SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 8-K


                                 CURRENT REPORT
                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934


                Date of Report (Date of earliest event reported):
                                 September 25, 1997


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


         Delaware                       0-09781                   74-2099724
(State or other jurisdiction    (Commission File Number)        (IRS Employer 
 of incorporation)                                           Identification No.)


2929 Allen Parkway, Suite 2010, Houston, Texas                    77019
  (Address of principal executive offices)                      (Zip Code)


                                 (713) 834-2950
              (Registrant's telephone number, including area code)


<PAGE>



Item 7.   Financial Statements and Exhibits.

          (c) Exhibits.  The  documents listed below are filed as Exhibits  with
reference to the Registration Statement on Form S-3 (Registration No. 333-31285)
of  Continental  Airlines,  Inc. The  Registration  Statement and the Prospectus
Supplement, dated  September  12, 1997, to the  Prospectus, dated July 23, 1997,
relate  to  the   offering  of   Continental   Airlines,   Inc.'s  Pass  Through
Certificates, Series 1997-3.


<TABLE>
<CAPTION>

          <S>       <C>
          4.1       Revolving Credit Agreement 1997-3A between  Wilmington Trust
                    Company,  Subordination  Agent  and  Borrower,  and ABN AMRO
                    Bank, N.V., Chicago Branch, as Liquidity Provider

          4.2       Revolving Credit Agreement 1997-3B between  Wilmington Trust
                    Company,  Subordination  Agent  and  Borrower,  and ABN AMRO
                    Bank, N.V., Chicago Branch, as Liquidity Provider

          4.3       Revolving Credit Agreement 1997-3C between  Wilmington Trust
                    Company,  Subordination  Agent  and  Borrower,  and ABN AMRO
                    Bank, N.V., Chicago Branch, as Liquidity Provider

          4.4       Pass Through Trust Agreement between  Continental  Airlines,
                    Inc. and Wilmington Trust Company, as Trustee

          4.5       Trust  Supplement  No.  1997-3A  Dated  September  25,  1997
                    between   Wilmington   Trust   Company,   as  Trustee,   and
                    Continental  Airlines,  Inc. to Pass Through Trust Agreement
                    Dated as of September 25, 1997

          4.6       Trust  Supplement  No.  1997-3B  Dated  September  25,  1997
                    between   Wilmington   Trust   Company,   as  Trustee,   and
                    Continental  Airlines,  Inc. to Pass Through Trust Agreement
                    Dated as of September 25, 1997

          4.8       Trust  Supplement  No.  1997-3C  Dated  September  25,  1997
                    between   Wilmington   Trust   Company,   as  Trustee,   and
                    Continental  Airlines,  Inc. to Pass Through Trust Agreement
                    Dated as of September 25, 1997

          4.9       Intercreditor  Agreement  among  Wilmington  Trust  Company,
                    Trustee,  ABN AMRO Bank,  N.V.,  Chicago  Branch,  Liquidity
                    Provider, and Wilmington Trust Company,  Subordination Agent
                    and Trustee

          4.10      Form of  Trust  Agreement  between  ICX  Corporation,  Owner
                    Participant,  and First Security Bank, National Association,
                    Owner Trustee

          4.11      Form of Trust Agreement between MetLife Capital Credit L.P.,
                    Owner  Participant,   and  First  Security  Bank,   National
                    Association, Owner Trustee


<PAGE>

          4.12      Form of Trust Agreement  between  Pacific  Century  Leasing,
                    Inc., Owner Participant,  and First Security Bank,  National
                    Association, Owner Trustee

          4.13      Form of Participation  Agreement among Continental Airlines,
                    Inc.,   Lessee,   Pacific  Century   Leasing,   Inc.,  Owner
                    Participant,  First  Security   Bank  National  Association,
                    Owner Trustee,  Wilmington Trust Company, Mortgagee and Loan
                    Participant, Corcim, Inc., Existing Lessor, Rolls-Royce plc,
                    Existing Mortgagee and Equity Guarantor and  Embraer-Empresa
                    Brasileira de Aeronautica S.A., Airframe Manufacturer

          4.14      Form of Participation  Agreement among Continental Airlines,
                    Inc.,  Lessee,  ICX Corporation,  Owner  Participant,  First
                    Security   Bank    National   Association,   Owner  Trustee,
                    Wilmington  Trust Company,  Mortgagee and Loan  Participant,
                    Corcim,  Inc.,  Existing Lessor,  Rolls-Royce plc,  Existing
                    Mortgagee   and   Equity   Guarantor   and   Embraer-Empresa
                    Brasileira de Aeronautica S.A., Airframe Manufacturer

          4.15      Form of Participation  Agreement among Continental Airlines,
                    Inc.,   Lessee,   MetLife   Capital   Credit   L.P.,   Owner
                    Participant,  First  Security  Bank   National  Association,
                    Owner Trustee,  Wilmington Trust Company, Mortgagee and Loan
                    Participant, Corcim, Inc., Existing Lessor, Rolls-Royce plc,
                    Existing Mortgagee and Equity Guarantor and  Embraer-Empresa
                    Brasileira de Aeronautica S.A., Airframe Manufacturer

          4.16      Form of Lease Agreement between First Security Bank National
                    Association,  Lessor and Continental Airlines,  Inc., Lessee
                    [Pacific Century Leasing, Inc., Owner Participant]

          4.17      Form of Lease Agreement between First Security Bank National
                    Association,  Lessor and Continental Airlines,  Inc., Lessee
                    [ICX Corporation, Owner Participant]

          4.18      Form of Lease Agreement between First Security Bank National
                    Association,  Lessor and Continental Airlines,  Inc., Lessee
                    [MetLife Capital Credit L.P., Owner Participant]

          4.19      Form of Trust Indenture and Mortgage  between First Security
                    Bank, National  Association,  Owner Trustee,  and Wilmington
                    Trust Company, Mortgagee

          23.1      Consent of Avmark, Inc.

          23.2      Consent of Simat, Helliesen & Eichner, Inc.

          23.3      Consent of Morten Beyer and Agnew


<PAGE>

          23.4      Consent of Avmark, Inc.

          23.5      Consent of Morten Beyer and Agnew

</TABLE>





<PAGE>


                                    SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, Continental
Airlines,  Inc.  has duly  caused  this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                            CONTINENTAL AIRLINES, INC.


                                            By  /S/ JEFFERY A. SMISEK
                                                --------------------------------
                                                Jeffery A. Smisek
                                                Executive Vice President
                                                and General Counsel

October 13, 1997



<PAGE>


                                  EXHIBIT INDEX


<TABLE>
<CAPTION>

          <S>       <C>
          4.1       Revolving Credit Agreement 1997-3A between  Wilmington Trust
                    Company,  Subordination  Agent  and  Borrower,  and ABN AMRO
                    Bank, N.V., Chicago Branch, as Liquidity Provider

          4.2       Revolving Credit Agreement 1997-3B between  Wilmington Trust
                    Company,  Subordination  Agent  and  Borrower,  and ABN AMRO
                    Bank, N.V., Chicago Branch, as Liquidity Provider
       

          4.3       Revolving Credit Agreement 1997-3C between  Wilmington Trust
                    Company,  Subordination  Agent  and  Borrower,  and ABN AMRO
                    Bank, N.V., Chicago Branch, as Liquidity Provider

          4.4       Pass Through Trust Agreement between  Continental  Airlines,
                    Inc. and Wilmington Trust Company, as Trustee

          4.5       Trust  Supplement  No.  1997-3A  Dated  September  25,  1997
                    between   Wilmington   Trust   Company,   as  Trustee,   and
                    Continental  Airlines,  Inc. to Pass Through Trust Agreement
                    Dated as of September 25, 1997

          4.6       Trust  Supplement  No.  1997-3B  Dated  September  25,  1997
                    between   Wilmington   Trust   Company,   as  Trustee,   and
                    Continental  Airlines,  Inc. to Pass Through Trust Agreement
                    Dated as of September 25, 1997

          4.8       Trust  Supplement  No.  1997-3C  Dated  September  25,  1997
                    between   Wilmington   Trust   Company,   as  Trustee,   and
                    Continental  Airlines,  Inc. to Pass Through Trust Agreement
                    Dated as of September 25, 1997

          4.9       Intercreditor  Agreement  among  Wilmington  Trust  Company,
                    Trustee,  ABN AMRO Bank,  N.V.,  Chicago  Branch,  Liquidity
                    Provider, and Wilmington Trust Company,  Subordination Agent
                    and Trustee

          4.10      Form of  Trust  Agreement  between  ICX  Corporation,  Owner
                    Participant,  and First Security Bank, National Association,
                    Owner Trustee

          4.11      Form of Trust Agreement between MetLife Capital Credit L.P.,
                    Owner  Participant,   and  First  Security  Bank,   National
                    Association, Owner Trustee


<PAGE>

          4.12      Form of Trust Agreement  between  Pacific  Century  Leasing,
                    Inc., Owner Participant,  and First Security Bank,  National
                    Association, Owner Trustee

          4.13      Form of Participation  Agreement among Continental Airlines,
                    Inc.,   Lessee,   Pacific  Century   Leasing,   Inc.,  Owner
                    Participant,  First  Security   Bank  National  Association,
                    Owner Trustee,  Wilmington Trust Company, Mortgagee and Loan
                    Participant, Corcim, Inc., Existing Lessor, Rolls-Royce plc,
                    Existing Mortgagee and Equity Guarantor and  Embraer-Empresa
                    Brasileira de Aeronautica S.A., Airframe Manufacturer

          4.14      Form of Participation  Agreement among Continental Airlines,
                    Inc.,  Lessee,  ICX Corporation,  Owner  Participant,  First
                    Security   Bank    National   Association,   Owner  Trustee,
                    Wilmington  Trust Company,  Mortgagee and Loan  Participant,
                    Corcim,  Inc.,  Existing Lessor,  Rolls-Royce plc,  Existing
                    Mortgagee   and   Equity   Guarantor   and   Embraer-Empresa
                    Brasileira de Aeronautica S.A., Airframe Manufacturer

          4.15      Form of Participation  Agreement among Continental Airlines,
                    Inc.,   Lessee,   MetLife   Capital   Credit   L.P.,   Owner
                    Participant,  First  Security  Bank   National  Association,
                    Owner Trustee,  Wilmington Trust Company, Mortgagee and Loan
                    Participant, Corcim, Inc., Existing Lessor, Rolls-Royce plc,
                    Existing Mortgagee and Equity Guarantor and  Embraer-Empresa
                    Brasileira de Aeronautica S.A., Airframe Manufacturer

          4.16      Form of Lease Agreement between First Security Bank National
                    Association,  Lessor and Continental Airlines,  Inc., Lessee
                    [Pacific Century Leasing, Inc., Owner Participant]

          4.17      Form of Lease Agreement between First Security Bank National
                    Association,  Lessor and Continental Airlines,  Inc., Lessee
                    [ICX Corporation, Owner Participant]

          4.18      Form of Lease Agreement between First Security Bank National
                    Association,  Lessor and Continental Airlines,  Inc., Lessee
                    [MetLife Capital Credit L.P., Owner Participant]

          4.19      Form of Trust Indenture and Mortgage  between First Security
                    Bank, National  Association,  Owner Trustee,  and Wilmington
                    Trust Company, Mortgagee

          23.1      Consent of Avmark, Inc.

          23.2      Consent of Simat, Helliesen & Eichner, Inc.

          23.3      Consent of Morten Beyer and Agnew


<PAGE>

          23.4      Consent of Avmark, Inc.

          23.5      Consent of Morten Beyer and Agnew


</TABLE>







================================================================================


                           REVOLVING CREDIT AGREEMENT
                                    (1997-3A)



                         Dated as of September 25, 1997

                                     between

                            WILMINGTON TRUST COMPANY,

                             as Subordination Agent,
                          as agent and trustee for the
                 Continental Airlines Pass Through Trust 1997-3A

                                   as Borrower

                                       and



                       ABN AMRO BANK N.V., CHICAGO BRANCH

                              as Liquidity Provider




                                   Relating to

                 Continental Airlines Pass Through Trust 1997-3A
             7.160% Continental Airlines Pass Through Certificates,
                                 Series 1997-3A


================================================================================





<PAGE>


<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

                                   ARTICLE I.

                                   DEFINITIONS

<S>             <C>                                                          <C>
Section 1.1     Certain Defined Terms......................................... 1

                                   ARTICLE II.

                       AMOUNT AND TERMS OF THE COMMITMENT

Section 2.1     The Advances...................................................6
Section 2.2     Making the Advances............................................7
Section 2.3.    Fees...........................................................9
Section 2.4.    Adjustments or Termination of the Maximum Commitment...........9
Section 2.5.    Repayments of Interest Advances or the Final Advance...........9
Section 2.6.    Repayments of Provider Advances...............................10
Section 2.7.    Payments to the Liquidity Provider Under the Intercreditor
                Agreement.....................................................11
Section 2.8.    Book Entries..................................................11
Section 2.9.    Payments from Available Funds Only............................11

                                  ARTICLE III.

                           OBLIGATIONS OF THE BORROWER

Section 3.1.    Increased Costs...............................................12
Section 3.2.    Capital Adequacy..............................................13
Section 3.3.    Payments Free of Deductions...................................13
Section 3.4.    Payments......................................................14
Section 3.5.    Computations..................................................14
Section 3.6.    Payment on Non-Business Days..................................14

Section 3.7.    Interest......................................................14
Section 3.8.    Replacement of Borrower.......................................16
Section 3.9.    Funding Loss Indemnification..................................16
Section 3.10.   Illegality....................................................17


<PAGE>


                                TABLE OF CONTENTS
                                  (Continued)

                                                                            PAGE
                                                                            ----

                                   ARTICLE IV.

                              CONDITIONS PRECEDENT

Section 4.1.    Conditions Precedent to Effectiveness of Section 2.1..........17
Section 4.2.    Conditions Precedent to Borrowing.............................19

                                   ARTICLE V.

                                    COVENANTS

Section 5.1.    Affirmative Covenants of the Borrower.........................19
Section 5.2.    Negative Covenants of the Borrower............................19

                                   ARTICLE VI.

                           LIQUIDITY EVENTS OF DEFAULT

Section 6.1.    Liquidity Events of Default...................................20

                                  ARTICLE VII.

                                  MISCELLANEOUS

Section 7.1.    Amendments, Etc...............................................20
Section 7.2.    Notices, Etc..................................................20
Section 7.3.    No Waiver; Remedies...........................................21
Section 7.4.    Further Assurances............................................21
Section 7.5.    Indemnification; Survival of Certain Provisions...............21
Section 7.6.    Liability of the Liquidity Provider...........................22
Section 7.7.    Costs, Expenses and Taxes.....................................22
Section 7.8.    Binding Effect; Participations................................23
Section 7.9.    Severability..................................................24
Section 7.10.   Governing Law.................................................25
Section 7.11.   Submission to Jurisdiction; Waiver of Jury Trial; Waiver of
                Immunity......................................................25
Section 7.12.   Execution in Counterparts.....................................26
Section 7.13.   Entirety......................................................26
Section 7.14.   Headings......................................................26
Section 7.15.   Liquidity Provider's Obligation To Make Advances..............26



<PAGE>
                                TABLE OF CONTENTS
                                  (Continued)



ANNEX I         Interest Advance Notice of Borrowing
ANNEX II        Non-Extension Advance Notice of Borrowing
ANNEX III       Downgrade Advance Notice of Borrowing
ANNEX IV        Final Advance Notice of Borrowing
ANNEX V         Notice of Termination
ANNEX VI        Notice of Replacement Subordination Agent

SCHEDULE I TO INTEREST  ADVANCE NOTICE OF BORROWING
SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING
SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING
SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING

</TABLE>





<PAGE>


                           REVOLVING CREDIT AGREEMENT


          This  REVOLVING  CREDIT  AGREEMENT  dated as of  September  25,  1997,
between WILMINGTON TRUST COMPANY, a Delaware corporation,  not in its individual
capacity but solely as  Subordination  Agent under the  Intercreditor  Agreement
(each as defined below),  as agent and trustee for the Class A Trust (as defined
below) (the "BORROWER"), and ABN AMRO BANK N.V., a bank organized under the laws
of The  Netherlands,  acting  through  its  Chicago  Branch  ("ABN  AMRO" or the
"LIQUIDITY PROVIDER").


                              W I T N E S S E T H:
                              - - - - - - - - - - 

          WHEREAS,  pursuant to the Class A Trust  Agreement  (such term and all
other  capitalized terms used in these recitals having the meanings set forth or
referred  to in  Section  1.1),  the  Class  A  Trust  is  issuing  the  Class A
Certificates; and

          WHEREAS,  the  Borrower,  in order to support the timely  payment of a
portion of the interest on the Class A  Certificates  in  accordance  with their
terms,  has  requested  the  Liquidity  Provider  to enter into this  Agreement,
providing in part for the Borrower to request in  specified  circumstances  that
Advances be made hereunder.

          NOW, THEREFORE,  in consideration of the premises,  the parties hereto
agree as follows:

                                   ARTICLE I.

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

          Section 1.1. CERTAIN DEFINED TERMS.  (a) DEFINITIONS.  As used in this
Agreement  and unless  otherwise  expressly  indicated,  or unless  the  context
clearly  requires  otherwise,  the  following  capitalized  terms shall have the
following respective meanings for all purposes of this Agreement:

          "ADDITIONAL  COST" has the  meaning  assigned  to such term in Section
     3.1.

          "ADVANCE"  means an  Interest  Advance,  a Final  Advance,  a Provider
     Advance,  an Applied Provider Advance or an Unpaid Advance, as the case may
     be.

          "APPLICABLE  LIQUIDITY RATE" has the meaning  assigned to such term in
     Section 3.7(g).

          "APPLICABLE  MARGIN"  means (w) with respect to any Unpaid  Advance or
     Applied  Provider  Advance,  2.00% or (x)  with  respect  to any  Unapplied
     Provider Advance, .40%.

          "APPLIED  DOWNGRADE  ADVANCE" has the meaning assigned to such term in
     Section 2.6(a).


<PAGE>


          "APPLIED  NON-EXTENSION ADVANCE" has the meaning assigned to such term
     in Section 2.6(a).

          "APPLIED  PROVIDER  ADVANCE" has the meaning  assigned to such term in
     Section 2.6(a).

          "BASE RATE" means a fluctuating interest rate per annum in effect from
     time to time,  which rate per annum  shall at all times be equal to (a) the
     weighted average of the rates on overnight Federal funds  transactions with
     members of the Federal Reserve System arranged by Federal funds brokers, as
     published for such day (or, if such day is not a Business Day, for the next
     preceding Business Day) by the Federal Reserve Bank of New York, or if such
     rate is not so published for any day that is a Business Day, the average of
     the quotations for such day for such transactions received by the Liquidity
     Provider from three Federal funds brokers of recognized  standing  selected
     by it, plus (b) one-quarter of one percent (1/4 of 1%).

          "BASE RATE  ADVANCE"  means an Advance  that bears  interest at a rate
     based upon the Base Rate.

          "BORROWER"  has the  meaning  assigned  to such term in the recital of
     parties to this Agreement.

          "BORROWING"  means the making of Advances  requested  by delivery of a
     Notice of Borrowing.

          "BUSINESS  DAY" means any day other than a Saturday or Sunday or a day
     on which  commercial  banks are required or authorized to close in Houston,
     Texas,  New York,  New York,  Chicago,  Illinois or, so long as any Class A
     Certificate  is  outstanding,  the city and  state  in  which  the  Class A
     Trustee,  the Borrower or any Loan Trustee  maintains its  Corporate  Trust
     Office or receives or disburses funds, and, if the applicable  Business Day
     relates to any Advance or other amount bearing  interest based on the LIBOR
     Rate, on which dealings are carried on in the London interbank market.

          "DOWNGRADE ADVANCE" means an Advance made pursuant to Section 2.2(c).

          "EFFECTIVE  DATE"  has the  meaning  specified  in  Section  4.1.  The
     delivery of the  certificate  of the  Liquidity  Provider  contemplated  by
     Section  4.1(e) shall be conclusive  evidence  that the Effective  Date has
     occurred.

          "EXCLUDED  TAXES" means (i) taxes imposed on the overall net income of
     the Liquidity  Provider or of its Lending Office by the jurisdiction  where
     such  Liquidity  Provider's  principal  office  or such  Lending  Office is
     located, and (ii) Excluded Withholding Taxes.

          "EXCLUDED  WITHHOLDING  TAXES" means (i) withholding  Taxes imposed by
     the United States except to the extent that such United States  withholding


<PAGE>


     Taxes are  imposed  as a result of any change in  applicable  law after the
     date hereof  (excluding  from change in  applicable  law for this purpose a
     change  in an  applicable  treaty  or other  change  in law  affecting  the
     applicability  of a  treaty),  or in  the  case  of a  successor  Liquidity
     Provider  (including a transferee of an Advance) or Lending  Office,  after
     the date on which such successor Liquidity Provider obtains its interest or
     on which the Lending  Office is  changed,  and (ii) any  withholding  Taxes
     imposed by the United  States which are imposed or increased as a result of
     the Liquidity  Provider  failing to deliver to the Borrower any certificate
     or document  (which  certificate  or document in the good faith judgment of
     the  Liquidity  Provider  it is  legally  entitled  to  provide)  which  is
     reasonably  requested by the Borrower to establish that payments under this
     Agreement  are exempt from (or entitled to a reduced  rate of)  withholding
     Tax.

          "EXPENSES"  means  liabilities,   obligations,  damages,  settlements,
     penalties,  claims,  actions,  suits,  costs,  expenses,  and disbursements
     (including, without limitation,  reasonable fees and disbursements of legal
     counsel  and costs of  investigation),  provided  that  Expenses  shall not
     include any Taxes.

          "EXPIRY  DATE" means  September  24, 1998,  initially,  or any date to
     which the Expiry Date is extended pursuant to Section 2.10.

          "FINAL ADVANCE" means an Advance made pursuant to Section 2.2(d).

          "INTERCREDITOR  AGREEMENT" means the Intercreditor Agreement dated the
     date hereof,  among the  Trustees,  the Liquidity  Provider,  the liquidity
     provider under each Liquidity  Facility (other than this Agreement) and the
     Subordination Agent, as the same may be amended,  supplemented or otherwise
     modified from time to time in accordance with its terms.

          "INTEREST ADVANCE" means an Advance made pursuant to Section 2.2(a).

          "INTEREST  PERIOD" means,  with respect to any LIBOR Advance,  each of
     the following periods:

               (i) the period  beginning  on the third  Business  Day  following
     either (x) the Liquidity  Provider's receipt of the Notice of Borrowing for
     such  LIBOR  Advance or (y) the  withdrawal  of funds from the Class A Cash
     Collateral  Account  for the  purpose  of  paying  interest  on the Class A
     Certificates  as contemplated by Section 2.6(a) hereof and, in either case,
     ending on the next Regular Distribution Date; and

               (ii) each  subsequent  period  commencing  on the last day of the
     immediately  preceding  Interest  Period  and  ending  on the next  Regular
     Distribution Date;

     PROVIDED,  HOWEVER,  that if (x) the Final Advance shall have been made, or
     (y) other  outstanding  Advances  shall have been  converted into the Final
     Advance, then the Interest Periods shall be successive periods of one month
     beginning on the third  Business Day  following  the  Liquidity  Provider's
     receipt of the Notice of Borrowing  for such Final  Advance (in the case of


<PAGE>


     clause  (x)  above)  or  the  Regular   Distribution  Date  following  such
     conversion (in the case of clause (y) above).

          "LENDING  OFFICE" means the lending  office of the Liquidity  Provider
     presently located at Chicago, Illinois, or such other lending office as the
     Liquidity  Provider  from time to time  shall  notify the  Borrower  as its
     lending office  hereunder;  provided that the Liquidity  Provider shall not
     change its Lending  Office to a Lending Office outside the United States of
     America except in accordance with Section 3.1, 3.2 or 3.3 hereof.

          "LIBOR ADVANCE" means an Advance bearing interest at a rate based upon
     the LIBOR Rate.

          "LIBOR RATE" means,  with respect to any Interest Period,  the average
     (rounded upward, if necessary,  to the next higher 1/16 of 1%) of the rates
     per annum at which  deposits  in dollars  are offered to major banks in the
     London  interbank  market at  approximately  11:00 A.M.  (London  time) two
     Business  Days  before the first day of such  Interest  Period in an amount
     approximately  equal to the  principal  amount of the Advance to which such
     Interest  Period is to apply and for a period  of time  comparable  to such
     Interest Period.

          "LIQUIDITY  EVENT OF DEFAULT"  means the  occurrence of either (a) the
     Acceleration of all of the Equipment Notes or (b) a Continental  Bankruptcy
     Event.

          "LIQUIDITY  INDEMNITEE"  means (i) the  Liquidity  Provider,  (ii) the
     directors,  officers,  employees and agents of the Liquidity Provider,  and
     (iii) the  successors  and  permitted  assigns of the persons  described in
     clauses (i) and (ii), inclusive.

          "LIQUIDITY  PROVIDER"  has the  meaning  assigned  to such term in the
     recital of parties to this Agreement.

          "MAXIMUM  AVAILABLE  COMMITMENT"  shall  mean,  subject to the proviso
     contained  in  the  third  sentence  of  Section  2.2(a),  at any  time  of
     determination,  (a) the  Maximum  Commitment  at  such  time  less  (b) the
     aggregate  amount  of each  Interest  Advance  outstanding  at  such  time;
     provided that following a Provider Advance or a Final Advance,  the Maximum
     Available Commitment shall be zero.

          "MAXIMUM  COMMITMENT" means, for any day, the lesser of (x) $5,846,856
     and (y) the Required Amount on such day.

          "NON-EXTENSION  ADVANCE"  means an Advance  made  pursuant  to Section
     2.2(b).

          "NOTICE OF BORROWING" has the meaning specified in Section 2.2(e).

          "NOTICE OF REPLACEMENT  SUBORDINATION AGENT" has the meaning specified
     in Section 3.8.


<PAGE>


          "PERFORMING NOTE DEFICIENCY"  means any time that less than 65% of the
     then  aggregate  outstanding  principal  amount of all Equipment  Notes are
     Performing Equipment Notes.

          "PROSPECTUS" means the Prospectus dated July 23, 1997, as modified and
     supplemented  by  the  Prospectus  Supplement  dated  September  12,  1997,
     relating to the Certificates; and as such Prospectus may be further amended
     or supplemented.

          "PROVIDER  ADVANCE"  means  a  Downgrade  Advance  or a  Non-Extension
     Advance.

          "REGULATORY  CHANGE" has the meaning  assigned to such term in Section
     3.1.

          "REPLENISHMENT  AMOUNT"  has the  meaning  assigned  to  such  term in
     Section 2.6(b).

          "REQUIRED  AMOUNT" means, for any day, the sum of the aggregate amount
     of interest,  calculated at the rate per annum equal to the Stated Interest
     Rate for the Class A  Certificates,  that  would be  payable on the Class A
     Certificates on each of the six successive  quarterly Regular  Distribution
     Dates  immediately  following  such  day  or,  if  such  day  is a  Regular
     Distribution  Date, on such day and the succeeding  five quarterly  Regular
     Distribution  Dates,  in each  case  calculated  on the  basis  of the Pool
     Balance  of the  Class A  Certificates  on such day and  without  regard to
     expected future payments of principal on the Class A Certificates.

          "ROLLS ROYCE" means Rolls-Royce plc, a corporation organized under the
     laws of England.

          "TAX  LETTER"  means the  letter  dated the date  hereof  between  the
     Liquidity Provider and Rolls Royce pertaining to this Agreement.

          "TERMINATION  DATE" means the earliest to occur of the following:  (i)
     the  Expiry  Date;  (ii) the date on which  the  Borrower  delivers  to the
     Liquidity  Provider a certificate,  signed by a Responsible  Officer of the
     Borrower, certifying that all of the Class A Certificates have been paid in
     full (or provision  has been made for such payment in  accordance  with the
     Intercreditor  Agreement  and the Trust  Agreements)  or are  otherwise  no
     longer entitled to the benefits of this Agreement;  (iii) the date on which
     the Borrower delivers to the Liquidity Provider a certificate,  signed by a
     Responsible  Officer  of  the  Borrower,   certifying  that  a  Replacement
     Liquidity Facility has been substituted for this Agreement in full pursuant
     to Section 3.6(e) of the Intercreditor  Agreement;  (iv) the fifth Business
     Day following the receipt by the Borrower of a Termination  Notice from the
     Liquidity  Provider  pursuant to Section  6.1  hereof;  and (v) the date on
     which no Advance is or may (including by reason of  reinstatement as herein
     provided) become available for a Borrowing hereunder.

          "TERMINATION NOTICE" means the Notice of Termination  substantially in
     the form of Annex V to this Agreement.


<PAGE>


          "TRANSFEREE" has the meaning assigned to such term in Section 7.8(b).

          "UNAPPLIED  DOWNGRADE  ADVANCE" means any Downgrade Advance other than
     an Applied Downgrade Advance.

          "UNAPPLIED  PROVIDER ADVANCE" means any Provider Advance other than an
     Applied Provider Advance.

          "UNPAID ADVANCE" has the meaning assigned to such term in Section 2.5.

          (b) TERMS DEFINED IN THE INTERCREDITOR  AGREEMENT. For all purposes of
this Agreement,  the following terms shall have the respective meanings assigned
to such terms in the Intercreditor Agreement:

          "ACCELERATION",  "CERTIFICATES",  "CLASS A CASH  COLLATERAL  ACCOUNT",
          "CLASS A CERTIFICATES", "CLASS A CERTIFICATEHOLDERS", "CLASS A TRUST",
          "CLASS A TRUST AGREEMENT", "CLASS A TRUSTEE", "CLASS B CASH COLLATERAL
          ACCOUNT", "CLASS B CERTIFICATES", "CLASS B CERTIFICATEHOLDERS", "CLASS
          B TRUST", "CLASS B TRUST AGREEMENT",  "CLASS B TRUSTEE", "CLASS C CASH
          COLLATERAL    ACCOUNT",    "CLASS    C    CERTIFICATES",    "CLASS   C
          CERTIFICATEHOLDERS",  "CLASS  C  TRUST",  "CLASS  C TRUST  AGREEMENT",
          "CLASS  C  TRUSTEE",  "CLOSING  DATE",   "CONTINENTAL",   "CONTINENTAL
          BANKRUPTCY  EVENT",  "CONTROLLING  PARTY",  "CORPORATE  TRUST OFFICE",
          "DELIVERY  PERIOD  EXPIRY  DATE",   "DISTRIBUTION  DATE",  "DOWNGRADED
          FACILITY",  "EQUIPMENT NOTES",  "FEE LETTER",  "FINANCING  AGREEMENT",
          "INDENTURE",   "INVESTMENT  EARNINGS",   "LIQUIDITY  FACILITY",  "LOAN
          TRUSTEE", "MOODY'S",  "NON-EXTENDED FACILITY", "OPERATIVE AGREEMENTS",
          "PERFORMING  EQUIPMENT  NOTE",  "PERSON",  "POOL  BALANCE",  "PURCHASE
          AGREEMENT", "RATING AGENCY", "REGULAR DISTRIBUTION DATE", "REPLACEMENT
          LIQUIDITY  FACILITY",   "RESPONSIBLE  OFFICER",  "SCHEDULED  PAYMENT",
          "SPECIAL  PAYMENT",  "STANDARD  &  POOR'S",  "STATED  INTEREST  RATE",
          "SUBORDINATION AGENT", "TAXES", "THRESHOLD RATING", "TRANSFER", "TRUST
          AGREEMENTS", "TRUSTEE",  "UNDERWRITERS",  "UNDERWRITING AGREEMENT" AND
          "WRITTEN NOTICE".

                                   ARTICLE II.

                       AMOUNT AND TERMS OF THE COMMITMENT
                       ----------------------------------

          Section 2.1. THE ADVANCES.  The Liquidity  Provider hereby irrevocably
agrees,  on the terms and conditions  hereinafter set forth, to make Advances to
the  Borrower  from time to time on any  Business Day during the period from the
Effective  Date until 12:00 Noon (New York City time) on the Expiry Date (unless
the  obligations  of the  Liquidity  Provider  shall be  earlier  terminated  in
accordance with the terms of Section 2.4(b)) in an aggregate  amount at any time
outstanding not to exceed the Maximum Commitment.



<PAGE>


          Section 2.2. MAKING THE ADVANCES.

                      2.2.1.  Interest  Advances  shall  be  made in one or more
          Borrowings  by  delivery  to the  Liquidity  Provider  of one or  more
          written and completed  Notices of Borrowing in substantially  the form
          of Annex I attached  hereto,  signed by a  Responsible  Officer of the
          Borrower,  in an amount not exceeding the Maximum Available Commitment
          at such time and shall be used solely for the payment  when due of the
          interest  on the Class A  Certificates  at the  Stated  Interest  Rate
          therefor  in  accordance  with  Section  3.6(a)  of the  Intercreditor
          Agreement.  Each Interest  Advance made hereunder shall  automatically
          reduce the Maximum Available Commitment and the amount available to be
          borrowed  hereunder  by  subsequent  Advances  by the  amount  of such
          Interest  Advance  (subject to  reinstatement  as provided in the next
          sentence).  Upon  repayment to the  Liquidity  Provider in full of the
          amount of any Interest  Advance made pursuant to this Section  2.2(a),
          together  with  accrued  interest  thereon (as provided  herein),  the
          Maximum Available Commitment shall be reinstated by the amount of such
          repaid  Interest  Advance,  but not to exceed the Maximum  Commitment;
          PROVIDED,  HOWEVER, that the Maximum Available Commitment shall not be
          so  reinstated  at any time if (i) a Liquidity  Event of Default shall
          have  occurred and be continuing  and (ii) there is a Performing  Note
          Deficiency.

                      2.2.2. A  Non-Extension  Advance shall be made in a single
          Borrowing if this Agreement is not extended in accordance with Section
          3.6(d) of the Intercreditor  Agreement (unless a Replacement Liquidity
          Facility  to  replace  this  Agreement   shall  have  been  previously
          delivered to the Borrower in accordance  with said Section  3.6(d)) by
          delivery to the Liquidity  Provider of a written and completed  Notice
          of Borrowing in  substantially  the form of Annex II attached  hereto,
          signed by a Responsible Officer of the Borrower, in an amount equal to
          the Maximum  Available  Commitment at such time,  and shall be used to
          fund the  Class A Cash  Collateral  Account  in  accordance  with said
          Section 3.6(d).

                      2.2.3.  A  Downgrade  Advance  shall  be made in a  single
          Borrowing  upon a downgrading of the Liquidity  Provider's  short-term
          unsecured  debt  rating  issued  by  either  Rating  Agency  below the
          Threshold   Rating  (as  provided   for  in  Section   3.6(c)  of  the
          Intercreditor  Agreement) unless a Replacement  Liquidity  Facility to
          replace this  Agreement  shall have been  previously  delivered to the
          Borrower in accordance  with said Section  3.6(c),  by delivery to the
          Liquidity  Provider of a written and completed  Notice of Borrowing in
          substantially  the form of Annex  III  attached  hereto,  signed  by a
          Responsible Officer of the Borrower, in an amount equal to the Maximum
          Available Commitment at such time, and shall be used to fund the Class
          A Cash Collateral Account in accordance with said Section 3.6(c).

                      2.2.4. A Final Advance shall be made in a single Borrowing
          upon the  receipt by the  Borrower  of a  Termination  Notice from the


<PAGE>

          Liquidity  Provider  pursuant to Section 6.1 hereof by delivery to the
          Liquidity  Provider of a written and completed  Notice of Borrowing in
          substantially  the form of  Annex  IV  attached  hereto,  signed  by a
          Responsible Officer of the Borrower, in an amount equal to the Maximum
          Available Commitment at such time, and shall be used to fund the Class
          A Cash  Collateral  Account (in accordance  with Section 3.6(i) of the
          Intercreditor Agreement).

                      2.2.5.  Each Borrowing  shall be made on notice in writing
          (a  "NOTICE OF  BORROWING")  in  substantially  the form  required  by
          Section 2.2(a), 2.2(b), 2.2(c) or 2.2(d), as the case may be, given by
          the Borrower to the  Liquidity  Provider.  If a Notice of Borrowing is
          delivered  by the  Borrower in respect of any  Borrowing no later than
          12:00  Noon (New York City  time) on a  Business  Day,  the  Liquidity
          Provider  shall,  upon  satisfaction  of the conditions  precedent set
          forth in Section  4.2 with  respect to a requested  Borrowing,  before
          12:00  Noon  (New  York  City  time) on the  first  Business  Day next
          following  the day of receipt of such Notice of  Borrowing  or on such
          later  Business  Day  specified  in such  Notice  of  Borrowing,  make
          available   to  the   Borrower,   in   accordance   with  its  payment
          instructions,  in U.S.  dollars and immediately  available  funds, the
          amount of such Borrowing. If a Notice of Borrowing is delivered by the
          Borrower in respect of any  Borrowing  after 12:00 Noon (New York City
          time)  on  a  Business  Day,  the  Liquidity   Provider  shall,   upon
          satisfaction of the conditions precedent set forth in Section 4.2 with
          respect to a  requested  Borrowing,  before  12:00 Noon (New York City
          time) on the second  Business Day next following the day of receipt of
          such Notice of  Borrowing or on such later  Business Day  specified by
          the  Borrower  in such  Notice of  Borrowing,  make  available  to the
          Borrower, in accordance with its payment instructions, in U.S. dollars
          and in  immediately  available  funds,  the amount of such  Borrowing.
          Payments of proceeds of a Borrowing  shall be made by wire transfer of
          immediately  available  funds to the Borrower in accordance  with such
          wire transfer  instructions as the Borrower shall furnish from time to
          time to the  Liquidity  Provider  for such  purpose.  Each  Notice  of
          Borrowing shall be irrevocable and binding on the Borrower.

                      2.2.6. Upon the making of any Advance  requested  pursuant
          to a Notice of Borrowing,  in accordance  with the Borrower's  payment
          instructions,  the Liquidity Provider shall be fully discharged of its
          obligation hereunder with respect to such Notice of Borrowing, and the
          Liquidity  Provider  shall not  thereafter  be  obligated  to make any
          further  Advances  hereunder in respect of such Notice of Borrowing to
          the  Borrower  or to any other  Person.  Following  the  making of any
          Advance  pursuant  to  Section  2.2(b),  (c) or (d) hereof to fund the
          Class A Cash Collateral Account,  the Liquidity Provider shall have no
          interest  in or rights to the Class A Cash  Collateral  Account,  such
          Advance or any other amounts from time to time on deposit in the Class
          A Cash  Collateral  Account;  provided  that the  foregoing  shall not
          affect or impair the  obligations of the  Subordination  Agent to make
          the  distributions  contemplated  by  Section  3.6(e)  or  (f)  of the
          Intercreditor  Agreement.  By  paying  to  the  Borrower  proceeds  of


<PAGE>

          Advances  requested by the Borrower in accordance  with the provisions
          of this Agreement,  the Liquidity  Provider makes no representation as
          to, and assumes no responsibility  for, the correctness or sufficiency
          for any purpose of the amount of the Advances so made and requested.

          Section  2.3.  FEES.  The  Borrower  agrees  to pay  to the  Liquidity
Provider the fees set forth in the Fee Letter.

          Section 2.4. ADJUSTMENTS OR TERMINATION OF THE MAXIMUM COMMITMENT.

                      2.4.1. AUTOMATIC ADJUSTMENTS. Promptly following each date
          on which the Required  Amount is reduced as a result of a reduction in
          the Pool Balance of the Class A Certificates or otherwise,  clause (y)
          of the definition of Maximum Commitment shall automatically be reduced
          to an  amount  equal to the  Required  Amount  (as  calculated  by the
          Borrower).  The  Borrower  shall  give  notice  of any such  automatic
          reduction of the Maximum  Commitment to the Liquidity  Provider within
          two Business Days thereof.  The failure by the Borrower to furnish any
          such notice shall not affect such  automatic  reduction of the Maximum
          Commitment.

                      2.4.2 TERMINATION. Upon the making of any Provider Advance
          or Final Advance  hereunder or the occurrence of the Termination Date,
          the  obligation  of the  Liquidity  Provider to make further  Advances
          hereunder  shall  automatically  and  irrevocably  terminate,  and the
          Borrower  shall not be  entitled  to  request  any  further  Borrowing
          hereunder.

          Section 2.5.  REPAYMENTS  OF INTEREST  ADVANCES OR THE FINAL  ADVANCE.
Subject to Sections 2.6, 2.7 and 2.9 hereof, the Borrower hereby agrees, without
notice of an Advance or demand for repayment from the Liquidity  Provider (which
notice and demand are hereby waived by the Borrower),  to pay, or to cause to be
paid,  to the Liquidity  Provider on each date on which the  Liquidity  Provider
shall make an Interest Advance or the Final Advance,  an amount equal to (a) the
amount of such Advance (any such Advance, until repaid, is referred to herein as
an  "UNPAID  ADVANCE"),  plus (b)  interest  on the  amount of each such  Unpaid
Advance as provided in Section 3.7 hereof;  PROVIDED  that if (i) the  Liquidity
Provider  shall  make a Provider  Advance  at any time after  making one or more
Interest  Advances  which  shall not have been  repaid in  accordance  with this
Section 2.5 or (ii) this Liquidity  Facility shall become a Downgraded  Facility
or Non-Extended  Facility at any time when  unreimbursed  Interest Advances have
reduced the Maximum  Available  Commitment to zero, then such Interest  Advances
shall  cease to  constitute  Unpaid  Advances  and  shall be deemed to have been
changed into an Applied Downgrade Advance or an Applied  Non-Extension  Advance,
as the case may be,  for all  purposes  of this  Agreement  (including,  without
limitation,  for the  purpose  of  determining  when such  Interest  Advance  is
required to be repaid to the Liquidity  Provider in accordance  with Section 2.6
and for the purposes of Section 2.6(b)). The Borrower and the Liquidity Provider
agree that the repayment in full of each  Interest  Advance and Final Advance on


<PAGE>

the date such Advance is made is intended to be a  contemporaneous  exchange for
new value given to the Borrower by the Liquidity Provider.

          Section 2.6. REPAYMENTS OF PROVIDER ADVANCES.

                      2.6.1 Amounts advanced  hereunder in respect of a Provider
          Advance  shall be  deposited in the Class A Cash  Collateral  Account,
          invested and withdrawn from the Class A Cash Collateral Account as set
          forth in Sections 3.6(c), (d) and (f) of the Intercreditor  Agreement.
          The Borrower agrees to pay to the Liquidity Provider,  on each Regular
          Distribution Date,  commencing on the first Regular  Distribution Date
          after the  making of a Provider  Advance,  interest  on the  principal
          amount of any such  Provider  Advance  as  provided  in  Section  3.7;
          PROVIDED,  HOWEVER,  that  amounts in  respect  of a Provider  Advance
          withdrawn from the Class A Cash Collateral  Account for the purpose of
          paying interest on the Class A Certificates in accordance with Section
          3.6(f)  of  the  Intercreditor  Agreement  (the  amount  of  any  such
          withdrawal being (y) in the case of a Downgrade  Advance,  an "APPLIED
          DOWNGRADE ADVANCE" and (z) in the case of a Non-Extension  Advance, an
          "APPLIED   NON-EXTENSION   ADVANCE"  and,  together  with  an  Applied
          Downgrade  Advance,  an "APPLIED  PROVIDER  ADVANCE") shall thereafter
          (subject to Section  2.6(b)) be treated as an Interest  Advance  under
          this  Agreement for purposes of determining  the Applicable  Liquidity
          Rate for interest payable thereon; PROVIDED FURTHER, HOWEVER, that if,
          following the making of a Provider  Advance,  the  Liquidity  Provider
          delivers a Termination  Notice to the Borrower pursuant to Section 6.1
          hereof,  such Provider  Advance shall thereafter be treated as a Final
          Advance  under  this  Agreement  for  purposes  of   determining   the
          Applicable  Liquidity Rate for interest  payable  thereon.  Subject to
          Sections 2.7 and 2.9 hereof,  immediately  upon the  withdrawal of any
          amounts  from the Class A Cash  Collateral  Account  on  account  of a
          reduction in the  Required  Amount,  the  Borrower  shall repay to the
          Liquidity  Provider a portion of the Provider  Advances in a principal
          amount  equal to the amount of such  reduction,  plus  interest on the
          principal amount prepaid as provided in Section 3.7 hereof.

                      2.6.2.  At any time when an Applied  Provider  Advance (or
          any portion  thereof) is outstanding,  upon the deposit in the Class A
          Cash  Collateral  Account of any amount  pursuant to clause "THIRD" of
          Section  2.4(b) of the  Intercreditor  Agreement,  clause  "THIRD"  of
          Section  3.2 of the  Intercreditor  Agreement  or clause  "FOURTH"  of
          Section 3.3 of the  Intercreditor  Agreement  (any such amount being a
          "REPLENISHMENT  AMOUNT") for the purpose of replenishing or increasing
          the balance  thereof up to the Required  Amount at such time,  (i) the
          aggregate   outstanding  principal  amount  of  all  Applied  Provider
          Advances (and of Provider  Advances treated as an Interest Advance for
          purposes of  determining  the  Applicable  Liquidity Rate for interest
          payable thereon) shall be automatically  reduced by the amount of such
          Replenishment  Amount  and (ii) the  aggregate  outstanding  principal
          amount  of all  Unapplied  Provider  Advances  shall be  automatically
          increased by the amount of such Replenishment Amount.


<PAGE>

                      2.6.3.  Upon  the  provision  of a  Replacement  Liquidity
          Facility in replacement  of this Agreement in accordance  with Section
          3.6(e) of the Intercreditor Agreement, amounts remaining on deposit in
          the Class A Cash Collateral Account after giving effect to any Applied
          Provider Advance on the date of such  replacement  shall be reimbursed
          to the  Liquidity  Provider,  but only to the extent such  amounts are
          necessary to repay in full to the Liquidity Provider all amounts owing
          to it hereunder.

          Section   2.7.   PAYMENTS  TO  THE   LIQUIDITY   PROVIDER   UNDER  THE
INTERCREDITOR  AGREEMENT.  In order to provide for payment or  repayment  to the
Liquidity  Provider  of  any  amounts  hereunder,  the  Intercreditor  Agreement
provides  that amounts  available  and referred to in Articles II and III of the
Intercreditor  Agreement,  to  the  extent  payable  to the  Liquidity  Provider
pursuant  to  the  terms  of the  Intercreditor  Agreement  (including,  without
limitation, Section 3.6(f) of the Intercreditor Agreement), shall be paid to the
Liquidity Provider in accordance with the terms thereof.  Amounts so paid to the
Liquidity  Provider  shall be applied by the  Liquidity  Provider  to  Liquidity
Obligations then due and payable in accordance with the Intercreditor  Agreement
or, if not provided for in the Intercreditor  Agreement,  then in such manner as
the Liquidity Provider shall deem appropriate.

          Section 2.8. BOOK ENTRIES.  The Liquidity  Provider  shall maintain in
accordance  with its usual  practice  an  account  or  accounts  evidencing  the
indebtedness of the Borrower  resulting from Advances made from time to time and
the amounts of principal  and interest  payable  hereunder and paid from time to
time in respect thereof;  PROVIDED,  HOWEVER,  that the failure by the Liquidity
Provider to maintain such account or accounts  shall not affect the  obligations
of the Borrower in respect of Advances.

          Section 2.9.  PAYMENTS FROM  AVAILABLE  FUNDS ONLY. All payments to be
made by the Borrower  under this  Agreement  shall be made only from the amounts
that constitute  Scheduled Payments,  Special Payments or payments under Section
9.1 of the  Participation  Agreements  and only to the extent that the  Borrower
shall have  sufficient  income or proceeds  therefrom  to enable the Borrower to
make  payments in  accordance  with the terms hereof after giving  effect to the
priority of payments  provisions set forth in the Intercreditor  Agreement.  The
Liquidity Provider agrees that it will look solely to such amounts to the extent
available for distribution to it as provided in the Intercreditor  Agreement and
this  Agreement  and that  the  Borrower,  in its  individual  capacity,  is not
personally  liable  to it for  any  amounts  payable  or  liability  under  this
Agreement  except as expressly  provided in this  Agreement,  the  Intercreditor
Agreement or any Participation Agreement. Amounts on deposit in the Class A Cash
Collateral  Account  shall be available to the Borrower to make  payments  under
this Agreement only to the extent and for the purposes expressly contemplated in
Section 3.6(f) of the Intercreditor Agreement.

          Section 2.10. EXTENSION OF THE EXPIRY DATE;  NON-EXTENSION ADVANCE. No
earlier  than  the 60th  day and no  later  than the 40th day  prior to the then
effective  Expiry Date  (unless such Expiry Date is on or after the date that is
15 days  after  the  Final  Maturity  Date for the  Class A  Certificates),  the
Borrower shall request that the Liquidity  Provider extend the Expiry Date for a


<PAGE>

period of 364 days after the then effective  Expiry Date (unless the obligations
of the Liquidity  Provider are earlier  terminated in accordance  with the terms
hereof).  The Liquidity  Provider shall advise the Borrower,  no earlier than 40
days and no later than 25 days prior to the then effective Expiry Date, whether,
in its sole discretion, it agrees to so extend the Expiry Date. If the Liquidity
Provider advises the Borrower on or before the 25th day prior to the Expiry Date
then in effect  that such  Expiry  Date  shall not be so  extended,  or fails to
irrevocably  and  unconditionally  advise the Borrower on or before the 25th day
prior to the  Expiry  Date then in  effect  that such  Expiry  Date  shall be so
extended  (and,  in each case,  if the  Liquidity  Provider  shall not have been
replaced in accordance with Section 3.6(e) of the Intercreditor Agreement),  the
Borrower  shall be  entitled  on and after  such 25th day (but prior to the then
effective  Expiry Date) to request a  Non-Extension  Advance in accordance  with
Section 2.2(b) hereof and Section 3.6(d) of the Intercreditor Agreement.

                                  ARTICLE III.

                           OBLIGATIONS OF THE BORROWER
                           ---------------------------

          Section 3.1. INCREASED COSTS.  Subject to the Fee Letter, the Borrower
shall pay to the  Liquidity  Provider  from time to time such  amounts as may be
necessary to compensate the Liquidity  Provider for any increased costs incurred
by the Liquidity  Provider which are  attributable  to its making or maintaining
any  LIBOR  Advances  hereunder  or its  obligation  to make any  such  Advances
hereunder,  or any reduction in any amount receivable by the Liquidity  Provider
under  this  Agreement  or the  Intercreditor  Agreement  in respect of any such
Advances or such  obligation  (such increases in costs and reductions in amounts
receivable being herein called  "ADDITIONAL  COSTS"),  resulting from any change
after the date of this Agreement in U.S. federal,  state,  municipal, or foreign
laws or  regulations  (including  Regulation D), or the adoption or making after
the date of this Agreement of any interpretations,  directives,  or requirements
applying to a class of banks  including  the Liquidity  Provider  under any U.S.
federal,  state,  municipal,  or any foreign laws or regulations (whether or not
having  the  force of law) by any  court,  central  bank or  monetary  authority
charged  with  the  interpretation  or  administration  thereof  (a  "REGULATORY
CHANGE"), which: (1) changes the basis of taxation of any amounts payable to the
Liquidity  Provider under this Agreement in respect of any such Advances  (other
than Excluded Taxes);  or (2) imposes or modifies any reserve,  special deposit,
compulsory loan or similar requirements  relating to any extensions of credit or
other  assets of, or any  deposits  with  other  liabilities  of, the  Liquidity
Provider  (including  any  such  Advances  or any  deposits  referred  to in the
definition of LIBOR Rate or related definitions).  The Liquidity Provider agrees
to use  reasonable  efforts  (consistent  with  applicable  legal and regulatory
restrictions)  to change the  jurisdiction  of its Lending Office if making such
change  would  avoid the need for,  or reduce the amount of, any amount  payable
under  this  Section  3.1 that may  thereafter  accrue  and  would  not,  in the
reasonable judgment of the Liquidity Provider,  be otherwise  disadvantageous to
the Liquidity Provider.

          The Liquidity Provider will notify the Borrower of any event occurring
after the date of this  Agreement  that will entitle the  Liquidity  Provider to
compensation  pursuant to this Section 3.1 as promptly as  practicable  after it


<PAGE>

obtains  knowledge  thereof and determines to request such  compensation,  which
notice shall describe in reasonable  detail the  calculation of the amounts owed
under this Section.  Determinations  by the  Liquidity  Provider for purposes of
this Section 3.1 of the effect of any  Regulatory  Change on its costs of making
or maintaining  Advances or on amounts  receivable by it in respect of Advances,
and of the additional  amounts required to compensate the Liquidity  Provider in
respect of any  Additional  Costs,  shall be prima facie  evidence of the amount
owed under this Section.

          Section 3.2. CAPITAL  ADEQUACY.  Subject to the Fee Letter, if (1) the
adoption,  after the date hereof,  of any applicable  governmental  law, rule or
regulation regarding capital adequacy, (2) any change, after the date hereof, in
the  interpretation or administration of any such law, rule or regulation by any
central bank or other governmental  authority charged with the interpretation or
administration  thereof  or (3)  compliance  by the  Liquidity  Provider  or any
corporation  controlling the Liquidity Provider with any applicable guideline or
request of general  applicability,  issued after the date hereof, by any central
bank or other  governmental  authority  (whether or not having the force of law)
that  constitutes a change of the nature described in clause (2), has the effect
of requiring an increase in the amount of capital  required to be  maintained by
the Liquidity  Provider or any corporation  controlling the Liquidity  Provider,
and such increase is based upon the Liquidity Provider's  obligations  hereunder
and other similar obligations,  the Borrower shall pay to the Liquidity Provider
from  time to time  such  additional  amount  or  amounts  as are  necessary  to
compensate the Liquidity  Provider for such portion of such increase as shall be
reasonably  allocable to the Liquidity  Provider's  obligations  to the Borrower
hereunder.  The Liquidity Provider agrees to use reasonable efforts  (consistent
with applicable legal and regulatory restrictions) to change the jurisdiction of
its Lending Office if making such change would avoid the need for, or reduce the
amount of, any amount payable under this Section that may thereafter  accrue and
would not, in the reasonable  judgment of the Liquidity  Provider,  be otherwise
materially disadvantageous to the Liquidity Provider.

          The Liquidity Provider will notify the Borrower of any event occurring
after the date of this  Agreement  that will entitle the  Liquidity  Provider to
compensation  pursuant to this Section 3.2 as promptly as  practicable  after it
obtains  knowledge  thereof and determines to request such  compensation,  which
notice shall describe in reasonable  detail the  calculation of the amounts owed
under this Section.  Determinations  by the  Liquidity  Provider for purposes of
this Section 3.2 of the effect of any increase in the amount of capital required
to be  maintained  by the  bank and of the  amount  allocable  to the  Liquidity
Provider's  obligations to the Borrower  hereunder shall be prima facie evidence
of the amounts owed under this Section.

          Section 3.3.  PAYMENTS  FREE OF  DEDUCTIONS.  All payments made by the
Borrower  under  this  Agreement  shall be made free and clear of,  and  without
reduction  for or on account  of, any  present or future  stamp or other  taxes,
levies, imposts, duties, charges, fees, deductions,  withholdings,  restrictions
or  conditions  of any  nature  whatsoever  now or  hereafter  imposed,  levied,
collected,  withheld or assessed,  excluding  Excluded Taxes (such  non-excluded
taxes  being  referred to herein,  collectively,  as  "Non-Excluded  Taxes" and,
individually,  as a "Non-Excluded  Tax"). If any Non-Excluded Taxes are required
to be withheld  from any amounts  payable to the Liquidity  Provider  under this
Agreement,  the amounts so payable to the Liquidity  Provider shall be increased
to the extent necessary to yield to the Liquidity Provider (after payment of all


<PAGE>

Non-Excluded  Taxes)  interest  or any other  such  amounts  payable  under this
Agreement  at the  rates or in the  amounts  specified  in this  Agreement.  The
Liquidity  Provider  agrees  to use  reasonable  efforts  (consistent  with  its
internal   policy  and  legal  and  regulatory   restrictions)   to  change  the
jurisdiction  of its Lending  Office if making such change  would avoid the need
for, or reduce the amount of, any such  additional  amounts that may  thereafter
accrue and would not, in the reasonable judgment of the Liquidity  Provider,  be
otherwise  disadvantageous to the Liquidity Provider. From time to time upon the
reasonable request of the Borrower,  the Liquidity Provider agrees to provide to
the  Borrower two  original  Internal  Revenue  Service  Forms 1001 or 4224,  as
appropriate,  or any successor or other form prescribed by the Internal  Revenue
Service,  certifying that the Liquidity Provider is exempt from or entitled to a
reduced  rate of United  States  withholding  tax on  payments  pursuant to this
Agreement.

          Section 3.4.  PAYMENTS.  The  Borrower  shall make or cause to be made
each payment to the Liquidity  Provider  under this Agreement so as to cause the
same to be received by the Liquidity Provider not later than 1:00 P.M. (New York
City time) on the day when due.  The  Borrower  shall make all such  payments in
lawful  money of the United  States of  America,  to the  Liquidity  Provider in
immediately  available  funds, by wire transfer to ABN AMRO Bank N.V., New York,
NY, ABA # 026009580, Account Name: ABN AMRO Bank, N.V. - Chicago Branch, Account
#  650-001-1789-41,  Reference:  Continental  Airlines,  Inc. Pass Through Trust
1997-3A .

          Section 3.5.  COMPUTATIONS.  All computations of interest based on the
Base Rate  shall be made on the basis of a year of 365 or 366 days,  as the case
may be, and all  computations  of interest based on the LIBOR Rate shall be made
on the basis of a year of 360 days,  in each case for the actual  number of days
(including the first day but excluding the last day) occurring in the period for
which such interest is payable.

          Section 3.6. PAYMENT ON NON-BUSINESS DAYS.  Whenever any payment to be
made  hereunder  shall be stated to be due on a day other than a  Business  Day,
such payment shall be made on the next succeeding Business Day and no additional
interest shall be due as a result (and if so made,  shall be deemed to have been
made when  due).  If any  payment in  respect  of  interest  on an Advance is so
deferred to the next succeeding  Business Day, such deferral shall not delay the
commencement  of the next Interest  Period for such Advance or reduce the number
of days for which  interest will be payable on such Advance on the next interest
payment date for such Advance.

          Section 3.7. INTEREST.

                      3.7.1.  Subject to Section 2.9, the Borrower shall pay, or
          shall  cause  to be paid,  without  duplication,  interest  on (i) the
          unpaid principal amount of each Advance from and including the date of
          such Advance (or, in the case of an Applied Provider Advance, from and
          including the date on which the amount  thereof was withdrawn from the
          Class  A Cash  Collateral  Account  to pay  interest  on the  Class  A
          Certificates) to but excluding the date such principal amount shall be
          paid in full (or, in the case of an Applied Provider Advance, the date
         

<PAGE>

          on which the Class A Cash Collateral  Account is fully  replenished in
          respect  of such  Advance)  and (ii) any other  amount  due  hereunder
          (whether  fees,  commissions,  expenses  or other  amounts  or, to the
          extent  permitted by law,  installments of interest on Advances or any
          such  other  amount)  which is not paid  when due  (whether  at stated
          maturity,  by  acceleration  or otherwise)  from and including the due
          date thereof to but excluding the date such amount is paid in full, in
          each such case, at a fluctuating  interest rate per annum for each day
          equal to the  Applicable  Liquidity  Rate (as defined  below) for such
          Advance  or such  other  amount as in effect  for such day,  but in no
          event at a rate per annum  greater than the maximum rate  permitted by
          applicable law; PROVIDED,  HOWEVER, that, if at any time the otherwise
          applicable interest rate as set forth in this Section 3.7 shall exceed
          the maximum rate  permitted by  applicable  law,  then any  subsequent
          reduction in such  interest  rate will not reduce the rate of interest
          payable  pursuant to this Section 3.7 below the maximum rate permitted
          by applicable  law until the total amount of interest  accrued  equals
          the  amount of  interest  that would  have  accrued if such  otherwise
          applicable  interest  rate as set forth in this Section 3.7 had at all
          times been in effect.

                      3.7.2.  Except as  provided  in  clause  (e)  below,  each
          Advance  will be  either a Base Rate  Advance  or a LIBOR  Advance  as
          provided in this Section. Each Advance will be a Base Rate Advance for
          the period from the date of its borrowing to (but excluding) the third
          Business Day following the Liquidity  Provider's receipt of the Notice
          of Borrowing  for such  Advance.  Thereafter,  such Advance shall be a
          LIBOR  Advance;  provided  that the Borrower (at the  direction of the
          Controlling  Party,  so  long  as the  Liquidity  Provider  is not the
          Controlling  Party) may (x) convert the Final Advance into a Base Rate
          Advance  on the last day of an  Interest  Period  for such  Advance by
          giving the Liquidity  Provider no less than four Business  Days' prior
          written  notice of such  election or (y) elect to  maintain  the Final
          Advance as Base Rate Advance by not  requesting  a  conversion  of the
          Final Advance to a LIBOR  Advance  under Clause (5) of the  applicable
          Notice of Borrowing.

                      3.7.3.  Each LIBOR Advance shall bear interest during each
          Interest  Period at a rate per annum  equal to the LIBOR Rate for such
          Interest  Period plus the  Applicable  Margin for such LIBOR  Advance,
          payable in arrears on the last day of such Interest Period and, in the
          event of the payment of principal of such LIBOR Advance on a day other
          than such  last day,  on the date of such  payment  (to the  extent of
          interest accrued on the amount of principal repaid).

                      3.7.4.  Each Base Rate  Advance  shall bear  interest at a
          rate per annum equal to the Base Rate plus the  Applicable  Margin for
          such  Base  Rate   Advance,   payable  in  arrears  on  each   Regular
          Distribution  Date and,  in the event of the payment of  principal  of
          such Base Rate  Advance  on a day  other  than a Regular  Distribution


<PAGE>

          Date,  on the date of such payment (to the extent of interest  accrued
          on the amount of principal repaid).

                      3.7.5.  Each  Unapplied  Provider  Advance  (i) during the
          period  from and  including  the date of the making of such  Unapplied
          Provider  Advance through but excluding the date of repayment  thereof
          or of  conversion  thereof  into a Final  Advance or Applied  Provider
          Advance  (and for any  additional  periods of time  during  which such
          Advance no longer  constitutes an Applied  Provider  Advance but again
          constitutes an Unapplied  Provider Advance pursuant to Sections 2.6(a)
          and (b)  hereof),  shall  bear  interest  in an  amount  equal  to the
          Investment  Earnings  on  amounts  on  deposit  in  the  Class  A Cash
          Collateral  Account for such period plus the Applicable  Margin on the
          amount of such  Unapplied  Provider  Advance  from time to time during
          such period,  payable in arrears on each Regular Distribution Date and
          (ii) after conversion thereof into a Final Advance or Applied Provider
          Advance  (but only for such period of time during  which such  Advance
          constitutes an Applied  Provider  Advance  pursuant to Sections 2.6(a)
          and (b)  hereof),  as the case may be,  shall be a LIBOR  Advance  and
          shall bear interest in accordance with clause (c) above.

                      3.7.6.  Each amount not paid when due  hereunder  (whether
          fees,  commissions,  expenses  or  other  amounts  or,  to the  extent
          permitted by applicable law,  installments of interest on Advances but
          excluding  Advances)  shall bear interest at a rate per annum equal to
          the Base Rate plus 2.00% until paid.

                      3.7.7. Each change in the Base Rate shall become effective
          immediately.  The rates of interest specified in this Section 3.7 with
          respect to any  Advance or other  amount  shall be  referred to as the
          "APPLICABLE LIQUIDITY RATE".

          Section 3.8. REPLACEMENT OF BORROWER. From time to time and subject to
the  successor  Borrower's  meeting the  eligibility  requirements  set forth in
Section 6.9 of the Intercreditor Agreement applicable to the Subordination Agent
upon the effective date and time specified in a written and completed  Notice of
Replacement  Subordination  Agent in substantially the form of Annex VI attached
hereto  (a  "NOTICE  OF  REPLACEMENT  SUBORDINATION  AGENT")  delivered  to  the
Liquidity  Provider by the then  Borrower,  the  successor  Borrower  designated
therein shall be substituted for as the Borrower for all purposes hereunder.

          Section 3.9. FUNDING LOSS  INDEMNIFICATION.  The Borrower shall pay to
the Liquidity Provider,  upon the request of the Liquidity Provider, such amount
or amounts as shall be sufficient  (in the  reasonable  opinion of the Liquidity
Provider) to compensate it for any loss,  cost, or expense incurred by reason of
the  liquidation  or  redeployment  of deposits  or other funds  acquired by the
Liquidity  Provider to fund or maintain any LIBOR Advance (but excluding loss of
anticipated profits) incurred as a result of:

          (a) Any repayment of a LIBOR Advance on a date other than the last day
of the Interest Period for such Advance; or


<PAGE>

          (b) Any failure by the Borrower to borrow a LIBOR  Advance on the date
for borrowing specified in the relevant notice under Section 2.2.

          Section 3.10. ILLEGALITY.  Notwithstanding any other provision in this
Agreement,  if any change in any  applicable  law,  rule or  regulation,  or any
change in the  interpretation  or  administration  thereof  by any  governmental
authority,  central bank or comparable agency charged with the interpretation or
administration  thereof, or compliance by the Liquidity Provider (or its Lending
Office) with any request or  directive  (whether or not having the force of law)
of any such authority,  central bank or comparable agency shall make it unlawful
or impossible for the Liquidity  Provider (or its Lending Office) to maintain or
fund its LIBOR  Advances,  then upon  notice to the  Borrower  by the  Liquidity
Provider,  the  outstanding  principal  amount  of the LIBOR  Advances  shall be
converted to Base Rate  Advances (a)  immediately  upon demand of the  Liquidity
Provider, if such change or compliance with such request, in the judgment of the
Liquidity Provider,  requires immediate  repayment;  or (b) at the expiration of
the last Interest  Period to expire before the effective date of any such change
or request.

                                   ARTICLE IV.

                              CONDITIONS PRECEDENT
                              --------------------

          Section 4.1.  CONDITIONS  PRECEDENT TO  EFFECTIVENESS  OF SECTION 2.1.
Section 2.1 of this Agreement shall become effective on and as of the first date
(the  "EFFECTIVE  DATE") on which the following  conditions  precedent have been
satisfied or waived:

                      4.1.1.  The Liquidity  Provider  shall have received on or
          before the Closing Date each of the following, and in the case of each
          document delivered pursuant to paragraphs (i), (ii) and (iii), each in
          form and substance satisfactory to the Liquidity Provider:

                            (i) This Agreement  duly  executed  on behalf of the
                    Borrower;

                           (ii) The  Intercreditor  Agreement  duly  executed on
                    behalf of each of the parties thereto;

                          (iii) Fully executed  copies of each of the Operative
                    Agreements  executed and  delivered on or before the Closing
                    Date  (other  than  this  Agreement  and  the  Intercreditor
                    Agreement);

                           (iv) A copy of the Prospectus and specimen  copies of
                    the Class A Certificates;

                            (v) An executed copy of each  document,  instrument,
                    certificate  and opinion  delivered on or before the Closing
                    Date   pursuant  to  the  Class  A  Trust   Agreement,   the
                    Intercreditor  Agreement and the other Operative  Agreements


<PAGE>

                    (together with, in the case of each such opinion, other than
                    the opinion of counsel for the  Underwriters,  a letter from
                    the counsel  rendering  such  opinion to the effect that the
                    Liquidity Provider is entitled to rely on such opinion as of
                    its date as if it were addressed to the Liquidity Provider);

                           (vi)  Evidence  that  there  shall have been made and
                    shall be in full force and effect,  all filings,  recordings
                    and/or  registrations,  and there  shall  have been given or
                    taken  any  notice  or  other  similar   action  as  may  be
                    reasonably  necessary or, to the extent reasonably requested
                    by the Liquidity Provider, reasonably advisable, in order to
                    establish,  perfect,  protect and preserve the right,  title
                    and  interest,   remedies,  powers,  privileges,  liens  and
                    security  interests of, or for the benefit of, the Trustees,
                    the  Borrower  and the  Liquidity  Provider  created  by the
                    Operative  Agreements  executed and delivered on or prior to
                    the Closing Date;

                          (vii)  An  agreement  from  Continental,  pursuant  to
                    which (i) Continental  agrees to provide copies of quarterly
                    financial statements and audited annual financial statements
                    to the Liquidity Provider, and such other information as the
                    Liquidity  Provider shall reasonably request with respect to
                    the transactions  contemplated by the Operative  Agreements,
                    in  each  case,  only  to the  extent  that  Continental  is
                    obligated  to provide such  information  pursuant to Section
                    8.2.1  of  the  Leases  to  the  parties  thereto  and  (ii)
                    Continental  agrees  to  allow  the  Liquidity  Provider  to
                    inspect  Continental's  books  and  records  regarding  such
                    transactions, and to discuss such transactions with officers
                    and employees of Continental; and

                         (viii)  Such  other  documents,  instruments,  opinions
                    and   approvals  as  the  Liquidity   Provider   shall  have
                    reasonably requested.

                      4.1.2. The following  statement shall be true on and as of
          the Effective Date: no event has occurred and is continuing,  or would
          result from the entering  into of this  Agreement or the making of any
          Advance, which constitutes a Liquidity Event of Default.

                      4.1.3. The Liquidity  Provider shall have received payment
          in full of all fees and other sums  required  to be paid to or for the
          account of the Liquidity Provider on or prior to the Effective Date.

                      4.1.4.  All  conditions  precedent  to the issuance of the
          Certificates under the Trust Agreements shall have been satisfied, all
          conditions  precedent  to the  effectiveness  of the  other  Liquidity
          Facilities shall have been satisfied,  and all conditions precedent to
          the  purchase  of the  Certificates  by  the  Underwriters  under  the
          Underwriting  Agreement shall have been satisfied  (unless any of such
          conditions precedent shall have been waived by the Underwriters).


<PAGE>

                      4.1.5.  The Borrower  shall have  received a  certificate,
          dated the date hereof,  signed by a duly authorized  representative of
          the Liquidity  Provider,  certifying that all conditions  precedent to
          the effectiveness of Section 2.1 have been satisfied or waived.

          Section 4.2. CONDITIONS PRECEDENT TO BORROWING.  The obligation of the
Liquidity Provider to make an Advance on the occasion of each Borrowing shall be
subject to the conditions  precedent that the Effective Date shall have occurred
and,  prior to the date of such  Borrowing,  the Borrower shall have delivered a
Notice of Borrowing which conforms to the terms and conditions of this Agreement
and has been  completed as may be required by the relevant form of the Notice of
Borrowing for the type of Advances requested.

                                   ARTICLE V.

                                    COVENANTS
                                    ---------

          Section 5.1.  AFFIRMATIVE  COVENANTS OF THE  BORROWER.  So long as any
Advance  shall remain unpaid or the  Liquidity  Provider  shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount
to the Liquidity  Provider  hereunder,  the Borrower will,  unless the Liquidity
Provider shall otherwise consent in writing:

                      5.1.1.   PERFORMANCE   OF  THIS  AND   OTHER   AGREEMENTS.
          Punctually  pay or cause to be paid all  amounts  payable  by it under
          this  Agreement  and the other  Operative  Agreements  and observe and
          perform  in  all  material  respects  the  conditions,  covenants  and
          requirements  applicable  to it  contained in this  Agreement  and the
          other Operative Agreements.

                      5.1.2.  REPORTING  REQUIREMENTS.  Furnish to the Liquidity
          Provider with reasonable  promptness,  such other information and data
          with  respect  to  the  transactions  contemplated  by  the  Operative
          Agreements  as from time to time may be  reasonably  requested  by the
          Liquidity Provider; and permit the Liquidity Provider, upon reasonable
          notice,  to inspect the  Borrower's  books and records with respect to
          such  transactions  and to meet with  officers  and  employees  of the
          Borrower to discuss such transactions.

                      5.1.3.  CERTAIN  OPERATIVE  AGREEMENTS.   Furnish  to  the
          Liquidity   Provider  with  reasonable   promptness,   such  Operative
          Agreements entered into after the date hereof as from time to time may
          be reasonably requested by the Liquidity Provider.

          Section  5.2.  NEGATIVE  COVENANTS  OF THE  BORROWER.  So  long as any
Advance  shall remain unpaid or the  Liquidity  Provider  shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount
to the Liquidity Provider hereunder,  the Borrower will not appoint or permit or
suffer to be appointed any successor Borrower without the written consent of the
Liquidity Provider, which consent shall not be unreasonably withheld or delayed.


<PAGE>


                                   ARTICLE VI.

                           LIQUIDITY EVENTS OF DEFAULT
                           ---------------------------

          Section 6.1.  LIQUIDITY EVENTS OF DEFAULT.  If (a) any Liquidity Event
of Default has occurred  and is  continuing  and (b) there is a Performing  Note
Deficiency,  the  Liquidity  Provider  may,  in its  discretion,  deliver to the
Borrower a  Termination  Notice,  the effect of which shall be to cause (i) this
Agreement  to  expire  on the fifth  Business  Day after the date on which  such
Termination  Notice is received by the  Borrower,  (ii) the Borrower to promptly
request,  and the  Liquidity  Provider  to  promptly  make,  a Final  Advance in
accordance  with Section 2.2(d) hereof and Section  3.6(i) of the  Intercreditor
Agreement,  (iii) all other outstanding  Advances to be automatically  converted
into Final  Advances for purposes of determining  the Applicable  Liquidity Rate
for interest payable  thereon,  and (iv) subject to Sections 2.7 and 2.9 hereof,
all Advances  (including,  without limitation,  any Provider Advance and Applied
Provider   Advance),   any  accrued  interest  thereon  and  any  other  amounts
outstanding  hereunder to become  immediately  due and payable to the  Liquidity
Provider.

                                  ARTICLE VII.

                                  MISCELLANEOUS
                                  -------------

          Section 7.1. AMENDMENTS,  ETC. No amendment or waiver of any provision
of this Agreement, nor consent to any departure by the Borrower therefrom, shall
in any event be effective  unless the same shall be in writing and signed by the
Liquidity  Provider,  and,  in the case of an  amendment  or of a waiver  by the
Borrower,  the Borrower, and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given.

          Section 7.2.  NOTICES,  ETC.  Except as otherwise  expressly  provided
herein, all notices and other communications  provided for hereunder shall be in
writing (including telecopier and mailed or delivered or sent by telecopier):

          Borrower:                WILMINGTON TRUST COMPANY
                                   Rodney Square North
                                   1100 North Market Square
                                   Wilmington, DE 19890-0001

                                   Attention: Corporate Trust Administration
                                   Telephone: (302) 651-1000
                                   Telecopy:  (302) 651-8882

          Liquidity Provider:      ABN AMRO BANK N.V.
                                   Aerospace Department
                                   135 South LaSalle Street, #820
                                   Chicago, IL 60674-9135


<PAGE>
                                   Attention: Claudia Heldring, V.P.
                                   Telephone: (312) 904-5031
                                   Telecopy:  (312) 606-8428

                                   with a copy to:

                                   ABN AMRO Bank N.V.
                                   135 South LaSalle St., #625
                                   Chicago, IL 60674-9135

                                   Attention: Loan Operations
                                   Telephone: (312) 904-2961
                                   Telecopy:  (312) 606-6893

or, as to each of the foregoing, at such other address as shall be designated by
such  Person  in  a  written  notice  to  the  others.   All  such  notices  and
communications  shall be effective (i) if given by telecopier,  when transmitted
to the telecopier  number specified above, (ii) if given by mail, when deposited
in the mails  addressed as specified  above,  and (iii) if given by other means,
when delivered at the address  specified  above,  except that written notices to
the Liquidity  Provider pursuant to the provisions of Articles II and III hereof
shall not be effective until received by the Liquidity  Provider.  A copy of all
notices  delivered  hereunder  to either party shall in addition be delivered to
each  of the  parties  to  the  Participation  Agreements  at  their  respective
addresses set forth therein.

          Section  7.3.  NO  WAIVER;  REMEDIES.  No  failure  on the part of the
Liquidity Provider to exercise, and no delay in exercising, any right under this
Agreement  shall  operate as a waiver  thereof;  nor shall any single or partial
exercise  of any right  under  this  Agreement  preclude  any  other or  further
exercise  thereof  or the  exercise  of any other  right.  The  remedies  herein
provided are cumulative and not exclusive of any remedies provided by law.

          Section  7.4.  FURTHER  ASSURANCES.  The  Borrower  agrees  to do such
further  acts and things and to execute  and deliver to the  Liquidity  Provider
such additional assignments, agreements, powers and instruments as the Liquidity
Provider  may  reasonably  require or deem  advisable  to carry into  effect the
purposes  of this  Agreement  and the other  Operative  Agreements  or to better
assure and confirm unto the Liquidity  Provider its rights,  powers and remedies
hereunder and under the other Operative Agreements.

          Section  7.5.  INDEMNIFICATION;  SURVIVAL OF CERTAIN  PROVISIONS.  The
Liquidity  Provider  shall be  indemnified  hereunder  to the  extent and in the
manner described in Section 9.1 of the  Participation  Agreements.  In addition,
the  Borrower  agrees  to  indemnify,  protect,  defend  and hold  harmless  the
Liquidity Provider from, against and in respect of, and shall pay on demand, all
Expenses of any kind or nature whatsoever (other than any Expenses of the nature
described in Sections 3.1, 3.2 or 7.7 hereof or in the Fee Letter (regardless of
whether  indemnified  against pursuant to said Sections or in such Fee Letter)),
that may be imposed,  incurred by or asserted against any Liquidity  Indemnitee,
in any way relating to,  resulting from, or arising out of or in connection with
any  action,  suit or  proceeding  by any third  party  against  such  Liquidity


<PAGE>

Indemnitee and relating to this  Agreement,  the Fee Letter,  the  Intercreditor
Agreement or any Financing Agreement; PROVIDED, HOWEVER, that the Borrower shall
not be required to  indemnify,  protect,  defend and hold harmless any Liquidity
Indemnitee in respect of any Expense of such Liquidity  Indemnitee to the extent
such Expense is (i) attributable to the gross  negligence or willful  misconduct
of such Liquidity  Indemnitee or any other Liquidity  Indemnitee,  (ii) ordinary
and usual operating  overhead expense,  or (iii)  attributable to the failure by
such  Liquidity  Indemnitee  or any other  Liquidity  Indemnitee  to  perform or
observe any  agreement,  covenant or  condition  on its part to be  performed or
observed in this Agreement, the Intercreditor Agreement, the Fee Letter, the Tax
Letter or any other Operative  Agreement to which it is a party. The indemnities
contained in such Section 9.1, and the  provisions  of Sections  3.1,  3.2, 3.3,
3.9, 7.5 and 7.7 hereof, shall survive the termination of this Agreement.

          Section 7.6. LIABILITY OF THE LIQUIDITY PROVIDER.

                      7.6.1.  Neither  the  Liquidity  Provider  nor  any of its
          officers,  employees,  directors  or  affiliates  shall be  liable  or
          responsible  for: (i) the use which may be made of the Advances or any
          acts or omissions of the Borrower or any  beneficiary or transferee in
          connection therewith; (ii) the validity, sufficiency or genuineness of
          documents,  or of any  endorsement  thereon,  even if  such  documents
          should  prove  to be in  any or all  respects  invalid,  insufficient,
          fraudulent or forged; or (iii) the making of Advances by the Liquidity
          Provider against delivery of a Notice of Borrowing and other documents
          which do not comply with the terms hereof; PROVIDED, HOWEVER, that the
          Borrower  shall have a claim against the Liquidity  Provider,  and the
          Liquidity  Provider shall be liable to the Borrower,  to the extent of
          any damages  suffered by the Borrower which were the result of (A) the
          Liquidity  Provider's  willful misconduct or negligence in determining
          whether documents presented hereunder comply with the terms hereof, or
          (B) any breach by the  Liquidity  Provider of any of the terms of this
          Agreement,  including,  but not limited to, the  Liquidity  Provider's
          failure to make lawful payment  hereunder  after the delivery to it by
          the  Borrower of a Notice of  Borrowing  strictly  complying  with the
          terms and conditions hereof.

                      7.6.2.  Neither  the  Liquidity  Provider  nor  any of its
          officers,  employees,  director  or  affiliates  shall  be  liable  or
          responsible in any respect for (i) any error,  omission,  interruption
          or delay in  transmission,  dispatch  or  delivery  of any  message or
          advice, however transmitted,  in connection with this Agreement or any
          Notice of Borrowing delivered hereunder,  or (ii) any action, inaction
          or  omission  which may be taken by it in good faith,  absent  willful
          misconduct or  negligence  (in which event the extent of the Liquidity
          Provider's potential liability to the Borrower shall be limited as set
          forth in the immediately preceding paragraph), in connection with this
          Agreement or any Notice of Borrowing.

          Section 7.7. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay, or
cause to be paid (A) on the  Effective  Date and on such  later date or dates on
which the Liquidity  Provider shall make demand,  all  reasonable  out-of-pocket


<PAGE>

costs and expenses  (including,  without  limitation,  the  reasonable  fees and
expenses  of  outside  counsel  for the  Liquidity  Provider)  of the  Liquidity
Provider in connection with the preparation,  negotiation,  execution, delivery,
filing and recording of this Agreement,  any other  Operative  Agreement and any
other documents which may be delivered in connection with this Agreement and (B)
on demand, all reasonable costs and expenses (including  reasonable counsel fees
and expenses) of the Liquidity  Provider in connection  with (i) the enforcement
of this Agreement or any other  Operative  Agreement,  (ii) the  modification or
amendment of, or supplement to, this Agreement or any other Operative  Agreement
or such  other  documents  which may be  delivered  in  connection  herewith  or
therewith  (whether or not the same shall become  effective) or (iii) any action
or  proceeding  relating to any order,  injunction,  or other  process or decree
restraining or seeking to restrain the Liquidity Provider from paying any amount
under  this  Agreement,  the  Intercreditor  Agreement  or any  other  Operative
Agreement or otherwise affecting the application of funds in the Cash Collateral
Accounts. In addition,  the Borrower shall pay any and all recording,  stamp and
other  similar  taxes and fees payable or determined to be payable in connection
with the execution,  delivery, filing and recording of this Agreement, any other
Operative  Agreement and such other documents,  and agrees to save the Liquidity
Provider  harmless from and against any and all  liabilities  with respect to or
resulting from any delay in paying or omission to pay such taxes or fees.

          Section 7.8. BINDING EFFECT; PARTICIPATIONS.

                      7.8.1.  This Agreement  shall be binding upon and inure to
          the  benefit of the  Borrower  and the  Liquidity  Provider  and their
          respective  successors and assigns,  except that neither the Liquidity
          Provider  (except  as  otherwise  provided  in this  Section  7.8) nor
          (except as  contemplated  by Section 3.8) the Borrower  shall have the
          right to assign its rights or  obligations  hereunder  or any interest
          herein without the prior written  consent of the other party,  subject
          to the  requirements  of Section  7.8(b).  The Liquidity  Provider may
          grant  participations  herein  or  in  any  of  its  rights  hereunder
          (including,    without   limitation,    funded    participations   and
          participations in rights to receive interest  payments  hereunder) and
          under the other Operative  Agreements to such Persons as the Liquidity
          Provider  may  in  its  sole   discretion   select,   subject  to  the
          requirements of Section 7.8(b). No such participation by the Liquidity
          Provider,   however,  will  relieve  the  Liquidity  Provider  of  its
          obligations  hereunder.  In connection with any  participation  or any
          proposed  participation,  the  Liquidity  Provider may disclose to the
          participant  or the  proposed  participant  any  information  that the
          Borrower  is  required  to deliver  or to  disclose  to the  Liquidity
          Provider  pursuant to this Agreement.  The Borrower  acknowledges  and
          agrees  that the  Liquidity  Provider's  source of funds may derive in
          part from its  participants  (other  than  Continental).  Accordingly,
          references  in this  Agreement and the other  Operative  Agreements to
          determinations,  reserve and capital adequacy requirements,  increased
          costs,  reduced receipts,  additional  amounts due pursuant to Section
          3.3(a) and the like as they pertain to the Liquidity Provider shall be


<PAGE>

          deemed also to include those of each of its participants  (subject, in
          each case,  to the maximum  amount that would have been incurred by or
          attributable  to the  Liquidity  Provider  directly  if the  Liquidity
          Provider,   rather  than  the  participant,   had  held  the  interest
          participated).

                      7.8.2. If, pursuant to subsection (a) above, the Liquidity
          Provider  sells any  participation  in this  Agreement  to any bank or
          other entity  (each,  a  "TRANSFEREE"),  then,  concurrently  with the
          effectiveness  of  such   participation,   the  Transferee  shall  (i)
          represent to the Liquidity  Provider (for the benefit of the Liquidity
          Provider and the Borrower)  either (A) that it is  incorporated  under
          the laws of the  United  States or a state  thereof  or (B) that under
          applicable law and treaties,  no taxes will be required to be withheld
          with respect to any payments to be made to such  Transferee in respect
          of this  Agreement,  (ii)  furnish to the  Liquidity  Provider and the
          Borrower either (x) a statement that it is incorporated under the laws
          of  the  United  States  or a  state  thereof  or  (y) if it is not so
          incorporated,  two  copies  of  a  properly  completed  United  States
          Internal  Revenue Service Form 4224 or Form 1001, as  appropriate,  or
          other  applicable  form,  certificate  or document  prescribed  by the
          Internal Revenue Service  certifying,  in each case, such Transferee's
          entitlement  to  a  complete  exemption  from  United  States  federal
          withholding  tax in  respect  to  any  and  all  payments  to be  made
          hereunder,  and (iii) agree (for the benefit of the Liquidity Provider
          and the Borrower) to provide the Liquidity Provider and the Borrower a
          new Form 4224 or Form 1001, as appropriate,  (A) on or before the date
          that any such  form  expires  or  becomes  obsolete  or (B)  after the
          occurrence  of any event  requiring  a change in the most  recent form
          previously delivered by it and prior to the immediately  following due
          date of any payment by the Borrower hereunder,  certifying in the case
          of a Form  1001 or Form 4224 that such  Transferee  is  entitled  to a
          complete  exemption  from United  States  federal  withholding  tax on
          payments under this Agreement.  Unless the Borrower has received forms
          or other  documents  reasonably  satisfactory  to it (and  required by
          applicable law) indicating that payments  hereunder are not subject to
          United  States  federal  withholding  tax, the Borrower  will withhold
          taxes  as  required  by law  from  such  payments  at  the  applicable
          statutory rate.

                      7.8.3.   Notwithstanding  the  other  provisions  of  this
          Section 7.8, the  Liquidity  Provider may assign and pledge all or any
          portion of the Advances owing to it to any Federal Reserve Bank or the
          United States Treasury as collateral security pursuant to Regulation A
          of the  Board of  Governors  of the  Federal  Reserve  System  and any
          Operating Circular issued by such Federal Reserve Bank,  provided that
          any payment in respect of such assigned  Advances made by the Borrower
          to the  Liquidity  Provider  in  accordance  with  the  terms  of this
          Agreement  shall  satisfy  the  Borrower's  obligations  hereunder  in
          respect of such  assigned  Advance to the extent of such  payment.  No
          such  assignment  shall  release  the  Liquidity   Provider  from  its
          obligations hereunder.

          Section 7.9.  SEVERABILITY.  Any provision of this Agreement  which is
prohibited,  unenforceable  or not authorized in any  jurisdiction  shall, as to


<PAGE>

such   jurisdiction,   be  ineffective  to  the  extent  of  such   prohibition,
unenforceability   or  nonauthorization   without   invalidating  the  remaining
provisions hereof or affecting the validity,  enforceability or legality of such
provision in any other jurisdiction.

          Section 7.10.  GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

          Section 7.11. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; WAIVER
OF IMMUNITY.

                      7.11.1.  Each of the parties hereto hereby irrevocably and
          unconditionally:

                            (i) submits for itself and its property in any legal
                    action or proceeding relating to this Agreement or any other
                    Operative  Agreement,  or for recognition and enforcement of
                    any   judgment  in  respect   hereof  or  thereof,   to  the
                    nonexclusive general jurisdiction of the courts of the State
                    of New York,  the courts of the United States of America for
                    the Southern  District of New York, and the appellate courts
                    from any thereof;

                           (ii) consents that any such action or proceeding  may
                    be brought in such courts,  and waives any objection that it
                    may now or hereafter have to the venue of any such action or
                    proceeding  in  any  such  court  or  that  such  action  or
                    proceeding was brought in an  inconvenient  court and agrees
                    not to plead or claim the same;

                          (iii)  agrees  that  service  of  process in any  such
                    action  or  proceeding  may be  effected  by  mailing a copy
                    thereof   by   registered   or   certified   mail   (or  any
                    substantially  similar form of mail),  postage  prepaid,  to
                    each party  hereto at its  address  set forth in Section 7.2
                    hereof,  or at such  other  address  of which the  Liquidity
                    Provider shall have been notified pursuant thereto; and

                           (iv)  agrees that  nothing  herein  shall  affect the
                    right to effect  service  of  process  in any  other  manner
                    permitted  by law or  shall  limit  the  right to sue in any
                    other jurisdiction.

                     7.11.2. THE BORROWER AND THE LIQUIDITY PROVIDER EACH HEREBY
          AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
          CAUSE OF ACTION  BASED UPON OR ARISING  OUT OF THIS  AGREEMENT  OR ANY
          DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT
          AND THE RELATIONSHIP  THAT IS BEING  ESTABLISHED,  including,  without
          limitation,  contract claims,  tort claims,  breach of duty claims and
          all other  common  law and  statutory  claims.  The  Borrower  and the


<PAGE>

          Liquidity  Provider  each warrant and  represent  that it has reviewed
          this  waiver  with  its  legal  counsel,  and  that it  knowingly  and
          voluntarily  waives its jury trial rights following  consultation with
          such legal counsel. THIS WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED
          EITHER  ORALLY  OR IN  WRITING,  AND THIS  WAIVER  SHALL  APPLY TO ANY
          SUBSEQUENT AMENDMENTS,  RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
          AGREEMENT.

                      7.11.3.  The Liquidity Provider hereby waives any immunity
          it may have from the  jurisdiction  of the courts of the United States
          or of any State and waives any immunity any of its properties  located
          in the United  States may have from  attachment  or  execution  upon a
          judgement  entered by any such court under the United  States  Foreign
          Sovereign Immunities Act of 1976 or any similar successor legislation.

          Section  7.12.  EXECUTION  IN  COUNTERPARTS.  This  Agreement  may  be
executed  in any  number of  counterparts  and by  different  parties  hereto on
separate  counterparts,  each  of  which  counterparts,  when  so  executed  and
delivered,  shall be deemed  to be an  original  and all of which  counterparts,
taken together, shall constitute but one and the same Agreement.

          Section 7.13. ENTIRETY.  This Agreement,  the Intercreditor  Agreement
and the other  Operative  Agreements to which the Liquidity  Provider is a party
constitute  the entire  agreement  of the  parties  hereto  with  respect to the
subject matter hereof and supersedes all prior  understandings and agreements of
such parties.

          Section  7.14.  HEADINGS.  Section  headings  in  this  Agreement  are
included  herein for  convenience  of reference  only and shall not constitute a
part of this Agreement for any other purpose.

          Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES. EXCEPT
AS EXPRESSLY  SET FORTH IN THIS  AGREEMENT,  THE  OBLIGATIONS  OF THE  LIQUIDITY
PROVIDER  TO MAKE  ADVANCES  HEREUNDER,  AND THE  BORROWER'S  RIGHTS TO  DELIVER
NOTICES OF  BORROWING  REQUESTING  THE MAKING OF  ADVANCES  HEREUNDER,  SHALL BE
UNCONDITIONAL  AND  IRREVOCABLE,  AND SHALL BE PAID OR  PERFORMED,  IN EACH CASE
STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT.

                                      * * *


<PAGE>

          IN WITNESS WHEREOF,  the parties have caused this Agreement to be duty
executed and delivered by their respective officers thereunto duly authorized as
of the date first set forth above.


                                                                       
                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination   Agent,   as  agent   and
                                        trustee  for  the  Class  A  Trust,   as
                                        Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:



                                      ABN  AMRO  BANK N.V.,  acting  through its
                                        Chicago Branch, as Liquidity Provider



                                      By:_______________________________________
                                         Name:
                                         Title:



                                      By:_______________________________________
                                         Name:
                                         Title:


<PAGE>


                                                                      Annex I to
                                                      Revolving Credit Agreement


                      INTEREST ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
borrower (the  "BORROWER"),  hereby  certifies to ABN AMRO N.V.,  Chicago Branch
(the "LIQUIDITY  PROVIDER"),  with reference to the Revolving  Credit  Agreement
(1997-3A) dated as of September 25, 1997, between the Borrower and the Liquidity
Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein and not otherwise
defined herein being used herein as therein defined or referenced), that:

          (a) The Borrower is the  Subordination  Agent under the  Intercreditor
Agreement.

          (b) The Borrower is delivering this Notice of Borrowing for the making
of an Interest  Advance by the Liquidity  Provider to be used for the payment of
the   interest   on  the   Class   A   Certificates   which   was   payable   on
_____________________ (the "DISTRIBUTION DATE") in accordance with the terms and
provisions of the Class A Trust  Agreement and the Class A  Certificates,  which
Advance is requested to be made on __________.

          (c)  The  amount  of the  Interest  Advance  requested  hereby  (i) is
$_________________,  to be applied in  respect  of the  payment of the  interest
which was due and payable on the Class A Certificates on the Distribution  Date,
(ii) does not include any amount with respect to the payment of principal of, or
premium on, the Class A  Certificates,  the Class B Certificates  or the Class C
Certificates,   or  interest  on  the  Class  B  Certificates  or  the  Class  C
Certificates,  (iii) was computed in accordance with the provisions of the Class
A Certificates,  the Class A Trust Agreement and the Intercreditor  Agreement (a
copy of which  computation  is  attached  hereto as  Schedule  I), (iv) does not
exceed the Maximum Available  Commitment on the date hereof and (v) has not been
and is not the subject of a prior or contemporaneous Notice of Borrowing.

          (d)  Upon  receipt  by or on  behalf  of the  Borrower  of the  amount
requested  hereby,  (a) the Borrower will apply the same in accordance  with the
terms of Section  3.6(b) of the  Intercreditor  Agreement (b) no portion of such
amount shall be applied by the Borrower for any other purpose and (c) no portion
of such amount until so applied shall be commingled with other funds held by the
Borrower.

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  the making of the  Interest  Advance as  requested by this Notice of
Borrowing shall  automatically  reduce,  subject to  reinstatement in accordance
with the terms of the Liquidity  Agreement,  the Maximum Available Commitment by
an amount  equal to the  amount of the  Interest  Advance  requested  to be made
hereby as set forth in clause (i) of paragraph (3) of this  Certificate and such
reduction shall automatically result in corresponding  reductions in the amounts
available to be borrowed pursuant to a subsequent Advance.


<PAGE>

                                      * * *

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the day of _________ day of ________________, ____.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:



<PAGE>

               SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING



     [Insert Copy of Computations in accordance with Interest  Advance Notice of
Borrowing]



<PAGE>
                                                                        Annex II
                                                      Revolving Credit Agreement


                    NON-EXTENSION ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
subordination  agent (the  "BORROWER"),  hereby certifies to ABN AMRO BANK N.V.,
Chicago  Branch (the  "LIQUIDITY  PROVIDER"),  with  reference to the  Revolving
Credit Agreement  (1997-3A) dated as of September 25, 1997, between the Borrower
and the Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein
and not  otherwise  defined  herein  being  used  herein as  therein  defined or
referenced), that:

          (a) The Borrower is the  Subordination  Agent under the  Intercreditor
Agreement.

          (b) The Borrower is delivering this Notice of Borrowing for the making
of the  Non-Extension  Advance  by the  Liquidity  Provider  to be used  for the
funding of the Class A Cash Collateral Account in accordance with Section 3.6(d)
of the  Intercreditor  Agreement,  which  Advance  is  requested  to be  made on
__________________.

          (c) The amount of the  Non-Extension  Advance  requested hereby (i) is
$__________,  which equals the Maximum  Available  Commitment on the date hereof
and is to be applied in  respect of the  funding of the Class A Cash  Collateral
Account in accordance with Section 3.6(d) of the Intercreditor  Agreement,  (ii)
does not include any amount with respect to the payment of the  principal of, or
premium on, the Class A  Certificates,  or principal  of, or interest or premium
on, the Class B Certificates or the Class C Certificates,  (iii) was computed in
accordance  with the provisions of the Class A  Certificates,  the Class A Trust
Agreement  and the  Intercreditor  Agreement  (a copy of  which  computation  is
attached  hereto as Schedule I), and (iv) has not been and is not the subject of
a prior or contemporaneous Notice of Borrowing under the Liquidity Agreement.

          (d)  Upon  receipt  by or on  behalf  of the  Borrower  of the  amount
requested hereby,  (a) the Borrower will deposit such amount in the Class A Cash
Collateral  Account and apply the same in  accordance  with the terms of Section
3.6(d) of the  Intercreditor  Agreement,  (b) no portion of such amount shall be
applied by the Borrower for any other  purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the Borrower.


<PAGE>

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the  Non-Extension  Advance as  requested  by this
Notice of Borrowing shall automatically and irrevocably terminate the obligation
of  the  Liquidity  Provider  to  make  further  Advances  under  the  Liquidity
Agreement;  and (B)  following  the  making  by the  Liquidity  Provider  of the
Non-Extension Advance requested by this Notice of Borrowing,  the Borrower shall
not be entitled to request any further Advances under the Liquidity Agreement.

                                      * * *

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the day of _______ day of ___________________, ______.


                                        WILMINGTON  TRUST  COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                        By:_____________________________________
                                           Name:
                                           Title:



<PAGE>


             SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING

                 [Insert Copy of computations in accordance with
                   Non-Extension Advance Notice of Borrowing]



<PAGE>

                                                                    Annex III to
                                                      Revolving Credit Agreement


                      DOWNGRADE ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
subordination  agent (the  "BORROWER"),  hereby certifies to ABN AMRO BANK N.V.,
Chicago  Branch (the  "LIQUIDITY  PROVIDER"),  with  reference to the  Revolving
Credit Agreement  (1997-3A) dated as of September 25, 1997, between the Borrower
and the Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein
and not  otherwise  defined  herein  being  used  herein as  therein  defined or
referenced), that:

          (a) The Borrower is the  Subordination  Agent under the  Intercreditor
Agreement.

          (b) The Borrower is delivering this Notice of Borrowing for the making
of the Downgrade Advance by the Liquidity Provider to be used for the funding of
the Class A Cash  Collateral  Account in accordance  with Section  3.6(c) of the
Intercreditor Agreement by reason of the downgrading of the short-term unsecured
debt rating of the Liquidity  Provider  issued by either Rating Agency below the
Threshold Rating, which Advance is requested to be made on ____________, _____.

          (c) The  amount  of the  Downgrade  Advance  requested  hereby  (i) is
$_______,  which equals the Maximum Available  Commitment on the date hereof and
is to be  applied  in  respect  of the  funding  of the Class A Cash  Collateral
Account in accordance with Section 3.6(c) of the Intercreditor  Agreement,  (ii)
does not include any amount with respect to the payment of the  principal of, or
premium on, the Class A  Certificates,  or principal  of, or interest or premium
on, the Class B Certificates or the Class C Certificates,  (iii) was computed in
accordance  with the provisions of the Class A  Certificates,  the Class A Trust
Agreement  and the  Intercreditor  Agreement  (a copy of  which  computation  is
attached  hereto as Schedule I), and (iv) has not been and is not the subject of
a prior or contemporaneous Notice of Borrowing under the Liquidity Agreement.

          (d)  Upon  receipt  by or on  behalf  of the  Borrower  of the  amount
requested hereby,  (a) the Borrower will deposit such amount in the Class A Cash
Collateral  Account and apply the same in  accordance  with the terms of Section
3.6(c) of the  Intercreditor  Agreement,  (b) no portion of such amount shall be
applied by the Borrower for any other  purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the Borrower.

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the Downgrade  Advance as requested by this Notice
of Borrowing shall automatically and irrevocably terminate the obligation of the
Liquidity Provider to make further Advances under the Liquidity  Agreement;  and


<PAGE>

(B)  following the making by the  Liquidity  Provider of the  Downgrade  Advance
requested by this Notice of  Borrowing,  the  Borrower  shall not be entitled to
request any further Advances under the Liquidity Agreement.

                                      * * *

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the ___ day of ____________, ____.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:



<PAGE>


               SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING

                 [Insert Copy of computations in accordance with
                     Downgrade Advance Notice of Borrowing]



<PAGE>
                                                                     Annex IV to
                                                      Revolving Credit Agreement


                        FINAL ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
borrower  (the  "BORROWER"),  hereby  certifies  to ABN AMRO BANK N.V.,  Chicago
Branch (the  "LIQUIDITY  PROVIDER"),  with  reference  to the  Revolving  Credit
Agreement (1997-3A) dated as of September 25, 1997, between the Borrower and the
Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein and not
otherwise  defined herein being used herein as therein  defined or  referenced),
that:

          (a) The Borrower is the  Subordination  Agent under the  Intercreditor
Agreement.

          (b) The Borrower is delivering this Notice of Borrowing for the making
of the Final Advance by the Liquidity Provider to be used for the funding of the
Class A Cash  Collateral  Account  in  accordance  with  Section  3.6(i)  of the
Intercreditor  Agreement  by  reason  of  the  receipt  by  the  Borrower  of  a
Termination  Notice from the  Liquidity  Provider  with respect to the Liquidity
Agreement, which Advance is requested to be made on ______________, ___.

          (c)  The  amount  of  the  Final  Advance   requested  hereby  (i)  is
$__________,  which equals the Maximum  Available  Commitment on the date hereof
and is to be applied in  respect of the  funding of the Class A Cash  Collateral
Account in accordance with Section 3.6(i) of the Intercreditor  Agreement,  (ii)
does not  include any amount with  respect to the  payment of  principal  of, or
premium on, the Class A  Certificates,  or principal  of, or interest or premium
on, the Class B Certificates or the Class C Certificates,  (iii) was computed in
accordance  with the provisions of the Class A  Certificates,  the Class A Trust
Agreement  and the  Intercreditor  Agreement  (a copy of  which  computation  is
attached  hereto as Schedule I), and (iv) has not been and is not the subject of
a prior or contemporaneous Notice of Borrowing.

          (d)  Upon  receipt  by or on  behalf  of the  Borrower  of the  amount
requested hereby,  (a) the Borrower will deposit such amount in the Class A Cash
Collateral  Account and apply the same in  accordance  with the terms of Section
3.6(i) of the  Intercreditor  Agreement,  (b) no portion of such amount shall be
applied by the Borrower for any other  purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the Borrower.

          (e) The Borrower hereby requests that the Advance  requested hereby be
a Base Rate Advance  [and that such Base Rate Advance be converted  into a LIBOR
Advance on the third Business Day following your receipt of this notice].<F1>

___________________

<F1>Bracketed language is optional.


<PAGE>

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the Final  Advance as  requested by this Notice of
Borrowing shall  automatically  and irrevocably  terminate the obligation of the
Liquidity Provider to make further Advances under the Liquidity  Agreement;  and
(B)  following  the  making  by the  Liquidity  Provider  of the  Final  Advance
requested by this Notice of  Borrowing,  the  Borrower  shall not be entitled to
request any further Advances under the Liquidity Agreement.

                                      * * *

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the ___ day of _________________, ____.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_____________________________________
                                         Name:
                                         Title:



<PAGE>


                 SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING

                 [Insert Copy of Computations in accordance with
                       Final Advance Notice of Borrowing]



<PAGE>
                                                                      Annex V to
                                                      Revolving Credit Agreement


                              NOTICE OF TERMINATION


[Date]

Wilmington Trust Company,
as Subordination Agent, as Borrower
Rodney Square North
North Market Square
Wilmington, DE 19890-0001

Attention: Corporate Trust Administration

          Revolving  Credit  Agreement  dated as of September 25, 1997,  between
Wilmington Trust Company,  as Subordination  Agent, as agent and trustee for the
Continental Airlines Pass Through Trust, 1997-3A, as Borrower, and ABN AMRO BANK
N.V., Chicago Branch (the "Liquidity Agreement")

Ladies and Gentlemen:

          You are hereby  notified that pursuant to Section 6.1 of the Liquidity
Agreement,  by reason of the occurrence of a Liquidity  Event of Default and the
existence of a Performing  Note  Deficiency  (each as defined  therein),  we are
giving this notice to you in order to cause (i) our obligations to make Advances
(as defined  therein) under such  Liquidity  Agreement to terminate on the fifth
Business  Day after the date on which you  receive  this  notice and (ii) you to
request a Final Advance under the Liquidity Agreement pursuant to Section 3.6(i)
of the  Intercreditor  Agreement  (as defined in the  Liquidity  Agreement) as a
consequence of your receipt of this notice.


<PAGE>

          THIS  NOTICE IS THE  "NOTICE OF  TERMINATION"  PROVIDED  FOR UNDER THE
LIQUIDITY  AGREEMENT.  OUR  OBLIGATIONS  TO MAKE  ADVANCES  UNDER THE  LIQUIDITY
AGREEMENT  WILL  TERMINATE ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU
RECEIVE THIS NOTICE.


                                        Very truly yours,


                                        ABN AMRO BANK N.V.,  Chicago Branch,  as
                                          Liquidity Provider



                                        By:_____________________________________
                                           Name:
                                           Title:



                                        By:_____________________________________
                                           Name:
                                           Title:

cc:  Wilmington Trust Company,
      as Class A Trustee


<PAGE>
                                                                     Annex VI to
                                                      Revolving Credit Agreement


                    NOTICE OF REPLACEMENT SUBORDINATION AGENT


[Date]
Attention:

          Revolving  Credit  Agreement  dated as of September 25, 1997,  between
Wilmington Trust Company,  as Subordination  Agent, as agent and trustee for the
Continental Airlines Pass Through Trust, 1997-3A, as Borrower, and ABN AMRO BANK
N.V., Chicago Branch (the "Liquidity Agreement")

Ladies and Gentlemen:

          For value received,  the undersigned  beneficiary  hereby  irrevocably
transfers to:


                              (Name of Transferee)


                              (Name of Transferee)

all rights and  obligations  of the  undersigned as Borrower under the Liquidity
Agreement  referred to above.  The transferee  has succeeded the  undersigned as
Subordination  Agent under the Intercreditor  Agreement referred to in the first
paragraph of the  Liquidity  Agreement,  pursuant to the terms of Section 8.1 of
the Intercreditor Agreement.

          By this transfer,  all rights of the undersigned as Borrower under the
Liquidity  Agreement are transferred to the transferee and the transferee  shall
hereafter  have the sole  rights and  obligations  as Borrower  thereunder.  The
undersigned  shall pay any costs and expenses of such transfer,  including,  but
not limited to, transfer taxes or governmental charges.

          We ask that this transfer be effective as of _______________, ___.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        ____________   individual  capacity  but
                                        solely  as   Subordination   Agent,   as
                                        Borrower



                                        By:_____________________________________
                                           Name:
                                           Title:






================================================================================


                           REVOLVING CREDIT AGREEMENT
                                    (1997-3B)



                         Dated as of September 25, 1997

                                     between

                            WILMINGTON TRUST COMPANY,

                             as Subordination Agent,
                          as agent and trustee for the
                 Continental Airlines Pass Through Trust 1997-3B

                                   as Borrower

                                       and



                       ABN AMRO BANK N.V., CHICAGO BRANCH

                              as Liquidity Provider




                                   Relating to

                 Continental Airlines Pass Through Trust 1997-3B
             7.140% Continental Airlines Pass Through Certificates,
                                 Series 1997-3B


================================================================================


<PAGE>


<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

                                   ARTICLE I.

                                   DEFINITIONS
<S>             <C>                                                          <C>
Section 1.1     Certain Defined Terms..........................................1

                                   ARTICLE II.

                       AMOUNT AND TERMS OF THE COMMITMENT

Section 2.1    The Advances....................................................6
Section 2.2    Making the Advances.............................................7
Section 2.3.   Fees............................................................9
Section 2.4.   Adjustments or Termination of the Maximum Commitment............9
Section 2.5.   Repayments of Interest Advances or the Final Advance............9
Section 2.6.   Repayments of Provider Advances................................10
Section 2.7.   Payments to the Liquidity Provider Under the Intercreditor
               Agreement......................................................11
Section 2.8.   Book Entries...................................................11
Section 2.9.   Payments from Available Funds Only.............................11
Section 2.10.  Extension of the Expiry Date; Non-Extension Advance............11

                                  ARTICLE III.

                           OBLIGATIONS OF THE BORROWER

Section 3.1.   Increased Costs................................................12
Section 3.2.   Capital Adequacy...............................................13
Section 3.3.   Payments Free of Deductions....................................13
Section 3.4.   Payments.......................................................14
Section
 3.5.   Computations...................................................14
Section 3.6.   Payment on Non-Business Days...................................14
Section 3.7.   Interest.......................................................14
Section 3.8.   Replacement of Borrower........................................16
Section 3.9.   Funding Loss Indemnification...................................16
Section 3.10.  Illegality.....................................................17



<PAGE>

                                TABLE OF CONTENTS
                                  (Continued)

                                                                            PAGE
                                                                            ----

                                  ARTICLE IV.

                              CONDITIONS PRECEDENT

Section 4.1.   Conditions Precedent to Effectiveness of Section 2.1...........17
Section 4.2.   Conditions Precedent to Borrowing..............................19

                                   ARTICLE V.

                                    COVENANTS

Section 5.1.   Affirmative Covenants of the Borrower..........................19
Section 5.2.   Negative Covenants of the Borrower.............................19

                                   ARTICLE VI.

                           LIQUIDITY EVENTS OF DEFAULT

Section 6.1.   Liquidity Events of Default....................................20

                                  ARTICLE VII.

                                  MISCELLANEOUS

Section 7.1.   Amendments, Etc................................................20
Section 7.2.   Notices, Etc...................................................20
Section 7.3.   No Waiver; Remedies............................................21
Section 7.4.   Further Assurances.............................................21
Section 7.5.   Indemnification; Survival of Certain Provisions................21
Section 7.6.   Liability of the Liquidity Provider............................22
Section 7.7.   Costs, Expenses and Taxes......................................22
Section 7.8.   Binding Effect; Participations.................................23
Section 7.9.   Severability...................................................24
Section 7.10.  Governing Law..................................................25
Section 7.11.  Submission to Jurisdiction; Waiver of Jury Trial; Waiver of
               Immunity.......................................................25
Section 7.12.  Execution in Counterparts......................................26
Section 7.13.  Entirety.......................................................26
Section 7.14.  Headings.......................................................26
Section 7.15.  Liquidity Provider's Obligation To Make Advances...............26




<PAGE>

                                TABLE OF CONTENTS
                                  (Continued)


ANNEX I    Interest Advance Notice of Borrowing

ANNEX II   Non-Extension Advance Notice of Borrowing

ANNEX III  Downgrade Advance Notice of Borrowing

ANNEX IV   Final Advance Notice of Borrowing

ANNEX V    Notice of Termination

ANNEX VI   Notice of Replacement Subordination Agent

</TABLE>




<PAGE>


                           REVOLVING CREDIT AGREEMENT


          This  REVOLVING  CREDIT  AGREEMENT  dated as of  September  25,  1997,
between WILMINGTON TRUST COMPANY, a Delaware corporation,  not in its individual
capacity but solely as  Subordination  Agent under the  Intercreditor  Agreement
(each as defined below),  as agent and trustee for the Class B Trust (as defined
below) (the "BORROWER"), and ABN AMRO BANK N.V., a bank organized under the laws
of The  Netherlands,  acting  through  its  Chicago  Branch  ("ABN  AMRO" or the
"LIQUIDITY PROVIDER").

                              W I T N E S S E T H:
                              - - - - - - - - - -

          WHEREAS,  pursuant to the Class B Trust  Agreement  (such term and all
other  capitalized terms used in these recitals having the meanings set forth or
referred  to in  Section  1.1),  the  Class  B  Trust  is  issuing  the  Class B
Certificates; and

          WHEREAS,  the  Borrower,  in order to support the timely  payment of a
portion of the interest on the Class B  Certificates  in  accordance  with their
terms,  has  requested  the  Liquidity  Provider  to enter into this  Agreement,
providing in part for the Borrower to request in  specified  circumstances  that
Advances be made hereunder.

          NOW, THEREFORE,  in consideration of the premises,  the parties hereto
agree as follows:

                                   ARTICLE I.

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

          Section 1.1. CERTAIN DEFINED TERMS.  (a) DEFINITIONS.  As used in this
Agreement  and unless  otherwise  expressly  indicated,  or unless  the  context
clearly  requires  otherwise,  the  following  capitalized  terms shall have the
following respective meanings for all purposes of this Agreement:

          "ADDITIONAL  COST" has the  meaning  assigned  to such term in Section
     3.1.

          "ADVANCE"  means an  Interest  Advance,  a Final  Advance,  a Provider
     Advance,  an Applied Provider Advance or an Unpaid Advance, as the case may
     be.

          "APPLICABLE  LIQUIDITY RATE" has the meaning  assigned to such term in
     Section 3.7(g).

          "APPLICABLE  MARGIN"  means (w) with respect to any Unpaid  Advance or
     Applied  Provider  Advance,  2.00% or (x)  with  respect  to any  Unapplied
     Provider Advance, .40%.

          "APPLIED  DOWNGRADE  ADVANCE" has the meaning assigned to such term in
     Section 2.6(a).


<PAGE>

          "APPLIED  NON-EXTENSION ADVANCE" has the meaning assigned to such term
     in Section 2.6(a).

          "APPLIED  PROVIDER  ADVANCE" has the meaning  assigned to such term in
     Section 2.6(a).

          "BASE RATE" means a fluctuating interest rate per annum in effect from
     time to time,  which rate per annum  shall at all times be equal to (a) the
     weighted average of the rates on overnight Federal funds  transactions with
     members of the Federal Reserve System arranged by Federal funds brokers, as
     published for such day (or, if such day is not a Business Day, for the next
     preceding Business Day) by the Federal Reserve Bank of New York, or if such
     rate is not so published for any day that is a Business Day, the average of
     the quotations for such day for such transactions received by the Liquidity
     Provider from three Federal funds brokers of recognized  standing  selected
     by it, plus (b) one-quarter of one percent (1/4 of 1%).

          "BASE RATE  ADVANCE"  means an Advance  that bears  interest at a rate
     based upon the Base Rate.

          "BORROWER"  has the  meaning  assigned  to such term in the recital of
     parties to this Agreement.

          "BORROWING"  means the making of Advances  requested  by delivery of a
     Notice of Borrowing.

          "BUSINESS  DAY" means any day other than a Saturday or Sunday or a day
     on which  commercial  banks are required or authorized to close in Houston,
     Texas,  New York,  New York,  Chicago,  Illinois or, so long as any Class B
     Certificate  is  outstanding,  the city and  state  in  which  the  Class B
     Trustee,  the Borrower or any Loan Trustee  maintains its  Corporate  Trust
     Office or receives or disburses funds, and, if the applicable  Business Day
     relates to any Advance or other amount bearing  interest based on the LIBOR
     Rate, on which dealings are carried on in the London interbank market.

          "DOWNGRADE ADVANCE" means an Advance made pursuant to Section 2.2(c).

          "EFFECTIVE  DATE"  has the  meaning  specified  in  Section  4.1.  The
     delivery of the  certificate  of the  Liquidity  Provider  contemplated  by
     Section  4.1(e) shall be conclusive  evidence  that the Effective  Date has
     occurred.

          "EXCLUDED  TAXES" means (i) taxes imposed on the overall net income of
     the Liquidity  Provider or of its Lending Office by the jurisdiction  where
     such  Liquidity  Provider's  principal  office  or such  Lending  Office is
     located, and (ii) Excluded Withholding Taxes.

          "EXCLUDED  WITHHOLDING  TAXES" means (i) withholding  Taxes imposed by
     the United States except to the extent that such United States  withholding


<PAGE>

     Taxes are  imposed  as a result of any change in  applicable  law after the
     date hereof  (excluding  from change in  applicable  law for this purpose a
     change  in an  applicable  treaty  or other  change  in law  affecting  the
     applicability  of a  treaty),  or in  the  case  of a  successor  Liquidity
     Provider  (including a transferee of an Advance) or Lending  Office,  after
     the date on which such successor Liquidity Provider obtains its interest or
     on which the Lending  Office is  changed,  and (ii) any  withholding  Taxes
     imposed by the United  States which are imposed or increased as a result of
     the Liquidity  Provider  failing to deliver to the Borrower any certificate
     or document  (which  certificate  or document in the good faith judgment of
     the  Liquidity  Provider  it is  legally  entitled  to  provide)  which  is
     reasonably  requested by the Borrower to establish that payments under this
     Agreement  are exempt from (or entitled to a reduced  rate of)  withholding
     Tax.

          "EXPENSES"  means  liabilities,   obligations,  damages,  settlements,
     penalties,  claims,  actions,  suits,  costs,  expenses,  and disbursements
     (including, without limitation,  reasonable fees and disbursements of legal
     counsel  and costs of  investigation),  provided  that  Expenses  shall not
     include any Taxes.

          "EXPIRY  DATE" means  September  24, 1998,  initially,  or any date to
     which the Expiry Date is extended pursuant to Section 2.10.

          "FINAL ADVANCE" means an Advance made pursuant to Section 2.2(d).

          "INTERCREDITOR  AGREEMENT" means the Intercreditor Agreement dated the
     date hereof,  among the  Trustees,  the Liquidity  Provider,  the liquidity
     provider under each Liquidity  Facility (other than this Agreement) and the
     Subordination Agent, as the same may be amended,  supplemented or otherwise
     modified from time to time in accordance with its terms.

          "INTEREST ADVANCE" means an Advance made pursuant to Section 2.2(a).

          "INTEREST  PERIOD" means,  with respect to any LIBOR Advance,  each of
     the following periods:

               (i) the period  beginning  on the third  Business  Day  following
     either (x) the Liquidity  Provider's receipt of the Notice of Borrowing for
     such  LIBOR  Advance or (y) the  withdrawal  of funds from the Class B Cash
     Collateral  Account  for the  purpose  of  paying  interest  on the Class B
     Certificates  as contemplated by Section 2.6(a) hereof and, in either case,
     ending on the next Regular Distribution Date; and

               (ii) each  subsequent  period co  mmencing on the last day of the
     immediately  preceding  Interest  Period  and  ending  on the next  Regular
     Distribution Date;

     PROVIDED,  HOWEVER,  that if (x) the Final Advance shall have been made, or
     (y) other  outstanding  Advances  shall have been  converted into the Final
     Advance, then the Interest Periods shall be successive periods of one month
     beginning on the third  Business Day  following  the  Liquidity  Provider's
     receipt of the Notice of Borrowing  for such Final  Advance (in the case of


<PAGE>

     clause  (x)  above)  or  the  Regular   Distribution  Date  following  such
     conversion (in the case of clause (y) above).

          "LENDING  OFFICE" means the lending  office of the Liquidity  Provider
     presently located at Chicago, Illinois, or such other lending office as the
     Liquidity  Provider  from time to time  shall  notify the  Borrower  as its
     lending office  hereunder;  provided that the Liquidity  Provider shall not
     change its Lending  Office to a Lending Office outside the United States of
     America except in accordance with Section 3.1, 3.2 or 3.3 hereof.

          "LIBOR ADVANCE" means an Advance bearing interest at a rate based upon
     the LIBOR Rate.

          "LIBOR RATE" means,  with respect to any Interest Period,  the average
     (rounded upward, if necessary,  to the next higher 1/16 of 1%) of the rates
     per annum at which  deposits  in dollars  are offered to major banks in the
     London  interbank  market at  approximately  11:00 A.M.  (London  time) two
     Business  Days  before the first day of such  Interest  Period in an amount
     approximately  equal to the  principal  amount of the Advance to which such
     Interest  Period is to apply and for a period  of time  comparable  to such
     Interest Period.

          "LIQUIDITY  EVENT OF DEFAULT"  means the  occurrence of either (a) the
     Acceleration of all of the Equipment Notes or (b) a Continental  Bankruptcy
     Event.

          "LIQUIDITY  INDEMNITEE"  means (i) the  Liquidity  Provider,  (ii) the
     directors,  officers,  employees and agents of the Liquidity Provider,  and
     (iii) the  successors  and  permitted  assigns of the persons  described in
     clauses (i) and (ii), inclusive.

          "LIQUIDITY  PROVIDER"  has the  meaning  assigned  to such term in the
     recital of parties to this Agreement.

          "MAXIMUM  AVAILABLE  COMMITMENT"  shall  mean,  subject to the proviso
     contained  in  the  third  sentence  of  Section  2.2(a),  at any  time  of
     determination,  (a) the  Maximum  Commitment  at  such  time  less  (b) the
     aggregate  amount  of each  Interest  Advance  outstanding  at  such  time;
     provided that following a Provider Advance or a Final Advance,  the Maximum
     Available Commitment shall be zero.

          "MAXIMUM  COMMITMENT" means, for any day, the lesser of (x) $2,113,190
     and (y) the Required Amount on such day.

          "NON-EXTENSION  ADVANCE"  means an Advance  made  pursuant  to Section
     2.2(b).

          "NOTICE OF BORROWING" has the meaning specified in Section 2.2(e).

          "NOTICE OF REPLACEMENT  SUBORDINATION AGENT" has the meaning specified
     in Section 3.8.


<PAGE>

          "PERFORMING NOTE DEFICIENCY"  means any time that less than 65% of the
     then  aggregate  outstanding  principal  amount of all Equipment  Notes are
     Performing Equipment Notes.

          "PROSPECTUS" means the Prospectus dated July 23, 1997, as modified and
     supplemented  by  the  Prospectus  Supplement  dated  September  12,  1997,
     relating to the Certificates; and as such Prospectus may be further amended
     or supplemented.

          "PROVIDER  ADVANCE"  means  a  Downgrade  Advance  or a  Non-Extension
     Advance.

          "REGULATORY  CHANGE" has the meaning  assigned to such term in Section
     3.1.

          "REPLENISHMENT  AMOUNT"  has the  meaning  assigned  to  such  term in
     Section 2.6(b).

          "REQUIRED  AMOUNT" means, for any day, the sum of the aggregate amount
     of interest,  calculated at the rate per annum equal to the Stated Interest
     Rate for the Class B  Certificates,  that  would be  payable on the Class B
     Certificates on each of the six successive  quarterly Regular  Distribution
     Dates  immediately  following  such  day  or,  if  such  day  is a  Regular
     Distribution  Date, on such day and the succeeding  five quarterly  Regular
     Distribution  Dates,  in each  case  calculated  on the  basis  of the Pool
     Balance  of the  Class B  Certificates  on such day and  without  regard to
     expected future payments of principal on the Class B Certificates.

          "ROLLS ROYCE" means Rolls-Royce plc, a corporation organized under the
     laws of England.

          "TAX  LETTER"  means the  letter  dated the date  hereof  between  the
     Liquidity Provider and Rolls Royce pertaining to this Agreement.

          "TERMINATION  DATE" means the earliest to occur of the following:  (i)
     the  Expiry  Date;  (ii) the date on which  the  Borrower  delivers  to the
     Liquidity  Provider a certificate,  signed by a Responsible  Officer of the
     Borrower, certifying that all of the Class B Certificates have been paid in
     full (or provision  has been made for such payment in  accordance  with the
     Intercreditor  Agreement  and the Trust  Agreements)  or are  otherwise  no
     longer entitled to the benefits of this Agreement;  (iii) the date on which
     the Borrower delivers to the Liquidity Provider a certificate,  signed by a
     Responsible  Officer  of  the  Borrower,   certifying  that  a  Replacement
     Liquidity Facility has been substituted for this Agreement in full pursuant
     to Section 3.6(e) of the Intercreditor  Agreement;  (iv) the fifth Business
     Day following the receipt by the Borrower of a Termination  Notice from the
     Liquidity  Provider  pursuant to Section  6.1  hereof;  and (v) the date on
     which no Advance is or may (including by reason of  reinstatement as herein
     provided) become available for a Borrowing hereunder.

          "TERMINATION NOTICE" means the Notice of Termination  substantially in
     the form of Annex V to this Agreement.


<PAGE>

          "TRANSFEREE" has the meaning assigned to such term in Section 7.8(b).

          "UNAPPLIED  DOWNGRADE  ADVANCE" means any Downgrade Advance other than
     an Applied Downgrade Advance.

          "UNAPPLIED  PROVIDER ADVANCE" means any Provider Advance other than an
     Applied Provider Advance.

          "UNPAID ADVANCE" has the meaning assigned to such term in Section 2.5.

          (b) TERMS DEFINED IN THE INTERCREDITOR  AGREEMENT. For all purposes of
this Agreement,  the following terms shall have the respective meanings assigned
to such terms in the Intercreditor Agreement:

          "Acceleration,"  "Certificates",  "Class A Cash  Collateral  Account",
          "Class A Certificates", "Class A Certificateholders", "Class A Trust",
          "Class  A  Trust   "ACCELERATION,"   "CERTIFICATES",   "CLASS  A  CASH
          COLLATERAL    ACCOUNT",    "CLASS    A    CERTIFICATES",    "CLASS   A
          CERTIFICATEHOLDERS",  "CLASS  A  TRUST",  "CLASS  A TRUST  AGREEMENT",
          "CLASS  A  TRUSTEE",  "CLASS  B CASH  COLLATERAL  ACCOUNT",  "CLASS  B
          CERTIFICATES", "CLASS B CERTIFICATEHOLDERS", "CLASS B TRUST", "CLASS B
          TRUST  AGREEMENT",   "CLASS  B  TRUSTEE",  "CLASS  C  CASH  COLLATERAL
          ACCOUNT", "CLASS C CERTIFICATES", "CLASS C CERTIFICATEHOLDERS", "CLASS
          C  TRUST",  "CLASS C TRUST  AGREEMENT",  "CLASS C  TRUSTEE",  "CLOSING
          DATE",  "CONTINENTAL",  "CONTINENTAL  BANKRUPTCY EVENT",  "CONTROLLING
          PARTY",  "CORPORATE  TRUST  OFFICE",  "DELIVERY  PERIOD  EXPIRY DATE",
          "DISTRIBUTION DATE",  "DOWNGRADED  FACILITY",  "EQUIPMENT NOTES", "FEE
          LETTER",  "FINANCING AGREEMENT",  "INDENTURE",  "INVESTMENT EARNINGS",
          "LIQUIDITY  FACILITY",   "LOAN  TRUSTEE",   "MOODY'S",   "NON-EXTENDED
          FACILITY",   "OPERATIVE  AGREEMENTS",   "PERFORMING  EQUIPMENT  NOTE",
          "PERSON",  "POOL  BALANCE",  "PURCHASE  AGREEMENT",  "RATING  AGENCY",
          "REGULAR   DISTRIBUTION  DATE",   "REPLACEMENT   LIQUIDITY  FACILITY",
          "RESPONSIBLE   OFFICER",   "SCHEDULED  PAYMENT",   "SPECIAL  PAYMENT",
          "STANDARD & POOR'S",  "STATED INTEREST RATE",  "SUBORDINATION  AGENT",
          "TAXES",   "THRESHOLD   RATING",   "TRANSFER",   "TRUST   AGREEMENTS",
          "TRUSTEE",  "UNDERWRITERS",   "UNDERWRITING  AGREEMENT"  and  "WRITTEN
          NOTICE".

                                   ARTICLE II.

                       AMOUNT AND TERMS OF THE COMMITMENT
                       ----------------------------------

          Section 2.1. THE ADVANCES.  The Liquidity  Provider hereby irrevocably
agrees,  on the terms and conditions  hereinafter set forth, to make Advances to
the  Borrower  from time to time on any  Business Day during the period from the
Effective  Date until 12:00 Noon (New York City time) on the Expiry Date (unless
the  obligations  of the  Liquidity  Provider  shall be  earlier  terminated  in
accordance with the terms of Section 2.4(b)) in an aggregate  amount at any time
outstanding not to exceed the Maximum Commitment.



<PAGE>


          Section 2.2. MAKING THE ADVANCES.

                      2.2.1.  Interest  Advances  shall  be  made in one or more
          Borrowings  by  delivery  to the  Liquidity  Provider  of one or  more
          written and completed  Notices of Borrowing in substantially  the form
          of Annex I attached  hereto,  signed by a  Responsible  Officer of the
          Borrower,  in an amount not exceeding the Maximum Available Commitment
          at such time and shall be used solely for the payment  when due of the
          interest  on the Class B  Certificates  at the  Stated  Interest  Rate
          therefor  in  accordance  with  Section  3.6(a)  of the  Intercreditor
          Agreement.  Each Interest  Advance made hereunder shall  automatically
          reduce the Maximum Available Commitment and the amount available to be
          borrowed  hereunder  by  subsequent  Advances  by the  amount  of such
          Interest  Advance  (subject to  reinstatement  as provided in the next
          sentence).  Upon  repayment to the  Liquidity  Provider in full of the
          amount of any Interest  Advance made pursuant to this Section  2.2(a),
          together  with  accrued  interest  thereon (as provided  herein),  the
          Maximum Available Commitment shall be reinstated by the amount of such
          repaid  Interest  Advance,  but not to exceed the Maximum  Commitment;
          PROVIDED,  HOWEVER, that the Maximum Available Commitment shall not be
          so  reinstated  at any time if (i) a Liquidity  Event of Default shall
          have  occurred and be continuing  and (ii) there is a Performing  Note
          Deficiency.

                      2.2.2. A  Non-Extension  Advance shall be made in a single
          Borrowing if this Agreement is not extended in accordance with Section
          3.6(d) of the Intercreditor  Agreement (unless a Replacement Liquidity
          Facility  to  replace  this  Agreement   shall  have  been  previously
          delivered to the Borrower in accordance  with said Section  3.6(d)) by
          delivery to the Liquidity  Provider of a written and completed  Notice
          of Borrowing in  substantially  the form of Annex II attached  hereto,
          signed by a Responsible Officer of the Borrower, in an amount equal to
          the Maximum  Available  Commitment at such time,  and shall be used to
          fund the  Class B Cash  Collateral  Account  in  accordance  with said
          Section 3.6(d).

                      2.2.3.  A  Downgrade  Advance  shall  be made in a  single
          Borrowing  upon a downgrading of the Liquidity  Provider's  short-term
          unsecured  debt  rating  issued  by  either  Rating  Agency  below the
          Threshold   Rating  (as  provided   for  in  Section   3.6(c)  of  the
          Intercreditor  Agreement) unless a Replacement  Liquidity  Facility to
          replace this  Agreement  shall have been  previously  delivered to the
          Borrower in accordance  with said Section  3.6(c),  by delivery to the
          Liquidity  Provider of a written and completed  Notice of Borrowing in
          substantially  the form of Annex  III  attached  hereto,  signed  by a
          Responsible Officer of the Borrower, in an amount equal to the Maximum
          Available Commitment at such time, and shall be used to fund the Class
          B Cash Collateral Account in accordance with said Section 3.6(c).

                      2.2.4. A Final Advance shall be made in a single Borrowing
          upon the  receipt by the  Borrower  of a  Termination  Notice from the


<PAGE>

          Liquidity  Provider  pursuant to Section 6.1 hereof by delivery to the
          Liquidity  Provider of a written and completed  Notice of Borrowing in
          substantially  the form of  Annex  IV  attached  hereto,  signed  by a
          Responsible Officer of the Borrower, in an amount equal to the Maximum
          Available Commitment at such time, and shall be used to fund the Class
          B Cash  Collateral  Account (in accordance  with Section 3.6(i) of the
          Intercreditor Agreement).

                      2.2.5.  Each Borrowing  shall be made on notice in writing
          (a  "NOTICE OF  BORROWING")  in  substantially  the form  required  by
          Section 2.2(a), 2.2(b), 2.2(c) or 2.2(d), as the case may be, given by
          the Borrower to the  Liquidity  Provider.  If a Notice of Borrowing is
          delivered  by the  Borrower in respect of any  Borrowing no later than
          12:00  Noon (New York City  time) on a  Business  Day,  the  Liquidity
          Provider  shall,  upon  satisfaction  of the conditions  precedent set
          forth in Section  4.2 with  respect to a requested  Borrowing,  before
          12:00  Noon  (New  York  City  time) on the  first  Business  Day next
          following  the day of receipt of such Notice of  Borrowing  or on such
          later  Business  Day  specified  in such  Notice  of  Borrowing,  make
          available   to  the   Borrower,   in   accordance   with  its  payment
          instructions,  in U.S.  dollars and immediately  available  funds, the
          amount of such Borrowing. If a Notice of Borrowing is delivered by the
          Borrower in respect of any  Borrowing  after 12:00 Noon (New York City
          time)  on  a  Business  Day,  the  Liquidity   Provider  shall,   upon
          satisfaction of the conditions precedent set forth in Section 4.2 with
          respect to a  requested  Borrowing,  before  12:00 Noon (New York City
          time) on the second  Business Day next following the day of receipt of
          such Notice of  Borrowing or on such later  Business Day  specified by
          the  Borrower  in such  Notice of  Borrowing,  make  available  to the
          Borrower, in accordance with its payment instructions, in U.S. dollars
          and in  immediately  available  funds,  the amount of such  Borrowing.
          Payments of proceeds of a Borrowing  shall be made by wire transfer of
          immediately  available  funds to the Borrower in accordance  with such
          wire transfer  instructions as the Borrower shall furnish from time to
          time to the  Liquidity  Provider  for such  purpose.  Each  Notice  of
          Borrowing shall be irrevocable and binding on the Borrower.

                      2.2.6. Upon the making of any Advance  requested  pursuant
          to a Notice of Borrowing,  in accordance  with the Borrower's  payment
          instructions,  the Liquidity Provider shall be fully discharged of its
          obligation hereunder with respect to such Notice of Borrowing, and the
          Liquidity  Provider  shall not  thereafter  be  obligated  to make any
          further  Advances  hereunder in respect of such Notice of Borrowing to
          the  Borrower  or to any other  Person.  Following  the  making of any
          Advance  pursuant  to  Section  2.2(b),  (c) or (d) hereof to fund the
          Class B Cash Collateral Account,  the Liquidity Provider shall have no
          interest  in or rights to the Class B Cash  Collateral  Account,  such
          Advance or any other amounts from time to time on deposit in the Class
          B Cash  Collateral  Account;  provided  that the  foregoing  shall not
          affect or impair the  obligations of the  Subordination  Agent to make
          the  distributions  contemplated  by  Section  3.6(e)  or  (f)  of the
          Intercreditor  Agreement.  By  paying  to  the  Borrower  proceeds  of


<PAGE>

          Advances  requested by the Borrower in accordance  with the provisions
          of this Agreement,  the Liquidity  Provider makes no representation as
          to, and assumes no responsibility  for, the correctness or sufficiency
          for any purpose of the amount of the Advances so made and requested.

          Section 2.3. FEES.  Borrower  agrees to pay to the Liquidity  Provider
the fees set forth in the Fee Letter.

          Section 2.4. ADJUSTMENTS OR TERMINATION OF THE MAXIMUM COMMITMENT.

                      2.4.1. AUTOMATIC ADJUSTMENTS. Promptly following each date
          on which the Required  Amount is reduced as a result of a reduction in
          the Pool Balance of the Class B Certificates or otherwise,  clause (y)
          of the definition of Maximum Commitment shall automatically be reduced
          to an  amount  equal to the  Required  Amount  (as  calculated  by the
          Borrower).  The  Borrower  shall  give  notice  of any such  automatic
          reduction of the Maximum  Commitment to the Liquidity  Provider within
          two Business Days thereof.  The failure by the Borrower to furnish any
          such notice shall not affect such  automatic  reduction of the Maximum
          Commitment.

                      2.4.2.  TERMINATION.  Upon  the  making  of  any  Provider
          Advance  or  Final  Advance   hereunder  or  the   occurrence  of  the
          Termination  Date,  the  obligation of the Liquidity  Provider to make
          further  Advances   hereunder  shall   automatically  and  irrevocably
          terminate,  and the  Borrower  shall not be  entitled  to request  any
          further Borrowing hereunder.

          Section 2.5.  REPAYMENTS  OF INTEREST  ADVANCES OR THE FINAL  ADVANCE.
Subject to Sections 2.6, 2.7 and 2.9 hereof, the Borrower hereby agrees, without
notice of an Advance or demand for repayment from the Liquidity  Provider (which
notice and demand are hereby waived by the Borrower),  to pay, or to cause to be
paid,  to the Liquidity  Provider on each date on which the  Liquidity  Provider
shall make an Interest Advance or the Final Advance,  an amount equal to (a) the
amount of such Advance (any such Advance, until repaid, is referred to herein as
an  "UNPAID  ADVANCE"),  plus (b)  interest  on the  amount of each such  Unpaid
Advance as provided in Section 3.7 hereof;  PROVIDED  that if (i) the  Liquidity
Provider  shall  make a Provider  Advance  at any time after  making one or more
Interest  Advances  which  shall not have been  repaid in  accordance  with this
Section 2.5 or (ii) this Liquidity  Facility shall become a Downgraded  Facility
or Non-Extended  Facility at any time when  unreimbursed  Interest Advances have
reduced the Maximum  Available  Commitment to zero, then such Interest  Advances
shall  cease to  constitute  Unpaid  Advances  and  shall be deemed to have been
changed into an Applied Downgrade Advance or an Applied  Non-Extension  Advance,
as the case may be,  for all  purposes  of this  Agreement  (including,  without
limitation,  for the  purpose  of  determining  when such  Interest  Advance  is
required to be repaid to the Liquidity  Provider in accordance  with Section 2.6
and for the purposes of Section 2.6(b)). The Borrower and the Liquidity Provider
agree that the repayment in full of each  Interest  Advance and Final Advance on


<PAGE>

the date such Advance is made is intended to be a  contemporaneous  exchange for
new value given to the Borrower by the Liquidity Provider.

          Section 2.6. REPAYMENTS OF PROVIDER ADVANCES.

                      2.6.1. Amounts advanced hereunder in respect of a Provider
          Advance  shall be  deposited in the Class B Cash  Collateral  Account,
          invested and withdrawn from the Class B Cash Collateral Account as set
          forth in Sections 3.6(c), (d) and (f) of the Intercreditor  Agreement.
          The Borrower agrees to pay to the Liquidity Provider,  on each Regular
          Distribution Date,  commencing on the first Regular  Distribution Date
          after the  making of a Provider  Advance,  interest  on the  principal
          amount of any such  Provider  Advance  as  provided  in  Section  3.7;
          PROVIDED,  HOWEVER,  that  amounts in  respect  of a Provider  Advance
          withdrawn from the Class B Cash Collateral  Account for the purpose of
          paying interest on the Class B Certificates in accordance with Section
          3.6(f)  of  the  Intercreditor  Agreement  (the  amount  of  any  such
          withdrawal being (y) in the case of a Downgrade  Advance,  an "APPLIED
          DOWNGRADE ADVANCE" and (z) in the case of a Non-Extension  Advance, an
          "APPLIED   NON-EXTENSION   ADVANCE"  and,  together  with  an  Applied
          Downgrade  Advance,  an "APPLIED  PROVIDER  ADVANCE") shall thereafter
          (subject to Section  2.6(b)) be treated as an Interest  Advance  under
          this  Agreement for purposes of determining  the Applicable  Liquidity
          Rate for interest payable thereon; PROVIDED FURTHER, HOWEVER, that if,
          following the making of a Provider  Advance,  the  Liquidity  Provider
          delivers a Termination  Notice to the Borrower pursuant to Section 6.1
          hereof,  such Provider  Advance shall thereafter be treated as a Final
          Advance  under  this  Agreement  for  purposes  of   determining   the
          Applicable  Liquidity Rate for interest  payable  thereon.  Subject to
          Sections 2.7 and 2.9 hereof,  immediately  upon the  withdrawal of any
          amounts  from the Class B Cash  Collateral  Account  on  account  of a
          reduction in the  Required  Amount,  the  Borrower  shall repay to the
          Liquidity  Provider a portion of the Provider  Advances in a principal
          amount  equal to the amount of such  reduction,  plus  interest on the
          principal amount prepaid as provided in Section 3.7 hereof.

                      2.6.2.  At any time when an Applied  Provider  Advance (or
          any portion  thereof) is outstanding,  upon the deposit in the Class B
          Cash  Collateral  Account of any amount  pursuant to clause "THIRD" of
          Section  2.4(b) of the  Intercreditor  Agreement,  clause  "THIRD"  of
          Section  3.2 of the  Intercreditor  Agreement  or clause  "FOURTH"  of
          Section 3.3 of the  Intercreditor  Agreement  (any such amount being a
          "REPLENISHMENT  AMOUNT") for the purpose of replenishing or increasing
          the balance  thereof up to the Required  Amount at such time,  (i) the
          aggregate   outstanding  principal  amount  of  all  Applied  Provider
          Advances (and of Provider  Advances treated as an Interest Advance for
          purposes of  determining  the  Applicable  Liquidity Rate for interest
          payable thereon) shall be automatically  reduced by the amount of such
          Replenishment  Amount  and (ii) the  aggregate  outstanding  principal
          amount  of all  Unapplied  Provider  Advances  shall be  automatically
          increased by the amount of such Replenishment Amount.


<PAGE>

                      2.6.3.  Upon  the  provision  of a  Replacement  Liquidity
          Facility in replacement  of this Agreement in accordance  with Section
          3.6(e) of the Intercreditor Agreement, amounts remaining on deposit in
          the Class B Cash Collateral Account after giving effect to any Applied
          Provider Advance on the date of such  replacement  shall be reimbursed
          to the  Liquidity  Provider,  but only to the extent such  amounts are
          necessary to repay in full to the Liquidity Provider all amounts owing
          to it hereunder.

          Section   2.7.   PAYMENTS  TO  THE   LIQUIDITY   PROVIDER   UNDER  THE
INTERCREDITOR  AGREEMENT.  In order to provide for payment or  repayment  to the
Liquidity  Provider  of  any  amounts  hereunder,  the  Intercreditor  Agreement
provides  that amounts  available  and referred to in Articles II and III of the
Intercreditor  Agreement,  to  the  extent  payable  to the  Liquidity  Provider
pursuant  to  the  terms  of the  Intercreditor  Agreement  (including,  without
limitation, Section 3.6(f) of the Intercreditor Agreement), shall be paid to the
Liquidity Provider in accordance with the terms thereof.  Amounts so paid to the
Liquidity  Provider  shall be applied by the  Liquidity  Provider  to  Liquidity
Obligations then due and payable in accordance with the Intercreditor  Agreement
or, if not provided for in the Intercreditor  Agreement,  then in such manner as
the Liquidity Provider shall deem appropriate.

          Section 2.8. BOOK ENTRIES.  The Liquidity  Provider  shall maintain in
accordance  with its usual  practice  an  account  or  accounts  evidencing  the
indebtedness of the Borrower  resulting from Advances made from time to time and
the amounts of principal  and interest  payable  hereunder and paid from time to
time in respect thereof;  PROVIDED,  HOWEVER,  that the failure by the Liquidity
Provider to maintain such account or accounts  shall not affect the  obligations
of the Borrower in respect of Advances.

          Section 2.9.  PAYMENTS FROM  AVAILABLE  FUNDS ONLY. All payments to be
made by the Borrower  under this  Agreement  shall be made only from the amounts
that constitute  Scheduled Payments,  Special Payments or payments under Section
9.1 of the  Participation  Agreements  and only to the extent that the  Borrower
shall have  sufficient  income or proceeds  therefrom  to enable the Borrower to
make  payments in  accordance  with the terms hereof after giving  effect to the
priority of payments  provisions set forth in the Intercreditor  Agreement.  The
Liquidity Provider agrees that it will look solely to such amounts to the extent
available for distribution to it as provided in the Intercreditor  Agreement and
this  Agreement  and that  the  Borrower,  in its  individual  capacity,  is not
personally  liable  to it for  any  amounts  payable  or  liability  under  this
Agreement  except as expressly  provided in this  Agreement,  the  Intercreditor
Agreement or any Participation Agreement. Amounts on deposit in the Class B Cash
Collateral  Account  shall be available to the Borrower to make  payments  under
this Agreement only to the extent and for the purposes expressly contemplated in
Section 3.6(f) of the Intercreditor Agreement.

          Section 2.10. EXTENSION OF THE EXPIRY DATE;  NON-EXTENSION ADVANCE. No
earlier  than  the 60th  day and no  later  than the 40th day  prior to the then
effective  Expiry Date  (unless such Expiry Date is on or after the date that is
15 days  after  the  Final  Maturity  Date for the  Class B  Certificates),  the
Borrower shall request that the Liquidity  Provider extend the Expiry Date for a


<PAGE>

period of 364 days after the then effective  Expiry Date (unless the obligations
of the Liquidity  Provider are earlier  terminated in accordance  with the terms
hereof).  The Liquidity  Provider shall advise the Borrower,  no earlier than 40
days and no later than 25 days prior to the then effective Expiry Date, whether,
in its sole discretion, it agrees to so extend the Expiry Date. If the Liquidity
Provider advises the Borrower on or before the 25th day prior to the Expiry Date
then in effect  that such  Expiry  Date  shall not be so  extended,  or fails to
irrevocably  and  unconditionally  advise the Borrower on or before the 25th day
prior to the  Expiry  Date then in  effect  that such  Expiry  Date  shall be so
extended  (and,  in each case,  if the  Liquidity  Provider  shall not have been
replaced in accordance with Section 3.6(e) of the Intercreditor Agreement),  the
Borrower  shall be  entitled  on and after  such 25th day (but prior to the then
effective  Expiry Date) to request a  Non-Extension  Advance in accordance  with
Section 2.2(b) hereof and Section 3.6(d) of the Intercreditor Agreement.

                                  ARTICLE III.

                           OBLIGATIONS OF THE BORROWER
                           ---------------------------

          Section 3.1. INCREASED COSTS.  Subject to the Fee Letter, the Borrower
shall pay to the  Liquidity  Provider  from time to time such  amounts as may be
necessary to compensate the Liquidity  Provider for any increased costs incurred
by the Liquidity  Provider which are  attributable  to its making or maintaining
any  LIBOR  Advances  hereunder  or its  obligation  to make any  such  Advances
hereunder,  or any reduction in any amount receivable by the Liquidity  Provider
under  this  Agreement  or the  Intercreditor  Agreement  in respect of any such
Advances or such  obligation  (such increases in costs and reductions in amounts
receivable being herein called  "ADDITIONAL  COSTS"),  resulting from any change
after the date of this Agreement in U.S. federal,  state,  municipal, or foreign
laws or  regulations  (including  Regulation D), or the adoption or making after
the date of this Agreement of any interpretations,  directives,  or requirements
applying to a class of banks  including  the Liquidity  Provider  under any U.S.
federal,  state,  municipal,  or any foreign laws or regulations (whether or not
having  the  force of law) by any  court,  central  bank or  monetary  authority
charged  with  the  interpretation  or  administration  thereof  (a  "REGULATORY
CHANGE"), which: (1) changes the basis of taxation of any amounts payable to the
Liquidity  Provider under this Agreement in respect of any such Advances  (other
than Excluded Taxes);  or (2) imposes or modifies any reserve,  special deposit,
compulsory loan or similar requirements  relating to any extensions of credit or
other  assets of, or any  deposits  with  other  liabilities  of, the  Liquidity
Provider  (including  any  such  Advances  or any  deposits  referred  to in the
definition of LIBOR Rate or related definitions).  The Liquidity Provider agrees
to use  reasonable  efforts  (consistent  with  applicable  legal and regulatory
restrictions)  to change the  jurisdiction  of its Lending Office if making such
change  would  avoid the need for,  or reduce the amount of, any amount  payable
under  this  Section  3.1 that may  thereafter  accrue  and  would  not,  in the
reasonable judgment of the Liquidity Provider,  be otherwise  disadvantageous to
the Liquidity Provider.

          The Liquidity Provider will notify the Borrower of any event occurring
after the date of this  Agreement  that will entitle the  Liquidity  Provider to
compensation  pursuant to this Section 3.1 as promptly as  practicable  after it


<PAGE>

obtains  knowledge  thereof and determines to request such  compensation,  which
notice shall describe in reasonable  detail the  calculation of the amounts owed
under this Section.  Determinations  by the  Liquidity  Provider for purposes of
this Section 3.1 of the effect of any  Regulatory  Change on its costs of making
or maintaining  Advances or on amounts  receivable by it in respect of Advances,
and of the additional  amounts required to compensate the Liquidity  Provider in
respect of any  Additional  Costs,  shall be prima facie  evidence of the amount
owed under this Section.

          Section 3.2. CAPITAL  ADEQUACY.  Subject to the Fee Letter, if (1) the
adoption,  after the date hereof,  of any applicable  governmental  law, rule or
regulation regarding capital adequacy, (2) any change, after the date hereof, in
the  interpretation or administration of any such law, rule or regulation by any
central bank or other governmental  authority charged with the interpretation or
administration  thereof  or (3)  compliance  by the  Liquidity  Provider  or any
corporation  controlling the Liquidity Provider with any applicable guideline or
request of general  applicability,  issued after the date hereof, by any central
bank or other  governmental  authority  (whether or not having the force of law)
that  constitutes a change of the nature described in clause (2), has the effect
of requiring an increase in the amount of capital  required to be  maintained by
the Liquidity  Provider or any corporation  controlling the Liquidity  Provider,
and such increase is based upon the Liquidity Provider's  obligations  hereunder
and other similar obligations,  the Borrower shall pay to the Liquidity Provider
from  time to time  such  additional  amount  or  amounts  as are  necessary  to
compensate the Liquidity  Provider for such portion of such increase as shall be
reasonably  allocable to the Liquidity  Provider's  obligations  to the Borrower
hereunder.  The Liquidity Provider agrees to use reasonable efforts  (consistent
with applicable legal and regulatory restrictions) to change the jurisdiction of
its Lending Office if making such change would avoid the need for, or reduce the
amount of, any amount payable under this Section that may thereafter  accrue and
would not, in the reasonable  judgment of the Liquidity  Provider,  be otherwise
materially disadvantageous to the Liquidity Provider.

          The Liquidity Provider will notify the Borrower of any event occurring
after the date of this  Agreement  that will entitle the  Liquidity  Provider to
compensation  pursuant to this Section 3.2 as promptly as  practicable  after it
obtains  knowledge  thereof and determines to request such  compensation,  which
notice shall describe in reasonable  detail the  calculation of the amounts owed
under this Section.  Determinations  by the  Liquidity  Provider for purposes of
this Section 3.2 of the effect of any increase in the amount of capital required
to be  maintained  by the  bank and of the  amount  allocable  to the  Liquidity
Provider's  obligations to the Borrower  hereunder shall be prima facie evidence
of the amounts owed under this Section.

          Section 3.3.  PAYMENTS  FREE OF  DEDUCTIONS.  All payments made by the
Borrower  under  this  Agreement  shall be made free and clear of,  and  without
reduction  for or on account  of, any  present or future  stamp or other  taxes,
levies, imposts, duties, charges, fees, deductions,  withholdings,  restrictions
or  conditions  of any  nature  whatsoever  now or  hereafter  imposed,  levied,
collected,  withheld or assessed,  excluding  Excluded Taxes (such  non-excluded
taxes  being  referred to herein,  collectively,  as  "Non-Excluded  Taxes" and,
individually,  as a "Non-Excluded  Tax"). If any Non-Excluded Taxes are required
to be withheld  from any amounts  payable to the Liquidity  Provider  under this
Agreement,  the amounts so payable to the Liquidity  Provider shall be increased


<PAGE>

to the extent necessary to yield to the Liquidity Provider (after payment of all
Non-Excluded  Taxes)  interest  or any other  such  amounts  payable  under this
Agreement  at the  rates or in the  amounts  specified  in this  Agreement.  The
Liquidity  Provider  agrees  to use  reasonable  efforts  (consistent  with  its
internal   policy  and  legal  and  regulatory   restrictions)   to  change  the
jurisdiction  of its Lending  Office if making such change  would avoid the need
for, or reduce the amount of, any such  additional  amounts that may  thereafter
accrue and would not, in the reasonable judgment of the Liquidity  Provider,  be
otherwise  disadvantageous to the Liquidity Provider. From time to time upon the
reasonable request of the Borrower,  the Liquidity Provider agrees to provide to
the  Borrower two  original  Internal  Revenue  Service  Forms 1001 or 4224,  as
appropriate,  or any successor or other form prescribed by the Internal  Revenue
Service,  certifying that the Liquidity Provider is exempt from or entitled to a
reduced  rate of United  States  withholding  tax on  payments  pursuant to this
Agreement.

          Section 3.4.  PAYMENTS.  The  Borrower  shall make or cause to be made
each payment to the Liquidity  Provider  under this Agreement so as to cause the
same to be received by the Liquidity Provider not later than 1:00 P.M. (New York
City time) on the day when due.  The  Borrower  shall make all such  payments in
lawful  money of the United  States of  America,  to the  Liquidity  Provider in
immediately  available  funds, by wire transfer to ABN AMRO Bank N.V., New York,
NY, ABA # 026009580, Account Name: ABN AMRO Bank, N.V. - Chicago Branch, Account
#  650-001-1789-41,  Reference:  Continental  Airlines,  Inc. Pass Through Trust
1997-3B .

          Section 3.5.  COMPUTATIONS.  All computations of interest based on the
Base Rate  shall be made on the basis of a year of 365 or 366 days,  as the case
may be, and all  computations  of interest based on the LIBOR Rate shall be made
on the basis of a year of 360 days,  in each case for the actual  number of days
(including the first day but excluding the last day) occurring in the period for
which such interest is payable.

          Section 3.6. PAYMENT ON NON-BUSINESS DAYS.  Whenever any payment to be
made  hereunder  shall be stated to be due on a day other than a  Business  Day,
such payment shall be made on the next succeeding Business Day and no additional
interest shall be due as a result (and if so made,  shall be deemed to have been
made when  due).  If any  payment in  respect  of  interest  on an Advance is so
deferred to the next succeeding  Business Day, such deferral shall not delay the
commencement  of the next Interest  Period for such Advance or reduce the number
of days for which  interest will be payable on such Advance on the next interest
payment date for such Advance.

          Section 3.7. INTEREST.

                      3.7.1.  Subject to Section 2.9, the Borrower shall pay, or
          shall  cause  to be paid,  without  duplication,  interest  on (i) the
          unpaid principal amount of each Advance from and including the date of
          such Advance (or, in the case of an Applied Provider Advance, from and
          including the date on which the amount  thereof was withdrawn from the
          Class  B Cash  Collateral  Account  to pay  interest  on the  Class  B
          Certificates) to but excluding the date such principal amount shall be
          paid in full (or, in the case of an Applied Provider Advance, the date


<PAGE>

          on which the Class B Cash Collateral  Account is fully  replenished in
          respect  of such  Advance)  and (ii) any other  amount  due  hereunder
          (whether  fees,  commissions,  expenses  or other  amounts  or, to the
          extent  permitted by law,  installments of interest on Advances or any
          such  other  amount)  which is not paid  when due  (whether  at stated
          maturity,  by  acceleration  or otherwise)  from and including the due
          date thereof to but excluding the date such amount is paid in full, in
          each such case, at a fluctuating  interest rate per annum for each day
          equal to the  Applicable  Liquidity  Rate (as defined  below) for such
          Advance  or such  other  amount as in effect  for such day,  but in no
          event at a rate per annum  greater than the maximum rate  permitted by
          applicable law; PROVIDED,  HOWEVER, that, if at any time the otherwise
          applicable interest rate as set forth in this Section 3.7 shall exceed
          the maximum rate  permitted by  applicable  law,  then any  subsequent
          reduction in such  interest  rate will not reduce the rate of interest
          payable  pursuant to this Section 3.7 below the maximum rate permitted
          by applicable  law until the total amount of interest  accrued  equals
          the  amount of  interest  that would  have  accrued if such  otherwise
          applicable  interest  rate as set forth in this Section 3.7 had at all
          times been in effect.

                      3.7.2.  Except as  provided  in  clause  (e)  below,  each
          Advance  will be  either a Base Rate  Advance  or a LIBOR  Advance  as
          provided in this Section. Each Advance will be a Base Rate Advance for
          the period from the date of its borrowing to (but excluding) the third
          Business Day following the Liquidity  Provider's receipt of the Notice
          of Borrowing  for such  Advance.  Thereafter,  such Advance shall be a
          LIBOR  Advance;  provided  that the Borrower (at the  direction of the
          Controlling  Party,  so  long  as the  Liquidity  Provider  is not the
          Controlling  Party) may (x) convert the Final Advance into a Base Rate
          Advance  on the last day of an  Interest  Period  for such  Advance by
          giving the Liquidity  Provider no less than four Business  Days' prior
          written  notice of such  election or (y) elect to  maintain  the Final
          Advance as Base Rate Advance by not  requesting  a  conversion  of the
          Final Advance to a LIBOR  Advance  under Clause (5) of the  applicable
          Notice of Borrowing.

                      3.7.3.  Each LIBOR Advance shall bear interest during each
          Interest  Period at a rate per annum  equal to the LIBOR Rate for such
          Interest  Period plus the  Applicable  Margin for such LIBOR  Advance,
          payable in arrears on the last day of such Interest Period and, in the
          event of the payment of principal of such LIBOR Advance on a day other
          than such  last day,  on the date of such  payment  (to the  extent of
          interest accrued on the amount of principal repaid).

                      3.7.4.  Each Base Rate  Advance  shall bear  interest at a
          rate per annum equal to the Base Rate plus the  Applicable  Margin for
          such  Base  Rate   Advance,   payable  in  arrears  on  each   Regular
          Distribution  Date and,  in the event of the payment of  principal  of


<PAGE>

          such Base Rate  Advance  on a day  other  than a Regular  Distribution
          Date,  on the date of such payment (to the extent of interest  accrued
          on the amount of principal repaid).

                      3.7.5.  Each  Unapplied  Provider  Advance  (i) during the
          period  from and  including  the date of the making of such  Unapplied
          Provider  Advance through but excluding the date of repayment  thereof
          or of  conversion  thereof  into a Final  Advance or Applied  Provider
          Advance  (and for any  additional  periods of time  during  which such
          Advance no longer  constitutes an Applied  Provider  Advance but again
          constitutes an Unapplied  Provider Advance pursuant to Sections 2.6(a)
          and (b)  hereof),  shall  bear  interest  in an  amount  equal  to the
          Investment  Earnings  on  amounts  on  deposit  in  the  Class  B Cash
          Collateral  Account for such period plus the Applicable  Margin on the
          amount of such  Unapplied  Provider  Advance  from time to time during
          such period,  payable in arrears on each Regular Distribution Date and
          (ii) after conversion thereof into a Final Advance or Applied Provider
          Advance  (but only for such period of time during  which such  Advance
          constitutes an Applied  Provider  Advance  pursuant to Sections 2.6(a)
          and (b)  hereof),  as the case may be,  shall be a LIBOR  Advance  and
          shall bear interest in accordance with clause (c) above.

                      3.7.6.  Each amount not paid when due  hereunder  (whether
          fees,  commissions,  expenses  or  other  amounts  or,  to the  extent
          permitted by applicable law,  installments of interest on Advances but
          excluding  Advances)  shall bear interest at a rate per annum equal to
          the Base Rate plus 2.00% until paid.

                      3.7.7. Each change in the Base Rate shall become effective
          immediately.  The rates of interest specified in this Section 3.7 with
          respect to any  Advance or other  amount  shall be  referred to as the
          "APPLICABLE LIQUIDITY RATE".

          Section 3.8. REPLACEMENT OF BORROWER. From time to time and subject to
the  successor  Borrower's  meeting the  eligibility  requirements  set forth in
Section 6.9 of the Intercreditor Agreement applicable to the Subordination Agent
upon the effective date and time specified in a written and completed  Notice of
Replacement  Subordination  Agent in substantially the form of Annex VI attached
hereto  (a  "NOTICE  OF  REPLACEMENT  SUBORDINATION  AGENT")  delivered  to  the
Liquidity  Provider by the then  Borrower,  the  successor  Borrower  designated
therein shall be substituted for as the Borrower for all purposes hereunder.

          Section 3.9. FUNDING LOSS  INDEMNIFICATION.  The Borrower shall pay to
the Liquidity Provider,  upon the request of the Liquidity Provider, such amount
or amounts as shall be sufficient  (in the  reasonable  opinion of the Liquidity
Provider) to compensate it for any loss,  cost, or expense incurred by reason of
the  liquidation  or  redeployment  of deposits  or other funds  acquired by the
Liquidity  Provider to fund or maintain any LIBOR Advance (but excluding loss of
anticipated profits) incurred as a result of:

          (a) Any repayment of a LIBOR Advance on a date other than the last day
of the Interest Period for such Advance; or


<PAGE>

          (b) Any failure by the Borrower to borrow a LIBOR  Advance on the date
for borrowing specified in the relevant notice under Section 2.2.

          Section 3.10. ILLEGALITY.  Notwithstanding any other provision in this
Agreement,  if any change in any  applicable  law,  rule or  regulation,  or any
change in the  interpretation  or  administration  thereof  by any  governmental
authority,  central bank or comparable agency charged with the interpretation or
administration  thereof, or compliance by the Liquidity Provider (or its Lending
Office) with any request or  directive  (whether or not having the force of law)
of any such authority,  central bank or comparable agency shall make it unlawful
or impossible for the Liquidity  Provider (or its Lending Office) to maintain or
fund its LIBOR  Advances,  then upon  notice to the  Borrower  by the  Liquidity
Provider,  the  outstanding  principal  amount  of the LIBOR  Advances  shall be
converted to Base Rate  Advances (a)  immediately  upon demand of the  Liquidity
Provider, if such change or compliance with such request, in the judgment of the
Liquidity Provider,  requires immediate  repayment;  or (b) at the expiration of
the last Interest  Period to expire before the effective date of any such change
or request.

                                   ARTICLE IV.

                              CONDITIONS PRECEDENT
                              --------------------

          Section 4.1.  CONDITIONS  PRECEDENT TO  EFFECTIVENESS OF SECTION 2.1..
Section 2.1 of this Agreement shall become effective on and as of the first date
(the  "EFFECTIVE  DATE") on which the following  conditions  precedent have been
satisfied or waived:

                      4.1.1.  The Liquidity  Provider  shall have received on or
          before the Closing Date each of the following, and in the case of each
          document delivered pursuant to paragraphs (i), (ii) and (iii), each in
          form and substance satisfactory to the Liquidity Provider:

                            (i) This Agreement  duly  executed  on behalf of the
                    Borrower;

                           (ii) The  Intercreditor  Agreement  duly  executed on
                    behalf of each of the parties thereto;

                          (iii) Fully  executed  copies of each of the Operative
                    Agreements  executed and  delivered on or before the Closing
                    Date  (other  than  this  Agreement  and  the  Intercreditor
                    Agreement);

                           (iv) A copy of the Prospectus and specimen  copies of
                    the Class B Certificates;

                            (v) An executed  copy of each  document, instrument,
                    certificate  and opinion  delivered on or before the Closing
                    Date   pursuant  to  the  Class  B  Trust   Agreement,   the
                    Intercreditor  Agreement and the other Operative  Agreements
                    (together with, in the case of each such opinion, other than


<PAGE>

                    the opinion of counsel for the  Underwriters,  a letter from
                    the counsel  rendering  such  opinion to the effect that the
                    Liquidity Provider is entitled to rely on such opinion as of
                    its date as if it were addressed to the Liquidity Provider);

                           (vi)  Evidence  that  there  shall have been made and
                    shall be in full force and effect,  all filings,  recordings
                    and/or  registrations,  and there  shall  have been given or
                    taken  any  notice  or  other  similar   action  as  may  be
                    reasonably  necessary or, to the extent reasonably requested
                    by the Liquidity Provider, reasonably advisable, in order to
                    establish,  perfect,  protect and preserve the right,  title
                    and  interest,   remedies,  powers,  privileges,  liens  and
                    security  interests of, or for the benefit of, the Trustees,
                    the  Borrower  and the  Liquidity  Provider  created  by the
                    Operative  Agreements  executed and delivered on or prior to
                    the Closing Date;

                          (vii)  An  agreement  from  Continental,  pursuant  to
                    which (i) Continental  agrees to provide copies of quarterly
                    financial statements and audited annual financial statements
                    to the Liquidity Provider, and such other information as the
                    Liquidity  Provider shall reasonably request with respect to
                    the transactions  contemplated by the Operative  Agreements,
                    in  each  case,  only  to the  extent  that  Continental  is
                    obligated  to provide such  information  pursuant to Section
                    8.2.1  of  the  Leases  to  the  parties  thereto  and  (ii)
                    Continental  agrees  to  allow  the  Liquidity  Provider  to
                    inspect  Continental's  books  and  records  regarding  such
                    transactions, and to discuss such transactions with officers
                    and employees of Continental; and

                         (viii)  Such  other  documents,  instruments,  opinions
                    and   approvals  as  the  Liquidity   Provider   shall  have
                    reasonably requested.

                      4.1.2. The following  statement shall be true on and as of
          the Effective Date: no event has occurred and is continuing,  or would
          result from the entering  into of this  Agreement or the making of any
          Advance, which constitutes a Liquidity Event of Default.

                      4.1.3. The Liquidity  Provider shall have received payment
          in full of all fees and other sums  required  to be paid to or for the
          account of the Liquidity Provider on or prior to the Effective Date.

                      4.1.4.  All  conditions  precedent  to the issuance of the
          Certificates under the Trust Agreements shall have been satisfied, all
          conditions  precedent  to the  effectiveness  of the  other  Liquidity
          Facilities shall have been satisfied,  and all conditions precedent to
          the  purchase  of the  Certificates  by  the  Underwriters  under  the
          Underwriting  Agreement shall have been satisfied  (unless any of such
          conditions precedent shall have been waived by the Underwriters).


<PAGE>

                      4.1.5.  The Borrower  shall have  received a  certificate,
          dated the date hereof,  signed by a duly authorized  representative of
          the Liquidity  Provider,  certifying that all conditions  precedent to
          the effectiveness of Section 2.1 have been satisfied or waived.

          Section 4.2. CONDITIONS PRECEDENT TO BORROWING.  The obligation of the
Liquidity Provider to make an Advance on the occasion of each Borrowing shall be
subject to the conditions  precedent that the Effective Date shall have occurred
and,  prior to the date of such  Borrowing,  the Borrower shall have delivered a
Notice of Borrowing which conforms to the terms and conditions of this Agreement
and has been  completed as may be required by the relevant form of the Notice of
Borrowing for the type of Advances requested.

                                   ARTICLE V.

                                    COVENANTS
                                    ---------

          Section 5.1.  AFFIRMATIVE  COVENANTS OF THE  BORROWER.  So long as any
Advance  shall remain unpaid or the  Liquidity  Provider  shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount
to the Liquidity  Provider  hereunder,  the Borrower will,  unless the Liquidity
Provider shall otherwise consent in writing:

                      5.1.1.   PERFORMANCE   OF  THIS  AND   OTHER   AGREEMENTS.
          Punctually  pay or cause to be paid all  amounts  payable  by it under
          this  Agreement  and the other  Operative  Agreements  and observe and
          perform  in  all  material  respects  the  conditions,  covenants  and
          requirements  applicable  to it  contained in this  Agreement  and the
          other Operative Agreements.

                      5.1.2.  REPORTING  REQUIREMENTS.  Furnish to the Liquidity
          Provider with reasonable  promptness,  such other information and data
          with  respect  to  the  transactions  contemplated  by  the  Operative
          Agreements  as from time to time may be  reasonably  requested  by the
          Liquidity Provider; and permit the Liquidity Provider, upon reasonable
          notice,  to inspect the  Borrower's  books and records with respect to
          such  transactions  and to meet with  officers  and  employees  of the
          Borrower to discuss such transactions.

                      5.1.3.  CERTAIN  OPERATIVE  AGREEMENTS.   Furnish  to  the
          Liquidity   Provider  with  reasonable   promptness,   such  Operative
          Agreements entered into after the date hereof as from time to time may
          be reasonably requested by the Liquidity Provider.

          Section  5.2.  NEGATIVE  COVENANTS  OF THE  BORROWER.  So  long as any
Advance  shall remain unpaid or the  Liquidity  Provider  shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount
to the Liquidity Provider hereunder,  the Borrower will not appoint or permit or
suffer to be appointed any successor Borrower without the written consent of the
Liquidity Provider, which consent shall not be unreasonably withheld or delayed.


<PAGE>

                                   ARTICLE VI.

                          LIQUIDITY EVENTS OF DEFAULT
                          ---------------------------

          Section 6.1.  LIQUIDITY EVENTS OF DEFAULT.  If (a) any Liquidity Event
of Default has occurred  and is  continuing  and (b) there is a Performing  Note
Deficiency,  the  Liquidity  Provider  may,  in its  discretion,  deliver to the
Borrower a  Termination  Notice,  the effect of which shall be to cause (i) this
Agreement  to  expire  on the fifth  Business  Day after the date on which  such
Termination  Notice is received by the  Borrower,  (ii) the Borrower to promptly
request,  and the  Liquidity  Provider  to  promptly  make,  a Final  Advance in
accordance  with Section 2.2(d) hereof and Section  3.6(i) of the  Intercreditor
Agreement,  (iii) all other outstanding  Advances to be automatically  converted
into Final  Advances for purposes of determining  the Applicable  Liquidity Rate
for interest payable  thereon,  and (iv) subject to Sections 2.7 and 2.9 hereof,
all Advances  (including,  without limitation,  any Provider Advance and Applied
Provider   Advance),   any  accrued  interest  thereon  and  any  other  amounts
outstanding  hereunder to become  immediately  due and payable to the  Liquidity
Provider.

                                  ARTICLE VII.

                                  MISCELLANEOUS
                                  -------------

          Section 7.1. AMENDMENTS,  ETC. No amendment or waiver of any provision
of this Agreement, nor consent to any departure by the Borrower therefrom, shall
in any event be effective  unless the same shall be in writing and signed by the
Liquidity  Provider,  and,  in the case of an  amendment  or of a waiver  by the
Borrower,  the Borrower, and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given.

          Section 7.2.  NOTICES,  ETC.  Except as otherwise  expressly  provided
herein, all notices and other communications  provided for hereunder shall be in
writing (including telecopier and mailed or delivered or sent by telecopier):

          Borrower:                WILMINGTON TRUST COMPANY
                                   Rodney Square North
                                   1100 North Market Square
                                   Wilmington, DE 19890-0001

                                   Attention: Corporate Trust Administration
                                   Telephone: (302) 651-1000
                                   Telecopy:  (302) 651-8882

          Liquidity Provider:      ABN AMRO BANK N.V.
                                   Aerospace Department
                                   135 South LaSalle Street, #820
                                   Chicago, IL 60674-9135


<PAGE>

                                   Attention: Claudia Heldring, V.P.
                                   Telephone: (312) 904-5031
                                   Telecopy:  (312) 606-8428

                                   with a copy to:

                                   ABN AMRO Bank N.V.
                                   135 South LaSalle St., #625
                                   Chicago, IL 60674-9135

                                   Attention: Loan Operations
                                   Telephone: (312) 904-2961
                                   Telecopy:  (312) 606-6893

or, as to each of the foregoing, at such other address as shall be designated by
such  Person  in  a  written  notice  to  the  others.   All  such  notices  and
communications  shall be effective (i) if given by telecopier,  when transmitted
to the telecopier  number specified above, (ii) if given by mail, when deposited
in the mails  addressed as specified  above,  and (iii) if given by other means,
when delivered at the address  specified  above,  except that written notices to
the Liquidity  Provider pursuant to the provisions of Articles II and III hereof
shall not be effective until received by the Liquidity  Provider.  A copy of all
notices  delivered  hereunder  to either party shall in addition be delivered to
each  of the  parties  to  the  Participation  Agreements  at  their  respective
addresses set forth therein.

          Section  7.3.  NO  WAIVER;  REMEDIES.  No  failure  on the part of the
Liquidity Provider to exercise, and no delay in exercising, any right under this
Agreement  shall  operate as a waiver  thereof;  nor shall any single or partial
exercise  of any right  under  this  Agreement  preclude  any  other or  further
exercise  thereof  or the  exercise  of any other  right.  The  remedies  herein
provided are cumulative and not exclusive of any remedies provided by law.

          Section  7.4.  FURTHER  ASSURANCES.  The  Borrower  agrees  to do such
further  acts and things and to execute  and deliver to the  Liquidity  Provider
such additional assignments, agreements, powers and instruments as the Liquidity
Provider  may  reasonably  require or deem  advisable  to carry into  effect the
purposes  of this  Agreement  and the other  Operative  Agreements  or to better
assure and confirm unto the Liquidity  Provider its rights,  powers and remedies
hereunder and under the other Operative Agreements.

          Section  7.5.  INDEMNIFICATION;  SURVIVAL OF CERTAIN  PROVISIONS.  The
Liquidity  Provider  shall be  indemnified  hereunder  to the  extent and in the
manner described in Section 9.1 of the  Participation  Agreements.  In addition,
the  Borrower  agrees  to  indemnify,  protect,  defend  and hold  harmless  the
Liquidity Provider from, against and in respect of, and shall pay on demand, all
Expenses of any kind or nature whatsoever (other than any Expenses of the nature
described in Sections 3.1, 3.2 or 7.7 hereof or in the Fee Letter (regardless of
whether  indemnified  against pursuant to said Sections or in such Fee Letter)),
that may be imposed,  incurred by or asserted against any Liquidity  Indemnitee,
in any way relating to,  resulting from, or arising out of or in connection with
any  action,  suit or  proceeding  by any third  party  against  such  Liquidity


<PAGE>

Indemnitee and relating to this  Agreement,  the Fee Letter,  the  Intercreditor
Agreement or any Financing Agreement; PROVIDED, HOWEVER, that the Borrower shall
not be required to  indemnify,  protect,  defend and hold harmless any Liquidity
Indemnitee in respect of any Expense of such Liquidity  Indemnitee to the extent
such Expense is (i) attributable to the gross  negligence or willful  misconduct
of such Liquidity  Indemnitee or any other Liquidity  Indemnitee,  (ii) ordinary
and usual operating  overhead expense,  or (iii)  attributable to the failure by
such  Liquidity  Indemnitee  or any other  Liquidity  Indemnitee  to  perform or
observe any  agreement,  covenant or  condition  on its part to be  performed or
observed in this Agreement, the Intercreditor Agreement, the Fee Letter, the Tax
Letter or any other Operative  Agreement to which it is a party. The indemnities
contained in such Section 9.1, and the  provisions  of Sections  3.1,  3.2, 3.3,
3.9, 7.5 and 7.7 hereof, shall survive the termination of this Agreement.

          Section 7.6. LIABILITY OF THE LIQUIDITY PROVIDER.

                      7.6.1.  Neither  the  Liquidity  Provider  nor  any of its
          officers,  employees,  directors  or  affiliates  shall be  liable  or
          responsible  for: (i) the use which may be made of the Advances or any
          acts or omissions of the Borrower or any  beneficiary or transferee in
          connection therewith; (ii) the validity, sufficiency or genuineness of
          documents,  or of any  endorsement  thereon,  even if  such  documents
          should  prove  to be in  any or all  respects  invalid,  insufficient,
          fraudulent or forged; or (iii) the making of Advances by the Liquidity
          Provider against delivery of a Notice of Borrowing and other documents
          which do not comply with the terms hereof; PROVIDED, HOWEVER, that the
          Borrower  shall have a claim against the Liquidity  Provider,  and the
          Liquidity  Provider shall be liable to the Borrower,  to the extent of
          any damages  suffered by the Borrower which were the result of (A) the
          Liquidity  Provider's  willful misconduct or negligence in determining
          whether documents presented hereunder comply with the terms hereof, or
          (B) any breach by the  Liquidity  Provider of any of the terms of this
          Agreement,  including,  but not limited to, the  Liquidity  Provider's
          failure to make lawful payment  hereunder  after the delivery to it by
          the  Borrower of a Notice of  Borrowing  strictly  complying  with the
          terms and conditions hereof.

                      7.6.2.  Neither  the  Liquidity  Provider  nor  any of its
          officers,  employees,  director  or  affiliates  shall  be  liable  or
          responsible in any respect for (i) any error,  omission,  interruption
          or delay in  transmission,  dispatch  or  delivery  of any  message or
          advice, however transmitted,  in connection with this Agreement or any
          Notice of Borrowing delivered hereunder,  or (ii) any action, inaction
          or  omission  which may be taken by it in good faith,  absent  willful
          misconduct or  negligence  (in which event the extent of the Liquidity
          Provider's potential liability to the Borrower shall be limited as set
          forth in the immediately preceding paragraph), in connection with this
          Agreement or any Notice of Borrowing.

          Section 7.7. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay, or
cause to be paid (A) on the  Effective  Date and on such  later date or dates on


<PAGE>

which the Liquidity  Provider shall make demand,  all  reasonable  out-of-pocket
costs and expenses  (including,  without  limitation,  the  reasonable  fees and
expenses  of  outside  counsel  for the  Liquidity  Provider)  of the  Liquidity
Provider in connection with the preparation,  negotiation,  execution, delivery,
filing and recording of this Agreement,  any other  Operative  Agreement and any
other documents which may be delivered in connection with this Agreement and (B)
on demand, all reasonable costs and expenses (including  reasonable counsel fees
and expenses) of the Liquidity  Provider in connection  with (i) the enforcement
of this Agreement or any other  Operative  Agreement,  (ii) the  modification or
amendment of, or supplement to, this Agreement or any other Operative  Agreement
or such  other  documents  which may be  delivered  in  connection  herewith  or
therewith  (whether or not the same shall become  effective) or (iii) any action
or  proceeding  relating to any order,  injunction,  or other  process or decree
restraining or seeking to restrain the Liquidity Provider from paying any amount
under  this  Agreement,  the  Intercreditor  Agreement  or any  other  Operative
Agreement or otherwise affecting the application of funds in the Cash Collateral
Accounts. In addition,  the Borrower shall pay any and all recording,  stamp and
other  similar  taxes and fees payable or determined to be payable in connection
with the execution,  delivery, filing and recording of this Agreement, any other
Operative  Agreement and such other documents,  and agrees to save the Liquidity
Provider  harmless from and against any and all  liabilities  with respect to or
resulting from any delay in paying or omission to pay such taxes or fees.

          Section 7.8. BINDING EFFECT; PARTICIPATIONS.

                      7.8.1.  This Agreement  shall be binding upon and inure to
          the  benefit of the  Borrower  and the  Liquidity  Provider  and their
          respective  successors and assigns,  except that neither the Liquidity
          Provider  (except  as  otherwise  provided  in this  Section  7.8) nor
          (except as  contemplated  by Section 3.8) the Borrower  shall have the
          right to assign its rights or  obligations  hereunder  or any interest
          herein without the prior written  consent of the other party,  subject
          to the  requirements  of Section  7.8(b).  The Liquidity  Provider may
          grant  participations  herein  or  in  any  of  its  rights  hereunder
          (including,    without   limitation,    funded    participations   and
          participations in rights to receive interest  payments  hereunder) and
          under the other Operative  Agreements to such Persons as the Liquidity
          Provider  may  in  its  sole   discretion   select,   subject  to  the
          requirements of Section 7.8(b). No such participation by the Liquidity
          Provider,   however,  will  relieve  the  Liquidity  Provider  of  its
          obligations  hereunder.  In connection with any  participation  or any
          proposed  participation,  the  Liquidity  Provider may disclose to the
          participant  or the  proposed  participant  any  information  that the
          Borrower  is  required  to deliver  or to  disclose  to the  Liquidity
          Provider  pursuant to this Agreement.  The Borrower  acknowledges  and
          agrees  that the  Liquidity  Provider's  source of funds may derive in
          part from its  participants  (other  than  Continental).  Accordingly,
          references  in this  Agreement and the other  Operative  Agreements to
          determinations,  reserve and capital adequacy requirements,  increased
          costs,  reduced receipts,  additional  amounts due pursuant to Section
          3.3(a) and the like as they pertain to the Liquidity Provider shall be


<PAGE>

          deemed also to include those of each of its participants  (subject, in
          each case,  to the maximum  amount that would have been incurred by or
          attributable  to the  Liquidity  Provider  directly  if the  Liquidity
          Provider,   rather  than  the  participant,   had  held  the  interest
          participated).

                      7.8.2. If, pursuant to subsection (a) above, the Liquidity
          Provider  sells any  participation  in this  Agreement  to any bank or
          other entity  (each,  a  "TRANSFEREE"),  then,  concurrently  with the
          effectiveness  of  such   participation,   the  Transferee  shall  (i)
          represent to the Liquidity  Provider (for the benefit of the Liquidity
          Provider and the Borrower)  either (A) that it is  incorporated  under
          the laws of the  United  States or a state  thereof  or (B) that under
          applicable law and treaties,  no taxes will be required to be withheld
          with respect to any payments to be made to such  Transferee in respect
          of this  Agreement,  (ii)  furnish to the  Liquidity  Provider and the
          Borrower either (x) a statement that it is incorporated under the laws
          of  the  United  States  or a  state  thereof  or  (y) if it is not so
          incorporated,  two  copies  of  a  properly  completed  United  States
          Internal  Revenue Service Form 4224 or Form 1001, as  appropriate,  or
          other  applicable  form,  certificate  or document  prescribed  by the
          Internal Revenue Service  certifying,  in each case, such Transferee's
          entitlement  to  a  complete  exemption  from  United  States  federal
          withholding  tax in  respect  to  any  and  all  payments  to be  made
          hereunder,  and (iii) agree (for the benefit of the Liquidity Provider
          and the Borrower) to provide the Liquidity Provider and the Borrower a
          new Form 4224 or Form 1001, as appropriate,  (A) on or before the date
          that any such  form  expires  or  becomes  obsolete  or (B)  after the
          occurrence  of any event  requiring  a change in the most  recent form
          previously delivered by it and prior to the immediately  following due
          date of any payment by the Borrower hereunder,  certifying in the case
          of a Form  1001 or Form 4224 that such  Transferee  is  entitled  to a
          complete  exemption  from United  States  federal  withholding  tax on
          payments under this Agreement.  Unless the Borrower has received forms
          or other  documents  reasonably  satisfactory  to it (and  required by
          applicable law) indicating that payments  hereunder are not subject to
          United  States  federal  withholding  tax, the Borrower  will withhold
          taxes  as  required  by law  from  such  payments  at  the  applicable
          statutory rate.

                      7.8.3.   Notwithstanding  the  other  provisions  of  this
          Section 7.8, the  Liquidity  Provider may assign and pledge all or any
          portion of the Advances owing to it to any Federal Reserve Bank or the
          United States Treasury as collateral security pursuant to Regulation A
          of the  Board of  Governors  of the  Federal  Reserve  System  and any
          Operating Circular issued by such Federal Reserve Bank,  provided that
          any payment in respect of such assigned  Advances made by the Borrower
          to the  Liquidity  Provider  in  accordance  with  the  terms  of this
          Agreement  shall  satisfy  the  Borrower's  obligations  hereunder  in
          respect of such  assigned  Advance to the extent of such  payment.  No
          such  assignment  shall  release  the  Liquidity   Provider  from  its
          obligations hereunder.

          Section 7.9.  SEVERABILITY.  Any provision of this Agreement  which is
prohibited,  unenforceable  or not authorized in any  jurisdiction  shall, as to


<PAGE>

such   jurisdiction,   be  ineffective  to  the  extent  of  such   prohibition,
unenforceability   or  nonauthorization   without   invalidating  the  remaining
provisions hereof or affecting the validity,  enforceability or legality of such
provision in any other jurisdiction.

          Section 7.10.  GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

          Section 7.11. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; WAIVER
OF IMMUNITY.

                      7.11.1.  Each of the parties hereto hereby irrevocably and
          unconditionally:

                            (i) submits for itself and its property in any legal
                    action or proceeding relating to this Agreement or any other
                    Operative  Agreement,  or for recognition and enforcement of
                    any   judgment  in  respect   hereof  or  thereof,   to  the
                    nonexclusive general jurisdiction of the courts of the State
                    of New York,  the courts of the United States of America for
                    the Southern  District of New York, and the appellate courts
                    from any thereof;

                           (ii) consents that any such action or proceeding  may
                    be brought in such courts,  and waives any objection that it
                    may now or hereafter have to the venue of any such action or
                    proceeding  in  any  such  court  or  that  such  action  or
                    proceeding was brought in an  inconvenient  court and agrees
                    not to plead or claim the same;

                          (iii)  agrees  that  service  of  process in  any such
                    action  or  proceeding  may be  effected  by  mailing a copy
                    thereof   by   registered   or   certified   mail   (or  any
                    substantially  similar form of mail),  postage  prepaid,  to
                    each party  hereto at its  address  set forth in Section 7.2
                    hereof,  or at such  other  address  of which the  Liquidity
                    Provider shall have been notified pursuant thereto; and

                           (iv)  agrees that  nothing  herein  shall  affect the
                    right to effect  service  of  process  in any  other  manner
                    permitted  by law or  shall  limit  the  right to sue in any
                    other jurisdiction.

                      7.11.2.  THE  BORROWER  AND THE  LIQUIDITY  PROVIDER  EACH
          HEREBY AGREE TO WAIVE THEIR  RESPECTIVE  RIGHTS TO A JURY TRIAL OF ANY
          CLAIM OR CAUSE OF ACTION  BASED UPON OR ARISING OUT OF THIS  AGREEMENT
          OR ANY DEALINGS  BETWEEN THEM  RELATING TO THE SUBJECT  MATTER OF THIS
          AGREEMENT AND THE RELATIONSHIP THAT IS BEING  ESTABLISHED,  including,
          without  limitation,  contract  claims,  tort  claims,  breach of duty
          claims and all other common law and statutory claims. The Borrower and


<PAGE>

          the Liquidity Provider each warrant and represent that it has reviewed
          this  waiver  with  its  legal  counsel,  and  that it  knowingly  and
          voluntarily  waives its jury trial rights following  consultation with
          such legal counsel. THIS WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED
          EITHER  ORALLY  OR IN  WRITING,  AND THIS  WAIVER  SHALL  APPLY TO ANY
          SUBSEQUENT AMENDMENTS,  RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
          AGREEMENT.

                      7.11.3.  The Liquidity Provider hereby waives any immunity
          it may have from the  jurisdiction  of the courts of the United States
          or of any State and waives any immunity any of its properties  located
          in the United  States may have from  attachment  or  execution  upon a
          judgement  entered by any such court under the United  States  Foreign
          Sovereign Immunities Act of 1976 or any similar successor legislation.

          Section  7.12.  EXECUTION  IN  COUNTERPARTS.  This  Agreement  may  be
executed  in any  number of  counterparts  and by  different  parties  hereto on
separate  counterparts,  each  of  which  counterparts,  when  so  executed  and
delivered,  shall be deemed  to be an  original  and all of which  counterparts,
taken together, shall constitute but one and the same Agreement.

          Section 7.13. ENTIRETY.  This Agreement,  the Intercreditor  Agreement
and the other  Operative  Agreements to which the Liquidity  Provider is a party
constitute  the entire  agreement  of the  parties  hereto  with  respect to the
subject matter hereof and supersedes all prior  understandings and agreements of
such parties.

          Section  7.14.  HEADINGS.  Section  headings  in  this  Agreement  are
included  herein for  convenience  of reference  only and shall not constitute a
part of this Agreement for any other purpose.

          Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES. EXCEPT
AS EXPRESSLY  SET FORTH IN THIS  AGREEMENT,  THE  OBLIGATIONS  OF THE  LIQUIDITY
PROVIDER  TO MAKE  ADVANCES  HEREUNDER,  AND THE  BORROWER'S  RIGHTS TO  DELIVER
NOTICES OF  BORROWING  REQUESTING  THE MAKING OF  ADVANCES  HEREUNDER,  SHALL BE
UNCONDITIONAL  AND  IRREVOCABLE,  AND SHALL BE PAID OR  PERFORMED,  IN EACH CASE
STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT.

                                      * * *


<PAGE>

          IN WITNESS WHEREOF,  the parties have caused this Agreement to be duty
executed and delivered by their respective officers thereunto duly authorized as
of the date first set forth above.

                                                                       
                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination   Agent,   as  agent   and
                                        trustee  for  the  Class  B  Trust,   as
                                        Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:



                                      ABN  AMRO  BANK N.V.,  acting  through its
                                        Chicago Branch, as Liquidity Provider



                                      By:_______________________________________
                                         Name:
                                         Title:



                                      By:_______________________________________
                                         Name:
                                         Title:


<PAGE>
                                                                      Annex I to
                                                      Revolving Credit Agreement


                      INTEREST ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
borrower (the  "BORROWER"),  hereby  certifies to ABN AMRO N.V.,  Chicago Branch
(the "LIQUIDITY  PROVIDER"),  with reference to the Revolving  Credit  Agreement
(1997-3B) dated as of September 25, 1997, between the Borrower and the Liquidity
Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein and not otherwise
defined herein being used herein as therein defined or referenced), that:

               (a)  The   Borrower   is  the   Subordination   Agent  under  the
          Intercreditor Agreement.

               (b) The Borrower is  delivering  this Notice of Borrowing for the
          making of an Interest Advance by the Liquidity Provider to be used for
          the  payment of the  interest  on the Class B  Certificates  which was
          payable on __________ (the "DISTRIBUTION DATE") in accordance with the
          terms and  provisions  of the Class B Trust  Agreement and the Class B
          Certificates,   which   Advance   is   requested   to   be   made   on
          __________________.

               (c) The amount of the Interest  Advance  requested  hereby (i) is
          $__________,  to be applied in respect of the payment of the  interest
          which  was  due  and  payable  on  the  Class  B  Certificates  on the
          Distribution  Date,  (ii) does not include any amount with  respect to
          the payment of principal of, or premium on, the Class B  Certificates,
          the Class A Certificates or the Class C  Certificates,  or interest on
          the  Class A  Certificates  or the  Class C  Certificates,  (iii)  was
          computed  in   accordance   with  the   provisions   of  the  Class  B
          Certificates,  the  Class B  Trust  Agreement  and  the  Intercreditor
          Agreement (a copy of which  computation is attached hereto as Schedule
          I), (iv) does not exceed the Maximum Available  Commitment on the date
          hereof  and (v) has not  been  and is not the  subject  of a prior  or
          contemporaneous Notice of Borrowing.

               (d) Upon  receipt by or on behalf of the  Borrower  of the amount
          requested  hereby,  (a) the Borrower will apply the same in accordance
          with the terms of Section 3.6(b) of the Intercreditor Agreement (b) no
          portion of such amount  shall be applied by the Borrower for any other
          purpose  and (c) no portion of such amount  until so applied  shall be
          commingled with other funds held by the Borrower.

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  the making of the  Interest  Advance as  requested by this Notice of
Borrowing shall  automatically  reduce,  subject to  reinstatement in accordance
with the terms of the Liquidity  Agreement,  the Maximum Available Commitment by
an amount  equal to the  amount of the  Interest  Advance  requested  to be made
hereby as set forth in clause (i) of paragraph (3) of this  Certificate and such


<PAGE>

reduction shall automatically result in corresponding  reductions in the amounts
available to be borrowed pursuant to a subsequent Advance.

                                      * * *

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the day of _________ day of ________________, ____.


                                      WILMINGTON  TRUST  COMPANY,   not   in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:


<PAGE>

               SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING



                 [Insert Copy of Computations in accordance with
                      Interest Advance Notice of Borrowing]


<PAGE>
                                                                        Annex II
                                                      Revolving Credit Agreement


                    NON-EXTENSION ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
subordination  agent (the  "BORROWER"),  hereby certifies to ABN AMRO BANK N.V.,
Chicago  Branch (the  "LIQUIDITY  PROVIDER"),  with  reference to the  Revolving
Credit Agreement  (1997-3B) dated as of September 25, 1997, between the Borrower
and the Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein
and not  otherwise  defined  herein  being  used  herein as  therein  defined or
referenced), that:

               (a)  The   Borrower   is  the   Subordination   Agent  under  the
          Intercreditor Agreement.

               (b) The Borrower is  delivering  this Notice of Borrowing for the
          making of the  Non-Extension  Advance by the Liquidity  Provider to be
          used  for the  funding  of the  Class  B Cash  Collateral  Account  in
          accordance with Section 3.6(d) of the Intercreditor  Agreement,  which
          Advance is requested to be made on _____________.

               (c) The amount of the Non-Extension  Advance requested hereby (i)
          is $__________,  which equals the Maximum Available  Commitment on the
          date  hereof and is to be  applied  in  respect of the  funding of the
          Class B Cash  Collateral  Account in accordance with Section 3.6(d) of
          the  Intercreditor  Agreement,  (ii) does not  include any amount with
          respect to the payment of the principal of, or premium on, the Class B
          Certificates,  or principal of, or interest or premium on, the Class A
          Certificates  or the  Class C  Certificates,  (iii)  was  computed  in
          accordance with the provisions of the Class B Certificates,  the Class
          B Trust  Agreement  and the  Intercreditor  Agreement (a copy of which
          computation  is attached  hereto as Schedule I), and (iv) has not been
          and is not  the  subject  of a  prior  or  contemporaneous  Notice  of
          Borrowing under the Liquidity Agreement.

               (d) Upon  receipt by or on behalf of the  Borrower  of the amount
          requested  hereby,  (a) the  Borrower  will deposit such amount in the
          Class B Cash Collateral  Account and apply the same in accordance with
          the terms of Section  3.6(d) of the  Intercreditor  Agreement,  (b) no
          portion of such amount  shall be applied by the Borrower for any other
          purpose  and (c) no portion of such amount  until so applied  shall be
          commingled with other funds held by the Borrower.

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the  Non-Extension  Advance as  requested  by this
Notice of Borrowing shall automatically and irrevocably terminate the obligation
of  the  Liquidity  Provider  to  make  further  Advances  under  the  Liquidity


<PAGE>

Agreement;  and (B)  following  the  making  by the  Liquidity  Provider  of the
Non-Extension Advance requested by this Notice of Borrowing,  the Borrower shall
not be entitled to request any further Advances under the Liquidity Agreement.

                                      * * *

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the day of _______ day of ___________________, ______.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:


<PAGE>


             SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING

                 [Insert Copy of computations in accordance with
                   Non-Extension Advance Notice of Borrowing]



<PAGE>
                                                                    Annex III to
                                                      Revolving Credit Agreement


                      DOWNGRADE ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
subordination  agent (the  "BORROWER"),  hereby certifies to ABN AMRO BANK N.V.,
Chicago  Branch (the  "LIQUIDITY  PROVIDER"),  with  reference to the  Revolving
Credit Agreement  (1997-3B) dated as of September 25, 1997, between the Borrower
and the Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein
and not  otherwise  defined  herein  being  used  herein as  therein  defined or
referenced), that:

               (a)  The   Borrower   is  the   Subordination   Agent  under  the
          Intercreditor Agreement.

               (b) The Borrower is  delivering  this Notice of Borrowing for the
          making of the Downgrade  Advance by the Liquidity  Provider to be used
          for the funding of the Class B Cash  Collateral  Account in accordance
          with Section  3.6(c) of the  Intercreditor  Agreement by reason of the
          downgrading of the  short-term  unsecured debt rating of the Liquidity
          Provider  issued by either Rating  Agency below the Threshold  Rating,
          which Advance is requested to be made on ____________, _____.

               (c) The amount of the Downgrade  Advance  requested hereby (i) is
          $_______,  which equals the Maximum  Available  Commitment on the date
          hereof and is to be  applied in respect of the  funding of the Class B
          Cash  Collateral  Account in  accordance  with  Section  3.6(c) of the
          Intercreditor Agreement, (ii) does not include any amount with respect
          to the  payment  of the  principal  of,  or  premium  on,  the Class B
          Certificates,  or principal of, or interest or premium on, the Class A
          Certificates  or the  Class C  Certificates,  (iii)  was  computed  in
          accordance with the provisions of the Class B Certificates,  the Class
          B Trust  Agreement  and the  Intercreditor  Agreement (a copy of which
          computation  is attached  hereto as Schedule I), and (iv) has not been
          and is not  the  subject  of a  prior  or  contemporaneous  Notice  of
          Borrowing under the Liquidity Agreement.

               (d) Upon  receipt by or on behalf of the  Borrower  of the amount
          requested  hereby,  (a) the  Borrower  will deposit such amount in the
          Class B Cash Collateral  Account and apply the same in accordance with
          the terms of Section  3.6(c) of the  Intercreditor  Agreement,  (b) no
          portion of such amount  shall be applied by the Borrower for any other
          purpose  and (c) no portion of such amount  until so applied  shall be
          commingled with other funds held by the Borrower.


<PAGE>

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the Downgrade  Advance as requested by this Notice
of Borrowing shall automatically and irrevocably terminate the obligation of the
Liquidity Provider to make further Advances under the Liquidity  Agreement;  and
(B)  following the making by the  Liquidity  Provider of the  Downgrade  Advance
requested by this Notice of  Borrowing,  the  Borrower  shall not be entitled to
request any further Advances under the Liquidity Agreement.

                                      * * *

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the day of _______ day of ___________________, ______.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower


                                      By:_______________________________________
                                         Name:
                                         Title:



<PAGE>


             SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING

                 [Insert Copy of computations in accordance with
                   Non-Extension Advance Notice of Borrowing]



<PAGE>
                                                                     Annex IV to
                                                      Revolving Credit Agreement


                        FINAL ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
borrower  (the  "BORROWER"),  hereby  certifies  to ABN AMRO BANK N.V.,  Chicago
Branch (the  "LIQUIDITY  PROVIDER"),  with  reference  to the  Revolving  Credit
Agreement (1997-3B) dated as of September 25, 1997, between the Borrower and the
Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein and not
otherwise  defined herein being used herein as therein  defined or  referenced),
that:

               (a)  The   Borrower   is  the   Subordination   Agent  under  the
          Intercreditor Agreement.

               (b) The Borrower is  delivering  this Notice of Borrowing for the
          making of the Final Advance by the  Liquidity  Provider to be used for
          the funding of the Class A Cash Collateral  Account in accordance with
          Section 3.6(i) of the Intercreditor Agreement by reason of the receipt
          by the Borrower of a Termination  Notice from the  Liquidity  Provider
          with respect to the Liquidity Agreement, which Advance is requested to
          be made on _________________, ____.

               (c) The  amount  of the Final  Advance  requested  hereby  (i) is
          $__________, which equals the Maximum Available Commitment on the date
          hereof and is to be  applied in respect of the  funding of the Class B
          Cash  Collateral  Account in  accordance  with  Section  3.6(i) of the
          Intercreditor Agreement, (ii) does not include any amount with respect
          to  the  payment  of  principal   of,  or  premium  on,  the  Class  B
          Certificates,  or principal of, or interest or premium on, the Class A
          Certificates  or the  Class C  Certificates,  (iii)  was  computed  in
          accordance with the provisions of the Class B Certificates,  the Class
          B Trust  Agreement  and the  Intercreditor  Agreement (a copy of which
          computation  is attached  hereto as Schedule I), and (iv) has not been
          and is not  the  subject  of a  prior  or  contemporaneous  Notice  of
          Borrowing.

               (d) Upon  receipt by or on behalf of the  Borrower  of the amount
          requested  hereby,  (a) the  Borrower  will deposit such amount in the
          Class B Cash Collateral  Account and apply the same in accordance with
          the terms of Section  3.6(i) of the  Intercreditor  Agreement,  (b) no
          portion of such amount  shall be applied by the Borrower for any other
          purpose  and (c) no portion of such amount  until so applied  shall be
          commingled with other funds held by the Borrower.


<PAGE>

               (e) The  Borrower  hereby  requests  that the  Advance  requested
          hereby be a Base Rate  Advance  [and  that such Base Rate  Advance  be
          converted  into a LIBOR  Advance on the third  Business Day  following
          your receipt of this notice].<F1>

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the Final  Advance as  requested by this Notice of
Borrowing shall  automatically  and irrevocably  terminate the obligation of the
Liquidity Provider to make further Advances under the Liquidity  Agreement;  and
(B)  following  the  making  by the  Liquidity  Provider  of the  Final  Advance
requested by this Notice of  Borrowing,  the  Borrower  shall not be entitled to
request any further Advances under the Liquidity Agreement.

                                      * * *

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the ___ day of ________________, ____.


                                      WILMINGTON  TRUST   COMPANY,   not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:





___________________

<F1>Bracketed language is optional.



<PAGE>



                 SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING

                 [Insert Copy of Computations in accordance with
                       Final Advance Notice of Borrowing]



<PAGE>
                                                                      Annex V to
                                                      Revolving Credit Agreement


                              NOTICE OF TERMINATION



                                     [Date]

Wilmington Trust Company,
  as Subordination Agent, as Borrower
Rodney Square North
North Market Square
Wilmington, DE 19890-0001

Attention: Corporate Trust Administration

          Revolving  Credit  Agreement  dated as of September 25, 1997,  between
Wilmington Trust Company,  as Subordination  Agent, as agent and trustee for the
Continental Airlines Pass Through Trust, 1997-3B, as Borrower, and ABN AMRO BANK
N.V., Chicago Branch (the "Liquidity Agreement")

Ladies and Gentlemen:

          You are hereby  notified that pursuant to Section 6.1 of the Liquidity
Agreement,  by reason of the occurrence of a Liquidity  Event of Default and the
existence of a Performing  Note  Deficiency  (each as defined  therein),  we are
giving this notice to you in order to cause (i) our obligations to make Advances
(as defined  therein) under such  Liquidity  Agreement to terminate on the fifth
Business  Day after the date on which you  receive  this  notice and (ii) you to
request a Final Advance under the Liquidity Agreement pursuant to Section 3.6(i)
of the  Intercreditor  Agreement  (as defined in the  Liquidity  Agreement) as a
consequence of your receipt of this notice.


<PAGE>

          THIS  NOTICE IS THE  "NOTICE OF  TERMINATION"  PROVIDED  FOR UNDER THE
LIQUIDITY  AGREEMENT.  OUR  OBLIGATIONS  TO MAKE  ADVANCES  UNDER THE  LIQUIDITY
AGREEMENT  WILL  TERMINATE ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU
RECEIVE THIS NOTICE.


                                      ABN  AMRO  BANK N.V.,  Chicago Branch,  as
                                        Liquidity Provider



                                      By:_______________________________________
                                         Name:
                                         Title:



                                      By:_______________________________________
                                         Name:
                                         Title:

cc:  Wilmington Trust Company,
      as Class A Trustee


<PAGE>
                                                                     Annex VI to
                                                      Revolving Credit Agreement


                    NOTICE OF REPLACEMENT SUBORDINATION AGENT

[Date]
Attention:

          Revolving  Credit  Agreement  dated as of September 25, 1997,  between
Wilmington Trust Company,  as Subordination  Agent, as agent and trustee for the
Continental Airlines Pass Through Trust, 1997-3B, as Borrower, and ABN AMRO BANK
N.V., Chicago Branch (the "Liquidity Agreement")

Ladies and Gentlemen:

          For value received,  the undersigned  beneficiary  hereby  irrevocably
transfers to:


                              (Name of Transferee)


                              (Name of Transferee)

all rights and  obligations  of the  undersigned as Borrower under the Liquidity
Agreement  referred to above.  The transferee  has succeeded the  undersigned as
Subordination  Agent under the Intercreditor  Agreement referred to in the first
paragraph of the  Liquidity  Agreement,  pursuant to the terms of Section 8.1 of
the Intercreditor Agreement.

          By this transfer,  all rights of the undersigned as Borrower under the
Liquidity  Agreement are transferred to the transferee and the transferee  shall
hereafter  have the sole  rights and  obligations  as Borrower  thereunder.  The
undersigned  shall pay any costs and expenses of such transfer,  including,  but
not limited to, transfer taxes or governmental charges.We ask that this transfer
be effective as of _______________, ___.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        ____________   individual  capacity  but
                                        solely  as   Subordination   Agent,   as
                                        Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:




================================================================================


                           REVOLVING CREDIT AGREEMENT
                                    (1997-3C)



                         Dated as of September 25, 1997

                                     between

                            WILMINGTON TRUST COMPANY,

                             as Subordination Agent,
                          as agent and trustee for the
                 Continental Airlines Pass Through Trust 1997-3C

                                   as Borrower

                                       and



                       ABN AMRO BANK N.V., CHICAGO BRANCH

                              as Liquidity Provider




                                   Relating to

                 Continental Airlines Pass Through Trust 1997-3C
             7.121% Continental Airlines Pass Through Certificates,
                                 Series 1997-3C


================================================================================


<PAGE>


<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

                                    ARTICLE I

                                   DEFINITIONS
<S>             <C>                                                          <C>
Section 1.1.    Certain Defined Terms...................................       1

                                   ARTICLE II

                       AMOUNT AND TERMS OF THE COMMITMENT
Section 2.1.    The Advances............................................       6
Section 2.2.    Making the Advances.....................................       7
Section 2.3.    Fees....................................................       9
Section 2.4.    Adjustments or Termination of the Maximum
                Commitment..............................................       9
Section 2.5.    Repayments of Interest Advances or the Final
                Advance.................................................       9
Section 2.6.    Repayments of Provider Advances.........................      10
Section 2.7.    Payments to the Liquidity Provider Under the
                Intercreditor Agreement.................................      11
Section 2.8.    Book Entries............................................      11
Section 2.9.    Payments from Available Funds Only......................      11
Section 2.10.   Extension of the Expiry Date; Non-Extension
                Advance.................................................      11

                                   ARTICLE III

                           OBLIGATIONS OF THE BORROWER
Section 3.1.    Increased Costs.........................................      12
Section 3.2.    Capital Adequacy........................................      13
Section 3.3.    Payments Free of Deductions.............................      13
Section 3.4.    Payments................................................      14
Section
 3.5.    Computations............................................      14
Section 3.6.    Payment on Non-Business Days............................      14
Section 3.7.    Interest................................................      14
Section 3.8.    Replacement of Borrower.................................      16
Section 3.9.    Funding Loss Indemnification............................      16
Section 3.10.   Illegality..............................................      16


<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)
                                                                            PAGE
                                                                            ----

                                   ARTICLE IV

                              CONDITIONS PRECEDENT
Section 4.1.    Conditions Precedent to Effectiveness of Section
                2.1.....................................................      17
Section 4.2.    Conditions Precedent to Borrowing.......................      19

                                    ARTICLE V

                                    COVENANTS
Section 5.1.    Affirmative Covenants of the Borrower...................      19
Section 5.2.    Negative Covenants of the Borrower......................      19

                                   ARTICLE VI

                           LIQUIDITY EVENTS OF DEFAULT
Section 6.1.    Liquidity Events of Default.............................      20

                                   ARTICLE VII

                                  MISCELLANEOUS
Section 7.1.    Amendments, Etc.........................................      20
Section 7.2.    Notices, Etc............................................      20
Section 7.3.    No Waiver; Remedies.....................................      21
Section 7.4.    Further Assurances......................................      21
Section 7.5.    Indemnification; Survival of Certain Provisions.........      21
Section 7.6.    Liability of the Liquidity Provider.....................      22
Section 7.7.    Costs, Expenses and Taxes...............................      23
Section 7.8.    Binding Effect; Participations..........................      23
Section 7.9.    Severability............................................      25
Section 7.10.   GOVERNING LAW...........................................      25
Section 7.11.   Submission to Jurisdiction; Waiver of Jury Trial;
                Waiver of Immunity......................................      25
Section 7.12.   Execution in Counterparts...............................      26
Section 7.13.   Entirety................................................      26
Section 7.14.   Headings................................................      26
Section 7.15.   LIQUIDITY PROVIDER'S OBLIGATION
                TO MAKE ADVANCES........................................      26


<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)

ANNEX I   Interest Advance Notice of Borrowing
ANNEX II  Non-Extension Advance Notice of Borrowing
ANNEX III Downgrade Advance Notice of Borrowing
ANNEX IV  Final Advance Notice of Borrowing
ANNEX V   Notice of Termination
ANNEX VI  Notice of Replacement Subordination Agent

</TABLE>



<PAGE>

                           REVOLVING CREDIT AGREEMENT


          This  REVOLVING  CREDIT  AGREEMENT  dated as of  September  25,  1997,
between WILMINGTON TRUST COMPANY, a Delaware corporation,  not in its individual
capacity but solely as  Subordination  Agent under the  Intercreditor  Agreement
(each as defined below),  as agent and trustee for the Class C Trust (as defined
below) (the "BORROWER"), and ABN AMRO BANK N.V., a bank organized under the laws
of The  Netherlands,  acting  through  its  Chicago  Branch  ("ABN  AMRO" or the
"LIQUIDITY PROVIDER").

                              W I T N E S S E T H:
                              - - - - - - - - - - 

          WHEREAS,  pursuant to the Class C Trust  Agreement  (such term and all
other  capitalized terms used in these recitals having the meanings set forth or
referred  to in  Section  1.1),  the  Class  C  Trust  is  issuing  the  Class C
Certificates; and

          WHEREAS,  the  Borrower,  in order to support the timely  payment of a
portion of the interest on the Class C  Certificates  in  accordance  with their
terms,  has  requested  the  Liquidity  Provider  to enter into this  Agreement,
providing in part for the Borrower to request in  specified  circumstances  that
Advances be made hereunder.

          NOW, THEREFORE,  in consideration of the premises,  the parties hereto
agree as follows:

                                    ARTICLE I

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

          Section 1.1. CERTAIN DEFINED TERMS.  (a) DEFINITIONS.  As used in this
Agreement  and unless  otherwise  expressly  indicated,  or unless  the  context
clearly  requires  otherwise,  the  following  capitalized  terms shall have the
following respective meanings for all purposes of this Agreement:

          "ADDITIONAL  COST" has the  meaning  assigned  to such term in Section
     3.1.

          "ADVANCE"  means an  Interest  Advance,  a Final  Advance,  a Provider
     Advance,  an Applied Provider Advance or an Unpaid Advance, as the case may
     be.

          "APPLICABLE  LIQUIDITY RATE" has the meaning  assigned to such term in
     Section 3.7(g).

          "APPLICABLE  MARGIN"  means (w) with respect to any Unpaid  Advance or
     Applied  Provider  Advance,  2.00% or (x)  with  respect  to any  Unapplied
     Provider Advance, .40%.

          "APPLIED  DOWNGRADE  ADVANCE" has the meaning assigned to such term in
     Section 2.6(a).


<PAGE>

          "APPLIED  NON-EXTENSION ADVANCE" has the meaning assigned to such term
     in Section 2.6(a).

          "APPLIED  PROVIDER  ADVANCE" has the meaning  assigned to such term in
     Section 2.6(a).

          "BASE RATE" means a fluctuating interest rate per annum in effect from
     time to time,  which rate per annum  shall at all times be equal to (a) the
     weighted average of the rates on overnight Federal funds  transactions with
     members of the Federal Reserve System arranged by Federal funds brokers, as
     published for such day (or, if such day is not a Business Day, for the next
     preceding Business Day) by the Federal Reserve Bank of New York, or if such
     rate is not so published for any day that is a Business Day, the average of
     the quotations for such day for such transactions received by the Liquidity
     Provider from three Federal funds brokers of recognized  standing  selected
     by it, plus (b) one-quarter of one percent (1/4 of 1%).

          "BASE RATE  ADVANCE"  means an Advance  that bears  interest at a rate
     based upon the Base Rate.

          "BORROWER"  has the  meaning  assigned  to such term in the recital of
     parties to this Agreement.

          "BORROWING"  means the making of Advances  requested  by delivery of a
     Notice of Borrowing.

          "BUSINESS  DAY" means any day other than a Saturday or Sunday or a day
     on which  commercial  banks are required or authorized to close in Houston,
     Texas,  New York,  New York,  Chicago,  Illinois or, so long as any Class C
     Certificate  is  outstanding,  the city and  state  in  which  the  Class C
     Trustee,  the Borrower or any Loan Trustee  maintains its  Corporate  Trust
     Office or receives or disburses funds, and, if the applicable  Business Day
     relates to any Advance or other amount bearing  interest based on the LIBOR
     Rate, on which dealings are carried on in the London interbank market.

          "DOWNGRADE ADVANCE" means an Advance made pursuant to Section 2.2(c).

          "EFFECTIVE  DATE"  has the  meaning  specified  in  Section  4.1.  The
     delivery of the  certificate  of the  Liquidity  Provider  contemplated  by
     Section  4.1(e) shall be conclusive  evidence  that the Effective  Date has
     occurred.

          "EXCLUDED  TAXES" means (i) taxes imposed on the overall net income of
     the Liquidity  Provider or of its Lending Office by the jurisdiction  where
     such  Liquidity  Provider's  principal  office  or such  Lending  Office is
     located, and (ii) Excluded Withholding Taxes.

          "EXCLUDED  WITHHOLDING  TAXES" means (i) withholding  Taxes imposed by
     the United States except to the extent that such United States  withholding


<PAGE>

     Taxes are  imposed  as a result of any change in  applicable  law after the
     date hereof  (excluding  from change in  applicable  law for this purpose a
     change  in an  applicable  treaty  or other  change  in law  affecting  the
     applicability  of a  treaty),  or in  the  case  of a  successor  Liquidity
     Provider  (including a transferee of an Advance) or Lending  Office,  after
     the date on which such successor Liquidity Provider obtains its interest or
     on which the Lending  Office is  changed,  and (ii) any  withholding  Taxes
     imposed by the United  States which are imposed or increased as a result of
     the Liquidity  Provider  failing to deliver to the Borrower any certificate
     or document  (which  certificate  or document in the good faith judgment of
     the  Liquidity  Provider  it is  legally  entitled  to  provide)  which  is
     reasonably  requested by the Borrower to establish that payments under this
     Agreement  are exempt from (or entitled to a reduced  rate of)  withholding
     Tax.

          "EXPENSES"  means  liabilities,   obligations,  damages,  settlements,
     penalties,  claims,  actions,  suits,  costs,  expenses,  and disbursements
     (including, without limitation,  reasonable fees and disbursements of legal
     counsel  and costs of  investigation),  provided  that  Expenses  shall not
     include any Taxes.

          "EXPIRY  DATE" means  September  24, 1998,  initially,  or any date to
     which the Expiry Date is extended pursuant to Section 2.10.

          "FINAL ADVANCE" means an Advance made pursuant to Section 2.2(d).

          "INTERCREDITOR  AGREEMENT" means the Intercreditor Agreement dated the
     date hereof,  among the  Trustees,  the Liquidity  Provider,  the liquidity
     provider under each Liquidity  Facility (other than this Agreement) and the
     Subordination Agent, as the same may be amended,  supplemented or otherwise
     modified from time to time in accordance with its terms.

          "INTEREST ADVANCE" means an Advance made pursuant to Section 2.2(a).

          "INTEREST  PERIOD" means,  with respect to any LIBOR Advance,  each of
     the following periods:

               (i) the period  beginning  on the third  Business  Day  following
     either (x) the Liquidity  Provider's receipt of the Notice of Borrowing for
     such  LIBOR  Advance or (y) the  withdrawal  of funds from the Class C Cash
     Collateral  Account  for the  purpose  of  paying  interest  on the Class C
     Certificates  as contemplated by Section 2.6(a) hereof and, in either case,
     ending on the next Regular Distribution Date; and

               (ii) each  subsequent  period  commencing  on the last day of the
     immediately  preceding  Interest  Period  and  ending  on the next  Regular
     Distribution Date;

     PROVIDED,  HOWEVER,  that if (x) the Final Advance shall have been made, or
     (y) other  outstanding  Advances  shall have been  converted into the Final
     Advance, then the Interest Periods shall be successive periods of one month
     beginning on the third  Business Day  following  the  Liquidity  Provider's


<PAGE>

     receipt of the Notice of Borrowing  for such Final  Advance (in the case of
     clause  (x)  above)  or  the  Regular   Distribution  Date  following  such
     conversion (in the case of clause (y) above).

          "LENDING  OFFICE" means the lending  office of the Liquidity  Provider
     presently located at Chicago, Illinois, or such other lending office as the
     Liquidity  Provider  from time to time  shall  notify the  Borrower  as its
     lending office  hereunder;  provided that the Liquidity  Provider shall not
     change its Lending  Office to a Lending Office outside the United States of
     America except in accordance with Section 3.1, 3.2 or 3.3 hereof.

          "LIBOR ADVANCE" means an Advance bearing interest at a rate based upon
     the LIBOR Rate.

          "LIBOR RATE" means,  with respect to any Interest Period,  the average
     (rounded upward, if necessary,  to the next higher 1/16 of 1%) of the rates
     per annum at which  deposits  in dollars  are offered to major banks in the
     London  interbank  market at  approximately  11:00 A.M.  (London  time) two
     Business  Days  before the first day of such  Interest  Period in an amount
     approximately  equal to the  principal  amount of the Advance to which such
     Interest  Period is to apply and for a period  of time  comparable  to such
     Interest Period.

          "LIQUIDITY  EVENT OF DEFAULT"  means the  occurrence of either (a) the
     Acceleration of all of the Equipment Notes or (b) a Continental  Bankruptcy
     Event.

          "LIQUIDITY  INDEMNITEE"  means (i) the  Liquidity  Provider,  (ii) the
     directors,  officers,  employees and agents of the Liquidity Provider,  and
     (iii) the  successors  and  permitted  assigns of the persons  described in
     clauses (i) and (ii), inclusive.

          "LIQUIDITY  PROVIDER"  has the  meaning  assigned  to such term in the
     recital of parties to this Agreement.

          "MAXIMUM  AVAILABLE  COMMITMENT"  shall  mean,  subject to the proviso
     contained  in  the  third  sentence  of  Section  2.2(a),  at any  time  of
     determination,  (a) the  Maximum  Commitment  at  such  time  less  (b) the
     aggregate  amount  of each  Interest  Advance  outstanding  at  such  time;
     provided that following a Provider Advance or a Final Advance,  the Maximum
     Available Commitment shall be zero.

          "MAXIMUM  COMMITMENT" means, for any day, the lesser of (x) $1,540,059
     and (y) the Required Amount on such day.

          "NON-EXTENSION  ADVANCE"  means an Advance  made  pursuant  to Section
     2.2(b).

          "NOTICE OF BORROWING" has the meaning specified in Section 2.2(e).

          "NOTICE OF REPLACEMENT  SUBORDINATION AGENT" has the meaning specified
     in Section 3.8.


<PAGE>

          "PERFORMING NOTE DEFICIENCY"  means any time that less than 65% of the
     then  aggregate  outstanding  principal  amount of all Equipment  Notes are
     Performing Equipment Notes.

          "PROSPECTUS" means the Prospectus dated July 23, 1997, as modified and
     supplemented  by  the  Prospectus  Supplement  dated  September  12,  1997,
     relating to the Certificates; and as such Prospectus may be further amended
     or supplemented.

          "PROVIDER  ADVANCE"  means  a  Downgrade  Advance  or a  Non-Extension
     Advance.

          "REGULATORY  CHANGE" has the meaning  assigned to such term in Section
     3.1.

          "REPLENISHMENT  AMOUNT"  has the  meaning  assigned  to  such  term in
     Section 2.6(b).

          "REQUIRED  AMOUNT" means, for any day, the sum of the aggregate amount
     of interest,  calculated at the rate per annum equal to the Stated Interest
     Rate for the Class C  Certificates,  that  would be  payable on the Class C
     Certificates on each of the six successive  quarterly Regular  Distribution
     Dates  immediately  following  such  day  or,  if  such  day  is a  Regular
     Distribution  Date, on such day and the succeeding  five quarterly  Regular
     Distribution  Dates,  in each  case  calculated  on the  basis  of the Pool
     Balance  of the  Class C  Certificates  on such day and  without  regard to
     expected future payments of principal on the Class C Certificates.

          "ROLLS ROYCE" means Rolls-Royce plc, a corporation organized under the
     laws of England.

          "TAX  LETTER"  means the  letter  dated the date  hereof  between  the
     Liquidity Provider and Rolls Royce pertaining to this Agreement.

          "TERMINATION  DATE" means the earliest to occur of the following:  (i)
     the  Expiry  Date;  (ii) the date on which  the  Borrower  delivers  to the
     Liquidity  Provider a certificate,  signed by a Responsible  Officer of the
     Borrower, certifying that all of the Class C Certificates have been paid in
     full (or provision  has been made for such payment in  accordance  with the
     Intercreditor  Agreement  and the Trust  Agreements)  or are  otherwise  no
     longer entitled to the benefits of this Agreement;  (iii) the date on which
     the Borrower delivers to the Liquidity Provider a certificate,  signed by a
     Responsible  Officer  of  the  Borrower,   certifying  that  a  Replacement
     Liquidity Facility has been substituted for this Agreement in full pursuant
     to Section 3.6(e) of the Intercreditor  Agreement;  (iv) the fifth Business
     Day following the receipt by the Borrower of a Termination  Notice from the
     Liquidity  Provider  pursuant to Section  6.1  hereof;  and (v) the date on
     which no Advance is or may (including by reason of  reinstatement as herein
     provided) become available for a Borrowing hereunder.

          "TERMINATION NOTICE" means the Notice of Termination  substantially in
     the form of Annex V to this Agreement.


<PAGE>


          "TRANSFEREE" has the meaning assigned to such term in Section 7.8(b).

          "UNAPPLIED  DOWNGRADE  ADVANCE" means any Downgrade Advance other than
     an Applied Downgrade Advance.

          "UNAPPLIED  PROVIDER ADVANCE" means any Provider Advance other than an
     Applied Provider Advance.

          "UNPAID ADVANCE" has the meaning assigned to such term in Section 2.5.

          (b) TERMS DEFINED IN THE INTERCREDITOR  AGREEMENT. For all purposes of
this Agreement,  the following terms shall have the respective meanings assigned
to such terms in the Intercreditor Agreement:

          "ACCELERATION,"  "CERTIFICATES",  "CLASS A CASH  COLLATERAL  ACCOUNT",
          "CLASS A CERTIFICATES", "CLASS A CERTIFICATEHOLDERS", "CLASS A TRUST",
          "CLASS A TRUST AGREEMENT", "CLASS A TRUSTEE", "CLASS B CASH COLLATERAL
          ACCOUNT", "CLASS B CERTIFICATES", "CLASS B CERTIFICATEHOLDERS", "CLASS
          B TRUST", "CLASS B TRUST AGREEMENT",  "CLASS B TRUSTEE", "CLASS C CASH
          COLLATERAL    ACCOUNT",    "CLASS    C    CERTIFICATES",    "CLASS   C
          CERTIFICATEHOLDERS",  "CLASS  C  TRUST",  "CLASS  C TRUST  AGREEMENT",
          "CLASS  C  TRUSTEE",  "CLOSING  DATE",   "CONTINENTAL",   "CONTINENTAL
          BANKRUPTCY  EVENT",  "CONTROLLING  PARTY",  "CORPORATE  TRUST OFFICE",
          "DELIVERY  PERIOD  EXPIRY  DATE",   "DISTRIBUTION  DATE",  "DOWNGRADED
          FACILITY",  "EQUIPMENT NOTES",  "FEE LETTER",  "FINANCING  AGREEMENT",
          "INDENTURE",   "INVESTMENT  EARNINGS",   "LIQUIDITY  FACILITY",  "LOAN
          TRUSTEE", "MOODY'S",  "NON-EXTENDED FACILITY", "OPERATIVE AGREEMENTS",
          "PERFORMING  EQUIPMENT  NOTE",  "PERSON",  "POOL  BALANCE",  "PURCHASE
          AGREEMENT", "RATING AGENCY", "REGULAR DISTRIBUTION DATE", "REPLACEMENT
          LIQUIDITY  FACILITY",   "RESPONSIBLE  OFFICER",  "SCHEDULED  PAYMENT",
          "SPECIAL  PAYMENT",  "STANDARD  &  POOR'S",  "STATED  INTEREST  RATE",
          "SUBORDINATION AGENT", "TAXES", "THRESHOLD RATING", "TRANSFER", "TRUST
          AGREEMENTS", "TRUSTEE",  "UNDERWRITERS",  "UNDERWRITING AGREEMENT" and
          "WRITTEN NOTICE".

                                   ARTICLE II

                       AMOUNT AND TERMS OF THE COMMITMENT
                       ----------------------------------

          Section 2.1. THE ADVANCES.  The Liquidity  Provider hereby irrevocably
agrees,  on the terms and conditions  hereinafter set forth, to make Advances to
the  Borrower  from time to time on any  Business Day during the period from the
Effective  Date until 12:00 Noon (New York City time) on the Expiry Date (unless
the  obligations  of the  Liquidity  Provider  shall be  earlier  terminated  in
accordance with the terms of Section 2.4(b)) in an aggregate  amount at any time
outstanding not to exceed the Maximum Commitment.


<PAGE>


          Section 2.2. MAKING THE ADVANCES.  Interest  Advances shall be made in
one or more  Borrowings  by  delivery to the  Liquidity  Provider of one or more
written and completed  Notices of Borrowing in substantially the form of Annex I
attached hereto,  signed by a Responsible Officer of the Borrower,  in an amount
not  exceeding the Maximum  Available  Commitment at such time and shall be used
solely for the payment when due of the interest on the Class C  Certificates  at
the Stated  Interest  Rate  therefor in  accordance  with Section  3.6(a) of the
Intercreditor   Agreement.   Each   Interest   Advance  made   hereunder   shall
automatically  reduce the Maximum Available  Commitment and the amount available
to be borrowed  hereunder by subsequent  Advances by the amount of such Interest
Advance  (subject  to  reinstatement  as provided  in the next  sentence).  Upon
repayment  to the  Liquidity  Provider  in full of the  amount  of any  Interest
Advance made pursuant to this Section  2.2(a),  together  with accrued  interest
thereon  (as  provided  herein),  the  Maximum  Available  Commitment  shall  be
reinstated by the amount of such repaid Interest Advance,  but not to exceed the
Maximum Commitment;  PROVIDED,  HOWEVER,  that the Maximum Available  Commitment
shall not be so reinstated at any time if (i) a Liquidity Event of Default shall
have occurred and be continuing and (ii) there is a Performing Note Deficiency.

                    2.2.1.  A  Non-Extension  Advance  shall be made in a single
          Borrowing if this Agreement is not extended in accordance with Section
          3.6(d) of the Intercreditor  Agreement (unless a Replacement Liquidity
          Facility  to  replace  this  Agreement   shall  have  been  previously
          delivered to the Borrower in accordance  with said Section  3.6(d)) by
          delivery to the Liquidity  Provider of a written and completed  Notice
          of Borrowing in  substantially  the form of Annex II attached  hereto,
          signed by a Responsible Officer of the Borrower, in an amount equal to
          the Maximum  Available  Commitment at such time,  and shall be used to
          fund the  Class C Cash  Collateral  Account  in  accordance  with said
          Section 3.6(d).

                    2.2.2.  A  Downgrade  Advance  shall  be  made  in a  single
          Borrowing  upon a downgrading of the Liquidity  Provider's  short-term
          unsecured  debt  rating  issued  by  either  Rating  Agency  below the
          Threshold   Rating  (as  provided   for  in  Section   3.6(c)  of  the
          Intercreditor  Agreement) unless a Replacement  Liquidity  Facility to
          replace this  Agreement  shall have been  previously  delivered to the
          Borrower in accordance  with said Section  3.6(c),  by delivery to the
          Liquidity  Provider of a written and completed  Notice of Borrowing in
          substantially  the form of Annex  III  attached  hereto,  signed  by a
          Responsible Officer of the Borrower, in an amount equal to the Maximum
          Available Commitment at such time, and shall be used to fund the Class
          C Cash Collateral Account in accordance with said Section 3.6(c).

                    2.2.3.  A Final Advance shall be made in a single  Borrowing
          upon the  receipt by the  Borrower  of a  Termination  Notice from the
          Liquidity  Provider  pursuant to Section 6.1 hereof by delivery to the
          Liquidity  Provider of a written and completed  Notice of Borrowing in
          substantially  the form of  Annex  IV  attached  hereto,  signed  by a
          Responsible Officer of the Borrower, in an amount equal to the Maximum
          Available Commitment at such time, and shall be used to fund the Class
          C Cash  Collateral  Account (in accordance  with Section 3.6(i) of the
          Intercreditor Agreement).


<PAGE>

                    2.2.4.  Each Borrowing shall be made on notice in writing (a
          "NOTICE OF BORROWING") in  substantially  the form required by Section
          2.2(a),  2.2(b),  2.2(c) or 2.2(d),  as the case may be,  given by the
          Borrower  to the  Liquidity  Provider.  If a Notice  of  Borrowing  is
          delivered  by the  Borrower in respect of any  Borrowing no later than
          12:00  Noon (New York City  time) on a  Business  Day,  the  Liquidity
          Provider  shall,  upon  satisfaction  of the conditions  precedent set
          forth in Section  4.2 with  respect to a requested  Borrowing,  before
          12:00  Noon  (New  York  City  time) on the  first  Business  Day next
          following  the day of receipt of such Notice of  Borrowing  or on such
          later  Business  Day  specified  in such  Notice  of  Borrowing,  make
          available   to  the   Borrower,   in   accordance   with  its  payment
          instructions,  in U.S.  dollars and immediately  available  funds, the
          amount of such Borrowing. If a Notice of Borrowing is delivered by the
          Borrower in respect of any  Borrowing  after 12:00 Noon (New York City
          time)  on  a  Business  Day,  the  Liquidity   Provider  shall,   upon
          satisfaction of the conditions precedent set forth in Section 4.2 with
          respect to a  requested  Borrowing,  before  12:00 Noon (New York City
          time) on the second  Business Day next following the day of receipt of
          such Notice of  Borrowing or on such later  Business Day  specified by
          the  Borrower  in such  Notice of  Borrowing,  make  available  to the
          Borrower, in accordance with its payment instructions, in U.S. dollars
          and in  immediately  available  funds,  the amount of such  Borrowing.
          Payments of proceeds of a Borrowing  shall be made by wire transfer of
          immediately  available  funds to the Borrower in accordance  with such
          wire transfer  instructions as the Borrower shall furnish from time to
          time to the  Liquidity  Provider  for such  purpose.  Each  Notice  of
          Borrowing shall be irrevocable and binding on the Borrower.

                    2.2.5. Upon the making of any Advance requested  pursuant to
          a Notice of  Borrowing,  in  accordance  with the  Borrower's  payment
          instructions,  the Liquidity Provider shall be fully discharged of its
          obligation hereunder with respect to such Notice of Borrowing, and the
          Liquidity  Provider  shall not  thereafter  be  obligated  to make any
          further  Advances  hereunder in respect of such Notice of Borrowing to
          the  Borrower  or to any other  Person.  Following  the  making of any
          Advance  pursuant  to  Section  2.2(b),  (c) or (d) hereof to fund the
          Class C Cash Collateral Account,  the Liquidity Provider shall have no
          interest  in or rights to the Class C Cash  Collateral  Account,  such
          Advance or any other amounts from time to time on deposit in the Class
          C Cash  Collateral  Account;  provided  that the  foregoing  shall not
          affect or impair the  obligations of the  Subordination  Agent to make
          the  distributions  contemplated  by  Section  3.6(e)  or  (f)  of the
          Intercreditor  Agreement.  By  paying  to  the  Borrower  proceeds  of
          Advances  requested by the Borrower in accordance  with the provisions
          of this Agreement,  the Liquidity  Provider makes no representation as
          to, and assumes no responsibility  for, the correctness or sufficiency
          for any purpose of the amount of the Advances so made and requested.

          Section  2.3.  FEES.  The  Borrower  agrees  to pay  to the  Liquidity
Provider the fees set forth in the Fee Letter.


<PAGE>

          Section 2.4. ADJUSTMENTS OR TERMINATION OF THE MAXIMUM COMMITMENT.

                    2.4.1. AUTOMATIC  ADJUSTMENTS.  Promptly following each date
          on which the Required  Amount is reduced as a result of a reduction in
          the Pool Balance of the Class C Certificates or otherwise,  clause (y)
          of the definition of Maximum Commitment shall automatically be reduced
          to an  amount  equal to the  Required  Amount  (as  calculated  by the
          Borrower).  The  Borrower  shall  give  notice  of any such  automatic
          reduction of the Maximum  Commitment to the Liquidity  Provider within
          two Business Days thereof.  The failure by the Borrower to furnish any
          such notice shall not affect such  automatic  reduction of the Maximum
          Commitment.

                    2.4.2.  TERMINATION. Upon the making of any Provider Advance
          or Final Advance  hereunder or the occurrence of the Termination Date,
          the  obligation  of the  Liquidity  Provider to make further  Advances
          hereunder  shall  automatically  and  irrevocably  terminate,  and the
          Borrower  shall not be  entitled  to  request  any  further  Borrowing
          hereunder.


          Section 2.5.  REPAYMENTS  OF INTEREST  ADVANCES OR THE FINAL  ADVANCE.
Subject to Sections 2.6, 2.7 and 2.9 hereof, the Borrower hereby agrees, without
notice of an Advance or demand for repayment from the Liquidity  Provider (which
notice and demand are hereby waived by the Borrower),  to pay, or to cause to be
paid,  to the Liquidity  Provider on each date on which the  Liquidity  Provider
shall make an Interest Advance or the Final Advance,  an amount equal to (a) the
amount of such Advance (any such Advance, until repaid, is referred to herein as
an  "UNPAID  ADVANCE"),  plus (b)  interest  on the  amount of each such  Unpaid
Advance as provided in Section 3.7 hereof;  PROVIDED  that if (i) the  Liquidity
Provider  shall  make a Provider  Advance  at any time after  making one or more
Interest  Advances  which  shall not have been  repaid in  accordance  with this
Section 2.5 or (ii) this Liquidity  Facility shall become a Downgraded  Facility
or Non-Extended  Facility at any time when  unreimbursed  Interest Advances have
reduced the Maximum  Available  Commitment to zero, then such Interest  Advances
shall  cease to  constitute  Unpaid  Advances  and  shall be deemed to have been
changed into an Applied Downgrade Advance or an Applied  Non-Extension  Advance,
as the case may be,  for all  purposes  of this  Agreement  (including,  without
limitation,  for the  purpose  of  determining  when such  Interest  Advance  is
required to be repaid to the Liquidity  Provider in accordance  with Section 2.6
and for the purposes of Section 2.6(b)). The Borrower and the Liquidity Provider
agree that the repayment in full of each  Interest  Advance and Final Advance on
the date such Advance is made is intended to be a  contemporaneous  exchange for
new value given to the Borrower by the Liquidity Provider.


          Section 2.6. REPAYMENTS OF PROVIDER ADVANCES.

                    2.6.1.  Amounts advanced  hereunder in respect of a Provider
          Advance  shall be  deposited in the Class C Cash  Collateral  Account,
          invested and withdrawn from the Class C Cash Collateral Account as set
          forth in Sections 3.6(c), (d) and (f) of the Intercreditor  Agreement.
          

<PAGE>


          The Borrower agrees to pay to the Liquidity Provider,  on each Regular
          Distribution Date,  commencing on the first Regular  Distribution Date
          after the  making of a Provider  Advance,  interest  on the  principal
          amount of any such  Provider  Advance  as  provided  in  Section  3.7;
          PROVIDED,  HOWEVER,  that  amounts in  respect  of a Provider  Advance
          withdrawn from the Class C Cash Collateral  Account for the purpose of
          paying interest on the Class C Certificates in accordance with Section
          3.6(f)  of  the  Intercreditor  Agreement  (the  amount  of  any  such
          withdrawal being (y) in the case of a Downgrade  Advance,  an "APPLIED
          DOWNGRADE ADVANCE" and (z) in the case of a Non-Extension  Advance, an
          "APPLIED   NON-EXTENSION   ADVANCE"  and,  together  with  an  Applied
          Downgrade  Advance,  an "APPLIED  PROVIDER  ADVANCE") shall thereafter
          (subject to Section  2.6(b)) be treated as an Interest  Advance  under
          this  Agreement for purposes of determining  the Applicable  Liquidity
          Rate for interest payable thereon; PROVIDED FURTHER, HOWEVER, that if,
          following the making of a Provider  Advance,  the  Liquidity  Provider
          delivers a Termination  Notice to the Borrower pursuant to Section 6.1
          hereof,  such Provider  Advance shall thereafter be treated as a Final
          Advance  under  this  Agreement  for  purposes  of   determining   the
          Applicable  Liquidity Rate for interest  payable  thereon.  Subject to
          Sections 2.7 and 2.9 hereof,  immediately  upon the  withdrawal of any
          amounts  from the Class C Cash  Collateral  Account  on  account  of a
          reduction in the  Required  Amount,  the  Borrower  shall repay to the
          Liquidity  Provider a portion of the Provider  Advances in a principal
          amount  equal to the amount of such  reduction,  plus  interest on the
          principal amount prepaid as provided in Section 3.7 hereof.

                    2.6.2. At any time when an Applied  Provider Advance (or any
          portion thereof) is outstanding,  upon the deposit in the Class C Cash
          Collateral Account of any amount pursuant to clause "THIRD" of Section
          2.4(b) of the Intercreditor  Agreement,  clause "THIRD" of Section 3.2
          of the  Intercreditor  Agreement or clause  "FOURTH" of Section 3.3 of
          the  Intercreditor  Agreement (any such amount being a  "REPLENISHMENT
          AMOUNT") for the purpose of  replenishing  or  increasing  the balance
          thereof  up to the  Required  Amount at such time,  (i) the  aggregate
          outstanding  principal amount of all Applied Provider Advances (and of
          Provider  Advances  treated as an  Interest  Advance  for  purposes of
          determining  the  Applicable   Liquidity  Rate  for  interest  payable
          thereon)  shall  be  automatically  reduced  by  the  amount  of  such
          Replenishment  Amount  and (ii) the  aggregate  outstanding  principal
          amount  of all  Unapplied  Provider  Advances  shall be  automatically
          increased by the amount of such Replenishment Amount.

                    2.6.3.  Upon  the  provision  of  a  Replacement   Liquidity
          Facility in replacement  of this Agreement in accordance  with Section
          3.6(e) of the Intercreditor Agreement, amounts remaining on deposit in
          the Class C Cash Collateral Account after giving effect to any Applied
          Provider Advance on the date of such  replacement  shall be reimbursed
          to the  Liquidity  Provider,  but only to the extent such  amounts are
          necessary to repay in full to the Liquidity Provider all amounts owing
          to it hereunder.


<PAGE>

          Section   2.7.   PAYMENTS  TO  THE   LIQUIDITY   PROVIDER   UNDER  THE
INTERCREDITOR  AGREEMENT.  In order to provide for payment or  repayment  to the
Liquidity  Provider  of  any  amounts  hereunder,  the  Intercreditor  Agreement
provides  that amounts  available  and referred to in Articles II and III of the
Intercreditor  Agreement,  to  the  extent  payable  to the  Liquidity  Provider
pursuant  to  the  terms  of the  Intercreditor  Agreement  (including,  without
limitation, Section 3.6(f) of the Intercreditor Agreement), shall be paid to the
Liquidity Provider in accordance with the terms thereof.  Amounts so paid to the
Liquidity  Provider  shall be applied by the  Liquidity  Provider  to  Liquidity
Obligations then due and payable in accordance with the Intercreditor  Agreement
or, if not provided for in the Intercreditor  Agreement,  then in such manner as
the Liquidity Provider shall deem appropriate.

          Section 2.8. BOOK ENTRIES.  The Liquidity  Provider  shall maintain in
accordance  with its usual  practice  an  account  or  accounts  evidencing  the
indebtedness of the Borrower  resulting from Advances made from time to time and
the amounts of principal  and interest  payable  hereunder and paid from time to
time in respect thereof;  PROVIDED,  HOWEVER,  that the failure by the Liquidity
Provider to maintain such account or accounts  shall not affect the  obligations
of the Borrower in respect of Advances.

          Section 2.9.  PAYMENTS FROM  AVAILABLE  FUNDS ONLY. All payments to be
made by the Borrower  under this  Agreement  shall be made only from the amounts
that constitute  Scheduled Payments,  Special Payments or payments under Section
9.1 of the  Participation  Agreements  and only to the extent that the  Borrower
shall have  sufficient  income or proceeds  therefrom  to enable the Borrower to
make  payments in  accordance  with the terms hereof after giving  effect to the
priority of payments  provisions set forth in the Intercreditor  Agreement.  The
Liquidity Provider agrees that it will look solely to such amounts to the extent
available for distribution to it as provided in the Intercreditor  Agreement and
this  Agreement  and that  the  Borrower,  in its  individual  capacity,  is not
personally  liable  to it for  any  amounts  payable  or  liability  under  this
Agreement  except as expressly  provided in this  Agreement,  the  Intercreditor
Agreement or any Participation Agreement. Amounts on deposit in the Class C Cash
Collateral  Account  shall be available to the Borrower to make  payments  under
this Agreement only to the extent and for the purposes expressly contemplated in
Section 3.6(f) of the Intercreditor Agreement.

          Section 2.10. EXTENSION OF THE EXPIRY DATE;  NON-EXTENSION ADVANCE. No
earlier  than  the 60th  day and no  later  than the 40th day  prior to the then
effective  Expiry Date  (unless such Expiry Date is on or after the date that is
15 days  after  the  Final  Maturity  Date for the  Class C  Certificates),  the
Borrower shall request that the Liquidity  Provider extend the Expiry Date for a
period of 364 days after the then effective  Expiry Date (unless the obligations
of the Liquidity  Provider are earlier  terminated in accordance  with the terms
hereof).  The Liquidity  Provider shall advise the Borrower,  no earlier than 40
days and no later than 25 days prior to the then effective Expiry Date, whether,
in its sole discretion, it agrees to so extend the Expiry Date. If the Liquidity
Provider advises the Borrower on or before the 25th day prior to the Expiry Date
then in effect  that such  Expiry  Date  shall not be so  extended,  or fails to
irrevocably  and  unconditionally  advise the Borrower on or before the 25th day
prior to the  Expiry  Date then in  effect  that such  Expiry  Date  shall be so
extended  (and,  in each case,  if the  Liquidity  Provider  shall not have been


<PAGE>


replaced in accordance with Section 3.6(e) of the Intercreditor Agreement),  the
Borrower  shall be  entitled  on and after  such 25th day (but prior to the then
effective  Expiry Date) to request a  Non-Extension  Advance in accordance  with
Section 2.2(b) hereof and Section 3.6(d) of the Intercreditor Agreement.

                                   ARTICLE III

                           OBLIGATIONS OF THE BORROWER
                           ---------------------------

          Section 3.1. INCREASED COSTS.  Subject to the Fee Letter, the Borrower
shall pay to the  Liquidity  Provider  from time to time such  amounts as may be
necessary to compensate the Liquidity  Provider for any increased costs incurred
by the Liquidity  Provider which are  attributable  to its making or maintaining
any  LIBOR  Advances  hereunder  or its  obligation  to make any  such  Advances
hereunder,  or any reduction in any amount receivable by the Liquidity  Provider
under  this  Agreement  or the  Intercreditor  Agreement  in respect of any such
Advances or such  obligation  (such increases in costs and reductions in amounts
receivable being herein called  "ADDITIONAL  COSTS"),  resulting from any change
after the date of this Agreement in U.S. federal,  state,  municipal, or foreign
laws or  regulations  (including  Regulation D), or the adoption or making after
the date of this Agreement of any interpretations,  directives,  or requirements
applying to a class of banks  including  the Liquidity  Provider  under any U.S.
federal,  state,  municipal,  or any foreign laws or regulations (whether or not
having  the  force of law) by any  court,  central  bank or  monetary  authority
charged  with  the  interpretation  or  administration  thereof  (a  "REGULATORY
CHANGE"), which: (1) changes the basis of taxation of any amounts payable to the
Liquidity  Provider under this Agreement in respect of any such Advances  (other
than Excluded Taxes);  or (2) imposes or modifies any reserve,  special deposit,
compulsory loan or similar requirements  relating to any extensions of credit or
other  assets of, or any  deposits  with  other  liabilities  of, the  Liquidity
Provider  (including  any  such  Advances  or any  deposits  referred  to in the
definition of LIBOR Rate or related definitions).  The Liquidity Provider agrees
to use  reasonable  efforts  (consistent  with  applicable  legal and regulatory
restrictions)  to change the  jurisdiction  of its Lending Office if making such
change  would  avoid the need for,  or reduce the amount of, any amount  payable
under  this  Section  3.1 that may  thereafter  accrue  and  would  not,  in the
reasonable judgment of the Liquidity Provider,  be otherwise  disadvantageous to
the Liquidity Provider.

          The Liquidity Provider will notify the Borrower of any event occurring
after the date of this  Agreement  that will entitle the  Liquidity  Provider to
compensation  pursuant to this Section 3.1 as promptly as  practicable  after it
obtains  knowledge  thereof and determines to request such  compensation,  which
notice shall describe in reasonable  detail the  calculation of the amounts owed
under this Section.  Determinations  by the  Liquidity  Provider for purposes of
this Section 3.1 of the effect of any  Regulatory  Change on its costs of making
or maintaining  Advances or on amounts  receivable by it in respect of Advances,
and of the additional  amounts required to compensate the Liquidity  Provider in
respect of any  Additional  Costs,  shall be prima facie  evidence of the amount
owed under this Section.


<PAGE>

          Section 3.2. CAPITAL  ADEQUACY.  Subject to the Fee Letter, if (1) the
adoption,  after the date hereof,  of any applicable  governmental  law, rule or
regulation regarding capital adequacy, (2) any change, after the date hereof, in
the  interpretation or administration of any such law, rule or regulation by any
central bank or other governmental  authority charged with the interpretation or
administration  thereof  or (3)  compliance  by the  Liquidity  Provider  or any
corporation  controlling the Liquidity Provider with any applicable guideline or
request of general  applicability,  issued after the date hereof, by any central
bank or other  governmental  authority  (whether or not having the force of law)
that  constitutes a change of the nature described in clause (2), has the effect
of requiring an increase in the amount of capital  required to be  maintained by
the Liquidity  Provider or any corporation  controlling the Liquidity  Provider,
and such increase is based upon the Liquidity Provider's  obligations  hereunder
and other similar obligations,  the Borrower shall pay to the Liquidity Provider
from  time to time  such  additional  amount  or  amounts  as are  necessary  to
compensate the Liquidity  Provider for such portion of such increase as shall be
reasonably  allocable to the Liquidity  Provider's  obligations  to the Borrower
hereunder.  The Liquidity Provider agrees to use reasonable efforts  (consistent
with applicable legal and regulatory restrictions) to change the jurisdiction of
its Lending Office if making such change would avoid the need for, or reduce the
amount of, any amount payable under this Section that may thereafter  accrue and
would not, in the reasonable  judgment of the Liquidity  Provider,  be otherwise
materially disadvantageous to the Liquidity Provider.

          The Liquidity Provider will notify the Borrower of any event occurring
after the date of this  Agreement  that will entitle the  Liquidity  Provider to
compensation  pursuant to this Section 3.2 as promptly as  practicable  after it
obtains  knowledge  thereof and determines to request such  compensation,  which
notice shall describe in reasonable  detail the  calculation of the amounts owed
under this Section.  Determinations  by the  Liquidity  Provider for purposes of
this Section 3.2 of the effect of any increase in the amount of capital required
to be  maintained  by the  bank and of the  amount  allocable  to the  Liquidity
Provider's  obligations to the Borrower  hereunder shall be prima facie evidence
of the amounts owed under this Section.

          Section 3.3.  PAYMENTS  FREE OF  DEDUCTIONS.  All payments made by the
Borrower  under  this  Agreement  shall be made free and clear of,  and  without
reduction  for or on account  of, any  present or future  stamp or other  taxes,
levies, imposts, duties, charges, fees, deductions,  withholdings,  restrictions
or  conditions  of any  nature  whatsoever  now or  hereafter  imposed,  levied,
collected,  withheld or assessed,  excluding  Excluded Taxes (such  non-excluded
taxes  being  referred to herein,  collectively,  as  "Non-Excluded  Taxes" and,
individually,  as a "Non-Excluded  Tax"). If any Non-Excluded Taxes are required
to be withheld  from any amounts  payable to the Liquidity  Provider  under this
Agreement,  the amounts so payable to the Liquidity  Provider shall be increased
to the extent necessary to yield to the Liquidity Provider (after payment of all
Non-Excluded  Taxes)  interest  or any other  such  amounts  payable  under this
Agreement  at the  rates or in the  amounts  specified  in this  Agreement.  The
Liquidity  Provider  agrees  to use  reasonable  efforts  (consistent  with  its
internal   policy  and  legal  and  regulatory   restrictions)   to  change  the
jurisdiction  of its Lending  Office if making such change  would avoid the need
for, or reduce the amount of, any such  additional  amounts that may  thereafter
accrue and would not, in the reasonable judgment of the Liquidity  Provider,  be
otherwise  disadvantageous to the Liquidity Provider. From time to time upon the


<PAGE>


reasonable request of the Borrower,  the Liquidity Provider agrees to provide to
the  Borrower two  original  Internal  Revenue  Service  Forms 1001 or 4224,  as
appropriate,  or any successor or other form prescribed by the Internal  Revenue
Service,  certifying that the Liquidity Provider is exempt from or entitled to a
reduced  rate of United  States  withholding  tax on  payments  pursuant to this
Agreement.

          Section 3.4.  PAYMENTS.  The  Borrower  shall make or cause to be made
each payment to the Liquidity  Provider  under this Agreement so as to cause the
same to be received by the Liquidity Provider not later than 1:00 P.M. (New York
City time) on the day when due.  The  Borrower  shall make all such  payments in
lawful  money of the United  States of  America,  to the  Liquidity  Provider in
immediately  available  funds, by wire transfer to ABN AMRO Bank N.V., New York,
NY, ABA # 026009580, Account Name: ABN AMRO Bank, N.V. - Chicago Branch, Account
#  650-001-1789-41,  Reference:  Continental  Airlines,  Inc. Pass Through Trust
1997-3C.

          Section 3.5.  COMPUTATIONS.  All computations of interest based on the
Base Rate  shall be made on the basis of a year of 365 or 366 days,  as the case
may be, and all  computations  of interest based on the LIBOR Rate shall be made
on the basis of a year of 360 days,  in each case for the actual  number of days
(including the first day but excluding the last day) occurring in the period for
which such interest is payable.

          Section 3.6. PAYMENT ON NON-BUSINESS DAYS.  Whenever any payment to be
made  hereunder  shall be stated to be due on a day other than a  Business  Day,
such payment shall be made on the next succeeding Business Day and no additional
interest shall be due as a result (and if so made,  shall be deemed to have been
made when  due).  If any  payment in  respect  of  interest  on an Advance is so
deferred to the next succeeding  Business Day, such deferral shall not delay the
commencement  of the next Interest  Period for such Advance or reduce the number
of days for which  interest will be payable on such Advance on the next interest
payment date for such Advance.

          Section 3.7. INTEREST. Subject to Section 2.9, the Borrower shall pay,
or shall  cause to be paid,  without  duplication,  interest  on (i) the  unpaid
principal  amount of each  Advance from and  including  the date of such Advance
(or, in the case of an Applied Provider Advance,  from and including the date on
which the amount thereof was withdrawn from the Class C Cash Collateral  Account
to pay  interest on the Class C  Certificates)  to but  excluding  the date such
principal  amount shall be paid in full (or, in the case of an Applied  Provider
Advance,  the  date on  which  the  Class C Cash  Collateral  Account  is  fully
replenished  in respect of such Advance) and (ii) any other amount due hereunder
(whether  fees,  commissions,  expenses  or  other  amounts  or,  to the  extent
permitted by law, installments of interest on Advances or any such other amount)
which is not paid when due  (whether  at stated  maturity,  by  acceleration  or
otherwise)  from and  including  the due date thereof to but  excluding the date
such amount is paid in full, in each such case,  at a fluctuating  interest rate
per annum for each day equal to the Applicable Liquidity Rate (as defined below)
for such Advance or such other amount as in effect for such day, but in no event
at a rate per annum greater than the maximum rate  permitted by applicable  law;
PROVIDED,  HOWEVER,  that, if at any time the otherwise applicable interest rate
as set forth in this  Section 3.7 shall  exceed the maximum  rate  permitted  by
applicable  law,  then any  subsequent  reduction in such interest rate will not


<PAGE>

reduce the rate of  interest  payable  pursuant  to this  Section  3.7 below the
maximum  rate  permitted  by  applicable  law until the total amount of interest
accrued  equals the amount of interest that would have accrued if such otherwise
applicable  interest rate as set forth in this Section 3.7 had at all times been
in effect.

          Except as provided in clause (e) below,  each Advance will be either a
Base Rate Advance or a LIBOR Advance as provided in this  Section.  Each Advance
will be a Base Rate  Advance  for the period from the date of its  borrowing  to
(but  excluding)  the third  Business Day  following  the  Liquidity  Provider's
receipt of the Notice of Borrowing  for such Advance.  Thereafter,  such Advance
shall be a LIBOR  Advance;  provided  that the Borrower (at the direction of the
Controlling  Party,  so long as the  Liquidity  Provider is not the  Controlling
Party) may (x) convert the Final  Advance  into a Base Rate  Advance on the last
day of an Interest  Period for such Advance by giving the Liquidity  Provider no
less than four Business Days' prior written notice of such election or (y) elect
to  maintain  the  Final  Advance  as Base  Rate  Advance  by not  requesting  a
conversion  of the Final  Advance  to a LIBOR  Advance  under  Clause (5) of the
applicable Notice of Borrowing.

          Each LIBOR Advance shall bear interest  during each Interest Period at
a rate per  annum  equal to the LIBOR  Rate for such  Interest  Period  plus the
Applicable Margin for such LIBOR Advance,  payable in arrears on the last day of
such Interest Period and, in the event of the payment of principal of such LIBOR
Advance on a day other than such last day,  on the date of such  payment (to the
extent of interest accrued on the amount of principal repaid).

          Each Base Rate Advance  shall bear  interest at a rate per annum equal
to the Base Rate plus the Applicable Margin for such Base Rate Advance,  payable
in arrears on each Regular Distribution Date and, in the event of the payment of
principal of such Base Rate  Advance on a day other than a Regular  Distribution
Date,  on the date of such  payment  (to the extent of  interest  accrued on the
amount of principal repaid).

          Each  Unapplied  Provider  Advance  (i)  during  the  period  from and
including the date of the making of such Unapplied  Provider Advance through but
excluding the date of repayment  thereof or of  conversion  thereof into a Final
Advance or Applied  Provider  Advance  (and for any  additional  periods of time
during which such Advance no longer  constitutes an Applied Provider Advance but
again constitutes an Unapplied  Provider Advance pursuant to Sections 2.6(a) and
(b) hereof),  shall bear interest in an amount equal to the Investment  Earnings
on amounts on deposit in the Class C Cash  Collateral  Account  for such  period
plus the Applicable Margin on the amount of such Unapplied Provider Advance from
time to time during such period, payable in arrears on each Regular Distribution
Date and (ii) after conversion  thereof into a Final Advance or Applied Provider
Advance (but only for such period of time during which such Advance  constitutes
an Applied Provider Advance pursuant to Sections 2.6(a) and (b) hereof),  as the
case may be, shall be a LIBOR Advance and shall bear interest in accordance with
clause (c) above.

          Each amount not paid when due hereunder  (whether  fees,  commissions,
expenses  or other  amounts  or, to the  extent  permitted  by  applicable  law,


<PAGE>

installments of interest on Advances but excluding Advances) shall bear interest
at a rate per annum equal to the Base Rate plus 2.00% until paid.

          Each change in the Base Rate shall become effective  immediately.  The
rates of interest  specified  in this Section 3.7 with respect to any Advance or
other amount shall be referred to as the "APPLICABLE LIQUIDITY RATE".

          Section 3.8. REPLACEMENT OF BORROWER. From time to time and subject to
the  successor  Borrower's  meeting the  eligibility  requirements  set forth in
Section 6.9 of the Intercreditor Agreement applicable to the Subordination Agent
upon the effective date and time specified in a written and completed  Notice of
Replacement  Subordination  Agent in substantially the form of Annex VI attached
hereto  (a  "NOTICE  OF  REPLACEMENT  SUBORDINATION  AGENT")  delivered  to  the
Liquidity  Provider by the then  Borrower,  the  successor  Borrower  designated
therein shall be substituted for as the Borrower for all purposes hereunder.

          Section 3.9. FUNDING LOSS  INDEMNIFICATION.  The Borrower shall pay to
the Liquidity Provider,  upon the request of the Liquidity Provider, such amount
or amounts as shall be sufficient  (in the  reasonable  opinion of the Liquidity
Provider) to compensate it for any loss,  cost, or expense incurred by reason of
the  liquidation  or  redeployment  of deposits  or other funds  acquired by the
Liquidity  Provider to fund or maintain any LIBOR Advance (but excluding loss of
anticipated profits) incurred as a result of:

          (a) Any repayment of a LIBOR Advance on a date other than the last day
of the Interest Period for such Advance; or

          (b) Any failure by the Borrower to borrow a LIBOR  Advance on the date
for borrowing specified in the relevant notice under Section 2.2.

          Section 3.10. ILLEGALITY.  Notwithstanding any other provision in this
Agreement,  if any change in any  applicable  law,  rule or  regulation,  or any
change in the  interpretation  or  administration  thereof  by any  governmental
authority,  central bank or comparable agency charged with the interpretation or
administration  thereof, or compliance by the Liquidity Provider (or its Lending
Office) with any request or  directive  (whether or not having the force of law)
of any such authority,  central bank or comparable agency shall make it unlawful
or impossible for the Liquidity  Provider (or its Lending Office) to maintain or
fund its LIBOR  Advances,  then upon  notice to the  Borrower  by the  Liquidity
Provider,  the  outstanding  principal  amount  of the LIBOR  Advances  shall be
converted to Base Rate  Advances (a)  immediately  upon demand of the  Liquidity
Provider, if such change or compliance with such request, in the judgment of the
Liquidity Provider,  requires immediate  repayment;  or (b) at the expiration of
the last Interest  Period to expire before the effective date of any such change
or request.


<PAGE>

                                   ARTICLE IV

                              CONDITIONS PRECEDENT
                              --------------------

          Section 4.1.  CONDITIONS  PRECEDENT TO  EFFECTIVENESS  OF SECTION 2.1.
Section 2.1 of this Agreement shall become effective on and as of the first date
(the  "EFFECTIVE  DATE") on which the following  conditions  precedent have been
satisfied or waived:

                    4.1.1.  The  Liquidity  Provider  shall have  received on or
          before the Closing Date each of the following, and in the case of each
          document delivered pursuant to paragraphs (i), (ii) and (iii), each in
          form and substance satisfactory to the Liquidity Provider:

                         (i) This  Agreement  duly  executed  on  behalf  of the
               Borrower;

                         (ii)  The  Intercreditor  Agreement  duly  executed  on
               behalf of each of the parties thereto;

                         (iii) Fully  executed  copies of each of the  Operative
               Agreements  executed and  delivered on or before the Closing Date
               (other than this Agreement and the Intercreditor Agreement);

                         (iv) A copy of the  Prospectus  and specimen  copies of
               the Class C Certificates;

                         (v) An  executed  copy  of each  document,  instrument,
               certificate  and opinion  delivered on or before the Closing Date
               pursuant  to the  Class  C  Trust  Agreement,  the  Intercreditor
               Agreement and the other Operative  Agreements  (together with, in
               the case of each such opinion,  other than the opinion of counsel
               for the  Underwriters,  a letter from the counsel  rendering such
               opinion to the effect that the Liquidity  Provider is entitled to
               rely on such  opinion as of its date as if it were  addressed  to
               the Liquidity Provider);

                         (v) Evidence  that there shall have been made and shall
               be in full  force and  effect,  all  filings,  recordings  and/or
               registrations,  and  there  shall  have  been  given or taken any
               notice or other similar action as may be reasonably necessary or,
               to the extent  reasonably  requested by the  Liquidity  Provider,
               reasonably advisable, in order to establish, perfect, protect and
               preserve  the  right,  title  and  interest,   remedies,  powers,
               privileges,  liens and security  interests of, or for the benefit
               of, the Trustees, the Borrower and the Liquidity Provider created
               by the Operative Agreements executed and delivered on or prior to
               the Closing Date;


<PAGE>


                         (vi) An agreement from  Continental,  pursuant to which
               (i) Continental  agrees to provide copies of quarterly  financial
               statements  and  audited  annual  financial   statements  to  the
               Liquidity  Provider,  and such other information as the Liquidity
               Provider   shall   reasonably   request   with   respect  to  the
               transactions  contemplated by the Operative  Agreements,  in each
               case, only to the extent that Continental is obligated to provide
               such  information  pursuant to Section 8.2.1 of the Leases to the
               parties  thereto  and  (ii)  Continental   agrees  to  allow  the
               Liquidity  Provider  to inspect  Continental's  books and records
               regarding  such  transactions,  and to discuss such  transactions
               with officers and employees of Continental; and

                         (vii) Such other documents,  instruments,  opinions and
               approvals  as  the  Liquidity   Provider  shall  have  reasonably
               requested.

                    4.1.2.  The following  statement  shall be true on and as of
          the Effective Date: no event has occurred and is continuing,  or would
          result from the entering  into of this  Agreement or the making of any
          Advance, which constitutes a Liquidity Event of Default.

                    4.1.3. The Liquidity Provider shall have received payment in
          full of all  fees and  other  sums  required  to be paid to or for the
          account of the Liquidity Provider on or prior to the Effective Date.

                    4.1.4.  All  conditions  precedent  to the  issuance  of the
          Certificates under the Trust Agreements shall have been satisfied, all
          conditions  precedent  to the  effectiveness  of the  other  Liquidity
          Facilities shall have been satisfied,  and all conditions precedent to
          the  purchase  of the  Certificates  by  the  Underwriters  under  the
          Underwriting  Agreement shall have been satisfied  (unless any of such
          conditions precedent shall have been waived by the Underwriters).

                    4.1.5. The Borrower shall have received a certificate, dated
          the date hereof,  signed by a duly  authorized  representative  of the
          Liquidity  Provider,  certifying that all conditions  precedent to the
          effectiveness of Section 2.1 have been satisfied or waived.

          Section 4.2. CONDITIONS PRECEDENT TO BORROWING.  The obligation of the
Liquidity Provider to make an Advance on the occasion of each Borrowing shall be
subject to the conditions  precedent that the Effective Date shall have occurred
and,  prior to the date of such  Borrowing,  the Borrower shall have delivered a
Notice of Borrowing which conforms to the terms and conditions of this Agreement
and has been  completed as may be required by the relevant form of the Notice of
Borrowing for the type of Advances requested.


<PAGE>

                                    ARTICLE V

                                    COVENANTS
                                    ---------

          Section 5.1.  AFFIRMATIVE  COVENANTS OF THE  BORROWER.  So long as any
Advance  shall remain unpaid or the  Liquidity  Provider  shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount
to the Liquidity  Provider  hereunder,  the Borrower will,  unless the Liquidity
Provider shall otherwise consent in writing:

                    5.1.1. PERFORMANCE OF THIS AND OTHER AGREEMENTS.  Punctually
          pay or cause to be paid all amounts payable by it under this Agreement
          and the other  Operative  Agreements  and  observe  and perform in all
          material   respects  the   conditions,   covenants  and   requirements
          applicable to it contained in this  Agreement and the other  Operative
          Agreements.

                    5.1.2.  REPORTING  REQUIREMENTS.  Furnish  to the  Liquidity
          Provider with reasonable  promptness,  such other information and data
          with  respect  to  the  transactions  contemplated  by  the  Operative
          Agreements  as from time to time may be  reasonably  requested  by the
          Liquidity Provider; and permit the Liquidity Provider, upon reasonable
          notice,  to inspect the  Borrower's  books and records with respect to
          such  transactions  and to meet with  officers  and  employees  of the
          Borrower to discuss such transactions.

                    5.1.3 CERTAIN OPERATIVE AGREEMENTS. Furnish to the Liquidity
          Provider with reasonable promptness, such Operative Agreements entered
          into  after the date  hereof  as from  time to time may be  reasonably
          requested by the Liquidity Provider.

          Section  5.2.  NEGATIVE  COVENANTS  OF THE  BORROWER.  So  long as any
Advance  shall remain unpaid or the  Liquidity  Provider  shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount
to the Liquidity Provider hereunder,  the Borrower will not appoint or permit or
suffer to be appointed any successor Borrower without the written consent of the
Liquidity Provider, which consent shall not be unreasonably withheld or delayed.

                                   ARTICLE VI

                           LIQUIDITY EVENTS OF DEFAULT
                           ---------------------------

          Section 6.1.  LIQUIDITY EVENTS OF DEFAULT.  If (a) any Liquidity Event
of Default has occurred  and is  continuing  and (b) there is a Performing  Note
Deficiency,  the  Liquidity  Provider  may,  in its  discretion,  deliver to the
Borrower a  Termination  Notice,  the effect of which shall be to cause (i) this
Agreement  to  expire  on the fifth  Business  Day after the date on which  such
Termination  Notice is received by the  Borrower,  (ii) the Borrower to promptly
request,  and the  Liquidity  Provider  to  promptly  make,  a Final  Advance in
accordance  with Section 2.2(d) hereof and Section  3.6(i) of the  Intercreditor
Agreement,  (iii) all other outstanding  Advances to be automatically  converted


<PAGE>

into Final  Advances for purposes of determining  the Applicable  Liquidity Rate
for interest payable  thereon,  and (iv) subject to Sections 2.7 and 2.9 hereof,
all Advances  (including,  without limitation,  any Provider Advance and Applied
Provider   Advance),   any  accrued  interest  thereon  and  any  other  amounts
outstanding  hereunder to become  immediately  due and payable to the  Liquidity
Provider.

                                   ARTICLE VII

                                  MISCELLANEOUS
                                  -------------

          Section 7.1. AMENDMENTS,  ETC. No amendment or waiver of any provision
of this Agreement, nor consent to any departure by the Borrower therefrom, shall
in any event be effective  unless the same shall be in writing and signed by the
Liquidity  Provider,  and,  in the case of an  amendment  or of a waiver  by the
Borrower,  the Borrower, and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given.


          Section 7.2.  NOTICES,  ETC.  Except as otherwise  expressly  provided
herein, all notices and other communications  provided for hereunder shall be in
writing (including telecopier and mailed or delivered or sent by telecopier):

          Borrower:                WILMINGTON  TRUST COMPANY
                                   Rodney Square North
                                   1100  North  Market  Square
                                   Wilmington, DE 19890-0001

                                   Attention: Corporate Trust Administration
                                   Telephone: (302) 651-1000
                                   Telecopy:  (302) 651-8882

          Liquidity Provider:      ABN  AMRO  BANK  N.V.
                                   Aerospace Department
                                   135 South  LaSalle  Street,  #820
                                   Chicago, IL 60674-9135

                                   Attention: Claudia Heldring, V.P.
                                   Telephone: (312) 904-5031
                                   Telecopy:  (312) 606-8428


<PAGE>

                                   with a copy to:

                                   ABN AMRO Bank N.V.
                                   135 South LaSalle St., #625
                                   Chicago, IL 60674-9135

                                   Attention: Loan Operations
                                   Telephone: (312) 904-2961
                                   Telecopy:  (312) 606-6893

or, as to each of the foregoing, at such other address as shall be designated by
such  Person  in  a  written  notice  to  the  others.   All  such  notices  and
communications  shall be effective (i) if given by telecopier,  when transmitted
to the telecopier  number specified above, (ii) if given by mail, when deposited
in the mails  addressed as specified  above,  and (iii) if given by other means,
when delivered at the address  specified  above,  except that written notices to
the Liquidity  Provider pursuant to the provisions of Articles II and III hereof
shall not be effective until received by the Liquidity  Provider.  A copy of all
notices  delivered  hereunder  to either party shall in addition be delivered to
each  of the  parties  to  the  Participation  Agreements  at  their  respective
addresses set forth therein.

          Section  7.3.  NO  WAIVER;  REMEDIES.  No  failure  on the part of the
Liquidity Provider to exercise, and no delay in exercising, any right under this
Agreement  shall  operate as a waiver  thereof;  nor shall any single or partial
exercise  of any right  under  this  Agreement  preclude  any  other or  further
exercise  thereof  or the  exercise  of any other  right.  The  remedies  herein
provided are cumulative and not exclusive of any remedies provided by law.

          Section  7.4.  FURTHER  ASSURANCES.  The  Borrower  agrees  to do such
further  acts and things and to execute  and deliver to the  Liquidity  Provider
such additional assignments, agreements, powers and instruments as the Liquidity
Provider  may  reasonably  require or deem  advisable  to carry into  effect the
purposes  of this  Agreement  and the other  Operative  Agreements  or to better
assure and confirm unto the Liquidity  Provider its rights,  powers and remedies
hereunder and under the other Operative Agreements.

          Section  7.5.  INDEMNIFICATION;  SURVIVAL OF CERTAIN  PROVISIONS.  The
Liquidity  Provider  shall be  indemnified  hereunder  to the  extent and in the
manner described in Section 9.1 of the  Participation  Agreements.  In addition,
the  Borrower  agrees  to  indemnify,  protect,  defend  and hold  harmless  the
Liquidity Provider from, against and in respect of, and shall pay on demand, all
Expenses of any kind or nature whatsoever (other than any Expenses of the nature
described in Sections 3.1, 3.2 or 7.7 hereof or in the Fee Letter (regardless of
whether  indemnified  against pursuant to said Sections or in such Fee Letter)),
that may be imposed,  incurred by or asserted against any Liquidity  Indemnitee,
in any way relating to,  resulting from, or arising out of or in connection with
any  action,  suit or  proceeding  by any third  party  against  such  Liquidity
Indemnitee and relating to this  Agreement,  the Fee Letter,  the  Intercreditor
Agreement or any Financing Agreement; PROVIDED, HOWEVER, that the Borrower shall
not be required to  indemnify,  protect,  defend and hold harmless any Liquidity
Indemnitee in respect of any Expense of such Liquidity  Indemnitee to the extent
such Expense is (i) attributable to the gross  negligence or willful  misconduct


<PAGE>

of such Liquidity  Indemnitee or any other Liquidity  Indemnitee,  (ii) ordinary
and usual operating  overhead expense,  or (iii)  attributable to the failure by
such  Liquidity  Indemnitee  or any other  Liquidity  Indemnitee  to  perform or
observe any  agreement,  covenant or  condition  on its part to be  performed or
observed in this Agreement, the Intercreditor Agreement, the Fee Letter, the Tax
Letter or any other Operative  Agreement to which it is a party. The indemnities
contained in such Section 9.1, and the  provisions  of Sections  3.1,  3.2, 3.3,
3.9, 7.5 and 7.7 hereof, shall survive the termination of this Agreement.

          Section 7.6. LIABILITY OF THE LIQUIDITY PROVIDER.OVIDER

                    7.6.1.  Neither  the  Liquidity  Provider  nor  any  of  its
          officers,  employees,  directors  or  affiliates  shall be  liable  or
          responsible  for: (i) the use which may be made of the Advances or any
          acts or omissions of the Borrower or any  beneficiary or transferee in
          connection therewith; (ii) the validity, sufficiency or genuineness of
          documents,  or of any  endorsement  thereon,  even if  such  documents
          should  prove  to be in  any or all  respects  invalid,  insufficient,
          fraudulent or forged; or (iii) the making of Advances by the Liquidity
          Provider against delivery of a Notice of Borrowing and other documents
          which do not comply with the terms hereof; PROVIDED, HOWEVER, that the
          Borrower  shall have a claim against the Liquidity  Provider,  and the
          Liquidity  Provider shall be liable to the Borrower,  to the extent of
          any damages  suffered by the Borrower which were the result of (A) the
          Liquidity  Provider's  willful misconduct or negligence in determining
          whether documents presented hereunder comply with the terms hereof, or
          (B) any breach by the  Liquidity  Provider of any of the terms of this
          Agreement,  including,  but not limited to, the  Liquidity  Provider's
          failure to make lawful payment  hereunder  after the delivery to it by
          the  Borrower of a Notice of  Borrowing  strictly  complying  with the
          terms and conditions hereof.

                    7.6.2.  Neither  the  Liquidity  Provider  nor  any  of  its
          officers,  employees,  director  or  affiliates  shall  be  liable  or
          responsible in any respect for (i) any error,  omission,  interruption
          or delay in  transmission,  dispatch  or  delivery  of any  message or
          advice, however transmitted,  in connection with this Agreement or any
          Notice of Borrowing delivered hereunder,  or (ii) any action, inaction
          or  omission  which may be taken by it in good faith,  absent  willful
          misconduct or  negligence  (in which event the extent of the Liquidity
          Provider's potential liability to the Borrower shall be limited as set
          forth in the immediately preceding paragraph), in connection with this
          Agreement or any Notice of Borrowing.

          Section 7.7. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay, or
cause to be paid (A) on the  Effective  Date and on such  later date or dates on
which the Liquidity  Provider shall make demand,  all  reasonable  out-of-pocket
costs and expenses  (including,  without  limitation,  the  reasonable  fees and
expenses  of  outside  counsel  for the  Liquidity  Provider)  of the  Liquidity
Provider in connection with the preparation,  negotiation,  execution, delivery,
filing and recording of this Agreement,  any other  Operative  Agreement and any


<PAGE>

other documents which may be delivered in connection with this Agreement and (B)
on demand, all reasonable costs and expenses (including  reasonable counsel fees
and expenses) of the Liquidity  Provider in connection  with (i) the enforcement
of this Agreement or any other  Operative  Agreement,  (ii) the  modification or
amendment of, or supplement to, this Agreement or any other Operative  Agreement
or such  other  documents  which may be  delivered  in  connection  herewith  or
therewith  (whether or not the same shall become  effective) or (iii) any action
or  proceeding  relating to any order,  injunction,  or other  process or decree
restraining or seeking to restrain the Liquidity Provider from paying any amount
under  this  Agreement,  the  Intercreditor  Agreement  or any  other  Operative
Agreement or otherwise affecting the application of funds in the Cash Collateral
Accounts. In addition,  the Borrower shall pay any and all recording,  stamp and
other  similar  taxes and fees payable or determined to be payable in connection
with the execution,  delivery, filing and recording of this Agreement, any other
Operative  Agreement and such other documents,  and agrees to save the Liquidity
Provider  harmless from and against any and all  liabilities  with respect to or
resulting from any delay in paying or omission to pay such taxes or fees.

          Section 7.8. BINDING EFFECT; PARTICIPATIONS.

                    7.8.1. This Agreement shall be binding upon and inure to the
          benefit  of  the  Borrower  and  the  Liquidity   Provider  and  their
          respective  successors and assigns,  except that neither the Liquidity
          Provider  (except  as  otherwise  provided  in this  Section  7.8) nor
          (except as  contemplated  by Section 3.8) the Borrower  shall have the
          right to assign its rights or  obligations  hereunder  or any interest
          herein without the prior written  consent of the other party,  subject
          to the  requirements  of Section  7.8(b).  The Liquidity  Provider may
          grant  participations  herein  or  in  any  of  its  rights  hereunder
          (including,    without   limitation,    funded    participations   and
          participations in rights to receive interest  payments  hereunder) and
          under the other Operative  Agreements to such Persons as the Liquidity
          Provider  may  in  its  sole   discretion   select,   subject  to  the
          requirements of Section 7.8(b). No such participation by the Liquidity
          Provider,   however,  will  relieve  the  Liquidity  Provider  of  its
          obligations  hereunder.  In connection with any  participation  or any
          proposed  participation,  the  Liquidity  Provider may disclose to the
          participant  or the  proposed  participant  any  information  that the
          Borrower  is  required  to deliver  or to  disclose  to the  Liquidity
          Provider  pursuant to this Agreement.  The Borrower  acknowledges  and
          agrees  that the  Liquidity  Provider's  source of funds may derive in
          part from its  participants  (other  than  Continental).  Accordingly,
          references  in this  Agreement and the other  Operative  Agreements to
          determinations,  reserve and capital adequacy requirements,  increased
          costs,  reduced receipts,  additional  amounts due pursuant to Section
          3.3(a) and the like as they pertain to the Liquidity Provider shall be
          deemed also to include those of each of its participants  (subject, in
          each case,  to the maximum  amount that would have been incurred by or
          attributable  to the  Liquidity  Provider  directly  if the  Liquidity
          Provider,   rather  than  the  participant,   had  held  the  interest
          participated).

                    7.8.2.  If, pursuant to subsection (a) above,  the Liquidity
          Provider  sells any  participation  in this  Agreement  to any bank or


<PAGE>

          other entity  (each,  a  "TRANSFEREE"),  then,  concurrently  with the
          effectiveness  of  such   participation,   the  Transferee  shall  (i)
          represent to the Liquidity  Provider (for the benefit of the Liquidity
          Provider and the Borrower)  either (A) that it is  incorporated  under
          the laws of the  United  States or a state  thereof  or (B) that under
          applicable law and treaties,  no taxes will be required to be withheld
          with respect to any payments to be made to such  Transferee in respect
          of this  Agreement,  (ii)  furnish to the  Liquidity  Provider and the
          Borrower either (x) a statement that it is incorporated under the laws
          of  the  United  States  or a  state  thereof  or  (y) if it is not so
          incorporated,  two  copies  of  a  properly  completed  United  States
          Internal  Revenue Service Form 4224 or Form 1001, as  appropriate,  or
          other  applicable  form,  certificate  or document  prescribed  by the
          Internal Revenue Service  certifying,  in each case, such Transferee's
          entitlement  to  a  complete  exemption  from  United  States  federal
          withholding  tax in  respect  to  any  and  all  payments  to be  made
          hereunder,  and (iii) agree (for the benefit of the Liquidity Provider
          and the Borrower) to provide the Liquidity Provider and the Borrower a
          new Form 4224 or Form 1001, as appropriate,  (A) on or before the date
          that any such  form  expires  or  becomes  obsolete  or (B)  after the
          occurrence  of any event  requiring  a change in the most  recent form
          previously delivered by it and prior to the immediately  following due
          date of any payment by the Borrower hereunder,  certifying in the case
          of a Form  1001 or Form 4224 that such  Transferee  is  entitled  to a
          complete  exemption  from United  States  federal  withholding  tax on
          payments under this Agreement.  Unless the Borrower has received forms
          or other  documents  reasonably  satisfactory  to it (and  required by
          applicable law) indicating that payments  hereunder are not subject to
          United  States  federal  withholding  tax, the Borrower  will withhold
          taxes  as  required  by law  from  such  payments  at  the  applicable
          statutory rate.

                    7.8.3.  Notwithstanding the other provisions of this Section
          7.8, the  Liquidity  Provider may assign and pledge all or any portion
          of the Advances owing to it to any Federal  Reserve Bank or the United
          States Treasury as collateral security pursuant to Regulation A of the
          Board of Governors  of the Federal  Reserve  System and any  Operating
          Circular  issued  by such  Federal  Reserve  Bank,  provided  that any
          payment in respect of such  assigned  Advances made by the Borrower to
          the Liquidity  Provider in accordance with the terms of this Agreement
          shall satisfy the Borrower's  obligations hereunder in respect of such
          assigned  Advance to the extent of such  payment.  No such  assignment
          shall release the Liquidity Provider from its obligations hereunder.

          Section 7.9.  SEVERABILITY.  Any provision of this Agreement  which is
prohibited,  unenforceable  or not authorized in any  jurisdiction  shall, as to
such   jurisdiction,   be  ineffective  to  the  extent  of  such   prohibition,
unenforceability   or  nonauthorization   without   invalidating  the  remaining
provisions hereof or affecting the validity,  enforceability or legality of such
provision in any other jurisdiction.


<PAGE>


          Section 7.10.  GOVERNING  LAW.  THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

          Section 7.11. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; WAIVER
OF IMMUNITY.

                    7.11.1.  Each of the parties hereto hereby  irrevocably  and
          unconditionally:

                         (i)  submits  for itself and its  property in any legal
               action or  proceeding  relating  to this  Agreement  or any other
               Operative  Agreement,  or for  recognition and enforcement of any
               judgment  in  respect  hereof  or  thereof,  to the  nonexclusive
               general  jurisdiction of the courts of the State of New York, the
               courts of the United States of America for the Southern  District
               of New York, and the appellate courts from any thereof;

                         (ii) consents that any such action or proceeding may be
               brought in such courts,  and waives any objection that it may now
               or hereafter  have to the venue of any such action or  proceeding
               in any such court or that such action or  proceeding  was brought
               in an  inconvenient  court and  agrees  not to plead or claim the
               same;

                         (iii) agrees that service of process in any such action
               or  proceeding  may be  effected  by  mailing a copy  thereof  by
               registered or certified mail (or any  substantially  similar form
               of mail),  postage  prepaid,  to each party hereto at its address
               set forth in Section  7.2  hereof,  or at such  other  address of
               which the Liquidity  Provider  shall have been notified  pursuant
               thereto; and

                         (iv) agrees that nothing  herein shall affect the right
               to effect service of process in any other manner permitted by law
               or shall limit the right to sue in any other jurisdiction.

                    7.11.2.  THE BORROWER AND THE LIQUIDITY PROVIDER EACH HEREBY
          AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
          CAUSE OF ACTION  BASED UPON OR ARISING  OUT OF THIS  AGREEMENT  OR ANY
          DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT
          AND THE RELATIONSHIP  THAT IS BEING  ESTABLISHED,  including,  without
          limitation,  contract claims,  tort claims,  breach of duty claims and
          all other  common  law and  statutory  claims.  The  Borrower  and the
          Liquidity  Provider  each warrant and  represent  that it has reviewed
          this  waiver  with  its  legal  counsel,  and  that it  knowingly  and
          voluntarily  waives its jury trial rights following  consultation with
          such legal counsel. THIS WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED


<PAGE>

          EITHER  ORALLY  OR IN  WRITING,  AND THIS  WAIVER  SHALL  APPLY TO ANY
          SUBSEQUENT AMENDMENTS,  RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
          AGREEMENT.

                    7.11.3. The Liquidity Provider hereby waives any immunity it
          may have from the  jurisdiction  of the courts of the United States or
          of any State and waives any immunity any of its properties  located in
          the  United  States  may have  from  attachment  or  execution  upon a
          judgement  entered by any such court under the United  States  Foreign
          Sovereign Immunities Act of 1976 or any similar successor legislation.

          Section  7.12.  EXECUTION  IN  COUNTERPARTS.  This  Agreement  may  be
executed  in any  number of  counterparts  and by  different  parties  hereto on
separate  counterparts,  each  of  which  counterparts,  when  so  executed  and
delivered,  shall be deemed  to be an  original  and all of which  counterparts,
taken together, shall constitute but one and the same Agreement.

          Section 7.13. ENTIRETY.  This Agreement,  the Intercreditor  Agreement
and the other  Operative  Agreements to which the Liquidity  Provider is a party
constitute  the entire  agreement  of the  parties  hereto  with  respect to the
subject matter hereof and supersedes all prior  understandings and agreements of
such parties.

          Section  7.14.  HEADINGS.  Section  headings  in  this  Agreement  are
included  herein for  convenience  of reference  only and shall not constitute a
part of this Agreement for any other purpose.

          Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES. EXCEPT
AS EXPRESSLY  SET FORTH IN THIS  AGREEMENT,  THE  OBLIGATIONS  OF THE  LIQUIDITY
PROVIDER  TO MAKE  ADVANCES  HEREUNDER,  AND THE  BORROWER'S  RIGHTS TO  DELIVER
NOTICES OF  BORROWING  REQUESTING  THE MAKING OF  ADVANCES  HEREUNDER,  SHALL BE
UNCONDITIONAL  AND  IRREVOCABLE,  AND SHALL BE PAID OR  PERFORMED,  IN EACH CASE
STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT.

                                      * * *


<PAGE>

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

                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination   Agent,   as  agent   and
                                        trustee  for  the  Class  C  Trust,   as
                                        Borrower



                                      By:_______________________________________
                                        Name:
                                        Title:



                                      ABN  AMRO  BANK N.V.,  acting  through its
                                        Chicago Branch, as Liquidity Provider



                                      By:_______________________________________
                                        Name:
                                        Title:



                                      By:_______________________________________
                                        Name:
                                        Title:




<PAGE>

                                                                      Annex I to
                                                      Revolving Credit Agreement

                      INTEREST ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
borrower (the  "BORROWER"),  hereby  certifies to ABN AMRO N.V.,  Chicago Branch
(the "LIQUIDITY  PROVIDER"),  with reference to the Revolving  Credit  Agreement
(1997-3C) dated as of September 25, 1997, between the Borrower and the Liquidity
Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein and not otherwise
defined herein being used herein as therein defined or referenced), that:

          (a) The Borrower is the  Subordination  Agent under the  Intercreditor
Agreement.

          (b) The Borrower is delivering this Notice of Borrowing for the making
of an Interest  Advance by the Liquidity  Provider to be used for the payment of
the interest on the Class C  Certificates  which was payable on  _______________
(the  "DISTRIBUTION  DATE") in accordance  with the terms and  provisions of the
Class C Trust Agreement and the Class C Certificates, which Advance is requested
to be made on _________________.

          (c)  The  amount  of the  Interest  Advance  requested  hereby  (i) is
$_____________  , to be applied in respect of the payment of the interest  which
was due and payable on the Class C Certificates on the  Distribution  Date, (ii)
does not  include any amount with  respect to the  payment of  principal  of, or
premium on, the Class C  Certificates,  the Class B Certificates  or the Class A
Certificates,   or  interest  on  the  Class  B  Certificates  or  the  Class  A
Certificates,  (iii) was computed in accordance with the provisions of the Class
C Certificates,  the Class C Trust Agreement and the Intercreditor  Agreement (a
copy of which  computation  is  attached  hereto as  Schedule  I), (iv) does not
exceed the Maximum Available  Commitment on the date hereof and (v) has not been
and is not the subject of a prior or contemporaneous Notice of Borrowing.

          (d)  Upon  receipt  by or on  behalf  of the  Borrower  of the  amount
requested  hereby,  (a) the Borrower will apply the same in accordance  with the
terms of Section  3.6(b) of the  Intercreditor  Agreement (b) no portion of such
amount shall be applied by the Borrower for any other purpose and (c) no portion
of such amount until so applied shall be commingled with other funds held by the
Borrower.

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  the making of the  Interest  Advance as  requested by this Notice of
Borrowing shall  automatically  reduce,  subject to  reinstatement in accordance
with the terms of the Liquidity  Agreement,  the Maximum Available Commitment by
an amount  equal to the  amount of the  Interest  Advance  requested  to be made
hereby as set forth in clause (i) of paragraph (3) of this  Certificate and such
reduction shall automatically result in corresponding  reductions in the amounts
available to be borrowed pursuant to a subsequent Advance.

                                      * * *


<PAGE>

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the ______ day of____________, _____.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                       By:______________________________________
                                          Name:
                                          Title:


<PAGE>

               SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING

                [Insert Copy of Computations in accordance with
                     Interest Advance Notice of Borrowing]


<PAGE>

                                                                        Annex II
                                                      Revolving Credit Agreement

                   NON-EXTENSION ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
subordination  agent (the  "BORROWER"),  hereby certifies to ABN AMRO BANK N.V.,
Chicago  Branch (the  "LIQUIDITY  PROVIDER"),  with  reference to the  Revolving
Credit Agreement  (1997-3C) dated as of September 25, 1997, between the Borrower
and the Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein
and not  otherwise  defined  herein  being  used  herein as  therein  defined or
referenced), that:

          (a) The Borrower is the  Subordination  Agent under the  Intercreditor
Agreement.

          (b) The Borrower is delivering this Notice of Borrowing for the making
of the  Non-Extension  Advance  by the  Liquidity  Provider  to be used  for the
funding of the Class C Cash Collateral Account in accordance with Section 3.6(d)
of the Intercreditor Agreement, which Advance is requested to be made on .

          (c) The amount of the  Non-Extension  Advance  requested hereby (i) is
$__________,  which equals the Maximum  Available  Commitment on the date hereof
and is to be applied in  respect of the  funding of the Class C Cash  Collateral
Account in accordance with Section 3.6(d) of the Intercreditor  Agreement,  (ii)
does not include any amount with respect to the payment of the  principal of, or
premium on, the Class C  Certificates,  or principal  of, or interest or premium
on, the Class B Certificates or the Class A Certificates,  (iii) was computed in
accordance  with the provisions of the Class C  Certificates,  the Class C Trust
Agreement  and the  Intercreditor  Agreement  (a copy of  which  computation  is
attached  hereto as Schedule I), and (iv) has not been and is not the subject of
a prior or contemporaneous Notice of Borrowing under the Liquidity Agreement.

          (d)  Upon  receipt  by or on  behalf  of the  Borrower  of the  amount
requested hereby,  (a) the Borrower will deposit such amount in the Class C Cash
Collateral  Account and apply the same in  accordance  with the terms of Section
3.6(d) of the  Intercreditor  Agreement,  (b) no portion of such amount shall be
applied by the Borrower for any other  purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the Borrower.

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the  Non-Extension  Advance as  requested  by this
Notice of Borrowing shall automatically and irrevocably terminate the obligation
of  the  Liquidity  Provider  to  make  further  Advances  under  the  Liquidity
Agreement;  and (B)  following  the  making  by the  Liquidity  Provider  of the
Non-Extension Advance requested by this Notice of Borrowing,  the Borrower shall
not be entitled to request any further Advances under the Liquidity Agreement.

                                      * * *


<PAGE>

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the day of ______ day of _____________, _____.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                       By:______________________________________
                                          Name:
                                          Title:


<PAGE>

            SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING

                 [Insert Copy of computations in accordance with
                   Non-Extension Advance Notice of Borrowing]


<PAGE>

                                                                    Annex III to
                                                      Revolving Credit Agreement

                     DOWNGRADE ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
subordination  agent (the  "BORROWER"),  hereby certifies to ABN AMRO BANK N.V.,
Chicago  Branch (the  "LIQUIDITY  PROVIDER"),  with  reference to the  Revolving
Credit Agreement  (1997-3C) dated as of September 25, 1997, between the Borrower
and the Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein
and not  otherwise  defined  herein  being  used  herein as  therein  defined or
referenced), that:

          (a) The Borrower is the  Subordination  Agent under the  Intercreditor
Agreement.

          (b) The Borrower is delivering this Notice of Borrowing for the making
of the Downgrade Advance by the Liquidity Provider to be used for the funding of
the Class C Cash  Collateral  Account in accordance  with Section  3.6(c) of the
Intercreditor Agreement by reason of the downgrading of the short-term unsecured
debt rating of the Liquidity  Provider  issued by either Rating Agency below the
Threshold Rating, which Advance is requested to be made on ____________, _____.

          (c) The  amount  of the  Downgrade  Advance  requested  hereby  (i) is
$_______,  which equals the Maximum Available  Commitment on the date hereof and
is to be  applied  in  respect  of the  funding  of the Class C Cash  Collateral
Account in accordance with Section 3.6(c) of the Intercreditor  Agreement,  (ii)
does not include any amount with respect to the payment of the  principal of, or
premium on, the Class C  Certificates,  or principal  of, or interest or premium
on, the Class B Certificates or the Class A Certificates,  (iii) was computed in
accordance  with the provisions of the Class C  Certificates,  the Class C Trust
Agreement  and the  Intercreditor  Agreement  (a copy of  which  computation  is
attached  hereto as Schedule I), and (iv) has not been and is not the subject of
a prior or contemporaneous Notice of Borrowing under the Liquidity Agreement.

          (d)  Upon  receipt  by or on  behalf  of the  Borrower  of the  amount
requested hereby,  (a) the Borrower will deposit such amount in the Class C Cash
Collateral  Account and apply the same in  accordance  with the terms of Section
3.6(c) of the  Intercreditor  Agreement,  (b) no portion of such amount shall be
applied by the Borrower for any other  purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the Borrower.

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the Downgrade  Advance as requested by this Notice
of Borrowing shall automatically and irrevocably terminate the obligation of the
Liquidity Provider to make further Advances under the Liquidity  Agreement;  and
(B)  following the making by the  Liquidity  Provider of the  Downgrade  Advance
requested by this Notice of  Borrowing,  the  Borrower  shall not be entitled to
request any further Advances under the Liquidity Agreement.



<PAGE>

          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the ___ day of _____________, _____.

                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:



<PAGE>

              SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING

                 [Insert Copy of computations in accordance with
                     Downgrade Advance Notice of Borrowing]


<PAGE>

                                                                     Annex IV to
                                                      Revolving Credit Agreement

                       FINAL ADVANCE NOTICE OF BORROWING


          The  undersigned,  a duly  authorized  signatory  of  the  undersigned
borrower  (the  "BORROWER"),  hereby  certifies  to ABN AMRO BANK N.V.,  Chicago
Branch (the  "LIQUIDITY  PROVIDER"),  with  reference  to the  Revolving  Credit
Agreement (1997-3C) dated as of September 25, 1997, between the Borrower and the
Liquidity Provider (the "LIQUIDITY AGREEMENT"; the terms defined therein and not
otherwise  defined herein being used herein as therein  defined or  referenced),
that:

          (a) The Borrower is the  Subordination  Agent under the  Intercreditor
Agreement.

          (b) The Borrower is delivering this Notice of Borrowing for the making
of the Final Advance by the Liquidity Provider to be used for the funding of the
Class A Cash  Collateral  Account  in  accordance  with  Section  3.6(i)  of the
Intercreditor  Agreement  by  reason  of  the  receipt  by  the  Borrower  of  a
Termination  Notice from the  Liquidity  Provider  with respect to the Liquidity
Agreement, which Advance is requested to be made on ______________, ___.

          (c)  The  amount  of  the  Final  Advance   requested  hereby  (i)  is
$__________,  which equals the Maximum  Available  Commitment on the date hereof
and is to be applied in  respect of the  funding of the Class C Cash  Collateral
Account in accordance with Section 3.6(i) of the Intercreditor  Agreement,  (ii)
does not  include any amount with  respect to the  payment of  principal  of, or
premium on, the Class C  Certificates,  or principal  of, or interest or premium
on, the Class B Certificates or the Class A Certificates,  (iii) was computed in
accordance  with the provisions of the Class C  Certificates,  the Class C Trust
Agreement  and the  Intercreditor  Agreement  (a copy of  which  computation  is
attached  hereto as Schedule I), and (iv) has not been and is not the subject of
a prior or contemporaneous Notice of Borrowing.

          (d)  Upon  receipt  by or on  behalf  of the  Borrower  of the  amount
requested hereby,  (a) the Borrower will deposit such amount in the Class C Cash
Collateral  Account and apply the same in  accordance  with the terms of Section
3.6(i) of the  Intercreditor  Agreement,  (b) no portion of such amount shall be
applied by the Borrower for any other  purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the Borrower.

          (e) The Borrower hereby requests that the Advance  requested hereby be
a Base Rate Advance  [and that such Base Rate Advance be converted  into a LIBOR
Advance on the third Business Day following your receipt of this notice].<F1>

          The  Borrower  hereby  acknowledges  that,  pursuant to the  Liquidity
Agreement,  (A) the making of the Final  Advance as  requested by this Notice of

___________________

<F1>Bracketed language is optional.




<PAGE>

Borrowing shall  automatically  and irrevocably  terminate the obligation of the
Liquidity Provider to make further Advances under the Liquidity  Agreement;  and
(B)  following  the  making  by the  Liquidity  Provider  of the  Final  Advance
requested by this Notice of  Borrowing,  the  Borrower  shall not be entitled to
request any further Advances under the Liquidity Agreement.

                                      * * *


<PAGE>



          IN WITNESS  WHEREOF,  the Borrower has  executed  and  delivered  this
Notice of Borrowing as of the ___ day of ______________, __________.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:


<PAGE>

                SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING

                 [Insert Copy of Computations in accordance with
                       Final Advance Notice of Borrowing]


<PAGE>

                                                                      Annex V to
                                                      Revolving Credit Agreement

                             NOTICE OF TERMINATION

                                                            [Date]

Wilmington Trust Company,
  as Subordination Agent, as Borrower
Rodney Square North
1100 North Market Square
Wilmington, DE 19890-0001

Attention: Corporate Trust Administration

          Revolving  Credit  Agreement  dated as of September 25, 1997,  between
Wilmington Trust Company,  as Subordination  Agent, as agent and trustee for the
Continental Airlines Pass Through Trust, 1997-3C, as Borrower, and ABN AMRO BANK
N.V., Chicago Branch (the "Liquidity Agreement")



Ladies and Gentlemen:

          You are hereby  notified that pursuant to Section 6.1 of the Liquidity
Agreement,  by reason of the occurrence of a Liquidity  Event of Default and the
existence of a Performing  Note  Deficiency  (each as defined  therein),  we are
giving this notice to you in order to cause (i) our obligations to make Advances
(as defined  therein) under such  Liquidity  Agreement to terminate on the fifth
Business  Day after the date on which you  receive  this  notice and (ii) you to
request a Final Advance under the Liquidity Agreement pursuant to Section 3.6(i)
of the  Intercreditor  Agreement  (as defined in the  Liquidity  Agreement) as a
consequence of your receipt of this notice.


<PAGE>

          THIS  NOTICE IS THE  "NOTICE OF  TERMINATION"  PROVIDED  FOR UNDER THE
LIQUIDITY  AGREEMENT.  OUR  OBLIGATIONS  TO MAKE  ADVANCES  UNDER THE  LIQUIDITY
AGREEMENT  WILL  TERMINATE ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU
RECEIVE THIS NOTICE.

                                      Very truly yours,

                                      ABN  AMRO  BANK N.V.,  Chicago Branch,  as
                                        Liquidity Provider



                                      By:_____________________________________
                                         Name:
                                         Title:



                                      By:_____________________________________
                                         Name:
                                         Title:

cc: Wilmington Trust Company,


<PAGE>

                                                                     Annex VI to
                                                      Revolving Credit Agreement

                   NOTICE OF REPLACEMENT SUBORDINATION AGENT

[Date]
Attention:



          Revolving  Credit  Agreement  dated as of September 25, 1997,  between
Wilmington Trust Company,  as Subordination  Agent, as agent and trustee for the
Continental Airlines Pass Through Trust, 1997-3C, as Borrower, and ABN AMRO BANK
N.V., Chicago Branch (the "Liquidity Agreement")



Ladies and Gentlemen:

          For value received,  the undersigned  beneficiary  hereby  irrevocably
transfers to:



                              (Name of Transferee)



                              (Name of Transferee)

all rights and  obligations  of the  undersigned as Borrower under the Liquidity
Agreement  referred to above.  The transferee  has succeeded the  undersigned as
Subordination  Agent under the Intercreditor  Agreement referred to in the first
paragraph of the  Liquidity  Agreement,  pursuant to the terms of Section 8.1 of
the Intercreditor Agreement.

          By this transfer,  all rights of the undersigned as Borrower under the
Liquidity  Agreement are transferred to the transferee and the transferee  shall
hereafter  have the sole  rights and  obligations  as Borrower  thereunder.  The
undersigned  shall pay any costs and expenses of such transfer,  including,  but
not limited to, transfer taxes or governmental charges.


<PAGE>

          We ask that this transfer be effective as of _______________, ___.


                                      WILMINGTON   TRUST   COMPANY,  not  in its
                                        individual   capacity   but   solely  as
                                        Subordination Agent, as Borrower



                                      By:_______________________________________
                                         Name:
                                         Title:





<PAGE>

                                                                     EXHIBIT 4.4

                      FORM OF PASS THROUGH TRUST AGREEMENT


<PAGE>
     
- --------------------------------------------------------------------------------

                          PASS THROUGH TRUST AGREEMENT

                         Dated as of September 25, 1997


                                     between


                           CONTINENTAL AIRLINES, INC.

                                       and

                            WILMINGTON TRUST COMPANY,

                                   as Trustee


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


<PAGE>


<TABLE>
<CAPTION>
                               TABLE OF CONTENTS
                                                                            Page
                                                                            ----


                             ARTICLE I - DEFINITIONS

<S>             <C>                                                          <C>
Section 1.01.   Definitions............................................        2
Section 1.02.   Compliance Certificates and Opinions...................       11
Section 1.03.   Form of Documents Delivered to Trustee.................       12
Section 1.04.   Directions of Certificateholders.......................       12

                 ARTICLE II - ORIGINAL ISSUANCE OF CERTIFICATES:
                          ACQUISITION OF TRUST PROPERTY

Section 2.01.   Amount Unlimited; Issuable in Series...................       13
Section 2.02.   Acquisition of Equipment Notes.........................       15
Section 2.03.   Acceptance by Trustee..................................       17
Section 2.04.   Limitation of Powers...................................       17

                         ARTICLE III - THE CERTIFICATES

Section 3.01.   Form, Denomination and Execution of Certificates.......       18
Section 3.02.   Authentication of Certificates.........................       18
Section 3.03.   Temporary Certificates.................................       19
Section 3.04.   Transfer and Exchange..................................       19
Section 3.05.   Book-Entry and Definitive Certificates.................       20
Section 3.06.   Mutilated, Destroyed, Lost or Stolen Certificates......       22
Section 3.07.   Persons Deemed Owners..................................       22
Section 3.08.   Cancellation...........................................       22
Section 3.09.   Limitation of Liability for Payments...................       23

          ARTICLE IV - DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS


Section 4.01.   Certificate Account and Special Payments Account.......       23
Section 4.02.   Distributions from Certificate Account and Special
                Payments Account.......................................       24
Section 4.03.   Statements to Certificateholders.......................       25
Section 4.04.   Investment of Special Payment Moneys...................       26

                             ARTICLE V - THE COMPANY

Section 5.01.   Maintenance of Corporate Existence.....................       27
Section 5.02.   Consolidation, Merger, Etc.............................       27

                              ARTICLE VI - DEFAULT

Section 6.01.   Events of Default......................................       28


<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)

                                                                            Page
                                                                            ----

Section 6.02.   Incidents of Sale of Equipment Notes...................       29
Section 6.03.   Judicial Proceedings Instituted by Trustee; Trustee May
                Bring Suit.............................................       30
Section 6.04.   Control by Certificateholders..........................       30
Section 6.05.   Waiver of Past Defaults................................       30
Section 6.06.   Right of Certificateholders to Receive Payments Not to
                Be Impaired............................................       31
Section 6.07.   Certificateholders May Not Bring Suit Except Under
                Certain Conditions.....................................       31
Section 6.08.   Remedies Cumulative....................................       32
Section 6.09.   Undertaking for Costs..................................       32

                            ARTICLE VII - THE TRUSTEE

Section 7.01.   Certain Duties and Responsibilities....................       32
Section 7.02.   Notice of Defaults.....................................       33
Section 7.03.   Certain Rights of Trustee..............................       33
Section 7.04.   Not Responsible for Recitals or Issuance of
                Certificates...........................................       35
Section 7.05.   May Hold Certificates..................................       35
Section 7.06.   Money Held in Trust....................................       35
Section 7.07.   Compensation and Reimbursement.........................       35
Section 7.08.   Corporate Trustee Required; Eligibility................       36
Section 7.09.   Resignation and Removal; Appointment of Successor......       36
Section 7.10.   Acceptance of Appointment by Successor.................       38
Section 7.11.   Merger, Conversion, Consolidation or Succession to
                Business...............................................       39
Section 7.12.   Maintenance of Agencies................................       39
Section 7.13.   Money for Certificate Payments to Be Held in Trust.....       40
Section 7.14.   Registration of Equipment Notes in Trustee's Name......       40
Section 7.15.   Representations and Warranties of Trustee..............       41
Section 7.16.   Withholding Taxes; Information Reporting...............       42
Section 7.17.   Trustee's Liens........................................       42
Section 7.18.   Preferential Collection of Claims......................       42

         ARTICLE VIII - CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE

Section 8.01.   The Company to Furnish Trustee with Names and
                 Addresses of Certificateholders.......................       42
Section 8.02.   Preservation of Information; Communications to
                Certificateholders.....................................       43
Section 8.03.   Reports by Trustee.....................................       43
Section 8.04.   Reports by the Company.................................       43


<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)

                                                                            Page
                                                                            ----
                      ARTICLE IX - SUPPLEMENTAL AGREEMENTS

Section 9.01.   Supplemental Agreements Without Consent of
                Certificateholders.....................................       44
Section 9.02.   Supplemental Agreements with Consent of
                Certificateholders.....................................       45
Section 9.03.   Documents Affecting Immunity or Indemnity..............       46
Section 9.04.   Execution of Supplemental Agreements...................       47
Section 9.05.   Effect of Supplemental Agreements......................       47
Section 9.06.   Conformity with Trust Indenture Act....................       47
Section 9.07.   Reference in Certificates to Supplemental Agreements...       47

             ARTICLE X - AMENDMENTS TO INDENTURE AND NOTE DOCUMENTS

Section 10.01.  Amendments and Supplements to Indenture and Other
                Note Documents.........................................       47

                       ARTICLE XI - TERMINATION OF TRUSTS

Section 11.01.  Termination of the Trusts..............................       48

                     ARTICLE XII - MISCELLANEOUS PROVISIONS

Section 12.01.  Limitation on Rights of Certificateholders.............       49
Section 12.02.  Liabilities of Certificateholders......................       50
Section 12.03.  Registration of Equipment Notes in Name of
                Subordination Agent....................................       50
Section 12.04.  Notices................................................       50
Section 12.05.  Governing Law..........................................       51
Section 12.06.  Severability of Provisions.............................       51
Section 12.07.  Trust Indenture Act Controls...........................       51
Section 12.08.  Effect of Headings and Table of Contents...............       51
Section 12.09.  Successors and Assigns.................................       52
Section 12.10.  Benefits of Agreement..................................       52
Section 12.11.  Legal Holidays.........................................       52
Section 12.12.  Counterparts...........................................       52
Section 12.13.  Communication by Certificateholders with Other
                Certificateholders.....................................       52
Section 12.14.  Intention of Parties...................................       52

                                    EXHIBITS

Exhibit A   Form of Certificate

</TABLE>



<PAGE>

Reconciliation  and  tie  between   Continental   Airlines  Pass  Through  Trust
Agreement,  dated as of September 25, 1997 and the Trust  Indenture Act of 1939.
This  reconciliation  does  not  constitute  part  of  the  Pass  Through  Trust
Agreement.


<TABLE>
<CAPTION>

                 Trust Indenture Act               Pass Through Trust
                   of 1939 Section                  Agreement Section
                   ---------------                  -----------------
             <S>                                      <C>
             310(a)(1)                                7.07
                (a)(2)                                7.07
             312(a)                                   3.05; 8.01; 8.02
             313(a)                                   7.07
             314(a)                                   8.04(a) - (c)
                (a)(4)                                8.04(d)
                (c)(1)                                1.02
                (c)(2)                                1.02
                (d)(1)                                7.13; 11.01
                (d)(2)                                7.13; 11.01
                (d)(3)                                2.01
                (e)                                   1.02
             315(b)                                   7.02
             316(a)(last sentence)                    1.01(c)
                (a)(1)(A)                             6.04
                (a)(1)(B)                             6.05
                (b)                                   6.06
                (c)                                   1.04(d)
             317(a)(1)                                6.03
                (b)                                   7.13
             318(a)                                   12.05

</TABLE>



<PAGE>

                          PASS THROUGH TRUST AGREEMENT


          This PASS THROUGH TRUST AGREEMENT, dated as of September 25, 1997 (the
"BASIC AGREEMENT"),  between CONTINENTAL AIRLINES,  INC., a Delaware corporation
(the  "COMPANY"),  and WILMINGTON  TRUST COMPANY,  a Delaware trust company,  as
Trustee,  is made with  respect to the  formation  from time to time of separate
Continental  Airlines Pass Through Trusts, and the issuance from time to time of
separate series of Pass Through Certificates  representing  fractional undivided
interests in the respective Trusts.

                                   WITNESSETH:

          WHEREAS, from time to time, the Company and the Trustee may enter into
a Trust Supplement (this and certain other defined terms used herein are defined
in Section  1.01)  pursuant to which the Trustee shall declare the creation of a
separate Trust for the benefit of the Holders of the series of  Certificates  to
be issued in respect of such Trust,  and the initial Holders of the Certificates
of such series,  as the grantors of such Trust, by their respective  acceptances
of the  Certificates  of such  series,  shall join in the creation of such Trust
with the Trustee;

          WHEREAS,  all  Certificates  to be issued in respect of each  separate
Trust will be issued as a  separate  series  pursuant  to this  Agreement,  will
evidence  fractional  undivided interests in such Trust and will have no rights,
benefits or  interests  in respect of any other  separate  Trust or the property
held therein, subject, however, to the provisions of any Intercreditor Agreement
to which one or more Trusts may be a party;

          WHEREAS,  from time to time,  pursuant to the terms and  conditions of
this Agreement with respect to each separate Trust formed hereunder, the Trustee
on behalf of such Trust shall  purchase  one or more issues of  Equipment  Notes
having the same  interest rate as, and final  maturity  dates not later than the
final Regular Distribution Date of, the series of Certificates issued in respect
of such Trust and, subject to the terms of any related Intercreditor  Agreement,
shall   hold   such   Equipment   Notes  in  trust  for  the   benefit   of  the
Certificateholders of such Trust;

          WHEREAS,  to  facilitate  the  sale of  Equipment  Notes  to,  and the
purchase of Equipment Notes by, the Trustee on behalf of each Trust created from
time to time pursuant to this  Agreement,  the Company as the "ISSUER",  as such
term is defined in and solely for  purposes of the  Securities  Act of 1933,  as
amended,  of the  Certificates  to be issued in respect of each Trust and as the
"OBLIGOR",  as such term is  defined in and  solely  for  purposes  of the Trust
Indenture  Act of 1939,  as  amended,  has duly  authorized  the  execution  and
delivery of this Basic  Agreement and each Trust  Supplement with respect to all
such  Certificates  and is undertaking  to perform  certain  administrative  and
ministerial  duties  hereunder  and is  also  undertaking  to pay the  fees  and
expenses of the Trustee; and

          WHEREAS,  this Basic Agreement,  as supplemented from time to time, is
subject to the  provisions of the Trust  Indenture Act of 1939, as amended,  and
shall, to the extent applicable, be governed by such provisions;


<PAGE>

          NOW,  THEREFORE,  in  consideration  of the mutual  agreements  herein
contained, and of other good and valuable consideration the receipt and adequacy
of which are hereby acknowledged, the parties hereto agree as follows:


                                    ARTICLE I

                                   DEFINITIONS


          Section 1.01.  DEFINITIONS.  For all purposes of this Basic Agreement,
except as otherwise expressly provided or unless the context otherwise requires:

          (1) the terms used herein that are defined in this  Article I have the
     meanings assigned to them in this Article I, and include the plural as well
     as the singular;

          (2) all  other  terms  used  herein  which  are  defined  in the Trust
     Indenture Act,  either  directly or by reference  therein,  or by the rules
     promulgated  under the Trust  Indenture Act, have the meanings  assigned to
     them therein;

          (3) all references in this Basic  Agreement to designated  "ARTICLES",
     "SECTIONS",  "SUBSECTIONS"  and other  subdivisions  are to the  designated
     Articles,  Sections,  Subsections  and  other  subdivisions  of this  Basic
     Agreement;

          (4) the words  "HEREIN",  "HEREOF" and  "HEREUNDER" and other words of
     similar  import  refer to this  Basic  Agreement  as a whole and not to any
     particular Article, Section, Subsection or other subdivision;

          (5)  unless  the  context  otherwise  requires,   whenever  the  words
     "INCLUDING", "INCLUDE" or "INCLUDES" are used herein, it shall be deemed to
     be followed by the phrase "WITHOUT LIMITATION"; and

          (6) the term "THIS  AGREEMENT"  (as  distinguished  from  "THIS  BASIC
     AGREEMENT") refers,  unless the context otherwise  requires,  to this Basic
     Agreement as  supplemented  by the Trust  Supplement  creating a particular
     Trust and establishing the series of Certificates issued or to be issued in
     respect  thereof,   with  reference  to  such  Trust  and  such  series  of
     Certificates,  as this Basic  Agreement as so  supplemented  may be further
     supplemented with respect to such Trust and such series of Certificates.

          ACT: Has the meaning, with respect to any Certificateholder, specified
     in Section 1.04(a).

          AFFILIATE:  Means,  with respect to any  specified  Person,  any other
     Person directly or indirectly  controlling or controlled by or under direct
     or indirect  common  control  with such  Person;  PROVIDED,  HOWEVER,  that
     neither America West Airlines,  Inc. nor any of its  subsidiaries  shall be
     deemed to be an "AFFILIATE" of the Company for purposes of this  Agreement.
     For the purposes of this definition,  "CONTROL",  when used with respect to
     any specified Person,  means the power,  directly or indirectly,  to direct


<PAGE>

     the management and policies of such Person,  whether  through the ownership
     of  voting   securities  or  by  contract  or  otherwise,   and  the  terms
     "CONTROLLING" and "CONTROLLED" have meanings correlative to the foregoing.

          AIRCRAFT:  Means one or more  aircraft,  including  engines  therefor,
     owned by or leased to the Company and securing one or more Equipment Notes.

          AUTHORIZED  AGENT:  Means,  with  respect to the  Certificates  of any
     series, any Paying Agent or Registrar for the Certificates of such series.

          BASIC AGREEMENT:  Means this Pass Through Trust Agreement, as the same
     may from time to time be  supplemented,  amended or modified,  but does not
     include any Trust Supplement.

          BOOK-ENTRY  CERTIFICATES:  Means,  with respect to the Certificates of
     any series,  a  beneficial  interest in the  Certificates  of such  series,
     ownership  and  transfers  of which shall be made  through  book entries as
     described in Section 3.05.

          BUSINESS DAY: Means,  with respect to the  Certificates of any series,
     any day other than a Saturday,  a Sunday or a day on which commercial banks
     are required or authorized to close in Houston,  Texas, New York, New York,
     or, so long as any Certificate of such series is outstanding,  the city and
     state in which the  Trustee  or any  related  Loan  Trustee  maintains  its
     Corporate Trust Office or receives and disburses funds.

          CERTIFICATE:   Means  any  one  of  the   certificates   executed  and
     authenticated  by the  Trustee,  substantially  in the  form of  Exhibit  A
     hereto.

          CERTIFICATE  ACCOUNT:  Means,  with respect to the Certificates of any
     series,  the account or accounts  created  and  maintained  for such series
     pursuant to Section 4.01(a) and the related Trust Supplement.

          CERTIFICATEHOLDER  OR HOLDER:  Means, with respect to the Certificates
     of any  series,  the Person in whose name a  Certificate  of such series is
     registered in the Register for Certificates of such series.

          CERTIFICATE  OWNER:  Means,  with respect to the  Certificates  of any
     series,  for  purposes of Section  3.05,  the Person who owns a  Book-Entry
     Certificate of such series.

          CLEARING  AGENCY:  Means an  organization  registered  as a  "clearing
     agency" pursuant to Section 17A of the Securities  Exchange Act of 1934, as
     amended.

          CLEARING  AGENCY  PARTICIPANT:  Means a broker,  dealer,  bank,  other
     financial institution or other Person for whom from time to time a Clearing
     Agency effects, directly or indirectly, book-entry transfers and pledges of
     securities deposited with the Clearing Agency.


<PAGE>

          COMPANY: Means Continental Airlines, Inc., a Delaware corporation,  or
     its successor in interest pursuant to Section 5.02, or (only in the context
     of provisions  hereof, if any, when such reference is required for purposes
     of compliance with the Trust Indenture Act) any other "obligor" (within the
     meaning of the Trust Indenture Act) with respect to the Certificates of any
     series.

          CONTROLLING  PARTY:  Means the Person entitled to act as such pursuant
     to the terms of any Intercreditor Agreement.

          CORPORATE TRUST OFFICE: Means, with respect to the Trustee or any Loan
     Trustee,  the office of such trustee in the city at which at any particular
     time its corporate trust business shall be principally administered.

          CUT-OFF DATE:  Means,  with respect to the Certificates of any series,
     the date  designated  as such in the  Trust  Supplement  establishing  such
     series.

          DEFINITIVE  CERTIFICATES:   Has  the  meaning,  with  respect  to  the
     Certificates of any series, specified in Section 3.05.

          DIRECTION: Has the meaning specified in Section 1.04(a).

          EQUIPMENT  NOTES:  Means,  with  respect  to the  Certificates  of any
     series,  all of the equipment notes issued under the Indentures  related to
     such series of Certificates.

          ERISA:  Means the Employee  Retirement Income Security Act of 1974, as
     amended from time to time, or any successor federal statute.

          ESCROW ACCOUNT:  Has the meaning,  with respect to the Certificates of
     any series, specified in Section 2.02(b).

          ESCROWED FUNDS: Has the meaning, with respect to any Trust,  specified
     in Section 2.02(b).

          EVENT OF DEFAULT:  Means,  in respect of any Trust, an Indenture Event
     of Default under any Indenture  pursuant to which  Equipment  Notes held by
     such Trust were issued.

          FRACTIONAL UNDIVIDED INTEREST: Means the fractional undivided interest
     in a Trust that is evidenced by a Certificate relating to such Trust.

          INDENTURE:  Means,  with respect to any Trust, each of the one or more
     separate  trust  indenture and security  agreements or trust  indenture and
     mortgages or similar documents  described in, or on a schedule attached to,
     the Trust Supplement and an indenture having  substantially  the same terms
     and  conditions  which  relates  to a  Substitute  Aircraft,  as each  such
     indenture may be amended or  supplemented in accordance with its respective
     terms; and "INDENTURES" means all of such agreements.


<PAGE>

          INDENTURE EVENT OF DEFAULT: Means, with respect to any Indenture,  any
     Indenture Event of Default (as such term is defined in such Indenture).

          INITIAL  REGULAR   DISTRIBUTION  DATE:  Means,  with  respect  to  the
     Certificates of any series, the first Regular  Distribution Date on which a
     Scheduled Payment is to be made.

          INTERCREDITOR AGREEMENT: Means any agreement by and among the Trustee,
     as  trustee  hereunder  with  respect  to one or more  Trusts,  one or more
     Liquidity  Providers  and a  Subordination  Agent  providing,  among  other
     things, for the distribution of payments made in respect of Equipment Notes
     held by such Trusts.

          ISSUANCE DATE:  Means, with respect to the Certificates of any series,
     the date of the issuance of such Certificates.

          LEASE:  Means any lease between an Owner Trustee,  as the lessor,  and
     the Company, as the lessee,  referred to in the related Indenture,  as such
     lease may be amended, supplemented or otherwise modified in accordance with
     its terms; and "LEASES" means all such Leases.

          LETTER OF REPRESENTATIONS:  Means, with respect to the Certificates of
     any series,  an agreement  among the  Company,  the Trustee and the initial
     Clearing Agency.

          LIQUIDITY  FACILITY:  Means,  with respect to the  Certificates of any
     series,  any  revolving  credit  agreement,  letter of  credit  or  similar
     facility  relating to the  Certificates  of such  series  between a bank or
     other  financial   institution  and  a  Subordination  Agent,  as  amended,
     replaced,   supplemented  or  otherwise  modified  from  time  to  time  in
     accordance with its terms and the terms of any Intercreditor Agreement.

          LIQUIDITY  PROVIDER:  Means,  with respect to the  Certificates of any
     series,  a bank or other  financial  institution  that  agrees to provide a
     Liquidity  Facility for the benefit of the holders of  Certificates of such
     series.

          LOAN  TRUSTEE:  Means,  with  respect  to any  Equipment  Note  or the
     Indenture  applicable thereto, the bank or trust company designated as loan
     or indenture  trustee under such Indenture,  and any successor to such Loan
     Trustee as such trustee; and "LOAN TRUSTEES" means all of the Loan Trustees
     under the Indentures.

          NOTE DOCUMENTS: Means, with respect to the Certificates of any series,
     the Equipment Notes with respect to such  Certificates and, with respect to
     such Equipment Notes, the related  Indenture,  Note Purchase Agreement and,
     if the related Aircraft is leased to the Company, the related Lease and the
     related Owner Trustee's Purchase Agreement.

          NOTE PURCHASE  AGREEMENT:  Means,  with respect to the Certificates of
     any  series,  any  note  purchase,  refunding,   participation  or  similar


<PAGE>

     agreement  providing  for,  among other  things,  the purchase of Equipment
     Notes by the Trustee on behalf of the relevant  Trust;  and "NOTE  PURCHASE
     AGREEMENTS" means all such agreements.

          OFFICER'S CERTIFICATE:  Means a certificate signed, (a) in the case of
     the Company,  by the Chairman or Vice  Chairman of the Board of  Directors,
     the President,  any Vice President or the Treasurer of the Company, signing
     alone,  or (b) in the case of the  Trustee  or an Owner  Trustee  or a Loan
     Trustee, a Responsible Officer of the Trustee or such Owner Trustee or such
     Loan Trustee, as the case may be.

          OPINION OF COUNSEL:  Means a written  opinion of legal counsel who (a)
     in the case of counsel for the  Company may be (i)a senior  attorney of the
     Company  one of whose  principal  duties is  furnishing  advice as to legal
     matters,  (ii)  Hughes  Hubbard  & Reed LLP or  (iii)  such  other  counsel
     designated by the Company and reasonably  acceptable to the Trustee and (b)
     in the case of any Owner Trustee or any Loan  Trustee,  may be such counsel
     as may be  designated  by any of them  whether  or not such  counsel  is an
     employee  of any of them,  and who shall be  reasonably  acceptable  to the
     Trustee.

          OTHER AGREEMENTS: Has the meaning specified in Section 6.01(b).

          OUTSTANDING:  When used with  respect to  Certificates  of any series,
     means,  as of the date of  determination,  all  Certificates of such series
     theretofore authenticated and delivered under this Agreement, except:

               (i)  Certificates  of such series  theretofore  cancelled  by the
          Registrar  or  delivered   to  the  Trustee  or  the   Registrar   for
          cancellation;

               (ii) All of the  Certificates of such series if money in the full
          amount  required to make the final  distribution  with respect to such
          series pursuant to Section 11.01 hereof has been theretofore deposited
          with the Trustee in trust for the Holders of the  Certificates of such
          series as provided in Section 4.01 pending  distribution of such money
          to  such   Certificateholders   pursuant  to  payment  of  such  final
          distribution payment; and

               (iii)  Certificates  of such series in exchange for or in lieu of
          which other  Certificates of such series have been  authenticated  and
          delivered pursuant to this Agreement.

          OWNER  PARTICIPANT:  Means,  with respect to any Equipment  Note,  the
     "Owner  Participant",  if any, as referred to in the Indenture  pursuant to
     which such Equipment  Note is issued and any permitted  successor or assign
     of  such  Owner  Participant;  and  "OWNER  PARTICIPANTS"  at any  time  of
     determination  means all of the Owner  Participants thus referred to in the
     Indentures.

          OWNER TRUSTEE:  Means,  with respect to any Equipment Note, the "Owner
     Trustee",  if any, as referred to in the  Indenture  pursuant to which such


<PAGE>

     Equipment  Note is issued,  not in its  individual  capacity  but solely as
     trustee;  and "OWNER TRUSTEES" means all of the Owner Trustees party to any
     of the related Indentures.

          OWNER TRUSTEE'S PURCHASE AGREEMENT:  Has the meaning,  with respect to
     the  Certificates  of any series if the  related  Aircraft is leased to the
     Company, specified therefor in the related Lease.

          PAYING AGENT:  Means,  with respect to the Certificates of any series,
     the paying agent  maintained  and  appointed for the  Certificates  of such
     series pursuant to Section 7.12.

          PERMITTED  INVESTMENTS:  Means  obligations  of the  United  States of
     America or agencies or  instrumentalities  thereof for the payment of which
     the full  faith and credit of the  United  States of  America  is  pledged,
     maturing in not more than 60 days after the date of acquisition  thereof or
     such  lesser  time as is  required  for  the  distribution  of any  Special
     Payments on a Special Distribution Date.

          PERSON:  Means any  person,  including  any  individual,  corporation,
     limited  liability  company,   partnership,   joint  venture,  association,
     joint-stock  company,  trust,  trustee,   unincorporated  organization,  or
     government or any agency or political subdivision thereof.

          POOL BALANCE: Means, with respect to the Certificates of any series as
     of any date, (i) the original  aggregate face amount of the Certificates of
     any series less (ii) the  aggregate  amount of all payments made in respect
     of such  Certificates  other than  payments  made in respect of interest or
     premium  thereon or  reimbursement  of any costs or  expenses  incurred  in
     connection therewith. The Pool Balance as of any Distribution Date shall be
     computed  after giving effect to the payment of  principal,  if any, on the
     Equipment  Notes  or  other  Trust  Property  held  in the  Trust  and  the
     distribution thereof to be made on such Distribution Date.

          POOL FACTOR:  Means,  with respect to any series of Certificates as of
     any date, the quotient  (rounded to the seventh  decimal place) computed by
     dividing  (i) the Pool  Balance of such  series as at such date by (ii) the
     original aggregate face amount of the Certificates of such series. The Pool
     Factor as of any Distribution Date shall be computed after giving effect to
     the payment of  principal,  if any, on the  Equipment  Notes or other Trust
     Property held in the Trust and the distribution  thereof to be made on such
     Distribution Date.

          POSTPONED  NOTES:  Means,  with  respect  to any Trust or the  related
     series of Certificates,  the Equipment Notes to be held in such Trust as to
     which a Postponement  Notice shall have been delivered  pursuant to Section
     2.02(b).

          POSTPONEMENT  NOTICE:  Means, with respect to any Trust or the related
     series of Certificates,  an Officer's  Certificate of the Company signed by
     an officer of the  Company  (1)  requesting  that the  Trustee  temporarily
     postpone  purchase of the related  Equipment Notes to a date later than the



<PAGE>


     Issuance Date of such series of Certificates, (2) identifying the amount of
     the purchase price of each such  Equipment Note and the aggregate  purchase
     price for all such Equipment  Notes, (3) setting forth the reasons for such
     postponement  and (4) with respect to each such Equipment Note,  either (a)
     setting or resetting a new Transfer Date (which shall be on or prior to the
     applicable  Cut-off Date) for payment by the Trustee of such purchase price
     and issuance of the related  Equipment  Note (subject to subsequent  change
     from time to time in accordance with the relevant Note Purchase Agreement),
     or (b)  indicating  that such new Transfer Date (which shall be on or prior
     to the  applicable  Cut-off Date) will be set by subsequent  written notice
     not less than one Business Day prior to such new Transfer  Date (subject to
     subsequent  change from time to time in  accordance  with the relevant Note
     Purchase Agreement).


<PAGE>

          POTENTIAL   PURCHASER:   Has  the   meaning,   with   respect  to  any
     Certificateholder, specified in Section 6.01(b).

          PTC EVENT OF DEFAULT:  Means,  with respect to the Certificates of any
     series,  any  failure  to pay  within  ten  Business  Days of the due  date
     thereof: (i) the outstanding Pool Balance of such series of Certificates on
     the  date  specified  in any  Trust  Supplement  for such  payment  or (ii)
     interest due on the  Certificates of such series on any  Distribution  Date
     (unless the related Subordination Agent shall have made an Interest Drawing
     or  Drawings  (as  defined in the related  Intercreditor  Agreement),  or a
     withdrawal or withdrawals  pursuant to a cash collateral account under such
     Intercreditor  Agreement,  with  respect  thereto  in an  aggregate  amount
     sufficient to pay such interest and shall have  distributed  such amount to
     the Trustee).

          PURCHASING  CERTIFICATEHOLDER:  Has the  meaning,  with respect to any
     Certificateholder, specified in Section 6.01(b).

          RECORD DATE: Means, with respect to any Trust or the related series of
     Certificates,  (i) for Scheduled  Payments to be distributed on any Regular
     Distribution  Date, other than the final  distribution with respect to such
     series, the 15th day (whether or not a Business Day) preceding such Regular
     Distribution  Date, and (ii) for Special  Payments to be distributed on any
     Special  Distribution  Date, other than the final distribution with respect
     to such series, the 15th day (whether or not a Business Day) preceding such
     Special Distribution Date.

          REGISTER and REGISTRAR:  Means,  each with respect to the Certificates
     of any series, the register maintained and the registrar appointed pursuant
     to Sections 3.04 and 7.12.

          REGULAR  DISTRIBUTION  DATE:  Means,  with respect to distributions of
     Scheduled  Payments  in respect of any  series of  Certificates,  each date
     designated  as such in this  Agreement,  until payment of all the Scheduled
     Payments to be made under the  Equipment  Notes held in the Trust have been
     made.


<PAGE>

          REQUEST:  Means a request by the  Company  setting  forth the  subject
     matter  of the  request  accompanied  by an  Officer's  Certificate  and an
     Opinion of Counsel as provided in Section 1.02 of this Basic Agreement.

          RESPONSIBLE  OFFICER:  Means,  with respect to any  Trustee,  any Loan
     Trustee  and  any  Owner  Trustee,  any  officer  in  the  Corporate  Trust
     Department  of the  Trustee,  Loan  Trustee  or Owner  Trustee or any other
     officer customarily  performing functions similar to those performed by the
     persons who at the time shall be such  officers,  respectively,  or to whom
     any  corporate  trust  matter is referred  because of his  knowledge of and
     familiarity with a particular subject.

          RESPONSIBLE  PARTY:  Means,  with respect to the  Certificates  of any
     series, the person designated as such in the related Trust Supplement.

          SCHEDULED PAYMENT:  Means, with respect to any Equipment Note, (i) any
     payment of  principal  or interest on such  Equipment  Note (other than any
     such  payment  which  is  not  in  fact  received  by  the  Trustee  or any
     Subordination  Agent  within five days of the date on which such payment is
     scheduled  to be made) or (ii) any payment of interest on the  Certificates
     of any series  with  funds  drawn  under the  Liquidity  Facility  for such
     series,  which  payment  represents  the  installment  of principal on such
     Equipment Note at the stated maturity of such  installment,  the payment of
     regularly scheduled interest accrued on the unpaid principal amount of such
     Equipment Note, or both; PROVIDED,  HOWEVER, that any payment of principal,
     premium,  if any, or interest  resulting from the redemption or purchase of
     any Equipment Note shall not constitute a Scheduled Payment.

          SEC:  Means the Securities  and Exchange  Commission,  as from time to
     time  constituted or created under the Securities  Exchange Act of 1934, as
     amended,  or, if at any time after the  execution of this  instrument  such
     Commission  is not  existing and  performing  the duties now assigned to it
     under the Trust Indenture Act, then the body performing such duties on such
     date.

          SELLING  CERTIFICATEHOLDER:  Has  the  meaning,  with  respect  to any
     Certificateholder, specified in Section 6.01(b).

          SPECIAL  DISTRIBUTION DATE: Means, with respect to the Certificates of
     any series,  each date on which a Special  Payment is to be  distributed as
     specified in this Agreement.

          SPECIAL  PAYMENT:  Means  (i)  any  payment  (other  than a  Scheduled
     Payment) in respect of, or any  proceeds  of, any  Equipment  Note or Trust
     Indenture Estate (as defined in each Indenture),  (ii) the amounts required
     to be  distributed  pursuant to the last  paragraph  of Section  2.02(b) or
     (iii) the amounts  required to be distributed  pursuant to the  penultimate
     paragraph of Section 2.02(b).


<PAGE>

          SPECIAL PAYMENTS  ACCOUNT:  Means, with respect to the Certificates of
     any series,  the account or accounts created and maintained for such series
     pursuant to Section 4.01(b) and the related Trust Supplement.

          SPECIFIED  INVESTMENTS:  Means,  with  respect  to any  Trust,  unless
     otherwise specified in the related Trust Supplement, (i) obligations of, or
     guaranteed by, the United States Government or agencies thereof,  (ii) 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  Investors  Service,  Inc.  or at least  A-2 or its
     equivalent  by  Standard  & Poor's  Ratings  Services,  a  division  of The
     McGraw-Hill  Companies,  Inc.,  (iii)  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 $100,000,000 which banks or their holding companies have a rating
     of A or its  equivalent by Moody's  Investors  Service,  Inc. or Standard &
     Poor's Ratings  Services,  a division of The McGraw-Hill  Companies,  Inc.;
     PROVIDED, HOWEVER, that the aggregate amount at any one time so invested in
     certificates  of deposit issued by any one bank shall not exceed 5% of such
     bank's  capital  and  surplus,   (iv)  U.S.   dollar-denominated   offshore
     certificates  of deposit  issued by, or offshore  time deposits  with,  any
     commercial  bank described in clause (iii) above or any subsidiary  thereof
     and  (v)  repurchase  agreements  with  any  financial  institution  having
     combined  capital  and  surplus  of at least  $100,000,000  with any of the
     obligations  described  in clauses  (i) through  (iv) above as  collateral;
     PROVIDED FURTHER that if all of the above investments are unavailable,  the
     entire amounts to be invested may be used to purchase federal funds from an
     entity described in clause (iii) above.

          SUBORDINATION  AGENT:  Has  the  meaning  specified  therefor  in  any
     Intercreditor Agreement.

          SUBSTITUTE AIRCRAFT: Means, with respect to any Trust, any Aircraft of
     a type  specified  in this  Agreement  and, at the election of the Company,
     substituted  prior to the applicable  Cut-off Date, if any, pursuant to the
     terms of this Agreement.

          TRANSFER  DATE:  Has the  meaning  assigned to that term or any of the
     terms "Delivery Date",  "Funding Date" or "Closing Date" in a Note Purchase
     Agreement,  and in any event  refers to any such date as it may be  changed
     from  time to time in  accordance  with  the  terms of such  Note  Purchase
     Agreement.

          TRIGGERING   EVENT:  Has  the  meaning   specified   therefor  in  any
     Intercreditor Agreement.

          TRUST:  Means,  with respect to the  Certificates  of any series,  the
     trust under this Agreement.

          TRUSTEE: Means Wilmington Trust Company, or its successor in interest,
     and any successor or other trustee appointed as provided herein.


<PAGE>


          TRUST  INDENTURE  ACT:  Except as otherwise  provided in Section 9.06,
     means,  with  respect to any  particular  Trust,  the United  States  Trust
     Indenture  Act of 1939,  as in force  at the date as of which  the  related
     Trust Supplement was executed.

          TRUST PROPERTY:  Means,  with respect to any Trust, (i) subject to any
     related Intercreditor  Agreement,  the Equipment Notes held as the property
     of such Trust,  all monies at any time paid  thereon and all monies due and
     to become due  thereunder,  (ii) funds from time to time  deposited  in the
     related Escrow  Account,  the related  Certificate  Account and the related
     Special  Payments  Account  and,  subject  to  the  related   Intercreditor
     Agreement, any proceeds from the sale by the Trustee pursuant to Article VI
     hereof of any such Equipment  Note,  (iii) all rights of such Trust and the
     Trustee,  on  behalf  of the  Trust,  under  any  Intercreditor  Agreement,
     including,  without  limitation,  all monies  receivable in respect of such
     rights,  and (iv) all monies  receivable  under any Liquidity  Facility for
     such Trust.

          TRUST SUPPLEMENT:  Means an agreement  supplemental hereto pursuant to
     which (i) a separate Trust is created for the benefit of the Holders of the
     Certificates  of a series,  (ii) the issuance of the  Certificates  of such
     series  representing  fractional  undivided  interests  in  such  Trust  is
     authorized  and (iii)  the terms of the  Certificates  of such  series  are
     established.

          Section  1.02.   COMPLIANCE   CERTIFICATES  AND  OPINIONS.   Upon  any
application or request by the Company,  any Owner Trustee or any Loan Trustee to
the Trustee to take any action under any  provision of this Basic  Agreement or,
in respect of the Certificates of any series, this Agreement,  the Company, such
Owner  Trustee or such Loan  Trustee,  as the case may be, shall  furnish to the
Trustee  (i) an  Officer's  Certificate  stating  that,  in the  opinion  of the
signers, all conditions precedent,  if any, provided for in this Basic Agreement
or this  Agreement  relating to the proposed  action have been complied with and
(ii) an Opinion of Counsel  stating that in the opinion of such counsel all such
conditions  precedent,  if any, have been complied with, except that in the case
of any such  application or request as to which the furnishing of such documents
is  specifically  required  by any  provision  of this Basic  Agreement  or this
Agreement  relating to such  particular  application  or request,  no additional
certificate or opinion need be furnished.

          Every  certificate  or  opinion  with  respect  to  compliance  with a
condition or covenant provided for in this Basic Agreement or, in respect of the
Certificates of any series,  this Agreement  (other than a certificate  provided
pursuant to Section 8.04(d)) or any Trust Supplement shall include:

          (1) a statement  that each  individual  signing  such  certificate  or
     opinion has read such  covenant or condition  and the  definitions  in this
     Basic Agreement or this Agreement relating thereto;

          (2) a brief statement as to the nature and scope of the examination or
     investigation  upon which the  statements  or  opinions  contained  in such
     certificate or opinion are based;


<PAGE>

          (3) a statement that, in the opinion of each such  individual,  he has
     made such  examination  or  investigation  as is necessary to enable him to
     express an informed opinion as to whether or not such covenant or condition
     has been complied with; and

          (4) a statement as to whether, in the opinion of each such individual,
     such condition or covenant has been complied with.

          Section  1.03.  FORM OF DOCUMENTS  DELIVERED  TO TRUSTEE.  In any case
where several  matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered  by the  opinion  of,  only one such  Person,  or that they be so
certified  or covered by only one  document,  but one such Person may certify or
give an opinion  with respect to some matters and one or more other such Persons
as to other  matters  and any such  Person may  certify or give an opinion as to
such matters in one or several documents.

          Where any Person is  required  to make,  give or  execute  two or more
applications,  requests, consents,  certificates,  statements, opinions or other
instruments under this Basic Agreement or, in respect of the Certificates of any
series,  this Agreement,  they may, but need not, be  consolidated  and form one
instrument.

          Section 1.04.  DIRECTIONS OF  CERTIFICATEHOLDERS.  (a) Any  direction,
consent, request, demand, authorization, notice, waiver or other action provided
by this  Agreement in respect of the  Certificates  of any series to be given or
taken by  Certificateholders (a "DIRECTION") may be embodied in and evidenced by
one  or  more  instruments  of  substantially   similar  tenor  signed  by  such
Certificateholders  in person or by an agent or proxy duly appointed in writing;
and, except as herein  otherwise  expressly  provided,  such action shall become
effective when such  instrument or instruments are delivered to the Trustee and,
when it is hereby expressly required pursuant to this Agreement,  to the Company
or any Loan Trustee.  Such  instrument or instruments  (and the action  embodied
therein and evidenced  thereby) are herein sometimes referred to as the "ACT" of
the  Certificateholders  signing  such  instrument  or  instruments.   Proof  of
execution of any such  instrument or of a writing  appointing  any such agent or
proxy shall be sufficient for any purpose of this Trust Agreement and conclusive
in favor of the Trustee,  the Company and the related Loan  Trustee,  if made in
the manner provided in this Section 1.04.

          (b) The fact  and  date of the  execution  by any  Person  of any such
instrument or writing may be proved by the  certificate  of any notary public or
other officer of any jurisdiction authorized to take acknowledgments of deeds or
administer oaths that the Person  executing such instrument  acknowledged to him
the execution  thereof,  or by an affidavit of a witness to such execution sworn
to before any such notary or such other officer,  and where such execution is by
an officer of a corporation  or  association  or a member of a  partnership,  on
behalf of such  corporation,  association or  partnership,  such  certificate or
affidavit shall also constitute sufficient proof of his authority.  The fact and
date of the execution of any such instrument or writing, or the authority of the
Person  executing the same,  may also be proved in any other  reasonable  manner
which the Trustee deems sufficient.


<PAGE>


          (c) In  determining  whether the  Certificateholders  of the requisite
Fractional  Undivided  Interests of Certificates of any series  Outstanding have
given any Direction under this Agreement,  Certificates  owned by the Company or
any Affiliate  thereof shall be disregarded and deemed not to be Outstanding for
purposes of any such determination.  In determining whether the Trustee shall be
protected  in  relying  upon any such  Direction,  only  Certificates  which the
Trustee  knows  to be so  owned  shall be so  disregarded.  Notwithstanding  the
foregoing,  (i) if any such Person owns 100% of the  Certificates  of any series
Outstanding,  such  Certificates  shall not be so  disregarded,  and (ii) if any
amount  of  Certificates  of any  series so owned by any such  Person  have been
pledged in good faith, such Certificates shall not be disregarded if the pledgee
establishes  to the  satisfaction  of the Trustee the pledgee's  right so to act
with respect to such Certificates and that the pledgee is not the Company or any
Affiliate thereof.

          (d) The  Company  may, at its  option,  by  delivery  of an  Officer's
Certificate   to  the   Trustee,   set  a   record   date   to   determine   the
Certificateholders  in respect of the  Certificates  of any series,  entitled to
give any Direction.  Notwithstanding  Section 316(c) of the Trust Indenture Act,
such  record  date  shall  be  the  record  date  specified  in  such  Officer's
Certificate,  which  shall be a date not more  than 30 days  prior to the  first
solicitation  of  Certificateholders  of the  applicable  series  in  connection
therewith. If such a record date is fixed, such Direction may be given before or
after  such  record  date,  but only the  Certificateholders  of  record  of the
applicable  series at the close of  business on such record date shall be deemed
to   be   Certificateholders   for   the   purposes   of   determining   whether
Certificateholders  of the requisite  proportion of Outstanding  Certificates of
such series have  authorized or agreed or consented to such  Direction,  and for
that purpose the  Outstanding  Certificates  shall be computed as of such record
date; provided,  however,  that no such Direction by the  Certificateholders  on
such  record date shall be deemed  effective  unless it shall  become  effective
pursuant to the  provisions of this Agreement not later than one year after such
record date.

          (e) Any  Direction  by the  Holder of any  Certificate  shall bind the
Holder of every  Certificate  issued  upon the  transfer  thereof or in exchange
therefor or in lieu thereof,  whether or not notation of such  Direction is made
upon such Certificate.

          (f) Except as otherwise  provided in Section 1.04(c),  Certificates of
any  series  owned  by or  pledged  to  any  Person  shall  have  an  equal  and
proportionate   benefit  under  the  provisions  of  this   Agreement,   without
preference,  priority or  distinction as among all of the  Certificates  of such
series.


                                   ARTICLE II

                       ORIGINAL ISSUANCE OF CERTIFICATES:
                          ACQUISITION OF TRUST PROPERTY

          Section 2.01. AMOUNT UNLIMITED;  ISSUABLE IN SERIES. (a) The aggregate
principal amount of Certificates  which may be authenticated and delivered under
this Basic Agreement is unlimited.  The  Certificates may be issued from time to
time in one or more  series  and  shall be  designated  generally  as the  "PASS


<PAGE>

THROUGH  CERTIFICATES",  with such further designations added or incorporated in
such title for the Certificates of each series as specified in the related Trust
Supplement.  Each  Certificate  shall  bear  upon its face  the  designation  so
selected for the series to which it belongs. All Certificates of the same series
shall be  substantially  identical  except that the Certificates of a series may
differ  as to  denomination  and as  may  otherwise  be  provided  in the  Trust
Supplement  establishing  the  Certificates  of  such  series.  Each  series  of
Certificates   issued  pursuant  to  this  Agreement  will  evidence  fractional
undivided  interests in the related Trust and, except as may be contained in any
Intercreditor  Agreement,  will have no rights, benefits or interests in respect
of any other Trust or the Trust Property held therein.  All  Certificates of the
same  series  shall be in all  respects  equally  and  ratably  entitled  to the
benefits  of this  Agreement  without  preference,  priority or  distinction  on
account of the  actual  time or times of  authentication  and  delivery,  all in
accordance with the terms and provisions of this Agreement.

          (b) The  following  matters shall be  established  with respect to the
Certificates of each series issued hereunder by a Trust Supplement  executed and
delivered by and among the Company and the Trustee:

          (1) the  formation of the Trust as to which the  Certificates  of such
     series represent  fractional undivided interests and its designation (which
     designation  shall  distinguish  such Trust from each other  Trust  created
     under this Basic Agreement and a Trust Supplement);

          (2) the specific title of the Certificates of such series (which title
     shall distinguish the Certificates of such series from each other series of
     Certificates created under this Basic Agreement and a Trust Supplement);

          (3) any limit upon the aggregate  principal amount of the Certificates
     of such series which may be authenticated  and delivered (which limit shall
     not pertain to Certificates  authenticated  and delivered upon registration
     of transfer of, or in exchange  for, or in lieu of, other  Certificates  of
     the series pursuant to Sections 3.03, 3.04 and 3.06);

          (4) the Cut-off Date with respect to the Certificates of such series;

          (5) the Regular  Distribution  Dates applicable to the Certificates of
     such series;

          (6) the Special  Distribution  Dates applicable to the Certificates of
     such series;

          (7) if other than as provided in Section 7.12(b), the Registrar or the
     Paying  Agent  for  the   Certificates   of  such  series,   including  any
     Co-Registrar or additional Paying Agent;

          (8) if other than as provided in Section 3.02,  the  denominations  in
     which the Certificates of such series shall be issuable;

          (9) if other than United  States  dollars,  the currency or currencies
     (including  currency units) in which the  Certificates of such series shall
     be denominated;


<PAGE>


          (10) the specific form of the  Certificates of such series  (including
     the interest rate  applicable  thereto) and whether or not  Certificates of
     such  series  are to be  issued as  Book-Entry  Certificates  and,  if such
     Certificates  are to be  Book-Entry  Certificates,  the form of  Letter  of
     Representations, if any (or, in the case of any Certificates denominated in
     a currency  other than United States  dollars and if other than as provided
     in Section  3.05,  whether and the  circumstances  under  which  beneficial
     owners of  interests  in such  Certificates  in  permanent  global form may
     exchange such interests for  Certificates  of such series and of like tenor
     of any authorized form and denomination);

          (11) a description  of the Equipment  Notes to be acquired and held in
     the related Trust and of the related Aircraft and Note Documents;

          (12)  provisions  with respect to the terms for which the  definitions
     set forth in Article I hereof or the terms of Section 11.01 hereof  require
     further specification in the related Trust Supplement;

          (13) any restrictions (including legends) in respect of ERISA;

          (14) whether such series will be subject to an Intercreditor Agreement
     and, if so, the specific designation of such Intercreditor Agreement;

          (15) whether such series will have the benefit of a Liquidity Facility
     and, if so, the specific designation of such Liquidity Facility;

          (16) whether  there will be a deposit  agreement  or other  comparable
     arrangement  prior to the delivery of one or more  Aircraft and, if so, any
     terms appropriate thereto; and

          (17) any other terms of the  Certificates  of such series (which terms
     shall not be inconsistent  with the provisions of the Trust Indenture Act),
     including  any  terms  of the  Certificates  of such  series  which  may be
     required or advisable  under United States laws or regulations or advisable
     in connection with the marketing of Certificates of the series.

          (c) At any time and from time to time after the execution and delivery
of this Basic Agreement and a Trust Supplement  forming a Trust and establishing
the terms of  Certificates  of a series,  Certificates  of such series  shall be
executed,  authenticated  and  delivered by the Trustee to the Person or Persons
specified by the Company upon  request of the Company and upon  satisfaction  or
waiver of any conditions precedent set forth in such Trust Supplement.

          Section 2.02.  ACQUISITION OF EQUIPMENT  NOTES.  (a) Unless  otherwise
specified in the related Trust  Supplement,  on or prior to the Issuance Date of
the Certificates of a series,  the Trustee shall execute and deliver the related
Note Purchase Agreements in the form delivered to the Trustee by the Company and
shall,  subject to the respective terms thereof,  perform its obligations  under
such  Note  Purchase   Agreements.   The  Trustee  shall  issue  and  sell  such
Certificates,  in  authorized  denominations  and in such  Fractional  Undivided
Interests, so as to result in the receipt of consideration in an amount equal to
the aggregate purchase price of the Equipment Notes contemplated to be purchased
by the Trustee  under the related Note  Purchase  Agreements  and,  concurrently


<PAGE>

therewith,  the Trustee shall purchase,  pursuant to the terms and conditions of
the Note Purchase Agreements,  such Equipment Notes at a purchase price equal to
the amount of such  consideration  so  received.  Except as provided in Sections
3.03,  3.04 and 3.06  hereof,  the Trustee  shall not execute,  authenticate  or
deliver  Certificates of such series in excess of the aggregate amount specified
in this  paragraph.  The  provisions of this  Subsection  (a) are subject to the
provisions of Subsection (b) below.

          (b) If on or prior to the  Issuance  Date with  respect to a series of
Certificates  the Company  shall  deliver to the Trustee a  Postponement  Notice
relating to one or more Postponed Notes, the Trustee shall postpone the purchase
of such  Postponed  Notes and shall  deposit into an escrow  account (as to such
Trust,  the "ESCROW  ACCOUNT") to be  maintained as part of the related Trust an
amount  equal to the  purchase  price of such  Postponed  Notes  (the  "ESCROWED
FUNDS").  The portion of the  Escrowed  Funds so  deposited  with respect to any
particular  Postponed  Notes  shall be  invested  by the  Trustee at the written
direction  and  risk  of,  and for the  benefit  of,  the  Responsible  Party in
Specified  Investments  (i) maturing no later than any  scheduled  Transfer Date
relating  to such  Postponed  Notes  or (ii) if no such  Transfer  Date has been
scheduled,  maturing on the next Business Day, or (iii) if the Company has given
notice to the Trustee that such Postponed Notes will not be issued,  maturing on
the  next  applicable  Special   Distribution  Date,  if  such  investments  are
reasonably  available for purchase.  The Trustee shall make withdrawals from the
Escrow Account only as provided in this  Agreement.  Upon request of the Company
on one  or  more  occasions  and  the  satisfaction  or  waiver  of the  closing
conditions  specified in the applicable Note Purchase  Agreements on or prior to
the related  Cut-off Date, the Trustee shall  purchase the applicable  Postponed
Notes with the Escrowed Funds  withdrawn from the Escrow  Account.  The purchase
price shall equal the principal amount of such Postponed Notes.

          The Trustee  shall hold all Specified  Investments  until the maturity
thereof  and will not  sell or  otherwise  transfer  Specified  Investments.  If
Specified  Investments  held in an Escrow Account mature prior to any applicable
Transfer  Date,  any  proceeds  received  on  the  maturity  of  such  Specified
Investments (other than any earnings thereon) shall be reinvested by the Trustee
at the written  direction  and risk of, and for the benefit of, the  Responsible
Party in Specified Investments maturing as provided in the preceding paragraph.

          Any earnings on Specified  Investments  received  from time to time by
the  Trustee  shall  be  promptly  distributed  to the  Responsible  Party.  The
Responsible  Party shall pay to the Trustee for deposit to the  relevant  Escrow
Account an amount equal to any losses on such Specified Investments as incurred.
On the Initial Regular  Distribution  Date in respect of the Certificates of any
series,  the Responsible Party will pay (in immediately  available funds) to the
Trustee an amount equal to the interest that would have accrued on any Postponed
Notes with respect to such  Certificates,  if any,  purchased after the Issuance
Date if such Postponed  Notes had been purchased on the Issuance Date,  from the
Issuance Date to, but not including,  the date of the purchase of such Postponed
Notes by the Trustee.


<PAGE>

          If, in respect of the Certificates of any series, the Company notifies
the  Trustee  prior to the  Cut-off  Date that any  Postponed  Notes will not be
issued  on or prior to the  Cut-off  Date for any  reason,  on the next  Special
Distribution  Date  for  such  Certificates  occurring  not  less  than  15 days
following the date of such notice,  (i) the  Responsible  Party shall pay to the
Trustee for deposit in the related  Special  Payments  Account,  in  immediately
available  funds, an amount equal to the interest that would have accrued on the
Postponed  Notes  designated in such notice at a rate equal to the interest rate
applicable to such  Certificates  from the Issuance Date to, but not  including,
such Special  Distribution  Date and (ii) the Trustee  shall  transfer an amount
equal to that amount of Escrowed Funds that would have been used to purchase the
Postponed Notes designated in such notice and the amount paid by the Responsible
Party pursuant to the  immediately  preceding  clause (i) to the related Special
Payments  Account for  distribution  as a Special Payment in accordance with the
provisions hereof.

          If, on such  Cut-off  Date,  an  amount  equal to less than all of the
Escrowed  Funds  (other  than  Escrowed  Funds  referred  to in the  immediately
preceding paragraph) has been used to purchase Postponed Notes, on the next such
Special Distribution Date occurring not less than 15 days following such Cut-off
Date (i) the  Responsible  Party  shall pay to the  Trustee  for deposit in such
Special Payments Account, in immediately available funds, an amount equal to the
interest  that would have accrued on such  Postponed  Notes  contemplated  to be
purchased with such unused Escrowed Funds (other than Escrowed Funds referred to
in the immediately  preceding paragraph) but not so purchased at a rate equal to
the interest rate applicable to such Certificates from the Issuance Date to, but
not  including,  such  Special  Distribution  Date and (ii)  the  Trustee  shall
transfer such unused Escrowed Funds and the amount paid by the Responsible Party
pursuant  to the  immediately  preceding  clause  (i) to such  Special  Payments
Account for  distribution as a Special Payment in accordance with the provisions
hereof.

          Section 2.03.  ACCEPTANCE BY TRUSTEE. The Trustee,  upon the execution
and delivery of a Trust Supplement creating a Trust and establishing a series of
Certificates,  shall acknowledge its acceptance of all right, title and interest
in and to the Trust Property to be acquired  pursuant to Section 2.02 hereof and
the related Note  Purchase  Agreements  and shall declare that the Trustee holds
and will hold such right, title and interest for the benefit of all then present
and future Certificateholders of such series, upon the trusts herein and in such
Trust Supplement set forth. By the acceptance of each Certificate of such series
issued to it under this Agreement, each initial Holder of such series as grantor
of such Trust shall thereby join in the creation and declaration of such Trust.

          Section 2.04.  LIMITATION OF POWERS.  Each Trust shall be  constituted
solely for the purpose of making the investment in the Equipment  Notes provided
for in the  related  Trust  Supplement,  and,  except as set forth  herein,  the
Trustee shall not be authorized or empowered to acquire any other investments or
engage in any other  activities  and, in  particular,  the Trustee  shall not be
authorized  or empowered  to do anything  that would cause such Trust to fail to
qualify as a "grantor  trust" for federal  income tax  purposes  (including,  as
subject  to  this  restriction,  acquiring  any  Aircraft  (as  defined  in  the
respective  Indentures) by bidding such Equipment Notes or otherwise,  or taking
any action with respect to any such Aircraft once acquired).


<PAGE>


                                   ARTICLE III

                                THE CERTIFICATES

          Section 3.01. FORM,  DENOMINATION  AND EXECUTION OF CERTIFICATES.  The
Certificates  of each series  shall be issued in fully  registered  form without
coupons and shall be  substantially  in the form  attached  hereto as Exhibit A,
with  such  omissions,  variations  and  insertions  as are  permitted  by  this
Agreement,  and may have such letters,  numbers or other marks of identification
and such  legends or  endorsements  placed  thereon as may be required to comply
with the rules of any  securities  exchange  on which such  Certificates  may be
listed or to conform to any usage in respect  thereof,  or as may,  consistently
herewith,   be  determined  by  the  Trustee  or  the  officers  executing  such
Certificates, as evidenced by the Trustee's or respective officers' execution of
the Certificates.

          Except as provided in Section 3.05,  the  definitive  Certificates  of
such series shall be typed, printed, lithographed or engraved or produced by any
combination of these methods or may be produced in any other manner permitted by
the rules of any securities  exchange on which the  Certificates  may be listed,
all as determined by the officers executing such  Certificates,  as evidenced by
their execution of such Certificates.

          Except as  otherwise  provided in the related  Trust  Supplement,  the
Certificates of each series shall be issued in minimum  denominations  of $1,000
or integral  multiples thereof except that one Certificate of such series may be
issued in a different denomination.

          The  Certificates  of such  series  shall be executed on behalf of the
Trustee  by  manual or  facsimile  signature  of a  Responsible  Officer  of the
Trustee. Certificates of any series bearing the manual or facsimile signature of
an individual who was, at the time when such  signature was affixed,  authorized
to sign on behalf of the Trustee shall be valid and binding  obligations  of the
Trustee,  notwithstanding  that such  individual  has ceased to be so authorized
prior to the  authentication  and delivery of such  Certificates or did not hold
such office at the date of such Certificates.

          Section  3.02.  AUTHENTICATION  OF  CERTIFICATES.  (a) On the Issuance
Date, the Trustee shall duly execute,  authenticate and deliver  Certificates of
each series in authorized denominations equalling in the aggregate the aggregate
principal  amount of the  Equipment  Notes that may be  purchased by the Trustee
pursuant to the related Note  Purchase  Agreements,  and  evidencing  the entire
ownership of the related  Trust.  Thereafter,  the Trustee  shall duly  execute,
authenticate and deliver the Certificates of such series as herein provided.

          (b) No  Certificate  of any series  shall be  entitled  to any benefit
under this Agreement,  or be valid for any purpose, unless there appears on such
Certificate a certificate of authentication  substantially in the form set forth
in  Exhibit A hereto  executed  by the  Trustee  by manual  signature,  and such
certificate of authentication upon any Certificate shall be conclusive evidence,
and the only evidence,  that such  Certificate has been duly  authenticated  and
delivered  hereunder.  All Certificates of any series shall be dated the date of
their authentication.


<PAGE>

          Section 3.03. TEMPORARY  CERTIFICATES.  Until definitive  Certificates
are ready for delivery,  the Trustee  shall  execute,  authenticate  and deliver
temporary  Certificates  of each series.  Temporary  Certificates of each series
shall be substantially in the form of definitive Certificates of such series but
may have insertions, substitutions, omissions and other variations determined to
be  appropriate  by the officers  executing the temporary  Certificates  of such
series,  as evidenced  by their  execution of such  temporary  Certificates.  If
temporary  Certificates  of any  series  are  issued,  the  Trustee  will  cause
definitive  Certificates  of such  series to be  prepared  without  unreasonable
delay.  After the  preparation of definitive  Certificates  of such series,  the
temporary  Certificates  shall be exchangeable for definitive  Certificates upon
surrender of such temporary  Certificates at the office or agency of the Trustee
designated  for such purpose  pursuant to Section  7.12,  without  charge to the
Certificateholder.  Upon surrender for cancellation of any one or more temporary
Certificates,  the Trustee shall execute,  authenticate  and deliver in exchange
therefor  a like face  amount of  definitive  Certificates  of like  series,  in
authorized  denominations and of a like Fractional Undivided Interest.  Until so
exchanged,  such temporary  Certificates  shall be entitled to the same benefits
under this Agreement as definitive Certificates.

          Section  3.04.  TRANSFER AND  EXCHANGE.  The Trustee shall cause to be
kept at the  office or  agency to be  maintained  by it in  accordance  with the
provisions  of  Section  7.12 a register  (the  "REGISTER")  for each  series of
Certificates  in  which,  subject  to  such  reasonable  regulations  as it  may
prescribe,  the Trustee shall provide for the  registration  of  Certificates of
such  series and of  transfers  and  exchanges  of such  Certificates  as herein
provided. The Trustee shall initially be the registrar (the "REGISTRAR") for the
purpose of  registering  such  Certificates  of each  series and  transfers  and
exchanges of such Certificates as herein provided.

          All Certificates  issued upon any registration of transfer or exchange
of  Certificates  of any series  shall be valid  obligations  of the  applicable
Trust,  evidencing the same interest therein,  and entitled to the same benefits
under this Agreement,  as the Certificates of such series  surrendered upon such
registration of transfer or exchange.

          Upon surrender for  registration of transfer of any Certificate at the
Corporate  Trust  Office or such  other  office or  agency,  the  Trustee  shall
execute,  authenticate and deliver, in the name of the designated  transferee or
transferees,  one or  more  new  Certificates  of  like  series,  in  authorized
denominations of a like aggregate Fractional Undivided Interest.

          At the option of a  Certificateholder,  Certificates  may be exchanged
for other Certificates of like series, in authorized denominations and of a like
aggregate Fractional  Undivided Interest,  upon surrender of the Certificates to
be exchanged  at any such office or agency.  Whenever  any  Certificates  are so
surrendered for exchange,  the Trustee shall execute,  authenticate  and deliver
the Certificates that the  Certificateholder  making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of transfer
or exchange  shall be duly endorsed or  accompanied  by a written  instrument of
transfer in form  satisfactory to the Trustee and the Registrar duly executed by
the Certificateholder thereof or its attorney duly authorized in writing.


<PAGE>

          No  service  charge  shall  be  made  to a  Certificateholder  for any
registration  of transfer or exchange  of  Certificates,  but the Trustee  shall
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.  All
Certificates  surrendered  for  registration  of transfer  or exchange  shall be
cancelled and subsequently destroyed by the Trustee.

          Section  3.05.  BOOK-ENTRY  AND  DEFINITIVE   CERTIFICATES.   (a)  The
Certificates of any series may be issued in the form of one or more  typewritten
Certificates  representing  the Book-Entry  Certificates  of such series,  to be
delivered to The Depository Trust Company,  the initial Clearing Agency,  by, or
on behalf of,  the  Company.  In such  case,  the  Certificates  of such  series
delivered to The Depository  Trust Company shall  initially be registered on the
Register in the name of CEDE & Co., the nominee of the initial  Clearing Agency,
and no Certificate Owner will receive a definitive certificate representing such
Certificate  Owner's  interest in the  Certificates  of such  series,  except as
provided  above and in  Subsection  (d)  below.  As to the  Certificates  of any
series,  unless  and  until  definitive,   fully  registered  Certificates  (the
"DEFINITIVE CERTIFICATES") have been issued pursuant to Subsection (d) below:

          (i) the  provisions  of this  Section  3.05 shall be in full force and
     effect;

          (ii) the Company,  the Paying Agent, the Registrar and the Trustee may
     deal with the Clearing Agency  Participants for all purposes (including the
     making  of   distributions   on  the   Certificates)   as  the   authorized
     representatives of the Certificate Owners;

          (iii) to the extent that the  provisions of this Section 3.05 conflict
     with any other  provisions of this Agreement  (other than the provisions of
     any Trust Supplement  expressly  amending this Section 3.05 as permitted by
     this Basic Agreement), the provisions of this Section 3.05 shall control;

          (iv) the rights of Certificate  Owners shall be exercised only through
     the Clearing  Agency and shall be limited to those  established  by law and
     agreements   between  such  Certificate  Owners  and  the  Clearing  Agency
     Participants;  and until  Definitive  Certificates  are issued  pursuant to
     Subsection (d) below,  the Clearing Agency will make  book-entry  transfers
     among  the   Clearing   Agency   Participants   and  receive  and  transmit
     distributions  of  principal,   interest  and  premium,   if  any,  on  the
     Certificates to such Clearing Agency Participants; and

          (v) whenever this  Agreement  requires or permits  actions to be taken
     based upon instructions or directions of  Certificateholders of such series
     holding  Certificates of such series  evidencing a specified  percentage of
     the  Fractional  Undivided  Interests  in the related  Trust,  the Clearing
     Agency shall be deemed to represent such percentage only to the extent that
     it  has  received   instructions   to  such  effect  from  Clearing  Agency
     Participants owning or representing, respectively, such required percentage
     of the beneficial interest in Certificates of such series and has delivered
     such  instructions to the Trustee.  The Trustee shall have no obligation to
     determine  whether  the  Clearing  Agency  has in fact  received  any  such
     instructions.


<PAGE>

          (b) Whenever notice or other  communication to the  Certificateholders
of such series is required  under this  Agreement,  unless and until  Definitive
Certificates  shall have been  issued  pursuant  to  Subsection  (d) below,  the
Trustee shall give all such notices and  communications  specified  herein to be
given to Certificateholders of such series to the Clearing Agency.

          (c) Unless and until  Definitive  Certificates  of a series are issued
pursuant to Subsection  (d) below,  on the Record Date prior to each  applicable
Regular  Distribution  Date and Special  Distribution  Date,  the  Trustee  will
request from the Clearing Agency a securities position listing setting forth the
names of all Clearing  Agency  Participants  reflected on the Clearing  Agency's
books as holding interests in the Certificates on such Record Date.

          (d) If with respect to the  Certificates of any series (i) the Company
advises the Trustee in writing that the Clearing  Agency is no longer willing or
able to discharge properly its  responsibilities  and the Trustee or the Company
is unable to locate a  qualified  successor,  (ii) the  Company,  at its option,
advises the Trustee in writing that it elects to terminate the book-entry system
through  the  Clearing  Agency  or (iii)  after  the  occurrence  of an Event of
Default, Certificate Owners of Book-Entry Certificates of such series evidencing
Fractional Undivided Interests  aggregating not less than a majority in interest
in the related Trust, by Act of such Certificate Owners delivered to the Company
and the Trustee, advise the Company, the Trustee and the Clearing Agency through
the  Clearing  Agency  Participants  in  writing  that  the  continuation  of  a
book-entry  system through the Clearing Agency  Participants is no longer in the
best interests of the Certificate Owners of such series,  then the Trustee shall
notify all Certificate  Owners of such series,  through the Clearing Agency,  of
the  occurrence  of  any  such  event  and  of the  availability  of  Definitive
Certificates.  Upon  surrender  to the Trustee of all the  Certificates  of such
series held by the Clearing  Agency,  accompanied by  registration  instructions
from  the  Clearing   Agency   Participants   for   registration  of  Definitive
Certificates  in the names of  Certificate  Owners of such  series,  the Trustee
shall issue and deliver the Definitive Certificates of such series in accordance
with  the  instructions  of  the  Clearing  Agency.  Neither  the  Company,  the
Registrar,  the Paying  Agent nor the  Trustee  shall be liable for any delay in
delivery  of such  instructions  and may  conclusively  rely  on,  and  shall be
protected in relying on, such  registration  instructions.  Upon the issuance of
Definitive  Certificates of such series,  the Trustee shall recognize the Person
in whose name the  Definitive  Certificates  are  registered  in the Register as
Certificateholders  hereunder.  Neither the  Company  nor the  Trustee  shall be
liable if the Trustee or the  Company is unable to locate a qualified  successor
Clearing Agency.

          (e) Except as otherwise provided in the related Trust Supplement,  the
Trustee shall enter into the applicable Letter of  Representations  with respect
to such series of Certificates and fulfill its responsibilities thereunder.

          (f) The  provisions of this Section 3.05 may be made  inapplicable  to
any series or may be amended  with  respect to any series in the  related  Trust
Supplement.

          Section 3.06. MUTILATED,  DESTROYED,  LOST OR STOLEN CERTIFICATES.  If
(a) any mutilated Certificate is surrendered to the Registrar,  or the Registrar


<PAGE>

receives  evidence to its satisfaction of the destruction,  loss or theft of any
Certificate,  and (b) there is delivered to the  Registrar  and the Trustee such
security,  indemnity  or bond,  as may be  required by them to save each of them
harmless,  then,  in the absence of notice to the  Registrar or the Trustee that
such  destroyed,  lost or stolen  Certificate  has been  acquired by a BONA FIDE
purchaser, and PROVIDED,  HOWEVER, that the requirements of Section 8-405 of the
Uniform  Commercial Code in effect in any applicable  jurisdiction  are met, the
Trustee shall execute,  authenticate and deliver,  in exchange for or in lieu of
any such mutilated,  destroyed, lost or stolen Certificate, a new Certificate or
Certificates of like series, in authorized  denominations and of like Fractional
Undivided Interest and bearing a number not contemporaneously outstanding.

          In  connection  with the  issuance of any new  Certificate  under this
Section 3.06, the Trustee shall require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto and
any other  expenses  (including  the fees and  expenses  of the  Trustee and the
Registrar) connected therewith.

          Any duplicate  Certificate  issued pursuant to this Section 3.06 shall
constitute conclusive evidence of the appropriate  Fractional Undivided Interest
in the related Trust, as if originally  issued,  whether or not the lost, stolen
or destroyed Certificate shall be found at any time.

          The  provisions of this Section 3.06 are exclusive and shall  preclude
(to the  extent  lawful)  all other  rights  and  remedies  with  respect to the
replacement or payment of mutilated, destroyed, lost or stolen Certificates.

          Section 3.07.  PERSONS  DEEMED OWNERS.  Prior to due  presentment of a
Certificate  for  registration of transfer,  the Trustee,  the Registrar and any
Paying Agent may treat the Person in whose name any  Certificate  is  registered
(as of the  day of  determination)  as the  owner  of such  Certificate  for the
purpose  of  receiving  distributions  pursuant  to Article IV and for all other
purposes whatsoever,  and none of the Trustee, the Registrar or any Paying Agent
shall be affected by any notice to the contrary.

          Section 3.08.  CANCELLATION.  All Certificates surrendered for payment
or transfer or exchange shall, if surrendered to the Trustee or any agent of the
Trustee other than the Registrar, be delivered to the Registrar for cancellation
and shall promptly be cancelled by it. No Certificates shall be authenticated in
lieu of or in  exchange  for any  Certificates  cancelled  as  provided  in this
Section 3.08,  except as expressly  permitted by this  Agreement.  All cancelled
Certificates  held by the Registrar  shall be destroyed and a  certification  of
their destruction delivered to the Trustee.

          Section 3.09.  LIMITATION OF LIABILITY FOR PAYMENTS.  All payments and
distributions  made  to  Certificateholders  of any  series  in  respect  of the
Certificates  of such series  shall be made only from the Trust  Property of the
related  Trust and only to the extent  that the  Trustee  shall have  sufficient
income or proceeds from such Trust  Property to make such payments in accordance
with the terms of Article IV of this Agreement.  Each Certificateholder,  by its
acceptance of a  Certificate,  agrees that it will look solely to the income and
proceeds  from the  Trust  Property  of the  related  Trust for any  payment  or
distribution  due to  such  Certificateholder  pursuant  to the  terms  of  this


<PAGE>

Agreement  and that it will not have any recourse to the  Company,  the Trustee,
the Loan  Trustees,  the Owner  Trustees  or the Owner  Participants,  except as
otherwise expressly provided herein or in the related Intercreditor Agreement.

          The  Company  is a party to this  Agreement  solely  for  purposes  of
meeting the  requirements  of the Trust  Indenture Act, and therefore  shall not
have any right, obligation or liability hereunder (except as otherwise expressly
provided herein).


                                   ARTICLE IV

                          DISTRIBUTIONS; STATEMENTS TO
                               CERTIFICATEHOLDERS

          Section 4.01.  CERTIFICATE  ACCOUNT AND SPECIAL PAYMENTS ACCOUNT.  (a)
The Trustee shall establish and maintain on behalf of the  Certificateholders of
each series a Certificate Account as one or more non-interest-bearing  accounts.
The Trustee shall hold such Certificate  Account in trust for the benefit of the
Certificateholders  of  such  series,  and  shall  make  or  permit  withdrawals
therefrom  only as  provided  in this  Agreement.  On each day when a  Scheduled
Payment is made to the Trustee (under an Intercreditor Agreement, if applicable)
with  respect to the  Certificates  of such series,  the  Trustee,  upon receipt
thereof,  shall  immediately  deposit  the  aggregate  amount of such  Scheduled
Payment in such Certificate Account.

          (b)  The  Trustee  shall  establish  and  maintain  on  behalf  of the
Certificateholders  of each  series a Special  Payments  Account  as one or more
accounts,  which  shall be  non-interest  bearing  except as provided in Section
4.04.  The  Trustee  shall hold the  Special  Payments  Account in trust for the
benefit  of the  Certificateholders  of such  series  and  shall  make or permit
withdrawals  therefrom only as provided in this Agreement.  On each day when one
or more  Special  Payments  are  made to the  Trustee  (under  an  Intercreditor
Agreement,  if applicable) with respect to the Certificates of such series,  the
Trustee, upon receipt thereof, shall immediately deposit the aggregate amount of
such Special Payments in such Special Payments Account.

          (c)  The  Trustee  shall  present  (or,  if   applicable,   cause  the
Subordination  Agent to present) to the related Loan  Trustee of each  Equipment
Note such  Equipment  Note on the date of its stated  final  maturity or, in the
case of any  Equipment  Note which is to be  redeemed  in whole  pursuant to the
related Indenture, on the applicable redemption date under such Indenture.

          Section  4.02.  DISTRIBUTIONS  FROM  CERTIFICATE  ACCOUNT  AND SPECIAL
PAYMENTS ACCOUNT. (a) On each Regular Distribution Date with respect to a series
of Certificates  or as soon  thereafter as the Trustee has confirmed  receipt of
the payment of all or any part of the  Scheduled  Payments due on the  Equipment
Notes held (subject to the Intercreditor Agreement) in the related Trust on such
date, the Trustee shall distribute out of the applicable Certificate Account the
entire amount deposited  therein pursuant to Section 4.01(a).  There shall be so
distributed  to each  Certificateholder  of record of such  series on the Record
Date with respect to such Regular  Distribution  Date (other than as provided in
Section  11.01  concerning  the  final  distribution)  by check  mailed  to such
Certificateholder,   at   the   address   appearing   in  the   Register,   such


<PAGE>

Certificateholder's  pro rata share (based on the Fractional  Undivided Interest
in the  Trust  held  by  such  Certificateholder)  of the  total  amount  in the
applicable  Certificate  Account,  except  that,  with  respect to  Certificates
registered on the Record Date in the name of a Clearing Agency (or its nominee),
such distribution shall be made by wire transfer in immediately  available funds
to the account designated by such Clearing Agency (or such nominee).

          (b) On each  Special  Distribution  Date with  respect to any  Special
Payment with respect to a series of  Certificates  or as soon  thereafter as the
Trustee has confirmed receipt of any Special Payments due on the Equipment Notes
held (subject to the  Intercreditor  Agreement) in the related Trust or realized
upon the sale of such Equipment  Notes,  the Trustee shall distribute out of the
applicable Special Payments Account the entire amount of such applicable Special
Payment  deposited  therein  pursuant  to  Section  4.01(b).  There  shall be so
distributed  to each  Certificateholder  of record of such  series on the Record
Date with respect to such Special  Distribution  Date (other than as provided in
Section  11.01  concerning  the  final  distribution)  by check  mailed  to such
Certificateholder,   at   the   address   appearing   in  the   Register,   such
Certificateholder's  pro rata share (based on the Fractional  Undivided Interest
in the related Trust held by such  Certificateholder) of the total amount in the
applicable  Special Payments Account on account of such Special Payment,  except
that, with respect to Certificates  registered on the Record Date in the name of
a Clearing  Agency (or its  nominee),  such  distribution  shall be made by wire
transfer  in  immediately  available  funds to the  account  designated  by such
Clearing Agency (or such nominee).

          (c) The Trustee shall, at the expense of the Company,  cause notice of
each Special  Payment with respect to a series of  Certificates  to be mailed to
each  Certificateholder  of such  series at his  address  as it  appears  in the
Register.  In the event of redemption or purchase of Equipment Notes held in the
related  Trust,  such notice  shall be mailed not less than 15 days prior to the
Special Distribution Date for the Special Payment resulting from such redemption
or  purchase,  which  Special  Distribution  Date  shall  be the  date  of  such
redemption or purchase. In the event that the Trustee receives a notice from the
Company that  Postponed  Notes will not be purchased by the Trustee  pursuant to
Section  2.02,  such  notice  of  Special  Payment  shall be  mailed  as soon as
practicable  after  receipt of such  notice from the Company and shall state the
Special  Distribution  Date for such Special Payment,  which shall occur 15 days
after the date of such  notice of  Special  Payment  or (if such 15th day is not
practicable)  as soon as practicable  thereafter.  In the event that any Special
Payment is to be made pursuant to the last paragraph of Section  2.02(b) hereof,
there  shall be mailed on the Cut-off  Date (or, if such  mailing on the Cut-off
Date is not practicable,  as soon as practicable after the Cut-off Date), notice
of such Special Payment stating the Special  Distribution  Date for such Special
Payment, which shall occur 15 days after the date of such notice of such Special
Payment  (or,  if such  15th  day is not  practicable,  as  soon as  practicable
thereafter).  In the case of any other  Special  Payments,  such notice shall be
mailed  as soon as  practicable  after the  Trustee  has  confirmed  that it has
received funds for such Special Payment,  stating the Special  Distribution Date
for such Special  Payment which shall occur not less than 15 days after the date
of such  notice and as soon as  practicable  thereafter.  Notices  mailed by the
Trustee shall set forth:


<PAGE>


          (i) the Special Distribution Date and the Record Date therefor (except
     as otherwise provided in Section 11.01),

          (ii) the  amount of the  Special  Payment  (taking  into  account  any
     payment to be made by the  Company  pursuant to Section  2.02(b))  for each
     $1,000  face  amount  Certificate  and  the  amount  thereof   constituting
     principal, premium, if any, and interest,

          (iii) the reason for the Special Payment, and

          (iv) if the  Special  Distribution  Date is the same date as a Regular
     Distribution Date for the Certificates of such series,  the total amount to
     be received on such date for each $1,000 face amount Certificate.

If the amount of premium,  if any, payable upon the redemption or purchase of an
Equipment Note has not been calculated at the time that the Trustee mails notice
of a Special Payment,  it shall be sufficient if the notice sets forth the other
amounts to be  distributed  and states  that any premium  received  will also be
distributed.

          If any  redemption  of the  Equipment  Notes  held  in  any  Trust  is
cancelled,  the Trustee, as soon as possible after learning thereof, shall cause
notice thereof to be mailed to each  Certificateholder  of the related series at
its address as it appears on the Register.

          Section 4.03.  STATEMENTS TO  CERTIFICATEHOLDERS.  (a) On each Regular
Distribution Date and Special  Distribution  Date, the Trustee will include with
each distribution of a Scheduled Payment or Special Payment, as the case may be,
to  Certificateholders  of the  related  series a  statement  setting  forth the
information provided below. Such statement shall set forth (per $1,000 aggregate
principal  amount  of  Certificate  as to (i)  and  (ii)  below)  the  following
information:

          (i) the amount of such distribution  hereunder  allocable to principal
     and the amount allocable to premium, if any;

          (ii) the amount of such distribution  hereunder allocable to interest;
     and

          (iii) the Pool Balance and the Pool Factor of the related Trust.

          With respect to the Certificates  registered in the name of a Clearing
Agency or its nominee,  on the Record Date prior to each Distribution  Date, the
Trustee  will request from the  Clearing  Agency a securities  position  listing
setting forth the names of all the Clearing Agency Participants reflected on the
Clearing  Agency's books as holding interests in the Certificates on such Record
Date. On each Distribution  Date, the applicable  Trustee will mail to each such
Clearing  Agency  Participant  the  statement  described  above  and  will  make
available additional copies as requested by such Clearing Agency Participant for
forwarding to holders of interests in the Certificates.


<PAGE>

          (b) Within a reasonable  period of time after the end of each calendar
year but not later than the latest date  permitted  by law,  the  Trustee  shall
furnish  to  each  Person  who at any  time  during  such  calendar  year  was a
Certificateholder  of  record  a  statement  containing  the sum of the  amounts
determined  pursuant  to clauses  (a)(i) and (a)(ii)  above with  respect to the
related  Trust  for such  calendar  year or,  in the  event  such  Person  was a
Certificateholder  of record  during a portion of such  calendar  year,  for the
applicable  portion of such year, and such other items as are readily  available
to the  Trustee  and  which a  Certificateholder  shall  reasonably  request  as
necessary for the purpose of such Certificateholder's preparation of its federal
income tax returns.  With respect to  Certificates  registered  in the name of a
Clearing  Agency or its nominee,  such  statement  and such other items shall be
prepared on the basis of  information  supplied  to the Trustee by the  Clearing
Agency  Participants  and shall be  delivered  by the  Trustee to such  Clearing
Agency  Participants  to be available for  forwarding  by such  Clearing  Agency
Participants  to the  holders of  interests  in the  Certificates  in the manner
described in Section 4.03(a).

          Section 4.04. INVESTMENT OF SPECIAL PAYMENT MONEYS. Any money received
by the Trustee pursuant to Section 4.01(b)  representing a Special Payment which
is not  distributed on the date received shall,  to the extent  practicable,  be
invested in Permitted  Investments by the Trustee  pending  distribution of such
Special  Payment  pursuant to Section 4.02. Any investment made pursuant to this
Section 4.04 shall be in such Permitted  Investments having maturities not later
than the date that  such  moneys  are  required  to be used to make the  payment
required under Section 4.02 on the applicable Special  Distribution Date and the
Trustee shall hold any such Permitted  Investments  until maturity.  The Trustee
shall have no liability  with respect to any  investment  made  pursuant to this
Section  4.04,  other than by reason of the willful  misconduct or negligence of
the Trustee.  All income and earnings from such investments shall be distributed
on such Special Distribution Date as part of such Special Payment.


                                    ARTICLE V

                                  THE COMPANY

          Section 5.01. MAINTENANCE OF CORPORATE EXISTENCE.  The Company, at its
own cost and  expense,  will do or cause  to be done  all  things  necessary  to
preserve and keep in full force and effect its corporate  existence,  rights and
franchises,   except  as  otherwise  specifically  permitted  in  Section  5.02;
PROVIDED,  HOWEVER, that the Company shall not be required to preserve any right
or franchise if the Company shall determine that the preservation  thereof is no
longer desirable in the conduct of the business of the Company.

          Section  5.02.  CONSOLIDATION,  MERGER,  ETC.  The  Company  shall not
consolidate  with or merge into any other  corporation  or convey,  transfer  or
lease substantially all of its assets as an entirety to any Person unless:

          (a) the  corporation  formed by such  consolidation  or into which the
     Company is merged or the Person that  acquires by  conveyance,  transfer or
     lease  substantially  all of the assets of the Company as an entirety shall


<PAGE>

     be (i) organized and validly  existing  under the laws of the United States
     of  America  or any state  thereof  or the  District  of  Columbia,  (ii) a
     "citizen of the United States" as defined in 49 U.S.C. ss. 40102(a)(15), as
     amended, and (iii) a United States certificated air carrier, if and so long
     as such status is a condition  of  entitlement  to the  benefits of Section
     1110 of the Bankruptcy Reform Act of 1978, as amended (11 U.S.C. ss. 1110),
     with respect to the Leases or the Aircraft owned by the Company;

          (b) the  corporation  formed by such  consolidation  or into which the
     Company is merged or the Person which acquires by  conveyance,  transfer or
     lease  substantially  all of the assets of the Company as an entirety shall
     execute and deliver to the Trustee  applicable to the  Certificates of each
     series a duly authorized,  valid, binding and enforceable agreement in form
     and  substance  reasonably   satisfactory  to  the  Trustee  containing  an
     assumption by such successor  corporation or Person of the due and punctual
     performance  and  observance  of each  covenant  and  condition of the Note
     Documents  and of this  Agreement  applicable to the  Certificates  of each
     series to be performed or observed by the Company; and

          (c) the  Company  shall have  delivered  to the  Trustee an  Officer's
     Certificate  of the  Company  and an  Opinion  of  Counsel  of the  Company
     reasonably   satisfactory   to  the   Trustee,   each   stating  that  such
     consolidation,  merger,  conveyance,  transfer or lease and the  assumption
     agreement  mentioned  in clause (b) above comply with this Section 5.02 and
     that  all  conditions  precedent  herein  provided  for  relating  to  such
     transaction have been complied with.

          Upon any consolidation or merger, or any conveyance, transfer or lease
of  substantially  all of the assets of the Company as an entirety in accordance
with this Section  5.02,  the  successor  corporation  or Person  formed by such
consolidation  or into which the Company is merged or to which such  conveyance,
transfer or lease is made shall  succeed  to, and be  substituted  for,  and may
exercise every right and power of, the Company under this  Agreement  applicable
to the  Certificates  of each series  with the same effect as if such  successor
corporation or Person had been named as the Company herein.  No such conveyance,
transfer  or lease of  substantially  all of the  assets  of the  Company  as an
entirety shall have the effect of releasing any successor  corporation or Person
which shall have become such in the manner  prescribed in this Section 5.02 from
its liability in respect of this  Agreement and any Note Document  applicable to
the Certificates of such series to which it is a party.


                                   ARTICLE VI

                                    DEFAULT

          Section 6.01.  EVENTS OF DEFAULT.  (a) EXERCISE OF REMEDIES.  Upon the
occurrence and during the  continuation  of any Indenture Event of Default under
any Indenture,  the Trustee may (i) to the extent it is the Controlling Party at
such time (as  determined  pursuant  to the  related  Intercreditor  Agreement),
direct the  exercise  of remedies  as  provided  in such  related  Intercreditor
Agreement and (ii) if there is no related  Intercreditor  Agreement,  direct the
exercise of remedies or take other action as provided in the relevant  Indenture


<PAGE>

to the extent  that it may do so as the  holder of the  Equipment  Notes  issued
under such Indenture and held in the related Trust.

          (b)  PURCHASE  RIGHTS  OF  CERTIFICATEHOLDERS.  At any time  after the
occurrence   and  during  the   continuation   of  a  Triggering   Event,   each
Certificateholder   of  Certificates  of  certain  series  (each,  a  "POTENTIAL
PURCHASER"  and,  collectively,  the "POTENTIAL  PURCHASERS")  will have certain
rights to purchase  the  Certificates  of one or more other  series,  all as set
forth  in the  Trust  Supplement  applicable  to the  Certificates  held by such
Potential Purchaser.  The purchase price with respect to the Certificates of any
series  shall be equal to the Pool Balance of the  Certificates  of such series,
together with accrued and unpaid interest  thereon to the date of such purchase,
without  premium,  but  including  any other amounts then due and payable to the
Certificateholders   of  such   series   under  this   Agreement,   any  related
Intercreditor  Agreement  or any other Note  Document or on or in respect of the
Certificates  of such series;  PROVIDED,  HOWEVER,  that if such purchase occurs
after a Record Date,  such  purchase  price shall be reduced by the amount to be
distributed  hereunder on the related  Distribution Date (which deducted amounts
shall remain distributable to, and may be retained by, the  Certificateholder as
of such Record Date);  PROVIDED,  FURTHER, that no such purchase of Certificates
of such series shall be effective unless the purchasing Certificateholder (each,
a   "PURCHASING    CERTIFICATEHOLDER"   and,   collectively,   the   "PURCHASING
CERTIFICATEHOLDERS")  shall certify to the Trustee that  contemporaneously  with
such  purchase,  one  or  more  Purchasing  Certificateholders  are  purchasing,
pursuant  to the  terms of this  Agreement  and the  other  Agreements,  if any,
relating  to  the  Certificates  of a  series  that  are  subject  to  the  same
Intercreditor  Agreement (such other Agreements,  the "OTHER  AGREEMENTS"),  the
Certificates  of each such series that the Trust  Supplement  applicable  to the
Certificates held by the Purchasing Certificateholder specifies may be purchased
by such Purchasing Certificateholder.  Each payment of the purchase price of the
Certificates of any series shall be made to an account or accounts designated by
the Trustee and each such purchase shall be subject to the terms of this Section
6.01. By acceptance of its Certificate, each Certificateholder (each, a "SELLING
CERTIFICATEHOLDER"  and, collectively,  the "SELLING  CERTIFICATEHOLDERS")  of a
series that is subject to purchase by Potential Purchasers,  all as set forth in
the  Trust  Supplement  applicable  to the  Certificates  held  by  the  Selling
Certificateholders, agrees that, at any time after the occurrence and during the
continuance of a Triggering  Event,  it will, upon payment of the purchase price
specified herein by one or more Purchasing  Certificateholders,  forthwith sell,
assign,  transfer  and  convey  to such  Purchasing  Certificateholder  (without
recourse,  representation  or warranty of any kind except for its own acts), all
of the right, title,  interest and obligation of such Selling  Certificateholder
in this Agreement,  any related Intercreditor  Agreement,  the related Liquidity
Facility, the related Note Documents and all Certificates of such series held by
such Selling  Certificateholder  (excluding all right,  title and interest under
any of the foregoing to the extent such right, title or interest is with respect
to an obligation  not then due and payable as respects any action or inaction or
state  of   affairs   occurring   prior  to  such   sale)  and  the   Purchasing
Certificateholder   shall  assume  all  of  such   Selling   Certificateholder's
obligations  under this  Agreement,  any related  Intercreditor  Agreement,  the
related Liquidity  Facility and the related Note Documents.  The Certificates of
such series will be deemed to be  purchased  on the date payment of the purchase
price is made  notwithstanding the failure of any Selling  Certificateholder  to
deliver any Certificates of such series and, upon such a purchase,  (i) the only
rights of the Selling  Certificateholders will be to deliver the Certificates to
the  Purchasing  Certificateholder  and  receive  the  purchase  price  for such


<PAGE>

Certificates of such series and (ii) if the Purchasing  Certificateholder  shall
so  request,  such  Selling  Certificateholder  will  comply  with  all  of  the
provisions of Section 3.04 hereof to enable new  Certificates  of such series to
be issued to the Purchasing  Certificateholder in such denominations as it shall
request.  All charges and expenses in  connection  with the issuance of any such
new Certificates shall be borne by the Purchasing Certificateholder.

          Section 6.02.  INCIDENTS OF SALE OF EQUIPMENT NOTES.  Upon any sale of
all or any part of the  Equipment  Notes held in the Trust made either under the
power of sale given under this  Agreement or otherwise  for the  enforcement  of
this Agreement, the following shall be applicable:

          (1)  CERTIFICATEHOLDERS  AND TRUSTEE MAY PURCHASE EQUIPMENT NOTES. Any
     Certificateholder,  the Trustee in its  individual or any other capacity or
     any other Person may bid for and purchase any of the  Equipment  Notes held
     in the Trust, and upon compliance with the terms of sale, may hold, retain,
     possess and dispose of such  Equipment  Notes in their own  absolute  right
     without further accountability.

          (2) RECEIPT OF TRUSTEE SHALL DISCHARGE  PURCHASER.  The receipt of the
     Trustee  making such sale shall be a sufficient  discharge to any purchaser
     for his purchase money, and, after paying such purchase money and receiving
     such  receipt,  such  purchaser or its personal  representative  or assigns
     shall not be obliged to see to the  application of such purchase  money, or
     be in any way answerable for any loss,  misapplication  or  non-application
     thereof.

          (3) APPLICATION OF MONEYS RECEIVED UPON SALE. Any moneys  collected by
     the Trustee upon any sale made either under the power of sale given by this
     Agreement or  otherwise  for the  enforcement  of this  Agreement  shall be
     applied as provided in Section 4.02.

          Section 6.03. JUDICIAL PROCEEDINGS INSTITUTED BY TRUSTEE;  TRUSTEE MAY
BRING SUIT.  If there shall be a failure to make  payment of the  principal  of,
premium, if any, or interest on any Equipment Note held in the related Trust, or
if there  shall be any failure to pay Rent (as  defined in the  relevant  Lease)
under any Lease when due and payable,  then the Trustee,  in its own name and as
trustee of an express trust,  as holder of such Equipment  Notes,  to the extent
permitted  by and in  accordance  with the  terms of any  related  Intercreditor
Agreement and any related Note  Documents  (subject to rights of the  applicable
Owner Trustee or Owner Participant to cure any such failure to pay principal of,
premium,  if any,  or interest  on any  Equipment  Note or to pay Rent under any
Lease in  accordance  with the  applicable  Indenture),  shall be  entitled  and
empowered to institute any suits,  actions or  proceedings  at law, in equity or
otherwise,  for the  collection of the sums so due and unpaid on such  Equipment
Notes or under such Lease and may  prosecute  any such  claim or  proceeding  to
judgment or final  decree with  respect to the whole  amount of any such sums so
due and unpaid.

          Section 6.04. CONTROL BY  CERTIFICATEHOLDERS.  Subject to Section 6.03
and  any  related  Intercreditor  Agreement,   the  Certificateholders   holding


<PAGE>

Certificates of a series evidencing  Fractional Undivided Interests  aggregating
not less than a majority in  interest in the related  Trust shall have the right
to direct the time, method and place of conducting any proceeding for any remedy
available  to the Trustee with respect to such Trust or pursuant to the terms of
such Intercreditor  Agreement, or exercising any trust or power conferred on the
Trustee  under this  Agreement or such  Intercreditor  Agreement,  including any
right of the Trustee as Controlling Party under such Intercreditor  Agreement or
as holder of the Equipment Notes held in the related Trust;  PROVIDED,  HOWEVER,
that

          (1) such  Direction  shall not in the  opinion  of the  Trustee  be in
     conflict with any rule of law or with this  Agreement and would not involve
     the Trustee in personal liability or expense,

          (2) the Trustee shall not determine  that the action so directed would
     be unjustly prejudicial to the Certificateholders of such series not taking
     part in such Direction, and

          (3) the Trustee may take any other action deemed proper by the Trustee
     which is not inconsistent with such Direction.

          Section  6.05.  WAIVER  OF  PAST  DEFAULTS.  Subject  to  any  related
Intercreditor Agreement, the Certificateholders holding Certificates of a series
evidencing  Fractional Undivided Interests  aggregating not less than a majority
in  interest  in the Trust  (i) may on  behalf of all of the  Certificateholders
waive any past Event of Default  hereunder and its  consequences  or (ii) if the
Trustee  is the  Controlling  Party,  may direct the  Trustee  to  instruct  the
applicable  Loan Trustee to waive any past Indenture  Event of Default under any
related Indenture and its consequences, and thereby annul any Direction given by
such  Certificateholders  or the  Trustee  to such  Loan  Trustee  with  respect
thereto, except a default:

          (1) in the deposit of any Scheduled  Payment or Special  Payment under
     Section 4.01 or in the  distribution  of any payment  under Section 4.02 on
     the Certificates of a series, or

          (2) in the payment of the  principal of (premium,  if any) or interest
     on the Equipment Notes held in the related Trust, or

          (3) in respect of a covenant or provision  hereof which under  Article
     IX hereof  cannot be  modified  or  amended  without  the  consent  of each
     Certificateholder  holding an Outstanding  Certificate of a series affected
     thereby.

Upon any such  waiver,  such  default  shall cease to exist with  respect to the
Certificates of such series and any Event of Default arising  therefrom shall be
deemed to have  been  cured for every  purpose  and any  direction  given by the
Trustee on behalf of the  Certificateholders of such series to the relevant Loan
Trustee shall be annulled with respect thereto;  but no such waiver shall extend
to any  subsequent  or other  default  or Event of  Default  or impair any right
consequent  thereon.  Upon any such waiver, the Trustee shall vote the Equipment
Notes issued under the relevant  Indenture to waive the corresponding  Indenture
Event of Default.


<PAGE>

          Section 6.06. RIGHT OF  CERTIFICATEHOLDERS  TO RECEIVE PAYMENTS NOT TO
BE  IMPAIRED.  Anything  in  this  Agreement  to the  contrary  notwithstanding,
including,  without limitation,  Section 6.07 hereof, but subject to any related
Intercreditor   Agreement,   the  right  of  any  Certificateholder  to  receive
distributions  of  payments  required  pursuant  to Section  4.02  hereof on the
applicable  Certificates  when due, or to institute suit for the  enforcement of
any such payment on or after the applicable Regular Distribution Date or Special
Distribution Date, shall not be impaired or affected without the consent of such
Certificateholder.

          Section  6.07.  CERTIFICATEHOLDERS  MAY NOT BRING  SUIT  EXCEPT  UNDER
CERTAIN CONDITIONS.  A Certificateholder  of any series shall not have the right
to institute  any suit,  action or  proceeding  at law or in equity or otherwise
with respect to this  Agreement,  for the  appointment  of a receiver or for the
enforcement of any other remedy under this Agreement, unless:

          (1) such Certificateholder  previously shall have given written notice
     to the Trustee of a continuing Event of Default;

          (2) Certificateholders  holding Certificates of such series evidencing
     Fractional Undivided Interests aggregating not less than 25% of the related
     Trust shall have requested the Trustee in writing to institute such action,
     suit or  proceeding  and shall have  offered to the  Trustee  indemnity  as
     provided in Section 7.03(e);

          (3) the Trustee  shall have refused or neglected to institute any such
     action,  suit or  proceeding  for 60 days  after  receipt  of such  notice,
     request and offer of indemnity; and

          (4) no direction  inconsistent  with such written  request  shall have
     been given to the Trustee  during such 60-day period by  Certificateholders
     holding  Certificates  of  such  series  evidencing   Fractional  Undivided
     Interests  aggregating  not less than a majority in interest in the related
     Trust.

          It  is   understood   and  intended   that  no  one  or  more  of  the
Certificateholders  of any series shall have any right in any manner  whatsoever
hereunder or under the related  Trust  Supplement or under the  Certificates  of
such series to (i) surrender,  impair,  waive, affect,  disturb or prejudice any
property in the Trust Property of the related Trust,  or the lien of any related
Indenture   on  any   property   subject   thereto,   or  the   rights   of  the
Certificateholders of such series or the holders of the related Equipment Notes,
(ii) obtain or seek to obtain  priority over or  preference  with respect to any
other such  Certificateholder  of such  series or (iii)  enforce any right under
this Agreement,  except in the manner herein provided and for the equal, ratable
and common benefit of all the  Certificateholders  of such series subject to the
provisions of this Agreement.

          Section 6.08. REMEDIES CUMULATIVE. Every remedy given hereunder to the
Trustee or to any of the Certificateholders of any series shall not be exclusive
of any other remedy or remedies,  and every such remedy shall be cumulative  and
in addition to every other remedy given  hereunder or now or hereafter  given by
statute, law, equity or otherwise.


<PAGE>

          Section 6.09.  UNDERTAKING  FOR COSTS. In any suit for the enforcement
of any right or remedy under this Agreement,  or in any suit against the Trustee
for any action taken,  suffered or omitted by it as Trustee, a court may require
any party  litigant in such suit to file an undertaking to pay the costs of such
suit, and may assess costs against any such party litigant, in the manner and to
the extent provided in the Trust Indenture Act; PROVIDED,  HOWEVER, that neither
this Section 6.09 nor the Trust  Indenture  Act shall be deemed to authorize any
court to require such an  undertaking  or to make such an assessment in any suit
instituted by the Company.


                                   ARTICLE VII

                                   THE TRUSTEE

          Section 7.01. CERTAIN DUTIES AND  RESPONSIBILITIES.  (a) Except during
the  continuance  of an Event of  Default in  respect  of a Trust,  the  Trustee
undertakes  to perform such duties in respect of such Trust as are  specifically
set forth in this Agreement,  and no implied  covenants or obligations  shall be
read into this Agreement against the Trustee.

          (b) In case an Event of Default in respect of a Trust has occurred and
is  continuing,  the Trustee shall exercise such of the rights and powers vested
in it by this  Agreement  in respect of such  Trust,  and use the same degree of
care and skill in their  exercise,  as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.

          (c) No provision of this  Agreement  shall be construed to relieve the
Trustee from liability for its own negligent  action,  its own negligent failure
to act, or its own willful misconduct, except that

          (1) this  Subsection  shall not be  construed  to limit the  effect of
     Subsection (a)of this Section 7.01; and

          (2) the Trustee  shall not be liable for any error of judgment made in
     good  faith by a  Responsible  Officer of the  Trustee,  unless it shall be
     proved that the Trustee was negligent in ascertaining the pertinent facts.

          (d) Whether or not herein  expressly so provided,  every  provision of
this  Agreement  relating  to the  conduct  or  affecting  the  liability  of or
affording  protection to the Trustee shall be subject to the  provisions of this
Section 7.01.

          Section 7.02.  NOTICE OF DEFAULTS.  As promptly as practicable  after,
and in any event within 90 days after,  the  occurrence  of any default (as such
term is  defined  below)  hereunder  known to the  Trustee,  the  Trustee  shall
transmit by mail to the Company,  any related Owner Trustees,  any related Owner
Participants,  the related  Loan  Trustees  and the  Certificateholders  holding
Certificates  of the related  series in  accordance  with Section  313(c) of the
Trust  Indenture  Act,  notice of such default  hereunder  known to the Trustee,
unless such default shall have been cured or waived;  PROVIDED,  HOWEVER,  that,
except in the case of a default in the  payment of the  principal,  premium,  if
any, or interest on any  Equipment  Note,  the  Trustee  shall be  protected  in
withholding such notice if and so long as the board of directors,  the executive


<PAGE>

committee or a trust committee of directors and/or  Responsible  Officers of the
Trustee in good faith shall  determine that the withholding of such notice is in
the interests of the  Certificateholders  of the related series. For the purpose
of this Section 7.02 in respect of any Trust, the term "DEFAULT" means any event
that is, or after  notice  or lapse of time or both  would  become,  an Event of
Default in respect of that Trust.

          Section 7.03. CERTAIN RIGHTS OF TRUSTEE.  Subject to the provisions of
Section 315 of the Trust Indenture Act:

          (a) the  Trustee  may  rely  and  shall  be  protected  in  acting  or
     refraining  from  acting  in  reliance  upon any  resolution,  certificate,
     statement,   instrument,   opinion,  report,  notice,  request,  direction,
     consent,  order, bond,  debenture or other paper or document believed by it
     to be genuine and to have been signed or  presented  by the proper party or
     parties;

          (b) any request or direction of the Company  mentioned herein shall be
     sufficiently evidenced by a Request;

          (c)  whenever  in  the   administration   of  this  Agreement  or  any
     Intercreditor  Agreement, the Trustee shall deem it desirable that a matter
     be proved or established prior to taking,  suffering or omitting any action
     hereunder,  the  Trustee  (unless  other  evidence  be herein  specifically
     prescribed)  may,  in the  absence  of bad faith on its part,  rely upon an
     Officer's  Certificate  of the Company,  any related  Owner  Trustee or any
     related Loan Trustee;

          (d) the  Trustee  may  consult  with  counsel  and the  advice of such
     counsel or any Opinion of Counsel shall be full and complete  authorization
     and  protection in respect of any action  taken,  suffered or omitted by it
     hereunder in good faith and in reliance thereon;

          (e) the Trustee  shall be under no  obligation  to exercise any of the
     rights  or  powers  vested  in it by this  Agreement  or any  Intercreditor
     Agreement  at the  Direction of any of the  Certificateholders  pursuant to
     this   Agreement   or   any    Intercreditor    Agreement,    unless   such
     Certificateholders shall have offered to the Trustee reasonable security or
     indemnity  against  the  cost,  expenses  and  liabilities  which  might be
     incurred by it in compliance with such Direction;

          (f) the Trustee shall not be bound to make any investigation  into the
     facts  or  matters  stated  in  any  resolution,   certificate,  statement,
     instrument,  opinion, report, notice, request,  direction,  consent, order,
     bond, debenture or other paper or document;

          (g) the Trustee  may  execute  any of the trusts or powers  under this
     Agreement or any  Intercreditor  Agreement or perform any duties under this
     Agreement or any  Intercreditor  Agreement either directly or by or through
     agents or  attorneys,  and the  Trustee  shall not be  responsible  for any


<PAGE>

     misconduct  or  negligence  on the part of any agent or attorney  appointed
     with due care by it under this Agreement or any Intercreditor Agreement;

          (h) the Trustee  shall not be liable with  respect to any action taken
     or omitted to be taken by it in good faith in accordance with the Direction
     of the  Certificateholders  holding  Certificates of any series  evidencing
     Fractional  Undivided  Interests  aggregating  not less than a majority  in
     interest in the  related  Trust  relating to the time,  method and place of
     conducting  any  proceeding  for any remedy  available to the  Trustee,  or
     exercising  any  trust or power  conferred  upon the  Trustee,  under  this
     Agreement or any Intercreditor Agreement; and

          (i) the Trustee  shall not be required to expend or risk its own funds
     in the  performance  of any of its duties under this  Agreement,  or in the
     exercise  of any of its  rights  or  powers,  if it shall  have  reasonable
     grounds for believing  that  repayment of such funds or adequate  indemnity
     against such risk is not reasonably assured to it.

          Section   7.04.   NOT   RESPONSIBLE   FOR   RECITALS  OR  ISSUANCE  OF
CERTIFICATES.  The recitals  contained  herein and in the  Certificates  of each
series,  except the  certificates of  authentication,  shall not be taken as the
statements of the Trustee,  and the Trustee assumes no responsibility  for their
correctness. Subject to Section 7.15, the Trustee makes no representations as to
the validity or sufficiency of this Basic  Agreement,  any Equipment  Notes, any
Intercreditor Agreement, the Certificates of any series, any Trust Supplement or
any Note Documents,  except that the Trustee hereby represents and warrants that
this Basic Agreement has been, and each Trust Supplement, each Certificate, each
Note  Purchase  Agreement and each  Intercreditor  Agreement of, or relating to,
each series will be executed  and  delivered  by one of its officers who is duly
authorized to execute and deliver such document on its behalf.

          Section 7.05. MAY HOLD  CERTIFICATES.  The Trustee,  any Paying Agent,
Registrar or any of their  Affiliates  or any other agent,  in their  respective
individual  or  any  other  capacity,   may  become  the  owner  or  pledgee  of
Certificates and, subject to Sections 310(b) and 311 of the Trust Indenture Act,
if applicable,  may otherwise  deal with the Company,  any Owner Trustees or the
Loan Trustees with the same rights it would have if it were not Trustee,  Paying
Agent, Registrar or such other agent.

          Section  7.06.  MONEY HELD IN TRUST.  Money held by the Trustee or the
Paying Agent in trust under this  Agreement  need not be  segregated  from other
funds except to the extent required herein or by law and neither the Trustee nor
the Paying  Agent shall have any  liability  for  interest  upon any such moneys
except as provided for herein.

          Section 7.07. COMPENSATION AND REIMBURSEMENT. The Company agrees:

          (1) to pay,  or cause to be paid,  to the  Trustee  from  time to time
     reasonable  compensation  for all services  rendered by it hereunder (which
     compensation  shall not be limited by any provision of law in regard to the
     compensation of a trustee of an express trust); and


<PAGE>


          (2)  except as  otherwise  expressly  provided  herein or in any Trust
     Supplement,  to reimburse, or cause to be reimbursed,  the Trustee upon its
     request  for  all  reasonable  out-of-pocket  expenses,  disbursements  and
     advances  incurred or made by the Trustee in accordance  with any provision
     of  this  Basic  Agreement,  any  Trust  Supplement  or  any  Intercreditor
     Agreement  (including  the  reasonable  compensation  and the  expenses and
     disbursements  of  its  agents  and  counsel),  except  any  such  expense,
     disbursement or advance as may be  attributable to its negligence,  willful
     misconduct or bad faith or as may be incurred due to the  Trustee's  breach
     of its representations and warranties set forth in Section 7.15; and

          (3) to indemnify, or cause to be indemnified, the Trustee with respect
     to the Certificates of any series,  pursuant to the particular  sections of
     the Note Purchase Agreements specified in the related Trust Supplement.

          The Trustee shall be entitled to reimbursement  from, and shall have a
lien prior to the  Certificates of each series upon, all property and funds held
or  collected  by the Trustee in its  capacity as Trustee  with  respect to such
series or the related Trust for any tax incurred without  negligence,  bad faith
or willful  misconduct,  on its part,  arising out of or in connection  with the
acceptance or  administration  of such Trust (other than any tax attributable to
the  Trustee's  compensation  for  serving  as  such),  including  any costs and
expenses  incurred in  contesting  the  imposition  of any such tax. The Trustee
shall  notify  the  Company  of any  claim  for any tax for  which  it may  seek
reimbursement.  If the Trustee reimburses itself from the Trust Property of such
Trust for any such tax, it will mail a brief report within 30 days setting forth
the amount of such tax and the circumstances  thereof to all  Certificateholders
of such series as their names and addresses appear in the Register.

          Section 7.08.  CORPORATE  TRUSTEE  REQUIRED;  ELIGIBILITY.  Each Trust
shall at all times have a Trustee  which  shall be  eligible to act as a trustee
under  Section  310(a) of the Trust  Indenture  Act and  shall  have a  combined
capital and surplus of at least  $75,000,000 (or a combined  capital and surplus
in excess of $5,000,000 and the  obligations of which,  whether now in existence
or hereafter incurred, are fully and unconditionally guaranteed by a corporation
organized and doing business  under the laws of the United States,  any state or
territory  thereof or of the District of Columbia and having a combined  capital
and surplus of at least $75,000,000).  If such corporation  publishes reports of
conditions at least annually, pursuant to law or to the requirements of federal,
state,  territorial or District of Columbia  supervising or examining authority,
then for the purposes of this  Section 7.08 the combined  capital and surplus of
such  corporation  shall be deemed to be its combined capital and surplus as set
forth in its most recent report of conditions so published.

          In  case at any  time  the  Trustee  shall  cease  to be  eligible  in
accordance  with the  provisions  of this  Section 7.08 to act as Trustee of any
Trust,  the Trustee  shall  resign  immediately  as Trustee of such Trust in the
manner and with the effect specified in Section 7.09.

          Section 7.09. RESIGNATION AND REMOVAL;  APPOINTMENT OF SUCCESSOR.  (a)
No  resignation  or removal of the  Trustee  and no  appointment  of a successor


<PAGE>


Trustee of any Trust pursuant to this Article shall become  effective  until the
acceptance of appointment by the successor Trustee under Section 7.10.

          (b) The Trustee may resign at any time as Trustee of any or all Trusts
by giving prior written  notice thereof to the Company,  the Authorized  Agents,
the related Owner  Trustees and the related Loan  Trustees.  If an instrument of
acceptance by a successor  Trustee shall not have been delivered to the Company,
the related  Owner  Trustees and the Trustee  within 30 days after the giving of
such notice of  resignation,  the  resigning  Trustee may  petition any court of
competent jurisdiction for the appointment of a successor Trustee.

          (c)  The  Trustee  may be  removed  at any  time by  Direction  of the
Certificateholders  of  the  related  series  holding  Certificates   evidencing
Fractional Undivided Interests  aggregating not less than a majority in interest
in such Trust  delivered  to the Trustee and to the Company,  the related  Owner
Trustees and the related Loan Trustees.

          (d) If at any time in respect of any Trust:

          (1) the  Trustee  shall fail to comply  with  Section 310 of the Trust
     Indenture Act, if applicable, after written request therefor by the Company
     or by any Certificateholder who has been a BONA FIDE  Certificateholder for
     at least six months; or

          (2) the  Trustee  shall cease to be eligible  under  Section  7.08 and
     shall fail to resign after  written  request  therefor by the Company or by
     any such Certificateholder; or

          (3) the Trustee shall become  incapable of acting or shall be adjudged
     a bankrupt or  insolvent,  or a receiver of the Trustee or of its  property
     shall be  appointed or any public  officer  shall take charge or control of
     the   Trustee  or  of  its   property   or  affairs   for  the  purpose  of
     rehabilitation, conservation or liquidation;

then,  in any  case,  (i) the  Company  may  remove  the  Trustee  or  (ii)  any
Certificateholder   of  the   related   series   who  has   been  a  BONA   FIDE
Certificateholder  for at least six  months  may,  on  behalf of itself  and all
others similarly situated,  petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee of such Trust.

          (e) If a  Responsible  Officer  of the  Trustee  shall  obtain  actual
knowledge of an Avoidable  Tax (as defined  below) in respect of any Trust which
has been or is likely to be  asserted,  the Trustee  shall  promptly  notify the
Company  and shall,  within 30 days of such  notification,  resign as Trustee of
such Trust  hereunder  unless  within such 30-day  period the Trustee shall have
received  notice that the Company has agreed to pay such tax. The Company  shall
promptly appoint a successor Trustee of such Trust in a jurisdiction where there
are no Avoidable  Taxes.  As used herein,  an "AVOIDABLE TAX" in respect of such
Trust  means a state or local  tax:  (i) upon  (w) such  Trust,  (x) such  Trust
Property,  (y) Certificateholders of such Trust or (z) the Trustee for which the
Trustee is entitled to seek reimbursement from the Trust Property of such Trust,
and (ii) which would be avoided if the Trustee were located in another state, or
jurisdiction  within a state,  within the United States of America.  A tax shall


<PAGE>


not be an  Avoidable  Tax in  respect  of any Trust if the  Company or any Owner
Trustee shall agree to pay, and shall pay, such tax.

          (f) If the Trustee  shall  resign,  be removed or become  incapable of
acting as Trustee of any Trust or if a vacancy  shall occur in the office of the
Trustee  of any  Trust for any  cause,  the  Company  shall  promptly  appoint a
successor  Trustee of such Trust.  If,  within one year after such  resignation,
removal or  incapability,  or other  occurrence  of such  vacancy,  a  successor
Trustee of such Trust shall be appointed by Direction of the  Certificateholders
of the related series holding Certificates of such series evidencing  Fractional
Undivided  Interests  aggregating  not less than a majority  in interest in such
Trust  delivered to the Company,  the related Owner  Trustees,  the related Loan
Trustee and the retiring  Trustee,  then the successor  Trustee of such Trust so
appointed  shall,  with the approval of the Company of such  appointment,  which
approval shall not be  unreasonably  withheld,  forthwith upon its acceptance of
such  appointment,  become the successor Trustee of such Trust and supersede the
successor  Trustee of such Trust  appointed as provided  above.  If no successor
Trustee shall have been so appointed as provided above and accepted  appointment
in  the   manner   hereinafter   provided,   the   resigning   Trustee   or  any
Certificateholder  who has been a BONA  FIDE  Certificateholder  of the  related
series  for at least  six  months  may,  on  behalf of  himself  and all  others
similarly  situated,  petition  any  court  of  competent  jurisdiction  for the
appointment of a successor Trustee of such Trust.

          (g)  The  successor  Trustee  of a  Trust  shall  give  notice  of the
resignation and removal of the Trustee and appointment of the successor  Trustee
by mailing written notice of such event by first-class mail, postage prepaid, to
the Certificateholders of the related series as their names and addresses appear
in the Register.  Each notice shall include the name of such  successor  Trustee
and the address of its Corporate Trust Office.

          Section 7.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.  Every successor
Trustee appointed  hereunder shall execute and deliver to the Company and to the
retiring Trustee with respect to any or all Trusts an instrument  accepting such
appointment,  and thereupon the  resignation or removal of the retiring  Trustee
with respect to such Trusts shall become  effective and such successor  Trustee,
without any further act,  deed or  conveyance,  shall become vested with all the
rights,  powers,  trusts and duties of the retiring Trustee;  but, on request of
the Company or the successor  Trustee,  such retiring  Trustee shall execute and
deliver an instrument  transferring  to such successor  Trustee all such rights,
powers and trusts of the retiring  Trustee and shall duly  assign,  transfer and
deliver to such  successor  Trustee  all Trust  Property  held by such  retiring
Trustee in respect of such Trusts hereunder,  subject  nevertheless to its lien,
if any,  provided  for in  Section  7.07.  Upon  request  of any such  successor
Trustee,  the Company,  the retiring  Trustee and such  successor  Trustee shall
execute and deliver any and all instruments  containing such provisions as shall
be  necessary  or  desirable  to transfer and confirm to, and for more fully and
certainly vesting in, such successor Trustee all such rights, powers and trusts.

          If a successor  Trustee is appointed  with respect to one or more (but
not all) Trusts, the Company, the predecessor Trustee and each successor Trustee
with  respect to any Trust shall  execute and deliver a  supplemental  agreement
hereto  which shall  contain  such  provisions  as shall be deemed  necessary or


<PAGE>

desirable  to  confirm  that all the  rights,  powers,  trusts and duties of the
predecessor  Trustee  with  respect  to the  Trusts as to which the  predecessor
Trustee is not retiring shall continue to be vested in the predecessor  Trustee,
and shall add to or change any of the provisions of this Basic Agreement and the
applicable Trust  Supplements as shall be necessary to provide for or facilitate
the  administration  of the Trusts hereunder by more than one Trustee,  it being
understood  that  nothing  herein  or  in  such  supplemental   agreement  shall
constitute  such  Trustees as  co-Trustees  of the same Trust and that each such
Trustee shall be Trustee of separate Trusts.

          No institution  shall accept its  appointment  as a Trustee  hereunder
unless at the time of such  acceptance such  institution  shall be qualified and
eligible under this Article VII.

          Section  7.11.  MERGER,  CONVERSION,  CONSOLIDATION  OR  SUCCESSION TO
BUSINESS.  Any corporation  into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion  or  consolidation  to which  the  Trustee  shall be a party,  or any
corporation  succeeding  to all or  substantially  all  of the  corporate  trust
business  of the  Trustee,  shall be the  successor  of the  Trustee  hereunder;
PROVIDED,  HOWEVER,  that such  corporation  shall be  otherwise  qualified  and
eligible under this Article VII, without the execution or filing of any paper or
any  further  act  on  the  part  of any of the  parties  hereto.  In  case  any
Certificates  shall have been executed or authenticated,  but not delivered,  by
the Trustee then in office, any successor by merger, conversion or consolidation
to such  authenticating  Trustee may adopt such execution or authentication  and
deliver the Certificates so executed or authenticated with the same effect as if
such successor Trustee had itself executed or authenticated such Certificates.

          Section 7.12. MAINTENANCE OF AGENCIES. (a) With respect to each series
of  Certificates,  there shall at all times be maintained an office or agency in
the location set forth in Section 12.04 where Certificates of such series may be
presented or surrendered for  registration of transfer or for exchange,  and for
payment  thereof,  and where  notices  and  demands,  to or upon the  Trustee in
respect of such Certificates or this Agreement may be served; PROVIDED, HOWEVER,
that, if it shall be necessary that the Trustee  maintain an office or agency in
another  location  with respect to the  Certificates  of any series  (E.G.,  the
Certificates of such series shall be represented by Definitive  Certificates and
shall be listed on a national  securities  exchange),  the Trustee will make all
reasonable efforts to establish such an office or agency.  Written notice of the
location  of each such  other  office or agency  and of any  change of  location
thereof shall be given by the Trustee to the Company,  any Owner  Trustees,  the
Loan Trustees (in the case of any Owner Trustee or Loan Trustee,  at its address
specified in the Note  Documents or such other address as may be notified to the
Trustee) and the  Certificateholders  of such series.  In the event that no such
office or agency shall be  maintained or no such notice of location or of change
of location  shall be given,  presentations  and demands may be made and notices
may be served at the Corporate Trust Office of the Trustee.

          (b)  There  shall at all  times  be a  Registrar  and a  Paying  Agent
hereunder with respect to the Certificates of each series.  Each such Authorized
Agent shall be a bank or trust  company,  shall be a  corporation  organized and
doing business under the laws of the United States or any state, with a combined
capital and surplus of at least $75,000,000,  or a corporation having a combined


<PAGE>


capital  and  surplus  in excess of  $5,000,000,  the  obligations  of which are
guaranteed by a corporation  organized and doing  business under the laws of the
United  States or any state,  with a combined  capital  and  surplus of at least
$75,000,000, and shall be authorized under such laws to exercise corporate trust
powers,  subject to  supervision  by federal or state  authorities.  The Trustee
shall initially be the Paying Agent and, as provided in Section 3.04,  Registrar
hereunder with respect to the Certificates of each series.  Each Registrar shall
furnish to the Trustee,  at stated intervals of not more than six months, and at
such other times as the Trustee may request in writing,  a copy of the  Register
maintained by such Registrar.

          (c) Any corporation  into which any Authorized  Agent may be merged or
converted or with which it may be  consolidated,  or any  corporation  resulting
from any merger, consolidation or conversion to which any Authorized Agent shall
be a party, or any corporation succeeding to the corporate trust business of any
Authorized  Agent,  shall be the  successor of such  Authorized  Agent,  if such
successor corporation is otherwise eligible under this Section 7.12, without the
execution  or filing of any paper or any  further act on the part of the parties
hereto or such Authorized Agent or such successor corporation.

          (d) Any  Authorized  Agent may at any time  resign  by giving  written
notice of  resignation to the Trustee,  the Company,  any related Owner Trustees
and the  related  Loan  Trustees.  The  Company  may,  and at the request of the
Trustee  shall,  at any time  terminate  the agency of any  Authorized  Agent by
giving  written  notice  of  termination  to such  Authorized  Agent  and to the
Trustee.  Upon the resignation or termination of an Authorized  Agent or in case
at any time any such  Authorized  Agent shall  cease to be  eligible  under this
Section 7.12 (when,  in either case, no other  Authorized  Agent  performing the
functions of such Authorized Agent shall have been appointed), the Company shall
promptly appoint one or more qualified successor  Authorized Agents,  reasonably
satisfactory  to the Trustee,  to perform the functions of the Authorized  Agent
which has resigned or whose agency has been  terminated or who shall have ceased
to be eligible under this Section 7.12. The Company shall give written notice of
any such appointment  made by it to the Trustee,  any related Owner Trustees and
the related  Loan  Trustees;  and in each case the Trustee  shall mail notice of
such appointment to all  Certificateholders of the related series as their names
and addresses appear on the Register for such series.

          (e) The Company agrees to pay, or cause to be paid,  from time to time
to  each  Authorized  Agent  reasonable  compensation  for its  services  and to
reimburse it for its reasonable expenses.

          Section 7.13. MONEY FOR CERTIFICATE  PAYMENTS TO BE HELD IN TRUST. All
moneys  deposited  with any  Paying  Agent for the  purpose  of any  payment  on
Certificates  shall  be  deposited  and  held in trust  for the  benefit  of the
Certificateholders  entitled to such payment,  subject to the provisions of this
Section 7.13.  Moneys so deposited and held in trust shall constitute a separate
trust fund for the benefit of the Certificateholders  with respect to which such
money was deposited.


<PAGE>

          The  Trustee  may at any  time,  for  the  purpose  of  obtaining  the
satisfaction  and discharge of this Agreement or for any other  purpose,  direct
any Paying  Agent to pay to the  Trustee  all sums held in trust by such  Paying
Agent,  such sums to be held by the  Trustee  upon the same trusts as those upon
which such sums were held by such Paying  Agent;  and,  upon such payment by any
Paying  Agent to the  Trustee,  such Paying  Agent  shall be  released  from all
further liability with respect to such money.

          Section  7.14.  REGISTRATION  OF EQUIPMENT  NOTES IN  TRUSTEE'S  NAME.
Subject to the  provisions of any  Intercreditor  Agreement,  the Trustee agrees
that all Equipment Notes to be purchased by any Trust and Permitted Investments,
if any, shall be issued in the name of the Trustee as trustee for the applicable
Trust or its  nominee  and held by the  Trustee in trust for the  benefit of the
Certificateholders  of such  series,  or,  if not so held,  the  Trustee  or its
nominee  shall be  reflected as the owner of such  Equipment  Notes or Permitted
Investments, as the case may be, in the register of the issuer of such Equipment
Notes or Permitted Investments, as the case may be.

          Section 7.15. REPRESENTATIONS AND WARRANTIES OF TRUSTEE67. The Trustee
hereby represents and warrants that:

          (a) the  Trustee  is a  Delaware  banking  corporation  organized  and
     validly existing in good standing under the laws of the State of Delaware;

          (b) the Trustee has full power,  authority and legal right to execute,
     deliver and perform this  Agreement,  any  Intercreditor  Agreement and the
     Note Purchase  Agreements  and has taken all necessary  action to authorize
     the  execution,  delivery  and  performance  by it of this  Agreement,  any
     Intercreditor Agreement and the Note Purchase Agreements;

          (c) the  execution,  delivery and  performance  by the Trustee of this
     Agreement, any Intercreditor Agreement and the Note Purchase Agreements (i)
     will not violate any provision of any United States  federal law or the law
     of the state of the United States where it is located governing the banking
     and trust powers of the Trustee or any order, writ, judgment,  or decree of
     any court,  arbitrator or governmental  authority applicable to the Trustee
     or any of its assets,  (ii) will not violate any  provision of the articles
     of  association  or by-laws of the Trustee,  and (iii) will not violate any
     provision  of, or  constitute,  with or without  notice or lapse of time, a
     default  under,  or result in the creation or imposition of any lien on any
     properties included in the Trust Property pursuant to the provisions of any
     mortgage,  indenture,  contract, agreement or other undertaking to which it
     is a party,  which violation,  default or lien could reasonably be expected
     to have an  adverse  effect on the  Trustee's  performance  or  ability  to
     perform  its  duties   hereunder  or  thereunder  or  on  the  transactions
     contemplated herein or therein;

          (d) the  execution,  delivery and  performance  by the Trustee of this
     Agreement,  any  Intercreditor  Agreement and the Note Purchase  Agreements
     will not require the authorization,  consent, or approval of, the giving of
     notice  to,  the filing or  registration  with,  or the taking of any other


<PAGE>

     action in respect of, any  governmental  authority  or agency of the United
     States or the state of the United States where it is located regulating the
     banking and corporate trust activities of the Trustee; and

          (e) this Agreement,  any Intercreditor Agreement and the Note Purchase
Agreements  have been duly executed and delivered by the Trustee and  constitute
the legal, valid and binding agreements of the Trustee,  enforceable  against it
in  accordance   with  their   respective   terms;   PROVIDED,   HOWEVER,   that
enforceability  may  be  limited  by  (i)  applicable  bankruptcy,   insolvency,
reorganization,  moratorium  or similar laws  affecting  the rights of creditors
generally and (ii) general principles of equity.

          Section 7.16.  WITHHOLDING  TAXES;  INFORMATION  REPORTING.  As to the
Certificates of any series, the Trustee, as trustee of the related grantor trust
created by this Agreement,  shall exclude and withhold from each distribution of
principal,  premium,  if any,  and  interest  and other  amounts  due under this
Agreement or under the Certificates of such series any and all withholding taxes
applicable  thereto  as  required  by law.  The  Trustee  agrees  to act as such
withholding agent and, in connection  therewith,  whenever any present or future
taxes or similar charges are required to be withheld with respect to any amounts
payable in respect of the Certificates of such series,  to withhold such amounts
and  timely  pay the  same to the  appropriate  authority  in the name of and on
behalf of the Certificateholders of such series, that it will file any necessary
withholding  tax  returns or  statements  when due,  and that,  as  promptly  as
possible   after  the   payment   thereof,   it  will   deliver   to  each  such
Certificateholder of such series appropriate  documentation  showing the payment
thereof,   together   with  such   additional   documentary   evidence  as  such
Certificateholders  may reasonably request from time to time. The Trustee agrees
to file any other information reports as it may be required to file under United
States law.

          Section 7.17.  TRUSTEE'S LIENS. The Trustee in its individual capacity
agrees that it will, in respect of each Trust created by this Agreement,  at its
own cost and  expense  promptly  take any  action  as may be  necessary  to duly
discharge and satisfy in full any mortgage,  pledge, lien, charge,  encumbrance,
security interest or claim  ("TRUSTEE'S  LIENS") on or with respect to the Trust
Property of such Trust which is  attributable  to the Trustee  either (i) in its
individual  capacity and which is unrelated to the transactions  contemplated by
this Agreement or the related Note Documents or (ii) as Trustee  hereunder or in
its individual  capacity and which arises out of acts or omissions which are not
contemplated by this Agreement.

          Section 7.18.  PREFERENTIAL  COLLECTION  OF CLAIMS.  The Trustee shall
comply with Section 311(a) of the Trust  Indenture  Act,  excluding any creditor
relationship listed in Section 311(b) of the Trust Indenture Act. If the Trustee
shall resign or be removed as Trustee,  it shall be subject to Section 311(a) of
the Trust Indenture Act to the extent provided therein.


                                  ARTICLE VIII

                CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE

          Section 8.01. THE COMPANY TO FURNISH  TRUSTEE WITH NAMES AND ADDRESSES
OF  CERTIFICATEHOLDERS.  The Company will furnish to the Trustee  within 15 days


<PAGE>


after each Record Date with  respect to a Scheduled  Payment,  and at such other
times as the Trustee may request in writing  within 30 days after receipt by the
Company of any such request,  a list, in such form as the Trustee may reasonably
require,  of all  information  in the possession or control of the Company as to
the names and addresses of the  Certificateholders  of each series, in each case
as of a date not more than 15 days  prior to the time  such  list is  furnished;
provided,  HOWEVER,  that so long as the Trustee is the sole  Registrar for such
series, no such list need be furnished;  and PROVIDED FURTHER,  HOWEVER, that no
such  list  need be  furnished  for so long as a copy of the  Register  is being
furnished to the Trustee pursuant to Section 7.12.

          Section  8.02.   PRESERVATION   OF  INFORMATION;   COMMUNICATIONS   TO
CERTIFICATEHOLDERS.  The  Trustee  shall  preserve,  in as  current a form as is
reasonably  practicable,  the names and addresses of  Certificateholders of each
series contained in the most recent list furnished to the Trustee as provided in
Section 7.12 or Section 8.01, as the case may be, and the names and addresses of
Certificateholders  of each series  received  by the Trustee in its  capacity as
Registrar,  if so acting.  The Trustee may destroy any list  furnished  to it as
provided in Section 7.12 or Section  8.01, as the case may be, upon receipt of a
new list so furnished.

          Section 8.03. REPORTS BY TRUSTEE.  Within 60 days after May 15 of each
year commencing with the first full year following the issuance of any series of
Certificates,  the  Trustee  shall  transmit to the  Certificateholders  of such
series, as provided in Section 313(c) of the Trust Indenture Act, a brief report
dated as of such May 15, if  required by Section  313(a) of the Trust  Indenture
Act.

          Section 8.04. REPORTS BY THE COMPANY. The Company shall:

          (a) file  with the  Trustee,  within  30 days  after  the  Company  is
     required to file the same with the SEC, copies of the annual reports and of
     the information, documents and other reports (or copies of such portions of
     any of the  foregoing  as the SEC may  from  time  to  time  by  rules  and
     regulations  prescribe)  which the Company is required to file with the SEC
     pursuant to section 13 or section 15(d) of the  Securities  Exchange Act of
     1934, as amended;  or, if the Company is not required to file  information,
     documents or reports pursuant to either of such sections, then to file with
     the  Trustee  and  the  SEC,  in  accordance  with  rules  and  regulations
     prescribed by the SEC, such of the supplementary and periodic  information,
     documents and reports  which may be required  pursuant to section 13 of the
     Securities  Exchange  Act of 1934,  as  amended,  in  respect of a security
     listed  and  registered  on  a  national  securities  exchange  as  may  be
     prescribed in such rules and regulations;

          (b) file with the Trustee and the SEC,  in  accordance  with the rules
     and  regulations  prescribed  by  the  SEC,  such  additional  information,
     documents  and reports with respect to  compliance  by the Company with the
     conditions and covenants of the Company provided for in this Agreement,  as
     may be required by such rules and  regulations,  including,  in the case of
     annual reports, if required by such rules and regulations,  certificates or
     opinions of independent public accountants,  conforming to the requirements
     of Section 1.02;


<PAGE>

          (c)  transmit  to all  Certificateholders,  in the  manner  and to the
     extent provided in Section 313(c) of the Trust Indenture Act such summaries
     of any  information,  documents  and  reports  required  to be filed by the
     Company  pursuant to subsections (a) and (b) of this Section 8.04 as may be
     required by rules and regulations prescribed by the SEC; and

          (d)  furnish to the  Trustee,  not less often than  annually,  a brief
     certificate  from the  principal  executive  officer,  principal  financial
     officer  or  principal  accounting  officer  as to  his  knowledge  of  the
     Company's compliance with all conditions and covenants under this Agreement
     (it  being  understood  that  for  purposes  of this  paragraph  (d),  such
     compliance  shall be  determined  without  regard to any period of grace or
     requirement of notice provided under this Agreement).


                                   ARTICLE IX

                             SUPPLEMENTAL AGREEMENTS

          Section   9.01.    SUPPLEMENTAL    AGREEMENTS   WITHOUT   CONSENT   OF
CERTIFICATEHOLDERS.  Without the consent of the Certificateholders,  the Company
may (but will not be required  to),  and the Trustee  (subject to Section  9.03)
shall, at the Company's  request,  at any time and from time to time, enter into
one  or  more  agreements   supplemental   hereto  or,  if  applicable,   to  an
Intercreditor  Agreement or a Liquidity  Facility,  in form  satisfactory to the
Trustee, for any of the following purposes:

          (1) to provide for the formation of a Trust,  the issuance of a series
     of Certificates and other matters contemplated by Section 2.01(b); or

          (2) to evidence the  succession of another  corporation to the Company
     and the  assumption  by any such  successor of the covenants of the Company
     herein contained or of the Company's  obligations  under any  Intercreditor
     Agreement or any Liquidity Facility; or

          (3) to add to the  covenants  of the  Company  for the  benefit of the
     Certificateholders  of any  series,  or to  surrender  any  right  or power
     conferred upon the Company in this Agreement,  any Intercreditor  Agreement
     or any Liquidity Facility; or

          (4) to correct or  supplement  any  provision in this  Agreement,  any
     Intercreditor Agreement or any Liquidity Facility which may be defective or
     inconsistent  with any other  provision  herein or  therein  or to cure any
     ambiguity  or to modify  any other  provision  with  respect  to matters or
     questions arising under this Agreement,  any Intercreditor Agreement or any
     Liquidity  Facility,  PROVIDED,  HOWEVER,  that any such  action  shall not
     materially adversely affect the interests of the  Certificateholders of any
     series;  to  correct  any  mistake  in this  Agreement,  any  Intercreditor
     Agreement or any Liquidity  Facility;  or, as provided in any Intercreditor


<PAGE>

     Agreement,  to  give  effect  to or  provide  for a  Replacement  Liquidity
     Facility (as defined in such Intercreditor Agreement); or

          (5) to comply with any  requirement  of the SEC, any  applicable  law,
     rules or  regulations  of any  exchange  or  quotation  system on which the
     Certificates of any series are listed or of any regulatory body; or

          (6) to modify,  eliminate or add to the provisions of this  Agreement,
     any  Intercreditor  Agreement or any  Liquidity  Facility to such extent as
     shall be necessary to continue the  qualification  of this  Agreement,  any
     Intercreditor   Agreement  or  any  Liquidity   Facility   (including   any
     supplemental  agreement) under the Trust Indenture Act or under any similar
     Federal  statute  hereafter  enacted,  and to add to  this  Agreement,  any
     Intercreditor  Agreement or any Liquidity Facility such other provisions as
     may be expressly permitted by the Trust Indenture Act, excluding,  however,
     the provisions  referred to in Section 316(a)(2) of the Trust Indenture Act
     as in effect at the date as of which this Basic  Agreement  was executed or
     any  corresponding  provision  in any  similar  Federal  statute  hereafter
     enacted; or

          (7) to evidence and provide for the  acceptance of  appointment  under
     this Agreement,  any Intercreditor Agreement or any Liquidity Facility by a
     successor  Trustee  with  respect  to one or more  Trusts  and to add to or
     change any of the provisions of this Agreement, any Intercreditor Agreement
     or  any  Liquidity  Facility  as  shall  be  necessary  to  provide  for or
     facilitate the administration of the Trust, pursuant to the requirements of
     Section 7.10; or

          (8) to provide the information required under Section 7.12 and Section
     12.04 as to the Trustee; or

          (9) to make any other  amendments or modifications  hereto,  PROVIDED,
     HOWEVER,  that such amendments or modifications shall apply to Certificates
     of any series to be thereafter issued;

PROVIDED,  HOWEVER,  that no such supplemental  agreement shall adversely affect
the status of any Trust as a grantor trust under Subpart E, Part I of Subchapter
J of Chapter 1 of Subtitle A of the Internal  Revenue Code of 1986,  as amended,
for U.S. federal income tax purposes.

          Section    9.02.    SUPPLEMENTAL    AGREEMENTS    WITH    CONSENT   OF
CERTIFICATEHOLDERS.  With  respect  to each  separate  Trust  and the  series of
Certificates  relating  thereto,  with  the  consent  of the  Certificateholders
holding  Certificates of such series (including  consents obtained in connection
with  a  tender  offer  or  exchange  offer  for  the  Certificates)  evidencing
Fractional Undivided Interests  aggregating not less than a majority in interest
in such Trust, by Direction of said Certificateholders  delivered to the Company
and the  Trustee,  the Company may (with the consent of the Owner  Trustees,  if
any,  relating to such  Certificates,  which consent  shall not be  unreasonably
withheld),  but shall not be obligated  to, and the Trustee  (subject to Section
9.03) shall, enter into an agreement or agreements  supplemental  hereto for the
purpose of adding any provisions to or changing in any manner or eliminating any
of  the  provisions  of  this  Agreement,  any  Intercreditor  Agreement  or any


<PAGE>

Liquidity  Facility to the extent  applicable to such  Certificateholders  or of
modifying in any manner the rights and  obligations  of such  Certificateholders
under this Agreement,  any  Intercreditor  Agreement or any Liquidity  Facility;
PROVIDED,  HOWEVER,  that no such  agreement  shall,  without the consent of the
Certificateholder of each Outstanding Certificate affected thereby:

          (1)  reduce in any  manner  the amount of, or delay the timing of, any
     receipt by the  Trustee of  payments  on the  Equipment  Notes held in such
     Trust  or  distributions  that  are  required  to be  made  herein  on  any
     Certificate  of  such  series,  or  change  any  date  of  payment  on  any
     Certificate of such series,  or change the place of payment  where,  or the
     coin or currency in which,  any  Certificate of such series is payable,  or
     impair the right to institute suit for the  enforcement of any such payment
     or  distribution  on or after  the  Regular  Distribution  Date or  Special
     Distribution Date applicable thereto; or

          (2) permit the disposition of any Equipment Note included in the Trust
     Property of such Trust except as permitted by this Agreement,  or otherwise
     deprive  such  Certificateholder  of the  benefit of the  ownership  of the
     Equipment Notes in such Trust; or

          (3) alter the priority of distributions specified in the Intercreditor
     Agreement  in  a  manner  materially   adverse  to  the  interests  of  the
     Certificateholders of any series; or

          (4)  reduce  the  specified  percentage  of the  aggregate  Fractional
     Undivided   Interests   of  such  Trust  that  is  required  for  any  such
     supplemental  agreement,  or reduce such specified  percentage required for
     any waiver (of  compliance  with certain  provisions  of this  Agreement or
     certain  defaults  hereunder and their  consequences)  provided for in this
     Agreement; or

          (5) modify any of the provisions of this Section 9.02 or Section 6.05,
     except to increase any such  percentage  or to provide  that certain  other
     provisions  of this  Agreement  cannot be  modified  or waived  without the
     consent  of the  Certificateholder  of  each  Certificate  of  such  series
     affected thereby; or

          (6) adversely  affect the status of any Trust as a grantor trust under
     Subpart  E,  Part I of  Subchapter  J of  Chapter  1 of  Subtitle  A of the
     Internal  Revenue Code of 1986,  as amended,  for U.S.  federal  income tax
     purposes.

          It shall not be necessary for any Direction of such Certificateholders
under  this  Section  9.02  to  approve  the  particular  form  of any  proposed
supplemental  agreement,  but it shall be  sufficient  if such  Direction  shall
approve the substance thereof.

          Section 9.03.  DOCUMENTS AFFECTING  IMMUNITY OR  INDEMNITY.  If in the
opinion of the  Trustee any  document  required to be executed by it pursuant to
the terms of Section 9.01 or 9.02 affects any interest, right, duty, immunity or
indemnity  in favor of the  Trustee  under  this  Basic  Agreement  or any Trust
Supplement, the Trustee may in its discretion decline to execute such document.


<PAGE>

          Section 9.04. EXECUTION OF SUPPLEMENTAL  AGREEMENTS.  In executing, or
accepting the additional trusts created by, any supplemental agreement permitted
by this  Article or the  modifications  thereby  of the  trusts  created by this
Agreement,  the  Trustee  shall  be  entitled  to  receive,  and  shall be fully
protected in relying upon,  an Opinion of Counsel  stating that the execution of
such supplemental agreement is authorized or permitted by this Agreement.

          Section 9.05. EFFECT OF SUPPLEMENTAL AGREEMENTS. Upon the execution of
any agreement  supplemental  to this  Agreement  under this Article,  this Basic
Agreement  shall be  modified in  accordance  therewith,  and such  supplemental
agreement shall form a part of this Basic Agreement for all purposes;  and every
Certificateholder  of each series  theretofore or thereafter  authenticated  and
delivered  hereunder  shall be bound  thereby to the extent  applicable  to such
series.

          Section 9.06.  CONFORMITY WITH TRUST INDENTURE ACT. Every supplemental
agreement executed pursuant to this Article shall conform to the requirements of
the Trust Indenture Act as then in effect.

          Section 9.07.  REFERENCE IN CERTIFICATES  TO SUPPLEMENTAL  AGREEMENTS.
Certificates of each series  authenticated  and delivered after the execution of
any  supplemental  agreement  applicable to such series pursuant to this Article
may bear a notation in form  approved  by the Trustee as to any matter  provided
for in such supplemental agreement;  and, in such case, suitable notation may be
made upon Outstanding  Certificates of such series after proper presentation and
demand.


                                    ARTICLE X

                   AMENDMENTS TO INDENTURE AND NOTE DOCUMENTS

          Section 10.01.  AMENDMENTS AND SUPPLEMENTS TO INDENTURE AND OTHER NOTE
DOCUMENTS. In the event that the Trustee, as holder (or beneficial owner through
the Subordination  Agent) of any Equipment Notes (or as a prospective  purchaser
of any Postponed  Notes) in trust for the benefit of the  Certificateholders  of
any series or as Controlling  Party under an Intercreditor  Agreement,  receives
(directly or indirectly through the Subordination Agent) a request for a consent
to any amendment,  modification, waiver or supplement under any Indenture, other
Note Document or any other related document,  the Trustee shall forthwith send a
notice of such proposed  amendment,  modification,  waiver or supplement to each
Certificateholder  of such series  registered  on the Register as of the date of
such  notice.  The Trustee  shall  request from the  Certificateholders  of such
series a Direction  as to (a) whether or not to take or refrain  from taking (or
direct the Subordination  Agent to take or refrain from taking) any action which
a holder of (or, with respect to Postponed  Notes,  a prospective  purchaser of)
such Equipment Note or a Controlling Party has the option to direct, (b) whether
or not to give or execute (or direct the Subordination Agent to give or execute)
any waivers, consents,  amendments,  modifications or supplements as a holder of
(or, with respect to Postponed Notes, a prospective purchaser of) such Equipment
Note or as  Controlling  Party and (c) how to vote (or direct the  Subordination


<PAGE>

Agent to vote) any  Equipment  Note (or, with respect to a Postponed  Note,  its
commitment  to acquire such  Postponed  Note) if a vote has been called for with
respect thereto.  Provided such a request for Certificateholder  Direction shall
have been  made,  in  directing  any  action or  casting  any vote or giving any
consent as the holder of any Equipment  Note (or in directing the  Subordination
Agent in any of the foregoing), (i) other than as Controlling Party, the Trustee
shall vote for or give consent to any such action with respect to such Equipment
Note (or  Postponed  Note) in the same  proportion  as that of (A) the aggregate
face  amounts  of all  Certificates  actually  voted in  favor of or for  giving
consent  to such  action  by such  Direction  of  Certificateholders  to (B) the
aggregate face amount of all  Outstanding  Certificates  and (ii) as Controlling
Party, the Trustee shall vote as directed in such Certificateholder Direction by
the Certificateholders of such series evidencing a Fractional Undivided Interest
aggregating  not less than a majority in interest in the Trust.  For purposes of
the  immediately  preceding  sentence,  a Certificate  shall have been "actually
voted"  if the  Holder of such  Certificate  has  delivered  to the  Trustee  an
instrument  evidencing  such  Holder's  consent to such  Direction  prior to one
Business Day before the Trustee  directs such action or casts such vote or gives
such consent. Notwithstanding the foregoing, but subject to Section 6.04 and any
Intercreditor  Agreement,  the Trustee may, with respect to the  Certificates of
any series,  in its own discretion and at its own direction,  consent and notify
the relevant Loan Trustee of such consent (or direct the Subordination  Agent to
consent  and  notify  the  Loan  Trustee  of  such  consent)  to any  amendment,
modification,  waiver or  supplement  under any related  Indenture  or any other
related Note Document if an Event of Default  hereunder  shall have occurred and
be continuing or if such amendment,  modification, waiver or supplement will not
materially  adversely  affect the  interests of the  Certificateholders  of such
series.


                                   ARTICLE XI

                             TERMINATION OF TRUSTS

          Section  11.01.  TERMINATION  OF THE TRUSTS.  In respect of each Trust
created by the Basic Agreement as  supplemented  by a related Trust  Supplement,
the respective  obligations and  responsibilities of the Company and the Trustee
with respect to such Trust shall terminate upon the  distribution to all Holders
of  Certificates  of the  series of such Trust and the  Trustee  of all  amounts
required  to  be  distributed  to  them  pursuant  to  this  Agreement  and  the
disposition  of all property  held as part of the Trust  Property of such Trust;
PROVIDED, HOWEVER, that in no event shall such Trust continue beyond one hundred
ten (110) years following the date of the execution of the Trust Supplement with
respect to such Trust (or such other final  expiration  date as may be specified
in such Trust Supplement).

          Notice  of any  termination  of a  Trust,  specifying  the  applicable
Regular  Distribution Date (or applicable Special Distribution Date, as the case
may be) upon which the  Certificateholders  of any series  may  surrender  their
Certificates  to  the  Trustee  for  payment  of  the  final   distribution  and
cancellation,  shall be mailed promptly by the Trustee to  Certificateholders of
such series not earlier  than the minimum  number of days and not later than the
maximum  number of days  specified  therefor  in the  related  Trust  Supplement
preceding such final distribution  specifying (A) the Regular  Distribution Date
(or Special Distribution Date, as the case may be) upon which the proposed final


<PAGE>

payment of the  Certificates of such series will be made upon  presentation  and
surrender of  Certificates of such series at the office or agency of the Trustee
therein  specified,  (B) the amount of any such proposed final payment,  and (C)
that the Record Date otherwise  applicable to such Regular Distribution Date (or
Special Distribution Date, as the case may be) is not applicable, payments being
made only upon  presentation and surrender of the Certificates of such series at
the office or agency of the Trustee  therein  specified.  The Trustee shall give
such   notice  to  the   Registrar   at  the  time  such   notice  is  given  to
Certificateholders  of such  series.  Upon  presentation  and  surrender  of the
Certificates  of such series in accordance  with such notice,  the Trustee shall
cause  to  be   distributed  to   Certificateholders   of  such  series  amounts
distributable on such Regular  Distribution Date (or Special  Distribution Date,
as the case may be) pursuant to Section 4.02.

          In the event that all of the  Certificateholders  of such series shall
not surrender their  Certificates for  cancellation  within six months after the
date specified in the  above-mentioned  written notice, the Trustee shall give a
second  written  notice to the  remaining  Certificateholders  of such series to
surrender their Certificates for cancellation and receive the final distribution
with respect thereto. No additional interest shall accrue on the Certificates of
such series after any Regular  Distribution Date (or Special  Distribution Date,
as the case may be) of such series, as specified in the first written notice. In
the event that any money held by the Trustee for the payment of distributions on
the  Certificates  of such series shall remain  unclaimed for two years (or such
lesser time as the Trustee  shall be  satisfied,  after 60 days' notice from the
Company, is one month prior to the escheat period provided under applicable law)
after the final distribution date with respect thereto, the Trustee shall pay to
each Loan Trustee the appropriate  amount of money relating to such Loan Trustee
and shall give  written  notice  thereof to the related  Owner  Trustees and the
Company.


                                   ARTICLE XII

                            MISCELLANEOUS PROVISIONS

          Section 12.01.  LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.  The death
or  incapacity  of any  Certificateholder  of any  series  shall not  operate to
terminate   this   Agreement   or  the   related   Trust,   nor   entitle   such
Certificateholder's  legal representatives or heirs to claim an accounting or to
take any action or  commence  any  proceeding  in any court for a  partition  or
winding up of the Trust,  nor  otherwise  affect the  rights,  obligations,  and
liabilities of the parties hereto or any of them.

          Section  12.02.   LIABILITIES  OF   CERTIFICATEHOLDERS.   Neither  the
existence  of the Trust nor any  provision  in this  Agreement is intended to or
shall limit the liability the  Certificateholders  would  otherwise incur if the
Certificateholders   owned  Trust   Property  as  co-owners,   or  incurred  any
obligations of the Trust, directly rather than through the Trust.

          Section   12.03.   REGISTRATION   OF   EQUIPMENT   NOTES  IN  NAME  OF
SUBORDINATION  AGENT.  If a Trust is party to an  Intercreditor  Agreement,  the
Trustee  agrees that all Equipment  Notes to be purchased by such Trust shall be
issued in the name of the Subordination Agent under such Intercreditor Agreement


<PAGE>

or its nominee and held by such Subordination  Agent in trust for the benefit of
the  Certificateholders,  or, if not so held,  such  Subordination  Agent or its
nominee shall be reflected as the owner of such Equipment  Notes in the register
of the issuer of such Equipment Notes.

          Section 12.04.  NOTICES.  (a) Unless otherwise  specifically  provided
herein or in the  applicable  Trust  Supplement  with respect to any Trust,  all
notices  required under the terms and provisions of this Basic Agreement or such
Trust  Supplement with respect to such Trust shall be in English and in writing,
and any such  notice  may be given by United  States  mail,  courier  service or
telecopy,  and any such notice shall be effective when delivered or received or,
if mailed,  three days after  deposit  in the  United  States  mail with  proper
postage for ordinary mail prepaid,

          if to the Company:

               Continental Airlines, Inc.
               2929 Allen Parkway
               Houston, TX 77019
               Attention: Chief Financial Officer
                          and General Counsel
               Facsimile: (713) 523-2831

          if to the Trustee:

               Wilmington Trust Company
               Rodney Square North
               1100 North Market Street
               Wilmington, DE 19890-0001
               Attention: Corporate Trust Department
               Facsimile: (302) 651-8882
               Telephone: (302) 651-8584

          (b) The Company or the Trustee,  by notice to the other, may designate
additional or different addresses for subsequent notices or communications.

          (c) Any notice or  communication to  Certificateholders  of any series
shall be mailed by first-class mail to the addresses for  Certificateholders  of
such series shown on the Register kept by the  Registrar and to addresses  filed
with the Trustee for  Certificate  Owners of such  series.  Failure so to mail a
notice or communication or any defect in such notice or communication  shall not
affect its sufficiency with respect to other  Certificateholders  or Certificate
Owners of such series.

          (d) If a notice or  communication  is mailed  in the  manner  provided
above within the time prescribed,  it is conclusively presumed to have been duly
given, whether or not the addressee receives it.


<PAGE>

          (e)  If  the  Company   mails  a  notice  or   communication   to  the
Certificateholders  of such  series,  it shall mail a copy to the Trustee and to
each Paying Agent for such series at the same time.

          (f)  Notwithstanding  the foregoing,  all communications or notices to
the  Trustee  shall be deemed to be given only when  received  by a  Responsible
Officer of the Trustee.

          (g) The Trustee shall promptly  furnish the Company with a copy of any
demand, notice or written  communication  received by the Trustee hereunder from
any Certificateholder, Owner Trustee or Loan Trustee.

          Section 12.05.  GOVERNING LAW. THIS BASIC AGREEMENT HAS BEEN DELIVERED
IN  THE  STATE  OF NEW  YORK  AND,  TOGETHER  WITH  ALL  TRUST  SUPPLEMENTS  AND
CERTIFICATES, SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK AND THE OBLIGATIONS,  RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.

          Section 12.06.  SEVERABILITY OF PROVISIONS.  If any one or more of the
covenants,  agreements,  provisions or terms of this Agreement  shall be for any
reason whatsoever held invalid, then such covenants, agreements,  provisions, or
terms  shall be  deemed  severable  from the  remaining  covenants,  agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability  of the other  provisions of this Agreement or the related Trust,
or of the  Certificates  of such series or the rights of the  Certificateholders
thereof.

          Section 12.07. TRUST INDENTURE ACT CONTROLS. This Agreement is subject
to the  provisions  of  the  Trust  Indenture  Act  and  shall,  to  the  extent
applicable,  be governed by such provisions.  If any provision of this Agreement
limits,  qualifies or conflicts with another  provision  which is required to be
included in this Agreement by the Trust  Indenture  Act, the required  provision
shall control.

          Section 12.08. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article
and Section  headings herein and the Table of Contents are for convenience  only
and shall not affect the construction hereof.

          Section  12.09.  SUCCESSORS AND ASSIGNS.  All  covenants,  agreements,
representations  and warranties in this Agreement by the Trustee and the Company
shall bind and, to the extent  permitted  hereby,  shall inure to the benefit of
and be  enforceable  by their  respective  successors  and  assigns,  whether so
expressed or not.

          Section 12.10. BENEFITS OF AGREEMENT.  Nothing in this Agreement or in
the  Certificates of any series,  express or implied,  shall give to any Person,
other  than  the  parties  hereto  and  their  successors  hereunder,   and  the
Certificateholders  of each series, any benefit or any legal or equitable right,
remedy or claim under this Agreement.


<PAGE>


          Section  12.11.  LEGAL  HOLIDAYS.   In  any  case  where  any  Regular
Distribution  Date or Special  Distribution  Date relating to any Certificate of
any  series  shall not be a  Business  Day with  respect  to such  series,  then
(notwithstanding any other provision of this Agreement) payment need not be made
on such date, but may be made on the next succeeding  Business Day with the same
force  and  effect  as if made  on such  Regular  Distribution  Date or  Special
Distribution Date, and no interest shall accrue during the intervening period.

          Section  12.12.  COUNTERPARTS.  For the  purpose of  facilitating  the
execution  of this  Agreement  and for other  purposes,  this  Agreement  may be
executed   simultaneously   in  any  number  of  counterparts,   each  of  which
counterparts  shall be deemed to be an original,  and all of which  counterparts
shall constitute but one and the same instrument.

          Section  12.13.   COMMUNICATION  BY   CERTIFICATEHOLDERS   WITH  OTHER
CERTIFICATEHOLDERS.  Certificateholders of any series may communicate with other
Certificateholders  of such series with respect to their rights under this Basic
Agreement,  the related  Trust  Supplement  or the  Certificates  of such series
pursuant to Section 312(b) of the Trust Indenture Act. The Company,  the Trustee
and any and all  other  persons  benefitted  by this  Agreement  shall  have the
protection afforded by Section 312(c) of the Trust Indenture Act.

          Section  12.14.  INTENTION OF PARTIES.  The parties hereto intend that
each Trust be classified for U.S. federal income tax purposes as a grantor trust
under Subpart E, Part I of Subchapter J of the Internal Revenue Code of 1986, as
amended,  and not as a trust or  association  taxable as a  corporation  or as a
partnership.  The powers  granted and  obligations  undertaken  pursuant to this
Agreement shall be so construed so as to further such intent.


<PAGE>


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

                                        CONTINENTAL AIRLINES, INC.


                                        By:_____________________________________
                                           Name:
                                           Title:



                                        WILMINGTON TRUST COMPANY, as Trustee


                                        By:_____________________________________
                                           Name:
                                           Title:


<PAGE>

                                                                       EXHIBIT A

                              FORM OF CERTIFICATE



          Unless this  certificate is presented by an authorized  representative
of The Depository Trust Company,  a New York corporation  ("DTC"),  to Issuer or
its agent for registration of transfer, exchange or payment, and any certificate
issued  is  registered  in the name of Cede & Co.  or in such  other  name as is
requested  by an  authorized  representative  of DTC (and any payment is made to
Cede  &  Co.  or  to  such  other  entity  as  is  requested  by  an  authorized
representative  of DTC),  ANY TRANSFER,  PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE  BY OR TO ANY PERSON IS  WRONGFUL  inasmuch  as the  registered  owner
hereof, Cede & Co., has an interest herein.<F1>

              CONTINENTAL AIRLINES ____________ PASS THROUGH TRUST

                                  Pass Through
                         Certificate, Series __________

                  Final Regular Distribution Date: _____, ____

               evidencing  a fractional  undivided  interest in a
               trust,  the  property  of which  includes  certain
               equipment  notes each secured by Aircraft owned by
               or leased to Continental Airlines, Inc.

Certificate         

No.____________          $_________  Fractional Undivided Interest  representing
                         ._____% of the Trust per $1,000 face amount

          THIS CERTIFIES THAT  __________________,  for value  received,  is the
registered  owner of a  $___________  (________  dollars)  Fractional  Undivided
Interest in the  Continental  Airlines  Pass  Through  Trust,  Series [___] (the
"TRUST")  created by  Wilmington  Trust  Company,  as trustee  (the  "TRUSTEE"),
pursuant to a Pass  Through  Trust  Agreement  dated as of [ ], 1997 (the "BASIC
AGREEMENT"),  as  supplemented  by Trust  Supplement No.  _______  thereto dated
__________,  199_  (collectively,  the  "Agreement"),  between  the  Trustee and
Continental Airlines,  Inc., a corporation  incorporated under Delaware law (the
"COMPANY"),  a summary of certain of the  pertinent  provisions  of which is set
forth below. To the extent not otherwise  defined herein,  the capitalized terms
used  herein  have  the  meanings  assigned  to  them  in  the  Agreement.  This
Certificate  is one of the  duly  authorized  Certificates  designated  as "___%
Continental Airlines Pass Through  Certificate,  Series ____" (herein called the
"CERTIFICATES").  This  Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement.  By virtue of its acceptance hereof,

___________________

<F1>This  legend  to  appear on Book-Entry Certificates to be deposited with The
    Depository Trust Company.


<PAGE>

the  Certificateholder  of this Certificate assents to and agrees to be bound by
the  provisions of the Agreement and any related  Intercreditor  Agreement.  The
property of the Trust  includes  certain  Equipment  Notes and all rights of the
Trust to receive any  payments  under any  Intercreditor  Agreement or Liquidity
Facility (the "TRUST PROPERTY"). Each issue of the Equipment Notes is or will be
secured by, among other  things,  a security  interest in aircraft  leased to or
owned by the Company.

          The Certificates represent fractional undivided interests in the Trust
and the Trust Property,  and have no rights,  benefits or interest in respect of
any  other  separate  trust  established  pursuant  to the  terms  of the  Basic
Agreement for any other series of certificates issued pursuant thereto.

          Subject to and in  accordance  with the terms of the Agreement and any
related Intercreditor Agreement, from funds then available to the Trustee, there
will be distributed on each __________ and ___________ (a "REGULAR  DISTRIBUTION
DATE"),  commencing  on  _________,  199_,  to the  Person  in whose  name  this
Certificate is registered at the close of business on the 15th day preceding the
Regular Distribution Date, an amount in respect of the Scheduled Payments on the
Equipment Notes due on such Regular  Distribution Date, the receipt of which has
been confirmed by the Trustee,  equal to the product of the percentage  interest
in the Trust  evidenced  by this  Certificate  and an amount equal to the sum of
such  Scheduled  Payments.  Subject to and in  accordance  with the terms of the
Agreement  and any related  Intercreditor  Agreement,  in the event that Special
Payments on the  Equipment  Notes are received by the  Trustee,  from funds then
available to the Trustee,  there shall be distributed on the applicable  Special
Distribution Date, to the Person in whose name this Certificate is registered at
the close of business on the 15th day preceding the Special  Distribution  Date,
an amount in  respect of such  Special  Payments  on the  Equipment  Notes,  the
receipt of which has been confirmed by the Trustee,  equal to the product of the
percentage  interest in the Trust  evidenced by this  Certificate  and an amount
equal to the sum of such Special Payments so received. If a Regular Distribution
Date or Special  Distribution Date is not a Business Day,  distribution shall be
made on the immediately following Business Day with the same force and effect as
if made on such Regular  Distribution  Date or Special  Distribution Date and no
interest  shall accrue  during the  intervening  period.  The Trustee shall mail
notice of each Special Payment and the Special Distribution Date therefor to the
Certificateholder of this Certificate.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the Person entitled thereto,  without the presentation or surrender of
this  Certificate  or the making of any  notation  hereon.  Except as  otherwise
provided in the Agreement and  notwithstanding the above, the final distribution
on this  Certificate  will be made  after  notice  mailed by the  Trustee of the
pendency of such  distribution and only upon  presentation and surrender of this
Certificate at the office or agency of the Trustee specified in such notice.

          The  Certificates  do not  represent  a direct  obligation  of,  or an
obligation  guaranteed  by, or an interest in, the Company or the Trustee or any
affiliate thereof. The Certificates are limited in right of payment, all as more
specifically set forth on the face hereof and in the Agreement.  All payments or


<PAGE>

distributions made to Certificateholders  under the Agreement shall be made only
from the Trust  Property  and only to the  extent  that the  Trustee  shall have
sufficient  income or proceeds from the Trust  Property to make such payments in
accordance  with the  terms of the  Agreement.  Each  Certificateholder  of this
Certificate,  by its acceptance  hereof,  agrees that it will look solely to the
income  and  proceeds  from the  Trust  Property  to the  extent  available  for
distribution  to such  Certificateholder  as  provided  in the  Agreement.  This
Certificate does not purport to summarize the Agreement and reference is made to
the Agreement for information with respect to the interests,  rights,  benefits,
obligations,  proceeds, and duties evidenced hereby. A copy of the Agreement may
be examined during normal business hours at the principal office of the Trustee,
and  at  such  other  places,  if  any,   designated  by  the  Trustee,  by  any
Certificateholder upon request.

          The Agreement permits,  with certain exceptions therein provided,  the
amendment  thereof and the  modification  of the rights and  obligations  of the
Company and the rights of the Certificateholders under the Agreement at any time
by the  Company  and the  Trustee  with the  consent  of the  Certificateholders
holding Certificates  evidencing  Fractional Undivided Interests aggregating not
less  than a  majority  in  interest  in the  Trust.  Any  such  consent  by the
Certificateholder  of this  Certificate  shall be conclusive and binding on such
Certificateholder and upon all future Certificateholders of this Certificate and
of any  Certificate  issued upon the transfer hereof or in exchange hereof or in
lieu  hereof  whether  or not  notation  of  such  consent  is  made  upon  this
Certificate.  The  Agreement  also  permits the  amendment  thereof,  in certain
limited  circumstances,  without the consent of the Certificateholders of any of
the Certificates.

          As provided in the  Agreement and subject to certain  limitations  set
forth,  the transfer of this  Certificate  is  registrable  in the Register upon
surrender of this  Certificate  for  registration  of transfer at the offices or
agencies  maintained  by the  Trustee in its  capacity as  Registrar,  or by any
successor  Registrar  duly endorsed or  accompanied  by a written  instrument of
transfer in form satisfactory to the Trustee and the Registrar, duly executed by
the  Certificateholder   hereof  or  such   Certificateholder's   attorney  duly
authorized in writing,  and thereupon one or more new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest in the
Trust will be issued to the designated transferee or transferees.

          The Certificates are issuable only as registered  Certificates without
coupons in minimum  denominations of $1,000  Fractional  Undivided  Interest and
integral  multiples  thereof  except  that one  Certificate  may be  issued in a
different  denomination.  As  provided in the  Agreement  and subject to certain
limitations  therein  set  forth,  the  Certificates  are  exchangeable  for new
Certificates   of  authorized   denominations   evidencing  the  same  aggregate
Fractional   Undivided   Interest   in   the   Trust,   as   requested   by  the
Certificateholder surrendering the same.

          No service charge will be made for any such  registration  of transfer
or exchange,  but the Trustee shall require payment of a sum sufficient to cover
any tax or governmental charge payable in connection therewith.

          The  Trustee,  the  Registrar,  and any  agent of the  Trustee  or the
Registrar may treat the person in whose name this  Certificate  is registered as


<PAGE>


the owner hereof for all purposes,  and neither the Trustee, the Registrar,  nor
any such agent shall be affected by any notice to the contrary.

          The obligations and responsibilities  created by the Agreement and the
Trust   created   thereby   shall    terminate   upon   the    distribution   to
Certificateholders of all amounts required to be distributed to them pursuant to
the  Agreement  and the  disposition  of all property  held as part of the Trust
Property.

          THIS  CERTIFICATE  AND THE AGREEMENT  HAVE EACH BEEN  DELIVERED IN THE
STATE OF NEW YORK AND  SHALL BE  CONSTRUED  IN  ACCORDANCE  WITH THE LAWS OF THE
STATE OF NEW YORK AND THE  OBLIGATIONS,  RIGHTS AND  REMEDIES OF THE PARTIES AND
CERTIFICATEHOLDERS  HEREUNDER AND  THEREUNDER  SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.

          Unless the certificate of  authentication  hereon has been executed by
the Trustee, by manual signature,  this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


<PAGE>

          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

                                        CONTINENTAL AIRLINES, INC.


                                        By: WILMINGTON TRUST COMPANY,
                                            as Trustee


                                        By:_____________________________________
                                        Title:__________________________________

Dated:  ______________________


<PAGE>


              [FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION]

                   This is one of the Certificates referred to
                       in the within-mentioned Agreement.


                                        WILMINGTON TRUST COMPANY,
                                          as Trustee


                                        By:_____________________________________
                                                   Authorized Officer





                          TRUST SUPPLEMENT NO. 1997-3A

                            Dated September 25, 1997



                                     between



                            WILMINGTON TRUST COMPANY,
                                   as Trustee,



                                       and



                           CONTINENTAL AIRLINES, INC.



                                       to



                          PASS THROUGH TRUST AGREEMENT
                         Dated as of September 25, 1997



                                   $54,440,000

                           Continental Airlines, Inc.
                           Pass Through Trust, 1997-3A

                           Continental Airlines, Inc.
                        1997-3 Pass Through Certificates,
                                     Class A




<PAGE>


<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----


                                    ARTICLE I

                                THE CERTIFICATES

<S>             <C>                                                          <C>
Section 1.01.   The Certificates ..............................................2


                                   ARTICLE II

                           DEFINITIONS AND AMENDMENTS

Section 2.01.   Definitions ...................................................4

Section 2.02.   Amendments ....................................................5


                                   ARTICLE III

                                     DEFAULT

Section 3.01.   Purchase Rights of Certificateholders .........................6


                                   ARTICLE IV

                                   THE TRUSTEE

Section 4.01.   The Trustee ...................................................7


                                    ARTICLE V

                            MISCELLANEOUS PROVISIONS

Section 5.01.   Basic Agreement Modified and Ratified .........................8

Section 5.02.   GOVERNING LAW .................................................8

Section 5.03.   Execution in Counterparts .....................................8
</TABLE>



<PAGE>

          This Trust  Supplement  No.  1997-3A,  dated as of September  25, 1997
(herein called the "TRUST SUPPLEMENT"),  between Continental  Airlines,  Inc., a
Delaware  corporation  (the  "COMPANY"),   and  Wilmington  Trust  Company  (the
"TRUSTEE"), to the Pass Through Trust Agreement, dated as of September 25, 1997,
between the Company and the Trustee (the "BASIC AGREEMENT").

                              W I T N E S S E T H:
                              - - - - - - - - - -

          WHEREAS, the Basic Agreement,  unlimited as to the aggregate
 principal
amount of Certificates  (unless otherwise  specified  herein,  capitalized terms
used  herein  without  definition  having  the  respective   meanings  specified
heretofore  in  the  Basic  Agreement)  which  may  be  issued  thereunder,  has
heretofore been executed and delivered;

          WHEREAS, each Owner Trustee,  acting on behalf of its respective Owner
Participant,  will issue, on a non-recourse basis,  Equipment Notes, among other
things,  to refinance the outstanding  debt portion of the purchase price of the
aircraft  purchased by such Owner Trustee and leased to the Company  pursuant to
the related Lease;

          WHEREAS,  pursuant to the terms and conditions of the Basic  Agreement
as supplemented by this Trust  Supplement (the  "AGREEMENT"),  the Trustee shall
purchase  such  Equipment  Notes  issued by each Owner  Trustee  having the same
interest  rate as, and final  maturity  dates not later than the final  expected
Regular  Distribution Date of, the Certificates  issued hereunder and shall hold
such Equipment Notes in trust for the benefit of the Class A Certificateholders;

          WHEREAS,  the Trustee hereby declares the creation of this Continental
Airlines  Pass Through  Trust,  Series  1997-3A (the "1997-3A  TRUST"),  for the
benefit  of  the  Class  A   Certificateholders,   and  the   initial   Class  A
Certificateholders  as the grantors of the 1997-3A  Trust,  by their  respective
acceptances of the Certificates  issued hereunder,  join in the creation of this
1997-3A Trust with the Trustee;

          WHEREAS, all of the conditions and requirements necessary to make this
Trust Supplement,  when duly executed and delivered,  a valid, binding and legal
instrument in accordance  with its terms and for the purposes  herein  expressed
have been done, performed and fulfilled,  and the execution and delivery of this
Trust Supplement in the form and with the terms hereof have been in all respects
duly authorized; and

          WHEREAS,  this Trust  Supplement  is subject to the  provisions of the
Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be
governed by such provisions;

          NOW, THEREFORE,  in consideration of the premises herein, it is agreed
between the Company and the Trustee as follows:


<PAGE>

                                    ARTICLE I
                                THE CERTIFICATES

          Section 1.01.  THE  CERTIFICATES.  There is hereby created a series of
Certificates to be issued under the Agreement to be  distinguished  and known as
"Continental  Airlines Pass Through  Certificates,  Series 1997-3A" (hereinafter
defined as the "SERIES 1997-3A  CERTIFICATES").  Each Series 1997-3A Certificate
represents a fractional  undivided interest in the 1997-3A Trust created hereby.
The Series  1997-3A  Certificates  shall be the only  instruments  evidencing  a
fractional undivided interest in the 1997-3A Trust.

          The terms and conditions applicable to the Series 1997-3A Certificates
are as follows:

          (a) The aggregate principal amount of the Series 1997-3A  Certificates
that shall be  authenticated  under the  Agreement  (except  for Series  1997-3A
Certificates  authenticated  and delivered  pursuant to Sections 3.03,  3.04 and
3.06 of the Basic Agreement) is $54,440,000.

          (b) The Cut-off Date is October 31, 1997.

          (c) The Regular  Distribution  Date with  respect  to any  payment  of
Scheduled  Payments  means  March 24, June 24,  September  24 and  December  24,
commencing on December 24, 1997 until  payment of all of the Scheduled  Payments
to be made under the Equipment Notes has been made.

          (d) The Special  Distribution  Date with respect to the Series 1997-3A
Certificates  means  any  Business  Day on  which  a  Special  Payment  is to be
distributed pursuant to the Agreement.

          (e)(i) The Series 1997-3A  Certificates  shall be in the form attached
hereto  as  Exhibit  A. Any  Person  acquiring  or  accepting  a Series  1997-3A
Certificate or an interest therein will, by such  acquisition or acceptance,  be
deemed to have  represented  and  warranted to and for the benefit of each Owner
Participant  and the Company  that either (i) the assets of an employee  benefit
plan subject to Title I of the Employee  Retirement Income Security Act of 1974,
as amended  ("ERISA"),  or of a plan  subject to  Section  4975 of the  Internal
Revenue Code of 1986,  as amended (the  "Code"),  have not been used to purchase
Series  1997-3A  Certificates  or an interest  therein or (ii) the  purchase and
holding of Series 1997-3A  Certificates or interest  therein are exempt from the
prohibited  transaction  restrictions  of ERISA and the Code  pursuant to one or
more prohibited transaction statutory or administrative exemptions.

          (ii) The Series 1997-3A Certificates shall be Book-Entry  Certificates
     and  shall  be  subject  to the  conditions  set  forth  in the  Letter  of
     Representations  between the Company,  the Trustee and the Clearing  Agency
     attached hereto as Exhibit B.

          (f) The Scheduled  Payments  of  principal  shall  be as set  forth in
Exhibit C hereto.


<PAGE>

          (g)All or a portion of the proceeds of the Series 1997-3A Certificates
shall be used to purchase the Equipment Notes in the principal amounts specified
below and the unused portion of such proceeds, if any, shall be deposited in the
Escrow Account to be applied as set forth in the Agreement:


<TABLE>
<CAPTION>

          REGISTRATION NUMBER                                   PRINCIPAL AMOUNT
          -------------------                                   ----------------
                 <S>                                               <C>
                 N14925............................................$6,276,000
                 N15926............................................ 6,276,000
                 N16927............................................ 6,276,000
                 N17928............................................ 5,540,000
                 N13929............................................ 5,540,000
                 N14930............................................ 6,133,000
                 N14931............................................ 6,133,000
                 N15932............................................ 6,133,000
                 N14933............................................ 6,133,000

</TABLE>

          (h) Each  Owner Trustee,  acting  on behalf  of its  respective  Owner
Participant,  will issue,  on a non-recourse  basis,  the Equipment  Notes,  the
proceeds  of  which  shall  be  used,  among  other  things,  to  refinance  the
outstanding  debt  portion of the  purchase  price to such Owner  Trustee of the
following Aircraft:


<TABLE>
<CAPTION>

REGISTRATION NUMBER              AIRCRAFT TYPE                    ENGINE TYPE
- -------------------              -------------                    -----------
      <S>                        <C>                                <C>  
      N14925                     Embraer EMB-145                    AE3007A
      N15926                     Embraer EMB-145                    AE3007A
      N16927                     Embraer EMB-145                    AE3007A
      N17928                     Embraer EMB-145                    AE3007A
      N13929                     Embraer EMB-145                    AE3007A
      N14930                     Embraer EMB-145                    AE3007A
      N14931                     Embraer EMB-145                    AE3007A
      N15932                     Embraer EMB-145                    AE3007A
      N14933                     Embraer EMB-145                    AE3007A

</TABLE>

          (i) The related Note Documents are listed on Exhibit D.
                                                                       
          (j) Notice of any  termination  of the  1997-3A  Trust shall be mailed
promptly by the Trustee to the Class A  Certificateholders  not earlier than the
60th day and not later than the 15th day next  preceding the final  distribution
pursuant to the Agreement.
                                                                       
          (k) Except as contemplated by Section 2.02(b) of the Basic  Agreement,
there will be no deposit agreement or other arrangement prior to the delivery of
any Aircraft.

          (l) The Series 1997-3A Certificates  are subject to the  Intercreditor
Agreement.

          (m) The Series  1997-3A  Certificates  will  have the  benefit  of the
Liquidity Facility.


<PAGE>

          (n) The Responsible Party is the Company.

          (o) The Final Legal Distribution Date is September 24, 2014.

          (p) The  particular  "sections of the Note  Purchase  Agreement",  for
purposes of clause (3) of Section 7.07 of the Basic  Agreement,  are Section 9.1
of each Note Purchase Agreement.

                                   ARTICLE II
                           DEFINITIONS AND AMENDMENTS

          Section 2.01. DEFINITIONS.  For all purposes of the Basic Agreement as
supplemented by this Trust  Supplement,  the following  capitalized  terms shall
have the following meanings:

          CLASS A  CERTIFICATEHOLDER:  Means the  Person in whose  name a Series
     1997-3A  Certificate  is registered on the Register for the Series  1997-3A
     Certificates.

          INTERCREDITOR AGREEMENT: Means the Intercreditor Agreement dated as of
     the date  hereof  among the  Trustee,  the Other  Trustees,  the  Liquidity
     Provider named therein and Wilmington Trust Company, as Subordination Agent
     and as trustee, as amended, supplemented or otherwise modified from time to
     time in accordance with its terms.

          LIQUIDITY  FACILITY:  Means the Revolving Credit Agreement dated as of
     the date hereof among Wilmington Trust Company,  as Subordination Agent and
     trustee for the 1997-3A Trust, and ABN AMRO Bank, N.V.,  acting through its
     Chicago Branch, as amended,  replaced,  supplemented or otherwise  modified
     from  time to time in  accordance  with  its  terms  and the  terms  of the
     Intercreditor Agreement..

          OTHER  AGREEMENTS:  Means (i) the Basic  Agreement as  supplemented by
     Trust  Supplement  1997-3B  dated as of the  date  hereof  relating  to the
     Continental  Airlines Pass Through Trust  created  thereunder  and (ii) the
     Basic Agreement as  supplemented by Trust  Supplement No. 1997-3C dated the
     date hereof relating to the Continental Airlines Pass Through Trust created
     thereunder.

          OTHER TRUSTEES: Means each of the trustees under the Other Agreements,
     and any  successor  thereunder  or  other  trustee  appointed  as  provided
     therein.

          PTC EVENT OF  DEFAULT:  Means the  failure to pay within ten  Business
     Days of the due date  thereof:  (i) the  outstanding  Pool  Balance  of the
     Series 1997-3A  Certificates on the Final Legal  Distribution Date for such
     Series  1997-3A  Certificates  or (ii) interest due on such Series  1997-3A
     Certificates on any Distribution Date (unless the Subordination Agent shall
     have made an Interest Drawing or Drawings (as defined in the  Intercreditor
     Agreement),  or a withdrawal or withdrawals  pursuant to a cash  collateral
     account  under the  Intercreditor  Agreement,  with  respect  thereto in an
     aggregate amount sufficient to pay such interest and shall have distributed
     such amount to the Trustee).


<PAGE>

          Section   2.02.   AMENDMENTS.   Solely  for  purposes  of  this  Trust
Supplement,  Section  2.02(b) of the Basic Agreement shall be amended to read as
follows:

          (b) If on or prior to the  Issuance  Date with  respect to a series of
Certificates  the Company  shall  deliver to the Trustee a  Postponement  Notice
relating to one or more Postponed Notes, the Trustee shall postpone the purchase
of such  Postponed  Notes and shall  deposit into an escrow  account (as to such
Trust,  the "ESCROW  ACCOUNT") to be  maintained as part of the related Trust an
amount  equal to the  purchase  price of such  Postponed  Notes  (the  "ESCROWED
FUNDS").  The portion of the  Escrowed  Funds so  deposited  with respect to any
particular  Postponed  Notes  shall be  invested  by the  Trustee at the written
direction  of the  Responsible  Party in Specified  Investments  (i) maturing no
later than any scheduled  Transfer Date relating to such Postponed Notes or (ii)
if no such Transfer Date has been scheduled,  maturing on the next Business Day,
or (iii) if the Company  has given  notice to the  Trustee  that such  Postponed
Notes will not be issued,  maturing on the next applicable Special  Distribution
Date, if such  investments  are reasonably  available for purchase.  The Trustee
shall  make  withdrawals  from  the  Escrow  Account  only as  provided  in this
Agreement.  Upon  request  of the  Company  on one or  more  occasions  and  the
satisfaction  or waiver of the closing  conditions  specified in the  applicable
Note Purchase  Agreements on or prior to the related  Cut-off Date,  the Trustee
shall purchase the applicable  Postponed Notes with the Escrowed Funds withdrawn
from the Escrow Account.  The purchase price shall equal the principal amount of
such Postponed Notes.

          The Trustee  shall hold all Specified  Investments  until the maturity
thereof  and will not  sell or  otherwise  transfer  Specified  Investments.  If
Specified  Investments  held in an Escrow Account mature prior to any applicable
Transfer  Date,  any  proceeds  received  on  the  maturity  of  such  Specified
Investments  (including any earnings thereon) shall be reinvested by the Trustee
at the written  direction  of the  Responsible  Party in  Specified  Investments
maturing as provided in the preceding paragraph. The Responsible Party shall pay
to the Trustee for deposit to the relevant Escrow Account an amount equal to any
losses on such Specified Investments as incurred.

          On  the  Initial   Regular   Distribution   Date  in  respect  of  the
Certificates  of any  series,  the  Responsible  Party will pay (in  immediately
available  funds) to the Trustee an amount equal to (i) the interest  that would
have accrued on any Postponed Notes with respect to such  Certificates,  if any,
purchased  after the Issuance Date if such Postponed Notes had been purchased on
the Issuance Date, from the Issuance Date to, but not including, the date of the
purchase  of such  Postponed  Notes by the  Trustee  minus (ii) the  earnings on
Specified  Investments  (disregarding any losses thereon) received (with respect
to the portion of the Escrow Funds deposited with respect to the Postponed Notes
described in clause (i) of this paragraph) by the Trustee from and including the
Issuance Date to, but not including, the Initial Regular Distribution Date.

          If, in respect of the Certificates of any series, the Company notifies
the  Trustee  prior to the  Cut-off  Date that any  Postponed  Notes will not be
issued  on or prior to the  Cut-off  Date for any  reason,  on the next  Special
Distribution  Date  for  such  Certificates  occurring  not  less  than  15 days


<PAGE>

following the date of such notice,  (i) the  Responsible  Party shall pay to the
Trustee for deposit in the related  Special  Payments  Account,  in  immediately
available  funds, an amount equal to (A) the interest that would have accrued on
the  Postponed  Notes  designated in such notice at a rate equal to the interest
rate  applicable  to such  Certificates  from  the  Issuance  Date  to,  but not
including,  such Special  Distribution  Date minus (B) the earnings on Specified
Investments  (disregarding  any losses  thereon)  received  (with respect to the
portion of the Escrowed  Funds  deposited  with respect to the  Postponed  Notes
designated  in such notice) by the Trustee from and  including the Issuance Date
to, but not including, such Special Distribution Date and (ii) the Trustee shall
transfer an amount  equal to that amount of Escrowed  Funds that would have been
used to purchase the  Postponed  Notes  designated in such notice and the amount
paid by the Responsible  Party pursuant to the immediately  preceding clause (i)
to the related Special Payments Account for distribution as a Special Payment in
accordance with the provisions hereof.

          If, on such  Cut-off  Date,  an  amount  equal to less than all of the
Escrowed  Funds  (other  than  Escrowed  Funds  referred  to in the  immediately
preceding paragraph) has been used to purchase Postponed Notes, on the next such
Special Distribution Date occurring not less than 15 days following such Cut-off
Date,  (i) the  Responsible  Party  shall pay to the Trustee for deposit in such
Special Payments Account, in immediately available funds, an amount equal to (A)
the interest that would have accrued on such Postponed Notes  contemplated to be
purchased with such unused Escrowed Funds (other than Escrowed Funds referred to
in the immediately  preceding paragraph) but not so purchased at a rate equal to
the interest rate applicable to such Certificates from the Issuance Date to, but
not  including,  such  Special  Distribution  Date  minus  (B) the  earnings  on
Specified  Investments  (disregarding any losses thereon) received (with respect
to the portion of the Escrowed  Funds  deposited  with respect to the  Postponed
Notes  contemplated  to be purchased with such unused Escrowed Funds (other than
Escrowed Funds referred to in the  immediately  preceding  paragraph) but not so
purchased)  by the Trustee  from and  including  the  Issuance  Date to, but not
including,  such Special  Distribution  Date and (ii) the Trustee shall transfer
such unused Escrowed Funds and the amount paid by the Responsible Party pursuant
to the immediately  preceding  clause (i) to such Special  Payments  Account for
distribution as a Special Payment in accordance with the provisions hereof.

                                   ARTICLE III
                                     DEFAULT

          Section 3.01. PURCHASE RIGHTS OF CERTIFICATEHOLDERS. (a) By acceptance
of its Series 1997-3A Certificate, each Class A Certificateholder agrees that at
any time after the occurrence and during the continuation of a Triggering Event,

          (i) Each Class B  Certificateholder  shall have the right to  purchase
     all,  but not less than all, of the Series  1997-3A  Certificates  upon ten
     days'   written   notice   to  the   Trustee   and  each   other   Class  B
     Certificateholder,  provided  that (A) if prior to the end of such  ten-day
     period any other Class B Certificateholder notifies such purchasing Class B
     Certificateholder  that  such  other  Class B  Certificateholder  wants  to
     participate in such purchase, then such other Class B Certificateholder may


<PAGE>

     join with the purchasing  Class B  Certificateholder  to purchase,  for the
     purchase  price  and  otherwise  in  accordance  with  and  subject  to the
     provisions set forth in Section  6.01(b) of the Basic  Agreement,  all, but
     not less than all, of the Series 1997-3A Certificates pro rata based on the
     Fractional  Undivided Interest in the Class B Trust held by each such Class
     B Certificateholder  and (B) if prior to the end of such ten-day period any
     other  Class B  Certificateholder  fails to notify the  purchasing  Class B
     Certificateholder  of such  other  Class B  Certificateholder's  desire  to
     participate in such a purchase,  then such other Class B  Certificateholder
     shall lose its right to purchase the Series 1997-3A  Certificates  pursuant
     to this Section and Section 6.01(b) of the Basic Agreement; and

          (ii) Each Class C Certificateholder  shall have the right (which shall
     not expire upon any purchase of the Series 1997-3A Certificates pursuant to
     clause (i) above) to  purchase,  for the  purchase  price and  otherwise in
     accordance  with and subject to the provisions set forth in Section 6.01(b)
     of the Basic  Agreement,  all, but not less than all, of the Series 1997-3A
     Certificates and the Class B Certificates  upon ten days' written notice to
     the Trustee,  the Class B Trustee and each other Class C Certificateholder,
     provided  that (A) if prior to the end of such  ten-day  period  any  other
     Class   C    Certificateholder    notifies   such   purchasing    Class   C
     Certificateholder  that  such  other  Class C  Certificateholder  wants  to
     participate in such purchase, then such other Class C Certificateholder may
     join with the purchasing Class C Certificateholder to purchase all, but not
     less  than  all,  of the  Series  1997-3A  Certificates  and  the  Class  B
     Certificates  pro rata based on the  Fractional  Undivided  Interest in the
     Class C Trust held by each such Class C Certificateholder  and (b) if prior
     to the end of such ten-day period any other Class C Certificateholder fails
     to notify the purchasing  Class C  Certificateholder  of such other Class C
     Certificateholder's  desire to  participate  in such a purchase,  then such
     other Class C Certificateholder shall lose its right to purchase the Series
     1997-3A Certificates and the Class B Certificates  pursuant to this Section
     and Section 6.01(b) of the Basic Agreement.

          (b) As used in this  Article  III,  the terms  "Class B  Certificate",
"Class B  Certificateholder",  "Class B  Trust",  "Class  B  Trustee",  "Class C
Certificateholder"  and  "Class C Trust"  shall  have  the  respective  meanings
assigned to such terms in the Intercreditor Agreement.

                                   ARTICLE IV
                                   THE TRUSTEE

          Section 4.01. THE TRUSTEE.  The Trustee is hereby  directed to execute
and deliver the Intercreditor  Agreement on or prior to the Issuance Date in the
form  delivered  to the  Trustee  by  the  Company.  The  Trustee  shall  not be
responsible  in any  manner  whatsoever  for or in respect  of the  validity  or
sufficiency of this Trust Supplement or the due execution hereof by the Company,
or for or in respect of the recitals and  statements  contained  herein,  all of
which recitals and statements are made solely by the Company.

          The Trustee, upon the execution and delivery of this Trust Supplement,
acknowledges its acceptance of all right, title and interest in and to the Trust
Property  with respect to the 1997-3A  Trust and declares that the Trustee holds


<PAGE>

and will hold such right, title and interest for the benefit of all then present
and future  Class A  Certificateholders,  upon the trusts set forth in the Basic
Agreement and this Trust  Supplement.  By its  acceptance of each Series 1997-3A
Certificate   issued  to  it  under  the   Agreement,   each  initial   Class  A
Certificateholder  as grantor of the 1997-3A Trust thereby joins in the creation
and declaration of the 1997-3A Trust.

          Except as herein otherwise  provided,  no duties,  responsibilities or
liabilities are assumed,  or shall be construed to be assumed, by the Trustee by
reason of this Trust  Supplement other than as set forth in the Basic Agreement,
and this Trust  Supplement  is executed  and  accepted on behalf of the Trustee,
subject to all the terms and conditions set forth in the Basic  Agreement,  upon
the effectiveness thereof, as if the same were herein set forth at length.

          The Trustee  represents and warrants that the Intercreditor  Agreement
will  be  duly  executed  and  delivered  by  one of its  officers  who is  duly
authorized to execute and deliver such document on its behalf.

                                    ARTICLE V
                            MISCELLANEOUS PROVISIONS

          Section  5.01.  BASIC  AGREEMENT  MODIFIED  AND  RATIFIED.  The  Basic
Agreement is  incorporated  herein by reference  in its  entirety,  and shall be
deemed to be a part of this Trust Supplement as if set forth in full herein, and
is in all respects ratified and confirmed,  as supplemented and modified by this
Trust Supplement.

          Section 5.02.  GOVERNING  LAW. THIS TRUST  SUPPLEMENT  AND THE CLASS A
CERTIFICATES  SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE  WITH THE LAWS OF
THE STATE OF NEW YORK.

          Section 5.03. EXECUTION IN COUNTERPARTS.  This Trust Supplement may be
executed in any number of counterparts,  each of which shall be an original, but
such counterparts shall together constitute but one and the same instrument.


<PAGE>

          IN WITNESS WHEREOF, the Company and the Trustee have caused this Trust
Supplement  to be duly  executed by their  respective  officers  thereunto  duly
authorized, as of the day and year first written above.


                                       CONTINENTAL AIRLINES, INC.



                                        By:_____________________________________
                                          Name:
                                          Title:



                                       WILMINGTON TRUST COMPANY, as Trustee



                                        By:_____________________________________
                                          Name:
                                          Title:


<PAGE>


                                    EXHIBIT A
                                    ---------

                               Form of Certificate

          [Include on each Certificate that is a Global Certificate: Unless this
certificate is presented by an authorized representative of The Depository Trust
Company, a New York corporation ("DTC"), to Issuer or its agent for registration
of transfer,  exchange or payment,  and any certificate  issued is registered in
the name of Cede & Co. or in such other name as is  requested  by an  authorized
representative  of DTC (and any  payment  is made to Cede & Co. or to such other
entity as is requested by an authorized  representative  of DTC),  ANY TRANSFER,
PLEDGE  OR OTHER  USE  HEREOF  FOR  VALUE OR  OTHERWISE  BY OR TO ANY  PERSON IS
WRONGFUL  inasmuch as the registered  owner hereof,  Cede & Co., has an interest
herein.]<F1>

                 CONTINENTAL AIRLINES 1997-3A PASS THROUGH TRUST

                                  Pass Through
                           Certificate, Series 1997-3A

                        Issuance Date: September 25, 1997

                Final Expected Distribution Date: March 24, 2013

         evidencing a fractional undivided interest in a 1997-3A Trust,
          the property of which includes certain equipment notes each
            secured by aircraft leased to Continental Airlines, Inc.

Certificate
No. _______      $ ________Fractional Undivided Interest representing 0.0018369%
                 of the Trust per $1,000 of face amount
                    

          THIS  CERTIFIES THAT  _________________,  for value  received,  is the
registered owner of a $_____ (__ dollars)  Fractional  Undivided Interest in the
Continental Airlines Pass Through Trust, Series 1997-3A (the "TRUST") created by
Wilmington Trust Company, as trustee (the "TRUSTEE"), pursuant to a Pass Through
Trust  Agreement,  dated as of September  25, 1997 (the "BASIC  AGREEMENT"),  as
supplemented by Trust Supplement No. 1997-3A thereto,  dated as of September 25,
1997  (collectively,  the  "AGREEMENT")  between  the  Trustee  and  Continental
Airlines,  Inc.,  a Delaware  corporation  (the  "COMPANY" or the  "ISSUER"),  a
summary of certain of the pertinent  provisions of which is set forth below.  To
the extent not otherwise defined herein,  the capitalized terms used herein have
the meanings  assigned to them in the Agreement.  This Certificate is one of the
duly authorized  Certificates  designated as "Continental  Airlines Pass Through
Certificates,   Series  1997-3A"  (herein  called  the   "CERTIFICATES").   This
Certificate  is  issued  under  and is  subject  to the  terms,  provisions  and

___________________

<F1>  This legend to appear on Book-Entry Certificates to be deposited with  The
      Depository Trust Company.


<PAGE>

conditions  of  the  Agreement.   By  virtue  of  its  acceptance   hereof,  the
Certificateholder  of this Certificate  assents to and agrees to be bound by the
provisions of the Agreement and the Intercreditor Agreement. The property of the
Trust includes  certain  Equipment  Notes and all rights of the Trust to receive
payments  under the  Intercreditor  Agreement  and the  Liquidity  Facility (the
"TRUST PROPERTY").  Each issue of the Equipment Notes is secured by, among other
things, a security interest in aircraft leased to the Company.

          The Certificates represent fractional undivided interests in the Trust
and the Trust Property,  and have no rights,  benefits or interest in respect of
any  other  separate  trust  established  pursuant  to the  terms  of the  Basic
Agreement for any other series of certificates issued pursuant thereto.

          Subject to and in  accordance  with the terms of the Agreement and the
Intercreditor Agreement, from funds then available to the Trustee, there will be
distributed on each March 24, June 24,  September 24 and December 24 (a "REGULAR
DISTRIBUTION  DATE"),  commencing  on December 24, 1997,  to the Person in whose
name this  Certificate  is  registered  at the close of business on the 15th day
preceding the Regular  Distribution  Date, an amount in respect of the Scheduled
Payments on the  Equipment  Notes due on such  Regular  Distribution  Date,  the
receipt of which has been confirmed by the Trustee,  equal to the product of the
percentage  interest in the Trust  evidenced by this  Certificate  and an amount
equal to the sum of such Scheduled  Payments.  Subject to and in accordance with
the terms of the Agreement and the  Intercreditor  Agreement,  in the event that
Special Payments on the Equipment Notes are received by the Trustee,  from funds
then  available to the Trustee,  there shall be  distributed  on the  applicable
Special  Distribution  Date,  to the  Person in whose name this  Certificate  is
registered  at the  close of  business  on the 15th day  preceding  the  Special
Distribution  Date,  an  amount  in  respect  of such  Special  Payments  on the
Equipment Notes,  the receipt of which has been confirmed by the Trustee,  equal
to the  product  of the  percentage  interest  in the  Trust  evidenced  by this
Certificate and an amount equal to the sum of such Special Payments so received.
If a Regular  Distribution  Date or Special  Distribution Date is not a Business
Day,  distribution shall be made on the immediately  following Business Day with
the same  force  and  effect  as if made on such  Regular  Distribution  Date or
Special  Distribution  Date and no interest shall accrue during the  intervening
period.  The Trustee  shall mail notice of each Special  Payment and the Special
Distribution Date therefor to the Certificateholder of this Certificate.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the Person entitled thereto,  without the presentation or surrender of
this  Certificate  or the making of any  notation  hereon.  Except as  otherwise
provided in the Agreement and  notwithstanding the above, the final distribution
on this  Certificate  will be made  after  notice  mailed by the  Trustee of the
pendency of such  distribution and only upon  presentation and surrender of this
Certificate at the office or agency of the Trustee specified in such notice.

          The  Certificates  do not  represent  a direct  obligation  of,  or an
obligation  guaranteed  by, or an interest in, the Company or the Trustee or any
affiliate thereof. The Certificates are limited in right of payment, all as more
specifically set forth on the face hereof and in the Agreement.  All payments or
distributions made to Certificateholders  under the Agreement shall be made only


<PAGE>

from the Trust  Property  and only to the  extent  that the  Trustee  shall have
sufficient  income or proceeds from the Trust  Property to make such payments in
accordance  with the  terms of the  Agreement.  Each  Certificateholder  of this
Certificate,  by its acceptance  hereof,  agrees that it will look solely to the
income  and  proceeds  from the  Trust  Property  to the  extent  available  for
distribution  to such  Certificateholder  as  provided  in the  Agreement.  This
Certificate does not purport to summarize the Agreement and reference is made to
the Agreement for information with respect to the interests,  rights,  benefits,
obligations,  proceeds, and duties evidenced hereby. A copy of the Agreement may
be examined during normal business hours at the principal office of the Trustee,
and  at  such  other  places,  if  any,   designated  by  the  Trustee,  by  any
Certificateholder upon request.

          The Agreement permits,  with certain exceptions therein provided,  the
amendment  thereof and the  modification  of the rights and  obligations  of the
Company and the rights of the Certificateholders under the Agreement at any time
by the  Company  and the  Trustee  with the  consent  of the  Certificateholders
holding Certificates  evidencing  Fractional Undivided Interests aggregating not
less  than a  majority  in  interest  in the  Trust.  Any  such  consent  by the
Certificateholder  of this  Certificate  shall be conclusive and binding on such
Certificateholder and upon all future Certificateholders of this Certificate and
of any  Certificate  issued upon the transfer hereof or in exchange hereof or in
lieu  hereof  whether  or not  notation  of  such  consent  is  made  upon  this
Certificate.  The  Agreement  also  permits the  amendment  thereof,  in certain
limited  circumstances,  without the consent of the Certificateholders of any of
the Certificates.

          As provided in the  Agreement and subject to certain  limitations  set
forth therein,  the transfer of this  Certificate is registrable in the Register
upon surrender of this  Certificate for  registration of transfer at the offices
or agencies  maintained by the Trustee in its capacity as  Registrar,  or by any
successor  Registrar  duly endorsed or  accompanied  by a written  instrument of
transfer in form satisfactory to the Trustee and the Registrar, duly executed by
the  Certificateholder   hereof  or  such   Certificateholder's   attorney  duly
authorized in writing,  and thereupon one or more new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest in the
Trust will be issued to the designated transferee or transferees.

          The Certificates are issuable only as registered  Certificates without
coupons in minimum  denominations of $1,000  Fractional  Undivided  Interest and
integral  multiples  thereof  except  that one  Certificate  may be  issued in a
different  denomination.  As  provided in the  Agreement  and subject to certain
limitations  therein  set  forth,  the  Certificates  are  exchangeable  for new
Certificates   of  authorized   denominations   evidencing  the  same  aggregate
Fractional   Undivided   Interest   in   the   Trust,   as   requested   by  the
Certificateholder surrendering the same.

          No service charge will be made for any such  registration  of transfer
or exchange,  but the Trustee shall require payment of a sum sufficient to cover
any tax or governmental charge payable in connection therewith.

          The  Trustee,  the  Registrar,  and any  agent of the  Trustee  or the
Registrar may treat the person in whose name this  Certificate  is registered as


<PAGE>

the owner hereof for all purposes,  and neither the Trustee, the Registrar,  nor
any such agent shall be affected by any notice to the contrary.

          The obligations and responsibilities  created by the Agreement and the
Trust   created   thereby   shall    terminate   upon   the    distribution   to
Certificateholders of all amounts required to be distributed to them pursuant to
the  Agreement  and the  disposition  of all property  held as part of the Trust
Property.

          Any Person  acquiring or  accepting  this  Certificate  or an interest
herein will, by such  acquisition or acceptance,  be deemed to have  represented
and warranted to and for the benefit of each Owner  Participant  and the Company
that  either:  (i) the assets of an employee  benefit plan subject to Title I of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or of
a plan subject to Section 4975 of the Internal  Revenue Code of 1986, as amended
(the  "CODE"),  have not been used to purchase this  Certificate  or an interest
herein or (ii) the purchase and holding of this  Certificate or interest  herein
are exempt from the prohibited  transaction  restrictions  of ERISA and the Code
pursuant  to one or more  prohibited  transaction  statutory  or  administration
exemptions.

          THIS  CERTIFICATE  AND THE AGREEMENT  HAVE EACH BEEN  DELIVERED IN THE
STATE OF NEW YORK AND  SHALL BE  CONSTRUED  IN  ACCORDANCE  WITH THE LAWS OF THE
STATE  OF  NEW  YORK  AND  THE   OBLIGATIONS,   RIGHTS  AND   REMEDIES   OF  THE
CERTIFICATEHOLDERS  HEREUNDER AND THE PARTIES  THEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

          Unless the certificate of  authentication  hereon has been executed by
the Trustee, by manual signature,  this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


<PAGE>

          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

                                        CONTINENTAL    AIRLINES   1997-3A   PASS
                                        THROUGH TRUST


                                        By: WILMINGTON TRUST COMPANY, as Trustee


                                        By:_____________________________________
                                           Title:_______________________________

Dated:____________________________


<PAGE>


               FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION


          This is one of the  Certificates  referred to in the  within-mentioned
Agreement.

                                        WILMINGTON TRUST COMPANY, as Trustee



                                        By:_____________________________________
                                           Name:
                                           Title:


<PAGE>


                                    EXHIBIT B
                                    ---------

                          DTC Letter of Representations




<PAGE>

                                    EXHIBIT C
                                    ---------

<TABLE>
<CAPTION>

                           Regular Distribution Dates

                                       and

                               Scheduled Payments


DATE                                             SCHEDULED PAYMENTS OF PRINCIPAL
- ----                                             -------------------------------
<S>                                                          <C>
December 24, 1997...............................             $  515,402
March 24, 1998..................................                423,390
June 24, 1998...................................                 45,761
September 24, 1998..............................                149,601
December 24, 1998...............................                566,859
March 24, 1999..................................                172,652
June 24, 1999...................................                299,241
September 24, 1999..............................                173,049
December 24, 1999...............................                831,531
March 24, 2000..................................                348,512
June 24, 2000...................................                374,988
September 24, 2000..............................                257,094
December 24, 2000...............................                905,558
March 24, 2001..................................                128,608
June 24, 2001...................................                252,000
September 24, 2001..............................                167,136
December 24, 2001...............................                775,924
March 24, 2002..................................                128,608
June 24, 2002...................................                252,000
September 24, 2002..............................                137,589
December 24, 2002...............................                805,471
March 24, 2003..................................                128,608
June 24, 2003...................................                252,000
September 24, 2003..............................                105,870
December 24, 2003...............................                837,190
March 24, 2004..................................                128,608
June 24, 2004...................................                252,000
September 24, 2004..............................                 71,814
December 24, 2004...............................                999,616
March 24, 2005..................................                141,238
June 24, 2005...................................                111,002
September 24, 2005..............................                269,589
December 24, 2005...............................              1,059,437
March 24, 2006..................................                      0
June 24, 2006...................................                213,854
September 24, 2006..............................                 61,588
</TABLE>



<PAGE>

<TABLE>

DATE                                             SCHEDULED PAYMENTS OF PRINCIPAL
- ----                                             -------------------------------
<S>                                                          <C>
December 24, 2006...............................              1,305,826
March 24, 2007..................................                      0
June 24, 2007...................................                213,854
September 24, 2007..............................                453,429
December 24, 2007...............................              1,855,972
March 24, 2008..................................                743,622
June 24, 2008...................................                707,548
September 24, 2008..............................              1,493,224
December 24, 2008...............................              1,689,375
March 24, 2009..................................              1,975,143
June 24, 2009...................................              2,010,656
September 24, 2009..............................              2,046,811
December 24, 2009...............................              2,083,614
March 24, 2010..................................              2,121,079
June 24, 2010...................................              2,159,219
September 24, 2010..............................              2,198,046
December 24, 2010...............................              2,237,568
March 24, 2011..................................              2,277,805
June 24, 2011...................................              2,318,762
September 24, 2011..............................              2,183,728
December 24, 2011...............................              1,819,586
March 24, 2012..................................              2,104,210
June 24, 2012...................................              1,885,708
September 24, 2012..............................              1,919,666
December 24, 2012...............................              1,746,152
March 24, 2013..................................                546,009

</TABLE>



<PAGE>

                                    EXHIBIT D
                                    ---------

                             Related Note Documents

                    [Information to be inserted post-closing]





                          TRUST SUPPLEMENT NO. 1997-3B

                            Dated September 25, 1997


                                     between

                            WILMINGTON TRUST COMPANY,
                                   as Trustee,


                                       and


                           CONTINENTAL AIRLINES, INC.

                                       to

                          PASS THROUGH TRUST AGREEMENT
                         Dated as of September 25, 1997


                                   $19,731,000

                           Continental Airlines, Inc.
                           Pass Through Trust, 1997-3B

                           Continental Airlines, Inc.
                        1997-3 Pass Through Certificates,
                                     Class B



<PAGE>


                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

                                    ARTICLE I

                                THE CERTIFICATES

Section 1.01.  The Certificates...............................................2

                                   ARTICLE II

                           DEFINITIONS AND AMENDMENTS

Section 2.01.  Definitions....................................................4
Section 2.02.  Amendments.....................................................5

                                   ARTICLE III

                                     DEFAULT

Section 3.01.  Purchase Rights of Certificateholders..........................7

                                   ARTICLE IV

                                   THE TRUSTEE

Section 4.01.  The Trustee....................................................8

                                    ARTICLE V

                            MISCELLANEOUS PROVISIONS

Section 5.01.  Basic Agreement Modified and Ratified..........................8
Section 5.02.  GOVERNING LAW..................................................8
Section 5.03.  Execution in Counterparts......................................8







<PAGE>



          This Trust  Supplement  No.  1997-3B,  dated as of September  25, 1997
(herein called the "TRUST SUPPLEMENT"),  between Continental  Airlines,  Inc., a
Delaware  corporation  (the  "COMPANY"),   and  Wilmington  Trust  Company  (the
"TRUSTEE"), to the Pass Through Trust Agreement, dated as of September 25, 1997,
between the Company and the Trustee (the "BASIC AGREEMENT").

                              W I T N E S S E T H:
                              - - - - - - - - - - 

          WHEREAS, the Basic Agreement,  unlimited as to the aggregate principal
amount
 of Certificates  (unless otherwise  specified  herein,  capitalized terms
used  herein  without  definition  having  the  respective   meanings  specified
heretofore  in  the  Basic  Agreement)  which  may  be  issued  thereunder,  has
heretofore been executed and delivered;

          WHEREAS, each Owner Trustee,  acting on behalf of its respective Owner
Participant,  will issue, on a non-recourse basis,  Equipment Notes, among other
things,  to refinance the outstanding  debt portion of the purchase price of the
aircraft  purchased by such Owner Trustee and leased to the Company  pursuant to
the related Lease;

          WHEREAS,  pursuant to the terms and conditions of the Basic  Agreement
as supplemented by this Trust  Supplement (the  "Agreement"),  the Trustee shall
purchase  such  Equipment  Notes  issued by each Owner  Trustee  having the same
interest  rate as, and final  maturity  dates not later than the final  expected
Regular  Distribution Date of, the Certificates  issued hereunder and shall hold
such Equipment Notes in trust for the benefit of the Class B Certificateholders;

          WHEREAS,  the Trustee hereby declares the creation of this Continental
Airlines  Pass Through  Trust,  Series  1997-3B (the "1997-3B  Trust"),  for the
benefit  of  the  Class  B   Certificateholders,   and  the   initial   Class  B
Certificateholders  as the grantors of the 1997-3B  Trust,  by their  respective
acceptances of the Certificates  issued hereunder,  join in the creation of this
1997-3B Trust with the Trustee;

          WHEREAS, all of the conditions and requirements necessary to make this
Trust Supplement,  when duly executed and delivered,  a valid, binding and legal
instrument in accordance  with its terms and for the purposes  herein  expressed
have been done, performed and fulfilled,  and the execution and delivery of this
Trust Supplement in the form and with the terms hereof have been in all respects
duly authorized; and

          WHEREAS,  this Trust  Supplement  is subject to the  provisions of the
Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be
governed by such provisions;

          NOW, THEREFORE,  in consideration of the premises herein, it is agreed
between the Company and the Trustee as follows:


<PAGE>


                                    ARTICLE I

                                THE CERTIFICATES

          Section 1.01.  THE  CERTIFICATES.  There is hereby created a series of
Certificates to be issued under the Agreement to be  distinguished  and known as
"Continental  Airlines Pass Through  Certificates,  Series 1997-3B" (hereinafter
defined as the "Series 1997-3B  Certificates").  Each Series 1997-3B Certificate
represents a fractional  undivided interest in the 1997-3B Trust created hereby.
The Series  1997-3B  Certificates  shall be the only  instruments  evidencing  a
fractional undivided interest in the 1997-3B Trust.

          The terms and conditions applicable to the Series 1997-3B Certificates
are as follows:

          (a) The aggregate principal amount of the Series 1997-3B  Certificates
     that shall be authenticated  under the Agreement (except for Series 1997-3B
     Certificates  authenticated  and delivered  pursuant to Sections 3.03, 3.04
     and 3.06 of the Basic Agreement) is $19,731,000.

          (b) The Cut-off Date is October 31, 1997.

          (c) The  Regular  Distribution  Date with  respect  to any  payment of
     Scheduled  Payments means March 24, June 24,  September 24 and December 24,
     commencing  on  December  24,  1997 until  payment of all of the  Scheduled
     Payments to be made under the Equipment Notes has been made.

          (d) The Special  Distribution  Date with respect to the Series 1997-3B
     Certificates  means any  Business  Day on which a Special  Payment is to be
     distributed pursuant to the Agreement.

          (e) (i) The Series 1997-3B  Certificates shall be in the form attached
     hereto as Exhibit A. Any Person  acquiring  or  accepting a Series  1997-3B
     Certificate or an interest therein will, by such acquisition or acceptance,
     be deemed to have  represented and warranted to and for the benefit of each
     Owner Participant and the Company that either (i) the assets of an employee
     benefit plan subject to Title I of the Employee  Retirement Income Security
     Act of 1974, as amended ("ERISA"),  or of a plan subject to Section 4975 of
     the Internal  Revenue Code of 1986, as amended (the "CODE"),  have not been
     used to purchase Series 1997-3B Certificates or an interest therein or (ii)
     the purchase and holding of Series 1997-3B Certificates or interest therein
     are exempt from the prohibited  transaction  restrictions  of ERISA and the
     Code  pursuant  to  one  or  more  prohibited   transaction   statutory  or
     administrative exemptions.

          (ii) The Series 1997-3B Certificates shall be Book-Entry  Certificates
     and  shall  be  subject  to the  conditions  set  forth  in the  Letter  of
     Representations  between the Company,  the Trustee and the Clearing  Agency
     attached hereto as Exhibit B.


<PAGE>


          (f) The  Scheduled  Payments  of  principal  shall be as set  forth in
     Exhibit C hereto.

          (g)  All  or  a  portion  of  the  proceeds  of  the  Series   1997-3B
     Certificates shall be used to purchase the Equipment Notes in the principal
     amounts  specified  below and the unused portion of such proceeds,  if any,
     shall be deposited in the Escrow  Account to be applied as set forth in the
     Agreement:


<TABLE>
<CAPTION>
           REGISTRATION NUMBER                  PRINCIPAL AMOUNT
           -------------------                  ----------------
           <S>                                       <C>       
           N14925................................... $1,989,000
           N15926...................................  1,989,000
           N16927...................................  1,989,000
           N17928...................................  2,516,000
           N13929...................................  2,516,000
           N14930...................................  2,183,000
           N14931...................................  2,183,000
           N15932...................................  2,183,000
           N14933...................................  2,183,000
</TABLE>


          (h) Each  Owner  Trustee,  acting on behalf  of its  respective  Owner
     Participant,  will issue, on a non-recourse basis, the Equipment Notes, the
     proceeds  of which shall be used,  among other  things,  to  refinance  the
     outstanding debt portion of the purchase price to such Owner Trustee of the
     following Aircraft:


<TABLE>
<CAPTION>
   REGISTRATION NUMBER             AIRCRAFT TYPE              ENGINE TYPE
   -------------------             -------------              -----------
         <S>                      <C>                          <C>
         N14925                   Embraer EMB-145              AE3007A
         N15926                   Embraer EMB-145              AE3007A
         N16927                   Embraer EMB-145              AE3007A
         N17928                   Embraer EMB-145              AE3007A
         N13929                   Embraer EMB-145              AE3007A
         N14930                   Embraer EMB-145              AE3007A
         N14931                   Embraer EMB-145              AE3007A
         N15932                   Embraer EMB-145              AE3007A
         N14933                   Embraer EMB-145              AE3007A

</TABLE>


          (i) The related Note Documents are listed on Exhibit D.

          (j) Notice of any  termination  of the  1997-3B  Trust shall be mailed
     promptly by the Trustee to the Class B Certificateholders  not earlier than
     the 60th day and not  later  than the  15th day next  preceding  the  final
     distribution pursuant to the Agreement.

          (k) Except as contemplated by Section 2.02(b) of the Basic  Agreement,
     there  will be no  deposit  agreement  or  other  arrangement  prior to the
     delivery of any Aircraft.

          (l) The Series 1997-3B  Certificates are subject to the  Intercreditor
     Agreement.


<PAGE>


          (m) The  Series  1997-3B  Certificates  will have the  benefit  of the
     Liquidity Facility.

          (n) The Responsible Party is the Company.

          (o) The Final Legal Distribution Date is December 24, 2008.

          (p) The  particular  "sections of the Note  Purchase  Agreement",  for
     purposes of clause (3) of Section 7.07 of the Basic Agreement,  are Section
     9.1 of each Note Purchase Agreement.

                                   ARTICLE II

                           DEFINITIONS AND AMENDMENTS

          Section 2.01. DEFINITIONS.  For all purposes of the Basic Agreement as
supplemented by this Trust  Supplement,  the following  capitalized  terms shall
have the following meanings:

          CLASS B  CERTIFICATEHOLDER:  Means the  Person in whose  name a Series
     1997-3B  Certificate  is registered on the Register for the Series  1997-3B
     Certificates.

          INTERCREDITOR AGREEMENT: Means the Intercreditor Agreement dated as of
     the date  hereof  among the  Trustee,  the Other  Trustees,  the  Liquidity
     Provider named therein and Wilmington Trust Company, as Subordination Agent
     and as trustee, as amended, supplemented or otherwise modified from time to
     time in accordance with its terms.

          LIQUIDITY  FACILITY:  Means the Revolving Credit Agreement dated as of
     the date hereof among Wilmington Trust Company,  as Subordination Agent and
     trustee for the 1997-3B Trust, and ABN AMRO Bank, N.V.,  acting through its
     Chicago Branch, as amended,  replaced,  supplemented or otherwise  modified
     from  time to time in  accordance  with  its  terms  and the  terms  of the
     Intercreditor Agreement..

          OTHER  AGREEMENTS:  Means (i) the Basic  Agreement as  supplemented by
     Trust  Supplement  1997-3A  dated as of the  date  hereof  relating  to the
     Continental  Airlines Pass Through Trust  created  thereunder  and (ii) the
     Basic Agreement as  supplemented by Trust  Supplement No. 1997-3C dated the
     date hereof relating to the Continental Airlines Pass Through Trust created
     thereunder.

          OTHER TRUSTEES: Means each of the trustees under the Other Agreements,
     and any  successor  thereunder  or  other  trustee  appointed  as  provided
     therein.

          PTC EVENT OF  DEFAULT:  Means the  failure to pay within ten  Business
     Days of the due date  thereof:  (i) the  outstanding  Pool  Balance  of the
     Series 1997-3B  Certificates on the Final Legal  Distribution Date for such
     Series  1997-3B  Certificates  or (ii) interest due on such Series  1997-3B
     Certificates on any Distribution Date (unless the Subordination Agent shall
     have made an Interest Drawing or Drawings (as defined in the  Intercreditor


<PAGE>

     Agreement),  or a withdrawal or withdrawals  pursuant to a cash  collateral
     account  under the  Intercreditor  Agreement,  with  respect  thereto in an
     aggregate amount sufficient to pay such interest and shall have distributed
     such amount to the Trustee).

          Section   2.02.   AMENDMENTS.   Solely  for  purposes  of  this  Trust
Supplement,  Section  2.02(b) of the Basic Agreement shall be amended to read as
follows:

          (b) If on or prior to the  Issuance  Date with  respect to a series of
     Certificates the Company shall deliver to the Trustee a Postponement Notice
     relating to one or more  Postponed  Notes,  the Trustee shall  postpone the
     purchase of such  Postponed  Notes and shall deposit into an escrow account
     (as to such Trust,  the "ESCROW  ACCOUNT") to be  maintained as part of the
     related Trust an amount equal to the purchase price of such Postponed Notes
     (the "ESCROWED Funds"). The portion of the Escrowed Funds so deposited with
     respect to any particular  Postponed Notes shall be invested by the Trustee
     at the written direction of the Responsible Party in Specified  Investments
     (i) maturing no later than any  scheduled  Transfer  Date  relating to such
     Postponed  Notes  or (ii) if no such  Transfer  Date  has  been  scheduled,
     maturing on the next Business Day, or (iii) if the Company has given notice
     to the Trustee that such  Postponed  Notes will not be issued,  maturing on
     the next  applicable  Special  Distribution  Date, if such  investments are
     reasonably available for purchase.  The Trustee shall make withdrawals from
     the Escrow Account only as provided in this Agreement.  Upon request of the
     Company  on one or more  occasions  and the  satisfaction  or waiver of the
     closing conditions  specified in the applicable Note Purchase Agreements on
     or prior to the related  Cut-off  Date,  the  Trustee  shall  purchase  the
     applicable  Postponed  Notes with the  Escrowed  Funds  withdrawn  from the
     Escrow Account. The purchase price shall equal the principal amount of such
     Postponed Notes.

          The Trustee  shall hold all Specified  Investments  until the maturity
     thereof and will not sell or otherwise transfer Specified  Investments.  If
     Specified  Investments  held  in an  Escrow  Account  mature  prior  to any
     applicable  Transfer  Date,  any proceeds  received on the maturity of such
     Specified Investments  (including any earnings thereon) shall be reinvested
     by the  Trustee  at the  written  direction  of the  Responsible  Party  in
     Specified Investments maturing as provided in the preceding paragraph.  The
     Responsible  Party shall pay to the  Trustee  for  deposit to the  relevant
     Escrow Account an amount equal to any losses on such Specified  Investments
     as incurred.

          On  the  Initial   Regular   Distribution   Date  in  respect  of  the
     Certificates of any series,  the Responsible Party will pay (in immediately
     available  funds) to the Trustee an amount equal to (i) the  interest  that
     would  have   accrued  on  any   Postponed   Notes  with  respect  to  such
     Certificates,  if any,  purchased after the Issuance Date if such Postponed
     Notes had been purchased on the Issuance  Date,  from the Issuance Date to,
     but not including,  the date of the purchase of such Postponed Notes by the
     Trustee minus (ii) the earnings on Specified Investments  (disregarding any
     losses  thereon)  received (with respect to the portion of the Escrow Funds
     deposited  with respect to the Postponed  Notes  described in clause (i) of


<PAGE>


     this paragraph) by the Trustee from and including the Issuance Date to, but
     not including, the Initial Regular Distribution Date.

          If, in respect of the Certificates of any series, the Company notifies
     the Trustee prior to the Cut-off Date that any Postponed  Notes will not be
     issued on or prior to the Cut-off Date for any reason,  on the next Special
     Distribution  Date for such  Certificates  occurring  not less than 15 days
     following the date of such notice,  (i) the Responsible  Party shall pay to
     the  Trustee  for  deposit in the  related  Special  Payments  Account,  in
     immediately available funds, an amount equal to (A) the interest that would
     have accrued on the  Postponed  Notes  designated  in such notice at a rate
     equal  to the  interest  rate  applicable  to such  Certificates  from  the
     Issuance Date to, but not including,  such Special  Distribution Date minus
     (B) the earnings on Specified Investments (disregarding any losses thereon)
     received (with respect to the portion of the Escrowed Funds  deposited with
     respect to the  Postponed  Notes  designated in such notice) by the Trustee
     from and including the Issuance  Date to, but not  including,  such Special
     Distribution  Date and (ii) the Trustee  shall  transfer an amount equal to
     that  amount of Escrowed  Funds that would have been used to  purchase  the
     Postponed  Notes  designated  in such  notice  and the  amount  paid by the
     Responsible  Party pursuant to the immediately  preceding clause (i) to the
     related Special  Payments  Account for distribution as a Special Payment in
     accordance with the provisions hereof.

          If, on such  Cut-off  Date,  an  amount  equal to less than all of the
     Escrowed Funds (other than Escrowed  Funds  referred to in the  immediately
     preceding paragraph) has been used to purchase Postponed Notes, on the next
     such Special  Distribution  Date  occurring not less than 15 days following
     such Cut-off Date, (i) the  Responsible  Party shall pay to the Trustee for
     deposit in such Special Payments Account,  in immediately  available funds,
     an  amount  equal to (A) the  interest  that  would  have  accrued  on such
     Postponed  Notes  contemplated  to be purchased  with such unused  Escrowed
     Funds (other than Escrowed Funds referred to in the  immediately  preceding
     paragraph)  but not so  purchased  at a rate  equal  to the  interest  rate
     applicable  to  such  Certificates  from  the  Issuance  Date  to,  but not
     including,  such  Special  Distribution  Date  minus  (B) the  earnings  on
     Specified  Investments  (disregarding  any losses  thereon)  received (with
     respect to the portion of the Escrowed Funds  deposited with respect to the
     Postponed  Notes  contemplated  to be purchased  with such unused  Escrowed
     Funds (other than Escrowed Funds referred to in the  immediately  preceding
     paragraph)  but not so  purchased)  by the Trustee from and  including  the
     Issuance Date to, but not  including,  such Special  Distribution  Date and
     (ii) the Trustee shall  transfer such unused  Escrowed Funds and the amount
     paid by the Responsible Party pursuant to the immediately  preceding clause
     (i) to such Special  Payments Account for distribution as a Special Payment
     in accordance with the provisions hereof.


<PAGE>


                                   ARTICLE III

                                     DEFAULT

          Section 3.01. PURCHASE RIGHTS OF  CERTIFICATEHOLDERS.  (a) At any time
after the occurrence  and during the  continuance  of a Triggering  Event,  each
Class B  Certificateholder  shall have the right to  purchase,  for the purchase
price and otherwise in accordance  with and subject to the  provisions set forth
in Section  6.01(b) of the Basic  Agreement,  all, but not less than all, of the
Class A  Certificates  upon ten days' written  notice to the Class A Trustee and
each other Class B  Certificateholder,  provided that (i) if prior to the end of
such ten day period any other Class B Certificateholder notifies such purchasing
Class B  Certificateholder  that such other Class B  Certificateholder  wants to
participate in such purchase, then such other Class B Certificateholder may join
with the purchasing Class B Certificateholder to purchase all, but not less than
all,  of the Class A  Certificates  pro rata based on the  Fractional  Undivided
Interest in the 1997-3B  Trust held by each such Class B  Certificateholder  and
(ii)  if  prior  to  the  end  of  such   ten-day   period  any  other  Class  B
Certificateholder  fails to notify the purchasing Class B  Certificateholder  of
such other Class B Certificateholder's desire to participate in such a purchase,
then such other Class B  Certificateholder  shall lose its right to purchase the
Class A Certificates  pursuant to this Section and Section  6.01(b) of the Basic
Agreement; and

          (b) By  acceptance  of its Series  1997-3B  Certificate,  each Class B
Certificateholder  agrees that at any time after the  occurrence  and during the
continuation of a Triggering  Event, each Class C  Certificateholder  shall have
the right (which shall not expire upon any purchase of the Class A  Certificates
pursuant  to  paragraph  (a)  above) to  purchase,  for the  purchase  price and
otherwise in accordance  with and subject to the provisions set forth in Section
6.01(b)  of the Basic  Agreement,  all,  but not less  than all,  of the Class A
Certificates and the Series 1997-3B  Certificates  upon ten days' written notice
to the Class A Trustee,  the Trustee  and each other Class C  Certificateholder,
provided  that (i) if prior to the end of such ten-day  period any other Class C
Certificateholder  notifies such purchasing Class C Certificateholder  that such
other Class C Certificateholder wants to participate in such purchase, then such
other  Class  C   Certificateholder   may  join  with  the  purchasing  Class  C
Certificateholder  to  purchase  all,  but not less  than  all,  of the  Class A
Certificates  and  the  Series  1997-3B  Certificates  pro  rata  based  on  the
Fractional  Undivided  Interest  in the Class C Trust  held by each such Class C
Certificateholder  and (B) if prior to the end of such ten-day  period any other
Class  C   Certificateholder   fails   to   notify   the   purchasing   Class  C
Certificateholder   of  such  other  Class  C   Certificateholder's   desire  to
participate in such a purchase,  then such other Class C Certificateholder shall
lose its right to  purchase  the Class A  Certificates  and the  Series  1997-3B
Certificates  pursuant  to  this  Section  and  Section  6.01(b)  of  the  Basic
Agreement.

          (c) As used in this  Article  III,  the terms  "Class A  Certificate",
"Class A Trustee",  "Class C  Certificateholder"  and "Class C Trust" shall have
the respective meanings assigned to such terms in the Intercreditor Agreement.


<PAGE>


                                   ARTICLE IV

                                   THE TRUSTEE

          Section 4.01. THE TRUSTEE.  The Trustee is hereby  directed to execute
and deliver the Intercreditor  Agreement on or prior to the Issuance Date in the
form  delivered  to the  Trustee  by  the  Company.  The  Trustee  shall  not be
responsible  in any  manner  whatsoever  for or in respect  of the  validity  or
sufficiency of this Trust Supplement or the due execution hereof by the Company,
or for or in respect of the recitals and  statements  contained  herein,  all of
which recitals and statements are made solely by the Company.

          The Trustee, upon the execution and delivery of this Trust Supplement,
acknowledges its acceptance of all right, title and interest in and to the Trust
Property  with respect to the 1997-3B  Trust and declares that the Trustee holds
and will hold such right, title and interest for the benefit of all then present
and future  Class B  Certificateholders,  upon the trusts set forth in the Basic
Agreement and this Trust  Supplement.  By its  acceptance of each Series 1997-3B
Certificate   issued  to  it  under  the   Agreement,   each  initial   Class  B
Certificateholder  as grantor of the 1997-3B Trust thereby joins in the creation
and declaration of the Trust.

          Except as herein otherwise  provided,  no duties,  responsibilities or
liabilities are assumed,  or shall be construed to be assumed, by the Trustee by
reason of this Trust  Supplement other than as set forth in the Basic Agreement,
and this Trust  Supplement  is executed  and  accepted on behalf of the Trustee,
subject to all the terms and conditions set forth in the Basic  Agreement,  upon
the effectiveness thereof, as if the same were herein set forth at length.

          The Trustee  represents and warrants that the Intercreditor  Agreement
will  be  duly  executed  and  delivered  by  one of its  officers  who is  duly
authorized to execute and deliver such document on its behalf.

                                    ARTICLE V

                            MISCELLANEOUS PROVISIONS

          Section  5.01.  BASIC  AGREEMENT  MODIFIED  AND  RATIFIED.  The  Basic
Agreement is  incorporated  herein by reference  in its  entirety,  and shall be
deemed to be a part of this Trust Supplement as if set forth in full herein, and
is in all respects ratified and confirmed,  as supplemented and modified by this
Trust Supplement.

          Section 5.02.  GOVERNING  LAW. THIS TRUST  SUPPLEMENT  AND THE CLASS B
CERTIFICATES  SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE  WITH THE LAWS OF
THE STATE OF NEW YORK.

          Section 5.03. EXECUTION IN COUNTERPARTS.  This Trust Supplement may be
executed in any number of counterparts,  each of which shall be an original, but
such counterparts shall together constitute but one and the same instrument.




<PAGE>



          IN WITNESS WHEREOF, the Company and the Trustee have caused this Trust
Supplement  to be duly  executed by their  respective  officers  thereunto  duly
authorized, as of the day and year first written above.

                                       CONTINENTAL AIRLINES, INC.



                                       By: ___________________________________
                                           Name:
                                           Title:



                                       WILMINGTON TRUST COMPANY,
                                           as Trustee



                                       By: ___________________________________
                                           Name:
                                           Title:



<PAGE>


                                    EXHIBIT A
                                    ---------

                               Form of Certificate

          [Include on each Certificate that is a Global Certificate: Unless this
certificate is presented by an authorized representative of The Depository Trust
Company, a New York corporation ("DTC"), to Issuer or its agent for registration
of transfer,  exchange or payment,  and any certificate  issued is registered in
the name of Cede & Co. or in such other name as is  requested  by an  authorized
representative  of DTC (and any  payment  is made to Cede & Co. or to such other
entity as is requested by an authorized  representative  of DTC),  ANY TRANSFER,
PLEDGE  OR OTHER  USE  HEREOF  FOR  VALUE OR  OTHERWISE  BY OR TO ANY  PERSON IS
WRONGFUL  inasmuch as the registered  owner hereof,  Cede & Co., has an interest
herein.]<F1>


                 CONTINENTAL AIRLINES 1997-3B PASS THROUGH TRUST

                            Pass Through Certificate,
                                 Series 1997-3B

                        Issuance Date: September 25, 1997

                 Final Expected Distribution Date: June 24, 2007

          evidencing a fractional  undivided  interest in a 1997-3B  Trust,
          the property of which  includes  certain  equipment  notes each
          secured by aircraft leased to Continental Airlines, Inc.

Certificate
No._____         $________ Fractional Undivided Interest representing 0.0050682%
                 of the Trust per $1,000 of face amount


          THIS  CERTIFIES  THAT  ____________,   for  value  received,   is  the
registered  owner  of  a  $__________  (_______  dollars)  Fractional  Undivided
Interest in the  Continental  Airlines Pass Through  Trust,  Series 1997-3B (the
"TRUST")  created by  Wilmington  Trust  Company,  as trustee  (the  "TRUSTEE"),
pursuant to a Pass Through Trust Agreement,  dated as of September 25, 1997 (the
"BASIC  AGREEMENT"),  as supplemented by Trust  Supplement No. 1997-3B  thereto,
dated as of  September  25, 1997  (collectively,  the  "AGREEMENT")  between the
Trustee and Continental Airlines, Inc., a Delaware corporation (the "COMPANY" or
the "ISSUER"),  a summary of certain of the pertinent provisions of which is set
forth below. To the extent not otherwise  defined herein,  the capitalized terms
used  herein  have  the  meanings  assigned  to  them  in  the  Agreement.  This
Certificate  is  one  of  the  duly   authorized   Certificates   designated  as
"Continental Airlines Pass Through Certificates,  Series 1997-3B" (herein called


_________

<F1> This legend to appear on Book-Entry  Certificates  to be deposited with The
     Depository Trust Company.



<PAGE>




the  "CERTIFICATES").  This  Certificate  is issued  under and is subject to the
terms,  provisions and conditions of the Agreement.  By virtue of its acceptance
hereof, the  Certificateholder  of this Certificate  assents to and agrees to be
bound by the provisions of the Agreement and the  Intercreditor  Agreement.  The
property of the Trust  includes  certain  Equipment  Notes and all rights of the
Trust to receive  payments under the  Intercreditor  Agreement and the Liquidity
Facility (the "TRUST  PROPERTY").  Each issue of the Equipment  Notes is secured
by, among other things, a security interest in aircraft leased to the Company.

          The Certificates represent fractional undivided interests in the Trust
and the Trust Property,  and have no rights,  benefits or interest in respect of
any  other  separate  trust  established  pursuant  to the  terms  of the  Basic
Agreement for any other series of certificates issued pursuant thereto.

          Subject to and in  accordance  with the terms of the Agreement and the
Intercreditor Agreement, from funds then available to the Trustee, there will be
distributed on each March 24, June 24,  September 24 and December 24 (a "REGULAR
DISTRIBUTION  DATE"),  commencing  on December 24, 1997,  to the Person in whose
name this  Certificate  is  registered  at the close of business on the 15th day
preceding the Regular  Distribution  Date, an amount in respect of the Scheduled
Payments on the  Equipment  Notes due on such  Regular  Distribution  Date,  the
receipt of which has been confirmed by the Trustee,  equal to the product of the
percentage  interest in the Trust  evidenced by this  Certificate  and an amount
equal to the sum of such Scheduled  Payments.  Subject to and in accordance with
the terms of the Agreement and the  Intercreditor  Agreement,  in the event that
Special Payments on the Equipment Notes are received by the Trustee,  from funds
then  available to the Trustee,  there shall be  distributed  on the  applicable
Special  Distribution  Date,  to the  Person in whose name this  Certificate  is
registered  at the  close of  business  on the 15th day  preceding  the  Special
Distribution  Date,  an  amount  in  respect  of such  Special  Payments  on the
Equipment Notes,  the receipt of which has been confirmed by the Trustee,  equal
to the  product  of the  percentage  interest  in the  Trust  evidenced  by this
Certificate and an amount equal to the sum of such Special Payments so received.
If a Regular  Distribution  Date or Special  Distribution Date is not a Business
Day,  distribution shall be made on the immediately  following Business Day with
the same  force  and  effect  as if made on such  Regular  Distribution  Date or
Special  Distribution  Date and no interest shall accrue during the  intervening
period.  The Trustee  shall mail notice of each Special  Payment and the Special
Distribution Date therefor to the Certificateholder of this Certificate.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the Person entitled thereto,  without the presentation or surrender of
this  Certificate  or the making of any  notation  hereon.  Except as  otherwise
provided in the Agreement and  notwithstanding the above, the final distribution
on this  Certificate  will be made  after  notice  mailed by the  Trustee of the
pendency of such  distribution and only upon  presentation and surrender of this
Certificate at the office or agency of the Trustee specified in such notice.

          The  Certificates  do not  represent  a direct  obligation  of,  or an
obligation  guaranteed  by, or an interest in, the Company or the Trustee or any


<PAGE>


affiliate thereof. The Certificates are limited in right of payment, all as more
specifically set forth on the face hereof and in the Agreement.  All payments or
distributions made to Certificateholders  under the Agreement shall be made only
from the Trust  Property  and only to the  extent  that the  Trustee  shall have
sufficient  income or proceeds from the Trust  Property to make such payments in
accordance  with the  terms of the  Agreement.  Each  Certificateholder  of this
Certificate,  by its acceptance  hereof,  agrees that it will look solely to the
income  and  proceeds  from the  Trust  Property  to the  extent  available  for
distribution  to such  Certificateholder  as  provided  in the  Agreement.  This
Certificate does not purport to summarize the Agreement and reference is made to
the Agreement for information with respect to the interests,  rights,  benefits,
obligations,  proceeds, and duties evidenced hereby. A copy of the Agreement may
be examined during normal business hours at the principal office of the Trustee,
and  at  such  other  places,  if  any,   designated  by  the  Trustee,  by  any
Certificateholder upon request.

          The Agreement permits,  with certain exceptions therein provided,  the
amendment  thereof and the  modification  of the rights and  obligations  of the
Company and the rights of the Certificateholders under the Agreement at any time
by the  Company  and the  Trustee  with the  consent  of the  Certificateholders
holding Certificates  evidencing  Fractional Undivided Interests aggregating not
less  than a  majority  in  interest  in the  Trust.  Any  such  consent  by the
Certificateholder  of this  Certificate  shall be conclusive and binding on such
Certificateholder and upon all future Certificateholders of this Certificate and
of any  Certificate  issued upon the transfer hereof or in exchange hereof or in
lieu  hereof  whether  or not  notation  of  such  consent  is  made  upon  this
Certificate.  The  Agreement  also  permits the  amendment  thereof,  in certain
limited  circumstances,  without the consent of the Certificateholders of any of
the Certificates.

          As provided in the  Agreement and subject to certain  limitations  set
forth therein,  the transfer of this  Certificate is registrable in the Register
upon surrender of this  Certificate for  registration of transfer at the offices
or agencies  maintained by the Trustee in its capacity as  Registrar,  or by any
successor  Registrar  duly endorsed or  accompanied  by a written  instrument of
transfer in form satisfactory to the Trustee and the Registrar, duly executed by
the  Certificateholder   hereof  or  such   Certificateholder's   attorney  duly
authorized in writing,  and thereupon one or more new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest in the
Trust will be issued to the designated transferee or transferees.

          The Certificates are issuable only as registered  Certificates without
coupons in minimum  denominations of $1,000  Fractional  Undivided  Interest and
integral  multiples  thereof  except  that one  Certificate  may be  issued in a
different  denomination.  As  provided in the  Agreement  and subject to certain
limitations  therein  set  forth,  the  Certificates  are  exchangeable  for new
Certificates   of  authorized   denominations   evidencing  the  same  aggregate
Fractional   Undivided   Interest   in   the   Trust,   as   requested   by  the
Certificateholder surrendering the same.

          No service charge will be made for any such  registration  of transfer
or exchange,  but the Trustee shall require payment of a sum sufficient to cover
any tax or governmental charge payable in connection therewith.


<PAGE>


          The  Trustee,  the  Registrar,  and any  agent of the  Trustee  or the
Registrar may treat the person in whose name this  Certificate  is registered as
the owner hereof for all purposes,  and neither the Trustee, the Registrar,  nor
any such agent shall be affected by any notice to the contrary.

          The obligations and responsibilities  created by the Agreement and the
Trust   created   thereby   shall    terminate   upon   the    distribution   to
Certificateholders of all amounts required to be distributed to them pursuant to
the  Agreement  and the  disposition  of all property  held as part of the Trust
Property.

          Any Person  acquiring or  accepting  this  Certificate  or an interest
herein will, by such  acquisition or acceptance,  be deemed to have  represented
and warranted to and for the benefit of each Owner  Participant  and the Company
that  either:  (i) the assets of an employee  benefit plan subject to Title I of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or of
a plan subject to Section 4975 of the Internal  Revenue Code of 1986, as amended
(the  "CODE"),  have not been used to purchase this  Certificate  or an interest
herein or (ii) the purchase and holding of this  Certificate or interest  herein
are exempt from the prohibited  transaction  restrictions  of ERISA and the Code
pursuant  to one or more  prohibited  transaction  statutory  or  administration
exemptions.

          THIS  CERTIFICATE  AND THE AGREEMENT  HAVE EACH BEEN  DELIVERED IN THE
STATE OF NEW YORK AND  SHALL BE  CONSTRUED  IN  ACCORDANCE  WITH THE LAWS OF THE
STATE  OF  NEW  YORK  AND  THE   OBLIGATIONS,   RIGHTS  AND   REMEDIES   OF  THE
CERTIFICATEHOLDERS  HEREUNDER AND THE PARTIES  THEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

          Unless the certificate of  authentication  hereon has been executed by
the Trustee, by manual signature,  this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.




<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

                                       CONTINENTAL AIRLINES 1997-3B PASS
                                       THROUGH TRUST

                                       By:  WILMINGTON TRUST COMPANY,
                                               as Trustee



                                       By: _______________________________
                                       Title:_____________________________

Dated: ______________




<PAGE>


               FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION

          This is one of the  Certificates  referred to in the  within-mentioned
Agreement.


                                     WILMINGTON TRUST COMPANY,
                                     as Trustee


                                     By: _______________________________________
                                         Name:
                                         Title:



<PAGE>


                                    EXHIBIT B
                                    ---------

                          DTC Letter of Representations




<PAGE>


                                    EXHIBIT C
                                    ---------


<TABLE>
<CAPTION>
                           Regular Distribution Dates
                                       and
                               Scheduled Payments


       DATE                                    SCHEDULED PAYMENTS OF PRINCIPAL
       ----                                    -------------------------------

<S>                                                    <C>
December 24, 1997.................................     $  193,210
March 24, 1998....................................         83,136
June 24, 1998.....................................        268,625
September 24, 1998................................       589,100
December 24, 1998.................................        193,210
March 24, 1999....................................        125,414
June 24, 1999.....................................        226,267
September 24, 1999................................        589,100
December 24, 1999.................................        193,210
March 24, 2000....................................        112,156
June 24, 2000.....................................        239,527
September 24, 2000................................        589,100
December 24, 2000.................................        193,210
March 24, 2001....................................         98,898
June 24, 2001.....................................        252,785
September 24, 2001................................        589,100
December 24, 2001.................................        193,210
March 24, 2002....................................         85,640
June 24, 2002.....................................        266,043
September 24, 2002................................        589,100
December 24, 2002.................................        193,210
March 24, 2003....................................         83,088
June 24, 2003.....................................        268,595
September 24, 2003................................        654,814
December 24, 2003.................................        342,734
March 24, 2004....................................        278,670
June 24, 2004.....................................        941,351
September 24, 2004................................        684,136
December 24, 2004.................................        534,524
March 24, 2005....................................        785,204
June 24, 2005.....................................        751,447
September 24, 2005................................        797,890
December 24, 2005.................................        205,858
March 24, 2006....................................      1,642,589
June 24, 2006.....................................        926,396
September 24, 2006................................      1,403,842
December 24, 2006.................................        370,976
March 24, 2007....................................      1,789,232
June 24, 2007.....................................      1,406,403

</TABLE>




<PAGE>


                                    EXHIBIT D
                                    ---------

                             Related Note Documents

                      [Information to be added upon receipt
                             of HHR's Closing memo]






                          TRUST SUPPLEMENT NO. 1997-3C

                            Dated September 25, 1997



                                     between



                            WILMINGTON TRUST COMPANY,
                                   as Trustee,



                                       and



                           CONTINENTAL AIRLINES, INC.



                                       to



                          PASS THROUGH TRUST AGREEMENT
                         Dated as of September 25, 1997



                                   $14,418,000


                           Continental Airlines, Inc.
                           Pass Through Trust, 1997-3C

                           Continental Airlines, Inc.
                        1997-3 Pass Through Certificates,
                                     Class C




<PAGE>


<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

                          ARTICLE I - THE CERTIFICATES

<S>             <C>                                                          <C>
Section 1.01.   The Certificates ..............................................3


                     ARTICLE II - DEFINITIONS AND AMENDMENTS

Section 2.01.   Definitions ...................................................5
Section 2.02.   Amendments ....................................................6


                              ARTICLE III - DEFAULT

Section 3.01.   Purchase Rights of Certificateholders .........................8


                            ARTICLE IV - THE TRUSTEE

Section 4.01.   The Trustee ...................................................8


                      ARTICLE V - MISCELLANEOUS PROVISIONS

Section 5.01.   Basic Agreement Modified and Ratified .........................9
Section 5.02.   GOVERNING LAW .................................................9


EXHIBIT A       Form of Certificate
EXHIBIT B       DTC Letter of Representations
EXHIBIT C       Regular Distribution Dates and Scheduled Payments
EXHIBIT D       Related Note Documents

</TABLE>



<PAGE>


          This Trust  Supplement  No.  1997-3C,  dated as of September  25, 1997
(herein called the "TRUST SUPPLEMENT"),  between Continental  Airlines,  Inc., a
Delaware  corporation  (the  "COMPANY"),   and  Wilmington  Trust  Company  (the
"TRUSTEE"), to the Pass Through Trust Agreement, dated as of September 25,
 1997,
between the Company and the Trustee (the "BASIC AGREEMENT").

                              W I T N E S S E T H:
                              - - - - - - - - - -

          WHEREAS, the Basic Agreement,  unlimited as to the aggregate principal
amount of Certificates  (unless otherwise  specified  herein,  capitalized terms
used  herein  without  definition  having  the  respective   meanings  specified
heretofore  in  the  Basic  Agreement)  which  may  be  issued  thereunder,  has
heretofore been executed and delivered;

          WHEREAS, each Owner Trustee,  acting on behalf of its respective Owner
Participant,  will issue, on a non-recourse basis,  Equipment Notes, among other
things,  to refinance the outstanding  debt portion of the purchase price of the
aircraft  purchased by such Owner Trustee and leased to the Company  pursuant to
the related Lease;

          WHEREAS,  pursuant to the terms and conditions of the Basic  Agreement
as supplemented by this Trust  Supplement (the  "AGREEMENT"),  the Trustee shall
purchase  such  Equipment  Notes  issued by each Owner  Trustee  having the same
interest  rate as, and final  maturity  dates not later than the final  expected
Regular  Distribution Date of, the Certificates  issued hereunder and shall hold
such Equipment Notes in trust for the benefit of the Class C Certificateholders;

          WHEREAS,  the Trustee hereby declares the creation of this Continental
Airlines  Pass Through  Trust,  Series  1997-3C (the "1997-3C  TRUST"),  for the
benefit  of  the  Class  C   Certificateholders,   and  the   initial   Class  C
Certificateholders  as the grantors of the 1997-3C  Trust,  by their  respective
acceptances of the Certificates  issued hereunder,  join in the creation of this
1997-3C Trust with the Trustee;

          WHEREAS, all of the conditions and requirements necessary to make this
Trust Supplement,  when duly executed and delivered,  a valid, binding and legal
instrument in accordance  with its terms and for the purposes  herein  expressed
have been done, performed and fulfilled,  and the execution and delivery of this
Trust Supplement in the form and with the terms hereof have been in all respects
duly authorized; and

          WHEREAS,  this Trust  Supplement  is subject to the  provisions of the
Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be
governed by such provisions;

          NOW, THEREFORE,  in consideration of the premises herein, it is agreed
between the Company and the Trustee as follows:



<PAGE>

                                    ARTICLE I

                                THE CERTIFICATES
                                ----------------

          Section 1.01.  THE  CERTIFICATES.  There is hereby created a series of
Certificates to be issued under the Agreement to be  distinguished  and known as
"Continental  Airlines Pass Through  Certificates,  Series 1997-3C" (hereinafter
defined as the "SERIES 1997-3C  CERTIFICATES").  Each Series 1997-3C Certificate
represents a fractional  undivided interest in the 1997-3C Trust created hereby.
The Series  1997-3C  Certificates  shall be the only  instruments  evidencing  a
fractional undivided interest in the 1997-3C Trust.

          The terms and conditions applicable to the Series 1997-3C Certificates
are as follows:

               (a)  The  aggregate   principal  amount  of  the  Series  1997-3C
          Certificates  that shall be authenticated  under the Agreement (except
          for Series 1997-3C  Certificates  authenticated and delivered pursuant
          to  Sections  3.03,   3.04  and  3.06  of  the  Basic   Agreement)  is
          $14,418,000.

               (b) The Cut-off Date is October 31, 1997.

               (c) The Regular  Distribution Date with respect to any payment of
          Scheduled  Payments means March 24, June 24, September 24 and December
          24,  commencing  on  December  24,  1997  until  payment of all of the
          Scheduled Payments to be made under the Equipment Notes has been made.

               (d) The  Special  Distribution  Date with  respect  to the Series
          1997-3C Certificates means any Business Day on which a Special Payment
          is to be distributed pursuant to the Agreement.

               (e) (i) The  Series  1997-3C  Certificates  shall  be in the form
          attached  hereto as Exhibit A. Any Person  acquiring  or  accepting  a
          Series  1997-3C  Certificate  or an  interest  therein  will,  by such
          acquisition or acceptance, be deemed to have represented and warranted
          to and for the benefit of each Owner  Participant and the Company that
          either (i) the assets of an employee  benefit  plan subject to Title I
          of the Employee  Retirement  Income  Security Act of 1974,  as amended
          ("ERISA"),  or of a plan  subject  to  Section  4975  of the  Internal
          Revenue Code of 1986, as amended (the  "CODE"),  have not been used to
          purchase Series 1997-3C  Certificates  or an interest  therein or (ii)
          the purchase and holding of Series  1997-3C  Certificates  or interest
          therein are exempt from the  prohibited  transaction  restrictions  of
          ERISA  and the Code  pursuant  to one or more  prohibited  transaction
          statutory or administrative exemptions.

               (ii)  The  Series  1997-3C   Certificates   shall  be  Book-Entry
          Certificates  and shall be subject to the  conditions set forth in the


<PAGE>

          Letter of  Representations  between the  Company,  the Trustee and the
          Clearing Agency attached hereto as Exhibit B.

               (f) The Scheduled  Payments of principal shall be as set forth in
          Exhibit C hereto.

               (g)  All or a  portion  of the  proceeds  of the  Series  1997-3C
          Certificates  shall be used to  purchase  the  Equipment  Notes in the
          principal  amounts  specified  below and the  unused  portion  of such
          proceeds,  if any,  shall be  deposited  in the  Escrow  Account to be
          applied as set forth in the Agreement:


<TABLE>
<CAPTION>

                REGISTRATION NUMBER                             PRINCIPAL AMOUNT
                -------------------                             ----------------
                     <S>                                           <C>
                     N14925........................................$1,692,000
                     N15926.........................................1,692,000
                     N16927.........................................1,692,000
                     N17928.........................................1,409,000
                     N13929.........................................1,409,000
                     N14930.........................................1,631,000
                     N14931.........................................1,631,000
                     N15932.........................................1,631,000
                     N14933.........................................1,631,000

</TABLE>


               (h) Each Owner Trustee,  acting on behalf of its respective Owner
          Participant, will issue, on a non-recourse basis, the Equipment Notes,
          the proceeds of which shall be used, among other things,  to refinance
          the  outstanding  debt  portion  of the  purchase  price to such Owner
          Trustee of the following Aircraft:


<TABLE>
<CAPTION>

         REGISTRATION NUMBER              AIRCRAFT TYPE           ENGINE TYPE
         -------------------              -------------           -----------
               <S>                       <C>                        <C>  
               N14925                    Embraer EMB-145            AE3007A
               N15926                    Embraer EMB-145            AE3007A
               N16927                    Embraer EMB-145            AE3007A
               N17928                    Embraer EMB-145            AE3007A
               N13929                    Embraer EMB-145            AE3007A
               N14930                    Embraer EMB-145            AE3007A
               N14931                    Embraer EMB-145            AE3007A
               N15932                    Embraer EMB-145            AE3007A
               N14933                    Embraer EMB-145            AE3007A

</TABLE>


               (i) The related Note Documents are listed on Exhibit D.

               (j)  Notice of any  termination  of the  1997-3C  Trust  shall be
          mailed promptly by the Trustee to the Class C  Certificateholders  not
          earlier  than  the  60th  day and not  later  than  the  15th day next
          preceding the final distribution pursuant to the Agreement.


<PAGE>

               (k)  Except  as  contemplated  by  Section  2.02(b)  of the Basic
          Agreement,  there will be no deposit  agreement  or other  arrangement
          prior to the delivery of any Aircraft.

               (l)  The  Series   1997-3C   Certificates   are  subject  to  the
          Intercreditor Agreement.

               (m) The Series 1997-3C  Certificates will have the benefit of the
          Liquidity Facility.

               (n) The Responsible Party is the Company.

               (o) The Final Legal Distribution Date is September 24, 2006.

               (p) The particular "sections of the Note Purchase Agreement", for
          purposes  of clause (3) of Section  7.07 of the Basic  Agreement,  are
          Section 9.1 of each Note Purchase Agreement.

                                   ARTICLE II

                           DEFINITIONS AND AMENDMENTS
                           --------------------------

          Section 2.01. DEFINITIONS.  For all purposes of the Basic Agreement as
supplemented by this Trust  Supplement,  the following  capitalized  terms shall
have the following meanings:

               CLASS C  CERTIFICATEHOLDER:  Means  the  Person  in whose  name a
          Series  1997-3C  Certificate  is  registered  on the  Register for the
          Series 1997-3C Certificates.

               INTERCREDITOR AGREEMENT:  Means the Intercreditor Agreement dated
          as of the date  hereof  among the  Trustee,  the Other  Trustees,  the
          Liquidity  Provider  named therein and Wilmington  Trust  Company,  as
          Subordination  Agent  and as  trustee,  as  amended,  supplemented  or
          otherwise modified from time to time in accordance with its terms.

               LIQUIDITY FACILITY: Means the Revolving Credit Agreement dated as
          of the date hereof among  Wilmington  Trust Company,  as Subordination
          Agent and  trustee  for the 1997-3C  Trust,  and ABN AMRO Bank,  N.V.,
          acting through its Chicago Branch, as amended, replaced,  supplemented
          or otherwise  modified from time to time in accordance  with its terms
          and the terms of the Intercreditor Agreement..

               OTHER  AGREEMENTS:  Means (i) the Basic Agreement as supplemented
          by Trust  Supplement  1997-3A dated as of the date hereof  relating to
          the  Continental  Airlines Pass Through Trust created  thereunder  and


<PAGE>

          (ii) the Basic  Agreement  as  supplemented  by Trust  Supplement  No.
          1997-3B  dated the date hereof  relating to the  Continental  Airlines
          Pass Through Trust created thereunder.

               OTHER  TRUSTEES:  Means  each of the  trustees  under  the  Other
          Agreements, and any successor thereunder or other trustee appointed as
          provided therein.

               PTC  EVENT OF  DEFAULT:  Means  the  failure  to pay  within  ten
          Business  Days of the due  date  thereof:  (i)  the  outstanding  Pool
          Balance  of  the  Series  1997-3C  Certificates  on  the  Final  Legal
          Distribution  Date  for  such  Series  1997-3C  Certificates  or  (ii)
          interest due on such Series 1997-3C  Certificates on any  Distribution
          Date  (unless  the  Subordination  Agent  shall have made an  Interest
          Drawing or Drawings (as defined in the Intercreditor  Agreement), or a
          withdrawal or withdrawals  pursuant to a cash collateral account under
          the  Intercreditor  Agreement,  with  respect  thereto in an aggregate
          amount sufficient to pay such interest and shall have distributed such
          amount to the Trustee).

          Section   2.02.   AMENDMENTS.   Solely  for  purposes  of  this  Trust
Supplement,  Section  2.02(b) of the Basic Agreement shall be amended to read as
follows:

               (b) If on or prior to the Issuance  Date with respect to a series
          of   Certificates   the  Company   shall  deliver  to  the  Trustee  a
          Postponement  Notice  relating  to one or more  Postponed  Notes,  the
          Trustee shall postpone the purchase of such Postponed  Notes and shall
          deposit  into  an  escrow  account  (as to  such  Trust,  the  "ESCROW
          ACCOUNT")  to be  maintained  as part of the  related  Trust an amount
          equal to the purchase  price of such  Postponed  Notes (the  "ESCROWED
          FUNDS").  The portion of the Escrowed  Funds so deposited with respect
          to any particular  Postponed Notes shall be invested by the Trustee at
          the  written   direction  of  the   Responsible   Party  in  Specified
          Investments  (i) maturing no later than any  scheduled  Transfer  Date
          relating to such Postponed  Notes or (ii) if no such Transfer Date has
          been  scheduled,  maturing on the next  Business  Day, or (iii) if the
          Company has given notice to the Trustee that such Postponed Notes will
          not be issued,  maturing on the next applicable  Special  Distribution
          Date, if such investments are reasonably  available for purchase.  The
          Trustee  shall  make  withdrawals  from  the  Escrow  Account  only as
          provided in this Agreement. Upon request of the Company on one or more
          occasions  and the  satisfaction  or waiver of the closing  conditions
          specified in the  applicable  Note Purchase  Agreements on or prior to
          the related  Cut-off Date,  the Trustee shall  purchase the applicable
          Postponed  Notes with the  Escrowed  Funds  withdrawn  from the Escrow
          Account.  The purchase price shall equal the principal  amount of such
          Postponed Notes.

               The  Trustee  shall  hold all  Specified  Investments  until  the
          maturity  thereof and will not sell or  otherwise  transfer  Specified
          Investments. If Specified Investments held in an Escrow Account mature
          prior to any applicable  Transfer  Date, any proceeds  received on the
          maturity  of  such  Specified  Investments   (including  any  earnings
          thereon)  shall be reinvested by the Trustee at the written  direction


<PAGE>

          of the Responsible Party in Specified Investments maturing as provided
          in the preceding  paragraph.  The  Responsible  Party shall pay to the
          Trustee for deposit to the relevant  Escrow Account an amount equal to
          any losses on such Specified Investments as incurred.

               On the  Initial  Regular  Distribution  Date  in  respect  of the
          Certificates  of any  series,  the  Responsible  Party  will  pay  (in
          immediately available funds) to the Trustee an amount equal to (i) the
          interest that would have accrued on any  Postponed  Notes with respect
          to such  Certificates,  if any,  purchased  after the Issuance Date if
          such Postponed Notes had been purchased on the Issuance Date, from the
          Issuance Date to, but not including,  the date of the purchase of such
          Postponed  Notes by the Trustee  minus (ii) the  earnings on Specified
          Investments  (disregarding  any losses thereon) received (with respect
          to the  portion  of the Escrow  Funds  deposited  with  respect to the
          Postponed  Notes  described  in clause (i) of this  paragraph)  by the
          Trustee from and including  the Issuance  Date to, but not  including,
          the Initial Regular Distribution Date.

               If, in respect of the  Certificates  of any  series,  the Company
          notifies  the  Trustee  prior to the Cut-off  Date that any  Postponed
          Notes  will not be  issued  on or prior  to the  Cut-off  Date for any
          reason,  on the next Special  Distribution  Date for such Certificates
          occurring not less than 15 days following the date of such notice, (i)
          the  Responsible  Party  shall pay to the  Trustee  for deposit in the
          related Special Payments Account,  in immediately  available funds, an
          amount  equal to (A) the  interest  that  would  have  accrued  on the
          Postponed  Notes  designated  in such  notice  at a rate  equal to the
          interest rate applicable to such  Certificates  from the Issuance Date
          to, but not including,  such Special  Distribution  Date minus (B) the
          earnings on Specified  Investments  (disregarding  any losses thereon)
          received (with respect to the portion of the Escrowed Funds  deposited
          with respect to the Postponed Notes  designated in such notice) by the
          Trustee from and including  the Issuance  Date to, but not  including,
          such Special  Distribution Date and (ii) the Trustee shall transfer an
          amount  equal to that  amount of  Escrowed  Funds that would have been
          used to purchase the Postponed Notes designated in such notice and the
          amount  paid by the  Responsible  Party  pursuant  to the  immediately
          preceding  clause (i) to the  related  Special  Payments  Account  for
          distribution  as a Special  Payment in accordance  with the provisions
          hereof.

               If, on such Cut-off Date, an amount equal to less than all of the
          Escrowed   Funds  (other  than  Escrowed  Funds  referred  to  in  the
          immediately  preceding  paragraph) has been used to purchase Postponed
          Notes, on the next such Special  Distribution  Date occurring not less
          than 15 days following such Cut-off Date,  (i) the  Responsible  Party
          shall pay to the Trustee for deposit in such Special Payments Account,
          in immediately  available  funds,  an amount equal to (A) the interest
          that would have accrued on such  Postponed  Notes  contemplated  to be
          purchased  with such unused  Escrowed Funds (other than Escrowed Funds
          referred  to in  the  immediately  preceding  paragraph)  but  not  so


<PAGE>

          purchased  at a rate equal to the  interest  rate  applicable  to such
          Certificates  from the  Issuance  Date  to,  but not  including,  such
          Special   Distribution  Date  minus  (B)  the  earnings  on  Specified
          Investments  (disregarding  any losses thereon) received (with respect
          to the portion of the  Escrowed  Funds  deposited  with respect to the
          Postponed Notes contemplated to be purchased with such unused Escrowed
          Funds  (other  than  Escrowed  Funds  referred  to in the  immediately
          preceding  paragraph)  but not so  purchased)  by the Trustee from and
          including  the  Issuance  Date to,  but not  including,  such  Special
          Distribution  Date and (ii) the  Trustee  shall  transfer  such unused
          Escrowed Funds and the amount paid by the  Responsible  Party pursuant
          to the  immediately  preceding  clause  (i) to such  Special  Payments
          Account for  distribution  as a Special Payment in accordance with the
          provisions hereof.

                                   ARTICLE III

                                    DEFAULT
                                    -------

          Section 3.01. PURCHASE RIGHTS OF  CERTIFICATEHOLDERS.  (a) At any time
after the occurrence and during the  continuation  of a Triggering  Event,  each
Class C Certificateholder  shall have the right (which shall not expire upon any
purchase of the Class A Certificates  pursuant to the Class B Trust  Agreement),
to purchase, for the purchase price and otherwise in accordance with and subject
to the provisions set forth in Section 6.01(b) of the Basic Agreement,  all, but
not less than all, of the Class A Certificates and the Class B Certificates upon
ten days' written notice to the Class A Trustee,  the Class B Trustee,  and each
other Class C  Certificateholder,  provided that (i) if prior to the end of such
ten-day  period any other Class C  Certificateholder  notifies  such  purchasing
Class C  Certificateholder  that such other Class C  Certificateholder  wants to
participate in such purchase, then such other Class C Certificateholder may join
with the purchasing Class C Certificateholder to purchase all, but not less than
all, of the Class A Certificates  and the Class B Certificates pro rata based on
the Fractional Undivided Interest in the 1997-3C Trust held by each such Class C
Certificateholder  and (ii) if prior to the end of such ten-day period any other
Class  C   Certificateholder   fails   to   notify   the   purchasing   Class  C
Certificateholder   of  such  other  Class  C   Certificateholder's   desire  to
participate in such a purchase,  then such other Class C Certificateholder shall
lose its right to purchase the Class A Certificates and the Class B Certificates
pursuant to this Section and Section 6.01(b) of the Basic Agreement.

               (b) As used in this Article III, the terms "Class A Certificate",
          "Class A  Trustee",  "Class B  Certificate",  "Class B  Trustee",  and
          "Class B Trust Agreement" shall have the respective  meanings assigned
          to such terms in the Intercreditor Agreement.

                                   ARTICLE IV

                                  THE TRUSTEE
                                  -----------

          Section 4.01. THE TRUSTEE.  The Trustee is hereby  directed to execute
and deliver the Intercreditor  Agreement on or prior to the Issuance Date in the


<PAGE>

form  delivered  to the  Trustee  by  the  Company.  The  Trustee  shall  not be
responsible  in any  manner  whatsoever  for or in respect  of the  validity  or
sufficiency of this Trust Supplement or the due execution hereof by the Company,
or for or in respect of the recitals and  statements  contained  herein,  all of
which recitals and statements are made solely by the Company.

          The Trustee, upon the execution and delivery of this Trust Supplement,
acknowledges its acceptance of all right, title and interest in and to the Trust
Property  with respect to the 1997-3C  Trust and declares that the Trustee holds
and will hold such right, title and interest for the benefit of all then present
and future  Class C  Certificateholders,  upon the trusts set forth in the Basic
Agreement and this Trust  Supplement.  By its  acceptance of each Series 1997-3C
Certificate   issued  to  it  under  the   Agreement,   each  initial   Class  C
Certificateholder  as grantor of the 1997-3C Trust thereby joins in the creation
and declaration of the 1997-3C Trust.

          Except as herein otherwise  provided,  no duties,  responsibilities or
liabilities are assumed,  or shall be construed to be assumed, by the Trustee by
reason of this Trust  Supplement other than as set forth in the Basic Agreement,
and this Trust  Supplement  is executed  and  accepted on behalf of the Trustee,
subject to all the terms and conditions set forth in the Basic  Agreement,  upon
the effectiveness thereof, as if the same were herein set forth at length.

          The Trustee  represents and warrants that the Intercreditor  Agreement
will  be  duly  executed  and  delivered  by  one of its  officers  who is  duly
authorized to execute and deliver such document on its behalf.

                                    ARTICLE V

                            MISCELLANEOUS PROVISIONS
                            ------------------------

          Section  5.01.  BASIC  AGREEMENT  MODIFIED  AND  RATIFIED.  The  Basic
Agreement is  incorporated  herein by reference  in its  entirety,  and shall be
deemed to be a part of this Trust Supplement as if set forth in full herein, and
is in all respects ratified and confirmed,  as supplemented and modified by this
Trust Supplement.

          Section 5.02.  GOVERNING  LAW. THIS TRUST  SUPPLEMENT  AND THE CLASS C
CERTIFICATES  SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE  WITH THE LAWS OF
THE STATE OF NEW YORK.

          Section 5.03. EXECUTION IN COUNTERPARTS.  This Trust Supplement may be
executed in any number of counterparts,  each of which shall be an original, but
such counterparts shall together constitute but one and the same instrument.


<PAGE>

          IN WITNESS WHEREOF, the Company and the Trustee have caused this Trust
Supplement  to be duly  executed by their  respective  officers  thereunto  duly
authorized, as of the day and year first written above.

                                       CONTINENTAL AIRLINES, INC.



                                        By:_____________________________________
                                           Name:
                                           Title:



                                       WILMINGTON TRUST COMPANY, as Trustee



                                        By:_____________________________________
                                           Name:
                                           Title:


<PAGE>

                                    EXHIBIT A
                                    ---------

                               Form of Certificate

          [Include on each Certificate that is a Global Certificate: Unless this
certificate is presented by an authorized representative of The Depository Trust
Company, a New York corporation ("DTC"), to Issuer or its agent for registration
of transfer,  exchange or payment,  and any certificate  issued is registered in
the name of Cede & Co. or in such other name as is  requested  by an  authorized
representative  of DTC (and any  payment  is made to Cede & Co. or to such other
entity as is requested by an authorized  representative  of DTC),  ANY TRANSFER,
PLEDGE  OR OTHER  USE  HEREOF  FOR  VALUE OR  OTHERWISE  BY OR TO ANY  PERSON IS
WRONGFUL  inasmuch as the registered  owner hereof,  Cede & Co., has an interest
herein.]<F1>

                 CONTINENTAL AIRLINES 1997-3C PASS THROUGH TRUST

                                  Pass Through
                           Certificate, Series 1997-3C

                        Issuance Date: September 25, 1997

                Final Expected Distribution Date: March 24, 2005

               evidencing a fractional undivided interest in a 1997-3C
               Trust, the property of which includes certain equipment
               notes each  secured by aircraft  leased to  Continental
               Airlines, Inc.

Certificate
No.________    $__________ Fractional Undivided Interest representing 0.0069358%
               of the Trust per $1,000 of face amount


          THIS CERTIFIES THAT ______________________, for value received, is the
registered owner of a $____________ (__ dollars)  Fractional  Undivided Interest
in the  Continental  Airlines Pass Through  Trust,  Series 1997-3C (the "TRUST")
created by Wilmington Trust Company,  as trustee (the "TRUSTEE"),  pursuant to a
Pass  Through  Trust  Agreement,  dated as of  September  25,  1997 (the  "BASIC
AGREEMENT"),  as supplemented by Trust Supplement No. 1997-3C thereto,  dated as
of September 25, 1997  (collectively,  the "AGREEMENT")  between the Trustee and
Continental  Airlines,  Inc.,  a  Delaware  corporation  (the  "COMPANY"  or the
"ISSUER"),  a summary  of certain of the  pertinent  provisions  of which is set
forth below. To the extent not otherwise  defined herein,  the capitalized terms
used  herein  have  the  meanings  assigned  to  them  in  the  Agreement.  This
Certificate  is  one  of  the  duly   authorized   Certificates   designated  as
"Continental Airlines Pass Through Certificates,  Series 1997-3C" (herein called
the  "CERTIFICATES").  This  Certificate  is issued  under and is subject to the
terms,  provisions and conditions of the Agreement.  By virtue of its acceptance
hereof, the  Certificateholder  of this Certificate  assents to and agrees to be


___________________

<F1>This  legend  to appear on Book-Entry Certificates to be deposited with  The
    Depository Trust Company.


<PAGE>

bound by the provisions of the Agreement and the  Intercreditor  Agreement.  The
property of the Trust  includes  certain  Equipment  Notes and all rights of the
Trust to receive  payments under the  Intercreditor  Agreement and the Liquidity
Facility (the "TRUST  PROPERTY").  Each issue of the Equipment  Notes is secured
by, among other things, a security interest in aircraft leased to the Company.

          The Certificates represent fractional undivided interests in the Trust
and the Trust Property,  and have no rights,  benefits or interest in respect of
any  other  separate  trust  established  pursuant  to the  terms  of the  Basic
Agreement for any other series of certificates issued pursuant thereto.

          Subject to and in  accordance  with the terms of the Agreement and the
Intercreditor Agreement, from funds then available to the Trustee, there will be
distributed on each March 24, June 24,  September 24 and December 24 (a "REGULAR
DISTRIBUTION  DATE"),  commencing  on December 24, 1997,  to the Person in whose
name this  Certificate  is  registered  at the close of business on the 15th day
preceding the Regular  Distribution  Date, an amount in respect of the Scheduled
Payments on the  Equipment  Notes due on such  Regular  Distribution  Date,  the
receipt of which has been confirmed by the Trustee,  equal to the product of the
percentage  interest in the Trust  evidenced by this  Certificate  and an amount
equal to the sum of such Scheduled  Payments.  Subject to and in accordance with
the terms of the Agreement and the  Intercreditor  Agreement,  in the event that
Special Payments on the Equipment Notes are received by the Trustee,  from funds
then  available to the Trustee,  there shall be  distributed  on the  applicable
Special  Distribution  Date,  to the  Person in whose name this  Certificate  is
registered  at the  close of  business  on the 15th day  preceding  the  Special
Distribution  Date,  an  amount  in  respect  of such  Special  Payments  on the
Equipment Notes,  the receipt of which has been confirmed by the Trustee,  equal
to the  product  of the  percentage  interest  in the  Trust  evidenced  by this
Certificate and an amount equal to the sum of such Special Payments so received.
If a Regular  Distribution  Date or Special  Distribution Date is not a Business
Day,  distribution shall be made on the immediately  following Business Day with
the same  force  and  effect  as if made on such  Regular  Distribution  Date or
Special  Distribution  Date and no interest shall accrue during the  intervening
period.  The Trustee  shall mail notice of each Special  Payment and the Special
Distribution Date therefor to the Certificateholder of this Certificate.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the Person entitled thereto,  without the presentation or surrender of
this  Certificate  or the making of any  notation  hereon.  Except as  otherwise
provided in the Agreement and  notwithstanding the above, the final distribution
on this  Certificate  will be made  after  notice  mailed by the  Trustee of the
pendency of such  distribution and only upon  presentation and surrender of this
Certificate at the office or agency of the Trustee specified in such notice.

          The  Certificates  do not  represent  a direct  obligation  of,  or an
obligation  guaranteed  by, or an interest in, the Company or the Trustee or any
affiliate thereof. The Certificates are limited in right of payment, all as more
specifically set forth on the face hereof and in the Agreement.  All payments or
distributions made to Certificateholders  under the Agreement shall be made only
from the Trust  Property  and only to the  extent  that the  Trustee  shall have


<PAGE>

sufficient  income or proceeds from the Trust  Property to make such payments in
accordance  with the  terms of the  Agreement.  Each  Certificateholder  of this
Certificate,  by its acceptance  hereof,  agrees that it will look solely to the
income  and  proceeds  from the  Trust  Property  to the  extent  available  for
distribution  to such  Certificateholder  as  provided  in the  Agreement.  This
Certificate does not purport to summarize the Agreement and reference is made to
the Agreement for information with respect to the interests,  rights,  benefits,
obligations,  proceeds, and duties evidenced hereby. A copy of the Agreement may
be examined during normal business hours at the principal office of the Trustee,
and  at  such  other  places,  if  any,   designated  by  the  Trustee,  by  any
Certificateholder upon request.

          The Agreement permits,  with certain exceptions therein provided,  the
amendment  thereof and the  modification  of the rights and  obligations  of the
Company and the rights of the Certificateholders under the Agreement at any time
by the  Company  and the  Trustee  with the  consent  of the  Certificateholders
holding Certificates  evidencing  Fractional Undivided Interests aggregating not
less  than a  majority  in  interest  in the  Trust.  Any  such  consent  by the
Certificateholder  of this  Certificate  shall be conclusive and binding on such
Certificateholder and upon all future Certificateholders of this Certificate and
of any  Certificate  issued upon the transfer hereof or in exchange hereof or in
lieu  hereof  whether  or not  notation  of  such  consent  is  made  upon  this
Certificate.  The  Agreement  also  permits the  amendment  thereof,  in certain
limited  circumstances,  without the consent of the Certificateholders of any of
the Certificates.

          As provided in the  Agreement and subject to certain  limitations  set
forth therein,  the transfer of this  Certificate is registrable in the Register
upon surrender of this  Certificate for  registration of transfer at the offices
or agencies  maintained by the Trustee in its capacity as  Registrar,  or by any
successor  Registrar  duly endorsed or  accompanied  by a written  instrument of
transfer in form satisfactory to the Trustee and the Registrar, duly executed by
the  Certificateholder   hereof  or  such   Certificateholder's   attorney  duly
authorized in writing,  and thereupon one or more new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest in the
Trust will be issued to the designated transferee or transferees.

          The Certificates are issuable only as registered  Certificates without
coupons in minimum  denominations of $1,000  Fractional  Undivided  Interest and
integral  multiples  thereof  except  that one  Certificate  may be  issued in a
different  denomination.  As  provided in the  Agreement  and subject to certain
limitations  therein  set  forth,  the  Certificates  are  exchangeable  for new
Certificates   of  authorized   denominations   evidencing  the  same  aggregate
Fractional   Undivided   Interest   in   the   Trust,   as   requested   by  the
Certificateholder surrendering the same.

          No service charge will be made for any such  registration  of transfer
or exchange,  but the Trustee shall require payment of a sum sufficient to cover
any tax or governmental charge payable in connection therewith.

          The  Trustee,  the  Registrar,  and any  agent of the  Trustee  or the
Registrar may treat the person in whose name this  Certificate  is registered as


<PAGE>

the owner hereof for all purposes,  and neither the Trustee, the Registrar,  nor
any such agent shall be affected by any notice to the contrary.

          The obligations and responsibilities  created by the Agreement and the
Trust   created   thereby   shall    terminate   upon   the    distribution   to
Certificateholders of all amounts required to be distributed to them pursuant to
the  Agreement  and the  disposition  of all property  held as part of the Trust
Property.

          Any Person  acquiring or  accepting  this  Certificate  or an interest
herein will, by such  acquisition or acceptance,  be deemed to have  represented
and warranted to and for the benefit of each Owner  Participant  and the Company
that  either:  (i) the assets of an employee  benefit plan subject to Title I of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or of
a plan subject to Section 4975 of the Internal  Revenue Code of 1986, as amended
(the  "CODE"),  have not been used to purchase this  Certificate  or an interest
herein or (ii) the purchase and holding of this  Certificate or interest  herein
are exempt from the prohibited  transaction  restrictions  of ERISA and the Code
pursuant  to one or more  prohibited  transaction  statutory  or  administration
exemptions.

          THIS  CERTIFICATE  AND THE AGREEMENT  HAVE EACH BEEN  DELIVERED IN THE
STATE OF NEW YORK AND  SHALL BE  CONSTRUED  IN  ACCORDANCE  WITH THE LAWS OF THE
STATE  OF  NEW  YORK  AND  THE   OBLIGATIONS,   RIGHTS  AND   REMEDIES   OF  THE
CERTIFICATEHOLDERS  HEREUNDER AND THE PARTIES  THEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

          Unless the certificate of  authentication  hereon has been executed by
the Trustee, by manual signature,  this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


<PAGE>

          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

                                        CONTINENTAL    AIRLINES   1997-3C   PASS
                                        THROUGH TRUST


                                        By: WILMINGTON TRUST COMPANY, as Trustee


                                        By:_____________________________________
                                           Title:_______________________________

Dated:____________________________



<PAGE>


              FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION


          This is one of the  Certificates  referred to in the  within-mentioned
Agreement.


                                        WILMINGTON TRUST COMPANY, as Trustee



                                        By:_____________________________________
                                           Name:
                                           Title:


<PAGE>



                                    EXHIBIT B
                                    ---------

                          DTC Letter of Representations



<PAGE>


                                    EXHIBIT C
                                    ---------

<TABLE>
<CAPTION>

                           Regular Distribution Dates
                                       and
                               Scheduled Payments


      DATE                                       SCHEDULED PAYMENTS OF PRINCIPAL
      ----                                       -------------------------------
<S>                                                         <C>
December 24, 1997................................           $  180,078
March 24, 1998...................................              380,004
June 24, 1998....................................              643,996
September 24, 1998...............................               39,800
December 24, 1998................................              144,819
March 24, 1999...................................              597,751
June 24, 1999....................................              469,114
September 24, 1999...............................               39,800
December 24, 1999................................               56,826
March 24, 2000...................................              622,060
June 24, 2000....................................              541,102
September 24, 2000...............................               43,373
December 24, 2000................................               56,826
March 24, 2001...................................              905,341
June 24, 2001....................................              728,584
September 24, 2001...............................              198,966
December 24, 2001................................              253,262
March 24, 2002...................................              973,326
June 24, 2002....................................              797,789
September 24, 2002...............................              612,707
December 24, 2002................................              364,716
March 24, 2003...................................            1,176,170
June 24, 2003....................................              892,114
September 24, 2003...............................              677,321
December 24, 2003................................              283,844
March 24, 2004...................................            1,066,658
June 24, 2004....................................              268,731
September 24, 2004...............................              751,110
December 24, 2004................................                    0
March 24, 2005...................................              651,812

</TABLE>



<PAGE>

                                    EXHIBIT D
                                    ---------

                             Related Note Documents

                      [Information to be added upon receipt
                             of HHR's Closing memo]








================================================================================




                             INTERCREDITOR AGREEMENT

                                   Dated as of
                               September 25, 1997

                                      among

                            WILMINGTON TRUST COMPANY,
                         not in its individual capacity
                         but solely as Trustee under the
             Continental Airlines Pass Through Trust 1997-Series 3A,
             Continental Airlines Pass Through Trust 1997-Series 3B

                                       and

             Continental Airlines Pass Through Trust 1997-Series 3C

                               ABN AMRO BANK N.V.,
                                 Chicago Branch,
                         as Class A Liquidity Provider,
                           Class B Liquidity Provider
                         and Class C Liquidity Provider,

                                       and

                            WILMINGTON TRUST COMPANY,
                      not in its individual capacity except
                        as expressly set forth herein but
                    solely as Subordination Agent and Trustee




================================================================================


<PAGE>


<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----
                                    ARTICLE I

                                   DEFINITIONS

<S>             <C>                                                          <C>
SECTION 1.1     Definitions....................................................2

                                   ARTICLE II

                        TRUST ACCOUNTS; CONTROLLING PARTY

SECTION 2.1     Agreement to Terms of Subordination; Payments from
                Monies Received Only..........................................20
SECTION 2.2     Trust Accounts................................................20
SECTION 2.3     Deposits to the Collection Account and Special Payments
                Account.......................................................22
SECTION 2.4     Distributions of Special Payments.............................22
SECTION 2.5     Designated Representatives....................................24
SECTION 2.6     Controlling Party.............................................25

                                   ARTICLE III

            RECEIPT, DISTRIBUTION AND APPLICATION OF AMOUNTS RECEIVED

SECTION 3.1     Written Notice of Distribution................................26
SECTION 3.2     Distribution of Amounts
 on Deposit in the Collection
                Account.......................................................28
SECTION 3.3     Distribution of Amounts on Deposit Following a Triggering
                Event.........................................................30
SECTION 3.4     Other Payments................................................32
SECTION 3.5     Payments to the Trustees and the Liquidity Providers..........32
SECTION 3.6     Liquidity Facilities..........................................32

                                   ARTICLE IV

                              EXERCISE OF REMEDIES

SECTION 4.1     Directions from the Controlling Party.........................38
SECTION 4.2     Remedies Cumulative...........................................40
SECTION 4.3     Discontinuance of Proceedings.................................40



<PAGE>


                               TABLE OF CONTENTS
                                  (Continued)
                                                                            PAGE
                                                                            ----

SECTION 4.4     Right of Certificateholders to Receive Payments Not to Be
                Impaired......................................................40
SECTION 4.5     Undertaking for Costs.........................................40

                                    ARTICLE V

         DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS OF TRUSTEES, ETC.

SECTION 5.1     Notice of Indenture Default or Triggering Event...............41
SECTION 5.2     Indemnification...............................................41
SECTION 5.3     No Duties Except as Specified in Intercreditor Agreement......41
SECTION 5.4     Notice from the Liquidity Providers and Trustees..............42

                                   ARTICLE VI

                             THE SUBORDINATION AGENT

SECTION 6.1     Authorization; Acceptance of Trusts and Duties................42
SECTION 6.2     Absence of Duties.............................................42
SECTION 6.3     No Representations or Warranties as to Documents..............42
SECTION 6.4     No Segregation of Monies; No Interest.........................43
SECTION 6.5     Reliance; Agents; Advice of Counsel...........................43
SECTION 6.6     Capacity in Which Acting......................................43
SECTION 6.7     Compensation..................................................43
SECTION 6.8     May Become Certificateholder..................................44
SECTION 6.9     Subordination Agent Required; Eligibility.....................44
SECTION 6.10    Money to Be Held in Trust.....................................44

                                   ARTICLE VII

                     INDEMNIFICATION OF SUBORDINATION AGENT

SECTION 7.1     Scope of Indemnification......................................44

                                  ARTICLE VIII

                          SUCCESSOR SUBORDINATION AGENT

SECTION 8.1     Replacement of Subordination Agent; Appointment of
                Successor.....................................................45



<PAGE>




                                TABLE OF CONTENTS
                                  (Continued)

                                                                            PAGE
                                                                            ----
                                   ARTICLE IX

                           SUPPLEMENTS AND AMENDMENTS

SECTION 9.1     Amendments, Waivers, Etc......................................46
SECTION 9.2     Subordination Agent Protected.................................47
SECTION 9.3     Effect of Supplemental Agreements.............................47
SECTION 9.4     Notice to Rating Agencies.....................................47

                                    ARTICLE X

                                  MISCELLANEOUS

SECTION 10.1    Termination of Intercreditor Agreement........................47
SECTION 10.2    Intercreditor Agreement for Benefit of Trustees,
                Liquidity Providers and Subordination Agent...................48
SECTION 10.3    Notices.......................................................48
SECTION 10.4    Severability..................................................49
SECTION 10.5    No Oral Modifications or Continuing Waivers...................49
SECTION 10.6    Successors and Assigns........................................49
SECTION 10.7    Headings......................................................49
SECTION 10.8    Counterpart Form..............................................49
SECTION 10.9    Subordination.................................................49
SECTION 10.10   Governing Law.................................................51
SECTION 10.11   Submission to Jurisdiction; Waiver of Jury Trial; Waiver
                of Immunity...................................................51

</TABLE>



<PAGE>

                             INTERCREDITOR AGREEMENT
                             -----------------------

          INTERCREDITOR   AGREEMENT  dated  as  of  September  25,  1997,  among
WILMINGTON TRUST COMPANY, a Delaware  corporation ("WTC"), not in its individual
capacity but solely as Trustee of each Trust (each as defined  below),  ABN AMRO
BANK N.V., a bank organized  under the laws of The  Netherlands,  acting through
its Chicago  Branch  ("ABN  AMRO"),  as Class A Liquidity  Provider,  as Class B
Liquidity  Provider  and as Class C Liquidity  Provider,  and  WILMINGTON  TRUST
COMPANY,  not in its individual  capacity  except as expressly set forth herein,
but solely as  Subordination  Agent and  trustee  hereunder  (in such  capacity,
together  with any  successor  appointed  pursuant to Article VIII  hereof,  the
"SUBORDINATION AGENT").

          WHEREAS,  all capitalized  terms used herein shall have the respective
meanings referred to in Article I hereof;

          WHEREAS,  pursuant  to  each  Indenture,  the  related  Owner  Trustee
proposes to issue on a  nonrecourse  basis three  series of  Equipment  Notes to
finance the current  indebtedness of such Owner Trustee  originally  incurred to
finance the purchase of the Aircraft referred to in such Indenture that has been
leased to Continental pursuant to the related Lease;

          WHEREAS, pursuant to the Financing Agreements, each Trust will acquire
Equipment Notes having an interest rate equal to the interest rate applicable to
the Certificates to be issued by such Trust;

          WHEREAS,  pursuant to each Trust Agreement,  the Trust created thereby
proposes  to issue a single  class  of  Certificates  (a  "CLASS")  bearing  the
interest  rate and having the final  distribution  date  described in such Trust
Agreement on the terms and subject to the conditions set forth therein;

          WHEREAS,  pursuant to the  Underwriting  Agreement,  the  Underwriters
propose to purchase the Certificates  issued by each Trust in the aggregate face
amount set forth  opposite  the name of such Trust on  Schedule I thereto on the
terms and subject to the conditions set forth therein;

          WHEREAS,  each Liquidity  Provider  proposes to enter into a revolving
credit agreement (each, a "LIQUIDITY Facility") with the Subordination Agent, as
agent for the  Trustee  of each  Trust,  respectively,  for the  benefit  of the
Certificateholders of such Trust; and

          WHEREAS,  it is a  condition  precedent  to  the  obligations  of  the
Underwriters under the Underwriting  Agreement that the Subordination Agent, the
Trustees and the Liquidity  Providers  agree to the terms of  subordination  set
forth in this  Agreement  in  respect  of each  Class of  Certificates,  and the
Subordination Agent, the Trustees and the Liquidity Providers,  by entering into
this Agreement,  hereby acknowledge and agree to such terms of subordination and
the other provisions of this Agreement.


<PAGE>

          NOW,  THEREFORE,  in  consideration  of the mutual  agreements  herein
contained,  and of other  good  and  valuable  consideration,  the  receipt  and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

          SECTION 1.1 DEFINITIONS. For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires:

          (1) the terms used herein that are  defined in this  Article  have the
     meanings  assigned to them in this Article,  and include the plural as well
     as the singular;

          (2)  all  references  in  this  Agreement  to  designated  "Articles",
     "Sections" and other subdivisions are to the designated Articles,  Sections
     and other subdivisions of this Agreement;

          (3) the words  "herein",  "hereof" and  "hereunder" and other words of
     similar import refer to this Agreement as a whole and not to any particular
     Article, Section or other subdivision; and

          (4) the term "including" shall mean "including without limitation".

          "ABN AMRO" has the  meaning  assigned  to such term in the  recital of
     parties to this Agreement.

          "ACCELERATION"  means,  with respect to the amounts payable in respect
     of the Equipment  Notes issued under any Indenture,  such amounts  becoming
     immediately  due and payable by declaration or otherwise.  This  definition
     shall also apply to related uses of the term,  including  "ACCELERATE"  and
     "ACCELERATED".

          "ADJUSTED   EXPECTED   DISTRIBUTIONS"   means,  with  respect  to  the
     Certificates of any Trust on any Current  Distribution Date, the sum of (x)
     the  amount of accrued  and unpaid  interest  on such  Certificates  (after
     giving effect to any Escrowed  Funds  Interest  Distribution  to be made on
     such Current  Distribution Date with respect to such Certificates) plus (y)
     the greater of:

               (A)  the  difference   between  (x)  the  Pool  Balance  of  such
          Certificates as of the immediately preceding Distribution Date (or, if
          the Current  Distribution  Date is the first  Distribution  Date,  the
          original  aggregate  face amount of the  Certificates  of such Trust),
          less (if applicable)  the aggregate  amount of Escrowed Funds for such
          Class of Certificates as of such  immediately  preceding  Distribution
          Date (or, if the Current  Distribution Date is the first  Distribution
          Date,  as  of  the  Closing  Date)   thereafter   distributed  to  the
          Certificateholders  of such Class  (instead  of being used to purchase


<PAGE>

          Postponed  Notes)  pursuant  to the  Trust  Agreement  for such  Class
          (excluding the interest component of any such  distribution),  and (y)
          the Pool Balance of such  Certificates as of the Current  Distribution
          Date   calculated   on  the  basis  that  (i)  the  principal  of  the
          Non-Performing  Equipment  Notes  held in such  Trust has been paid in
          full and such  payments have been  distributed  to the holders of such
          Certificates,  (ii) the principal of the  Performing  Equipment  Notes
          held in such Trust has been paid when due (but without  giving  effect
          to any unpaid  Acceleration  of Performing  Equipment  Notes) and such
          payments have been distributed to the holders of such Certificates and
          (iii) the principal of any Equipment Notes formerly held in such Trust
          that have been sold pursuant to the terms hereof has been paid in full
          and  such  payments  have  been  distributed  to the  holders  of such
          Certificates; and

               (B) the amount of the excess,  if any, of (i) the Pool Balance of
          such  Class  of   Certificates   as  of  the   immediately   preceding
          Distribution  Date (or if the Current  Distribution  Date is the first
          Distribution   Date,  the  original   aggregate  face  amount  of  the
          Certificates of such Trust), less (if applicable) the aggregate amount
          of  Escrowed  Funds  for  such  Class  of   Certificates  as  of  such
          immediately   preceding   Distribution   Date  (or,   if  the  Current
          Distribution  Date is the first  Distribution  Date, as of the Closing
          Date) thereafter  distributed to the  Certificateholders of such Class
          (instead of being used to purchase  Postponed  Notes)  pursuant to the
          Trust  Agreement for such Class  (excluding the interest  component of
          any such distribution),  over (ii) the Aggregate LTV Collateral Amount
          for such Class of Certificates for the Current Distribution Date;

     PROVIDED that, until the initial LTV Appraisals, clause (B) above shall not
     apply. For purposes of calculating  Adjusted  Expected  Distributions  with
     respect to the Certificates of any Trust, any premium paid on the Equipment
     Notes  held  in  such  Trust   that  has  not  been   distributed   to  the
     Certificateholders  of such  Trust  (other  than such  premium or a portion
     thereof  applied to the  payment of interest  on the  Certificates  of such
     Trust or the reduction of the Pool Balance of such Trust) shall be added to
     the amount of such Adjusted Expected Distributions.

          "ADVANCE",  with respect to any  Liquidity  Facility,  has the meaning
     assigned to such term in such Liquidity Facility.

          "AFFILIATE"  means,  with  respect  to any  Person,  any other  Person
     directly or indirectly  controlling,  controlled by or under common control
     with such Person. For the purposes of this definition,  "control" means the
     power,  directly or  indirectly,  to direct or cause the  direction  of the
     management  and policies of such Person  whether  through the  ownership of
     voting securities or by contract or otherwise;  and the terms "controlling"
     and "controlled" have meanings correlative to the foregoing.

          "AGGREGATE LTV COLLATERAL  AMOUNT" means for any Class of Certificates
     for any Distribution Date the sum of the applicable LTV Collateral  Amounts
     for each Aircraft minus the Pool Balance for each Class of Certificates, if


<PAGE>

     any,  senior to such Class,  after  giving  effect to any  distribution  of
     principal on such Distribution Date on such senior Class or Classes.

          "AIRCRAFT"  means,  with  respect to each  Indenture,  the  "Aircraft"
     referred to therein.

          "APPRAISED  CURRENT  MARKET VALUE" of any Aircraft  means the lower of
     the average or the median of the most recent three LTV  Appraisals  of such
     Aircraft.

          "APPRAISERS" means Aircraft Information Services, Inc., BK Associates,
     Inc. and Morten Beyer and Associates, Inc.

          "AVAILABLE  AMOUNT" means,  with respect to any Liquidity  Facility on
     any drawing date, subject to the proviso contained in the first sentence of
     Section  3.6(g)  hereof,  an amount equal to (a) the Stated  Amount of such
     Liquidity  Facility  at such time,  LESS (b) the  aggregate  amount of each
     Interest  Drawing  honored by the Liquidity  Provider  under such Liquidity
     Facility  on or  prior  to such  date  which  has not  been  reimbursed  or
     reinstated as of such date; PROVIDED that, following a Downgrade Drawing, a
     Non-Extension Drawing or a Final Drawing under such Liquidity Facility, the
     Available Amount of such Liquidity Facility shall be zero.

          "BUSINESS  DAY" means any day other than a Saturday or Sunday or a day
     on which  commercial  banks are required or authorized to close in Houston,
     Texas,  New York, New York, or, so long as any  Certificate is outstanding,
     the city and state in which any  Trustee,  the  Subordination  Agent or any
     Mortgagee  maintains its  Corporate  Trust Office or receives and disburses
     funds, and that, solely with respect to draws under any Liquidity Facility,
     also is a "Business Day" as defined in such Liquidity Facility.

          "CASH COLLATERAL  ACCOUNT" means the Class A Cash Collateral  Account,
     the Class B Cash Collateral Account or the Class C Cash Collateral Account,
     as applicable.

          "CERTIFICATE" means a Class A Certificate,  a Class B Certificate or a
     Class C Certificate, as applicable.

          "CERTIFICATEHOLDER" means any holder of one or more Certificates.

          "CLASS"  has the  meaning  assigned  to such  term in the  preliminary
     statements to this Agreement.

          "CLASS A CASH COLLATERAL ACCOUNT" means an Eligible Deposit Account in
     the name of the Subordination Agent maintained at an Eligible  Institution,
     which shall be the Subordination  Agent if it shall so qualify,  into which
     all amounts drawn under the Class A Liquidity  Facility pursuant to Section
     3.6(c), 3.6(d) or 3.6(i) shall be deposited.

          "CLASS A  CERTIFICATEHOLDER"  means, at any time, any holder of one or
     more Class A Certificates.


<PAGE>

          "CLASS A CERTIFICATES"  means the  certificates  issued by the Class A
     Trust,  substantially  in the  form  of  Exhibit  A to the  Class  A  Trust
     Agreement,   and  authenticated  by  the  Class  A  Trustee,   representing
     fractional  undivided  interests in the Class A Trust, and any certificates
     issued in exchange therefor or replacement thereof pursuant to the terms of
     the Class A Trust Agreement.

          "CLASS A LIQUIDITY  FACILITY" means,  initially,  the Revolving Credit
     Agreement dated as of the date hereof between the  Subordination  Agent, as
     agent and  trustee  for the  Class A  Trustee,  and the  Class A  Liquidity
     Provider,  and, from and after the  replacement of such Agreement  pursuant
     hereto, the Replacement  Liquidity Facility therefor,  if any, in each case
     as  amended,  supplemented  or  otherwise  modified  from  time  to time in
     accordance with its terms.

          "CLASS  A  LIQUIDITY  PROVIDER"  means  ABN  AMRO,  together  with any
     Replacement  Liquidity  Provider  that has issued a  Replacement  Liquidity
     Facility  to replace  the Class A  Liquidity  Facility  pursuant to Section
     3.6(e).

          "CLASS A TRUST" means Continental  Airlines Pass Through Trust, Series
     1997-3A created and administered pursuant to the Class A Trust Agreement.

          "CLASS A TRUST AGREEMENT" means the Pass Through Trust Agreement dated
     as of September 25, 1997, between  Continental and the Class A Trustee,  as
     supplemented  by the Trust  Supplement No. 1997-3A  thereto dated September
     25, 1997,  governing  the creation and  administration  of the  Continental
     Airlines Pass Through Trust Series  1997-3A and the issuance of the Class A
     Certificates,  as  the  same  may be  amended,  supplemented  or  otherwise
     modified from time to time in accordance with its terms.

          "CLASS A TRUSTEE" means WTC, not in its individual  capacity except as
     expressly set forth in the Class A Trust  Agreement,  but solely as trustee
     under the Class A Trust  Agreement,  together  with any  successor  trustee
     appointed pursuant thereto.

          "CLASS B CASH COLLATERAL ACCOUNT" means an Eligible Deposit Account in
     the name of the Subordination Agent maintained at an Eligible  Institution,
     which shall be the Subordination  Agent if it shall so qualify,  into which
     all amounts drawn under the Class B Liquidity  Facility pursuant to Section
     3.6(c), 3.6(d) or 3.6(i) shall be deposited.

          "CLASS B  CERTIFICATEHOLDER"  means, at any time, any holder of one or
     more Class B Certificates.

          "CLASS B CERTIFICATES"  means the  certificates  issued by the Class B
     Trust,  substantially  in the  form  of  Exhibit  A to the  Class  B  Trust
     Agreement,   and  authenticated  by  the  Class  B  Trustee,   representing
     fractional  undivided  interests in the Class B Trust, and any certificates
     issued in exchange therefor or replacement thereof pursuant to the terms of
     the Class B Trust Agreement.


<PAGE>

          "CLASS B LIQUIDITY  FACILITY" means,  initially,  the Revolving Credit
     Agreement dated as of the date hereof between the  Subordination  Agent, as
     agent and  trustee  for the  Class B  Trustee,  and the  Class B  Liquidity
     Provider,  and, from and after the  replacement of such Agreement  pursuant
     hereto, the Replacement  Liquidity Facility therefor,  if any, in each case
     as  amended,  supplemented  or  otherwise  modified  from  time  to time in
     accordance with its terms.

          "CLASS  B  LIQUIDITY  PROVIDER"  means  ABN  AMRO,  together  with any
     Replacement  Liquidity  Provider  that has issued a  Replacement  Liquidity
     Facility  to replace  the Class B  Liquidity  Facility  pursuant to Section
     3.6(e).

          "CLASS B TRUST" means Continental  Airlines Pass Through Trust, Series
     1997-3B created and administered pursuant to the Class B Trust Agreement.

          "CLASS B TRUST AGREEMENT" means the Pass Through Trust Agreement dated
     as of September 25, 1997, between  Continental and the Class B Trustee,  as
     supplemented  by the Trust  Supplement No. 1997-3B  thereto dated September
     25, 1997,  governing  the creation and  administration  of the  Continental
     Airlines Pass Through Trust Series  1997-3B and the issuance of the Class B
     Certificates,  as  the  same  may be  amended,  supplemented  or  otherwise
     modified from time to time in accordance with its terms.

          "CLASS B TRUSTEE" means WTC, not in its individual  capacity except as
     expressly set forth in the Class B Trust  Agreement,  but solely as trustee
     under the Class B Trust  Agreement,  together  with any  successor  trustee
     appointed pursuant thereto.

          "CLASS C CASH COLLATERAL ACCOUNT" means an Eligible Deposit Account in
     the  name  of  the  Subordination  Agent  and  maintained  at  an  Eligible
     Institution, which shall be the Subordination Agent if it shall so qualify,
     into which all amounts drawn under the Class C Liquidity  Facility pursuant
     to Section 3.6(c), 3.6(d) or 3.6(i) shall be deposited.

          "CLASS C  CERTIFICATEHOLDER"  means, at any time, any holder of one or
     more Class C Certificates.

          "CLASS C CERTIFICATES"  means the  certificates  issued by the Class C
     Trust,  substantially  in the  form  of  Exhibit  A to the  Class  C  Trust
     Agreement,   and  authenticated  by  the  Class  C  Trustee,   representing
     fractional  undivided  interests in the Class C Trust, and any certificates
     issued in exchange therefor or in replacement thereof pursuant to the terms
     of the Class C Trust Agreement.

          "CLASS C LIQUIDITY  FACILITY" means,  initially,  the Revolving Credit
     Agreement dated as of the date hereof between the  Subordination  Agent, as
     agent and  trustee  for the  Class C  Trustee,  and the  Class C  Liquidity
     Provider and, from and after the  replacement  of such  Agreement  pursuant
     hereto, the Replacement  Liquidity Facility therefor,  if any, in each case
     as  amended,  supplemented  or  otherwise  modified  from  time  to time in
     accordance with its terms.


<PAGE>

          "CLASS  C  LIQUIDITY  PROVIDER"  means  ABN  AMRO,  together  with any
     Replacement  Liquidity  Provider  that has issued a  Replacement  Liquidity
     Facility  to replace  the Class C  Liquidity  Facility  pursuant to Section
     3.6(e).

          "CLASS C TRUST" means Continental  Airlines Pass Through Trust, Series
     1997-3C created and administered pursuant to the Class C Trust Agreement.

          "CLASS C TRUST AGREEMENT" means the Pass Through Trust Agreement dated
     as of September 25, 1997, between  Continental and the Class C Trustee,  as
     supplemented  by the Trust  Supplement No. 1997-3C  thereto dated September
     25, 1997,  governing  the creation and  administration  of the  Continental
     Airlines Pass Through Trust, Series 1997-3C and the issuance of the Class C
     Certificates,  as  the  same  may be  amended,  supplemented  or  otherwise
     modified from time to time in accordance with its terms.

          "CLASS C TRUSTEE" means WTC, not in its individual  capacity except as
     expressly set forth in the Class C Trust  Agreement,  but solely as trustee
     under the Class C Trust  Agreement,  together  with any  successor  trustee
     appointed pursuant thereto.

          "CLOSING DATE" means September 25, 1997.

          "CODE" means the Internal  Revenue Code of 1986,  as amended from time
     to time, and the Treasury Regulations promulgated thereunder.

          "COLLECTION ACCOUNT" means the Eligible Deposit Account established by
     the  Subordination  Agent  pursuant to Section 2.2 which the  Subordination
     Agent shall make deposits in and  withdrawals  from in accordance with this
     Agreement.

          "CONTINENTAL"   means   Continental   Airlines,   Inc.,   a   Delaware
     corporation, and its successors and assigns.

          "CONTINENTAL  BANKRUPTCY  EVENT" means the occurrence and continuation
     of any of the following:

               (a) Continental shall consent to the appointment of or the taking
          of possession  by a receiver,  trustee or liquidator of itself or of a
          substantial  part of its  property,  or  Continental  shall  admit  in
          writing its inability to pay its debts  generally as they come due, or
          does not pay its debts  generally  as they  become due or shall make a
          general assignment for the benefit of creditors,  or Continental shall
          file a voluntary  petition in bankruptcy or a voluntary petition or an
          answer seeking  reorganization,  liquidation or other relief in a case
          under any bankruptcy  laws or other  insolvency  laws (as in effect at
          such  time) or an  answer  admitting  the  material  allegations  of a
          petition  filed against  Continental  in any such case, or Continental
          shall seek relief by voluntary petition,  answer or consent, under the
          provisions of any other  bankruptcy or other similar law providing for
          the reorganization or winding-up of corporations (as in effect at such
          time) or Continental shall seek an agreement,  composition,  extension


<PAGE>

          or  adjustment  with its creditors  under such laws, or  Continental's
          board of  directors  shall adopt a  resolution  authorizing  corporate
          action in furtherance of any of the foregoing; or

               (b) an order, judgment or decree shall be entered by any court of
          competent jurisdiction appointing, without the consent of Continental,
          a receiver, trustee or liquidator of Continental or of any substantial
          part of its  property,  or any  substantial  part of the  property  of
          Continental  shall be  sequestered,  or granting  any other  relief in
          respect of Continental as a debtor under any bankruptcy  laws or other
          insolvency  laws (as in  effect  at such  time),  and any such  order,
          judgment or decree of  appointment  or  sequestration  shall remain in
          force  undismissed,  unstayed  and  unvacated  for a period of 60 days
          after the date of entry thereof; or

               (c) a petition against Continental in a case under any bankruptcy
          laws or other insolvency laws (as in effect at such time) is filed and
          not withdrawn or dismissed within 60 days thereafter, or if, under the
          provisions of any law providing  for  reorganization  or winding-up of
          corporations  which may apply to  Continental,  any court of competent
          jurisdiction assumes  jurisdiction,  custody or control of Continental
          or of any  substantial  part of its  property  and such  jurisdiction,
          custody  or  control  remains in force  unrelinquished,  unstayed  and
          unterminated for a period of 60 days.

          "CONTINENTAL  PROVISIONS"  has the  meaning  assigned  to such term in
     Section 9.1(a).

          "CONTROLLING  PARTY" means the Person entitled to act as such pursuant
     to the terms of Section 2.6.

          "CORPORATE  TRUST  OFFICE"  means,  with respect to any  Trustee,  the
     Subordination Agent or any Mortgagee, the office of such Person in the city
     at which,  at any particular  time,  its corporate  trust business shall be
     principally administered.

          "CURRENT  DISTRIBUTION  DATE" means a Distribution Date specified as a
     reference date for calculating the Expected  Distributions  or the Adjusted
     Expected  Distributions with respect to the Certificates of any Trust as of
     such Distribution Date.

          "DESIGNATED    REPRESENTATIVES"    means   the   Subordination   Agent
     Representatives,  the Trustee  Representatives  and the LP  Representatives
     identified under Section 2.5.

          "DISTRIBUTION  DATE"  means a Regular  Distribution  Date or a Special
     Distribution Date.

          "DOLLARS" or "$" means United States dollars.

          "DOWNGRADE  DRAWING" has the meaning  assigned to such term in Section
     3.6(c).

          "DOWNGRADED FACILITY" has the meaning assigned to such term in Section
     3.6(c).


<PAGE>

          "DRAWING" means an Interest Drawing,  a Final Drawing, a Non-Extension
     Drawing or a Downgrade Drawing, as the case may be.

          "ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated  account with
     an  Eligible  Institution  or  (b) a  segregated  trust  account  with  the
     corporate trust department of a depository  institution organized under the
     laws of the United  States of  America or any one of the states  thereof or
     the District of Columbia  (or any U.S.  branch of a foreign  bank),  having
     corporate  trust  powers and acting as trustee for funds  deposited in such
     account,  so long as any of the securities of such  depository  institution
     has a long-term  unsecured  debt rating from each Rating Agency of at least
     A-3 or its equivalent. An Eligible Deposit Account may be maintained with a
     Liquidity  Provider  so long  as such  Liquidity  Provider  is an  Eligible
     Institution;  PROVIDED that such  Liquidity  Provider shall have waived all
     rights of  setoff  and  counterclaim  with  respect  to such  account;  and
     PROVIDED  FURTHER that no Cash Collateral  Account may be maintained with a
     Liquidity  Provider at any time Continental  holds any participation in the
     related  Liquidity  Facility  unless written  confirmation  shall have been
     received from each Rating Agency prior to such time to the effect that such
     maintenance of the Cash Collateral Account with the Liquidity Provider will
     not  result  in  a  withdrawal  or   downgrading  of  the  ratings  of  the
     Certificates.

          "ELIGIBLE INSTITUTION" means (a) the corporate trust department of the
     Subordination  Agent or any  Trustee,  as  applicable,  or (b) a depository
     institution organized under the laws of the United States of America or any
     one of the states  thereof or the District of Columbia (or any U.S.  branch
     of a foreign bank),  which has a long-term  unsecured debt rating from each
     Rating Agency of at least A-3 or its equivalent;  PROVIDED that a Liquidity
     Provider  shall  not  qualify  as  an  Eligible  Institution  at  any  time
     Continental  holds any  participation  in the  related  Liquidity  Facility
     unless  written  confirmation  shall have been  received  from each  Rating
     Agency to the effect that such Liquidity  Provider's  status as an Eligible
     Institution  will not result in a withdrawal or  downgrading of the ratings
     of the Certificates.

          "ELIGIBLE  INVESTMENTS"  means (a)  investments in obligations  of, or
     guaranteed by, the United States Government having maturities no later than
     90 days  following the date of such  investment,  (b)  investments  in open
     market commercial paper of any corporation  incorporated  under the laws of
     the  United  States of  America  or any  state  thereof  with a  short-term
     unsecured  debt rating  issued by Moody's and Standard & Poor's of at least
     A-1 and P-1,  respectively,  and  having  maturities  no later than 90 days
     following  the date of such  investment  or (c)  investments  in negotiable
     certificates of deposit, time deposits,  banker's  acceptances,  commercial
     paper or  other  direct  obligations  of,  or  obligations  guaranteed  by,
     commercial  banks  organized  under the laws of the United States or of any
     political  subdivision  thereof (or any U.S. branch of a foreign bank) with
     issuer ratings of at least B/C by Thomson  Bankwatch,  having maturities no
     later  than 90 days  following  the  date  of  such  investment;  PROVIDED,
     HOWEVER,  that (x) all Eligible Investments that are bank obligations shall
     be denominated in U.S.  dollars;  and (y) the aggregate  amount of Eligible
     Investments  at any one time  that are bank  obligations  issued by any one


<PAGE>


     bank shall not be in excess of 5% of such bank's capital surplus;  PROVIDED
     FURTHER that (1) any investment of the types  described in clauses (a), (b)
     and (c) above may be made  through a repurchase  agreement in  commercially
     reasonable form with a bank or other financial institution qualifying as an
     Eligible  Institution  so long as such  investment is held by a third party
     custodian  also  qualifying  as an Eligible  Institution,  and (2) all such
     investments  set forth in clause (a), (b) or (c) above mature no later than
     the Business Day immediately  preceding the next Regular Distribution Date;
     PROVIDED  FURTHER,  HOWEVER,  that in the case of any  Eligible  Investment
     issued by a  domestic  branch  of a  foreign  bank,  the  income  from such
     investment  shall be from sources  within the United States for purposes of
     the  Code.  Notwithstanding  the  foregoing,  no  investment  of the  types
     described  in clause (b) or (c) above  which is issued or  guaranteed  by a
     Liquidity  Provider or Continental or any of their  respective  Affiliates,
     and no  investment  in the  obligations  of  any  one  bank  in  excess  of
     $10,000,000,  shall be an Eligible Investment at any time Continental holds
     any  participation  in  the  related  Liquidity   Facility  unless  written
     confirmation  shall have been  received  from each  Rating  Agency that the
     making of such investment will not result in a withdrawal or downgrading of
     the ratings of the Certificates.

          "EQUIPMENT  NOTES" means,  at any time, the Series A Equipment  Notes,
     the  Series  B  Equipment   Notes  and  the  Series  C   Equipment   Notes,
     collectively,  and in each case,  any  Equipment  Notes  issued in exchange
     therefor or replacement thereof pursuant to the terms of the Indentures.

          "ESCROWED  FUNDS",  with respect to the Certificates of any Class, has
     the meaning assigned to such term in the Trust Agreement for such Class.

          "ESCROWED  FUNDS  INTEREST  DISTRIBUTION"  means,  with respect to the
     Certificates of any Class,  the interest  component of any  distribution to
     the  Certificateholders of such Class on account of Escrowed Funds for such
     Class of Certificates, earnings thereon or payments by Continental pursuant
     to the third  paragraph of Section  2.02(b) of the Trust Agreement for such
     Class of Certificates.

          "EXPECTED  DISTRIBUTIONS"  means,  with respect to the Certificates of
     any Trust on any  Current  Distribution  Date,  the sum of (x)  accrued and
     unpaid interest on such  Certificates  (after giving effect to any Escrowed
     Funds Interest  Distribution to be made on such Current  Distribution  Date
     with respect to such  Certificates) and (y) the difference  between (A) the
     Pool  Balance  of  such  Certificates  as  of  the  immediately   preceding
     Distribution  Date  (or,  if the  Current  Distribution  Date is the  first
     Distribution  Date, the original  aggregate face amount of the Certificates
     of such Trust), less (if applicable) the aggregate amount of Escrowed Funds
     for  such  Class  of   Certificates  as  of  such   immediately   preceding
     Distribution  Date  (or,  if the  Current  Distribution  Date is the  first
     Distribution  Date, as of the Closing Date)  thereafter  distributed to the
     Certificateholders  of such  Class  (instead  of  being  used  to  purchase
     Postponed  Notes) pursuant to the Trust Agreement for such Class (excluding
     the interest component of any such distribution),  and (B) the Pool Balance


<PAGE>


     of such Certificates as of the Current  Distribution Date calculated on the
     basis that (i) the principal of the Equipment  Notes held in such Trust has
     been  paid  when  due  (whether  at  stated  maturity  or upon  redemption,
     prepayment,  purchase or  Acceleration or otherwise) and such payments have
     been distributed to the holders of such Certificates and (ii) the principal
     of any  Equipment  Notes  formerly  held in such Trust which have been sold
     pursuant to the terms hereof have been paid in full and such  payments have
     been  distributed  to the  holders of such  Certificates.  For  purposes of
     calculating Expected  Distributions with respect to the Certificates of any
     Trust, any premium paid on the Equipment Notes held in such Trust which has
     not been  distributed to the  Certificateholders  of such Trust (other than
     such premium or a portion thereof applied to the payment of interest on the
     Certificates  of such Trust or the  reduction  of the Pool  Balance of such
     Trust) shall be added to the amount of such Expected Distributions.

          "EXPIRY DATE" with respect to any Liquidity  Facility,  shall have the
     meaning set forth in such Liquidity Facility.

          "FEE LETTER" means,  collectively,  the Fee Letter dated September 25,
     1997 between ABN AMRO, Rolls-Royce and the Subordination Agent with respect
     to the  Liquidity  Facilities  and any fee letter  entered into between the
     Subordination Agent and any Replacement Liquidity Provider.

          "FINAL  DISTRIBUTIONS"  means, with respect to the Certificates of any
     Trust on any Distribution  Date, the sum of (a) the aggregate amount of all
     accrued and unpaid interest on such  Certificates  and (b) the Pool Balance
     of such Certificates as of the immediately preceding Distribution Date. For
     purposes  of   calculating   Final   Distributions   with  respect  to  the
     Certificates of any Trust,  any premium paid on the Equipment Notes held in
     such Trust which has not been distributed to the Certificateholders of such
     Trust (other than such premium or a portion  thereof applied to the payment
     of interest on the  Certificates of such Trust or the reduction of the Pool
     Balance  of such  Trust)  shall  be  added  to the  amount  of  such  Final
     Distributions.

          "FINAL  DRAWING"  has the  meaning  assigned  to such term in  Section
     3.6(i).

          "FINAL LEGAL DISTRIBUTION DATE" means, (i) with respect to the Class A
     Certificates,  September  24,  2014,  (ii)  with  respect  to the  Class  B
     Certificates,  December  24,  2008,  and (iii) with  respect to the Class C
     Certificates, September 24, 2006.

          "FINANCING AGREEMENTS" means each of the Participation Agreements.

          "INDENTURE"  means  each of the Trust  Indentures  entered  into by an
     Owner Trustee and the Mortgagee, initially with respect to the aircraft set
     forth on  Schedule  I  hereto,  in each  case as the  same may be  amended,
     supplemented or otherwise modified from time to time in accordance with its
     terms.


<PAGE>

          "INDENTURE DEFAULT" means, with respect to any Indenture, any Event of
     Default (as such term is defined in such Indenture) thereunder.

          "INTEREST  DRAWING"  has the meaning  assigned to such term in Section
     3.6(a).

          "INVESTMENT EARNINGS" means investment earnings on funds on deposit in
     the  Trust  Accounts  net  of  losses  and   investment   expenses  of  the
     Subordination Agent in making such investments.

          "LEASE" means, with respect to each Indenture, the "Lease" referred to
     therein.

          "LENDING OFFICE" means, with respect to any Liquidity  Facility of the
     initial Liquidity  Provider,  the lending office of such Liquidity Provider
     presently  located at Chicago,  Illinois,  or such other lending  office as
     such  Liquidity  Provider  from time to time shall  notify  the  applicable
     Trustee as its lending office under any such Liquidity  Facility;  PROVIDED
     that such  Liquidity  Provider  shall not  change its  Lending  Office to a
     Lending  Office  outside the United States of America  except in accordance
     with Section 3.01, 3.02 or 3.03 of any such Liquidity Facility.

          "LIEN" means any mortgage, pledge, lien, charge, claim, disposition of
     title, encumbrance,  lease, sublease,  sub-sublease or security interest of
     any kind,  including,  without  limitation,  any thereof  arising under any
     conditional sales or other title retention agreement.

          "LIQUIDITY  EVENT OF DEFAULT"  means the  occurrence  of either (i) an
     Acceleration  of all the Equipment  Notes or (ii) a Continental  Bankruptcy
     Event.

          "LIQUIDITY  EXPENSES" means all Liquidity  Obligations  other than (i)
     the principal  amount of any Drawings  under the Liquidity  Facilities  and
     (ii) any interest accrued on any Liquidity Obligations.

          "LIQUIDITY  FACILITY"  means,  at any  time,  the  Class  A  Liquidity
     Facility, the Class B Liquidity Facility or the Class C Liquidity Facility,
     as applicable.

          "LIQUIDITY OBLIGATIONS" means all principal,  interest, fees and other
     amounts owing to the Liquidity  Providers  under the Liquidity  Facilities,
     Section 9.1 of the Participation Agreements or the Fee Letter.

          "LIQUIDITY  PROVIDER"  means,  at any  time,  the  Class  A  Liquidity
     Provider, the Class B Liquidity Provider or the Class C Liquidity Provider,
     as applicable.

          "LP INCUMBENCY  CERTIFICATE"  has the meaning assigned to such term in
     Section 2.5(b).

          "LP  REPRESENTATIVES" has the meaning assigned to such term in Section
     2.5(b).


<PAGE>

          "LTV APPRAISAL"  means a current fair market appraisal (which may be a
     "desktop"  appraisal)  performed by any  Appraiser or any other  nationally
     recognized appraiser on the basis of an arm's-length transaction between an
     informed and willing  purchaser  under no compulsion to buy and an informed
     and willing seller under no compulsion to sell and both having knowledge of
     all relevant facts.

          "LTV COLLATERAL  AMOUNT" of any Aircraft for any Class of Certificates
     on any  Distribution  Date  means the  lesser of (i) the LTV Ratio for such
     Class of Certificates  multiplied by the Appraised  Current Market Value of
     such Aircraft (or with respect to any such  Aircraft  which has suffered an
     Event of Loss under and as defined  in the Lease,  the amount of  insurance
     proceeds  paid to the  Mortgagee  under the  related  Indenture  in respect
     thereof to the extent then held by such Mortgagee (and/or on deposit in the
     Special Payments  Account) or payable to such Mortgagee in respect thereof)
     and (ii) the outstanding principal amount of the Equipment Notes secured by
     such  Aircraft  after  giving  effect  to any  principal  payments  of such
     Equipment Notes on or before such Distribution Date.

          "LTV RATIO" means for the Class A Certificates, 41.6%, for the Class B
     Certificates, 56.6% and for the Class C Certificates, 67.6%.

          "MAXIMUM  AVAILABLE   COMMITMENT",   with  respect  to  any  Liquidity
     Facility, has the meaning assigned to such term in such Liquidity Facility.

          "MINIMUM  SALE  PRICE"  means,  with  respect to any  Aircraft  or the
     Equipment Notes issued in respect of such Aircraft, at any time, the lesser
     of (a) 75% of the Appraised  Current  Market Value of such Aircraft and (b)
     the aggregate  outstanding  principal amount of such Equipment Notes,  plus
     accrued and unpaid interest thereon.

          "MOODY'S" means Moody's Investors Service, Inc.

          "MORTGAGEE"  means,  with  respect  to any  Indenture,  the  indenture
     trustee thereunder.

          "NON-CONTROLLING  PARTY" means,  at any time, any Trustee or Liquidity
     Provider which is not the Controlling Party at such time.

          "NON-EXTENDED  FACILITY"  has the  meaning  assigned  to such  term in
     Section 3.6(d).

          "NON-EXTENSION  DRAWING"  has the  meaning  assigned  to such  term in
     Section 3.6(d).

          "NON-PERFORMING   EQUIPMENT  NOTE"  means  an  Equipment  Note  issued
     pursuant to an Indenture that is not a Performing Equipment Note.

          "OFFICER'S  CERTIFICATE" of any Person means a certification signed by
     a Responsible Officer of such Person.


<PAGE>

          "OPERATIVE AGREEMENTS" means this Agreement, the Liquidity Facilities,
     the Indentures,  the Trust  Agreements,  the  Underwriting  Agreement,  the
     Leases, the Participation  Agreements,  the Fee Letter, the Equipment Notes
     and the  Certificates,  together with all exhibits and  schedules  included
     with any of the foregoing.

          "OUTSTANDING"   means,  when  used  with  respect  to  each  Class  of
     Certificates,  as of the date of  determination,  all  Certificates of such
     Class  theretofore  authenticated  and  delivered  under the related  Trust
     Agreement, except:

               (i)  Certificates  of such  Class  theretofore  cancelled  by the
          Registrar  (as defined in such Trust  Agreement)  or  delivered to the
          Trustee thereunder or such Registrar for cancellation;

               (ii)  Certificates  of such  Class  for  which  money in the full
          amount  required to make the final  distribution  with respect to such
          Certificates  pursuant to Section  11.01 of such Trust  Agreement  has
          been  theretofore  deposited with the related Trustee in trust for the
          holders of such Certificates as provided in Section 4.01 of such Trust
          Agreement    pending    distribution    of   such    money   to   such
          Certificateholders pursuant to such final distribution payment; and

               (iii)  Certificates  of such Class in exchange  for or in lieu of
          which  other   Certificates  have  been  authenticated  and  delivered
          pursuant to such Trust Agreement;

     PROVIDED, HOWEVER, that in determining whether the holders of the requisite
     Outstanding  amount of such  Certificates  have given any request,  demand,
     authorization,   direction,   notice,  consent  or  waiver  hereunder,  any
     Certificates  owned  by  Continental  or  any of its  Affiliates  shall  be
     disregarded and deemed not to be  Outstanding,  except that, in determining
     whether such Trustee  shall be protected in relying upon any such  request,
     demand,   authorization,   direction,   notice,  consent  or  waiver,  only
     Certificates   that  such  Trustee  knows  to  be  so  owned  shall  be  so
     disregarded. Certificates so owned that have been pledged in good faith may
     be regarded as Outstanding if the pledgee  establishes to the  satisfaction
     of the  applicable  Trustee the  pledgee's  right so to act with respect to
     such  Certificates  and that the pledgee is not  Continental  or any of its
     Affiliates.

          "OVERDUE  SCHEDULED  PAYMENT" means any Scheduled Payment which is not
     in fact  received  by the  Subordination  Agent  within five days after the
     Scheduled Payment Date relating thereto.

          "OWNER  TRUSTEE"  means,  with  respect  to any  Indenture,  the Owner
     Trustee (as defined  therein) not in its individual  capacity but solely as
     trustee  under  the  related  owner  trust  agreement,  together  with  any
     successor trustee appointed pursuant to such owner trust agreement.

          "PARTICIPATION  AGREEMENT" means, with respect to each Indenture,  the
     "Participation Agreement" referred to therein.



<PAGE>


          "PAYEE" has the meaning assigned to such term in Section 2.4(e).

          "PERFORMING EQUIPMENT NOTE" means an Equipment Note issued pursuant to
     an Indenture  with respect to which no payment  default has occurred and is
     continuing  (without giving effect to any  Acceleration);  PROVIDED that in
     the event of a bankruptcy  proceeding involving  Continental under Title 11
     of the United States Code (the "BANKRUPTCY  CODE"), (i) any payment default
     existing  during the  60-day  period  under  Section  1110(a)(1)(A)  of the
     Bankruptcy  Code (or such longer period as may apply under Section  1110(b)
     of the Bankruptcy Code) (the "SECTION 1110 PERIOD") shall not be taken into
     consideration,  unless  during the Section  1110 Period the trustee in such
     proceeding  or  Continental  refuses  to  assume  or agree to  perform  its
     obligations  under the Lease  related to such  Equipment  Note and (ii) any
     payment  default  occurring  after  the date of the order of relief in such
     proceeding shall not be taken into consideration if such payment default is
     cured under Section  1110(a)(1)(B)  of the Bankruptcy Code before the later
     of 30 days after the date of such default or the  expiration of the Section
     1110 Period.

          "PERFORMING NOTE DEFICIENCY"  means any time that less than 65% of the
     then  aggregate  outstanding  principal  amount of all Equipment  Notes are
     Performing Equipment Notes.

          "PERSON"  means  any  individual,   corporation,   partnership,  joint
     venture,  association,  limited  liability  company,  joint-stock  company,
     trust, trustee,  unincorporated organization or government or any agency or
     political subdivision thereof.

          "POOL BALANCE" means,  with respect to each Trust or the  Certificates
     issued by any Trust, as of any date, (i) the original aggregate face amount
     of the  Certificates  of such Trust LESS (ii) the  aggregate  amount of all
     payments  made in respect  of the  Certificates  of such  Trust  other than
     payments made in respect of interest or premium thereon or reimbursement of
     any costs and expenses in connection  therewith.  The Pool Balance for each
     Trust or the Certificates  issued by any Trust as of any Distribution  Date
     shall be computed after giving effect to the payment of principal,  if any,
     on the Equipment  Notes or other Trust  Property held in such Trust and the
     distribution thereof to be made on such date.

          "POSTPONED NOTES",  with respect to the Certificates of any Class, has
     the meaning assigned to such term in the Trust Agreement for such Class.

          "PROCEEDING" means any suit in equity, action at law or other judicial
     or administrative proceeding.

          "PTC EVENT OF DEFAULT"  means,  with respect to each Trust  Agreement,
     the failure to pay within 10 Business Days of the due date thereof: (i) the
     outstanding  Pool Balance of the applicable  Class of  Certificates  on the
     Final Legal  Distribution  Date for such Class or (ii) interest due on such
     Certificates on any Distribution Date (unless the Subordination Agent shall
     have made an Interest  Drawing,  or a withdrawal  from the Cash  Collateral


<PAGE>


     Account, with respect thereto in an aggregate amount sufficient to pay such
     interest  and shall have  distributed  such amount to the Trustee  entitled
     thereto).

          "RATING  AGENCIES" means,  collectively,  at any time, each nationally
     recognized  rating  agency  which  shall  have been  requested  to rate the
     Certificates  and which shall then be rating the  Certificates.  Initially,
     the Rating Agencies shall consist of Moody's and Standard & Poor's.

          "RATINGS  CONFIRMATION"  means, with respect to any action proposed to
     be taken, a written confirmation from each of the Rating Agencies that such
     action  would not result in (i) a reduction  of the rating for any Class of
     Certificates  below the then current rating for such Class of  Certificates
     or  (ii)  a  withdrawal  or  suspension  of the  rating  of  any  Class  of
     Certificates.

          "REGULAR  DISTRIBUTION  DATES" means each March 24, June 24, September
     24 and December 24,  commencing  on December 24, 1997;  PROVIDED,  HOWEVER,
     that, if any such day shall not be a Business Day, the related distribution
     shall  be made on the  next  succeeding  Business  Day  without  additional
     interest.

          "REPLACEMENT  LIQUIDITY  FACILITY" means, for any Liquidity  Facility,
     one or more irrevocable  revolving credit  agreements issued by one or more
     Persons in  substantially  the form of the initial  Liquidity  Facility for
     such  Trust,  including  reinstatement  provisions,  or in such  other form
     (which may include a letter of credit) as shall permit the Rating  Agencies
     to confirm  in writing  their  respective  ratings  then in effect for each
     Class of Certificates (before the downgrading of such ratings, if any, as a
     result  of the  downgrading  of the  replaced  Liquidity  Provider),  in an
     aggregate  face  amount  (together  with the face  amount of any  Liquidity
     Facility of the same Class which will continue to be outstanding  after the
     issuance of such Replacement  Liquidity Facility and the amount in the Cash
     Collateral  Account of such Class)  equal to the  Required  Amount for such
     Liquidity  Facility  and issued by one or more  Persons  having  short-term
     unsecured  debt ratings  issued by each Rating  Agency that are equal to or
     higher than the  Threshold  Rating.  Without  limitation of the form that a
     Replacement Liquidity Facility otherwise may have pursuant to the preceding
     sentence,  a Replacement  Liquidity  Facility for any Class of Certificates
     may have a stated  expiration  date  earlier  than 15 days  after the Final
     Maturity  Date of such Class of  Certificates  so long as such  Replacement
     Liquidity Facility provides for a Non-Extension  Drawing as contemplated by
     Section 3.6(d) hereof.

          "REPLACEMENT   LIQUIDITY   PROVIDER"  means  a  Person  who  issues  a
     Replacement Liquidity Facility.

          "REQUIRED AMOUNT" means, with respect to each Liquidity  Facility,  or
     the Cash  Collateral  Account,  for any Class,  for any day, the sum of the
     aggregate amount of interest, calculated at the rate per annum equal to the
     Stated Interest Rate for the related Class of  Certificates,  that would be
     payable on such Class of Certificates on each of the six successive Regular
     Distribution  Dates  immediately  following  such day or,  if such day is a
     Regular  Distribution  Date,  on such day and the  succeeding  five Regular


<PAGE>


     Distribution  Dates,  in each  case  calculated  on the  basis  of the Pool
     Balance of such Class of  Certificates  on such date and without  regard to
     expected future payments of principal on such Class of Certificates.

          "RESPONSIBLE  OFFICER"  means (i) with  respect  to the  Subordination
     Agent  and  each  of the  Trustees,  any  officer  in the  corporate  trust
     administration department of the Subordination Agent or such Trustee or any
     other officer customarily  performing  functions similar to those performed
     by the Persons who at the time shall be such officers,  respectively, or to
     whom any corporate trust matter is referred because of his knowledge of and
     familiarity  with a  particular  subject  and  (ii)  with  respect  to each
     Liquidity Provider, any authorized officer of such Liquidity Provider.

          "ROLLS-ROYCE" means Rolls-Royce plc, an English corporation.

          "SCHEDULED PAYMENT" means, with respect to any Equipment Note, (i) any
     payment of  principal  or  interest on such  Equipment  Note (other than an
     Overdue Scheduled Payment) due from the obligor thereon or (ii) any payment
     of interest on the  corresponding  Class of  Certificates  with funds drawn
     under any Liquidity  Facility,  which payment represents the installment of
     principal at the stated  maturity of such  installment of principal on such
     Equipment Note, the payment of regularly  scheduled interest accrued on the
     unpaid principal amount of such Equipment Note, or both;  PROVIDED that any
     payment of principal of,  premium,  if any, or interest  resulting from the
     redemption  or  purchase  of any  Equipment  Note  shall not  constitute  a
     Scheduled Payment.

          "SCHEDULED PAYMENT DATE" means, with respect to any Scheduled Payment,
     the date on which such Scheduled Payment is scheduled to be made.

          "SERIES A EQUIPMENT  NOTES" means the 7.160% Series A Equipment  Notes
     issued  pursuant  to  each  Indenture  by the  related  Owner  Trustee  and
     authenticated  by the Mortgagee  thereunder,  and any such Equipment  Notes
     issued in exchange therefor or replacement thereof pursuant to the terms of
     such Indenture.

          "SERIES B EQUIPMENT  NOTES" means the 7.140% Series B Equipment  Notes
     issued  pursuant  to  each  Indenture  by the  related  Owner  Trustee  and
     authenticated  by the Mortgagee  thereunder,  and any such Equipment  Notes
     issued in exchange therefor or replacement thereof pursuant to the terms of
     such Indenture.

          "SERIES C EQUIPMENT  NOTES" means the 7.121% Series C Equipment  Notes
     issued  pursuant  to  each  Indenture  by the  related  Owner  Trustee  and
     authenticated  by the Mortgagee  thereunder,  and any such Equipment  Notes
     issued in exchange therefor or replacement thereof pursuant to the terms of
     such Indenture.

          "SPECIAL  DISTRIBUTION  DATE"  means,  with  respect  to  any  Special
     Payment,  the date chosen by the  Subordination  Agent  pursuant to Section
     2.4(a) for the distribution of such Special Payment in accordance with this
     Agreement.



<PAGE>


          "SPECIAL  PAYMENT" means any payment (other than a Scheduled  Payment)
     in respect of, or any proceeds of, any  Equipment  Note or Trust  Indenture
     Estate (as defined in each Indenture).

          "SPECIAL  PAYMENTS ACCOUNT" means the Eligible Deposit Account created
     pursuant to Section 2.2 as a sub-account to the Collection Account.

          "STANDARD & POOR'S" means  Standard & Poor's Ratings Group, a division
     of The McGraw-Hill Companies Inc.

          "STATED  AMOUNT" with  respect to any  Liquidity  Facility,  means the
     Maximum  Commitment  (as  defined  in  such  Liquidity   Facility)  of  the
     applicable Liquidity Provider thereunder.

          "STATED  EXPIRATION  DATE" has the  meaning  assigned  to such term in
     Section 3.6(d).

          "STATED  INTEREST  RATE"  means  (i)  with  respect  to  the  Class  A
     Certificates,   7.160%  per  annum,  (ii)  with  respect  to  the  Class  B
     Certificates,  7.140%  per  annum,  and (iii)  with  respect to the Class C
     Certificates, 7.121% per annum.

          "SUBORDINATION   AGENT"  has  the  meaning   assigned  to  it  in  the
     preliminary statements to this Agreement.

          "SUBORDINATION AGENT INCUMBENCY  CERTIFICATE" has the meaning assigned
     to such term in Section 2.5(a).

          "SUBORDINATION AGENT REPRESENTATIVES" has the meaning assigned to such
     term in Section 2.5(a).

          "TAX"  and  "TAXES"  mean any and all  taxes,  fees,  levies,  duties,
     tariffs,  imposts, and other charges of any kind (together with any and all
     interest, penalties, loss, damage, liability, expense, additions to tax and
     additional  amounts or costs  incurred  or imposed  with  respect  thereto)
     imposed or  otherwise  assessed  by the United  States of America or by any
     state,  local or foreign  government (or any subdivision or agency thereof)
     or other taxing authority,  including,  without limitation:  taxes or other
     charges  on or with  respect  to  income,  franchises,  windfall  or  other
     profits,  gross receipts,  property,  sales,  use, capital stock,  payroll,
     employment,   social   security,   workers'   compensation,    unemployment
     compensation,  or net worth and similar charges;  taxes or other charges in
     the nature of excise,  withholding,  ad  valorem,  stamp,  transfer,  value
     added, taxes on goods and services, gains taxes, license,  registration and
     documentation fees, customs duties, tariffs, and similar charges.

          "TAX LETTER" means,  collectively,  the Fee Letter dated September 25,
     1997  between  ABN AMRO  and  Rolls-Royce  with  respect  to the  Liquidity
     Facilities  and  any  fee  letter  entered  into  between   Continental  or
     Rolls-Royce,  on the one hand, and any Replacement  Liquidity Provider,  on
     the other.


<PAGE>


          "TERMINATION  NOTICE" with respect to any  Liquidity  Facility has the
     meaning assigned to such term in such Liquidity Facility.

          "THRESHOLD  RATING" means the short-term  unsecured debt rating of P-1
     by Moody's and A-1 by Standard & Poor's.

          "TREASURY  REGULATIONS"  means  regulations,   including  proposed  or
     temporary  regulations,  promulgated  under the Code.  References herein to
     specific  provisions  of proposed or temporary  regulations  shall  include
     analogous  provisions  of final  Treasury  Regulations  or other  successor
     Treasury Regulations.

          "TRIGGERING  EVENT" means (x) the  occurrence of an Indenture  Default
     under  all of the  Indentures  resulting  in a PTC  Event of  Default  with
     respect to the most senior Class of Certificates then Outstanding,  (y) the
     Acceleration  of,  or a  failure  to  pay  at  final  maturity,  all of the
     outstanding  Equipment  Notes  or  (z)  the  occurrence  of  a  Continental
     Bankruptcy Event.

          "TRUST" means any of the Class A Trust, the Class B Trust or the Class
     C Trust.

          "TRUST  ACCOUNTS"  has the  meaning  assigned  to such term in Section
     2.2(a).

          "TRUST  AGREEMENT" means any of the Class A Trust  Agreement,  Class B
     Trust Agreement or Class C Trust Agreement.

          "TRUST PROPERTY", with respect to any Trust, has the meaning set forth
     in the Trust Agreement for such Trust.

          "TRUSTEE" means any of the Class A Trustee, the Class B Trustee or the
     Class C Trustee.

          "TRUSTEE INCUMBENCY CERTIFICATE" has the meaning assigned to such term
     in Section 2.5(a).

          "TRUSTEE  REPRESENTATIVES"  has the  meaning  assigned to such term in
     Section 2.5(a).

          "UNDERWRITERS"  means Morgan Stanley & Co.  Incorporated  and Citicorp
     Securities, Inc.

          "UNDERWRITING   AGREEMENT"  means  the  Underwriting  Agreement  dated
     September 12, 1997,  among the  Underwriters,  Rolls-Royce and Continental,
     relating to the purchase of the  Certificates by the  Underwriters,  as the
     same may be amended,  supplemented or otherwise  modified from time to time
     in accordance with its terms.

          "WRITTEN NOTICE" means, from the  Subordination  Agent, any Trustee or
     Liquidity  Provider,  a  written  instrument  executed  by  the  Designated


<PAGE>


     Representative of such Person. An invoice delivered by a Liquidity Provider
     pursuant to Section 3.1 in accordance with its normal invoicing  procedures
     shall constitute Written Notice under such Section.

          "WTC" has the meaning assigned to it in the preliminary  statements to
     this Agreement.


                                   ARTICLE II

                        TRUST ACCOUNTS; CONTROLLING PARTY

          SECTION 2.1 AGREEMENT TO TERMS OF SUBORDINATION;  PAYMENTS FROM MONIES
RECEIVED ONLY. (a) Each Trustee hereby  acknowledges  and agrees to the terms of
subordination  set  forth  in  this  Agreement  in  respect  of  each  Class  of
Certificates  and agrees to enforce  such  provisions  and cause all payments in
respect of the  Equipment  Notes and the  Liquidity  Facilities to be applied in
accordance  with the terms of this Agreement.  In addition,  each Trustee hereby
agrees  to cause  the  Equipment  Notes  purchased  by the  related  Trust to be
registered in the name of the Subordination  Agent or its nominee,  as agent and
trustee for such Trustee,  to be held in trust by the Subordination Agent solely
for the purpose of facilitating the enforcement of the  subordination  and other
provisions of this Agreement.

          (b) Except as  otherwise  expressly  provided  in the next  succeeding
sentence of this Section 2.1, all payments to be made by the Subordination Agent
hereunder  shall  be made  only  from  amounts  received  by it that  constitute
Scheduled  Payments,  Special  Payments  or  payments  under  Section 9.1 of the
Participation  Agreements,  and only to the extent that the Subordination  Agent
shall have received sufficient income or proceeds therefrom to enable it to make
such payments in accordance with the terms hereof.  Each of the Trustees and the
Subordination Agent hereby agrees and, as provided in each Trust Agreement, each
Certificateholder,  by its  acceptance  of a  Certificate,  and  each  Liquidity
Provider,  by entering into the Liquidity  Facility to which it is a party,  has
agreed to look solely to such amounts to the extent  available for  distribution
to it as  provided  in this  Agreement  and  that  none of the  Trustees,  Owner
Trustees,   Mortgagees,  Owner  Participants  nor  the  Subordination  Agent  is
personally  liable to any of them for any amounts payable or any liability under
this Agreement, any Trust Agreement, any Liquidity Facility or such Certificate,
except (in the case of the Subordination  Agent) as expressly provided herein or
(in the case of the Trustees) as expressly  provided in each Trust  Agreement or
(in the case of the Owner Trustees and the Mortgagees) as expressly  provided in
any Operative Agreement.

          SECTION 2.2 TRUST ACCOUNTS.  (a) Upon the execution of this Agreement,
the  Subordination  Agent  shall  establish  and  maintain  in its  name (i) the
Collection Account as an Eligible Deposit Account, bearing a designation clearly
indicating that the funds deposited therein are held in trust for the benefit of
the Trustees,  the  Certificateholders and the Liquidity Providers and (ii) as a
sub-account  in the  Collection  Account,  the  Special  Payments  Account as an
Eligible  Deposit  Account,  bearing a designation  clearly  indicating that the
funds deposited  therein are held in trust for the benefit of the Trustees,  the
Certificateholders  and the Liquidity  Providers.  The Subordination Agent shall
establish and maintain the Cash  Collateral  Accounts  pursuant to and under the
circumstances  set forth in Section 3.6(f) hereof.  Upon such  establishment and


<PAGE>


maintenance  under Section 3.6(f) hereof,  the Cash  Collateral  Accounts shall,
together with the Collection Account, constitute the "TRUST ACCOUNTS" hereunder.

          (b) Funds on  deposit  in the Trust  Accounts  shall be  invested  and
reinvested by the Subordination  Agent in Eligible  Investments  selected by the
Subordination  Agent  if such  investments  are  reasonably  available  and have
maturities  no later than the earlier of (i) 90 days  following the date of such
investment  and  (ii)  the  Business  Day  immediately   preceding  the  Regular
Distribution  Date or the date of the related  distribution  pursuant to Section
2.4 hereof,  as the case may be,  next  following  the date of such  investment;
PROVIDED,  HOWEVER,  that  following  the  making of a  Downgrade  Drawing  or a
Non-Extension  Drawing under any Liquidity  Facility,  the  Subordination  Agent
shall invest and reinvest such amounts in Eligible  Investments at the direction
of the Liquidity  Provider  with respect to such  Liquidity  Facility;  PROVIDED
FURTHER,  HOWEVER,  that upon the  occurrence and during the  continuation  of a
Triggering Event, the Subordination Agent shall invest and reinvest such amounts
in accordance with the written  instructions of the  Controlling  Party.  Unless
otherwise expressly provided in this Agreement  (including,  without limitation,
with respect to Investment Earnings on deposit in the Cash Collateral  Accounts,
Section  3.6(f)  hereof),  any  Investment  Earnings  shall be  deposited in the
Collection Account when received by the Subordination Agent and shall be applied
by the Subordination Agent in the same manner as the other amounts on deposit in
the Collection Account are to be applied and any losses shall be charged against
the principal amount  invested,  in each case net of the  Subordination  Agent's
reasonable fees and expenses in making such investments. The Subordination Agent
shall not be liable for any loss resulting from any investment,  reinvestment or
liquidation required to be made under this Agreement other than by reason of its
willful  misconduct  or gross  negligence.  Eligible  Investments  and any other
investment  required  to be made  hereunder  shall be held to  their  maturities
except that any such  investment may be sold (without regard to its maturity) by
the Subordination Agent without instructions  whenever such sale is necessary to
make a  distribution  required  under  this  Agreement.  Uninvested  funds  held
hereunder shall not earn or accrue interest.

          (c) The  Subordination  Agent  shall  possess  all  right,  title  and
interest in all funds on deposit from time to time in the Trust  Accounts and in
all proceeds thereof (including all income thereon, except as otherwise provided
herein with respect to Investment Earnings). The Trust Accounts shall be held in
trust by the  Subordination  Agent  under the sole  dominion  and control of the
Subordination Agent for the benefit of the Trustees,  the Certificateholders and
the Liquidity  Providers,  as the case may be. If, at any time, any of the Trust
Accounts ceases to be an Eligible Deposit Account, the Subordination Agent shall
within 10 Business Days (or such longer period,  not to exceed 30 calendar days,
to which each Rating  Agency may consent)  establish a new  Collection  Account,
Special Payments Account or Cash Collateral  Account,  as the case may be, as an
Eligible  Deposit  Account and shall transfer any cash and/or any investments to
such  new  Collection  Account,  Special  Payments  Account  or Cash  Collateral
Account,  as the case may be.  So long as WTC is an  Eligible  Institution,  the
Trust Accounts shall be maintained with it as Eligible Deposit Accounts.


<PAGE>


          SECTION 2.3 DEPOSITS TO THE  COLLECTION  ACCOUNT AND SPECIAL  PAYMENTS
ACCOUNT. (a) The Subordination Agent shall, upon receipt thereof, deposit in the
Collection Account all Scheduled Payments received by it.

          (b) The  Subordination  Agent  shall,  on each  date  when one or more
Special Payments are made to the Subordination  Agent as holder of the Equipment
Notes,  deposit in the Special  Payments  Account the  aggregate  amount of such
Special Payments.

          SECTION 2.4 DISTRIBUTIONS OF SPECIAL  PAYMENTS.  (a) NOTICE OF SPECIAL
PAYMENT.  Except as  provided  in  Section  2.4(e)  below,  upon  receipt by the
Subordination  Agent, as registered holder of the Equipment Notes, of any notice
of a Special Payment (or, in the absence of any such notice, upon receipt by the
Subordination  Agent  of a  Special  Payment),  the  Subordination  Agent  shall
promptly give notice  thereof to each Trustee and the Liquidity  Providers.  The
Subordination  Agent shall  promptly  calculate the amount of the  redemption or
purchase of Equipment Notes or the amount of any Overdue Scheduled  Payment,  as
the case may be, comprising such Special Payment under the applicable  Indenture
or Indentures  and shall  promptly send to each Trustee a Written Notice of such
amount and the amount  allocable to each Trust.  Such Written  Notice shall also
set the  distribution  date for such  Special  Payment (a "SPECIAL  DISTRIBUTION
DATE"),  which shall be the Business Day which immediately  follows the later to
occur of (x) the 15th day after the date of such Written  Notice or (y) the date
the Subordination Agent has received or expects to receive such Special Payment.
Amounts on deposit in the  Special  Payments  Account  shall be  distributed  in
accordance with Sections 2.4(b) and 2.4(c) hereof, as applicable.

          (b) (i)  REDEMPTIONS  AND PURCHASES OF EQUIPMENT  NOTES. So long as no
Triggering  Event  shall  have  occurred   (whether  or  not  continuing),   the
Subordination Agent shall make distributions  pursuant to this Section 2.4(b) of
amounts on deposit in the Special Payments Account on account of the redemption,
purchase (including, without limitation, a purchase resulting from a sale of the
Equipment  Notes  permitted by Article IV hereof) or  pre-payment  of all of the
Equipment Notes issued pursuant to an Indenture on the Special Distribution Date
for such Special Payment in the following order of priority:

     FIRST,  such  amount as shall be required to pay (A) all accrued and unpaid
     Liquidity  Expenses  then  in  arrears  PLUS  (B)  the  product  of (x) the
     aggregate  amount of all  accrued  and  unpaid  Liquidity  Expenses  not in
     arrears to such Special  Payment  Date  MULTIPLIED  BY (y) a fraction,  the
     numerator  of  which  is the  aggregate  outstanding  principal  amount  of
     Equipment  Notes  being  redeemed,  purchased  or prepaid  on such  Special
     Payment  Date and the  denominator  of which is the  aggregate  outstanding
     principal  amount  of all  Equipment  Notes,  shall be  distributed  to the
     Liquidity  Providers  PARI  PASSU on the basis of the  amount of  Liquidity
     Expenses owed to each Liquidity Provider;

     SECOND,  such amount as shall be required to pay (A) all accrued and unpaid
     interest then in arrears on all Liquidity  Obligations  (including interest
     accrued and unpaid on any Interest  Drawing or any Applied Provider Advance
     (as  defined in any  Liquidity  Facility))  PLUS (B) the product of (x) the


<PAGE>


     aggregate  amount of all  accrued  and  unpaid  interest  on all  Liquidity
     Obligations  not in  arrears  to such  Special  Payment  Date  (at the rate
     provided  in  the  applicable  Liquidity  Facility)  MULTIPLIED  BY  (y)  a
     fraction,  the  numerator of which is the aggregate  outstanding  principal
     amount of  Equipment  Notes being  redeemed,  purchased  or prepaid on such
     Special  Payment  Date  and  the  denominator  of  which  is the  aggregate
     outstanding  principal amount of all Equipment Notes,  shall be distributed
     to the  Liquidity  Providers  PARI PASSU on the basis of the amount of such
     Liquidity Obligations owed to each Liquidity Provider;

     THIRD, such amount as shall be required (A) if any Cash Collateral  Account
     had been previously funded as provided in Section 3.6(f), to fund such Cash
     Collateral  Account up to its  Required  Amount  shall be deposited in such
     Cash  Collateral  Account,  (B) if any  Liquidity  Facility  shall become a
     Downgraded Facility or a Non-Extended  Facility at a time when unreimbursed
     Interest  Drawings under such  Liquidity  Facility have reduced the Maximum
     Available  Commitment  thereunder  to  zero,  to  fund  the  relevant  Cash
     Collateral  Account up to such Cash  Collateral  Account's  Required Amount
     shall be  deposited  in such  Cash  Collateral  Account,  and (C) if,  with
     respect to any particular  Liquidity  Facility,  neither  subclause (A) nor
     subclause (B) of this clause  "third" are  applicable,  to pay or reimburse
     the Liquidity  Provider in respect of such Liquidity  Facility in an amount
     equal to the  amount  of any  unreimbursed  Interest  Drawings  under  such
     Liquidity  Facility shall be  distributed  to such Liquidity  Provider PARI
     PASSU  on  the  basis  of  the  amounts  of all  such  deficiencies  and/or
     unreimbursed Interest Drawings;

     FOURTH, if, with respect to any particular Liquidity Facility,  any amounts
     are to be  distributed  pursuant to either  subclause  (A) or (B) of clause
     "third" above,  then the Liquidity  Provider with respect to such Liquidity
     Facility shall be paid the excess of (x) the aggregate  outstanding  amount
     of  unreimbursed  Advances  (whether or not then due) under such  Liquidity
     Facility over (y) the Required Amount for the relevant Class, PARI PASSU on
     the basis of such amounts in respect of each Liquidity Provider;

     FIFTH,   such  amount  as  shall  be  required  to  pay  in  full  Expected
     Distributions  to the  holders  of  Class A  Certificates  on such  Special
     Distribution Date shall be distributed to the Class A Trustee;

     SIXTH,   such  amount  as  shall  be  required  to  pay  in  full  Expected
     Distributions  to the  holders  of  Class B  Certificates  on such  Special
     Distribution Date shall be distributed to the Class B Trustee;

     SEVENTH,  such  amount  as  shall  be  required  to  pay in  full  Expected
     Distributions  to the  holders  of  Class C  Certificates  on such  Special
     Distribution Date shall be distributed to the Class C Trustee; and

     EIGHTH,  the balance,  if any, of such Special Payment shall be transferred
     to the Collection  Account for  distribution in accordance with Section 3.2
     hereof.

For the  purposes of this Section  2.4(b)(i),  clause (x) of the  definition  of
"Expected  Distributions" shall be deemed to read as follows:  "(x) accrued, due


<PAGE>


and unpaid  interest on such  Certificates  (after giving effect to any Escrowed
Funds Interest  Distribution to be made on such Current  Distribution  Date with
respect to such Certificates)  together with (without  duplication)  accrued and
unpaid  interest  on a portion  of such  Certificates  equal to the  outstanding
principal  amount of  Equipment  Notes  being  redeemed,  purchased  or  prepaid
(immediately prior to such redemption, purchase or prepayment)".

               (ii) Upon the  occurrence of a Triggering  Event  (whether or not
     continuing),  the Subordination Agent shall make distributions  pursuant to
     this Section 2.4(b) of amounts on deposit in the Special  Payments  Account
     on account of the  redemption  or  purchase of all of the  Equipment  Notes
     issued pursuant to an Indenture on the Special  Distribution  Date for such
     Special Payment in accordance with Section 3.3 hereof.

          (c) OTHER  SPECIAL  PAYMENTS.  Except as provided in clause (e) below,
any amounts on deposit in the Special  Payments Account other than in respect of
amounts to be distributed pursuant to Section 2.4(b) shall be distributed on the
Special Distribution Date therefor in accordance with Article III hereof.

          (d) INVESTMENT OF AMOUNTS IN SPECIAL PAYMENTS ACCOUNT.  Any amounts on
deposit  in the  Special  Payments  Account  prior to the  distribution  thereof
pursuant to Section  2.4(b) or (c) shall be invested in accordance  with Section
2.2(b).  Investment  Earnings  on  such  investments  shall  be  distributed  in
accordance with Section 2.4(b) or (c), as the case may be.

          (e) CERTAIN PAYMENTS. The Subordination Agent will distribute promptly
upon receipt  thereof (i) any  indemnity  payment  received by it from the Owner
Participant,  the Owner  Trustee,  Continental  or Rolls-Royce in respect of any
Trustee or any  Liquidity  Provider  (collectively,  the  "PAYEES") and (ii) any
compensation (including,  without limitation,  any fees payable to any Liquidity
Provider under Section 2.03 of any Liquidity  Facility)  received by it from the
Owner  Participant,  the Owner Trustee,  Continental  or  Rolls-Royce  under any
Operative  Agreement or the Fee Letter in respect of any Payee,  directly to the
Payee entitled thereto.

          SECTION 2.5 DESIGNATED REPRESENTATIVES.  (a) With the delivery of this
Agreement,  the Subordination Agent shall furnish to each Liquidity Provider and
each Trustee,  and from time to time  thereafter  may furnish to each  Liquidity
Provider and each Trustee, at the Subordination Agent's discretion,  or upon any
Liquidity  Provider's or Trustee's request (which request shall not be made more
than one time in any 12-month  period),  a certificate (a  "SUBORDINATION  AGENT
INCUMBENCY  CERTIFICATE") of a Responsible  Officer of the  Subordination  Agent
certifying as to the incumbency  and specimen  signatures of the officers of the
Subordination  Agent and the  attorney-in-fact  and agents of the  Subordination
Agent (the  "SUBORDINATION  AGENT  REPRESENTATIVES")  authorized to give Written
Notices on behalf of the  Subordination  Agent  hereunder.  Until each Liquidity
Provider  and  Trustee  receives a  subsequent  Subordination  Agent  Incumbency
Certificate,  it  shall be  entitled  to rely on the  last  Subordination  Agent
Incumbency Certificate delivered to it hereunder.

          (b) With the delivery of this Agreement, each Trustee shall furnish to
the  Subordination  Agent,  and from time to time  thereafter may furnish to the



<PAGE>


Subordination  Agent, at such Trustee's  discretion,  or upon the  Subordination
Agent's  request  (which  request  shall  not be made  more than one time in any
12-month  period),  a  certificate  (a "TRUSTEE  INCUMBENCY  Certificate")  of a
Responsible Officer of such Trustee certifying as to the incumbency and specimen
signatures of the officers of such Trustee and the  attorney-in-fact  and agents
of such  Trustee  (the  "TRUSTEE  REPRESENTATIVES")  authorized  to give Written
Notices  on behalf of such  Trustee  hereunder.  Until the  Subordination  Agent
receives a subsequent  Trustee Incumbency  Certificate,  it shall be entitled to
rely on the last Trustee Incumbency Certificate delivered to it hereunder.

          (c) With the delivery of this Agreement, each Liquidity Provider shall
furnish to the Subordination Agent, and from time to time thereafter may furnish
to the Subordination Agent, at such Liquidity Provider's discretion, or upon the
Subordination  Agent's  request  (which  request shall not be made more than one
time in any 12-month period), a certificate (an "LP INCUMBENCY  CERTIFICATE") of
any  Responsible  Officer  of  such  Liquidity  Provider  certifying  as to  the
incumbency and specimen  signatures of any officer,  attorney-in-fact,  agent or
other   designated   representative   of  such   Liquidity   Provider  (the  "LP
REPRESENTATIVES"  and, together with the Subordination Agent Representatives and
the Trustee  Representatives,  the "DESIGNATED  REPRESENTATIVES")  authorized to
give Written Notices on behalf of such Liquidity Provider  hereunder.  Until the
Subordination Agent receives a subsequent LP Incumbency Certificate, it shall be
entitled  to  rely  on  the  last  LP  Incumbency  Certificate  delivered  to it
hereunder.

          SECTION 2.6  CONTROLLING  PARTY.  (a) The Trustees  and the  Liquidity
Providers  hereby agree that,  with respect to any  Indenture at any given time,
the Mortgagee  thereunder  will be directed (i) in taking,  or  refraining  from
taking,  any action under such Indenture or with respect to the Equipment  Notes
issued  thereunder,  so  long  as no  Indenture  Default  has  occurred  and  is
continuing thereunder,  by the holders of at least a majority of the outstanding
principal  amount of such  Equipment  Notes  (PROVIDED  that, for so long as the
Subordination  Agent  is the  registered  holder  of the  Equipment  Notes,  the
Subordination Agent shall act with respect to this clause (i) in accordance with
the  directions of the Trustees (in the case of each such Trustee,  with respect
to the Equipment Notes issued under such Indenture and held as Trust Property of
such Trust)  constituting,  in the  aggregate,  directions  with respect to such
principal amount of Equipment  Notes),  and (ii) after the occurrence and during
the continuance of an Indenture Default  thereunder (which has not been cured by
the applicable  Owner Trustee or the applicable  Owner  Participant  pursuant to
Section 4.03 of such  Indenture),  in taking,  or  refraining  from taking,  any
action under such Indenture or with respect to such Equipment  Notes,  including
exercising  remedies  thereunder  (including  Accelerating  the Equipment  Notes
issued  thereunder  or  foreclosing  the  Lien  on the  Aircraft  securing  such
Equipment Notes), by the Controlling Party.

          (b) The Person who shall be the  "CONTROLLING  PARTY" with  respect to
any  Indenture  shall be:  (x) the Class A  Trustee;  (y) upon  payment of Final
Distributions to the holders of Class A Certificates,  the Class B Trustee;  and
(z) upon payment of Final  Distributions to the holders of Class B Certificates,
the Class C  Trustee.  For  purposes  of giving  effect  to the  foregoing,  the
Trustees  (other  than  the  Controlling   Party)  irrevocably  agree  (and  the
Certificateholders  (other  than  the  Certificateholders   represented  by  the
Controlling  Party)  shall be deemed to agree by  virtue  of their  purchase  of
Certificates)  that the  Subordination  Agent, as record holder of the Equipment
Notes,  shall  exercise its voting rights in respect of the  Equipment  Notes as


<PAGE>


directed by the  Controlling  Party and any vote so  exercised  shall be binding
upon the Trustees and all Certificateholders.

The Subordination Agent shall give written notice to all of the other parties to
this Agreement  promptly upon a change in the identity of the Controlling Party.
Each of the parties  hereto  agrees that it shall not exercise any of the rights
of the  Controlling  Party  at  such  time as it is not  the  Controlling  Party
hereunder;  PROVIDED,  HOWEVER,  that nothing herein  contained shall prevent or
prohibit  any  Non-Controlling  Party from  exercising  such  rights as shall be
specifically granted to such Non-Controlling Party hereunder and under the other
Operative Agreements.

          (c)  Notwithstanding  the foregoing,  at any time after 18 months from
the  earlier  to occur of (i) the date on which  the  entire  Maximum  Available
Commitment  under any Liquidity  Facility  shall have been drawn (for any reason
other  than  a  Downgrade  Drawing  or  a  Non-Extension   Drawing)  and  remain
unreimbursed,  and (ii) the date on which all  Equipment  Notes  shall have been
Accelerated,  the  Liquidity  Provider  with the highest  outstanding  amount of
Liquidity  Obligations  shall have the right to elect,  by Written Notice to the
Subordination  Agent and each of the Trustees,  to become the Controlling  Party
hereunder  with respect to any Indenture at any time from and including the last
day of such 18-month period.

          (d) The  exercise  of  remedies  by the  Controlling  Party under this
Agreement shall be expressly limited by Section 4.1(a)(ii) hereof.

          (e) The Controlling Party shall not be entitled to require or obligate
any  Non-Controlling  Party to provide funds  necessary to exercise any right or
remedy hereunder.

                                   ARTICLE III

                    RECEIPT, DISTRIBUTION AND APPLICATION OF
                                AMOUNTS RECEIVED

          SECTION 3.1  WRITTEN  NOTICE OF  DISTRIBUTION.  (a) No later than 3:00
P.M. (New York City time) on the Business Day immediately preceding each Regular
Distribution  Date (or Special  Distribution Date for purposes of Section 2.4(b)
hereof,  as the case may be), each of the following Persons shall deliver to the
Subordination Agent a Written Notice setting forth the following  information as
at the close of business on such Business Day:

               (i) With respect to the Class A Certificates, the Class A Trustee
     shall separately set forth the amounts to be paid in accordance with clause
     "FIFTH" of Section 3.2 or 2.4(b), as the case may be, hereof;

               (ii)  With  respect  to the  Class B  Certificates,  the  Class B
     Trustee  shall  separately  set forth the amounts to be paid in  accordance
     with clause "SIXTH" of Section 3.2 or 2.4(b), as the case may be, hereof;


<PAGE>


               (iii)  With  respect  to the  Class C  Certificates,  the Class C
     Trustee  shall  separately  set forth the amounts to be paid in  accordance
     with clause "SEVENTH" of Section 3.2 or 2.4(b), as the case may be, hereof;

               (iv) With  respect  to each  Liquidity  Facility,  the  Liquidity
     Provider  thereunder  shall  separately set forth the amounts to be paid in
     accordance with clauses "FIRST",  "SECOND", "THIRD" and "FOURTH" of Section
     3.2 or 2.4(b), as the case may be, hereof; and

               (v) Each  Trustee  shall  set  forth  the  amounts  to be paid in
     accordance with clause "EIGHTH" of Section 3.2 hereof.

The notices  required under this Section 3.1(a) may be in the form of a schedule
or  similar  document  provided  to  the  Subordination  Agent  by  the  parties
referenced therein or by any one of them, which schedule or similar document may
state  that,  unless  there  has been a  prepayment  of the  Certificates,  such
schedule or similar document is to remain in effect until any substitute  notice
or amendment  shall be given to the  Subordination  Agent by the party providing
such notice.

          (b) Following the occurrence of a Triggering  Event, the Subordination
Agent shall request the following  information from the following  Persons,  and
each of the  following  Persons  shall,  upon the  request of the  Subordination
Agent,  deliver a Written  Notice to the  Subordination  Agent setting forth for
such Person the following information:

               (i) With respect to the Class A Certificates, the Class A Trustee
     shall  separately  set  forth the  amounts  to be paid in  accordance  with
     clauses   "FIRST"   (to   reimburse   payments   made   by  the   Class   A
     Certificateholders pursuant to subclause (iii) of clause "FIRST" of Section
     3.3 hereof) and "SEVENTH" of Section 3.3 hereof;

               (ii)  With  respect  to the  Class B  Certificates,  the  Class B
     Trustee  shall  separately  set forth the amounts to be paid in  accordance
     with  clauses   "FIRST"  (to  reimburse   payments  made  by  the  Class  B
     Certificateholders pursuant to subclause (iii) of clause "FIRST" of Section
     3.3 hereof) and "EIGHTH" of Section 3.3 hereof;

               (iii)  With  respect  to the  Class C  Certificates,  the Class C
     Trustee  shall  separately  set forth the amounts to be paid in  accordance
     with  clauses   "FIRST"  (to  reimburse   payments  made  by  the  Class  C
     Certificateholders pursuant to subclause (iii) of clause "FIRST" of Section
     3.3 hereof) and "NINTH" of Section 3.3 hereof;

               (iv) With  respect  to each  Liquidity  Facility,  the  Liquidity
     Provider thereunder shall separately set forth the amounts to be paid to it
     in accordance  with subclause (iii) of clause "FIRST" of Section 3.3 hereof
     and clauses "second",  "THIRD", "FOURTH" and "FIFTH" of Section 3.3 hereof;
     and

               (v) Each  Trustee  shall  set  forth  the  amounts  to be paid in
     accordance with clause "SIXTH" of Section 3.3 hereof.


<PAGE>


          (c) At such time as a  Trustee  or a  Liquidity  Provider  shall  have
received  all  amounts  owing  to  it  (and,  in  the  case  of a  Trustee,  the
Certificateholders  for which it is acting)  pursuant to Section 2.4, 3.2 or 3.3
hereof, as applicable,  and, in the case of a Liquidity Provider, its commitment
under the related  Liquidity  Facility  shall have  terminated or expired,  such
Person shall, by a Written Notice,  so inform the  Subordination  Agent and each
other party to this Agreement.

          (d) As provided in Section 6.5 hereof,  the Subordination  Agent shall
be fully  protected in relying on any of the  information set forth in a Written
Notice provided by any Trustee or any Liquidity  Provider pursuant to paragraphs
(a)  through  (c) above and shall  have no  independent  obligation  to  verify,
calculate or recalculate any amount set forth in any Written Notice delivered in
accordance with such paragraphs.

          (e) Any Written Notice delivered by a Trustee or a Liquidity Provider,
as applicable,  pursuant to Section  3.1(a),  3.1(b) or 3.1(c)  hereof,  if made
prior to 10:00  A.M.  (New  York  City  time)  shall  be  effective  on the date
delivered  (or if delivered  later shall be  effective  as of the next  Business
Day). Subject to the terms of this Agreement,  the Subordination  Agent shall as
promptly as practicable  comply with any such instructions;  PROVIDED,  HOWEVER,
that any transfer of funds pursuant to any instruction received after 10:00 A.M.
(New  York City  time) on any  Business  Day may be made on the next  succeeding
Business Day.

          (f) In the event the  Subordination  Agent shall not receive  from any
Person any information set forth in paragraph (a) or (b) above which is required
to enable the Subordination Agent to make a distribution to such Person pursuant
to Section  3.2 or 3.3  hereof,  the  Subordination  Agent  shall  request  such
information  and,  failing to receive any such  information,  the  Subordination
Agent shall not make such  distribution(s)  to such Person.  In such event,  the
Subordination Agent shall make distributions pursuant to clauses "FIRST" through
"NINTH" of Section 3.2 and clauses "FIRST" through "TENTH" of Section 3.3 to the
extent  it  shall  have  sufficient  information  to  enable  it  to  make  such
distributions, and shall continue to hold any funds remaining, after making such
distributions,  until  the  Subordination  Agent  shall  receive  all  necessary
information to enable it to distribute any funds so withheld.

          (g) On such  dates  (but  not more  frequently  than  monthly)  as any
Liquidity Provider or any Trustee shall request,  the Subordination  Agent shall
send to such party a written  statement  reflecting  all amounts on deposit with
the Subordination Agent pursuant to Section 3.1(f) hereof.

          SECTION  3.2  DISTRIBUTION  OF AMOUNTS  ON  DEPOSIT IN THE  COLLECTION
ACCOUNT.  Except as otherwise  provided in Sections  2.4,  3.1(f),  3.3, 3.4 and
3.6(b),  amounts on deposit in the  Collection  Account  (or, in the case of any
amount described in Section 2.4(c),  on deposit in the Special Payments Account)
shall be promptly distributed on each Regular Distribution Date (or, in the case
of any amount  described in Section  2.4(c),  on the Special  Distribution  Date
thereof)  in the  following  order  of  priority  and  in  accordance  with  the
information  provided to the  Subordination  Agent  pursuant  to Section  3.1(a)
hereof:


<PAGE>


     FIRST,  such  amount as shall be  required  to pay all  accrued  and unpaid
     Liquidity  Expenses owed to each Liquidity Provider shall be distributed to
     the Liquidity  Providers PARI PASSU on the basis of the amount of Liquidity
     Expenses owed to each Liquidity Provider;

     SECOND,  such  amount  as shall be  required  to pay in full the  aggregate
     amount  of  interest  accrued  on all  Liquidity  Obligations  (at the rate
     provided  in  the  applicable  Liquidity  Facility)  and  unpaid  shall  be
     distributed  to the  Liquidity  Providers  PARI  PASSU on the  basis of the
     amount of such Liquidity Obligations owed to each Liquidity Provider;

     THIRD, such amount as shall be required (A) if any Cash Collateral  Account
     had been previously funded as provided in Section 3.6(f), to fund such Cash
     Collateral  Account up to its  Required  Amount  shall be deposited in such
     Cash  Collateral  Account,  (B) if any  Liquidity  Facility  shall become a
     Downgraded Facility or a Non-Extended  Facility at a time when unreimbursed
     Interest  Drawings under such  Liquidity  Facility have reduced the Maximum
     Available  Commitment  thereunder  to  zero,  to  fund  the  relevant  Cash
     Collateral  Account up to such Cash  Collateral  Account's  Required Amount
     shall be  deposited  in such  Cash  Collateral  Account,  and (C) if,  with
     respect to any particular  Liquidity  Facility,  neither  subclause (A) nor
     subclause (B) of this clause  "third" are  applicable,  to pay or reimburse
     the Liquidity  Provider in respect of such Liquidity  Facility in an amount
     equal to the  amount  of all  Liquidity  Obligations  then due  under  such
     Liquidity  Facility (other than amounts payable  pursuant to clause "first"
     or "second" of this Section  3.2) shall be  distributed  to such  Liquidity
     Provider,  PARI PASSU on the basis of the amounts of all such  deficiencies
     and/or unreimbursed Liquidity Obligations;

     FOURTH, if, with respect to any particular Liquidity Facility,  any amounts
     are to be  distributed  pursuant to either  subclause  (A) or (B) of clause
     "third" above,  then the Liquidity  Provider with respect to such Liquidity
     Facility shall be paid the excess of (x) the aggregate  outstanding  amount
     of  unreimbursed  Advances  (whether or not then due) under such  Liquidity
     Facility over (y) the Required Amount for the relevant Class, PARI PASSU on
     the basis of such amounts in respect of each Liquidity Provider;

     FIFTH,   such  amount  as  shall  be  required  to  pay  in  full  Expected
     Distributions   to  the  holders  of  the  Class  A  Certificates  on  such
     Distribution Date shall be distributed to the Class A Trustee;

     SIXTH,   such  amount  as  shall  be  required  to  pay  in  full  Expected
     Distributions   to  the  holders  of  the  Class  B  Certificates  on  such
     Distribution Date shall be distributed to the Class B Trustee;

     SEVENTH,  such  amount  as  shall  be  required  to  pay in  full  Expected
     Distributions   to  the  holders  of  the  Class  C  Certificates  on  such
     Distribution Date shall be distributed to the Class C Trustee;

     EIGHTH,  such  amount  as shall be  required  to pay in full the  aggregate
     unpaid amount of fees and expenses payable as of such  Distribution Date to


<PAGE>


     the  Subordination  Agent and each  Trustee  pursuant  to the terms of this
     Agreement  and  the  Trust  Agreements,  as  the  case  may  be,  shall  be
     distributed to the Subordination Agent and such Trustee; and

     NINTH,  the  balance,  if any,  remaining  thereafter  shall be held in the
     Collection  Account for later  distribution in accordance with this Article
     III.

          SECTION 3.3 DISTRIBUTION OF AMOUNTS ON DEPOSIT  FOLLOWING A TRIGGERING
EVENT.  (a) Except as otherwise  provided in Sections  3.1(f) and 3.6(b) hereof,
upon the occurrence of a Triggering Event and at all times thereafter, all funds
in the  Collection  Account or the Special  Payments  Account  shall be promptly
distributed by the Subordination Agent in the following order of priority:

     FIRST,  such amount as shall be required to reimburse (i) the Subordination
     Agent for any out-of-pocket  costs and expenses actually incurred by it (to
     the  extent  not  previously  reimbursed)  in  the  protection  of,  or the
     realization  of the value of, the  Equipment  Notes or any Trust  Indenture
     Estate,  shall be applied by the  Subordination  Agent in  reimbursement of
     such costs and  expenses,  (ii) each  Trustee for any amounts of the nature
     described in clause (i) above actually  incurred by it under the applicable
     Trust  Agreement  (to the  extent  not  previously  reimbursed),  shall  be
     distributed   to  such  Trustee  and  (iii)  any   Liquidity   Provider  or
     Certificateholder  for payments,  if any,  made by it to the  Subordination
     Agent or any Trustee in respect of amounts  described  in clause (i) above,
     shall  be  distributed  to such  Liquidity  Provider  or to the  applicable
     Trustee for the account of such Certificateholder,  in each such case, PARI
     PASSU on the basis of all amounts  described  in clauses (i) through  (iii)
     above;

     SECOND,  such amount  remaining as shall be required to pay all accrued and
     unpaid Liquidity  Expenses shall be distributed to each Liquidity  Provider
     PARI PASSU on the basis of the amount of  Liquidity  Expenses  owed to each
     Liquidity Provider;

     THIRD, such amount remaining as shall be required to pay accrued and unpaid
     interest  on  the  Liquidity  Obligations  as  provided  in  the  Liquidity
     Facilities  shall be distributed  to each Liquidity  Provider PARI PASSU on
     the basis of the amount of such  accrued and unpaid  interest  owed to each
     Liquidity Provider;

     FOURTH,  such  amount  remaining  as  shall  be  required  (A) if any  Cash
     Collateral  Account  had been  previously  funded as  provided  in  Section
     3.6(f),  unless (i) a  Performing  Note  Deficiency  exists and a Liquidity
     Event of Default shall have occurred and be continuing  with respect to the
     relevant  Liquidity  Facility or (ii) a Final  Drawing  shall have occurred
     with  respect  to such  Liquidity  Facility,  to fund such Cash  Collateral
     Account up to its  Required  Amount (less the amount of any  repayments  of
     Interest  Drawings under such Liquidity  Facility  while  subclause  (A)(i)
     above is applicable)  shall be deposited in such Cash  Collateral  Account,
     (B) if any  Liquidity  Facility  shall  become a  Downgraded  Facility or a
     Non-Extended  Facility at a time when unreimbursed  Interest Drawings under
     such  Liquidity  Facility  have  reduced the Maximum  Available  Commitment
     thereunder to zero,  unless (i) a Performing Note  Deficiency  exists and a


<PAGE>


     Liquidity  Event of Default  shall have  occurred  and be  continuing  with
     respect to the relevant  Liquidity  Facility or (ii) a Final  Drawing shall
     have occurred with respect to such Liquidity Facility, to fund the relevant
     Cash  Collateral  Account  up to such Cash  Collateral  Account's  Required
     Amount (less the amount of any  repayments of Interest  Drawings under such
     Liquidity  Facility while  subclause  (B)(i) above is applicable)  shall be
     deposited in such Cash Collateral Account,  and (C) if, with respect to any
     particular  Liquidity Facility,  neither subclause (A) nor subclause (B) of
     this clause "fourth" are applicable,  to pay in full the outstanding amount
     of all Liquidity  Obligations then due under such Liquidity Facility (other
     than amounts payable pursuant to clause "SECOND" or "THIRD" of this Section
     3.3) shall be  distributed to such  Liquidity  Provider,  PARI PASSU on the
     basis of the amounts of all such deficiencies and/or unreimbursed Liquidity
     Obligations;

     FIFTH, if, with respect to any particular  Liquidity Facility,  any amounts
     are to be  distributed  pursuant to either  subclause  (A) or (B) of clause
     "FOURTH" above, then the Liquidity  Provider with respect to such Liquidity
     Facility shall be paid the excess of (x) the aggregate  outstanding  amount
     of  unreimbursed  Advances  (whether or not then due) under such  Liquidity
     Facility  over (y) the  Required  Amount for the  relevant  Class (less the
     amount of any repayments of Interest Drawings under such Liquidity Facility
     while  subclause  (A)(i) or (B)(i),  as the case may be, of clause "FOURTH"
     above is applicable), PARI PASSU on the basis of such amounts in respect of
     each Liquidity Provider;

     SIXTH,  such  amount  as  shall be  required  to  reimburse  or pay (i) the
     Subordination  Agent for any Tax (other than Taxes imposed on  compensation
     paid  hereunder),  expense,  fee,  charge or other loss  incurred by or any
     other amount  payable to the  Subordination  Agent in  connection  with the
     transactions contemplated hereby (to the extent not previously reimbursed),
     shall  be  applied  by the  Subordination  Agent in  reimbursement  of such
     amount,  (ii)  each  Trustee  for any Tax  (other  than  Taxes  imposed  on
     compensation  paid under the applicable  Trust  Agreement),  expense,  fee,
     charge,  loss or any  other  amount  payable  to  such  Trustee  under  the
     applicable  Trust  Agreements  (to the extent not  previously  reimbursed),
     shall be distributed to such Trustee and (iii) each  Certificateholder  for
     payments,  if any,  made by it pursuant to Section 5.2 hereof in respect of
     amounts  described  in  clause  (i)  above,  shall  be  distributed  to the
     applicable Trustee for the account of such Certificateholder,  in each such
     case,  PARI PASSU on the basis of all  amounts  described  in  clauses  (i)
     through (iii) above;

     SEVENTH, such amount remaining as shall be required to pay in full Adjusted
     Expected  Distributions on the Class A Certificates shall be distributed to
     the Class A Trustee;

     EIGHTH,  such amount remaining as shall be required to pay in full Adjusted
     Expected  Distributions on the Class B Certificates shall be distributed to
     the Class B Trustee;

     NINTH,  such amount  remaining as shall be required to pay in full Adjusted
     Expected  Distributions on the Class C Certificates shall be distributed to
     the Class C Trustee; and

     TENTH,  such amount  remaining shall be retained in the Collection  Account
     until the immediately  succeeding  Distribution  Date or, if all Classes of
     Certificates  shall  have been paid in full,  shall be  distributed  to the
     Owner Trustees.


<PAGE>


          SECTION  3.4  OTHER  PAYMENTS.   (a)  Any  payments  received  by  the
Subordination Agent for which no provision as to the application thereof is made
in this Agreement  shall be distributed  by the  Subordination  Agent (i) in the
order of  priority  specified  in  Section  3.3  hereof  and (ii) to the  extent
received or realized at any time after the Final Distributions for each Class of
Certificates have been made, in the manner provided in clause "FIRST" of Section
3.3 hereof.

          (b)  Except as  otherwise  provided  in  Section  3.3  hereof,  if the
Subordination  Agent receives any Scheduled  Payment after the Scheduled Payment
Date relating  thereto,  but prior to such payment becoming an Overdue Scheduled
Payment,  then the  Subordination  Agent shall deposit such Scheduled Payment in
the  Collection  Account  and  promptly  distribute  such  Scheduled  Payment in
accordance with the priority of  distributions  set forth in Section 3.2 hereof;
PROVIDED that,  for the purposes of this Section 3.4(b) only,  each reference in
clause  "EIGHTH" of Section 3.2 to  "Distribution  Date" shall be deemed to mean
the actual  date of payment of such  Scheduled  Payment  and each  reference  in
clause "FIFTH", "SIXTH" or "SEVENTH" of Section 3.2 to "Distribution Date" shall
be deemed to refer to such Scheduled Payment Date.

          SECTION 3.5 PAYMENTS TO THE TRUSTEES AND THE LIQUIDITY PROVIDERS.  Any
amounts  distributed  hereunder to any Liquidity  Provider shall be paid to such
Liquidity  Provider  by wire  transfer of funds to the  address  such  Liquidity
Provider shall provide to the Subordination Agent. The Subordination Agent shall
provide  a Written  Notice  of any such  transfer  to the  applicable  Liquidity
Provider,  as the  case  may  be,  at the  time of such  transfer.  Any  amounts
distributed  hereunder by the Subordination Agent to any Trustee which shall not
be the same institution as the Subordination Agent shall be paid to such Trustee
by wire  transfer  funds  at the  address  such  Trustee  shall  provide  to the
Subordination Agent.

          SECTION 3.6 LIQUIDITY  FACILITIES.  (a) INTEREST  DRAWINGS.  If on any
Distribution  Date, after giving effect to the subordination  provisions of this
Agreement,  the  Subordination  Agent  shall not have  sufficient  funds for the
payment of any amounts due and owing in respect of accrued interest on the Class
A  Certificates,  the Class B Certificates  or the Class C Certificates  (at the
Stated Interest Rate for such Class of Certificates),  then, prior to 12:00 noon
(New York City time) on the Business Day following such  Distribution  Date, the
Subordination  Agent shall request a drawing  (each such  drawing,  an "INTEREST
DRAWING")  under  each  Liquidity   Facility  with  respect  to  such  Class  of
Certificates in an amount equal to the lesser of (i) an amount sufficient to pay
the amount of such accrued  interest (at the Stated Interest Rate for such Class
of Certificates)  and (ii) the Available  Amount under such Liquidity  Facility,
and  shall  pay  such  amount  to the  Trustee  with  respect  to such  Class of
Certificates in payment of such accrued interest.

          (b) APPLICATION OF INTEREST DRAWINGS.  Notwithstanding anything to the
contrary  contained  in  this  Agreement,  (i)  all  payments  received  by  the
Subordination  Agent  in  respect  of an  Interest  Drawing  under  the  Class A
Liquidity Facility and all amounts withdrawn by the Subordination Agent from the
Class  A Cash  Collateral  Account,  and  payable  in each  case to the  Class A
Certificateholders,  shall be promptly distributed to the Class A Trustee,  (ii)
all  payments  received  by the  Subordination  Agent in respect of an  Interest
Drawing  under the Class B Liquidity  Facility and all amounts  withdrawn by the
Subordination  Agent from the Class B Cash  Collateral  Account,  and payable in
each case to the Class B  Certificateholders,  shall be promptly  distributed to


<PAGE>


the Class B Trustee and (iii) all payments received by the  Subordination  Agent
in respect of an Interest  Drawing under the Class C Liquidity  Facility and all
amounts  withdrawn by the  Subordination  Agent from the Class C Cash Collateral
Account,  and payable in each case to the Class C  Certificateholders,  shall be
promptly distributed to the Class C Trustee.

          (c) DOWNGRADE DRAWINGS.  If at any time the short-term  unsecured debt
rating of any  Liquidity  Provider  issued by either Rating Agency is lower than
the applicable  Threshold Rating,  within 10 days after receiving notice of such
downgrading  (but no later than the  expiration  date of the Liquidity  Facility
issued by the downgraded Liquidity Provider (the "DOWNGRADED  FACILITY")),  such
Liquidity  Provider  or  Continental  may arrange  for a  Replacement  Liquidity
Provider  to  issue  and  deliver  a  Replacement   Liquidity  Facility  to  the
Subordination  Agent.  If  a  Downgraded  Facility  has  not  been  replaced  in
accordance with the terms of this paragraph,  the Subordination  Agent shall, on
such 10th day (or if such 10th day is not a Business Day, on the next succeeding
Business Day) (or, if earlier, the expiration date of such Downgraded Facility),
request  a  drawing  in  accordance  with and to the  extent  permitted  by such
Downgraded  Facility (such drawing, a "DOWNGRADE  DRAWING") of all available and
undrawn amounts thereunder.  Amounts drawn pursuant to a Downgrade Drawing shall
be maintained and invested as provided in Section  3.6(f) hereof.  The Liquidity
Provider  may also  arrange for a  Replacement  Liquidity  Provider to issue and
deliver a  Replacement  Liquidity  Facility  at any time  after  such  Downgrade
Drawing so long as such Downgrade Drawing has not been reimbursed in full to the
Liquidity Provider.

          (d) NON-EXTENSION  DRAWINGS. If any Liquidity Facility with respect to
any  Class of  Certificates  is  scheduled  to  expire  on a date  (the  "STATED
EXPIRATION  DATE")  prior to the date that is 15 days  after the Final  Maturity
Date for such Class of  Certificates,  then, no earlier than the 60th day and no
later  than  the  40th  day  prior  to the  then  Stated  Expiration  Date,  the
Subordination Agent shall request that such Liquidity Provider extend the Stated
Expiration  Date for a period  of 364 days  after  the  Stated  Expiration  Date
(unless  the  obligations  of such  Liquidity  Provider  thereunder  are earlier
terminated in accordance with such Liquidity  Facility).  The Liquidity Provider
shall  advise the  Borrower,  no earlier  than 40 days and no later than 25 days
prior to such Stated Expiration Date, whether, in its sole discretion, it agrees
to so extend the Stated  Expiration  Date.  If, on or before such 25th day, such
Liquidity  Facility  shall not have been so extended  or replaced in  accordance
with  Section  3.6(e),  or if  the  Liquidity  Provider  fails  irrevocably  and
unconditionally  to advise the  Borrower  on or before the 25th day prior to the
Stated  Expiration Date then in effect that such Stated Expiration Date shall be
so extended,  the  Subordination  Agent  shall,  on such 25th day (or as soon as
possible  thereafter),  in  accordance  with and to the extent  permitted by the
terms of the expiring Liquidity Facility (a "NON-EXTENDED FACILITY"),  request a
drawing under such expiring  Liquidity  Facility (such drawing, a "NON-EXTENSION
DRAWING")  of all  available  and  undrawn  amounts  thereunder.  Amounts  drawn
pursuant  to a  Non-Extension  Drawing  shall  be  maintained  and  invested  in
accordance with Section 3.6(f) hereof.

          (e)  ISSUANCE  OF  REPLACEMENT  LIQUIDITY  FACILITY.  (i) At any time,
Continental  may,  at its  option,  with cause or without  cause,  arrange for a
Replacement  Liquidity  Facility to replace the Liquidity Facility for any Class


<PAGE>


of Certificates  (including any Replacement Liquidity Facility provided pursuant
to Section 3.6(e)(ii)  hereof);  PROVIDED,  HOWEVER,  that the initial Liquidity
Provider  shall not be  replaced  by  Continental  with  respect to any Class of
Certificates prior to the fifth anniversary of the Closing Date unless (A) there
shall  have  become  due to  the  initial  Liquidity  Provider,  or the  initial
Liquidity Provider shall have demanded,  amounts pursuant to Section 3.1, 3.2 or
3.3  of any  Liquidity  Facility,  or  pursuant  to  the  Tax  Letter,  and  the
replacement  of the initial  Liquidity  Provider  would reduce or eliminate  the
obligation  to pay such  amounts or  Continental  determines  in good faith that
there is a substantial  likelihood that the initial Liquidity Provider will have
the right to claim any such  amounts  (unless  the  initial  Liquidity  Provider
waives,  in  writing,  any  right  it may  have to claim  such  amounts),  which
determination  shall be set forth in a certificate  delivered by  Continental to
the initial  Liquidity  Provider setting forth the basis for such  determination
and  accompanied by an opinion of outside  counsel  selected by Continental  and
reasonably  acceptable  to the initial  Liquidity  Provider  verifying the legal
conclusions,  if any, of such certificate relating to such basis, PROVIDED that,
in the case of any likely claim for such  amounts  based upon any  proposed,  or
proposed   change  in,  law,  rule,   regulation,   interpretation,   directive,
requirement,  request or  administrative  practice,  such opinion may assume the
adoption or promulgation of such proposed  matter,  (B) it shall become unlawful
or  impossible  for the initial  Liquidity  Provider (or its Lending  Office) to
maintain  or fund  its  LIBOR  Advances  as  described  in  Section  3.10 of any
Liquidity  Facility,  (C) the  short-term  unsecured  debt rating of the initial
Liquidity Provider is downgraded by Standard & Poor's from A-1+ to A-1 and there
is a  resulting  downgrade  in the rating by any  Rating  Agency of any Class of
Certificates,  (D) a Downgrade  Drawing or a  Non-Extension  Drawing  shall have
occurred  under any  Liquidity  Facility or (E) the initial  Liquidity  Provider
shall have breached any of its payment (including, without limitation,  funding)
obligations under any Liquidity Facility. If such Replacement Liquidity Facility
is provided at any time after a Downgrade  Drawing or Non-Extension  Drawing has
been made, all funds on deposit in the relevant Cash Collateral  Account will be
returned to the Liquidity Provider being replaced.

          (ii) If any Liquidity  Provider  shall  determine not to extend any of
its Liquidity  Facilities in accordance with Section 3.6(d), then such Liquidity
Provider  may, at its option,  arrange for a Replacement  Liquidity  Facility to
replace such Liquidity Facility during the period no earlier than 40 days and no
later than 25 days prior to the then effective  Stated  Expiration  Date of such
Liquidity Facility.

          (iii) No Replacement  Liquidity  Facility arranged by Continental or a
Liquidity  Provider in accordance  with clause (i) or (ii) above,  respectively,
shall become  effective  and no such  Replacement  Liquidity  Facility  shall be
deemed a "Liquidity Facility" under the Operative Agreements (in each case other
than  insofar as  necessary  to permit  the  repayment  of  amounts  owed to the
replaced  Liquidity  Provider),  unless  and  until  (A) each of the  conditions
referred  to in  clause  (iv)  below  shall  have  been  satisfied,  (B) if such
Replacement  Liquidity  Facility shall  materially  adversely affect the rights,
remedies, interests or obligations of the Class A Certificateholders,  the Class
B  Certificateholders  or  the  Class  C  Certificateholders  under  any  of the
Operative Agreements,  the applicable Trustee shall have consented,  in writing,
to the execution and issuance of such Replacement  Liquidity Facility and (C) in
the case of a Replacement  Liquidity  Facility arranged by a Liquidity  Provider
under Section 3.6(e)(ii),  such Replacement  Liquidity Facility is acceptable to
Continental.


<PAGE>


          (iv) In  connection  with the issuance of each  Replacement  Liquidity
Facility,  the  Subordination  Agent  shall  (x) prior to the  issuance  of such
Replacement  Liquidity  Facility,  obtain written  confirmation from each Rating
Agency that such  Replacement  Liquidity  Facility will not cause a reduction of
the rating then in effect for any Class of  Certificates  by such Rating  Agency
(without regard to any downgrading of any rating of any Liquidity Provider being
replaced pursuant to Section 3.6(c) hereof),  (y) pay all Liquidity  Obligations
then owing to the replaced Liquidity Provider (which payment shall be made first
from available funds in the Cash Collateral Account as described in clause (vii)
of  Section  3.6(f)  hereof  and  thereafter  from any other  available  source,
including,  without  limitation,  a  drawing  under  the  Replacement  Liquidity
Facility)  and (z) cause the issuer of the  Replacement  Liquidity  Facility  to
deliver the Replacement  Liquidity Facility to the Subordination Agent, together
with a legal  opinion  opining that such  Replacement  Liquidity  Facility is an
enforceable obligation of such Replacement Liquidity Provider.

          (v) Upon satisfaction of the conditions set forth in clauses (iii) and
(iv)  of  this  Section  3.6(e),  (w)  the  replaced  Liquidity  Facility  shall
terminate,  (x) the Subordination Agent shall, if and to the extent so requested
by Continental or the Liquidity Provider being replaced, execute and deliver any
certificate  or other  instrument  required in order to  terminate  the replaced
Liquidity  Facility,  shall  surrender  the replaced  Liquidity  Facility to the
Liquidity  Provider being replaced and shall execute and deliver the Replacement
Liquidity Facility and any associated Fee Letter, (y) each of the parties hereto
shall enter into any  amendments to this  Agreement  necessary to give effect to
(1) the  replacement  of the applicable  Liquidity  Provider with the applicable
Replacement  Liquidity  Provider(s)  and (2) the  replacement  of the applicable
Liquidity  Facility with the applicable  Replacement  Liquidity Facility and (z)
each Replacement  Liquidity  Provider shall be deemed to be a Liquidity Provider
with the rights and obligations of a Liquidity  Provider hereunder and under the
other  Operative  Agreements and each  Replacement  Liquidity  Facility shall be
deemed to be a  Liquidity  Facility  hereunder  and  under  the other  Operative
Agreements.

          (f) CASH COLLATERAL ACCOUNTS;  WITHDRAWALS;  INVESTMENTS. In the event
the  Subordination  Agent  shall draw all  available  amounts  under the Class A
Liquidity  Facility,  the Class B  Liquidity  Facility  or the Class C Liquidity
Facility  pursuant to Section 3.6(c),  3.6(d) or 3.6(i) hereof,  or in the event
amounts are to be deposited in the Cash Collateral Account pursuant to subclause
(B) of clause  "THIRD" of Section  2.4(b),  subclause  (B) of clause  "THIRD" of
Section 3.2 or subclause (B) of clause "FOURTH" of Section 3.3, amounts so drawn
or to be deposited,  as the case may be, shall be deposited by the Subordination
Agent  in the  Class A Cash  Collateral  Account,  the  Class B Cash  Collateral
Account or the Class C Cash  Collateral  Account,  respectively.  All amounts on
deposit in each Cash  Collateral  Account  shall be invested and  reinvested  in
Eligible  Investments  in  accordance  with Section  2.2(b)  hereof.  Investment
Earnings on amounts on deposit in each of the Cash Collateral  Accounts shall be
deposited in the Collection  Account prior to giving effect to the distributions
below on each Distribution Date commencing on the first  Distribution Date after
any such deposit into such Collection  Account.  The  Subordination  Agent shall
deliver a written  statement to Continental  and the Liquidity  Provider one day
prior to each Distribution Date setting forth the aggregate amount of Investment
Earnings held in the Cash Collateral Accounts as of such date. In addition, from


<PAGE>


and after the date funds are so deposited,  the  Subordination  Agent shall make
withdrawals from such account as follows:

               (i) on each Distribution Date, the Subordination  Agent shall, to
     the  extent it shall not have  received  funds to pay  accrued  and  unpaid
     interest due and owing on the Class A Certificates  (at the Stated Interest
     Rate for the Class A Certificates) from any other source, withdraw from the
     Class A Cash Collateral  Account,  and pay to the Class A Trustee an amount
     equal to the lesser of (x) an amount  necessary  to pay  accrued and unpaid
     interest (at the Stated Interest Rate for the Class A Certificates) on such
     Class A  Certificates  and (y) the  amount on  deposit  in the Class A Cash
     Collateral Account;

               (ii) on each Distribution Date, the Subordination Agent shall, to
     the  extent it shall not have  received  funds to pay  accrued  and  unpaid
     interest due and owing on the Class B Certificates  (at the Stated Interest
     Rate for the Class B Certificates) from any other source, withdraw from the
     Class B Cash Collateral  Account,  and pay to the Class B Trustee an amount
     equal to the lesser of (x) an amount  necessary  to pay  accrued and unpaid
     interest (at the Stated Interest Rate for the Class B Certificates) on such
     Class B  Certificates  and (y) the  amount on  deposit  in the Class B Cash
     Collateral Account;

               (iii) on each Distribution  Date, the Subordination  Agent shall,
     to the extent it shall not have  received  funds to pay  accrued and unpaid
     interest due and owing on the Class C Certificates  (at the Stated Interest
     Rate for the Class C Certificates) from any other source, withdraw from the
     Class C Cash Collateral  Account,  and pay to the Class C Trustee an amount
     equal to the lesser of (x) an amount  necessary  to pay  accrued and unpaid
     interest (at the Stated Interest Rate for the Class C Certificates) on such
     Class C  Certificates  and (y) the  amount on  deposit  in the Class C Cash
     Collateral Account;

               (iv) on each date on which the Pool  Balance of the Class A Trust
     shall have been reduced by payments made to the Class A  Certificateholders
     pursuant to Section 2.4, 3.2 or 3.3 hereof,  the Subordination  Agent shall
     withdraw  from  the  Class A Cash  Collateral  Account  such  amount  as is
     necessary so that, after giving effect to the reduction of the Pool Balance
     on  such  date  (including  any  such  reduction  resulting  from  a  prior
     withdrawal of amounts on deposit in the Class A Cash Collateral  Account on
     such date),  the  Required  Amount  (with  respect to the Class A Liquidity
     Facility)  will be on deposit in the Class A Cash  Collateral  Account  and
     shall FIRST,  pay such amount to the Class A Liquidity  Provider  until the
     Liquidity  Obligations (with respect to the Class A Certificates)  owing to
     such Liquidity  Provider shall have been paid in full, and SECOND,  deposit
     any remaining amount in the Collection Account;

               (v) on each date on which the Pool  Balance  of the Class B Trust
     shall have been reduced by payments made to the Class B  Certificateholders
     pursuant to Section 2.4, 3.2 or 3.3 hereof,  the Subordination  Agent shall
     withdraw  from  the  Class B Cash  Collateral  Account  such  amount  as is
     necessary so that, after giving effect to the reduction of the Pool Balance
     on  such  date  (including  any  such  reduction  resulting  from  a  prior
     withdrawal of amounts on deposit in the Class B Cash Collateral  Account on


<PAGE>


     such date),  the  Required  Amount  (with  respect to the Class B Liquidity
     Facility)  will be on deposit in the Class B Cash  Collateral  Account  and
     shall FIRST,  pay such amount to the Class B Liquidity  Provider  until the
     Liquidity  Obligations (with respect to the Class B Certificates)  owing to
     such Liquidity  Provider shall have been paid in full, and SECOND,  deposit
     any remaining amount in the Collection Account;

               (vi) on each date on which the Pool  Balance of the Class C Trust
     shall have been reduced by payments made to the Class C  Certificateholders
     pursuant to Section 2.4, 3.2 or 3.3 hereof,  the Subordination  Agent shall
     withdraw  from  the  Class C Cash  Collateral  Account  such  amount  as is
     necessary so that, after giving effect to the reduction of the Pool Balance
     on  such  date  (including  any  such  reduction  resulting  from  a  prior
     withdrawal of amounts on deposit in the Class C Cash Collateral  Account on
     such date),  the  Required  Amount  (with  respect to the Class C Liquidity
     Facility)  will be on deposit in the Class C Cash  Collateral  Account  and
     shall FIRST,  pay such amount to the Class C Liquidity  Provider  until the
     Liquidity  Obligations (with respect to the Class C Certificates)  owing to
     such Liquidity  Provider shall have been paid in full, and SECOND,  deposit
     any remaining amount in the Collection Account;

               (vii)  if a  Replacement  Liquidity  Facility  for any  Class  of
     Certificates  shall be delivered to the  Subordination  Agent following the
     date on which funds have been  deposited into the Cash  Collateral  Account
     for such Class of Certificates,  the Subordination Agent shall withdraw all
     amounts  on  deposit  in such Cash  Collateral  Account  and shall pay such
     amounts to the replaced Liquidity Provider until all Liquidity  Obligations
     owed to such  Person  shall have been paid in full,  and shall  deposit any
     remaining amount in the Collection Account; and

               (viii) following the payment of Final  Distributions with respect
     to any Class of Certificates,  on the date on which the Subordination Agent
     shall  have been  notified  by the  Liquidity  Provider  for such  Class of
     Certificates that the Liquidity Obligations owed to such Liquidity Provider
     have been paid in full, the Subordination  Agent shall withdraw all amounts
     on  deposit  in the Cash  Collateral  Account  in  respect of such Class of
     Certificates and shall deposit such amount in the Collection Account.

          (g)  REINSTATEMENT.  With  respect to any Interest  Drawing  under the
Liquidity  Facility  for any Trust,  upon the  reimbursement  of the  applicable
Liquidity  Provider for all or any part of the amount of such Interest  Drawing,
together  with any  accrued  interest  thereon,  the  Available  Amount  of such
Liquidity  Facility shall be reinstated by an amount equal to the amount of such
Interest Drawing so reimbursed to the applicable  Liquidity  Provider but not to
exceed the Stated Amount for such Liquidity Facility;  PROVIDED,  HOWEVER,  that
such  Liquidity  Facility  shall not be so  reinstated in part or in full at any
time if (x) both a Performing  Note  Deficiency  exists and a Liquidity Event of
Default  shall have  occurred  and be  continuing  with  respect to the relevant
Liquidity  Facility or (y) a Final  Drawing  shall have  occurred with resect to
such  Liquidity  Facility.  In the event that,  with  respect to any  particular
Liquidity  Facility,  (i) funds are withdrawn from any Cash  Collateral  Account


<PAGE>


pursuant  to clause  (i),  (ii) or (iii) of Section  3.6(f)  hereof or (ii) such
Liquidity Facility shall become a Downgraded Facility or a Non-Extended Facility
at a time when unreimbursed Interest Drawings under such Liquidity Facility have
reduced the Maximum Available Commitment thereunder to zero, then funds received
by the Subordination  Agent at any time other than (x) any time when a Liquidity
Event of Default  shall have  occurred  and be  continuing  with respect to such
Liquidity Facility and a Performing Note Deficiency exists or (y) any time after
a Final  Drawing shall have  occurred  with respect to such  Liquidity  Facility
shall be deposited in such Cash Collateral Account as and to the extent provided
in clause  "THIRD" of Section  2.4(b),  clause  "THIRD" of Section 3.2 or clause
"FOURTH" of Section 3.3, as applicable,  and applied in accordance  with Section
3.6(f) hereof.

          (h)  REIMBURSEMENT.  The amount of each  drawing  under the  Liquidity
Facilities  shall be due and payable,  together  with interest  thereon,  on the
dates and at the rates, respectively, provided in the Liquidity Facilities.

          (i)  FINAL  DRAWING.  Upon  receipt  from a  Liquidity  Provider  of a
Termination  Notice with respect to any Liquidity  Facility,  the  Subordination
Agent shall,  not later than the date specified in such Termination  Notice,  in
accordance  with and to the  extent  permitted  by the  terms of such  Liquidity
Facility,  request a drawing under such Liquidity  Facility of all available and
undrawn  amounts  thereunder (a "FINAL  DRAWING").  Amounts drawn  pursuant to a
Final Drawing shall be maintained and invested in accordance with Section 3.6(f)
hereof.

          (j) REDUCTION OF STATED AMOUNT.  Promptly following each date on which
the Required  Amount of the Liquidity  Facility for a Class of  Certificates  is
reduced as a result of a distribution to the Certificateholders of such Class of
Certificates,  the  Subordination  Agent shall,  if any such Liquidity  Facility
provides for reductions of the Stated Amount of such  Liquidity  Facility and if
such reductions are not automatic, request the Liquidity Provider for such Class
of  Certificates to reduce such Stated Amount to an amount equal to the Required
Amount  with  respect  to  such   Liquidity   Facility  (as  calculated  by  the
Subordination  Agent after  giving  effect to such  payment).  Each such request
shall be made in  accordance  with the  provisions of the  applicable  Liquidity
Facility.

          (k) RELATION TO SUBORDINATION PROVISIONS.  Interest Drawings under the
Liquidity Facilities and withdrawals from the Cash Collateral Accounts,  in each
case,  in  respect  of  interest  on the  Certificates  of any  Class,  will  be
distributed  to the  Trustee  for such  Class of  Certificates,  notwithstanding
Sections 3.2, 3.3 and 3.6(h) hereof.

                                   ARTICLE IV

                              EXERCISE OF REMEDIES

          SECTION 4.1 DIRECTIONS FROM THE CONTROLLING  PARTY.  (a) (i) Following
the occurrence  and during the  continuation  of an Indenture  Default under any
Indenture,  the Controlling Party shall direct the Subordination Agent, which in
turn shall  direct  the  Mortgagee  under such  Indenture,  in the  exercise  of
remedies available to the holders of the Equipment Notes issued pursuant to such
Indenture, including, without limitation, the ability to vote all such Equipment
Notes in favor of  Accelerating  such  Equipment  Notes in  accordance  with the



<PAGE>



provisions  of such  Indenture.  Subject  to the Owner  Trustees'  and the Owner
Participants'  rights,  if any,  set forth in the  Indentures  to  purchase  the
Equipment Notes and the provisions of the next paragraph, if the Equipment Notes
issued  pursuant to any Indenture have been  Accelerated  following an Indenture
Default with respect thereto,  the Controlling Party may sell, assign,  contract
to sell or otherwise  dispose of and deliver all (but not less than all) of such
Equipment  Notes to any Person at public or private sale, at any location at the
option of the  Controlling  Party,  all upon such terms and conditions as it may
reasonably deem advisable in accordance with applicable law.

          (ii)  Subject  to the  Owner  Trustees'  and the  Owner  Participants'
rights, if any, set forth in the Indentures to purchase the Equipment Notes, and
notwithstanding  the foregoing,  so long as any Certificates remain Outstanding,
during the period  ending on the date which is nine months  after the earlier of
(x) the  Acceleration of the Equipment Notes issued pursuant to any Indenture or
(y) the  occurrence of a Continental  Bankruptcy  Event,  without the consent of
each  Trustee,  (A) no Aircraft  subject to the Lien of such  Indenture  or such
Equipment  Notes may be sold if the net  proceeds  from such sale  would be less
than the Minimum Sale Price for such Aircraft or such Equipment  Notes,  and (B)
the amount and payment dates of rentals  payable by Continental  under the Lease
for such Aircraft may not be adjusted,  if, as a result of such adjustment,  the
discounted  present  value of all  such  rentals  would be less  than 75% of the
discounted  present value of the rentals payable by Continental under such Lease
before  giving  effect to such  adjustment,  in each  case,  using the  weighted
average  interest rate of the Equipment  Notes issued pursuant to such Indenture
as the discount rate.

          (iii) At the request of the Controlling Party, the Subordination Agent
may from time to time during the continuance of an Indenture Default (and before
the occurrence of a Triggering  Event) commission LTV Appraisals with respect to
the Aircraft subject to such Indenture.

          (iv) After a Triggering  Event occurs and any Equipment Note becomes a
Non-Performing   Equipment  Note,  the  Subordination  Agent  shall  obtain  LTV
Appraisals  with  respect  to all of the  Aircraft  as soon as  practicable  and
additional  LTV  Appraisals on or prior to each  anniversary of the date of such
initial LTV  Appraisals;  PROVIDED  that, if the  Controlling  Party  reasonably
objects to the appraised value of the Aircraft shown in any such LTV Appraisals,
the  Controlling  Party  shall have the right to obtain or cause to be  obtained
substitute  LTV Appraisals  (including  any LTV  Appraisals  based upon physical
inspection of the Aircraft).

          (b) The Controlling Party shall take such actions as it may reasonably
deem most  effectual to complete the sale or other  disposition of such Aircraft
or Equipment Notes. In addition,  in lieu of any sale,  assignment,  contract to
sell or other disposition, the Controlling Party may maintain possession of such
Equipment  Notes and  continue  to apply  monies  received  in  respect  of such
Equipment Notes in accordance with Article III hereof.  In addition,  in lieu of
such sale, assignment, contract to sell or other disposition, or in lieu of such
maintenance of possession,  the Controlling  Party may, subject to the terms and
conditions of the related Indenture, instruct the Mortgagee under such Indenture
to foreclose on the Lien on the related Aircraft.


<PAGE>


          SECTION  4.2  REMEDIES  CUMULATIVE.  Each and every  right,  power and
remedy given to the Trustees, the Liquidity Providers,  the Controlling Party or
the  Subordination  Agent  specifically  or otherwise in this Agreement 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,  subject  always to the terms and  conditions
hereof,  be exercised from time to time and as often and in such order as may be
deemed expedient by any Trustee,  any Liquidity Provider,  the Controlling Party
or the Subordination Agent, as appropriate, 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 any  Trustee,  any  Liquidity  Provider,  the
Controlling  Party or the  Subordination  Agent 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  or to be an
acquiescence therein.

          SECTION 4.3  DISCONTINUANCE OF PROCEEDINGS.  In case any party to this
Agreement  (including  the  Controlling  Party  in  such  capacity)  shall  have
instituted  any  Proceeding  to enforce  any right,  power or remedy  under this
Agreement by foreclosure,  entry or otherwise,  and such  Proceeding  shall have
been  discontinued  or  abandoned  for any reason or shall have been  determined
adversely to the Person instituting such Proceeding, then and in every such case
each such party  shall,  subject to any  determination  in such  Proceeding,  be
restored to its former position and rights hereunder,  and all rights,  remedies
and  powers of such  party  shall  continue  as if no such  Proceeding  had been
instituted.

          SECTION 4.4 RIGHT OF  CERTIFICATEHOLDERS TO RECEIVE PAYMENTS NOT TO BE
IMPAIRED. Anything in this Agreement to the contrary notwithstanding but subject
to each Trust  Agreement,  the right of any  Certificateholder  or any Liquidity
Provider,  respectively,  to receive payments hereunder  (including  pursuant to
Section  2.4,  3.2 or 3.3  hereof)  when  due,  or to  institute  suit  for  the
enforcement  of any such payment on or after the applicable  Distribution  Date,
shall not be impaired or affected without the consent of such  Certificateholder
or such Liquidity Provider, respectively.

          SECTION  4.5   UNDERTAKING  FOR  COSTS.  In  any  Proceeding  for  the
enforcement  of any right or remedy under this  Agreement  or in any  Proceeding
against any Controlling Party or the Subordination Agent for any action taken or
omitted by it as Controlling Party or Subordination Agent, as the case may be, a
court in its discretion may require the filing by any party litigant in the suit
of an  undertaking to pay the costs of the suit, and the court in its discretion
may assess reasonable costs,  including reasonable attorneys' fees and expenses,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party  litigant.  The  provisions of
this Section do not apply to a suit  instituted by the  Subordination  Agent,  a
Liquidity  Provider or a Trustee or a suit by  Certificateholders  holding  more
than 10% of the original principal amount of any Class of Certificates.


<PAGE>


                                    ARTICLE V

                       DUTIES OF THE SUBORDINATION AGENT;
                          AGREEMENTS OF TRUSTEES, ETC.

          SECTION 5.1 NOTICE OF INDENTURE  DEFAULT OR TRIGGERING  EVENT.  (a) In
the event the Subordination  Agent shall have actual knowledge of the occurrence
of an Indenture Default or a Triggering  Event, as promptly as practicable,  and
in any event within 10 days after obtaining knowledge thereof, the Subordination
Agent shall  transmit by mail or courier to the Rating  Agencies,  the Liquidity
Providers and the Trustees notice of such Indenture Default or Triggering Event,
unless  such  Indenture  Default or  Triggering  Event  shall have been cured or
waived.  For all purposes of this Agreement,  in the absence of actual knowledge
on the part of a  Responsible  Officer,  the  Subordination  Agent  shall not be
deemed to have  knowledge of any Indenture  Default or  Triggering  Event unless
notified in writing by one or more Trustees,  one or more Liquidity Providers or
one or more Certificateholders.

          (b) OTHER  NOTICES.  The  Subordination  Agent  will  furnish  to each
Liquidity  Provider and Trustee,  promptly upon receipt  thereof,  duplicates or
copies of all  reports,  notices,  requests,  demands,  certificates,  financial
statements  and  other  instruments  furnished  to the  Subordination  Agent  as
registered  holder  of the  Equipment  Notes or  otherwise  in its  capacity  as
Subordination  Agent to the  extent  the same  shall  not  have  been  otherwise
directly  distributed  to such  Liquidity  Provider or Trustee,  as  applicable,
pursuant to the express provision of any other Operative Agreement.

          SECTION  5.2  INDEMNIFICATION.  The  Subordination  Agent shall not be
required to take any action or refrain from taking any action under  Section 5.1
(other  than the  first  sentence  thereof)  or  Article  IV hereof  unless  the
Subordination Agent shall have been indemnified (to the extent and in the manner
reasonably satisfactory to the Subordination Agent) against any liability,  cost
or expense  (including  counsel  fees and  expenses)  which may be  incurred  in
connection therewith.  The Subordination Agent shall not be under any obligation
to take any action under this Agreement and nothing  contained in this Agreement
shall  require  the  Subordination  Agent to  expend  or risk  its own  funds or
otherwise incur any financial  liability in the performance of any of its duties
hereunder  or in the  exercise  of any of its  rights or powers if it shall have
reasonable  grounds  for  believing  that  repayment  of such funds or  adequate
indemnity  against such risk or liability is not  reasonably  assured to it. The
Subordination  Agent shall not be required to take any action under  Section 5.1
(other  than the first  sentence  thereof)  or Article IV hereof,  nor shall any
other   provision  of  this  Agreement  be  deemed  to  impose  a  duty  on  the
Subordination  Agent to take any action, if the  Subordination  Agent shall have
been  advised by counsel  that such action is contrary to the terms hereof or is
otherwise contrary to law.

          SECTION 5.3 NO DUTIES EXCEPT AS SPECIFIED IN INTERCREDITOR  AGREEMENT.
The Subordination Agent shall not have any duty or obligation to take or refrain
from taking any action under, or in connection  with, this Agreement,  except as
expressly  provided  by the terms of this  Agreement;  and no implied  duties or
obligations shall be read into this Agreement  against the Subordination  Agent.
The Subordination  Agent agrees that it will, in its individual  capacity and at


<PAGE>


its own cost and expense  (but  without any right of indemnity in respect of any
such cost or expense under Section 7.1 hereof), promptly take such action as may
be necessary  to duly  discharge  all Liens on any of the Trust  Accounts or any
monies  deposited  therein which result from claims against it in its individual
capacity  not  related  to  its  activities  hereunder  or any  other  Operative
Agreement.

          SECTION 5.4 NOTICE FROM THE LIQUIDITY  PROVIDERS AND TRUSTEES.  If any
Liquidity Provider or Trustee has notice of an Indenture Default or a Triggering
Event,  such Person shall  promptly give notice  thereof to all other  Liquidity
Providers and Trustees and to the Subordination Agent,  PROVIDED,  HOWEVER, that
no such Person shall have any liability  hereunder as a result of its failure to
deliver any such notice.

                                   ARTICLE VI

                             THE SUBORDINATION AGENT

          SECTION 6.1  AUTHORIZATION;  ACCEPTANCE OF TRUSTS AND DUTIES.  Each of
the Class A Trustee,  Class B Trustee and Class C Trustee hereby  designates and
appoints the Subordination  Agent as the agent and trustee of such Trustee under
the applicable  Liquidity  Facility and authorizes  the  Subordination  Agent to
enter into the  applicable  Liquidity  Facility  as agent and  trustee  for such
Trustee.  Each of the Liquidity Providers and the Trustees hereby designates and
appoints  the  Subordination   Agent  as  the  Subordination  Agent  under  this
Agreement.  WTC hereby accepts the duties hereby created and applicable to it as
the  Subordination  Agent and agrees to perform the same but only upon the terms
of this  Agreement and agrees to receive and disburse all monies  received by it
in  accordance  with the terms  hereof.  The  Subordination  Agent  shall not be
answerable  or  accountable  under  any  circumstances,  except  (a) for its own
willful  misconduct or gross negligence (or ordinary  negligence in the handling
of funds),  (b) as provided in Section 2.2 hereof and (c) for  liabilities  that
may result from the material inaccuracy of any representation or warranty of the
Subordination Agent made in its individual capacity in any Operative  Agreement.
The  Subordination  Agent shall not be liable for any error of judgment  made in
good faith by a Responsible  Officer of the  Subordination  Agent,  unless it is
proved that the Subordination  Agent was negligent in ascertaining the pertinent
facts.

          SECTION 6.2 ABSENCE OF DUTIES.  The Subordination  Agent shall have no
duty to see to any recording or filing of this Agreement or any other  document,
or to see to the maintenance of any such recording or filing.

          SECTION 6.3 NO  REPRESENTATIONS  OR WARRANTIES  AS TO  DOCUMENTS.  The
Subordination Agent in its individual capacity does not make nor shall be deemed
to have made any  representation  or  warranty as to the  validity,  legality or
enforceability  of this Agreement or any other Operative  Agreement or as to the
correctness  of  any  statement  contained  in  any  thereof,   except  for  the
representations  and  warranties  of  the  Subordination   Agent,  made  in  its
individual  capacity,  under any Operative Agreement to which it is a party. The
Certificateholders,   the  Trustees  and  the   Liquidity   Providers   make  no
representation or warranty hereunder whatsoever.


<PAGE>


          SECTION 6.4 NO SEGREGATION OF MONIES; NO INTEREST.  Any monies paid to
or retained by the Subordination  Agent pursuant to any provision hereof and not
then  required to be  distributed  to any Trustee or any  Liquidity  Provider as
provided  in  Articles  II and III  hereof or  deposited  into one or more Trust
Accounts need not be  segregated in any manner except to the extent  required by
such  Articles  II and III and by law,  and the  Subordination  Agent  shall not
(except as otherwise  provided in Section 2.2 hereof) be liable for any interest
thereon;  PROVIDED,  HOWEVER, that any payments received or applied hereunder by
the  Subordination  Agent shall be accounted for by the  Subordination  Agent so
that any portion  thereof paid or applied  pursuant hereto shall be identifiable
as to the source thereof.

          SECTION 6.5 RELIANCE;  AGENTS;  ADVICE OF COUNSEL.  The  Subordination
Agent  shall  not incur  liability  to  anyone  in  acting  upon any  signature,
instrument,  notice, resolution,  request, consent, order, certificate,  report,
opinion,  bond or other  document  or paper  believed  by it to be  genuine  and
believed  by it to be  signed by the  proper  party or  parties.  As to the Pool
Balance  of any  Trust  as of any  date,  the  Subordination  Agent  may for all
purposes hereof rely on a certificate  signed by any Responsible  Officer of the
applicable Trustee, and such certificate shall constitute full protection to the
Subordination  Agent for any  action  taken or omitted to be taken by it in good
faith in reliance  thereon.  As to any fact or matter  relating to the Liquidity
Providers  or  the  Trustees  the  manner  of  ascertainment  of  which  is  not
specifically  described  herein,  the  Subordination  Agent may for all purposes
hereof  rely  on a  certificate,  signed  by  any  Responsible  Officer  of  the
applicable Liquidity Provider or Trustee, as the case may be, as to such fact or
matter,   and  such   certificate   shall  constitute  full  protection  to  the
Subordination  Agent for any  action  taken or omitted to be taken by it in good
faith in reliance thereon.  The Subordination  Agent shall assume,  and shall be
fully  protected in assuming,  that each of the Liquidity  Providers and each of
the Trustees are  authorized to enter into this Agreement and to take all action
to be taken by them  pursuant to the  provisions  hereof,  and shall not inquire
into  the  authorization  of each of the  Liquidity  Providers  and  each of the
Trustees with respect thereto.  In the  administration  of the trusts hereunder,
the  Subordination  Agent may  execute  any of the  trusts or powers  hereof and
perform its powers and duties hereunder  directly or through agents or attorneys
and may  consult  with  counsel,  accountants  and other  skilled  persons to be
selected and retained by it, and the Subordination Agent shall not be liable for
the acts or omissions of any agent appointed with due care or for anything done,
suffered or omitted in good faith by it in accordance with the advice or written
opinion of any such counsel, accountants or other skilled persons.

          SECTION 6.6 CAPACITY IN WHICH  ACTING.  The  Subordination  Agent acts
hereunder solely as agent and trustee herein and not in its individual capacity,
except as otherwise expressly provided in the Operative Agreements.

          SECTION 6.7 COMPENSATION. The Subordination Agent shall be entitled to
reasonable compensation,  including expenses and disbursements, for all services
rendered  hereunder  and shall have a priority  claim to the extent set forth in
Article  III hereof on all monies  collected  hereunder  for the payment of such
compensation,  to the extent that such compensation shall not be paid by others.
The  Subordination  Agent agrees that it shall have no right against any Trustee
or  Liquidity  Provider  for any fee as  compensation  for its services as agent


<PAGE>


under this  Agreement.  The  provisions  of this  Section 6.7 shall  survive the
termination of this Agreement.

          SECTION 6.8 MAY BECOME  CERTIFICATEHOLDER.  The institution  acting as
Subordination Agent hereunder may become a Certificateholder and have all rights
and  benefits  of a  Certificateholder  to the same extent as if it were not the
institution acting as the Subordination Agent.

          SECTION 6.9 SUBORDINATION AGENT REQUIRED;  ELIGIBILITY. There shall at
all  times be a  Subordination  Agent  hereunder  which  shall be a  corporation
organized and doing  business  under the laws of the United States of America or
of any State or the District of Columbia  having a combined  capital and surplus
of at least $100,000,000 (or the obligations of which,  whether now in existence
or hereafter incurred, are fully and unconditionally guaranteed by a corporation
organized and doing business under the laws of the United States of America, any
State  thereof or of the District of Columbia and having a combined  capital and
surplus of at least  $100,000,000),  if there is such an institution willing and
able to perform the duties of the Subordination  Agent hereunder upon reasonable
or customary terms. Such corporation shall be a citizen of the United States and
shall be authorized  under the laws of the United States or any State thereof or
of the  District of Columbia to  exercise  corporate  trust  powers and shall be
subject to supervision or examination by federal,  state or District of Columbia
authorities.  If such  corporation  publishes  reports  of  condition  at  least
annually,  pursuant  to  law  or to the  requirements  of  any of the  aforesaid
supervising  or examining  authorities,  then,  for the purposes of this Section
6.9, the combined capital and surplus of such corporation  shall be deemed to be
its  combined  capital  and  surplus as set forth in its most  recent  report of
condition so published.

In case at any time the  Subordination  Agent  shall  cease  to be  eligible  in
accordance with the provisions of this Section,  the  Subordination  Agent shall
resign immediately in the manner and with the effect specified in Section 8.1.

          SECTION 6.10 MONEY TO BE HELD IN TRUST.  All Equipment  Notes,  monies
and other property deposited with or held by the Subordination Agent pursuant to
this Agreement shall be held in trust for the benefit of the parties entitled to
such Equipment  Notes,  monies and other  property.  All such  Equipment  Notes,
monies  or  other  property  shall  be  held  in  the  Trust  Department  of the
institution acting as Subordination Agent hereunder.

                                   ARTICLE VII

                     INDEMNIFICATION OF SUBORDINATION AGENT

          SECTION 7.1 SCOPE OF INDEMNIFICATION. The Subordination Agent shall be
indemnified  hereunder to the extent and in the manner  described in Section 9.1
of the Participation  Agreements.  The indemnities contained in such Section 9.1
shall survive the termination of this Agreement.


<PAGE>


                                  ARTICLE VIII

                          SUCCESSOR SUBORDINATION AGENT

          SECTION  8.1  REPLACEMENT  OF  SUBORDINATION  AGENT;   APPOINTMENT  OF
SUCCESSOR.  The  Subordination  Agent may resign at any time by so notifying the
Trustees and the Liquidity  Providers.  The Controlling  Party (or, prior to the
occurrence of a Triggering  Event, the Person who would be the Controlling Party
if a Triggering Event had occurred) may remove the Subordination Agent for cause
by  so  notifying   the   Subordination   Agent  and  may  appoint  a  successor
Subordination  Agent.  The  Controlling  Party (or, prior to the occurrence of a
Triggering  Event, the Person who would be the Controlling Party if a Triggering
Event had occurred) shall remove the Subordination Agent if:

          (1) the Subordination Agent fails to comply with Section 6.9 hereof;

          (2) the Subordination Agent is adjudged bankrupt or insolvent;

          (3)  a  receiver  or  other  public   officer   takes  charge  of  the
     Subordination Agent or its property; or

          (4) the Subordination Agent otherwise becomes incapable of acting.

          If the  Subordination  Agent  resigns  or is  removed  or if a vacancy
exists in the office of  Subordination  Agent for any reason (the  Subordination
Agent in such  event  being  referred  to herein as the  retiring  Subordination
Agent),  the  Controlling  Party (or,  prior to the  occurrence  of a Triggering
Event,  the Person who would be the Controlling  Party if a Triggering Event had
occurred) shall promptly appoint a successor Subordination Agent.

          A successor Subordination Agent shall deliver (x) a written acceptance
of  its   appointment  as   Subordination   Agent   hereunder  to  the  retiring
Subordination  Agent and (y) a written  assumption of its obligations  hereunder
and  under  each  Liquidity  Facility  to each  party  hereto,  upon  which  the
resignation  or  removal  of  the  retiring  Subordination  Agent  shall  become
effective,  and the  successor  Subordination  Agent  shall have all the rights,
powers and duties of the Subordination Agent under this Agreement. The successor
Subordination  Agent  shall  mail a notice of its  succession  to the  Liquidity
Providers  and the Trustees.  The retiring  Subordination  Agent shall  promptly
transfer  its  rights  under  each of the  Liquidity  Facilities  and all of the
property held by it as Subordination Agent to the successor Subordination Agent.

          If a successor Subordination Agent does not take office within 60 days
after the  retiring  Subordination  Agent  resigns or is removed,  the  retiring
Subordination  Agent or one or more of the  Trustees  may  petition any court of
competent jurisdiction for the appointment of a successor Subordination Agent.

          If the Subordination Agent fails to comply with Section 6.9 hereof (to
the  extent  applicable),  one or  more  of the  Trustees  or one or more of the
Liquidity  Providers  may petition any court of competent  jurisdiction  for the


<PAGE>


removal  of  the  Subordination   Agent  and  the  appointment  of  a  successor
Subordination Agent.

          Notwithstanding  the  foregoing,  no  resignation  or  removal  of the
Subordination  Agent shall be  effective  unless and until a successor  has been
appointed.  No appointment of a successor Subordination Agent shall be effective
unless  and  until  the  Rating   Agencies   shall  have   delivered  a  Ratings
Confirmation.

                                   ARTICLE IX

                           SUPPLEMENTS AND AMENDMENTS

          SECTION 9.1  AMENDMENTS,  WAIVERS,  ETC. (a) This Agreement may not be
supplemented,  amended or modified  without the consent of each Trustee (acting,
except in the case of any amendment pursuant to Section  3.6(e)(v)(y) hereof and
the last  sentence  of this  Section  9.1(a),  with the  consent  of  holders of
Certificates  of the related  Class  evidencing  interests in the related  Trust
aggregating  not less than a majority in interest in such Trust or as  otherwise
authorized  pursuant to the relevant Trust Agreement),  the Subordination  Agent
and each  Liquidity  Provider;  provided,  however,  that this  Agreement may be
supplemented,  amended or  modified  without  the consent of any Trustee if such
supplement,  modification  or amendment cures an ambiguity or  inconsistency  or
does not materially  adversely affect such Trustee or the holders of the related
Class of  Certificates;  PROVIDED  FURTHER,  HOWEVER,  that if such  supplement,
amendment or modification  would (x) directly or indirectly modify or supersede,
or otherwise  conflict with,  Section  2.2(b),  3.6(e) or 3.6(f) (other than the
last sentence  thereof),  the last sentence of this Section 9.1(a) or the second
sentence  of  Section  10.6  (collectively,  together  with  this  proviso,  the
"CONTINENTAL  PROVISIONS") or (y) otherwise  adversely affect the interests of a
potential  Replacement  Liquidity Provider or of Continental with respect to its
ability  to replace  any  Liquidity  Facility  or with  respect  to its  payment
obligations  under any  Participation  Agreement or Lease, then such supplement,
amendment or modification  shall not be effective without the additional written
consent of Continental.  Notwithstanding  the foregoing,  without the consent of
each Certificateholder and each Liquidity Provider, no supplement,  amendment or
modification  of this Agreement may (i) reduce the percentage of the interest in
any Trust  evidenced  by the  Certificates  issued by such  Trust  necessary  to
consent  to  modify  or  amend  any  provision  of this  Agreement  or to  waive
compliance therewith or (ii) modify Section 2.4, 3.2 or 3.3 hereof,  relating to
the  distribution of monies received by the  Subordination  Agent hereunder from
the Equipment Notes or pursuant to the Liquidity  Facilities.  Nothing contained
in this Section shall require the consent of a Trustee at any time following the
payment  of  Final   Distributions   with  respect  to  the  related   Class  of
Certificates.  If the Replacement  Liquidity Facility for any Liquidity Facility
in  accordance  with Section  3.6(e)  hereof is to be comprised of more than one
instrument as contemplated by the definition of the term "Replacement  Liquidity
Facility",  then each of the parties  hereto  agrees to amend this  Agreement to
incorporate  appropriate  mechanics  for multiple  Liquidity  Facilities  for an
individual Trust.

          (b) In the  event  that the  Subordination  Agent,  as the  registered
holder of any  Equipment  Notes,  receives  a  request  for its  consent  to any


<PAGE>


amendment,  modification  or waiver under such  Equipment  Notes,  the Indenture
pursuant  to which such  Equipment  Notes were  issued,  or the  related  Lease,
Participation  Agreement or other related document,  (i) if no Indenture Default
shall have  occurred  and be  continuing  with  respect to such  Indenture,  the
Subordination Agent shall request directions with respect to each Series of such
Equipment  Notes from the Trustee of the Trust which holds such Equipment  Notes
and shall vote or consent in accordance  with the directions of such Trustee and
(ii) if any Indenture  Default (which has not been cured by the applicable Owner
Trustee or the applicable Owner Participant, if applicable,  pursuant to Section
4.03 of such  Indenture)  shall have occurred and be continuing  with respect to
such  Indenture,  the  Subordination  Agent will  exercise its voting  rights as
directed  by the  Controlling  Party,  subject to  Sections  4.1 and 4.4 hereof;
PROVIDED  that no such  amendment,  modification  or waiver  shall,  without the
consent of each Liquidity Provider, reduce the amount of rent, supplemental rent
or stipulated loss values payable by Continental under any Lease.

          SECTION  9.2  SUBORDINATION  AGENT  PROTECTED.  If, in the  reasonable
opinion of the institution  acting as the  Subordination  Agent  hereunder,  any
document  required to be  executed  pursuant to the terms of Section 9.1 affects
any right,  duty,  immunity or indemnity with respect to it under this Agreement
or any Liquidity Facility, the Subordination Agent may in its discretion decline
to execute such document.

          SECTION 9.3 EFFECT OF SUPPLEMENTAL  AGREEMENTS.  Upon the execution of
any amendment,  consent or supplement hereto pursuant to the provisions  hereof,
this Agreement shall be and be deemed to be and shall be modified and amended in
accordance   therewith  and  the  respective  rights,   limitations  of  rights,
obligations,  duties and  immunities  under this Agreement of the parties hereto
and beneficiaries hereof shall thereafter be determined,  exercised and enforced
hereunder subject in all respects to such modifications and amendments,  and all
the terms and  conditions  of any such  supplemental  agreement  shall be and be
deemed to be and shall be part of the terms and conditions of this Agreement for
any and all  purposes.  In  executing or accepting  any  supplemental  agreement
permitted  by this  Article  IX, the  Subordination  Agent  shall be entitled to
receive,  and shall be fully  protected in relying  upon,  an opinion of counsel
stating that the  execution of such  supplemental  agreement  is  authorized  or
permitted by this Agreement.

          SECTION 9.4 NOTICE TO RATING AGENCIES.  Promptly following its receipt
of each amendment, consent,  modification,  supplement or waiver contemplated by
this  Article  IX, the  Subordination  Agent  shall send a copy  thereof to each
Rating Agency.

                                    ARTICLE X

                                  MISCELLANEOUS

          SECTION 10.1 TERMINATION OF INTERCREDITOR AGREEMENT. Following payment
of Final  Distributions  with  respect  to each  Class of  Certificates  and the
payment in full of all  Liquidity  Obligations  to the  Liquidity  Providers and
PROVIDED   that   there   shall   then   be  no   other   amounts   due  to  the
Certificateholders,  the Trustees, the Liquidity Providers and the Subordination
Agent  hereunder or under the Trust  Agreements,  and that the commitment of the
Liquidity  Providers under the Liquidity  Facilities  shall have expired or been


<PAGE>


terminated,  this Agreement and the trusts  created  hereby shall  terminate and
this  Agreement  shall be of no further force or effect.  Except as aforesaid or
otherwise provided,  this Agreement and the trusts created hereby shall continue
in full force and effect in accordance with the terms hereof.

          SECTION  10.2   INTERCREDITOR   AGREEMENT  FOR  BENEFIT  OF  TRUSTEES,
LIQUIDITY PROVIDERS AND SUBORDINATION  AGENT.  Subject to the second sentence of
Section  10.6 and the  provisions  of Section  4.4,  nothing in this  Agreement,
whether express or implied,  shall be construed to give to any Person other than
the Trustees,  the Liquidity  Providers and the Subordination Agent any legal or
equitable right, remedy or claim under or in respect of this Agreement.

          SECTION  10.3  NOTICES.   Unless  otherwise   expressly  specified  or
permitted by the terms hereof, all notices, requests,  demands,  authorizations,
directions,  consents,  waivers  or  documents  provided  or  permitted  by this
Agreement to be made, given,  furnished or filed shall be in writing,  mailed by
certified mail, postage prepaid, or by confirmed telecopy and

          (i)  if to the Subordination Agent, addressed to at its office at:

               WILMINGTON TRUST COMPANY
               One Rodney Square
               1100 N. Market Street
               Wilmington, DE 19890-0001

               Attention: Corporate Trust Trustee Administration
               Telecopy: (302) 651-8882

          (ii) if to any Trustee, addressed to it at its office at:

               WILMINGTON TRUST COMPANY
               One Rodney Square
               1100 N. Market Street
               Wilmington, DE 19890-0001

               Attention: Corporate Trust Trustee Administration
               Telecopy: (302) 651-8882

          (iii) if to any Liquidity Provider, addressed to it at its office at:

               ABN AMRO Bank N.V.
               Aerospace Department
               135 South LaSalle Street, #820
               Chicago, IL 60674-9135

               Attention: Claudia Heldring, V.P.
               Telephone: (312) 904-5031
               Telecopy: (312) 606-8428


<PAGE>

          with a copy to:

               ABN AMRO Bank N.V.
               135 South LaSalle Street, #625
               Chicago, IL 60674-9135

               Attention: Loan Operations
               Telephone: (312) 904-2961
               Telecopy: (312) 606-6893

Whenever  any  notice in  writing  is  required  to be given by any  Trustee  or
Liquidity Provider or the Subordination  Agent to any of the other of them, such
notice shall be deemed given and such requirement  satisfied when such notice is
received. Any party hereto may change the address to which notices to such party
will be sent by giving  notice  of such  change  to the  other  parties  to this
Agreement.

          SECTION 10.4  SEVERABILITY.  Any provision of this Agreement  which is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

          SECTION 10.5 NO ORAL MODIFICATIONS OR CONTINUING  WAIVERS. No terms or
provisions of this  Agreement may be changed,  waived,  discharged or terminated
orally, but only by an instrument in writing signed by the party or other Person
against whom  enforcement  of the change,  waiver,  discharge or  termination is
sought and any other party or other Person whose consent is required pursuant to
this Agreement and any waiver of the terms hereof shall be effective only in the
specific instance and for the specific purpose given.

          SECTION 10.6  SUCCESSORS  AND ASSIGNS.  All covenants  and  agreements
contained herein shall be binding upon, and inure to the benefit of, each of the
parties hereto and the  successors and assigns of each, all as herein  provided.
In  addition,   the  Continental  Provisions  shall  inure  to  the  benefit  of
Continental  and its  successors  and assigns,  and (without  limitation  of the
foregoing) Continental is hereby constituted, and agreed to be, an express third
party beneficiary of the Continental Provisions.

          SECTION  10.7  HEADINGS.  The  headings  of the various  Articles  and
Sections  herein  and in the table of  contents  hereto are for  convenience  of
reference  only and  shall not  define  or limit any of the terms or  provisions
hereof.

          SECTION 10.8  COUNTERPART  FORM. 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 agreement.

          SECTION 10.9 SUBORDINATION. (a) As between the Liquidity Providers, on
the one hand,  and the Trustees and the  Certificateholders,  on the other hand,


<PAGE>

this Agreement shall be a subordination agreement for purposes of Section 510 of
the United States Bankruptcy Code, as amended from time to time.

          (b) Notwithstanding the provisions of this Agreement,  if prior to the
payment in full to the Liquidity Providers of all Liquidity Obligations then due
and payable, any party hereto shall have received any payment or distribution in
respect of Equipment  Notes or any other amount  under the  Indentures  or other
Operative  Agreements which, had the subordination  provisions of this Agreement
been properly applied to such payment,  distribution or other amount,  would not
have been distributed to such Person,  then such payment,  distribution or other
amount  shall be  received  and held in trust by such  Person  and paid  over or
delivered to the Subordination Agent for application as provided herein.

          (c) If any Trustee,  any Liquidity Provider or the Subordination Agent
receives any payment in respect of any  obligations  owing hereunder (or, in the
case of the Liquidity Providers, in respect of the Liquidity Obligations), which
is subsequently invalidated, declared preferential, set aside and/or required to
be repaid to a trustee,  receiver or other  party,  then,  to the extent of such
payment,  such  obligations  (or, in the case of the Liquidity  Providers,  such
Liquidity Obligations) intended to be satisfied shall be revived and continue in
full force and effect as if such payment had not been received.

          (d)  The  Trustees  (on  behalf  of  themselves  and  the  holders  of
Certificates),  the Liquidity Providers and the Subordination Agent confirm that
the payment priorities specified in Sections 2.4, 3.2 and 3.3 shall apply in all
circumstances,  notwithstanding  the  fact  that  the  obligations  owed  to the
Trustees and the holders of  Certificates  are secured by certain assets and the
Liquidity  Obligations may not be so secured.  The Trustees  expressly agree (on
behalf of themselves  and the holders of  Certificates)  not to assert  priority
over the  holders  of  Liquidity  Obligations  due to their  status  as  secured
creditors in any bankruptcy, insolvency or other legal proceeding.

          (e) Each of the Trustees (on behalf of  themselves  and the holders of
Certificates),  the Liquidity Providers and the Subordination Agent may take any
of the following actions without impairing its rights under this Agreement:

               (i) obtain a Lien on any property to secure any amounts  owing to
     it  hereunder,  including,  in the  case of the  Liquidity  Providers,  the
     Liquidity Obligations,

               (ii)  obtain the  primary or  secondary  obligation  of any other
     obligor with respect to any amounts  owing to it hereunder,  including,  in
     the case of the Liquidity Providers, any of the Liquidity Obligations,

               (iii)  renew,  extend,  increase,  alter or exchange  any amounts
     owing to it hereunder,  including,  in the case of the Liquidity Providers,
     any of the Liquidity  Obligations,  or release or compromise any obligation
     of any obligor with respect thereto,

               (iv) refrain  from  exercising  any right or remedy,  or delay in
     exercising such right or remedy, which it may have, or


<PAGE>

               (v) take any other  action which might  discharge a  subordinated
     party or a surety under applicable law;

PROVIDED,  HOWEVER,  that the taking of any such actions by any of the Trustees,
the  Liquidity  Providers or the  Subordination  Agent shall not  prejudice  the
rights or  adversely  affect  the  obligations  of any other  party  under  this
Agreement.

          SECTION 10.10  GOVERNING LAW. 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.

          SECTION 10.11 SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; WAIVER
OF  IMMUNITY.   (a)  Each  of  the  parties   hereto  hereby   irrevocably   and
unconditionally:

               (i)  submits for itself and its  property in any legal  action or
     proceeding relating to this Agreement or any other Operative Agreement,  or
     for  recognition  and  enforcement  of any  judgment  in respect  hereof or
     thereof,  to the  nonexclusive  general  jurisdiction  of the courts of the
     State of New York,  the  courts of the  United  States of  America  for the
     Southern District of New York, and the appellate courts from any thereof;

               (ii) consents  that any such action or proceeding  may be brought
     in such courts,  and waives any objection that it may now or hereafter have
     to the venue of any such  action or  proceeding  in any such  court or that
     such action or proceeding was brought in an  inconvenient  court and agrees
     not to plead or claim the same;

               (iii)  agrees  that  service  of  process  in any such  action or
     proceeding  may be  effected  by mailing a copy  thereof by  registered  or
     certified  mail  (or any  substantially  similar  form and  mail),  postage
     prepaid,  to each party  hereto at its  address  set forth in Section  10.3
     hereof, or at such other address of which the other parties shall have been
     notified pursuant thereto; and

               (iv) agrees that nothing  herein shall affect the right to effect
     service of process in any other manner  permitted by law or shall limit the
     right to sue in any other jurisdiction.

          (b) EACH OF THE PARTIES  HERETO HEREBY AGREES TO WAIVE ITS  RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF
THIS  AGREEMENT  AND THE  RELATIONSHIP  THAT IS  BEING  ESTABLISHED,  including,
without limitation,  contract claims, tort claims, breach of duty claims and all
other  common  law and  statutory  claims.  Each  of the  parties  warrants  and
represents that it has reviewed this waiver with its legal counsel,  and that it
knowingly and voluntarily  waives its jury trial rights  following  consultation
with such legal  counsel.  THIS  WAIVER IS  IRREVOCABLE,  AND CANNOT BE MODIFIED


<PAGE>

EITHER  ORALLY OR IN  WRITING,  AND THIS WAIVER  SHALL  APPLY TO ANY  SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

          (c) The Liquidity Provider hereby waives any immunity it may have from
the  jurisdiction  of the courts of the United States of America or of any State
and waives any immunity any of its  properties  located in the United States may
have from  attachment  or  execution  upon a judgment  entered by any such court
under the United States Foreign Sovereign  Immunities Act of 1976 or any similar
successor legislation.


<PAGE>

          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,  and  acknowledge  that this Agreement has
been made and delivered in The City of New York,  and this  Agreement has become
effective only upon such execution and delivery.

                                        WILMINGTON TRUST COMPANY,
                                          not in  its  individual  capacity  but
                                          solely  as  Trustee  for  each  of the
                                          Trusts



                                        By______________________________________
                                          Name:
                                          Title:

                                        SABN AMRO BANK N.V., acting through its
                                          Chicago  branch,  as Class A Liquidity
                                          Provider,  Class B Liquidity  Provider
                                          and Class C Liquidity Provider



                                        By______________________________________
                                          Name:
                                          Title:



                                        By______________________________________
                                          Name:
                                          Title:

                                        WILMINGTON TRUST COMPANY, not in its
                                          individual    capacity    except    as
                                          expressly  set forth herein but solely
                                          as Subordination Agent and trustee



                                        By______________________________________
                                          Name:
                                          Title:


<PAGE>


                                  Schedule I to
                             INTERCREDITOR AGREEMENT
                             -----------------------


<TABLE>
<CAPTION>

          AIRCRAFT TYPE                    REGISTRATION NUMBER
          -------------                    -------------------

<S>                                        <C>
          Embraer EMB-145                  N14925

          Embraer EMB-145                  N15926

          Embraer EMB-145                  N16927

          Embraer EMB-145                  N17928

          Embraer EMB-145                  N13929

          Embraer EMB-145                  N14930

          Embraer EMB-145                  N14931

          Embraer EMB-145                  N15932

          Embraer EMB-145                  N14933

</TABLE>





================================================================================


                              TRUST AGREEMENT ____



                         Dated as of September 25, 1997



                                     Between



                                 ICX CORPORATION



                                       and



                    FIRST SECURITY BANK, NATIONAL ASSOCIATION



                       One Embraer Model EMB-145 Aircraft
                    Bearing Manufacturer's Serial No. 145.___
                        and U.S. Registration No. N_____
                     with Two Allison Model AE3007A Engines
          Bearing Engine Manufacturer's Serial Nos. _______ and _______


================================================================================


<PAGE>


<TABLE>
<CAPTION>

                               TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

<S>          <C>                                                             <C>
SECTION 1.   DEFINITIONS................................................       1

SECTION 2.   DECLARATION OF TRUST.......................................       1

SECTION 3.   AUTHORIZATION; CONDITIONS PRECEDENT........................       1
             3.1   Authorization........................................       1
             3.2   Conditions Precedent.................................       2

SECTION 4.   RECEIPT, DISTRIBUTION AND APPLICATION OF
             INCOME FROM THE TRUST ESTATE...............................       3
             4.1   Payments from Trust Estate Only......................       3
             4.2   Distribution of Payments.............................       3
                   4.2.1   Payments to Mortgagee........................       3
                   4.2.2   Payments to Owner Trustee, Other Parties.....       3
                   4.2.3   Certain Distributions to Owner Participant...       4
                   4.2.4   Excluded Payments............................       4
             4.3   Method of Payments...................................       4

SECTION 5.   DUTIES OF OWNER TRUSTEE....................................       4
             5.1   Notice of Event of Default...........................       4
             5.2   Action upon Instructions.............................       5
             5.3   Limitations on Duties................................       5
             5.4   No Duties except as Specified; No Action except as
                   Specified............................................       6
                   5.4.1   No Duties except as Specified................       6
                   5.4.2   No Action except as Specified................       6
             5.5   Satisfaction of Conditions Precedent.................       6
             5.6   Fixed Investment Trust...............................       7

SECTION 6.   OWNER TRUSTEE..............................................       7
             6.1   Acceptance of Trusts and Duties......................       7

             6.2   Absence of Certain Duties............................       7
             6.3   No Representations or Warranties as to Certain
                   Matters..............................................       8
             6.4   No Segregation of Monies; Interest...................       9
             6.5   Reliance upon Certificates, Counsel and Agents.......       9
             6.6   Not Acting in Individual Capacity....................      10


<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)

                                                                            PAGE
                                                                            ----

             6.7   Fees; Compensation...................................      10
             6.8   Tax Returns..........................................      10
 
SECTION 7.   INDEMNIFICATION OF FIRST SECURITY BY
             OWNER PARTICIPANT..........................................      11

SECTION 8.   TRANSFER OF OWNER PARTICIPANT'S INTEREST...................      12
             8.1   Transfer of Interest.................................      12

SECTION 9.   SUCCESSOR OWNER TRUSTEES; CO-TRUSTEES......................      12
             9.1   Resignation of Owner Trustee; Appointment
                   of Successor.........................................      12
                   9.1.1   Resignation or Removal.......................      12
                   9.1.2   Execution and Delivery of Documents, Etc.....      13
                   9.1.3   Qualifications...............................      13
                   9.1.4   Merger, Etc..................................      13
             9.2   Co-Trustees and Separate Trustees....................      14

SECTION 10.  SUPPLEMENTS AND AMENDMENTS TO TRUST
             AGREEMENT AND OTHER DOCUMENTS..............................      15
             10.1  Supplements and Amendments and Delivery
                   Thereof..............................................      15
                   10.1.1  Supplements and Amendments...................      15
                   10.1.2  Delivery of Amendments and Supplements
                           to Certain Parties...........................      16
             10.2  Discretion as to Execution of Documents..............      16
             10.3  Absence of Requirements as to Form...................      16
             10.4  Distribution of Documents............................      16
             10.5  No Request Needed as to Lease Supplement and
                   Trust Indenture Supplement...........................      16

SECTION 11.  MISCELLANEOUS..............................................      16
             11.1  Termination of Trust Agreement.......................      16
             11.2  Termination at Option of the Owner Participant.......      17
             11.3  Owner Participant Has No Legal Title in Trust
                   Estate...............................................      17
             11.4  Assignment, Sale, etc. of Aircraft...................      17
             11.5  Trust Agreement for Benefit of Certain Parties Only..      18
             11.6  Citizenship of Owner Participant.....................      18



<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)

                                                                            PAGE
                                                                            ----
            11.7  Notices...............................................      18
            11.8  Severability..........................................      18
            11.9  Waivers, Etc..........................................      19
            11.10 Counterparts..........................................      19
            11.11 Binding Effect, Etc...................................      19
            11.12 Headings; References..................................      19
            11.13 Governing Law.........................................      19

</TABLE>



<PAGE>

                              TRUST AGREEMENT ____

          This TRUST AGREEMENT ____, dated as of September 25, 1997, between ICX
CORPORATION, an Ohio corporation ("Owner Participant"), and FIRST SECURITY BANK,
NATIONAL  ASSOCIATION,   a  national  banking  association  (in  its  individual
capacity,  "First  Security" and otherwise  not in its  individual  capacity but
solely as trustee hereunder, "Owner Trustee").

                              W I T N E S S E T H:
                              - - - - - - - - - - 

          SECTION 1.  DEFINITIONS

          Capitalized   terms  used  but  not  defined  herein  shall  have  the
respective  meanings  set  forth or  incorporated  by  reference,  and  shall be
construed and interpreted in the manner described, in Annex A to the Lease.

          SECTION 2.  DECLARATION OF TRUST

          First Security  hereby  declares that it will hold the Trust Estate as
Owner Trustee upon the trusts  hereinafter  set forth for the use and benefit of
Owner Participant,  subject,  however, to the provisions of and the Lien created
by the Trust Indenture and to the provisions of the Lease and the  Participation
Agreement.

          SECTION 3.  AUTHORIZATION; CONDITIONS PRECEDENT

          3.1 Authorization

          In respect of the Aircraft,  Owner  Participant  hereby authorizes and
directs  Owner  Trustee  to, and Owner  Trustee  agrees for the benefit of Owner
Participant  that it will, on and after the Delivery Date,  subject (except with
respect to Section 3.1(a)) to due compliance with the terms of Section 3.2:

          (a)  execute  and  deliver  the  Participation  Agreement,  the  Trust
Indenture,  the Lease and the other Owner Trustee  Agreements (in the respective
forms in which  they are  delivered  from time to time by Owner  Participant  to
Owner Trustee);

          (b)  subject to the terms of this Trust  Agreement,  exercise  (i) its
rights and perform its duties under the Participation Agreement, (ii) the rights
and  perform  the  duties of Lessor  under  the Lease and (iii) its  rights  and
perform  its  duties  under the Trust  Indenture  and the  other  Owner  Trustee
Agreements;

          (c) execute,  issue and deliver to Mortgagee  for  authentication  and
further  delivery to the  Subordination  Agent the Equipment Notes in the amount
and as provided in Section 2 of the Participation Agreement;

          (d) purchase the Aircraft pursuant to the Participation Agreement;


<PAGE>

          (e) accept from  Existing  Lessor the delivery of the Aircraft Bill of
Sale, the FAA Bill of Sale and the invoice with respect to such Aircraft;

          (f) effect the  registration  of the Aircraft with the FAA in the name
of Owner Trustee by filing or causing to be filed with the FAA: (i) the FAA Bill
of Sale; (ii) an Aircraft Registration  Application in the name of Owner Trustee
(including,  without  limitation,  an affidavit from Owner Trustee in compliance
with the  provisions of Section  47.7(c)(2) of the FAA  Regulations);  and (iii)
this Trust Agreement;

          (g)  execute  and  deliver  the  Financing  Statements  referred to in
Section  5.1.2 (xxiv) of the  Participation  Agreement,  together with all other
agreements,   documents  and  instruments  referred  to  in  Section  5  of  the
Participation Agreement to which Owner Trustee is to be a party;

          (h) make payment of Lessor's  Cost for the Aircraft from the aggregate
amount  of the  Commitments  for the  Aircraft  of  Owner  Participant  and Loan
Participant,  to the extent received by Owner Trustee, in the manner provided in
the Participation Agreement;

          (i) execute and deliver Lease Supplement No. 1 covering the Aircraft;

          (j) execute  and deliver a Trust  Indenture  Supplement  covering  the
Aircraft; and

          (k)  execute  and deliver  all such other  instruments,  documents  or
certificates and take all such other actions in accordance with the direction of
Owner  Participant,  as Owner  Participant  may deem  necessary  or advisable in
connection  with the  transactions  contemplated by this Trust Agreement and the
other Operative Agreements.

          3.2 Conditions Precedent

          The  rights  and  obligations  of Owner  Trustee  to take the  actions
required by Section 3.1 shall be subject to the following conditions precedent:

          (a) Owner Trustee shall have received the notice  described in Section
5.1.1 of the Participation  Agreement,  when and as required  thereby,  or shall
have been deemed to have waived such notice in accordance  with Section 5.1.1 of
the Participation Agreement;

          (b) Each Participant shall have made the full amount of its Commitment
specified  in Section  2.1 of the  Participation  Agreement  available  to Owner
Trustee, in immediately  available funds, in accordance with Sections 2 and 4 of
the Participation Agreement; and

          (c) Owner Participant shall have notified Owner Trustee that the terms
and  conditions  of Section 5 of the  Participation  Agreement,  insofar as they
relate to  conditions  precedent  to  performance  by Owner  Participant  of its
obligations  thereunder,  have been either  fulfilled to the satisfaction of, or


<PAGE>

waived by, Owner  Participant.  Owner  Participant  shall, by instructing  Owner
Trustee to release the full amount of its Commitment  then held by Owner Trustee
as provided in Section 2 of the Participation Agreement, be deemed to have found
satisfactory to it, or waived, all such conditions precedent.

          SECTION  4.  RECEIPT, DISTRIBUTION  AND APPLICATION OF INCOME FROM THE
TRUST ESTATE

          4.1 Payments from Trust Estate Only

          Except as  provided  in  Section 7, all  payments  to be made by Owner
Trustee  under this Trust  Agreement  shall be made only from (a) in the case of
funds  made  available  in  accordance  with  Section  4  of  the  Participation
Agreement,  the Commitments  (except as otherwise  provided in Section 14 of the
Participation  Agreement) and (b) in the case of all other payments,  the income
from and  proceeds of the Trust  Estate to the extent that Owner  Trustee  shall
have received  sufficient  income or proceeds from the Trust Estate to make such
payments.  Owner Participant  agrees that it will look solely (y) in the case of
funds  made  available  in  accordance  with  Section  4  of  the  Participation
Agreement,  to the  Commitments  and any income  therefrom  (except as otherwise
provided in Section 14 of the  Participation  Agreement)  and (z) in the case of
all other  payments,  to the income from and proceeds of the Trust Estate to the
extent available for distribution to Owner Participant as provided in this Trust
Agreement.  Except as provided in Section 7, Owner Participant agrees that First
Security  is neither  personally  liable to Owner  Participant  for any  amounts
payable nor subject to any other liability under this Trust Agreement.

          4.2 Distribution of Payments

               4.2.1 Payments to Mortgagee

          Until the Trust  Indenture  shall  have been  discharged  pursuant  to
Section 10.01 thereof,  all Rent,  insurance  proceeds and  requisition or other
payments of any kind included in the Trust Estate (other than Excluded Payments)
payable to Owner Trustee shall be payable  directly to Mortgagee (and, if any of
the same are  received  by Owner  Trustee,  shall  upon  receipt be paid over to
Mortgagee without deduction, set-off or adjustment of any kind) for distribution
in  accordance  with the  provisions  of  Article  III of the  Trust  Indenture;
PROVIDED,  that any  payments  received  by  Owner  Trustee  from  (a)  Airframe
Manufacturer with respect to Owner Trustee's fees and disbursements or (b) Owner
Participant  pursuant to Section 7 shall not be paid over to Mortgagee but shall
be  retained  by Owner  Trustee  and  applied  toward the purpose for which such
payments were made.

               4.2.2 Payments to Owner Trustee, Other Parties

          After the Trust  Indenture  shall  have been  discharged  pursuant  to
Section  10.01  thereof,  any payment of the type  referred to in Section  4.2.1
(other than Excluded Payments)  received by Owner Trustee,  any payment received
from Mortgagee  (other than Excluded  Payments) and any other amount received as
part of the Trust Estate and for the  application  or  distribution  of which no


<PAGE>

provision is made in this Trust  Agreement  shall be distributed  forthwith upon
receipt by Owner Trustee in the following  order of priority:  FIRST, so much of
such  payment as shall be required to reimburse  Owner  Trustee for any expenses
not  otherwise  reimbursed  as to  which  Owner  Trustee  is  entitled  to be so
reimbursed pursuant to the provisions hereof shall be retained by Owner Trustee;
SECOND,  the amount set forth in Schedule 1 hereto,  if any,  on a Payment  Date
shall be paid to Owner  Participant;  THIRD,  the amount set forth in Schedule 2
hereto shall be paid to Equity Guarantor; and FOURTH, the balance, if any, shall
be paid to Owner Participant.

               4.2.3 Certain Distributions to Owner Participant

          All amounts  from time to time  distributable  by  Mortgagee  to Owner
Participant  pursuant to the Trust Indenture shall, if paid to Owner Trustee, be
distributed  by  Owner  Trustee  to Owner  Participant  in  accordance  with the
provisions of Article III of the Trust  Indenture;  PROVIDED,  that any payments
received by Owner Trustee from (a) Lessee with respect to Owner  Trustee's  fees
and  disbursements or (b) Owner  Participant  pursuant to Section 7 shall not be
paid  over to Owner  Participant  but shall be  retained  by Owner  Trustee  and
applied toward the purpose for which such payments were made.

               4.2.4 Excluded Payments

          Any Excluded Payments received by Owner Trustee shall be paid by Owner
Trustee to the  Person to whom such  Excluded  Payments  are  payable  under the
provisions of the Participation  Agreement,  the Tax Indemnity  Agreement or the
Lease.

          4.3 Method of Payments

          Owner Trustee shall make  distributions  or cause  distributions to be
made to Owner Participant  pursuant to this Section 4 by transferring the amount
to be  distributed by wire transfer in  immediately  available  funds on the day
received  (or  on the  next  succeeding  Business  Day  if  the  funds  to be so
distributed  shall not have been  received by Owner  Trustee by 12:00 noon,  New
York City time,  and which funds Owner  Trustee  shall not have been  reasonably
able  to  distribute  to  Owner  Participant  on  the  day  received)  to  Owner
Participant's account set forth in Schedule 1 to the Participation  Agreement or
to such other account or accounts of Owner  Participant as Owner Participant may
designate  from time to time in writing to Owner Trustee;  PROVIDED,  that Owner
Trustee shall use reasonable  efforts to invest  overnight,  in investments that
would be permitted  under Section 4.4 of the Lease,  all funds received by it at
or later than 12:00 noon,  New York City time,  and which  funds  Owner  Trustee
shall not have been  reasonably  able to distribute to Owner  Participant on the
day received).

          SECTION 5.  DUTIES OF OWNER TRUSTEE

          5.1 Notice of Event of Default

          (a) If Owner  Trustee  shall have  knowledge  of a Lease  Default or a
Lease Event of Default or an Indenture Default or an Indenture Event of Default,
Owner  Trustee  shall give to Owner  Participant,  Mortgagee,  Lessee and Equity


<PAGE>

Guarantor  prompt   telephonic  or  telex  notice  thereof  followed  by  prompt
confirmation thereof by certified mail, postage prepaid,  PROVIDED,  that (i) in
the  case of an event  which  with  the  passage  of time  would  constitute  an
Indenture  Event of Default of the type  referred to in paragraph  (c) or (e) of
Section 4.02 of the Trust Indenture,  such notice shall in no event be furnished
later than ten days after Owner Trustee shall first have knowledge of such event
and (ii) in the case of a  misrepresentation  by Owner  Trustee  which  with the
passage  of time  would  constitute  an  Indenture  Event of Default of the type
referred to in paragraph (d) of Section 4.02 of the Trust Indenture, such notice
shall in no event be  furnished  later than ten days after Owner  Trustee  shall
first have knowledge of such event.

          (b) Subject to the terms of Section 5.3, Owner Trustee shall take such
action or shall  refrain  from taking such  action,  not  inconsistent  with the
provisions of the Trust  Indenture,  with respect to such Lease  Default,  Lease
Event of Default, Indenture Default or Indenture Event of Default or other event
as Owner  Trustee  shall be  directed in writing by Owner  Participant.  For all
purposes of this Trust Agreement,  the Lease and the other Operative Agreements,
in the absence of Actual Knowledge of Owner Trustee,  Owner Trustee shall not be
deemed to have knowledge of a Lease Default,  Lease Event of Default,  Indenture
Default or Indenture  Event of Default unless  notified in writing by Mortgagee,
Owner Participant or Lessee.

          5.2 Action upon Instructions

          Subject  to the  terms  of  Sections  5.1 and 5.3,  upon  the  written
instructions  at any  time and from  time to time of  Owner  Participant,  Owner
Trustee  will take such of the  following  actions,  not  inconsistent  with the
provisions  of the Lease and the Trust  Indenture,  as may be  specified in such
instructions:  (a) give such notice or direction or exercise such right,  remedy
or power under this Trust Agreement or any of the other Owner Trustee Agreements
or in respect of all or any part of the Trust Estate, or take such other action,
as shall  be  specified  in such  instructions  (including  entering  into  such
agreements  and  instruments  as shall be necessary  under Section 10); (b) take
such action to preserve or protect the Trust Estate  (including the discharge of
Liens) as may be specified in such instructions;  (c) approve as satisfactory to
it all  matters  required  by the  terms  of the  Lease or the  other  Operative
Agreements to be satisfactory to Owner Trustee, it being understood that without
written  instructions of Owner Participant,  Owner Trustee shall not approve any
such matter as satisfactory to it; (d) subject to the rights of Lessee under the
Operative Agreements,  after the expiration or earlier termination of the Lease,
convey all of Owner Trustee's  right,  title and interest in and to the Aircraft
for such amount,  on such terms and to such  purchaser or purchasers as shall be
designated in such  instructions,  or retain,  lease or otherwise dispose of, or
from time to time take such other  action with  respect to, the Aircraft on such
terms as shall be designated in such instructions;  and (e) take or refrain from
taking such other action or actions as may be specified in such instructions.

          5.3 Limitations on Duties

          Owner  Trustee  shall not be required to take any action under Section
5.1 (other than the giving of the  notices  referred to therein) or 5.2 if Owner
Trustee shall  reasonably  believe such action is not adequately  indemnified by


<PAGE>

Owner Participant under Section 7, unless Lessee or Owner Participant  agrees to
furnish such additional indemnity as shall reasonably be required, in manner and
form satisfactory to Owner Trustee, and, in addition to the extent not otherwise
paid pursuant to the provisions of the Lease or of the Participation  Agreement,
to pay the reasonable  compensation of Owner Trustee for the services  performed
or to be performed by it pursuant to such direction and any reasonable  fees and
disbursements  of  counsel or agents  employed  by Owner  Trustee in  connection
therewith.  Owner Trustee shall not be required to take any action under Section
5.1 or 5.2 (other than the giving of the  notices  referred to therein) if Owner
Trustee  shall have been  advised by counsel that such action is contrary to the
terms of any of the Owner Trustee Agreements or is otherwise contrary to Law and
Owner Trustee has delivered to Owner Participant written notice of the basis for
its refusal to act.

          5.4 No Duties except as Specified; No Action except as Specified

               5.4.1 No Duties except as Specified

          Owner  Trustee  shall  not  have  any duty or  obligation  to  manage,
control,  use, sell, dispose of or otherwise deal with the Aircraft or any other
part of the Trust Estate or to otherwise  take or refrain from taking any action
under,  or in connection  with, any of the Owner Trustee  Agreements,  except as
expressly required by the terms of any of the Owner Trustee  Agreements,  or (to
the extent not  inconsistent  with the  provisions  of the Trust  Indenture)  as
expressly  provided by the terms hereof or in a written  instruction  from Owner
Participant received pursuant to the terms of Section 5.1 or 5.2, and no implied
duties or  obligations  shall be read into this Trust  Agreement  against  Owner
Trustee.  First Security agrees that it will, in its individual  capacity and at
its own cost or expense  (but  without any right of  indemnity in respect of any
such cost or expense hereunder or under the Participation  Agreement),  promptly
take such action as may be necessary to duly  discharge  and satisfy in full all
Lessor Liens attributable to it in its individual  capacity which it is required
to  discharge  pursuant  to Section  7.3.1 of the  Participation  Agreement  and
otherwise comply with the terms of said Section binding upon it.

               5.4.2 No Action except as Specified

          Owner Trustee  shall have no power,  right or authority to, and agrees
that it will not, manage,  control, use, sell, dispose of or otherwise deal with
the  Aircraft  or any other part of the Trust  Estate  except  (a) as  expressly
required by the terms of any of the Owner Trustee  Agreements,  (b) as expressly
provided  by  the  terms  hereof  or  (c)  as  expressly   provided  in  written
instructions from Owner Participant pursuant to Section 5.1 or 5.2.

          5.5 Satisfaction of Conditions Precedent

          Anything  in this Trust  Agreement  to the  contrary  notwithstanding,
Owner Trustee shall,  subject to the  satisfaction  of special counsel for Owner
Trustee of the occurrence of all the applicable  conditions  precedent specified
in Section 3.2, comply with the provisions of Section 3.1.


<PAGE>

          5.6 Fixed Investment Trust

          Notwithstanding  anything  in this Trust  Agreement  to the  contrary,
Owner  Trustee  shall not be  authorized  and  shall  have no power to "vary the
investment"  of Owner  Participant  within the meaning of  Treasury  Regulations
Section 301.7701-4(c)(1),  it being understood that Owner Trustee shall have the
power and authority to fulfill its obligations under Section 4.3 hereof, Section
4.3.3 of the Participation Agreement and Section 4.4 of the Lease.

          SECTION 6.  OWNER TRUSTEE

          6.1 Acceptance of Trusts and Duties

          First Security accepts the trusts hereby created and agrees to perform
the same as Owner Trustee but only upon the terms hereof and the Trust Indenture
applicable  to it. Owner  Trustee also agrees to receive and disburse all monies
received  by it  constituting  part of the Trust  Estate  pursuant  to the terms
hereof.  First  Security  shall  not be  answerable  or  accountable  under  any
circumstances,  except for (a) its own willful  misconduct  or gross  negligence
(including,  without  limitation,  in  connection  with any  activities of Owner
Trustee in  violation  of Section  5.4.2),  (b) its failure  (in its  individual
capacity)  to perform its  obligations  under  Section  5.4.1,  (c) its or Owner
Trustee's failure to use ordinary care to receive or disburse funds or to comply
with the first sentence of Section 6.8, (d) liabilities that may result from the
inaccuracy of any  representation  or breach of warranty of it in its individual
capacity  (or from the failure by it in its  individual  capacity to perform any
covenant)  in this  Trust  Agreement,  the  Trust  Indenture,  the  Lease or the
Participation  Agreement or elsewhere in any of the other Operative  Agreements,
(e)  taxes,  fees or  other  charges  on,  based  on or  measured  by any  fees,
commissions or  compensation  received by First Security in connection  with the
transactions  contemplated  by this  Trust  Agreement  and the  other  Operative
Agreements  to which it (in its  individual  capacity or as Owner  Trustee) is a
party,  (f) its or Owner Trustee's  failure to use ordinary care in receiving or
disbursing  funds or in connection  with its obligation to invest funds pursuant
to Section 4 of the Participation Agreement, Section 4.4 of the Lease or Section
4.3 hereof,  (g) any liability on the part of Owner  Trustee  arising out of its
negligence or willful or negligent misconduct in connection with its obligations
under Section 5.1 (other than the first sentence thereof),  6.8 or 9.2 hereof or
Section 4.01 of the Trust Indenture.  First Security shall have no obligation to
advance its  individual  funds for any purpose,  and Owner Trustee shall have no
obligation  to distribute  to Owner  Participant,  Lessee or any third party any
amounts to be paid to Owner  Trustee  until such amounts are  collected by Owner
Trustee.

          6.2 Absence of Certain Duties

          (a) Except in accordance with written instructions  furnished pursuant
to  Section  5.1 or 5.2 and except as  provided  in, and  without  limiting  the
generality  of,  Sections 3.1 and 5.4.1 and the last sentence of Section  9.1.2,
and subject to Section 4.01 of the Trust  Indenture,  neither  Owner Trustee nor
First  Security shall have any duty (i) to see to any recording or filing of any
Operative  Agreement  or of  any  supplement  to  any  thereof  or to see to the
maintenance  of any such recording or filing or any other filing of reports with


<PAGE>

the FAA or other governmental agencies,  except that of First Security to comply
with the FAA  reporting  requirements  set forth in 14 C.F.R.  ss.  47.45 and 14
C.F.R.  ss. 47.51,  and Owner Trustee shall, to the extent that  information for
that  purpose is timely  supplied  by Lessee  pursuant  to any of the  Operative
Agreements,  complete and timely  submit (and furnish Owner  Participant  with a
copy of) any and all reports relating to the Aircraft that may from time to time
be  required  by the FAA or any  government  or  governmental  authority  having
jurisdiction,  (ii) to see to any  insurance  on the  Aircraft  or to  effect or
maintain  any such  insurance,  whether or not Lessee  shall be in default  with
respect  thereto,  other  than to  forward  to Owner  Participant  copies of all
reports and other written  information  which Owner Trustee receives from Lessee
pursuant to Section 11 of the Lease,  (iii) except as provided in Section  7.3.1
or 7.3.2 of the Participation Agreement,  Section 4.01 of the Trust Indenture or
Section  5.4 or 6.1  hereof,  to see to the  payment  or  discharge  of any tax,
assessment or other  governmental  charge or any lien or encumbrance of any kind
owing  with  respect  to or  assessed  or levied  against  any part of the Trust
Indenture Estate or the Trust Estate, except as provided in Section 6.3.9 of the
Participation  Agreement  or (iv) to inspect  Lessee's  books and  records  with
respect to the Aircraft at any time permitted pursuant to the Lease.

          (b)  Notwithstanding   clause  (a),  Owner  Trustee  will  furnish  to
Mortgagee and Owner  Participant,  promptly upon receipt thereof,  duplicates or
copies of all  reports,  notices,  requests,  demands,  certificates,  financial
statements and other  instruments  furnished to Owner Trustee under the Lease or
any  other  Operative  Agreement  except to the  extent  to which a  responsible
officer of Owner Trustee  reasonably  believes  (and confirms by telephone  call
with Owner  Participant)  that  duplicates  or copies  thereof have already been
furnished to Owner Participant by some other person.

          6.3 No Representations or Warranties as to Certain Matters

          NEITHER  FIRST  SECURITY NOR OWNER TRUSTEE MAKES OR SHALL BE DEEMED TO
HAVE MADE (a) ANY  REPRESENTATION  OR  WARRANTY,  EXPRESS OR IMPLIED,  AS TO THE
TITLE, AIRWORTHINESS,  VALUE, CONDITION,  DESIGN, OPERATION,  MERCHANTABILITY OR
FITNESS FOR USE FOR A PARTICULAR PURPOSE OF THE AIRCRAFT OR ANY PART THEREOF, AS
TO THE ABSENCE OF LATENT OR OTHER DEFECTS,  WHETHER OR NOT  DISCOVERABLE,  AS TO
THE ABSENCE OF ANY  INFRINGEMENT  OF ANY PATENT,  TRADEMARK  OR  COPYRIGHT,  THE
ABSENCE  OF ANY  STRICT  LIABILITY  OBLIGATION  OR ANY OTHER  REPRESENTATION  OR
WARRANTY,  EXPRESS OR IMPLIED,  WITH RESPECT TO THE AIRCRAFT OR ANY PART THEREOF
WHATSOEVER, except that First Security warrants to Owner Participant that on the
Delivery Date Owner Trustee shall have received  whatever  title to the Aircraft
that was conveyed to it and that the Aircraft  shall,  on the Delivery  Date and
during the Term, be free of Lessor Liens  attributable  to First Security or (b)
any representation or warranty as to the validity, legality or enforceability of
this Trust Agreement or any other  Operative  Agreement to which First Security,
in its  individual  capacity  or as  Owner  Trustee,  is a party,  or any  other
document or instrument,  or as to the correctness of any statement  contained in
any  thereof  except to the extent that any such  statement  is  expressly  made
herein or therein by such party as a  representation  by First Security,  in its
individual  capacity  or as Owner  Trustee,  as the case may be, and except that
First Security  hereby  represents and warrants that it has all corporate  power
and authority to execute, deliver and perform this Trust Agreement and that this


<PAGE>

Trust  Agreement  has been,  and  (assuming  due  authorization,  execution  and
delivery  by Owner  Participant  of this Trust  Agreement)  the other  Operative
Agreements  to which it or Owner Trustee is a party have been (or at the time of
execution and delivery of any such  instrument by it or Owner Trustee under this
Trust  Agreement or pursuant to the terms of the  Participation  Agreement  that
such an  instrument  will be) duly executed and delivered by one of its officers
who is or will be, as the case may be,  duly  authorized  to execute and deliver
such  instruments on behalf of itself or Owner Trustee,  as the case may be, and
that this Trust Agreement constitutes the legal, valid and binding obligation of
First Security or Owner Trustee,  as the case may be, enforceable  against First
Security or Owner Trustee, as the case may be, in accordance with its terms.

          6.4 No Segregation of Monies; Interest

          Monies  received by Owner Trustee under this Trust  Agreement need not
be segregated  in any manner except to the extent  required by Law, or except as
provided in written  instructions from Owner Participant,  and shall be invested
as provided in Section 4.3 hereof or Section 4.4 of the Lease.

          6.5 Reliance upon Certificates, Counsel and Agents

          Owner  Trustee  shall incur no  liability  to anyone in acting in good
faith in reliance upon and in accordance with any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or other
document  or  paper  reasonably  believed  by it to be  genuine  and  reasonably
believed  by it to be  signed  by the  proper  party or  parties.  Unless  other
evidence in respect thereof is specifically  prescribed in this Trust Agreement,
any request, direction, order or demand of Owner Participant or Lessee mentioned
in this Trust Agreement or in any of the other Owner Trustee Agreements shall be
sufficiently  evidenced  by written  instruments  signed by the  Chairman of the
Board, the President, any Vice President or any other officer and in the name of
Owner Participant or Lessee, as the case may be. Owner Trustee may accept a copy
of a resolution  of the Board of  Directors  or  Executive  Committee of Lessee,
certified by the  Secretary or an Assistant  Secretary of Lessee as duly adopted
and in full force and effect,  as conclusive  evidence that such  resolution has
been duly adopted by said Board of Directors or Executive Committee and that the
same is in full  force  and  effect.  As to any fact or  matter  the  manner  of
ascertainment  of which is not  specifically  described in this Trust Agreement,
Owner  Trustee may,  absent Actual  Knowledge to the contrary,  for all purposes
rely on a certificate  signed by the Chairman of the Board,  the President,  any
Vice President or any other officer of Lessee, and the Treasurer or an Assistant
Treasurer or the Secretary or an Assistant  Secretary of Lessee, as to such fact
or matter,  and such  certificate  shall  constitute  full  protection  to Owner
Trustee  for any  action  taken or  omitted  to be taken by it in good  faith in
reliance thereon and in accordance  therewith.  In the  administration of trusts
under this Trust  Agreement,  Owner  Trustee  may  execute  any of the trusts or
powers and perform its powers and duties under this Trust Agreement  directly or
through agents or attorneys and may, at the expense of the Trust Estate, consult
with counsel,  accountants and other skilled persons to be selected and employed
by it. Owner Trustee shall not be liable for anything done,  suffered or omitted


<PAGE>

in good  faith  by it in  accordance  with the  advice  or  opinion  of any such
counsel, accountants or other skilled persons.

          6.6 Not Acting in Individual Capacity

          In acting under this Trust  Agreement,  First  Security acts solely as
Owner Trustee and not in its individual  capacity except as otherwise  expressly
provided in this Trust Agreement or in the other  Operative  Agreements to which
it is a party; and, except as may be otherwise  expressly provided in this Trust
Agreement,  the Lease, the Participation Agreement and the Trust Indenture,  all
persons, other than the Owner Participant as provided in this Trust Agreement or
the Trust  Indenture,  having any claim  against  Owner Trustee by reason of the
transactions contemplated hereby shall look only to the Trust Estate for payment
or  satisfaction  thereof  except  to the  extent  provided  in  Section  6.1 or
otherwise as Owner Trustee shall expressly agree otherwise in writing.

          6.7 Fees; Compensation

          Airframe  Manufacturer shall pay the Transaction  Expenses and ongoing
fees of  Owner  Trustee  throughout  the Term  pursuant  to  Section  9.2 of the
Participation  Agreement.  The Trust Estate shall not have any liability for any
such  fees and  expenses;  PROVIDED,  that the  foregoing  shall  not  limit the
obligations of Owner Participant under Sections 5.3 and 7; PROVIDED,  that Owner
Trustee  shall  have a Lien upon the Trust  Estate  for any such fee not paid by
Airframe  Manufacturer  as  contemplated  by  Section  9.2 of the  Participation
Agreement  and such Lien shall  entitle  Owner Trustee to priority as to payment
thereof over payment to any other Person under this Trust  Agreement;  PROVIDED,
that such Lien shall be subject and subordinate in all events to the Lien of the
Trust Indenture;  and PROVIDED,  FURTHER, that Owner Trustee shall have no right
to exercise,  and shall not exercise,  any rights or remedies  Owner Trustee may
have with  respect to such Lien  unless and until the Secured  Obligations  have
been paid and performed in full.

          6.8 Tax Returns

          Owner Trustee shall be responsible  for the keeping of all appropriate
books and records  relating to the receipt and  disbursement of all monies under
this Trust Agreement or any agreement  contemplated  hereby.  Owner  Participant
shall be responsible for causing to be prepared and filed all income tax returns
required to be filed by Owner  Participant.  Owner Trustee shall be  responsible
for causing to be prepared, at the expense of Airframe Manufacturer,  all income
tax returns  required to be filed with respect to the trust  created  hereby and
shall  execute and file such  returns;  PROVIDED,  that Owner Trustee shall send
promptly a  completed  copy of such  return to Owner  Participant  not more than
sixty nor less than fifteen days prior to the due date of the return,  PROVIDED,
that Owner  Trustee  shall have timely  received all  necessary  information  to
complete and deliver to Owner Participant such return.  Owner Participant,  upon
request,  will  furnish  Owner  Trustee  with  all  such  information  as may be
reasonably required from Owner Participant in connection with the preparation of
such  income  tax  returns.  Owner  Trustee  shall  keep  copies of all  returns
delivered to or filed by it.



<PAGE>

          SECTION 7.  INDEMNIFICATION OF FIRST SECURITY BY OWNER PARTICIPANT

          Owner   Participant   hereby  agrees,   whether  or  not  any  of  the
transactions contemplated hereby shall be consummated,  to assume liability for,
and hereby indemnifies,  protects,  saves and keeps harmless, First Security and
its  successors,  assigns,  agents and  servants,  from and  against any and all
liabilities, obligations, losses, damages, penalties, taxes (excluding any Taxes
which are not required to be  indemnified  by Lessee  pursuant to Section 9.1 or
9.3 of the  Participation  Agreement  and  excluding  any taxes payable by First
Security on or measured by any  compensation  received by First Security for its
services under this Trust Agreement), claims, actions, suits, costs, expenses or
disbursements  (including,   without  limitation,   reasonable  legal  fees  and
expenses,  but  excluding  internal  costs and  expenses  such as  salaries  and
overhead,  and including,  without  limitation,  any liability of an owner,  any
strict  liability  and any  liability  without  fault)  of any kind  and  nature
whatsoever  which may be imposed  on,  incurred  by or  asserted  against  First
Security  (whether or not also indemnified  against by Lessee under the Lease or
under the  Participation  Agreement  or also  indemnified  against  by any other
Person;  PROVIDED,  that Owner  Participant shall be subrogated to the rights of
Owner Trustee against Lessee or any other  indemnitor) in any way relating to or
arising out of this Trust Agreement or any of the other Operative  Agreements or
the enforcement of any of the terms of any thereof, or in any way relating to or
arising out of the manufacture, purchase, acceptance, nonacceptance,  rejection,
ownership, delivery, lease, possession, use, operation,  condition, sale, return
or other disposition of the Aircraft (including,  without limitation, latent and
other defects, whether or not discoverable,  and any claim for patent, trademark
or  copyright  infringement),  or in any way  relating  to or arising out of the
administration  of the Trust Estate or the action or inaction of Owner  Trustee,
under  this  Trust  Agreement,  except  (a) in the case of gross  negligence  or
willful misconduct on the part of First Security,  in its individual capacity or
as Owner Trustee,  in the performance or nonperformance of its duties under this
Trust Agreement or under any of the other Owner Trustee  Agreements or (b) those
Claims resulting from the inaccuracy of any  representation or warranty of First
Security (or from the failure of First Security to perform any of its covenants)
in Section  6.3,  in Section  6.03 of the Trust  Indenture,  in Section 4 of the
Lease, in Section 6.3 of the Participation  Agreement or elsewhere in any of the
other Operative  Agreements or (c) as may result from a breach by First Security
of its covenant in the last  sentence of Section 5.4.1 or (d) in the case of the
failure to use ordinary care on the part of First  Security,  in its  individual
capacity  or as Owner  Trustee,  in the receipt or  disbursement  of funds or in
connection  with its  obligation  to invest  funds  pursuant to Section 4 of the
Participation  Agreement,  Section  4.4 of the Lease or Section 4.3 hereof or in
compliance  with the  provisions of the first sentence of Section 6.8 or (e) any
liability on the part of Owner Trustee  arising out of its negligence or willful
or negligent  misconduct in connection with its  obligations  under Section 5.1,
6.8 or 9.2 hereof or Section  4.01 of the Trust  Indenture,  or (f) those claims
arising  under any  circumstances  or upon any terms where Lessee would not have
been required to indemnify First Security  pursuant to Section 9.1 or 9.3 of the
Participation  Agreement  (disregarding for purposes of this paragraph  Sections
9.1.2(b)  and  9.3.2(j));   PROVIDED,   that  before   asserting  its  right  to
indemnification,  if any, pursuant to this Section 7, First Security shall first
demand its corresponding  right to indemnification  pursuant to Section 9 of the
Participation  Agreement  (but need not  exhaust any or all  remedies  available
thereunder).  The  indemnities  contained  in this  Section  7  extend  to First
Security  only  in  its  individual  capacity  and  shall  not be  construed  as
indemnities  of the Trust  Indenture  Estate or the Trust Estate  (except to the


<PAGE>

extent,  if any, that First Security has been  reimbursed by the Trust Indenture
Estate or the Trust Estate for amounts covered by the  indemnities  contained in
this Section 7). The  indemnities  contained in this Section 7 shall survive the
termination of this Trust Agreement.  In addition, if necessary,  First Security
shall be entitled to indemnification from the Trust Estate,  subject to the Lien
of the Trust Indenture,  for any liability,  obligation,  loss, damage, penalty,
tax, claim,  action,  suit, cost,  expense or disbursement  indemnified  against
pursuant  to this  Section 7 to the  extent  not  reimbursed  by  Lessee,  Owner
Participant or others,  but without  releasing any of them from their respective
agreements of reimbursement; and, to secure the same First Security shall have a
lien on the Trust Estate, subject to the lien of the Trust Indenture and subject
further to the  provisions of Section 6.7,  which shall be prior to any interest
therein of Owner  Participant.  The payor of any indemnity  under this Section 7
shall be  subrogated  to any right of the person  indemnified  in respect of the
matter as to which such indemnity was paid.

          SECTION 8.  TRANSFER OF OWNER PARTICIPANT'S INTEREST

          8.1 Transfer of Interest

          All  provisions  of Section 10 of the  Participation  Agreement  shall
(with the same force and effect as if set forth in full in this  Section 8.1) be
applicable to any assignment,  conveyance or other transfer by Owner Participant
of any of its right,  title or interest in and to the  Participation  Agreement,
the Trust Estate or this Trust Agreement.

          SECTION 9.  SUCCESSOR OWNER TRUSTEES; CO-TRUSTEES

          9.1 Resignation of Owner Trustee; Appointment of Successor

               9.1.1 Resignation or Removal

          Owner  Trustee or any  successor  Owner  Trustee  (a) shall  resign if
required to do so pursuant to Section  13.3 of the  Participation  Agreement  or
upon  obtaining  Actual  Knowledge  of any facts  that would cast doubt upon its
continuing  status as a Citizen of the  United  States and (b) may resign at any
time  without  cause by giving at least 60 days' prior  written  notice to Owner
Participant,  Mortgagee and Lessee,  such  resignation  to be effective upon the
assumption of the trusts  hereunder by the successor Owner Trustee under Section
9.1.2. In addition, Owner Participant may at any time remove Owner Trustee, with
or without cause by a notice in writing  delivered to Owner  Trustee,  Mortgagee
and Lessee,  such  removal to be  effective  upon the  assumption  of the trusts
hereunder by the successor Owner Trustee under Section 9.1.2, PROVIDED, that, in
the case of a removal without cause,  unless a Lease Event of Default shall have
occurred  and be  continuing,  such  removal  shall be subject to the consent of
Lessee (which consent shall not be  unreasonably  withheld).  In the case of the
resignation  or  removal  of Owner  Trustee,  Owner  Participant  may  appoint a
successor  Owner Trustee by an  instrument  signed by Owner  Participant,  with,
unless a Lease  Event of Default  shall have  occurred  and be  continuing,  the
consent of Lessee  (which  consent  shall not be  unreasonably  withheld).  If a
successor Owner Trustee shall not have been appointed  within 30 days after such
notice of resignation or removal,  Owner Trustee, any Owner Participant,  Lessee


<PAGE>

or  Mortgagee  may apply to any court of  competent  jurisdiction  to  appoint a
successor  Owner  Trustee to act until such time,  if any, as a successor  shall
have been appointed as above provided.  Any successor Owner Trustee so appointed
by such court shall  immediately  and without  further act be  superseded by any
successor  Owner Trustee  appointed as above  provided  within one year from the
date of the appointment by such court.

               9.1.2 Execution and Delivery of Documents, Etc.

          Any successor  Owner  Trustee,  however  appointed,  shall execute and
deliver to the  predecessor  Owner  Trustee,  with a copy to Owner  Participant,
Lessee and Mortgagee,  an instrument accepting such appointment and assuming the
obligations of Owner Trustee,  in its individual  capacity and as Owner Trustee,
under the Owner Trustee Agreements,  and thereupon such successor Owner Trustee,
without  further  act,  shall become  vested with all the  estates,  properties,
rights, powers, duties and trusts of the predecessor Owner Trustee in the trusts
under this Trust Agreement with like effect as if originally named Owner Trustee
in this Trust  Agreement;  but  nevertheless,  upon the written  request of such
successor  Owner  Trustee,  such  predecessor  Owner  Trustee  shall execute and
deliver an instrument  transferring  to such successor  Owner Trustee,  upon the
trusts herein expressed, all the estates, properties,  rights, powers and trusts
of such predecessor Owner Trustee, and such predecessor Owner Trustee shall duly
assign,  transfer,  deliver  and pay over to such  successor  Owner  Trustee all
monies or other  property then held by such  predecessor  Owner Trustee upon the
trusts herein  expressed.  Upon the  appointment of any successor  Owner Trustee
under this  Section  9.1,  the  predecessor  Owner  Trustee  will  execute  such
documents as are provided to it by such  successor  Owner  Trustee and will take
such further  actions as are requested of it by such successor  Owner Trustee as
are required to cause  registration of the Aircraft included in the Trust Estate
to be transferred upon the records of the FAA, or other  governmental  authority
having jurisdiction, into the name of the successor Owner Trustee.

               9.1.3 Qualifications

          Any successor Owner Trustee, however appointed,  shall be a Citizen of
the United States and shall also be a bank or trust company  organized under the
Laws of the United  States or any state  thereof  having a combined  capital and
surplus of at least $100,000,000,  if there be such an institution willing, able
and legally  qualified to perform the duties of Owner  Trustee  under this Trust
Agreement upon  reasonable or customary  terms.  No such successor Owner Trustee
shall be located in a jurisdiction  which creates material adverse  consequences
for  Lessee  (unless  such  material  adverse  consequences  would be created by
substantially  all jurisdictions  where major banking or trust  institutions are
located).

               9.1.4 Merger, Etc.

          Any  corporation  into which First Security may be merged or converted
or with which it may be  consolidated,  or any  corporation  resulting  from any
merger, conversion or consolidation to which First Security shall be a party, or
any corporation to which substantially all the corporate trust business of First
Security may be  transferred,  shall,  subject to the terms of Section 9.1.3, be


<PAGE>

Owner Trustee under this Trust  Agreement  without further act,  PROVIDED,  that
such corporation shall not also be the Mortgagee.

          9.2 Co-Trustees and Separate Trustees

          (a) If at any  time it  shall  be  necessary  or  prudent  in order to
conform  to any Law of any  jurisdiction  in which  all or any part of the Trust
Estate is located,  or Owner Trustee  being  advised by counsel shall  determine
that it is so necessary or prudent in the interest of Owner Participant or Owner
Trustee,  or  Owner  Trustee  shall  have  been  directed  to  do  so  by  Owner
Participant,  Owner Trustee and Owner  Participant  shall execute and deliver an
agreement supplemental hereto and all other instruments and agreements necessary
or proper to  constitute  another  bank or trust  company or one or more persons
(any or all of which shall be a Citizen of the United States)  approved by Owner
Trustee and Owner Participant,  either to act as co-trustee,  jointly with Owner
Trustee,  or to act as separate  trustee  under this Trust  Agreement  (any such
co-trustee  or  separate  trustee  being  herein  sometimes  referred  to  as an
"additional  trustee").  In the event Owner Participant shall not have joined in
the execution of such agreements'  supplemental hereto within ten days after the
receipt of a written  request  from  Owner  Trustee so to do, or in case a Lease
Event of Default or Indenture  Event of Default  shall occur and be  continuing,
Owner Trustee may act under the foregoing provisions of this Section 9.2 without
the  concurrence of Owner  Participant;  and Owner  Participant  hereby appoints
Owner Trustee its agent and  attorney-in-fact  to act for it under the foregoing
provisions of this Section 9.2 in either of such contingencies.

          (b) Every additional  trustee under this Trust Agreement shall, to the
extent  permitted  by Law,  be  appointed  and act,  and Owner  Trustee  and its
successors shall act, subject to the following provisions and conditions:

          (i) All powers,  duties,  obligations and rights  conferred upon Owner
     Trustee in respect of the custody,  control and  management of monies,  the
     Aircraft or documents authorized to be delivered under this Trust Agreement
     or under the  Participation  Agreement  shall be exercised  solely by Owner
     Trustee;

          (ii) All other rights,  powers,  duties and  obligations  conferred or
     imposed upon Owner Trustee shall be conferred or imposed upon and exercised
     or performed by Owner Trustee and such additional  trustee jointly,  except
     to the  extent  that  under  any  Law  of any  jurisdiction  in  which  any
     particular act or acts are to be performed  (including the holding of title
     to the Trust Estate) Owner Trustee shall be  incompetent  or unqualified to
     perform such act or acts,  in which event such rights,  powers,  duties and
     obligations shall be exercised and performed by such additional trustee;

          (iii) No  power  given  to,  or which  it is  provided  hereby  may be
     exercised by, any such  additional  trustee  shall be exercised  under this
     Trust  Agreement by such additional  trustee,  except jointly with, or with
     the consent in writing of, Owner Trustee;

          (iv) No trustee under this Trust Agreement shall be personally  liable
     by reason of any action or omission of any other  trustee  under this Trust
     Agreement;


<PAGE>

          (v) Owner  Participant,  at any time,  by an instrument in writing may
     remove any such  additional  trustee.  In the event that Owner  Participant
     shall not have joined in the  execution of any such  instrument  within ten
     days after the receipt of a written  request  from Owner  Trustee so to do,
     Owner  Trustee shall have the power to remove any such  additional  trustee
     without the concurrence of Owner Participant;  and Owner Participant hereby
     appoints Owner Trustee its agent and attorney-in-fact to act for it in such
     connection in such contingency; and

          (vi) No  appointment  of, or action by, any  additional  trustee  will
     relieve Owner Trustee of any of its obligations  under, or otherwise affect
     any of the terms of,  the  Trust  Indenture  or  affect  the  interests  of
     Mortgagee or the Note Holders in the Trust Indenture Estate.

          (c) In case any  separate  trustee  under this  Section 9.2 shall die,
become incapable of acting,  resign or be removed, the title to the Trust Estate
and all rights and duties of such separate trustee shall, so far as permitted by
Law, vest in and be exercised by Owner  Trustee,  without the  appointment  of a
successor to such separate trustee.

          SECTION 10.  SUPPLEMENTS  AND AMENDMENTS TO TRUST  AGREEMENT AND OTHER
DOCUMENTS

          10.1 Supplements and Amendments and Delivery Thereof

               10.1.1 Supplements and Amendments

          Subject to Section 7.2.2 of the  Participation  Agreement,  this Trust
Agreement may not be amended,  supplemented  or otherwise  modified except by an
instrument in writing signed by Owner Trustee and Owner Participant.  Subject to
Section  10.2,  Section  9.01 of the Trust  Indenture  and Section  7.6.7 of the
Participation Agreement, Owner Trustee will execute any amendment, supplement or
other  modification  of this  Trust  Agreement  or of any  other  Owner  Trustee
Agreement  which it is  requested  in writing  to execute by Owner  Participant,
except that Owner  Trustee shall not execute any such  amendment,  supplement or
other  modification  which,  by the  express  provisions  of  any  of the  above
documents,  requires the consent of any other party  unless such  consent  shall
have been obtained;  and PROVIDED,  that,  without the prior written  consent of
Owner Participant,  (a) no such supplement,  amendment or modification shall (i)
modify any of the  provisions  of Section 4 or this Section  10.1,  (ii) reduce,
modify or amend any  indemnities  in favor of Owner  Participant as set forth in
Section 9 of the  Participation  Agreement  or in the Tax  Indemnity  Agreement,
(iii)  reduce  the  amount  or  extend  the  time  of  payment  of  Basic  Rent,
Supplemental  Rent,  Stipulated Loss Value or Termination  Value as set forth in
the Lease (except in accordance  with Section 3 of the Lease) or (iv) modify any
of the rights of Owner  Participant  under the Trust  Indenture  and (b) no such
supplement,  amendment or modification shall require Owner Participant to invest
or  advance  funds or shall  entail any  additional  personal  liability  or the
surrender of any indemnification, claim or individual right on the part of Owner
Participant with respect to any agreement or obligation.


<PAGE>

               10.1.2 Delivery of Amendments and Supplements to Certain Parties

          A signed copy of each  amendment or supplement  referred to in Section
10.1.1  to which  Lessee is not a party  shall be  delivered  promptly  by Owner
Trustee to Lessee, and a signed copy of each amendment or supplement referred to
in Section 10.1.1 shall be delivered promptly by Owner Trustee to Mortgagee.

          10.2 Discretion as to Execution of Documents

          Prior to executing any document required to be executed by it pursuant
to the terms of Section  10.1,  Owner  Trustee  shall be  entitled to receive an
opinion of its  counsel to the effect  that the  execution  of such  document is
authorized  under this Trust  Agreement.  If in the opinion of Owner Trustee any
such document adversely affects any right, duty,  immunity or indemnity in favor
of Owner  Trustee  under this Trust  Agreement or under any other Owner  Trustee
Agreement,  Owner Trustee may in its discretion decline to execute such document
unless Owner Trustee is furnished with  indemnification from Lessee or any other
party upon  terms and in amounts  reasonably  satisfactory  to Owner  Trustee to
protect the Trust Estate and the Owner Trustee against any and all  liabilities,
costs and expenses arising out of the execution of such documents.

          10.3 Absence of Requirements as to Form

          It shall not be necessary for any written request  furnished  pursuant
to Section 10.1 to specify the particular  form of the proposed  documents to be
executed  pursuant to such  Section  10.1,  but it shall be  sufficient  if such
request shall indicate the substance thereof.

          10.4 Distribution of Documents

          Promptly after the execution by Owner Trustee of any document  entered
into  pursuant to Section 10.1,  Owner  Trustee  shall mail, by certified  mail,
postage prepaid, a conformed copy thereof to Owner Participant,  but the failure
of Owner  Trustee  to mail such  conformed  copy  shall not impair or affect the
validity of such document.

          10.5 No  Request  Needed as to Lease  Supplement  and Trust  Indenture
Supplement

          No written  request  pursuant  to Section  10.1 shall be  required  to
enable Owner Trustee to enter into, pursuant to Section 3.1 and the Lease or the
Trust  Indenture,  as the case may be, the Lease  Supplement with Lessee and the
Trust Indenture Supplement.

          SECTION 11. MISCELLANEOUS

          11.1 Termination of Trust Agreement

          This Trust  Agreement  and the trusts  created  hereby  shall be of no
further force or effect upon the earlier of (a) both the final  discharge of the
Trust  Indenture  pursuant to Section  10.01 thereof and the sale or other final


<PAGE>

disposition  by Owner  Trustee of all  property  constituting  part of the Trust
Estate  and the  final  distribution  by Owner  Trustee  of all  monies or other
property or proceeds  constituting  part of the Trust Estate in accordance  with
Section 4, PROVIDED, that at such time Lessee shall have fully complied with all
of the terms of the Lease and the  Participation  Agreement or (b) 21 years less
one day after the death of the last  survivor of all of the  descendants  of the
grandparents  of  David  C.  Rockefeller  living  on the  date  of the  earliest
execution  of this  Trust  Agreement  by any  party  hereto,  but if this  Trust
Agreement  and the trusts  created  hereby shall be or become  authorized  under
applicable  Law to be valid for a period  commencing on the 21st  anniversary of
the death of such last  survivor  (or,  without  limiting the  generality of the
foregoing,  if legislation shall become effective  providing for the validity of
this  Trust  Agreement  and the  trusts  created  hereby  for a period  in gross
exceeding  the  period for which this  Trust  Agreement  and the trusts  created
hereby are hereinabove stated to extend and be valid), then this Trust Agreement
and the trusts  created  hereby  shall not  terminate  under this clause (b) but
shall  extend to and  continue in effect,  but only if such  nontermination  and
extension shall then be valid under applicable Law, until the day preceding such
date as the same shall, under applicable Law, cease to be valid;  otherwise this
Trust  Agreement and the trusts  created hereby shall continue in full force and
effect in  accordance  with the terms  hereof.  Except as expressly set forth in
Section  11.2,  this Trust  Agreement and the trusts  created  hereby may not be
revoked by Owner Participant.

          11.2 Termination at Option of the Owner Participant

          Notwithstanding  Section 11.1 hereof, this Agreement and trust created
hereby shall  terminate and the Trust Estate shall be  distributed  to the Owner
Participant,  and this Agreement  shall be of no further force and effect,  upon
the election of the Owner  Participant by notice to the Owner  Trustee,  if such
notice shall be  accompanied  by the written  agreement  (in form and  substance
satisfactory  to the  Owner  Trustee)  of the  Owner  Participant  assuming  all
obligations  of the  Owner  Trustee  under  or  contemplated  by  the  Operative
Agreements  or  incurred  by it as trustee  hereunder  and  releasing  the Owner
Trustee therefrom;  provided,  however, that such notice may be given only after
the time the Lien of the Trust  Indenture is  discharged  under Section 10.01 of
the Trust Indenture and after the Lease shall no longer be in effect.

          11.3 Owner Participant Has No Legal Title in Trust Estate

          Owner  Participant shall not have legal title to any part of the Trust
Estate. No transfer,  by operation of Law or otherwise,  of any right, title and
interest  of Owner  Participant  in and to the Trust  Estate  under  this  Trust
Agreement  shall operate to terminate  this Trust  Agreement or the trusts under
this  Trust  Agreement  or  entitle  any  successors  or  transferees  of  Owner
Participant  to an  accounting  or to the transfer of legal title to any part of
the Trust Estate.

          11.4 Assignment, Sale, etc. of Aircraft

          Any assignment,  sale, transfer or other conveyance of the Aircraft by
Owner Trustee made pursuant to the terms of this Trust Agreement or of the Lease
or the  Participation  Agreement  shall  bind  Owner  Participant  and  shall be
effective to transfer or convey all right,  title and interest of Owner  Trustee
and Owner  Participant  in and to the  Aircraft.  No purchaser or other  grantee


<PAGE>

shall be required to inquire as to the authorization,  necessity,  expediency or
regularity  of  such  assignment,  sale,  transfer  or  conveyance  or as to the
application of any sale or other proceeds with respect thereto by Owner Trustee.

          11.5 Trust Agreement for Benefit of Certain Parties Only

          Except  for the terms of  Section  10 of the  Participation  Agreement
incorporated in Section 8 and except as otherwise provided in Sections 5.1, 6.7,
9, 10.1 and 11.1,  nothing in this Trust Agreement,  whether express or implied,
shall be  construed  to give any  person  other  than  Owner  Trustee  and Owner
Participant any legal or equitable right, remedy or claim under or in respect of
this Trust Agreement;  and this Trust Agreement shall be held to be for the sole
and exclusive benefit of Owner Trustee and Owner Participant.

          11.6 Citizenship of Owner Participant

          Reserved.

          11.7 Notices

          Unless  otherwise  expressly  permitted  by the  terms  of this  Trust
Agreement, all notices, requests, demands, authorizations, directions, consents,
waivers  and other  communications  required  or  permitted  to be made,  given,
furnished or filed under this Trust Agreement  shall be in writing,  shall refer
specifically to this Trust Agreement and shall be personally delivered,  sent by
telecopy,  telex or other means of  electronic  facsimile  or  telecommunication
transmission,  sent  by  registered  mail  or  certified  mail,  return  receipt
requested,  postage prepaid,  or sent by overnight courier service, in each case
to the respective telex,  telecopy or other number or address set forth for such
party in  Schedule 1 to the  Participation  Agreement,  or to such other  telex,
telecopy or other number or address as each party hereto may  hereafter  specify
by notice to the other  parties  hereto.  Each  such  notice,  request,  demand,
authorization,  direction,  consent,  waiver  or  other  communication  shall be
effective when received or, if made,  given,  furnished or filed (a) by telecopy
or other means of electronic facsimile or telecommunication  transmission,  when
confirmed,  or (b) by registered or certified  mail,  three  Business Days after
being deposited, properly addressed, in the U.S. mail.

          11.8 Severability

          If any  provision  of this  Trust  Agreement  shall  be held  invalid,
illegal or unenforceable in any respect in any jurisdiction, then, to the extent
permitted by Law, (a) all other provisions hereof shall remain in full force and
effect  in  such   jurisdiction   and  (b)  such   invalidity,   illegality   or
unenforceability  shall not affect the validity,  legality or  enforceability of
such provision in any other jurisdiction. If, however, any Law pursuant to which
such provisions are held invalid,  illegal or unenforceable may be waived,  such
Law is hereby waived by the parties hereto to the full extent permitted,  to the
end  that  this  Trust  Agreement  shall be  deemed  to be a valid  and  binding
agreement in all respects, enforceable in accordance with its terms.


<PAGE>

          11.9 Waivers, Etc.

          No term or  provision  hereof may be changed,  waived,  discharged  or
terminated  orally,  but  only  by an  instrument  in  writing  entered  into in
compliance  with the terms of Section  10;  and any  waiver of the terms  hereof
shall be effective  only in the specific  instance and for the specific  purpose
given.

          11.10 Counterparts

          This  Trust  Agreement  and  any  amendments,   waivers,  consents  or
supplements hereto may be executed in any number of counterparts,  each of which
when  so  executed  shall  be  deemed  to be  an  original,  and  all  of  which
counterparts, taken together, shall constitute one and the same instrument.

          11.11 Binding Effect, Etc.

          All covenants and agreements  contained in this Trust  Agreement shall
be binding upon,  and inure to the benefit of, Owner Trustee and its  successors
and  assigns,  and Owner  Participant  and its  successors  and,  to the  extent
permitted by Section 8, assigns. Any request, notice, direction, consent, waiver
or other instrument or action by Owner Participant shall bind its successors and
assigns.

          11.12 Headings; References

          The  headings and the table of contents  used in this Trust  Agreement
are for  convenience  of reference only and shall not define or limit any of the
terms or provisions  hereof and shall not in any way affect the construction of,
or be taken into consideration in interpreting, this Trust Agreement.

          11.13 Governing Law

          THIS TRUST  AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY THE LAWS OF
THE  STATE  OF  UTAH,  INCLUDING  ALL  MATTERS  OF  CONSTRUCTION,  VALIDITY  AND
PERFORMANCE, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS.

                     [This space intentionally left blank.]


<PAGE>

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

                                        ICX CORPORATION



                                        By______________________________________
                                          Name:
                                          Title:


                                        FIRST SECURITY BANK, NATIONAL
                                          ASSOCIATION



                                        By______________________________________
                                          Name:
                                          Title:





                              TRUST AGREEMENT ____

                         Dated as of September 25, 1997


                                     Between


                           METLIFE CAPITAL CREDIT L.P.


                                       and


                    FIRST SECURITY BANK, NATIONAL ASSOCIATION




                       One Embraer Model EMB-145 Aircraft
                    Bearing Manufacturer's Serial No. 145.___
                        and U.S. Registration No. N_____
                     with Two Allison Model AE3007A Engines
                          Bearing Engine Manufacturer's
                       Serial Nos. _________ and _________


<PAGE>


<TABLE>
<CAPTION>
                               TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

<S>           <C>                                                            <C>
Section 1.    Definitions..............................................        1

Section 2.    Declaration Of Trust.....................................        1

Section 3.    Authorization; Conditions Precedent......................        1
       3.1    Authorization............................................        1
       3.2    Conditions Precedent.....................................        2
       3.3    Limitations on Control...................................        3

Section 4.    Receipt, Distribution And Application Of Income From
              The Trust Estate.........................................        4
       4.1    Payments from Trust Estate Only..........................        4
       4.2    Distribution of Payments.................................        4
              4.2.1    Payments to Mortgagee...........................        4
              4.2.2    Payments to Owner Trustee, Other Parties........        4
              4.2.3    Certain Distributions to Owner Participant......        5
              4.2.4    Excluded Payments...............................        5
       4.3    Method of Payments.......................................        5

Section 5.    Duties Of Owner Trustee..................................        5
       5.1    Notice of Event of Default...............................        5
       5.2    Action upon Instructions.................................        6
       5.3    Limitations on Duties....................................        6
       5.4    No Duties except as Specified; No Action except
              as Specified.............................................        7
              5.4.1    No Duties except as Specified...................        7
              5.4.2    No Action except as Specified...................        7
       5.5    Satisfaction of Conditions Precedent.....................        7
       5.6    Fixed Investment Trust...................................        7

Section 6.    Owner Trustee............................................
        7
       6.1    Acceptance of Trusts and Duties..........................        7
       6.2    Absence of Certain Duties................................        8
       6.3    No Representations or Warranties as to Certain Matters...        9
       6.4    No Segregation of Monies; Interest.......................        9
       6.5    Reliance upon Certificates, Counsel and Agents...........        9
       6.6    Not Acting in Individual Capacity........................       10
       6.7    Fees; Compensation.......................................       10
       6.8    Tax Returns..............................................       11

Section 7.    Indemnification Of First Security By Owner Participant...       11


<PAGE>

                                TABLE OF CONTENTS
                                   (Continued)
                                                                            PAGE
                                                                            ----
Section 8.    Transfer Of Owner Participant's Interest..................      12
       8.1    Transfer of Interest......................................      12

Section 9.    Successor Owner Trustees; Co-Trustees.....................      12
       9.1    Resignation of Owner Trustee; Appointment of Successor....      12
              9.1.1    Resignation or Removal...........................      12
              9.1.2    Execution and Delivery of Documents, Etc.........      13
              9.1.3    Qualifications...................................      14
              9.1.4    Merger, Etc......................................      14
       9.2    Co-Trustees and Separate Trustees.........................      14

Section 10.   Supplements And Amendments To Trust Agreement And Other
              Documents................................................       15
       10.1   Supplements and Amendments and Delivery Thereof..........       15
              10.1.1   Supplements and Amendments......................       15
              10.1.2   Delivery of Amendments and Supplements to
                       Certain Parties.................................       16
       10.2   Discretion as to Execution of Documents..................       16
       10.3   Absence of Requirements as to Form.......................       16
       10.4   Distribution of Documents................................       18
       10.5   No Request Needed as to Lease Supplement and Trust
              Indenture Supplement.....................................       17

Section 11.   Miscellaneous............................................       17
       11.1   Termination of Trust Agreement...........................       17
       11.2   Termination at Option of the Owner Participant...........       17
       11.3   Owner Participant Has No Legal Title in Trust Estate.....       18
       11.4   Assignment, Sale, etc. of Aircraft.......................       18
       11.5   Trust Agreement for Benefit of Certain Parties Only......       18
       11.6   Citizenship of Owner Participant.........................       18
       11.7   Notices..................................................       18
       11.8   Severability.............................................       18
       11.9   Waivers, Etc.............................................       19
       11.10  Counterparts.............................................       19
       11.11  Binding Effect, Etc......................................       19
       11.12  Headings; References.....................................       19
       11.13  Governing Law............................................       19

</TABLE>



<PAGE>


                              TRUST AGREEMENT ____

          This TRUST  AGREEMENT  ____,  dated as of September 25, 1997,  between
METLIFE   CAPITAL   CREDIT  L.P.,  a  Delaware   limited   partnership   ("Owner
Participant"), and FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking
association (in its individual  capacity,  "First Security" and otherwise not in
its individual capacity but solely as trustee hereunder, "Owner Trustee").

                              W I T N E S S E T H:
                              - - - - - - - - - - 

          Section 1. DEFINITIONS.  Capitalized terms used but not defined herein
shall have the respective  meanings set forth or incorporated by reference,  and
shall be construed and  interpreted in the manner  described,  in Annex A to the
Lease.

          Section 2.  DECLARATION OF TRUST.  First Security hereby declares that
it will hold the Trust Estate as Owner Trustee upon the trusts  hereinafter  set
forth for the use and benefit of Owner  Participant,  subject,  however,  to the
provisions of and the Lien created by the Trust  Indenture and to the provisions
of the Lease and the Participation Agreement.

          Section 3. Authorization; Conditions Precedent

          3.1  AUTHORIZATION.  In respect  of the  Aircraft,  Owner  Participant
hereby authorizes and directs Owner Trustee to, and Owner Trustee agrees for the
benefit  of Owner  Participant  that it will,  on and after the  Delivery  Date,
subject (except with respect to Section 3.1(a)) to due compliance with the terms
of Section 3.2:

          (a)  execute  and  deliver  the  Participation  Agreement,  the  Trust
     Indenture,  the  Lease  and the  other  Owner  Trustee  Agreements  (in the
     respective  forms in which  they are  delivered  from time to time by Owner
     Participant to Owner Trustee);

          (b)  subject to the terms of this Trust  Agreement,  exercise  (i) its
     rights and perform its duties under the Participation  Agreement,  (ii) the
     rights  and  perform  the  duties of  Lessor  under the Lease and (iii) its
     rights and perform its duties under the Trust Indenture and the other Owner
     Trustee Agreements;

          (c) execute,  issue and deliver to Mortgagee  for  authentication  and
     further  delivery to the  Subordination  Agent the  Equipment  Notes in the
     amount and as provided in Section 2 of the Participation Agreement;

          (d) purchase the Aircraft pursuant to the Participation Agreement;

          (e) accept from  Existing  Lessor the delivery of the Aircraft Bill of
     Sale, the FAA Bill of Sale and the invoice with respect to such Aircraft;

          (f) effect the  registration  of the Aircraft with the FAA in the name
     of Owner Trustee by filing or causing to be filed with the FAA: (i) the FAA
     Bill of Sale;  (ii) an  Aircraft  Registration  Application  in the name of
     Owner  Trustee  (including,  without  limitation,  an affidavit  from Owner



<PAGE>


     Trustee in compliance with the provisions of Section  47.7(c)(2) of the FAA
     Regulations); and (iii) this Trust Agreement;

          (g)  execute  and  deliver  the  Financing  Statements  referred to in
     Section  5.1.2 (xxiv) of the  Participation  Agreement,  together  with all
     other agreements, documents and instruments referred to in Section 5 of the
     Participation Agreement to which Owner Trustee is to be a party;

          (h) make payment of Lessor's  Cost for the Aircraft from the aggregate
     amount of the  Commitments  for the Aircraft of Owner  Participant and Loan
     Participant,  to the  extent  received  by  Owner  Trustee,  in the  manner
     provided in the Participation Agreement;

          (i) execute and deliver Lease Supplement No. 1 covering the Aircraft;

          (j) execute  and deliver a Trust  Indenture  Supplement  covering  the
     Aircraft; and

          (k)  execute  and deliver  all such other  instruments,  documents  or
     certificates  and  take all  such  other  actions  in  accordance  with the
     direction of Owner Participant,  as Owner Participant may deem necessary or
     advisable in connection  with the  transactions  contemplated by this Trust
     Agreement and the other Operative Agreements.

          3.2 CONDITIONS PRECEDENT.  The rights and obligations of Owner Trustee
to take the actions  required  by Section 3.1 shall be subject to the  following
conditions precedent:

          (a) Owner Trustee shall have received the notice  described in Section
     5.1.1 of the  Participation  Agreement,  when and as required  thereby,  or
     shall  have been  deemed to have  waived  such  notice in  accordance  with
     Section 5.1.1 of the Participation Agreement;

          (b) Each Participant shall have made the full amount of its Commitment
     specified in Section 2.1 of the Participation  Agreement available to Owner
     Trustee, in immediately  available funds, in accordance with Sections 2 and
     4 of the Participation Agreement; and

          (c) Owner Participant shall have notified Owner Trustee that the terms
     and conditions of Section 5 of the Participation Agreement, insofar as they
     relate to conditions  precedent to performance by Owner  Participant of its
     obligations thereunder,  have been either fulfilled to the satisfaction of,
     or waived by, Owner  Participant.  Owner Participant  shall, by instructing
     Owner  Trustee to release  the full amount of its  Commitment  then held by
     Owner Trustee as provided in Section 2 of the Participation  Agreement,  be
     deemed to have found  satisfactory  to it, or waived,  all such  conditions
     precedent.


<PAGE>


          3.3 LIMITATIONS ON CONTROL.

          (a) Notwithstanding  any other provision of this Trust Agreement,  but
     subject to paragraph  (b) of this Section 3.3, the Owner  Participant  will
     have no rights or powers to direct,  influence or control the Owner Trustee
     in the performance of the Owner Trustee's duties under this Trust Agreement
     in  connection  with matters  involving  the ownership and operation of the
     Aircraft by the Owner Trustee.  In all matters  involving the ownership and
     operation of the Aircraft by the Owner  Trustee,  the Owner  Trustee  shall
     have absolute and complete discretion in connection  therewith and shall be
     free  of  any  kind  of  influence  or  control  whatsoever  by  the  Owner
     Participant,  and the Owner  Trustee  shall  exercise its duties under this
     Trust  Agreement in  connection  with matters  involving  the ownership and
     operation  of the Aircraft by the Owner  Trustee as it, in its  discretion,
     shall  deem  necessary  to protect  the  interests  of the  United  States,
     notwithstanding any countervailing  interest of any foreign power which, or
     whose  citizens  may  have a  direct  or  indirect  interest  in the  Owner
     Participant  and  any  such  action  by  the  Owner  Trustee  shall  not be
     considered  malfeasance  or in  breach  of any  obligation  which the Owner
     Trustee might otherwise have to the Owner Participant;  PROVIDED,  HOWEVER,
     that subject to the foregoing limitations, the Owner Trustee shall exercise
     its discretion in all matters  involving the ownership and operation of the
     Aircraft  by the Owner  Trustee  with due regard for the  interests  of the
     Owner  Participant.  In exercising  any of its rights and duties under this
     Trust  Agreement in connection with matters which may arise not relating to
     the ownership  and  operation of the  Aircraft,  the Owner Trustee shall be
     permitted to seek the advice of the Owner  Participant  before  taking,  or
     refraining from taking, any action with respect thereto.  The Owner Trustee
     shall  notify the Owner  Participant  of its  exercise of rights and duties
     under this  Trust  Agreement  in  connection  with  matters  involving  the
     ownership and operation of the Aircraft by the Owner Trustee.

          (b) Subject to the  requirements  of the preceding  paragraph (a), the
     Owner Trustee agrees that it will not, without the prior written consent of
     the Owner Participant,  (i) sell, mortgage,  pledge or otherwise dispose of
     the  Aircraft or other  assets held in the Trust  Estate  relating  thereto
     except as otherwise expressly provided for herein, or (ii) amend the Lease,
     any Permitted  Sublease or other Operative  Agreements or give any consents
     thereunder.

          (c) The purpose of this  Section 3.3 is to give the Owner  Trustee the
     power to manage and control the Aircraft with respect to matters  involving
     the  ownership  and  operation of the Aircraft by the Owner  Trustee in the
     event that the Owner Trustee becomes the owner of the Aircraft or is deemed
     to be the owner of the  Aircraft  pursuant  to Law so as to assure that (i)
     the Aircraft shall be controlled  with respect to such matters by a Citizen
     of the United  States,  (ii) the Owner  Participant  shall have no power to
     influence or control the  exercise of the Owner  Trustee's  authority  with
     respect to such matters and (iii) the Owner  Trustee  shall be able to give
     the affidavit  required by Section  47.7(c)(2)(iii) of the Federal Aviation
     Regulations, 14 C.F.R. 47.7(c)(2)(iii). This Section 3.3 shall be construed
     in furtherance of the foregoing purpose.


<PAGE>


          Section 4. Receipt,  Distribution  And  Application Of Income From The
Trust Estate

          4.1 PAYMENTS FROM TRUST ESTATE ONLY.  Except as provided in Section 7,
all payments to be made by Owner  Trustee  under this Trust  Agreement  shall be
made  only  from (a) in the case of funds  made  available  in  accordance  with
Section 4 of the Participation  Agreement,  the Commitments (except as otherwise
provided in Section 14 of the  Participation  Agreement)  and (b) in the case of
all other  payments,  the income from and  proceeds  of the Trust  Estate to the
extent that Owner Trustee shall have received sufficient income or proceeds from
the Trust Estate to make such payments.  Owner  Participant  agrees that it will
look solely (y) in the case of funds made available in accordance with Section 4
of the  Participation  Agreement,  to the Commitments  and any income  therefrom
(except as otherwise provided in Section 14 of the Participation  Agreement) and
(z) in the case of all other  payments,  to the income from and  proceeds of the
Trust Estate to the extent  available for  distribution to Owner  Participant as
provided  in this  Trust  Agreement.  Except as  provided  in  Section  7, Owner
Participant  agrees that First  Security is neither  personally  liable to Owner
Participant  for any amounts  payable nor subject to any other  liability  under
this Trust Agreement.



<PAGE>


          4.2  Distribution of Payments.

               4.2.1 PAYMENTS TO MORTGAGEE. Until the Trust Indenture shall have
     been  discharged  pursuant to Section 10.01  thereof,  all Rent,  insurance
     proceeds  and  requisition  or other  payments of any kind  included in the
     Trust Estate (other than Excluded  Payments) payable to Owner Trustee shall
     be payable  directly to Mortgagee  (and, if any of the same are received by
     Owner  Trustee,  shall  upon  receipt  be paid  over to  Mortgagee  without
     deduction,   set-off  or  adjustment  of  any  kind)  for  distribution  in
     accordance  with the  provisions  of  Article  III of the Trust  Indenture;
     PROVIDED,  that any  payments  received by Owner  Trustee from (a) Airframe
     Manufacturer  with respect to Owner Trustee's fees and disbursements or (b)
     Owner Participant pursuant to Section 7 shall not be paid over to Mortgagee
     but shall be retained by Owner  Trustee and applied  toward the purpose for
     which such payments were made.

               4.2.2 PAYMENTS TO OWNER TRUSTEE,  OTHER PARTIES.  After the Trust
     Indenture shall have been discharged pursuant to Section 10.01 thereof, any
     payment of the type  referred  to in Section  4.2.1  (other  than  Excluded
     Payments)  received by Owner Trustee,  any payment  received from Mortgagee
     (other than Excluded Payments) and any other amount received as part of the
     Trust Estate and for the  application or distribution of which no provision
     is made in this Trust Agreement shall be distributed forthwith upon receipt
     by Owner Trustee in the following order of priority: FIRST, so much of such
     payment as shall be required to  reimburse  Owner  Trustee for any expenses
     not  otherwise  reimbursed  as to which Owner  Trustee is entitled to be so
     reimbursed  pursuant to the  provisions  hereof  shall be retained by Owner
     Trustee;  SECOND,  the amount set forth in Schedule 1 hereto,  if any, on a
     Payment  Date  shall be paid to Owner  Participant;  THIRD,  the amount set
     forth in Schedule 2 hereto shall be paid to Equity  Guarantor;  and FOURTH,
     the balance, if any, shall be paid to Owner Participant.



<PAGE>


               4.2.3 CERTAIN  DISTRIBUTIONS  TO OWNER  PARTICIPANT.  All amounts
     from time to time distributable by Mortgagee to Owner Participant  pursuant
     to the Trust Indenture  shall, if paid to Owner Trustee,  be distributed by
     Owner Trustee to Owner  Participant  in accordance  with the  provisions of
     Article III of the Trust Indenture; PROVIDED, that any payments received by
     Owner  Trustee  from (a) Lessee with  respect to Owner  Trustee's  fees and
     disbursements or (b) Owner  Participant  pursuant to Section 7 shall not be
     paid over to Owner  Participant  but shall be retained by Owner Trustee and
     applied toward the purpose for which such payments were made.

               4.2.4 EXCLUDED PAYMENTS.  Any Excluded Payments received by Owner
     Trustee  shall be paid by Owner Trustee to the Person to whom such Excluded
     Payments are payable under the provisions of the  Participation  Agreement,
     the Tax Indemnity Agreement or the Lease.

          4.3 METHOD OF PAYMENTS.  Owner  Trustee  shall make  distributions  or
cause  distributions to be made to Owner Participant  pursuant to this Section 4
by  transferring  the amount to be  distributed  by wire transfer in immediately
available funds on the day received (or on the next  succeeding  Business Day if
the funds to be so distributed  shall not have been received by Owner Trustee by
12:00 noon,  New York City time,  and which funds Owner  Trustee  shall not have
been reasonably able to distribute to Owner  Participant on the day received) to
Owner  Participant's  account  set  forth  in  Schedule  1 to the  Participation
Agreement  or to such other  account or accounts of Owner  Participant  as Owner
Participant  may  designate  from  time to time in  writing  to  Owner  Trustee;
PROVIDED,  that Owner Trustee shall use reasonable  efforts to invest overnight,
in investments that would be permitted under Section 4.4 of the Lease, all funds
received by it at or later than 12:00 noon,  New York City time, and which funds
Owner  Trustee  shall  not have  been  reasonably  able to  distribute  to Owner
Participant on the day received).

          Section 5.Duties Of Owner Trustee.

          5.1 NOTICE OF EVENT OF DEFAULT

          (a) If Owner  Trustee  shall have  knowledge  of a Lease  Default or a
     Lease Event of Default or an  Indenture  Default or an  Indenture  Event of
     Default, Owner Trustee shall give to Owner Participant,  Mortgagee,  Lessee
     and Equity Guarantor prompt  telephonic or telex notice thereof followed by
     prompt confirmation  thereof by certified mail, postage prepaid,  PROVIDED,
     that (i) in the case of an event  which  with  the  passage  of time  would
     constitute  an  Indenture  Event  of  Default  of the type  referred  to in
     paragraph  (c) or (e) of Section 4.02 of the Trust  Indenture,  such notice
     shall in no event be  furnished  later  than ten days after  Owner  Trustee
     shall  first  have  knowledge  of such  event  and  (ii)  in the  case of a
     misrepresentation  by Owner  Trustee  which with the  passage of time would
     constitute  an  Indenture  Event  of  Default  of the type  referred  to in
     paragraph (d) of Section 4.02 of the Trust Indenture,  such notice shall in
     no event be furnished  later than ten days after Owner  Trustee shall first
     have knowledge of such event.

          (b) Subject to the terms of Section 5.3, Owner Trustee shall take such
     action or shall refrain from taking such action,  not inconsistent with the
  

<PAGE>


     provisions  of the Trust  Indenture,  with  respect to such Lease  Default,
     Lease Event of Default,  Indenture Default or Indenture Event of Default or
     other  event as  Owner  Trustee  shall  be  directed  in  writing  by Owner
     Participant.  For all purposes of this Trust  Agreement,  the Lease and the
     other  Operative  Agreements,  in the absence of Actual  Knowledge of Owner
     Trustee,  Owner  Trustee  shall not be deemed to have  knowledge of a Lease
     Default,  Lease Event of Default,  Indenture  Default or Indenture Event of
     Default  unless  notified in writing by  Mortgagee,  Owner  Participant  or
     Lessee.

          5.2 ACTION UPON INSTRUCTIONS. Subject to the terms of Sections 5.1 and
5.3,  upon the written  instructions  at any time and from time to time of Owner
Participant,  Owner  Trustee  will  take  such  of the  following  actions,  not
inconsistent with the provisions of the Lease and the Trust Indenture, as may be
specified  in such  instructions:  (a) give such notice or direction or exercise
such right, remedy or power under this Trust Agreement or any of the other Owner
Trustee Agreements or in respect of all or any part of the Trust Estate, or take
such  other  action,  as  shall be  specified  in such  instructions  (including
entering  into such  agreements  and  instruments  as shall be  necessary  under
Section  10);  (b) take such  action to  preserve  or protect  the Trust  Estate
(including the discharge of Liens) as may be specified in such instructions; (c)
approve as satisfactory to it all matters  required by the terms of the Lease or
the other Operative  Agreements to be  satisfactory  to Owner Trustee,  it being
understood that without written instructions of Owner Participant, Owner Trustee
shall not  approve  any such  matter as  satisfactory  to it; (d) subject to the
rights of Lessee under the Operative Agreements, after the expiration or earlier
termination  of the  Lease,  convey  all of Owner  Trustee's  right,  title  and
interest  in and to the  Aircraft  for such  amount,  on such  terms and to such
purchaser or purchasers as shall be designated in such instructions,  or retain,
lease or otherwise  dispose of, or from time to time take such other action with
respect  to,  the  Aircraft  on  such  terms  as  shall  be  designated  in such
instructions;  and (e) take or refrain  from taking such other action or actions
as may be specified in such instructions.

          5.3 LIMITATIONS ON DUTIES. Owner Trustee shall not be required to take
any action under  Section 5.1 (other than the giving of the notices  referred to
therein) or 5.2 if Owner  Trustee  shall  reasonably  believe such action is not
adequately  indemnified by Owner  Participant  under Section 7, unless Lessee or
Owner  Participant  agrees  to  furnish  such  additional   indemnity  as  shall
reasonably be required,  in manner and form satisfactory to Owner Trustee,  and,
in addition to the extent not otherwise  paid pursuant to the  provisions of the
Lease or of the Participation  Agreement,  to pay the reasonable compensation of
Owner  Trustee for the  services  performed or to be performed by it pursuant to
such direction and any reasonable  fees and  disbursements  of counsel or agents
employed by Owner  Trustee in connection  therewith.  Owner Trustee shall not be
required to take any action  under  Section 5.1 or 5.2 (other than the giving of
the notices  referred to therein) if Owner  Trustee  shall have been  advised by
counsel  that such action is  contrary to the terms of any of the Owner  Trustee
Agreements  or is otherwise  contrary to Law and Owner  Trustee has delivered to
Owner Participant written notice of the basis for its refusal to act.


<PAGE>


          5.4 No Duties except as Specified; No Action except as Specified.

               5.4.1 NO DUTIES EXCEPT AS SPECIFIED. Owner Trustee shall not have
     any duty or  obligation  to  manage,  control,  use,  sell,  dispose  of or
     otherwise  deal with the  Aircraft or any other part of the Trust Estate or
     to otherwise take or refrain from taking any action under, or in connection
     with, any of the Owner Trustee Agreements,  except as expressly required by
     the terms of any of the Owner  Trustee  Agreements,  or (to the  extent not
     inconsistent  with the  provisions  of the Trust  Indenture)  as  expressly
     provided  by the  terms  hereof  or in a  written  instruction  from  Owner
     Participant  received  pursuant to the terms of Section 5.1 or 5.2,  and no
     implied  duties or  obligations  shall be read into  this  Trust  Agreement
     against  Owner  Trustee.  First  Security  agrees  that  it  will,  in  its
     individual  capacity  and at its own cost or expense (but without any right
     of indemnity in respect of any such cost or expense  hereunder or under the
     Participation Agreement),  promptly take such action as may be necessary to
     duly discharge and satisfy in full all Lessor Liens  attributable  to it in
     its  individual  capacity  which it is  required to  discharge  pursuant to
     Section 7.3.1 of the Participation  Agreement and otherwise comply with the
     terms of said Section binding upon it.

               5.4.2 NO ACTION EXCEPT AS SPECIFIED.  Owner Trustee shall have no
     power, right or authority to, and agrees that it will not, manage, control,
     use, sell, dispose of or otherwise deal with the Aircraft or any other part
     of the Trust Estate except (a) as expressly required by the terms of any of
     the Owner Trustee Agreements, (b) as expressly provided by the terms hereof
     or (c) as expressly provided in written instructions from Owner Participant
     pursuant to Section 5.1 or 5.2.

          5.5  SATISFACTION  OF  CONDITIONS  PRECEDENT.  Anything  in this Trust
Agreement to the contrary  notwithstanding,  Owner Trustee shall, subject to the
satisfaction  of special  counsel for Owner Trustee of the occurrence of all the
applicable  conditions  precedent  specified  in Section  3.2,  comply  with the
provisions of Section 3.1.

          5.6 FIXED  INVESTMENT  TRUST.  Notwithstanding  anything in this Trust
Agreement to the contrary,  Owner Trustee shall not be authorized and shall have
no power to "vary the  investment"  of Owner  Participant  within the meaning of
Treasury  Regulations Section  301.7701-4(c)(1),  it being understood that Owner
Trustee  shall have the power and  authority  to fulfill its  obligations  under
Section 4.3 hereof, Section 4.3.3 of the Participation Agreement and Section 4.4
of the Lease.

          Section 6.  Owner Trustee.

          6.1 ACCEPTANCE OF TRUSTS AND DUTIES. First Security accepts the trusts
hereby created and agrees to perform the same as Owner Trustee but only upon the
terms hereof and the Trust Indenture applicable to it. Owner Trustee also agrees
to receive and disburse all monies received by it constituting part of the Trust
Estate  pursuant to the terms hereof.  First Security shall not be answerable or
accountable under any  circumstances,  except for (a) its own willful misconduct
or gross  negligence  (including,  without  limitation,  in connection  with any
activities of Owner Trustee in violation of Section 5.4.2),  (b) its failure (in
its individual capacity) to perform its obligations under Section 5.4.1, (c) its


<PAGE>


or Owner Trustee's  failure to use ordinary care to receive or disburse funds or
to comply  with the first  sentence of Section  6.8,  (d)  liabilities  that may
result from the inaccuracy of any  representation or breach of warranty of it in
its individual capacity (or from the failure by it in its individual capacity to
perform any covenant) in this Trust Agreement, the Trust Indenture, the Lease or
the  Participation  Agreement  or  elsewhere  in  any  of  the  other  Operative
Agreements,  (e) taxes,  fees or other  charges on,  based on or measured by any
fees,  commissions or compensation received by First Security in connection with
the  transactions  contemplated  by this Trust Agreement and the other Operative
Agreements  to which it (in its  individual  capacity or as Owner  Trustee) is a
party,  (f) its or Owner Trustee's  failure to use ordinary care in receiving or
disbursing  funds or in connection  with its obligation to invest funds pursuant
to Section 4 of the Participation Agreement, Section 4.4 of the Lease or Section
4.3 hereof,  (g) any liability on the part of Owner  Trustee  arising out of its
negligence or willful or negligent misconduct in connection with its obligations
under Section 5.1 (other than the first sentence thereof),  6.8 or 9.2 hereof or
Section 4.01 of the Trust Indenture.  First Security shall have no obligation to
advance its  individual  funds for any purpose,  and Owner Trustee shall have no
obligation  to distribute  to Owner  Participant,  Lessee or any third party any
amounts to be paid to Owner  Trustee  until such amounts are  collected by Owner
Trustee.

          6.2 ABSENCE OF CERTAIN DUTIES.

          (a) Except in accordance with written instructions  furnished pursuant
     to Section 5.1 or 5.2 and except as provided  in, and without  limiting the
     generality  of,  Sections  3.1 and 5.4.1 and the last  sentence  of Section
     9.1.2,  and subject to Section 4.01 of the Trust  Indenture,  neither Owner
     Trustee nor First  Security shall have any duty (i) to see to any recording
     or filing of any Operative Agreement or of any supplement to any thereof or
     to see to the  maintenance  of any such  recording  or  filing or any other
     filing of reports with the FAA or other governmental agencies,  except that
     of First Security to comply with the FAA reporting  requirements  set forth
     in 14 C.F.R. ss. 47.45 and 14 C.F.R. ss. 47.51, and Owner Trustee shall, to
     the extent that  information  for that purpose is timely supplied by Lessee
     pursuant to any of the  Operative  Agreements,  complete and timely  submit
     (and furnish Owner Participant with a copy of) any and all reports relating
     to the  Aircraft  that may from time to time be  required by the FAA or any
     government or governmental  authority having  jurisdiction,  (ii) to see to
     any insurance on the Aircraft or to effect or maintain any such  insurance,
     whether or not Lessee shall be in default with respect thereto,  other than
     to forward to Owner  Participant  copies of all reports  and other  written
     information which Owner Trustee receives from Lessee pursuant to Section 11
     of the Lease,  (iii)  except as provided  in Section  7.3.1 or 7.3.2 of the
     Participation Agreement, Section 4.01 of the Trust Indenture or Section 5.4
     or 6.1 hereof, to see to the payment or discharge of any tax, assessment or
     other governmental charge or any lien or encumbrance of any kind owing with
     respect to or  assessed or levied  against any part of the Trust  Indenture
     Estate or the Trust  Estate,  except as  provided  in Section  6.3.9 of the
     Participation  Agreement or (iv) to inspect Lessee's books and records with
     respect to the Aircraft at any time permitted pursuant to the Lease.

          (b)  Notwithstanding   clause  (a),  Owner  Trustee  will  furnish  to
     Mortgagee and Owner Participant,  promptly upon receipt thereof, duplicates


<PAGE>


     or  copies  of  all  reports,  notices,  requests,  demands,  certificates,
     financial statements and other instruments furnished to Owner Trustee under
     the Lease or any other Operative  Agreement except to the extent to which a
     responsible  officer of Owner Trustee reasonably  believes (and confirms by
     telephone call with Owner  Participant)  that  duplicates or copies thereof
     have already been furnished to Owner Participant by some other person.

          6.3 NO  REPRESENTATIONS  OR WARRANTIES AS TO CERTAIN MATTERS.  NEITHER
FIRST  SECURITY NOR OWNER  TRUSTEE MAKES OR SHALL BE DEEMED TO HAVE MADE (a) ANY
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE,  AIRWORTHINESS,
VALUE, CONDITION,  DESIGN,  OPERATION,  MERCHANTABILITY OR FITNESS FOR USE FOR A
PARTICULAR  PURPOSE OF THE  AIRCRAFT OR ANY PART  THEREOF,  AS TO THE ABSENCE OF
LATENT OR OTHER DEFECTS,  WHETHER OR NOT DISCOVERABLE,  AS TO THE ABSENCE OF ANY
INFRINGEMENT  OF ANY PATENT,  TRADEMARK OR COPYRIGHT,  THE ABSENCE OF ANY STRICT
LIABILITY  OBLIGATION  OR ANY  OTHER  REPRESENTATION  OR  WARRANTY,  EXPRESS  OR
IMPLIED,  WITH RESPECT TO THE AIRCRAFT OR ANY PART  THEREOF  WHATSOEVER,  except
that First  Security  warrants to Owner  Participant  that on the Delivery  Date
Owner  Trustee  shall have  received  whatever  title to the  Aircraft  that was
conveyed to it and that the Aircraft  shall, on the Delivery Date and during the
Term,  be free  of  Lessor  Liens  attributable  to  First  Security  or (b) any
representation  or warranty as to the validity,  legality or  enforceability  of
this Trust Agreement or any other  Operative  Agreement to which First Security,
in its  individual  capacity  or as  Owner  Trustee,  is a party,  or any  other
document or instrument,  or as to the correctness of any statement  contained in
any  thereof  except to the extent that any such  statement  is  expressly  made
herein or therein by such party as a  representation  by First Security,  in its
individual  capacity  or as Owner  Trustee,  as the case may be, and except that
First Security  hereby  represents and warrants that it has all corporate  power
and authority to execute, deliver and perform this Trust Agreement and that this
Trust  Agreement  has been,  and  (assuming  due  authorization,  execution  and
delivery  by Owner  Participant  of this Trust  Agreement)  the other  Operative
Agreements  to which it or Owner Trustee is a party have been (or at the time of
execution and delivery of any such  instrument by it or Owner Trustee under this
Trust  Agreement or pursuant to the terms of the  Participation  Agreement  that
such an  instrument  will be) duly executed and delivered by one of its officers
who is or will be, as the case may be,  duly  authorized  to execute and deliver
such  instruments on behalf of itself or Owner Trustee,  as the case may be, and
that this Trust Agreement constitutes the legal, valid and binding obligation of
First Security or Owner Trustee,  as the case may be, enforceable  against First
Security or Owner Trustee, as the case may be, in accordance with its terms.

          6.4 NO  SEGREGATION  OF MONIES;  INTEREST.  Monies  received  by Owner
Trustee under this Trust  Agreement  need not be segregated in any manner except
to the extent  required by Law,  or except as  provided in written  instructions
from Owner Participant,  and shall be invested as provided in Section 4.3 hereof
or Section 4.4 of the Lease.

          6.5 RELIANCE  UPON  CERTIFICATES,  COUNSEL AND AGENTS.  Owner  Trustee
shall incur no liability to anyone in acting in good faith in reliance  upon and
in accordance  with any  signature,  instrument,  notice,  resolution,  request,


<PAGE>


consent,  order,  certificate,  report, opinion, bond or other document or paper
reasonably  believed  by it to be genuine  and  reasonably  believed by it to be
signed by the proper party or parties.  Unless other evidence in respect thereof
is  specifically  prescribed in this Trust  Agreement,  any request,  direction,
order or demand of Owner Participant or Lessee mentioned in this Trust Agreement
or in any of the other Owner Trustee Agreements shall be sufficiently  evidenced
by written  instruments signed by the Chairman of the Board, the President,  any
Vice  President  or any other  officer and in the name of Owner  Participant  or
Lessee,  as the case may be. Owner  Trustee may accept a copy of a resolution of
the Board of  Directors  or  Executive  Committee  of Lessee,  certified  by the
Secretary or an Assistant  Secretary of Lessee as duly adopted and in full force
and effect, as conclusive evidence that such resolution has been duly adopted by
said Board of  Directors  or  Executive  Committee  and that the same is in full
force and effect.  As to any fact or matter the manner of ascertainment of which
is not specifically described in this Trust Agreement, Owner Trustee may, absent
Actual Knowledge to the contrary,  for all purposes rely on a certificate signed
by the Chairman of the Board,  the  President,  any Vice  President or any other
officer of Lessee, and the Treasurer or an Assistant  Treasurer or the Secretary
or an  Assistant  Secretary  of  Lessee,  as to such  fact or  matter,  and such
certificate  shall  constitute  full  protection to Owner Trustee for any action
taken or  omitted  to be taken by it in good faith in  reliance  thereon  and in
accordance  therewith.   In  the  administration  of  trusts  under  this  Trust
Agreement, Owner Trustee may execute any of the trusts or powers and perform its
powers and  duties  under this Trust  Agreement  directly  or through  agents or
attorneys  and may, at the expense of the Trust  Estate,  consult with  counsel,
accountants  and other skilled  persons to be selected and employed by it. Owner
Trustee shall not be liable for anything done, suffered or omitted in good faith
by it in accordance with the advice or opinion of any such counsel,  accountants
or other skilled persons.

          6.6 NOT  ACTING IN  INDIVIDUAL  CAPACITY.  In acting  under this Trust
Agreement, First Security acts solely as Owner Trustee and not in its individual
capacity  except as otherwise  expressly  provided in this Trust Agreement or in
the other  Operative  Agreements to which it is a party;  and,  except as may be
otherwise   expressly   provided  in  this  Trust  Agreement,   the  Lease,  the
Participation  Agreement and the Trust  Indenture,  all persons,  other than the
Owner  Participant as provided in this Trust  Agreement or the Trust  Indenture,
having  any  claim  against   Owner  Trustee  by  reason  of  the   transactions
contemplated  hereby  shall  look  only  to the  Trust  Estate  for  payment  or
satisfaction  thereof except to the extent  provided in Section 6.1 or otherwise
as Owner Trustee shall expressly agree otherwise in writing.

          6.7  FEES;   COMPENSATION.   Airframe   Manufacturer   shall  pay  the
Transaction  Expenses  and ongoing  fees of Owner  Trustee  throughout  the Term
pursuant to Section 9.2 of the Participation  Agreement.  The Trust Estate shall
not have any  liability  for any such  fees  and  expenses;  PROVIDED,  that the
foregoing  shall not limit the obligations of Owner  Participant  under Sections
5.3 and 7; PROVIDED,  that Owner Trustee shall have a Lien upon the Trust Estate
for any such fee not paid by Airframe  Manufacturer  as  contemplated by Section
9.2 of the Participation  Agreement and such Lien shall entitle Owner Trustee to
priority as to payment thereof over payment to any other Person under this Trust
Agreement;  PROVIDED,  that such Lien shall be subject  and  subordinate  in all
events to the Lien of the Trust  Indenture;  and PROVIDED,  FURTHER,  that Owner
Trustee shall have no right to exercise,  and shall not exercise,  any rights or


<PAGE>


remedies  Owner  Trustee may have with respect to such Lien unless and until the
Secured Obligations have been paid and performed in full.

          6.8 TAX RETURNS. Owner Trustee shall be responsible for the keeping of
all appropriate  books and records  relating to the receipt and  disbursement of
all monies under this Trust  Agreement  or any  agreement  contemplated  hereby.
Owner  Participant shall be responsible for causing to be prepared and filed all
income tax returns  required  to be filed by Owner  Participant.  Owner  Trustee
shall be  responsible  for  causing to be  prepared,  at the expense of Airframe
Manufacturer,  all income tax returns  required to be filed with  respect to the
trust created  hereby and shall execute and file such  returns;  PROVIDED,  that
Owner  Trustee  shall send  promptly a  completed  copy of such  return to Owner
Participant not more than sixty nor less than fifteen days prior to the due date
of the return,  PROVIDED,  that Owner  Trustee  shall have timely  received  all
necessary  information to complete and deliver to Owner Participant such return.
Owner  Participant,  upon  request,  will  furnish  Owner  Trustee with all such
information as may be reasonably  required from Owner  Participant in connection
with the preparation of such income tax returns. Owner Trustee shall keep copies
of all returns delivered to or filed by it.

          Section 7. INDEMNIFICATION  OF FIRST  SECURITY  BY OWNER  PARTICIPANT.
Owner  Participant  hereby  agrees,  whether  or not  any  of  the  transactions
contemplated  hereby shall be consummated,  to assume  liability for, and hereby
indemnifies,  protects,  saves  and  keeps  harmless,  First  Security  and  its
successors,  assigns,  agents  and  servants,  from  and  against  any  and  all
liabilities, obligations, losses, damages, penalties, taxes (excluding any Taxes
which are not required to be  indemnified  by Lessee  pursuant to Section 9.1 or
9.3 of the  Participation  Agreement  and  excluding  any taxes payable by First
Security on or measured by any  compensation  received by First Security for its
services under this Trust Agreement), claims, actions, suits, costs, expenses or
disbursements  (including,   without  limitation,   reasonable  legal  fees  and
expenses,  but  excluding  internal  costs and  expenses  such as  salaries  and
overhead,  and including,  without  limitation,  any liability of an owner,  any
strict  liability  and any  liability  without  fault)  of any kind  and  nature
whatsoever  which may be imposed  on,  incurred  by or  asserted  against  First
Security  (whether or not also indemnified  against by Lessee under the Lease or
under the  Participation  Agreement  or also  indemnified  against  by any other
Person;  PROVIDED,  that Owner  Participant shall be subrogated to the rights of
Owner Trustee against Lessee or any other  indemnitor) in any way relating to or
arising out of this Trust Agreement or any of the other Operative  Agreements or
the enforcement of any of the terms of any thereof, or in any way relating to or
arising out of the manufacture, purchase, acceptance, nonacceptance,  rejection,
ownership, delivery, lease, possession, use, operation,  condition, sale, return
or other disposition of the Aircraft (including,  without limitation, latent and
other defects, whether or not discoverable,  and any claim for patent, trademark
or  copyright  infringement),  or in any way  relating  to or arising out of the
administration  of the Trust Estate or the action or inaction of Owner  Trustee,
under  this  Trust  Agreement,  except  (a) in the case of gross  negligence  or
willful misconduct on the part of First Security,  in its individual capacity or
as Owner Trustee,  in the performance or nonperformance of its duties under this
Trust Agreement or under any of the other Owner Trustee  Agreements or (b) those
Claims resulting from the inaccuracy of any  representation or warranty of First
Security (or from the failure of First Security to perform any of its covenants)
in Section  6.3,  in Section  6.03 of the Trust  Indenture,  in Section 4 of the


<PAGE>


Lease, in Section 6.3 of the Participation  Agreement or elsewhere in any of the
other Operative  Agreements or (c) as may result from a breach by First Security
of its covenant in the last  sentence of Section 5.4.1 or (d) in the case of the
failure to use ordinary care on the part of First  Security,  in its  individual
capacity  or as Owner  Trustee,  in the receipt or  disbursement  of funds or in
connection  with its  obligation  to invest  funds  pursuant to Section 4 of the
Participation  Agreement,  Section  4.4 of the Lease or Section 4.3 hereof or in
compliance  with the  provisions of the first sentence of Section 6.8 or (e) any
liability on the part of Owner Trustee  arising out of its negligence or willful
or negligent  misconduct in connection with its  obligations  under Section 5.1,
6.8 or 9.2 hereof or Section  4.01 of the Trust  Indenture,  or (f) those claims
arising  under any  circumstances  or upon any terms where Lessee would not have
been required to indemnify First Security  pursuant to Section 9.1 or 9.3 of the
Participation  Agreement  (disregarding for purposes of this paragraph  Sections
9.1.2(b)  and  9.3.2(j));   PROVIDED,   that  before   asserting  its  right  to
indemnification,  if any, pursuant to this Section 7, First Security shall first
demand its corresponding  right to indemnification  pursuant to Section 9 of the
Participation  Agreement  (but need not  exhaust any or all  remedies  available
thereunder).  The  indemnities  contained  in this  Section  7  extend  to First
Security  only  in  its  individual  capacity  and  shall  not be  construed  as
indemnities  of the Trust  Indenture  Estate or the Trust Estate  (except to the
extent,  if any, that First Security has been  reimbursed by the Trust Indenture
Estate or the Trust Estate for amounts covered by the  indemnities  contained in
this Section 7). The  indemnities  contained in this Section 7 shall survive the
termination of this Trust Agreement.  In addition, if necessary,  First Security
shall be entitled to indemnification from the Trust Estate,  subject to the Lien
of the Trust Indenture,  for any liability,  obligation,  loss, damage, penalty,
tax, claim,  action,  suit, cost,  expense or disbursement  indemnified  against
pursuant  to this  Section 7 to the  extent  not  reimbursed  by  Lessee,  Owner
Participant or others,  but without  releasing any of them from their respective
agreements of reimbursement; and, to secure the same First Security shall have a
lien on the Trust Estate, subject to the lien of the Trust Indenture and subject
further to the  provisions of Section 6.7,  which shall be prior to any interest
therein of Owner  Participant.  The payor of any indemnity  under this Section 7
shall be  subrogated  to any right of the person  indemnified  in respect of the
matter as to which such indemnity was paid.

          Section 8.  Transfer Of Owner Participant's Interest.

          8.1  TRANSFER  OF  INTEREST.  All  provisions  of  Section  10 of  the
Participation Agreement shall (with the same force and effect as if set forth in
full in this Section 8.1) be applicable to any  assignment,  conveyance or other
transfer by Owner  Participant of any of its right,  title or interest in and to
the Participation Agreement, the Trust Estate or this Trust Agreement.

          Section 9.  Successor Owner Trustees; Co-Trustees.

          9.1 RESIGNATION OF OWNER TRUSTEE; APPOINTMENT OF SUCCESSOR

               9.1.1  RESIGNATION  OR REMOVAL.  Owner  Trustee or any  successor
     Owner  Trustee  (a) shall  resign if  required to do so pursuant to Section
     13.3 of the  Participation  Agreement or upon obtaining Actual Knowledge of


<PAGE>


     any facts that would cast doubt upon its continuing  status as a Citizen of
     the United States and (b) may resign at any time without cause by giving at
     least 60 days' prior  written  notice to Owner  Participant,  Mortgagee and
     Lessee,  such resignation to be effective upon the assumption of the trusts
     hereunder by the successor  Owner Trustee under Section 9.1.2. In addition,
     Owner  Participant  may at any time remove Owner  Trustee,  with or without
     cause by a notice in writing  delivered  to Owner  Trustee,  Mortgagee  and
     Lessee,  such removal to be  effective  upon the  assumption  of the trusts
     hereunder by the successor  Owner Trustee  under Section  9.1.2,  PROVIDED,
     that,  in the case of a  removal  without  cause,  unless a Lease  Event of
     Default  shall have  occurred  and be  continuing,  such  removal  shall be
     subject to the consent of Lessee (which  consent shall not be  unreasonably
     withheld).  In the case of the  resignation  or removal  of Owner  Trustee,
     Owner  Participant  may appoint a successor  Owner Trustee by an instrument
     signed by Owner  Participant,  with,  unless a Lease Event of Default shall
     have occurred and be continuing, the consent of Lessee (which consent shall
     not be unreasonably  withheld). If a successor Owner Trustee shall not have
     been appointed  within 30 days after such notice of resignation or removal,
     Owner Trustee, any Owner Participant,  Lessee or Mortgagee may apply to any
     court of competent jurisdiction to appoint a successor Owner Trustee to act
     until such time, if any, as a successor  shall have been appointed as above
     provided.  Any  successor  Owner  Trustee so  appointed by such court shall
     immediately  and without  further act be superseded by any successor  Owner
     Trustee  appointed as above  provided  within one year from the date of the
     appointment by such court.

               9.1.2  EXECUTION  AND DELIVERY OF  DOCUMENTS,  ETC. Any successor
     Owner  Trustee,  however  appointed,  shall  execute  and  deliver  to  the
     predecessor  Owner Trustee,  with a copy to Owner  Participant,  Lessee and
     Mortgagee,  an  instrument  accepting  such  appointment  and  assuming the
     obligations  of Owner  Trustee,  in its  individual  capacity  and as Owner
     Trustee,  under the Owner Trustee Agreements,  and thereupon such successor
     Owner  Trustee,  without  further  act,  shall  become  vested with all the
     estates,  properties,  rights, powers, duties and trusts of the predecessor
     Owner Trustee in the trusts under this Trust  Agreement with like effect as
     if   originally   named  Owner  Trustee  in  this  Trust   Agreement;   but
     nevertheless,  upon the written  request of such  successor  Owner Trustee,
     such  predecessor  Owner  Trustee  shall  execute and deliver an instrument
     transferring  to such  successor  Owner  Trustee,  upon the  trusts  herein
     expressed, all the estates,  properties,  rights, powers and trusts of such
     predecessor  Owner Trustee,  and such predecessor  Owner Trustee shall duly
     assign, transfer,  deliver and pay over to such successor Owner Trustee all
     monies or other property then held by such  predecessor  Owner Trustee upon
     the trusts herein  expressed.  Upon the  appointment of any successor Owner
     Trustee under this Section 9.1, the predecessor  Owner Trustee will execute
     such  documents as are provided to it by such  successor  Owner Trustee and
     will take such further  actions as are  requested  of it by such  successor
     Owner  Trustee  as are  required  to  cause  registration  of the  Aircraft
     included in the Trust Estate to be transferred upon the records of the FAA,
     or other governmental  authority having jurisdiction,  into the name of the
     successor Owner Trustee.


<PAGE>

               9.1.3  QUALIFICATIONS.   Any  successor  Owner  Trustee,  however
     appointed, shall be a Citizen of the United States and shall also be a bank
     or trust company organized under the Laws of the United States or any state
     thereof having a combined capital and surplus of at least $100,000,000,  if
     there be such an institution willing, able and legally qualified to perform
     the duties of Owner Trustee under this Trust  Agreement upon  reasonable or
     customary  terms.  No such  successor  Owner  Trustee shall be located in a
     jurisdiction which creates material adverse consequences for Lessee (unless
     such material adverse  consequences  would be created by substantially  all
     jurisdictions where major banking or trust institutions are located).

               9.1.4 MERGER,  ETC. Any corporation into which First Security may
     be  merged  or  converted  or with  which  it may be  consolidated,  or any
     corporation resulting from any merger, conversion or consolidation to which
     First Security shall be a party, or any corporation to which  substantially
     all the  corporate  trust  business of First  Security may be  transferred,
     shall,  subject to the terms of Section 9.1.3,  be Owner Trustee under this
     Trust Agreement without further act, PROVIDED,  that such corporation shall
     not also be the Mortgagee.

          9.2 CO-TRUSTEES AND SEPARATE TRUSTEES.

          (a) If at any  time it  shall  be  necessary  or  prudent  in order to
     conform  to any Law of any  jurisdiction  in  which  all or any part of the
     Trust Estate is located,  or Owner  Trustee  being advised by counsel shall
     determine  that it is so  necessary  or  prudent in the  interest  of Owner
     Participant or Owner Trustee,  or Owner Trustee shall have been directed to
     do so by Owner  Participant,  Owner  Trustee  and Owner  Participant  shall
     execute  and  deliver  an  agreement  supplemental  hereto  and  all  other
     instruments and agreements  necessary or proper to constitute  another bank
     or trust  company or one or more  persons  (any or all of which  shall be a
     Citizen  of  the  United  States)  approved  by  Owner  Trustee  and  Owner
     Participant, either to act as co-trustee, jointly with Owner Trustee, or to
     act as separate  trustee under this Trust Agreement (any such co-trustee or
     separate  trustee  being  herein  sometimes  referred to as an  "additional
     trustee").  In the event  Owner  Participant  shall not have  joined in the
     execution of such agreements' supplemental hereto within ten days after the
     receipt  of a written  request  from  Owner  Trustee so to do, or in case a
     Lease  Event of Default or  Indenture  Event of Default  shall occur and be
     continuing,  Owner Trustee may act under the  foregoing  provisions of this
     Section  9.2  without  the  concurrence  of Owner  Participant;  and  Owner
     Participant hereby appoints Owner Trustee its agent and attorney-in-fact to
     act for it under the foregoing  provisions of this Section 9.2 in either of
     such contingencies.

          (b) Every additional  trustee under this Trust Agreement shall, to the
     extent  permitted by Law, be appointed  and act, and Owner  Trustee and its
     successors shall act, subject to the following provisions and conditions:

               (i) All powers,  duties,  obligations  and rights  conferred upon
          Owner  Trustee in respect of the custody,  control and  management  of


<PAGE>


          monies,  the Aircraft or documents  authorized  to be delivered  under
          this Trust  Agreement or under the  Participation  Agreement  shall be
          exercised solely by Owner Trustee;

               (ii) All other rights,  powers,  duties and obligations conferred
          or imposed upon Owner  Trustee  shall be conferred or imposed upon and
          exercised or performed by Owner  Trustee and such  additional  trustee
          jointly,  except to the extent that under any Law of any  jurisdiction
          in which any particular act or acts are to be performed (including the
          holding  of  title  to  the  Trust  Estate)  Owner  Trustee  shall  be
          incompetent or unqualified to perform such act or acts, in which event
          such rights,  powers,  duties and  obligations  shall be exercised and
          performed by such additional trustee;

               (iii) No power  given to, or which it is  provided  hereby may be
          exercised by, any such  additional  trustee  shall be exercised  under
          this Trust Agreement by such additional trustee,  except jointly with,
          or with the consent in writing of, Owner Trustee;

               (iv) No trustee  under this Trust  Agreement  shall be personally
          liable by reason of any action or omission of any other  trustee under
          this Trust Agreement;

               (v) Owner  Participant,  at any time, by an instrument in writing
          may  remove  any such  additional  trustee.  In the event  that  Owner
          Participant  shall  not  have  joined  in the  execution  of any  such
          instrument within ten days after the receipt of a written request from
          Owner  Trustee so to do, Owner  Trustee shall have the power to remove
          any  such   additional   trustee  without  the  concurrence  of  Owner
          Participant;  and Owner Participant  hereby appoints Owner Trustee its
          agent and  attorney-in-fact  to act for it in such  connection in such
          contingency; and

               (vi) No appointment of, or action by, any additional trustee will
          relieve Owner Trustee of any of its  obligations  under,  or otherwise
          affect  any of the  terms  of,  the  Trust  Indenture  or  affect  the
          interests  of  Mortgagee  or the Note  Holders in the Trust  Indenture
          Estate.

          (c) In case any  separate  trustee  under this  Section 9.2 shall die,
     become  incapable of acting,  resign or be removed,  the title to the Trust
     Estate and all rights and duties of such separate  trustee shall, so far as
     permitted by Law,  vest in and be exercised by Owner  Trustee,  without the
     appointment of a successor to such separate trustee.

          Section 10.  SUPPLEMENTS  AND AMENDMENTS TO TRUST  AGREEMENT AND OTHER
DOCUMENTS.

          10.1 SUPPLEMENTS AND AMENDMENTS AND DELIVERY THEREOF.

               10.1.1  SUPPLEMENTS AND  AMENDMENTS.  Subject to Section 7.2.2 of
     the  Participation  Agreement,  this Trust  Agreement  may not be  amended,
     supplemented  or  otherwise  modified  except by an  instrument  in writing


<PAGE>


     signed by Owner  Trustee and Owner  Participant.  Subject to Section  10.2,
     Section 9.01 of the Trust Indenture and Section 7.6.7 of the  Participation
     Agreement,  Owner Trustee will execute any  amendment,  supplement or other
     modification  of  this  Trust  Agreement  or of  any  other  Owner  Trustee
     Agreement which it is requested in writing to execute by Owner Participant,
     except that Owner Trustee shall not execute any such amendment,  supplement
     or other modification  which, by the express provisions of any of the above
     documents,  requires  the  consent of any other party  unless such  consent
     shall have been  obtained;  and PROVIDED,  that,  without the prior written
     consent  of  Owner  Participant,  (a)  no  such  supplement,  amendment  or
     modification  shall (i) modify any of the  provisions  of Section 4 or this
     Section  10.1,  (ii) reduce,  modify or amend any  indemnities  in favor of
     Owner Participant as set forth in Section 9 of the Participation  Agreement
     or in the Tax  Indemnity  Agreement,  (iii) reduce the amount or extend the
     time of payment of Basic Rent,  Supplemental Rent, Stipulated Loss Value or
     Termination  Value as set forth in the Lease  (except  in  accordance  with
     Section  3 of  the  Lease)  or  (iv)  modify  any of the  rights  of  Owner
     Participant under the Trust Indenture and (b) no such supplement, amendment
     or modification  shall require Owner Participant to invest or advance funds
     or shall entail any additional  personal  liability or the surrender of any
     indemnification, claim or individual right on the part of Owner Participant
     with respect to any agreement or obligation.

               10.1.2 DELIVERY OF AMENDMENTS AND SUPPLEMENTS TO CERTAIN PARTIES.
     A signed copy of each amendment or supplement referred to in Section 10.1.1
     to which Lessee is not a party shall be delivered promptly by Owner Trustee
     to Lessee, and a signed copy of each amendment or supplement referred to in
     Section 10.1.1 shall be delivered promptly by Owner Trustee to Mortgagee.

          10.2  DISCRETION AS TO EXECUTION OF DOCUMENTS.  Prior to executing any
document  required to be  executed by it pursuant to the terms of Section  10.1,
Owner  Trustee  shall be  entitled  to receive an opinion of its  counsel to the
effect  that the  execution  of such  document  is  authorized  under this Trust
Agreement.  If in the  opinion  of Owner  Trustee  any such  document  adversely
affects any right,  duty,  immunity or indemnity in favor of Owner Trustee under
this Trust Agreement or under any other Owner Trustee  Agreement,  Owner Trustee
may in its discretion  decline to execute such document  unless Owner Trustee is
furnished with  indemnification from Lessee or any other party upon terms and in
amounts reasonably satisfactory to Owner Trustee to protect the Trust Estate and
the Owner Trustee against any and all  liabilities,  costs and expenses  arising
out of the execution of such documents.

          10.3 ABSENCE OF REQUIREMENTS AS TO FORM. It shall not be necessary for
any written request furnished pursuant to Section 10.1 to specify the particular
form of the proposed documents to be executed pursuant to such Section 10.1, but
it shall be sufficient if such request shall indicate the substance thereof.

          10.4 DISTRIBUTION OF DOCUMENTS.  Promptly after the execution by Owner
Trustee of any document  entered into  pursuant to Section  10.1,  Owner Trustee
shall mail, by certified  mail,  postage  prepaid,  a conformed  copy thereof to


<PAGE>


Owner Participant,  but the failure of Owner Trustee to mail such conformed copy
shall not impair or affect the validity of such document.

          10.5 NO  REQUEST  NEEDED AS TO LEASE  SUPPLEMENT  AND TRUST  INDENTURE
SUPPLEMENT.  No written  request  pursuant to Section  10.1 shall be required to
enable Owner Trustee to enter into, pursuant to Section 3.1 and the Lease or the
Trust  Indenture,  as the case may be, the Lease  Supplement with Lessee and the
Trust Indenture Supplement.

          Section 11. Miscellaneous.

          11.1  TERMINATION  OF TRUST  AGREEMENT.  This Trust  Agreement and the
trusts created hereby shall be of no further force or effect upon the earlier of
(a) both the final  discharge of the Trust  Indenture  pursuant to Section 10.01
thereof and the sale or other final disposition by Owner Trustee of all property
constituting  part of the  Trust  Estate  and the  final  distribution  by Owner
Trustee of all monies or other  property  or proceeds  constituting  part of the
Trust Estate in accordance  with Section 4,  PROVIDED,  that at such time Lessee
shall  have  fully  complied  with  all  of  the  terms  of the  Lease  and  the
Participation Agreement or (b) 21 years less one day after the death of the last
survivor of all of the descendants of the  grandparents of David C.  Rockefeller
living on the date of the  earliest  execution  of this Trust  Agreement  by any
party hereto, but if this Trust Agreement and the trusts created hereby shall be
or become authorized under applicable Law to be valid for a period commencing on
the 21st  anniversary of the death of such last survivor (or,  without  limiting
the generality of the foregoing, if legislation shall become effective providing
for the validity of this Trust  Agreement  and the trusts  created  hereby for a
period in gross  exceeding  the period for which  this Trust  Agreement  and the
trusts created hereby are hereinabove stated to extend and be valid),  then this
Trust  Agreement and the trusts  created  hereby shall not terminate  under this
clause  (b) but  shall  extend  to and  continue  in  effect,  but  only if such
nontermination and extension shall then be valid under applicable Law, until the
day preceding  such date as the same shall,  under  applicable  Law, cease to be
valid;  otherwise  this Trust  Agreement  and the trusts  created  hereby  shall
continue in full force and effect in accordance with the terms hereof. Except as
expressly set forth in Section 11.2, this Trust Agreement and the trusts created
hereby may not be revoked by Owner Participant.

          11.2 TERMINATION AT OPTION OF THE OWNER  PARTICIPANT.  Notwithstanding
Section 11.1 hereof, this Agreement and trust created hereby shall terminate and
the  Trust  Estate  shall be  distributed  to the  Owner  Participant,  and this
Agreement  shall be of no further  force and  effect,  upon the  election of the
Owner  Participant  by notice  to the Owner  Trustee,  if such  notice  shall be
accompanied by the written agreement (in form and substance  satisfactory to the
Owner Trustee) of the Owner  Participant  assuming all  obligations of the Owner
Trustee under or contemplated  by the Operative  Agreements or incurred by it as
trustee hereunder and releasing the Owner Trustee therefrom;  provided, however,
that  such  notice  may be given  only  after  the  time  the Lien of the  Trust
Indenture is discharged under Section 10.01 of the Trust Indenture and after the
Lease  shall no longer be in  effect.  Notwithstanding  anything  in this  Trust
Agreement  to the  contrary,  the Owner  Participant  shall not remove the Owner
Trustee without cause.



<PAGE>


          11.3  OWNER  PARTICIPANT  HAS NO LEGAL  TITLE IN TRUST  ESTATE.  Owner
Participant  shall  not have  legal  tit