or
         the Delivery Date, as the case may be, each constitute legal, valid and binding obligations of the
         Borrower enforceable against the Borrower in accordance with the terms thereof except as such may be
         limited by equitable principles or applicable bankruptcy, insolvency, reorganization, moratorium or
         other similar laws affecting creditors' rights generally;

(v)      there are no pending or, to the best of Borrower's knowledge, threatened actions or proceedings before
         any court, arbitrator or administrative agency which individually (or in the aggregate in the case of
         any group of related lawsuits) is expected to have a material and adverse effect on the financial
         condition of the Borrower or the ability of the Borrower to perform its obligations under the Operative
         Documents;

(vi)     except for (A) the filing for recording pursuant to the Federal Aviation Act of the FAA Bill of Sale
         for the Aircraft (and the application for registration of the Aircraft in the name of the Borrower)
         and the Mortgage with the Mortgage Supplement for the Aircraft, (B) the filing of financing statements
         (and continuation statements at periodic intervals) with respect to the interests created by such
         documents under the Uniform Commercial Code of Colorado and such other states as may be specified
         in the opinion furnished pursuant to Section 4(b)(ix) hereof and (C) the affixation of the
         nameplates referenced in Section 3.04 of the Mortgage, no further action, including any filing or
         recording of any document (including any financing statement in respect thereof under Article 9 of
         the Uniform Commercial Code of any applicable jurisdiction), is necessary or advisable in order to
         establish and perfect the first mortgage Lien on the Aircraft in favor of the Administrative Agent
         pursuant to the Mortgage in any applicable jurisdiction in the United States;

(vii)    there has not occurred any event which constitutes a Default or an Event of Default hereunder which is
         presently continuing;

(viii)   the statements of financial position of the Borrower as of March 31, 2002 and the date of the most
         recently concluded fiscal quarter of the Borrower for which a statement of financial position has been
         provided and the related statements of earnings and cash flow of the Borrower in all material respects
         for the year and fiscal quarter, respectively, then ended, copies of which have been furnished to the
         Lenders, fairly present the financial condition of the Borrower at such date and the results of operations
         and cash flow of the Borrower for the period ended on such dates, in accordance with generally
         accepted accounting principles consistently applied, and subject, in the case of the statements
         pertaining to the Borrower's most recently concluded fiscal quarter, to normal year-end
         adjustments, and since March 31, 2002, there has been no material and adverse change in the
         business or financial condition of the Borrower;

(ix)     on the Delivery Date the Borrower will have good title to the Mortgage Estate delivered on the Delivery
         Date free and clear of all Liens, except the Lien of the Mortgage, and Inchoate Liens;

(x)      neither the Borrower nor anyone acting on behalf of the Borrower has directly or indirectly offered any
         interest in the Notes for sale to, or solicited any offer to acquire any of the same from, anyone other
         than the Lenders and not more than 35 other institutions believed capable of evaluating and bearing the
         risks of investment in the transactions contemplated hereby;

(xi)     the Borrower has filed or caused to be filed all Federal, state, local and (to the best of Borrower's
         knowledge) foreign tax returns which are required to be filed and has paid or caused to be paid or
         provided adequate reserves for the payment of all taxes shown to be due and payable on such returns or
         (except to the extent being contested in good faith and by appropriate proceedings and for the payment
         of which adequate reserves have been provided in accordance with generally accepted accounting
         principles) on any assessment received by the Borrower, to the extent that such taxes have become
         due and payable, except such returns or taxes as do not materially and adversely affect the
         business, property or assets, operations or financial condition, of the Borrower and do not
         involve a material risk of the sale, forfeiture or loss of, or the creation of any Lien (other
         than a Permitted Lien) on the Aircraft;

(xii)    the Borrower is not (x) in default under any indenture, mortgage, lease or Credit Agreement or under
         any other agreement or instrument of a material nature to which the Borrower is now a party or by which
         it is bound, and no event has occurred and is continuing which, under the provisions of any such indenture,
         mortgage, Credit Agreement or other material agreement or instrument, with the lapse of time or
         the giving of notice, or both, would constitute a default thereunder or (y) in violation of any
         law, order, injunction, decree, rule or regulation applicable to the Borrower of any court or
         administrative body, which violation (a) would reasonably be expected to materially and adversely
         affect the business, operations or financial condition of the Borrower or the Borrower's ability
         to execute, deliver and perform its obligations under the Operative Documents or (b) would involve
         a material risk of the sale, forfeiture or loss of, or the creation of any Lien (other than a
         Permitted Lien) on, any of the Mortgage Estate;

(xiii)   the Borrower has not engaged in any transaction in connection with which the Borrower could be subjected
         to either a material civil penalty assessed pursuant to Section 502(i) of ERISA, or a material tax imposed
         by Section 4975 of the Code; (w) no material liability to the Pension Benefit Guaranty Corporation
         (other than liability for premiums) has been incurred by the Borrower with respect to any Plan;
         (x) there has been no event or condition which presents a material risk of termination of any Plan
         by the Pension Benefit Guaranty Corporation; (y) no accumulated funding deficiency (as defined in
         Section 302 of ERISA and Section 412 of the Code), whether or not waived, exists with respect to
         any Plan; and (z) no material amount of "withdrawal liability," as that term is used in
         Section 4201 of ERISA, has been or is expected to be incurred by the Borrower nor has the Borrower
         or any affiliate of the Borrower been notified by any multi-employer plan (within the meaning of
         Section 3(37)(A) of ERISA) that such multi-employer plan is in reorganization or insolvency within
         the meaning of Section 4241 or Section 4245 of ERISA or that such multi-employer plan intends to
         terminate or has been terminated under Section 4041A of ERISA (for purposes of this subclause (z),
         the term "affiliate" shall mean any corporation or person which is a member of the same controlled
         group of corporations (within the meaning of Section 414(b) of the Code) as the Borrower or is
         under common control (within the meaning of Section 414(c) of the Code) with the Borrower);

(xiv)    neither the Borrower nor any Plan nor any trust created thereunder has engaged in a "prohibited transaction,"
         within the meaning of Section 406 of ERISA or Section 4975 of the Code with respect to the transactions
         contemplated hereby which could subject the Borrower to any tax or penalty pursuant to
         Section 4975 of the Code or Section 502(i) of ERISA;

(xv)     the Borrower is not an "investment company" as defined in, or subject to regulation under, the Investment
         Company Act of 1940 and the Borrower is not a "holding company" as defined in, or subject to regulation
         under, the Public Utility Holding Company Act of 1935;

(xvi)    none of the reports, financial statements, certificates or other information furnished by or on behalf
         of the Borrower to the Administrative Agent or the Lenders in connection with the negotiation of this
         Agreement or delivered hereunder (as modified or supplemented by other information so furnished) contains
         any material misstatement of fact or omits to state any material fact necessary to make the statements
         therein, in the light of the circumstances under which they were made, not misleading;

(xvii)   no part of the proceeds of any Loan hereunder will be used, whether directly or indirectly, for any
         purpose that entails a violation of any of the Regulations of the Board of Governors of the Federal
         Reserve, including Regulations U and X;

(xviii)  assuming the Lenders are acquiring their Notes in the ordinary course of their commercial banking business,
         none of the transactions contemplated by this Agreement will violate or result in a violation of the
         Securities Act of 1933, as amended, the securities Exchange Act of 1934, as amended, or any
         regulations issued pursuant thereto; and

(xix)    no United States Federal or state non-banking governmental approval of any kind is required of any Lender
         for its execution of or performance under this Agreement or any agreement contemplated hereby solely by
         reason of any fact or circumstance peculiar to: (a) the Borrower, (b) the nature of the Aircraft, or
         (c) the Borrower's proposed operation or use of the Aircraft.

(b)      Lenders' Representations and Warranties.  Each Lender severally represents and warrants to each of
the other Parties hereto, as of the date hereof and as of the Delivery Date that:

(i)      it is acquiring its Notes in the ordinary course of its commercial banking business and it has no present
         intention of distributing or reselling any interest to be acquired by it hereunder or under any of the
         other Operative Documents or any part thereof in violation of the Securities Act of 1933, as amended; and

(ii)     no part of the funds to be used by it to purchase or fund, as the case may be, its Notes or its interest
         under any of the Operative Documents constitutes plan assets of an employee benefit plan which is subject
         to ERISA and/or subject to Section 4975 of the United States Internal Revenue Code of 1986, as amended.
         As used in this Section 7(b)(ii), the term "plan assets" shall have the meaning assigned to such term
         under ERISA and the regulations promulgated thereunder.

Section 8.        Indemnities.  (a)  General Indemnity.  Subject to the next following paragraph but
without limiting any other rights that any Indemnitee may have under the other Operative Documents or applicable law,
the Borrower hereby agrees to indemnify each Indemnitee on an after-tax basis against, and agrees to protect, save
and keep harmless each of them from any and all Expenses imposed on, incurred by or asserted against any Indemnitee
arising out of or resulting from (i) the operation, possession, use, maintenance, overhaul, testing,
registration, reregistration, delivery, non-delivery, lease, nonuse, modification, alteration, or sale of
the Aircraft, the Airframe or any Engine, or any engine used in connection with the Airframe or any part of
any of the foregoing by the Borrower, any lessee or any other Person whatsoever, whether or not such
operation, possession, use, maintenance, overhaul, testing, registration, reregistration, delivery,
non-delivery, lease, nonuse, modification, alteration, or sale is in compliance with the terms of the
Mortgage, including, without limitation, claims for death, personal injury or property damage or other loss
or harm to any person whatsoever and claims relating to any laws, rules or regulations pertaining to such
operation, possession, use, maintenance, overhaul, testing, registration, reregistration, delivery,
non-delivery, lease, non-use, modification, alteration, sale or return including environmental control,
noise and pollution laws, rules or regulations; (ii) the manufacture, design, purchase, acceptance,
rejection, delivery, or condition of the Aircraft, the Airframe or any Engine, any engine used in
connection with the Airframe, or any part of any of the foregoing including, without limitation, latent and
other defects, whether or not discoverable, or trademark or copyright infringement; (iii) any breach of or
failure to perform or observe, or any other noncompliance with, any covenant or agreement to be performed,
or other obligation of the Borrower under any of the Operative Documents, or the falsity of any
representation or warranty of the Borrower in any of the Operative Documents; and (iv) any Event of Default
hereunder or the enforcement against the Borrower of any of the terms hereof (including, without
limitation, Section 12 hereof).

                  The foregoing indemnity shall not extend to any Expense of any Indemnitee to the extent
attributable to one or more of the following:  (1) acts or omissions involving the willful misconduct or
gross negligence of such Indemnitee or any Person acting on behalf of such Indemnitee (other than gross
negligence imputed to such Indemnitee solely by reason of its interest in the Aircraft, as finally
determined by a court of competent jurisdiction); (2) any Tax, or increase in tax liability under any tax
law (such matter being subject to the indemnity in Sections 8(b) and (c) hereof); (3) a failure on the part
of the Administrative Agent to distribute in accordance with the Operative Documents any amounts received
and distributable by it thereunder; (4) any breach of undertaking or any misrepresentation contained herein
or in any other Operative Document to which such Indemnitee is a party or any agreement relating hereto or
thereto by such Indemnitee and in each case not attributable directly to any breach of undertaking, any
misrepresentation or any noncompliance with any of the terms hereof or of any other Operative Document or
any agreement relating hereto or thereto by Borrower; (5) a Lender Lien; or (6) a violation of the
Securities Act relating to or arising out of the offer, issuance, sale or delivery by such Indemnitee (or
any person who controls such Indemnitee within the meaning of Section 15 of the Securities Act) of any
security based upon the credit of the Borrower.

                  If a claim is made against an Indemnitee involving one or more Expenses and such
Indemnitee has notice thereof, such Indemnitee (or its agent) shall promptly after receiving such notice
give notice of such claim to the Borrower; provided that the failure to provide such notice shall not
release the Borrower from any of its obligations to indemnify hereunder except to the extent that the
Borrower is prejudiced as a result of the failure to give such notice in a timely fashion, and no payment
by the Borrower to an Indemnitee pursuant to this Section 8(a) shall be deemed to constitute a waiver or
release of any right or remedy which the Borrower may have against such Indemnitee for any actual damages
as a result of the failure by such Indemnitee to give the Borrower such notice.  The Borrower shall be
entitled, at its sole cost and expense, acting through a single counsel reasonably acceptable to the
respective Indemnitee, so long as the Borrower has acknowledged in writing its responsibility for such
Expense hereunder (unless such Expense is covered by the second paragraph of this Section 8(a), except that
such acknowledgment does not apply if the decision of a court or arbitrator provides that the Borrower is
not liable hereunder), (A) in any judicial or administrative proceeding that involves solely a claim for
one or more Expenses, to assume responsibility for and control thereof, (B) in any judicial or
administrative proceeding involving a claim for one or more Expenses and other claims related or unrelated
to the transactions contemplated by the Operative Documents, to assume responsibility for and control of
such claim for Expenses to the extent that the same may be and is severed from such other claims (and such
Indemnitee shall use its reasonable efforts to obtain such severance), and (C) in any other case, to be
consulted by such Indemnitee with respect to judicial proceedings subject to the control of such Indemnitee
and to be allowed, at the Borrower's sole expense, to participate therein.  The Indemnitee may participate
at its own expense and with its own counsel in any judicial proceeding controlled by the Borrower pursuant
to the preceding provisions.  Notwithstanding any of the foregoing, the Borrower shall not be entitled to
assume responsibility for and control of any such judicial or administrative proceedings if any Event of
Default shall have occurred and be continuing, if such proceedings will involve a material risk of the
sale, forfeiture or loss of the Aircraft unless the Borrower shall have posted a bond or other security
reasonably satisfactory to the relevant Indemnitee with respect to such risk or if such proceedings could
entail any risk of criminal liability being imposed on such Indemnitee.

                  The Indemnitee shall supply the Borrower with such information reasonably requested by
the Borrower as is necessary or advisable for the Borrower to control or participate in any proceeding to
the extent permitted by this Section 8(a).  Such Indemnitee shall not enter into a settlement or other
compromise with respect to any Expense without the prior written consent of the Borrower, which consent
shall not be unreasonably withheld or delayed, unless such Indemnitee waives its right to be indemnified
with respect to such Expense under this Section 8(a).  In the case of any Expense indemnified by Borrower
hereunder which is covered by a policy of insurance maintained by Borrower, each Indemnitee agrees, at
Borrower's expense, to cooperate reasonably with the insurers in the exercise of their rights to
investigate, defend or compromise such loss or liability as may be reasonably required to retain the
benefits of such insurance with respect to such loss or liability.

                  To the extent of any payment of any Expense pursuant to this Section 8(a), the Borrower,
without any further action, shall be subrogated to any claims the Indemnitee may have relating thereto.
The Indemnitee agrees to give such further assurances or agreements and to cooperate with the Borrower to
permit the Borrower to pursue such claims, if any, to the extent reasonably requested by the Borrower.

                  In the event that the Borrower shall have paid an amount to an Indemnitee pursuant to
this Section 8(a), and such Indemnitee subsequently shall be reimbursed in respect of such indemnified
amount from any other Person, such Indemnitee shall promptly pay the Borrower the amount of such
reimbursement, including interest received attributable thereto, provided that no Special Default or Event
of Default has occurred and is continuing.

                  Amounts payable under this Section 8(a) shall be payable by the Borrower within thirty
days of demand therefor.

(b)      General Tax Indemnity.

(i)      Subject to the exclusions described in Section 8(b)(ii) below, any and all payments by the Borrower
         to the Administrative Agent or any Lender (each, a "Tax Indemnitee") under this Agreement or any of the
         other Operative Documents shall be made free and clear of and without deduction for any and all present
         or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect
         thereto, excluding taxes measured by or based on net or taxable income (all such non-excluded
         taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter
         referred to as "Taxes").  If any Taxes shall be required by law to be deducted from or in respect
         of any sum payable under this Agreement to any Tax Indemnitee, then (i) the sum payable by the
         Borrower shall be increased as may be necessary so that after making all required deductions in
         respect of such Taxes (including deductions applicable to additional sums payable under this
         Section) such Tax Indemnitee (as the case may be) receives an amount equal to the sum it would
         have received had no such deductions been made, (ii) the Borrower shall make such deductions, and
         (iii) the Borrower shall pay the full amount deducted to the relevant taxation authority or other
         authority in accordance with applicable law.  The Borrower shall not, however, be required to pay
         amounts, if any, pursuant to clause (i) of the preceding sentence to any Tax Indemnitee organized
         under the laws of a jurisdiction outside of the United States of America unless such Tax
         Indemnitee provides or has provided to the Borrower a completed Internal Revenue Service
         Form W-8ECI or Form W-8BEN, or any successor form, or Form W-9, or any successor form, and any
         other applicable form, certificate or document prescribed by the Internal Revenue Service of the
         United States certifying as to such Tax Indemnitee's entitlement to an exemption from, or
         reduction of, United States withholding tax on payments to be made hereunder and any new or other
         forms or certificates prescribed by the Internal Revenue Service of the United States in the event
         that a lapse in time or change in circumstance renders a previous certification obsolete or
         inaccurate in any material respect.

                  The Borrower agrees to pay any present or future stamp, recording or documentary taxes or
similar levies that arise from any payment made under this Agreement or under any other Operative Document
or from the execution, delivery or registration of, or otherwise with respect to, this Agreement or any
other Operative Document (hereinafter referred to as "Other Taxes").

                  The Borrower will indemnify each Tax Indemnitee on an after-tax basis for the full amount
of Taxes or Other Taxes (including any Taxes or Other Taxes imposed by any jurisdiction on amounts payable
under this Section) paid by such Tax Indemnitee  and any liability (including penalties, interest,
additions to tax and expenses) arising therefrom or with respect thereto, whether or not such Taxes or
Other Taxes were correctly or legally asserted.  The Borrower shall pay any indemnification requested under
this Section within 30 days from the date any Tax Indemnitee or  their respective agent (as the case may
be) makes written demand therefor.

                  Within 30 days after the date of any payment of Taxes or Other Taxes, the Borrower will
furnish to the relevant Tax Indemnitee the original or a certified copy of a receipt or other documents
reasonably acceptable to the relevant Tax Indemnitee evidencing payment of such Taxes or Other Taxes.

                  If, as a result of an assignment under Section 24(c)(iii) below, a Person organized under
the laws of a jurisdiction outside of the United States becomes a Tax Indemnitee and payments to it to be
made under this Agreement are exempt from United States withholding tax, or are subject to such tax at a
reduced rate under an applicable tax treaty, then such assignee shall provide to the Borrower, promptly
following the date that it became a Tax Indemnitee and from time to time thereafter, so long as it is
lawfully able to do so in its reasonable judgment, a properly completed and executed Internal Revenue
Service Form W-8ECI or Form W-8BEN or Form W-9, or any successor form, and any other applicable form,
certificate document prescribed by the Internal Revenue Service certifying as to such assignee's
entitlement to such exemption or reduced rate with respect to all payments to be made to such assignee
under this Agreement and any new or other forms or certificates prescribed by the Internal Revenue Service
of the United States in the event that a lapse in time or change in circumstance renders a previous
certification obsolete or inaccurate in any material respect.  Unless the Borrower shall have received
forms or other documents reasonably satisfactory to it establishing that payments under this Agreement are
not subject to United States withholding tax, or are subject to such tax at a rate under an applicable tax
treaty, the Borrower shall, subject to its obligations under Section 8(a), withhold taxes from such
payments at the applicable statutory rate in the case of payments to or for any Tax Indemnitee, if it is
organized under the laws of a jurisdiction outside the United States.

                  Within 30 days after written request from the Borrower the relevant Tax Indemnitee, as
appropriate, shall, so long as no Default or Event of Default shall have occurred, execute and deliver to
the Borrower such certificates, forms or other documents which can be furnished consistent with the facts
and applicable law, and which are reasonably necessary for the Tax Indemnitee to obtain a refund of Taxes
indemnified by the Borrower under this Section (which shall be paid to the Borrower promptly upon receipt).

                  Without prejudice to the survival of any other provision of this Agreement, the
agreements and obligations of the Borrower contained in this Section shall survive the repayment in full of
the Loans.

(ii)     Exclusions.  In addition to any exclusions described in Section 8(b)(i) above, the foregoing tax
         indemnity shall not apply to:

(A)      Taxes imposed on a Tax Indemnitee resulting from such Tax Indemnitee not claiming any applicable
                  exemption or rate reduction under any applicable law or treaty (unless such Tax Indemnitee
                  provides, at Borrower's expense, an opinion of independent counsel, selected by such Tax
                  Indemnitee and reasonably acceptable to Borrower, that there is no reasonable basis for such
                  claim; provided that, Borrower notifies such Tax Indemnitee in writing that any such exemption
                  is available and such Tax Indemnitee determines in good faith that neither it nor any
                  Affiliate will be adversely impacted by claiming any such applicable exemption);

(B)      Taxes imposed on a Tax Indemnitee resulting from such Tax Indemnitee failing to comply with certification,
                  information, documentation, reporting or similar requirements concerning the nationality,
                  residence, identity or connection with the jurisdiction imposing such Taxes if such Tax Indemnitee
                  was aware of the requirement to comply and such Tax Indemnitee's compliance is required
                  by applicable law or treaty as a precondition to relief or exemption from such Taxes and
                  such Tax Indemnitee was eligible for such relief or exemption, unless such failure to
                  comply was due to failure of Borrower timely to notify the Tax Indemnitee in writing of
                  such requirement or to provide reasonable assistance in complying with such requirement
                  or the Tax Indemnitee determines in good faith that either it or any Affiliate will be
                  adversely impacted by so complying;

(C)      Taxes imposed on a Tax Indemnitee resulting from the actual gross negligence (other than gross negligence
                  or willful misconduct imputed or attributed to such Tax Indemnitee by reason of its interest in
                  the Aircraft, Engine or Part) or willful misconduct of such Tax Indemnitee;

(D)      Taxes imposed upon a Tax Indemnitee as a result of any transfer by such Tax Indemnitee of the Aircraft,
                  Engine or Part or the Lease or any other Operative Document or of such Tax Indemnitee's interest
                  in any thereof unless such transfer is requested by Borrower or occurs at a time when an Event
                  of Default has occurred and is continuing;

(E)      Taxes imposed upon any Tax Indemnitee in its individual capacity based on or measured by fees for services
                  rendered under the Operative Documents; and

(F)      Taxes imposed upon any Tax Indemnitee with respect to any period after (1) the termination of the Mortgage,
                  in accordance with the terms thereof and (2) payment of all amounts payable under the Operative
                  Documents having been made.

                                    (For purposes of this Agreement and the other Operative Documents,
                  Taxes, other than those exempted in Section 8(b)(i) or by virtue of clauses (A) through
                  (F) above, are hereinafter referred to as "Indemnified Taxes".)

                                    In the event of a dispute between Borrower and any Tax Indemnitee
                  regarding the applicability of any of the exclusions described in Section 8(b)(i) or
                  Section 8(b)(ii) or the amount of any Indemnified Taxes, Borrower within 30 days of
                  demand therefor shall pay to such Tax Indemnitee any amount of Tax claimed to be owed
                  pursuant to Section 8(b)(i), as the case may be.  Any payment made by Borrower pursuant
                  to the immediately preceding sentence shall be refunded by the relevant Tax Indemnitee if
                  it subsequently is on a final and unconditional basis established that such amount was
                  not required to be paid under this Section 8(b)(i) or (b)(ii) hereof, as the case may be.

(iii)    Contest.  If a claim is made against any Tax Indemnitee for any Indemnified Taxes (a "Claim"),
         such Tax Indemnitee will, as promptly as practical after such Tax Indemnitee has received written
         notification of such Claim, give Borrower written notice of such Claim; provided that, that a
         failure to give such notice in a timely manner shall not preclude a Claim for indemnification hereunder
         except to the extent that the Borrower is prejudiced as a result of the failure to give such notice in a
         timely fashion.  If Borrower so requests in writing within thirty (30) calendar days after receipt of
         such notice, such Tax Indemnitee shall consult with Borrower to consider what action may be taken to resist
         payment of the relevant Indemnified Taxes and following such consultation such Tax Indemnitee may
         take any reasonable action in the name of such Tax Indemnitee to contest the Claim in the name of
         such Tax Indemnitee or, in such Tax Indemnitee's sole discretion, in the name of Borrower, to the
         extent permitted by law; provided that, the following conditions are met:

(A)      such Tax Indemnitee shall have received adequate provision satisfactory to it for such Claim and any
                  liability, expense or loss arising out of or related to such contest (including without
                  limitation indemnification for all costs, expenses, losses, reasonable legal and accounting fees
                  and disbursements, penalties and interest);

(B)      the contest will not result in any danger of the sale, forfeiture or loss of, or the creation of any Lien
                  on, the Aircraft, any Engine, any Part, or any interest therein unless bonded in a manner and
                  amount acceptable to the Tax Indemnitees;

(C)      if such contest shall be conducted in a manner requiring the payment of the Claim, Borrower shall have
                  paid such Claim to the extent required;

(D)      no Default or Event of Default shall have occurred and be continuing;

(E)      prior to commencing any administrative appeal, Borrower shall have acknowledged its liability to such
                  Tax Indemnitee hereunder for the contested amount;

(F)      such Tax Indemnitee shall have received a legal opinion (at the expense of Borrower) from counsel selected
                  by such Tax Indemnitee (and reasonably satisfactory to Borrower) indicating that a reasonable
                  basis for such contest exists; and

(G)      such Tax Indemnitee has not received, or does not receive, an opinion from its external tax advisor
                  concluding that the proposed actions to contest such Claim would trigger a significant
                  possibility of creating a local franchise issue of the Tax Indemnitee (e.g., adverse publicity or
                  impairing of the Tax Indemnitee's relationship with local regulators) or impairing the
                  status of other open tax matters (e.g., tax audits) between such Tax Indemnitee and the
                  local taxing authorities.

                                    Notwithstanding the foregoing provisions of this Section 8(b)(iii), no
                  Tax Indemnitee shall be obligated to contest a Claim to the United States Supreme Court.
                  In addition, notwithstanding the foregoing provisions of this Section 8(b), if at any
                  time such Tax Indemnitee waives its right of indemnification under this Section 8(b) in
                  respect of a Claim, or if, after having received payment of indemnification from Borrower
                  hereunder in respect of such Claim, such Tax Indemnitee tenders such payment to Borrower,
                  then Borrower shall not be entitled to contest, or to continue to contest, any such Claim.

(iv)     If by reason of any Indemnified Taxes paid or otherwise indemnified against by the Borrower pursuant to
         this Section 8(b), any Tax Indemnitee at any time actually realizes a net reduction in any Taxes not
         indemnified against by the Borrower and not previously taken into account in computing the amount of any
         indemnity payable by the Borrower under this Section 8(b), such Tax Indemnitee shall, so long as
         no Special Default or Event of Default shall have occurred, promptly pay to the Borrower an amount
         that, after subtraction of any further Tax savings such Tax Indemnitee realizes as a result of the
         payment thereof, is equal to the amount of such net Tax reduction; provided that any subsequent
         loss of Tax benefit for which payment has been made to the Borrower under this Section 8(b)(iv)
         (or was taken into account in computing an amount payable by the Borrower under this Section 8(b))
         shall be treated as an indemnifiable Tax hereunder without regard to the exclusions set forth in
         Sections 8(b)(i) or 8(b)(ii) hereof.

(v)      Verification.  At the Borrower's written request, the computation of the amount of any indemnity payment
         owed by the Borrower or any amount owed by a Tax Indemnitee to the Borrower pursuant to this Section 8
         shall be verified and certified by an internationally recognized independent public accounting firm
         mutually selected by the Tax Indemnitee and the Borrower.  The costs of such verification
         (including the fee of such public accounting firm) shall be borne by the Borrower unless such
         verification shall result in an adjustment in the Borrower's favor of 5% or more of the net
         present value of the payment as computed by such Tax Indemnitee, in which case the costs shall be
         paid by such Tax Indemnitee.  Such determination shall be final and binding, absent manifest error
         on the part of the certified public accountants.  The Tax Indemnitees hereby agree to cooperate
         with the accountants in connection therewith, provided, however, notwithstanding anything that may
         be to the contrary in the Operative Documents, in no event shall the Borrower have the right to
         examine any information supplied to the verifying firm or the tax returns or books of the Tax
         Indemnitee in connection with the verifying procedures described herein or for any other reason.

(c)      Interest.  The Borrower will pay to each Indemnitee on demand, to the extent permitted by applicable law,
interest on any amount of indemnity not paid when due pursuant to this Section 8 until the same shall be paid, at
the Past Due Rate.

Section 9.        Covenants of the Borrower.  (a)  Borrower Merger.  For so long as the Mortgage remains in force,
the Borrower shall not consolidate with or merge into or with any other Person, and not convey, transfer, lease or
otherwise dispose of all or substantially all of its property and other assets to, or acquire all or any substantial
part of the property or other assets or capital stock of (if such acquisition is analogous in either
purpose or effect to a consolidation or merger), any other Person, unless:

(i)      Such transaction shall not have any material adverse effect on the rights of the Lenders or the Administrative
         Agent under or in respect of the Operative Documents or the Aircraft;

(ii)     The Person formed by or surviving such consolidation or merger or the Person which acquires by conveyance,
         transfer, lease or other disposition all or substantially all of such property and other assets or stock (the
         "Successor Entity"): (A) shall be a corporation organized and existing under the laws of the United
         Sates or any state thereof or the District of Columbia; (B) immediately after giving effect to
         such transaction, shall be the Borrower or shall have acquired or succeeded to all or
         substantially all of the property and other assets of the Borrower (if such assets are being
         transferred) as an entirety, and shall have a tangible net worth (determined in accordance with
         GAAP) of not less than the Borrower's tangible net worth (determined in accordance with GAAP)
         immediately prior to such transaction; (C) shall be a U.S. Air Carrier; and (D) shall execute and
         deliver to the Administrative Agent such recordations and filings with any Governmental Authority
         and such other documents as the Administrative Agent (at the direction of the Lenders) determines
         shall be reasonably necessary or advisable to evidence, or in connection with, such consolidation,
         merger, sale, lease, transfer or other disposition and an agreement, in form and substance
         reasonably satisfactory to the Administrative Agent (at the direction of the Lenders) which is a
         legal, valid, binding and enforceable assumption by such Successor Entity of the due and punctual
         performance and observance of each covenant and condition of the Borrower under the Operative
         Documents to which the Borrower is a party, and an officer's certificate to such effect and to the
         effect that the other requirements of this Section have been satisfied, and a legal opinion from
         counsel to such effect and otherwise in such form and substance reasonably satisfactory to the
         Administrative Agent (at the direction of the Lenders);

(iii)    Such Person shall have a credit rating (as determined by S&P or Moody's, as applicable) no worse than the
         Borrower's immediately prior to such transaction; and

(iv)     No Default shall have occurred and be continuing or shall occur as a result thereof.

         Upon any consolidation or merger in accordance with this Section 9(a), the Successor Entity shall
succeed to, and be substituted for, and may exercise every right and power of, the Borrower under this
Agreement with the same effect as if such Successor Entity had been named as the Borrower herein.

(b)      U.S. Air Carrier.  The Borrower covenants and agrees that at all times it will be an "air carrier" within the
meaning of the Federal Aviation Act operating under certificates issued pursuant to Section 40102(a) of such Act and shall
otherwise meet the standards of the definition of U.S. Air Carrier.

(c)      Further Assurances.  The Borrower covenants and agrees with each party hereto as follows:

(i)      The Borrower will cause to be done, executed, acknowledged and delivered all and every such further acts,
         conveyances and assurances as the Lenders shall reasonably require for accomplishing the purposes of this
         Agreement and the other Operative Documents; provided that any instrument or other document so
         executed by the Borrower will not expand any obligations or limit any rights of the Borrower in
         respect of the transactions contemplated by any Operative Documents.  The Borrower shall cause the
         Aircraft to remain duly registered, in the name of the Borrower, except as otherwise required or
         permitted hereunder or under the Mortgage, under the Federal Aviation Act.

(ii)     The Borrower, at its expense, will cause (A) the Mortgage, all Mortgage Supplements and all amendments to the
         Mortgage to be promptly filed and recorded, or filed for recording, to the extent permitted under the Federal
         Aviation Act, or required under any other applicable law and (B) the lien of the Mortgage to at
         all times be and remain a first priority and perfected Lien on the Mortgage Estate.  The Borrower
         agrees to furnish the Administrative Agent and the Lenders with copies of the foregoing documents
         with recording data as promptly as practicable following the issuance of same by the FAA.

(iii)    The Borrower shall pay all reasonable costs and expenses (including costs and disbursements of counsel)
         incurred by the Administrative Agent and the Lenders after the date hereof in connection with (x) any
         supplements or amendments of the Operative Documents (including, without limitation, any related recording
         costs) (other than any supplement or amendment associated with a transfer of any Note or the sale
         of participation interests therein not requested by Borrower), (y) any Default and any enforcement
         or collection proceedings resulting therefrom or in connection with the negotiation of any
         restructuring or "work-out" (whether or not consummated), or (z) the enforcement of this Section 9.

(d)      Liens.  The Borrower will not directly or indirectly create, incur, assume or suffer to exist any Lien
on or with respect to the Mortgage Estate, title thereto or any interest therein except (i) the rights of the Borrower
as herein provided, the Lien of the Mortgage and any other rights existing pursuant to the Operative Documents,
(ii) Liens for Taxes of the Borrower either not yet due or being contested in good faith by appropriate
proceedings (and for which adequate reserves have been provided in accordance with GAAP), so long as the
continuing existence of such Liens during such proceedings do not involve any material risk of the sale,
forfeiture or loss of the Airframe or any Engine or any interest therein, (iii) mechanics', material
suppliers', workers', repairers', employees' or other like Liens arising in the ordinary course of the
Borrower's business for amounts that are not overdue or are being contested diligently and in good faith by
appropriate proceedings (and for which adequate reserves have been provided in accordance with generally
accepted accounting principles), so long as there is not, or the continuing existence of such Liens during
such proceedings do not involve, any material risk of sale, forfeiture or loss of the Airframe or any
Engine or any interest therein, (iv) Liens arising out of any judgment or award against the Borrower with
respect to which an appeal or proceeding for review is being prosecuted diligently and in good faith, so
long as such Liens do not result in a material risk of the sale, forfeiture or loss of the Airframe or any
Engine or any interest therein, (v) the rights of others under agreements or arrangements to the extent
expressly permitted by the terms of Sections 3.03, 4.02 and 4.04 of the Mortgage, (vi) customary salvage or
similar rights of insurers under policies required to be maintained by the Borrower under Article VI of the
Mortgage, (vii) any other Lien with respect to which the Borrower shall have provided a bond or other
security in an amount and under terms reasonably satisfactory to the Administrative Agent and (viii) Lender
Liens.  The Borrower will promptly, at its own expense, take (or cause to be taken) such actions as may be
necessary duly to discharge any Lien not excepted above if the same shall arise at any time.

(e)      Inspection.  At reasonable times, the Administrative Agent or its authorized representatives on behalf
of the Lenders, may inspect the Aircraft and FAA (or other applicable governmental authority) required books and
records of the Borrower relating to the maintenance of the Aircraft (at the inspecting party's expense (other than in
the case of an inspection occurring while an Event of Default has occurred and is continuing or if a material
deviation from the required Aircraft condition is discovered, in which case the Borrower shall bear the
reasonable cost of such inspection)) and shall keep any information obtained thereby confidential as
provided in Section 21 hereof.  Any such inspection of the Aircraft shall be upon reasonable advance notice
from such inspecting party to the Borrower, shall be during normal business hours and shall be a visual,
walk-around inspection (including on-board inspection) and may include inspection of areas exposed by any
open panels, bays or the like, but shall not include opening any panels, bays or the like without the
express written consent of the Borrower; provided that, so long as no Event of Default shall have occurred
and be continuing, no exercise of such inspection right shall interfere with the normal operation or
maintenance of the Aircraft by, or the business of, the Borrower.  The Administrative Agent shall not have
any duty to make any such inspection nor shall it incur any liability or obligation by reason of not making
any such inspection.

(f)      Amendments, Supplements, Etc.  Forthwith upon the execution and delivery of each Mortgage Supplement
from time to time required by the terms of the Mortgage and upon the execution and delivery of any amendment to the
Mortgage or this Agreement, the Borrower will cause such Mortgage Supplement or amendment to be duly filed and
recorded, and maintained of record, in accordance with the applicable laws of the government of registry of
the Aircraft.  In addition, the Borrower will promptly and duly execute and deliver to the Lenders and the
Administrative Agent (on behalf of the Lenders) such further documents and take such further action as the
Lenders or the Administrative Agent (on behalf of the Lenders) may from time to time reasonably request in
order to more effectively carry out the intent and purpose of the Mortgage and to establish and protect the
rights and remedies created or intended to be created in favor of the Administrative Agent and the Lenders
hereunder and under the Mortgage, including, without limitation, if requested by the Administrative Agent,
at the expense of Borrower, the execution and delivery of supplements or amendments hereto, each in
recordable form, subjecting to the Mortgage any engine substituted for any Engine pursuant to the terms
thereof and the recording or filing of counterparts hereof, in accordance with the laws of such
jurisdiction as the Administrative Agent may reasonably request.

(g)      Access to or Furnishing of Information.  The Borrower agrees to furnish to the Administrative Agent
(and the Administrative Agent shall provide to the Lenders):

(i)      as soon as available, but not later than 90 days after the close of each fiscal year of the Borrower
         occurring after the date hereof, an audited balance sheet and related statements of the Borrower at and as
         of the end of such fiscal year, together with an audited statement of income and cash flows of the Borrower
         for such fiscal year, each of which shall be prepared in accordance with GAAP and shall be
         accompanied by an unqualified opinion of a firm of independent public accountants of nationally
         recognized standing that said financial statements fairly present in all material respects the
         financial condition and results of operation of the Borrower as at the end of, and for, such
         period in accordance with GAAP;

(ii)     as soon as available, but not later than 60 days after the close of each of the first three quarters of each
         fiscal year of the Borrower, an unaudited balance sheet of the Borrower at and as of the end of such quarter,
         together with an unaudited statement of income and cash flows of the Borrower for such quarter,
         each of which shall be prepared in accordance with GAAP, certified by the Chief Financial Officer
         of the Borrower that said financial statements fairly present in all material respects the
         financial condition and results of operation of the Borrower as at the end of, and for, such
         period in accordance with GAAP (subject to normal year-end audit adjustments);

(iii)    on an annual basis, together with the financial statements delivered pursuant to the preceding paragraph (i),
         a certificate of the chief financial officer, Treasurer, any Vice President, or other officer of the Borrower
         elected by the Borrower's Board of Directors stating that such authorized officer has reviewed the
         activities of the Borrower and that, to the best knowledge of such authorized officer, there
         exists no Default or Event of Default hereunder;

(iv)     simultaneously with the mailing thereof to its shareholders, copies of all such financial statements, SEC
         Forms 10-K and 10-Q reports, notices of proxy statements as the Borrower shall mail to its shareholders
         generally;

(v)      from time to time, such other information as the Administrative Agent or any Lender may reasonably request; and

(vi)     promptly after the occurrence thereof and actual knowledge thereof by a responsible officer of the Borrower,
         notice to the Administrative Agent and the Lenders of any Default or Event of Default.

(h)      Related Operative Documents.  The Borrower shall not amend any Related Operative Document without the
prior written consent of the Administrative Agent which consent shall not be unreasonably withheld.

Section 10.       The Notes.  (a)  Method of Payment.  Principal and interest and other amounts due hereunder
or under the Notes or in respect hereof or thereof shall be payable in Dollars in immediately available funds prior to
11:00 a.m., New York, New York time, on the due date thereof, to the Administrative Agent at the Payment Office and the
Administrative Agent shall, subject to the terms and conditions hereof and of the Mortgage, remit all such
amounts so received by it to each Lender at the account set forth in Schedule I hereto or to such other
account or accounts as such Lender may designate to the Administrative Agent in writing from time to time,
in immediately available funds for distribution to the Lenders, such payment to be made, in the case of any
such designated account in New York, New York, prior to 1:00 p.m., New York time, on the due date thereof.
In the event the Administrative Agent shall fail to make any such payment as provided in the immediately
foregoing sentence after its receipt of funds at the place and prior to the time specified above, the
Administrative Agent agrees to compensate the Lenders for loss of use of funds in a commercially reasonable
manner.  All such payments by the Borrower and the Administrative Agent shall be made free and clear of and
without reduction on account of all wire and other like charges.  Prior to the due presentment for
registration of transfer of any Note, the Borrower and the Administrative Agent may deem and treat the
Person in whose name any Note is registered on the Note Register as the absolute owner of such Note for the
purpose of receiving payment of all amounts payable with respect to such Note and for all other purposes
whether or not such Note shall be overdue, and neither the Borrower nor the Administrative Agent shall be
affected by any notice to the contrary.

(b)      Application of Payments.  Except as otherwise expressly provided herein, each payment of principal and
interest or other amounts due in respect of each Note shall be distributed to each Lender ratably, without priority
of any one Note over any other Note, in the proportion that the amount of such payment or payments then due under
each Note bears to the aggregate amount of the payments then due under all Notes.  Each such payment shall,
except as otherwise expressly provided herein, be applied, first, to the payment of any amount (other than
the principal of or interest on such Note) due in respect of such Note, second, to the payment of interest
on such Note (as well as any interest on overdue principal and, to the extent permitted by law, interest
and other amounts payable thereunder) due thereunder, third, to the payment of the principal of such Note
then due and fourth, the balance, if any, remaining thereafter, to the payment of the principal of such
Note remaining unpaid (provided that such Note shall not be subject to prepayment without the consent of
such Lender except as permitted by Sections 10(f) and 10(g) hereof).  The amounts paid pursuant to clause
fourth above shall be applied to the installments of principal of such Note in inverse order of maturity.

(c)      Registration, Transfer and Exchange of Notes.  The Administrative Agent agrees with the Borrower that
the Administrative Agent shall keep a register (herein sometimes referred to as the "Note Register") in which provision
shall be made for the registration of Notes and the registration of transfers of Notes.  Prior to the due
presentment for registration of the transfer of any Note, the Borrower and the Administrative Agent shall
deem and treat the Person in whose name such Note is registered on the Note Register as the absolute owner
of such Note, and the Lender for the purpose of receiving payment of all amounts payable with respect to
such Note, and for all other purposes whether or not such Note is overdue, and neither the Borrower nor the
Administrative Agent shall be affected by notice to the contrary.  The Note Register shall be kept at the
office of the Administrative Agent or at the office of any successor Administrative Agent, and the
Administrative Agent is hereby appointed "Note Registrar" for the purpose of registering Notes and
transfers of Notes as herein provided.  Subject to Section 24(c) hereof, upon surrender for registration of
transfer of any Note at the Payment Office and upon delivery by the Administrative Agent to the Borrower of
such surrendered Note, the Borrower shall execute, and the Administrative Agent shall deliver, in the name
of the designated transferee or transferees, one or more new Notes of a like aggregate principal amount.
At the option of the Lender, its Notes may be exchanged for other Notes of any authorized denominations, of
a like aggregate principal amount, upon surrender of the Notes to be exchanged at the Payment Office.  Each
new Note issued upon transfer or exchange shall be in a principal amount of at least $5,000,000 (except as
may be necessary to evidence the entire outstanding principal amount of a Note) and dated the Delivery
Date.  Whenever any Notes are so surrendered for exchange, the Borrower shall execute and deliver the Notes
which the Lender making the exchange is entitled to receive.  All Notes issued upon any registration of
transfer or exchange of Notes shall be the valid obligations of the Borrower evidencing the same respective
obligations, and entitled to the same security and benefits under the Mortgage, as the Notes surrendered
upon such registration of transfer or exchange.  Every Note presented or surrendered for registration of
transfer or exchange, shall (if so required by the Administrative Agent) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the Administrative Agent duly
executed by the Lender or its attorney duly authorized in writing, and the Administrative Agent may require
evidence satisfactory to it as to the compliance of any such transfer with the Securities Act and the
securities laws of any applicable state.  The Administrative Agent shall make a notation on each new Note
or Notes of the amount of all payments of principal previously made on the old Note or Notes with respect
to which such new Note is issued and the date to which interest accrued on such old Note or Notes has been
paid.  The Administrative Agent shall not be required to register the transfer of or exchange any
surrendered Notes as above provided during the five calendar day period preceding the due date of any
payment on such Notes.  The Administrative Agent shall give the Borrower and the Lenders notice of each
transfer of a Note under this Section 10(c).  Any such transferee of a Note, by its acceptance of a Note,
agrees to the provisions of the Operative Documents applicable to the Lenders, and shall be deemed to have
covenanted to the parties to the Operative Documents as to the matters covenanted by the original Lender
therein; provided that no transferee of a Note shall be entitled to receive any greater amount pursuant to
Section 10(h) of this Agreement than the transferor of such Note would have been entitled to receive had no
such transfer occurred.

(d)      Mutilated, Destroyed, Lost or Stolen Notes.  If any Note shall become mutilated, destroyed, lost or
stolen, the Borrower shall, upon the written request of the Lender, execute and deliver in replacement thereof,
a new Note in the same principal amount, dated the date of such Note and designated as issued under the Mortgage.
If the Note being replaced has become mutilated, such Note shall be surrendered to the Administrative Agent and
the original thereof shall be furnished to the Borrower by the Administrative Agent.  If the Note being
replaced has been destroyed, lost or stolen, the Lender shall furnish to the Borrower and the
Administrative Agent such security or indemnity as may be reasonably required by them to hold the Borrower
and the Administrative Agent harmless and evidence satisfactory to the Borrower and the Administrative
Agent of the destruction, loss or theft of such Note and of the ownership thereof; provided, however, that
if the Lender is an original party hereto or an Affiliate thereof or a bank or other financial institution
with a net worth (or capital and surplus, as the case may be) in excess of $500,000,000, the written notice
of such destruction, loss or theft and such ownership and the written undertaking of the Lender delivered
to the Borrower and the Administrative Agent to hold harmless the Borrower and the Administrative Agent in
respect of the execution and delivery of such new Note shall be sufficient evidence, security and indemnity.

(e)      Payment of Expenses on Transfer.  Upon the issuance of a new Note or new Notes pursuant to Sections
10(c) or (d), the Borrower and/or the Administrative Agent may require from the party requesting such new Note or
Notes payment of a sum sufficient to reimburse the Borrower and/or the Administrative Agent for, or to provide
funds for, the payment of any tax or other governmental charge in connection therewith or any charges and
expenses connected with such tax or other governmental charge paid or payable by the Borrower or the
Administrative Agent.

(f)      Prepayment.  (i)  On at least ten Business Days' prior written notice, the Borrower may prepay on the
date specified in its notice of prepayment delivered pursuant to this Section 10(f) in whole, or in part, the Notes
then outstanding at the principal amount thereof (or portion thereof to be repaid), together with accrued
interest thereon to the date of prepayment plus all Break Amount and Additional Costs, if any, and all
other amounts due to each Lender hereunder, thereunder and under the other Operative Documents; provided
that any partial prepayment shall be in an aggregate original principal amount of at least $5,000,000 and
in $1,000,000 multiples thereof, the amount thereof shall be specified in such written notice and such
partial prepayment shall be applied to the remaining installments of the Loan in the inverse order of
maturity.  The Administrative Agent will give prompt notice to the Lenders of the Borrower's intent to
prepay any Note.

(ii)     On at least ten Business Days' prior written notice, the Borrower shall prepay on the date specified in its notice of
         prepayment delivered pursuant to this Section 10(f) the Notes in full, but not in part, together
         with accrued interest thereon to the date of prepayment plus all Break Amount and Additional
         Costs, if any, and all other amounts due thereunder and hereunder and under the other Operative
         Documents to the Lenders upon the occurrence of an Event of Loss with respect to the Aircraft;
         such prepayment shall, in any event, be no later than the last day permitted for such payment
         under Section 5.01 of the Mortgage.  The Administrative Agent will give notice of prepayment to
         the Lenders under this Section 10(f)(ii) promptly.

(iii)    Any notice of prepayment delivered pursuant to paragraph (i) or (ii) above shall be irrevocable if not revoked within five
         Business Days of the specified date of payment and shall identify the amount to be prepaid.

(g)      Provisions Relating to Prepayment.  (i)  Notice of prepayment having been given and not revoked as
aforesaid, the principal amount of the Notes so to be prepaid, plus accrued interest thereon to the date of prepayment,
together with the Break Amount and Additional Costs, if any, herein provided, shall become due and payable on the
prepayment date.

(ii)     On the date fixed for prepayment under Section 10(f), immediately available funds in Dollars shall be deposited by the
         Borrower in the account of the Administrative Agent at the place and by the time and otherwise in
         the manner provided in Section 10(a), in an amount equal to the principal amount of Notes to be
         prepaid together with accrued and unpaid interest thereon to the date fixed for such prepayment,
         all Break Amount and Additional Costs, if any, and all other amounts due to the Lenders hereunder,
         thereunder and under the other Operative Documents.

(iii)    Each Lender shall furnish to the Borrower, with a copy to the Administrative Agent, a certificate setting forth in
         reasonable detail the calculation of the amounts of Break Amount due to such Lender, which
         certificate shall be presumptively correct absent manifest error.

(iv)     The amount of any prepayment may not be reborrowed.

(h)      Increased Costs.  (i)  The Borrower shall pay to the Administrative Agent for the account of each
Lender from time to time such amounts as such Lender may determine to be necessary to compensate such Lender for any
increase in actual costs that such Lender determines are attributable to its making, funding or maintaining its
Commitment or the Loans or any reduction in any amount receivable by such Lender hereunder in respect of
any of its Commitments or the Loans (such increases in costs and reductions in amounts receivable,
including amounts covered by clause (ii) below, being herein called "Additional Costs"), resulting from any
Regulatory Change that:

(A)      imposes any tax that is the functional equivalent of any reserve, special deposit or similar requirement of
                  the sort covered by clause (ii) below; or

(B)      imposes or modifies any reserve, special deposit or similar requirements (including any Reserve Requirement)
                  relating to any extensions of credit or other assets of, or any deposits with or other liabilities
                  of, any Lender (including, without limitation, any of such loans or any deposits referred to
                  in the definition of "LIBOR" in Section 1.01 of the Mortgage), or any such obligations;
                  or

(C)      imposes any other condition affecting the Mortgage, or its Notes (or any of such extensions of credit or
                  liabilities) or any such obligation.

(ii)     Without limiting the effect of the foregoing provisions of this Section 10(h) (but without duplication),
         the Borrower shall pay to the Administrative Agent for account of any Lender from time to time on request
         such amount as the Lender may determine to be necessary to compensate such Lender (or, without duplication,
         the holding company of which such Lender is a subsidiary) for any increase in actual costs that it
         determines are attributable to the maintenance by such Lender (or any lending office or such
         holding company) of its Commitment or Loans hereunder, resulting from the implementation of any
         risk-based capital guideline, reserve requirement or other similar requirement hereafter issued by
         any Governmental Authority pursuant to any law or regulation or any interpretation, application,
         directive or request (whether or not having the force of law and whether or not failure to comply
         therewith would be unlawful so long as compliance therewith is standard banking practice in the
         relevant jurisdiction) (including, without limitation, implementing at the national level any
         Regulatory Change of the Basel Accord), the effect of which would be to reduce the return on
         investment of assets or equity in respect of its Commitments or Loans, including, without
         limitation, any such reduction attributable to any funding arrangements utilized in connection
         with the Loans; such compensation shall include, without limitation, an amount equal to any
         reduction of the rate of return on assets or equity of such Lender (or any lending office or such
         bank holding company) could have achieved but for such law, regulation, interpretation, directive
         or request.  For purposes of this Section 10(h)(ii), "Basel Accord" shall mean the proposals for
         risk-based capital framework described by the Basel Committee on Banking Regulations and
         Supervisory Practices in its paper entitled "International Convergence of Capital Measurement and
         Capital Standards" dated July, 1988, it being understood that, as at the date hereof, there has
         been no Regulatory Change of the Basel Accord (i.e., "Basel II" has not been adopted).

(iii)    Any Lender (or the Administrative Agent on its behalf) shall notify the Borrower of any event occurring
         after the date hereof entitling such Lender to compensation under paragraph (i) or (ii) of this Section
         10(h) as promptly as practicable, but in any event within 60 days, after such Lender obtains actual
         knowledge thereof; provided that (A) such Lender shall, with respect to compensation payable
         pursuant to this Section 10(h) in respect of any Additional Costs resulting from such event, only
         be entitled to payment under this Section 10(h) for Additional Costs incurred from and after the
         date that is 60 days prior to the date such Lender (or the Administrative Agent on its behalf)
         does give such notice and (B) such Lender will use commercially reasonable efforts (at the
         Borrower's expense) to mitigate the amount of the Additional Costs associated with such event,
         including designating a different lending office for the Notes of such Lender affected by such
         event if such designation will avoid the need for, or reduce the amount of, such compensation and
         will not, in the sole opinion of such Lender, result in any economic, legal or regulatory
         disadvantage to such Lender (other than economic disadvantages for which the Borrower agrees to
         indemnify such Lender and which indemnity is acceptable to such Lender in its discretion acting
         reasonably based on its credit assessment of the Borrower).  Any such Lender (or the
         Administrative Agent on its behalf) will furnish to the Borrower an officer's certificate setting
         forth in reasonable detail (x) the events giving rise to such Additional Costs, (y) the basis for
         determining and allocating such Additional Costs and (z) the amount of each request by such Lender
         for compensation under paragraph (i) or (ii) of this Section 10(h) (subject, however, to any
         limitations such Lender may require in respect of disclosure of confidential information relating
         to its capital structure), together with a statement that the determinations and allocations made
         in respect of the Additional Costs comply with the provisions of this Section 10(h), including as
         provided in the last proviso of this paragraph (iii).  Determinations and allocations by any such
         Lender for purposes of this Section 10(h) of the effect of any Regulatory Change pursuant to
         paragraph (i) of this Section 10(h), or of the effect of capital maintained pursuant to
         paragraph (ii) of this Section 10(h), on its costs or rate of return of maintaining Notes or its
         funding, or on amounts receivable by it in respect of Notes, and of the amounts required to
         compensate such Lender under this Section 10(h), shall be conclusive absent manifest error,
         provided that such determinations and allocations are made on a reasonable basis and, in the case
         of allocations, are made fairly.

(iv)     If a Lender gives notice of a claim against the Borrower under this Section 10(h), the Borrower shall have
         the right (i) to require such Lender to sell its Notes to an institution designated by the Borrower in
         compliance with Section 24(c)(iii) of this Agreement for an amount equal to the outstanding principal amount
         thereof plus accrued interest thereon to the date of sale, together with the Break Amount and all
         other amounts owing thereto, if any, or (ii) to prepay the outstanding principal amount of Notes
         held by such Lender, together with accrued interest to the date of such prepayment and Break
         Amount, if any, and all other amounts owing thereto.

(v)      The Borrower shall not be required to make payments under this Section 10(h) to any Lender if (A) a claim
         hereunder arises solely through circumstances peculiar to such Lender and which do not affect commercial
         lenders similar to such Lender in the jurisdiction of organization of such Lender generally or (B) the
         claim arises out of a voluntary relocation by such Lender of its lending office (it being
         understood that any such relocation effected pursuant to Section 10(h)(iii)(B) is not
         "voluntary"), or (C) such Lender is required by the Borrower pursuant to Section 10(h)(iv) above to
         sell its Notes to a purchaser designated by the Borrower and fails to do so.

(vi)     Amounts payable by the Borrower under this Section 10(h) shall be payable by the Borrower within 30 days
         of demand therefor.

Section 11.       Events Of Default; Certain Rights of Administrative Agent.  (a)  Each of the following
events shall constitute an Event of Default (whether any such event shall be voluntary or involuntary or come about
or be effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):

(i)      The Borrower shall have failed to make a payment of any principal or interest due on any Note within five
         Business Days after the same shall have become due; or

(ii)     The Borrower shall have failed to make any payment of any amount hereunder or under the Operative Documents
         other than principal and interest on the Loan after the same shall have become due and such failure shall
         continue for ten Business Days after the Borrower's receipt of written demand therefor by the
         party entitled thereto; or

(iii)    The Borrower shall fail to procure and maintain (or cause to be procured and maintained), with respect to the
         Aircraft, insurance required to be maintained in accordance with the provisions of Article VI of the
         Mortgage or such insurance shall lapse or be canceled; or

(iv)     The Borrower shall have failed to perform or observe, or caused to be performed and observed, any other
         covenant or agreement to be performed or observed by it under any Operative Document, and such failure shall
         continue unremedied for a period of thirty (30) days after the Borrower's receipt of written
         notice thereof from the Administrative Agent or the Lenders; or

(v)      Any representation or warranty made by the Borrower in any Operative Document or any document or certificate
         furnished by the Borrower in connection therewith or pursuant thereto shall prove to have been incorrect,
         untrue, inaccurate or misleading in any respect that is materially adverse to the Lenders or the
         Administrative Agent in such party's reasonable judgment at the time made and shall remain
         material; or

(vi)     The commencement by the Borrower of a voluntary case under the federal bankruptcy laws, as now constituted
         or hereafter amended, or any other applicable federal or state bankruptcy, insolvency or other similar law in
         the United States, or the consent by the Borrower to the appointment of or taking possession by a
         receiver, liquidator, trustee, custodian, sequestrator (or other similar official) of the Borrower
         or for all or substantially all of its property, or the making by the Borrower of any assignment
         for the benefit of creditors or the Borrower shall take any corporate action to authorize any of
         the foregoing or to authorize a general payment moratorium; or

(vii)    The commencement of an involuntary case or other proceeding in respect of the Borrower under the federal
         bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy,
         insolvency or other similar law in the United States or seeking the appointment of a receiver, liquidator,
         custodian, trustee, sequestrator (or similar official) of the Borrower or for all or substantially
         all of its property, or seeking the winding-up or liquidation of its affairs and the continuation
         of any such case or other proceeding remains undismissed and unstayed for a period of sixty (60)
         consecutive days, or an order, judgment or decree shall be entered in any proceeding by any court
         of competent jurisdiction appointing, without the consent of the Borrower, a receiver, trustee or
         liquidator of the Borrower, or for all or substantially all of its property, or sequestering of
         all or substantially all of the property of the Borrower and any such order, judgment or decree or
         appointment or sequestration shall be final or shall remain in force undismissed, unstayed or
         unvacated for a period of sixty (60) consecutive days after the date of entry thereof; or

(viii)   The Borrower fails or ceases to be a U.S. Air Carrier or shall have been suspended as a U.S. Air Carrier or
         shall otherwise no longer have all applicable licenses (or such licenses shall be suspended) necessary to
         operate as a commercial airline; or

(ix)     Immediately upon such time as the Mortgage ceases to create a valid, perfected first priority mortgage on
         the Airframe or Engine in favor of the Administrative Agent for any reason other than the failure of the
         Lenders to cause continuation statements to be filed to the extent required by the Uniform Commercial Code
         or the filing by or on behalf of the Lenders of a termination statement releasing the Airframe or
         Engine from the Lien of the Mortgage; or

(x)      An "Event of Default" shall have occurred and be continuing under (as defined in) the Related Credit Agreement
         or a "Lease Event of Default" shall have occurred and be continuing under (and as defined in) any Lease
         Transaction; or

(xi)     (i)  The Borrower shall default in the payment when due of any principal of or interest on, or fail to make
         a scheduled rental payment on, any of its other indebtedness or any lease obligation; or (ii) any event
         specified in any note, agreement, indenture, lease or other document evidencing or relating to any
         indebtedness or any lease obligation shall occur, and, after giving effect to any applicable
         notice and/or grace periods, the effect of such default (in the case of clause (i)) or event (in
         the case of clause (ii)) is to cause, or to permit the holder or holders of such indebtedness or
         lease obligation (or a trustee or agent on behalf of such holder or holders) to cause, such
         indebtedness or lease obligation to become due or to be terminated, or to be prepaid in full
         (whether by redemption, purchase, offer to purchase or otherwise), prior to its stated maturity;
         provided that, (x) the outstanding amount of such indebtedness and (y) the capitalized amount of
          such lease obligation shall, singly or in the aggregate, be in excess of $10,000,000.

(b)      Certain Rights of Administrative Agent.  (i)  In anticipation of receipt from Borrower of payment of
sums due and owing hereunder or under any Operative Document, the Administrative Agent shall have the option, but
shall not be obligated to, advance to the Lenders on any Interest Payment Date, as provided in Section 10(a) hereof,
an amount equal to that required to be paid to the Lenders by the Borrower on such Interest Payment Date.

(ii)     The Administrative Agent shall not, as a result of exercising its option to make the advance described in
         Section 11(b)(i) above, obtain any Lien on the Mortgage Estate for or on account of costs or expenses
         incurred in connection with the exercise of such right, nor shall any claim of the Administrative Agent
         against the Borrower or any other party for the repayment of such costs or expenses impair the
         prior right and security interest of the Administrative Agent (on behalf of the Lenders) in and to
         the Mortgage Estate.  Upon any advance by the Administrative Agent to the Lenders as provided in
         Section 11(b)(i), the Administrative Agent shall be subrogated to the rights of the Lenders in
         respect of any late payment made by Borrower and interest at the Past Due Rate payable by the
         Borrower on account of its being overdue (but shall have no rights as a secured party hereunder),
         and thereafter, the Administrative Agent shall be entitled to receive such overdue payment and
         such interest; provided, that the Administrative Agent shall not be entitled to seek recovery of
         any such advance (or any payment in lieu thereof) except pursuant to the foregoing right of
         subrogation.

Section 12.       Remedies.  (a)  General; Acceleration.  (i)  If an Event of Default shall have occurred
and be continuing and so long as the same shall be continuing, then and in every such case,  the Administrative Agent
may exercise any or all of the rights and powers and pursue any and all of the remedies pursuant to this Section 12 and
shall have and in addition, may exercise all of the rights and remedies of a secured party under the
Uniform Commercial Code.

(ii)     If an Event of Default referred to in Sections 11(a)(vi) or (vii) shall have occurred, then and in every
         such case (x) the Commitments shall automatically be cancelled and (y) the unpaid principal of all Notes then
         outstanding, together with interest accrued but unpaid thereon, and all other amounts due to the
         Lenders thereunder and hereunder and under the other Operative Documents, shall, unless the
         Administrative Agent, acting upon the instructions of the Lenders shall otherwise direct,
         immediately and without further act become due and payable, without presentment, demand, protest
         or notice, all of which are hereby waived.

(iii)    If any other Event of Default shall have occurred and be continuing, then and in every such case, the
         Administrative Agent may at any time, by written notice or notices to the Borrower, (x) cancel the Commitments
         and/or (y) declare all the Notes to be due and payable, whereupon the Commitments shall be cancelled and
         the unpaid principal of all Notes then outstanding, together with interest accrued but unpaid
         thereon, and all other amounts due to the Lenders thereunder, hereunder and under the other
         Operative Documents, shall immediately and without further act become due and payable without
         presentment, demand, protest or other notice, all of which are hereby waived.

(iv)     If the principal of the Notes shall have become due and payable pursuant to this Section 12(a), there shall
         also become due and payable, to the fullest extent permitted by law, to the Lenders upon demand, without
         presentment, protest or notice, all of which are hereby waived, the Break Amount and Additional
         Costs (if any) therefor.

(v)      The Lenders shall be entitled, at any sale pursuant to this Section 12, to credit against any purchase price
         bid at such sale by the Lenders all or any part of the unpaid obligations owing to the Lenders and secured by
         the Lien of the Mortgage.  The Administrative Agent and the Lenders shall, upon any such purchase,
         acquire good title to the property so purchased, to the extent permitted by applicable law, free
         of all rights of redemption.

(vi)     The Administrative Agent agrees to give to the Borrower at least ten days' prior written revocable notice of
         any foreclosure of the Lien of the Mortgage, or of any other action to cause the Borrower to lose its title
         in the Aircraft (which period of notice the parties hereto confirm is commercially reasonable).

(b)      Repossession and Sale.  At any time during the continuation of an Event of Default, the Administrative
Agent in addition to any rights it might otherwise have at law, may do either or both of the following:

(i)      Upon the written demand of the Administrative Agent, and at the Borrower's expense, cause the Borrower to
         return promptly, and the Borrower shall return promptly, all or any part of the Aircraft as the Administrative
         Agent may so demand, to the Administrative Agent at a major airport on the Borrower's route system
         in one of the forty eight (48) contiguous states of the United States of America chosen by the
         Administrative Agent in the manner and condition required by Section 3.01 of the Mortgage, or,
         alternatively, the Administrative Agent at its option, may, to the extent permitted by law,
         peaceably enter upon the premises where all or any part of the Aircraft is located and take
         immediate possession of and remove the same by summary proceedings or otherwise (and, at the
         Administrative Agent's option store the same at the Borrower's premises until disposal thereof by
         the Administrative Agent), all without liability accruing to the Administrative Agent for or by
         reason of such entry or taking of possession or removal so long as the Administrative Agent has
         acted in accordance with the provisions of the Mortgage; provided that during any period the
           Aircraft is activated under CRAF in accordance with the provisions of Section 3.03 of the Mortgage
         and in the possession of the government of the United States of America or an instrumentality or
         agency thereof, the Administrative Agent shall not, on account of any Event of Default, be
         entitled to do any of the following in such manner as to limit the Borrower's control under the
         Mortgage of the associated Airframe or any Engines installed thereon, unless at least sixty (60)
         days' (or such lesser period as may then be applicable under the Military Airlift Command program
         of the government of the United States of America) prior written notice of default hereunder shall
         have been given by the Administrative Agent by registered or certified mail to the Borrower with a
         copy addressed to the Contracting Office Representative for the Military Airlift Command of the
         United States Air Force under the contract with the Borrower relating to the Aircraft; or

(ii)     with or without taking possession thereof, sell all or any part of the Aircraft at public or private sale,
         as the Administrative Agent may determine, or otherwise dispose of, hold, use, operate or lease to
         others, as the Administrative Agent, in its sole discretion, may determine, all free and clear of
         any rights of the Borrower, except as hereinafter set forth in this Section 12.

                  In addition, the Borrower shall be liable, except as otherwise provided above and without
duplication of amounts payable hereunder, for any and all reasonable and actual legal fees and other costs
and expenses incurred by the Administrative Agent and the Lenders in connection with the enforcement of any
of their respective rights and remedies hereunder.

                  At any sale of the Aircraft or any part thereof pursuant to this Section 12, the
Administrative Agent on the Lenders' behalf, may bid for and purchase such property.  The Administrative
Agent on the Lenders' behalf, agrees to give the Borrower at least ten days' written notice of the date
fixed for any public sale of the Airframe or any Engine or of the date on or after which will occur the
execution of any contract providing for any private sale (together with details thereof).  Except as
otherwise expressly provided above, no remedy referred to in this Section 12 is intended to be exclusive,
but each shall be cumulative and in addition to any other remedy referred to above or otherwise available
to the Administrative Agent at law or in equity; and the exercise or beginning of exercise by the
Administrative Agent of any one (1) or  more of such remedies shall not preclude the simultaneous or later
exercise by the Administrative Agent of any or all of such other remedies.  No express or implied waiver by
the Administrative Agent of any Event of Default shall in any way be, or be construed to be, a waiver of
any future or subsequent Event of Default.

(c)      Taking of Aircraft.  (i)  If an Event of Default shall have occurred and be continuing, at the request
of the Administrative Agent, the Borrower shall promptly execute and deliver to the Administrative Agent such
instruments of title and other documents as the Administrative Agent may deem necessary or advisable to enable the
Administrative Agent or an agent or representative designated by the Administrative Agent, at such time or
times and place or places as the Administrative Agent may specify, to obtain possession of all or any part
of the Mortgage Estate to which the Administrative Agent shall at the time be entitled hereunder.  If the
Borrower shall for any reason fail to execute and deliver such instruments and documents after such request
by the Administrative Agent, the Administrative Agent may (A) obtain a judgment conferring on the
Administrative Agent the right to immediate possession and requiring the Borrower to execute and deliver
such instruments and documents to (or as delivered by) the Administrative Agent, to the entry of which
judgment the Borrower hereby specifically consents, and (B) pursue all or part of the Mortgage Estate
wherever such Mortgage Estate may be found and may peaceably enter any of the premises of the Borrower
wherever it may be or be supposed to be and search for and take possession of and remove the same.  All
expenses of obtaining such judgment or of pursuing, searching for and taking such property shall, until
paid, be secured by the Lien of the Mortgage.

(ii)     Upon every such taking of possession, the Administrative Agent may, from time to time, at the expense of
         the Mortgage Estate, make all such expenditures for maintenance, insurance, repairs, replacements,
         alterations, additions and improvements to and of the Mortgage Estate, as it may deem proper.  In each such
         case, the Administrative Agent shall have the right to maintain, use, operate, store, lease,
         control or manage the Mortgage Estate and to carry on the business and to exercise all rights and
         powers of the Borrower relating to the Mortgage Estate, as the Administrative Agent shall deem
         best, including the right to enter into any and all such agreements with respect to the
         maintenance, insurance, use, operation, storage, leasing, control, management or disposition of
         the Mortgage Estate or any part thereof as the Administrative Agent may determine; and the
         Administrative Agent shall be entitled to collect and receive directly all tolls, rents, revenues,
         issues, income, products and profits of the Mortgage Estate and every part thereof.  Such tolls,
         rents, revenues, issues, income, products and profits shall be applied to pay the expenses of the
         use, operation, storage, leasing, control, management or disposition of the Mortgage Estate and of
         conducting the business thereof, and of all maintenance, repairs, replacements, alterations,
         additions and improvements, and to make all payments which the Administrative Agent may be
         required or may elect to make, if any, for taxes, assessments, insurance or other proper charges
         upon the Mortgage Estate or any part thereof (including the employment of engineers and
         accountants to examine, inspect and make reports upon the properties and books and records of the
         Borrower), and all other payments which the Administrative Agent may be required or authorized to
         make under any provision of the Mortgage, as well as just and reasonable compensation for the
         services of the Administrative Agent pursuant to this Section 12(c)(ii), and of all persons
         properly engaged and employed by the Administrative Agent.

(d)      Discontinuance of Proceedings.  In case the Administrative Agent (on its own behalf, or on behalf
of the Lenders) shall have instituted any proceeding to enforce any right, power or remedy under the Mortgage by
foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason or
shall have been determined adversely to the Administrative Agent, then and in every such case, the Administrative
Agent and the Borrower shall, subject to any determination in such proceedings, be restored to their former positions
and rights hereunder with respect to the Mortgage Estate, and all rights, remedies and powers of the
Administrative Agent shall continue as if no such proceedings had been instituted.

(e)      Waiver of Past Defaults.  The Administrative Agent, upon written instructions from the Majority
Lenders, shall waive any past Default or Event of Default hereunder and its consequences and upon any such waiver
such Default or Event of Default shall cease to exist and any Event of Default arising therefrom shall be deemed
to have been cured for every purpose of this Agreement, but no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any right consequent thereon.

(f)      Remedies Cumulative.  Each and every right, power and remedy given to the Administrative Agent or the
Lenders specifically or otherwise herein shall be cumulative and shall be in addition to every other right, power
and remedy herein specifically given or now or hereafter existing at law, in equity or by statute, and each and every
right, power and remedy whether specifically herein given or otherwise existing may be exercised from time
to time and as often and in such order as may be deemed expedient by the Administrative Agent or the
Lenders and the exercise or the beginning of the exercise of any power or remedy shall not be construed to
be a waiver of the right to exercise at the same time or thereafter any other right, power or remedy.  No
delay or omission by the Administrative Agent or the Lenders in the exercise of any right, remedy or power
or in the pursuit of any remedy shall impair any such right, power or remedy or be construed to be a waiver
of any default on the part of the Borrower or to be an acquiescence therein.

(g)      Payment After Event of Default, etc.  All payments received and amounts held or realized by the
Administrative Agent after an Event of Default shall have occurred and so long as such Event of Default shall be
continuing, and after the Notes shall have been accelerated pursuant to Section 12(a) hereof or after the Lenders
or the Administrative Agent shall foreclose or enforce the Mortgage or after the Notes shall have become due and
payable as provided in Section 12(a)(ii) or (iii), as well as all payments or amounts then held by the
Administrative Agent as part of the Mortgage Estate, shall be promptly distributed by the Administrative
Agent in the following order of priority:

                  first, so much of such payments or amounts as shall be required to reimburse the
         Administrative Agent for any tax, expense, charge or other loss (including, without limitation,
         all amounts to be expended at the expense of, or charged upon the tolls, rents, revenues, issues,
         income, products and profits of, the property included in the Mortgage Estate pursuant to
         Section 12(c)(ii)) incurred by the Administrative Agent (to the extent not previously reimbursed)
         (including, without limitation, the expenses of any sale, taking or other proceeding, reasonable
         attorneys' fees and expenses, court costs, and any other expenditures incurred or expenditures or
         advances made by the Administrative Agent, in the protection, exercise or enforcement of any
         right, power or remedy or any damages sustained by the Administrative Agent, liquidated or
         otherwise, upon such Event of Default) shall be applied by the Administrative Agent in
         reimbursement of such expenses;

                  second, so much of such payments or amounts remaining as shall be required to pay in full
         to the Lenders all amounts payable thereto pursuant to any other Operative Document and secured
         hereunder (other than amounts payable pursuant to clause "third" of this Section 12(g)) to the
         Lenders and remaining unpaid, including Break Amount and Additional Costs, shall be distributed to
         such Persons, and if the aggregate amount remaining shall be insufficient to pay all such amounts
         in full, it shall be distributed ratably, without priority of such person over any other;

                  third, so much of such payments or amounts remaining as shall be required to pay in full
         the aggregate unpaid principal amount of and all accrued but unpaid interest to the date of
         distribution on, the Notes shall be distributed to the Lenders, and if the aggregate amount
         remaining shall be insufficient to pay all such amounts in full, it shall be distributed ratably,
         without priority of any such person over any other, in the proportion that the principal amount of
         and all accrued but unpaid interest to the date of distribution on, each Note bears to the
         aggregate principal amount of and all accrued but unpaid interest to the date of distribution on
         all Notes;

                  fourth, so much of such payments or amounts remaining or shall be required to pay
         in full the amounts owing to the Related Lenders and the Related Administrative Agent under the Related
         Operative Documents in accordance with Section 12(g) of the Related Credit Agreement; and

                  fifth, the balance, if any, of such payments or amount remaining thereafter shall be
         distributed to the Borrower or as a court of competent jurisdiction shall direct.

Section 13.       Replacement Engines.  (a)  Replacement Engines.  At any time and from time
to time, any Engine which has been (or is to be treated as if the same had been) subject to an Event of Loss and
may be replaced under Section 5.02 of the Mortgage by a Replacement Engine shall be replaced in accordance with the
provisions of this Section 13(a) and the Borrower shall, from time to time, direct the Administrative Agent to
execute and deliver to or as directed in writing by an appropriate instrument releasing such Engine from the Lien of
the Mortgage, the Administrative Agent on behalf of the Lenders shall execute and deliver such instrument
as aforesaid, but only upon receipt by or deposit with the Administrative Agent of the following:

(i)      A written request from the Borrower, requesting such release and specifically describing the Engine(s) so
         to be released.

(ii)     A certificate signed by a duly authorized officer of the Borrower stating the following with respect to the
         replacement of any Engine:

(A)      the fair market value of the Replacement Engine as of the date of such certificate (which value shall not be
                  less than the then fair market value of the Engine requested to be released, assuming such Engine
                  was in the condition and repair required to be maintained (but without regard to hours and
                  cycles until overhaul));

(B)      the fair market value of the Engine to be released (immediately prior to the date such Engine suffered an
                  Event of Loss);

(C)      that the release of the Engine so to be released will not impair the security of the Mortgage or be in
                  contravention of any of the provisions of the Mortgage;

(D)      that each of the conditions specified in Section 5.02 of the Mortgage with respect to such Replacement
                  Engine have been satisfied; and

(E)      that the Replacement Engine was first placed in service after October 22, 1994.

(b)      Mortgage Supplements for Replacements.  In the event of a Replacement Engine being substituted as
contemplated by Section 5.02 of the Mortgage, the Borrower and the Administrative Agent agree for the benefit of the
Lenders, subject to fulfillment of the conditions precedent and compliance by the Borrower with its
obligations set forth in Section 5.02 of the Mortgage and the requirements of Section 13(a) with respect to
such Replacement Engine, to execute and deliver a Mortgage Supplement with respect thereto as contemplated
by Section 5.02 of the Mortgage, and, provided no Default or Event of Default in each case under Section 11
hereof shall have occurred and be continuing, to execute and deliver to the Borrower an appropriate
instrument releasing the Engine being replaced from the Lien of the Mortgage (which may be the Mortgage
Supplement that adds the Replacement Engine to the Mortgage).

(c)      Effect of Replacement.  In the event of the substitution of a Replacement Engine pursuant to Section
5.02 of the Mortgage and Section 13(a) hereof, all provisions of this Agreement and the Mortgage relating to an
Engine or Engines being replaced shall be applicable to such Replacement Engine or Engines with the same force and
effect as if such Replacement Engine or Engines were the same engine or engines as the Engine or Engines
being replaced but for the Event of Loss with respect to an Engine or Engines being replaced.

Section 14.       The Administrative Agent.  (a)  Appointment, Powers and Immunities.  Each Lender hereby appoints
and authorizes Landesbank Schleswig-Holstein Girozentrale ("LB Kiel") to act as its Administrative Agent hereunder
and under the other Operative Documents with such powers as are specifically delegated to the Administrative
Agent by the terms of this Agreement and of the other Operative Documents, together with such other powers
as are reasonably incidental thereto.  The Administrative Agent shall take all actions delegated to it
hereunder as an agent solely for the benefit of the Lenders.  The Administrative Agent (which term as used
in this sentence and in Section 14(c) and the first sentence of Section 14(f) hereof shall include
reference to its Affiliates and its own and their Affiliates' officers, directors, employees and agents, or
either of them):  (i) shall have no duties or responsibilities except those expressly set forth in this
Agreement and in the other Operative Documents, and shall not by reason of this Agreement or any other
Operative Document be a trustee for the Lenders; (ii) shall not be responsible to the Lenders for any
recitals, statements, representations or warranties contained in this Agreement or in any other Operative
Document, or in any certificate or other document referred to or provided for in, or received by any of
them under, this Agreement or any other Operative Document, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement, any Note or any other Operative Document or
any other document referred to or provided for herein or therein or for any failure by the Borrower or any
other Person to perform any of its obligations hereunder or thereunder; (iii) shall not be required to
initiate or conduct any litigation or collection proceedings hereunder or under any other Operative
Document; (iv) shall not be responsible to the Lenders for any action taken or omitted to be taken by it
hereunder or under any other Operative Document or under any other document or instrument referred to or
provided for herein or therein or in connection herewith or therewith, except for its own gross negligence
or willful misconduct; and (v) may be removed from its role as Administrative Agent by the Lenders with or
without cause and upon notice by Lenders to the Borrower.  The Administrative Agent shall not assign its
interest to any replacement agent who is not a bank or financial institution with a net worth (or capital
and surplus, as the case may be) in excess of $500,000,000 without the Borrower's prior written consent,
such consent not to be unreasonably withheld.  The Administrative Agent may employ agents and
attorneys-in-fact and shall not be responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith.

(b)      Reliance by the Administrative Agent.  The Administrative Agent shall be entitled to rely upon any
certification, notice or other communication (including, without limitation, any thereof by telephone, telecopy,
telex, telegram or cable) believed by it to be genuine and correct and to have been signed or sent by or on behalf
of the proper Person or Persons, and upon advice and statements of legal counsel, independent accountants and
other experts selected by the Administrative Agent.  As to any matters not expressly provided for herein or
in any other Operative Document, the Administrative Agent shall in all cases be fully protected in acting,
or in refraining from acting, hereunder or thereunder in accordance with instructions given by the Majority
Lender or all of the Lenders, as the case may be, as is required in such circumstance, and such
instructions of such Lender and any action taken or failure to act pursuant thereto shall be binding on all
of the Lenders.

(c)      Defaults.  The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence
of a Default (other than the non-payment of principal of or interest on Notes) unless the Administrative Agent have
received notice from the Lenders or the Borrower specifying such Default and stating that such notice is a "Notice
of Default".  In the event that the Administrative Agent receives such a notice of the occurrence of a
Default, the Administrative Agent shall give prompt notice thereof to the Lenders (and shall give the
Lenders prompt notice of each such non-payment).  The Administrative Agent shall (subject to Section 16(a)
hereof) take such action with respect to such Default as shall be directed by the Majority Lenders,
provided that, unless and until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default as it shall deem advisable in the best interest of the Lenders except
to the extent that this Agreement expressly requires that such action be taken, or not be taken, only with
the consent or upon the authorization of the Majority Lenders.

(d)      Rights as Administrative Agent.  LB Kiel (and any successor acting as Administrative Agent) and its
affiliates may (without having to account therefor to the Lenders) accept deposits from, lend money to, make
investments in and generally engage in any kind of loan, trust or other business with the Borrower (and any of its
subsidiaries or Affiliates) as if it were not acting as the Administrative Agent, and LB Kiel and its
affiliates may accept fees and other consideration from the Borrower for services in connection with this
Agreement or otherwise without having to account for the same to the Lenders.

(e)      Failure to Act.  Except for action expressly required of the Administrative Agent hereunder and under
the other Operative Documents, the Administrative Agent shall in all cases be fully justified in failing or refusing
to act hereunder and thereunder unless it shall receive indemnification against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take any such action.

(f)      Resignation or Removal of the Administrative Agent.  Subject to the appointment and acceptance of a
successor Administrative Agent as provided below, and subject further to the penultimate sentence of this Section
14(f), the Administrative Agent may resign at any time by giving notice thereof to the Lenders and the Borrower,
and the Administrative Agent may be removed at any time with or without cause by the Majority Lenders.  Upon
any such resignation or removal, the Majority Lenders shall have the right to appoint a successor
Administrative Agent.  If no successor Administrative Agent shall have been so appointed by the Majority
Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent's
giving of notice of resignation or the Lenders' removal of the retiring Administrative Agent, then the
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent.
Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent or shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder.  After any retiring Administrative
Agent's resignation or removal hereunder as Administrative Agent, the provisions of this Section 14 shall
continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it
was acting as the Administrative Agent.  The Administrative Agent shall not assign its interest to any
replacement agent who is not a bank or financial institution with a net worth (or capital and surplus, as
the case may be) in excess of $500,000,000 without the Borrower's prior written consent, such consent not
to be unreasonably withheld.

(g)      Consents under Operative Documents.  Except as otherwise provided in Section 16(a) hereof, the
Administrative Agent may, with the prior consent of the Majority Lenders (but not otherwise), consent to any
modification, supplement or waiver under any of the Operative Documents, provided that, without the prior consent
of each Lender, the Administrative Agent shall not (except as provided herein) release any collateral or otherwise
terminate any Lien under any Operative Document providing for collateral security, or agree to additional
obligations being secured by such collateral security (unless the Lien for such additional obligations
shall be junior to the Lien in favor of the other obligations secured by such Operative Document), except
that no such consent shall be required, and the Administrative Agent is hereby authorized, to release any
Lien covering property which is the subject of a disposition of property permitted hereunder or to which
the Lenders have consented.

(h)      Non-Receipt of Funds by the Administrative Agent.  Unless the Administrative Agent shall have been
notified by the Lenders or the Borrower (the "Payor") prior to the date on which the Payor is to make payment
to the Administrative Agent of (in the case of the Lenders) the proceeds of a Loan to be made by it hereunder or
(in the case of the Borrower) a payment to the Administrative Agent for account of one or more of the Lenders
hereunder (such payment being herein called the "Required Payment"), which notice shall be effective upon receipt,
that the Payor does not intend to make the Required Payment to the Administrative Agent, the Administrative
Agent may assume that the Required Payment has been made and may, in reliance upon such assumption (but
shall not be required to), make the amount thereof available to the intended recipient(s) on such date and,
if the Payor has not in fact made the Required Payment to the Administrative Agent, the recipient(s) of
such payment shall, on demand, repay to the Administrative Agent the amount so made available together with
interest thereon in respect of each day during the period commencing on the date such amount was so made
available by the Administrative Agent until the date the Administrative Agent recovers such amount at a
rate per annum equal to the Federal Funds Rate for such day and, if such recipient(s) shall fail promptly
to make such payment, the Administrative Agent shall be entitled to recover such amount, from the Payor,
together with interest as aforesaid.

Section 15.       Investment Of Funds.  Any moneys held by the Administrative Agent as security hereunder for
Borrower's obligations shall, until paid to Borrower or otherwise applied in accordance with the terms of the
Operative Documents, be invested by the Administrative Agent as Borrower may from time-to-time direct in writing
(or orally and confirmed in writing), but subject to availability at the Administrative Agent's discretion (it
being understood that absent such a direction, there shall be no obligation to invest such moneys) in
(a) obligations of, or guaranteed by, the United States Government or agencies thereof, (b) open market
commercial paper of any corporation incorporated under the laws of the United States of America or any
State thereof rated at least "P-2" or its equivalent by Moody's or at least "A-2" or its equivalent by S&P,
(c) certificates of deposit issued by commercial banks organized under the laws of the United States or of
any political subdivision thereof having a combined capital and surplus in excess of $750,000,000 which
banks or their holding companies have a rating of A or its equivalent by Moody's or S&P; provided, however,
that the aggregate amount at any one time so invested in certificates of deposit issued by any one bank
shall not exceed five percent (5%) of such bank's capital and surplus, (d) Dollar denominated offshore
certificates of deposit issued by, or offshore time deposits with, any commercial bank described in (c) or
any subsidiary thereof, and (e) repurchase agreements with any financial institution having combined
capital and surplus of at least $750,000,000 with any of the obligations described in clauses (a) through
(d) as collateral, none of which investments (but exclusive of any underlying investment that may be
subject to a repo) shall have a term to maturity in excess of 30 days.  There shall be promptly remitted to
Borrower or its order (but no more frequently than monthly) any gain (including interest received) realized
as a result of any such investment (net or any, fees, commissions and other expenses, if any, incurred in
connection with such investment) unless a Special Default or an Event of Default shall have occurred and be
continuing.  The Borrower shall be responsible for any net loss realized as a result of any such investment
and shall reimburse the Administrative Agent on demand.

Section 16.       Supplements and Amendments to the Mortgage and Other Operative Documents.  (a)
Instructions of Lenders; Limitations.  (i) At any time and from time to time, at the request of the Borrower
the Administrative Agent (but only on the written direction or consent of the Majority Lenders) shall execute a
supplement to the Mortgage for the purpose of adding provisions to, or changing or eliminating provisions of, the
Mortgage as specified in such request, provided, however, that, without the consent of each Lender, no such
amendment of or supplement to any such document, or waiver or modification of the terms of any thereof, shall
(i) modify any of the provisions of this Section 16(a) or the definitions of the terms, "Majority Lenders"
or "Operative Documents", contained herein or in any other Operative Document, (ii) increase the principal
amount of any Note or reduce the amount or extend the time of payment of any amount owing or payable under
any Note or (except as provided in this Agreement) increase or reduce the Break Amount or interest payable
on any Note (except that only the consent of the Lender holding any Note shall be required for any decrease
in any amounts of or the rate of Break Amount or interest payable on such Note or any extension for the
time of payment of any amount payable under such Note), (iii) reduce, modify or amend any indemnities in
favor of any Lender or in favor of or to be paid by the Borrower or alter the definition of "Indemnitee" to
exclude any Lender (except as consented to by each Person adversely affected thereby), or (iv) release the
Borrower from its obligations in respect of the payment of the principal and interest then outstanding (or
other amounts payable therewith) or change any of the circumstances under which Stipulated Insured Amount
(or other amounts payable therewith) are payable.  This Section 16(a) shall not apply to any mortgage or
mortgages supplemental hereto permitted by, and complying with the terms of, Section 13(b).
Notwithstanding the foregoing, without the consent of each Lender, no such supplement to the Mortgage, or
waiver or modification of the terms thereof or of any other agreement or document shall expressly permit
the creation of any Lien on the Mortgage Estate or any part thereof, except as therein expressly permitted,
or deprive any Lender of the benefit of the Lien of the Mortgage on the Mortgage Estate, except as provided
in Sections 13(a) and 13(b) hereof or in connection with the exercise of remedies under Section 12 hereof.
Except as provided in this Section 16(a), the Administrative Agent shall not amend, supplement or waive any
of the terms of the Mortgage or this Agreement.

(b)      Administrative Agent Protected.  If, in the opinion of the institution acting as the Administrative Agent
hereunder any document required to be executed pursuant to the terms of Section 16(a) affects any right, duty,
immunity or indemnity with respect to it under the Mortgage, the Administrative Agent may in its discretion decline
to execute such document.

(c)      Documents Mailed to the Lenders.  Promptly after the execution by the Administrative Agent and the Lenders
of any document entered into pursuant to Section 16(a), the Administrative Agent shall mail, by certified mail, postage
prepaid, a conformed copy thereof to each Lender at its address shown on the Note Register, but the failure
of the Borrower or the Administrative Agent, to mail such conformed copies shall not impair or affect the
validity of such document.

Section 17.       Notices.  All notices, demands, instructions and other communications required or permitted to
be given to or made upon any party hereto shall be in writing and shall be personally delivered or sent by registered or
certified mail, postage prepaid, or by facsimile, or by prepaid courier service, and shall be effective upon receipt.

         Unless otherwise specified in a notice sent or delivered in accordance with the foregoing
provisions of this Section 17, notices, demands, instructions and other communications in writing shall be
given to or made upon the respective parties hereto at their respective addresses (or to their respective
telex address or facsimile numbers) as follows:  (a) if to the Borrower or the Administrative Agent, to the
respective addresses set forth in Section 7.06 of the Mortgage, (b) if to the Lenders, to the respective
addresses set forth on Schedule I hereto, or (c) if to any subsequent lender, addressed to such lender its
address set forth in the Note Register maintained pursuant hereto.

         Notwithstanding anything to the contrary contained herein or in any of the Operative Documents,
and for the avoidance of doubt, any notice required to be given by the Lenders hereunder or under any of
the Operative Documents may also be given by the Administrative Agent on the Lenders' behalf.  The
Administrative Agent agrees to give any notice so received to the Lenders.

Section 18.       Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.  (a)  This Agreement shall in all
respects be governed by, and construed in accordance with, the law of the State of New York, including all matters of
construction, validity and performance.

(b)      Each party hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of
any such action or proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court.  Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.  Nothing in this Agreement shall affect any right that any
party may otherwise have to bring any action or proceeding relating to this Agreement against another party
or its properties in the courts of any jurisdiction.

(c)      Each party hereby irrevocably and unconditionally waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any court referred to in paragraph (b) of this Section.
Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(d)      Each party to this Agreement irrevocably consents to service of process in the manner provided for notices
in Section 17. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any
other manner permitted by law.

(e)      EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY
IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, ADMINISTRATIVE AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO
THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

Section 19.       Costs and Expenses.  The Borrower shall reimburse the Administrative Agent and the
Lenders for all reasonable out-of-pocket expenses incurred by it in connection with the negotiation and preparation
of this Agreement and the other Operative Documents (including the reasonable fees and expenses of its special counsel);
provided that, if a Delivery Date fails to occur due to the fault of the Administrative Agent or any Lender
(including the failure to obtain any necessary credit approval), the Administrative Agent will be
responsible for its own costs and expenses (including legal fees and expenses); which costs and expenses
shall be limited, in the case of the failure of the second Delivery Date to occur, to the costs and
expenses incurred solely in connection with such second Delivery Date.  The Borrower is also liable for all
of its own out-of-pocket expenses incurred in connection with the negotiation, preparation and the carrying
out of its obligations under this Agreement and the other Operative Documents (including the reasonable
fees and expenses of all of its special counsel).

Section 20.       Section 1110 Compliance.  Notwithstanding any provision herein or elsewhere contained to
the contrary, it is understood and agreed among the parties hereto that the transactions contemplated by this Credit
Agreement, and the other Operative Documents are expressly intended to be, shall be and should be construed so as to
be, entitled to the full benefits of 11 U.S.C. Section 1110, as amended from time to time, and any
successor provision thereto.

Section 21.       Confidentiality.  Except to the extent otherwise required by applicable law or, as required
to be filed publicly with the Securities and Exchange Commission, or unless the Borrower, the Lenders and the
Administrative Agent shall otherwise consent in writing, each party to this Agreement agrees to maintain the
confidentiality of this Agreement (and all drafts hereof and documents ancillary hereto) in its
communications with third parties other than any Indemnified Party and not to disclose, deliver or
otherwise make available to any third party (other than its directors, officers, employees, rating
agencies, accountants or counsel or to bank examiners or other regulatory personnel) the original or any
copy of all or any part of this Agreement (or any draft hereof and documents ancillary hereto) except to an
Indemnified Party.

         None of the Borrower, the Administrative Agent, or any of their respective Affiliates shall issue
any news release or make any public announcement pertaining to the transactions contemplated by this
Agreement and the Operative Documents without the prior written consent of the other (which consent shall
not be unreasonably withheld) unless such news release or public announcement is required by applicable
law, in which case the parties shall consult with each other prior to the issuance of such news release or
public announcement.

         Notwithstanding anything herein, there is no restriction (either express or implied) on any
disclosure or dissemination of the tax structure or tax aspects of the transaction contemplated by the
Operative Documents.  Furthermore, each party hereto acknowledges that it has no proprietary rights to any
tax matters or tax idea contemplated by the Operative Documents or to any element of the transaction
structure contemplated by the Operative Documents.

Section 22.       Covenants of the Administrative Agent and the Lenders.  (a)  Quiet Enjoyment.
The Administrative Agent and each Lender each agrees that neither it nor any of its Affiliates, nor anyone acting on
behalf of any such Person will interfere in the Borrower's quiet enjoyment of the Aircraft so long as no Event of
Default shall have occurred and be continuing.

(b)      Lender Liens.  The Administrative Agent and each Lender hereby severally covenants and agrees with
each of the other parties hereto that so long as (i) it remains the Administrative Agent or a Lender, as the case
may be, and (ii) the Lien of the Mortgage on the Aircraft has not been released in accordance with the terms of the
Operative Documents, it will (x) take such action as may be necessary to discharge any Lender Liens, if
any, on the Aircraft attributable to it or any of its Affiliates and (y) indemnify and hold harmless the
other parties hereto from and against any loss, cost or expense which may be suffered or incurred by any
such Person as a result of its failure to discharge and satisfy any such Lender Lien.

(c)      Transfer Restrictions.  Each Lender covenants that (notwithstanding anything herein or in any other
Operative Document to the contrary) it will not transfer its Notes or any interest under any of the Operative
Documents unless the transferee makes the representation and warranty contained in Section 7(b).

Section 23.       Leveraged Lease Financing.  Notwithstanding any provision herein or elsewhere in
the Operative Documents to the contrary notwithstanding, the Borrower may elect, prior to the borrowing for the
Aircraft contemplated by Section 2(a) hereof, to finance the Aircraft as a leveraged lease financing and the
Lenders agree to such utilization of their Commitments for such purpose, subject to the satisfaction of the following
terms and conditions:

(a)      the Borrower shall provide at least 30 days' advance notice of its intention to effect such a financing,
which notice shall identify the equity investor (the "Owner Participant") and owner trustee ("Lessor");

(b)      the identified Owner Participant shall have a tangible net worth of at least $50,000,000 (or have its
obligations guaranteed by a parent corporation with such a tangible net worth level), shall be an active participant
in the aircraft leveraged lease industry and the identity of which (as well as that of the Lessor) shall be
reasonably satisfactory to the Lenders;

(c)      documentation for such transaction shall be in form and substance satisfactory to the Lenders and shall:

(i)      contain terms and conditions concerning the Borrower and the Aircraft no less favorable to the Lenders than
         those binding on the Borrower contained in the Operative Documents; and

(ii)     contain debt/equity provisions as are consistent with market practice and reasonably satisfactory to the
         Lenders, but shall not, without the consent of the Lenders, contain any swap breakage cap or other limitation
         relating to any swap hedging transaction or the ability of the Lenders to recover any swap hedging
         transaction or the ability of the Lenders to recover any swap breakage losses ahead of recoveries
         by the Owner Participant of its investment;

(d)      the economic substance (e.g., loan amount, interest rate, payment periodicity, maturity date, amortization
profile and LIBOR) of the leveraged lease debt funded by the Lenders shall be the same as that evidenced by the Notes
under the Mortgage; provided that

(i)      the level of indebtedness may be reduced in part; and

(ii)     the amortization profile on the leveraged lease debt may be based on an optimized leveraged lease basis so
         long as (x) the final maturity is no later than 12 years following the Delivery Date, (y) the average life
         of such debt does not exceed 8 years (computed as of the Delivery Date) and (z) such amortization profile
         shall otherwise be mutually agreed by the Borrower and the Lenders on a good faith basis; and

(e)      the Borrower shall pay to the Lenders (i) the reasonable fees and expenses of their special counsel in
connection with the negotiation, drafting (by such special counsel of the related indenture), execution and
delivery of the documentation utilized to effect such leveraged lease and (ii) any reasonable out-of-pocket
(including travel) costs and expenses of the Administrative Agent as a single representative for all of the Lenders
incurred in connection with the leveraged lease.

Section 24.       Miscellaneous.  (a)  The representations, warranties, indemnities and agreements of the
Borrower, the Administrative Agent and the Lenders and each party's obligations under any and all thereof, shall
survive the expiration or other termination of this Agreement or any other Operative Document, except as expressly
provided herein or therein.

(b)      This Agreement may be executed by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall together constitute but one and the
same instrument. Neither this Agreement nor any of the terms hereof may be terminated, amended, supplemented,
waived or modified, except by an instrument in writing signed by the party or parties thereto.

(c)      (i)               This Agreement shall be binding upon and shall inure to the benefit of, and shall be
enforceable by, the parties hereto and their respective successors and permitted assigns.

(ii)     The Borrower may not assign any of its rights or obligations under this Agreement or the other Operative
         Documents except to the extent expressly provided thereby.

(iii)    Subject to the provisions of clause (iv) below, any Lender may assign its Notes, in whole or in part,
         as provided hereunder and in Section 10(c) hereof, to any Person (including an Affiliate, another lender
         or other third party) which assignment shall be effected pursuant to an agreement substantially in the
         form of Exhibit B hereto.  In addition, any Lender may, with the prior written consent of the Borrower,
         assign, in whole or in part, its Commitment in respect of the Aircraft to any other Person capable
         of meeting its funding obligation in respect of the assigned Commitment, which assignment shall be
         effected pursuant to an agreement substantially in the form of Exhibit B hereto, appropriately
         modified to relate to the assignment of a Commitment.  Effective upon the assignment of any
         Commitment in accordance with this Section 24(c), such Lender shall be relieved of its obligations
         in respect of such Commitment to the extent the assignee thereof shall have become obligated in
         respect thereof.

(iv)     Any assignment or transfer by such Lender hereunder shall be subject to the following conditions:

(A)      The transferring Lender shall have first obtained the prior written consent of the Borrower, which consent
                  shall not be unreasonably withheld (provided that no such consent shall be required if an Event of
                  Default has occurred and is continuing), unless the proposed transferee is a Permitted
                  Transferee in which case no such consent of the Borrower shall be required;

(B)      The transferring Lender shall send the Borrower a written notice of such proposed transfer, setting forth
                  the name and address of the proposed transferee, the amount of the transferring Lender's Notes
                  proposed to be transferred and the proposed date on which such transfer will occur.
                  Other than in respect of a transfer to a Permitted Transferee, Borrower will then have
                  three (3) Business Days to request such additional information as it may reasonably
                  require regarding such proposed transferee, or, if no such additional information is
                  requested and such proposed transfer satisfies the other requirements of this
                  Section 24(c), the Borrower shall be deemed to have consented to such proposed transfer.
                  In the event that the Borrower requests additional information, it shall have three (3)
                  Business Days from the time such additional information is provided to reject such
                  proposed transfer, failing which, subject to satisfaction of the other requirements of
                  this Section 24(c), the Borrower shall be deemed to have given its consent;

(C)      as a result of any assignment or transfer, there shall be no more than three (3) lenders in the aggregate;

(D)      no such assignment or transfer shall be in an amount less than $5,000,000;

(E)      so long as no Event of Default shall have occurred or be continuing, no assignment or transfer shall, at
                  the time of such assignment or transfer, increase the obligations (including, without limitation,
                  in respect of withholding taxes or increased costs) of the Borrower under this Agreement or
                  the Mortgage; and

(F)      except as otherwise set forth herein, no participant in any Loan assigned or transferred hereunder shall
                  have any rights directly against the Borrower.

                  In the event a Lender, in accordance with this Section 24(c), assigns its interest in any
Loan, together with its interest herein and in the other Operative Documents, in each case to the extent
relating to such Loan, then all references to "the Lender" hereunder shall mean and refer to such assignee
to the extent of such assignment, and any subsequent assignment by such assignee shall have a corresponding
effect.

                  Subject always to the foregoing, this Agreement inures to the benefit of, and is binding
upon, the successors and assigns of the parties hereto.

(v)      Notwithstanding the foregoing, the Administrative Agent may not assign or transfer its rights or
         obligations hereunder or under the other Operative Documents without the prior written consent of the
         Lenders, such consent not to be unreasonably withheld.

(vi)     All costs and expenses in connection with any assignment or transfer permitted by this Section 24(c)
         (including any legal fees of counsel to the parties to the Operative Documents) shall be borne by
         the relevant transferring/assigning lender, except in the case of an assignment or transfer that
         is effected at the request of the Borrower or if an Event of Default shall have occurred and be
         continuing, in which case such costs and expenses (including reasonable legal fees) shall be borne
         by the Borrower.

(d)      No Lender shall have any obligation or duty to the Borrower, or to other Persons with respect to
the transactions contemplated hereby except those obligations or duties of such Lender expressly set forth
in this Agreement and the other Operative Documents, and no Lender shall be liable for performance by any
other party hereto of such other party's obligations or duties hereunder.  Without limitation of the generality
of the foregoing, under no circumstances whatsoever shall any Lender be liable to the Borrower for any action or
inaction on the part of the Administrative Agent in connection with the transactions contemplated herein,
whether or not such action or inaction is caused by willful misconduct or gross negligence of the
Administrative Agent.

Section 25.       Terms of Fixed Rate Setting.  (a)  The Lenders, at the Borrower's direction, shall
cause the Applicable Rate for the Loan to be a fixed rate effective for the period commencing on a date selected
by Borrower during the term of the Notes (the "Swap Effective Date") and ending on the final scheduled maturity
date of the Notes issued in respect of the Loan (the "Swap Period"); provided that if the proposed Swap Effective
Date is not an Interest Payment Date, the Borrower shall be liable for any LIBOR Break Amount.

(b)      If the Borrower desires the Applicable Rate to become a Fixed Rate, it shall give the Lenders at least
five Business Days' advance notice of such intention. By 9:30 a.m. (New York City time) on the date three Business
Days prior to the Swap Effective Date, each Lender shall quote to the Borrower the fixed rate of interest at which
such Lender would be willing to lend to the Borrower.  No later than two minutes after receipt of such
quotation, the Borrower shall inform each Lender whether it accepts or rejects such fixed rate quotation.
If such fixed rate quotation is accepted, such quoted fixed rate (the "Fixed Rate") shall be the Applicable
Rate hereunder. Each Lender agrees to provide its quotation of a Fixed Rate in accordance with market
practice based upon the Notional Swap Transaction and as though such Lender were the floating rate payor
thereunder.

(c)      In the event the Applicable Rate is the Fixed Rate, on the date of (i) any prepayment of the Notes
pursuant to the Mortgage or this Agreement (ii) any acceleration of the Notes pursuant to the Mortgage or this
Agreement, each Lender will provide a quotation of the Swap Break Amount, as it reasonably determines in good
faith in accordance with the definition thereof, representing the termination value of the Notional Swap
Transaction  by 12:00 noon New York City time on such date (the "Termination Date").

(d)      Each Lender agrees that, so long as no Special Default or Event of Default shall have occurred and be
continuing, it shall promptly pay to the Borrower at such account as the Borrower may specify any Swap Breakage
Gain in respect of the Notes, except that it may first deduct therefrom any amounts then due to it (or, if acting
as a swap agent, any Lender) under the Operative Documents and apply any amount so retained to the satisfaction
thereof.  At such time as there shall not be continuing any such Special Default or Event of Default, such
amount shall be paid to the Borrower.

(e)      Upon the request of the Borrower, each Lender shall provide to the Borrower a good faith estimate of the
Swap Breakage Loss or Swap Breakage Gain, as the case may be, related to the Notes, in connection with the
occurrence, or anticipated occurrence, of any event contemplated by the Operative Documents that might give rise
to an obligation to pay Swap Breakage Loss or Swap Breakage Gain.

(f)      Upon determination by a Lender of any Swap Breakage Loss or Swap Breakage Gain payable to or by it, as the
case may be, such Lender will provide to the Borrower a certificate, certifying such Swap Breakage Loss or Swap
Breakage Gain, which certified amount shall be conclusive absent manifest error.  Any Swap Breakage Loss or Swap
Breakage Gain payable pursuant to the terms of the Operative Documents shall be payable in Dollars.

(g)      Each Lender agrees to provide its quotation of Swap Break Amount based upon the Notional Swap Transaction
and as though such Lender were the floating rate payor thereunder.

(h)      References in this Section 25 to any Lender shall, to the extent appropriate, mean such Lender in its own
right or acting through a swap agent.

                                          [signature page follows]







         IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be duly executed by
their respective officers thereunto duly authorized as of the day and year first above written.

                                                           FRONTIER AIRLINES, INC.,
                                                           Borrower


                                                           By:_______________________________
                                                                Name:
                                                                Title:

                                                           LANDESBANK SCHLESWIG-HOLSTEIN
                                                           GIROZENTRALE,
                                                           Administrative Agent


                                                           By:_______________________________
                                                                Name:
                                                                Title:


                                                           By:_______________________________
                                                                Name:
                                                                Title:

                                                           LENDERS:


                                                           LANDESBANK SCHLESWIG-HOLSTEIN
                                                           GIROZENTRALE


                                                           By:_______________________________
                                                                Name:
                                                                Title:


                                                           By:_______________________________
                                                                Name:
                                                                Title:

                                                           COMMERZBANK INTERNATIONAL
                                                           S.A., LUXEMBOURG


                                                           By:_______________________________
                                                                Name:
                                                                Title:


                                                           By:_______________________________
                                                                Name:
                                                                Title:






                                                                                [Credit Agreement [Frontier/2002-A]]
                                                      SCHEDULE I

                                             Notice & Account Information

Lenders

Notice to:

Landesbank Schleswig-Holstein Girozentrale
Martensdamm 6,
D-24103 Kiel
Germany
Attention: Transportation Finance

Telephone: (49 431) 900 2979
Telecopier: (49 431) 900-1542

Payment Instructions

Bank Name: JP Morgan Chase Bank, New York
Acct. No.: [***]
ABA No.: [***]
SWIFT No.: [***]
Reference: 201, Frontier A319 No. 1


Commerzbank International S.A., Luxembourg
11, rue Notre-Dame
L-2013 Luxembourg
Attention: Edgar Geister, Credit Department

Telephone:  (352) 477-911-268
Telecopier:  (352) 477-911-386

Payment Instructions


Bank Name: Commerzbank AG New York
SWIFT Code: [***]
Account Name: Commerzbank AG, Frankfurt
SWIFT Code: [***]
In favor of: Commerzbank International S.A.
SWIFT Code: [***]
Account No.: [***]
Reference: Frontier Airlines

[***] Represents material that has been omitted and filed separately with the Securities and Exchange
Commission under a Confidental Treatment Request.






                                                                                [Credit Agreement [Frontier/2002-A]]

                                                      SCHEDULE II

                                          Participation in Original Amount

                                  [All amounts are expressed in millions of U.S. Dollars]

                                     % of
  Lender                        Original Amount              Commitment 

Landesbank Schleswig-
Holstein Girozentrale                 [***]%                         $[***]

Commerzbank
International S.A.,
Luxembourg                            [***]%                         $[***]


[***] Represents material that has been omitted and filed separately with the Securities and Exchange
Commission under a Confidental Treatment Request.




                                                                                [Credit Agreement [Frontier/2002-A]]
                                                       EXHIBIT A


                                                FORM OF BORROWING NOTICE

                                                    [LETTERHEAD OF BORROWER]

                                                                  _____________________, 2002

Landesbank Schleswig-Holstein Girozentrale


Ladies and Gentlemen:

         We refer to the Credit Agreement [Frontier/2002-A], dated as of June 26, 2002 (the "Credit
Agreement", which term, if such agreement shall not have been executed and delivered by the parties thereto
prior to the date hereof, shall mean the most recently circulated draft thereof), among Frontier Airlines,
Inc., as borrower (the "Borrower"), the lenders that are party thereto identified under the caption
"Lenders" on the signature pages thereto or that, pursuant to Section 24(c) thereof, shall become a "Lender"
thereunder (individually, a "Lender" and, collectively, the "Lenders") and Landesbank Schleswig-Holstein
Girozentrale, as Administrative Agent on behalf of the Lenders.  Capitalized terms used but not defined in
this Borrowing Notice shall have the meaning given such terms (whether by reference to another document or
otherwise) in the Credit Agreement.

         In accordance with Section 2 of the Credit Agreement, Borrower hereby requests that a Loan be
advanced by the Lenders on __________________ (the "Closing Date").  The Borrower elects Option [A/B].  The
Borrower advises that the Loan will initially bear interest at a [floating rate/fixed rate].  The Lenders
are directed to pay $__________ of the proceeds of the Commitment by wire transfer to the following account:

                                               Credit Lyonnais
                                                New York, NY
                                                  ABA #: [***]
                                                Account #: [***]
                                         Attention: William McIlwain
                                        Reference: Frontier MSN 1761

         Borrower agrees that it shall not postpone the Closing Date except as expressly agreed between the
parties in writing.  In the event of a postponement of the Closing Date or other reduction or modification
or termination of the related Loan, Borrower shall compensate Lenders upon written request by Lenders for
all losses, damages, liabilities and reasonable expenses (including any losses and expenses incurred on
account of funds borrowed, contracted for or utilized for purposes relating to the Loan or in connection
with the re-employment or reinvestment of such funds or an interruption of the use of such funds and
including interest or other such costs on funds borrowed until such funds are returned to their funding
source) that Lenders sustain as a result of (a) the failure of Borrower to borrow any part of the
Commitment of the Lenders, (b) the repayment or voluntary prepayment of any portion of the Loan, (c) the
failure of Borrower to prepay the Loan on a prepayment date, (d) the repayment or prepayment of any portion
of the Loan as a result of the exercise by the Administrative Agent or any Lender of its remedies following
the occurrence of an Event of Default, or (e) the repayment or prepayment of any portion of the Loan.
Compensation to the Lenders under this Borrowing Notice shall include interest at the Applicable Rate on
each Lender's Commitment from the Closing Date and any Break Amounts and Additional Costs or and other
amounts (other than interest) payable by each Lender to providers of funds obtained by each Lender in order
to make its Commitment, and costs incurred by each Lender in redeploying funds that were to be used by it
to make its Commitment.

[***] Represents material that has been omitted and filed separately with the Securities and Exchange
Commission under a Confidental Treatment Request.

                                                              Very truly yours,


                                                           FRONTIER AIRLINES, INC.

                                                           By:_______________________________
                                                                Name:
                                                                Title






                                                                                [Credit Agreement [Frontier/2002-A]]
                                                       EXHIBIT B

                                             FORM OF ASSIGNMENT AGREEMENT

         ASSIGNMENT AGREEMENT [Frontier/2002-A] dated as of __________ __, ____ between
________________________________ (the "Assignee") and _____________________________ (the "Assignor").

                                                  RECITALS

         WHEREAS, the Assignor is the holder of the Note No. ____ dated __________ __, ____ (the
"Assignor's Note") issued under the Credit Agreement [Frontier/2002-A] dated as of June 26, 2002 (the
"Credit Agreement"), between Frontier Airlines, Inc., as Borrower, the lenders that are party thereto
identified under the caption "Lenders" on the signature pages thereto or that, pursuant to Section 24(c)
thereof, shall become a "Lender" thereunder (individually, a "Lender" and, collectively, the "Lenders") and
Landesbank Schleswig-Holstein Girozentrale, as Administrative Agent;

         WHEREAS, the Assignor proposes to assign to the Assignee $____________ of the $_____________
Assignor's Note and a pro rata portion of all of the rights and obligations of the Assignor under the
Credit Agreement and the other Operative Documents (as defined below) in respect thereof, on the terms and
subject to the conditions set forth herein, and the Assignee proposes to accept the assignment of such
rights and obligations from the Assignor on such terms and subject to such conditions;

         NOW, THEREFORE, in consideration of the foregoing and the mutual agreements contained herein, the
parties hereto agree as follows:

         Section 1.  Definitions.  Unless otherwise defined herein, terms defined in the Credit Agreement
 are used herein as therein defined.

         Section 2.  Assignment.  On __________ __, ____ (the "Effective Date"), and on the terms and
subject to the conditions set forth herein, the Assignor will sell, assign and transfer to the Assignee,
without recourse to or representation, express or implied, by the Assignor (except as expressly set forth
in Section 5 hereof), a $___________ portion of the Assignor's Note and a pro rata portion of the rights
and obligations of the Assignor under the Credit Agreement and the other Operative Documents in respect
thereof (but not with respect to any indemnity or other claim, interest thereon at the Past Due Rate and
Break Amounts, if any, accrued and unpaid as of the Effective Date or thereafter payable to the Assignor in
respect of the period prior to the Effective Date), and the Assignee shall accept such assignment from the
Assignor and assume all of the obligations of the Assignor accruing from and after the Effective Date under
the Credit Agreement and the other Operative Documents relating to the Assignor's Note on such terms and
subject to such conditions.  Upon the satisfaction of the conditions set forth in Section 4 hereof, (A) the
Assignee shall, on the Effective Date, succeed to the rights and be obligated to perform the obligations of
a Lender under the Credit Agreement and the other Operative Documents, and (B) the Assignor shall be
released from its obligations under the Credit Agreement and the other Operative Documents accrued from and
after the Effective Date, in each case to the extent such obligations have been assumed by the Assignee.

         Section 3.  Payments.  As consideration for the sale, assignment and transfer contemplated in
Section 2 hereof, the Assignee shall pay to the Assignor, on the Effective Date, in lawful currency of the
United States and in immediately available funds, to the account specified below its signature on the
signature pages hereof, an amount equal to $_______________.

         Section 4.  Conditions.  This Assignment Agreement shall be effective upon the due execution and
delivery of this Assignment Agreement by the Assignor and the Assignee and the effectiveness of the
assignment contemplated by Section 2 hereof is subject to (a) the receipt by the Assignor of the payment
provided for in Section 3 hereof [and the receipt by the Assignee of an up-front fee in the amount of
$_______] and (b) the delivery to the Administrative Agent of the Assignor's Note, duly endorsed for
[partial] transfer to the Assignee, together with a request in the form attached hereto as Exhibit A that a
new Note be issued to the Assignee and Assignor.

         Section 5.  Representations and Warranties of the Assignor.  The Assignor represents and warrants
as follows:  (a) the Assignor has full power and authority, and has taken all action necessary to execute
and deliver this Assignment Agreement and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment Agreement and to fulfill its obligations under, and to
consummate the transactions contemplated by, this Assignment Agreement, and no governmental authorizations
or other authorizations are required in connection therewith, (b) the Assignor's interest in the Assignor's
Note is free and clear of any and all Liens created by or through the Assignor, (c) this Assignment
Agreement constitutes the legal, valid and binding obligation of the Assignor, enforceable against the
Assignor in accordance with its terms, and (d) the Assignor has received no written notice of any Default
having occurred and continuing on the date of execution hereof.

         Section 6.  Representations and Warranties of the Assignee.  The Assignee hereby represents and
warrants to the Assignor that (a) the Assignee has full power and authority, and has taken all action
necessary to execute and deliver this Assignment Agreement and any and all other documents required or
permitted to be executed or delivered by it in connection with this Assignment Agreement and to fulfill its
obligations under, and to consummate the transactions contemplated by, this Assignment Agreement, and no
governmental authorizations or other authorizations are required in connection therewith, (b) this
Assignment Agreement constitutes the legal, valid and binding obligation of the Assignee, enforceable
against the Assignee in accordance with its terms, and (c) the Assignee has fully reviewed the terms of the
Operative Documents and has independently and without reliance upon the Assignor and based on such
information as the Assignee has deemed appropriate, made its own credit analysis and decision to enter into
this Assignment Agreement.

         Section 7.  Further Assurances.  The Assignor and the Assignee hereby agree to execute and deliver
such other instruments, and take such other action, as either party may reasonably request in connection
with the transactions contemplated by this Assignment Agreement.

         Section 8.  Governing Law.  This Assignment Agreement shall be governed by, and construed in
accordance with, the law of the State of New York.

         Section 9.  Notices.  All communications between the parties or notices in connection herewith
shall be in writing, hand-delivered or sent by ordinary mail, telex or facsimile transmitter, addressed as
set forth on the signature pages hereof.  All such communications and notices shall be effective upon
receipt.

         Section 10.  Binding Effect.  This Assignment Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.

         Section 11.  Interpretation.  The headings of the various sections hereof are for convenience of
reference only and shall not affect the meaning or construction of any provision hereof.

         Section 12.  Integration of Terms.  This Assignment Agreement contains the entire agreement
between the parties relating to the subject matter hereof and supersedes all oral statements and other
writings with respect to the subject matter hereof.

         Section 13.  Counterparts.  This Assignment Agreement may be executed in one or more counterparts,
each of which shall be an original but all of which, taken together, shall constitute one and the same
instrument.






                                                                                [Credit Agreement [Frontier/2002-A]]

         IN WITNESS WHEREOF, the parties have caused this Assignment Agreement to be executed and delivered
by their duly authorized officers as of the date first above written.

                                                           [ASSIGNEE]


                                                           By:_______________________________
                                                           Name:
                                                           Title:


                                                           Address for Notices:

                                                           Wire Instructions:


                                                           [ASSIGNOR]


                                                           By:_______________________________
                                                           Name:
                                                           Title:

                                                           Address for Notices:

                                                           Wire Instructions:








                                                                                Exhibit A
                                                                                to Assignment Agreement

                                      Request for Note and Registration

                                                                  --------- --, ----


To:      Landesbank Schleswig-Holstein Girozentrale,
         as Administrative Agent

Ladies and Gentlemen:

         We refer to the assignment by ____________________________ (the "Assignor"), of certain of its
rights and obligations with respect to Note No. ______ in the principal amount of $____________ (the
"Assignor's Note") to ___________________________ (the "Assignee"), pursuant to an Assignment Agreement
[Frontier/2002-A] dated as of _______ __, ____ between the Assignor and the Assignee. Capitalized terms not
otherwise defined herein shall have the meanings assigned thereto in such Assignment Agreement.  The
Assignor hereby delivers the Assignor's Note to Landesbank Schleswig-Holstein Girozentrale, in its capacity
as Administrative Agent.  The Assignor requests Borrower to issue to (i) the Assignee a new Note (the "New
Note") in the principal amount of $____________ and (ii) to the Assignor a new Note (the "Assignor's New
Note") in the principal amount of $______________, each, with a [Delivery Date] issue date.

         The Administrative Agent is hereby instructed to pay all interest on the portion of the Assignor's
Note being assigned hereunder accrued through the date hereof directly to Assignor on the Interest Payment
Date such interest is payable and paid.

         The Assignor requests the Administrative Agent to deliver the New Note to the Assignee at its
address set forth below and to deliver the Assignor's New Note to the undersigned.

                                                           Very truly yours,

                                                           [ASSIGNOR]

                                                           By:_______________________________
                                                           Name:
                                                           Title:

                                                           [ASSIGNEE]

                                                           By:_______________________________
                                                           Name
                                                           Title:

                                                           Address for Notices:

                                                           Wire Instructions
Accepted and Agreed

LANDESBANK SCHLESWIG-HOLSTEIN
GIROZENTRALE,
as Administrative Agent


By:______________________________
Name:
Title:





                                                                                [Credit Agreement [Frontier/2002-A]]
                                                       EXHIBIT C

                                     Terms of Notional Swap Transaction

          (capitalized terms used herein without definition shall have the meanings assigned thereto in the
                          Definitions (as defined in the definition of Swap Form))

                  Trade Date:                      __________ __, ____1

                  Effective Date:                  __________ __, ____2

                  Termination Date:                __________ __, 2___3, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.

                  Notional Amount:                 The Notional Amount in effect for a
                                                   Calculation Period shall be the
                                                   amount set forth in Schedule I
                                                   attached hereto opposite the
                                                   applicable date beginning such
                                                   Calculation Period; provided,
                                                   however, that such dates are subject
                                                   to adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention only with respect to
                                                   determining the Floating Payments.
                  Fixed Payments

                  Fixed Rate Payer                 Party B. [Lender]

                  Fixed Rate
                  Payment Dates:                   The __ of every _________,
                                                   __________, ____________ and
                                                   ________4, beginning __________ __,
                                                   ____5 and ending on the Termination
                                                   Date, payable in arrears, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.

                  Fixed Rate
                  Period End
                  Dates:                           The __ of every __________,
                                                   ___________, ___________ and
                                                   ________6, beginning __________ __,
                                                   ____7 and ending on the Termination
                                                   Date (no adjustment of Period End
                                                   Dates).

                  Fixed Rate:                      _____%.8

                  Fixed Rate
                  Day Count
                  Fraction:                        30/360.

                  Compounding:                     Inapplicable.

                  Floating Payments

                  Floating
                  Rate Payer:                      Party A. [Lender or Swap Agent]

                  Floating Rate
                  Payment Dates:                   The ___ of every __________,
                                                    _________, __________ and _________9,
                                                   beginning __________ __, ____10 and
                                                   ending on the Termination Date,
                                                   payable in arrears, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.

                  Floating Rate
                  Option:                          USD - LIBOR - BBA (except for first
                                                 Calculation Period).

                  Floating Rate for
                  first Calculation
                  Period:                          ___%11 (exclusive of Spread)

                  Spread:                          [1.65%][1.70%] - Option A/B

                  Designated                       [Except for first Calculation Period,
                  Maturity:                        three months for each Calculation
                                                   Period.]

                  Floating Rate                    Actual/360.
                  Day Count
                  Fraction:

                  Floating Rate                    Each Floating Rate Payment Date, exclusive
                  Reset Dates:                     of the last Floating Rate Payment Date.

                  Compounding:                     Inapplicable.

                  Business Day for                 London
                  Rate Setting:

                  Business Day for                 New York, Denver and London
                  Payments:






                                                                                [Credit Agreement [Frontier/2002-A]]

                                                 SCHEDULE I

                                                   TO THE

                                  CONFIRMATION OF THE RATE SWAP TRANSACTION

                                          DATED __________ __, ____


                     DATE12                                                NOTIONAL AMOUNT13

EX-10

                                                                          EXECUTION COPY

PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION IN A CONFIDENTAL TREATMENT REQUEST UNDER
RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.





                                    CREDIT AGREEMENT
                                   [Frontier/2002-B]

                                      Dated as of

                                     July 16, 2002


                                         among



                                FRONTIER AIRLINES, INC.,
                                       Borrower,


                               THE LENDERS LISTED HEREIN,


                                          and


                    ERSTE BANK DER OESTERREICHISCHEN SPARKASSEN AG,
                    as Administrative Agent on behalf of the Lenders

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

                         One (1) Airbus Model A319-111 Aircraft

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






                                  SkyBlue Capital LLC,
                                  Debt Placement Agent






                                        TABLE OF CONTENTS
                                                                                                               Page

Section 1.        Certain Definitions and Interpretive Matters...................................................1

Section 2.        Loans; Borrower's Notice of Delivery Date; Closing Procedure;
                  Alternative Structure..........................................................................1

Section 3.        Fees...........................................................................................2

Section 4.        Conditions.....................................................................................3

Section 5.        Closing Procedure..............................................................................7

Section 6.        Extent of Interest of Lenders..................................................................7

Section 7.        Representations and Warranties.................................................................8

Section 8.        Indemnities...................................................................................12

Section 9.        Covenants of the Borrower.....................................................................19

Section 10.       The Notes.....................................................................................23

Section 11.       Events Of Default; Certain Rights of Administrative Agent.....................................28

Section 12.       Remedies......................................................................................31

Section 13.       Replacement Engines...........................................................................35

Section 14.       The Administrative Agent......................................................................36

Section 15.       Investment Of Funds...........................................................................39

Section 16.       Supplements and Amendments to the Mortgage and Other Operative
                  Documents.....................................................................................40

Section 17.       Notices.......................................................................................41

Section 18.       Governing Law; Consent to Jurisdiction; Waiver of Jury Trial..................................41

Section 19.       Costs and Expenses............................................................................42

Section 20.       Section 1110 Compliance.......................................................................42

Section 21.       Confidentiality...............................................................................42

Section 22.       Covenants of the Administrative Agent and the Lenders.........................................43

Section 23.       Leveraged Lease Financing.....................................................................43

Section 24.       Miscellaneous.................................................................................44

Section 25.       Terms of Fixed Rate Setting...................................................................46


Schedule I     -  Notice & Account Information

Schedule II    -  Participation in Original Amount

Exhibit A      -  Form of Borrowing Notice

Exhibit B      -  Form of Assignment Agreement

Exhibit C      -  Terms of Agreement Transaction







                                                                                [Credit Agreement [Frontier/2002-B]]
                         CREDIT AGREEMENT [Frontier/2002-B]

         THIS CREDIT AGREEMENT [Frontier/2002-B] dated as of July 16, 2002 among
(i) Frontier Airlines, Inc., a Colorado corporation (the "Borrower"), (ii) the lenders
that are party hereto identified under the caption "Lenders" on the signature pages
hereto or that, pursuant to Section 24(c) hereof, shall become a "Lender" hereunder
(individually, a "Lender" and, collectively, the "Lenders") and (iii) Erste Bank der
oesterreichischen Sparkassen AG, a bank organized under the laws of Austria, as
Administrative Agent on behalf of the Lenders (the "Administrative Agent").

                                  W I T N E S S E T H:

         WHEREAS, certain terms are used herein as defined in Section 1 hereof; and

         WHEREAS, concurrently with the execution and delivery of this Agreement, the
Borrower and the Administrative Agent are entering into the Mortgage and Security
Agreement [Frontier/2002-B] dated as of the date hereof (the "Mortgage") pursuant to
which the Borrower agrees, among other things, to issue one or more Notes in respect
of the Aircraft as evidence of the Borrower's indebtedness to the Lenders, which Notes
will be secured by the mortgage and security interest created by the Borrower in favor
of the Administrative Agent on behalf of the Lenders, and the Borrower shall execute
and deliver a Mortgage Supplement covering the Aircraft, supplementing the Mortgage.

         NOW THEREFORE, in consideration of the mutual agreements herein contained, the
parties hereto agree as follows:

Section 1.        Certain Definitions and Interpretive Matters.

         Except as otherwise defined in this Agreement, including its annexes,
schedules and exhibits, terms used herein in capitalized form shall have the meanings
attributed thereto in the Mortgage.  The rules of interpretation contained in
Section 1.02 of the Mortgage shall be applicable to this Agreement.  Unless the context
otherwise requires, any reference herein to any of the Operative Documents refers to
such document as it may be modified, amended or supplemented from time to time in
accordance with its terms and the terms of each other agreement restricting the
modification, amendment or supplement thereof.

Section 2.        Loans; Borrower's Notice of Delivery Date; Closing Procedure; Alternative Structure.

(a)      Loans.  Subject to the terms and conditions of this Agreement, each Lender agrees to
make a secured loan to the Borrower in respect of the Aircraft (herein called a "Loan") on a
date to be designated pursuant to Section 2 hereof, on or about July 16, 2002 but in no event
later than December 31, 2002 (the "Commitment Termination Date"), in the amount in
Dollars set forth opposite such Lender's name in Schedule II hereto (its "Commitment"), and to
receive, as evidence of each such secured loan, Note(s) in an amount equal to its Commitment.  The
aggregate amount of the Commitments for the Aircraft shall equal the Original Amount for the Aircraft.
Each Loan shall bear interest and amortize in accordance with Section 2.02 of the Mortgage.  If any
Lender shall default in its obligation to make the amount of its Commitment available
pursuant to this Section 2 in respect of the Aircraft, no other Lender shall have an
obligation to make any portion of such amount available or to increase the amount of
its commitment for the Aircraft and the obligations of the non-defaulting Lender shall
remain subject to the terms and conditions set forth in this Agreement.

(b)      Notice of Delivery Dates.  The Borrower agrees to give the Lenders and the Administrative
Agent at least three (3) Business Days' prior written notice of the Delivery Date for the Aircraft,
which Delivery Date shall be a Business Day not later than the Commitment Termination Date by executing
and delivering a borrowing notice substantially in the form of Exhibit A hereto (the "Borrowing Notice"),
which notice shall also specify (if not previously selected as provided in paragraph (e) below) the Term
Option elected and any funding instructions.  The payment by each Lender of its Commitment in respect of
the Aircraft in the manner required by this Section 2 shall constitute a waiver of such notice.

(c)      Closing Procedure.  Subject to the terms and conditions of this Agreement, and simultaneous
with receipt by the Seller of the Original Amount for the Aircraft pursuant to this Section 2, the
Borrower shall authorize the delivery and filing for record at the FAA of the Mortgage and the Mortgage
Supplement.  On the Delivery Date specified in the Borrower's notice referred to in the first paragraph of
this Section 2, subject to the terms and conditions of this Agreement, each Lender agrees to pay, through
the Administrative Agent, the amount of its Commitment to the Seller by wire transferring such amounts to
the Seller's account at Credit Lyonnais, 1301 Avenue of the Americas, New York, NY 10019, ABA No. [***]
Account #  [***] , Attention:  Mustapha Diop, Reference Frontier MSN 1781 or to such other account as the
Borrower shall direct the Administrative Agent (on behalf of the Lenders) in writing, upon closing.

[***] Represents material that has been omitted and filed separately with the Securities and Exchange Commission
under a Confidental Treatment Request.

(d)      Alternative Structure.  Notwithstanding anything to the contrary in this Agreement or
any other Operative Document, the Borrower, subject to the provisions of this Section 2(d) and
Section 23 hereof, may elect to finance the Aircraft on the basis of a U.S. leveraged lease financing,
whereupon the Lenders' Commitments shall be utilized for such purpose, and the Lenders' obligations to
finance the Aircraft on a mortgage basis, and the Borrower's obligations to use the Lenders' Commitments
to finance the Aircraft on a mortgage basis, shall be deemed discharged by such utilization.

(e)      Term Option.  The Borrower shall notify the Administrative Agent on or prior to the Delivery
Date of the Term Option for the Aircraft, which notice shall be irrevocable.

(f)      Purpose.  The Borrower shall use the proceeds of the Loans to purchase the Aircraft from
the Seller; however, neither the Administrative Agent nor the Lenders shall have any responsibility in respect
of the use of the Loans by the Borrower.

Section 3.        Fees.  (a)  The Borrower agrees to pay to the Administrative Agent (on behalf of
the Lenders), on or before the Delivery Date, an up-front fee of the percentage (the "Up-front Fee")
of the Original Amount of each Loan to be funded on the Delivery Date as separately agreed, to the account of
the Administrative Agent specified in Schedule I hereto (or such other account as the Administrative Agent may
direct in writing).

(b)      The Borrower agrees to pay to the Administrative Agent (on behalf of the Lenders), after
the date hereof, a commitment fee of  [***] % (the "Commitment Fee") on the unutilized Commitments,
to the account of the Administrative Agent specified in Schedule I hereto (or such other account as the
Administrative Agent may direct in writing).  The Commitment Fee shall accrue from and including September
26, 2002 to but excluding the earlier of (x) the Delivery Date and (y) the Commitment Termination Date.
The Commitment Fee shall be payable on the earlier dates contemplated by clauses (x) and (y) of the
preceding sentence.  The Commitment Fee shall be calculated on the basis of a year of 360 days and actual
number of days elapsed.  Promptly following receipt by the Administrative Agent of the Commitment Fee in
respect of any period, the Administrative Agent shall distribute the same to each Lender, pro rata based on such
Lender's unutilized Commitments.

[***] Represents material that has been omitted and filed separately with the Securities and Exchange Commission
under a Confidental Treatment Request.

Section 4.        Conditions.  (a)  Conditions Precedent to the Effectiveness of the Commitment.
It is agreed that the Commitment of the Lenders is subject to the satisfaction prior to or on the
Delivery Date of the following conditions precedent:

(i)      The following documents shall have been duly authorized, executed and delivered by the respective party
         or parties thereto, shall each be satisfactory in form and substance to the
         Administrative Agent and each Lender and shall be in full force and effect and
         executed counterparts shall have been delivered to the Lenders and the
         Administrative Agent or their respective counsel:

(A)      the Mortgage; and

(B)      a copy of that portion of the Purchase Agreement and Engine Agreement certified by the Secretary or an
                  Assistant Secretary of the Borrower as being a true and accurate copy
                  of the same that relates to the Assigned Warranties and the related
                  obligations of the Borrower or a successor in interest to the
                  Borrower which has the right to exercise any such warranty.

(ii)     Each Lender and the Administrative Agent shall have received the following, in each case in form and
         substance satisfactory to each of them:

(A)      a certified copy of the Articles of Incorporation and Bylaws of the Borrower and a copy of resolutions
                  of the board of directors of the Borrower or the executive committee
                  thereof, certified by the Secretary or an Assistant Secretary of the
                  Borrower, duly authorizing the execution, delivery and performance by
                  the Borrower of this Agreement, the Mortgage and each other document
                  required to be executed and delivered by the Borrower on the Delivery
                  Date in accordance with the provisions hereof and thereof; and

(B)      a certificate of the Borrower as to the Person or Persons authorized to execute and deliver this
                  Agreement, the other Operative Documents, and any other documents to
                  be executed on behalf of the Borrower in connection with the
                  transactions contemplated hereby and as to the signature of such
                  person or persons.

(iii)    Each Lender and the Administrative Agent shall have received an opinion addressed to such Lender and the
         Administrative Agent from each of: (A) David Sislowski, Esq., General Counsel
         for the Borrower and (B) Curtis Mallet-Prevost, Colt & Mosle LLP, special
         counsel to the Borrower, each in form and substance reasonably satisfactory to
         the addressees thereof.

(b)      Conditions Precedent to each Lender's Commitment to Lend on the Delivery Date.  It is agreed
that the respective obligations of each Lender to lend its Commitment to the Borrower in
respect of the Aircraft is subject to the satisfaction prior to or on the Delivery Date of the following
conditions precedent:

(i)      Each Lender and the Administrative Agent shall have received from the Borrower a duly executed Borrowing
         Notice with respect to the Delivery Date pursuant to Section 2 hereof.

(ii)     No change shall have occurred after the date of the execution and delivery of this Agreement in
         applicable law or regulations thereunder or interpretations thereof by
         appropriate regulatory authorities which, in the reasonable opinion of each
         Lender would make it a violation of law or regulations for such Lender to make
         its Commitment for the Aircraft available to fund the applicable Loan or to
         realize the benefits of the security afforded by the Mortgage in respect
         thereof.

(iii)    On the Delivery Date, the Aircraft will have been duly certified by the FAA as to type and
         airworthiness, will have been insured by the Borrower in accordance with the
         terms of the Mortgage, will have suffered no Event of Loss (or event which,
         with the passage of time would constitute an Event of Loss) and will be in the
         condition and state of repair required under the terms of the Mortgage.

(iv)     The following documents shall have been duly authorized, executed and delivered by the respective party
         or parties thereto, shall each be satisfactory in form and substance to the
         Lenders and the Administrative Agent and shall be in full force and effect and
         executed counterparts shall have been delivered to the Lenders and the
         Administrative Agent or their respective counsel, provided that only each
         Lender shall receive an executed original of its respective Note(s):

(A)      the Mortgage Supplement covering the Aircraft and dated the Delivery Date;  Schedule 1 to such Mortgage
                  Supplement shall be completed as provided in Section 2.02(c) of the
                  Mortgage;

(B)      the Note(s) in an aggregate principal amount equal to the Original Amount reflecting the Term Option
                  selected by the Borrower;

(C)      the Consent and Agreement and the Engine Consent and Agreement, each of which shall be in form and
                  substance reasonably satisfactory to the Administrative Agent; and

(D)      the Warranty Bill of Sale and FAA Bill of Sale for the Aircraft.

(v)      The Borrower shall have authorized the filing by the Administrative Agent of Uniform Commercial Code
         financing statement or statements covering all the security interests created
         by or pursuant to the granting clause of the Mortgage that are not covered by
         the recording system established by the Federal Aviation Act, and such
         financing statement or statements shall have been duly filed in all places
         deemed necessary or advisable in the opinion of counsel for the Lenders, and
         any additional Uniform Commercial Code financing statements deemed advisable
         by the Lenders shall have been duly filed and all other action shall have been
         taken as is deemed necessary or advisable, in the opinion of counsel for the
         Lenders, to establish and perfect the Administrative Agent's security interest
         in the Aircraft.

(vi)     All appropriate action required to have been taken by the Federal Aviation Administration, or any
         governmental or political agency, subdivision or instrumentality of the United
         States, on or prior to the Delivery Date in connection with the transaction
         contemplated by this Agreement shall have been taken, and all orders, permits,
         waivers, authorizations, exemptions and approvals of such entities required to
         be in effect on the Delivery Date in connection with the transaction
         contemplated by this Agreement shall have been issued, and all such orders,
         permits, waivers, authorizations, exemptions and approvals shall be in full
         force and effect on the Delivery Date.

(vii)    On the Delivery Date the following statements shall be true, and the Lenders shall have received
         evidence satisfactory to it to the effect that:

(A)      the Borrower has good title to the Aircraft, free and clear of Liens other than (subject to filing and
                  recording of the FAA Bill of Sale with the Federal Aviation
                  Administration if the Borrower does not already own the Aircraft) the
                  mortgage and security interests created by the Mortgage and the
                  Mortgage Supplement;

(B)      the Mortgage, the FAA Bill of Sale and the Mortgage Supplement have been duly filed with the FAA for
                  recordation (or are in the process of being so filed for recordation)
                  and there exist no Liens of record on the Aircraft prior to the Lien
                  of the Mortgage;

(C)      the Aircraft has been duly certified as to type and airworthiness by the FAA, and the Borrower has
                  authority to operate the Aircraft (and the Lenders shall have
                  received a copy of the airworthiness certificate for the Aircraft);
                  and

(D)      the Administrative Agent is entitled to the protection of Section 1110 of the United States Bankruptcy
                  Code in connection with its right to take possession of the Aircraft
                  in the event of a case under Chapter 11 of the United States
                  Bankruptcy Code in which the Borrower is a debtor.

(viii)   On the Delivery Date, the representations and warranties of the Borrower contained in Section 7(a) of
         this Agreement shall be true and accurate as though made on and as of each
         such date except to the extent that such representations and warranties relate
         solely to an earlier date (in which case such representations and warranties
         shall be true and accurate on and as of such earlier date), including the
         representation and warranty that there had not occurred any event which
         constitutes a Default or an Event of Default which is presently continuing.

(ix)     Each Lender and the Administrative Agent shall have received an opinion addressed to such Lender and the
         Administrative Agent from each of:  (A) David Sislowski, Esq., General Counsel
         for the Borrower and (B) Curtis Mallet-Prevost, Colt & Mosle LLP, special
         counsel to the Borrower, each in form and substance reasonably satisfactory to
         the addressees thereof.

(x)      Each Lender and the Administrative Agent shall have received an opinion addressed to such Lender and the
         Administrative Agent and the Borrower from Daugherty, Fowler, Peregrin &
         Haught, FAA counsel in Oklahoma City, Oklahoma, in form and substance
         reasonably satisfactory to the addressees thereof.

(xi)     Each Lender and the Administrative Agent shall have received an opinion addressed to the Administrative
         Agent from in-house counsel to Seller, in respect of the Bills of Sale for the
         Aircraft delivered on the Delivery Date, in form and substance reasonably
         satisfactory to the addressees thereof.

(xii)    Each Lender and the Administrative Agent shall have received a certificate signed by the President, a
         Vice President, the Chief Financial Officer or the Treasurer of the Borrower,
         dated the Delivery Date, addressed to each Lender and the Administrative Agent
         and certifying as to the matters stated in paragraphs (viii) and (xiv) of this
         Section 4(b).

(xiii)   Each Lender and the Administrative Agent shall have received an independent insurance brokers' report
         and certificate(s) of insurance, in form and substance reasonably satisfactory
         to each Lender and the Administrative Agent as to the due compliance with the
         terms of Article VI of the Mortgage relating to insurance with respect to the
         Aircraft.

(xiv)    On the Delivery Date it shall be true that no Event of Loss (or event which with the passage of time
         would become an Event of Loss) with respect to the Aircraft (or the Airframe)
         or any Engine has occurred.

(xv)     No action or proceeding shall have been instituted nor shall governmental action be threatened before
         any court or governmental agency, nor shall any order, judgment or decree have
         been issued or proposed to be issued by any court or governmental agency at
         the time of the Delivery Date to set aside, restrain, enjoin or prevent the
         completion and consummation of this Agreement or the transaction contemplated
         hereby.

(xvi)    The Administrative Agent shall have received the Up-front Fee pursuant to Section 3(a) and, if
         applicable, any Commitment Fee pursuant to Section 3(b) that is due and
         payable.

(xvii)   The Lenders shall have received from the Borrower the statement of financial position and statement of
         earnings and cash flow for the Borrower for the fiscal quarter most recently
         ended at least 60 days prior to the Delivery Date, and since the date of such
         statement of financial position and statement of earnings and cash flow, there
         shall have occurred no materially adverse change in the financial condition or
         operations of the Borrower which would affect the Borrower's ability to
         perform its obligations hereunder or under any of the Operative Documents.

(xviii)  No material disruption shall have occurred in the London interbank market that may have an adverse
         effect upon the Lenders.

(xix)    Each other Lender shall have made available the amount of its Commitment for the Aircraft in accordance
         with Section 2(a) hereof.

Promptly upon the recording of the Mortgage and the Mortgage Supplement covering the
Aircraft pursuant to the Federal Aviation Act, the Borrower will cause Daugherty,
Fowler, Peregrin & Haught, FAA counsel in Oklahoma City, Oklahoma, to deliver to the
Lenders, the Administrative Agent and the Borrower an opinion as to the due and valid
registration of the Aircraft in the name of the Borrower, the due recording of the
Mortgage and the Mortgage Supplement and the lack of filing of any intervening
documents with respect to the Aircraft.  Promptly following the Delivery Date, the
Borrower shall cause a huissier to serve a copy of a notice delivered on the Delivery
Date on the Manufacturer and the Seller in accordance with Article 1690 of the French
Civil Code.

Section 5.        Closing Procedure.  Following the Borrower's notice of the Delivery Date
as provided in Section 2 hereof, the parties will pre-position the executed Mortgage and Mortgage
Supplement with FAA counsel in Oklahoma City, Oklahoma, together with the FAA Bill of
Sale for the Aircraft and the application for registration of the Aircraft in the name
of the Borrower.  On the Delivery Date and in sufficient time to permit the closing to
occur during business hours of the FAA in Oklahoma City, Oklahoma, each Lender will
wire transfer, through the Administrative Agent, its Commitment to the Seller.  On the
Delivery Date, by conference telephone call among the Seller, the Borrower, the
Lenders (and/or their counsel acting on their behalf), the Administrative Agent and
FAA counsel, the Seller will authorize the filing of the FAA Bill of Sale for the
Aircraft and the Borrower will authorize the filing of the Mortgage and the Mortgage
Supplement upon receipt by the Seller of the Original Amount of the Loan for the
Aircraft.  The irrevocable authorization to FAA counsel to date the FAA Bill of Sale
and the Mortgage Supplement and file the FAA Bill of Sale and the Mortgage and
Mortgage Supplement will occur prior to the transfer of the Original Amount of the
Loan for the Aircraft to the Seller, but the filing will not occur until the Seller's
receipt of the purchase price for the Aircraft.  The Note(s) will be delivered to the
Lenders, as applicable, and legal opinions will be delivered to all parties
immediately following the filing of the FAA Bill of Sale and the Mortgage and Mortgage
Supplement at the FAA.

Section 6.        Extent of Interest of Lenders.  No Lender shall have any further interest
in, or other right with respect to, the mortgage and security interests created by the Mortgage when and
if the Original Amount of and interest on all Note(s) held by such Lender and all
other sums payable to such Lender hereunder, under the Mortgage and under such Note(s)
shall have been paid in full.

Section 7.        Representations and Warranties.  (a)  Borrower's Representations and Warranties.
The Borrower represents and warrants that on the date hereof and on the Delivery Date:

(i)      the Borrower is a corporation duly organized and validly existing in good standing pursuant to the laws
         of the State of Colorado; is duly qualified to do business as a foreign
         corporation in each jurisdiction in which its operations or the nature of its
         business requires, except where the failure to be so qualified would not have
         a material adverse effect on the Borrower or its business; is a U.S. Air
         Carrier; maintains its location (as such term is defined in Article 9 of the
         Uniform Commercial Code) in Colorado; and has the corporate power and
         authority to engage in air transport and to carry on scheduled passenger
         service as presently conducted, to own the Aircraft and to enter into and
         perform its obligations under the Operative Documents;

(ii)     the execution, delivery and performance by the Borrower of the Operative Documents will, on the Delivery
         Date, have been duly authorized by all necessary corporate action on the part
         of the Borrower, do not require any stockholder approval, or approval or
         consent of any trustee or holders of any indebtedness or obligations of the
         Borrower except such as have been duly obtained or by the Delivery Date will
         have been duly obtained and will on the Delivery Date be in full force and
         effect, and none of such Operative Documents contravenes any law, judgment,
         government rule, regulation or order binding on the Borrower or the articles
         of incorporation or bylaws of the Borrower or contravenes the provisions of,
         or constitutes a default under, or results in the creation of any Lien (other
         than Permitted Liens) upon the property of the Borrower under, any indenture,
         mortgage, contract or other agreement to which the Borrower is a party or by
         which it or its properties may be bound or affected;

(iii)    neither the execution and delivery by the Borrower of the Operative Documents nor the performance by the
         Borrower of its obligations thereunder requires the consent or approval of,
         the giving of notice to, or the registration with, or the taking of any other
         action in respect of any Federal, state or foreign government authority or
         agency, except for (A) the orders, permits, waivers, exemptions,
         authorizations and approvals of the regulatory authorities having jurisdiction
         over the operation of the Aircraft by the Borrower, which orders, permits,
         waivers, exemptions, authorizations and approvals have been duly obtained or
         will on or prior to the Delivery Date be duly obtained, and will on the
         Delivery Date be in full force and effect, (B) any normal periodic and other
         reporting requirements under the Federal Aviation Act and the regulations
         promulgated thereunder and the applicable rules, and regulations of the FAA,
         in each case to the extent required to be given or obtained only after the
         Delivery Date, (C) any filings, registrations or applications specifically
         described in this Agreement, and (D) an air operator's certificate with
         respect to Airbus Model A319 aircraft, which certificate has been obtained by
         the Borrower;

(iv)     the Operative Documents to which the Borrower is a party delivered on or prior to the date hereof or the
         Delivery Date, as the case may be, each constitute legal, valid and binding
         obligations of the Borrower enforceable against the Borrower in accordance
         with the terms thereof except as such may be limited by equitable principles
         or applicable bankruptcy, insolvency, reorganization, moratorium or other
         similar laws affecting creditors' rights generally;

(v)      there are no pending or, to the best of Borrower's knowledge, threatened actions or proceedings before
         any court, arbitrator or administrative agency which individually (or in the
         aggregate in the case of any group of related lawsuits) is expected to have a
         material and adverse effect on the financial condition of the Borrower or the
         ability of the Borrower to perform its obligations under the Operative
         Documents;

(vi)     except for (A) the filing for recording pursuant to the Federal Aviation Act of the FAA Bill of Sale for
         the Aircraft (and the application for registration of the Aircraft in the name
         of the Borrower) and the Mortgage with the Mortgage Supplement for the
         Aircraft, (B) the filing of financing statements (and continuation statements
         at periodic intervals) with respect to the interests created by such documents
         under the Uniform Commercial Code of Colorado and such other states as may be
         specified in the opinion furnished pursuant to Section 4(b)(ix) hereof and
         (C) the affixation of the nameplates referenced in Section 3.04 of the
         Mortgage, no further action, including any filing or recording of any document
         (including any financing statement in respect thereof under Article 9 of the
         Uniform Commercial Code of any applicable jurisdiction), is necessary or
         advisable in order to establish and perfect the first mortgage Lien on the
         Aircraft in favor of the Administrative Agent pursuant to the Mortgage in any
         applicable jurisdiction in the United States;

(vii)    there has not occurred any event which constitutes a Default or an Event of Default hereunder which is
         presently continuing;

(viii)   the statements of financial position of the Borrower as of March 31, 2002 and the date of the most
         recently concluded fiscal quarter of the Borrower for which a statement of
         financial position has been provided and the related statements of earnings
         and cash flow of the Borrower in all material respects for the year and fiscal
         quarter, respectively, then ended, copies of which have been furnished to the
         Lenders, fairly present the financial condition of the Borrower at such date
         and the results of operations and cash flow of the Borrower for the period
         ended on such dates, in accordance with generally accepted accounting
         principles consistently applied, and subject, in the case of the statements
         pertaining to the Borrower's most recently concluded fiscal quarter, to normal
         year-end adjustments, and since March 31, 2002, there has been no material and
         adverse change in the business or financial condition of the Borrower;

(ix)     on the Delivery Date the Borrower will have good title to the Mortgage Estate delivered on the Delivery
         Date free and clear of all Liens, except the Lien of the Mortgage, and
         Inchoate Liens;

(x)      neither the Borrower nor anyone acting on behalf of the Borrower has directly or indirectly offered any
         interest in the Notes for sale to, or solicited any offer to acquire any of
         the same from, anyone other than the Lenders and not more than 35 other
         institutions believed capable of evaluating and bearing the risks of
         investment in the transactions contemplated hereby;

(xi)     the Borrower has filed or caused to be filed all Federal, state, local and (to the best of Borrower's
         knowledge) foreign tax returns which are required to be filed and has paid or
         caused to be paid or provided adequate reserves for the payment of all taxes
         shown to be due and payable on such returns or (except to the extent being
         contested in good faith and by appropriate proceedings and for the payment of
         which adequate reserves have been provided in accordance with generally
         accepted accounting principles) on any assessment received by the Borrower, to
         the extent that such taxes have become due and payable, except such returns or
         taxes as do not materially and adversely affect the business, property or
         assets, operations or financial condition, of the Borrower and do not involve
         a material risk of the sale, forfeiture or loss of, or the creation of any
         Lien (other than a Permitted Lien) on the Aircraft;

(xii)    the Borrower is not (x) in default under any indenture, mortgage, lease or Credit Agreement or under any
         other agreement or instrument of a material nature to which the Borrower is
         now a party or by which it is bound, and no event has occurred and is
         continuing which, under the provisions of any such indenture, mortgage, Credit
         Agreement or other material agreement or instrument, with the lapse of time or
         the giving of notice, or both, would constitute a default thereunder or (y) in
         violation of any law, order, injunction, decree, rule or regulation applicable
         to the Borrower of any court or administrative body, which violation (a) would
         reasonably be expected to materially and adversely affect the business,
         operations or financial condition of the Borrower or the Borrower's ability to
         execute, deliver and perform its obligations under the Operative Documents or
         (b) would involve a material risk of the sale, forfeiture or loss of, or the
         creation of any Lien (other than a Permitted Lien) on, any of the Mortgage
         Estate;

(xiii)   the Borrower has not engaged in any transaction in connection with which the Borrower could be subjected
         to either a material civil penalty assessed pursuant to Section 502(i) of
         ERISA, or a material tax imposed by Section 4975 of the Code; (w) no material
         liability to the Pension Benefit Guaranty Corporation (other than liability
         for premiums) has been incurred by the Borrower with respect to any Plan;
         (x) there has been no event or condition which presents a material risk of
         termination of any Plan by the Pension Benefit Guaranty Corporation; (y) no
         accumulated funding deficiency (as defined in Section 302 of ERISA and
         Section 412 of the Code), whether or not waived, exists with respect to any
         Plan; and (z) no material amount of "withdrawal liability," as that term is
         used in Section 4201 of ERISA, has been or is expected to be incurred by the
         Borrower nor has the Borrower or any affiliate of the Borrower been notified
         by any multi-employer plan (within the meaning of Section 3(37)(A) of ERISA)
         that such multi-employer plan is in reorganization or insolvency within the
         meaning of Section 4241 or Section 4245 of ERISA or that such multi-employer
         plan intends to terminate or has been terminated under Section 4041A of ERISA
         (for purposes of this subclause (z), the term "affiliate" shall mean any
         corporation or person which is a member of the same controlled group of
         corporations (within the meaning of Section 414(b) of the Code) as the
         Borrower or is under common control (within the meaning of Section 414(c) of
         the Code) with the Borrower);

(xiv)    neither the Borrower nor any Plan nor any trust created thereunder has engaged in a "prohibited
         transaction," within the meaning of Section 406 of ERISA or Section 4975 of
         the Code with respect to the transactions contemplated hereby which could
         subject the Borrower to any tax or penalty pursuant to Section 4975 of the
         Code or Section 502(i) of ERISA;

(xv)     the Borrower is not an "investment company" as defined in, or subject to regulation under, the
         Investment Company Act of 1940 and the Borrower is not a "holding company" as
         defined in, or subject to regulation under, the Public Utility Holding Company
         Act of 1935;

(xvi)    none of the reports, financial statements, certificates or other information furnished by or on behalf
         of the Borrower to the Administrative Agent or the Lenders in connection with
         the negotiation of this Agreement or delivered hereunder (as modified or
         supplemented by other information so furnished) contains any material
         misstatement of fact or omits to state any material fact necessary to make the
         statements therein, in the light of the circumstances under which they were
         made, not misleading;

(xvii)   no part of the proceeds of any Loan hereunder will be used, whether directly or indirectly, for any
         purpose that entails a violation of any of the Regulations of the Board of
         Governors of the Federal Reserve, including Regulations U and X;

(xviii)  assuming the Lenders are acquiring their Notes in the ordinary course of their commercial banking
         business, none of the transactions contemplated by this Agreement will violate
         or result in a violation of the Securities Act of 1933, as amended, the
         securities Exchange Act of 1934, as amended, or any regulations issued
         pursuant thereto; and

(xix)    no United States Federal or state non-banking governmental approval of any kind is required of any
         Lender for its execution of or performance under this Agreement or any
         agreement contemplated hereby solely by reason of any fact or circumstance
         peculiar to: (a) the Borrower, (b) the nature of the Aircraft, or (c) the
         Borrower's proposed operation or use of the Aircraft.

(b)      Lenders' Representations and Warranties.  Each Lender severally represents and warrants to each of the
other Parties hereto, as of the date hereof and as of the Delivery Date that:

(i)      it is acquiring its Notes in the ordinary course of its commercial banking business and it has no
         present intention of distributing or reselling any interest to be acquired by
         it hereunder or under any of the other Operative Documents or any part thereof
         in violation of the Securities Act of 1933, as amended; and

(ii)     no part of the funds to be used by it to purchase or fund, as the case may be, its Notes or its interest
         under any of the Operative Documents constitutes plan assets of an employee
         benefit plan which is subject to ERISA and/or subject to Section 4975 of the
         United States Internal Revenue Code of 1986, as amended.  As used in this
         Section 7(b)(ii), the term "plan assets" shall have the meaning assigned to
         such term under ERISA and the regulations promulgated thereunder.

Section 8.        Indemnities.  (a)  General Indemnity.  Subject to the next
following paragraph but without limiting any other rights that any Indemnitee may have under the
other Operative Documents or applicable law, the Borrower hereby agrees to indemnify each
Indemnitee on an after-tax basis against, and agrees to protect, save and keep harmless each of
them from any and all Expenses imposed on, incurred by or asserted against any
Indemnitee arising out of or resulting from (i) the operation, possession, use,
maintenance, overhaul, testing, registration, reregistration, delivery, non-delivery,
lease, nonuse, modification, alteration, or sale of the Aircraft, the Airframe or any
Engine, or any engine used in connection with the Airframe or any part of any of the
foregoing by the Borrower, any lessee or any other Person whatsoever, whether or not
such operation, possession, use, maintenance, overhaul, testing, registration,
reregistration, delivery, non-delivery, lease, nonuse, modification, alteration, or
sale is in compliance with the terms of the Mortgage, including, without limitation,
claims for death, personal injury or property damage or other loss or harm to any
person whatsoever and claims relating to any laws, rules or regulations pertaining to
such operation, possession, use, maintenance, overhaul, testing, registration,
reregistration, delivery, non-delivery, lease, non-use, modification, alteration, sale
or return including environmental control, noise and pollution laws, rules or
regulations; (ii) the manufacture, design, purchase, acceptance, rejection, delivery,
or condition of the Aircraft, the Airframe or any Engine, any engine used in
connection with the Airframe, or any part of any of the foregoing including, without
limitation, latent and other defects, whether or not discoverable, or trademark or
copyright infringement; (iii) any breach of or failure to perform or observe, or any
other noncompliance with, any covenant or agreement to be performed, or other
obligation of the Borrower under any of the Operative Documents, or the falsity of any
representation or warranty of the Borrower in any of the Operative Documents; and
(iv) any Event of Default hereunder or the enforcement against the Borrower of any of
the terms hereof (including, without limitation, Section 12 hereof).

                  The foregoing indemnity shall not extend to any Expense of any
Indemnitee to the extent attributable to one or more of the following:  (1) acts or
omissions involving the willful misconduct or gross negligence of such Indemnitee or
any Person acting on behalf of such Indemnitee (other than gross negligence imputed to
such Indemnitee solely by reason of its interest in the Aircraft, as finally
determined by a court of competent jurisdiction); (2) any Tax, or increase in tax
liability under any tax law (such matter being subject to the indemnity in
Sections 8(b) and (c) hereof); (3) a failure on the part of the Administrative Agent to
distribute in accordance with the Operative Documents any amounts received and
distributable by it thereunder; (4) any breach of undertaking or any misrepresentation
contained herein or in any other Operative Document to which such Indemnitee is a
party or any agreement relating hereto or thereto by such Indemnitee and in each case
not attributable directly to any breach of undertaking, any misrepresentation or any
noncompliance with any of the terms hereof or of any other Operative Document or any
agreement relating hereto or thereto by Borrower; (5) a Lender Lien; or (6) a
violation of the Securities Act relating to or arising out of the offer, issuance,
sale or delivery by such Indemnitee (or any person who controls such Indemnitee within
the meaning of Section 15 of the Securities Act) of any security based upon the credit
of the Borrower.

                  If a claim is made against an Indemnitee involving one or more
Expenses and such Indemnitee has notice thereof, such Indemnitee (or its agent) shall
promptly after receiving such notice give notice of such claim to the Borrower;
provided that the failure to provide such notice shall not release the Borrower from
any of its obligations to indemnify hereunder except to the extent that the Borrower
is prejudiced as a result of the failure to give such notice in a timely fashion, and
no payment by the Borrower to an Indemnitee pursuant to this Section 8(a) shall be
deemed to constitute a waiver or release of any right or remedy which the Borrower may
have against such Indemnitee for any actual damages as a result of the failure by such
Indemnitee to give the Borrower such notice.  The Borrower shall be entitled, at its
sole cost and expense, acting through a single counsel reasonably acceptable to the
respective Indemnitee, so long as the Borrower has acknowledged in writing its
responsibility for such Expense hereunder (unless such Expense is covered by the
second paragraph of this Section 8(a), except that such acknowledgment does not apply
if the decision of a court or arbitrator provides that the Borrower is not liable
hereunder), (A) in any judicial or administrative proceeding that involves solely a
claim for one or more Expenses, to assume responsibility for and control thereof,
(B) in any judicial or administrative proceeding involving a claim for one or more
Expenses and other claims related or unrelated to the transactions contemplated by the
Operative Documents, to assume responsibility for and control of such claim for
Expenses to the extent that the same may be and is severed from such other claims (and
such Indemnitee shall use its reasonable efforts to obtain such severance), and (C) in
any other case, to be consulted by such Indemnitee with respect to judicial
proceedings subject to the control of such Indemnitee and to be allowed, at the
Borrower's sole expense, to participate therein.  The Indemnitee may participate at
its own expense and with its own counsel in any judicial proceeding controlled by the
Borrower pursuant to the preceding provisions.  Notwithstanding any of the foregoing,
the Borrower shall not be entitled to assume responsibility for and control of any
such judicial or administrative proceedings if any Event of Default shall have
occurred and be continuing, if such proceedings will involve a material risk of the
sale, forfeiture or loss of the Aircraft unless the Borrower shall have posted a bond
or other security reasonably satisfactory to the relevant Indemnitee with respect to
such risk or if such proceedings could entail any risk of criminal liability being
imposed on such Indemnitee.

                  The Indemnitee shall supply the Borrower with such information
reasonably requested by the Borrower as is necessary or advisable for the Borrower to
control or participate in any proceeding to the extent permitted by this
Section 8(a).  Such Indemnitee shall not enter into a settlement or other compromise
with respect to any Expense without the prior written consent of the Borrower, which
consent shall not be unreasonably withheld or delayed, unless such Indemnitee waives
its right to be indemnified with respect to such Expense under this Section 8(a).  In
the case of any Expense indemnified by Borrower hereunder which is covered by a policy
of insurance maintained by Borrower, each Indemnitee agrees, at Borrower's expense, to
cooperate reasonably with the insurers in the exercise of their rights to investigate,
defend or compromise such loss or liability as may be reasonably required to retain
the benefits of such insurance with respect to such loss or liability.

                  To the extent of any payment of any Expense pursuant to this
Section 8(a), the Borrower, without any further action, shall be subrogated to any
claims the Indemnitee may have relating thereto.  The Indemnitee agrees to give such
further assurances or agreements and to cooperate with the Borrower to permit the
Borrower to pursue such claims, if any, to the extent reasonably requested by the
Borrower.

                  In the event that the Borrower shall have paid an amount to an
Indemnitee pursuant to this Section 8(a), and such Indemnitee subsequently shall be
reimbursed in respect of such indemnified amount from any other Person, such
Indemnitee shall promptly pay the Borrower the amount of such reimbursement, including
interest received attributable thereto, provided that no Special Default or Event of
Default has occurred and is continuing.

                  Amounts payable under this Section 8(a) shall be payable by the
Borrower within thirty days of demand therefor.

(b)      General Tax Indemnity.

(i)      Subject to the exclusions described in Section 8(b)(ii) below, any and all payments by the
         Borrower to the Administrative Agent or any Lender (each, a "Tax Indemnitee") under
         this Agreement or any of the other Operative Documents shall be made free and clear
         of and without deduction for any and all present or future taxes, levies,
         imposts, deductions, charges or withholdings, and all liabilities with respect
         thereto, excluding taxes measured by or based on net or taxable income (all
         such non-excluded taxes, levies, imposts, deductions, charges, withholdings
         and liabilities being hereinafter referred to as "Taxes").  If any Taxes shall
         be required by law to be deducted from or in respect of any sum payable under
         this Agreement to any Tax Indemnitee, then (i) the sum payable by the Borrower
         shall be increased as may be necessary so that after making all required
         deductions in respect of such Taxes (including deductions applicable to
         additional sums payable under this Section) such Tax Indemnitee (as the case
         may be) receives an amount equal to the sum it would have received had no such
         deductions been made, (ii) the Borrower shall make such deductions, and
         (iii) the Borrower shall pay the full amount deducted to the relevant taxation
         authority or other authority in accordance with applicable law.  The Borrower
         shall not, however, be required to pay amounts, if any, pursuant to clause (i)
         of the preceding sentence to any Tax Indemnitee organized under the laws of a
         jurisdiction outside of the United States of America unless such Tax
         Indemnitee provides or has provided to the Borrower a completed Internal
         Revenue Service Form W-8ECI or Form W-8BEN, or any successor form, or
         Form W-9, or any successor form, and any other applicable form, certificate or
         document prescribed by the Internal Revenue Service of the United States
         certifying as to such Tax Indemnitee's entitlement to an exemption from, or
         reduction of, United States withholding tax on payments to be made hereunder
         and any new or other forms or certificates prescribed by the Internal Revenue
         Service of the United States in the event that a lapse in time or change in
         circumstance renders a previous certification obsolete or inaccurate in any
         material respect.

                  The Borrower agrees to pay any present or future stamp, recording or
documentary taxes or similar levies that arise from any payment made under this
Agreement or under any other Operative Document or from the execution, delivery or
registration of, or otherwise with respect to, this Agreement or any other Operative
Document (hereinafter referred to as "Other Taxes").

                  The Borrower will indemnify each Tax Indemnitee on an after-tax basis
for the full amount of Taxes or Other Taxes (including any Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this Section) paid by such Tax
Indemnitee  and any liability (including penalties, interest, additions to tax and
expenses) arising therefrom or with respect thereto, whether or not such Taxes or
Other Taxes were correctly or legally asserted.  The Borrower shall pay any
indemnification requested under this Section within 30 days from the date any Tax
Indemnitee or  their respective agent (as the case may be) makes written demand
therefor.

                  Within 30 days after the date of any payment of Taxes or Other Taxes,
the Borrower will furnish to the relevant Tax Indemnitee the original or a certified
copy of a receipt or other documents reasonably acceptable to the relevant Tax
Indemnitee evidencing payment of such Taxes or Other Taxes.

                  If, as a result of an assignment under Section 24(c)(iii) below, a
Person organized under the laws of a jurisdiction outside of the United States becomes
a Tax Indemnitee and payments to it to be made under this Agreement are exempt from
United States withholding tax, or are subject to such tax at a reduced rate under an
applicable tax treaty, then such assignee shall provide to the Borrower, promptly
following the date that it became a Tax Indemnitee and from time to time thereafter,
so long as it is lawfully able to do so in its reasonable judgment, a properly
completed and executed Internal Revenue Service Form W-8ECI or Form W-8BEN or
Form W-9, or any successor form, and any other applicable form, certificate document
prescribed by the Internal Revenue Service certifying as to such assignee's
entitlement to such exemption or reduced rate with respect to all payments to be made
to such assignee under this Agreement and any new or other forms or certificates
prescribed by the Internal Revenue Service of the United States in the event that a
lapse in time or change in circumstance renders a previous certification obsolete or
inaccurate in any material respect.  Unless the Borrower shall have received forms or
other documents reasonably satisfactory to it establishing that payments under this
Agreement are not subject to United States withholding tax, or are subject to such tax
at a rate under an applicable tax treaty, the Borrower shall, subject to its
obligations under Section 8(a), withhold taxes from such payments at the applicable
statutory rate in the case of payments to or for any Tax Indemnitee, if it is
organized under the laws of a jurisdiction outside the United States.

                  Within 30 days after written request from the Borrower the relevant
Tax Indemnitee, as appropriate, shall, so long as no Default or Event of Default shall
have occurred, execute and deliver to the Borrower such certificates, forms or other
documents which can be furnished consistent with the facts and applicable law, and
which are reasonably necessary for the Tax Indemnitee to obtain a refund of Taxes
indemnified by the Borrower under this Section (which shall be paid to the Borrower
promptly upon receipt).

                  Without prejudice to the survival of any other provision of this
Agreement, the agreements and obligations of the Borrower contained in this Section
shall survive the repayment in full of the Loans.

(ii)     Exclusions.  In addition to any exclusions described in Section 8(b)(i) above, the
         foregoing tax indemnity shall not apply to:

(A)      Taxes imposed on a Tax Indemnitee resulting from such Tax Indemnitee not claiming any applicable
                  exemption or rate reduction under any applicable law or treaty
                  (unless such Tax Indemnitee provides, at Borrower's expense, an
                  opinion of independent counsel, selected by such Tax Indemnitee and
                  reasonably acceptable to Borrower, that there is no reasonable basis
                  for such claim; provided that, Borrower notifies such Tax Indemnitee
                  in writing that any such exemption is available and such Tax
                  Indemnitee determines in good faith that neither it nor any Affiliate
                  will be adversely impacted by claiming any such applicable exemption);

(B)      Taxes imposed on a Tax Indemnitee resulting from such Tax Indemnitee failing to comply with
                  certification, information, documentation, reporting or similar
                  requirements concerning the nationality, residence, identity or
                  connection with the jurisdiction imposing such Taxes if such Tax
                  Indemnitee was aware of the requirement to comply and such Tax
                  Indemnitee's compliance is required by applicable law or treaty as a
                  precondition to relief or exemption from such Taxes and such Tax
                  Indemnitee was eligible for such relief or exemption, unless such
                  failure to comply was due to failure of Borrower timely to notify the
                  Tax Indemnitee in writing of such requirement or to provide
                  reasonable assistance in complying with such requirement or the Tax
                  Indemnitee determines in good faith that either it or any Affiliate
                  will be adversely impacted by so complying;

(C)      Taxes imposed on a Tax Indemnitee resulting from the actual gross negligence (other than gross
                  negligence or willful misconduct imputed or attributed to such Tax
                  Indemnitee by reason of its interest in the Aircraft, Engine or Part)
                  or willful misconduct of such Tax Indemnitee;

(D)      Taxes imposed upon a Tax Indemnitee as a result of any transfer by such Tax Indemnitee of the Aircraft,
                  Engine or Part or the Lease or any other Operative Document or of
                  such Tax Indemnitee's interest in any thereof unless such transfer is
                  requested by Borrower or occurs at a time when an Event of Default
                  has occurred and is continuing;

(E)      Taxes imposed upon any Tax Indemnitee in its individual capacity based on or measured by fees for
                  services rendered under the Operative Documents; and

(F)      Taxes imposed upon any Tax Indemnitee with respect to any period after (1) the termination of the
                  Mortgage, in accordance with the terms thereof and (2) payment of all
                  amounts payable under the Operative Documents having been made.

                                    (For purposes of this Agreement and the other
                  Operative Documents, Taxes, other than those exempted in
                  Section 8(b)(i) or by virtue of clauses (A) through (F) above, are
                  hereinafter referred to as "Indemnified Taxes".)

                                    In the event of a dispute between Borrower and any
                  Tax Indemnitee regarding the applicability of any of the exclusions
                  described in Section 8(b)(i) or Section 8(b)(ii) or the amount of any
                  Indemnified Taxes, Borrower within 30 days of demand therefor shall
                  pay to such Tax Indemnitee any amount of Tax claimed to be owed
                  pursuant to Section 8(b)(i), as the case may be.  Any payment made by
                  Borrower pursuant to the immediately preceding sentence shall be
                  refunded by the relevant Tax Indemnitee if it subsequently is on a
                  final and unconditional basis established that such amount was not
                  required to be paid under this Section 8(b)(i) or (b)(ii) hereof, as
                  the case may be.

(iii)    Contest.  If a claim is made against any Tax Indemnitee for any Indemnified Taxes (a "Claim"), such Tax
         Indemnitee will, as promptly as practical after such Tax Indemnitee has
         received written notification of such Claim, give Borrower written notice of
         such Claim; provided that, that a failure to give such notice in a timely
         manner shall not preclude a Claim for indemnification hereunder except to the
         extent that the Borrower is prejudiced as a result of the failure to give such
         notice in a timely fashion.  If Borrower so requests in writing within
         thirty (30) calendar days after receipt of such notice, such Tax Indemnitee
         shall consult with Borrower to consider what action may be taken to resist
         payment of the relevant Indemnified Taxes and following such consultation such
         Tax Indemnitee may take any reasonable action in the name of such Tax
         Indemnitee to contest the Claim in the name of such Tax Indemnitee or, in such
         Tax Indemnitee's sole discretion, in the name of Borrower, to the extent
         permitted by law; provided that, the following conditions are met:

(A)      such Tax Indemnitee shall have received adequate provision satisfactory to it for such Claim and any
                  liability, expense or loss arising out of or related to such contest
                  (including without limitation indemnification for all costs,
                  expenses, losses, reasonable legal and accounting fees and
                  disbursements, penalties and interest);

(B)      the contest will not result in any danger of the sale, forfeiture or loss of, or the creation of any
                  Lien on, the Aircraft, any Engine, any Part, or any interest therein
                  unless bonded in a manner and amount acceptable to the Tax
                  Indemnitees;

(C)      if such contest shall be conducted in a manner requiring the payment of the Claim, Borrower shall have
                  paid such Claim to the extent required;

(D)      no Default or Event of Default shall have occurred and be continuing;

(E)      prior to commencing any administrative appeal, Borrower shall have acknowledged its liability to such
                  Tax Indemnitee hereunder for the contested amount;

(F)      such Tax Indemnitee shall have received a legal opinion (at the expense of Borrower) from counsel
                  selected by such Tax Indemnitee (and reasonably satisfactory to
                  Borrower) indicating that a reasonable basis for such contest exists;
                  and

(G)      such Tax Indemnitee has not received, or does not receive, an opinion from its external tax advisor
                  concluding that the proposed actions to contest such Claim would
                  trigger a significant possibility of creating a local franchise issue
                  of the Tax Indemnitee (e.g., adverse publicity or impairing of the
                  Tax Indemnitee's relationship with local regulators) or impairing the
                  status of other open tax matters (e.g., tax audits) between such Tax
                  Indemnitee and the local taxing authorities.

                                    Notwithstanding the foregoing provisions of this
                  Section 8(b)(iii), no Tax Indemnitee shall be obligated to contest a
                  Claim to the United States Supreme Court.  In addition,
                  notwithstanding the foregoing provisions of this Section 8(b), if at
                  any time such Tax Indemnitee waives its right of indemnification
                  under this Section 8(b) in respect of a Claim, or if, after having
                  received payment of indemnification from Borrower hereunder in
                  respect of such Claim, such Tax Indemnitee tenders such payment to
                  Borrower, then Borrower shall not be entitled to contest, or to
                  continue to contest, any such Claim.

(iv)     If by reason of any Indemnified Taxes paid or otherwise indemnified against by the Borrower
         pursuant to this Section 8(b), any Tax Indemnitee at any time actually realizes a net
         reduction in any Taxes not indemnified against by the Borrower and not
         previously taken into account in computing the amount of any indemnity payable
         by the Borrower under this Section 8(b), such Tax Indemnitee shall, so long as
         no Special Default or Event of Default shall have occurred, promptly pay to
         the Borrower an amount that, after subtraction of any further Tax savings such
         Tax Indemnitee realizes as a result of the payment thereof, is equal to the
         amount of such net Tax reduction; provided that any subsequent loss of Tax
         benefit for which payment has been made to the Borrower under this
         Section 8(b)(iv) (or was taken into account in computing an amount payable by
         the Borrower under this Section 8(b)) shall be treated as an indemnifiable Tax
         hereunder without regard to the exclusions set forth in Sections 8(b)(i) or
         8(b)(ii) hereof.

(v)      Verification.  At the Borrower's written request, the computation of the amount of any
         indemnity payment owed by the Borrower or any amount owed by a Tax Indemnitee to the Borrower
         pursuant to this Section 8 shall be verified and certified by an
         internationally recognized independent public accounting firm mutually
         selected by the Tax Indemnitee and the Borrower.  The costs of such
         verification (including the fee of such public accounting firm) shall be borne
         by the Borrower unless such verification shall result in an adjustment in the
         Borrower's favor of 5% or more of the net present value of the payment as
         computed by such Tax Indemnitee, in which case the costs shall be paid by such
         Tax Indemnitee.  Such determination shall be final and binding, absent
         manifest error on the part of the certified public accountants.  The Tax
         Indemnitees hereby agree to cooperate with the accountants in connection
         therewith, provided, however, notwithstanding anything that may be to the
         contrary in the Operative Documents, in no event shall the Borrower have the
         right to examine any information supplied to the verifying firm or the tax
         returns or books of the Tax Indemnitee in connection with the verifying
         procedures described herein or for any other reason.

(c)      Interest.  The Borrower will pay to each Indemnitee on demand, to the extent permitted
by applicable law, interest on any amount of indemnity not paid when due pursuant to this Section 8
until the same shall be paid, at the Past Due Rate.

Section 9.        Covenants of the Borrower.  (a)  Borrower Merger.  For so long as
the Mortgage remains in force, the Borrower shall not consolidate with or merge into or with any other
Person, and not convey, transfer, lease or otherwise dispose of all or substantially all of
its property and other assets to, or acquire all or any substantial part of the
property or other assets or capital stock of (if such acquisition is analogous in
either purpose or effect to a consolidation or merger), any other Person, unless:

(i)      Such transaction shall not have any material adverse effect on the rights of the Lenders or the
         Administrative Agent under or in respect of the Operative Documents or the
         Aircraft;

(ii)     The Person formed by or surviving such consolidation or merger or the Person which acquires by
         conveyance, transfer, lease or other disposition all or substantially all of
         such property and other assets or stock (the "Successor Entity"): (A) shall be
         a corporation organized and existing under the laws of the United Sates or any
         state thereof or the District of Columbia; (B) immediately after giving effect
         to such transaction, shall be the Borrower or shall have acquired or succeeded
         to all or substantially all of the property and other assets of the Borrower
         (if such assets are being transferred) as an entirety, and shall have a
         tangible net worth (determined in accordance with GAAP) of not less than the
         Borrower's tangible net worth (determined in accordance with GAAP) immediately
         prior to such transaction; (C) shall be a U.S. Air Carrier; and (D) shall
         execute and deliver to the Administrative Agent such recordations and filings
         with any Governmental Authority and such other documents as the Administrative
         Agent (at the direction of the Lenders) determines shall be reasonably
         necessary or advisable to evidence, or in connection with, such consolidation,
         merger, sale, lease, transfer or other disposition and an agreement, in form
         and substance reasonably satisfactory to the Administrative Agent (at the
         direction of the Lenders) which is a legal, valid, binding and enforceable
         assumption by such Successor Entity of the due and punctual performance and
         observance of each covenant and condition of the Borrower under the Operative
         Documents to which the Borrower is a party, and an officer's certificate to
         such effect and to the effect that the other requirements of this Section have
         been satisfied, and a legal opinion from counsel to such effect and otherwise
         in such form and substance reasonably satisfactory to the Administrative Agent
         (at the direction of the Lenders);

(iii)    Such Person shall have a credit rating (as determined by S&P or Moody's, as applicable) no
         worse than the Borrower's immediately prior to such transaction; and

(iv)     No Default shall have occurred and be continuing or shall occur as a result thereof.

         Upon any consolidation or merger in accordance with this Section 9(a), the
Successor Entity shall succeed to, and be substituted for, and may exercise every
right and power of, the Borrower under this Agreement with the same effect as if such
Successor Entity had been named as the Borrower herein.

(b)      U.S. Air Carrier.  The Borrower covenants and agrees that at all times it will be an "air carrier"
within the meaning of the Federal Aviation Act operating under certificates issued
pursuant to Section 40102(a) of such Act and shall otherwise meet the standards of the
definition of U.S. Air Carrier.

(c)      Further Assurances.  The Borrower covenants and agrees with each party hereto as follows:

(i)      The Borrower will cause to be done, executed, acknowledged and delivered all and every such further
         acts, conveyances and assurances as the Lenders shall reasonably require for
         accomplishing the purposes of this Agreement and the other Operative
         Documents; provided that any instrument or other document so executed by the
         Borrower will not expand any obligations or limit any rights of the Borrower
         in respect of the transactions contemplated by any Operative Documents.  The
         Borrower shall cause the Aircraft to remain duly registered, in the name of
         the Borrower, except as otherwise required or permitted hereunder or under the
         Mortgage, under the Federal Aviation Act.

(ii)     The Borrower, at its expense, will cause (A) the Mortgage, all Mortgage Supplements and all amendments
         to the Mortgage to be promptly filed and recorded, or filed for recording, to
         the extent permitted under the Federal Aviation Act, or required under any
         other applicable law and (B) the lien of the Mortgage to at all times be and
         remain a first priority and perfected Lien on the Mortgage Estate.  The
         Borrower agrees to furnish the Administrative Agent and the Lenders with
         copies of the foregoing documents with recording data as promptly as
         practicable following the issuance of same by the FAA.

(iii)    The Borrower shall pay all reasonable costs and expenses (including costs and disbursements of counsel)
         incurred by the Administrative Agent and the Lenders after the date hereof in
         connection with (x) any supplements or amendments of the Operative Documents
         (including, without limitation, any related recording costs) (other than any
         supplement or amendment associated with a transfer of any Note or the sale of
         participation interests therein not requested by Borrower), (y) any Default
         and any enforcement or collection proceedings resulting therefrom or in
         connection with the negotiation of any restructuring or "work-out" (whether or
         not consummated), or (z) the enforcement of this Section 9.

(d)      Liens.  The Borrower will not directly or indirectly create, incur, assume or suffer to
exist any Lien on or with respect to the Mortgage Estate, title thereto or any interest therein
except (i) the rights of the Borrower as herein provided, the Lien of the Mortgage and
any other rights existing pursuant to the Operative Documents, (ii) Liens for Taxes of
the Borrower either not yet due or being contested in good faith by appropriate
proceedings (and for which adequate reserves have been provided in accordance with
GAAP), so long as the continuing existence of such Liens during such proceedings do
not involve any material risk of the sale, forfeiture or loss of the Airframe or any
Engine or any interest therein, (iii) mechanics', material suppliers', workers',
repairers', employees' or other like Liens arising in the ordinary course of the
Borrower's business for amounts that are not overdue or are being contested diligently
and in good faith by appropriate proceedings (and for which adequate reserves have
been provided in accordance with generally accepted accounting principles), so long as
there is not, or the continuing existence of such Liens during such proceedings do not
involve, any material risk of sale, forfeiture or loss of the Airframe or any Engine
or any interest therein, (iv) Liens arising out of any judgment or award against the
Borrower with respect to which an appeal or proceeding for review is being prosecuted
diligently and in good faith, so long as such Liens do not result in a material risk
of the sale, forfeiture or loss of the Airframe or any Engine or any interest therein,
(v) the rights of others under agreements or arrangements to the extent expressly
permitted by the terms of Sections 3.03, 4.02 and 4.04 of the Mortgage, (vi) customary
salvage or similar rights of insurers under policies required to be maintained by the
Borrower under Article VI of the Mortgage, (vii) any other Lien with respect to which
the Borrower shall have provided a bond or other security in an amount and under terms
reasonably satisfactory to the Administrative Agent and (viii) Lender Liens.  The
Borrower will promptly, at its own expense, take (or cause to be taken) such actions
as may be necessary duly to discharge any Lien not excepted above if the same shall
arise at any time.

(e)      Inspection.  At reasonable times, the Administrative Agent or its authorized representatives
on behalf of the Lenders, may inspect the Aircraft and FAA (or other applicable governmental
authority) required books and records of the Borrower relating to the maintenance of
the Aircraft (at the inspecting party's expense (other than in the case of an
inspection occurring while an Event of Default has occurred and is continuing or if a
material deviation from the required Aircraft condition is discovered, in which case
the Borrower shall bear the reasonable cost of such inspection)) and shall keep any
information obtained thereby confidential as provided in Section 21 hereof.  Any such
inspection of the Aircraft shall be upon reasonable advance notice from such
inspecting party to the Borrower, shall be during normal business hours and shall be a
visual, walk-around inspection (including on-board inspection) and may include
inspection of areas exposed by any open panels, bays or the like, but shall not
include opening any panels, bays or the like without the express written consent of
the Borrower; provided that, so long as no Event of Default shall have occurred and be
continuing, no exercise of such inspection right shall interfere with the normal
operation or maintenance of the Aircraft by, or the business of, the Borrower.  The
Administrative Agent shall not have any duty to make any such inspection nor shall it
incur any liability or obligation by reason of not making any such inspection.

(f)      Amendments, Supplements, Etc.  Forthwith upon the execution and delivery of each Mortgage
Supplement from time to time required by the terms of the Mortgage and upon the execution and
delivery of any amendment to the Mortgage or this Agreement, the Borrower will cause
such Mortgage Supplement or amendment to be duly filed and recorded, and maintained of
record, in accordance with the applicable laws of the government of registry of the
Aircraft.  In addition, the Borrower will promptly and duly execute and deliver to the
Lenders and the Administrative Agent (on behalf of the Lenders) such further documents
and take such further action as the Lenders or the Administrative Agent (on behalf of
the Lenders) may from time to time reasonably request in order to more effectively
carry out the intent and purpose of the Mortgage and to establish and protect the
rights and remedies created or intended to be created in favor of the Administrative
Agent and the Lenders hereunder and under the Mortgage, including, without limitation,
if requested by the Administrative Agent, at the expense of Borrower, the execution
and delivery of supplements or amendments hereto, each in recordable form, subjecting
to the Mortgage any engine substituted for any Engine pursuant to the terms thereof
and the recording or filing of counterparts hereof, in accordance with the laws of
such jurisdiction as the Administrative Agent may reasonably request.

(g)      Access to or Furnishing of Information.  The Borrower agrees to furnish to the Administrative
Agent (and the Administrative Agent shall provide to the Lenders):

(i)      as soon as available, but not later than 90 days after the close of each fiscal year of the Borrower
         occurring after the date hereof, an audited balance sheet and related
         statements of the Borrower at and as of the end of such fiscal year, together
         with an audited statement of income and cash flows of the Borrower for such
         fiscal year, each of which shall be prepared in accordance with GAAP and shall
         be accompanied by an unqualified opinion of a firm of independent public
         accountants of nationally recognized standing that said financial statements
         fairly present in all material respects the financial condition and results of
         operation of the Borrower as at the end of, and for, such period in accordance
         with GAAP;

(ii)     as soon as available, but not later than 60 days after the close of each of the first three quarters of
         each fiscal year of the Borrower, an unaudited balance sheet of the Borrower
         at and as of the end of such quarter, together with an unaudited statement of
         income and cash flows of the Borrower for such quarter, each of which shall be
         prepared in accordance with GAAP, certified by the Chief Financial Officer of
         the Borrower that said financial statements fairly present in all material
         respects the financial condition and results of operation of the Borrower as
         at the end of, and for, such period in accordance with GAAP (subject to normal
         year-end audit adjustments);

(iii)    on an annual basis, together with the financial statements delivered pursuant to the preceding
         paragraph (i), a certificate of the chief financial officer, Treasurer, any
         Vice President, or other officer of the Borrower elected by the Borrower's
         Board of Directors stating that such authorized officer has reviewed the
         activities of the Borrower and that, to the best knowledge of such authorized
         officer, there exists no Default or Event of Default hereunder;

(iv)     simultaneously with the mailing thereof to its shareholders, copies of all such financial statements,
         SEC Forms 10-K and 10-Q reports, notices of proxy statements as the Borrower
         shall mail to its shareholders generally;

(v)      from time to time, such other information as the Administrative Agent or any Lender may reasonably
         request; and

(vi)     promptly after the occurrence thereof and actual knowledge thereof by a responsible officer of the
         Borrower, notice to the Administrative Agent and the Lenders of any Default or
         Event of Default.

(h)      Related Operative Documents.  The Borrower shall not amend any Related Operative Document
without the prior written consent of the Administrative Agent which consent shall not be
unreasonably withheld.

Section 10.       The Notes.  (a)  Method of Payment.  Principal and interest and other amounts due
hereunder or under the Notes or in respect hereof or thereof shall be payable in Dollars in
immediately available funds prior to 11:00 a.m., New York, New York time, on the due
date thereof, to the Administrative Agent at the Payment Office and the Administrative
Agent shall, subject to the terms and conditions hereof and of the Mortgage, remit all
such amounts so received by it to each Lender at the account set forth in Schedule I
hereto or to such other account or accounts as such Lender may designate to the
Administrative Agent in writing from time to time, in immediately available funds for
distribution to the Lenders, such payment to be made, in the case of any such
designated account in New York, New York, prior to 1:00 p.m., New York time, on the
due date thereof.  In the event the Administrative Agent shall fail to make any such
payment as provided in the immediately foregoing sentence after its receipt of funds
at the place and prior to the time specified above, the Administrative Agent agrees to
compensate the Lenders for loss of use of funds in a commercially reasonable manner.
All such payments by the Borrower and the Administrative Agent shall be made free and
clear of and without reduction on account of all wire and other like charges.  Prior
to the due presentment for registration of transfer of any Note, the Borrower and the
Administrative Agent may deem and treat the Person in whose name any Note is
registered on the Note Register as the absolute owner of such Note for the purpose of
receiving payment of all amounts payable with respect to such Note and for all other
purposes whether or not such Note shall be overdue, and neither the Borrower nor the
Administrative Agent shall be affected by any notice to the contrary.

(b)      Application of Payments.  Except as otherwise expressly provided herein, each payment of
principal and interest or other amounts due in respect of each Note shall be distributed to each
Lender ratably, without priority of any one Note over any other Note, in the
proportion that the amount of such payment or payments then due under each Note bears
to the aggregate amount of the payments then due under all Notes.  Each such payment
shall, except as otherwise expressly provided herein, be applied, first, to the
payment of any amount (other than the principal of or interest on such Note) due in
respect of such Note, second, to the payment of interest on such Note (as well as any
interest on overdue principal and, to the extent permitted by law, interest and other
amounts payable thereunder) due thereunder, third, to the payment of the principal of
such Note then due and fourth, the balance, if any, remaining thereafter, to the
payment of the principal of such Note remaining unpaid (provided that such Note shall
not be subject to prepayment without the consent of such Lender except as permitted by
Sections 10(f) and 10(g) hereof).  The amounts paid pursuant to clause fourth above
shall be applied to the installments of principal of such Note in inverse order of
maturity.

(c)      Registration, Transfer and Exchange of Notes.  The Administrative Agent agrees with the
Borrower that the Administrative Agent shall keep a register (herein sometimes referred to as the
"Note Register") in which provision shall be made for the registration of Notes and the
registration of transfers of Notes.  Prior to the due presentment for registration of
the transfer of any Note, the Borrower and the Administrative Agent shall deem and
treat the Person in whose name such Note is registered on the Note Register as the
absolute owner of such Note, and the Lender for the purpose of receiving payment of
all amounts payable with respect to such Note, and for all other purposes whether or
not such Note is overdue, and neither the Borrower nor the Administrative Agent shall
be affected by notice to the contrary.  The Note Register shall be kept at the office
of the Administrative Agent or at the office of any successor Administrative Agent,
and the Administrative Agent is hereby appointed "Note Registrar" for the purpose of
registering Notes and transfers of Notes as herein provided.  Subject to Section 24(c)
hereof, upon surrender for registration of transfer of any Note at the Payment Office
and upon delivery by the Administrative Agent to the Borrower of such surrendered
Note, the Borrower shall execute, and the Administrative Agent shall deliver, in the
name of the designated transferee or transferees, one or more new Notes of a like
aggregate principal amount.  At the option of the Lender, its Notes may be exchanged
for other Notes of any authorized denominations, of a like aggregate principal amount,
upon surrender of the Notes to be exchanged at the Payment Office.  Each new Note
issued upon transfer or exchange shall be in a principal amount of at least $5,000,000
(except as may be necessary to evidence the entire outstanding principal amount of a
Note) and dated the Delivery Date.  Whenever any Notes are so surrendered for
exchange, the Borrower shall execute and deliver the Notes which the Lender making the
exchange is entitled to receive.  All Notes issued upon any registration of transfer
or exchange of Notes shall be the valid obligations of the Borrower evidencing the
same respective obligations, and entitled to the same security and benefits under the
Mortgage, as the Notes surrendered upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or exchange, shall
(if so required by the Administrative Agent) be duly endorsed, or be accompanied by a
written instrument of transfer in form satisfactory to the Administrative Agent duly
executed by the Lender or its attorney duly authorized in writing, and the
Administrative Agent may require evidence satisfactory to it as to the compliance of
any such transfer with the Securities Act and the securities laws of any applicable
state.  The Administrative Agent shall make a notation on each new Note or Notes of
the amount of all payments of principal previously made on the old Note or Notes with
respect to which such new Note is issued and the date to which interest accrued on
such old Note or Notes has been paid.  The Administrative Agent shall not be required
to register the transfer of or exchange any surrendered Notes as above provided during
the five calendar day period preceding the due date of any payment on such Notes.  The
Administrative Agent shall give the Borrower and the Lenders notice of each transfer
of a Note under this Section 10(c).  Any such transferee of a Note, by its acceptance
of a Note, agrees to the provisions of the Operative Documents applicable to the
Lenders, and shall be deemed to have covenanted to the parties to the Operative
Documents as to the matters covenanted by the original Lender therein; provided that
no transferee of a Note shall be entitled to receive any greater amount pursuant to
Section 10(h) of this Agreement than the transferor of such Note would have been
entitled to receive had no such transfer occurred.

(d)      Mutilated, Destroyed, Lost or Stolen Notes.  If any Note shall become mutilated, destroyed,
lost or stolen, the Borrower shall, upon the written request of the Lender, execute and
deliver in replacement thereof, a new Note in the same principal amount, dated the
date of such Note and designated as issued under the Mortgage.  If the Note being
replaced has become mutilated, such Note shall be surrendered to the Administrative
Agent and the original thereof shall be furnished to the Borrower by the
Administrative Agent.  If the Note being replaced has been destroyed, lost or stolen,
the Lender shall furnish to the Borrower and the Administrative Agent such security or
indemnity as may be reasonably required by them to hold the Borrower and the
Administrative Agent harmless and evidence satisfactory to the Borrower and the
Administrative Agent of the destruction, loss or theft of such Note and of the
ownership thereof; provided, however, that if the Lender is an original party hereto
or an Affiliate thereof or a bank or other financial institution with a net worth (or
capital and surplus, as the case may be) in excess of $500,000,000, the written notice
of such destruction, loss or theft and such ownership and the written undertaking of
the Lender delivered to the Borrower and the Administrative Agent to hold harmless the
Borrower and the Administrative Agent in respect of the execution and delivery of such
new Note shall be sufficient evidence, security and indemnity.

(e)      Payment of Expenses on Transfer.  Upon the issuance of a new Note or new Notes pursuant
to Sections 10(c) or (d), the Borrower and/or the Administrative Agent may require from
the party requesting such new Note or Notes payment of a sum sufficient to reimburse
the Borrower and/or the Administrative Agent for, or to provide funds for, the payment
of any tax or other governmental charge in connection therewith or any charges and
expenses connected with such tax or other governmental charge paid or payable by the
Borrower or the Administrative Agent.

(f)      Prepayment.  (i)  On at least ten Business Days' prior written notice, the Borrower may
prepay on the date specified in its notice of prepayment delivered pursuant to this Section 10(f) in
whole, or in part, the Notes then outstanding at the principal amount thereof (or
portion thereof to be repaid), together with accrued interest thereon to the date of
prepayment plus all Break Amount and Additional Costs, if any, and all other amounts
due to each Lender hereunder, thereunder and under the other Operative Documents;
provided that any partial prepayment shall be in an aggregate original principal
amount of at least $5,000,000 and in $1,000,000 multiples thereof, the amount thereof
shall be specified in such written notice and such partial prepayment shall be applied
to the remaining installments of the Loan in the inverse order of maturity.  The
Administrative Agent will give prompt notice to the Lenders of the Borrower's intent
to prepay any Note.

(ii)     On at least ten Business Days' prior written notice, the Borrower shall prepay on the date
         specified in its notice of prepayment delivered pursuant to this Section 10(f) the Notes in
         full, but not in part, together with accrued interest thereon to the date of
         prepayment plus all Break Amount and Additional Costs, if any, and all other
         amounts due thereunder and hereunder and under the other Operative Documents
         to the Lenders upon the occurrence of an Event of Loss with respect to the
         Aircraft; such prepayment shall, in any event, be no later than the last day
         permitted for such payment under Section 5.01 of the Mortgage.  The
         Administrative Agent will give notice of prepayment to the Lenders under this
         Section 10(f)(ii) promptly.

(iii)    Any notice of prepayment delivered pursuant to paragraph (i) or (ii) above shall be
         irrevocable if not revoked within five Business Days of the specified date of payment
         and shall identify the amount to be prepaid.

(g)      Provisions Relating to Prepayment.  (i)  Notice of prepayment having been given and not
revoked as aforesaid, the principal amount of the Notes so to be prepaid, plus accrued interest
thereon to the date of prepayment, together with the Break Amount and Additional
Costs, if any, herein provided, shall become due and payable on the prepayment date.

(ii)     On the date fixed for prepayment under Section 10(f), immediately available funds in Dollars
         shall be deposited by the Borrower in the account of the Administrative Agent at the
         place and by the time and otherwise in the manner provided in Section 10(a),
         in an amount equal to the principal amount of Notes to be prepaid together
         with accrued and unpaid interest thereon to the date fixed for such
         prepayment, all Break Amount and Additional Costs, if any, and all other
         amounts due to the Lenders hereunder, thereunder and under the other Operative
         Documents.

(iii)    Each Lender shall furnish to the Borrower, with a copy to the Administrative Agent, a certificate
         setting forth in reasonable detail the calculation of the amounts of Break
         Amount due to such Lender, which certificate shall be presumptively correct
         absent manifest error.

(iv)     The amount of any prepayment may not be reborrowed.

(h)      Increased Costs.  (i)  The Borrower shall pay to the Administrative Agent for the account of
each Lender from time to time such amounts as such Lender may determine to be necessary to
compensate such Lender for any increase in actual costs that such Lender determines
are attributable to its making, funding or maintaining its Commitment or the Loans or
any reduction in any amount receivable by such Lender hereunder in respect of any of
its Commitments or the Loans (such increases in costs and reductions in amounts
receivable, including amounts covered by clause (ii) below, being herein called
"Additional Costs"), resulting from any Regulatory Change that:

(A)      imposes any tax that is the functional equivalent of any reserve, special deposit or similar
                  requirement of the sort covered by clause (ii) below; or

(B)      imposes or modifies any reserve, special deposit or similar requirements (including any Reserve
                  Requirement) relating to any extensions of credit or other assets of,
                  or any deposits with or other liabilities of, any Lender (including,
                  without limitation, any of such loans or any deposits referred to in
                  the definition of "LIBOR" in Section 1.01 of the Mortgage), or any
                  such obligations; or

(C)      imposes any other condition affecting the Mortgage, or its Notes (or any of such extensions of
                  credit or liabilities) or any such obligation.

(ii)     Without limiting the effect of the foregoing provisions of this Section 10(h) (but without
         duplication), the Borrower shall pay to the Administrative Agent for account of any Lender
         from time to time on request such amount as the Lender may determine to be
         necessary to compensate such Lender (or, without duplication, the holding
         company of which such Lender is a subsidiary) for any increase in actual costs
         that it determines are attributable to the maintenance by such Lender (or any
         lending office or such holding company) of its Commitment or Loans hereunder,
         resulting from the implementation of any risk-based capital guideline, reserve
         requirement or other similar requirement hereafter issued by any Governmental
         Authority pursuant to any law or regulation or any interpretation,
         application, directive or request (whether or not having the force of law and
         whether or not failure to comply therewith would be unlawful so long as
         compliance therewith is standard banking practice in the relevant
         jurisdiction) (including, without limitation, implementing at the national
         level any Regulatory Change of the Basel Accord), the effect of which would be
         to reduce the return on investment of assets or equity in respect of its
         Commitments or Loans, including, without limitation, any such reduction
         attributable to any funding arrangements utilized in connection with the
         Loans; such compensation shall include, without limitation, an amount equal to
         any reduction of the rate of return on assets or equity of such Lender (or any
         lending office or such bank holding company) could have achieved but for such
         law, regulation, interpretation, directive or request.  For purposes of this
         Section 10(h)(ii), "Basel Accord" shall mean the proposals for risk-based
         capital framework described by the Basel Committee on Banking Regulations and
         Supervisory Practices in its paper entitled "International Convergence of
         Capital Measurement and Capital Standards" dated July, 1988, it being
         understood that, as at the date hereof, there has been no Regulatory Change of
         the Basel Accord (i.e., "Basel II" has not been adopted).

(iii)    Any Lender (or the Administrative Agent on its behalf) shall notify the Borrower of any event
         occurring after the date hereof entitling such Lender to compensation under
         paragraph (i) or (ii) of this Section 10(h) as promptly as practicable, but in
         any event within 60 days, after such Lender obtains actual knowledge thereof;
         provided that (A) such Lender shall, with respect to compensation payable
         pursuant to this Section 10(h) in respect of any Additional Costs resulting
         from such event, only be entitled to payment under this Section 10(h) for
         Additional Costs incurred from and after the date that is 60 days prior to the
         date such Lender (or the Administrative Agent on its behalf) does give such
         notice and (B) such Lender will use commercially reasonable efforts (at the
         Borrower's expense) to mitigate the amount of the Additional Costs associated
         with such event, including designating a different lending office for the
         Notes of such Lender affected by such event if such designation will avoid the
         need for, or reduce the amount of, such compensation and will not, in the sole
         opinion of such Lender, result in any economic, legal or regulatory
         disadvantage to such Lender (other than economic disadvantages for which the
         Borrower agrees to indemnify such Lender and which indemnity is acceptable to
         such Lender in its discretion acting reasonably based on its credit assessment
         of the Borrower).  Any such Lender (or the Administrative Agent on its behalf)
         will furnish to the Borrower an officer's certificate setting forth in
         reasonable detail (x) the events giving rise to such Additional Costs, (y) the
         basis for determining and allocating such Additional Costs and (z) the amount
         of each request by such Lender for compensation under paragraph (i) or (ii) of
         this Section 10(h) (subject, however, to any limitations such Lender may
         require in respect of disclosure of confidential information relating to its
         capital structure), together with a statement that the determinations and
         allocations made in respect of the Additional Costs comply with the provisions
         of this Section 10(h), including as provided in the last proviso of this
         paragraph (iii).  Determinations and allocations by any such Lender for
         purposes of this Section 10(h) of the effect of any Regulatory Change pursuant
         to paragraph (i) of this Section 10(h), or of the effect of capital maintained
         pursuant to paragraph (ii) of this Section 10(h), on its costs or rate of
         return of maintaining Notes or its funding, or on amounts receivable by it in
         respect of Notes, and of the amounts required to compensate such Lender under
         this Section 10(h), shall be conclusive absent manifest error, provided that
         such determinations and allocations are made on a reasonable basis and, in the
         case of allocations, are made fairly.

(iv)     If a Lender gives notice of a claim against the Borrower under this Section 10(h),
         the Borrower shall have the right (i) to require such Lender to sell its Notes to an
         institution designated by the Borrower in compliance with Section 24(c)(iii) of this
         Agreement for an amount equal to the outstanding principal amount thereof plus
         accrued interest thereon to the date of sale, together with the Break Amount
         and all other amounts owing thereto, if any, or (ii) to prepay the outstanding
         principal amount of Notes held by such Lender, together with accrued interest
         to the date of such prepayment and Break Amount, if any, and all other amounts
         owing thereto.

(v)      The Borrower shall not be required to make payments under this Section 10(h) to any Lender
         if (A) a claim hereunder arises solely through circumstances peculiar to such Lender
         and which do not affect commercial lenders similar to such Lender in the
         jurisdiction of organization of such Lender generally or (B) the claim arises
         out of a voluntary relocation by such Lender of its lending office (it being
         understood that any such relocation effected pursuant to Section 10(h)(iii)(B)
         is not "voluntary"), or (C) such Lender is required by the Borrower pursuant
         to Section 10(h)(iv) above to sell its Notes to a purchaser designated by the
         Borrower and fails to do so.

(vi)     Amounts payable by the Borrower under this Section 10(h) shall be payable by the Borrower
         within 30 days of demand therefor.

Section 11.       Events Of Default; Certain Rights of Administrative Agent.  (a)  Each of the
following events shall constitute an Event of Default (whether any such event shall be voluntary or
involuntary or come about or be effected by operation of law or pursuant to or in
compliance with any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):

(i)      The Borrower shall have failed to make a payment of any principal or interest due on any Note within
         five Business Days after the same shall have become due; or

(ii)     The Borrower shall have failed to make any payment of any amount hereunder or under the Operative
         Documents other than principal and interest on the Loan after the same shall
         have become due and such failure shall continue for ten Business Days after
         the Borrower's receipt of written demand therefor by the party entitled
         thereto; or

(iii)    The Borrower shall fail to procure and maintain (or cause to be procured and maintained), with respect
         to the Aircraft, insurance required to be maintained in accordance with the
         provisions of Article VI of the Mortgage or such insurance shall lapse or be
         canceled; or

(iv)     The Borrower shall have failed to perform or observe, or caused to be performed and observed,
         any other covenant or agreement to be performed or observed by it under any Operative
         Document, and such failure shall continue unremedied for a period of
         thirty (30) days after the Borrower's receipt of written notice thereof from
         the Administrative Agent or the Lenders; or

(v)      Any representation or warranty made by the Borrower in any Operative Document or any document or
         certificate furnished by the Borrower in connection therewith or pursuant
         thereto shall prove to have been incorrect, untrue, inaccurate or misleading
         in any respect that is materially adverse to the Lenders or the Administrative
         Agent in such party's reasonable judgment at the time made and shall remain
         material; or

(vi)     The commencement by the Borrower of a voluntary case under the federal bankruptcy laws, as now
         constituted or hereafter amended, or any other applicable federal or state
         bankruptcy, insolvency or other similar law in the United States, or the
         consent by the Borrower to the appointment of or taking possession by a
         receiver, liquidator, trustee, custodian, sequestrator (or other similar
         official) of the Borrower or for all or substantially all of its property, or
         the making by the Borrower of any assignment for the benefit of creditors or
         the Borrower shall take any corporate action to authorize any of the foregoing
         or to authorize a general payment moratorium; or

(vii)    The commencement of an involuntary case or other proceeding in respect of the Borrower under
         the federal bankruptcy laws, as now or hereafter constituted, or any other applicable
         federal or state bankruptcy, insolvency or other similar law in the United
         States or seeking the appointment of a receiver, liquidator, custodian,
         trustee, sequestrator (or similar official) of the Borrower or for all or
         substantially all of its property, or seeking the winding-up or liquidation of
         its affairs and the continuation of any such case or other proceeding remains
         undismissed and unstayed for a period of sixty (60) consecutive days, or an
         order, judgment or decree shall be entered in any proceeding by any court of
         competent jurisdiction appointing, without the consent of the Borrower, a
         receiver, trustee or liquidator of the Borrower, or for all or substantially
         all of its property, or sequestering of all or substantially all of the
         property of the Borrower and any such order, judgment or decree or appointment
         or sequestration shall be final or shall remain in force undismissed, unstayed
         or unvacated for a period of sixty (60) consecutive days after the date of
         entry thereof; or

(viii)   The Borrower fails or ceases to be a U.S. Air Carrier or shall have been suspended as a U.S.
         Air Carrier or shall otherwise no longer have all applicable licenses (or such licenses
         shall be suspended) necessary to operate as a commercial airline; or

(ix)     Immediately upon such time as the Mortgage ceases to create a valid, perfected first priority
         mortgage on the Airframe or Engine in favor of the Administrative Agent for any reason
         other than the failure of the Lenders to cause continuation statements to be
         filed to the extent required by the Uniform Commercial Code or the filing by
         or on behalf of the Lenders of a termination statement releasing the Airframe
         or Engine from the Lien of the Mortgage; or

(x)      An "Event of Default" shall have occurred and be continuing under (as defined in) the
         Related Credit Agreement or a "Lease Event of Default" shall have occurred and be continuing
         under (and as defined in) any Lease Transaction; or

(xi)     (i)  The Borrower shall default in the payment when due of any principal of or interest on,
         or fail to make a scheduled rental payment on, any of its other indebtedness or any lease
         obligation; or (ii) any event specified in any note, agreement, indenture,
         lease or other document evidencing or relating to any indebtedness or any
         lease obligation shall occur, and, after giving effect to any applicable
         notice and/or grace periods, the effect of such default (in the case of
         clause (i)) or event (in the case of clause (ii)) is to cause, or to permit
         the holder or holders of such indebtedness or lease obligation (or a trustee
         or agent on behalf of such holder or holders) to cause, such indebtedness or
         lease obligation to become due or to be terminated, or to be prepaid in full
         (whether by redemption, purchase, offer to purchase or otherwise), prior to
         its stated maturity; provided that, (x) the outstanding amount of such
         indebtedness and (y) the capitalized amount of such lease obligation shall,
         singly or in the aggregate, be in excess of $10,000,000.

(b)      Certain Rights of Administrative Agent.  (i)  Subject to Section 14(h), in anticipation of
receipt from Borrower of payment of sums due and owing hereunder or under any Operative Document,
the Administrative Agent shall have the option, but shall not be obligated to, advance
to the Lenders on any Interest Payment Date, as provided in Section 10(a) hereof, an
amount equal to that required to be paid to the Lenders by the Borrower on such
Interest Payment Date.

(ii)     The Administrative Agent shall not, as a result of exercising its option to make the advance
         described in Section 11(b)(i) above, obtain any Lien on the Mortgage Estate for or on
         account of costs or expenses incurred in connection with the exercise of such
         right, nor shall any claim of the Administrative Agent against the Borrower or
         any other party for the repayment of such costs or expenses impair the prior
         right and security interest of the Administrative Agent (on behalf of the
         Lenders) in and to the Mortgage Estate.  Upon any advance by the
         Administrative Agent to the Lenders as provided in Section 11(b)(i), the
         Administrative Agent shall be subrogated to the rights of the Lenders in
         respect of any late payment made by Borrower and interest at the Past Due Rate
         payable by the Borrower on account of its being overdue (but shall have no
         rights as a secured party hereunder), and thereafter, the Administrative Agent
         shall be entitled to receive such overdue payment and such interest; provided,
         that the Administrative Agent shall not be entitled to seek recovery of any
         such advance (or any payment in lieu thereof) except pursuant to the foregoing
         right of subrogation.

Section 12.       Remedies.  (a)  General; Acceleration.  (i)  If an Event of Default
shall have occurred and be continuing and so long as the same shall be continuing, then and in every such case,
the Administrative Agent may exercise any or all of the rights and powers and pursue
any and all of the remedies pursuant to this Section 12 and shall have and in
addition, may exercise all of the rights and remedies of a secured party under the
Uniform Commercial Code.

(ii)     If an Event of Default referred to in Sections 11(a)(vi) or (vii) shall have occurred, then and
         in every such case (x) the Commitments shall automatically be cancelled and (y) the
         unpaid principal of all Notes then outstanding, together with interest accrued
         but unpaid thereon, and all other amounts payable to the Lenders thereunder
         and hereunder and under the other Operative Documents, shall, unless the
         Administrative Agent, acting upon the instructions of the Lenders shall
         otherwise direct, immediately and without further act become due and payable,
         without presentment, demand, protest or notice, all of which are hereby waived.

(iii)    If any other Event of Default shall have occurred and be continuing, then and in every such case,
         the Administrative Agent may at any time, by written notice or notices to the
         Borrower, (x) cancel the Commitments and/or (y) declare all the Notes to be
         due and payable, whereupon the Commitments shall be cancelled and the unpaid
         principal of all Notes then outstanding, together with interest accrued but
         unpaid thereon, and all other amounts payable to the Lenders thereunder,
         hereunder and under the other Operative Documents, shall immediately and
         without further act become due and payable without presentment, demand,
         protest or other notice, all of which are hereby waived.

(iv)     If the principal of the Notes shall have become due and payable pursuant to this Section 12(a),
         there shall also become due and payable, to the fullest extent permitted by law, to
         the Lenders upon demand, without presentment, protest or notice, all of which
         are hereby waived, the Break Amount and Additional Costs (if any) therefor.

(v)      The Lenders shall be entitled, at any sale pursuant to this Section 12, to credit against any
         purchase price bid at such sale by the Lenders all or any part of the unpaid
         obligations owing to the Lenders and secured by the Lien of the Mortgage.  The
         Administrative Agent and the Lenders shall, upon any such purchase, acquire
         good title to the property so purchased, to the extent permitted by applicable
         law, free of all rights of redemption.

(vi)     The Administrative Agent agrees to give to the Borrower at least ten days' prior written revocable
         notice of any foreclosure of the Lien of the Mortgage, or of any other action
         to cause the Borrower to lose its title in the Aircraft (which period of
         notice the parties hereto confirm is commercially reasonable).

(b)      Repossession and Sale.  At any time during the continuation of an Event of Default, the
Administrative Agent in addition to any rights it might otherwise have at law, may do either or both
of the following:

(i)      Upon the written demand of the Administrative Agent, and at the Borrower's expense, cause the
         Borrower to return promptly, and the Borrower shall return promptly, all or any part of
         the Aircraft as the Administrative Agent may so demand, to the Administrative
         Agent at a major airport on the Borrower's route system in one of the forty
         eight (48) contiguous states of the United States of America chosen by the
         Administrative Agent in the manner and condition required by Section 3.01 of
         the Mortgage, or, alternatively, the Administrative Agent at its option, may,
         to the extent permitted by law, peaceably enter upon the premises where all or
         any part of the Aircraft is located and take immediate possession of and
         remove the same by summary proceedings or otherwise (and, at the
         Administrative Agent's option store the same at the Borrower's premises until
         disposal thereof by the Administrative Agent), all without liability accruing
         to the Administrative Agent for or by reason of such entry or taking of
         possession or removal so long as the Administrative Agent has acted in
         accordance with the provisions of the Mortgage; provided that during any
         period the Aircraft is activated under CRAF in accordance with the provisions
         of Section 3.03 of the Mortgage and in the possession of the government of the
         United States of America or an instrumentality or agency thereof, the
         Administrative Agent shall not, on account of any Event of Default, be
         entitled to do any of the following in such manner as to limit the Borrower's
         control under the Mortgage of the associated Airframe or any Engines installed
         thereon, unless at least sixty (60) days' (or such lesser period as may then
         be applicable under the Military Airlift Command program of the government of
         the United States of America) prior written notice of default hereunder shall
         have been given by the Administrative Agent by registered or certified mail to
         the Borrower with a copy addressed to the Contracting Office Representative
         for the Military Airlift Command of the United States Air Force under the
         contract with the Borrower relating to the Aircraft; or

(ii)     with or without taking possession thereof, sell all or any part of the Aircraft at public or
         private sale, as the Administrative Agent may determine, or otherwise dispose of,
         hold, use, operate or lease to others, as the Administrative Agent, in its
         sole discretion, may determine, all free and clear of any rights of the
         Borrower, except as hereinafter set forth in this Section 12.

                  In addition, the Borrower shall be liable, except as otherwise
provided above and without duplication of amounts payable hereunder, for any and all
reasonable and actual legal fees and other costs and expenses incurred by the
Administrative Agent and the Lenders in connection with the enforcement of any of
their respective rights and remedies hereunder.

                  At any sale of the Aircraft or any part thereof pursuant to this
Section 12, the Administrative Agent on the Lenders' behalf, may bid for and purchase
such property.  The Administrative Agent on the Lenders' behalf, agrees to give the
Borrower at least ten days' written notice of the date fixed for any public sale of
the Airframe or any Engine or of the date on or after which will occur the execution
of any contract providing for any private sale (together with details thereof).
Except as otherwise expressly provided above, no remedy referred to in this Section 12
is intended to be exclusive, but each shall be cumulative and in addition to any other
remedy referred to above or otherwise available to the Administrative Agent at law or
in equity; and the exercise or beginning of exercise by the Administrative Agent of
any one (1) or  more of such remedies shall not preclude the simultaneous or later
exercise by the Administrative Agent of any or all of such other remedies.  No express
or implied waiver by the Administrative Agent of any Event of Default shall in any way
be, or be construed to be, a waiver of any future or subsequent Event of Default.

(c)      Taking of Aircraft.  (i)  If an Event of Default shall have occurred and be continuing,
at the request of the Administrative Agent, the Borrower shall promptly execute and deliver to the
Administrative Agent such instruments of title and other documents as the
Administrative Agent may deem necessary or advisable to enable the Administrative
Agent or an agent or representative designated by the Administrative Agent, at such
time or times and place or places as the Administrative Agent may specify, to obtain
possession of all or any part of the Mortgage Estate to which the Administrative Agent
shall at the time be entitled hereunder.  If the Borrower shall for any reason fail to
execute and deliver such instruments and documents after such request by the
Administrative Agent, the Administrative Agent may (A) obtain a judgment conferring on
the Administrative Agent the right to immediate possession and requiring the Borrower
to execute and deliver such instruments and documents to (or as delivered by) the
Administrative Agent, to the entry of which judgment the Borrower hereby specifically
consents, and (B) pursue all or part of the Mortgage Estate wherever such Mortgage
Estate may be found and may peaceably enter any of the premises of the Borrower
wherever it may be or be supposed to be and search for and take possession of and
remove the same.  All expenses of obtaining such judgment or of pursuing, searching
for and taking such property shall, until paid, be secured by the Lien of the Mortgage.

(ii)     Upon every such taking of possession, the Administrative Agent may, from time to time,
         at the expense of the Mortgage Estate, make all such expenditures for maintenance, insurance,
         repairs, replacements, alterations, additions and improvements to and of the
         Mortgage Estate, as it may deem proper.  In each such case, the Administrative
         Agent shall have the right to maintain, use, operate, store, lease, control or
         manage the Mortgage Estate and to carry on the business and to exercise all
         rights and powers of the Borrower relating to the Mortgage Estate, as the
         Administrative Agent shall deem best, including the right to enter into any
         and all such agreements with respect to the maintenance, insurance, use,
         operation, storage, leasing, control, management or disposition of the
         Mortgage Estate or any part thereof as the Administrative Agent may determine;
         and the Administrative Agent shall be entitled to collect and receive directly
         all tolls, rents, revenues, issues, income, products and profits of the
         Mortgage Estate and every part thereof.  Such tolls, rents, revenues, issues,
         income, products and profits shall be applied to pay the expenses of the use,
         operation, storage, leasing, control, management or disposition of the
         Mortgage Estate and of conducting the business thereof, and of all
         maintenance, repairs, replacements, alterations, additions and improvements,
         and to make all payments which the Administrative Agent may be required or may
         elect to make, if any, for taxes, assessments, insurance or other proper
         charges upon the Mortgage Estate or any part thereof (including the employment
         of engineers and accountants to examine, inspect and make reports upon the
         properties and books and records of the Borrower), and all other payments
         which the Administrative Agent may be required or authorized to make under any
         provision of the Mortgage, as well as just and reasonable compensation for the
         services of the Administrative Agent pursuant to this Section 12(c)(ii), and
         of all persons properly engaged and employed by the Administrative Agent.

(d)      Discontinuance of Proceedings.  In case the Administrative Agent (on its own behalf, or on
behalf of the Lenders) shall have instituted any proceeding to enforce any right, power or remedy
under the Mortgage by foreclosure, entry or otherwise, and such proceedings shall have
been discontinued or abandoned for any reason or shall have been determined adversely
to the Administrative Agent, then and in every such case, the Administrative Agent and
the Borrower shall, subject to any determination in such proceedings, be restored to
their former positions and rights hereunder with respect to the Mortgage Estate, and
all rights, remedies and powers of the Administrative Agent shall continue as if no
such proceedings had been instituted.

(e)      Waiver of Past Defaults.  The Administrative Agent, upon written instructions from the
Majority Lenders, shall waive any past Default or Event of Default hereunder and its consequences and
upon any such waiver such Default or Event of Default shall cease to exist and any
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Agreement, but no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any right consequent thereon.

(f)      Remedies Cumulative.  Each and every right, power and remedy given to the Administrative
Agent or the Lenders specifically or otherwise herein shall be cumulative and shall be in addition
to every other right, power and remedy herein specifically given or now or hereafter
existing at law, in equity or by statute, and each and every right, power and remedy
whether specifically herein given or otherwise existing may be exercised from time to
time and as often and in such order as may be deemed expedient by the Administrative
Agent or the Lenders and the exercise or the beginning of the exercise of any power or
remedy shall not be construed to be a waiver of the right to exercise at the same time
or thereafter any other right, power or remedy.  No delay or omission by the
Administrative Agent or the Lenders in the exercise of any right, remedy or power or
in the pursuit of any remedy shall impair any such right, power or remedy or be
construed to be a waiver of any default on the part of the Borrower or to be an
acquiescence therein.

(g)      Payment After Event of Default, etc.  All payments received and amounts held or
realized by the Administrative Agent after an Event of Default shall have occurred and so long as
such Event of Default shall be continuing, and after the Notes shall have been accelerated
pursuant to Section 12(a) hereof or after the Lenders or the Administrative Agent
shall foreclose or enforce the Mortgage or after the Notes shall have become due and
payable as provided in Section 12(a)(ii) or (iii), as well as all payments or amounts
then held by the Administrative Agent as part of the Mortgage Estate, shall be
promptly distributed by the Administrative Agent in the following order of priority:

                  first, so much of such payments or amounts as shall be required to
         reimburse the Administrative Agent for any tax, expense, charge or other loss
         (including, without limitation, all amounts to be expended at the expense of,
         or charged upon the tolls, rents, revenues, issues, income, products and
         profits of, the property included in the Mortgage Estate pursuant to
         Section 12(c)(ii)) incurred by the Administrative Agent (to the extent not
         previously reimbursed) (including, without limitation, the expenses of any
         sale, taking or other proceeding, reasonable attorneys' fees and expenses,
         court costs, and any other expenditures incurred or expenditures or advances
         made by the Administrative Agent, in the protection, exercise or enforcement
         of any right, power or remedy or any damages sustained by the Administrative
         Agent, liquidated or otherwise, upon such Event of Default) shall be applied
         by the Administrative Agent in reimbursement of such expenses;

                  second, so much of such payments or amounts remaining as shall be
         required to pay in full to the Lenders all amounts payable thereto pursuant to
         any other Operative Document and secured hereunder (other than amounts payable
         pursuant to clause "third" of this Section 12(g)) to the Lenders and remaining
         unpaid, including Break Amount and Additional Costs, shall be distributed to
         such Persons, and if the aggregate amount remaining shall be insufficient to
         pay all such amounts in full, it shall be distributed ratably, without
         priority of such person over any other;

                  third, so much of such payments or amounts remaining as shall be
         required to pay in full the aggregate unpaid principal amount of and all
         accrued but unpaid interest to the date of distribution on, the Notes shall be
         distributed to the Lenders, and if the aggregate amount remaining shall be
         insufficient to pay all such amounts in full, it shall be distributed ratably,
         without priority of any such person over any other, in the proportion that the
         principal amount of and all accrued but unpaid interest to the date of
         distribution on, each Note bears to the aggregate principal amount of and all
         accrued but unpaid interest to the date of distribution on all Notes;

                  fourth, so much of such payments or amounts remaining or shall be
         required to pay in full the amounts owing to the Related Lenders and the
         Related Administrative Agent under the Related Operative Documents in
         accordance with Section 12(g) of the Related Credit Agreement; and

                  fifth, the balance, if any, of such payments or amount remaining
         thereafter shall be distributed to the Borrower or as a court of competent
         jurisdiction shall direct.

Section 13.       Replacement Engines.  (a)  Replacement Engines.  At any time
and from  time to time, any Engine which has been (or is to be treated as if the same had been) subject
to an Event of Loss and may be replaced under Section 5.02 of the Mortgage by a Replacement Engine
shall be replaced in accordance with the provisions of this Section 13(a) and the
Borrower shall, from time to time, direct the Administrative Agent to execute and
deliver to or as directed in writing by an appropriate instrument releasing such
Engine from the Lien of the Mortgage, the Administrative Agent on behalf of the
Lenders shall execute and deliver such instrument as aforesaid, but only upon receipt
by or deposit with the Administrative Agent of the following:

(i)      A written request from the Borrower, requesting such release and specifically describing the Engine(s)
         so to be released.

(ii)     A certificate signed by a duly authorized officer of the Borrower stating the following with respect to
         the replacement of any Engine:

(A)      the fair market value of the Replacement Engine as of the date of such certificate (which value shall
                  not be less than the then fair market value of the Engine requested
                  to be released, assuming such Engine was in the condition and repair
                  required to be maintained (but without regard to hours and cycles
                  until overhaul));

(B)      the fair market value of the Engine to be released (immediately prior to the date such Engine suffered
                  an Event of Loss);

(C)      that the release of the Engine so to be released will not impair the security of the Mortgage or be in
                  contravention of any of the provisions of the Mortgage;

(D)      that each of the conditions specified in Section 5.02 of the Mortgage with respect to such Replacement
                  Engine have been satisfied; and

(E)      that the Replacement Engine was first placed in service after October 22, 1994.

(b)      Mortgage Supplements for Replacements.  In the event of a Replacement Engine being substituted as
contemplated by Section 5.02 of the Mortgage, the Borrower and the Administrative
Agent agree for the benefit of the Lenders, subject to fulfillment of the conditions
precedent and compliance by the Borrower with its obligations set forth in
Section 5.02 of the Mortgage and the requirements of Section 13(a) with respect to such
Replacement Engine, to execute and deliver a Mortgage Supplement with respect thereto
as contemplated by Section 5.02 of the Mortgage, and, provided no Default or Event of
Default in each case under Section 11 hereof shall have occurred and be continuing, to
execute and deliver to the Borrower an appropriate instrument releasing the Engine
being replaced from the Lien of the Mortgage (which may be the Mortgage Supplement
that adds the Replacement Engine to the Mortgage).

(c)      Effect of Replacement.  In the event of the substitution of a Replacement Engine pursuant to
Section 5.02 of the Mortgage and Section 13(a) hereof, all provisions of this Agreement
and the Mortgage relating to an Engine or Engines being replaced shall be applicable
to such Replacement Engine or Engines with the same force and effect as if such
Replacement Engine or Engines were the same engine or engines as the Engine or Engines
being replaced but for the Event of Loss with respect to an Engine or Engines being
replaced.

Section 14.       The Administrative Agent.  (a)  Appointment, Powers and Immunities.  Each
Lender hereby appoints and authorizes Erste Bank der oesterreichischen Sparkassen AG ("Erste") to
act as its Administrative Agent hereunder and under the other Operative Documents with
such powers as are specifically delegated to the Administrative Agent by the terms of
this Agreement and of the other Operative Documents, together with such other powers
as are reasonably incidental thereto.  The Administrative Agent shall take all actions
delegated to it hereunder as an agent solely for the benefit of the Lenders.  The
Administrative Agent (which term as used in this sentence and in Section 14(c) and the
first sentence of Section 14(f) hereof shall include reference to its Affiliates and
its own and their Affiliates' officers, directors, employees and agents, or either of
them):  (i) shall have no duties or responsibilities except those expressly set forth
in this Agreement and in the other Operative Documents, and shall not by reason of
this Agreement or any other Operative Document be a trustee for the Lenders;
(ii) shall not be responsible to the Lenders for any recitals, statements,
representations or warranties contained in this Agreement or in any other Operative
Document, or in any certificate or other document referred to or provided for in, or
received by any of them under, this Agreement or any other Operative Document, or for
the value, validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement, any Note or any other Operative Document or any other document referred to
or provided for herein or therein or for any failure by the Borrower or any other
Person to perform any of its obligations hereunder or thereunder; (iii) shall not be
required to initiate or conduct any litigation or collection proceedings hereunder or
under any other Operative Document; (iv) shall not be responsible to the Lenders for
any action taken or omitted to be taken by it hereunder or under any other Operative
Document or under any other document or instrument referred to or provided for herein
or therein or in connection herewith or therewith, except for its own gross negligence
or willful misconduct; and (v) may be removed from its role as Administrative Agent by
the Lenders with or without cause and upon notice by Lenders to the Borrower.  The
Administrative Agent shall not assign its interest to any replacement agent who is not
a bank or financial institution with a net worth (or capital and surplus, as the case
may be) in excess of $500,000,000 without the Borrower's prior written consent, such
consent not to be unreasonably withheld.  The Administrative Agent may employ agents
and attorneys-in-fact and shall not be responsible for the negligence or misconduct of
any such agents or attorneys-in-fact selected by it in good faith.

(b)      Reliance by the Administrative Agent.  The Administrative Agent shall be entitled to
rely upon any certification, notice or other communication (including, without limitation, any
thereof by telephone, telecopy, telex, telegram or cable) believed by it to be genuine
and correct and to have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel, independent accountants and
other experts selected by the Administrative Agent.  As to any matters not expressly
provided for herein or in any other Operative Document, the Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, hereunder or
thereunder in accordance with instructions given by the Majority Lender or all of the
Lenders, as the case may be, as is required in such circumstance, and such
instructions of such Lender and any action taken or failure to act pursuant thereto
shall be binding on all of the Lenders.

(c)      Defaults.  The Administrative Agent shall not be deemed to have knowledge or notice of
the occurrence of a Default (other than the non-payment of principal of or interest on Notes) unless the
Administrative Agent have received notice from the Lenders or the Borrower specifying
such Default and stating that such notice is a "Notice of Default".  In the event that
the Administrative Agent receives such a notice of the occurrence of a Default, the
Administrative Agent shall give prompt notice thereof to the Lenders (and shall give
the Lenders prompt notice of each such non-payment).  The Administrative Agent shall
(subject to Section 16(a) hereof) take such action with respect to such Default as
shall be directed by the Majority Lenders, provided that, unless and until the
Administrative Agent shall have received such directions, the Administrative Agent may
(but shall not be obligated to) take such action, or refrain from taking such action,
with respect to such Default as it shall deem advisable in the best interest of the
Lenders except to the extent that this Agreement expressly requires that such action
be taken, or not be taken, only with the consent or upon the authorization of the
Majority Lenders.

(d)      Rights as Administrative Agent.  Erste (and any successor acting as Administrative Agent)
and its affiliates may (without having to account therefor to the Lenders) accept deposits
from, lend money to, make investments in and generally engage in any kind of loan,
trust or other business with the Borrower (and any of its subsidiaries or Affiliates)
as if it were not acting as the Administrative Agent, and Erste and its affiliates may
accept fees and other consideration from the Borrower for services in connection with
this Agreement or otherwise without having to account for the same to the Lenders.

(e)      Failure to Act.  Except for action expressly required of the Administrative Agent
hereunder and under the other Operative Documents, the Administrative Agent shall in all cases be
fully justified in failing or refusing to act hereunder and thereunder unless it shall
receive indemnification against any and all liability and expense that may be incurred
by it by reason of taking or continuing to take any such action.

(f)      Resignation or Removal of the Administrative Agent.  Subject to the appointment and
acceptance of a successor Administrative Agent as provided below, and subject further to the
penultimate sentence of this Section 14(f), the Administrative Agent may resign at any
time by giving notice thereof to the Lenders and the Borrower, and the Administrative
Agent may be removed at any time with or without cause by the Majority Lenders.  Upon
any such resignation or removal, the Majority Lenders shall have the right to appoint
a successor Administrative Agent.  If no successor Administrative Agent shall have
been so appointed by the Majority Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent's giving of notice of
resignation or the Lenders' removal of the retiring Administrative Agent, then the
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent.  Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative Agent or
shall thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations hereunder.  After any retiring
Administrative Agent's resignation or removal hereunder as Administrative Agent, the
provisions of this Section 14 shall continue in effect for its benefit in respect of
any actions taken or omitted to be taken by it while it was acting as the
Administrative Agent.  The Administrative Agent shall not assign its interest to any
replacement agent who is not a bank or financial institution with a net worth (or
capital and surplus, as the case may be) in excess of $500,000,000 without the
Borrower's prior written consent, such consent not to be unreasonably withheld.

(g)      Consents under Operative Documents.  Except as otherwise provided in Section 16(a)
hereof, the Administrative Agent may, with the prior consent of the Majority Lenders (but not
otherwise), consent to any modification, supplement or waiver under any of the
Operative Documents, provided that, without the prior consent of each Lender, the
Administrative Agent shall not (except as provided herein) release any collateral or
otherwise terminate any Lien under any Operative Document providing for collateral
security, or agree to additional obligations being secured by such collateral security
(unless the Lien for such additional obligations shall be junior to the Lien in favor
of the other obligations secured by such Operative Document), except that no such
consent shall be required, and the Administrative Agent is hereby authorized, to
release any Lien covering property which is the subject of a disposition of property
permitted hereunder or to which the Lenders have consented.

(h)      Non-Receipt of Funds by the Administrative Agent.  Unless the Administrative Agent
shall have been notified by the Lenders or the Borrower (the "Payor") prior to the date on
which the Payor is to make payment to the Administrative Agent of (in the case of the Lenders)
the proceeds of a Loan to be made by it hereunder or (in the case of the Borrower) a
payment to the Administrative Agent for account of one or more of the Lenders
hereunder (such payment being herein called the "Required Payment"), which notice
shall be effective upon receipt, that the Payor does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that the
Required Payment has been made and may, in reliance upon such assumption (but shall
not be required to), make the amount thereof available to the intended recipient(s) on
such date and, if the Payor has not in fact made the Required Payment to the
Administrative Agent, the recipient(s) of such payment shall, on demand, repay to the
Administrative Agent the amount so made available together with interest thereon in
respect of each day during the period commencing on the date such amount was so made
available by the Administrative Agent until the date the Administrative Agent recovers
such amount at a rate per annum equal to the Federal Funds Rate for such day and, if
such recipient(s) shall fail promptly to make such payment, the Administrative Agent
shall be entitled to recover such amount, from the Payor, together with interest as
aforesaid.

(i)      Prorata Sharing.  Except to the extent otherwise provided herein (i) each payment or
prepayment of principal of the Loans shall be distributed by the Administrative Agent pro rata in
accordance with each Lender's share of the Loans and (ii) each payment of interest on
the Loans by the Borrower shall be distributed by the Administrative Agent pro rata in
accordance with the amounts of interest due and payable to the Lender.

Section 15.       Investment Of Funds.  Any moneys held by the Administrative Agent as
security hereunder for Borrower's obligations shall, until paid to Borrower or otherwise
applied in accordance with the terms of the Operative Documents, be invested by the
Administrative Agent as Borrower may from time-to-time direct in writing (or orally
and confirmed in writing), but subject to availability at the Administrative Agent's
discretion (it being understood that absent such a direction, there shall be no
obligation to invest such moneys) in (a) obligations of, or guaranteed by, the United
States Government or agencies thereof, (b) open market commercial paper of any
corporation incorporated under the laws of the United States of America or any State
thereof rated at least "P-2" or its equivalent by Moody's or at least "A-2" or its
equivalent by S&P, (c) certificates of deposit issued by commercial banks organized
under the laws of the United States or of any political subdivision thereof having a
combined capital and surplus in excess of $750,000,000 which banks or their holding
companies have a rating of A or its equivalent by Moody's or S&P; provided, however,
that the aggregate amount at any one time so invested in certificates of deposit
issued by any one bank shall not exceed five percent (5%) of such bank's capital and
surplus, (d) Dollar denominated offshore certificates of deposit issued by, or
offshore time deposits with, any commercial bank described in (c) or any subsidiary
thereof, and (e) repurchase agreements with any financial institution having combined
capital and surplus of at least $750,000,000 with any of the obligations described in
clauses (a) through (d) as collateral, none of which investments (but exclusive of any
underlying investment that may be subject to a repo) shall have a term to maturity in
excess of 30 days.  There shall be promptly remitted to Borrower or its order (but no
more frequently than monthly) any gain (including interest received) realized as a
result of any such investment (net or any, fees, commissions and other expenses, if
any, incurred in connection with such investment) unless a Special Default or an Event
of Default shall have occurred and be continuing.  The Borrower shall be responsible
for any net loss realized as a result of any such investment and shall reimburse the
Administrative Agent on demand.

Section 16.       Supplements and Amendments to the Mortgage and Other Operative Documents.
(a)  Instructions of Lenders; Limitations.  (i) At any time and from time to time, at the
request of the Borrower the Administrative Agent (but only on the written direction or consent
of the Majority Lenders) shall execute a supplement to the Mortgage for the purpose of adding
provisions to, or changing or eliminating provisions of, the Mortgage as specified in
such request, provided, however, that, without the consent of each Lender, no such
amendment of or supplement to any such document, or waiver or modification of the
terms of any thereof, shall (i) modify any of the provisions of this Section 16(a) or
the definitions of the terms, "Majority Lenders" or "Operative Documents", contained
herein or in any other Operative Document, (ii) increase the principal amount of any
Note or reduce the amount or extend the time of payment of any amount owing or payable
under any Note or (except as provided in this Agreement) increase or reduce the Break
Amount or interest payable on any Note (except that only the consent of the Lender
holding any Note shall be required for any decrease in any amounts of or the rate of
Break Amount or interest payable on such Note or any extension for the time of payment
of any amount payable under such Note), (iii) reduce, modify or amend any indemnities
in favor of any Lender or in favor of or to be paid by the Borrower or alter the
definition of "Indemnitee" to exclude any Lender (except as consented to by each
Person adversely affected thereby), or (iv) release the Borrower from its obligations
in respect of the payment of the principal and interest then outstanding (or other
amounts payable therewith) or change any of the circumstances under which Stipulated
Insured Amount (or other amounts payable therewith) are payable.  This Section 16(a)
shall not apply to any mortgage or mortgages supplemental hereto permitted by, and
complying with the terms of, Section 13(b).  Notwithstanding the foregoing, without
the consent of each Lender, no such supplement to the Mortgage, or waiver or
modification of the terms thereof or of any other agreement or document shall
expressly permit the creation of any Lien on the Mortgage Estate or any part thereof,
except as therein expressly permitted, or deprive any Lender of the benefit of the
Lien of the Mortgage on the Mortgage Estate, except as provided in Sections 13(a) and
13(b) hereof or in connection with the exercise of remedies under Section 12 hereof.
Except as provided in this Section 16(a), the Administrative Agent shall not amend,
supplement or waive any of the terms of the Mortgage or this Agreement.

(b)      Administrative Agent Protected.  If, in the opinion of the institution acting as
the Administrative Agent hereunder any document required to be executed pursuant to the terms of
Section 16(a) affects any right, duty, immunity or indemnity with respect to it under
the Mortgage, the Administrative Agent may in its discretion decline to execute such
document.

(c)      Documents Mailed to the Lenders.  Promptly after the execution by the Administrative
Agent and the Lenders of any document entered into pursuant to Section 16(a), the Administrative
Agent shall mail, by certified mail, postage prepaid, a conformed copy thereof to each
Lender at its address shown on the Note Register, but the failure of the Borrower or
the Administrative Agent, to mail such conformed copies shall not impair or affect the
validity of such document.

Section 17.       Notices.  All notices, demands, instructions and other communications
required or permitted to be given to or made upon any party hereto shall be in writing and shall
be personally delivered or sent by registered or certified mail, postage prepaid, or by facsimile,
or by prepaid courier service, and shall be effective upon receipt.

         Unless otherwise specified in a notice sent or delivered in accordance with
the foregoing provisions of this Section 17, notices, demands, instructions and other
communications in writing shall be given to or made upon the respective parties hereto
at their respective addresses (or to their respective telex address or facsimile
numbers) as follows:  (a) if to the Borrower or the Administrative Agent, to the
respective addresses set forth in Section 7.06 of the Mortgage, (b) if to the Lenders,
to the respective addresses set forth on Schedule I hereto, or (c) if to any
subsequent lender, addressed to such lender its address set forth in the Note Register
maintained pursuant hereto.

         Notwithstanding anything to the contrary contained herein or in any of the
Operative Documents, and for the avoidance of doubt, any notice required to be given
by the Lenders hereunder or under any of the Operative Documents may also be given by
the Administrative Agent on the Lenders' behalf.  The Administrative Agent agrees to
give any notice so received to the Lenders.

Section 18.       Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.  (a)  This
Agreement shall in all respects be governed by, and construed in accordance with, the law of the
State of New York, including all matters of construction, validity and performance.

(b)      Each party hereby irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of the Supreme Court of the State of New York sitting in New
York County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such Federal
court.  Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law.  Nothing in this Agreement shall
affect any right that any party may otherwise have to bring any action or proceeding
relating to this Agreement against another party or its properties in the courts of
any jurisdiction.

(c)      Each party hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or hereafter have to the laying of
venue of any suit, action or proceeding arising out of or relating to this Agreement
in any court referred to in paragraph (b) of this Section.  Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such court.

(d)      Each party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 17.  Nothing in this Agreement will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.

(e)      EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED
ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, ADMINISTRATIVE AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

Section 19.       Costs and Expenses.  The Borrower shall reimburse the Administrative
Agent and the Lenders for all reasonable out-of-pocket expenses incurred by it in connection
with the negotiation and preparation of this Agreement and the other Operative Documents
(including the reasonable fees and expenses of its special counsel); provided that, if
a Delivery Date fails to occur due to the fault of the Administrative Agent or any
Lender (including the failure to obtain any necessary credit approval), the
Administrative Agent will be responsible for its own costs and expenses (including
legal fees and expenses); which costs and expenses shall be limited, in the case of
the failure of the second Delivery Date to occur, to the costs and expenses incurred
solely in connection with such second Delivery Date.  The Borrower is also liable for
all of its own out-of-pocket expenses incurred in connection with the negotiation,
preparation and the carrying out of its obligations under this Agreement and the other
Operative Documents (including the reasonable fees and expenses of all of its special
counsel).

Section 20.       Section 1110 Compliance.  Notwithstanding any provision herein or elsewhere
contained to the contrary, it is understood and agreed among the parties hereto that the transactions
contemplated by this Credit Agreement, and the other Operative Documents are expressly
intended to be, shall be and should be construed so as to be, entitled to the full
benefits of 11 U.S.C. Section 1110, as amended from time to time, and any successor
provision thereto.

Section 21.       Confidentiality.  Except to the extent otherwise required by applicable
law or, as required to be filed publicly with the Securities and Exchange Commission, or unless
the Borrower, the Lenders and the Administrative Agent shall otherwise consent in writing, each
party to this Agreement agrees to maintain the confidentiality of this Agreement (and
all drafts hereof and documents ancillary hereto) in its communications with third
parties other than any Indemnified Party and not to disclose, deliver or otherwise
make available to any third party (other than its directors, officers, employees,
rating agencies, accountants or counsel or to bank examiners or other regulatory
personnel) the original or any copy of all or any part of this Agreement (or any draft
hereof and documents ancillary hereto) except to an Indemnified Party.

         None of the Borrower, the Administrative Agent, or any of their respective
Affiliates shall issue any news release or make any public announcement pertaining to
the transactions contemplated by this Agreement and the Operative Documents without
the prior written consent of the other (which consent shall not be unreasonably
withheld) unless such news release or public announcement is required by applicable
law, in which case the parties shall consult with each other prior to the issuance of
such news release or public announcement.

         Notwithstanding anything herein, there is no restriction (either express or
implied) on any disclosure or dissemination of the tax structure or tax aspects of the
transaction contemplated by the Operative Documents.  Furthermore, each party hereto
acknowledges that it has no proprietary rights to any tax matters or tax idea
contemplated by the Operative Documents or to any element of the transaction structure
contemplated by the Operative Documents.

Section 22.       Covenants of the Administrative Agent and the Lenders.  (a)  Quiet Enjoyment.
The Administrative Agent and each Lender each agrees that neither it nor any of its
Affiliates, nor anyone acting on behalf of any such Person will interfere in the
Borrower's quiet enjoyment of the Aircraft so long as no Event of Default shall have
occurred and be continuing.

(b)      Lender Liens.  The Administrative Agent and each Lender hereby severally covenants and
agrees with each of the other parties hereto that so long as (i) it remains the Administrative
Agent or a Lender, as the case may be, and (ii) the Lien of the Mortgage on the Aircraft has
not been released in accordance with the terms of the Operative Documents, it will
(x) take such action as may be necessary to discharge any Lender Liens, if any, on the
Aircraft attributable to it or any of its Affiliates and (y) indemnify and hold
harmless the other parties hereto from and against any loss, cost or expense which may
be suffered or incurred by any such Person as a result of its failure to discharge and
satisfy any such Lender Lien.

(c)      Transfer Restrictions.  Each Lender covenants that (notwithstanding anything herein
or in any other Operative Document to the contrary) it will not transfer its Notes or any interest
under any of the Operative Documents unless the transferee makes the representation
and warranty contained in Section 7(b).

Section 23.       Leveraged Lease Financing.  Notwithstanding any provision herein or
elsewhere in the Operative Documents to the contrary notwithstanding, the Borrower may elect,
prior to the borrowing for the Aircraft contemplated by Section 2(a) hereof, to finance the
Aircraft as a leveraged lease financing and the Lenders agree to such utilization of
their Commitments for such purpose, subject to the satisfaction of the following terms
and conditions:

(a)      the Borrower shall provide at least 30 days' advance notice of its intention to effect such a
financing, which notice shall identify the equity investor (the "Owner Participant") and owner
trustee ("Lessor");

(b)      the identified Owner Participant shall have a tangible net worth of at least $50,000,000 (or
have its obligations guaranteed by a parent corporation with such a tangible net worth level),
shall be an active participant in the aircraft leveraged lease industry and the
identity of which (as well as that of the Lessor) shall be reasonably satisfactory to
the Lenders;

(c)      documentation for such transaction shall be in form and substance satisfactory to the Lenders
and shall:

(i)      contain terms and conditions concerning the Borrower and the Aircraft no less favorable to the
         Lenders than those binding on the Borrower contained in the Operative Documents; and

(ii)     contain debt/equity provisions as are consistent with market practice and reasonably satisfactory
         to the Lenders, but shall not, without the consent of the Lenders, contain any swap
         breakage cap or other limitation relating to any swap hedging transaction or
         the ability of the Lenders to recover any swap hedging transaction or the
         ability of the Lenders to recover any swap breakage losses ahead of recoveries
         by the Owner Participant of its investment;

(d)      the economic substance (e.g., loan amount, interest rate, payment periodicity, maturity date,
amortization profile and LIBOR) of the leveraged lease debt funded by the Lenders
shall be the same as that evidenced by the Notes under the Mortgage; provided that

(i)      the level of indebtedness may be reduced in part; and

(ii)     the amortization profile on the leveraged lease debt may be based on an optimized leveraged
         lease basis so long as (x) the final maturity is no later than 12 years following the
         Delivery Date, (y) the average life of such debt does not exceed 8 years
         (computed as of the Delivery Date) and (z) such amortization profile shall
         otherwise be mutually agreed by the Borrower and the Lenders on a good faith
         basis; and

(e)      the Borrower shall pay to the Lenders (i) the reasonable fees and expenses of their special
counsel in connection with the negotiation, drafting (by such special counsel of the related
indenture), execution and delivery of the documentation utilized to effect such
leveraged lease and (ii) any reasonable out-of-pocket (including travel) costs and
expenses of the Administrative Agent as a single representative for all of the Lenders
incurred in connection with the leveraged lease.

Section 24.       Miscellaneous.  (a)  The representations, warranties, indemnities and
agreements of the Borrower, the Administrative Agent and the Lenders and each party's obligations under
any and all thereof, shall survive the expiration or other termination of this
Agreement or any other Operative Document, except as expressly provided herein or
therein.

(b)      This Agreement may be executed by the parties hereto in separate counterparts, each of which
when so executed and delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.  Neither this Agreement nor any of the
terms hereof may be terminated, amended, supplemented, waived or modified, except by
an instrument in writing signed by the party or parties thereto.

(c)      (i)               This Agreement shall be binding upon and shall inure to the benefit of, and
shall be enforceable by, the parties hereto and their respective successors and permitted
assigns.

(ii)     The Borrower may not assign any of its rights or obligations under this Agreement or the
         other Operative Documents except to the extent expressly provided thereby.

(iii)    Subject to the provisions of clause (iv) below, any Lender may assign its Notes, in whole or in
         part, as provided hereunder and in Section 10(c) hereof, to any Person (including an
         Affiliate, another lender or other third party) which assignment shall be
         effected pursuant to an agreement substantially in the form of Exhibit B
         hereto.  In addition, any Lender may, with the prior written consent of the
         Borrower, assign, in whole or in part, its Commitment in respect of the
         Aircraft to any other Person capable of meeting its funding obligation in
         respect of the assigned Commitment, which assignment shall be effected
         pursuant to an agreement substantially in the form of Exhibit B hereto,
         appropriately modified to relate to the assignment of a Commitment.  Effective
         upon the assignment of any Commitment in accordance with this Section 24(c),
         such Lender shall be relieved of its obligations in respect of such Commitment
         to the extent the assignee thereof shall have become obligated in respect
         thereof.

(iv)     Any assignment or transfer by such Lender hereunder shall be subject to the following conditions:

(A)      The transferring Lender shall have first obtained the prior written consent of the Borrower, which
                  consent shall not be unreasonably withheld (provided that no such
                  consent shall be required if an Event of Default has occurred and is
                  continuing), unless the proposed transferee is a Permitted Transferee
                  in which case no such consent of the Borrower shall be required;

(B)      The transferring Lender shall send the Borrower a written notice of such proposed transfer, setting
                  forth the name and address of the proposed transferee, the amount of
                  the transferring Lender's Notes proposed to be transferred and the
                  proposed date on which such transfer will occur.  Other than in
                  respect of a transfer to a Permitted Transferee, Borrower will then
                  have three (3) Business Days to request such additional information
                  as it may reasonably require regarding such proposed transferee, or,
                  if no such additional information is requested and such proposed
                  transfer satisfies the other requirements of this Section 24(c), the
                  Borrower shall be deemed to have consented to such proposed
                  transfer.  In the event that the Borrower requests additional
                  information, it shall have three (3) Business Days from the time such
                  additional information is provided to reject such proposed transfer,
                  failing which, subject to satisfaction of the other requirements of
                  this Section 24(c), the Borrower shall be deemed to have given its
                  consent;

(C)      as a result of any assignment or transfer, there shall be no more than three (3) lenders in the
                  aggregate;

(D)      no such assignment or transfer shall be in an amount less than $5,000,000;

(E)      so long as no Event of Default shall have occurred or be continuing, no assignment or transfer shall, at
                  the time of such assignment or transfer, increase the obligations
                  (including, without limitation, in respect of withholding taxes or
                  increased costs) of the Borrower under this Agreement or the
                  Mortgage; and

(F)      except as otherwise set forth herein, no participant in any Loan assigned or transferred hereunder
                  shall have any rights directly against the Borrower.

                  In the event a Lender, in accordance with this Section 24(c), assigns
its interest in any Loan, together with its interest herein and in the other Operative
Documents, in each case to the extent relating to such Loan, then all references to
"the Lender" hereunder shall mean and refer to such assignee to the extent of such
assignment, and any subsequent assignment by such assignee shall have a corresponding
effect.

                  Subject always to the foregoing, this Agreement inures to the benefit
of, and is binding upon, the successors and assigns of the parties hereto.

(v)      Notwithstanding the foregoing, the Administrative Agent may not assign or transfer its rights or
         obligations hereunder or under the other Operative Documents without the prior
         written consent of the Lenders, such consent not to be unreasonably withheld.

(vi)     All costs and expenses in connection with any assignment or transfer permitted by this Section 24(c)
         (including any legal fees of counsel to the parties to the Operative
         Documents) shall be borne by the relevant transferring/assigning lender,
         except in the case of an assignment or transfer that is effected at the
         request of the Borrower or if an Event of Default shall have occurred and be
         continuing, in which case such costs and expenses (including reasonable legal
         fees) shall be borne by the Borrower.

(d)      No Lender shall have any obligation or duty to the Borrower, or to other Persons with respect to the
transactions contemplated hereby except those obligations or duties of such Lender
expressly set forth in this Agreement and the other Operative Documents, and no Lender
shall be liable for performance by any other party hereto of such other party's
obligations or duties hereunder.  Without limitation of the generality of the
foregoing, under no circumstances whatsoever shall any Lender be liable to the
Borrower for any action or inaction on the part of the Administrative Agent in
connection with the transactions contemplated herein, whether or not such action or
inaction is caused by willful misconduct or gross negligence of the Administrative
Agent.

Section 25.       Terms of Fixed Rate Setting.  (a)  The Lenders, at the Borrower's
direction, shall cause the Applicable Rate for the Loan to be a fixed rate effective for the period
commencing on a date selected by Borrower during the term of the Notes (the "Swap Effective Date")
and ending on the final scheduled maturity date of the Notes issued in respect of the
Loan (the "Swap Period"); provided that if the proposed Swap Effective Date is not an
Interest Payment Date, the Borrower shall be liable for any LIBOR Break Amount.

(b)      Subject always to Section 25(h) below, if the Borrower desires the Applicable Rate to
become a Fixed Rate, it shall give the Lenders at least five Business Days' advance notice of such
intention. By 9:30 a.m. (New York City time) on the date three Business Days prior to
the Swap Effective Date, each Lender shall quote to the Borrower the fixed rate of
interest at which such Lender would be willing to lend to the Borrower.  No later than
two minutes after receipt of such quotation, the Borrower shall inform each Lender
whether it accepts or rejects such fixed rate quotation.  If such fixed rate quotation
is accepted, such quoted fixed rate (the "Fixed Rate") shall be the Applicable Rate
hereunder. Each Lender agrees to provide its quotation of a Fixed Rate in accordance
with market practice based upon the Notional Swap Transaction and as though such
Lender were the floating rate payor thereunder.

(c)      In the event the Applicable Rate is the Fixed Rate, on the date of (i) any prepayment of the
Notes pursuant to the Mortgage or this Agreement (ii) any acceleration of the Notes pursuant
to the Mortgage or this Agreement, each Lender will provide a quotation of the Swap
Break Amount, as it reasonably determines in good faith in accordance with the
definition thereof, representing the termination value of the Notional Swap
Transaction  by 12:00 noon New York City time on such date (the "Termination Date").

(d)      Each Lender agrees that, so long as no Special Default or Event of Default shall have
occurred and be continuing, it shall promptly pay to the Borrower at such account as the
Borrower may specify any Swap Breakage Gain in respect of the Notes, except that it may first
deduct therefrom any amounts then due to it (or, if acting as a swap agent, any
Lender) under the Operative Documents and apply any amount so retained to the
satisfaction thereof.  At such time as there shall not be continuing any such Special
Default or Event of Default, such amount shall be paid to the Borrower.

(e)      Upon the request of the Borrower, each Lender shall provide to the Borrower a good faith
estimate of the Swap Breakage Loss or Swap Breakage Gain, as the case may be, related to the Notes, in
connection with the occurrence, or anticipated occurrence, of any event contemplated
by the Operative Documents that might give rise to an obligation to pay Swap Breakage
Loss or Swap Breakage Gain.

(f)      Upon determination by a Lender of any Swap Breakage Loss or Swap Breakage Gain payable to or
by it, as the case may be, such Lender will provide to the Borrower a certificate, certifying
such Swap Breakage Loss or Swap Breakage Gain, which certified amount shall be
conclusive absent manifest error.  Any Swap Breakage Loss or Swap Breakage Gain
payable pursuant to the terms of the Operative Documents shall be payable in Dollars.

(g)      Each Lender agrees to provide its quotation of Swap Break Amount based upon the Notional Swap
Transaction and as though such Lender were the floating rate payor thereunder.

(h)      The Lenders shall not be obligated to cause the Applicable Rate for the Loans to be a fixed
rate on any date when the proposed fixed rate for the Loans exceeds either (x) 6.7% per annum or
(y) a rate equal to 1.2% over the Indicative Fixed Rate; it being understood that if
the Borrower requests to have the Applicable Rate fixed but the Lenders are not
obligated under this subsection (h) to comply with the Borrower's request, the
Borrower's right to request to have the Applicable Rate fixed will remain in full force
and effect throughout the remaining term of the Loan.

(i)      References in this Section 25 to any Lender shall, to the extent appropriate, mean such
Lender in its own right or acting through a swap agent.

                                [signature page follows]






                                                                                [Credit Agreement [Frontier/2002-B]]

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective officers thereunto duly authorized as of the day and year
first above written.

                                                           FRONTIER AIRLINES, INC.,
                                                           Borrower


                                                           By:________________________
                                                                Name:
                                                                Title:


                                                           ERSTE BANK DER
                                                           OESTERREICHISCHEN SPARKASSEN
                                                           AG,
                                                           Administrative Agent

                                                           By:________________________
                                                                Name:
                                                                Title:




                                                           By:
                                                                Name:
                                                                Title:

                                                           LENDERS:


                                                           ERSTE BANK DER
                                                           OESTERREICHISCHEN SPARKASSEN AG


                                                           By:________________________
                                                                Name:
                                                                Title:


                                                           By:
                                                                Name:
                                                                Title:


                                                           LANDESBANK HESSEN-THURINGEN
                                                           GIROZENTRALE


                                                           By:________________________
                                                                Name:
                                                                Title:


                                                           By:________________________
                                                                Name:
                                                                Title:






                                                                               [Credit Agreement [Frontier/2002-B]]
                                       Schedule I

                              Notice & Account Information

Lenders

Notice to:

Erste Bank der oesterreichischen Sparkassen AG
68 Cornhill
London EC3V 3QE
England
Attention:  Stewart Tanner

Telephone: +(44-207) 621-5013
Telecopier: +(44-207) 283-7142

Payment Instructions

Bank Name:  Bank of America NT & SA
SWIFT Code:  [***]
Account No.: [***]
Account Name:  Erste Bank der oesterreichschen Sparkassen AG
SWIFT Code: [***]
ABA No.:  [***]
Reference: Frontier Airlines 2002-B

Landesbank Hessen-Thuringen Girozentrale
Main Tower
Neue Mainzer Strasse 52-58
60311 Frankfurt am Main
Germany
Attention:  Mr. Axel Zipser, Corporate/Asset Finance

Telephone:  +(49-69) 9132-4437
Telecopier:  +(49-69) 9132-4392

Payment Instructions

Bank Name:  Citibank NA, New York
Account No.: [***]
Account Name:  Landesbank Hessen-Thuringen
SWIFT Code: [***]
Reference:  Frontier Airlines 2002-B

[***] Represents material that has been omitted and filed separately with the Securities and
Exchange Commission under a Confidental Treatment Request.


                                      Schedule II

                            Participation in Original Amount

                [All amounts are expressed in millions of U.S. Dollars]


                                     % of
  Lender                        Original Amount              Commitment 

Erste Bank der
oesterreichischen
Sparkassen AG                         [***]%                         $[***]

Landesbank Hessen-
Thuringen Girozentrale                [***]%                         $[***]

[***] Represents material that has been omitted and filed separately with the Securities and
Exchange Commission under a Confidental Treatment Request.




                                                                                [Credit Agreement [Frontier/2002-B]]

                                       EXHIBIT A

                                form of borrowing notice

                                [LETTERHEAD OF BORROWER]


                                                                  ---------------------,
                                                                  2002

Erste Bank der oesterreichischen Sparkassen AG
68 Cornhill
London
EC3V 3QE
England

Landesbank Hessen-Thuringen Girozentrale
Main Tower
Neue Mainzer Strasse 52-58
60311 Frankfurt am Main
Germany

Ladies and Gentlemen:

         We refer to the Credit Agreement [Frontier/2002-B], dated as of July 16, 2002
(the "Credit Agreement", which term, if such agreement shall not have been executed
and delivered by the parties thereto prior to the date hereof, shall mean the most
recently circulated draft thereof), among Frontier Airlines, Inc., as borrower (the
"Borrower"), the lenders that are party thereto identified under the caption "Lenders"
on the signature pages thereto or that, pursuant to Section 24(c) thereof, shall
become a "Lender" thereunder (individually, a "Lender" and, collectively, the
"Lenders") and Erste Bank der oesterreichischen Sparkassen AG, as Administrative Agent
on behalf of the Lenders.  Capitalized terms used but not defined in this Borrowing
Notice shall have the meaning given such terms (whether by reference to another
document or otherwise) in the Credit Agreement.

         In accordance with Section 2 of the Credit Agreement, Borrower hereby requests
that a Loan be advanced by the Lenders on __________________ (the "Closing Date").
The Borrower elects Option [A/B].  The Borrower advises that the Loan will initially
bear interest at a [floating rate/fixed rate].  The Lenders are directed to pay
$__________ of the proceeds of the Commitment by wire transfer to the following
account:

                                    Credit Lyonnais
                                      New York, NY
                                        ABA #: [***]
                                      Account #: [***]
                              Attention: William McIlwain
                              Reference: Frontier MSN 1781

         Borrower agrees that it shall not postpone the Closing Date except as
expressly agreed between the parties in writing.  In the event of a postponement of
the Closing Date or other reduction or modification or termination of the related
Loan, Borrower shall compensate Lenders upon written request by Lenders for all
losses, damages, liabilities and reasonable expenses (including any losses and
expenses incurred on account of funds borrowed, contracted for or utilized for
purposes relating to the Loan or in connection with the re-employment or reinvestment
of such funds or an interruption of the use of such funds and including interest or
other such costs on funds borrowed until such funds are returned to their funding
source) that Lenders sustain as a result of (a) the failure of Borrower to borrow any
part of the Commitment of the Lenders, (b) the repayment or voluntary prepayment of
any portion of the Loan, (c) the failure of Borrower to prepay the Loan on a
prepayment date, (d) the repayment or prepayment of any portion of the Loan as a
result of the exercise by the Administrative Agent or any Lender of its remedies
following the occurrence of an Event of Default, or (e) the repayment or prepayment of
any portion of the Loan.  Compensation to the Lenders under this Borrowing Notice
shall include interest at the Applicable Rate on each Lender's Commitment from the
Closing Date and any Break Amounts and Additional Costs or and other amounts (other
than interest) payable by each Lender to providers of funds obtained by each Lender in
order to make its Commitment, and costs incurred by each Lender in redeploying funds
that were to be used by it to make its Commitment.

[***] Represents material that has been omitted and filed separately with the Securities
and Exchange Commission under a Confidental Treatment Request.

                                                              Very truly yours,


                                                           FRONTIER AIRLINES, INC.


                                                           By:________________________
                                                                Name:
                                                                Title






                                                                               [Credit Agreement [Frontier/2002-B]]

                                       EXHIBIT B

                              FORM OF ASSIGNMENT AGREEMENT

         ASSIGNMENT AGREEMENT [Frontier/2002-B] dated as of __________ __, ____ between
________________________________ (the "Assignee") and _____________________________
(the "Assignor").

                                        RECITALS

         WHEREAS, the Assignor is the holder of the Note No. ____ dated __________ __,
____ (the "Assignor's Note") issued under the Credit Agreement [Frontier/2002-B] dated
as of July 16, 2002 (the "Credit Agreement"), between Frontier Airlines, Inc., as
Borrower, the lenders that are party thereto identified under the caption "Lenders" on
the signature pages thereto or that, pursuant to Section 24(c) thereof, shall become a
"Lender" thereunder (individually, a "Lender" and, collectively, the "Lenders") and
Erste Bank der oesterreichischen Sparkassen AG, as Administrative Agent;

         WHEREAS, the Assignor proposes to assign to the Assignee $____________ of the
$_____________ Assignor's Note and a pro rata portion of all of the rights and
obligations of the Assignor under the Credit Agreement and the other Operative
Documents (as defined below) in respect thereof, on the terms and subject to the
conditions set forth herein, and the Assignee proposes to accept the assignment of
such rights and obligations from the Assignor on such terms and subject to such
conditions;

         NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:

         Section 1.  Definitions.  Unless otherwise defined herein, terms defined in
the Credit Agreement are used herein as therein defined.

         Section 2.  Assignment.  On __________ __, ____ (the "Effective Date"), and on
the terms and subject to the conditions set forth herein, the Assignor will sell,
assign and transfer to the Assignee, without recourse to or representation, express or
implied, by the Assignor (except as expressly set forth in Section 5 hereof), a
$___________ portion of the Assignor's Note and a pro rata portion of the rights and
obligations of the Assignor under the Credit Agreement and the other Operative
Documents in respect thereof (but not with respect to any indemnity or other claim,
interest thereon at the Past Due Rate and Break Amounts, if any, accrued and unpaid as
of the Effective Date or thereafter payable to the Assignor in respect of the period
prior to the Effective Date), and the Assignee shall accept such assignment from the
Assignor and assume all of the obligations of the Assignor accruing from and after the
Effective Date under the Credit Agreement and the other Operative Documents relating
to the Assignor's Note on such terms and subject to such conditions.  Upon the
satisfaction of the conditions set forth in Section 4 hereof, (A) the Assignee shall,
on the Effective Date, succeed to the rights and be obligated to perform the
obligations of a Lender under the Credit Agreement and the other Operative Documents,
and (B) the Assignor shall be released from its obligations under the Credit Agreement
and the other Operative Documents accrued from and after the Effective Date, in each
case to the extent such obligations have been assumed by the Assignee.

         Section 3.  Payments.  As consideration for the sale, assignment and transfer
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor, on the
Effective Date, in lawful currency of the United States and in immediately available
funds, to the account specified below its signature on the signature pages hereof, an
amount equal to $_______________.

         Section 4.  Conditions.  This Assignment Agreement shall be effective upon the
due execution and delivery of this Assignment Agreement by the Assignor and the
Assignee and the effectiveness of the assignment contemplated by Section 2 hereof is
subject to (a) the receipt by the Assignor of the payment provided for in Section 3
hereof [and the receipt by the Assignee of an up-front fee in the amount of $_______]
and (b) the delivery to the Administrative Agent of the Assignor's Note, duly endorsed
for [partial] transfer to the Assignee, together with a request in the form attached
hereto as Exhibit A that a new Note be issued to the Assignee and Assignor.

         Section 5.  Representations and Warranties of the Assignor.  The Assignor
represents and warrants as follows:  (a) the Assignor has full power and authority,
and has taken all action necessary to execute and deliver this Assignment Agreement
and any other documents required or permitted to be executed or delivered by it in
connection with this Assignment Agreement and to fulfill its obligations under, and to
consummate the transactions contemplated by, this Assignment Agreement, and no
governmental authorizations or other authorizations are required in connection
therewith, (b) the Assignor's interest in the Assignor's Note is free and clear of any
and all Liens created by or through the Assignor, (c) this Assignment Agreement
constitutes the legal, valid and binding obligation of the Assignor, enforceable
against the Assignor in accordance with its terms, and (d) the Assignor has received
no written notice of any Default having occurred and continuing on the date of
execution hereof.

         Section 6.  Representations and Warranties of the Assignee.  The Assignee
hereby represents and warrants to the Assignor that (a) the Assignee has full power
and authority, and has taken all action necessary to execute and deliver this
Assignment Agreement and any and all other documents required or permitted to be
executed or delivered by it in connection with this Assignment Agreement and to
fulfill its obligations under, and to consummate the transactions contemplated by,
this Assignment Agreement, and no governmental authorizations or other authorizations
are required in connection therewith, (b) this Assignment Agreement constitutes the
legal, valid and binding obligation of the Assignee, enforceable against the Assignee
in accordance with its terms, and (c) the Assignee has fully reviewed the terms of the
Operative Documents and has independently and without reliance upon the Assignor and
based on such information as the Assignee has deemed appropriate, made its own credit
analysis and decision to enter into this Assignment Agreement.

         Section 7.  Further Assurances.  The Assignor and the Assignee hereby agree to
execute and deliver such other instruments, and take such other action, as either
party may reasonably request in connection with the transactions contemplated by this
Assignment Agreement.

         Section 8.  Governing Law.  This Assignment Agreement shall be governed by,
and construed in accordance with, the law of the State of New York.

         Section 9.  Notices.  All communications between the parties or notices in
connection herewith shall be in writing, hand-delivered or sent by ordinary mail,
telex or facsimile transmitter, addressed as set forth on the signature pages hereof.
All such communications and notices shall be effective upon receipt.

         Section 10.  Binding Effect.  This Assignment Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors and
assigns.

         Section 11.  Interpretation.  The headings of the various sections hereof are
for convenience of reference only and shall not affect the meaning or construction of
any provision hereof.

         Section 12.  Integration of Terms.  This Assignment Agreement contains the
entire agreement between the parties relating to the subject matter hereof and
supersedes all oral statements and other writings with respect to the subject matter
hereof.

         Section 13.  Counterparts.  This Assignment Agreement may be executed in one
or more counterparts, each of which shall be an original but all of which, taken
together, shall constitute one and the same instrument.






                                                                               [Credit Agreement [Frontier/2002-B]]
                                                       EXHIBIT B

         IN WITNESS WHEREOF, the parties have caused this Assignment Agreement to be
executed and delivered by their duly authorized officers as of the date first above
written.

                                                           [ASSIGNEE]

                                                           By:________________________
                                                           Name:
                                                           Title:

                                                           Address for Notices:

                                                           Wire Instructions:


                                                           [ASSIGNOR]

                                                           By:________________________
                                                           Name:
                                                           Title:

                                                           Address for Notices:

                                                           Wire Instructions:








                                                                               Exhibit A

                                                                 to Assignment Agreement

                           Request for Note and Registration

                                                                  --------- --, ----


To:      Erste Bank der oesterreichischen Sparkassen AG,
         as Administrative Agent

Ladies and Gentlemen:

         We refer to the assignment by ____________________________ (the "Assignor"),
of certain of its rights and obligations with respect to Note No. ______ in the
principal amount of $____________ (the "Assignor's Note") to
___________________________ (the "Assignee"), pursuant to an Assignment Agreement
[Frontier/2002-B] dated as of _______ __, ____ between the Assignor and the Assignee.
Capitalized terms not otherwise defined herein shall have the meanings assigned
thereto in such Assignment Agreement.  The Assignor hereby delivers the Assignor's
Note to Erste Bank der oesterreichischen Sparkassen AG, in its capacity as
Administrative Agent.  The Assignor requests Borrower to issue to (i) the Assignee a
new Note (the "New Note") in the principal amount of $____________ and (ii) to the
Assignor a new Note (the "Assignor's New Note") in the principal amount of
$______________, each, with a [Delivery Date] issue date.

         The Administrative Agent is hereby instructed to pay all interest on the
portion of the Assignor's Note being assigned hereunder accrued through the date
hereof directly to Assignor on the Interest Payment Date such interest is payable and
paid.

         The Assignor requests the Administrative Agent to deliver the New Note to the
Assignee at its address set forth below and to deliver the Assignor's New Note to the
undersigned.

                                                           Very truly yours,

                                                           [ASSIGNOR]

                                                           By:________________________
                                                           Name:
                                                           Title:


                                                           [ASSIGNEE]

                                                           By:________________________
                                                           Name
                                                           Title:

                                                           Address for Notices:

                                                           Wire Instructions
Accepted and Agreed

ERSTE BANK DER
OESTERREICHISCHEN SPARKASSEN AG,
as Administrative Agent


By:_______________________
Name:
Title:





                                                                                [Credit Agreement [Frontier/2002-B]]
                                         EXHIBIT C

                           Terms of Notional Swap Transaction

            (capitalized terms used herein without definition shall have the meanings
    assigned thereto in the Definitions (as defined in the definition of Swap Form))

                  Trade Date:                      __________ __, ____1

                  Effective Date:                  __________ __, ____2

                  Termination Date:                __________ __, 2___3, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.

                  Notional Amount:                 The Notional Amount in effect for a
                                                   Calculation Period shall be the
                                                   amount set forth in Schedule I
                                                   attached hereto opposite the
                                                   applicable date beginning such
                                                   Calculation Period; provided,
                                                   however, that such dates are subject
                                                   to adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention only with respect to
                                                   determining the Floating Payments.
                  Fixed Payments

                  Fixed Rate Payer                 Party B. [Lender]

                  Fixed Rate
                  Payment Dates:                   The __ of every _________,
                                                   __________, ____________ and
                                                   ________4, beginning __________ __,
                                                   ____5 and ending on the Termination
                                                   Date, payable in arrears, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.

                  Fixed Rate
                  Period End
                  Dates:                           The __ of every __________,
                                                   ___________, ___________ and
                                                   ________6, beginning __________ __,
                                                   ____7 and ending on the Termination
                                                   Date (no adjustment of Period End
                                                   Dates).

                  Fixed Rate:                      _____%.8

                  Fixed Rate
                  Day Count
                  Fraction:                        30/360.

                  Compounding:                     Inapplicable.

                  Floating Payments

                  Floating
                  Rate Payer:                      Party A. [Lender or Swap Agent]

                  Floating Rate
                  Payment Dates:                   The ___ of every __________,
                                                    _________, __________ and _________9,
                                                   beginning __________ __, ____10 and
                                                   ending on the Termination Date,
                                                   payable in arrears, subject to
                                                   adjustment in accordance with the
                                                   Modified Following Business Day
                                                   Convention.

                  Floating Rate
                  Option:                          USD - LIBOR - BBA (except for first
                                                 Calculation Period).

                  Floating Rate for
                  first Calculation
                  Period:                          ___%11 (exclusive of Spread)

                  Spread:                          [1.65%][1.70%] - Option A/B

                  Designated                       [Except for first Calculation Period,
                  Maturity:                        three months for each Calculation
                                                   Period.]

                  Floating Rate                    Actual/360.
                  Day Count
                  Fraction:

                  Floating Rate                    Each Floating Rate Payment Date, exclusive
                  Reset Dates:                     of the last Floating Rate Payment Date.

                  Compounding:                     Inapplicable.

                  Business Day for                 London
                  Rate Setting:

                  Business Day for                 New York, Denver and London
                  Payments:






                                                                               [Credit Agreement [Frontier/2002-B]]
                                                       EXHIBIT C




                                       SCHEDULE I

                                         TO THE

                       CONFIRMATION OF THE RATE SWAP TRANSACTION

                               DATED __________ __, ____


               DATE12                                NOTIONAL AMOUNT13