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):
                                  June 29, 2004


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


        Delaware                       1-10323                   74-2099724
(State or other jurisdiction    (Commission File Number)     (IRS Employer
 of incorporation)                                           Identification No.)


1600 Smith Street, Dept. HQSEO, Houston, Texas                     77002
(Address of principal executive offices)                         (Zip Code)


                                 (713) 324-2950
              (Registrant's telephone number, including area code)





Item 7.  Financial Statements and Exhibits.

(c) Exhibits. The Exhibit Index is hereby incorporated by reference. The
documents listed on the Exhibit Index are filed as Exhibits with reference to
the Registration Statement on Form S-3 (Registration No. 333-67886) of
Continental Airlines, Inc. The Registration Statement and the final Prospectus
Supplement, dated June 18, 2004, to the Prospectus, dated August 23, 2001,
relate to the offering of Continental Airlines, Inc.'s Pass Through
Certificates, Series 2004-ERJ1.





                                    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.


July 7, 2004                              By /s/ GERALD LADERMAN
                                            ------------------------------------
                                             Gerald Laderman
                                             Senior Vice President - Finance and
                                             Treasurer




                                  EXHIBIT INDEX


            1.1   Underwriting Agreement, dated June 18, 2004, among
                  Citigroup Global Markets Inc. and Morgan Stanley & Co.
                  Incorporated, as Underwriters, WestLB AG, New York Branch,
                  as Depositary, Embraer-Empresa Brasileira de Aeronautica
                  S.A. and Continental Airlines, Inc.

            4.1   Trust Supplement No. 2004-ERJ1, dated as of June 29, 2004,
                  between Wilmington Trust Company, as Trustee, and
                  Continental Airlines, Inc. to Pass Through Trust Agreement,
                  dated as of September 25, 1997

            4.2   Revolving Credit Agreement (2004-ERJ1), dated as of June
                  29, 2004, between Wilmington Trust Company, as
                  Subordination Agent, as Borrower, and WestLB AG, New York
                  Branch, as Liquidity Provider

            4.3   Revolving Credit Agreement (2004-ERJ1), dated as of June
                  29, 2004, between Wilmington Trust Company, as
                  Subordination Agent, as Borrower, and Citicorp North
                  America, Inc., as Liquidity Provider

            4.4   Guarantee, dated June 29, 2004, by Citicorp, relating to
                  the Revolving Credit Agreement (2004-ERJ1), dated as of
                  June 29, 2004, between Wilmington Trust Company, as
                  Subordination Agent, as Borrower, and Citicorp North
                  America, Inc., as Liquidity Provider

            4.5   Intercreditor Agreement, dated as of June 29, 2004, among
                  Wilmington Trust Company, as Trustee, WestLB AG, New York
                  Branch, and Citicorp North America, Inc., as Liquidity
                  Providers, and Wilmington Trust Company, as Subordination
                  Agent and Trustee

            4.6   Deposit Agreement, dated as of June 29, 2004, between Wells
                  Fargo Bank Northwest, National Association, as Escrow
                  Agent, and WestLB AG, New York Branch, as Depositary

            4.7   Escrow and Paying Agent Agreement, dated as of June 29,
                  2004, among Wells Fargo Bank Northwest, National
                  Association, as Escrow Agent, Citigroup Global Markets Inc.
                  and Morgan Stanley & Co. Incorporated, as Underwriters,
                  Wilmington Trust Company, as Trustee, and Wilmington Trust
                  Company, as Paying Agent

            4.8   Note Purchase Agreement, dated as of June 29, 2004, among
                  Continental Airlines, Inc., Wilmington Trust Company, as
                  Trustee, Subordination Agent and Paying Agent, and Wells
                  Fargo Bank Northwest, National Association, as Escrow Agent

            4.9   Form of Participation Agreement (Participation Agreement
                  among Continental Airlines, Inc., as Lessee, [__________],
                  as Owner Participant, Wells Fargo Bank Northwest, National
                  Association, as Owner Trustee and Lessor, Wilmington Trust
                  Company, as Mortgagee, Subordination Agent and Trustee, and



                  Embraer-Empresa Brasileira de Aeronautica S.A.) (Exhibit A
                  to Note Purchase Agreement)

            4.10  Form of Lease (Lease between Wells Fargo Bank Northwest,
                  National Association, as Owner Trustee and Lessor, and
                  Continental Airlines, Inc., as Lessee) (Exhibit B to Note
                  Purchase Agreement)

            4.11  Form of Indenture (Trust Indenture and Mortgage between
                  Wells Fargo Bank Northwest, National Association, as Owner
                  Trustee, and Wilmington Trust Company, as Mortgagee)
                  (Exhibit C to Note Purchase Agreement)

            4.12  Form of Trust Agreement ([Amended and Restated] Trust
                  Agreement between [__________], as Owner Participant, and
                  Wells Fargo Bank Northwest, National Association, as Owner
                  Trustee) (Exhibit E to Note Purchase Agreement)

            4.13  9.558% Continental Airlines Pass Through Certificate,
                  Series 2004-ERJ1, Certificate No. 1

            23.1  Consent of Aviation Specialists Group, Inc., dated June 14,
                  2004

            23.2  Consent of AvSolutions, Inc., dated June 14, 2004

            23.3  Consent of BK Associates, Inc., dated June 14, 2004

            23.4  Consent of Aviation Specialists Group, Inc., dated June 17,
                  2004

            23.5  Consent of AvSolutions, Inc., dated June 17, 2004

            23.6  Consent of BK Associates, Inc., dated June 17, 2004



                                                               EXECUTION VERSION




                           CONTINENTAL AIRLINES, INC.

                   Pass Through Certificates, Series 2004-ERJ1

                             UNDERWRITING AGREEMENT


                                                June 18, 2004


Citigroup Global Markets Inc.
Morgan Stanley & Co. Incorporated

c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York  10013
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York  10036

Ladies and Gentlemen:

            At the request of Embraer - Empresa Brasileira de Aeronautica S.A.,
a Brazilian corporation ("EMBRAER"), Continental Airlines, Inc., a Delaware
corporation (the "COMPANY"), proposes that Wilmington Trust Company, as trustee
under the Class A Trust (as defined below) (the "TRUSTEE"), issue and sell to
the underwriters named in Schedule II hereto (the "UNDERWRITERS") its pass
through certificates in the aggregate principal amount and with the interest
rate and final maturity date set forth on Schedule I hereto (the "OFFERED
CERTIFICATES") on the terms and conditions stated herein.

            The Offered Certificates will be issued pursuant to a Pass Through
Trust Agreement, dated as of September 25, 1997 (the "BASIC AGREEMENT"), between
the Company and the Trustee, as supplemented with respect to the issuance of the
Offered Certificates by a Pass Through Trust Supplement to be dated as of the
Closing Date (as defined below) (the "TRUST SUPPLEMENT"), between the Company
and the Trustee (the Basic Agreement as supplemented by such Trust Supplement
being referred to herein as the "PASS THROUGH TRUST AGREEMENT"). The Trust
Supplement is related to the creation and administration of the 2004-ERJ1 Pass
Through Trust (the "CLASS A TRUST"). As used herein, unless the context
otherwise requires, the term "you" shall mean, collectively, Citigroup Global
Markets Inc. ("CITIGROUP") and Morgan Stanley & Co. Incorporated.




            The cash proceeds of the offering of Offered Certificates by the
Class A Trust, to the extent not used to purchase Equipment Notes (as defined in
the Note Purchase Agreement (as defined below)) on the Closing Date, will be
paid to Wells Fargo Bank Northwest, National Association, as escrow agent (the
"ESCROW AGENT"), under an Escrow and Paying Agent Agreement among the Escrow
Agent, the Underwriters, the Trustee and Wilmington Trust Company, as paying
agent (the "PAYING AGENT"), for the benefit of the holders of the Offered
Certificates (the "ESCROW AGREEMENT"). The Escrow Agent will deposit such cash
proceeds (each, a "DEPOSIT") with WestLB AG, acting through its New York Branch
(the "DEPOSITARY"), in accordance with a Deposit Agreement relating to the Class
A Trust (the "DEPOSIT AGREEMENT"), and, subject to the fulfillment of certain
conditions, will withdraw Deposits upon request to allow the Trustee to purchase
Equipment Notes from time to time pursuant to a Note Purchase Agreement to be
dated as of the Closing Date (the "NOTE PURCHASE AGREEMENT") among the Company,
Wilmington Trust Company, as Trustee of the Class A Trust, as Subordination
Agent (as hereinafter defined) and as Paying Agent, and the Escrow Agent. The
Escrow Agent will issue receipts to be attached to each related Offered
Certificate ("ESCROW RECEIPTS") representing each holder's fractional undivided
interest in amounts deposited with such Escrow Agent with respect to the Offered
Certificates and will pay to such holders through the Paying Agent interest
accrued on the Deposits and received by such Paying Agent pursuant to the
Deposit Agreement at a rate per annum equal to the interest rate applicable to
the Offered Certificates.

            Certain amounts of interest payable on the Offered Certificates will
be entitled to the benefits of separate liquidity facilities. WestLB AG, acting
through its New York Branch ("WESTLB"), and Citicorp North America, Inc. ("CNAI"
and, together with WestLB, the "LIQUIDITY PROVIDERS") will each enter into a
revolving credit agreement with respect to the Class A Trust (each, a Liquidity
Facility) to be dated as of the Closing Date for the benefit of the holders of
the Offered Certificates issued by such Class A Trust. The obligations of CNAI
under its Liquidity Facility will be guaranteed by Citicorp (the "LIQUIDITY
PROVIDER GUARANTOR"). The Liquidity Providers and the holders of the Offered
Certificates will be entitled to the benefits of an Intercreditor Agreement to
be dated as of the Closing Date (the "INTERCREDITOR AGREEMENT") among the
Trustee, Wilmington Trust Company, as subordination agent and trustee thereunder
(the "SUBORDINATION AGENT"), and the Liquidity Providers.

            The Company has filed with the Securities and Exchange Commission
(the "COMMISSION") a shelf registration statement on Form S-3 (File No.
333-67886) relating to pass through certificates (such registration statement
(including the respective exhibits thereto and the respective documents filed by
the Company with the Commission pursuant to the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "EXCHANGE Act"), that are incorporated by reference therein),
as amended at the date hereof, being herein referred to as the "REGISTRATION
STATEMENT") and the offering thereof from time to time in accordance with Rule
415 of the Securities Act of 1933, as amended, and the rules and regulations of
the Commission thereunder (collectively, the "SECURITIES ACT"). The Registration
Statement has been declared effective by the Commission. A final prospectus
supplement reflecting the terms of the Offered Certificates, the terms of the
offering thereof and other matters relating to the Offered Certificates, as
further specified in Section 4(d) hereof, will be prepared and filed together
with the Basic Prospectus referred to below pursuant to Rule 424 under the
Securities Act (such prospectus supplement, in the form first filed on or after



the date hereof pursuant to Rule 424, being herein referred to as the
"PROSPECTUS SUPPLEMENT" and any such prospectus supplement in the form or forms
filed prior to the filing of the Prospectus Supplement being herein referred to
as a "PRELIMINARY PROSPECTUS SUPPLEMENT"). The Basic Prospectus included in the
Registration Statement (the "BASIC PROSPECTUS") and relating to all offerings of
pass through certificates under the Registration Statement, as supplemented by
the Preliminary Prospectus Supplement or the Prospectus Supplement, as the case
may be, and, in either case, including the documents incorporated by reference
therein, is herein called, the "PRELIMINARY PROSPECTUS" or the "PROSPECTUS", as
applicable, except that, if the Basic Prospectus is amended or supplemented on
or prior to the date of the Preliminary Prospectus Supplement or the date on
which the Prospectus Supplement is first filed pursuant to Rule 424, the terms
"PRELIMINARY PROSPECTUS" and "PROSPECTUS" shall refer to the Basic Prospectus as
so amended or supplemented and as supplemented by the Preliminary Prospectus
Supplement or the Prospectus Supplement, as applicable. Any reference herein to
the terms "AMENDMENT" or "SUPPLEMENT" with respect to the Prospectus or any
Preliminary Prospectus shall be deemed to refer to and include any documents
filed with the Commission under the Exchange Act after the date the Prospectus
is filed with the Commission, or the date of such Preliminary Prospectus, as the
case may be, and incorporated therein by reference pursuant to Item 12 of Form
S-3 under the Securities Act.

            Capitalized terms not otherwise defined in this Underwriting
Agreement (the "AGREEMENT") shall have the meanings specified therefor in the
Pass Through Trust Agreement, in the Note Purchase Agreement or in the
Intercreditor Agreement; PROVIDED that, as used in this Agreement, the term
"OPERATIVE AGREEMENTS" shall mean the Deposit Agreement, the Escrow Agreement,
the Intercreditor Agreement, the Liquidity Facilities, the Guarantee Agreement,
the Pass Through Trust Agreement and the Financing Agreements (as defined in the
Note Purchase Agreement).

            1. REPRESENTATIONS AND WARRANTIES. (a) The Company represents and
warrants to, and agrees with each Underwriter that:

            (i) The Company meets the requirements for use of Form S-3 under the
      Securities Act; the Registration Statement has become effective; and, on
      the original effective date of the Registration Statement, the
      Registration Statement complied in all material respects with the
      requirements of the Securities Act. On the original effective date of the
      Registration Statement, the Registration Statement did not include any
      untrue statement of a material fact or omit to state any material fact
      required to be stated therein or necessary to make the statements therein
      not misleading, and on the date hereof and on the Closing Date, the
      Prospectus, as amended and supplemented, if the Company shall have
      furnished any amendment or supplement thereto, does not and will not
      include an untrue statement of a material fact and does not and will not
      omit to state a material fact necessary in order to make the statements
      therein, in the light of the circumstances under which they were made, not
      misleading. The preceding sentence does not apply to (x) statements in or
      omissions from the Registration Statement, the Preliminary Prospectus or
      the Prospectus based upon (A) written information furnished to the Company
      by any Underwriter expressly for use therein ("UNDERWRITER INFORMATION"),
      (B) the Embraer Information (as defined in Annex I) or (C) the Depositary



      Information (as hereinafter defined) or (y) statements or omissions in
      that part of each Registration Statement which shall constitute the
      Statement of Eligibility of the Trustee under the Trust Indenture Act of
      1939, as amended (the "TRUST INDENTURE ACT"), on Form T-1.

            (ii) The documents incorporated by reference in the Prospectus
      pursuant to Item 12 of Form S-3 under the Securities Act, at the time they
      were or hereafter, during the period mentioned in Section 4(a) hereof, are
      filed with the Commission, complied or will comply, as the case may be, in
      all material respects with the requirements of the Exchange Act.

            (iii) The Company has been duly incorporated and is an existing
      corporation in good standing under the laws of the State of Delaware, with
      corporate power and authority to own, lease and operate its property and
      to conduct its business as described in the Prospectus; and the Company is
      duly qualified to do business as a foreign corporation in good standing in
      all other jurisdictions in which its ownership or lease of property or the
      conduct of its business requires such qualification, except where the
      failure to be so qualified would not have a material adverse effect on the
      condition (financial or otherwise), business, properties or results of
      operations of the Company and its consolidated subsidiaries taken as a
      whole (a "CONTINENTAL MATERIAL ADVERSE EFFECT").

            (iv) Each of Continental Micronesia, Inc. and Air Micronesia Inc.
      (together, the "SUBSIDIARIES") has been duly incorporated and is an
      existing corporation in good standing under the laws of the jurisdiction
      of its incorporation, with corporate power and authority to own, lease and
      operate its properties and to conduct its business as described in the
      Prospectus; and each Subsidiary is duly qualified to do business as a
      foreign corporation in good standing in all other jurisdictions in which
      its ownership or lease of property or the conduct of its business requires
      such qualification, except where the failure to be so qualified would not
      have a Continental Material Adverse Effect; all of the issued and
      outstanding capital stock of each Subsidiary has been duly authorized and
      validly issued and is fully paid and nonassessable; and, except as
      described in the Prospectus, each Subsidiary's capital stock owned by the
      Company, directly or through subsidiaries, is owned free from liens,
      encumbrances and defects.

            (v) Except as described in the Prospectus, the Company is not in
      default in the performance or observance of any obligation, agreement,
      covenant or condition contained in any contract, indenture, mortgage, loan
      agreement, note, lease or other instrument to which it is a party or by
      which it may be bound or to which any of its properties may be subject,
      except for such defaults that would not have a Continental Material
      Adverse Effect. The execution, delivery and performance of this Agreement
      and the Operative Agreements to which the Company is or will be a party
      and the consummation of the transactions contemplated herein and therein
      have been duly authorized by all necessary corporate action of the Company
      and will not result in any breach of any of the terms, conditions or
      provisions of, or constitute a default under, or result in the creation or
      imposition of any lien, charge or encumbrance (other than any lien, charge
      or encumbrance created under any Operative Agreement) upon any property or
      assets of the Company pursuant to any indenture, loan agreement, contract,



      mortgage, note, lease or other instrument to which the Company is a party
      or by which the Company may be bound or to which any of the property or
      assets of the Company is subject, which breach, default, lien, charge or
      encumbrance, individually or in the aggregate, would have a Continental
      Material Adverse Effect, nor will any such execution, delivery or
      performance result in any violation of the provisions of the charter or
      by-laws of the Company or any statute, any rule, regulation or order of
      any governmental agency or body or any court having jurisdiction over the
      Company.

            (vi) No consent, approval, authorization, or order of, or filing
      with, any governmental agency or body or any court is required for the
      valid authorization, execution and delivery by the Company of this
      Agreement and the Operative Agreements to which it is or will be a party
      and for the consummation of the transactions contemplated herein and
      therein, except (x) such as may be required under the Securities Act, the
      Trust Indenture Act, the securities or "blue sky" or similar laws of the
      various states and of foreign jurisdictions or rules and regulations of
      the National Association of Securities Dealers, Inc., and (y) filings or
      recordings with the Federal Aviation Administration (the "FAA") and under
      the UCC or other laws in effect in any applicable jurisdiction governing
      the perfection of security interests, which filings or recordings referred
      to in this clause (y), with respect to any particular set of Financing
      Agreements, shall have been made, or duly presented for filing or
      recordation, or shall be in the process of being duly filed or filed for
      recordation, on or prior to the applicable "Closing Date", as defined in
      such Financing Agreements (the "FUNDING DATE").

            (vii) This Agreement has been duly executed and delivered by the
      Company and the Operative Agreements to which the Company will be a party
      will be duly executed and delivered by the Company on or prior to the
      Closing Date or the applicable Funding Date, as the case may be.

            (viii) The Operative Agreements to which the Company is or will be a
      party, when duly executed and delivered by the Company, assuming that such
      Operative Agreements have been duly authorized, executed and delivered by,
      and constitute the legal, valid and binding obligations of, each other
      party thereto, will constitute valid and binding obligations of the
      Company enforceable in accordance with their terms, except (w) as
      enforcement thereof may be limited by bankruptcy, insolvency (including,
      without limitation, all laws relating to fraudulent transfers),
      reorganization, moratorium or other similar laws now or hereafter in
      effect relating to creditors' rights generally, (x) as enforcement thereof
      is subject to general principles of equity (regardless of whether
      enforcement is considered in a proceeding in equity or at law), (y) that
      the enforceability of the Leases may also be limited by applicable laws
      which may affect the remedies provided therein but which do not affect the
      validity of the Leases or make such remedies inadequate for the practical
      realization of the benefits intended to be provided thereby and (z) with
      respect to indemnification and contribution provisions, as enforcement
      thereof may be limited by applicable law. The Basic Agreement as executed
      is substantially in the form filed as an exhibit to the Company's current
      report on Form 8-K dated September 25, 1997 and has been duly qualified
      under the Trust Indenture Act.




            (ix) The consolidated financial statements of the Company
      incorporated by reference in the Prospectus, together with the related
      notes thereto, present fairly in all material respects the financial
      position of the Company and its consolidated subsidiaries at the dates
      indicated and the consolidated results of operations and cash flows of the
      Company and its consolidated subsidiaries for the periods specified. Such
      financial statements have been prepared in conformity with generally
      accepted accounting principles applied on a consistent basis throughout
      the periods involved, except as otherwise stated therein and except that
      unaudited financial statements do not have all required footnotes. The
      financial statement schedules, if any, incorporated by reference in the
      Prospectus present the information required to be stated therein.

            (x) The Company is a "citizen of the United States" within the
      meaning of Section 40102(a)(15) of Title 49 of the United States Code, as
      amended, and holds an air carrier operating certificate issued pursuant to
      Chapter 447 of Title 49 of the United States Code, as amended, for
      aircraft capable of carrying 10 or more individuals or 6,000 pounds or
      more of cargo. All of the outstanding shares of capital stock of the
      Company have been duly authorized and validly issued and are fully paid
      and non-assessable.

            (xi) Except as disclosed in the Prospectus, the Company and the
      Subsidiaries have good and marketable title to all real properties and all
      other properties and assets owned by them, in each case free from liens,
      encumbrances and defects except where the failure to have such title would
      not have a Continental Material Adverse Effect; and except as disclosed in
      the Prospectus, the Company and the Subsidiaries hold any leased real or
      personal property under valid and enforceable leases with no exceptions
      that would have a Continental Material Adverse Effect.

            (xii) Except as disclosed in the Prospectus, there is no action,
      suit or proceeding before or by any governmental agency or body or court,
      domestic or foreign, now pending or, to the knowledge of the Company,
      threatened against the Company or any of its subsidiaries or any of their
      respective properties that individually (or in the aggregate in the case
      of any class of related lawsuits), could reasonably be expected to result
      in a Continental Material Adverse Effect or that could reasonably be
      expected to materially and adversely affect the consummation of the
      transactions contemplated by this Agreement or the Operative Agreements.

            (xiii) Except as disclosed in the Prospectus, no labor dispute with
      the employees of the Company or any subsidiary exists or, to the knowledge
      of the Company, is imminent that could reasonably be expected to have a
      Continental Material Adverse Effect.

            (xiv) Each of the Company and the Subsidiaries has all necessary
      consents, authorizations, approvals, orders, certificates and permits of
      and from, and has made all declarations and filings with, all federal,
      state, local and other governmental authorities, all self-regulatory
      organizations and all courts and other tribunals, to own, lease, license
      and use its properties and assets and to conduct its business in the



      manner described in the Prospectus, except to the extent that the failure
      to so obtain, declare or file would not have a Continental Material
      Adverse Effect.

            (xv) Except as disclosed in the Prospectus, (x) neither the Company
      nor any of the Subsidiaries is in violation of any statute, rule,
      regulation, decision or order of any governmental agency or body or any
      court, domestic or foreign, relating to the use, disposal or release of
      hazardous or toxic substances (collectively, "ENVIRONMENTAL LAWS"), owns
      or operates any real property contaminated with any substance that is
      subject to any environmental laws, or is subject to any claim relating to
      any environmental laws, which violation, contamination, liability or claim
      individually or in the aggregate is reasonably expected to have a
      Continental Material Adverse Effect, and (y) the Company is not aware of
      any pending investigation which might lead to such a claim that is
      reasonably expected to have a Continental Material Adverse Effect.

            (xvi) The accountants that examined and issued an auditors' report
      with respect to the consolidated financial statements of the Company and
      the financial statement schedules of the Company, if any, included or
      incorporated by reference in the Registration Statement are independent
      public accountants within the meaning of the Securities Act.

            (xvii) The Company is not an "investment company", or an entity
      "controlled" by an "investment company", within the meaning of the
      Investment Company Act of 1940, as amended (the "INVESTMENT COMPANY ACT"),
      required to register under the Investment Company Act.

            (xviii) No Appraiser is an affiliate of the Company or, to the
      knowledge of the Company, has a substantial interest, direct or indirect,
      in the Company. To the knowledge of the Company, none of the officers and
      directors of any of such Appraisers is connected with the Company or any
      of its affiliates as an officer, employee, promoter, underwriter, trustee,
      partner, director or person performing similar functions.

            (xix) The Company (A) makes and keeps books, records and accounts,
      which, in reasonable detail, accurately and fairly reflect the
      transactions and dispositions of the material assets of the Company and
      its consolidated subsidiaries and (B) maintains a system of internal
      accounting controls sufficient to provide reasonable assurances that (1)
      transactions are executed in accordance with management's general or
      specific authorization; (2) transactions are recorded as necessary: (x) to
      permit preparation of financial statements in conformity with generally
      accepted accounting principles or any other criteria applicable to such
      statements and (y) to maintain accountability for assets; (3) access to
      material assets is permitted only in accordance with management's general
      or specific authorization; and (4) the recorded accountability for
      material assets is compared with the existing material assets at
      reasonable intervals and appropriate action is taken with respect to any
      differences.

            (b) The Depositary represents and warrants to, and agrees with, each
Underwriter and the Company that:




            (i) The information pertaining to the Depositary set forth under the
      caption "Description of the Deposit Agreement -- Depositary" (the
      "DEPOSITARY INFORMATION") in the Prospectus, as amended and supplemented,
      if the Company shall have furnished any amendment or supplement thereto,
      does not, and will not as of the Closing Date, contain any untrue
      statement of a material fact.

            (ii) The Depositary is duly organized and validly existing as a
      joint stock company ("Aktiengesellschaft") under the laws of the Federal
      Republic of Germany and is duly qualified to conduct banking business in
      the State of New York through its New York branch, with corporate power
      and authority to own, lease and operate its property, to conduct its
      business as described in the Depositary Information and to enter into and
      perform its obligations under this Agreement and the Deposit Agreement.

            (iii) No consent, approval, authorization, or order of, or filing
      with any governmental agency or body or any court is required for the
      valid authorization, execution and delivery by the Depositary of this
      Agreement and the Deposit Agreement and for the consummation of the
      transactions contemplated herein and therein, except such as may have been
      obtained.

            (iv) The execution and delivery by the Depositary of this Agreement
      and the Deposit Agreement and the consummation of the transactions
      contemplated herein and therein have been duly authorized by the
      Depositary and will not violate any law, governmental rule or regulation
      or any of its organizational documents or any order, writ, injunction or
      decree of any court or governmental agency against it or the provisions of
      any indenture, loan agreement, contract or other instrument to which it is
      a party or is bound.

            (v) This Agreement has been duly executed and delivered by the
      Depositary, and the Deposit Agreement will be duly executed and delivered
      by the Depositary on or prior to the Closing Date.

            (vi) The Deposit Agreement, when duly executed and delivered by the
      Depositary, assuming that such Deposit Agreement has been duly authorized,
      executed and delivered by, and constitutes the legal, valid and binding
      obligations of, the Escrow Agent, will constitute the legal, valid and
      binding obligations of the Depositary enforceable in accordance with its
      terms, except (x) as enforcement thereof may be limited by bankruptcy,
      insolvency (including, without limitation, all laws relating to fraudulent
      transfers), reorganization, moratorium or other similar laws now or
      hereinafter in effect relating to creditors' rights generally and (y) as
      enforcement thereof is subject to general principles of equity (regardless
      of whether enforcement is considered in a proceeding in equity or at law).

            (c) Embraer represents and warrants to, and agrees with, each
Underwriter and the Company that:




            (i) (x) As of the date hereof, the Registration Statement does not
      include any untrue statement of a material fact or omit to state any
      material fact required to be stated therein or necessary to make the
      statements therein not misleading, (y) as of its date, the Preliminary
      Prospectus did not include any untrue statement of a material fact or omit
      to state any material fact required to be stated therein or necessary to
      make the statements therein not misleading and (z) on the date hereof and
      on the Closing Date, the Prospectus, as amended and supplemented, if the
      Company shall have furnished any amendment or supplement thereto, does not
      and will not include an untrue statement of a material fact and does not
      and will not omit to state a material fact necessary in order to make the
      statements therein, in the light of the circumstances under which they
      were made, not misleading. The preceding sentence does not apply to
      statements in or omissions from the Registration Statement, the
      Preliminary Prospectus or the Prospectus based upon (A) Continental
      Information (as defined in Annex I), (B) Underwriter Information or (C)
      the Depositary Information.

            (ii) Each of Embraer and Refine, Inc. ("REFINE") has been duly
      organized and is a corporation validly existing in good standing under the
      laws of its jurisdiction of incorporation or organization, with corporate
      power and authority to own, lease and operate its properties, conduct its
      business as currently conducted and perform its obligations under this
      Agreement and under the Operative Agreements to which it is or will be a
      party.

            (iii) No consent, approval, authorization, or order of, or filing
      with any governmental agency or body or any court is required for the
      valid authorization, execution and delivery by Embraer of this Agreement
      or by Embraer or Refine of the Operative Agreements to which either
      Embraer or Refine is or will be a party and for the performance of their
      respective obligations hereunder and thereunder, as applicable, except
      such as may have been obtained.

            (iv) The execution and delivery by Embraer of this Agreement and by
      Embraer and Refine of the Operative Agreements to which either Embraer or
      Refine is or will be a party and the performance of their respective
      obligations hereunder and thereunder have been duly authorized by Embraer
      and Refine, as applicable, and will not violate (w) any law, governmental
      rule or regulation, (x) any of their respective organizational documents,
      (y) any order, writ, injunction or decree of any court or governmental
      agency against either Embraer or Refine, as applicable, or (z) except to
      the extent that any such violation would not have a material adverse
      effect on the condition (financial or otherwise), business, properties or
      results of operations of Embraer and its consolidated subsidiaries taken
      as a whole or Refine, as applicable, the provisions of any indenture, loan
      agreement, contract or other instrument to which either Embraer or Refine
      is a party or is bound.

            (v) This Agreement has been duly executed and delivered by Embraer.

            (vi) (1) The Operative Agreements to which Embraer is or will be a
      party, when duly executed and delivered by Embraer, assuming that such



      Operative Agreements have been duly authorized, executed and delivered by,
      and constitute the legal, valid and binding obligations of, each other
      party thereto, will constitute valid and binding obligations of Embraer
      enforceable in accordance with their terms and (2) the Operative
      Agreements to which Refine is or will be a party, when duly executed and
      delivered by Refine, assuming that such Operative Agreements have been
      duly authorized, executed and delivered by, and constitute the legal,
      valid and binding obligations of, each other party thereto, will
      constitute valid and binding obligations of Refine enforceable in
      accordance with their terms, except, in the case of both (1) and (2), (x)
      as enforcement thereof may be limited by bankruptcy, insolvency
      (including, without limitation, all laws relating to fraudulent
      transfers), reorganization, moratorium or other similar laws now or
      hereafter in effect relating to creditors' rights generally, (y) as
      enforcement thereof is subject to general principles of equity (regardless
      of whether enforcement is considered in a proceeding in equity or at law)
      and (z) with respect to indemnification and contribution provisions, as
      enforcement thereof may be limited by applicable law.

            (vii) On or prior to the Closing Date, the issuance of the Offered
      Certificates will be duly authorized by the Trustee. When duly executed,
      authenticated, issued and delivered in the manner provided for in the Pass
      Through Trust Agreement and sold and paid for as provided in this
      Agreement, the Offered Certificates will be legally and validly issued and
      will be entitled to the benefits of the Pass Through Trust Agreement; and
      when executed, authenticated, issued and delivered in the manner provided
      for in the Escrow Agreement, the Escrow Receipts will be legally and
      validly issued and will be entitled to the benefits of the Escrow
      Agreement.

            (viii) The Class A Trust is not an "investment company", or an
      entity "controlled" by an "investment company", within the meaning of the
      Investment Company Act, required to register under the Investment Company
      Act; and after giving effect to the offering and sale of the Offered
      Certificates and the application of the proceeds thereof as described in
      the Prospectus, the Class A Trust will not be, nor will the escrow
      arrangement contemplated by the Escrow Agreement result in the creation
      of, an "investment company", or an entity "controlled" by an "investment
      company", as defined in the Investment Company Act, in each case required
      to register under the Investment Company Act.

            (ix) The Offered Certificates, this Agreement and the Operative
      Agreements will conform in all material respects to the descriptions
      thereof contained in the Prospectus (other than, in the case of the
      Financing Agreements, as described in the Prospectus).

            (x) The information provided by Embraer to each of Aviation
      Specialists Group, Inc. ("ASG"), AvSolutions ("AVS") and BK Associates
      (together with ASG and AVS, the "APPRAISERS") for use by the Appraisers in
      preparation of their respective reports relating to the Aircraft each
      dated as of June 11, 2004, taken as a whole with respect to each such
      report, did not contain an untrue statement of material fact or omit to
      state a material fact necessary to make such information not misleading.




            (d) The parties agree that any certificate signed by a duly
authorized officer of the Company and delivered to an Underwriter, or to counsel
for the Underwriters, on the Closing Date and in connection with this Agreement
or the offering of the Offered Certificates, shall be deemed a representation
and warranty by (and only by) the Company to the Underwriters as to the matters
covered thereby.

            2. PURCHASE, SALE AND DELIVERY OF OFFERED CERTIFICATES. (a) On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and the conditions herein set forth, the Company agrees to
cause the Trustee to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Trustee, at a purchase price of
100% of the principal amount thereof, the aggregate principal amount of Offered
Certificates set forth opposite the name of such Underwriter in Schedule II.
Concurrently with the issuance of the Offered Certificates, the Escrow Agent
shall issue and deliver to the Trustee the Escrow Receipts in accordance with
the terms of the Escrow Agreement, which Escrow Receipts shall be attached to
the related Offered Certificates.

            (b) The Company is advised by you that the Underwriters propose to
make a public offering of the Offered Certificates as set forth in the
Prospectus Supplement as soon after this Agreement has been entered into as in
your judgment is advisable. The Company is further advised by you that the
Offered Certificates are to be offered to the public initially at 100% of their
principal amount -- the public offering price -- plus accrued interest, if any,
and to certain dealers selected by the Underwriters at concessions not in excess
of the concessions set forth in the Prospectus, and that the Underwriters may
allow, and such dealers may reallow, concessions not in excess of the
concessions set forth in the Prospectus to certain other dealers.

            (c) As underwriting commission and other compensation to the
Underwriters for their respective commitments and obligations hereunder in
respect of the Offered Certificates, including their respective undertakings to
distribute the Offered Certificates, Embraer will pay to Citigroup for the
accounts of the Underwriters the amount set forth in Schedule III hereto, which
amount shall be allocated among the Underwriters in the manner determined by
you. Such payment will be made on the Closing Date simultaneously with the
issuance and sale of the Offered Certificates (with attached Escrow Receipts) to
the Underwriters. Payment of such compensation shall be made by Federal funds
check or by wire transfer of immediately available funds.

            (d) Delivery of and payment for the Offered Certificates (with
attached Escrow Receipts) shall be made at the offices of Hughes Hubbard & Reed
LLP at One Battery Park Plaza, New York, New York 10004 at 10:00 A.M. on June
29, 2004 or such other date, time and place as may be agreed upon by the Company
and you (such date and time of delivery and payment for the Offered Certificates
(with attached Escrow Receipts) being herein called the "CLOSING DATE").
Delivery of the Offered Certificates (with attached Escrow Receipts) issued by
the Class A Trust shall be made to Citigroup's account at The Depository Trust
Company ("DTC") for the respective accounts of the several Underwriters against
payment by the Underwriters of the purchase price thereof. Payment for the
Offered Certificates issued by the Class A Trust and the related Escrow Receipts
attached thereto shall be made by the Underwriters by wire transfer of
immediately available funds to the accounts and in the manner specified in the



Escrow Agreement (PROVIDED, that if the Company notifies you that a Funding Date
is occurring on the Closing Date, a portion of such payment in the amount
specified by the Company shall be paid to the accounts and in the manner
specified in the related Participation Agreement). The Offered Certificates
(with attached Escrow Receipts) issued by the Class A Trust shall be in the form
of one or more fully registered global Offered Certificates, and shall be
deposited with the Trustee as custodian for DTC and registered in the name of
Cede & Co.

            (e) The Company agrees to have the Offered Certificates (with
attached Escrow Receipts) available for inspection and checking by you in New
York, New York not later than 1:00 P.M. on the business day prior to the Closing
Date.

            (f) It is understood that each Underwriter has authorized Citigroup,
on its behalf and for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Offered Certificates (with attached
Escrow Receipts) that it has agreed to purchase. Citigroup, individually and not
as a representative, may (but shall not be obligated to) make payment of the
purchase price for the Offered Certificates to be purchased by any Underwriter
whose check or checks shall not have been received by the Closing Date.

            3. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations
of the Underwriters to purchase and pay for the Offered Certificates pursuant to
this Agreement are subject to the following conditions:

            (a) On the Closing Date, no stop order suspending the effectiveness
      of the Registration Statement shall have been issued under the Securities
      Act and no proceedings therefor shall have been instituted or threatened
      by the Commission.

            (b) On the Closing Date, you shall have received an opinion of
      Hughes Hubbard & Reed LLP, as counsel for the Company, dated the Closing
      Date, in form and substance reasonably satisfactory to you and
      substantially to the effect set forth in Exhibit A hereto.

            (c) On the Closing Date, you shall have received an opinion of the
      General Counsel of the Company, dated the Closing Date, in form and
      substance reasonably satisfactory to you and substantially to the effect
      set forth in Exhibit B hereto.

            (d) On the Closing Date, you shall have received an opinion of
      Richards, Layton & Finger, P.A., counsel for Wilmington Trust Company,
      individually and as Trustee, Subordination Agent and Paying Agent, dated
      the Closing Date, in form and substance reasonably satisfactory to you and
      substantially to the effect set forth in Exhibit C hereto.

            (e) On the Closing Date, you shall have received an opinion of Ray,
      Quinney & Nebeker, counsel for the Escrow Agent, dated the Closing Date,
      in form and substance reasonably satisfactory to you and substantially to
      the effect set forth in Exhibit D hereto.




            (f) On the Closing Date, you shall have received an opinion of
      in-house counsel for WestLB, as a Liquidity Provider, dated the Closing
      Date, in form and substance reasonably satisfactory to you and
      substantially to the effect set forth in Exhibit E hereto.

            (g) On the Closing Date, you shall have received an opinion of
      in-house counsel for CNAI, as a Liquidity Provider, and Citicorp, as the
      Liquidity Provider Guarantor, dated the Closing Date, in form and
      substance reasonably satisfactory to you and substantially to the effect
      set forth in Exhibit F hereto.

            (h) On the Closing Date, you shall have received an opinion of
      Milbank, Tweed, Hadley & McCloy LLP, special New York counsel to WestLB,
      as a Liquidity Provider, dated the Closing Date, in form and substance
      reasonably satisfactory to you and substantially to the effect set forth
      in Exhibit G hereto.

            (i) On the Closing Date, you shall have received an opinion of
      Milbank, Tweed, Hadley & McCloy LLP, special New York counsel to CNAI, as
      a Liquidity Provider, and Citicorp, as the Liquidity Provider Guarantor,
      dated the Closing Date, in form and substance reasonably satisfactory to
      you and substantially to the effect set forth in Exhibit H hereto.

            (j) On the Closing Date, you shall have received an opinion of
      in-house counsel for WestLB, as the Depositary, dated the Closing Date, in
      form and substance reasonably satisfactory to you and substantially to the
      effect set forth in Exhibit I hereto.

            (k) On the Closing Date, you shall have received an opinion of
      Milbank, Tweed, Hadley & McCloy LLP, special New York counsel for the
      Depositary, dated the Closing Date, in form and substance reasonably
      satisfactory to you and substantially to the effect set forth in Exhibit J
      hereto.

            (l) On the Closing Date, you shall have received an opinion of
      Katten Muchin Zavis Rosenman, special New York counsel for Embraer, dated
      the Closing Date, in form and substance reasonably satisfactory to you and
      substantially to the effect set forth in Exhibit K hereto.

            (m) On the Closing Date, you shall have received an opinion of
      Carlos Rocha Villela, Esq., Brazilian in-house counsel for Embraer, dated
      the Closing Date, in form and substance reasonably satisfactory to you and
      substantially to the effect set forth in Exhibit L hereto.

            (n) On the Closing Date, you shall have received an opinion of
      Milbank, Tweed, Hadley & McCloy LLP, counsel for the Underwriters, dated
      as of the Closing Date, with respect to the issuance and sale of the
      Offered Certificates, the Registration Statement, the Prospectus and other
      related matters as the Underwriters may reasonably require.




            (o) Subsequent to the execution and delivery of this Agreement,
      there shall not have occurred any change, or any development or event
      involving a prospective change, in the condition (financial or other),
      business, properties or results of operations of the Company and its
      subsidiaries considered as one enterprise that, in your judgment, is
      material and adverse and that makes it, in your judgment, impracticable to
      proceed with the completion of the public offering of the Offered
      Certificates on the terms and in the manner contemplated by the
      Prospectus.

            (p) You shall have received on the Closing Date a certificate, dated
      the Closing Date and signed by the President or any Vice President of the
      Company, to the effect that the representations and warranties of the
      Company contained in this Agreement are true and correct as of the Closing
      Date as if made on the Closing Date (except to the extent that they relate
      solely to an earlier date, in which case they shall be true and accurate
      as of such earlier date), that the Company has performed all its
      obligations to be performed hereunder on or prior to the Closing Date and
      that, subsequent to the execution and delivery of this Agreement, there
      shall not have occurred any material adverse change, or any development or
      event involving a prospective material adverse change, in the condition
      (financial or other), business, properties or results of operations of the
      Company and its subsidiaries considered as one enterprise, except as set
      forth in or contemplated by the Prospectus.

            (q) You shall have received from Ernst & Young LLP a letter, dated
      the date hereof, in form and substance satisfactory to you.

            (r) Subsequent to the execution and delivery of this Agreement and
      prior to the Closing Date, there shall not have been any downgrading in
      the rating accorded any of the Company's securities (except for any pass
      through certificates) by any "nationally recognized statistical rating
      organization", as such term is defined for purposes of Rule 436(g)(2)
      under the Securities Act, or any public announcement that any such
      organization has under surveillance or review, in each case for possible
      change, its ratings of any such securities other than pass through
      certificates (other than an announcement with positive implications of a
      possible upgrading, and no implication of a possible downgrading, of such
      rating).

            (s) Each of the Appraisers shall have furnished to the Underwriters
      a letter from such Appraiser, addressed to the Company and dated the
      Closing Date, confirming that such Appraiser and each of its directors and
      officers (i) is not an affiliate of the Company or any of its affiliates,
      (ii) does not have any substantial interest, direct or indirect, in the
      Company or any of its affiliates and (iii) is not connected with the
      Company or any of its affiliates as an officer, employee, promoter,
      underwriter, trustee, partner, director or person performing similar
      functions.

            (t) At the Closing Date, each of the Operative Agreements (other
      than the Financing Agreements) shall have been duly executed and delivered
      by each of the parties thereto; and the representations and warranties of
      the Company contained in each of such executed Operative Agreements shall



      be true and correct as of the Closing Date (except to the extent that they
      relate solely to an earlier date, in which case they shall be true and
      correct as of such earlier date) and the Underwriters shall have received
      a certificate of the President or a Vice President of the Company, dated
      as of the Closing Date, to such effect.

            (u) On the Closing Date, the Offered Certificates shall be rated (x)
      not lower than "BBB-" by Standard & Poor's Ratings Services, a division of
      The McGraw-Hill Companies, Inc., and (y) not lower than "Ba2" by Moody's
      Investors Service, Inc.

            (v) On the Closing Date, the representations and warranties of the
      Depositary contained in this Agreement shall be true and correct as if
      made on the Closing Date (except to the extent that they relate solely to
      an earlier date, in which case they shall be true and correct as of such
      earlier date).

            (w) You shall have received from Ernst & Young LLP a letter, dated
      the Closing Date, which meets the requirements of subsection (q) of this
      Section, except that the specified date referred to in such subsection
      will be a date not more than three business days prior to the Closing Date
      for the purposes of this subsection.

            (x) You shall have received on the Closing Date a certificate, dated
      the Closing Date and signed by the President or any Vice President of
      Embraer, to the effect that the representations and warranties of Embraer
      contained in this Agreement are true and correct as of the Closing Date as
      if made on the Closing Date (except to the extent that they relate solely
      to an earlier date, in which case they shall be true and accurate as of
      such earlier date) and that Embraer has performed all its obligations to
      be performed hereunder on or prior to the Closing Date.

            The Company or Embraer, as applicable, will furnish the Underwriters
with such conformed copies of such opinions, certificates, letters and documents
as the Underwriters reasonably request.

            4. CERTAIN COVENANTS OF THE COMPANY. The Company covenants with each
Underwriter as follows:

            (a) During the period described in the following sentence of this
      Section 4(a), the Company shall advise you promptly of any proposal to
      amend or supplement the Registration Statement or the Prospectus (except
      by documents filed under the Exchange Act) and will not effect such
      amendment or supplement (except by documents filed under the Exchange Act)
      without the consent of each Underwriter, which consent will not be
      unreasonably withheld. If, at any time after the public offering of the
      Offered Certificates as the Prospectus is required by law to be delivered
      in connection with sales of the Offered Certificates by an Underwriter or
      a dealer, any event shall occur as a result of which it is necessary to
      amend the Registration Statement or amend or supplement the Prospectus in
      order to make the statements therein, in the light of the circumstances
      when the Prospectus is delivered to a purchaser, not misleading in any
      material respect, or if it is necessary to amend the Registration
      Statement or amend or supplement the Prospectus to comply with law, the



      Company shall prepare and furnish, at Embraer's expense, to the
      Underwriters and to the dealers (whose names and addresses the
      Underwriters will furnish to the Company) to which Offered Certificates
      may have been sold by the Underwriters and to any other dealers upon
      request, either amendments or supplements to the Prospectus so that the
      statements in the Prospectus as so amended or supplemented will not, in
      the light of the circumstances when the Prospectus is delivered to a
      purchaser, be misleading in any material respect or amendments or
      supplements to the Registration Statement or the Prospectus so that the
      Registration Statement or the Prospectus, as so amended or supplemented,
      will comply with law and cause such amendments or supplements to be filed
      promptly with the Commission.

            (b) During the period mentioned in paragraph (a) above, the Company
      shall notify each Underwriter immediately of (i) the effectiveness of any
      amendment to the Registration Statement, (ii) the transmittal to the
      Commission for filing of any supplement to the Prospectus or any document
      that would as a result thereof be incorporated by reference in the
      Prospectus, (iii) the receipt of any comments from the Commission with
      respect to the Registration Statement, the Prospectus or the Prospectus
      Supplement, (iv) any request by the Commission to the Company for any
      amendment to the Registration Statement or any supplement to the
      Prospectus or for additional information relating thereto or to any
      document incorporated by reference in the Prospectus and (v) receipt by
      the Company of any notice of the issuance by the Commission of any stop
      order suspending the effectiveness of the Registration Statement, the
      suspension of the qualification of the Offered Certificates for offering
      or sale in any jurisdiction, or the institution or threatening of any
      proceeding for any of such purposes; and the Company agrees to use every
      reasonable effort to prevent the issuance of any such stop order and, if
      any such order is issued, to obtain the lifting thereof at the earliest
      possible moment and the Company shall (subject to the proviso to Section
      4(e)) endeavor, in cooperation with the Underwriters, to prevent the
      issuance of any such stop order suspending such qualification and, if any
      such order is issued, to obtain the lifting thereof at the earliest
      possible moment.

            (c) During the period mentioned in paragraph (a) above, the Company
      will furnish to each of the Underwriters as many conformed copies of the
      Registration Statement (as originally filed) and all amendments and
      supplements to such documents (excluding all exhibits and documents filed
      therewith or incorporated by reference therein) and as many conformed
      copies of all consents and certificates of experts, in each case as soon
      as available and in such quantities as each of the Underwriters reasonably
      requests.

            (d) Promptly following the execution of this Agreement, the Company
      will prepare a Prospectus Supplement that complies with the Securities Act
      and that sets forth the principal amount of the Offered Certificates and
      their terms (including, without limitation, terms of the Escrow Receipts
      attached to the Offered Certificates) not otherwise specified in the
      Preliminary Prospectus Supplement or the Basic Prospectus included in the
      Registration Statement, the name of each Underwriter and the principal
      amount of the Offered Certificates that each severally has agreed to



      purchase, the name of each Underwriter, if any, acting as representative
      of the Underwriters in connection with the offering, the price at which
      the Offered Certificates are to be purchased by the Underwriters from the
      Trustee, any initial public offering price, any selling concession and
      reallowance and any delayed delivery arrangements, and such other
      information as you and the Company deem appropriate in connection with the
      offering of the Offered Certificates. The Company will timely transmit
      copies of the Prospectus Supplement to the Commission for filing pursuant
      to Rule 424 under the Securities Act.

            (e) The Company shall, in cooperation with the Underwriters,
      endeavor to arrange for the qualification of the Offered Certificates for
      offer and sale under the applicable securities or "blue sky" laws of such
      jurisdictions in the United States as you reasonably designate and will
      endeavor to maintain such qualifications in effect so long as required for
      the distribution of the Offered Certificates; PROVIDED that the Company
      shall not be required to (i) qualify as a foreign corporation or as a
      dealer in securities, (ii) file a general consent to service of process or
      (iii) subject itself to taxation in any such jurisdiction.

            (f) During the period of ten years after the Closing Date, the
      Company will promptly furnish to each of the Underwriters, upon request,
      copies of all Annual Reports on Form 10-K and any definitive proxy
      statement of the Company filed with the Commission; PROVIDED THAT
      providing a website address at which such Annual Reports and any such
      definitive proxy statements may be accessed will satisfy this clause (f).

            (g) Between the date of this Agreement and the Closing Date, the
      Company shall not, without the prior written consent of the Underwriters,
      offer, sell, or enter into any agreement to sell (as public debt
      securities registered under the Securities Act (other than the Offered
      Certificates) or as debt securities which may be resold in a transaction
      exempt from the registration requirements of the Securities Act in
      reliance on Rule 144A thereunder and which are marketed through the use of
      a disclosure document containing substantially the same information as a
      prospectus for similar debt securities registered under the Securities
      Act), any equipment notes, pass through certificates, equipment trust
      certificates or equipment purchase certificates secured by aircraft owned
      or leased by the Company (or rights relating thereto).

            5. INDEMNIFICATION AND CONTRIBUTION. (a) The Company and Embraer
agree that the Company or Embraer, as set forth in provisos (ii) and (iii)
below, will indemnify and hold harmless each Underwriter, and each Person, if
any, who controls such Underwriter within the meaning of either Section 15 of
the Securities Act or Section 20 of the Exchange Act from and against any and
all losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred by any Underwriter or any such
controlling person in connection with defending or investigating any such action
or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
the Preliminary Prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,



except insofar as such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or omission based
upon Depositary Information or Underwriter Information; PROVIDED, HOWEVER, that
(i) the foregoing indemnity agreement with respect to the Preliminary Prospectus
shall not inure to the benefit of any Underwriter from whom the person asserting
any such losses, claims, damages or liabilities purchased the Offered
Certificates, or to the benefit of any person controlling such Underwriter, if a
copy of the Prospectus (as then amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) was not sent or given by
or on behalf of such Underwriter to such person, if required by law so to have
been delivered, at or prior to the written confirmation of the sale of such
Offered Certificates to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such losses, claims,
damages or liabilities unless such failure to deliver the Prospectus was a
result of noncompliance by the Company with its delivery requirements set forth
in Section 4(a), (ii) the Company shall be obligated under this Section 5 only
with respect to the Continental Information and then only to the extent that a
court of competent jurisdiction makes a Final Determination that such losses,
claims, damages or liabilities arise out of or are caused by an untrue statement
of a material fact contained in or omission of a material fact from the
Continental Information (such Final Determination, an "ADVERSE FINAL
DETERMINATION"), and (iii) Embraer shall be obligated under this Section 5 to
the extent that the Company is not obligated pursuant to the foregoing clause
(ii). "FINAL DETERMINATION" shall mean a determination which has not been stayed
or reversed and which has become final and non-appealable in accordance with
applicable law.

            The provisions of this Section 5 shall not affect any agreements
between the Company, Embraer or any of their respective affiliates for the
sharing of, or otherwise allocating, costs and expenses.

            (b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless each of Embraer and the Company, each of their respective
directors, each of the officers of the Company who signed the Registration
Statement and each person, if any, who controls the Company or Embraer, as the
case may be, within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, to the same extent as the foregoing indemnity
from each of the Company and Embraer to such Underwriter but only with reference
to the Underwriter Information provided by such Underwriter and without giving
effect to the proviso in Section 5(a).

            (c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either paragraph (a) or (b) above, such
person (the "INDEMNIFIED PARTY") shall promptly notify the person against whom
such indemnity may be sought (the "INDEMNIFYING PARTY"), and, if such proceeding
involves any Continental Information, the Company, in writing. The indemnifying
party, upon request of the indemnified party, shall, and the indemnifying party,
or, if such proceeding involves any Continental Information, the Company, may
elect (any election by the Company to supersede any election by Embraer) to,
retain counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party (or the Company as the
case may be) may designate in such proceeding and the indemnifying party (or, if
the Company elects to designate counsel, Embraer) shall pay the fees and



disbursements of such counsel related to such proceeding (provided that if the
Company has elected to designate counsel in such proceeding and there is an
Adverse Final Determination in such proceeding, then the Company shall reimburse
Embraer for such fees and expenses of such counsel theretofore paid by it in the
same proportion as the Company is responsible for any judgment in such
proceeding pursuant to Section 5(a)). In any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to the
retention of such counsel, (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them, or
(iii) the indemnifying party shall have failed to retain counsel as required by
the prior sentence to represent the indemnified party within a reasonable amount
of time. It is understood that the indemnifying party shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the fees and expenses of more than one separate firm (in addition to any
local counsel) for all such indemnified parties and that all such fees and
expenses shall be reimbursed as they are incurred. Such firm shall be designated
in writing by you in the case of parties indemnified pursuant to paragraph (a)
above and by the Company after consultation with Embraer in the case of parties
indemnified pursuant to paragraph (b) above. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested in writing an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
and third sentences of this paragraph, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 90 days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement, unless such fees and
expenses are being disputed in good faith. The indemnifying party (or, if such
proceeding concerns Continental Information, the Company) at any time may,
subject to the last sentence of this Section 5(c), settle or compromise any
proceeding described in this paragraph at the expense of the indemnifying party
(provided that the Company may not so effect any such settlement or compromise
unless either (x) Embraer has consented thereto, which consent shall not be
unreasonably withheld or delayed or (y) the Company agrees in its discretion
that such settlement or compromise shall be at its expense). For the avoidance
of doubt, the parties acknowledge and agree that, unless and until (and then
only to the extent that) there is an Adverse Final Determination with respect to
any proceeding described in this paragraph, the "indemnifying party" with
respect to such proceeding (to the extent that such proceeding involves
Continental Information and indemnification is otherwise available under Section
5(a)) shall be Embraer and not the Company, notwithstanding the Company's rights
to designate counsel, and effect a settlement or compromise, with respect to
such proceeding. No indemnifying party shall (and, if such proceeding concerns
Continental Information, the Company shall not), without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified



party, unless such settlement (i) includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such proceeding and (ii) does not include a statement as to, or an admission of,
fault, culpability or a failure to act by or on behalf of an indemnified party.

            (d) To the extent the indemnification provided for in paragraph (a)
or (b) of this Section 5 is required to be made but is unavailable to an
indemnified party or insufficient in respect of any losses, claims, damages or
liabilities, then the applicable indemnifying party under such paragraph, in
lieu of indemnifying such indemnified party thereunder, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company or Embraer, as the case
may be, on the one hand, and the Underwriters, on the other hand, from the
offering of such Offered Certificates or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company or Embraer, as the case may be,
on the one hand and the Underwriters on the other hand in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by Embraer on the one hand and the Underwriters on
the other hand in connection with the offering of such Offered Certificates
shall be deemed to be in the same respective proportions as the proceeds from
the offering of such Offered Certificates received by the Class A Trust (before
deducting expenses) less total underwriting discounts and commissions received
by the Underwriters, and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth on the cover of the
Prospectus, bear to the aggregate public offering price of such Offered
Certificates (it being acknowledged that the Company shall be deemed for
purposes of this paragraph to have received no benefits from the offering). The
relative fault of the Company or Embraer, as the case may be, on the one hand
and of the Underwriters on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
Continental Information, in the case of the Company, other information supplied
by the Company or Embraer, as the case may be, in the case of Embraer, or
Underwriter Information, in the case of the Underwriters, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Underwriters' respective obligations to
contribute pursuant to this Section 5(d) are several in proportion to the
respective principal amount of Offered Certificates they have purchased
hereunder, and not joint.

            (e) The Company, Embraer and the Underwriters agree that it would
not be just or equitable if contribution pursuant to this Section 5 were
determined by PRO RATA allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d) above. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in paragraph (d) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 5, no Underwriter shall be required to contribute any



amount in excess of the amount by which the total price at which the Offered
Certificates underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages that such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The indemnity and contribution provisions contained in this
Section 5 and the representations and warranties of the Company and Embraer
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter or
by or on behalf of either the Company or Embraer, their respective officers or
directors or any person controlling the Company or Embraer, and (iii) acceptance
of and payment for any of the Offered Certificates. The remedies provided for in
this Section 5 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in equity.

            6. DEFAULT OF UNDERWRITERS. If any Underwriter defaults in its
obligations to purchase Offered Certificates hereunder and the aggregate
principal amount of the Offered Certificates that such defaulting Underwriter
agreed but failed to purchase does not exceed 10% of the total principal amount
of the Offered Certificates, Citigroup may make arrangements satisfactory to the
Company for the purchase of such Offered Certificates by other persons,
including the non-defaulting Underwriter, but if no such arrangements are made
by the Closing Date, the non-defaulting Underwriter shall be obligated to
purchase the Offered Certificates that such defaulting Underwriter agreed but
failed to purchase. If any Underwriter so defaults and the aggregate principal
amount of the Offered Certificates with respect to which such default occurs
exceeds 10% of the total principal amount of the Offered Certificates and
arrangements satisfactory to Citigroup and the Company for purchase of such
Offered Certificates by other persons are not made within 36 hours after such
default, this Agreement will terminate without liability on the part of the
non-defaulting Underwriter, Embraer or the Company, except as provided in
Section 5. As used in this Agreement, the term "Underwriter" includes any person
substituted for an Underwriter under this Section. Nothing herein will relieve a
defaulting Underwriter from liability for its default.

            7. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, Embraer or their respective officers and of the
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any termination of this Agreement, any
investigation, or statement as to the results thereof, made by or on behalf of
any Underwriter, the Company, Embraer or any of their respective
representatives, officers or directors or any controlling person and will
survive delivery of and payment for the Offered Certificates. If for any reason
the purchase of the Offered Certificates by the Underwriters is not consummated,
Embraer shall remain responsible for the expenses to be paid or reimbursed by it
pursuant to Section 9 and the respective obligations of the Company, Embraer and
the Underwriters pursuant to Section 5 shall remain in effect. If the purchase
of the Offered Certificates by the Underwriters is not consummated for any
reason other than solely because of the occurrence of the termination of the
Agreement pursuant to Section 6 or 8, Embraer will reimburse the Underwriters
for all out-of-pocket expenses (including reasonable fees and disbursements of



counsel) reasonably incurred by them in connection with the offering of such
Offered Certificates and comply with its obligations under Section 9.

            8. TERMINATION. This Agreement shall be subject to termination by
notice given by you to the Company and Embraer, if (a) after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading generally
shall have been materially suspended or materially limited on or by, as the case
may be, any of the New York Stock Exchange, the American Stock Exchange or the
National Association of Securities Dealers, Inc., (ii) trading of any securities
of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities, (iv) there shall have occurred any attack on, outbreak or
escalation of hostilities or act of terrorism involving, the United States, or
any change in financial markets or any calamity or crisis that, in each case, in
your judgment, is material and adverse or (v) any major disruption of
settlements of securities or clearance services in the United States that would
materially impair settlement and clearance with respect to the Offered
Certificates and (b) in the case of any of the events specified in clauses
(a)(i) through (v), such event singly or together with any other such event
makes it, in your judgment, impracticable to market the Offered Certificates on
the terms and in the manner contemplated in the Prospectus.

            9. PAYMENT OF EXPENSES. As among Embraer, the Company and the
Underwriters, Embraer shall pay all expenses incidental to the performance of
the Company's and Embraer's obligations under this Agreement, including the
following:

            (i) expenses incurred in connection with (A) qualifying the Offered
      Certificates for offer and sale under the applicable securities or "blue
      sky" laws of such jurisdictions in the United States as you reasonably
      designate (including filing fees and fees and disbursements of counsel for
      the Underwriters in connection therewith), (B) endeavoring to maintain
      such qualifications in effect so long as required for the distribution of
      such Offered Certificates, (C) the review (if any) of the offering of the
      Offered Certificates by the National Association of Securities Dealers,
      Inc., (D) the determination of the eligibility of the Offered Certificates
      for investment under the laws of such jurisdictions as the Underwriters
      may designate and (E) the preparation and distribution of any blue sky or
      legal investment memorandum by Underwriters' counsel;

            (ii) expenses incurred in connection with the preparation and
      distribution to the Underwriters and the dealers (whose names and
      addresses the Underwriters will furnish to the Company) to which Offered
      Certificates may have been sold by the Underwriters on their behalf and to
      any other dealers upon request, either of (A) amendments to the
      Registration Statement or amendments or supplements to the Prospectus in
      order to make the statements therein, in the light of the circumstances
      when the Prospectus is delivered to a purchaser, not materially misleading
      or (B) amendments or supplements to the Registration Statement or the
      Prospectus so that the Registration Statement or the Prospectus, as so
      amended or supplemented, will comply with law and the expenses incurred in
      connection with causing such amendments or supplements to be filed
      promptly with the Commission, all as set forth in Section 4(a) hereof;




            (iii) the expenses incurred in connection with the preparation,
      printing and filing of the Registration Statement (including financial
      statements and exhibits), as originally filed and as amended, of the
      Preliminary Prospectus and the Prospectus and any amendments thereof and
      supplements thereto, and the cost of furnishing copies thereof to the
      Underwriters;

            (iv) expenses incurred in connection with the preparation, printing
      and distribution of this Agreement, the Offered Certificates and the
      Operative Agreements;

            (v) expenses incurred in connection with the delivery of the Offered
      Certificates to the Underwriters;

            (vi) reasonable fees and disbursements of the counsel and
      accountants for the Company;

            (vii) to the extent Embraer is so required under any Operative
      Agreement to which it is a party, the fees and expenses of the Loan
      Trustees, the Subordination Agent, the Paying Agent, the Trustee, the
      Escrow Agent, the Depositary, the Liquidity Providers and the reasonable
      fees and disbursements of their respective counsel;

            (viii) fees charged by rating agencies for rating the Offered
      Certificates (including annual surveillance fees related to the Offered
      Certificates as long as they are outstanding);

            (ix) reasonable fees and disbursements of counsel for the
      Underwriters;

            (x) all fees and expenses relating to appraisals of the Aircraft;
      and

            (xi) all other reasonable out-of-pocket expenses incurred by the
      Underwriters in connection with the transactions contemplated by this
      Agreement; and

            (xii) except as otherwise provided in the foregoing clauses (i)
      through (xi), all other expenses incidental to the performance of the
      Company's obligations under this Agreement, other than pursuant to Section
      5.

            The provisions of this Section 9 shall not affect any agreements
between the Company, Embraer and any of their respective affiliates for the
sharing of, or otherwise allocating, costs and expenses.

            10. NOTICES. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or sent by facsimile
transmission and confirmed to the Underwriters, c/o Citigroup Global Markets
Inc., 390 Greenwich Street, 4th Floor, New York, New York 10013, Attention: Greg
Lee, facsimile number (212) 723-8677 and c/o Morgan Stanley & Co. Incorporated,
1585 Broadway, New York, NY 10036, Attention: Equipment Finance Group, facsimile
number (212) 761-0786, if sent to the Company, will be mailed, delivered or sent



by facsimile transmission and confirmed to it at 1600 Smith Street, HQSEO,
Houston, TX 77002, Attention: Treasurer and General Counsel, facsimile number
(713) 324-2447, and if sent to Embraer, will be mailed, delivered or sent by
facsimile transmission and confirmed to it at Av. Brigadeiro Faria Lima, 2170,
12227-901 Sao Jose dos Campos, S.P., Brazil, Attention: Senior Vice President
Sales Financing & Asset Management, facsimile number +55-12-3927-2815, with a
copy to Katten Muchin Zavis Rosenman, 1025 Thomas Jefferson Street, N.W., Suite
700, Washington, D.C. 20007, Attention: Timothy J. Lynes, facsimile number (202)
298-7570; PROVIDED, HOWEVER, that any notice to an Underwriter pursuant to
Section 5 will be sent by facsimile transmission or delivered and confirmed to
such Underwriter.

            11. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 5, and no other person will have any
right or obligation hereunder.

            12. REPRESENTATION OF UNDERWRITERS. Citigroup may act for the
several Underwriters in connection with this purchase, and any action under this
Agreement taken by Citigroup will be binding upon all the Underwriters.

            13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which will be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.

            14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK OTHER THAN ANY
LAW WHICH WOULD REQUIRE THE APPLICATION OF A LAW OF A DIFFERENT JURISDICTION.

            15. SUBMISSION TO JURISDICTION; VENUE; APPOINTMENT OF AGENT.

            (a) Each party hereto hereby irrevocably agrees, accepts and submits
itself to the non-exclusive jurisdiction of the courts of the State of New York
in the City and County of New York and of the United States for the Southern
District of New York, in connection with any legal action, suit or proceeding
with respect to any matter relating to or arising out of or in connection with
this Agreement. Each of the parties to this Agreement agrees that a final action
in any such suit or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other lawful manner.

            (b) Each party hereto hereby irrevocably waives, to the fullest
extent permitted by applicable law, and agrees not to assert, by stay of motion,
as a defense, or otherwise, in any legal action or proceeding brought hereunder
in any of the above-named courts, that such action or proceeding is brought in
an inconvenient forum, or that venue for the action or proceeding is improper.




            (c) To the fullest extent permitted by applicable law, each party
hereto hereby waives its respective rights to a jury trial or any claim or cause
of action in any court in any jurisdiction based upon or arising out of or
relating to this Agreement.

            (d) Embraer hereby irrevocably designates and appoints Corporation
Services Company, 1177 Avenue of the Americas, 17th Floor, New York, NY 10036
(the "PROCESS AGENT"), as the authorized agent of Embraer upon whom process may
be served in any such suit or proceeding, it being understood that the
designation and appointment of the Process Agent as such authorized agent shall
become effective immediately without any further action on the part of Embraer.
Embraer represents to the Underwriters and the Company that it has notified the
Process Agent of such designation and appointment and that the Process Agent has
accepted the same in writing. Embraer hereby irrevocably authorizes and directs
the Process Agent to accept such service. Embraer further agrees that service of
process upon the Process Agent and written notice of said service to Embraer
mailed by first-class mail or delivered to the Process Agent, shall be deemed in
every respect effective service of process upon Embraer in any such suit or
proceeding. Nothing herein shall affect the right of the Underwriters or the
Company, or any person controlling the Underwriters or the Company, to serve
process in any other manner permitted by law.

            16. SOVEREIGN IMMUNITY. Each party hereto hereby irrevocably agrees
that, to the extent that it or any of its assets now has or may hereafter
acquire any right of immunity as against any other party hereto or its
respective successors and assigns, whether characterized as sovereign immunity
or otherwise, from any legal proceedings, whether in the United States of
America or elsewhere, arising out of this Agreement or the subject matter hereof
or any of the transactions contemplated hereby brought by any of the parties
hereto or their successors or assigns, including, without limitation, immunity
from service of process, immunity from jurisdiction or judgment of any court or
tribunal, immunity from execution of a judgment, and immunity of any of its
assets from attachment in aid of execution upon a judgment, it hereby expressly
and irrevocably waives and agrees not to assert any such immunity and such
waiver shall be irrevocable and not subject to withdrawal in any jurisdiction,
including, without limitation, under the United States Foreign Sovereign
Immunities Act of 1976.

            17. CURRENCY INDEMNITY. In the event of a judgment, order or award
being rendered by any court or tribunal for the payment of any amounts owing to
any party hereto (the "PAYEE") under this Agreement or for the payment of
damages in respect of a judgment or order of another court or tribunal for the
payment of such amount or damages, such judgment, order or award being expressed
in a currency (the "JUDGMENT CURRENCY") other than United States dollars (the
"AGREED CURRENCY"), each party hereto obligated to pay such amounts owing (each,
a "PAYOR") agrees, to the fullest extent permitted by applicable law, (a) that
its obligations in respect of any such amounts owing shall be discharged only to
the extent that on the business day following the Payee's receipt of any sum
adjudged in the Judgment Currency the Payee may in accordance with the normal
banking procedures purchase the Agreed Currency with the Judgment Currency and
(b) to indemnify and hold harmless the Payee against any deficiency in terms of
the Agreed Currency in the amounts actually received by the Payee following any
such purchase (after deduction of any premiums and costs of exchange payable in
connection with the purchase of, or conversion into, the Agreed Currency). The
indemnity set forth in the preceding sentence shall (notwithstanding any



judgment referred to in the preceding sentence) constitute an obligation of each
Payor separate and independent from its other obligations hereunder and shall
apply irrespective of any indulgence granted by the Payee.




            If the foregoing is in accordance with the Underwriters'
understanding of our agreement, kindly sign and return to the Company one of the
counterparts hereof, whereupon it will become a binding agreement among the
Underwriters, the Depositary, Embraer and the Company in accordance with its
terms.
                                          Very truly yours,

                                          CONTINENTAL AIRLINES, INC.

                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:


                                          EMBRAER - EMPRESA BRASILEIRA DE
                                          AERONAUTICA S.A.


                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:


                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:



The foregoing Underwriting Agreement
is hereby confirmed and accepted
as of the date first above written

By:  CITIGROUP GLOBAL MARKETS INC.


      By:
         ---------------------------------
         Name:
         Title:


By:  MORGAN STANLEY & CO. INCORPORATED

      By:
         ---------------------------------
         Name:
         Title:






WESTLB AG,
acting through its New York Branch,
as Depositary


By:
   -------------------------------
   Name:
   Title:

By:
   -------------------------------
   Name:
   Title:




                                   SCHEDULE I
                  (Pass Through Certificates, Series 2004-ERJ1)
                           CONTINENTAL AIRLINES, INC.

   Pass Through       Aggregate                                Final
   Certificate        Principal                              Maturity
   Designation          Amount        Interest Rate            Date
   -----------       ----------       -------------        ------------

   2004-ERJ1        $173,629,000         9.558%           March 1, 2021




                                   SCHEDULE II

                ----------------------------------------------
              |         UNDERWRITERS          |   2004-ERJ1   |
              | ------------------------------|---------------|
              | Citigroup Global Markets Inc. |  $86,815,000  |
              | 388 Greenwich Street          |               |
              | New York, NY 10013            |               |
              | ------------------------------|---------------|
              | Morgan Stanley & Co.          |  $86,814,000  |
              |   Incorporated                |               |
              | 1585 Broadway                 |               |
              | New York, NY  10036           |               |
                ----------------------------------------------




                                  SCHEDULE III
                           CONTINENTAL AIRLINES, INC.

Underwriting commission
and other compensation:            $2,187,725.40
Closing date, time and location:   June 29, 2004
                                   10:00 A.M.,
                                   New York time
                                   Hughes Hubbard & Reed LLP
                                   One Battery Park Plaza
                                   New York, New York 10004





                                     ANNEX I


            For purposes of the Underwriting Agreement, "CONTINENTAL
INFORMATION" shall consist of the following information:

            (i) with respect to the Basic Prospectus, all information included
      therein and all documents deemed to be incorporated by reference therein
      (and exhibits to such documents if so incorporated), but excluding the
      Basic Agreement and any documents filed with the Commission subsequent to
      the Closing Date in connection with the transactions contemplated by this
      Agreement;

            (ii) with respect to the Registration Statement, all information
      included therein and all documents deemed to be incorporated by reference
      therein (and exhibits to such documents if so incorporated), but excluding
      the Basic Agreement and any documents filed with the Commission subsequent
      to the Closing Date in connection with the transactions contemplated by
      this Agreement; and

            (iii) with respect to the Preliminary Prospectus Supplement and the
      Prospectus Supplement, the statements set forth in the following sections:

                  (a) "Summary Financial and Operating Data";

                  (b) "Risk Factors--Risk Factors Relating to the Company" and
            "Risk Factors--Risk Factors Relating to the Airline Industry";

                  (c) "The Company"; and

                  (d) "Incorporation of Certain Documents by Reference", and all
            documents deemed to be incorporated by reference in the Preliminary
            Prospectus Supplement or Prospectus Supplement, as the case may be,
            as specified in "Incorporation of Certain Documents by Reference"
            (and exhibits to such documents if so incorporated), but excluding
            the Basic Agreement and any documents filed with the Commission
            subsequent to the Closing Date in connection with the transactions
            contemplated by this Agreement.

            For purposes of the Underwriting Agreement, "EMBRAER INFORMATION"
shall consist of all of the information in the Registration Statement, the Basic
Prospectus, the Preliminary Prospectus Supplement and the Prospectus Supplement
other than the Continental Information.










                         TRUST SUPPLEMENT No. 2004-ERJ1

                            Dated as of June 29, 2004


                                     between

                            WILMINGTON TRUST COMPANY,
                                   as Trustee,


                                       and


                           CONTINENTAL AIRLINES, INC.

                                       to

                          PASS THROUGH TRUST AGREEMENT
                         Dated as of September 25, 1997


                                  $173,629,000

             Continental Airlines Pass Through Trust 2004-ERJ1
                           9.558% Continental Airlines
                           Pass Through Certificates,
                                Series 2004-ERJ1





            This Trust Supplement No. 2004-ERJ1, dated as of June 29, 2004
(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 in
the Basic Agreement) which may be issued thereunder, has heretofore been
executed and delivered;

            WHEREAS, the Company wishes to lease certain Aircraft from the
relevant Owner Trustees;

            WHEREAS, in the case of each Aircraft, the related Owner Trustee,
acting on behalf of the related Owner Participant, will issue pursuant to an
Indenture, on a non-recourse basis, one series of Equipment Notes in order to
finance the debt portion of the purchase price of such Aircraft;

            WHEREAS, the Trustee hereby declares the creation of this
Continental Airlines Pass Through Trust 2004-ERJ1 (the "APPLICABLE TRUST") for
the benefit of the Applicable Certificateholders, and the initial Applicable
Certificateholders as the grantors of the Applicable Trust, by their respective
acceptances of the Applicable Certificates, join in the creation of the
Applicable Trust with the Trustee;

            WHEREAS, all Certificates to be issued by the Applicable Trust will
evidence fractional undivided interests in the Applicable Trust and will convey
no rights, benefits or interests in respect of any property other than the Trust
Property except for those Certificates to which an Escrow Receipt has been
affixed;

            WHEREAS, the Escrow Agent and the Underwriters have
contemporaneously herewith entered into an Escrow Agreement with the Escrow
Paying Agent pursuant to which the Underwriters have delivered to the Escrow
Agent the proceeds from the sale of the Applicable Certificates, to the extent
not used to purchase Equipment Notes on the Issuance Date, and have irrevocably
instructed the Escrow Agent to withdraw and pay funds from such proceeds upon
request and proper certification by the Trustee to purchase Equipment Notes as
the Aircraft are financed under the NPA (as hereinafter defined) from time to
time prior to the Delivery Period Termination Date;

            WHEREAS, the Escrow Agent on behalf of the Applicable
Certificateholders has contemporaneously herewith entered into a Deposit
Agreement with the Depositary under which the Deposits referred to therein will
be made and from which it will withdraw funds to allow the Trustee to purchase
Equipment Notes from time to time prior to the Delivery Period Termination Date;




            WHEREAS, pursuant to the terms and conditions of the Basic Agreement
as supplemented by this Trust Supplement (the "AGREEMENT") and the NPA, upon the
financing of an Aircraft, the Trustee on behalf of the Applicable Trust, using
funds withdrawn under the Escrow Agreement (or, if financed on the Issuance
Date, using a portion of the proceeds of the sale of the Applicable
Certificates), shall purchase one or more Equipment Notes having the same
interest rate as, and final maturity date not later than the final Regular
Distribution Date of, the Applicable Certificates issued hereunder and shall
hold such Equipment Notes in trust for the benefit of the Applicable
Certificateholders;

            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:


                                    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
"9.558% Continental Airlines Pass Through Certificates, Series 2004-ERJ1"
(hereinafter defined as the "APPLICABLE CERTIFICATES"). Each Applicable
Certificate represents a fractional undivided interest in the Applicable Trust
created hereby. The Applicable Certificates shall be the only instruments
evidencing a fractional undivided interest in the Applicable Trust.

            The terms and conditions applicable to the Applicable Certificates
are as follows:

            (a) The aggregate principal amount of the Applicable Certificates
      that shall be authenticated under the Agreement (except for Applicable
      Certificates authenticated and delivered pursuant to Sections 3.03, 3.04,
      3.05 and 3.06 of the Basic Agreement) is $173,629,000.

            (b) The Regular Distribution Dates with respect to any payment of
      Scheduled Payments means the 1st day of each month, commencing on August
      1, 2004, until payment of all of the Scheduled Payments to be made under
      the Equipment Notes has been made.




            (c) The Special Distribution Dates with respect to the Applicable
      Certificates means any Business Day on which a Special Payment is to be
      distributed pursuant to the Agreement.

            (d) At the Escrow Agent's request under the Escrow Agreement, the
      Trustee shall affix the corresponding Escrow Receipt to each Applicable
      Certificate. In any event, any transfer or exchange of any Applicable
      Certificate shall also effect a transfer or exchange of the related Escrow
      Receipt. Prior to the Final Withdrawal Date, no transfer or exchange of
      any Applicable Certificate shall be permitted unless the corresponding
      Escrow Receipt is attached thereto and also is so transferred or
      exchanged. By acceptance of any Applicable Certificate to which an Escrow
      Receipt is attached, each Holder of such an Applicable Certificate
      acknowledges and accepts the restrictions on transfer of the Escrow
      Receipt set forth herein and in the Escrow Agreement.

            (e) (i) The Applicable Certificates shall be in the form attached
      hereto as Exhibit A. Any Person acquiring or accepting an Applicable
      Certificate or an interest therein will, by such acquisition or
      acceptance, be deemed to represent and warrant 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 Applicable Certificates or an
      interest therein or (ii) the purchase and holding of Applicable
      Certificates or an interest therein is exempt from the prohibited
      transaction restrictions of ERISA and the Code pursuant to one or more
      prohibited transaction statutory or administrative exemptions.

            (ii) The Applicable Certificates shall be Book-Entry Certificates
      and shall be subject to the conditions set forth in the Letter of
      Representations between the Company and the Clearing Agency attached
      hereto as Exhibit B.

            (f) The "Participation Agreements" as defined in this Trust
      Supplement are the "Note Purchase Agreements" referred to in the Basic
      Agreement.

            (g) The Applicable Certificates are subject to the Intercreditor
      Agreement, the Deposit Agreement and the Escrow Agreement.

            (h) The Applicable Certificates are entitled to the benefits of the
      Liquidity Facilities.

            (i) The Responsible Party is the Company.

            (j) The date referred to in clause (i) of the definition of the term
      "PTC Event of Default" in the Basic Agreement is the Final Maturity Date.




            (k) 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 Participation Agreement.

            (l) The Equipment Notes to be acquired and held in the Applicable
      Trust, and the related Aircraft and Note Documents, are described in the
      NPA.


                                   ARTICLE II
                                   DEFINITIONS

            Section 2.01. DEFINITIONS. For all purposes of the Basic Agreement
as supplemented by this Trust Supplement, the following capitalized terms have
the following meanings (any term used herein which is defined in both this Trust
Supplement and the Basic Agreement shall have the meaning assigned thereto in
this Trust Supplement for purposes of the Basic Agreement as supplemented by
this Trust Supplement):

            AGREEMENT:  Has the meaning specified in the recitals hereto.

            AIRCRAFT: Means each of the Aircraft (as defined in the NPA) or
      Substitute Aircraft in respect of which a Participation Agreement is to be
      or is, as the case may be, entered into in accordance with the NPA (or any
      substitute aircraft, including engines therefor, leased to the Company and
      securing one or more Equipment Notes).

            AIRCRAFT PURCHASE AGREEMENT:  Means the "Purchase Agreement" as
      defined in the NPA.

            APPLICABLE CERTIFICATE:  Has the meaning specified in
      Section 1.01 of this Trust Supplement.

            APPLICABLE CERTIFICATEHOLDER:  Means the Person in whose name
      an Applicable Certificate is registered on the Register for the
      Applicable Certificates.

            APPLICABLE CLOSING DATE:  Has the meaning specified in Section
      5.01(b) of this Trust Supplement.

            APPLICABLE PARTICIPATION AGREEMENT:  Has the meaning specified
      in Section 5.01(b) of this Trust Supplement.

            APPLICABLE TRUST:  Has the meaning specified in the recitals
      hereto.

            BASIC AGREEMENT:  Has the meaning specified in the first
      paragraph of this Trust Supplement.

            BUSINESS DAY: Means 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, Salt Lake City, Utah or, so long as any
      Applicable Certificate is Outstanding, the city and state in which the
      Trustee or any Loan Trustee maintains its Corporate Trust Office or
      receives and disburses funds.

            COMPANY:  Has the meaning specified in the first paragraph of
      this Trust Supplement.

            CONTROLLING PARTY:  Has the meaning specified in the
      Intercreditor Agreement.

            CUT-OFF DATE:  Means the earlier of (a) the Delivery Period
      Termination Date and (b) the date on which a Triggering Event occurs.

            DELIVERY NOTICE:  Has the meaning specified in the NPA.

            DELIVERY PERIOD TERMINATION DATE: Means the earlier of (a) December
      31, 2004, or, if the Equipment Notes relating to all of the Aircraft (or
      Substitute Aircraft in lieu thereof) have not been purchased by the
      Trustee on or prior to such date due to any reason beyond the control of
      the Company and not occasioned by the Company's fault or negligence, March
      31, 2005 and (b) the date on which Equipment Notes issued with respect to
      all of the Aircraft (or Substitute Aircraft in lieu thereof) have been
      purchased by the Applicable Trust in accordance with the NPA.

            DEPOSIT AGREEMENT: Means the Deposit Agreement dated as of June 29,
      2004 relating to the Applicable Certificates between the Depositary and
      the Escrow Agent, as the same may be amended, supplemented or otherwise
      modified from time to time in accordance with its terms.

            DEPOSITARY: Means WestLB AG, a joint stock company
      ("Aktiengesellschaft") organized under the laws of Germany, acting through
      its New York Branch.

            DEPOSITS:  Has the meaning specified in the Deposit Agreement.

            DISTRIBUTION DATE:  Means any Regular Distribution Date or
      Special Distribution Date as the context requires.

            EMBRAER:  Means Embraer-Empresa Brasileira de Aeronautica S.A.

            ESCROW AGENT: Means, initially, Wells Fargo Bank Northwest, National
      Association, and any replacement or successor therefor appointed in
      accordance with the Escrow Agreement.

            ESCROW AGREEMENT: Means the Escrow and Paying Agent Agreement dated
      as of June 29, 2004 relating to the Applicable Certificates, among the
      Escrow Agent, the Escrow Paying Agent, the Trustee and Underwriters, as
      the same may be amended, supplemented or otherwise modified from time to
      time in accordance with its terms.




            ESCROW PAYING AGENT: Means the Person acting as paying agent under
      the Escrow Agreement.

            ESCROW RECEIPT: Means the receipt substantially in the form annexed
      to the Escrow Agreement representing a fractional undivided interest in
      the funds held in escrow thereunder.

            FINAL MATURITY DATE:  Means March 1, 2021.

            FINAL WITHDRAWAL:  Has the meaning specified in the Escrow
      Agreement.

            FINAL WITHDRAWAL DATE:  Has the meaning specified in the Escrow
      Agreement.

            FINAL WITHDRAWAL NOTICE:  Has the meaning specified in Section
      5.02 of this Trust Supplement.

            INDENTURE: Means each of the separate trust indentures and mortgages
      relating to the Aircraft, each as specified or described in a Delivery
      Notice delivered pursuant to the NPA or the related Participation
      Agreement, in each case as the same may be amended, supplemented or
      otherwise modified from time to time in accordance with its terms.

            INTERCREDITOR AGREEMENT: Means the Intercreditor Agreement dated as
      of June 29, 2004 among the Trustee, the Liquidity Providers and Wilmington
      Trust Company, as Subordination Agent and as trustee thereunder, as
      amended, supplemented or otherwise modified from time to time in
      accordance with its terms.

            INVESTORS: Means the Underwriters together with all subsequent
      beneficial owners of the Applicable Certificates.

            LIQUIDITY FACILITIES: Means, initially, (i) the Revolving Credit
      Agreement dated as of June 29, 2004 relating to the Applicable
      Certificates, between WestLB AG, New York Branch, and Wilmington Trust
      Company, as Subordination Agent, as agent and trustee for the Applicable
      Trust and (ii) the Revolving Credit Agreement dated as of June 29, 2004
      relating to the Applicable Certificates, between Citicorp North America,
      Inc. and Wilmington Trust Company, as Subordination Agent, as agent and
      trustee for the Applicable Trust, and, from and after the replacement of
      either such agreement pursuant to the Intercreditor Agreement, the
      replacement liquidity facility therefor, in each case as amended,
      supplemented or otherwise modified from time to time in accordance with
      their respective terms.

            LIQUIDITY PROVIDERS: Means, initially (i) WestLB AG, a joint stock
      company ("Aktiengesellschaft") organized under the laws of Germany, acting
      through its New York Branch, and (ii) Citicorp North America, Inc., a
      Delaware corporation, and any replacements or successors therefor
      appointed in accordance with the Intercreditor Agreement.




            NOTE DOCUMENTS: Means the Equipment Notes with respect to the
      Applicable Certificates and, with respect to any such Equipment Note, the
      related Indenture, Participation Agreement and Lease.

            NOTICE OF PURCHASE WITHDRAWAL: Has the meaning specified in the
      Deposit Agreement.

            NPA: Means the Note Purchase Agreement dated as of June 29, 2004
      among the Trustee, the Company, the Escrow Agent, the Escrow Paying Agent
      and the Subordination Agent, providing for, among other things, the
      purchase of Equipment Notes by the Trustee on behalf of the Applicable
      Trust, as the same may be amended, supplemented or otherwise modified from
      time to time, in accordance with its terms.

            PARTICIPATION AGREEMENT: Means each Participation Agreement entered
      into or to be entered into, as the case may be, by the Trustee pursuant to
      the NPA, as the same may be amended, supplemented or otherwise modified
      from time to time in accordance with its terms.

            POOL BALANCE: Means, as of any date, (i) the original aggregate face
      amount of the Applicable Certificates less (ii) the aggregate amount of
      all payments made in respect of such Applicable Certificates or in respect
      of Deposits 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 any special distribution with respect to unused
      Deposits, payment of principal of the Equipment Notes or payment with
      respect to other Trust Property and the distribution thereof to be made on
      that date.

            POOL FACTOR: Means, as of any Distribution Date, the quotient
      (rounded to the seventh decimal place) computed by dividing (i) the Pool
      Balance by (ii) the original aggregate face amount of the Applicable
      Certificates. The Pool Factor as of any Distribution Date shall be
      computed after giving effect to any special distribution with respect to
      unused Deposits, payment of principal of the Equipment Notes or payments
      with respect to other Trust Property and the distribution thereof to be
      made on that date.

            PROSPECTUS SUPPLEMENT:  Means the final Prospectus Supplement
      dated June 18, 2004 relating to the offering of the Applicable
      Certificates.

            RATINGS CONFIRMATION:  Has the meaning specified in the
      Intercreditor Agreement.

            SCHEDULED CLOSING DATE:  Has the meaning specified in the NPA.

            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).

            SUBSTITUTE AIRCRAFT:  Has the meaning specified in the NPA.




            TRIGGERING EVENT:  Has the meaning assigned to such term in the
      Intercreditor Agreement.

            TRUST PROPERTY: Means (i) subject to the Intercreditor Agreement,
      the Equipment Notes held as the property of the Applicable 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 Certificate
      Account and the Special Payments Account and, subject to the Intercreditor
      Agreement, any proceeds from the sale by the Trustee pursuant to Article
      VI of the Basic Agreement of any Equipment Note and (iii) all rights of
      the Applicable Trust and the Trustee, on behalf of the Applicable Trust,
      under the Intercreditor Agreement, the Escrow Agreement, the NPA and the
      Liquidity Facilities, including, without limitation, all rights to receive
      certain payments thereunder, and all monies paid to the Trustee on behalf
      of the Applicable Trust pursuant to the Intercreditor Agreement or the
      Liquidity Facilities, PROVIDED that rights with respect to the Deposits or
      under the Escrow Agreement, except for the right to direct withdrawals for
      the purchase of Equipment Notes to be held herein, will not constitute
      Trust Property.

            TRUST SUPPLEMENT: Has the meaning specified in the first paragraph
      of this trust supplement.

            UNDERWRITERS:  Means, collectively, Citigroup Global Markets
      Inc. and Morgan Stanley & Co. Incorporated.

            UNDERWRITING AGREEMENT: Means the Underwriting Agreement dated June
      18, 2004 among the Underwriters, the Company, the Depositary and Embraer,
      as the same may be amended, supplemented or otherwise modified from time
      to time in accordance with its terms.

                                ARTICLE III
              DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS

            Section 3.01. STATEMENTS TO APPLICABLE CERTIFICATEHOLDERS. (a) On
each Distribution Date, the Trustee will include with each distribution to
Applicable Certificateholders of a Scheduled Payment or Special Payment, as the
case may be, a statement setting forth the information provided below (in the
case of a Special Payment, reflecting in part the information provided by the
Escrow Paying Agent under the Escrow Agreement). Such statement shall set forth
(per $1,000 face amount Applicable Certificate as to (ii), (iii), (iv) and (v)
below) the following information:

            (i) the aggregate amount of funds distributed on such Distribution
      Date under the Agreement and under the Escrow Agreement, indicating the
      amount allocable to each source;

            (ii) the amount of such distribution under the Agreement allocable
      to principal and the amount allocable to premium, if any;




            (iii) the amount of such distribution under the Agreement allocable
      to interest;

            (iv) the amount of such distribution under the Escrow Agreement
      allocable to interest;

            (v) the amount of such distribution under the Escrow Agreement
      allocable to unused Deposits, if any; and

            (vi) the Pool Balance and the Pool Factor.

            With respect to the Applicable Certificates registered in the name
of a Clearing Agency, on the Record Date prior to each Distribution Date, the
Trustee will request from such Clearing Agency a securities position listing
setting forth the names of all Clearing Agency Participants reflected on such
Clearing Agency's books as holding interests in the Applicable Certificates on
such Record Date. On each Distribution Date, the 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 Applicable Certificates.

            (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 an
Applicable Certificateholder of record a statement containing the sum of the
amounts determined pursuant to clauses (a)(i), (a)(ii), (a)(iii), (a)(iv) and
(a)(v) above for such calendar year or, in the event such Person was an
Applicable Certificateholder of record during a portion of such calendar year,
for such portion of such calendar year, and such other items as are readily
available to the Trustee and which an Applicable Certificateholder shall
reasonably request as necessary for the purpose of such Applicable
Certificateholder's preparation of its federal income tax returns. 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 Applicable Certificates in the manner described in Section 3.01(a) of
this Trust Supplement.

            (c) Promptly following (i) the Delivery Period Termination Date, if
there has been any change in the information set forth in clauses (y) and (z)
below from that set forth in pages S-32 through S-36 of the Prospectus
Supplement, and (ii) the date of any early redemption or purchase of, or any
default in the payment of principal or interest in respect of, any of the
Equipment Notes held in the Applicable Trust, or any Final Withdrawal, the
Trustee shall furnish to Applicable Certificateholders of record on such date a
statement setting forth (x) the expected Pool Balances for each subsequent
Regular Distribution Date following the Delivery Period Termination Date, (y)
the related Pool Factors for such Regular Distribution Dates and (z) the
expected principal distribution schedule of the Equipment Notes, in the
aggregate, held as Trust Property at the date of such notice. With respect to
the Applicable Certificates registered in the name of a Clearing Agency, on the
Delivery Period Termination Date, the Trustee will request from such Clearing



Agency a securities position listing setting forth the names of all Clearing
Agency Participants reflected on such Clearing Agency's books as holding
interests in the Applicable Certificates on such date. The 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 Applicable
Certificates.

            (d) This Section 3.01 supersedes and replaces Section 4.03 of the
Basic Agreement, with respect to the Applicable Trust.


            Section 3.02. SPECIAL PAYMENTS ACCOUNT. (a) The Trustee shall
establish and maintain on behalf of the Applicable Certificateholders a Special
Payments Account as one or more accounts, which shall be non-interest bearing
except as provided in Section 4.04 of the Basic Agreement. The Trustee shall
hold the Special Payments Account in trust for the benefit of the Applicable
Certificateholders and shall make or permit withdrawals therefrom only as
provided in the Agreement. On each day when one or more Special Payments are
made to the Trustee under the Intercreditor Agreement, the Trustee, upon receipt
thereof, shall immediately deposit the aggregate amount of such Special Payments
in the Special Payments Account.

            (b) This Section 3.02 supersedes and replaces Section 4.01(b) of the
Basic Agreement in its entirety, with respect to the Applicable Trust.

            Section 3.03. DISTRIBUTIONS FROM SPECIAL PAYMENTS ACCOUNT. (a) On
each Special Distribution Date with respect to any Special Payment 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
Applicable Trust or realized upon the sale of such Equipment Notes, the Trustee
shall distribute out of the Special Payments Account the entire amount of such
Special Payment deposited therein pursuant to Section 3.02(a) of this Trust
Supplement. There shall be so distributed to each Applicable Certificateholder
of record on the Record Date with respect to such Special Distribution Date
(other than as provided in Section 11.01 of the Basic Agreement concerning the
final distribution) by check mailed to such Applicable Certificateholder, at the
address appearing in the Register, such Applicable Certificateholder's pro rata
share (based on the Fractional Undivided Interest in the Applicable Trust held
by such Applicable Certificateholder) of the total amount in the Special
Payments Account on account of such Special Payment, except that, with respect
to Applicable 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) The Trustee shall, at the expense of the Company, cause notice
of each Special Payment to be mailed to each Applicable Certificateholder at his
address as it appears in the Register. In the event of redemption or purchase of
Equipment Notes held in the Applicable 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 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:

            (i) the Special Distribution Date and the Record Date therefor
      (except as otherwise provided in Section 11.01 of the Basic Agreement),

            (ii) the amount of the Special Payment for each $1,000 face amount
      Applicable 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, the total amount to be received on such date for each
      $1,000 face amount Applicable 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 the Trust is
canceled, the Trustee, as soon as possible after learning thereof, shall cause
notice thereof to be mailed to each Applicable Certificateholder at its address
as it appears on the Register.

            (b) This Section 3.03 supersedes and replaces Section 4.02(b) and
Section 4.02(c) of the Basic Agreement in their entirety, with respect to the
Applicable Trust.

                                   ARTICLE IV
                                     DEFAULT

            Section 4.01. AMENDMENT OF SECTION 6.05 OF THE BASIC AGREEMENT.
Section 6.05 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by deleting the phrase "and thereby annul any Direction given
by such Certificateholders or the Trustee to such Loan Trustee with respect
thereto," set forth in the first sentence thereof.


                                    ARTICLE V
                                   THE TRUSTEE

            Section 5.01. DELIVERY OF DOCUMENTS; DELIVERY DATES. (a) The Trustee
is hereby directed (i) to execute and deliver the Intercreditor Agreement, the
Escrow Agreement and the NPA on or prior to the Issuance Date, each in the form
delivered to the Trustee by the Company, and (ii) subject to the respective
terms thereof, to perform its obligations thereunder. Upon request of the
Company and the satisfaction or waiver of the closing conditions specified in
the Underwriting Agreement, the Trustee shall execute, deliver, authenticate,
issue and sell Applicable Certificates in authorized denominations equaling in
the aggregate the amount set forth, with respect to the Applicable Trust, in



Schedule I to the Underwriting Agreement evidencing the entire ownership
interest in the Applicable Trust, which amount equals the maximum aggregate
principal amount of Equipment Notes which may be purchased by the Trustee
pursuant to the NPA. Except as provided in Sections 3.03, 3.04, 3.05 and 3.06 of
the Basic Agreement, the Trustee shall not execute, authenticate or deliver
Applicable Certificates in excess of the aggregate amount specified in this
paragraph. The provisions of this Section 5.01(a) supersede and replace the
first sentence of Section 3.02(a) of the Basic Agreement, with respect to the
Applicable Trust.

            (b) On or after the Issuance Date, the Company may deliver from time
to time to the Trustee a Delivery Notice relating to one or more Equipment
Notes. After receipt of a Delivery Notice and in any case no later than one
Business Day prior to a Scheduled Closing Date as to which such Delivery Notice
relates (the "APPLICABLE CLOSING DATE"), the Trustee shall (as and when
specified in the Delivery Notice) instruct the Escrow Agent to provide a Notice
of Purchase Withdrawal to the Depositary requesting (A) the withdrawal of one or
more Deposits on the Applicable Closing Date in accordance with and to the
extent permitted by the terms of the Escrow Agreement and the Deposit Agreement
and (B) the payment of all, or a portion, of such Deposit or Deposits in an
amount equal in the aggregate to the purchase price of such Equipment Notes to
or on behalf of the Owner Trustee issuing such Equipment Notes, all as shall be
described in the Delivery Notice; PROVIDED that, if the Issuance Date is an
Applicable Closing Date, the Trustee shall not so instruct the Escrow Agent, and
the purchase price of such Equipment Notes shall be paid from a portion of the
proceeds of the sale of the Applicable Certificates. The Trustee shall (as and
when specified in such Delivery Notice), subject to the conditions set forth in
Section 2 of the NPA, enter into and perform its obligations under the
Participation Agreement specified in such Delivery Notice (the "APPLICABLE
PARTICIPATION AGREEMENT") and cause such certificates, documents and legal
opinions relating to the Trustee to be duly delivered as required by the
Applicable Participation Agreement. If at any time prior to the Applicable
Closing Date, the Trustee receives a notice of postponement pursuant to Section
1(e) or 1(f) of the NPA, then the Trustee shall give the Depositary (with a copy
to the Escrow Agent) a notice of cancellation of such Notice of Purchase
Withdrawal relating to such Deposit or Deposits on such Applicable Closing Date.
Upon satisfaction of the conditions specified in the NPA and the Applicable
Participation Agreement, the Trustee shall purchase the applicable Equipment
Notes with the proceeds of the withdrawals of one or more Deposits made on the
Applicable Closing Date in accordance with the terms of the Deposit Agreement
and the Escrow Agreement (or, if the Issuance Date is the Applicable Closing
Date with respect to such Applicable Participation Agreement, from a portion of
the proceeds of the sale of the Applicable Certificates; PROVIDED, that, if any
portion of such proceeds is not used to purchase Equipment Notes by 3:30 p.m.,
New York time, on such date, the Trustee (on behalf of the Investors) shall
immediately (but in no event later than 4:00 p.m., New York time, on such date)
deposit such unused proceeds with the Depositary (in Federal immediately
available funds by wire transfer) in accordance with the Deposit Agreement and
such deposit or deposits shall constitute a "Deposit" or "Deposits" (as defined
therein) for all purposes thereunder). The purchase price of such Equipment
Notes shall equal the principal amount of such Equipment Notes. Amounts
withdrawn from such Deposit or Deposits in excess of the purchase price of the
Equipment Notes or to the extent not applied on the Applicable Closing Date to
the purchase price of the Equipment Notes, shall be re-deposited by the Trustee



with the Depositary on the Applicable Closing Date in accordance with the terms
of the Deposit Agreement. The provisions of this Section 5.01(b) supersede and
replace the provisions of Section 2.02 of the Basic Agreement with respect to
the Applicable Trust, and all provisions of the Basic Agreement relating to
Postponed Notes and Section 2.02 of the Basic Agreement shall not apply to the
Applicable Trust.

            (c) The Trustee acknowledges its acceptance of all right, title and
interest in and to the Trust Property to be acquired pursuant to Section 5.01(b)
of this Trust Supplement, the NPA and each Applicable Participation Agreement,
and declares that it holds and will hold such right, title and interest for the
benefit of all present and future Applicable Certificateholders, upon the trusts
set forth in the Agreement. By its acceptance of an Applicable Certificate, each
initial Applicable Certificateholder, as a grantor of the Applicable Trust,
joins with the Trustee in the creation of the Applicable Trust. The provisions
of this Section 5.01(c) supersede and replace the provisions of Section 2.03 of
the Basic Agreement, with respect to the Applicable Trust.

            Section 5.02. WITHDRAWAL OF DEPOSITS. If any Deposits remain
outstanding on the Business Day next succeeding the Cut-off Date, the Trustee
shall give the Escrow Agent notice that the Trustee's obligation to purchase
Equipment Notes under the NPA has terminated and instruct the Escrow Agent to
provide a notice of Final Withdrawal to the Depositary substantially in the form
of Exhibit B to the Deposit Agreement (the "FINAL WITHDRAWAL NOTICE").

            Section 5.03. THE TRUSTEE. (a) Subject to Section 5.04 of this Trust
Supplement and Section 7.15 of the Basic Agreement, the Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Trust Supplement, the Deposit Agreement, the NPA or the
Escrow Agreement or the due execution hereof or thereof by the Company or the
other parties thereto (other than the Trustee), or for or in respect of the
recitals and statements contained herein or therein, all of which recitals and
statements are made solely by the Company, except that the Trustee hereby
represents and warrants that each of this Trust Supplement, the Basic Agreement,
each Applicable Certificate, the Intercreditor Agreement, the NPA and the Escrow
Agreement has been executed and delivered by one of its officers who is duly
authorized to execute and deliver such document on its behalf.

            (b) Except as herein otherwise provided and except during the
continuation of an Event of Default in respect of the Applicable Trust created
hereby, 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 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 Agreement, as fully to all intents as if the same were herein set
forth at length.

            Section 5.04. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The
Trustee hereby represents and warrants that:

            (a) the Trustee has full power, authority and legal right to
      execute, deliver and perform this Trust Supplement, the Intercreditor
      Agreement, the Escrow Agreement, the NPA and the Note Documents to which
      it is or is to become a party and has taken all necessary action to



      authorize the execution, delivery and performance by it of this Trust
      Supplement, the Intercreditor Agreement, the Escrow Agreement, the NPA and
      the Note Documents to which it is or is to become a party;

            (b) the execution, delivery and performance by the Trustee of this
      Trust Supplement, the Intercreditor Agreement, the Escrow Agreement, the
      NPA and the Note Documents to which it is or is to become a party (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;

            (c) the execution, delivery and performance by the Trustee of this
      Trust Supplement, the Intercreditor Agreement, the Escrow Agreement, the
      NPA and the Note Documents to which it is or is to become a party 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 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

            (d) this Trust Supplement, the Intercreditor Agreement, the Escrow
      Agreement, the NPA and the Note Documents to which it is or is to become a
      party have been, or will be, as applicable, duly executed and delivered by
      the Trustee and constitute, or will constitute, as applicable, 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 5.05. TRUSTEE LIENS. The Trustee in its individual capacity
agrees, in addition to the agreements contained in Section 7.17 of the Basic
Agreement, that it will at its own cost and expense promptly take any action as
may be necessary to duly discharge and satisfy in full any Trustee's Liens on or
with respect to the Trust Property which is attributable to the Trustee in its
individual capacity and which is unrelated to the transactions contemplated by
the Intercreditor Agreement or the NPA.




                                 ARTICLE VI
               ADDITIONAL AMENDMENT; SUPPLEMENTAL AGREEMENTS

            Section 6.01. AMENDMENT OF SECTION 5.02 OF THE BASIC Agreement.
Section 5.02 of the Basic Agreement shall be amended, with respect to the
Applicable Trust, by (i) replacing the phrase "of the Note Documents and of this
Agreement" set forth in paragraph (b) thereof with the phrase "of the Note
Documents, of the NPA and of this Agreement" and (ii) replacing the phrase "of
this Agreement and any Note Document" set forth in the last paragraph of Section
5.02 with the phrase "of this Agreement, the NPA and any Note Document".

            Section 6.02. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.01 of the Basic Agreement,
under the terms of, and subject to the limitations contained in, Section 9.01 of
the Basic Agreement, the Company may (but will not be required to), and the
Trustee (subject to Section 9.03 of the Basic Agreement) shall, at the Company's
request, at any time and from time to time, enter into one or more agreements
supplemental to the Escrow Agreement, the NPA or the Deposit Agreement, for any
of the purposes set forth in clauses (1) through (9) of such Section 9.01, and
(without limitation of the foregoing or Section 9.01 of the Basic Agreement) (a)
clauses (2) and (3) of such Section 9.01 shall also be deemed to include the
Company's obligations under (in the case of clause (2)), and the Company's
rights and powers conferred by (in the case of clause (3)), the NPA, and (b)
references in clauses (4), (6) and (7) of such Section 9.01 to "any
Intercreditor Agreement or any Liquidity Facility" shall also be deemed to refer
to "the Intercreditor Agreement, the Liquidity Facilities, the Escrow Agreement,
the NPA or the Deposit Agreement".

            Section 6.03. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF APPLICABLE
CERTIFICATEHOLDERS. Without limitation of Section 9.02 of the Basic Agreement,
the provisions of Section 9.02 of the Basic Agreement shall apply to agreements
or amendments for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Escrow Agreement, the Deposit
Agreement or the NPA or modifying in any manner the rights and obligations of
the Applicable Certificateholders under the Escrow Agreement, the Deposit
Agreement or the NPA; provided that the provisions of Section 9.02(1) of the
Basic Agreement shall be deemed to include reductions in any manner of, or delay
in the timing of, any receipt by the Applicable Certificateholders of payments
upon the Deposits.



                                   ARTICLE VII
                            MISCELLANEOUS PROVISIONS

            Section 7.01. BASIC AGREEMENT RATIFIED. Except and so far as herein
expressly provided, all of the provisions, terms and conditions of the Basic
Agreement are in all respects ratified and confirmed; and the Basic Agreement
and this Trust Supplement shall be taken, read and construed as one and the same
instrument. All replacements of provisions of, and other modifications of the
Basic Agreement set forth in this Trust Supplement are solely with respect to
the Applicable Trust.




            SECTION 7.02. GOVERNING LAW. THE AGREEMENT AND THE APPLICABLE
CERTIFICATES HAVE BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED
BY AND 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. THIS SECTION 7.02 SUPERSEDES AND REPLACES SECTION
12.05 OF THE BASIC AGREEMENT, WITH RESPECT TO THE APPLICABLE TRUST.

            Section 7.03. 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.

            Section 7.04. INTENTION OF PARTIES. The parties hereto intend that
the Applicable 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. Each Applicable Certificateholder and Investor,
by its acceptance of its Applicable Certificate or a beneficial interest
therein, agrees to treat the Applicable Trust as a grantor trust for all U.S.
federal, state and local income tax purposes. The powers granted and obligations
undertaken pursuant to the Agreement shall be so construed so as to further such
intent.





            IN WITNESS WHEREOF, the Company and the Trustee have caused this
Trust Supplement to be duly executed by their respective officers thereto 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:




                                    EXHIBIT A


                               FORM OF CERTIFICATE

Certificate
No.____

            [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 the registered owner hereof,
Cede & Co., has an interest herein.]*



                CONTINENTAL AIRLINES PASS THROUGH TRUST 2004-ERJ1

     9.558% Continental Airlines Pass Through Certificate, Series 2004-ERJ1
                          Issuance Date: June 29, 2004

                       Final Maturity Date: March 1, 2021

      Evidencing A Fractional Undivided Interest In The Continental Airlines
      Pass Through Trust 2004-ERJ1, The Property Of Which Shall Include
      Certain Equipment Notes Each Secured By An Aircraft Leased To
      Continental Airlines, Inc.


                 $[_____________] Fractional Undivided Interest
        representing 0.000575940655% 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 2004-ERJ1 (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"), between the Trustee and Continental
Airlines, Inc., a Delaware corporation (the "COMPANY"), as supplemented by Trust


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

*   This legend to appear on Book-Entry Certificates to be deposited with the
Depository Trust Company.




Supplement No. 2004-ERJ1 thereto, dated as of June 29, 2004 (the "TRUST
SUPPLEMENT" and, together with the Basic Agreement, the "AGREEMENT"), between
the Trustee and 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 "9.558% Continental Airlines Pass Through Certificates, Series
2004-ERJ1"(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 holder of this Certificate (the
"CERTIFICATEHOLDER" and, together with all other holders of Certificates issued
by the Trust, the "CERTIFICATEHOLDERS") 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 Facilities (the
"TRUST PROPERTY"). Each issue of the Equipment Notes is secured by, among other
things, a security interest in an 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 the 1st day of each month (a "REGULAR DISTRIBUTION DATE")
commencing August 1, 2004, 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 presentation or surrender
of this Certificate or the making of any notation hereon, 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.



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
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, privileges, 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.

            Each Certificateholder and Investor, by its acceptance of this
Certificate or a beneficial interest herein, agrees to treat the Trust as a
grantor trust for all U.S. federal, state and local income tax purposes.

            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 an interest
herein are exempt from the prohibited transaction restrictions of ERISA and the
Code pursuant to one or more prohibited transaction statutory or administrative
exemptions.

            THE AGREEMENT AND THIS CERTIFICATE HAVE BEEN DELIVERED IN THE STATE
OF NEW YORK AND SHALL BE GOVERNED BY AND 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.

            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.




            IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.


                                    CONTINENTAL AIRLINES PASS THROUGH TRUST
                                    2004-ERJ1

                                    By:  WILMINGTON TRUST COMPANY,
                                         as Trustee


                                    By:
                                       -----------------------------------------
                                    Name:
                                    Title:




            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:





                                    EXHIBIT B


                         [DTC Letter of Representations]
















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

                      REVOLVING CREDIT AGREEMENT(2004-ERJ1)

                            Dated as of June 29, 2004

                                     between

                            WILMINGTON TRUST COMPANY,
              as Subordination Agent, as agent and trustee for the
              Continental Airlines Pass Through Trust 2004-ERJ1,

                                   as Borrower

                                       and

                           WESTLB AG, NEW YORK BRANCH,
                              as Liquidity Provider

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



                Continental Airlines Pass Through Trust 2004-ERJ1
             Continental Airlines 9.558% Pass Through Certificates,
                                Series 2004-ERJ1












                                TABLE OF CONTENTS

                                                                            Page


ARTICLE I  DEFINITIONS.......................................................1
      Section 1.01  Certain Defined Terms....................................1

ARTICLE II  AMOUNT AND TERMS OF THE COMMITMENT...............................7
      Section 2.01  The Advances.............................................7
      Section 2.02  Making the Advances......................................7
      Section 2.03  Fees.....................................................10
      Section 2.04  Reductions or Termination of the Maximum Commitment......10
      Section 2.05  Repayments of Interest Advances or the Final Advance.....10
      Section 2.06  Repayments of Provider Advances..........................11
      Section 2.07. Payments to the Liquidity Provider Under the
                    Intercreditor Agreement..................................12
      Section 2.08  Book Entries.............................................12
      Section 2.09  Payments from Available Funds Only.......................12
      Section 2.10  WestLB Early Termination Notice; WestLB Early
                    Termination Advance......................................12

ARTICLE III  OBLIGATIONS OF THE BORROWER.....................................13
      Section 3.01  Increased Costs..........................................13
      Section 3.02  Capital Adequacy.........................................14
      Section 3.03  Payments Free of Deductions..............................14
      Section 3.04  Payments.................................................15
      Section 3.05  Computations.............................................16
      Section 3.06  Payment on Non-Business Days.............................16
      Section 3.07  Interest.................................................16
      Section 3.08  Replacement of Borrower..................................17
      Section 3.09  Funding Loss Indemnification.............................17
      Section 3.10  Illegality...............................................18
      Section 3.11  Mitigation...............................................18

ARTICLE IV  CONDITIONS PRECEDENT.............................................18
      Section 4.01  Conditions Precedent to Effectiveness of Section 2.01....18
      Section 4.02  Conditions Precedent to Borrowing........................20

ARTICLE V  COVENANTS.........................................................20
      Section 5.01  Affirmative Covenants of the Borrower....................20
      Section 5.02  Negative Covenants of the Borrower.......................21

ARTICLE VI  LIQUIDITY EVENTS OF DEFAULT......................................21
      Section 6.01  Liquidity Events of Default..............................21

                                       i



ARTICLE VII  MISCELLANEOUS...................................................21
      Section 7.01  Amendments, Etc..........................................21
      Section 7.02  Notices, Etc.............................................22
      Section 7.03  No Waiver; Remedies......................................23
      Section 7.04  Further Assurances.......................................23
      Section 7.05  Indemnification; Survival of Certain Provisions..........23
      Section 7.06  Liability of the Liquidity Provider......................23
      Section 7.07  Costs, Expenses and Taxes................................24
      Section 7.08  Binding Effect; Participations...........................24
      Section 7.09  Severability.............................................26
      Section 7.10  GOVERNING LAW............................................26
      Section 7.11  Submission to Jurisdiction; Waiver of Jury Trial.........26
      Section 7.12  Execution in Counterparts................................27
      Section 7.13  Entirety.................................................27
      Section 7.14  Headings.................................................27
      Section 7.15  LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES.........27


ANNEX I     Interest Advance Notice of Borrowing

ANNEX II    WestLB Early Termination 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

ANNEX VII   WestLB Expiration Advance Notice of Borrowing












                                       ii




                    REVOLVING CREDIT AGREEMENT (2004-ERJ1)



            This REVOLVING CREDIT AGREEMENT (2004-ERJ1), dated as of June 29,
2004, is made by and 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
Trust (as defined below) (the "BORROWER"), and WESTLB AG, a joint stock company
("Aktiengesellschaft") organized under the laws of Germany, acting through its
New York Branch (the "LIQUIDITY PROVIDER").

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

            WHEREAS, pursuant to the Trust Agreement (such term and all other
capitalized terms used in these recitals having the meanings set forth or
referred to in Section 1.01), the Trust is issuing the Certificates; and

            WHEREAS, the Borrower, in order to support the timely payment of a
portion of the interest on the 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 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.   CERTAIN DEFINED TERMS.

            (a)   As used in this Agreement and unless 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 COSTS" has the meaning assigned to such term in Section
3.01.

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

            "AGREEMENT" means this Revolving Credit Agreement (2004-ERJ1), dated
as of June 29, 2004, between the Borrower and the Liquidity Provider, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.

            "APPLICABLE LIQUIDITY RATE" has the meaning assigned to such term in
Section 3.07(f).




            "APPLICABLE MARGIN" means (i) with respect to any Unpaid Advance or
Applied Provider Advance, 2.75% per annum and (ii) with respect to any Unapplied
Provider Advance, the rate per annum specified in the Fee Letter applicable to
this Agreement.

            "APPLIED DOWNGRADE ADVANCE" has the meaning assigned to such term in
Section 2.06(a).

            "APPLIED WESTLB EARLY TERMINATION ADVANCE" has the meaning assigned
to such term in Section 2.06(a).

            "APPLIED PROVIDER ADVANCE" has the meaning assigned to such term in
Section 2.06(a).

            "APPLIED WESTLB EXPIRATION ADVANCE" has the meaning assigned to such
term in Section 2.06(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, 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 is outstanding, the
city and state in which the 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.

            "DEPOSIT AGREEMENT" means the Deposit Agreement dated as of the date
hereof between Wells Fargo Bank Northwest, National Association, as Escrow
Agent, and WestLB AG, New York Branch, as Depositary, pertaining to the
Certificates, as the same may be amended, modified or supplemented from time to
time in accordance with the terms thereof.

            "DEPOSITARY" has the meaning assigned to such term in the Deposit
Agreement.



            "DEPOSITS" has the meaning assigned to such term in the Deposit
Agreement.

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

            "DOWNGRADE EVENT" means a downgrading of the Liquidity Provider's
short-term unsecured debt rating or short-term issuer credit rating, as the case
may be, issued by either Rating Agency below the applicable Threshold Rating
unless each Rating Agency shall have confirmed in writing on or prior to the
date of such downgrading that such downgrading will not result in the
downgrading, withdrawal or suspension of the ratings of the Certificates, in
which case such downgrading of the Liquidity Provider's short-term unsecured
debt rating or short-term issuer credit rating, as the case may be, shall not
constitute a Downgrade Event.

            "EFFECTIVE DATE" has the meaning assigned to such term in Section
4.01. The delivery of the certificate of the Liquidity Provider contemplated by
Section 4.01(e) shall be conclusive evidence that the Effective Date has
occurred.

            "EXCLUDED TAXES" means (i) Taxes imposed on, based on or measured by
the income of, or franchise Taxes imposed on, the Liquidity Provider or its
Lending Office by the jurisdiction where such Liquidity Provider's principal
office or such Lending Office is located or any other taxing jurisdiction in
which such Tax is imposed as a result of the Liquidity Provider being, or having
been, organized in, or conducting, or having conducted, any activities unrelated
to the transactions contemplated by the Operative Agreements in, such
jurisdiction or (ii) withholding taxes, whether or not indemnified under Section
3.03.

            "EXCLUDED WITHHOLDING TAXES" means (i) withholding Taxes imposed by
the United States except to the extent that such United States withholding Taxes
are imposed or increased as a result of a change in applicable law after the
date hereof and, in the case of any successor Liquidity Provider, any
withholding Tax imposed by the United States except (a) if such Liquidity
Provider is, on the date it acquires its interest herein, a "resident" of an
Applicable Treaty jurisdiction entitled to claim the benefits of an Applicable
Treaty in respect of amounts payable hereunder, any such withholding Tax to the
extent imposed as a result of a change in applicable law (other than any
addition of, or change in, any "anti-treaty shopping", "limitation on benefits",
or similar provision in any treaty or other applicable law restricting the
availability of treaty benefits (including, without limitation any provision
similar to the Protocol Amending the Convention Between the United States of
America and the Kingdom of the Netherlands for the Avoidance of Double Taxation
and the Prevention of Fiscal Evasion with respect to Taxes on Income, signed at
Washington on October 13, 1993)) after the date such Liquidity Provider acquired
its interest herein and (b) any such withholding Tax to the extent the amount of
such withholding Tax imposed on such successor Liquidity Provider does not
exceed the amount of such withholding Tax that, in the absence of the transfer
to such Liquidity Provider, would have been an Indemnified Tax imposed on
payments to the predecessor Liquidity Provider pursuant to applicable law in
effect on the date such successor Liquidity Provider acquired its interest
herein, (ii) any Tax imposed or to the extent increased as a result of the
Liquidity Provider failing to deliver to the Borrower any certificate or
document (the delivery of which certificate or document in the good faith
judgment of the Liquidity Provider will not expose the Liquidity Provider to any
adverse consequence and which the Liquidity Provider 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, and (iii) any Tax imposed by a jurisdiction as a result of the
Liquidity Provider being, or having been, organized in, or maintaining, or
having maintained, its principal office or Lending Office in, or conducting, or
having conducted, any activities unrelated to the transactions contemplated by
the Operative Agreements in, such jurisdiction. For purposes of this definition,
"Applicable Treaty" means an income tax treaty between the United States and any
of Australia, Austria, Canada, France, Germany, Ireland, Japan, Luxembourg, The
Netherlands, Sweden, Switzerland or the United Kingdom.

            "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 other than sales, use and V.A.T. taxes imposed on fees and expenses
payable pursuant to Section 7.07.

            "EXPIRY DATE" means December 16, 2015.

            "FINAL ADVANCE" means an Advance made pursuant to Section 2.02(d).

            "INDEMNIFIED TAX" has the meaning assigned to such term in Section
3.03.

            "INTERCREDITOR AGREEMENT" means the Intercreditor Agreement dated as
of the date hereof, among the Trustee, the Liquidity Provider, the other
liquidity provider party thereto 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
2.02(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 (A) the Liquidity Provider's receipt of the Notice of
                  Borrowing for such LIBOR Advance or (B) the withdrawal of
                  funds from the Cash Collateral Account for the purpose of
                  paying interest on the Certificates as contemplated by Section
                  2.06(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.

            "LENDING OFFICE" means the lending office of the Liquidity Provider
presently located at New York, New York, 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 another lending office outside the United States of America
except in accordance with Section 3.11 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,

            (i)   the rate per annum appearing on display page 3750 (British
                  Bankers Association-LIBOR) of the Telerate Service (or any
                  successor or substitute therefor) at approximately 11:00 a.m.
                  (London time) two Business Days before the first day of such
                  Interest Period, as the rate for dollar deposits with a
                  maturity comparable to such Interest Period, or

            (ii)  if the rate calculated pursuant to clause (i) above is not
                  available, the average (rounded upwards, if necessary, to the
                  next 1/16 of 1%) of the rates per annum at which deposits in
                  dollars are offered for the relevant Interest Period by three
                  banks of recognized standing selected by the Liquidity
                  Provider 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 LIBOR Advance to which such Interest
                  Period is to apply and for a period comparable to such
                  Interest Period.

            "LIQUIDITY EVENT OF DEFAULT" means the occurrence of either (a) the
Acceleration of all of the Equipment Notes (PROVIDED that, with respect to the
period prior to the Delivery Period Expiry Date, such Equipment Notes have an
aggregate outstanding principal balance in excess of $108,000,000) 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" means, subject to the proviso
contained in the third sentence of Section 2.02(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 initially $15,827,353.87, as the same may
be reduced from time to time in accordance with Section 2.04(a).

            "NOTICE OF BORROWING" has the meaning assigned to such term in
Section 2.02(f).

            "NOTICE OF REPLACEMENT SUBORDINATION AGENT" has the meaning assigned
to such term in Section 3.08.



            "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 SUPPLEMENT" means the final Prospectus Supplement dated
June 18, 2004 relating to the Certificates, as such Prospectus Supplement may be
amended or supplemented.

            "PROVIDER ADVANCE" means a Downgrade Advance, a WestLB Early
Termination Advance or a WestLB Expiration Advance.

            "REGULATORY CHANGE" has the meaning assigned to such term in Section
3.01.

            "REPLENISHMENT AMOUNT" has the meaning assigned to such term in
Section 2.06(b).

            "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 Certificates have been paid in full (or provision has
been made for such payment in accordance with the Intercreditor Agreement and
the Trust Agreement) 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 or Special Termination Notice from the Liquidity Provider
pursuant to Section 6.01 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.

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

            "UNAPPLIED WESTLB EARLY TERMINATION ADVANCE" means any portion of a
WestLB Early Termination Advance which is not an Applied WestLB Early
Termination Advance.

            "UNAPPLIED PROVIDER ADVANCE" means any portion of any Provider
Advance which is not an Applied Provider Advance.

            "UNAPPLIED WESTLB EXPIRATION ADVANCE" means any portion of a WestLB
Expiration Advance that is not an Applied WestLB Expiration Advance.

            "UNPAID ADVANCE" has the meaning assigned to such term in Section
2.05.

            "WESTLB EARLY TERMINATION ADVANCE" means an Advance made pursuant to
Section 2.02(b).



            "WESTLB EARLY TERMINATION DATE" means the date specified in a WestLB
Early Termination Notice delivered by the Liquidity Provider to the Borrower in
accordance with Section 2.10, which date shall not be earlier than the 25th day
following the receipt by the Borrower of such WestLB Early Termination Notice.

            "WESTLB EARLY TERMINATION NOTICE" has the meaning assigned to such
term in Section 2.10.

            "WESTLB EARLY TERMINATION NOTICE PERIOD" means the period from the
40th day to and including the 25th day prior to each anniversary of the Closing
Date.

            "WESTLB TERMINATION DATE" has the meaning assigned to such term in
Section 2.02(e).

            "WESTLB EXPIRATION ADVANCE" means an Advance made pursuant to
Section 2.02(e).

            (b) For the purposes of this Agreement, the following terms shall
have the respective meanings assigned to such terms in the Intercreditor
Agreement:

            "ACCELERATION", "CASH COLLATERAL ACCOUNT", "CERTIFICATE",
"CERTIFICATEHOLDER", "CLOSING DATE", "CONTINENTAL", "CONTINENTAL BANKRUPTCY
EVENT", "CONTROLLING PARTY", "CORPORATE TRUST OFFICE", "DELIVERY PERIOD EXPIRY
DATE", "DISTRIBUTION DATE", "DOWNGRADED FACILITY", "EARLY TERMINATED FACILITY",
"EQUIPMENT NOTES", "FEE LETTER", "FINAL LEGAL DISTRIBUTION DATE", "FINANCING
AGREEMENT", "INDENTURE", "INVESTMENT EARNINGS", "LIQUIDITY OBLIGATIONS", "LOAN
TRUSTEE", "MOODY'S", "NON-EXTENDED FACILITY", "NOTE PURCHASE AGREEMENT",
"OPERATIVE AGREEMENTS", "PARTICIPATION AGREEMENT", "PERFORMING EQUIPMENT NOTE",
"PERSON", "POOL BALANCE", "RATING AGENCIES", "RATINGS CONFIRMATION", "REGULAR
DISTRIBUTION DATES", "REPLACEMENT LIQUIDITY FACILITY", "REQUIRED AMOUNT",
"RESPONSIBLE OFFICER", "SCHEDULED PAYMENT", "SPECIAL PAYMENT", "STANDARD &
POOR'S", "STATED INTEREST RATE", "SUB-ACCOUNT", "SUBORDINATION AGENT", "TAXES",
"THRESHOLD RATING", "TRUST", "TRUST AGREEMENT", "TRUSTEE", "UNDERWRITERS",
"UNDERWRITING AGREEMENT", "WESTLB FEE LETTER", "WESTLB SUB-ACCOUNT", "WESTLB
EXPIRED FACILITY" and "WRITTEN NOTICE".


                                   ARTICLE II

                       AMOUNT AND TERMS OF THE COMMITMENT

            Section 2.01.   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 1:00 p.m. (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 2.04(b)) in an aggregate amount at any time
outstanding not to exceed the Maximum Commitment.

            Section 2.02.   MAKING THE ADVANCES. (a) 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 interest with respect to the
Certificates at the Stated Interest Rate therefor in accordance with Sections
3.6(a) and 3.6(b) 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 or in part of the
amount of any Interest Advance made pursuant to this Section 2.02(a), together
with accrued interest thereon (as provided herein), the Maximum Available
Commitment shall be reinstated by an amount equal to the amount of such Interest
Advance so repaid but not to exceed the Maximum Commitment; PROVIDED, HOWEVER,
that the Maximum Available Commitment shall not be so reinstated at any time if
(x) both a Performing Note Deficiency exists and a Liquidity Event of Default
shall have occurred and be continuing, or (y) a Final Advance or a Provider
Advance has been made.

            (b)   Subject to Section 2.10, a WestLB Early Termination Advance
shall be made in a single Borrowing if this Agreement is terminated by the
Liquidity Provider in accordance with Section 3.6(d)(ii) of the Intercreditor
Agreement (unless a Replacement Liquidity Facility to replace this Agreement
shall have been delivered to the Borrower as contemplated by said Section
3.6(d)(ii) within the time period specified in such Section 3.6(d)(ii)) 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 WestLB Sub-Account of the
Cash Collateral Account in accordance with Sections 3.6(d)(ii) and 3.6(f) of the
Intercreditor Agreement.

            (c)   A Downgrade Advance shall be made in a single Borrowing upon
the occurrence of a Downgrade Event (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 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
WestLB Sub-Account of the Cash Collateral Account in accordance with Sections
3.6(c) and 3.6(f) of the Intercreditor Agreement.

            (d)   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 6.01 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 WestLB Sub-Account of the Cash Collateral Account in accordance with
Sections 3.6(f) and 3.6(i) of the Intercreditor Agreement.

            (e)   A WestLB Expiration Advance shall be made in a single
Borrowing if on December 1, 2015 (the "WESTLB TERMINATION DATE") the Maximum
Available Commitment hereunder is greater than zero by delivery to the Liquidity



Provider of a written and completed Notice of Borrowing in substantially the
form of Annex VII 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 WestLB Sub-Account of the Cash Collateral Account
in accordance with Sections 3.6(f) and 3.6(l) of the Intercreditor Agreement.

            (f)   Each Borrowing shall be made on notice in writing (a "NOTICE
OF BORROWING") in substantially the form required by Section 2.02(a), 2.02(b),
2.02(c), 2.02(d) or 2.02(e), as the case may be, given by the Borrower to the
Liquidity Provider. Each Notice of Borrowing shall be effective upon delivery of
a copy thereof to the Liquidity Provider's office at the address specified in
Section 7.02. If a Notice of Borrowing is delivered by the Borrower in respect
of any Borrowing no later than 1:00 p.m. (New York City time) on a Business Day,
upon satisfaction of the conditions precedent set forth in Section 4.02 with
respect to a requested Borrowing, the Liquidity Provider shall make available to
the Borrower, in accordance with its payment instructions, the amount of such
Borrowing in U.S. dollars and immediately available funds, before 4:00 p.m. (New
York City time) on such Business Day or on such later Business Day specified in
such Notice of Borrowing. If a Notice of Borrowing is delivered by the Borrower
in respect of any Borrowing on a day that is not a Business Day or after 1:00
p.m. (New York City time) on a Business Day, upon satisfaction of the conditions
precedent set forth in Section 4.02 with respect to a requested Borrowing, the
Liquidity Provider shall make available to the Borrower, in accordance with its
payment instructions, the amount of such Borrowing in U.S. dollars and in
immediately available funds, 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 by the Borrower in such Notice of 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.

            (g)   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. If the
Liquidity Provider makes an Advance requested pursuant to a Notice of Borrowing
before 12:00 noon (New York City time) on the second Business Day after the date
of payment specified in Section 2.02(f), the Liquidity Provider shall have fully
discharged its obligations hereunder with respect to such Advance and an event
of default shall not have occurred hereunder. Following the making of any
Advance pursuant to Section 2.02(b), 2.02(c), 2.02(d) or 2.02(e) hereof to fund
the WestLB Sub-Account of the Cash Collateral Account, the Liquidity Provider
shall have no interest in or rights to the Cash Collateral Account, any
Sub-Account thereof, the funds constituting such Advance or any other amounts
from time to time on deposit in the Cash Collateral Account or any Sub-Account
thereof; 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 3.6(f) of the Intercreditor Agreement and PROVIDED FURTHER, that the
foregoing shall not affect or impair the rights of the Liquidity Provider to
provide written instructions with respect to the investment and reinvestment of
amounts in the WestLB Sub-Account of the Cash Collateral Account to the extent



provided in Section 2.2(b) 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 2.03.   FEES. The Borrower agrees to pay to the Liquidity
Provider the fees set forth in the Fee Letter applicable to this Agreement.

            Section 2.04.   REDUCTIONS OR TERMINATION OF THE MAXIMUM COMMITMENT.

            (a)   AUTOMATIC REDUCTION. Promptly following each date on which the
Required Amount with respect to this Agreement is reduced as a result of a
reduction (or deemed reduction) in the Pool Balance of the Certificates or
otherwise, the Maximum Commitment shall automatically be reduced to an amount
equal to such reduced Required Amount (as calculated by the Borrower); PROVIDED
that on the first Regular Distribution Date, the Maximum Commitment shall
automatically be reduced to the Required Amount then in effect with respect to
this Agreement. 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.

            (b)   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 2.05.   REPAYMENTS OF INTEREST ADVANCES OR THE FINAL
ADVANCE. Subject to Sections 2.06, 2.07 and 2.09 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 3.07 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 2.05 or (ii) this Liquidity Facility shall become a
Downgraded Facility, an Early Terminated Facility or a WestLB Expired 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, an Applied WestLB Early Termination Advance or an
Applied WestLB Expiration 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 2.06 and for the purposes of Section 2.06(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 2.06.   REPAYMENTS OF PROVIDER ADVANCES. (a) Amounts
advanced hereunder in respect of a Provider Advance shall be deposited in the
WestLB Sub-Account of the Cash Collateral Account and invested and withdrawn
from the WestLB Sub-Account of the Cash Collateral Account as set forth in
Sections 3.6(c), 3.6(d), 3.6(e), 3.6(f) and 3.6(l) of the Intercreditor
Agreement. Subject to Sections 2.07 and 2.09, 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 3.07
hereof; PROVIDED, HOWEVER, that amounts in respect of a Provider Advance
withdrawn from the WestLB Sub-Account of the Cash Collateral Account for the
purpose of paying interest on the Certificates in accordance with Section 3.6(f)
of the Intercreditor Agreement (the amount of any such withdrawal being (x) in
the case of a Downgrade Advance, an "APPLIED DOWNGRADE ADVANCE", (y) in the case
of a WestLB Early Termination Advance, an "APPLIED WESTLB EARLY TERMINATION
ADVANCE" and (z) in the case of a WestLB Expiration Advance, an "APPLIED WESTLB
EXPIRATION ADVANCE" and, together with an Applied Downgrade Advance and Applied
WestLB Early Termination Advance, an "APPLIED PROVIDER ADVANCE") shall
thereafter (subject to Section 2.06(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 6.01 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 and
the obligation for repayment thereof. Subject to Sections 2.07 and 2.09 hereof,
immediately upon the withdrawal of any amounts from the WestLB Sub-Account of
the Cash Collateral Account pursuant to Section 3.6(f) of the Intercreditor
Agreement on account of a reduction (or deemed reduction) in the Required Amount
with respect to such Sub-Account, the Borrower shall repay to the Liquidity
Provider a portion of the Provider Advances in a principal amount equal to such
reduction, plus interest on the principal amount prepaid as provided in Section
3.07 hereof.

            (b)   At any time when an Applied Provider Advance (or any portion
thereof) is outstanding, upon the deposit in the WestLB Sub-Account of the 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 with respect to such
Sub-Account 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.

            (c)   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 WestLB Sub-Account



of the Cash Collateral Account after giving effect to any Applied Provider
Advance on the date of such replacement shall be reimbursed to the replaced
Liquidity Provider, but only to the extent such amounts are necessary to repay
in full to the replaced Liquidity Provider all amounts owing to it hereunder.

            Section 2.07.   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
and shall discharge in full the corresponding obligations of the Borrower
hereunder (or, if not provided for in the Intercreditor Agreement, then in such
manner as the Liquidity Provider shall deem appropriate).

            Section 2.08.   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 2.09.   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 the
WestLB Fee Letter, Section 9.1 of the Participation Agreements and Section 6 of
the Note Purchase Agreement 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 and other applicable 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 WestLB Sub-Account of the 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. Amounts on deposit in the other Sub-Account in respect of the
Certificates shall not be available to make payments under this Agreement.

            Section 2.10.   WESTLB EARLY TERMINATION NOTICE; WESTLB EARLY
TERMINATION ADVANCE. At any time during the WestLB Early Termination Notice
Period, the Liquidity Provider shall have the right in its sole discretion to
terminate its obligations to make Advances under this Agreement upon not less
than 25 days' written notice (the "WESTLB EARLY TERMINATION NOTICE") to the
Borrower. If the Liquidity Provider delivers a WestLB Early Termination Notice
to the Borrower during the WestLB Early Termination Notice Period (and, in each



case, if the Liquidity Provider shall not have been replaced in accordance with
Section 3.6(e) of the Intercreditor Agreement on or before the expiry of the
WestLB Early Termination Notice Period), the Borrower shall be entitled at any
time prior to the WestLB Early Termination Date, to request a WestLB Early
Termination Advance in accordance with Section 2.02(b) hereof and Section
3.6(d)(ii) of the Intercreditor Agreement.


                                   ARTICLE III

                           OBLIGATIONS OF THE BORROWER

            Section 3.01.   INCREASED COSTS. 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 of the Board of Governors of the Federal Reserve
System), 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 or such obligation (other than with respect to
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 such obligation or any deposits
referred to in the definition of LIBOR Rate or related definitions).

            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 3.01 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 3.01 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.

            Notwithstanding the preceding two paragraphs, the Liquidity Provider
and the Subordination Agent agree that any permitted assignee or participant of
the initial Liquidity Provider which is not a bank shall not be entitled to the
benefits of the preceding two paragraphs (but without limiting the provisions of
Section 7.08 hereof).



            Section 3.02.   CAPITAL ADEQUACY. 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, subject to the provisions of
Section 3.11, 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 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 3.02 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 3.02 of the effect of any increase in the amount of
capital required to be maintained by the Liquidity Provider 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.

            Notwithstanding the preceding two paragraphs, the Liquidity Provider
and the Subordination Agent agree that any permitted assignee or participant of
the initial Liquidity Provider which is not a bank shall not be entitled to the
benefits of the preceding two paragraphs (but without limiting the provisions of
Section 7.08 hereof).

            Section 3.03.   PAYMENTS FREE OF DEDUCTIONS. (a) All payments made
by the Borrower under this Agreement shall be made without reduction or
withholding for or on account of any present or future Taxes of any nature
whatsoever now or hereafter imposed, levied, collected, withheld or assessed,
other than Excluded Withholding Taxes (such non-excluded Taxes being referred to
herein, collectively, as "INDEMNIFIED TAXES" and, individually, as an
"INDEMNIFIED TAX") unless such reduction or withholding is required by
applicable law. If any Taxes are required to be withheld from any amounts
payable to the Liquidity Provider under this Agreement, (i) the Borrower shall
within the time prescribed therefor by applicable law pay to the appropriate
governmental or taxing authority the full amount of any such Taxes (including
any additional Tax required to be deducted or withheld in respect of the
additional amounts payable under clause (ii) hereof) and make such reports or
returns in connection therewith at the time or times and in the manner
prescribed by applicable law, and (ii) in the case of Indemnified Taxes, the
amounts payable to the Liquidity Provider shall be increased to the extent
necessary to yield to the Liquidity Provider (after deduction or withholding for
or on account of all Indemnified Taxes and any additional Taxes required to be
deducted or withheld or payable by the Liquidity Provider by reason of the
receipt or accrual of the additional amounts payable pursuant to this clause
(ii)) interest or any other such amounts payable under this Agreement at the



rates or in the amounts specified in this Agreement. If the Liquidity Provider
(including a successor Liquidity Provider) is not organized under the laws of
the United States or any State thereof, to the extent it is eligible to do so,
the Liquidity Provider agrees to provide to the Borrower, prior to the first
date any amount is payable to it hereunder, two executed original copies of
Internal Revenue Service Form W-8BEN or W-8ECI, 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. In addition, the
Liquidity Provider will provide, from time to time upon the reasonable request
of the Borrower, such additional forms or documentation as may be necessary to
establish an available exemption from (or an entitlement to a reduced rate of)
withholding Tax on payments hereunder. Within 30 days after the date of each
payment hereunder, the Borrower shall furnish to the Liquidity Provider an
original or certified copy of a receipt (or other documentary evidence
reasonably acceptable to the Liquidity Provider) evidencing the payment of the
Taxes applicable to such payment.

            (b)   If the Liquidity Provider (including a successor Liquidity
Provider) is not organized under the laws of the United States or any State
thereof, all Advances made by the Liquidity Provider under this Agreement shall
be made free and clear of, and without reduction for or on account of, any Taxes
that are imposed by a jurisdiction in which the Liquidity Provider is organized,
has its Lending Office or maintains its principal place of business unless such
reduction or withholding is required by applicable law. If any such Taxes are
required to be withheld or deducted from any Advances, the Liquidity Provider
shall (i) within the time prescribed therefor by applicable law pay to the
appropriate governmental or taxing authority the full amount of any such Taxes
(and any additional Taxes in respect of the additional amounts payable under
clause (ii) hereof) and make such reports or returns in connection therewith at
the time or times and in the manner prescribed by applicable law, and (ii) pay
to the Borrower an additional amount which (after deduction of all such Taxes)
shall be sufficient to yield to the Borrower the full amount that would have
been received by it had no such withholding or deduction been required. The
Borrower shall, for United States federal income tax purposes and for all
purposes hereunder, treat such payments as Interest Advances, and, as such, will
treat such payments as loans made by the Liquidity Provider to the Borrower,
unless otherwise required by law (it being understood and agreed that the
treatment of such additional amounts shall not reduce the Maximum Available
Commitment hereunder). Within 30 days after the date of each payment hereunder,
the Liquidity Provider shall furnish to the Borrower an original or certified
copy of a receipt (or other documentary evidence reasonably acceptable to the
Borrower) evidencing the payment of the Taxes applicable to such payment.

            (c)   If any exemption from, or reduction in the rate of, any Taxes
required to be deducted or withheld from amounts payable by the Liquidity
Provider hereunder is reasonably available to the Borrower to establish that
payments under this Agreement are exempt from (or entitled to a reduced rate of)
Tax, the Borrower shall deliver to the Liquidity Provider such form or forms and
such other evidence of the eligibility of the Borrower for such exemption or
reduction as the Liquidity Provider may reasonably identify to the Borrower as
being required as a condition to exemption from, or reduction in the rate of,
any such Taxes.

            Section 3.04.   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 U.S. dollars, to the Liquidity Provider in immediately available funds, by
wire transfer to the account of JP Morgan Chase, One Chase Manhattan Plaza, New
York, NY 10005, ABA #021-000021 for the account of WestLB AG, New York Branch,
Account # 920-1-060663, for further credit to Continental Airlines EETC
2004-ERJ1 account, ref 69170; or to such other U.S. bank account as the
Liquidity Provider may from time to time direct the Subordination Agent.

            Section 3.05.   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 3.06.   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 (if such Advance
is a LIBOR 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 3.07.   INTEREST. (a) Subject to Section 2.09, 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 WestLB Sub-Account of
the Cash Collateral Account to pay interest on the 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 WestLB Sub-Account of the
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) that 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 the
case may be, 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 3.07 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 3.07 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 3.07 had at all times been in effect.

            (b)   Each Advance (including, without limitation, each outstanding
Unapplied Provider Advance) will be either a Base Rate Advance or a LIBOR



Advance as provided in this Section 3.07. Each such 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 a 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 (or, if
such Final Advance is deemed to have been made, without delivery of a Notice of
Borrowing pursuant to Section 2.06, by requesting, prior to 11:00 a.m. (New York
City time) on the first Business Day immediately following the Borrower's
receipt of the applicable Termination Notice, that such Final Advance not be
converted from a Base Rate Advance to a LIBOR Advance).

            (c)   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).

            (d)   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).

            (e)   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.

            (f)   Each change in the Base Rate shall become effective
immediately. The rates of interest specified in this Section 3.07 with respect
to any Advance or other amount shall be referred to as the "APPLICABLE LIQUIDITY
RATE".

            Section 3.08.   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 the Borrower for all purposes
hereunder.

            Section 3.09.   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:

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

            (2)   Any failure by the Borrower to borrow a LIBOR Advance on the
      date for borrowing specified in the relevant notice under Section 2.02.

            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.

            Section 3.11.   MITIGATION. If a condition arises or an event occurs
which would, or would upon the giving of notice, result in the payment of any
additional costs or amounts pursuant to Section 3.01, 3.02 or 3.03 or require
the conversion of any Advance pursuant to Section 3.10, the Liquidity Provider,
promptly upon becoming aware of the same, shall notify the Borrower and shall
use reasonable efforts (consistent with applicable legal and regulatory
restrictions) to mitigate the effects of such condition or event, including the
designation of a different Lending Office or furnishing of the proper
certificates under any applicable tax laws, tax treaties and conventions to the
extent that such certificates are legally available to the Liquidity Provider;
PROVIDED, that the Liquidity Provider shall be under no obligation to take any
step that, in its good-faith opinion would (i) result in its incurring any
additional costs in performing its obligations hereunder unless the Borrower has
agreed to reimburse it therefor or (ii) be otherwise disadvantageous to the
Liquidity Provider in the reasonable judgment of the Liquidity Provider.


                                   ARTICLE IV

                              CONDITIONS PRECEDENT

            Section 4.01.   CONDITIONS PRECEDENT TO EFFECTIVENESS OF SECTION
2.01. Section 2.01 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:



            (a)   The Liquidity Provider shall have received 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 and the
                  Fee Letter applicable to this Agreement duly executed on
                  behalf of each of the parties thereto (other than the
                  Liquidity Provider);

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

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

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

            (v)   An executed copy of each document, instrument, certificate and
                  opinion delivered on or before the Closing Date pursuant to
                  the Trust Agreement, the Intercreditor Agreement and the other
                  Operative Agreements (in the case of each such opinion, other
                  than the opinion of counsel for the Underwriters, either
                  addressed to the Liquidity Provider or accompanied by 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 Trustee, 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
                  pertaining to the transactions contemplated hereby or by the
                  other Operative Agreements as the Liquidity Provider shall
                  have reasonably requested.

            (b)   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.

            (c)   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.

            (d)   All conditions precedent to the issuance of the Certificates
under the Trust Agreement shall have been satisfied or waived, all conditions
precedent to the effectiveness of the other Liquidity Facility shall have been
satisfied or waived, and all conditions precedent to the purchase of the
Certificates by the Underwriters under the Underwriting Agreement shall have
been satisfied or waived.

            (e)   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 2.01
have been satisfied or waived.

            Section 4.02.   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, on or 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 Advance requested.


                                    ARTICLE V

                                    COVENANTS

            Section 5.01.   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:

            (a)   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.




            (b)   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.

            (c)   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 5.02.   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 prior written consent
of the Liquidity Provider, which consent shall not be unreasonably withheld or
delayed.


                                   ARTICLE VI

                           LIQUIDITY EVENTS OF DEFAULT

            Section 6.01.   LIQUIDITY EVENTS OF DEFAULT. If (i) any Liquidity
Event of Default has occurred and is continuing and (ii) 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 (w) the
obligation of the Liquidity Provider to make Advances hereunder to expire on the
fifth Business Day after the date on which such Termination Notice is received
by the Borrower, (x) the Borrower to promptly request, and the Liquidity
Provider to promptly make, a Final Advance in accordance with Section 2.02(d)
hereof and Section 3.6(i) of the Intercreditor Agreement, (y) all other
outstanding Advances to be automatically converted into Final Advances for
purposes of determining the Applicable Liquidity Rate for interest payable
thereon, and (z) subject to Sections 2.07 and 2.09 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 7.01.   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 7.02.   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 Street
                            Wilmington, DE 19890-0001
                            Attention:  Corporate Trust Administration
                            Telephone: (800) 733-8485
                            Telecopy: (302) 651-8882

      Liquidity Provider:   WestLB AG, New York Branch
                            1211 Avenue of the Americas
                            New York, New York 10036
                            Reference:  Continental Airlines Pass Through Trust
                                        2004-ERJ1
                            Attention: Brigitte Thieme
                            Telephone: (212) 852-6111
                            Telecopy: (212) 869-7634

                            with a copy to:

                            WestLB AG, New York Branch
                            1211 Avenue of the Americas
                            New York, New York 10036
                            Attention: Michael Sassos
                            Telephone: (212) 852-5973
                            Telecopy: (212) 852-6228

                            and

                            WestLB AG, New York Branch
                            1211 Avenue of the Americas
                            New York, New York 10036
                            Attention:  Jesus Sang
                            Telephone: (212) 852-6389
                            Telecopy: (212) 302-7946

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 Article II and Article 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 7.03.   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 7.04.   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 7.05.   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 Section 3.01, 3.02 or 7.07 hereof or in the Fee Letter applicable
to this Agreement (regardless of whether indemnified against pursuant to said
Sections or in such Fee Letter)), that may be imposed on, 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 applicable to this Agreement, 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; (iii) attributable to the failure by the
Liquidity Provider to perform or observe any agreement, covenant or condition on
its part to be performed or observed in this Agreement or the Intercreditor
Agreement, or (iv) a Tax. The indemnities contained in Section 9.1 of the
Participation Agreements, and the provisions of Sections 3.01, 3.02, 3.03, 3.09,
7.05 and 7.07 hereof, shall survive the termination of this Agreement.

            Section 7.06.   LIABILITY OF THE LIQUIDITY PROVIDER. (a) 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 gross
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 or the Intercreditor 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. In no event, however, shall the Liquidity
Provider be liable on any theory of liability for any special, indirect,
consequential or punitive damages (including, without limitation, any loss of
profits, business or anticipated savings).

            (b)   Neither the Liquidity Provider nor any of its officers,
employees, directors 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 gross 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 7.07.   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 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 any
waiver or consent thereunder (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 Account. 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 hold 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 7.08.   BINDING EFFECT; PARTICIPATIONS. (a) 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 7.08) nor
(except as contemplated by Section 3.08) 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
7.08(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 (other than Continental and its
Affiliates) as the Liquidity Provider may in its sole discretion select, subject
to the requirements of Section 7.08(b). No such granting of participations 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. 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 3.03 and the like as they pertain to the Liquidity Provider shall be
deemed also to include those of each of its participants that are banks
(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).

            (b)   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 W-8ECI or Form W-8BEN, 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 W-8ECI or Form W-8BEN, 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 W-8BEN or Form
W-8ECI 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.

            (c)   Notwithstanding the other provisions of this Section 7.08, 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 7.09.   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 non-authorization 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.
(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 of mail), postage prepaid, to each party hereto at its
                  address set forth in Section 7.02 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.

            (b)   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 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 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.

            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.






            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 Trust, as Borrower


                                    By___________________________________
                                    Name:
                                    Title:


                                    WESTLB AG, acting through its New York
                                    Branch, as Liquidity Provider


                                    By___________________________________
                                    Name:
                                    Title:


                                    By___________________________________
                                    Name:
                                    Title:






                                                                      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 WESTLB AG, acting through its New
York Branch (the "LIQUIDITY PROVIDER"), with reference to the Revolving Credit
Agreement (2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2)   The Borrower is delivering this Notice of Borrowing for the
      making of an Interest Advance by the Liquidity Provider to be used,
      subject to clause (3)(v) below, for the payment of interest on the
      Certificates which was payable on ____________, ____ (the "DISTRIBUTION
      DATE") in accordance with the terms and provisions of the Trust Agreement
      and the Certificates, which Advance is requested to be made on
      ____________, ____. The Interest Advance should be transferred to [name of
      bank/wire instructions/ABA number] in favor of account number [ __ ],
      reference [ __ ].

            (3)   The amount of the Interest Advance requested hereby (i) is
      $_______________.__, to be applied in accordance with Sections 3.6(a) and
      3.6(b) of the Intercreditor Agreement in respect of the payment of the
      interest which was due and payable on the Certificates on the Distribution
      Date, (ii) does not include any amount with respect to the payment of
      principal of, or premium on, the Certificates, (iii) was computed in
      accordance with the provisions of the Certificates, the 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, (v) does not include any amount of interest
      which was due and payable on the Certificates on such Distribution Date
      but which remains unpaid due to the failure of the Depositary to pay any
      amount of accrued interest on the Deposits on such Distribution Date and
      (vi) has not been and is not the subject of a prior or contemporaneous
      Notice of Borrowing.

            (4)   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 Notice of Borrowing

                                      I-1



and such 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 _________, ____.


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

                                    By:___________________________________
                                    Name:
                                    Title:
























                                      I-2



               SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING

        [Insert copy of computations in accordance with Interest Advance
                              Notice of Borrowing]



























                                      I-3



                                                                     Annex II to
                                                      Revolving Credit Agreement

              WESTLB EARLY TERMINATION ADVANCE NOTICE OF BORROWING

            The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to WESTLB AG, acting through its New
York Branch (the "LIQUIDITY PROVIDER"), with reference to the Revolving Credit
Agreement (2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2)   The Borrower is delivering this Notice of Borrowing for the
      making of the WestLB Early Termination Advance by the Liquidity Provider
      to be used for the funding of the WestLB Sub-Account of the Cash
      Collateral Account in accordance with Section 3.6(d)(ii) of the
      Intercreditor Agreement, which Advance is requested to be made on
      __________, ____. The WestLB Early Termination Advance should be
      transferred to [name of bank/wire instructions/ABA number] in favor of
      account number [ __ ], reference [ __ ].

            (3)   The amount of the WestLB Early Termination 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 WestLB Sub-Account of the Cash Collateral Account in
      accordance with Sections 3.6(d)(ii) and 3.6(f) of the Intercreditor
      Agreement, (ii) does not include any amount with respect to the payment of
      the principal of, or premium on, the Certificates, (iii) was computed in
      accordance with the provisions of the Certificates, the 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.

            (4)   Upon receipt by or on behalf of the Borrower of the amount
      requested hereby, (a) the Borrower will deposit such amount in the WestLB
      Sub-Account of the Cash Collateral Account and apply the same in
      accordance with the terms of Sections 3.6(d)(ii) and 3.6(f) 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 WestLB Early Termination 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 WestLB Early Termination Advance requested by this Notice of Borrowing, the


                                      II-1



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:

















                                      II-2



       SCHEDULE I TO WESTLB EARLY TERMINATION ADVANCE NOTICE OF BORROWING

    [Insert copy of computations in accordance with WestLB Early Termination
                          Advance Notice of Borrowing]




























                                      II-3



                                                                    Annex III to
                                                      Revolving Credit Agreement

                      DOWNGRADE ADVANCE NOTICE OF BORROWING

            The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to WESTLB AG, acting through its New
York Branch (the "LIQUIDITY PROVIDER"), with reference to the Revolving Credit
Agreement (2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2)   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 WestLB Sub-Account of the Cash Collateral Account in
      accordance with Section 3.6(c) of the Intercreditor Agreement by reason of
      the occurrence of a Downgrade Event, which Advance is requested to be made
      on __________, ____. The Downgrade Advance should be transferred to [name
      of bank/wire instructions/ABA number] in favor of account number [ __ ],
      reference [ __ ].

            (3)   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 WestLB
      Sub-Account of the Cash Collateral Account in accordance with Sections
      3.6(c) and 3.6(f) of the Intercreditor Agreement, (ii) does not include
      any amount with respect to the payment of the principal of, or premium on,
      the Certificates, (iii) was computed in accordance with the provisions of
      the Certificates, the 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.

            (4)   Upon receipt by or on behalf of the Borrower of the amount
      requested hereby, (a) the Borrower will deposit such amount in the WestLB
      Sub-Account of the Cash Collateral Account and apply the same in
      accordance with the terms of Sections 3.6(c) and 3.6(f) 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.


                                      III-1



            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:




















                                      III-2



               SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING

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




























                                      III-3



                                                                     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 WESTLB AG, acting through its New
York Branch (the "LIQUIDITY PROVIDER"), with reference to the Revolving Credit
Agreement (2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2)   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 WestLB Sub-Account of the 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 ____________, ____. The Final Advance should be
      transferred to [name of bank/wire instructions/ABA number] in favor of
      account number [ __ ], reference [ __ ].

            (3)   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
      WestLB Sub-Account of the Cash Collateral Account in accordance with
      Sections 3.6(f) and 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 Certificates, (iii) was computed in accordance with the provisions
      of the Certificates, the 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.

            (4)   Upon receipt by or on behalf of the Borrower of the amount
      requested hereby, (a) the Borrower will deposit such amount in the WestLB
      Sub-Account of the Cash Collateral Account and apply the same in
      accordance with the terms of Sections 3.6(f) and 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.

            (5)   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.](1)


- ---------------
(1)  Bracketed language may be included at Borrower's option.



                                      IV-1



            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:












                                      IV-2




                 SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING

          [Insert copy of computations in accordance with Final Advance
                              Notice of Borrowing]























                                      IV-3



                                                                      Annex V to
                                                      Revolving Credit Agreement

                              NOTICE OF TERMINATION

                                                    [Date]

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

Attention: Corporate Trust Administration

            Revolving Credit Agreement dated as of June 29, 2004, between
            Wilmington Trust Company, as Subordination Agent, as agent and
            trustee for the Continental Airlines Pass Through Trust 2004-ERJ1,
            as Borrower, and WestLB AG, acting through its New York Branch (the
            "LIQUIDITY AGREEMENT")

Ladies and Gentlemen:

            You are hereby notified that, pursuant to Section 6.01 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.















                                      V-1



            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,

                                    WESTLB AG, acting through its New York
                                       Branch, as Liquidity Provider

                                    By_________________________________
                                    Name:
                                    Title:


                                    By_________________________________
                                    Name:
                                    Title:



cc:  Wilmington Trust Company,
as Trustee








                                       V-2



                                                                     Annex VI to
                                                      Revolving Credit Agreement

                    NOTICE OF REPLACEMENT SUBORDINATION AGENT

[Date]
Attention:

      Revolving Credit Agreement dated as of June 29, 2004, between Wilmington
      Trust Company, as Subordination Agent, as agent and trustee for the
      Continental Airlines Pass Through Trust, 2004-ERJ1, as Borrower, and
      WestLB AG, acting through its New York Branch (the "LIQUIDITY AGREEMENT")

Ladies and Gentlemen:

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

                        ------------------------------
                              [Name of Transferee]

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

                             [Address 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.















                                      VI-1





            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:


















                                      VI-2



                                                                    Annex VII to
                                                      Revolving Credit Agreement

                  WESTLB EXPIRATION ADVANCE NOTICE OF BORROWING

            The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to WESTLB AG, acting through its New
York Branch (the "LIQUIDITY PROVIDER"), with reference to the Revolving Credit
Agreement (2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2)   The Borrower is delivering this Notice of Borrowing for the
      making of the WestLB Expiration Advance by the Liquidity Provider to be
      used for the funding of the WestLB Sub-Account of the Cash Collateral
      Account in accordance with Section 3.6(l) of the Intercreditor Agreement,
      which Advance is requested to be made on __________, ____. The WestLB
      Expiration Advance should be transferred to [name of bank/wire
      instructions/ABA number] in favor of account number [ __ ], reference [ __
      ].

            (3)   The amount of the WestLB Expiration 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
      WestLB Sub-Account of the Cash Collateral Account in accordance with
      Sections 3.6(f) and 3.6(l) of the Intercreditor Agreement, (ii) does not
      include any amount with respect to the payment of the principal of, or
      premium on, the Certificates, (iii) was computed in accordance with the
      provisions of the Certificates, the 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.

            (4)   Upon receipt by or on behalf of the Borrower of the amount
      requested hereby, (a) the Borrower will deposit such amount in the WestLB
      Sub-Account of the Cash Collateral Account and apply the same in
      accordance with the terms of Sections 3.6(f) and 3.6(l) 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 WestLB Expiration 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 WestLB
Expiration Advance requested by this Notice of Borrowing, the Borrower shall not
be entitled to request any further Advances under the Liquidity Agreement.




                                      VII-1




            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:
















                                      VII-2



           SCHEDULE I TO WESTLB EXPIRATION ADVANCE NOTICE OF BORROWING

[Insert copy of computations in accordance with WestLB Expiration Advance
Notice of Borrowing]



























                                      VII-3





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

                    REVOLVING CREDIT AGREEMENT (2004-ERJ1)

                            Dated as of June 29, 2004

                                     between

                            WILMINGTON TRUST COMPANY,
              as Subordination Agent, as agent and trustee for the
              Continental Airlines Pass Through Trust 2004-ERJ1,
                                  as Borrower,

                                       and

              CITICORP NORTH AMERICA, INC., as Liquidity Provider

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



                Continental Airlines Pass Through Trust 2004-ERJ1
             Continental Airlines 9.558% Pass Through Certificates,
                                Series 2004-ERJ1










                                TABLE OF CONTENTS

                                                                            Page


ARTICLE I  DEFINITIONS.........................................................1
      Section 1.01  Certain Defined Terms......................................1

ARTICLE II  AMOUNT AND TERMS OF THE COMMITMENT.................................8
      Section 2.01  The Advances...............................................8
      Section 2.02  Making the Advances........................................8
      Section 2.03  Fees......................................................10
      Section 2.04  Reductions or Termination of the Maximum Commitment.......10
      Section 2.05  Repayments of Interest Advances, the CNAI Special
                    Termination Advance or the Final Advance..................10
      Section 2.06  Repayments of Provider Advances...........................11
      Section 2.07  Payments to the Liquidity Provider Under the
                    Intercreditor Agreement...................................12
      Section 2.08  Book Entries..............................................12
      Section 2.09  Payments from Available Funds Only........................13
      Section 2.10  Extension of the Expiry Date; Non-Extension Advance.......13

ARTICLE III  OBLIGATIONS OF THE BORROWER......................................13
      Section 3.01  Increased Costs...........................................13
      Section 3.02  Capital Adequacy..........................................14
      Section 3.03  Payments Free of Deductions...............................15
      Section 3.04  Payments..................................................16
      Section 3.05  Computations..............................................17
      Section 3.06  Payment on Non-Business Days..............................17
      Section 3.07  Interest..................................................17
      Section 3.08  Replacement of Borrower...................................18
      Section 3.09  Funding Loss Indemnification..............................18
      Section 3.10  Illegality................................................19
      Section 3.11  Mitigation................................................19

ARTICLE IV  CONDITIONS PRECEDENT..............................................19
      Section 4.01  Conditions Precedent to Effectiveness of Section 2.01.....19
      Section 4.02  Conditions Precedent to Borrowing.........................21

ARTICLE V  COVENANTS..........................................................21
      Section 5.01  Affirmative Covenants of the Borrower.....................21
      Section 5.02  Negative Covenants of the Borrower........................22

ARTICLE VI  LIQUIDITY EVENTS OF DEFAULT AND SPECIAL TERMINATION...............22
      Section 6.01  Liquidity Events of Default and Special Termination.......22



ARTICLE VII  MISCELLANEOUS....................................................22
      Section 7.01  Amendments, Etc...........................................22
      Section 7.02  Notices, Etc..............................................23
      Section 7.03  No Waiver; Remedies.......................................24
      Section 7.04  Further Assurances........................................24
      Section 7.05  Indemnification; Survival of Certain Provisions...........24
      Section 7.06  Liability of the Liquidity Provider.......................24
      Section 7.07  Costs, Expenses and Taxes.................................25
      Section 7.08  Binding Effect; Participations............................26
      Section 7.09  Severability..............................................27
      Section 7.10  GOVERNING LAW.............................................27
      Section 7.11  Submission to Jurisdiction; Waiver of Jury Trial..........27
      Section 7.12  Execution in Counterparts.................................28
      Section 7.13  Entirety..................................................28
      Section 7.14  Headings..................................................28
      Section 7.15  LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES..........28


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

ANNEX VII...CNAI Special Termination Advance Notice of Borrowing

ANNEX VIII..Notice of CNAI Special Termination








                    REVOLVING CREDIT AGREEMENT (2004-ERJ1)



            This REVOLVING CREDIT AGREEMENT (2004-ERJ1), dated as of June 29,
2004, is made by and 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
Trust (as defined below) (the "BORROWER"), and CITICORP NORTH AMERICA, INC., a
Delaware corporation (the "LIQUIDITY PROVIDER").

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

            WHEREAS, pursuant to the Trust Agreement (such term and all other
capitalized terms used in these recitals having the meanings set forth or
referred to in Section 1.01), the Trust is issuing the Certificates;

            WHEREAS, the Borrower, in order to support the timely payment of a
portion of the interest on the 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; and

            WHEREAS, Citicorp, a Delaware corporation and an affiliate of the
Liquidity Provider (the "GUARANTOR") has entered into a guarantee, providing for
the full and unconditional guarantee of the Liquidity Provider's obligations
under this Agreement (the "GUARANTEE AGREEMENT").

            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.     CERTAIN DEFINED TERMS.

            (a) As used in this Agreement and unless 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 COSTS" has the meaning assigned to such term in Section
3.01.

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




            "AGREEMENT" means this Revolving Credit Agreement (2004-ERJ1), dated
as of June 29, 2004, between the Borrower and the Liquidity Provider, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.

            "APPLICABLE LIQUIDITY RATE" has the meaning assigned to such term in
Section 3.07(f).

            "APPLICABLE MARGIN" means (i) with respect to any Unpaid Advance
(other than an Unapplied CNAI Special Termination Advance) or Applied Provider
Advance, 2.75% per annum, (ii) with respect to any Unapplied Provider Advance,
the rate per annum specified in the Fee Letter applicable to this Agreement and
(iii) with respect to any Unapplied CNAI Special Termination Advance, the margin
per annum specified in the Fee Letter.

            "APPLIED DOWNGRADE ADVANCE" has the meaning assigned to such term in
Section 2.06(a).

            "APPLIED NON-EXTENSION ADVANCE" has the meaning assigned to such
term in Section 2.06(a).

            "APPLIED PROVIDER ADVANCE" has the meaning assigned to such term in
Section 2.06(a).

            "APPLIED CNAI SPECIAL TERMINATION ADVANCE" has the meaning assigned
to such term in Section 2.05.

            "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, 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 is outstanding, the
city and state in which the 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.

            "CNAI SPECIAL TERMINATION ADVANCE" means an Advance made pursuant to
Section 2.02(e).

            "CNAI SPECIAL TERMINATION NOTICE" means the Notice of CNAI Special
Termination substantially in the form of Annex VIII to this Agreement.

            "CONSENT PERIOD" has the meaning assigned to such term in Section
2.10.

            "DEPOSIT AGREEMENT" means the Deposit Agreement dated as of the date
hereof between Wells Fargo Bank Northwest, National Association, as Escrow
Agent, and WestLB AG, New York Branch, as Depositary, pertaining to the
Certificates, as the same may be amended, modified or supplemented from time to
time in accordance with the terms thereof.

            "DEPOSITARY" has the meaning assigned to such term in the Deposit
      Agreement.

            "DEPOSITS" has the meaning assigned to such term in the Deposit
Agreement.

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

            "DOWNGRADE EVENT" means (i) a downgrading of the Guarantor's
short-term unsecured debt rating or short-term issuer credit rating, as the case
may be, issued by either Rating Agency below the applicable Threshold Rating or
(ii) the Guarantee Agreement ceasing to be in full force and effect or becoming
invalid or unenforceable or the Guarantor denying its liability thereunder,
unless with respect to clause (i) above, each Rating Agency shall have confirmed
in writing on or prior to the date of such downgrading that such downgrading
will not result in the downgrading, withdrawal or suspension of the ratings of
the Certificates, in which case such downgrading of the Guarantor's short-term
unsecured debt rating or short-term issuer credit rating, as the case may be,
shall not constitute a Downgrade Event and shall be referred to herein as a
"PROVIDER DOWNGRADE".

            "EFFECTIVE DATE" has the meaning assigned to such term in Section
4.01. The delivery of the certificate of the Liquidity Provider contemplated by
Section 4.01(e) shall be conclusive evidence that the Effective Date has
occurred.

            "EXCLUDED TAXES" means (i) Taxes imposed on, based on or measured by
the income of, or franchise Taxes imposed on, the Liquidity Provider or its
Lending Office by the jurisdiction where such Liquidity Provider's principal
office or such Lending Office is located or any other taxing jurisdiction in
which such Tax is imposed as a result of the Liquidity Provider being, or having
been, organized in, or conducting, or having conducted, any activities unrelated
to the transactions contemplated by the Operative Agreements in, such
jurisdiction or (ii) withholding taxes, whether or not indemnified under Section
3.03.

            "EXCLUDED WITHHOLDING TAXES" means (i) withholding Taxes imposed by
the United States except to the extent that such United States withholding Taxes
are imposed or increased as a result of a change in applicable law after the



date hereof and, in the case of any successor Liquidity Provider, any
withholding Tax imposed by the United States except (a) if such Liquidity
Provider is, on the date it acquires its interest herein, a "resident" of an
Applicable Treaty jurisdiction entitled to claim the benefits of an Applicable
Treaty in respect of amounts payable hereunder, any such withholding Tax to the
extent imposed as a result of a change in applicable law (other than any
addition of, or change in, any "anti-treaty shopping", "limitation on benefits",
or similar provision in any treaty or other applicable law restricting the
availability of treaty benefits (including, without limitation any provision
similar to the Protocol Amending the Convention Between the United States of
America and the Kingdom of the Netherlands for the Avoidance of Double Taxation
and the Prevention of Fiscal Evasion with respect to Taxes on Income, signed at
Washington on October 13, 1993)) after the date such Liquidity Provider acquired
its interest herein and (b) any such withholding Tax to the extent the amount of
such withholding Tax imposed on such successor Liquidity Provider does not
exceed the amount of such withholding Tax that, in the absence of the transfer
to such Liquidity Provider, would have been an Indemnified Tax imposed on
payments to the predecessor Liquidity Provider pursuant to applicable law in
effect on the date such successor Liquidity Provider acquired its interest
herein, (ii) any Tax imposed or to the extent increased as a result of the
Liquidity Provider failing to deliver to the Borrower any certificate or
document (the delivery of which certificate or document in the good faith
judgment of the Liquidity Provider will not expose the Liquidity Provider to any
adverse consequence and which the Liquidity Provider 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, and (iii) any Tax imposed by a jurisdiction as a result of the
Liquidity Provider being, or having been, organized in, or maintaining, or
having maintained, its principal office or Lending Office in, or conducting, or
having conducted, any activities unrelated to the transactions contemplated by
the Operative Agreements in, such jurisdiction. For purposes of this definition,
"Applicable Treaty" means an income tax treaty between the United States and any
of Australia, Austria, Canada, France, Germany, Ireland, Japan, Luxembourg, The
Netherlands, Sweden, Switzerland or the United Kingdom.

            "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 other than sales, use and V.A.T. taxes imposed on fees and expenses
payable pursuant to Section 7.07.

            "EXPIRY DATE" means June 27, 2005 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 2.02(d).

            "GUARANTOR" has the meaning assigned to such term in the preliminary
statements of this Agreement.

            "GUARANTEE AGREEMENT" has the meaning assigned to such term in the
preliminary statements of this Agreement.

            "INDEMNIFIED TAX" has the meaning assigned to such term in Section
3.03.



            "INTERCREDITOR AGREEMENT" means the Intercreditor Agreement dated as
of the date hereof, among the Trustee, the Liquidity Provider, the other
liquidity provider party thereto 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
2.02(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
                 (A) the Liquidity Provider's receipt of the Notice of Borrowing
                 for such LIBOR Advance or (B) the withdrawal of funds from the
                 Cash Collateral Account for the purpose of paying interest on
                 the Certificates as contemplated by Section 2.06(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.

            "LENDING OFFICE" means the lending office of the Liquidity Provider
presently located at New York, New York, 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 another lending office outside the United States of America
except in accordance with Section 3.11 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,

            (i)    the rate per annum appearing on display page 3750 (British
                   Bankers Association-LIBOR) of the Telerate Service (or any
                   successor or substitute therefor) at approximately 11:00 a.m.
                   (London time) two Business Days before the first day of such
                   Interest Period, as the rate for dollar deposits with a
                   maturity comparable to such Interest Period, or

            (ii)   if the rate calculated pursuant to clause (i) above is not
                   available, the average (rounded upwards, if necessary, to
                   the next 1/16 of 1%) of the rates per annum at which
                   deposits in dollars are offered for the relevant Interest
                   Period by three banks of recognized standing selected by
                   the Liquidity Provider 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 LIBOR
                   Advance to which such Interest Period is to apply and for
                   a period comparable to such Interest Period.




            "LIQUIDITY EVENT OF DEFAULT" means the occurrence of either (a) the
Acceleration of all of the Equipment Notes (PROVIDED that, with respect to the
period prior to the Delivery Period Expiry Date, such Equipment Notes have an
aggregate outstanding principal balance in excess of $108,000,000) or (b) a
Continental Bankruptcy Event.

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

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

            "MAXIMUM AVAILABLE COMMITMENT" means, subject to the proviso
contained in the third sentence of Section 2.02(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, a CNAI Special Termination Advance or a Final
Advance, the Maximum Available Commitment shall be zero.

            "MAXIMUM COMMITMENT" means initially $9,158,032.86, as the same may
be reduced from time to time in accordance with Section 2.04(a).

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

            "NOTICE OF BORROWING" has the meaning assigned to such term in
Section 2.02(f).

            "NOTICE OF REPLACEMENT SUBORDINATION AGENT" has the meaning assigned
to such term in Section 3.08.

            "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 SUPPLEMENT" means the final Prospectus Supplement dated
June 18, 2004 relating to the Certificates, as such Prospectus Supplement may be
amended or supplemented.

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

            "PROVIDER DOWNGRADE" has the meaning assigned to such term in the
definition of "Downgrade Event".

            "REGULATORY CHANGE" has the meaning assigned to such term in Section
3.01.

            "REPLENISHMENT AMOUNT" has the meaning assigned to such term in
Section 2.06(b).




            "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 Certificates have been paid in full (or provision has
been made for such payment in accordance with the Intercreditor Agreement and
the Trust Agreement) 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 or CNAI Special Termination Notice from the Liquidity
Provider pursuant to Section 6.01 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.

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

            "UNAPPLIED PROVIDER ADVANCE" means any portion of any Provider
Advance that is not an Applied Provider Advance.

            "UNAPPLIED CNAI SPECIAL TERMINATION ADVANCE" means any portion of a
CNAI Special Termination Advance that is not an Applied CNAI Special Termination
Advance.

            "UNPAID ADVANCE" has the meaning assigned to such term in Section
      2.05.

            (b) For the purposes of this Agreement, the following terms shall
have the respective meanings assigned to such terms in the Intercreditor
Agreement:

            "ACCELERATION", "CASH COLLATERAL ACCOUNT", "CERTIFICATE",
"CERTIFICATEHOLDER", "CLOSING DATE", "CNAI FEE LETTER", "CNAI SUB-ACCOUNT",
"CONTINENTAL", "CONTINENTAL BANKRUPTCY EVENT", "CONTROLLING PARTY", "CORPORATE
TRUST OFFICE", "DELIVERY PERIOD EXPIRY DATE", "DISTRIBUTION DATE", "DOWNGRADED
FACILITY", "EQUIPMENT NOTES", "FEE LETTER", "FINAL LEGAL DISTRIBUTION DATE",
"FINANCING AGREEMENT", "INDENTURE", "INVESTMENT Earnings", "LIQUIDITY
OBLIGATIONS", "LOAN TRUSTEE", "MOODY'S", "NON-EXTENDED FACILITY", "NOTE PURCHASE
AGREEMENT", "OPERATIVE AGREEMENTS", "PARTICIPATION AGREEMENT", "PERFORMING
EQUIPMENT NOTE", "PERSON", "POOL BALANCE", "RATING AGENCIES", "RATINGS
CONFIRMATION", "REGULAR DISTRIBUTION DATES", "REPLACEMENT LIQUIDITY FACILITY",
"REQUIRED AMOUNT", "RESPONSIBLE OFFICER", "SCHEDULED PAYMENT", "SPECIAL
PAYMENT", "STANDARD & POOR'S", "STATED INTEREST RATE", "SUB-ACCOUNT",
"SUBORDINATION AGENT", "TAXES", "THRESHOLD RATING", "TRUST", "TRUST AGREEMENT",
"TRUSTEE", "UNDERWRITERS", "UNDERWRITING AGREEMENT" and "WRITTEN NOTICE".





                                   ARTICLE II

                       AMOUNT AND TERMS OF THE COMMITMENT

            Section 2.01. 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 1:00 p.m. (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 2.04(b)) in an aggregate amount at any time
outstanding not to exceed the Maximum Commitment.

            Section 2.02. MAKING THE ADVANCES. (a) 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 interest with respect to the
Certificates at the Stated Interest Rate therefor in accordance with Sections
3.6(a) and 3.6(b) 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 or in part of the
amount of any Interest Advance made pursuant to this Section 2.02(a), together
with accrued interest thereon (as provided herein), the Maximum Available
Commitment shall be reinstated by an amount equal to the amount of such Interest
Advance so repaid but not to exceed the Maximum Commitment; PROVIDED, HOWEVER,
that the Maximum Available Commitment shall not be so reinstated at any time if
(x) both a Performing Note Deficiency exists and a Liquidity Event of Default
shall have occurred and be continuing, or (y) a Final Advance, a Provider
Advance or a CNAI Special Termination Advance has been made.

            (b) A Non-Extension Advance shall be made in a single Borrowing if
this Agreement is not extended in accordance with Section 3.6(d)(i) of the
Intercreditor Agreement (unless a Replacement Liquidity Facility to replace this
Agreement shall have been delivered to the Borrower as contemplated by said
Section 3.6(d)(i) within the time period specified in such Section 3.6(d)(i)) 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 CNAI Sub-Account of the



Cash Collateral Account in accordance with Sections 3.6(d)(i) and 3.6(f) of the
Intercreditor Agreement.

            (c) A Downgrade Advance shall be made in a single Borrowing upon the
occurrence of a Downgrade Event (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 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
CNAI Sub-Account of the Cash Collateral Account in accordance with Sections
3.6(c) and 3.6(f) of the Intercreditor Agreement.

            (d) 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 6.01(a) 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 CNAI Sub-Account of the Cash Collateral Account in accordance with
Sections 3.6(f) and 3.6(i) of the Intercreditor Agreement.

            (e) A CNAI Special Termination Advance shall be made in a single
Borrowing upon the receipt by the Borrower of a CNAI Special Termination Notice
from the Liquidity Provider pursuant to Section 6.01(b), by delivery to the
Liquidity Provider of a written and completed Notice of Borrowing in
substantially the form of Annex VII, 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 CNAI Sub-Account of the Cash Collateral Account in
accordance with Sections 3.6(f) and 3.6(k) of the Intercreditor Agreement.

            (f) Each Borrowing shall be made on notice in writing (a "NOTICE OF
BORROWING") in substantially the form required by Section 2.02(a), 2.02(b),
2.02(c), 2.02(d) or 2.02(e), as the case may be, given by the Borrower to the
Liquidity Provider. Each Notice of Borrowing shall be effective upon delivery of
a copy thereof to the Liquidity Provider's office at the address specified in
Section 7.02. If a Notice of Borrowing is delivered by the Borrower in respect
of any Borrowing no later than 1:00 p.m. (New York City time) on a Business Day,
upon satisfaction of the conditions precedent set forth in Section 4.02 with
respect to a requested Borrowing, the Liquidity Provider shall make available to
the Borrower, in accordance with its payment instructions, the amount of such
Borrowing in U.S. dollars and immediately available funds, before 4:00 p.m. (New
York City time) on such Business Day or on such later Business Day specified in
such Notice of Borrowing. If a Notice of Borrowing is delivered by the Borrower
in respect of any Borrowing on a day that is not a Business Day or after 1:00
p.m. (New York City time) on a Business Day, upon satisfaction of the conditions
precedent set forth in Section 4.02 with respect to a requested Borrowing, the
Liquidity Provider shall make available to the Borrower, in accordance with its
payment instructions, the amount of such Borrowing in U.S. dollars and in
immediately available funds, 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 by the Borrower in such Notice of 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.

            (g) 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. If the Liquidity Provider



makes an Advance requested pursuant to a Notice of Borrowing before 12:00 noon
(New York City time) on the second Business Day after the date of payment
specified in Section 2.02(f), the Liquidity Provider shall have fully discharged
its obligations hereunder with respect to such Advance and an event of default
shall not have occurred hereunder. Following the making of any Advance pursuant
to Section 2.02(b), 2.02(c), 2.02(d) or 2.02(e) hereof to fund the CNAI
Sub-Account of the Cash Collateral Account, the Liquidity Provider shall have no
interest in or rights to the Cash Collateral Account, any Sub-Account thereof,
the funds constituting such Advance or any other amounts from time to time on
deposit in the Cash Collateral Account or any Sub-Account thereof; 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 3.6(f) of the
Intercreditor Agreement and PROVIDED FURTHER, that the foregoing shall not
affect or impair the rights of the Liquidity Provider to provide written
instructions with respect to the investment and reinvestment of amounts in the
CNAI Sub-Account of the Cash Collateral Account to the extent provided in
Section 2.2(b) 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 2.03. FEES. The Borrower agrees to pay to the Liquidity
Provider the fees set forth in the Fee Letter applicable to this Agreement.

            Section 2.04. REDUCTIONS OR TERMINATION OF THE MAXIMUM COMMITMENT.

            (a) AUTOMATIC REDUCTION. Promptly following each date on which the
Required Amount with respect to this Agreement is reduced as a result of a
reduction (or deemed reduction) in the Pool Balance of the Certificates or
otherwise, the Maximum Commitment shall automatically be reduced to an amount
equal to such reduced Required Amount (as calculated by the Borrower); PROVIDED
that on the first Regular Distribution Date, the Maximum Commitment shall
automatically be reduced to the Required Amount then in effect with respect to
this Agreement. 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.

            (b) TERMINATION. Upon the making of any Provider Advance, a CNAI
Special Termination 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 2.05. REPAYMENTS OF INTEREST ADVANCES, THE CNAI SPECIAL
TERMINATION ADVANCE OR THE FINAL ADVANCE. Subject to Sections 2.06, 2.07 and
2.09 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, the CNAI Special Termination 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 3.07 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 2.05 or (ii) this Liquidity Facility shall become a
Downgraded Facility or a 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 2.06 and for the purposes of Section 2.06(b)); PROVIDED,
FURTHER, that amounts in respect of a CNAI Special Termination Advance withdrawn
from the CNAI Sub-Account of the Cash Collateral Account for the purpose of
paying interest on the Certificates in accordance with 3.6(f) of the
Intercreditor Agreement (the amount of an such withdrawal being an "APPLIED CNAI
SPECIAL TERMINATION ADVANCE") shall thereafter be treated as an Interest Advance
under this Agreement for the purposes of determining the Applicable Liquidity
Rate for interest payable thereon; and PROVIDED, FURTHER, that if, following the
making of a CNAI Special Termination Advance, the Liquidity Provider delivers a
Termination Notice to the Borrower pursuant to Section 6.01(a) hereof, such CNAI
Special Termination Advance shall thereafter be treated as a Final Advance under
this Agreement for purposes of determining the Applicable Liquidity Rate for
interest payable thereon and the obligation of repayment thereof. The Borrower
and the Liquidity Provider agree that the repayment in full of each Interest
Advance, the CNAI Special Termination 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 2.06. REPAYMENTS OF PROVIDER ADVANCES. (a) Amounts advanced
hereunder in respect of a Provider Advance shall be deposited in the CNAI
Sub-Account of the Cash Collateral Account and invested and withdrawn from the
CNAI Sub-Account of the Cash Collateral Account as set forth in Sections 3.6(c),
3.6(d), 3.6(e) and 3.6(f) of the Intercreditor Agreement. Subject to Sections
2.07 and 2.09, 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 3.07 hereof; PROVIDED, HOWEVER,
that amounts in respect of a Provider Advance withdrawn from the CNAI
Sub-Account of the Cash Collateral Account for the purpose of paying interest on
the 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 2.06(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 6.01(a) 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 and the
obligation for repayment thereof. Subject to Sections 2.07 and 2.09 hereof,



immediately upon the withdrawal of any amounts from the CNAI Sub-Account of the
Cash Collateral Account pursuant to Section 3.6(f) of the Intercreditor
Agreement on account of a reduction (or deemed reduction) in the Required Amount
with respect to such Sub-Account, the Borrower shall repay to the Liquidity
Provider a portion of the Provider Advances in a principal amount equal to such
reduction, plus interest on the principal amount prepaid as provided in Section
3.07 hereof.

            (b) At any time when an Applied Provider Advance (or any portion
thereof) is outstanding, upon the deposit in the CNAI Sub-Account of the 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 with respect to such
Sub-Account 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.

            (c) 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 CNAI Sub-Account of
the Cash Collateral Account after giving effect to any Applied Provider Advance
on the date of such replacement shall be reimbursed to the replaced Liquidity
Provider, but only to the extent such amounts are necessary to repay in full to
the replaced Liquidity Provider all amounts owing to it hereunder.

            Section 2.07. 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
and shall discharge in full the corresponding obligations of the Borrower
hereunder (or, if not provided for in the Intercreditor Agreement, then in such
manner as the Liquidity Provider shall deem appropriate).

            Section 2.08. 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 2.09. 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 the CNAI
Fee Letter, Section 9.1 of the Participation Agreements and Section 6 of the
Note Purchase Agreement 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 and other applicable 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 CNAI Sub-Account of the 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. Amounts on deposit in the other Sub-Account in respect of the
Certificates shall not be available to make payments under this 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 Legal Distribution Date for the Certificates), the
Borrower shall request that the Liquidity Provider extend the Expiry Date to the
earlier of (i) the date that is 15 days after the Final Legal Distribution Date
for the Certificates and (ii) the date that is the day immediately preceding the
364th day occurring after the last day of the Consent Period (as hereinafter
defined). Whether or not the Borrower has made such request, the Liquidity
Provider shall advise the Borrower, no earlier than the 40th day (or, if
earlier, the date of the Liquidity Provider's receipt of such request, if any,
from the Borrower) and no later than the 25th day prior to the then effective
Expiry Date (such period, the "CONSENT PERIOD"), whether, in its sole
discretion, it agrees to so extend the Expiry Date. If the Liquidity Provider
advises the Borrower on or before the date on which the Consent Period ends that
such Expiry Date shall not be so extended, or fails to irrevocably and
unconditionally advise the Borrower on or before the date on which the Consent
Period ends 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 the date on which the Consent Period ends (but prior to the then effective
Expiry Date) to request a Non-Extension Advance in accordance with Section
2.02(b) hereof and Section 3.6(d)(i) of the Intercreditor Agreement.


                                   ARTICLE III

                           OBLIGATIONS OF THE BORROWER

            Section 3.01. INCREASED COSTS. 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 of the Board of Governors of the Federal Reserve
System), 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 or such obligation (other than with respect to
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 such obligation or any deposits
referred to in the definition of LIBOR Rate or related definitions).

            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 3.01 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 3.01 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.

            Notwithstanding the preceding two paragraphs, the Liquidity Provider
and the Subordination Agent agree that any permitted assignee or participant of
the initial Liquidity Provider which is not a bank shall not be entitled to the
benefits of the preceding two paragraphs (but without limiting the provisions of
Section 7.08 hereof).

            Section 3.02. CAPITAL ADEQUACY. 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, subject to the provisions of Section
3.11, 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. From and after the Extension Effective
Date and prior to the occurrence of a Provider Downgrade, the Liquidity Provider
will be entitled to compensation pursuant to this Section 3.02 only to the



extent that the Liquidity Provider would have been so entitled if the Extension
Effective Date had not occurred. From and after the Extension Effective Date and
after the occurrence of a Provider Downgrade, the Liquidity Provider will be
entitled to compensation pursuant to this Section 3.02 only to the extent that
the Liquidity Provider would have been so entitled had the Liquidity Provider
made a Downgrade Advance upon the occurrence of such Provider Downgrade.

            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 3.02 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 3.02 of the effect of any increase in the amount of
capital required to be maintained by the Liquidity Provider 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.

            Notwithstanding the preceding two paragraphs, the Liquidity Provider
and the Subordination Agent agree that any permitted assignee or participant of
the initial Liquidity Provider which is not a bank shall not be entitled to the
benefits of the preceding two paragraphs (but without limiting the provisions of
Section 7.08 hereof).

            Section 3.03. PAYMENTS FREE OF DEDUCTIONS. (a) All payments made by
the Borrower under this Agreement shall be made without reduction or withholding
for or on account of any present or future Taxes of any nature whatsoever now or
hereafter imposed, levied, collected, withheld or assessed, other than Excluded
Withholding Taxes (such non-excluded Taxes being referred to herein,
collectively, as "INDEMNIFIED TAXES" and, individually, as an "INDEMNIFIED TAX")
unless any such reduction or withholding is required by applicable law. If any
Taxes are required to be withheld from any amounts payable to the Liquidity
Provider under this Agreement, (i) the Borrower shall within the time prescribed
therefor by applicable law pay to the appropriate governmental or taxing
authority the full amount of any such Taxes (including any additional Tax
required to be deducted or withheld in respect of the additional amounts payable
under clause (ii) hereof) and make such reports or returns in connection
therewith at the time or times and in the manner prescribed by applicable law,
and (ii) in the case of Indemnified Taxes, the amounts payable to the Liquidity
Provider shall be increased to the extent necessary to yield to the Liquidity
Provider (after deduction or withholding for or on account of all Indemnified
Taxes and any additional Taxes required to be deducted or withheld or payable by
the Liquidity Provider by reason of the receipt or accrual of the additional
amounts payable pursuant to this clause (ii)) interest or any other such amounts
payable under this Agreement at the rates or in the amounts specified in this
Agreement. If the Liquidity Provider (including a successor Liquidity Provider)
is not organized under the laws of the United States or any State thereof, to
the extent it is eligible to do so, the Liquidity Provider agrees to provide to
the Borrower, prior to the first date any amount is payable to it hereunder, two
executed original copies of Internal Revenue Service Form W-8BEN or W-8ECI, 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. In addition, the Liquidity Provider will provide, from time to time
upon the reasonable request of the Borrower, such additional forms or



documentation as may be necessary to establish an available exemption from (or
an entitlement to a reduced rate of) withholding Tax on payments hereunder.
Within 30 days after the date of each payment hereunder, the Borrower shall
furnish to the Liquidity Provider an original or certified copy of a receipt (or
other documentary evidence reasonably acceptable to the Liquidity Provider)
evidencing the payment of the Taxes applicable to such payment.

            (b) If the Liquidity Provider (including a successor Liquidity
Provider) is not organized under the laws of the United States or any State
thereof, all Advances made by the Liquidity Provider under this Agreement shall
be made free and clear of, and without reduction for or on account of, any Taxes
that are imposed by a jurisdiction in which the Liquidity Provider is organized,
has its Lending Office or maintains its principal place of business unless such
reduction or withholding is required by applicable law. If any such Taxes are
required to be withheld or deducted from any Advances, the Liquidity Provider
shall (i) within the time prescribed therefor by applicable law pay to the
appropriate governmental or taxing authority the full amount of any such Taxes
(and any additional Taxes in respect of the additional amounts payable under
clause (ii) hereof) and make such reports or returns in connection therewith at
the time or times and in the manner prescribed by applicable law, and (ii) pay
to the Borrower an additional amount which (after deduction of all such Taxes)
shall be sufficient to yield to the Borrower the full amount that would have
been received by it had no such withholding or deduction been required. The
Borrower shall, for United States federal income tax purposes and for all
purposes hereunder, treat such payments as Interest Advances, and, as such, will
treat such payments as loans made by the Liquidity Provider to the Borrower,
unless otherwise required by law (it being understood and agreed that the
treatment of such additional amounts shall not reduce the Maximum Available
Commitment hereunder). Within 30 days after the date of each payment hereunder,
the Liquidity Provider shall furnish to the Borrower an original or certified
copy of a receipt (or other documentary evidence reasonably acceptable to the
Borrower) evidencing the payment of the Taxes applicable to such payment.

            (c) If any exemption from, or reduction in the rate of, any Taxes
required to be deducted or withheld from amounts payable by the Liquidity
Provider hereunder is reasonably available to the Borrower to establish that
payments under this Agreement are exempt from (or entitled to a reduced rate of)
Tax, the Borrower shall deliver to the Liquidity Provider such form or forms and
such other evidence of the eligibility of the Borrower for such exemption or
reduction as the Liquidity Provider may reasonably identify to the Borrower as
being required as a condition to exemption from, or reduction in the rate of,
any such Taxes.

            Section 3.04. 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
U.S. dollars, to the Liquidity Provider in immediately available funds, by wire
transfer to the account of Citicorp North America, Inc. at Citibank, N.A., 399
Park Avenue, New York, NY 10043, ABA #021000089, Account # 4063-2387, Reference:
Continental Airlines Pass Through Trust, Series 2004-ERJ1, Attention: Craig
Thorpe; or to such other U.S. bank account as the Liquidity Provider may from
time to time direct the Subordination Agent.




            Section 3.05. 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 3.06. 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 (if such Advance is a
LIBOR 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 3.07. INTEREST. (a) Subject to Section 2.09, 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 CNAI Sub-Account of the
Cash Collateral Account to pay interest on the 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 CNAI Sub-Account of the 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) that 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 the
case may be, 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 3.07 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 3.07 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 3.07 had at all times been in effect.

            (b) Each Advance (including, without limitation, each outstanding
Unapplied Provider Advance and Unapplied CNAI Special Termination Advance) will
be either a Base Rate Advance or a LIBOR Advance as provided in this Section
3.07. Each such 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 a 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 (or, if such Final Advance is deemed
to have been made, without delivery of a Notice of Borrowing pursuant to Section
2.06, by requesting, prior to 11:00 a.m. (New York City time) on the first
Business Day immediately following the Borrower's receipt of the applicable
Termination Notice, that such Final Advance not be converted from a Base Rate
Advance to a LIBOR Advance).

            (c) 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).

            (d) 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).

            (e) 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.

            (f) Each change in the Base Rate shall become effective immediately.
The rates of interest specified in this Section 3.07 with respect to any Advance
or other amount shall be referred to as the "APPLICABLE LIQUIDITY RATE".

            Section 3.08. 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 the Borrower for all purposes hereunder.

            Section 3.09. 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:

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

            (2) Any failure by the Borrower to borrow a LIBOR Advance on the
date for borrowing specified in the relevant notice under Section 2.02.




            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.

            Section 3.11. MITIGATION. If a condition arises or an event occurs
which would, or would upon the giving of notice, result in the payment of any
additional costs or amounts pursuant to Section 3.01, 3.02 or 3.03 or require
the conversion of any Advance pursuant to Section 3.10, the Liquidity Provider,
promptly upon becoming aware of the same, shall notify the Borrower and shall
use reasonable efforts (consistent with applicable legal and regulatory
restrictions) to mitigate the effects of such condition or event, including the
designation of a different Lending Office or furnishing of the proper
certificates under any applicable tax laws, tax treaties and conventions to the
extent that such certificates are legally available to the Liquidity Provider;
PROVIDED, that the Liquidity Provider shall be under no obligation to take any
step that, in its good-faith opinion would (i) result in its incurring any
additional costs in performing its obligations hereunder unless the Borrower has
agreed to reimburse it therefor or (ii) be otherwise disadvantageous to the
Liquidity Provider in the reasonable judgment of the Liquidity Provider.


                                   ARTICLE IV

                              CONDITIONS PRECEDENT

            Section 4.01. CONDITIONS PRECEDENT TO EFFECTIVENESS OF SECTION 2.01.
Section 2.01 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:

            (a)    The Liquidity Provider shall have received 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 and
                   the Fee Letter applicable to this Agreement duly executed on
                   behalf of each of the parties thereto (other than the
                   Liquidity Provider);

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




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

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

            (v)    An executed copy of each document, instrument, certificate
                   and opinion delivered on or before the Closing Date
                   pursuant to the Trust Agreement, the Intercreditor
                   Agreement and the other Operative Agreements (in the case
                   of each such opinion, other than the opinion of counsel
                   for the Underwriters, either addressed to the Liquidity
                   Provider or accompanied by 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 Trustee,
                   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
                   pertaining to the transactions contemplated hereby or by the
                   other Operative Agreements as the Liquidity Provider shall
                   have reasonably requested.

            (b)    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.




            (c)    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.

            (d)    All conditions precedent to the issuance of the Certificates
under the Trust Agreement shall have been satisfied or waived, all conditions
precedent to the effectiveness of the other Liquidity Facility shall have been
satisfied or waived, and all conditions precedent to the purchase of the
Certificates by the Underwriters under the Underwriting Agreement shall have
been satisfied or waived.

            (e)    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 2.01 have been satisfied or waived.

            Section 4.02. 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, on or 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 Advance requested.


                                    ARTICLE V

                                    COVENANTS

            Section 5.01. 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:

            (a) 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.

            (b) 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.

            (c) 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 5.02. 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 prior written consent
of the Liquidity Provider, which consent shall not be unreasonably withheld or
delayed.


                                   ARTICLE VI

             LIQUIDITY EVENTS OF DEFAULT AND SPECIAL TERMINATION

            Section 6.01. LIQUIDITY EVENTS OF DEFAULT AND SPECIAL TERMINATION.
(a) If (i) any Liquidity Event of Default has occurred and is continuing and
(ii) 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 (w) the obligation of the Liquidity Provider to make Advances
hereunder to expire on the fifth Business Day after the date on which such
Termination Notice is received by the Borrower, (x) the Borrower to promptly
request, and the Liquidity Provider to promptly make, a Final Advance in
accordance with Section 2.02(d) hereof and Section 3.6(i) of the Intercreditor
Agreement, (y) all other outstanding Advances to be automatically converted into
Final Advances for purposes of determining the Applicable Liquidity Rate for
interest payable thereon, and (z) subject to Sections 2.07 and 2.09 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.

            (b) If the aggregate Pool Balance of the Certificates is greater
than the aggregate outstanding principal amount of the Equipment Notes (other
than any Equipment Notes previously sold or with respect to which the collateral
securing such Equipment Notes has been disposed of) at any time during the
18-month period prior to September 1, 2019, the Liquidity Provider may, in its
discretion, deliver to the Borrower a CNAI Special Termination Notice, the
effect of which shall be to cause (i) the obligation of the Liquidity Provider
to make Advances hereunder to expire on the fifth Business Day after the date on
which such CNAI Special Termination Notice is received by the Borrower, (ii) the
Borrower to promptly request, and the Liquidity Provider to promptly make, a
CNAI Special Termination Advance in accordance with Section 2.02(e) hereof and
Section 3.6(k) of the Intercreditor Agreement and (iii) subject to Sections 2.07
and 2.09 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 7.01. 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 the Guarantor, 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 7.02. 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 Street
                                Wilmington, DE 19890-0001
                                Attention:  Corporate Trust Administration
                                Telephone: (800) 733-8485
                                Telecopy: (302) 651-8882

            Liquidity Provider: Citicorp North America, Inc.
                                2 Penns Way, Suite 200
                                New Castle, DE 19720
                                Reference:  Continental Airlines Pass
                                Through Trust 2004-ERJ1
                                Attention: Craig Thorpe
                                Telephone: (302) 894-6058
                                Telecopy: (212) 994-0847

                                with a copy to:

                                CITIBANK, N.A. Global Aviation
                                388 Greenwich Street, 23rd Floor
                                New York, NY 10013
                                Attention: Gaylord Holmes
                                Telephone: (212) 816-5138
                                Telecopy: (212) 816-5705

                                and

                                Citicorp
                                Treasury Department
                                153 East 53rd Street, 6th Floor
                                New York, NY 10043
                                Reference: Continental Airlines Pass
                                Through Trust 2004-ERJ1
                                Attention: Gregory C. Ehlke, Vice President
                                Telephone: (212) 559-0302
                                Telecopy: (212) 793-4776

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 Article II and Article 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 7.03. 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 7.04. 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 7.05. 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 Section 3.01, 3.02 or 7.07 hereof or in the Fee Letter applicable
to this Agreement (regardless of whether indemnified against pursuant to said
Sections or in such Fee Letter)), that may be imposed on, 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 applicable to this Agreement, 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; (iii) attributable to the failure by the
Liquidity Provider to perform or observe any agreement, covenant or condition on
its part to be performed or observed in this Agreement or the Intercreditor
Agreement, or (iv) a Tax. The indemnities contained in Section 9.1 of the
Participation Agreements, and the provisions of Sections 3.01, 3.02, 3.03, 3.09,
7.05 and 7.07 hereof, shall survive the termination of this Agreement.

            Section 7.06. LIABILITY OF THE LIQUIDITY PROVIDER. (a) 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 gross
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 or the Intercreditor 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. In no event, however, shall the Liquidity
Provider be liable on any theory of liability for any special, indirect,
consequential or punitive damages (including, without limitation, any loss of
profits, business or anticipated savings).

            (b) Neither the Liquidity Provider nor any of its officers,
employees, directors 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 gross 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 7.07. 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
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 any waiver or
consent thereunder (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
Account. 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 hold 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 7.08. BINDING EFFECT; PARTICIPATIONS. (a) 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 7.08) nor
(except as contemplated by Section 3.08) 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
7.08(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 (other than Continental and its
Affiliates) as the Liquidity Provider may in its sole discretion select, subject
to the requirements of Section 7.08(b). No such granting of participations 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. 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 3.03 and the like as they pertain to the Liquidity Provider shall be
deemed also to include those of each of its participants that are banks
(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).

            (b) 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 W-8ECI or Form W-8BEN, 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 W-8ECI or Form W-8BEN, 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 W-8BEN or Form
W-8ECI 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.




            (c) Notwithstanding the other provisions of this Section 7.08, 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 7.09. 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 non-authorization 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.  (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 of mail), postage
      prepaid, to each party hereto at its address set forth in Section 7.02
      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.

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

            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.






            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 Trust, as Borrower


                                    By________________________________________
                                    Name:
                                    Title:


                                    CITICORP NORTH AMERICA, INC.,
                                    as Liquidity Provider


                                    By________________________________________
                                    Name:
                                    Title:










                                                                      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 CITICORP NORTH AMERICA, INC. (the
"LIQUIDITY PROVIDER"), with reference to the Revolving Credit Agreement
(2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2) The Borrower is delivering this Notice of Borrowing for the
      making of an Interest Advance by the Liquidity Provider to be used,
      subject to clause (3)(v) below, for the payment of interest on the
      Certificates which was payable on ____________, ____ (the "DISTRIBUTION
      DATE") in accordance with the terms and provisions of the Trust Agreement
      and the Certificates, which Advance is requested to be made on
      ____________, ____. The Interest Advance should be transferred to [name of
      bank/wire instructions/ABA number] in favor of account number [ __ ],
      reference [ __ ].

            (3) The amount of the Interest Advance requested hereby (i) is
      $_______________.__, to be applied in accordance with Sections 3.6(a) and
      3.6(b) of the Intercreditor Agreement in respect of the payment of the
      interest which was due and payable on the Certificates on the Distribution
      Date, (ii) does not include any amount with respect to the payment of
      principal of, or premium on, the Certificates, (iii) was computed in
      accordance with the provisions of the Certificates, the 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, (v) does not include any amount of interest
      which was due and payable on the Certificates on such Distribution Date
      but which remains unpaid due to the failure of the Depositary to pay any
      amount of accrued interest on the Deposits on such Distribution Date and
      (vi) has not been and is not the subject of a prior or contemporaneous
      Notice of Borrowing.

            (4) 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 Notice of Borrowing



and such 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 _________, ____.


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

                                 By:__________________________________________
                                 Name:
                                 Title:





              SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING

                   [Insert copy of computations in accordance
                   with Interest Advance Notice of Borrowing]










                                                                     Annex II to
                                                      Revolving Credit Agreement

                    NON-EXTENSION ADVANCE NOTICE OF BORROWING

            The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to CITICORP NORTH AMERICA, INC. (the
"LIQUIDITY PROVIDER"), with reference to the Revolving Credit Agreement
(2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2) 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 CNAI Sub-Account of the Cash Collateral Account in
      accordance with Section 3.6(d)(i) of the Intercreditor Agreement, which
      Advance is requested to be made on __________, ____. The Non-Extension
      Advance should be transferred to [name of bank/wire instructions/ABA
      number] in favor of account number [ __ ], reference [ __ ].

            (3) 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 CNAI
      Sub-Account of the Cash Collateral Account in accordance with Sections
      3.6(d)(i) and 3.6(f) of the Intercreditor Agreement, (ii) does not include
      any amount with respect to the payment of the principal of, or premium on,
      the Certificates, (iii) was computed in accordance with the provisions of
      the Certificates, the 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.

            (4) Upon receipt by or on behalf of the Borrower of the amount
      requested hereby, (a) the Borrower will deposit such amount in the CNAI
      Sub-Account of the Cash Collateral Account and apply the same in
      accordance with the terms of Sections 3.6(d)(i) and 3.6(f) 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.




            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:





             SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING

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










                                                                    Annex III to
                                                      Revolving Credit Agreement

                      DOWNGRADE ADVANCE NOTICE OF BORROWING

            The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to CITICORP NORTH AMERICA, INC. (the
"LIQUIDITY PROVIDER"), with reference to the Revolving Credit Agreement
(2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2) 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 CNAI Sub-Account of the Cash Collateral Account in
      accordance with Section 3.6(c) of the Intercreditor Agreement by reason of
      the occurrence of a Downgrade Event, which Advance is requested to be made
      on __________, ____. The Downgrade Advance should be transferred to [name
      of bank/wire instructions/ABA number] in favor of account number [ __ ],
      reference [ __ ].

            (3) 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 CNAI
      Sub-Account of the Cash Collateral Account in accordance with Sections
      3.6(c) and 3.6(f) of the Intercreditor Agreement, (ii) does not include
      any amount with respect to the payment of the principal of, or premium on,
      the Certificates, (iii) was computed in accordance with the provisions of
      the Certificates, the 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.

            (4) Upon receipt by or on behalf of the Borrower of the amount
      requested hereby, (a) the Borrower will deposit such amount in the CNAI
      Sub-Account of the Cash Collateral Account and apply the same in
      accordance with the terms of Sections 3.6(c) and 3.6(f) 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.




            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:





               SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING

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










                                                                     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 CITICORP NORTH AMERICA, INC. (the
"LIQUIDITY PROVIDER"), with reference to the Revolving Credit Agreement
(2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2) 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 CNAI Sub-Account of the 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 ____________, ____. The Final Advance should be
      transferred to [name of bank/wire instructions/ABA number] in favor of
      account number [ __ ], reference [ __ ].

            (3) 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 CNAI
      Sub-Account of the Cash Collateral Account in accordance with Sections
      3.6(f) and 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
      Certificates, (iii) was computed in accordance with the provisions of the
      Certificates, the 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.

            (4) Upon receipt by or on behalf of the Borrower of the amount
      requested hereby, (a) the Borrower will deposit such amount in the CNAI
      Sub-Account of the Cash Collateral Account and apply the same in
      accordance with the terms of Sections 3.6(f) and 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.

            (5) 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.]1

- --------

1  Bracketed language may be included at Borrower's option.






            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:





                 SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING

                   [Insert copy of computations in accordance
                    with Final Advance Notice of Borrowing]










                                                                      Annex V to
                                                      Revolving Credit Agreement


                              NOTICE OF TERMINATION



                                                    [Date]

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

Attention: Corporate Trust Administration

            Revolving Credit Agreement dated as of June 29, 2004, between
            Wilmington Trust Company, as Subordination Agent, as agent and
            trustee for the Continental Airlines Pass Through Trust
            2004-ERJ1, as Borrower, and Citicorp North America, Inc. (the
            "LIQUIDITY AGREEMENT")

Ladies and Gentlemen:

            You are hereby notified that, pursuant to Section 6.01(a) 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.






            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,

                                    CITICORP NORTH AMERICA, INC.,
                                    as Liquidity Provider

                                    By____________________________________
                                    Name:
                                    Title:



cc:   Wilmington Trust Company,
      as Trustee





                                                                     Annex VI to
                                                      Revolving Credit Agreement


                    NOTICE OF REPLACEMENT SUBORDINATION AGENT


[Date]
Attention:

      Revolving Credit Agreement dated as of June 29, 2004, between Wilmington
      Trust Company, as Subordination Agent, as agent and trustee for the
      Continental Airlines Pass Through Trust, 2004-ERJ1, as Borrower, and
      Citicorp North America, Inc. (the "LIQUIDITY AGREEMENT")

Ladies and Gentlemen:

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

                         ------------------------------
                              [Name of Transferee]

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

                             [Address 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:









                                                                    Annex VII to
                                                      Revolving Credit Agreement


              CNAI SPECIAL TERMINATION ADVANCE NOTICE OF BORROWING

            The undersigned, a duly authorized signatory of the undersigned
borrower (the "BORROWER"), hereby certifies to CITICORP NORTH AMERICA, INC. (the
"LIQUIDITY PROVIDER"), with reference to the Revolving Credit Agreement
(2004-ERJ1) dated as of June 29, 2004, 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:

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

            (2) The Borrower is delivering this Notice of Borrowing for the
      making of the CNAI Special Termination Advance by the Liquidity Provider
      to be used for the funding of the CNAI Sub-Account of the Cash Collateral
      Account in accordance with Section 3.6(k) of the Intercreditor Agreement
      by reason of the receipt by the Borrower of a CNAI Special Termination
      Notice from the Liquidity Provider with respect to the Liquidity
      Agreement, which Advance is requested to be made on ____________, ____.
      The CNAI Special Termination Advance should be transferred to [name of
      bank/wire instructions/ABA number] in favor of account number [ __ ],
      reference [ __ ].

            (3) The amount of the CNAI Special Termination 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 CNAI Sub-Account of the Cash Collateral Account in
      accordance with Sections 3.6(f) and 3.6(k) of the Intercreditor Agreement,
      (ii) does not include any amount with respect to the payment of principal
      of, or premium on, the Certificates, (iii) was computed in accordance with
      the provisions of the Certificates, the 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.

            (4) Upon receipt by or on behalf of the Borrower of the amount
      requested hereby, (a) the Borrower will deposit such amount in the CNAI
      Sub-Account of the Cash Collateral Account and apply the same in
      accordance with the terms of Sections 3.6(f) and 3.6(k) 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 CNAI Special Termination 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 CNAI Special Termination 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:





       SCHEDULE I TO CNAI SPECIAL TERMINATION ADVANCE NOTICE OF BORROWING

          [Insert copy of computations in accordance with CNAI Special
                    Termination Advance Notice of Borrowing]








                                                                   Annex VIII to
                                                      Revolving Credit Agreement


                       NOTICE OF CNAI SPECIAL TERMINATION


                                                    [Date]

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

Attention: Corporate Trust Administration

            Revolving Credit Agreement dated as of June 29, 2004, between
            Wilmington Trust Company, as Subordination Agent, as agent and
            trustee for the Continental Airlines Pass Through Trust
            2004-ERJ1, as Borrower, and Citicorp North America, Inc. (the
            "LIQUIDITY AGREEMENT")


Ladies and Gentlemen:

            You are hereby notified that, pursuant to Section 6.01(b) of the
Liquidity Agreement, by reason of the aggregate Pool Balance of the Certificates
exceeding the aggregate outstanding principal amount of the Equipment Notes
(other than any Equipment Notes previously sold or with respect to which the
collateral securing such Equipment Notes has been disposed of) during the
18-month period prior to September 1, 2019, we are giving this notice to you in
order to cause (i) our obligations to make Advances 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 CNAI Special Termination Advance
under the Liquidity Agreement pursuant to Section 3.6(k) of the Intercreditor
Agreement as a consequence of your receipt of this notice.

            Terms used but not defined herein shall have the respective meanings
ascribed thereto in or pursuant to the Liquidity Agreement.






            THIS NOTICE IS THE "NOTICE OF CNAI SPECIAL 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,

                                    CITICORP NORTH AMERICA, INC.,
                                    as Liquidity Provider

                                    By________________________________________
                                    Name:
                                    Title:



cc:  Wilmington Trust Company,
     as Trustee








June 29, 2004

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

Ladies and gentlemen:

In consideration of Wilmington Trust Company ("Wilmington"), in the capacities
described below, entering into (a) the Revolving Credit Agreement (2004-ERJ1),
dated as of June 29, 2004 (the "Revolving Credit Agreement") between Wilmington,
as "Subordination Agent", as agent and as trustee for the Continental Airlines
Pass Through Trust 2004-ERJ1 (the "Trustee"), as "Borrower" and Citicorp North
America, Inc., a direct wholly-owned subsidiary of Citicorp ("Sub"), as
Liquidity Provider and (b) the Intercreditor Agreement (2004-ERJ1) dated as of
June 29, 2004 (the "Intercreditor Agreement" and, together with the Revolving
Credit Agreement, the "Guaranteed Documents") among Wilmington, not in its
individual capacity but solely as Trustee, Sub, as Liquidity Provider and
Wilmington, not in its individual capacity except as expressly set forth therein
but solely as Subordination Agent and trustee thereunder (Wilmington, in each of
its capacities under the Guaranteed Documents, collectively, the "Beneficiary"),
Citicorp, a corporation incorporated under the laws of Delaware (the
"guarantor"), hereby agrees in accordance with the following:

1.  Citicorp guarantees to the Beneficiary the payment of the amounts owing by
    Sub in accordance with the provisions of the Guaranteed Documents (the
    "guaranteed obligations"), subject to the terms set forth below (this
    "guarantee").

2.  Except to the extent this guarantee is reinstated in accordance with
    paragraph 8 below, the total liability of the guarantor under this guarantee
    shall in no case exceed $9,158,032.86.

3.  This guarantee is a guarantee of payment and not of collection.

4.  The guarantor hereby waives any requirement that the Beneficiary protect,
    secure, perfect or insure any security interest or lien on any property
    subject thereto or exhaust any right or take any action against any person
    or any collateral (including any rights relating to marshaling of assets).

5.  The guarantor's obligations under this guarantee shall rank PARI PASSU with
    the guarantor's senior unsecured debt obligations.



June 29, 2004
Page2




6.  The guarantor's obligations under this guarantee are irrevocable, and may
    not be unilaterally terminated by the guarantor.

7.  The guarantor hereby guarantees that the guaranteed obligations will be paid
    strictly in accordance with the terms of the Guaranteed Documents or any
    other agreement relating thereto, regardless of the value, genuineness,
    validity, regularity or enforceability of the guaranteed obligations, and of
    any law, regulation or order now or hereafter in effect in any jurisdiction
    affecting any of such terms or the rights of the Beneficiary with respect
    thereto and the liability of the guarantor to the extent herein set forth
    shall be absolute and unconditional, not subject to any reduction,
    limitation, impairment, termination, defense, offset, counterclaim or
    recoupment whatsoever (all of which are hereby expressly waived by the
    guarantor) whether by reason of any claim of any character whatsoever,
    including, without limitation, any claim of waiver, release, surrender,
    alteration or compromise, or by reason of any liability at any time to the
    guarantor or otherwise, whether based upon any obligations or any other
    agreement or otherwise, and howsoever arising, whether out of action or
    inaction or otherwise and whether resulting from default, willful
    misconduct, negligence or otherwise, and without limiting the foregoing,
    irrespective of:

    (a) any lack of validity or enforceability of any agreement or instrument
    relating to the guaranteed obligations;

    (b) any change in the time, manner or place of payment of, or in any other
    term in respect of, all or any of the guaranteed obligations, or any other
    amendment or waiver of or consent to any departure from any other agreement
    relating to any guaranteed obligations; any change in the time, manner or
    place of payment of, or in any other term in respect of, all or any of the
    guaranteed obligations, or any other amendment or waiver of or consent to
    any departure from any other agreement relating to any guaranteed
    obligations;

    (c) any increase in, addition to, exchange or release of, or nonperfection
    of any lien on or security interest in, any collateral, or any release or
    amendment or waiver of or consent to any departure from or failure to
    enforce any other guarantee, for all or any of the indebtedness;

    (d) any other circumstance which might otherwise constitute a defense
    available to, or a discharge of, Sub in respect of the guaranteed
    obligations or the guarantor in respect hereof;

    (e) The absence of any action on the part of the Beneficiary to obtain
    payment of the guaranteed obligations from Sub;




June 29, 2004
Page2





    (f) any insolvency, bankruptcy, reorganization or dissolution, or any
    similar proceeding of Sub, including, without limitation, rejection of the
    guaranteed obligations in such bankruptcy; or

    (g) the absence of notice or any delay in any action to enforce any
    guaranteed obligations or to exercise any right or remedy against the
    guarantor, or Sub, whether hereunder, under any guaranteed obligations or
    any agreement or any indulgence, compromise or extension granted;

    provided, however, Guarantor shall retain all those defenses of Sub that
    would be available to Guarantor if it were primary co-obligor, jointly and
    severally liable with Sub, on the guaranteed obligations.

8.  The guarantor further agrees that, to the extent that Sub or the guarantor
    makes a payment or payments to the Beneficiary, which payment or payments or
    any part thereof are subsequently invalidated, declared to be fraudulent or
    preferential, set aside and/or required to be repaid to Sub or the guarantor
    or their respective estate, trustee, receiver or any other party under any
    bankruptcy law, state or federal law, common law or equitable cause, then to
    the extent of such payment or repayment, this guarantee and the advances or
    part thereof which have been paid, reduced or satisfied by such amount shall
    be reinstated and continued in full force and effect as of the date such
    initial payment, reduction or satisfaction occurred.

9.  Until the guaranteed obligations are paid in full, the guarantor shall have
    no rights (direct or indirect) of subrogation, contribution, reimbursement,
    indemnification, or other rights of payment or recovery from Sub for any
    payments made by the guarantor hereunder.

10. This guarantee shall be binding upon and shall inure to the benefit of the
    parties hereto and their respective successors and assigns, including,
    without limitation, the Beneficiary.

11. No waiver of any provision of this guarantee and no consent to any departure
    by the guarantor therefrom, shall be effective unless it is in writing and
    consented to by the Beneficiary, and then such a waiver or consent shall be
    effective only in the specific instance and for the specific purpose for
    which given.

12. If any portion of the guaranteed obligations shall not be paid as and when
    such guaranteed obligations are due and payable under the Guaranteed
    Documents, the guarantor shall pay the amounts thereof to the Beneficiary as
    and when such guaranteed obligations are due and payable under the
    Guaranteed Documents and in accordance with the terms thereof.




June 29, 2004
Page2





13. Subject to section 8 above, this guarantee and the obligations of the
    guarantor hereunder shall be irrevocably valid until:

    (a) return by the Beneficiary of the original of this guarantee or

    (b) the close of business in New York on July 11, 2005 (the "Final
    Termination Date").

    Subject to section 8 above, no claim by the Beneficiary may be asserted
    under this guarantee after the Final Termination Date.

14. Citicorp shall be obligated to make payment hereunder only at the principal
    office of Sub in New York City.

15. This guarantee shall be governed by and construed in accordance with the
    laws of the State of New York. The guarantor submits to personal
    jurisdiction and service of process in any proceeding relating to this
    guarantee in a federal or state court located in the Borough of Manhattan in
    New York City.

IN WITNESS WHEREOF, Citicorp has caused these presents to be executed by its
duly authorized officer this twenty-ninth day of June two thousand four.



Very truly yours,



CITICORP



By:
   ---------------------------
        Vice President






                             INTERCREDITOR AGREEMENT
                                   (2004-ERJ1)

                                   Dated as of

                                  June 29, 2004

                                      AMONG

                            WILMINGTON TRUST COMPANY,
                         not in its individual capacity
                         but solely as Trustee under the
                Continental Airlines Pass Through Trust 2004-ERJ1


                                   WESTLB AG,
                                New York Branch,

                                       and

                          CITICORP NORTH AMERICA, INC.,

                             as Liquidity Providers

                                       AND

                            WILMINGTON TRUST COMPANY,
                      not in its individual capacity except
                        as expressly set forth herein but
                    solely as Subordination Agent and Trustee






                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE I  DEFINITIONS.......................................................2
   SECTION 1.1  Definitions..................................................2

ARTICLE II  TRUST ACCOUNTS; CONTROLLING PARTY...............................17
   SECTION 2.1  Agreement to Terms of Subordination;
                  Payments from Monies Received Only........................17
   SECTION 2.2  Trust Accounts..............................................18
   SECTION 2.3  Deposits to the Collection Account and
                  Special Payments Account..................................19
   SECTION 2.4  Distributions of Special Payments...........................20
   SECTION 2.5  Designated Representatives..................................22
   SECTION 2.6  Controlling Party...........................................23

ARTICLE III  RECEIPT, DISTRIBUTION AND APPLICATION OF
                  AMOUNTS RECEIVED..........................................24
   SECTION 3.1  Written Notice of Distribution..............................24
   SECTION 3.2  Distribution of Amounts on Deposit in the
                  Collection Account........................................26
   SECTION 3.3  Distribution of Amounts on Deposit
                  Following a Triggering Event..............................27
   SECTION 3.4  Other Payments..............................................29
   SECTION 3.5  Payments to the Trustee and the Liquidity
                  Provider..................................................29
   SECTION 3.6  Liquidity Facilities........................................30

ARTICLE IV  EXERCISE OF REMEDIES............................................36
   SECTION 4.1  Directions from the Controlling Party.......................36
   SECTION 4.2  Remedies Cumulative.........................................37
   SECTION 4.3  Discontinuance of Proceedings...............................38
   SECTION 4.4  Right of Certificateholders to Receive
                  Payments Not to Be Impaired...............................38
   SECTION 4.5  Undertaking for Costs.......................................38

ARTICLE V  DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS
                  OF TRUSTEE, ETC...........................................39
   SECTION 5.1  Notice of Indenture Default or Triggering
                  Event.....................................................39
   SECTION 5.2  Indemnification.............................................40
   SECTION 5.3  No Duties Except as Specified in
                  Intercreditor Agreement...................................40
   SECTION 5.4  Notice from the Liquidity Provider and
                  Trustee...................................................41

ARTICLE VI  THE SUBORDINATION AGENT.........................................41
   SECTION 6.1  Authorization; Acceptance of Trusts and
                  Duties....................................................41



                                TABLE OF CONTENTS
                                   (Continued)
                                                                            Page
                                                                            ----

   SECTION 6.2  Absence of Duties...........................................41
   SECTION 6.3  No Representations or Warranties as to
                  Documents.................................................41
   SECTION 6.4  No Segregation of Monies; No Interest.......................41
   SECTION 6.5  Reliance; Agents; Advice of Counsel.........................42
   SECTION 6.6  Capacity in Which Acting....................................42
   SECTION 6.7  Compensation................................................42
   SECTION 6.8  May Become Certificateholder................................43
   SECTION 6.9  Subordination Agent Required; Eligibility...................43
   SECTION 6.10  Money to Be Held in Trust..................................43

ARTICLE VII  INDEMNIFICATION OF SUBORDINATION AGENT.........................43
   SECTION 7.1  Scope of Indemnification....................................43

ARTICLE VIII  SUCCESSOR SUBORDINATION AGENT.................................44
   SECTION 8.1  Replacement of Subordination Agent;
                  Appointment of Successor..................................44

ARTICLE IX  SUPPLEMENTS AND AMENDMENTS......................................45
   SECTION 9.1  Amendments, Waivers, Etc....................................45
   SECTION 9.2  Subordination Agent Protected...............................46
   SECTION 9.3  Effect of Supplemental Agreements...........................46
   SECTION 9.4   Notice to Rating Agencies..................................46

ARTICLE X  MISCELLANEOUS....................................................47
   SECTION 10.1  Termination of Intercreditor Agreement.....................47
   SECTION 10.2  Intercreditor Agreement for Benefit of
                      the Trustee, the Liquidity Providers
                  and the Subordination Agent...............................47
   SECTION 10.3  Notices....................................................47
   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..............................................50
   SECTION 10.10  Governing Law.............................................51
   SECTION 10.11  Submission to Jurisdiction; Waiver of
                  Jury Trial; Waiver of Immunity............................51




                       INTERCREDITOR AGREEMENT (2004-ERJ1)

            INTERCREDITOR AGREEMENT (2004-ERJ1) dated as of June 29, 2004 (this
"AGREEMENT"), among WILMINGTON TRUST COMPANY, a Delaware corporation ("WTC"),
not in its individual capacity but solely as Trustee of the Trust (as defined
below), WESTLB AG, a joint stock company ("Aktiengesellschaft") organized under
the laws of Germany, acting through its New York Branch ("WESTLB"), as a
Liquidity Provider, Citicorp North America, Inc. ("CNAI"), a Delaware
corporation and a direct wholly-owned subsidiary of Citicorp, as a 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 non-recourse basis one series of Equipment Notes to
finance the debt portion of the purchase price of the Aircraft referred to in
such Indenture which will be leased to Continental pursuant to the related
Lease;

            WHEREAS, pursuant to the Financing Agreements, the Trust will
acquire the Equipment Notes;

            WHEREAS, pursuant to the Trust Agreement, the Trust proposes to
issue Certificates bearing the interest rate and having the final distribution
date described in the Trust Agreement on the terms and subject to the conditions
set forth therein;

            WHEREAS, pursuant to the Underwriting Agreement, the Underwriters
propose to purchase Certificates issued by the Trust in the aggregate face
amount set forth on Schedule I thereto on the terms and subject to the
conditions set forth therein;

            WHEREAS, each Liquidity Provider proposes to enter into a separate
Liquidity Facility with the Subordination Agent, as agent for the Trustee, for
the benefit of the Certificateholders;

            WHEREAS, Citicorp, a Delaware corporation (the "GUARANTOR"), will
guarantee in full, pursuant to a separate guarantee dated as of the date hereof
(the "GUARANTEE AGREEMENT"), the obligations of CNAI under its Liquidity
Facility; and

            WHEREAS, it is a condition precedent to the obligations of the
Underwriters under the Underwriting Agreement that the Subordination Agent, the
Trustee and the Liquidity Providers agree to the terms of subordination set
forth in this Agreement in respect of the Certificates, and the Subordination
Agent, the Trustee 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.




            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".

            "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. "ACCELERATE",
"ACCELERATED" and "ACCELERATING" have meanings correlative to the foregoing.

            "ADVANCE", with respect to any Liquidity Facility, means any
Advances as defined 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 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, that would be payable on the Certificates on each of the
eighteen successive Regular Distribution Dates immediately following such day
or, if such day is a Regular Distribution Date, on such day and the succeeding
seventeen Regular Distribution Dates, in each case calculated on the basis of
the Pool Balance (subject to the proviso in the definition of "Required Amount"
below) on such date and without regard to expected future payments of principal
on the Certificates.




            "AGREEMENT" has the meaning assigned to such term in the first
paragraph of this Agreement.

            "AIRCRAFT" means, with respect to each Indenture, the "Aircraft"
referred to therein.

            "APPRAISAL" has the meaning assigned to such term in Section
4.1(a)(iii).

            "APPRAISERS" means Aviation Specialist Group, AvSolutions and BK
Associates or any other nationally recognized appraiser reasonably selected by
the Subordination Agent or the Controlling Party.

            "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, a CNAI
Special Termination Drawing, a WestLB Early Termination Drawing, a WestLB
Expiration Drawing or a Final Drawing under such Liquidity Facility, the
Available Amount of such Liquidity Facility shall be zero.

            "BASIC AGREEMENT" means the Pass Through Trust Agreement dated as of
September 25, 1997 between Continental and WTC, not in its individual capacity,
except as otherwise expressly provided therein, but solely as trustee.

            "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 the Trustee, the Subordination Agent or any Loan Trustee
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 an Eligible Deposit Account
consisting of the Sub-Accounts 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 any Liquidity Facility pursuant
to Section 3.6(c), 3.6(d), 3.6(i), 3.6(k) or 3.6(l) shall be deposited.

            "CERTIFICATES" means the certificates issued by the Trust,
substantially in the form of Exhibit A to the Trust Agreement, and authenticated
by the Trustee, representing fractional undivided interests in the Trust, and
any certificates issued in exchange therefor or replacement thereof pursuant to
the terms of the Trust Agreement.

            "CERTIFICATEHOLDER" means, at any time, any holder of one or more
Certificates.

            "CLOSING DATE" means June 29, 2004.

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




            "CNAI FEE LETTER" means the Fee Letter dated the date hereof among
CNAI, Embraer, Continental and the Subordination Agent with respect to the
initial CNAI Liquidity Facility.

            "CNAI LIQUIDITY FACILITY" means, initially, the Revolving Credit
Agreement, dated as of the date hereof, between the Subordination Agent, as
agent and trustee for the Trust, and CNAI, and, from and after the replacement
of such Revolving Credit 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.

            "CNAI SPECIAL TERMINATION DRAWING" has the meaning assigned to such
term in Section 3.6(k).

            "CNAI SPECIAL TERMINATION NOTICE" has the meaning assigned to such
term in the CNAI Liquidity Facility.

            "CNAI SUB-ACCOUNT" means, with respect to the Cash Collateral
Account, a sub-ledger account to such Cash Collateral Account designated "CNAI
Sub-Account".

            "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.

            "CONSENT PERIOD" has the meaning specified in Section 3.6(d).

            "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 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 specified 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 the Trustee, the
Subordination Agent or any Loan Trustee, 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 Triggering
Event Distributions with respect to the Certificates as of such Distribution
Date.

            "DELIVERY PERIOD EXPIRY DATE" means the earlier of (a) December 31,
2004, or, if the Equipment Notes relating to all of the Aircraft (or Substitute
Aircraft in lieu thereof) have not been purchased by the Trustee on or prior to
such date due to any reason beyond the control of Continental and not occasioned
by Continental's fault or negligence, March 31, 2005 and (b) the date on which
Equipment Notes with respect to all Aircraft (or Substitute Aircraft in lieu
thereof) have been purchased by the Trustee in accordance with the Note Purchase
Agreement.

            "DEPOSIT AGREEMENT" shall mean the Deposit Agreement dated as of the
date hereof between the Escrow Agent and the Depositary, as the same may be



amended, modified or supplemented from time to time in accordance with the terms
thereof.

            "DEPOSITARY" means WestLB AG, New York Branch, as depositary under
the Deposit Agreement.

            "DEPOSITS" has the meaning set forth in the Deposit Agreement.

            "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).

            "DOWNGRADE EVENT", with respect to any Liquidity Facility, has the
meaning assigned to such term in such Liquidity Facility.

            "DOWNGRADED FACILITY" has the meaning assigned to such term in
Section 3.6(c).

            "DRAWING" means an Interest Drawing, a Final Drawing, a
Non-Extension Drawing, a CNAI Special Termination Drawing, a WestLB Early
Termination Drawing, a WestLB Expiration 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 set-off and counterclaim with respect
to such account.

            "ELIGIBLE INSTITUTION" means (a) the corporate trust department of
the Subordination Agent or the 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 or issuer credit
rating, as the case may be, from each Rating Agency of at least A-3 or its
equivalent.

            "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 P-1 and A-1, respectively,
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 bank shall not be in excess of 5% of
such bank's capital surplus; PROVIDED FURTHER that 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;
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) above which is
issued or guaranteed by Continental or any of its Affiliates, and no investment
in the obligations of any one bank in excess of $10,000,000 shall be an Eligible
Investment, 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.

            "EMBRAER" means Embraer-Empresa Brasileira de Aeronautica S.A., a
company organized under the laws of Brazil, and its successors and assigns.

            "EQUIPMENT NOTES" means the 9.558% Equipment Notes issued pursuant
to any Indenture by the related Owner Trustee and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange therefor or
replacement thereof pursuant to the terms of such Indenture.

            "ESCROW AGENT" means Wells Fargo Bank Northwest, National
Association, as escrow agent under each Escrow and Paying Agent Agreement,
together with its successors in such capacity.

            "ESCROW AND PAYING AGENT AGREEMENT" shall mean the Escrow and Paying
Agent Agreement dated as of the date hereof among the Escrow Agent, the
Underwriters, the Trustee and the Paying Agent, as the same may be amended,
modified or supplemented from time to time in accordance with the terms thereof.

            "EXPECTED DISTRIBUTIONS" means, on any Current Distribution Date,
the sum of (x) accrued and unpaid interest on the Certificates (excluding
interest, if any, payable with respect to any Deposits) and (y) the difference
between (A) the Pool Balance 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), and (B) the Pool Balance as
of the Current Distribution Date calculated on the basis that (i) the principal
of the Equipment Notes has been paid when due (whether at stated maturity, upon



redemption, prepayment, purchase, Acceleration or otherwise) and such payments
have been distributed to the Certificateholders and (ii) the principal of any
Equipment Notes formerly held in the Trust that have been sold pursuant to the
terms hereof has been paid in full and such payments have been distributed to
the Certificateholders, but without giving effect to any reduction in the Pool
Balance as a result of any distribution attributable to Deposits occurring after
the immediately preceding Distribution Date (or, if the Current Distribution
Date is the first Distribution Date, occurring after the initial issuance of the
Certificates). For purposes of calculating Expected Distributions, any premium
paid on the Equipment Notes that has not been distributed to the
Certificateholders (other than such premium or a portion thereof applied to the
payment of interest on the Certificates or the reduction of the Pool Balance)
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 LETTERS" means, collectively, the CNAI Fee Letter and the
WestLB Fee Letter and any fee letter entered into between the Subordination
Agent, Embraer, Continental and any Replacement Liquidity Provider in respect of
a Liquidity Facility.

            "FINAL DRAWING" has the meaning assigned to such term in Section
3.6(i).

            "FINAL LEGAL DISTRIBUTION DATE" means March 1, 2021.

            "FINANCING AGREEMENTS" means each of the Participation Agreements
and the Note Purchase Agreement.

            "GUARANTEE AGREEMENT" has the meaning assigned to such term in the
preliminary statements to this Agreement.

            "GUARANTOR" has the meaning assigned to such term in the preliminary
statements to this Agreement.

            "INDENTURE" means each of the Trust Indentures entered into by the
Loan Trustee and the Owner Trustee pursuant to the Note Purchase Agreement, in
each case as the same may be amended, supplemented or otherwise modified from
time to time in accordance with its terms.

            "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).

            "INTEREST PAYMENT DATE" means each date on which interest is due and
payable under the Liquidity Facilities on a Downgrade Drawing, Non-Extension
Drawing, CNAI Special Termination Drawing, WestLB Early Termination Drawing,
WestLB Expiration Drawing or Final Drawing thereunder, other than any such date
on which interest is due and payable under the Liquidity Facilities only on an
Applied Provider Advance (as such term is defined in the Liquidity Facilities).




            "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 the Liquidity Facility of
each initial Liquidity Provider, the lending office of such Liquidity Provider
presently located at New York, New York, or such other lending office as such
Liquidity Provider from time to time shall notify the Trustee as its lending
office under such Liquidity Facility; PROVIDED that no Liquidity Provider shall
change its Lending Office to a Lending Office outside the United States of
America except in accordance with the applicable 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", with respect to any Liquidity
Facility, has the meaning assigned to such term in such Liquidity Facility.

            "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 FACILITIES" means, collectively, the CNAI Liquidity
Facility and the WestLB Liquidity Facility.

            "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 Letters.

            "LIQUIDITY PROVIDERS" means WestLB and CNAI, together with any
Replacement Liquidity Provider which has issued a Replacement Liquidity Facility
to replace any Liquidity Facility pursuant to Section 3.6(e).

            "LOAN TRUSTEE" means, with respect to any Indenture, the mortgagee
thereunder.

            "LP INCUMBENCY CERTIFICATE" has the meaning assigned to such term in
Section 2.5(c).

            "LP REPRESENTATIVES" has the meaning assigned to such term in
Section 2.5(c).

            "MOODY'S" means Moody's Investors Service, Inc.

            "NON-CONTROLLING PARTY" means, at any time, the Trustee and each
Liquidity Provider, if such person 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.

            "NOTE PURCHASE AGREEMENT" means the Note Purchase Agreement dated as
of the date hereof, among Continental, the Trustee, the Escrow Agent, the
Subordination Agent and the Paying Agent, as amended, supplemented or otherwise
modified from time to time in accordance with its terms.

            "OFFICER'S CERTIFICATE" of any Person means a certification signed
by a Responsible Officer of such Person.

            "OPERATIVE AGREEMENTS" means this Agreement, the Liquidity
Facilities, the Guarantee Agreement, the Underwriting Agreement, the Indentures,
the Trust Agreement, the Leases, the Financing Agreements, the Fee Letters, 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 the Certificates, as
of the date of determination, all Certificates theretofore authenticated and
delivered under the Trust Agreement, except:


                  (i) Certificates theretofore canceled by the Registrar (as
            defined in the Trust Agreement) or delivered to the Trustee or such
            Registrar for cancellation;

                  (ii) Certificates 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 Trustee in trust for the holders of
            the Certificates as provided in Section 4.01 of the Trust Agreement
            pending distribution of such money to the Certificateholders
            pursuant to such final distribution payment; and

                  (iii) Certificates in exchange for or in lieu of which other
            Certificates have been authenticated and delivered pursuant to the
            Trust Agreement;

      PROVIDED, HOWEVER, that in determining whether the holders of the
      requisite Outstanding amount of the 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 the Trustee shall be protected in relying upon any such request,
      demand, authorization, direction, notice, consent or waiver, only
      Certificates that the 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 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 PARTICIPANT" means, with respect to any Participation
Agreement, the owner participant thereunder.

            "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.

            "PAYEE" has the meaning assigned to such term in Section 2.4(e).

            "PAYING AGENT" means Wilmington Trust Company, as paying agent under
the Escrow and Paying Agent Agreement, together with its successors in such
capacity.

            "PERFORMING EQUIPMENT NOTE" means an Equipment Note 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
under Title 11 of the United States Code (the "BANKRUPTCY CODE") in which
Continental is a debtor any payment default existing during the 60-day period
under Section 1110(a)(2)(A) of the Bankruptcy Code (or such longer period as may
apply under Section 1110(b) of the Bankruptcy Code or as may apply for the cure
of such payment default under Section 1110(a)(2)(B) of the Bankruptcy Code)
shall not be taken into consideration until the expiration of the applicable
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, as of any date, (i) the original aggregate
face amount of the Certificates LESS (ii) the aggregate amount of all payments
made in respect of the Certificates or in respect of Deposits other than
payments made in respect of interest or premium thereon or reimbursement of any
costs and expenses in connection therewith. The Pool Balance as of any
Distribution Date shall be computed after giving effect to any special
distribution with respect to unused Deposits, payment of principal of the
Equipment Notes or payment with respect to other Trust Property and the
distribution thereof to be made on that date.




            "PROCEEDING" means any suit in equity, action at law or other
judicial or administrative proceeding.

            "PRO RATA PORTION", with respect to any Liquidity Facility or
Sub-Account, for any day, means a fraction (expressed as a percentage rounded to
a sufficient number of decimal places such that the sum of the Pro Rata Portions
shall equal 100.00%), the numerator of which is the Required Amount for such
Liquidity Facility or Sub-Account for such day and the denominator of which is
the Aggregate Required Amount for such day.

            "PTC EVENT OF DEFAULT" means the failure to pay within 10 Business
Days of the due date thereof: (i) the outstanding Pool Balance of the
Certificates on the Final Legal Distribution Date or (ii) interest due on the
Certificates on any Distribution Date (unless the Subordination Agent shall have
made an Interest Drawing, or a withdrawal from the Cash Collateral Account, with
respect thereto in an aggregate amount sufficient to pay such interest and shall
have distributed such amount to the Trustee).

            "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. The initial Rating
Agencies will be 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 the Certificates
below the then current rating for the Certificates or (ii) a withdrawal or
suspension of the rating of the Certificates.

            "REGULAR DISTRIBUTION DATES" means the 1st day of each month,
commencing on August 1, 2004; 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,
an irrevocable revolving credit agreement (or agreements) in substantially the
form of the replaced Liquidity Facility, including reinstatement provisions, or
in such other form or forms (which may include a letter of credit, surety bond,
financial insurance policy or guaranty) as shall permit the Rating Agencies to
confirm in writing their respective ratings then in effect for the Certificates
(before downgrading of such ratings, if any, as a result of the downgrading of
the replaced Liquidity Provider), in a face amount (or in an aggregate face
amount) equal to the then Required Amount for the replaced Liquidity Facility
and issued by a Person (or Persons) having an unsecured short-term debt rating
and a short-term issuer credit rating, as the case may be, issued by both Rating
Agencies which are equal to or higher than the Threshold Rating or such other
ratings and qualifications as shall permit the Rating Agencies to confirm in
writing their respective ratings then in effect for the Certificates (before the
downgrading of such ratings, if any, as a result of the downgrading of the
replaced Liquidity Provider). Without limitation of the form that a Replacement
Liquidity Facility otherwise may have pursuant to the preceding sentence, a
Replacement Liquidity Facility may have a stated expiration date earlier than 15
days after the Final Legal Distribution Date of the Certificates so long as such
Replacement Liquidity Facility provides for a Non-Extension Drawing as
contemplated by Section 3.6(d)(i) hereof.




            "REPLACEMENT LIQUIDITY PROVIDER" means a Person (or Persons) who
issues a Replacement Liquidity Facility.

            "REPLACEMENT LIQUIDITY PROVIDER SUB-ACCOUNT" means, with respect to
any Cash Collateral Account, a sub-ledger account to such Cash Collateral
Account having a designation indicating that it is a Sub-Account with respect to
such Replacement Liquidity Provider.

            "REQUIRED AMOUNT" means (i) with respect to the WestLB Liquidity
Facility or the WestLB Sub-Account, for any day, the Aggregate Required Amount
for such day LESS the amount specified in clause (ii) below for such day and
(ii) with respect to the CNAI Liquidity Facility or CNAI Sub-Account, for any
day, the sum of the aggregate amount of interest, calculated at the rate per
annum equal to the Stated Interest Rate, that would be payable on the
Certificates on each of the eighteen successive Regular Distribution Dates
immediately following such day or, if such day is a Regular Distribution Date,
on such day and the succeeding seventeen Regular Distribution Dates, in each
case calculated on the basis of a Pool Balance equal to the lower of (x)
$63,876,911.93 and (y) the Pool Balance on such day and without regard to
expected future payments of principal on the Certificates; PROVIDED that, for
any date, the Pool Balance for purposes of determining the Aggregate Required
Amount or the amount in clause (ii) above (after determining the lower of
subclauses (x) and (y) as provided therein), shall, in the event of (A) the
disposition of any Aircraft pursuant to the exercise of remedies under an
Indenture on or prior to such date, be deemed to be reduced by an amount equal
to the outstanding principal amount of the Equipment Note secured by such
Aircraft that remains unpaid after giving effect to the application under such
Indenture of proceeds from the disposition of such Aircraft and any amounts
otherwise received from Continental in connection with such disposition at or
prior to the time of such disposition or (B) the sale of any Equipment Note
pursuant to the Intercreditor Agreement on or prior to such date, be deemed to
be reduced by an amount equal to the excess of (x) the outstanding amount of
principal as of the date of sale of such Equipment Note over (y) the excess of
(A) the net purchase price received with respect to the sale of such Equipment
Note over (B) the outstanding amount of interest accrued and payable under such
Equipment Note as of the date of sale of such Equipment Note.

            "RESERVE ACCOUNT" means the Eligible Deposit Account established by
the Subordination Agent pursuant to Section 2.2 from which the Subordination
Agent shall make withdrawals to fund the Appraisals in accordance with Section
4.1 hereof.

            "RESERVE AMOUNT" means $75,000.

            "RESPONSIBLE OFFICER" means (i) with respect to the Subordination
Agent and the Trustee, any officer in the corporate trust administration
department of the Subordination Agent or the 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.

            "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, 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, or (ii) any payment of interest on the Certificates with funds
drawn under any Liquidity Facility or any Sub-Account of the Cash Collateral
Account; 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.

            "SECTION 2.4(B) FRACTION" has the meaning assigned to such term in
Section 2.4(b).

            "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.

            "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 Services, a
division of The McGraw-Hill Companies, Inc.

            "STATED AMOUNT" means, with respect to any Liquidity Facility, the
Maximum Commitment (as defined in such Liquidity Facility) of the applicable
Liquidity Provider thereunder.

            "STATED EXPIRATION DATE" has the meaning specified in Section
3.6(d)(i).

            "STATED INTEREST RATE" means 9.558% per annum.

            "SUB-ACCOUNT" means, collectively, the CNAI Sub-Account, the WestLB
Sub-Account and any Replacement Liquidity Provider Sub-Account.

            "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).




            "SUBSTITUTE AIRCRAFT" has the meaning set forth in the Note Purchase
Agreement.

            "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.

            "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 short-term issuer credit rating of A-1 by Standard & Poor's;
provided that so long as CNAI is the Liquidity Provider for any Liquidity
Facility, the Threshold Rating shall apply to the Guarantor in the case of such
Liquidity Facility.

            "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, (y) the
Acceleration of all of the outstanding Equipment Notes (PROVIDED that, with
respect to the period prior to the Delivery Period Expiry Date, the aggregate
principal balance of such Equipment Notes is in excess of $108,000,000) or (z)
the occurrence of a Continental Bankruptcy Event.

            "TRIGGERING EVENT DISTRIBUTIONS" means, on any Current Distribution
Date, the sum of (x) the aggregate amount of all accrued and unpaid interest on
the Certificates (excluding interest, if any, payable with respect to the
Deposits) and (y) the Pool Balance 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) (less the amount of the
Deposits as of such preceding Distribution Date (or, if the Current Distribution
Date is the first Distribution Date, the Closing Date) other than any portion of
such Deposits thereafter used to acquire Equipment Notes pursuant to the Note
Purchase Agreement). For purposes of calculating the Triggering Event
Distributions, any premium paid on the Equipment Notes that has not been
distributed to the Certificateholders (other than such premium or a portion
thereof applied to the payment of interest on the Certificates or the reduction
of the Pool Balance) shall be added to the amount of the Triggering Event
Distributions.




            "TRUST" means the Continental Airlines Pass Through Trust 2004-ERJ1
created and administered pursuant to the Trust Agreement.

            "TRUST ACCOUNTS" has the meaning assigned to such term in Section
2.2(a).

            "TRUST AGREEMENT" means the Basic Agreement, as supplemented by the
Trust Supplement No. 2004-ERJ1 thereto, dated the date hereof, governing the
creation and administration of the Pass Through Trust 2004-ERJ1 and the issuance
of the Certificates, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.

            "TRUSTEE" means WTC, not in its individual capacity except as
expressly set forth in the Trust Agreement, but solely as trustee under the
Trust Agreement, together with any successor trustee appointed pursuant thereto.

            "TRUSTEE INCUMBENCY CERTIFICATE" has the meaning assigned to such
term in Section 2.5(b).

            "TRUSTEE REPRESENTATIVES" has the meaning assigned to such term in
Section 2.5(b).

            "TRUST INDENTURE ESTATE" with respect to any Indenture, has the
meaning assigned to such term in such Indenture.

            "TRUST PROPERTY" has the meaning set forth in the Trust Agreement.

            "UNAPPLIED PROVIDER ADVANCE", with respect to any Liquidity
Facility, has the meaning specified in such Liquidity Facility.

            "UNDERWRITERS" means Citigroup Global Markets Inc. and Morgan
Stanley & Co. Incorporated.

            "UNDERWRITING AGREEMENT" means the Underwriting Agreement dated June
18, 2004 among the Underwriters, the Depositary, Embraer 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.

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

            "WESTLB EARLY TERMINATED FACILITY" has the meaning assigned to such
term in Section 3.6(d)(ii).

            "WESTLB EARLY TERMINATION DRAWING" has the meaning assigned to such
term in Section 3.6(d)(ii)

            "WESTLB EARLY TERMINATION DATE" means the date specified in a WestLB
Early Termination Notice delivered by a Liquidity Provider to the Subordination



Agent in accordance with Section 3.6(d)(ii), which date shall not be earlier
than the 25th day following the receipt by the Subordination Agent of such
WestLB Early Termination Notice.

            "WESTLB EARLY TERMINATION NOTICE" has the meaning assigned to such
term in Section 3.6(d)(ii).

            "WESTLB EARLY TERMINATION NOTICE PERIOD" has the meaning assigned to
such term in Section 3.6(d)(ii).

            "WESTLB EXPIRED FACILITY" has the meaning assigned to such term in
Section 3.6(l).

            "WESTLB EXPIRATION DRAWING" has the meaning assigned to such term in
Section 3.6(l).

            "WESTLB FEE LETTER" means the Fee Letter dated the date hereof among
WestLB, Embraer, Continental and the Subordination Agent with respect to the
initial WestLB Liquidity Facility.

            "WESTLB LIQUIDITY FACILITY" means, initially, the Revolving Credit
Agreement, dated as of the date hereof, between the Subordination Agent, as
agent and trustee for the Trust, and WestLB, and, from and after the replacement
of such Revolving Credit 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.

            "WESTLB SUB-ACCOUNT" means, with respect to the Cash Collateral
Account, a sub-ledger account to such Cash Collateral Account designated "WestLB
Sub-Account".

            "WRITTEN NOTICE" means, from the Subordination Agent, the Trustee or
any Liquidity Provider, a written instrument executed by the Designated
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 such term in the recital of
parties to this Agreement.


                                   ARTICLE II

                        TRUST ACCOUNTS; CONTROLLING PARTY

            SECTION 2.1 AGREEMENT TO TERMS OF SUBORDINATION; PAYMENTS FROM
MONIES RECEIVED ONLY. (a) The Trustee hereby acknowledges and agrees to the
terms of subordination and distribution set forth in this Agreement in respect
of the 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, the Trustee hereby



agrees to cause the Equipment Notes purchased by the Trust to be registered in
the name of the Subordination Agent or its nominee, as agent and trustee for the
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 or payments under Section 6 of the Note Purchase
Agreement, 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. The Trustee and the Subordination
Agent hereby agree and, as provided in the 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, have
agreed to look solely to such amounts to the extent available for distribution
to it as provided in this Agreement and to the relevant Deposits and that none
of the Owner Trustees, Loan Trustees, Owner Participants nor the Trustee or the
Subordination Agent is personally liable to any of them for any amounts payable
or any liability under this Agreement, the 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 Trustee) as expressly provided
in the Trust Agreement or (in the case of the Owner Trustees and the Loan
Trustees) 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 Trustee, the Certificateholders and the Liquidity Providers, (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 Trustee, the
Certificateholders and the Liquidity Providers and (iii) the Reserve 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 Trustee, the
Liquidity Providers and the Certificateholders. The Subordination Agent shall
establish and maintain the Cash Collateral Account (consisting of the CNAI
Sub-Account, the WestLB Sub-Account and any Replacement Liquidity Provider
Sub-Account related thereto) pursuant to and under the circumstances set forth
in Section 3.6(f) hereof. Upon such establishment and maintenance under Section
3.6(f) hereof, the Cash Collateral Account 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) 30 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, a
Non-Extension Drawing, a CNAI Special Termination Drawing, a WestLB Early



Termination Drawing or a WestLB Expiration Drawing under any Liquidity Facility,
the Subordination Agent shall invest and reinvest such amounts in the
Sub-Account related to such Liquidity Facility in Eligible Investments at the
direction of Continental (or, if and to the extent so specified to the
Subordination Agent by Continental, 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 amounts
on deposit in the Cash Collateral Account, 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
expressly provided in Section 3.4(b) 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 Trustee,
the Certificateholders and the Liquidity Providers, as the case may be. If, at
any time, any of the Trust Accounts or the Reserve Account 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, for which a Ratings
Confirmation shall have been obtained) establish a new Collection Account,
Special Payments Account, Reserve 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,
Reserve Account or Cash Collateral Account, as the case may be. So long as WTC
is an Eligible Institution, the Trust Accounts and the Reserve Account shall be
maintained with it as Eligible Deposit Accounts.

            (d)   The Subordination Agent shall possess all right, title and
interest in all funds on deposit from time to time in the Reserve Account. The
Reserve Account shall be used by the Subordination Agent solely to fund the
Appraisals when required to be obtained pursuant to Section 4.1 hereof.

            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 the 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 the Trustee a Written Notice of such
amount. 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)   REDEMPTIONS AND PURCHASES OF EQUIPMENT NOTES. (i) 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 prepayment 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 Distribution 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
      Distribution Date and the denominator of which is the aggregate
      outstanding principal amount of all Equipment Notes (the "SECTION 2.4(B)
      FRACTION"), shall be distributed to the Liquidity Providers pro rata on
      the basis of the amount of the Liquidity Expenses owed to each Liquidity
      Provider;

            SECOND, such amount as shall be required to pay (i) (A) all accrued
      and unpaid interest then in arrears on all Liquidity Obligations PLUS (B)
      the product of (x) the aggregate amount of all accrued and unpaid interest
      on all Liquidity Obligations not in arrears to such Special Distribution
      Date (at the rate provided in the Liquidity Facilities) MULTIPLIED BY (y)
      the Section 2.4(b) Fraction and (ii) if a CNAI Special Termination Drawing
      has been made under the CNAI Liquidity Facility and has not been converted
      into a Final Advance, the outstanding amount of such CNAI Special
      Termination Drawing, shall be distributed to the Liquidity Providers pro
      rata 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 Sub-Account of
      any Cash Collateral Account had been previously funded as provided in
      Section 3.6(f), to fund such Sub-Account up to its Required Amount shall
      be deposited in such Sub-Account, (B) if any Liquidity Facility shall
      become a Downgraded Facility, a Non-Extended Facility, a WestLB Early
      Terminated Facility or a WestLB Expired Facility at a time when
      unreimbursed Interest Drawings under such Liquidity Facility have reduced
      the Available Amount thereunder to zero, to fund the related Sub-Account
      of the Cash Collateral Account up to an amount equal to such Sub-Account's
      Required Amount shall be deposited in such Sub-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 an amount
      equal to the amount of any unreimbursed Interest Drawings under such
      Liquidity Facility shall be distributed to such Liquidity Provider, pro
      rata on the basis of the amounts of such deficiencies in respect of each
      Sub-Account and unreimbursed Interest Drawings in respect of each
      Liquidity Provider;

            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) such Liquidity Facility's Required
      Amount, pro rata 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 Certificates on such Special
      Distribution Date shall be distributed to the Trustee; and

            SIXTH, 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
and unpaid interest on the Certificates together with (without duplication)
accrued and unpaid interest on a portion of the Certificates equal to the
outstanding principal amount of the Equipment Notes held in the Trust and being
redeemed, purchased or prepaid (immediately prior to such redemption, purchase
or prepayment), in each case excluding interest, if any, payable with respect to
the Deposits".

            (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. Except for amounts constituting Liquidity
Obligations which shall be distributed as provided in Section 2.4(b), 3.2 or 3.3
(as the case may be), the Subordination Agent will distribute promptly upon
receipt thereof (i) any indemnity payment received by it from the Owner
Participant, the Owner Trustee or Continental in respect of the Trustee, any
Liquidity Provider, the Guarantor, the Paying Agent, the Depositary or the
Escrow Agent (collectively, the "PAYEES") and (ii) any compensation received by
it from the Owner Participant, the Owner Trustee or Continental under any
Operative Agreement 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 the Liquidity Providers
and the Trustee, and from time to time thereafter may furnish to the Liquidity
Providers and the 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 of the
Liquidity Providers and the Trustee receive 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, the Trustee shall furnish
to the Subordination Agent, and from time to time thereafter may furnish to the
Subordination Agent, at the 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 the Trustee certifying as to the incumbency and specimen
signatures of the officers of the Trustee and the attorney-in-fact and agents of
the Trustee (the "TRUSTEE REPRESENTATIVES") authorized to give Written Notices
on behalf of the 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 Trustee and the Liquidity
Providers hereby agree that, with respect to any Indenture at any given time,
the Loan Trustee 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 Trustee (with respect to the Equipment Notes issued under
such Indenture and held as Trust Property of the Trust) constituting, in the
aggregate, directions with respect to at least a majority of outstanding
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, if applicable,
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 upon the occurrence of an Indenture Default thereunder shall be
the Trustee. For purposes of giving effect to the rights of the Controlling
Party, the Trustee shall irrevocably agree, and the Certificateholders will 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 directed by the Controlling
Party and any vote so exercised shall be binding upon the Trustee 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 Available Amount
under any Liquidity Facility shall have been drawn (for any reason other than a
Downgrade Drawing, a Non-Extension Drawing, a WestLB Early Termination Drawing,
a WestLB Expiration Drawing or a CNAI Special Termination Drawing) and remain
unreimbursed, (ii) the date on which the entire amount of any Downgrade Drawing,



Non-Extension Drawing, WestLB Early Termination Drawing, WestLB Expiration
Drawing or CNAI Special Termination Drawing shall have become and remain
"Applied Downgrade Advances", "Applied Non-Extension Advances", "Applied WestLB
Early Termination Advances", Applied WestLB Expiration Advances" or "Applied
CNAI Special Termination Advances", as the case may be, under and as defined in
applicable Liquidity Facility and (iii) the date on which all Equipment Notes
shall have been Accelerated (PROVIDED that, with respect to the period prior to
the Delivery Period Expiry Date, such Equipment Notes have an aggregate
outstanding principal balance of in excess of $108,000,000), the Liquidity
Provider with the highest aggregate amount of Liquidity Obligations owed to it
(so long as such Liquidity Provider has not defaulted in its obligation to make
any Drawing under its Liquidity Facility) shall have the right to elect, by
Written Notice to the Subordination Agent and the Trustee, 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 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 Certificates, the Trustee shall separately
      set forth the amounts to be paid in accordance with clause "FIFTH" of
      Section 3.2 or 2.4(b)(i), as the case may be, hereof;

            (ii) 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)(i), as the case may be, hereof; and

            (iii) The Trustee shall set forth the amounts to be paid in
      accordance with clause "SIXTH" 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 Certificates, the Trustee shall separately
      set forth the amounts to be paid in accordance with clause "FIRST" (to
      reimburse payments made by such Trustee or the Certificateholders, as the
      case may be, pursuant to subclause (ii) or (iii) of clause "FIRST" of
      Section 3.3 hereof), clause "SIXTH" (to reimburse payments made by the
      Certificateholders pursuant to subclause (iii) of clause "SIXTH" of
      Section 3.3 hereof) and clause "SEVENTH" of Section 3.3 hereof;

            (ii) 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

            (iii) The Trustee shall set forth the amounts to be paid in
      accordance with clause "SIXTH" of Section 3.3 hereof.

            (c)   At such time as the Trustee or a Liquidity Provider shall have
received all amounts owing to it (and, in the case of the 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 the 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 the 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) on any Business Day shall be
effective on the date delivered (or if delivered later on a Business Day or if
delivered on a day which is not a Business Day 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 2.4(b), 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 "SIXTH" of Section 2.4(b), clauses "FIRST" through "SEVENTH" of
Section 3.2 and clauses "FIRST" through "EIGHTH" 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 the Trustee shall request, but in any event automatically
at the end of each calendar quarter, 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:

            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 pro rata on the basis of the amount
      of the Liquidity Expenses owed to each Liquidity Provider;

            SECOND, such amount as shall be required to pay in full (i) the
      aggregate amount of interest accrued on all Liquidity Obligations (at the
      rate, or in the amount, provided in the applicable Liquidity Facility) and
      unpaid and (ii) if a CNAI Special Termination Drawing has been made under
      the CNAI Liquidity Facility and has not been converted into a Final
      Advance, the outstanding amount of such CNAI Special Termination Drawing,
      shall be distributed to the Liquidity Providers pro rata 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 Sub-Account of
      the Cash Collateral Account had been previously funded as provided in
      Section 3.6(f), to fund the Sub-Account up to its Required Amount shall be
      deposited in such Sub-Account, (B) if any Liquidity Facility shall become
      a Downgraded Facility, a Non-Extended Facility, a WestLB Early Terminated
      Facility or a WestLB Expired Facility at a time when unreimbursed Interest
      Drawings under such Liquidity Facility have reduced the Available Amount
      thereunder to zero, to fund the related Sub-Account of the Cash Collateral
      Account up to an amount equal to such Sub-Account's Required Amount shall
      be deposited in such Sub-Account, and (C) if, with respect to any
      particular Liquidity Facility, neither subclause (A) nor subclause (B) of
      this clause "third" is applicable, to pay or reimburse the Liquidity
      Provider in respect of such Liquidity Facility 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 pro rata on
      the basis of the amounts of such deficiencies in respect of each
      Sub-Account and unreimbursed Liquidity Obligations in respect of each
      Liquidity Provider;

            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) such Liquidity Facility's Required
      Amount, pro rata 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 Certificates on such Distribution Date
      shall be distributed to the Trustee;

            SIXTH, 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
      the Subordination Agent and the Trustee pursuant to the terms of this
      Agreement and the Trust Agreement, as the case may be, shall be
      distributed to the Subordination Agent and the Trustee; and

            SEVENTH, the balance, if any, of any such amount 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. 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 (A) 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 Trust
      Indenture Estate, shall be applied by the Subordination Agent in
      reimbursement of such costs and expenses, (ii) the Trustee for any amounts
      of the nature described in clause (i) above actually incurred by it under
      the Trust Agreement (to the extent not previously reimbursed), shall be
      distributed to the Trustee, and (iii) any Liquidity Provider or any
      Certificateholder for payments, if any, made by it to the Subordination
      Agent or the Trustee in respect of amounts described in clause (i) above,
      shall be distributed to such Liquidity Provider or to the Trustee for the
      account of such Certificateholder and (B) if the Subordination Agent shall
      have requested the initial Appraisals and only so long as a Triggering
      Event shall be continuing, to fund or replenish the Reserve Account up to
      the Reserve Amount, but in no event (other than the initial funding of the
      Reserve Account) more than $25,000 in the aggregate during any calendar
      year, shall be distributed to the Subordination Agent for deposit in the
      Reserve Account, in each such case, pro rata on the basis of all amounts
      described in clauses (A)(i), (A)(ii), (A)(iii) and (B) above;




            SECOND, such amount remaining as shall be required to pay all
      accrued and unpaid Liquidity Expenses shall be distributed to each
      Liquidity Provider pro rata on the basis of the amount of the Liquidity
      Expenses owed to each Liquidity Provider;

            THIRD, such amount remaining as shall be required to pay (i) accrued
      and unpaid interest on the Liquidity Obligations as provided in the
      Liquidity Facilities and (ii) if a CNAI Special Termination Drawing has
      been made under the CNAI Liquidity Facility and has not been converted
      into a Final Advance, the outstanding amount of such CNAI Special
      Termination Drawing, shall be distributed to each Liquidity Provider pro
      rata on the basis of the amount of such accrued and unpaid Liquidity
      Obligations owed to each Liquidity Provider;

            FOURTH, such amount remaining as shall be required (A) if any
      Sub-Account of the 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 the relevant Liquidity Facility, to
      fund such Sub-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
      Sub-Account, (B) if any Liquidity Facility shall become a Downgraded
      Facility, a Non-Extended Facility, a WestLB Early Terminated Facility or a
      WestLB Expired Facility at a time when unreimbursed Interest Drawings
      under such Liquidity Facility have reduced the Available Amount thereunder
      to zero, 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 the related Liquidity Facility, to fund the related
      Sub-Account of the Cash Collateral Account up to an amount equal to such
      Sub-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 Sub-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, pro rata on the basis of the amounts of such deficiencies in
      respect of each Sub-Account and unreimbursed Liquidity Obligations in
      respect of each Liquidity Provider;

            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) such Liquidity Facility's Required
      Amount (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), pro rata 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) the Trustee for any Tax (other than Taxes imposed on
      compensation paid under the Trust Agreement), expense, fee, charge, loss
      or any other amount payable to the Trustee under the Trust Agreement (to
      the extent not previously reimbursed), shall be distributed to the
      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 Trustee for the account of such
      Certificateholder, in each such case, pro rata 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
      Triggering Event Distributions on the Certificates shall be distributed to
      the Trustee; and

            EIGHTH, the balance, if any, of any such amount remaining thereafter
      shall be held in the Collection Account for later distribution in
      accordance with this Article III.

            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 Triggering Event Distributions have
been made in full, in the manner provided in clause "first" of Section 3.3
hereof.

            (b)   Notwithstanding the priority of payments specified in Sections
2.4(b)(i), 3.2 and 3.3, in the event any Investment Earnings on amounts on
deposit in the Cash Collateral Account resulting from an Unapplied Provider
Advance are deposited in the Collection Account or the Special Payments Account,
such Investment Earnings shall be used to pay interest payable in respect of
such Unapplied Provider Advance to the extent of such Investment Earnings.

            (c)   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(c) only, each reference in
clause "SIXTH" 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" of Section 3.2 to "Distribution Date" shall be deemed to refer to such
Scheduled Payment Date.

            SECTION 3.5 PAYMENTS TO THE TRUSTEE 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 at the time of such transfer. Any amounts distributed hereunder by the



Subordination Agent to the Trustee, if the Trustee shall not be the same
institution as the Subordination Agent, shall be paid to the Trustee by wire
transfer of funds at the address the 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
Certificates (at the Stated Interest Rate), then, prior to 1:00 p.m. (New York
City time) on such Distribution Date, the Subordination Agent shall request a
drawing (each such drawing, an "INTEREST DRAWING") under each Liquidity Facility
in an amount equal to the lesser of (i) Pro Rata Portion with respect to such
Liquidity Facility of an amount sufficient to pay the amount of such accrued
interest (at the Stated Interest Rate) and (ii) the Available Amount under such
Liquidity Facility, and shall pay such amount to the Trustee in payment of such
accrued interest.

            (b)   APPLICATION OF INTEREST DRAWINGS. Notwithstanding anything to
the contrary contained in this Agreement, all payments received by the
Subordination Agent in respect of an Interest Drawing under the Liquidity
Facilities and all amounts withdrawn by the Subordination Agent from the Cash
Collateral Account, and payable in each case to the Certificateholders or the
Trustee, shall be promptly distributed to the Trustee.

            (c)   DOWNGRADE DRAWINGS. (i) With respect to each Liquidity
Facility, a Downgrade Drawing shall be requested by the Subordination Agent
thereunder as provided in Section 3.6(c)(iii), if at any time, a Downgrade Event
shall have occurred with respect to such Liquidity Facility (a "DOWNGRADED
FACILITY"), unless an event described in Section 3.6(c)(ii) occurs with respect
to such Liquidity Facility.

            (ii)  If at any time any Liquidity Facility becomes a Downgraded
Facility, the Subordination Agent shall request a Downgrade Drawing thereunder
in accordance with Section 3.6(c)(iii), unless such Liquidity Provider or
Continental arranges for a Replacement Liquidity Provider to issue and deliver a
Replacement Liquidity Facility to the Subordination Agent within 10 days after
receiving notice of a Downgrade Event (but not later than the expiration date of
such Downgraded Facility).

            (iii) Upon the occurrence of any Downgrade Event with respect to any
Liquidity Facility, unless any event described in Section 3.6(c)(ii) occurs with
respect thereto, the Subordination Agent shall, on the 10th day referred to in
Section 3.6(c)(ii) (or if such 10th day is not a Business Day, on the next
succeeding Business Day) (or, if earlier, the expiration date of the Downgraded
Facility), request a drawing in accordance with and to the extent permitted by
the Downgraded Facility (such drawing, a "DOWNGRADE DRAWING") of the Available
Amount thereunder. Amounts drawn pursuant to a Downgrade Drawing shall be
maintained and invested as provided in Section 3.6(f) hereof. Any Liquidity
Provider whose Liquidity Facility has become a Downgraded Facility subject to a
Downgrade Event 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
such Liquidity Provider.




            (d)(i)   NON-EXTENSION DRAWINGS. If any Liquidity Facility, other
than the initial WestLB Liquidity Facility, is scheduled to expire on a date
(the "STATED EXPIRATION DATE") prior to the date that is 15 days after the Final
Legal Distribution Date, then, no earlier than the 60th day and no later than
the 40th day prior to the applicable Stated Expiration Date then in effect, the
Subordination Agent shall request that the relevant Liquidity Provider extend
the Stated Expiration Date until the earlier of (i) the date which is 15 days
after such Final Legal Distribution Date and (ii) the date that is the day
immediately preceding the 364th day occurring after the last day of the
applicable Consent Period (unless the obligations of such Liquidity Provider
under such Liquidity Facility are earlier terminated in accordance with such
Liquidity Facility). Whether or not such Liquidity Provider has received a
request from the Subordination Agent, such Liquidity Provider shall advise the
Subordination Agent, no earlier than the 40th day (or, if earlier, the date of
such Liquidity Provider's receipt of such request, if any, from the
Subordination Agent) and no later than the 25th day prior to the Stated
Expiration Date then in effect for such Liquidity Facility (such period, the
"CONSENT PERIOD"), whether, in its sole discretion, it agrees to extend such
Stated Expiration Date. If (A) on or before the date on which such Consent
Period ends, such Liquidity Facility shall not have been replaced in accordance
with Section 3.6(e) and (B) such Liquidity Provider fails irrevocably and
unconditionally to advise the Borrower on or before the date on which such
Consent Period ends that such Stated Expiration Date then in effect shall be so
extended, the Subordination Agent shall, on the date on which such Consent
Period ends (or as soon as possible thereafter), in accordance with the terms of
such 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. If any amounts shall be drawn pursuant to a Non-Extension
Drawing and, within 30 days thereafter, the related Liquidity Provider shall not
have been replaced, then at any time following the 30th day after such
Non-Extension Drawing, such Liquidity Provider may, by written notice to the
Subordination Agent, agree to reinstate its Liquidity Facility on the terms of
its existing Liquidity Facility for a period ending on the 364th day after the
end of the Consent Period; PROVIDED, HOWEVER, that in such event such Liquidity
Provider shall reimburse the Subordination Agent and Continental for any costs
actually incurred by or on behalf of the Subordination Agent or Continental, as
the case may be, in drawing pursuant to the Non-Extension Drawing and funding
the related Sub-Account of the Cash Collateral Account or otherwise in
connection with the Non-Extension Drawing.

            (ii)  WESTLB EARLY TERMINATION DRAWINGS. WestLB shall have the right
in its sole discretion to terminate the WestLB Liquidity Facility at any time
during the period from the 40th day to and including the 25th day prior to each
anniversary of the Closing Date (the "WESTLB EARLY TERMINATION NOTICE PERIOD")
upon not less than 25 days' written notice (the "WESTLB EARLY TERMINATION
NOTICE") to the Subordination Agent. If WestLB delivers a WestLB Early
Termination Notice to the Subordination Agent during the WestLB Early
Termination Notice Period (and, in each case, if WestLB shall not have been
replaced in accordance with Section 3.6(e) on or before the expiry of the WestLB
Early Termination Notice Period), the Subordination Agent shall as soon as
possible after receipt of such WestLB Early Termination Notice but prior to the
WestLB Early Termination Date, in accordance with and to the extent permitted by
the terms of the terminating WestLB Liquidity Facility (an "WESTLB EARLY



TERMINATED FACILITY"), request a drawing under the WestLB Early Terminated
Facility of all available and undrawn amounts thereunder (such drawing, a
"WESTLB EARLY TERMINATION DRAWING"). Amounts drawn pursuant to a WestLB Early
Termination Drawing shall be maintained and invested in accordance with Section
3.6(f).

            (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 any Liquidity Facility (including any
Replacement Liquidity Facility provided pursuant to Section 3.6(e)(ii) hereof).
If such Replacement Liquidity Facility is provided at any time after a Downgrade
Drawing, Non-Extension Drawing, WestLB Early Termination Drawing, WestLB
Expiration Drawing or CNAI Special Termination Drawing has been made, all funds
on deposit in the relevant Sub-Account of the Cash Collateral Account will be
returned to the Liquidity Provider being replaced.

            (ii)(A)  If a Liquidity Provider (other than WestLB) shall
determine not to extend its Liquidity Facility in accordance with Section
3.6(d)(i), 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. In addition, at any time after a Non-Extension
Drawing has been made under such Liquidity Facility, such Liquidity Provider
may, at its option, arrange for a Replacement Liquidity Facility to replace such
Liquidity Facility; PROVIDED, HOWEVER, that if such Liquidity Provider has
extended the Stated Expiration Date as described above, it shall not have the
right to replace such Liquidity Facility prior to the first anniversary of the
Closing Date.

            (B) If WestLB shall terminate its Liquidity Facility early in
accordance with Section 3.6(d)(ii), then WestLB may, at its option, arrange for
a Replacement Liquidity Facility to replace such Liquidity Facility prior to the
WestLB Early Termination Date.

            (iii) No Replacement Liquidity Facility arranged by Continental or a
Liquidity Provider in accordance with clause (i) or (ii) above or pursuant to
Section 3.6(c), respectively, shall become effective and no such Replacement
Liquidity Facility shall be deemed a "Liquidity Facility" under the Operative
Agreements, unless and until (A) each of the conditions referred to in sub
clauses (iv)(x) and (z) below shall have been satisfied, (B) if such Replacement
Liquidity Facility shall materially adversely affect the rights, remedies,
interests or obligations of the 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) or pursuant to Section 3.6(c), such Replacement Liquidity
Facility is acceptable to Continental.

            (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
any rating then in effect for the 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 relevant Sub-Account of the Cash Collateral Account as
described in clause (iii) 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) with respect to a Replacement Liquidity
Facility, (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 and (2) the replacement of the applicable Liquidity Facility with the
applicable Replacement Liquidity Facility and (z) such 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 such Replacement Liquidity Facility shall be deemed to be a
Liquidity Facility hereunder and under the other Operative Agreements.

            (f)   CASH COLLATERAL ACCOUNT; WITHDRAWALS; INVESTMENTS. In the
event the Subordination Agent shall draw all available amounts under any
Liquidity Facility pursuant to Section 3.6(c), 3.6(d), 3.6(i), 3.6(k) or 3.6(l)
hereof, or in the event amounts are to be deposited in a Sub-Account of the Cash
Collateral Account pursuant to subclause (A) or (B) of clause "THIRD" of Section
2.4(b)(i), subclause (A) or (B) of clause "THIRD" of Section 3.2 or subclause
(A) or (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 relevant Sub-Account of the Cash Collateral Account. All amounts on deposit
in any such Sub-Account of the Cash Collateral Account shall be invested and
reinvested in Eligible Investments in accordance with Section 2.2(b) hereof. On
each Interest Payment Date (or, in the case of any Special Distribution Date
with respect to a distribution pursuant to Section 2.4(b) hereof occurring prior
to the occurrence of a Triggering Event, on such Special Distribution Date),
Investment Earnings on amounts on deposit in each Sub-Account of the Cash
Collateral Account (or, in the case of any Special Distribution Date with
respect to a distribution pursuant to Section 2.4(b) hereof occurring prior to
the occurrence of a Triggering Event, a fraction of such Investment Earnings
equal to the Section 2.4(b) Fraction) shall be deposited in the Collection
Account (or, in the case of any Special Distribution Date with respect to a
distribution pursuant to Section 2.4(b) hereof occurring prior to the occurrence
of a Triggering Event, the Special Payments Account) and applied on such
Interest Payment Date (or Special Distribution Date, as the case may be) in
accordance with Section 2.4, 3.2, 3.3 or 3.4 (as applicable). The Subordination
Agent shall deliver a written statement to Continental and each relevant
Liquidity Provider one day prior to each Interest Payment Date and Special
Distribution Date setting forth the aggregate amount of Investment Earnings held



in the applicable Sub-Account of the Cash Collateral Account as of such date. In
addition, from and after the date funds are so deposited with respect to any
Liquidity Facility, 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 Certificates (at the Stated Interest Rate) from any
      other source, withdraw from the Sub-Account of the Cash Collateral Account
      with respect to such Liquidity Facility, and pay to the Trustee, an amount
      equal to the lesser of (x) the Pro Rata Portion with respect to such
      Sub-Account of an amount necessary to pay accrued and unpaid interest (at
      the Stated Interest Rate) on the Certificates and (y) the amount on
      deposit in such Sub-Account;

            (ii) on each date on which the Pool Balance of the Trust shall have
      been reduced by payments made to the Certificateholders pursuant to
      Section 2.4, 3.2 or 3.3 hereof or pursuant to Section 2.03 of the Escrow
      and Paying Agent Agreement or deemed reduced pursuant to the proviso in
      the definition of "Required Amount", the Subordination Agent shall
      withdraw from such Sub-Account of the Cash Collateral Account such amount
      as is necessary so that, after giving effect to the reduction or deemed
      reduction of the Pool Balance on such date (and any reduction in the
      amounts on deposit in such Sub-Account resulting from a prior withdrawal
      of amounts on deposit in such Sub-Account on such date) and any transfer
      of Investment Earnings from such Sub-Account to the Collection Account or
      the Special Payments Account on such date, an amount equal to the sum of
      the Required Amount (with respect to the relevant Liquidity Facility) plus
      Investment Earnings on deposit in such Sub-Account (after giving effect to
      any such transfer of Investment Earnings) will be on deposit in such
      Sub-Account and shall FIRST, pay such withdrawn amount to the relevant
      Liquidity Provider until the Liquidity Obligations owing to such Liquidity
      Provider shall have been paid in full, and SECOND, deposit any remaining
      withdrawn amount in the Collection Account;

            (iii) if a Replacement Liquidity Facility for the Certificates shall
      be delivered to the Subordination Agent following the date on which funds
      have been deposited into such Sub-Account with respect to such Liquidity
      Facility of the Cash Collateral Account, the Subordination Agent shall
      withdraw all amounts on deposit in such Sub-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

            (iv) following the payment of Triggering Event Distributions in
      full, on the date on which the Subordination Agent shall have been
      notified by the applicable Liquidity Provider that the Liquidity
      Obligations owed to such Liquidity Provider have been paid in full, the
      Subordination Agent shall withdraw all amounts on deposit in such
      Sub-Account to the Cash Collateral Account and shall deposit such amount
      in the Collection Account.




            (g)   REINSTATEMENT. With respect to any Interest Drawing under any
      Liquidity Facility, upon the reimbursement of the applicable Liquidity
      Provider in full or in 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 such 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 with respect to such Liquidity Facility shall
      have occurred and be continuing or (y) a Final Drawing, Downgrade Drawing,
      Non-Extension Drawing, WestLB Early Termination Drawing, WestLB Expiration
      Drawing or CNAI Special Termination Drawing shall have occurred with
      respect to such Liquidity Facility. In the event that (i) funds are
      withdrawn from a Sub-Account pursuant to clause (i), (ii) or (iii) of
      Section 3.6(f) hereof or (ii) a Liquidity Facility shall become a
      Downgraded Facility, a Non-Extended Facility, a WestLB Early Terminated
      Facility or a WestLB Expired Facility at a time when unreimbursed Interest
      Drawings under such Liquidity Facility have reduced the Available Amount
      thereunder to zero, then funds received by the Subordination Agent at any
      time other than (x) any time when a Liquidity Event of Default with
      respect to such Liquidity Facility shall have occurred and be continuing
      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 the such Sub-Account as and to the extent provided in
      clause "THIRD" of Section 2.4(b)(i), 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 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. On the first Regular Distribution
Date, the Stated Amount under each Liquidity Facility shall automatically be
reduced to the Required Amount then in effect with respect to such Liquidity
Facility. On each date on which the Pool Balance of the Trust shall have been
reduced by payments made to the Certificateholders pursuant to Section 2.4, 3.2
or 3.3 hereof or pursuant to Section 2.03 of the Escrow and Paying Agent
Agreement or deemed reduced pursuant to the proviso in the definition of
"Required Amount", the Stated Amount under each Liquidity Facility shall
automatically be reduced to an amount equal to the Required Amount for such
Liquidity Facility (as calculated by the Subordination Agent after giving effect
to such payment).

            (k)   CNAI SPECIAL TERMINATION DRAWING. Upon receipt from a
Liquidity Provider of a CNAI Special Termination Notice with respect to any



Liquidity Facility, the Subordination Agent shall, not later than the date
specified in such CNAI Special Termination Notice, in accordance with the terms
of such Liquidity Facility, request a drawing under such Liquidity Facility of
all available and undrawn amounts thereunder (a "CNAI SPECIAL TERMINATION
DRAWING"). Amounts drawn pursuant to a CNAI Special Termination Drawing shall be
maintained and invested in accordance with Section 3.6(f) hereof.

            (l)   WESTLB EXPIRATION DRAWING. If on December 1, 2015, the
Available Amount under the WestLB Liquidity Facility is greater than zero, the
Subordination Agent shall request a drawing under such Liquidity Facility prior
to the Expiry Date of such Liquidity Facility of all available and undrawn
amounts thereunder (such drawing, a "WESTLB EXPIRATION DRAWING"; such Liquidity
Facility, a "WESTLB EXPIRED FACILITY"). Amounts drawn pursuant to a WestLB
Expiration Drawing shall be maintained and invested in accordance with Section
3.6(f) hereof.

            (m)   RELATION TO SUBORDINATION PROVISIONS. Interest Drawings under
the Liquidity Facilities and withdrawals from any Sub-Account of the Cash
Collateral Account, in each case, in respect of interest on the Certificates,
will be distributed to the Trustee, notwithstanding Sections 2.4, 3.2 and 3.3
hereof.

            (n)   ASSIGNMENT OF LIQUIDITY FACILITY. The Subordination Agent
agrees not to consent to the assignment by any Liquidity Provider of any of its
rights or obligations under the relevant Liquidity Facility or any interest
therein, unless (i) Continental shall have consented to such assignment and (ii)
each Rating Agency shall have provided a Ratings Confirmation in respect of such
assignment; PROVIDED, that the Subordination Agent shall consent to such
assignment if the conditions in the foregoing clauses (i) and (ii) are
satisfied, and the foregoing is not intended to and shall not be construed to
limit the rights of any Liquidity Provider under Section 3.6(e)(ii).

                                   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 Loan Trustee 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
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 direct the Subordination
Agent to sell, assign, contract to sell or otherwise dispose of and deliver all
(but not less than all) of such Equipment Notes, or sell the Aircraft subject to
the Lien of such Indenture, in either case, 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)  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 Appraisals with respect
to the Aircraft subject to such Indenture.

            (iii) After a Triggering Event occurs and any Equipment Note becomes
a Non-Performing Equipment Note, the Subordination Agent shall obtain a desktop
appraisal from each of three Appraisers setting forth the current market value,
current lease rate and immediate or distress sale value (in each case, as
defined by the International Society of Transport Aircraft Trading) with respect
to all of the Aircraft (the "APPRAISALS") as soon as practicable and thereafter
during the continuance of such Triggering Event additional Appraisals on or
prior to each six-month anniversary of the date of such initial Appraisals;
PROVIDED, that, the Controlling Party shall have the right to obtain or cause to
be obtained additional Appraisals (including any Appraisals based upon physical
inspection of the Aircraft) at any time.

            (iv)  After the Subordination Agent has requested the Appraisers to
deliver the initial Appraisals, the Reserve Account will be funded initially up
to the Reserve Amount from amounts distributed under clause "first" of Section
3.3 hereof. The Subordination Agent shall have the right to withdraw funds from
the Reserve Account to pay for the initial and any subsequent Appraisals. The
Reserve Account will subsequently be replenished up to the Reserve Amount
pursuant to clause first of Section 3.3 hereof; provided, that, except for the
initial funding of the Reserve Account up to the Reserve Amount, no more than
$25,000 will be deposited in the Reserve Account in any calendar year and no
more than $100,000 shall be on deposit in the Reserve Account at any time. On
the first Business Day following the earliest of (w) the first day after the
initial funding of the Reserve Account on which no Triggering Event exists, (x)
the Final Legal Distribution Date, (y) the date of the disposition of the last
Aircraft or the related Equipment Note hereunder, and (z) the date on which
payment of the Triggering Event Distributions is made in full, the Subordination
Agent shall withdraw all amounts (if any) on deposit in the Reserve Account and
deposit such amounts in the Collection Account.

            (b)   Following the occurrence and during the continuance of an
Indenture Default under any Indenture, the Controlling Party shall take such
actions as it may reasonably deem most effectual to complete the sale or other
disposition of the relevant 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 Loan Trustee under such Indenture to foreclose on the Lien on the
related Aircraft.

            SECTION 4.2 REMEDIES CUMULATIVE. Each and every right, power and
remedy given to the Trustee, 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 the 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 the 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 the Trust Agreement, the right of any Certificateholder or any
Liquidity Provider, respectively, to receive payments hereunder (including,
without limitation, 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 the Trustee or a suit by Certificateholders holding more
than 10% of the original principal amount of the Certificates.




                                    ARTICLE V

                       DUTIES OF THE SUBORDINATION AGENT;
                           AGREEMENTS OF TRUSTEE, 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 Trustee 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 the Trustee, one or more Liquidity Providers or one or
more Certificateholders.

            (b)   OTHER NOTICES. The Subordination Agent will furnish to each
Liquidity Provider and the 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.

            (c)   Upon the occurrence of an Indenture Default, the Subordination
Agent shall instruct the Trustee to, and the Trustee shall, request that DTC
post on its internet bulletin board a securities position listing setting forth
the names of all the parties reflected on DTC's books as holding interests in
the certificates.

            (d)   REPORTS. Promptly after the occurrence of a Triggering Event
or an Indenture Default resulting from the failure of Continental to make
payments on any Equipment Note and on every sixth Regular Distribution Date
while the Triggering Event or such Indenture Default shall be continuing, the
Subordination Agent will provide to the Pass Through Trustee, Liquidity
Providers, Rating Agencies and Continental a statement setting forth the
following information:

            (i) after a bankruptcy of Continental, with respect to each
 Aircraft, whether such Aircraft is (A) subject to the 60-day period of Section
 1110 of the Bankruptcy Code, (B) subject to an election by Continental under
 Section 1110(a) of the Bankruptcy Code, (C) covered by an agreement
 contemplated by Section 1110(b) of the Bankruptcy Code or (D) not subject to
 any of (A), (B) or (C);

            (ii) to the best of the Subordination Agent's knowledge, after
 requesting such information from Continental, (A) whether the Aircraft are
 currently in service or parked in storage, (B) the maintenance status of the
 Aircraft and (C) the location of the Engines (as defined in the Indentures);




            (iii) the current Pool Balance of the Certificates and outstanding
principal amount of all Equipment Notes;

            (iv) the expected amount of interest which will have accrued on the
Equipment Notes and on the Certificates as of the next Regular Distribution
Date;

            (v) the amounts paid to each person on such Distribution Date
pursuant to this Agreement;

            (vi) details of the amounts paid on such Distribution Date
identified by reference to the relevant provision of this Agreement and the
source of payment (by Aircraft and party);

            (vii) if the Subordination Agent has made a Final Drawing under any
Liquidity Facility;

            (viii) the amounts currently owed to each Liquidity Provider;

            (ix) the amounts drawn under each Liquidity Facility; and

            (x) after a bankruptcy of Continental, any operational reports filed
by Continental with the bankruptcy court which are available to the
Subordination Agent on a non-confidential basis.

            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 its own cost and expense (but without any right of
indemnity in respect of any such cost or expense under Section 5.2 or 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 TRUSTEE. If any
Liquidity Provider or the Trustee has notice of an Indenture Default or a
Triggering Event, such Person shall promptly give notice thereof to the Trustee
or the other Liquidity Provider, as the case may be, 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. The
Trustee hereby designates and appoints the Subordination Agent as the agent and
trustee of the Trustee under each Liquidity Facility and authorizes the
Subordination Agent to enter into each Liquidity Facility as agent and trustee
for such Trustee. Each of the Liquidity Providers and the Trustee 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 Sections 2.2 or 5.3 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 Trustee and the Liquidity Providers make no
representation or warranty hereunder whatsoever.

            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 the 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 as of any date, the Subordination Agent may for all purposes hereof rely
on a certificate signed by any Responsible Officer of the 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 Trustee 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 the Trustee 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 any of the Liquidity Providers or the
Trustee 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 the
Trustee or any of the Liquidity Providers for any fee as compensation for its
services as agent 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 and Section 6 of the Note Purchase
Agreement. The indemnities contained in such Sections of such agreements shall
survive the termination of this Agreement.




                                  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
Trustee and the Liquidity Providers. The Controlling Party may remove the
Subordination Agent for cause by so notifying the Subordination Agent and may
appoint a successor Subordination Agent. The Controlling Party 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 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 Trustee. 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 the Trustee 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), the Trustee or one or more of the Liquidity
Providers may petition any court of competent jurisdiction for the 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 the Trustee (acting,
except in the case of any amendment pursuant to Section 3.6(e)(v)(y) hereof with
respect to any Replacement Liquidity Facility or any amendment contemplated by
the last sentence of this Section 9.1(a), with the consent of holders of the
Certificates evidencing interests in the Trust aggregating not less than a
majority in interest in the Trust or as otherwise authorized pursuant to the
Trust Agreement), the Subordination Agent and each Liquidity Provider; PROVIDED,
HOWEVER, that this Agreement may be supplemented, amended or modified without
the consent of the Trustee if such supplement, amendment or modification cures
an ambiguity or inconsistency or does not materially adversely affect the
Trustee, the Liquidity Providers or the holders of the Certificates; PROVIDED
FURTHER, HOWEVER, that, if such supplement, amendment or modification (A) would
(x) directly or indirectly modify or supersede, or otherwise conflict with,
Section 2.2(b), the proviso to the last sentence of Section 3.6(d)(i), Section
3.6(e), Section 3.6(f) (other than the last sentence thereof), Section 3.6(n),
the last sentence of this Section 9.1(a), the second sentence of Section 10.6 or
this proviso (collectively, 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 Operative Agreement or (B) is
made pursuant to the last sentence of this Section 9.1(a), 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
the Trust evidenced by the Certificates issued by the Trust necessary to consent
to modify or amend any provision of this Agreement or to waive compliance
therewith or (ii) except as provided in the last sentence of this Section
9.1(a), 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 the Trustee at any time following the payment of
Triggering Event Distributions in full. If any Replacement Liquidity Facility in
accordance with Section 3.6(e) hereof is to be comprised of more than one
instrument or an instrument other than a revolving credit agreement, in each
case, 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 or for such
instrument, as the case may be.

            (b)   In the event that the Subordination Agent, as the registered
holder of any Equipment Notes, receives a request for its consent to any
amendment, modification, consent 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 such Equipment
Notes from the Trustee and shall vote or consent in accordance with the
directions of the 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.

            Upon the reasonable request of any Rating Agency in writing, the
Subordination Agent and Trustee shall provide to such Rating Agency such
information available to the Subordination Agent and the Trustee as may be
relevant to maintaining such Rating Agency's rating on the Certificates. During
the continuance of a Triggering Event or an Indenture Default resulting from a
payment default under any Equipment Note, the Subordination Agent and Trustee
shall permit each Rating Agency, upon reasonable notice and on a periodic basis,
to be provided copies of documents in the possession of the Subordination Agent
and Trustee in their respective capacities as such reasonably related to the
transactions contemplated by the Operative Agreements and, on a reasonable
periodic basis, to meet or confer with officers and employees of the
Subordination Agent and Trustee in their respective capacities as such to
discuss such transactions, so long as such actions are reasonably related to
maintaining such Rating Agency's rating on the Certificates.




                                    ARTICLE X

                                  MISCELLANEOUS

            SECTION 10.1 TERMINATION OF INTERCREDITOR AGREEMENT. Following
payment in full of Triggering Event Distributions 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 Trustee, the
Liquidity Providers and the Subordination Agent hereunder or under the Trust
Agreement, and that the commitment of the Liquidity Providers under the
Liquidity Facilities shall have expired or been 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 THE TRUSTEE, THE
LIQUIDITY PROVIDERS AND THE 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 Trustee, 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 Administration
                  Telecopy:  (302) 651-8882

            (ii)  if to the 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 Administration
                  Telecopy:  (302) 651-8882

            (iii) if to CNAI, addressed to it at its office at:

                  Citicorp North America, Inc.



                  2 Penns Way, Suite 200
                  New Castle, DE 19720
                  Reference:  Continental Airlines Pass Through Trust
                  2004-ERJ1
                  Attention: Craig Thorpe
                  Telephone: (302) 894-6058
                  Telecopy: (212) 994-0847

            with a copy to:

                  CITIBANK, N.A. Global Aviation
                  388 Greenwich Street
                  23rd Floor
                  New York, NY 10013
                  Attention:  Gaylord Holmes
                  Telephone:  (212) 816-5138
                  Telecopy:    (212) 816-5705

                  and

                  Citicorp
                  Treasury Department
                  153 East 53rd Street, 6th Floor
                  New York, NY 10043
                  Reference: Continental Airlines Pass Through Trust 2004-ERJ1
                  Attention: Gregory C. Ehlke, Vice President
                  Telephone: (212) 559-0302
                  Telecopy: (212) 793-4776

            (iv)  if to WestLB, addressed to it at its office at:

                  1211 Avenue of the Americas
                  New York, New York 10036
                  Reference: Continental Airlines Pass Through Trust 2004-ERJ1
                  Attention: Brigitte Thieme
                  Telephone: (212) 852-6111
                  Telecopy: (212) 869-7634

            with a copy to:

                  WestLB AG, New York Branch
                  1211 Avenue of the Americas
                  New York, New York 10036
                  Attention:  Michael Sassos
                  Telephone: (212) 852-5973
                  Telecopy:  (212) 852-6228




                  and

                  WestLB AG, New York Branch
                  1211 Avenue of the Americas
                  New York, New York 10036
                  Attention:  Jesus Sang
                  Telephone:  (212) 852-6389
                  Telecopy:   (212) 302-7946



Whenever any notice in writing is required to be given by the Trustee, any
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 Trustee and the Certificateholders, on the other hand,
and as among the Trustee and the Certificateholders, 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 the 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 Trustee (on behalf of itself 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 Trustee
and the holders of Certificates are secured by certain assets and the Liquidity
Obligations may not be so secured. The Trustee expressly agrees (on behalf of
itself 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 Trustee (on behalf of itself and the holders of
the 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

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

            (c)   Each Liquidity Provider not organized under the laws of the
United States or any political subdivision thereof 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 judgment entered by any such court
under the United States Foreign Sovereign Immunities Act of 1976 or any similar
successor legislation.






            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


                                       By
                                         ---------------------------------------
                                         Name:
                                         Title:



                                       WESTLB AG, acting through its New
                                           York Branch, as Liquidity
                                           Provider


                                       By
                                         ---------------------------------------
                                         Name:
                                         Title:


                                       By
                                         ---------------------------------------
                                         Name:
                                         Title:



                                       CITICORP NORTH AMERICA, INC., as
                                           Liquidity Provider


                                       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:









                                DEPOSIT AGREEMENT


                            Dated as of June 29, 2004


                                     between


               WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION

                                 as Escrow Agent


                                       and


                                   WESTLB AG,
                                 New York Branch

                                  as Depositary









                                TABLE OF CONTENTS

                                                                            PAGE

SECTION 1.1  Acceptance of Depositary........................................2

SECTION 1.2  Establishment of Accounts.......................................2

SECTION 2.1  Deposits........................................................2

SECTION 2.2  Interest........................................................2

SECTION 2.3  Withdrawals.....................................................3

SECTION 2.4  Other Accounts..................................................3

SECTION 3.  Termination......................................................4

SECTION 4.  Payments.........................................................4

SECTION 5.  Representation and Warranties....................................5

SECTION 6.  Transfer.........................................................6

SECTION 7.  Amendment, Etc. .................................................6

SECTION 8.  Notices..........................................................6

SECTION 9.  Obligations Unconditional........................................7

SECTION 10.  Entire Agreement................................................7

SECTION 11.  Governing Law...................................................7

SECTION 12.  Waiver of Jury Trial Right......................................7

SECTION 13.  Counterparts....................................................7



            DEPOSIT AGREEMENT dated as of June 29, 2004 (as amended, modified or
supplemented from time to time, this "AGREEMENT") between WELLS FARGO BANK
NORTHWEST, NATIONAL ASSOCIATION, a national banking association, as Escrow Agent
under the Escrow and Paying Agent Agreement referred to below (in such capacity,
together with its successors in such capacity, the "ESCROW AGENT"), and WESTLB
AG, a joint stock company ("Aktiengesellschaft") organized under the laws of
Germany, acting through its New York Branch, as depositary bank (the
"DEPOSITARY").

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

            WHEREAS, Continental Airlines, Inc. ("CONTINENTAL") and Wilmington
Trust Company, not in its individual capacity except as otherwise expressly
provided therein, but solely as trustee (in such capacity, together with its
successors in such capacity, the "PASS THROUGH TRUSTEE") have entered into a
Trust Supplement, dated as of June 29, 2004, to the Pass Through Trust Agreement
dated as of September 25, 1997 (together, as amended, modified or supplemented
from time to time in accordance with the terms thereof, the "PASS THROUGH TRUST
AGREEMENT") relating to Continental Airlines Pass Through Trust 2004-ERJ1
pursuant to which the Continental Airlines Pass Through Trust, Series 2004-ERJ1
Certificates referred to therein (the "CERTIFICATES") are being issued (the date
of such issuance, the "ISSUANCE DATE");

            WHEREAS, Continental, and Citigroup Global Markets Inc. and Morgan
Stanley & Co. Incorporated (collectively, the "UNDERWRITERS" and, together with
their respective transferees and assigns as registered owners of the
Certificates, the "INVESTORS") and the Depositary have entered into an
Underwriting Agreement dated as of June 18, 2004, pursuant to which the Pass
Through Trustee will issue and sell the Certificates to the Underwriters;

            WHEREAS, Continental, the Pass Through Trustee, and certain other
persons concurrently herewith are entering into the Note Purchase Agreement,
dated as of the date hereof (the "NOTE PURCHASE AGREEMENT"), pursuant to which
the Pass Through Trustee has agreed to acquire from time to time on or prior to
the Delivery Period Termination Date (as defined in the Note Purchase Agreement)
equipment notes (the "EQUIPMENT NOTES") issued to finance the acquisition of
aircraft by Continental, as lessee, utilizing a portion of the proceeds from the
sale of the Certificates (the "NET PROCEEDS");

            WHEREAS, the Escrow Agent, the Underwriters, the Pass Through
Trustee and Wilmington Trust Company, as paying agent for the Escrow Agent (in
such capacity, together with its successors in such capacity, the "PAYING
AGENT") concurrently herewith are entering into an Escrow and Paying Agent
Agreement, dated as of the date hereof (as amended, modified or supplemented
from time to time in accordance with the terms thereof, the "ESCROW AND PAYING
AGENT AGREEMENT"); and

            WHEREAS, the Underwriters and the Pass Through Trustee intend that
the Net Proceeds (excluding any amount used to purchase Equipment Notes on the
Issuance Date) be held in escrow by the Escrow Agent on behalf of the Investors
pursuant to the Escrow and Paying Agent Agreement, subject to withdrawal upon
request of and proper certification by the Pass Through Trustee for the purpose
of purchasing Equipment Notes, and that pending such withdrawal the Net Proceeds



be deposited by the Escrow Agent with the Depositary pursuant to this Agreement,
which provides for the Depositary to pay interest for distribution to the
Investors and to establish accounts from which the Escrow Agent shall make
withdrawals upon request of and proper certification by the Pass Through
Trustee.

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

            SECTION 1.1 ACCEPTANCE OF DEPOSITARY. The Depositary hereby agrees
to act as depositary bank as provided herein and in connection therewith to
accept all amounts to be delivered to or held by the Depositary pursuant to the
terms of this Agreement. The Depositary further agrees to hold, maintain and
safeguard the Deposits and the Accounts (as defined below) during the term of
this Agreement in accordance with the provisions of this Agreement. The Escrow
Agent shall not have any right to withdraw, assign or otherwise transfer moneys
held in the Accounts except as permitted by this Agreement.

            SECTION 1.2 ESTABLISHMENT OF ACCOUNTS. The Escrow Agent hereby
instructs the Depositary, and the Depositary agrees, to establish the separate
deposit accounts listed on Schedule I hereto and to establish such additional
separate deposit accounts as may be required, solely upon the written
instruction of an Authorized Person (as defined in Section 8 hereof) of the
Escrow Agent, in connection with the deposits contemplated by Section 2.4 hereof
(each, an "ACCOUNT" and collectively, the "ACCOUNTS"), each in the name of the
Escrow Agent and all on the terms and conditions set forth in this Agreement.

            SECTION 2.1 DEPOSITS. The Escrow Agent shall direct the Underwriters
to deposit with the Depositary on the date of this Agreement (the "DEPOSIT
DATE") in Federal (same day) funds by wire transfer to: WESTLB AG, acting
through its New York Branch, Reference: 2004-ERJ1 Pass Through Trust, and the
Depositary shall accept from the Underwriters, on behalf of the Escrow Agent,
the sum of US$173,629,000 (or such lesser amount equal to the Net Proceeds less
amounts, if any, used to purchase Equipment Notes on the Issuance Date). Upon
acceptance of such sum, the Depositary shall (i) accept each of the deposits
specified in Schedule I hereto maturing on April 29, 2005 (including any deposit
made pursuant to Section 2.4 hereof, individually, a "DEPOSIT" and,
collectively, the "DEPOSITS") and (ii) credit each Deposit to the related
Account as set forth therein. No amount shall be deposited in any Account other
than the related Deposit. The Depositary shall have no duty to solicit the
delivery of any Deposit.

            SECTION 2.2 INTEREST. The Depository shall pay interest on each
Deposit from and including the date of deposit to but excluding the date of
withdrawal at the rate of 9.558% per annum (computed on the basis of a year of
twelve 30 day months) payable to the Paying Agent, in accordance with the
instructions set forth in Section 4 hereof, on behalf of the Escrow Agent
monthly in arrears on the 1st day of each month, commencing on August 1, 2004
(each, an "Interest Payment Date"), and on the date of the Final Withdrawal (as
defined below), all in accordance with the terms of this Agreement (whether or
not any such Deposit is withdrawn on an Interest Payment Date). Interest accrued
on any Deposit that is withdrawn pursuant to a Notice of Purchase Withdrawal (as
defined below) shall be paid on the next Interest Payment Date, notwithstanding
any intervening Final Withdrawal (as defined below).




            SECTION 2.3 WITHDRAWALS. (a) On and after the date seven days after
the receipt and acceptance of any Deposit, the Escrow Agent may, by providing at
least one Business Day's prior notice of withdrawal to the Depositary (with a
copy to the Pass Through Trustee) in the form of Exhibit A hereto (a "NOTICE OF
PURCHASE WITHDRAWAL"), signed by an Authorized Person of the Escrow Agent,
withdraw not less than the entire balance of such Deposit on a Business Day,
except that at any time prior to the actual withdrawal of such Deposit, the
Escrow Agent or the Pass Through Trustee may, by written notice, signed by an
Authorized Person of the Escrow Agent or the Pass Through Trustee, to the
Depositary (provided such notice is received by the Depositary prior to the
distribution of such withdrawal), cancel such withdrawal (including on the
scheduled date therefor), and thereafter such Deposit shall continue to be
maintained by the Depositary in accordance with the original terms thereof.
Following such withdrawal the balance of such Deposit in the related Account
shall be zero and, upon payment of interest accrued on such Deposit, the
Depositary shall close such Account. As used herein, "BUSINESS DAY" means any
day, other than a Saturday, Sunday or other day on which commercial banks are
authorized or required by law to close in New York, New York, Houston, Texas or
Wilmington, Delaware and which is also a day for trading by and between banks in
the London interbank Eurodollar market. The Depositary may waive the foregoing
requirement that any Deposit can only be withdrawn on or after seven days after
the establishment thereof, and may instead reserve the right, upon at least 14
days' prior written notice to Continental, the Escrow Agent and the Pass Through
Trustee, to require seven days' notice for any withdrawal.

            (b) The Escrow Agent may, by providing at least 15 days' prior
notice of withdrawal to the Depositary in the form of Exhibit B hereto (a
"NOTICE OF FINAL WITHDRAWAL"), withdraw the entire amount of all of the
remaining Deposits together with the payment by the Depositary of all accrued
and unpaid interest on such Deposits up to but excluding the specified date of
withdrawal (a "FINAL WITHDRAWAL"), on such Business Day as shall be specified in
such Notice of Final Withdrawal. If a Notice of Final Withdrawal has not been
received by the Depositary on or before April 11, 2005, and there are
unwithdrawn Deposits in any of the Accounts on such date, the Depositary shall
pay, via wire transfer in accordance with the instructions set forth in Section
4 hereof, the amount of the Final Withdrawal to the Paying Agent on April 29,
2005.

            (c) If the Depositary timely receives a duly completed Notice of
Purchase Withdrawal or Notice of Final Withdrawal (each, a "WITHDRAWAL NOTICE")
complying with the provisions of this Agreement, and provided a notice of
cancellation has not been timely received by the Depositary in the case of a
Notice of Purchase Withdrawal, it shall make the payments specified therein in
accordance with the provisions of this Agreement.

            SECTION 2.4 OTHER ACCOUNTS. On the date of withdrawal of any Deposit
(other than the date of the Final Withdrawal), the Escrow Agent, or the Pass
Through Trustee on behalf of the Escrow Agent, shall re-deposit with the
Depositary any portion thereof not used to acquire Equipment Notes and the
Depositary shall accept the same for deposit hereunder into the account from
which it was withdrawn. On the date the Certificates are issued, the Escrow
Agent, or the Underwriters, on behalf of the Escrow Agent, shall be entitled to
deposit with the Depositary any portion of the Net Proceeds not theretofore
deposited hereunder and not used to purchase Equipment Notes on the Issuance



Date (the "UNUSED PROCEEDS") and the Depositary shall accept the Unused Proceeds
for deposit hereunder. Any sums so received for deposit shall be received as a
new Deposit, credited to a new Account, and Schedule I hereto shall be amended
to include such Deposit, all as more fully provided in Section 2.1 hereof, and
thereafter the provisions of this Agreement shall apply thereto as fully and
with the same force and effect as if such Deposit had been established on the
Deposit Date except that (i) such Deposit may not be withdrawn prior to the date
seven days after the receipt and acceptance thereof by the Depositary and (ii)
such Deposit shall mature on April 29, 2005 and bear interest as provided in
Section 2.2. The Depositary shall promptly give notice to the Escrow Agent of
receipt of each such re-deposit and the account number assigned thereto.

            SECTION 3. TERMINATION. This Agreement shall terminate on the fifth
Business Day after the later of the date on which (i) all of the Deposits shall
have been withdrawn and paid as provided herein without any re-deposit and (ii)
all accrued and unpaid interest on the Deposits shall have been paid as provided
herein.

            SECTION 4. PAYMENTS. All payments (including, without limitation,
those payments made in respect of Taxes (as defined and provided for below))
made by the Depositary hereunder shall be paid in United States Dollars and
immediately available funds by wire transfer (i) in the case of accrued interest
on the Deposits payable under Section 2.2 hereof or any Final Withdrawal,
directly to the Paying Agent at Wilmington Trust Company, Wilmington, DE, ABA#
031100092, Account No. 066211-000 "2004 ERJ1", Attention: Monica Henry,
Telephone No.: (302) 636-6296, Reference: Continental Airlines PTT, Series
2004-ERJ1, or to such other account as the Paying Agent may direct from time to
time in writing to the Depositary and the Escrow Agent and (ii) in the case of
any withdrawal of one or more Deposits pursuant to a Notice of Purchase
Withdrawal, directly to or as directed by the Pass Through Trustee as specified
and in the manner provided in such Notice of Purchase Withdrawal. The Depositary
hereby waives any and all rights of set-off, combination of accounts, right of
retention or similar right (whether arising under applicable law, contract or
otherwise) it may have against the Deposits howsoever arising. All payments on
or in respect of each Deposit shall be made free and clear of and without
reduction for or on account of any and all taxes, levies or other impositions or
charges (collectively, "TAXES"). However, if the Depositary shall be required by
law to deduct or withhold any Taxes from or in respect of any sum payable
hereunder, the Depositary shall (i) make such deductions or withholding, (ii)
pay the full amount deducted or withheld (including in respect of such
additional amounts) to the competent taxation authority and (iii) if the Taxes
required to be deducted or withheld are imposed by the Federal Republic of
Germany or any political subdivision thereof, pay such additional amounts as may
be necessary in order that the actual amount received by the designated
recipient of such sum under this Agreement or the Escrow and Paying Agent
Agreement after such deduction or withholding equals the sum it would have
received had no such deduction or withholding been required. The Depositary
shall not have any withholding or tax reporting obligations with respect to the
Deposits, except as may be required by law. If the date on which any payment due
on any Deposit would otherwise fall on a day which is not a Business Day, such
payment shall be made on the next succeeding Business Day, and no additional
interest shall accrue in respect of such extension.




            SECTION 5. REPRESENTATION AND WARRANTIES. The Depositary hereby
represents and warrants to Continental, the Escrow Agent, the Pass Through
Trustee and the Paying Agent that:

                  (a) it is duly organized and validly existing as a joint stock
      company ("Aktiengesellschaft") under the laws of Germany and is duly
      qualified to conduct banking business in the State of New York through its
      New York Branch;

                  (b) it has full power, authority and legal right to conduct
      its business and operations as currently conducted and to enter into and
      perform its obligations under this Agreement;

                  (c) the execution, delivery and performance of this Agreement
      have been duly authorized by all necessary corporate action on the part of
      it and do not require any stockholder approval, or approval or consent of
      any trustee or holder of any indebtedness or obligations of it, and this
      Agreement has been duly executed and delivered by it and constitutes its
      legal, valid and binding obligations enforceable against it in accordance
      with the terms hereof;

                  (d) no authorization, consent or approval of or other action
      by, and no notice to or filing with, any United States federal or state
      governmental authority or regulatory body is required for the execution,
      delivery or performance by it of this Agreement;

                  (e) neither the execution, delivery or performance by it of
      this Agreement, nor compliance with the terms and provisions hereof,
      conflicts or will conflict with or results or will result in a breach or
      violation of any of the terms, conditions or provisions of, or will
      require any consent or approval under, any law, governmental rule or
      regulation or the charter documents, as amended, or bylaws, as amended, of
      it or any similar instrument binding on it or any order, writ, injunction
      or decree of any court or governmental authority against it or by which it
      or any of its properties is bound or of any indenture, mortgage or
      contract or other agreement or instrument to which it is a party or by
      which it or any of its properties is bound, or constitutes or will
      constitute a default thereunder or results or will result in the
      imposition of any lien upon any of its properties; and

                  (f) there are no pending or, to its knowledge, threatened
      actions, suits, investigations or proceedings (whether or not purportedly
      on behalf of it) against or affecting it or any of its property before or
      by any court or administrative agency which, if adversely determined, (i)
      would adversely affect the ability of it to perform its obligations under
      this Agreement or (ii) would call into question or challenge the validity
      of this Agreement or the enforceability hereof in accordance with the
      terms hereof, nor is the Depositary in default with respect to any order
      of any court, governmental authority, arbitration board or administrative
      agency so as to adversely affect its ability to perform its obligations
      under this Agreement.




            SECTION 6. TRANSFER. Neither party hereto shall be entitled to
assign or otherwise transfer this Agreement (or any interest herein) other than
(in the case of the Escrow Agent) to a successor escrow agent under the Escrow
and Paying Agent Agreement, and any purported assignment in violation thereof
shall be void. This Agreement shall be binding upon the parties hereto and their
respective successors and (in the case of the Escrow Agent) permitted assigns.

            SECTION 7. AMENDMENT, ETC. This Agreement may not be amended, waived
or otherwise modified except by an instrument in writing signed by each of the
parties hereto.

            SECTION 8. NOTICES. Unless otherwise expressly provided herein, any
notice or other communication under this Agreement shall be in writing
(including by facsimile) and shall be deemed to be given and effective upon
receipt thereof. All notices shall be sent to (x) in the case of the Depositary,
WESTLB AG, New York Branch, 1211 Avenue of the Americas, New York, New York
10036, Attention: Brigitte Thieme (Telephone: (212) 852-6111, Telecopier: (212)
869-7634), with a copy to WESTLB AG, New York Branch, 1211 Avenue of the
Americas, New York, New York 10036, Attention: Eugene Chan (Telephone: (212)
852-6172, Telecopier: (212) 852-6305) or (y) in the case of the Escrow Agent,
Wells Fargo Bank Northwest, National Association, 299 South Main Street, MAC:
U1228-120, Salt Lake City, UT 84111, Attention: Corporate Trust Services
(Telephone: (801) 246-5630, Telecopier: (801) 246-5053), in each case, with a
copy to the Pass Through Trustee, Wilmington Trust Company, 1100 North Market
Street, Rodney Square North, Wilmington, DE 19890-1605, Attention: Corporate
Capital Market Services (Telephone: (800) 733-8485, Telecopier: (302) 636-4140)
and to Continental, Continental Airlines, Inc., 1600 Smith Street, Dept. HQS-FN,
Houston, TX 77002, Attention: Treasurer (Telephone: (713) 324-2544, Telecopier:
(713) 324-2447) (or at such other address as any such party may specify from
time to time in a written notice to the parties hereto). On or prior to the
execution of this Agreement, the Escrow Agent has delivered to the Depositary a
certificate containing specimen signatures of the representatives of the Escrow
Agent and the Pass Through Trustee who are authorized to give notices and
instructions with respect to this Agreement, attached hereto as Schedule IIA and
IIB, respectively ("Authorized Person"). The Depositary may conclusively rely on
such certificate until the Depositary receives written notice from the Escrow
Agent to the contrary.

            In addition, the Depositary may conclusively rely on and shall be
protected in acting in reliance upon any certificate, instrument, opinion,
notice, letter or other document or security delivered to the Depositary and
believed by the Depositary in good faith to be genuine and to have been signed
and presented by the proper person or persons and may act upon any tender,
statements, request, documents, certificate, agreement or other instrument not
only as to its due execution and validity and effectiveness of its provisions,
but also as to the truth and accuracy of any information contained therein,
which the Depositary shall in good faith believe to be genuine or to have been
signed or presented by the proper person or persons. The Depositary shall have
no duties or obligations other than those specifically set forth herein or as
may be subsequently agreed to in writing between the parties hereto and by the
Pass Through Trustee. The Depositary may consult with counsel of its selection
with respect to any questions relating to its duties and responsibilities and
the advice or opinion of such counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted to be taken



by the Depositary hereunder in good faith and in accordance with the advice or
opinion of such counsel.

            SECTION 9. OBLIGATIONS UNCONDITIONAL. The Depositary hereby
acknowledges and agrees that its obligation to repay each Deposit together with
interest thereon as provided herein is absolute, irrevocable and unconditional
and constitutes a full recourse obligation of the Depositary enforceable against
it to the full extent of all of its assets and properties.

            SECTION 10. ENTIRE AGREEMENT. This Agreement (including all
attachments hereto) sets forth all of the promises, covenants, agreements,
conditions and understandings between the Depositary and the Escrow Agent with
respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements and undertakings, inducements or conditions, express
or implied, oral or written.

            SECTION 11. GOVERNING LAW. This Agreement, and the rights and
obligations of the Depositary and the Escrow Agent with respect to the Deposits,
shall be governed by, and construed in accordance with, the laws of the State of
New York and subject to the provisions of Regulation D of the Board of Governors
of the Federal Reserve System (or any successor), as the same may be modified
and supplemented and in effect from time to time.

            SECTION 12. WAIVER OF JURY TRIAL RIGHT. EACH OF THE DEPOSITARY AND
THE ESCROW AGENT ACKNOWLEDGES AND ACCEPTS THAT IN ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT SUCH PARTY IRREVOCABLY WAIVES ITS
RIGHT TO A TRIAL BY JURY.

            SECTION 13. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, all of which taken together shall constitute one instrument.






            IN WITNESS WHEREOF, the Escrow Agent and the Depositary have caused
this Deposit Agreement to be duly executed as of the day and year first above
written.


                                          WELLS FARGO BANK NORTHWEST, NATIONAL
                                          ASSOCIATION,
                                             as Escrow Agent


                                          By
                                            ------------------------------------
                                            Name:
                                            Title:

                                          WESTLB AG, acting through its New
                                             York Branch, as Depositary


                                          By
                                            ------------------------------------
                                            Name:
                                            Title:

                                          By
                                            ------------------------------------
                                            Name:
                                            Title:





                                                                      Schedule I


                              SCHEDULE OF DEPOSITS


       -------------------------------------------------------------
      |                    |                     |                  |
      |   AIRCRAFT TYPE    |   DEPOSIT AMOUNT    |   ACCOUNT NO.    |
      |--------------------|---------------------|------------------|
      |     EMB-145XR      |   $10,807,828.65    |     N11165       |
      |--------------------|---------------------|------------------|
      |     EMB-145XR      |   $10,890,935.23    |     N12166       |
      |--------------------|---------------------|------------------|
      |     EMB-145XR      |   $10,890,935.23    |     N12167       |
      |--------------------|---------------------|------------------|
      |     EMB-145XR      |   $10,943,542.59    |     N14168       |
      |--------------------|---------------------|------------------|
      |     EMB-145XR      |   $10,946,576.81    |     N17169       |
      |--------------------|---------------------|------------------|
      |     EMB-145XR      |   $10,945,289.32    |     N16170       |
       -------------------- --------------------- ------------------





                                                             Schedule II A & B



                             INCUMBENCY CERTIFICATES





                                                                       EXHIBIT A



                          NOTICE OF PURCHASE WITHDRAWAL


WESTLB AG, acting through its New York Branch
1211 Avenue of the Americas
New York, New York 10036
Attention:  Brigitte Thieme; Telecopier:  (212) 869-7634
            Eugene Chan; Telecopier:  (212) 852-6305


Gentlemen:

            Reference is made to the Deposit Agreement dated as of June 29, 2004
(the "DEPOSIT AGREEMENT") between Wells Fargo Bank Northwest, National
Association, as Escrow Agent, and WESTLB AG, acting through its New York Branch,
as Depositary (the "DEPOSITARY").

            In accordance with Section 2.3(a) of the Deposit Agreement, the
undersigned hereby requests the withdrawal of the entire amount of the Deposit,
$[_______], Account No. ____________.

            The undersigned hereby directs the Depositary to pay the proceeds of
the Deposit to ________________, Account No. _____, Reference: _________] on
_________ __, 200__, upon the telephonic request of a representative of the Pass
Through Trustee.


                                          WELLS FARGO BANK NORTHWEST,
                                             NATIONAL ASSOCIATION,
                                             as Escrow Agent


                                          By
                                            ------------------------------------
                                             Name:
                                             Title:
Dated: _______ __, 200_



                                                                       EXHIBIT B


                           NOTICE OF FINAL WITHDRAWAL


WESTLB AG, acting through its New York Branch
1211 Avenue of the Americas
New York, New York 10036
Attention:  Brigitte Thieme; Telecopier:  (212) 869-7634
            Eugene Chan; Telecopier:  (212) 852-6305


Gentlemen:

            Reference is made to the Deposit Agreement dated as of June 29, 2004
(the "DEPOSIT AGREEMENT") between Wells Fargo Bank Northwest, National
Association, as Escrow Agent, and WESTLB AG, acting through its New York Branch,
as Depositary (the "DEPOSITARY").

            In accordance with Section 2.3(b)(i) of the Deposit Agreement, the
undersigned hereby requests the withdrawal of the entire amount of all Deposits
and all accrued interest to date on such Deposits.

            The undersigned hereby directs the Depositary to pay the proceeds of
the Deposits and accrued interest thereon to the Paying Agent at Wilmington
Trust Company, ABA# 031100092, Account No. _____________, Reference: Continental
2004-ERJ1.


                                          WELLS FARGO BANK NORTHWEST,
                                             NATIONAL ASSOCIATION,
                                             as Escrow Agent


                                          By
                                            ------------------------------------
                                             Name:
                                             Title:
Dated: _________, 200_







                        ESCROW AND PAYING AGENT AGREEMENT


                            Dated as of June 29, 2004

                                      among

                WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION

                                 as Escrow Agent

                          CITIGROUP GLOBAL MARKETS INC.

                                       and

                        MORGAN STANLEY & CO. INCORPORATED

                                 as Underwriters

                            WILMINGTON TRUST COMPANY,
                         not in its individual capacity,
                       but solely as Pass Through Trustee
                              for and on behalf of
                Continental Airlines Pass Through Trust 2004-ERJ1

                             as Pass Through Trustee

                                       and

                            WILMINGTON TRUST COMPANY

                                 as Paying Agent






                                TABLE OF CONTENTS
                                                                             cv
                                                                             --
SECTION 1.        Escrow Agent...............................................2
    Section 1.01. Appointment of Escrow Agent................................2
    Section 1.02. Instruction; Etc...........................................2
    Section 1.03. Initial Escrow Amount; Issuance of Escrow Receipts.........3
    Section 1.04. Payments to Receiptholders.................................4
    Section 1.05. Mutilated, Destroyed, Lost or Stolen Escrow Receipt........4
    Section 1.06. Additional Escrow Amounts..................................5
    Section 1.07. Resignation or Removal of Escrow Agent.....................5
    Section 1.08. Persons Deemed Owners......................................5
    Section 1.09. Further Assurances.........................................5

SECTION 2.        Paying Agent...............................................5
    Section 2.01. Appointment of Paying Agent................................5
    Section 2.02. Establishment of Paying Agent Account......................6
    Section 2.03. Payments From Paying Agent Account.........................6
    Section 2.04. Withholding Taxes..........................................7
    Section 2.05. Resignation or Removal of Paying Agent.....................7
    Section 2.06. Notice of Final Withdrawal.................................8

SECTION 3.        Payments...................................................8

SECTION 4.        Other Actions..............................................8

SECTION 5.        Representations and Warranties of the Escrow AgenT.........8

SECTION 6.        Representations and Warranties of the Paying Agent........10

SECTION 7.        Indemnification...........................................11

SECTION 8.        Amendment, Etc............................................11

SECTION 9.        Notices...................................................11

SECTION 10.       Transfer..................................................12

SECTION 11.       Entire Agreement..........................................12

SECTION 12.       Governing Law.............................................12

SECTION 13.       Waiver of Jury Trial Right................................12

SECTION 14.       Counterparts..............................................12

Exhibit A         Escrow Receipt

Exhibit B         Withdrawal Certificate




      ESCROW AND PAYING AGENT AGREEMENT dated as of June 29, 2004 (as amended,
modified or supplemented from time to time, this "AGREEMENT") among WELLS FARGO
BANK NORTHWEST, NATIONAL ASSOCIATION, a national banking association, as Escrow
Agent (in such capacity, together with its successors in such capacity, the
"ESCROW AGENT"); CITIGROUP GLOBAL MARKETS INC. and MORGAN STANLEY & CO.
INCORPORATED, as Underwriters of the Certificates referred to below (the
"UNDERWRITERS" and together with their respective transferees and assigns as
registered owners of the Certificates, the "INVESTORS") under the Underwriting
Agreement referred to below; WILMINGTON TRUST COMPANY, a Delaware banking
corporation, not in its individual capacity except as otherwise expressly
provided herein, but solely as trustee (in such capacity, together with its
successors in such capacity, the "PASS THROUGH TRUSTEE") under the Pass Through
Trust Agreement referred to below; and WILMINGTON TRUST COMPANY, a Delaware
banking corporation, as paying agent hereunder (in such capacity, together with
its successors in such capacity, the "PAYING AGENT").

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

            WHEREAS, Continental Airlines, Inc. ("CONTINENTAL") and the Pass
Through Trustee have entered into a Trust Supplement, dated as of June 29, 2004
(the "TRUST SUPPLEMENT"), to the Pass Through Trust Agreement, dated as of
September 25, 1997 (together, as amended, modified or supplemented from time to
time in accordance with the terms thereof, the "PASS THROUGH TRUST AGREEMENT")
relating to Continental Airlines Pass Through Trust 2004-ERJ1 (the "PASS THROUGH
TRUST") pursuant to which the Continental Airlines Pass Through Trust, Series
2004-ERJ1 Certificates referred to therein (the "CERTIFICATES") are being issued
(the date of such issuance, the "ISSUANCE DATE");

            WHEREAS, Continental, the Depositary and the Underwriters have
entered into an Underwriting Agreement dated as of June 18, 2004 (as amended,
modified or supplemented from time to time in accordance with the terms thereof,
the "UNDERWRITING AGREEMENT") pursuant to which the Pass Through Trustee will
issue and sell the Certificates to the Underwriters;

            WHEREAS, Continental, the Pass Through Trustee, and certain other
persons concurrently herewith are entering into the Note Purchase Agreement,
dated as of the date hereof (the "NOTE PURCHASE AGREEMENT"), pursuant to which
the Pass Through Trustee has agreed to acquire from time to time on or prior to
the Delivery Period Termination Date (as defined in the Note Purchase Agreement)
equipment notes (the "EQUIPMENT NOTES") issued to finance the acquisition of
aircraft by Continental, as lessee, utilizing a portion of the proceeds from the
sale of the Certificates (the "NET PROCEEDS");

            WHEREAS, the Underwriters and the Pass Through Trustee intend that
the Net Proceeds (excluding any amount used to purchase Equipment Notes on the
Issuance Date) be held in escrow by the Escrow Agent on behalf of the Investors,
subject to withdrawal upon request by the Pass Through Trustee and satisfaction
of the conditions set forth in the Note Purchase Agreement for the purpose of
purchasing Equipment Notes, and that pending such withdrawal the Net Proceeds be
deposited on behalf of the Escrow Agent with WESTLB AG, acting through its New
York Branch, as Depositary (the "DEPOSITARY") under the Deposit Agreement, dated



as of the date hereof between the Depositary and the Escrow Agent relating to
the Pass Through Trust (as amended, modified, supplemented or replaced from time
to time in accordance with the terms thereof, the "DEPOSIT AGREEMENT") pursuant
to which, among other things, the Depositary will pay interest for distribution
to the Investors and establish accounts from which the Escrow Agent shall make
withdrawals upon request of and proper certification by the Pass Through
Trustee;

            WHEREAS, the Escrow Agent wishes to appoint the Paying Agent to pay
amounts required to be distributed to the Investors in accordance with this
Agreement; and

            WHEREAS, capitalized terms used but not defined herein shall have
the meanings ascribed to such terms in the Pass Through Trust Agreement.

            NOW, THEREFORE, in consideration of the obligations contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:

            SECTION 1.  ESCROW AGENT.

            Section 1.01. APPOINTMENT OF ESCROW AGENT. Each of the Underwriters,
for and on behalf of each of the Investors, hereby irrevocably appoints,
authorizes and directs the Escrow Agent to act as escrow agent and fiduciary
hereunder and under the Deposit Agreement for such specific purposes and with
such powers as are specifically delegated to the Escrow Agent by the terms of
this Agreement, together with such other powers as are reasonably incidental
thereto. Any and all money received and held by the Escrow Agent under this
Agreement or the Deposit Agreement shall be held in escrow by the Escrow Agent
in accordance with the terms of this Agreement. This Agreement is irrevocable
and the Investors' rights with respect to any monies received and held in escrow
by the Escrow Agent under this Agreement or the Deposit Agreement shall only be
as provided under the terms and conditions of this Agreement and the Deposit
Agreement. The Escrow Agent (which term as used in this sentence shall include
reference to its affiliates and its own and its affiliates' officers, directors,
employees and agents): (a) shall have no duties or responsibilities except those
expressly set forth in this Agreement; (b) shall not be responsible to the Pass
Through Trustee or the Investors for any recitals, statements, representations
or warranties of any person other then itself contained in this Agreement or the
Deposit Agreement or for the failure by the Pass Through Trustee, the Investors
or any other person or entity (other than the Escrow Agent) to perform any of
its obligations hereunder (whether or not the Escrow Agent shall have any
knowledge thereof); and (c) shall not be responsible for any action taken or
omitted to be taken by it hereunder or provided for herein or in connection
herewith, except for its own willful misconduct or gross negligence (or simple
negligence in connection with the handling of funds).

            Section 1.02. INSTRUCTION; ETC. The Underwriters, for and on behalf
of each of the Investors, hereby irrevocably instruct the Escrow Agent, and the
Escrow Agent agrees, (a) to enter into the Deposit Agreement, (b) to appoint the
Paying Agent as provided in this Agreement, (c) upon receipt at any time and



from time to time prior to the Termination Date (as defined below) of a
certificate substantially in the form of Exhibit B hereto (a "WITHDRAWAL
CERTIFICATE") executed by the Pass Through Trustee, together with an attached
Notice of Purchase Withdrawal in substantially the form of Exhibit A to the
Deposit Agreement duly completed by the Pass Through Trustee (the "APPLICABLE
NOTICE OF PURCHASE WITHDRAWAL" and the withdrawal to which it relates, a
"PURCHASE WITHDRAWAL"), immediately to execute the Applicable Notice of Purchase
Withdrawal as Escrow Agent and transmit it to the Depositary by facsimile
transmission in accordance with the Deposit Agreement; PROVIDED that, upon the
request of the Pass Through Trustee after such transmission, the Escrow Agent
shall cancel such Applicable Notice of Purchase Withdrawal, and (d) if there are
any undrawn Deposits (as defined in the Deposit Agreement) on the "TERMINATION
DATE", which shall mean the earlier of (i) March 31, 2005 and (ii) the day on
which the Escrow Agent receives notice from the Pass Through Trustee that the
Pass Through Trustee's obligation to purchase Equipment Notes under the Note
Purchase Agreement has terminated, to give notice to the Depositary (with a copy
to the Paying Agent) substantially in the form of Exhibit B to the Deposit
Agreement requesting a withdrawal of all of the remaining Deposits, together
with accrued and unpaid interest on such Deposits to the date of withdrawal, on
the 25th day after the date that such notice of withdrawal is given to the
Depositary (or, if not a Business Day, on the next succeeding Business Day) (a
"FINAL WITHDRAWAL"), PROVIDED that if the day scheduled for the Final Withdrawal
in accordance with the foregoing is within 10 days before or after a Regular
Distribution Date, then the Escrow Agent shall request that such requested Final
Withdrawal be made on such Regular Distribution Date (the date of such requested
withdrawal, the "FINAL WITHDRAWAL DATE"). If for any reason the Escrow Agent
shall have failed to give the Final Withdrawal Notice to the Depositary on or
before April 11, 2005, and there are unwithdrawn Deposits on such date, the
Final Withdrawal Date shall be deemed to be April 29, 2005.

            Section 1.03. INITIAL ESCROW AMOUNT; ISSUANCE OF ESCROW RECEIPTS.
The Escrow Agent hereby directs the Underwriters to, and the Underwriters hereby
acknowledge that on the date hereof they shall, irrevocably deliver to the
Depositary on behalf of the Escrow Agent, an amount in U.S. dollars ("DOLLARS")
and immediately available funds equal to $173,629,000 (or such lesser amount
equal to the Net Proceeds less amounts, if any, used to purchase Equipment Notes
on the Issuance Date) for deposit on behalf of the Escrow Agent with the
Depositary in accordance with Section 2.1 of the Deposit Agreement. The
Underwriters hereby instruct the Escrow Agent, upon receipt of such sum from the
Underwriters, to confirm such receipt by executing and delivering to the Pass
Through Trustee an Escrow Receipt in the form of Exhibit A hereto (an "ESCROW
RECEIPT"), (a) to be affixed by the Pass Through Trustee to each Certificate and
(b) to evidence the same percentage interest (the "ESCROW INTEREST") in the
Account Amounts (as defined below) as the Fractional Undivided Interest in the
Pass Through Trust evidenced by the Certificate to which it is to be affixed.
The Escrow Agent shall provide to the Pass Through Trustee for attachment to
each Certificate newly issued under and in accordance with the Pass Through
Trust Agreement an executed Escrow Receipt as the Pass Through Trustee may from
time to time request of the Escrow Agent. Each Escrow Receipt shall be
registered by the Escrow Agent in a register (the "REGISTER") maintained by the
Escrow Agent in the same name and same manner as the Certificate to which it is
attached and may not thereafter be detached from such Certificate to which it is
to be affixed prior to the distribution of the Final Withdrawal (the "FINAL



DISTRIBUTION"). After the Final Distribution, no additional Escrow Receipts
shall be issued and the Pass Through Trustee shall request the return to the
Escrow Agent for cancellation of all outstanding Escrow Receipts.

            Section 1.04. PAYMENTS TO RECEIPTHOLDERS. All payments and
distributions made to holders of an Escrow Receipt (collectively
"RECEIPTHOLDERS") in respect of the Escrow Receipt shall be made only from
amounts deposited in the Paying Agent Account (as defined below) ("ACCOUNT
AMOUNTS"). Each Receiptholder, by its acceptance of an Escrow Receipt, agrees
that (a) it will look solely to the Account Amounts for any payment or
distribution due to such Receiptholder pursuant to the terms of the Escrow
Receipt and this Agreement and (b) it will have no recourse to Continental, the
Pass Through Trustee, the Paying Agent or the Escrow Agent, except as expressly
provided herein or in the Pass Through Trust Agreement. No Receiptholder shall
have any right to vote or in any manner otherwise control the operation and
management of the Paying Agent Account or the obligations of the parties hereto,
nor shall anything set forth herein, or contained in the terms of the Escrow
Receipt, be construed so as to constitute the Receiptholders from time to time
as partners or members of an association.

            Section 1.05. MUTILATED, DESTROYED, LOST OR STOLEN ESCROW RECEIPT.
If (a) any mutilated Escrow Receipt is surrendered to the Escrow Agent or the
Escrow Agent receives evidence to its satisfaction of the destruction, loss or
theft of any Escrow Receipt and (b) there is delivered to the Escrow Agent and
the Pass Through Trustee such security, indemnity or bond, as may be required by
them to hold each of them harmless, then, absent notice to the Escrow Agent or
the Pass Through Trustee that such destroyed, lost or stolen Escrow Receipt has
been acquired by a bona fide purchaser, and provided that the requirements of
Section 8-405 of the Uniform Commercial Code in effect in any applicable
jurisdiction are met, the Escrow Agent shall execute, authenticate and deliver,
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Escrow Receipt, a new Escrow Receipt or Escrow Receipts and of like Escrow
Interest in the Account Amounts and bearing a number not contemporaneously
outstanding.

            In connection with the issuance of any new Escrow Receipt under this
Section 1.05, the Escrow Agent may 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 Pass
Through Trustee and the Escrow Agent) connected therewith.

            Any duplicate Escrow Receipt issued pursuant to this Section 1.05
shall constitute conclusive evidence of the appropriate Escrow Interest in the
Account Amounts, as if originally issued, whether or not the lost, stolen or
destroyed Escrow Receipt shall be found at any time.

            The provisions of this Section 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 Escrow Receipts.




            Section 1.06. ADDITIONAL ESCROW AMOUNTS. On the date of any Purchase
Withdrawal, the Pass Through Trustee may re-deposit with the Depositary some or
all of the amounts so withdrawn in accordance with Section 2.4 of the Deposit
Agreement.

            Section 1.07. RESIGNATION OR REMOVAL OF ESCROW AGENT. Subject to the
appointment and acceptance of a successor Escrow Agent as provided below, the
Escrow Agent may resign at any time by giving 30 days' prior written notice
thereof to the Investors, but may not otherwise be removed except for cause by
the written consent of the Investors with respect to Investors representing
Escrow Interests aggregating not less than a majority in interest in the Account
Amounts (an "ACTION OF INVESTORS"). Upon any such resignation or removal, the
Investors, by an Action of Investors, shall have the right to appoint a
successor Escrow Agent. If no successor Escrow Agent shall have been so
appointed and shall have accepted such appointment within 30 days after the
retiring Escrow Agent's giving of notice of resignation or the removal of the
retiring Escrow Agent, then the retiring Escrow Agent may appoint a successor
Escrow Agent. Any successor Escrow Agent shall be a bank which has an office in
the United States with a combined capital and surplus of at least $100,000,000.
Upon the acceptance of any appointment as Escrow Agent hereunder by a successor
Escrow Agent, such successor Escrow Agent shall enter into such documents as the
Pass Through Trustee shall require and shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Escrow
Agent, and the retiring Escrow Agent shall be discharged from its duties and
obligations hereunder. No resignation or removal of the Escrow Agent shall be
effective unless a written confirmation shall have been obtained from each of
Moody's Investors Service, Inc. and Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc., that the replacement of the Escrow
Agent with the successor Escrow Agent will not result in (a) a reduction of the
rating for the Certificates below the then current rating for the Certificates
or (b) a withdrawal or suspension of the rating of the Certificates.

            Section 1.08. PERSONS DEEMED OWNERS. Prior to due presentment of a
Certificate for registration of transfer, the Escrow Agent and the Paying Agent
may treat the Person in whose name any Escrow Receipt is registered (as of the
day of determination) as the owner of such Escrow Receipt for the purpose of
receiving distributions pursuant to this Agreement and for all other purposes
whatsoever, and neither the Escrow Agent nor the Paying Agent shall be affected
by any notice to the contrary.

            Section 1.09. FURTHER ASSURANCES. The Escrow Agent agrees to take
such actions, and execute such other documents, as may be reasonably requested
by the Pass Through Trustee in order to effectuate the purposes of this
Agreement and the performance by the Escrow Agent of its obligations hereunder.

            SECTION 2.  PAYING AGENT.

            Section 2.01. APPOINTMENT OF PAYING AGENT. The Escrow Agent hereby
irrevocably appoints and authorizes the Paying Agent to act as its paying agent
hereunder, for the benefit of the Investors, for such specific purposes and with
such powers as are specifically delegated to the Paying Agent by the terms of
this Agreement, together with such other powers as are reasonably incidental



thereto. Any and all money received and held by the Paying Agent under this
Agreement or the Deposit Agreement shall be held in the Paying Agent Account for
the benefit of the Investors. The Paying Agent (which term as used in this
sentence shall include reference to its affiliates and its own and its
affiliates' officers, directors, employees and agents): (a) shall have no duties
or responsibilities except those expressly set forth in this Agreement, and
shall not by reason of this Agreement be a trustee for the Escrow Agent; (b)
shall not be responsible to the Escrow Agent for any recitals, statements,
representations or warranties of any person other then itself contained in this
Agreement or for the failure by the Escrow Agent or any other person or entity
(other than the Paying Agent) to perform any of its obligations hereunder
(whether or not the Paying Agent shall have any knowledge thereof); and (c)
shall not be responsible for any action taken or omitted to be taken by it
hereunder or provided for herein or in connection herewith, except for its own
willful misconduct or gross negligence (or simple negligence in connection with
the handling of funds).

            Section 2.02. ESTABLISHMENT OF PAYING AGENT ACCOUNT. The Paying
Agent shall establish a deposit account (the "PAYING AGENT ACCOUNT") at
Wilmington Trust Company in the name of the Escrow Agent. It is expressly
understood by the parties hereto that the Paying Agent is acting as the paying
agent of the Escrow Agent hereunder and that no amounts on deposit in the Paying
Agent Account constitute part of the Trust Property.

            Section 2.03. PAYMENTS FROM PAYING AGENT ACCOUNT. The Escrow Agent
hereby irrevocably instructs the Paying Agent, and the Paying Agent agrees to
act, as follows:

                  (a) On each Interest Payment Date (as defined in the Deposit
      Agreement) or as soon thereafter as the Paying Agent has confirmed receipt
      in the Paying Agent Account from the Depositary of any amount in respect
      of accrued interest on the Deposits, the Paying Agent shall distribute out
      of the Paying Agent Account the entire amount deposited therein by the
      Depositary. There shall be so distributed to each Receiptholder of record
      on the 15th day (whether or not a Business Day) preceding such Interest
      Payment Date by check mailed to such Receiptholder, at the address
      appearing in the Register, such Receiptholder's pro rata share (based on
      the Escrow Interest in the Account Amounts held by such Receiptholder) of
      the total amount of interest deposited by the Depositary in the Paying
      Agent Account on such date, except that, with respect to Escrow Receipts
      registered on the Record Date in the name of The Depository Trust Company
      ("DTC"), such distribution shall be made by wire transfer in immediately
      available funds to the account designated by DTC.

                  (b) Upon the confirmation by the Paying Agent of receipt in
      the Paying Agent Account from the Depositary of any amount in respect of
      the Final Withdrawal, the Paying Agent shall forthwith distribute the
      entire amount of the Final Withdrawal deposited therein by the Depositary.
      There shall be so distributed to each Receiptholder of record on the 15th
      day (whether or not a Business Day) preceding the Final Withdrawal Date by
      check mailed to such Receiptholder, at the address appearing in the
      Register, such Receiptholder's pro rata share (based on the Escrow
      Interest in the Account Amounts held by such Receiptholder) of the total
      amount in the Paying Agent Account on account of such Final Withdrawal,



      except that, with respect to Escrow Receipts registered on the Record Date
      in the name of DTC, such distribution shall be made by wire transfer in
      immediately available funds to the account designated by DTC.

                  (c) If any payment of interest or principal in respect of the
      Final Withdrawal is not received by the Paying Agent within five days of
      the applicable date when due, then it shall be distributed to
      Receiptholders after actual receipt by the Paying Agent on the same basis
      as a Special Payment is distributed under the Pass Through Trust
      Agreement.

                  (d) The Paying Agent shall include with any check mailed
      pursuant to this Section any notice required to be distributed under the
      Pass Through Trust Agreement that is furnished to the Paying Agent by the
      Pass Through Trustee.

            Section 2.04. WITHHOLDING TAXES. The Paying Agent shall exclude and
withhold from each distribution of accrued interest on the Deposits (as defined
in the Deposit Agreement) and any amount in respect of the Final Withdrawal any
and all withholding taxes applicable thereto as required by law. The Paying
Agent 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 Deposits (as
defined in the Deposit Agreement) or the escrow amounts, to withhold such
amounts and timely pay the same to the appropriate authority in the name of and
on behalf of the Receiptholders, 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 Receiptholder appropriate
documentation showing the payment thereof, together with such additional
documentary evidence as such Receiptholder may reasonably request from time to
time. The Paying Agent agrees to file any other information reports as it may be
required to file under United States law.

            Section 2.05. RESIGNATION OR REMOVAL OF PAYING AGENT. Subject to the
appointment and acceptance of a successor Paying Agent as provided below, the
Paying Agent may resign at any time by giving 30 days' prior written notice
thereof to the Escrow Agent, but may not otherwise be removed except for cause
by the Escrow Agent. Upon any such resignation or removal, the Escrow Agent
shall have the right to appoint a successor Paying Agent. If no successor Paying
Agent shall have been so appointed and shall have accepted such appointment
within 30 days after the retiring Paying Agent's giving of notice of resignation
or the removal of the retiring Paying Agent, then the retiring Paying Agent may
appoint a successor Paying Agent. Any Successor Paying Agent shall be a bank
which has an office in the United States with a combined capital and surplus of
at least $100,000,000. Upon the acceptance of any appointment as Paying Agent
hereunder by a successor Paying Agent, such successor Paying Agent shall enter
into such documents as the Escrow Agent shall require and shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Paying Agent, and the retiring Paying Agent shall be discharged
from its duties and obligations hereunder.




            Section 2.06. NOTICE OF FINAL WITHDRAWAL. Promptly after receipt by
the Paying Agent of notice that the Escrow Agent has requested a Final
Withdrawal or that a Final Withdrawal will be made, the Paying Agent shall cause
notice of the distribution of the Final Withdrawal to be mailed to each of the
Receiptholders at its address as it appears in the Register. Such notice shall
be mailed not less than 15 days prior to the Final Withdrawal Date. Such notice
shall set forth:

                  (i) the Final Withdrawal Date and the date for determining
      Receiptholders of record who shall be entitled to receive distributions in
      respect of the Final Withdrawal,

                  (ii) the amount of the payment in respect of the Final
      Withdrawal for each $1,000 face amount Certificate (based on information
      provided by the Pass Through Trustee) and the amount thereof constituting
      unused Deposits (as defined in the Deposit Agreement) and interest
      thereon, and

                  (iii) if the Final Withdrawal Date is the same date as a
      Regular Distribution Date, the total amount to be received on such date
      for each $1,000 face amount Certificate (based on information provided by
      the Pass Through Trustee).

            Such mailing may include any notice required to be given to
Certificateholders in connection with such distribution pursuant to the Pass
Through Trust Agreement.

            SECTION 3.  PAYMENTS. If, notwithstanding the instructions in
Section 4 of the Deposit Agreement that all amounts payable to the Escrow Agent
under the Deposit Agreement be paid by the Depositary directly to the Paying
Agent or the Pass Through Trustee (depending on the circumstances), the Escrow
Agent receives any payment thereunder, then the Escrow Agent shall forthwith pay
such amount in Dollars and in immediately available funds by wire transfer to
(a) in the case of a payment of accrued interest on the Deposits (as defined in
the Deposit Agreement) or any Final Withdrawal, directly to the Paying Agent
Account, and (b) in the case of any Purchase Withdrawal, directly to the Pass
Through Trustee or its designee as specified and in the manner provided in the
Applicable Notice of Purchase Withdrawal. The Escrow Agent hereby waives any and
all rights of set-off, combination of accounts, right of retention or similar
right (whether arising under applicable law, contract or otherwise) it may have
against amounts payable to the Paying Agent howsoever arising.

            SECTION 4.  OTHER ACTIONS. The Escrow Agent shall take such other
actions under or in respect of the Deposit Agreement (including, without
limitation, the enforcement of the obligations of the Depositary thereunder) as
the Investors, by an Action of Investors, may from time to time request.

            SECTION 5.  REPRESENTATIONS AND WARRANTIES OF THE ESCROW AGENT. The
Escrow Agent represents and warrants to Continental, the Investors, the Paying
Agent and the Pass Through Trustee as follows:




                  (i) it is a national banking association duly organized and
      validly existing in good standing under the laws of the United States of
      America;

                  (ii) it has full power, authority and legal right to conduct
      its business and operations as currently conducted and to enter into and
      perform its obligations under this Agreement and the Deposit Agreement;

                  (iii) the execution, delivery and performance of each of this
      Agreement and the Deposit Agreement have been duly authorized by all
      necessary corporate action on the part of it and do not require any
      stockholder approval, or approval or consent of any trustee or holder of
      any indebtedness or obligations of it, and each such document has been
      duly executed and delivered by it and constitutes its legal, valid and
      binding obligations enforceable against it in accordance with the terms
      hereof or thereof except as such enforceability may be limited by
      bankruptcy, insolvency, moratorium, reorganization or other similar laws
      or equitable principles of general application to or affecting the
      enforcement of creditors' rights generally (regardless of whether such
      enforceability is considered in a proceeding in equity or at law);

                  (iv) no authorization, consent or approval of or other action
      by, and no notice to or filing with, any United States federal banking or
      Utah state governmental authority or regulatory body is required for the
      execution, delivery or performance by it of this Agreement or the Deposit
      Agreement;

                  (v) neither the execution, delivery or performance by it of
      this Agreement or the Deposit Agreement, nor compliance with the terms and
      provisions hereof or thereof, conflicts or will conflict with or results
      or will result in a breach or violation of any of the terms, conditions or
      provisions of, or will require any consent or approval under, any law,
      governmental rule or regulation or the charter documents, as amended, or
      bylaws, as amended, of it or any similar instrument binding on it or any
      order, writ, injunction or decree of any court or governmental authority
      against it or by which it or any of its properties is bound or any
      indenture, mortgage or contract or other agreement or instrument to which
      it is a party or by which it or any of its properties is bound, or
      constitutes or will constitute a default thereunder or results or will
      result in the imposition of any lien upon any of its properties; and

                  (vi) there are no pending or, to its knowledge, threatened
      actions, suits, investigations or proceedings (whether or not purportedly
      on behalf of it) against or affecting it or any of its property before or
      by any court or administrative agency which, if adversely determined, (A)
      would adversely affect the ability of it to perform its obligations under
      this Agreement or the Deposit Agreement or (B) would call into question or
      challenge the validity of this Agreement or the Deposit Agreement or the
      enforceability hereof or thereof in accordance with the terms hereof or
      thereof, nor is the Escrow Agent in default with respect to any order of



      any court, governmental authority, arbitration board or administrative
      agency so as to adversely affect its ability to perform its obligations
      under this Agreement or the Deposit Agreement.

            SECTION 6.  REPRESENTATIONS AND WARRANTIES OF THE PAYING AGENT. The
Paying Agent represents and warrants to Continental, the Investors, the Escrow
Agent and the Pass Through Trustee as follows:

                  (i) it is a Delaware banking company duly organized and
      validly existing in good standing under the laws of its jurisdiction of
      incorporation;

                  (ii) it has full power, authority and legal right to conduct
      its business and operations as currently conducted and to enter into and
      perform its obligations under this Agreement;

                  (iii) the execution, delivery and performance of this
      Agreement has been duly authorized by all necessary corporate action on
      the part of it and does not require any stockholder approval, or approval
      or consent of any trustee or holder of any indebtedness or obligations of
      it, and such document has been duly executed and delivered by it and
      constitutes its legal, valid and binding obligations enforceable against
      it in accordance with the terms hereof except as such enforceability may
      be limited by bankruptcy, insolvency, moratorium, reorganization or other
      similar laws or equitable principles of general application to or
      affecting the enforcement of creditors' rights generally (regardless of
      whether such enforceability is considered in a proceeding in equity or at
      law);

                  (iv) no authorization, consent or approval of or other action
      by, and no notice to or filing with, any United States federal or state
      governmental authority or regulatory body is required for the execution,
      delivery or performance by it of this Agreement;

                  (v) neither the execution, delivery or performance by it of
      this Agreement, nor compliance with the terms and provisions hereof,
      conflicts or will conflict with or results or will result in a breach or
      violation of any of the terms, conditions or provisions of, or will
      require any consent or approval under, any law, governmental rule or
      regulation or the charter documents, as amended, or bylaws, as amended, of
      it or any similar instrument binding on it or any order, writ, injunction
      or decree of any court or governmental authority against it or by which it
      or any of its properties is bound or any indenture, mortgage or contract
      or other agreement or instrument to which it is a party or by which it or
      any of its properties is bound, or constitutes or will constitute a
      default thereunder or results or will result in the imposition of any lien
      upon any of its properties; and




                  (vi) there are no pending or, to its knowledge, threatened
      actions, suits, investigations or proceedings (whether or not purportedly
      on behalf of it) against or affecting it or any of its property before or
      by any court or administrative agency which, if adversely determined, (A)
      would adversely affect the ability of it to perform its obligations under
      this Agreement or (B) would call into question or challenge the validity
      of this Agreement or the enforceability hereof in accordance with the
      terms hereof, nor is the Paying Agent in default with respect to any order
      of any court, governmental authority, arbitration board or administrative
      agency so as to adversely affect its ability to perform its obligations
      under this Agreement.

            SECTION 7.  INDEMNIFICATION. Except for actions expressly required
of the Escrow Agent or the Paying Agent hereunder, each of the Escrow Agent and
the Paying Agent shall in all cases be fully justified in failing or refusing to
act hereunder unless it shall have been indemnified by the party requesting such
action in a manner reasonably satisfactory to it against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. In the event Continental requests any amendment to any
Operative Agreement (as defined in the Note Purchase Agreement), the Pass
Through Trustee agrees to pay all reasonable fees and expenses (including,
without limitation, fees and disbursements of counsel) of the Escrow Agent and
the Paying Agent in connection therewith.

            SECTION 8.  AMENDMENT, ETC. Upon request of the Pass Through Trustee
and approval by an Action of Investors, the Escrow Agent shall enter into an
amendment to this Agreement, so long as such amendment does not adversely affect
the rights or obligations of the Escrow Agent or the Paying Agent, PROVIDED that
upon request of the Pass Through Trustee and without any consent of the
Investors, the Escrow Agent shall enter into an amendment to this Agreement for
any of the following purposes:

                  (1) to correct or supplement any provision in this Agreement
      which may be defective or inconsistent with any other provision herein or
      to cure any ambiguity or correct any mistake or to modify any other
      provision with respect to matters or questions arising under this
      Agreement, PROVIDED that any such action shall not materially adversely
      affect the interests of the Investors; or

                  (2) to comply with any requirement of the SEC, applicable law,
      rules or regulations of any exchange or quotation system on which the
      Certificates are listed or any regulatory body; or

                  (3) to evidence and provide for the acceptance of appointment
      under this Agreement of a successor Escrow Agent, successor Paying Agent
      or successor Pass Through Trustee.

            SECTION 9.  NOTICES. Unless otherwise expressly provided herein, any
notice or other communication under this Agreement shall be in writing
(including by facsimile) and shall be deemed to be given and effective upon
receipt thereof. All notices shall be sent to (a) in the case of the Investors,



as their respective addresses shall appear in the Register, (b) in the case of
the Escrow Agent, Wells Fargo Bank Northwest, National Association, 299 South
Main Street, MAC: U1228-120, Salt Lake City, UT 84111, Attention: Corporate
Trust Services (Telecopier: (801) 246-5053), (c) in the case of the Pass Through
Trustee, Wilmington Trust Company, 1100 North Market Street, Rodney Square
North, Wilmington, DE 19890-1605, Attention: Corporate Capital Market Services
(Telecopier: (302) 636-4140) or (d) in the case of the Paying Agent, Wilmington
Trust Company, 1100 North Market Street, Rodney Square North, Wilmington, DE
19890-1605, Attention: Corporate Capital Market Services (Telecopier: (302)
636-4140), in each case with a copy to Continental, Continental Airlines, Inc.,
1600 Smith Street, Dept. HQS-FN, Houston, TX 77002, Attention: Treasurer
(Telecopier: (713) 324-2447) (or at such other address as any such party may
specify from time to time in a written notice to the other parties). On or prior
to the execution of this Agreement, the Pass Through Trustee has delivered to
the Escrow Agent a certificate containing specimen signatures of the
representatives of the Pass Through Trustee who are authorized to give notices
and instructions with respect to this Agreement. The Escrow Agent may
conclusively rely on such certificate until the Escrow Agent receives written
notice from the Pass Through Trustee to the contrary.

            SECTION 10. TRANSFER. No party hereto shall be entitled to assign or
otherwise transfer this Agreement (or any interest herein) other than (in the
case of the Escrow Agent) to a successor escrow agent under Section 1.06 hereof
or (in the case of the Paying Agent) to a successor paying agent under Section
2.04 hereof, and any purported assignment in violation thereof shall be void.
This Agreement shall be binding upon the parties hereto and their respective
successors and (in the case of the Escrow Agent and the Paying Agent) their
respective permitted assigns.

            SECTION 11. ENTIRE AGREEMENT. This Agreement sets forth all of the
promises, covenants, agreements, conditions and understandings among the Escrow
Agent, the Paying Agent, the Underwriters and the Pass Through Trustee with
respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements and undertakings, inducements or conditions, express
or implied, oral or written.

            SECTION 12. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.

            SECTION 13. WAIVER OF JURY TRIAL RIGHT. EACH OF THE ESCROW AGENT,
THE PAYING AGENT, THE INVESTORS AND THE PASS THROUGH TRUSTEE ACKNOWLEDGES AND
ACCEPTS THAT IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT SUCH PARTY IRREVOCABLY WAIVES ITS RIGHT TO A TRIAL BY JURY.

            SECTION 14. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, all of which taken together shall constitute one instrument.





            IN WITNESS WHEREOF, the Escrow Agent, the Paying Agent, the
Underwriters and the Pass Through Trustee have caused this Escrow and Paying
Agent Agreement to be duly executed as of the day and year first above written.


                                    WELLS FARGO BANK NORTHWEST, NATIONAL
                                    ASSOCIATION,
                                    as Escrow Agent

                                    By
                                      ------------------------------------------
                                      Name:
                                      Title:


                                    CITIGROUP GLOBAL MARKETS INC. and MORGAN
                                    STANLEY & CO. INCORPORATED,
                                       as Underwriters

                                    By:  CITIGROUP GLOBAL MARKETS INC.


                                    By
                                      ------------------------------------------
                                      Name:
                                      Title:



                                    WILMINGTON TRUST COMPANY, not in its
                                    individual capacity, but solely as Pass
                                    Through Trustee


                                    By
                                      ------------------------------------------
                                      Name:
                                      Title:





                                    WILMINGTON TRUST COMPANY,
                                       as Paying Agent


                                    By
                                      ------------------------------------------
                                      Name:
                                      Title:




                                                                       EXHIBIT A

                  CONTINENTAL AIRLINES 2004-ERJ1 ESCROW RECEIPT

                                     No. __

            This Escrow Receipt evidences a fractional undivided interest in
amounts ("ACCOUNT AMOUNTS") from time to time deposited into a certain paying
agent account (the "PAYING AGENT ACCOUNT") described in the Escrow and Paying
Agent Agreement dated as of June 29, 2004 (as amended, modified or supplemented
from time to time, the "ESCROW AND PAYING AGENT AGREEMENT") among Wells Fargo
Bank Northwest, National Association, as Escrow Agent (in such capacity,
together with its successors in such capacity, the "ESCROW AGENT"), Citigroup
Global Markets Inc. and Morgan Stanley & Co. Incorporated, as Underwriters,
Wilmington Trust Company, as Pass Through Trustee (in such capacity, together
with its successors in such capacity, the "PASS THROUGH TRUSTEE") and Wilmington
Trust Company, as paying agent (in such capacity, together with its successors
in such capacity, the "PAYING AGENT"). Capitalized terms not defined herein
shall have the meanings assigned to them in the Escrow and Paying Agent
Agreement.

            This Escrow Receipt is issued under and is subject to the terms,
provisions and conditions of the Escrow and Paying Agent Agreement. By virtue of
its acceptance hereof the holder of this Escrow Receipt assents and agrees to be
bound by the provisions of the Escrow and Paying Agent Agreement and this Escrow
Receipt.

            This Escrow Receipt represents a fractional undivided interest in
amounts deposited from time to time in the Paying Agent Account, and grants or
represents no rights, benefits or interests of any kind in respect of any assets
or property other than such amounts. This Escrow Receipt evidences the same
percentage interest in the Account Amounts as the Fractional Undivided Interest
in the Pass Through Trust evidenced by the Certificate to which this Escrow
Receipt is affixed.

            All payments and distributions made to Receiptholders in respect of
the Escrow Receipt shall be made only from Account Amounts deposited in the
Paying Agent Account. The holder of this Escrow Receipt, by its acceptance of
this Escrow Receipt, agrees that it will look solely to the Account Amounts for
any payment or distribution due to it pursuant to this Escrow Receipt and that
it will not have any recourse to Continental, the Pass Through Trustee, the
Paying Agent or the Escrow Agent, except as expressly provided herein or in the
Pass Through Trust Agreement. No Receiptholder of this Escrow Receipt shall have
any right to vote or in any manner otherwise control the operation and
management of the Paying Agent Account, nor shall anything set forth herein, or
contained in the terms of this Escrow Receipt, be construed so as to constitute
the Receiptholders from time to time as partners or members of an association.

            This Escrow Receipt may not be assigned or transferred except in
connection with the assignment or transfer of the Certificate to which this
Escrow Receipt is affixed. After payment to the holder hereof of its Escrow
Interest in the Final Distribution, upon the request of the Pass Through



Trustee, the holder hereof will return this Escrow Receipt to the Pass Through
Trustee.

            The Paying Agent may treat the person in whose name the Certificate
to which this Escrow Receipt is attached as the owner hereof for all purposes,
and the Paying Agent shall not be affected by any notice to the contrary.

            THIS ESCROW RECEIPT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.






            IN WITNESS WHEREOF, the Escrow Agent has caused this Escrow Receipt
to be duly executed.

Dated:   June __, 2004

                                    WELLS FARGO BANK NORTHWEST, NATIONAL
                                    ASSOCIATION,
                                       as Escrow Agent

                                    By
                                      ------------------------------------------
                                      Name:
                                      Title:





                                                                       EXHIBIT B

                             WITHDRAWAL CERTIFICATE


                Wells Fargo Bank Northwest, National Association
                                 as Escrow Agent

Dear Ladies and Gentlemen:

            Reference is made to the Escrow and Paying Agent Agreement, dated as
of June 29, 2004 (the "Agreement"). We hereby certify to you that the conditions
to the obligations of the undersigned to execute a Participation Agreement
pursuant to the Note Purchase Agreement have been satisfied. Pursuant to Section
1.02(c) of the Agreement, please execute the attached Notice of Purchase
Withdrawal and immediately transmit by facsimile to the Depositary, at (212)
869-7634 (Attention: Brigitte Thieme) and (212) 852-6305 (Attention: Eugene
Chan). Capitalized terms used herein but not defined herein shall have the
meanings set forth in the Agreement.



                                    Very truly yours,

                                    WILMINGTON TRUST COMPANY,
                                    not in its individual capacity but
                                    solely as Pass Through Trustee


                                    By
                                      ------------------------------------------
                                      Name:
                                      Title:



Dated:  ____________, 200_








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



                             NOTE PURCHASE AGREEMENT

                            Dated as of June 29, 2004

                                      Among

                           CONTINENTAL AIRLINES, INC.,

                            WILMINGTON TRUST COMPANY,
                        as Pass Through Trustee under the
                          Pass Through Trust Agreement

                            WILMINGTON TRUST COMPANY,
                             as Subordination Agent

                WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION,
                                 as Escrow Agent

                                       and

                            WILMINGTON TRUST COMPANY,
                                 as Paying Agent







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



                        INDEX TO NOTE PURCHASE AGREEMENT

                                                                            Page

SECTION 1.  Financing of New Aircraft........................................3
SECTION 2.  Conditions Precedent.............................................7
SECTION 3.  Representations and Warranties...................................7
SECTION 4.  Covenants.......................................................12
SECTION 5.  Notices.........................................................13
SECTION 6.  Expenses........................................................13
SECTION 7.  Further Assurances..............................................14
SECTION 8.  Miscellaneous...................................................15
SECTION 9.  Governing Law...................................................16

                                    SCHEDULES

Schedule I.   Aircraft
Schedule II.  Trust Supplement
Schedule III  Mandatory Economic Terms
Schedule IV.  Mandatory Document Terms

                                      ANNEX

Annex A       Definitions

                                    EXHIBITS

Exhibit A     Form of Participation Agreement
Exhibit B     Form of Lease
Exhibit C     Form of Trust Indenture
Exhibit D-1   Form of Purchase Agreement Assignment (Existing Aircraft)
Exhibit D-2   Form of Initial Purchase Agreement Assignment (New Aircraft)
Exhibit D-3   Form of Purchase Agreement Assignment (New Aircraft)
Exhibit E     Form of Trust Agreement
Exhibit F     Form of Delivery Notice



                             NOTE PURCHASE AGREEMENT

            This NOTE PURCHASE AGREEMENT, dated as of June 29, 2004, among (i)
CONTINENTAL AIRLINES, INC., a Delaware corporation (the "COMPANY"), (ii)
WILMINGTON TRUST COMPANY ("WTC"), a Delaware banking corporation, not in its
individual capacity except as otherwise expressly provided herein, but solely as
trustee (in such capacity together with its successors in such capacity, the
"PASS THROUGH TRUSTEE") under the Pass Through Trust Agreement (as defined
below), (iii) WILMINGTON TRUST COMPANY, a Delaware banking corporation, as
subordination agent and trustee (in such capacity together with its successors
in such capacity, the "SUBORDINATION AGENT") under the Intercreditor Agreement
(as defined below), (iv) WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, a
national banking association, as Escrow Agent (in such capacity together with
its successors in such capacity, the "ESCROW Agent"), under the Escrow and
Paying Agent Agreement (as defined below) and (v) WILMINGTON TRUST COMPANY, a
Delaware banking corporation, as Paying Agent (in such capacity together with
its successors in such capacity, the "PAYING AGENT") under the Escrow and Paying
Agent Agreement.

                             W I T N E S S E T H:

            WHEREAS, capitalized terms used but not defined herein shall have
the meanings ascribed to such terms in Annex A hereto;

            WHEREAS, the Company has (i) previously taken delivery of the 11
Embraer EMB-145 XR aircraft listed in Part A of Schedule I hereto (the "EXISTING
AIRCRAFT"), each of which has been leased to the Company pursuant to a separate
lease agreement (collectively, the "EXISTING LEASES") and (ii) obtained
commitments from the Manufacturer pursuant to the Purchase Agreement for the
delivery of the five Embraer EMB-145 XR aircraft listed in Part B of Schedule I
hereto (together with any aircraft substituted therefor in accordance with the
Purchase Agreement, the "NEW AIRCRAFT" and, together with the Existing Aircraft,
the "AIRCRAFT");

            WHEREAS, the Manufacturer, which is obligated to arrange lease
financing of the Aircraft for the Company, wishes to arrange debt financing with
respect to a portion of the purchase price of the Aircraft and, at the request
of the Manufacturer, the Company has entered into this Agreement;



            WHEREAS, pursuant to the Basic Pass Through Trust Agreement and the
Trust Supplement set forth in Schedule II hereto, and concurrently with the
execution and delivery of this Agreement, a grantor trust (the "PASS THROUGH
TRUST") has been created to facilitate certain of the transactions contemplated
hereby, including, without limitation, the issuance and sale of pass through
certificates pursuant thereto (the "CERTIFICATES") to provide for a portion of
the financing of the Aircraft;

            WHEREAS, the Company has entered into the Underwriting Agreement
dated as of June 18, 2004 (the "UNDERWRITING AGREEMENT") with the underwriters
(the "UNDERWRITERS") named therein, which provides that the Company will cause
the Pass Through Trustee to issue and sell the Certificates to the Underwriters
on the Issuance Date;

            WHEREAS, concurrently with the execution and delivery of this
Agreement, (i) the Escrow Agent and the Depositary have entered into a Deposit
Agreement, dated as of the Issuance Date, relating to the Pass Through Trust
(the "DEPOSIT AGREEMENT") whereby the Escrow Agent agreed to direct the
Underwriters to make certain deposits referred to therein on the Issuance Date
(the "INITIAL DEPOSITS") and to permit the Pass Through Trustee to make
additional deposits from time to time thereafter (the Initial Deposits together
with such additional deposits are collectively referred to as the "DEPOSITS")
and (ii) the Pass Through Trustee, the Underwriters, the Paying Agent and the
Escrow Agent have entered into the Escrow and Paying Agent Agreement, dated as
of the Issuance Date, relating to the Pass Through Trust (the "ESCROW AND PAYING
AGENT AGREEMENT") whereby, among other things, (a) the Underwriters agreed to
deliver an amount equal to the amount of the Initial Deposits to the Depositary
on behalf of the Escrow Agent and (b) the Escrow Agent, upon the Depositary
receiving such amount, agreed to deliver escrow receipts to be affixed to each
Certificate;

            WHEREAS, upon receipt of a Delivery Notice with respect to an
Aircraft, subject to the terms and conditions of this Agreement, the Pass
Through Trustee will enter into the applicable Financing Agreements relating to
such Aircraft;

            WHEREAS, upon the financing of each Aircraft, the Pass Through
Trustee will fund its purchase of Equipment Notes with the proceeds of one or
more Deposits withdrawn by the Escrow Agent under the Deposit Agreement (or, if
financed on the Issuance Date, with a portion of the proceeds from the offering
of the Certificates); and



            WHEREAS, concurrently with the execution and delivery of this
Agreement, (i) Citicorp North America, Inc. ("CNAI"), has entered into a
revolving credit agreement for the benefit of the Certificateholders with the
Subordination Agent, as agent for the Pass Through Trustee (the "CNAI LIQUIDITY
FACILITY"), (ii) WestLB AG, New York Branch ("WESTLB" and together with CNAI,
the "LIQUIDITY PROVIDERS"), has entered into a revolving credit agreement for
the benefit of the Certificateholders with the Subordination Agent, as agent for
the Pass Through Trustee (the "WESTLB LIQUIDITY FACILITY" and together with the
CNAI Liquidity Facility, the "LIQUIDITY FACILITIES") and (iii) the Pass Through
Trustee, the Liquidity Provider and the Subordination Agent have entered into
the Intercreditor Agreement, dated as of the date hereof (the "INTERCREDITOR
AGREEMENT");

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

            SECTION 1. FINANCING OF AIRCRAFT. (a) The Company confirms that (i)
it has previously taken delivery of the Existing Aircraft under the Purchase
Agreement and, as of the Issuance Date, leases as lessee the Existing Aircraft
pursuant to the Existing Leases and (ii) ExpressJet Airlines, Inc. has entered
into the Purchase Agreement with the Manufacturer pursuant to which ExpressJet
Airlines, Inc. has agreed to acquire, and the Manufacturer has agreed to
deliver, the New Aircraft in the months specified in Schedule I hereto, all on
and subject to terms and conditions specified in the Purchase Agreement. The
Company agrees to finance the Aircraft in the manner provided herein, all on and
subject to the terms and conditions hereof and of the relevant Financing
Agreements.

            (b) In furtherance of the foregoing, the Company agrees to give the
parties hereto, the Depositary and each of the Rating Agencies not less than two
Business Days' prior notice substantially in the form of Exhibit F hereto (a
"DELIVERY NOTICE") of the scheduled closing date (the "SCHEDULED CLOSING DATE")
(or, in the case of a substitute Delivery Notice under Section 1(e) or (f)
hereof, one Business Day's prior notice) in respect of the financing of each
Aircraft under this Agreement, which notice shall:

            (i) specify the Scheduled Closing Date of such Aircraft (which shall
be a Business Day before the Cut-off Date) on which the financing therefor in
the manner provided herein shall be consummated;



            (ii) instruct the Pass Through Trustee to instruct the Escrow Agent
to provide a Notice of Purchase Withdrawal to the Depositary with respect to the
Equipment Notes to be issued in connection with the financing of such Aircraft
(except in the case of any such financing on the Issuance Date);

            (iii) instruct the Pass Through Trustee to enter into the
Participation Agreement included in the Financing Agreements with respect to
such Aircraft in such form and at such a time on or before the Scheduled Closing
Date specified in such Delivery Notice and to perform its obligations
thereunder; and

            (iv) specify the principal amount of the Equipment Notes to be
issued, and purchased by the Pass Through Trustee, in connection with the
financing of such Aircraft scheduled to be financed on such Scheduled Closing
Date (which shall in all respects comply with the Mandatory Economic Terms).

Notwithstanding the foregoing, in the case of any Aircraft to be financed
hereunder on the Issuance Date, the Delivery Notice therefor may be delivered to
the parties hereto on the Issuance Date.

            (c) Upon receipt of a Delivery Notice, the Pass Through Trustee
shall, and shall cause the Subordination Agent to, enter into and perform their
obligations under the Participation Agreement specified in such Delivery Notice,
PROVIDED that such Participation Agreement and the other Financing Agreements to
be entered into pursuant to such Participation Agreement shall be in the forms
thereof annexed hereto in all material respects with such changes therein as
shall have been agreed upon by the related Owner Participant and the Company
and, if modified in any material respect, as to which Rating Agency Confirmation
shall have been obtained from each Rating Agency by the Company (to be delivered
by the Company to the Pass Through Trustee on or before the relevant Closing
Date, it being understood that if Rating Agency Confirmation shall have been
received with respect to any Financing Agreements and such Financing Agreements
are utilized for subsequent New Aircraft (or Substitute Aircraft) without
material modifications, no additional Rating Agency Confirmation shall be
required); PROVIDED, HOWEVER, that the relevant Financing Agreements as executed
and delivered shall not vary the Mandatory Economic Terms and shall contain the
Mandatory Document Terms. The Company shall pay the reasonable costs and



expenses of the Rating Agencies in connection with obtaining any such Rating
Agency Confirmation. With respect to each Aircraft, the Company shall cause WTC
(or such other person that meets the eligibility requirements to act as loan
trustee under the Trust Indenture) to execute as Loan Trustee the Financing
Agreements relating to such Aircraft to which such Loan Trustee is intended to
be a party, and shall concurrently therewith execute such Financing Agreements
to which the Company is intended to be a party and perform its respective
obligations thereunder. Upon the request of either Rating Agency, the Company
shall deliver or cause to be delivered to each Rating Agency a true and complete
copy of each Financing Agreement relating to the financing of each Aircraft
together with a true and complete set of the closing documentation (including
legal opinions) delivered to the related Loan Trustee, Subordination Agent and
Pass Through Trustee under the related Participation Agreement.

            (d) [Intentionally omitted.]

            (e) If after giving any Delivery Notice, there shall be a delay in
the delivery of the New Aircraft referred to therein, or if on the Scheduled
Closing Date of an Aircraft the financing thereof in the manner contemplated
hereby shall not be consummated for whatever reason, the Company shall give the
parties hereto prompt notice thereof. Concurrently with the giving of such
notice of postponement or subsequently, the Company shall give the parties
hereto a substitute Delivery Notice specifying the date to which the financing
of such Aircraft shall have been re-scheduled (which shall be a Business Day
before the Cut-off Date on which the Escrow Agent shall be entitled to withdraw
one or more Deposits under the Deposit Agreement to enable the Pass Through
Trustee to fund its purchase of the related Equipment Notes). Upon receipt of
any such notice of postponement, the Pass Through Trustee shall comply with its
obligations under Section 5.01 of the Trust Supplement and thereafter the
financing of such Aircraft, as specified in such substitute Delivery Notice,
shall take place on the re-scheduled closing date therefor (all on and subject
to the terms and conditions of the relevant Financing Agreements) unless further
postponed as provided herein.

            (f) Anything in this Section 1 to the contrary notwithstanding, the
Company shall have the right to accept delivery of a New Aircraft under the
Purchase Agreement on the Delivery Date thereof by utilization of bridge
financing of such New Aircraft and promptly thereafter give the parties hereto a
Delivery Notice specifying a Scheduled Closing Date not later than 90 days after



the Delivery Date of such New Aircraft and no later than the Cut-off Date and
otherwise complying with the provisions of Section 1(b) hereof. All other terms
and conditions of this Note Purchase Agreement shall apply to the financing of
any such New Aircraft on the re-scheduled closing date therefor except (i) the
re-scheduled closing date shall be deemed the Delivery Date of such New Aircraft
for all purposes of this Section 1 and (ii) the related Financing Agreements
shall be amended to reflect the original delivery of such New Aircraft to the
Company.

            (g) If the scheduled Delivery Date for any New Aircraft is delayed
(a) more than 30 days beyond the last day of the month set forth opposite such
New Aircraft under the heading "Scheduled Delivery Month" in Schedule I hereto
or (b) beyond December 31, 2004, the Company may identify for delivery a
substitute aircraft therefor meeting the following conditions (a "SUBSTITUTE
AIRCRAFT"): (i) a Substitute Aircraft must be an Embraer EMB-145 XR aircraft
manufactured after the date of this Agreement and (ii) the Company shall be
obligated to obtain Rating Agency Confirmation in respect of the replacement of
any New Aircraft by Substitute Aircraft. Upon the satisfaction of the conditions
set forth above with respect to a Substitute Aircraft, the New Aircraft to be
replaced shall cease to be subject to this Agreement and all rights and
obligations of the parties hereto concerning such New Aircraft shall cease, and
such Substitute Aircraft shall become and thereafter be subject to the terms and
conditions of this Agreement to the same extent as such New Aircraft.

            (h) The Company shall have no liability for the failure of the Pass
Through Trustee to purchase Equipment Notes with respect to any Aircraft or
Substitute Aircraft.

            (i) The parties agree that if, in connection with the financing of a
New Aircraft or Substitute Aircraft, any Owner Participant who is to be a party
to any Financing Agreement shall be a "Citizen of the United States" within the
meaning of Section 40102(a)(15) of the Act, then the applicable Financing
Agreements may be modified, consistent with the Mandatory Document Terms, to
eliminate the restrictions on the Owner Participant's right to control the Owner
Trustee and to make other customary changes to reflect that the Owner
Participant is a "Citizen of the United States".

            (j) Anything herein to the contrary notwithstanding, the Company
shall not have the right, and shall not be entitled, at any time to request the
issuance of Equipment Notes to the Pass Through Trustee in an aggregate



principal amount in excess of the amount of the Deposits then available for
withdrawal by the Escrow Agent under and in accordance with the provisions of
the Deposit Agreement.

            SECTION 2. CONDITIONS PRECEDENT. The obligation of the Pass Through
Trustee to enter into, and to cause the Subordination Agent to enter into, any
Participation Agreement as directed pursuant to a Delivery Notice and to perform
its obligations thereunder is subject to satisfaction of the following
conditions:

            (a) no Triggering Event shall have occurred; and

            (b) the Company shall have delivered a certificate to such Pass
Through Trustee and the Liquidity Providers stating that (i) such Participation
Agreement and the other Financing Agreements to be entered into pursuant to such
Participation Agreement do not vary the Mandatory Economic Terms and contain the
Mandatory Document Terms and (ii) any substantive modification of such Financing
Agreements from the forms of Financing Agreements attached to this Agreement do
not materially and adversely affect the Certificateholders, and such
certification shall be true and correct.

            Anything herein to the contrary notwithstanding, the obligation of
the Pass Through Trustee to purchase Equipment Notes shall terminate on the
Cut-off Date.

            SECTION 3.  REPRESENTATIONS AND WARRANTIES.  (a)  The Company
represents and warrants that:

                  (i) the Company is duly incorporated, validly existing and in
            good standing under the laws of the State of Delaware and is a
            "citizen of the United States" as defined in Section 40102(a)(15) of
            the Act, and has the full corporate power, authority and legal right
            under the laws of the State of Delaware to execute and deliver this
            Agreement and each Financing Agreement to which it will be a party
            and to carry out the obligations of the Company under this Agreement
            and each Financing Agreement to which it will be a party;

                  (ii) the execution and delivery by the Company of this
            Agreement and the performance by the Company of its obligations
            under this Agreement have been duly authorized by the Company and
            will not violate its Certificate of Incorporation or by-laws or the



            provisions of any indenture, mortgage, contract or other agreement
            to which it is a party or by which it is bound; and

                  (iii) this Agreement constitutes the legal, valid and binding
            obligation of the Company, enforceable against it in accordance with
            its terms, except as the same may be limited by applicable
            bankruptcy, insolvency, reorganization, moratorium or similar laws
            affecting the rights of creditors generally and by general
            principles of equity, whether considered in a proceeding at law or
            in equity.

            (b) WTC represents and warrants that:

                  (i) WTC is duly incorporated, validly existing and in good
            standing under the laws of the State of Delaware and is a "citizen
            of the United States" as defined in Section 40102(a)(15) of the Act,
            and has the full corporate power, authority and legal right under
            the laws of the State of Delaware and the United States pertaining
            to its banking, trust and fiduciary powers to execute and deliver
            this Agreement and each Financing Agreement to which it will be a
            party and to carry out the obligations of WTC, in its capacity as
            Subordination Agent, Pass Through Trustee or Paying Agent, as the
            case may be, under this Agreement and each Financing Agreement to
            which it will be a party;

                  (ii) the execution and delivery by WTC, in its capacity as
            Subordination Agent, Pass Through Trustee or Paying Agent, as the
            case may be, of this Agreement and the performance by WTC, in its
            capacity as Subordination Agent, Pass Through Trustee or Paying
            Agent, as the case may be, of its obligations under this Agreement
            have been duly authorized by WTC, in its capacity as Subordination
            Agent, Pass Through Trustee or Paying Agent, as the case may be, and
            will not violate its articles of association or by-laws or the
            provisions of any indenture, mortgage, contract or other agreement
            to which it is a party or by which it is bound; and

                  (iii) this Agreement constitutes the legal, valid and binding
            obligations of WTC, in its capacity as Subordination Agent, Pass
            Through Trustee or Paying Agent, as the case may be, enforceable



            against it in accordance with its terms, except as the same may be
            limited by applicable bankruptcy, insolvency, reorganization,
            moratorium or similar laws affecting the rights of creditors
            generally and by general principles of equity, whether considered in
            a proceeding at law or in equity.

            (c) The Pass Through Trustee hereby confirms to each of the other
parties hereto that its representations and warranties set forth in Section 7.15
of the Basic Pass Through Trust Agreement and Section 5.04 of the Trust
Supplement are true and correct as of the date hereof.

            (d) The Subordination Agent represents and warrants that:

                  (i) the Subordination Agent is duly incorporated, validly
            existing and in good standing under the laws of the State of
            Delaware, and has the full corporate power, authority and legal
            right under the laws of the State of Delaware and the United States
            pertaining to its banking, trust and fiduciary powers to execute and
            deliver this Agreement and each Financing Agreement to which it is
            or will be a party and to perform its obligations under this
            Agreement and each Financing Agreement to which it is or will be a
            party;

                  (ii) this Agreement has been duly authorized, executed and
            delivered by the Subordination Agent; this Agreement constitutes the
            legal, valid and binding obligations of the Subordination Agent
            enforceable against it in accordance with its terms, except as the
            same may be limited by applicable bankruptcy, insolvency,
            reorganization, moratorium or similar laws affecting the rights of
            creditors generally and by general principles of equity, whether
            considered in a proceeding at law or in equity;

                  (iii) none of the execution, delivery and performance by the
            Subordination Agent of this Agreement contravenes any law, rule or
            regulation of the State of Delaware or any United States
            governmental authority or agency regulating the Subordination
            Agent's banking, trust or fiduciary powers or any judgment or order
            applicable to or binding on the Subordination Agent and do not
            contravene the Subordination Agent's articles of association or



            by-laws or result in any breach of, or constitute a default under,
            any agreement or instrument to which the Subordination Agent is a
            party or by which it or any of its properties may be bound;

                  (iv) neither the execution and delivery by the Subordination
            Agent of this Agreement nor the consummation by the Subordination
            Agent of any of the transactions contemplated hereby requires the
            consent or approval of, the giving of notice to, the registration
            with, or the taking of any other action with respect to, any
            Delaware governmental authority or agency or any federal
            governmental authority or agency regulating the Subordination
            Agent's banking, trust or fiduciary powers;

                  (v) there are no Taxes payable by the Subordination Agent
            imposed by the State of Delaware or any political subdivision or
            taxing authority thereof in connection with the execution, delivery
            and performance by the Subordination Agent of this Agreement (other
            than franchise or other taxes based on or measured by any fees or
            compensation received by the Subordination Agent for services
            rendered in connection with the transactions contemplated by the
            Intercreditor Agreement or any of the Liquidity Facilities), and
            there are no Taxes payable by the Subordination Agent imposed by the
            State of Delaware or any political subdivision thereof in connection
            with the acquisition, possession or ownership by the Subordination
            Agent of any of the Equipment Notes (other than franchise or other
            taxes based on or measured by any fees or compensation received by
            the Subordination Agent for services rendered in connection with the
            transactions contemplated by the Intercreditor Agreement or any of
            the Liquidity Facilities); and

                  (vi) there are no pending or threatened actions or proceedings
            against the Subordination Agent before any court or administrative
            agency which individually or in the aggregate, if determined
            adversely to it, would materially adversely affect the ability of
            the Subordination Agent to perform its obligations under this
            Agreement.



            (e) The Escrow Agent represents and warrants that:

                  (i) the Escrow Agent is a national banking association duly
            incorporated, validly existing and in good standing under the laws
            of the United States and has the full corporate power, authority and
            legal right under the laws of the United States pertaining to its
            banking, trust and fiduciary powers to execute and deliver this
            Agreement, the Deposit Agreement and the Escrow and Paying Agent
            Agreement (collectively, the "ESCROW AGENT AGREEMENTS") and to carry
            out the obligations of the Escrow Agent under each of the Escrow
            Agent Agreements;

                  (ii) the execution and delivery by the Escrow Agent of each of
            the Escrow Agent Agreements and the performance by the Escrow Agent
            of its obligations hereunder and thereunder have been duly
            authorized by the Escrow Agent and will not violate its articles of
            association or by-laws or the provisions of any indenture, mortgage,
            contract or other agreement to which it is a party or by which it is
            bound; and

                  (iii) each of the Escrow Agent Agreements constitutes the
            legal, valid and binding obligations of the Escrow Agent enforceable
            against it in accordance with its terms, except as the same may be
            limited by applicable bankruptcy, insolvency, reorganization,
            moratorium or similar laws affecting the rights of creditors
            generally and by general principles of equity, whether considered in
            a proceeding at law or in equity.

            (f) The Paying Agent represents and warrants that:

                  (i) the Paying Agent is duly incorporated, validly existing
            and in good standing under the laws of the State of Delaware and has
            the full corporate power, authority and legal right under the laws
            of the United States pertaining to its banking, trust and fiduciary
            powers to execute and deliver this Agreement and the Escrow and
            Paying Agent Agreement (collectively, the "PAYING AGENT AGREEMENTS")
            and to carry out the obligations of the Paying Agent under each of
            the Paying Agent Agreements;

                  (ii) the execution and delivery by the Paying Agent of each of
            the Paying Agent Agreements and the performance by the Paying Agent
            of its obligations hereunder and thereunder have been duly



            authorized by the Paying Agent and will not violate its articles of
            association or by-laws or the provisions of any indenture, mortgage,
            contract or other agreement to which it is a party or by which it is
            bound; and

                  (iii) each of the Paying Agent Agreements constitutes the
            legal, valid and binding obligations of the Paying Agent enforceable
            against it in accordance with its terms, except as the same may be
            limited by applicable bankruptcy, insolvency, reorganization,
            moratorium or similar laws affecting the rights of creditors
            generally and by general principles of equity, whether considered in
            a proceeding at law or in equity.

            SECTION 4.  COVENANTS.  (a)  The Company covenants with each of
the other parties hereto that:

            (i) [Intentionally omitted.]

            (ii) subject to Section 4(a)(iv) of this Agreement, the Company
shall at all times maintain its corporate existence and shall not wind up,
liquidate or dissolve or take any action, or fail to take any action, that would
have the effect of any of the foregoing;

            (iii) the Company shall at all times remain a U.S. Air Carrier (as
defined in the Financing Agreements) and shall at all times be otherwise
certificated and registered to the extent necessary to entitle the Owner Trustee
(and the Loan Trustee as assignee of the Owner Trustee's rights under each
Lease) to the rights afforded to lessors of aircraft equipment under Section
1110;

            (iv) Section 13.2.1 of each Lease is hereby incorporated by
reference herein;

            (v) the Company agrees to provide written notice to each of the
parties hereto of the occurrence of the Cut-off Date no later than one Business
Day after the date thereof.

            (b) WTC, in its individual capacity, covenants with each of the
other parties to this Agreement that it will, immediately upon obtaining
knowledge of any facts that would cast doubt upon its continuing status as a
"citizen of the United States" as defined in Section 40102(a)(15) of the Act and
promptly upon public disclosure of negotiations in respect of any transaction



which would or might adversely affect such status, notify in writing all parties
hereto of all relevant matters in connection therewith. Upon WTC giving any such
notice, WTC shall, subject to Section 8.02 of any Trust Indenture then entered
into, resign as Loan Trustee in respect of such Trust Indenture.

            SECTION 5. NOTICES. Unless otherwise specifically provided herein,
all notices required or permitted by the terms of this Agreement shall be in
English and in writing, and any such notice shall become effective upon being
delivered personally or, if promptly confirmed by mail, when dispatched by
facsimile or other written telecommunication, addressed to such party hereto at
its address or facsimile number set forth below the signature of such party at
the foot of this Agreement or to such other address or facsimile number as such
party may hereafter specify by notice to the other parties.

            SECTION 6. EXPENSES. (a) The Company agrees to pay to the
Subordination Agent when due, to the extent not paid when due by the
Manufacturer, an amount or amounts equal to the fees payable to the Liquidity
Providers under Section 2.03 of each Liquidity Facility and the related Fee
Letter (as defined in the Intercreditor Agreement) multiplied by a fraction the
numerator of which shall be the then outstanding aggregate amount of the
Deposits under the Deposit Agreement and the denominator of which shall be the
sum of (x) the then outstanding aggregate principal amount of the Equipment
Notes issued under all of the Trust Indentures and (y) the then outstanding
aggregate amount of the Deposits under the Deposit Agreement.

            (b) So long as no Equipment Notes have been issued in respect of any
Aircraft, the Company agrees to pay (i) to the Subordination Agent when due, to
the extent not paid when due by the Manufacturer, (A) the amount equal to
interest on any Downgrade Advance (other than any Applied Downgrade Advance)
payable under Section 3.07 of each Liquidity Facility minus Investment Earnings
while such Downgrade Advance shall be outstanding, (B) the amount equal to
interest on any CNAI Special Termination Advance (other than any Applied CNAI
Special Termination Advance) payable under Section 3.07 of the CNAI Liquidity
Facility minus Investment Earnings from such CNAI Special Termination Advance,
(C) the amount equal to interest on any WestLB Expiration Advance (other than
any Applied WestLB Expiration Advance) payable under Section 3.07 of the WestLB
Liquidity Facility minus Investment Earnings from such WestLB Expiration
Advance; (D) the amount equal to interest on any Non-Extension Advance (other



than any Applied Non-Extension Advance) payable under Section 3.07 of the CNAI
Liquidity Facility minus Investment Earnings from such Non-Extension Advance;
(E) the amount equal to interest on any WestLB Early Termination Advance (other
than any Applied WestLB Early Termination Advance) payable under Section 3.07 of
the WestLB Liquidity Facility minus Investment Earnings from such WestLB Early
Termination Advance; (F) any other amounts owed to the Liquidity Providers by
the Subordination Agent as borrower under the Liquidity Facilities (other than
amounts due as repayment of advances thereunder or as interest on such advances,
except to the extent payable pursuant to clause (A) or (B)), (ii) all
compensation and reimbursement of expenses, disbursements and advances payable
by the Company under the Pass Through Trust Agreements, (iii) all compensation
and reimbursement of expenses and disbursements payable to the Subordination
Agent under the Intercreditor Agreement except with respect to any income or
franchise taxes incurred by the Subordination Agent in connection with the
transactions contemplated by the Intercreditor Agreement and (iv) in the event
the Company requests any amendment to any Operative Agreement, all reasonable
fees and expenses (including, without limitation, fees and disbursements of
counsel) of the Escrow Agent and/or the Paying Agent in connection therewith.
For purposes of this Section 6(b), (i) the terms "Applied Downgrade Advance",
"Cash Collateral Account", "Downgrade Advance", "Final Advance", "Investment
Earnings" and "Unpaid Advance" shall have the meanings specified in each
Liquidity Facility, (ii) the terms "Applied WestLB Early Termination Advance",
"Applied WestLB Expiration Advance", "West LB Expiration Advance" and "WestLB
Early Termination Advance" shall have the meanings specified in the WestLB
Liquidity Facility and (iii) the terms "Applied Non-Extension Advance", "Applied
CNAI Special Termination Advance", "Non-Extension Advance" and "CNAI Special
Termination Advance" shall have the meanings specified in the CNAI Liquidity
Facility.

            SECTION 7. FURTHER ASSURANCES. Each party hereto shall duly execute,
acknowledge and deliver, or shall cause to be executed, acknowledged and
delivered, all such further agreements, instruments, certificates or documents,
and shall do and cause to be done such further acts and things, in any case, as
any other party hereto shall reasonably request in connection with its
administration of, or to carry out more effectually the purposes of, or to
better assure and confirm unto it the rights and benefits to be provided under,
this Agreement.



            SECTION 8. MISCELLANEOUS. (a) Provided that the transactions
contemplated hereby have been consummated, and except as otherwise provided for
herein, the representations, warranties and agreements herein of the Company,
the Subordination Agent, the Escrow Agent, the Paying Agent and the Pass Through
Trustee, and the Company's, the Subordination Agent's, the Escrow Agent's, the
Paying Agent's and the Pass Through Trustee's obligations under any and all
thereof, shall survive the expiration or other termination of this Agreement and
the other agreements referred to herein.

            (b) This Agreement may be executed in any number of counterparts
(and each of the parties hereto shall not be required to execute the same
counterpart). Each counterpart of this Agreement, including a signature page
executed by each of the parties hereto, shall be an original counterpart of this
Agreement, but all of such counterparts together shall constitute one
instrument. Neither this Agreement nor any of the terms hereof may be
terminated, amended, supplemented, waived or modified orally, but only by an
instrument in writing signed by the party against which the enforcement of the
termination, amendment, supplement, waiver or modification is sought. The index
preceding this Agreement and the headings of the various Sections of this
Agreement are for convenience of reference only and shall not modify, define,
expand or limit any of the terms or provisions hereof. The terms of this
Agreement shall be binding upon, and shall inure to the benefit of, the Company
and its successors and permitted assigns, the Pass Through Trustee and its
successors as Pass Through Trustee (and any additional trustee appointed) under
any of the Pass Through Trust Agreements, the Escrow Agent and its successors as
Escrow Agent under the Escrow and Paying Agent Agreement, the Paying Agent and
its successors as Paying Agent under the Escrow and Paying Agent Agreement and
the Subordination Agent and its successors as Subordination Agent under the
Intercreditor Agreement.

            (c) This Agreement is not intended to, and shall not, provide any
person not a party hereto (other than the Underwriters and each of the
beneficiaries of Section 6 hereof) with any rights of any nature whatsoever
against any of the parties hereto, and no person not a party hereto (other than
the Underwriters and each of the beneficiaries of Section 6 hereof) shall have
any right, power or privilege in respect of, or have any benefit or interest
arising out of, this Agreement.



            SECTION 9. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. THIS AGREEMENT
IS BEING DELIVERED IN THE STATE OF NEW YORK.



            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.

                                    CONTINENTAL AIRLINES, INC.



                                    By
                                       ---------------------------------------
                                       Name:
                                       Title:

                                    Address:    1600 Smith Street, HQSFN
                                                Houston, TX  77002
                                                Attention:  Treasurer
                                                Facsimile:  (713) 324-2447

                                    WILMINGTON TRUST COMPANY, not in its
                                    individual capacity, except as otherwise
                                    provided herein, but solely as Pass Through
                                    Trustee



                                    By
                                      ----------------------------------------
                                      Name:
                                      Title:

                                    Address:   Rodney Square North
                                               1100 North Market Street
                                               Wilmington, Delaware 19890
                                               Attention: Corporate Trust
                                               Administration
                                               Facsimile:  (302) 651-8882



                                    WILMINGTON TRUST COMPANY, not in its
                                    individual capacity, except as otherwise
                                    provided herein, but solely as Subordination
                                    Agent



                                    By
                                      ----------------------------------------
                                      Name:
                                      Title:

                                    Address:   Rodney Square North
                                               1100 North Market Street
                                               Wilmington, Delaware 19890
                                               Attention: Corporate Trust
                                               Administration
                                               Facsimile:  (302) 651-8882


                                    WELLS FARGO BANK NORTHWEST, NATIONAL
                                    ASSOCIATION,
                                    as Escrow Agent



                                    By
                                      ----------------------------------------
                                      Name:
                                      Title:

                                    Address:   MAC:  U1228-120
                                               299 South Main Street
                                               12th Floor
                                               Salt Lake City, Utah 84111
                                               Attention: Corporate Trust
                                               Services
                                               Facsimile:  (801) 246-5053



                                    WILMINGTON TRUST COMPANY,
                                    as Paying Agent



                                    By
                                      ----------------------------------------
                                      Name:
                                      Title:

                                    Address:   Rodney Square North
                                               1100 North Market Street
                                               Wilmington, Delaware 19890
                                               Attention: Corporate Trust
                                               Administration
                                               Facsimile:  (302) 651-8882



                                  SCHEDULE I to
                             NOTE PURCHASE AGREEMENT

                                    AIRCRAFT

                 PART A - EXISTING AIRCRAFT

   Registration       Manufacturer's        Scheduled
      Number           Serial Number      Delivery Month
- ------------------- ------------------ -------------------
      N11155             145782            Previously
                                           Delivered

      N10156             145786            Previously
                                           Delivered

      N12157             145787            Previously
                                           Delivered

      N14158             145791            Previously
                                           Delivered

      N17159             145792            Previously
                                           Delivered

      N12160             145799            Previously
                                           Delivered

      N13161            14500805           Previously
                                           Delivered

      N14162            14500808           Previously
                                           Delivered

      N12163            14500811           Previously
                                           Delivered

      N11164            14500817           Previously
                                           Delivered

      N11165            14500819           Previously
                                           Delivered

                   PART B - NEW AIRCRAFT

      N12166            14500831           July 2004

      N12167            14500834           July 2004

      N14168            14500840          August 2004

      N17169            14500844          August 2004

      N16170            14500850         September 2004



                                 SCHEDULE II to
                             NOTE PURCHASE AGREEMENT

                                TRUST SUPPLEMENT

Trust Supplement dated as of the Issuance Date between the Company and the Pass
Through Trustee in respect of the Continental Airlines Class A Pass Through
Trust, Series 2004-ERJ1.



                                 Schedule III to
                             NOTE PURCHASE AGREEMENT

                            MANDATORY ECONOMIC TERMS

      o     The aggregate principal amount of the Equipment Notes issued with
            respect to an Aircraft shall not exceed the amounts set forth in the
            following table:

    AIRCRAFT
  REGISTRATION      MANUFACTURER'S          PRINCIPAL AMOUNT
      NUMBER        SERIAL NUMBER          OF EQUIPMENT NOTES
  ------------      --------------         ------------------

      N11155            145782                $10,745,972
      N10156            145786                 10,686,554
      N12157            145787                 10,692,100
      N14158            145791                 10,571,853
      N17159            145792                 10,598,759
      N12160            145799                 10,926,373
      N13161           14500805                11,062,500
      N14162           14500808                11,348,468
      N12163           14500811                10,748,893
      N11164           14500817                10,822,420
      N11165           14500819                11,013,029
      N12166           14500831                11,096,335
      N12167           14500834                11,096,335
      N14168           14500840                11,149,043
      N17169           14500844                11,152,077
      N16170           14500850                11,150,989

      o     The Loan to Aircraft Value for the Equipment Notes issued for each
            Aircraft computed on the date of issuance thereof (with value for
            such Aircraft for these purposes initially equal to its value set
            forth under "Description of the Aircraft and the Appraisals--The
            Appraisals" in the column "Appraised Value" in the Prospectus
            Supplement and thereafter based on such value after giving effect to
            the Depreciation Assumption (as defined in the Prospectus
            Supplement)) as of the issuance date of such Equipment Notes and any
            Regular Distribution Date thereafter (assuming no default in the
            payment of the Equipment Notes and after giving effect to scheduled
            payments) will not exceed 56.5%.

      o     The initial average life of the Equipment Notes for any Aircraft
            shall not extend beyond 10 years from the Issuance Date.

      o     As of the Delivery Period Termination Date, the average life of the
            Certificates shall not be more than 9.8 years from the Issuance Date



            (computed without regard to the acceleration of any Equipment Notes
            and after giving effect to any special distribution on the
            Certificates thereafter required in respect of unused Deposits).

      o     The final expected distribution date of the Certificates shall be as
            set forth on the cover page of the Prospectus Supplement.

      o     The original aggregate principal amount of all of the Equipment
            Notes shall not exceed the original aggregate face amount of the
            Certificates.

      o     The interest rate applicable to the Equipment Notes must be equal to
            the rate applicable to the Certificates.

      o     The payment dates for the Equipment Notes must be on the first day
            of each month after July 1, 2004, and basic rent under the Leases
            must be payable on such dates.

      o     Basic rent, stipulated loss values and termination values under the
            Leases must be sufficient to pay amounts due with respect to the
            related Equipment Notes.

      o     The amounts payable under the all-risk aircraft hull insurance
            maintained with respect to each Aircraft must be sufficient to pay
            the applicable stipulated loss value, subject to certain rights of
            self-insurance.

      o     (a) The past due rate in the Trust Indentures and the Leases, (b)
            the "Make-Whole Amount" payable under the Trust Indentures, (c) the
            provisions relating to the redemption and purchase of Equipment
            Notes in the Trust Indentures, (d) the minimum liability insurance
            amount on Aircraft in the Leases, and (e) the indemnification of the
            Loan Trustees, Subordination Agent, Liquidity Providers, Pass
            Through Trustee, Escrow Agent and registered holders of the
            Equipment Notes with respect to certain taxes and expenses, in each
            case shall be provided as set forth in the forms of Participation
            Agreements, Lease and Trust Indentures attached as exhibits to the
            Note Purchase Agreement.



                                 SCHEDULE IV TO
                             NOTE PURCHASE AGREEMENT

                            MANDATORY DOCUMENT TERMS

The terms "Form of Participation Agreement" "Form of Lease" and "Form of Trust
Indenture" correspond to Exhibits A, B and C of the Note Purchase Agreement.

1.    May not modify in any material adverse respect the Granting Clause of the
      Form of Trust Indenture so as to deprive the Note Holders of a first
      priority security interest in and mortgage lien on the Aircraft and the
      Lease or to eliminate any of the obligations secured thereby or otherwise
      modify in any material adverse respect as regards the interests of the
      Note Holders, the Subordination Agent, the Liquidity Providers or the
      Mortgagee the provisions of Article II or III or Section 4.02, 4.03, 4.04,
      5.02, 5.06, 9.01(b), 10.04, 10.11 or 10.12 of the Form of Trust Indenture.

2.    May not modify in any material adverse respect as regards the interests of
      the Note Holders, the Subordination Agent, the Liquidity Providers or the
      Mortgagee the provisions of Section 3.2.1(b), 3.3(c), 4.7, the final
      sentence of 7.1.1, 10.3.1(d)(ii), 13.3, 16, 18.3 or 18.7(a) of the Form of
      Lease or otherwise modify the terms of the Form of Lease so as to deprive
      the Mortgagee of rights expressly granted to the "Mortgagee" therein.

3.    May not modify in any material adverse respect as regards the interests of
      the Note Holders, the Subordination Agent, the Liquidity Providers or the
      Mortgagee the provisions of Section 5.1.9, 5.1.10, 5.1.11, 5.1.12, 7.5,
      12, 15.8(a) or 15.9 of the Form of Participation Agreement or of the
      provisions of Section 5.1.2(xxv) or 10.1.1(a)(iv) of the Form of
      Participation Agreement so as to eliminate the requirement to deliver to
      the Loan Participant or the Mortgagee, as the case may be, the legal
      opinions to be provided to such Persons thereunder (recognizing that the
      lawyers rendering such opinions may be changed) or of the provisions of
      Section 7.6.11(a)(ii) of the Form of Participation Agreement as regards
      the rights of the Mortgagee thereunder or otherwise modify the terms of
      the Form of Participation Agreement to deprive the Note Holders, the
      Subordination Agent, the Liquidity Providers or the Mortgagee of any
      indemnity or right of reimbursement in its favor for Expenses or Taxes.



4.    May not modify, in any material adverse respect as regards the interests
      of the Note Holders, the Subordination Agent, the Liquidity Providers or
      the Mortgagee, the definition of "Make Whole Amount" in Annex A to the
      Participation Agreement Form.

      Notwithstanding the foregoing, any such Mandatory Document Term may be
      modified to correct or supplement any such provision which may be
      defective or to cure any ambiguity or correct any mistake, PROVIDED that
      any such action shall not materially adversely affect the interests of the
      Note Holders, the Subordination Agent, the Liquidity Providers, the
      Mortgagee or the Certificateholders.



                                   ANNEX A to
                             NOTE PURCHASE AGREEMENT

                                   DEFINITIONS

"ACT" means part A of subtitle VII of title 49, United States Code.

"AFFILIATE" means, with respect to any person, any other person directly or
indirectly controlling, controlled by or under common control with such person.
For 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 "controlling," "controlled by" and "under common control with"
have correlative meanings.

"AIRCRAFT" has the meaning set forth in the second recital to the Note Purchase
Agreement.

"ASSUMED AMORTIZATION SCHEDULE" means the amortization schedule set forth on
page S-32 of the Prospectus Supplement.

"AVERAGE LIFE DATE" means, for any Equipment Note, the date which follows the
time of determination by a period equal to the Remaining Weighted Average Life
of such Equipment Note.

"BANKRUPTCY CODE" means the United States Bankruptcy Code, 11 U.S.C. ss.ss. 101
ET SEQ.

"BASIC PASS THROUGH TRUST AGREEMENT" means the Pass Through Trust Agreement,
dated September 25, 1997, between the Company and Pass Through Trustee, as such
agreement may be supplemented, amended or modified, but does not include the
Trust Supplement.

"BUSINESS DAY" means any day, other than a Saturday, Sunday or other day on
which commercial banks are authorized or required by law to close in New York,
New York, Houston, Texas, Wilmington, Delaware or Salt Lake City, Utah.

"CERTIFICATES" has the meaning set forth in the fourth recital to the Note
Purchase Agreement.

"CERTIFICATEHOLDER" means the Person in whose name a Certificate is registered
in the Register.



"COMPANY" means Continental Airlines, Inc., a Delaware corporation.

"CORPORATE TRUST OFFICE" with respect to the Pass Through Trustee or any Loan
Trustee, means 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 the earlier of (a) the day after the Delivery Period
Termination Date and (b) the date on which a Triggering Event occurs.

"DELIVERY PERIOD TERMINATION DATE" means the earlier of (a) December 31, 2004,
or, if the Equipment Notes relating to all of the New Aircraft (or Substitute
Aircraft in lieu thereof) have not been purchased by the Pass Through Trustee on
or prior to such date due to any reason beyond the control of the Company and
not occasioned by the Company's fault or negligence, March 31, 2005 and (b) the
date on which Equipment Notes issued with respect to all of the Aircraft (or
Substitute Aircraft in lieu thereof) have been purchased by the Pass Through
Trustee in accordance with the Note Purchase Agreement.

"DELIVERY DATE" means the Business Day on which a New Aircraft is delivered to
and accepted by the Company.

"DELIVERY NOTICE" means a Delivery Notice substantially in the form of Exhibit F
to the Note Purchase Agreement.

"DEPOSIT" has the meaning set forth in the sixth recital to the Note Purchase
Agreement.

"DEPOSIT AGREEMENT" has the meaning set forth in the sixth recital to the Note
Purchase Agreement.

"DEPOSITARY" means WestLB AG, New York Branch.

"EQUIPMENT NOTES" means and includes any equipment notes issued under any Trust
Indenture in the form specified in Section 2.01 thereof (as such form may be
varied pursuant to the terms of such Trust Indenture) and any Equipment Note
issued under any Trust Indenture in exchange for or replacement of any other
Equipment Note.

"ESCROW AGENT" has the meaning set forth in the first paragraph of the Note
Purchase Agreement.



"ESCROW AGENT AGREEMENTS" has the meaning set forth in Section 3(e)(i) of the
Note Purchase Agreement.

"ESCROW AND PAYING AGENT AGREEMENT" has the meaning set forth in the fifth
recital to the Note Purchase Agreement.

"EXISTING AIRCRAFT" has the meaning set forth in the second recital to the Note
Purchase Agreement.

"EXISTING LEASES" has the meaning set forth in the second recital to the Note
Purchase Agreement.

"FAA" means the Federal Aviation Administration of the United States.

"FINAL WITHDRAWAL" with respect to the Escrow and Paying Agent Agreement, has
the meaning set forth in Section 1.02 thereof.

"FINANCING AGREEMENTS" means, collectively, the Purchase Agreement Assignment,
the Initial Purchase Agreement Assignment (if a New Aircraft), the Participation
Agreement, the Lease, the Trust Indenture, the Equipment Notes issued
thereunder, and the Trust Agreement relating to the financing of an Aircraft.

"GOVERNMENT ENTITY" means (a) any federal, state, provincial or similar
government, and any body, board, department, commission, court, tribunal,
authority, agency or other instrumentality of any such government or otherwise
exercising any executive, legislative, judicial, administrative or regulatory
functions of such government or (b) any other government entity having
jurisdiction over any matter contemplated by the Operative Agreements or
relating to the observance or performance of the obligations of any of the
parties to the Operative Agreements.

"INITIAL DEPOSITS" has the meaning set forth in the sixth recital to the Note
Purchase Agreement.

"INITIAL PURCHASE AGREEMENT ASSIGNMENT" means a Purchase Agreement Assignment
substantially in the form of Exhibit D-2 to the Note Purchase Agreement.

"INTERCREDITOR AGREEMENT" has the meaning set forth in the ninth recital to the
Note Purchase Agreement.

"ISSUANCE DATE" means the date of the original issuance of the Certificates.

"LAW" means (a) any constitution, treaty, statute, law, decree, regulation,
order, rule or directive of any Government Entity, and (b) any judicial or



administrative interpretation or application of, or decision under, any of the
foregoing.

"LEASE" means a Lease Agreement substantially in the form of Exhibit B to the
Note Purchase Agreement.

"LIQUIDITY FACILITIES" has the meaning set forth in the ninth recital to the
Note Purchase Agreement.

"LIQUIDITY PROVIDERS" has the meaning set forth in the ninth recital to the Note
Purchase Agreement.

"LOAN TRUSTEE" means the "Mortgagee" as defined in the Financing Agreements.

"MANDATORY DOCUMENT TERMS" means the terms set forth on Schedule IV to the Note
Purchase Agreement.

"MANDATORY ECONOMIC TERMS" means the terms set forth on Schedule III to the Note
Purchase Agreement.

"MANUFACTURER" means Embraer-Empresa Brasileira de Aeronautica S.A., a Brazilian
corporation, solely in its capacity as manufacturer or seller of the Aircraft.

"NEW AIRCRAFT" has the meaning set forth in the second recital to the Note
Purchase Agreement.

"NOTE PURCHASE AGREEMENT" means the Note Purchase Agreement to which this Annex
A is attached.

"NOTICE OF PURCHASE WITHDRAWAL" with respect to the Deposit Agreement, has the
meaning set forth in Section 2.3 thereof.

"OPERATIVE AGREEMENTS" means, collectively, the Pass Through Trust Agreement,
the Escrow and Paying Agent Agreement, the Deposit Agreement, the Liquidity
Facilities, the Intercreditor Agreement, the Certificates and the Financing
Agreements.

"OWNER PARTICIPANT" means, with respect to any Aircraft, the Person named as the
Owner Participant in the Participation Agreement with respect to such Aircraft.

"OWNER TRUST" means, with respect to any Aircraft, the trust created by the
Trust Agreement related thereto.

"OWNER TRUSTEE" means, with respect to any Aircraft, the "Owner Trustee" party
to the Trust Agreement related thereto.



"PARTICIPATION AGREEMENT" means a Participation Agreement substantially in the
form of Exhibit A to the Note Purchase Agreement.

"PASS THROUGH TRUST" has the meaning set forth in the fourth recital to the Note
Purchase Agreement.

"PASS THROUGH TRUST AGREEMENT" means the Trust Supplement, together with the
Basic Pass Through Trust Agreement, dated as of the Issuance Date, by and
between the Company and Pass Through Trustee.

"PASS THROUGH TRUSTEE" has the meaning set forth in the first paragraph of the
Note Purchase Agreement.

"PAYING AGENT" has the meaning set forth in the first paragraph of the Note
Purchase Agreement.

"PAYING AGENT AGREEMENTS" has the meaning set forth in Section 3(f)(i) of the
Note Purchase Agreement.

"PERSON" means any individual, firm, partnership, joint venture, trust, trustee,
Government Entity, organization, association, corporation, limited liability
company, government agency, committee, department, authority and other body,
corporate or incorporate, whether having distinct legal status or not, or any
member of any of the same.

"PROSPECTUS SUPPLEMENT" means the final Prospectus Supplement, dated June 18,
2004, to the Prospectus, dated August 23, 2001, of the Company relating to the
offering of the Certificates.

"PURCHASE AGREEMENT" means the Purchase Agreement GPJ-003/96 between
Manufacturer and ExpressJet Airlines, Inc. (formerly Continental Express, Inc.)
(including all exhibits thereto, together with all letter agreements entered
into that by their terms constitute part of such Purchase Agreement), as
amended.

"PURCHASE AGREEMENT ASSIGNMENT" means a Purchase Agreement Assignment
substantially in the form of Exhibit D-1 to the Note Purchase Agreement (for an
Existing Aircraft) or Exhibit D-3 to the Note Purchase Agreement (for a New
Aircraft).

"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. The initial Rating Agencies will be



Moody's Investors Service, Inc. and Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc.

"RATING AGENCY CONFIRMATION" means, with respect to (1) any Financing Agreement
that has been modified in any material respect from the forms thereof attached
to the Note Purchase Agreement or (2) a Substitute Aircraft, a written
confirmation from each of the Rating Agencies that (a) the use of such Financing
Agreement with such modifications or (b) the substituting of such Substitute
Aircraft for a New Aircraft, respectively, would not result in (i) a reduction
of the rating for the Certificates below the then current rating for the
Certificates or (ii) a withdrawal or suspension of the rating of the
Certificates.

"REGISTER" means the register maintained pursuant to Sections 3.04 and 7.12 of
the Basic Pass Through Trust Agreement with respect to the Pass Through Trust.

"REGULAR DISTRIBUTION DATE" shall mean the first day of each month, commencing
August 1, 2004.

"REMAINING WEIGHTED AVERAGE LIFE" means, on a given date with respect to any
Equipment Note, the number of days equal to the quotient obtained by dividing
(a) the sum of each of the products obtained by multiplying (i) the amount of
each then remaining scheduled payment of principal of such Equipment Note by
(ii) the number of days from and including such determination date to but
excluding the date on which such payment of principal is scheduled to be made,
by (b) the then outstanding principal amount of such Equipment Note.

"SCHEDULED CLOSING DATE" has the meaning set forth in Section 1(b) of the Note
Purchase Agreement.

"SECTION 1110" means 11 U.S.C. ss. 1110 of the Bankruptcy Code or any successor
or analogous Section of the federal bankruptcy Law in effect from time to time.

"SUBORDINATION AGENT" has the meaning set forth in the first paragraph of the
Note Purchase Agreement.

"SUBSTITUTE AIRCRAFT" has the meaning set forth in Section 1(g) of the Note
Purchase Agreement.

"TAXES" means all license, recording, documentary, registration and other
similar fees and all taxes, levies, imposts, duties, charges, assessments or
withholdings of any nature whatsoever imposed by any Taxing Authority, together



with any penalties, additions to tax, fines or interest thereon or additions
thereto.

"TAXING AUTHORITY" means any federal, state or local government or other taxing
authority in the United States, any foreign government or any political
subdivision or taxing authority thereof, any international taxing authority or
any territory or possession of the United States or any taxing authority
thereof.

"TREASURY YIELD" means, as of any date of determination, with respect to any
Equipment Note (utilizing the Assumed Amortization Schedule applicable thereto),
the interest rate (expressed as a decimal and, in the case of United States
Treasury bills, converted to a bond equivalent yield) determined to be the per
annum rate equal to the monthly yield to maturity for United States Treasury
securities maturing on the Average Life Date of such Equipment Note and trading
in the public securities markets either as determined by interpolation between
the most recent weekly average yield to maturity for two series of United States
Treasury securities, trading in the public securities markets, (A) one maturing
as close as possible to, but earlier than, the Average Life Date of such
Equipment Note and (B) the other maturing as close as possible to, but later
than, the Average Life Date of such Equipment Note, in each case as published in
the most recent H.15(519) or, if a weekly average yield to maturity for United
States Treasury securities maturing on the Average Life Date of such Equipment
Note is reported on the most recent H.15(519), such weekly average yield to
maturity as published in such H.15(519). The "most recent H.15(519)" means the
H.15(519) most recently published prior to the close of business on the date of
determination of the Deposit Make-Whole Premium.

"TRIGGERING EVENT" has the meaning assigned to such term in the Intercreditor
Agreement.

"TRUST AGREEMENT" means a Trust Agreement substantially in the form of Exhibit E
to the Note Purchase Agreement.

"TRUST INDENTURE" means a Trust Indenture and Mortgage substantially in the form
of Exhibit C to the Note Purchase Agreement.

"TRUST SUPPLEMENT" means an agreement supplemental to the Basic Pass Through
Trust Agreement pursuant to which (i) a trust is created for the benefit of the
holders of the Certificates, (ii) the issuance of the Certificates representing



fractional undivided interests in such trust is authorized and (iii) the terms
of the Certificates are established.

"UNDERWRITERS" has the meaning set forth in the fifth recital to the Note
Purchase Agreement.

"UNDERWRITING AGREEMENT" has the meaning set forth in the fifth recital to the
Note Purchase Agreement.

"WTC" has the meaning set forth in the first paragraph of the Note Purchase
Agreement.



                                  EXHIBIT A to
                             NOTE PURCHASE AGREEMENT

                         FORM OF PARTICIPATION AGREEMENT

                               (Filed Separately)



                                  EXHIBIT B to
                             NOTE PURCHASE AGREEMENT

                                  FORM OF LEASE

                               (Filed Separately)


                                  EXHIBIT C to
                             NOTE PURCHASE AGREEMENT

                             FORM OF TRUST INDENTURE

                               (Filed Separately)


                                 EXHIBIT D-1 to
                             NOTE PURCHASE AGREEMENT

                      FORM OF PURCHASE AGREEMENT ASSIGNMENT
                               (EXISTING AIRCRAFT)


                              AMENDED AND RESTATED
                  PURCHASE AGREEMENT ASSIGNMENT NO. 2 - [DEAL_]

      AMENDED AND RESTATED PURCHASE AGREEMENT ASSIGNMENT NO. 2 - [Deal_],
dated as of June ___, 2004 (this "Restated Assignment"), between PM Limited, a
Cayman Islands company (the "Assignor" or "PM Limited"), WELLS FARGO BANK
NORTHWEST, NATIONAL ASSOCIATION, not in its individual capacity but solely as
Owner Trustee (the "Assignee"), and EXPRESSJET AIRLINES, INC., a Delaware
corporation ("Express"), which amends and restates in its entirety the Original
PAA No. 2 (as hereinafter defined).

                                    RECITALS

      WHEREAS, Express and EMBRAER-Empresa Brasileira de Aeronautica S.A., a
corporation organized under the laws of Brazil ("Embraer"), have entered into
the Purchase Agreement, pursuant to which, among other things, Embraer has
agreed to manufacture and sell to Express, and Express has agreed to purchase
from Embraer, certain aircraft, including the Aircraft (as defined in the
Purchase Agreement Assignment No. 1 described below);

      WHEREAS, pursuant to a Purchase Agreement Assignment No. 1 - [Deal_],
dated as of [Initial_Delivery_Date] ("PAA No. 1"), between Express and PM
Limited, Express has, among other things, heretofore assigned to PM Limited,
with the consent of the Manufacturer, certain of its right, title and interest
in, to and under the Purchase Agreement including, without limitation, the right
to purchase the Aircraft from Embraer upon and subject to the terms and
conditions set forth in the Purchase Agreement and PAA No.
1;

      WHEREAS, PM Limited has heretofore purchased the Aircraft from Embraer
and, concurrently therewith, has heretofore sold the Aircraft to Wells Fargo
Bank Northwest, National Association, acting not in its individual capacity but
solely as Owner Trustee under the Trust Agreement [Deal_], dated as of
[Initial_Delivery_Date] (the "Original Trust Agreement"), between Refine,
Inc., as Owner Participant (the "Owner Participant"), and Wells Fargo Bank
Northwest, National Association ("Wells Fargo"), as amended and restated in its
entirety by that certain Amended and Restated Trust Agreement [Deal_], dated
as of the date hereof, between the Owner Participant and Wells Fargo (the
Original Trust Agreement, as so amended and restated, the "Amended and Restated
Trust Agreement");

      WHEREAS, in connection with the sale of the Aircraft by PM Limited to the
Owner Trustee and with the consent of the Manufacturer, PM Limited has, pursuant
to the Purchase Agreement Assignment No. 2-[Deal_], dated as of
[Initial_Delivery_Date] (the "PAA No. 2"), between PM Limited and the Owner
Trustee, heretofore transferred to the Owner Trustee all of PM Limited's present
and future rights, title, obligations and interests in, to and under the



Purchase Agreement as assigned by PAA No. 1, except for PM Limited's right to
purchase the Aircraft from the Manufacturer pursuant to Section 2(a) of PAA No.
1;

      WHEREAS, the Owner Trustee desires to (i) issue Equipment Notes (as
defined in Annex A to the Lease Agreement referred to herein) for the purpose of
enabling the Owner Participant to repay, in part, the indebtedness relating to
the acquisition of the Aircraft by the Owner Trustee, (ii) terminate the Lease
Agreement [Deal_], dated as of the date of PAA No. 1 (the "Existing Lease"),
between the Owner Trustee and Continental Airlines, Inc. ("Continental"), in
connection therewith and (iii) re-lease the Aircraft to Continental pursuant to
the Lease Agreement (as hereinafter defined); and

      WHEREAS, to facilitate the transactions described in the immediately
preceding Whereas clause, PM Limited and the Assignee desire to amend and
restate in its entirety PAA No. 2 on the terms and conditions hereof, Express
desires to agree to the terms and provisions hereof and to certain changes to
PAA No. 1, as provided herein, and the Manufacturer is willing to execute and
deliver to the Assignee a Consent and Agreement to the provisions hereof in
substantially the form attached hereto as Annex 1;

      NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants and agreements of the parties contained herein, and for other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the Assignor and the Assignee hereby agree to amend and restate
PAA No.2 in its entirety upon the terms set forth herein, and the parties hereto
further agree as follows:

      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 PAA No. 1.

      Section 2. TRANSFER AND ASSUMPTION. The Assignor does hereby sell, assign
and transfer to the Assignee all of the Assignor's present and future rights,
title, obligations and interest in, to and under the Purchase Agreement as
assigned by PAA No. 1, excluding the right to purchase the Aircraft from the
Manufacturer (the "Assignor's Interest") and the Assignee hereby accepts the
Assignor's Interest from the Assignor. The Assignee agrees that it shall be
bound by all the terms of, and shall assume and undertake to perform all the
obligations of, the Assignor with respect to the Assignor's Interest. For all
purposes of PAA No. 1 and this Restated Assignment, Express, the Assignor and
the Assignee hereby agree that:

            (I) the "Lease" or "Lease Agreement" referred to in PAA No. 1 shall
      be deemed to refer to the Lease Agreement [Deal_], dated as of the date
      hereof (as the same may be amended, modified or supplemented, the "Lease
      Agreement"), between the Owner Trustee and Continental, providing for the
      lease of the Aircraft;




            (II) the Participation Agreement referred to in Paragraph 4 of PAA
      No. 1 shall be deemed to refer to the Participation Agreement defined in
      Annex A to the Existing Lease;

            (III) Continental, in lieu of Express, shall have the rights
      referred to in clause (iii)(B) of the first paragraph of Section 2 of PAA
      No. 1 after notice by Continental to the Manufacturer that Continental is
      entitled to possession of the Aircraft;

            (IV) Continental, in lieu of Express, shall be entitled to exercise
      the rights of Express under the second paragraph of Section 2 of PAA No. 1
      after notice by Continental to the Manufacturer that Continental is
      entitled to possession of the Aircraft; and

            (V) the Manufacturer shall not be deemed to have knowledge of, and
      need not recognize nor take any action with respect to, the termination of
      Express's rights under PAA No. 1 by Continental to the extent permitted
      hereunder or thereunder unless and until the Manufacturer shall have
      received from Continental, as required by the terms of this Restated
      Assignment, written notice (including notice by fax) thereof and, in
      acting in accordance with the terms and conditions of the Purchase
      Agreement and this Restated Assignment and PAA No. 1, the Manufacturer may
      act in accordance with and conclusively rely upon any such notice.

      Section 3. CONFIDENTIAL TREATMENT. The Assignee and the Assignor agree
that the provisions of Paragraph 8 of PAA No. 1 are hereby terminated and
superseded by the provisions of this Section 3 and, in furtherance thereof,
agree that they will not disclose to any third party (other than their direct
and indirect parent companies) the terms of the Purchase Agreement (whether or
not related to the Aircraft) or PAA No. 1 or this Restated Assignment, except
(a) as required by applicable law, judicial proceeding or governmental
regulation, (b) in the case of the Assignee, as required for the assignment of
its rights under this Restated Assignment in accordance with the provisions of
Article 16 of the Purchase Agreement, (c) with the prior written consent of
Express, the Assignor and the Manufacturer, which consent shall not be
unreasonably withheld with respect to a prospective bona fide purchaser of the
Aircraft, (d) to prospective and permitted transferees of Owner Participant's
interest or their or Owner Participant's respective counsel or special counsel,
independent insurance brokers, auditors, or other agents, (e) as otherwise
permitted by the Operative Agreements (as defined in Annex A to the Lease), or
(f) to such other Persons as are reasonably deemed necessary by the disclosing
party for the purposes of enforcing such documents by such party; PROVIDED that
any such disclosure under this sentence shall be made only to the extent
necessary to meet the specific requirements or needs of the Assignee or PM
Limited, as the case may be. Any disclosure as contemplated in (b), (c) or (d)
above shall include a requirement that the entity to which the information is
disclosed shall be subject to obligations of nondisclosure with respect to such
information substantially the same as those contained herein.




      Section 4. ASSIGNMENT TO MORTGAGEE. The right, title and interest of the
Assignee in and to this Restated Assignment has, contemporaneously with the
execution and delivery hereof, been assigned to and is subject to a security
interest in favor of the Mortgagee (as such terms and the other capitalized
terms used hereinafter in this sentence are defined in Appendix A to the Lease)
under the Trust Indenture, for the benefit of the Loan Participants and the Note
Holders referred to the Trust Indenture, all to the extent provided in such
Trust Indenture. The Assignor hereby consents to such assignment and to the
creation of such security interest in and to this Restated Assignment.

      Section 5. NOTICES. Any notices provided for in PAA No. 1 shall be
delivered to the Assignee at the following address or such other place as the
Assignee may designate in accordance with PAA No. 1:

                  Wells Fargo Bank Northwest,
                  National Association
                  MAC: U1228-120
                  Attn:  Corporate Trust Dept.
                  299 S. Main Street, 12th Floor
                  Salt Lake City, UT 84111
                  Facsimile:  801-246-5053

      Section 6. HEADINGS.  The headings of the Sections herein are for
convenience of reference only and shall not define or limit any of the terms
or provisions hereof.

      Section 7. GOVERNING LAW. THIS RESTATED ASSIGNMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, UNITED
STATES OF AMERICA, WITHOUT REGARD TO CONFLICT OF LAWS RULES OTHER THAN SECTION
5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

      Section 8. COUNTERPARTS. This Agreement and any amendments, waivers,
consents or supplements hereto may be executed in any number of counterparts (or
upon separate signature pages bound together into one or more 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.

      Section 9. PURCHASE AGREEMENT. The rights and obligations of the parties
hereto are subject to the terms and conditions of the Purchase Agreement.

             [Remainder of the Page is Intentionally Left Blank.]




      IN WITNESS WHEREOF, the parties hereto have caused this Restated
Assignment to be duly executed as of the day and year first written above.


                                          PM LIMITED, as Assignor


                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:


                                          WELLS FARGO BANK
                                          NORTHWEST, NATIONAL
                                          ASSOCIATION, not in its
                                          individual capacity but solely as
                                          Owner Trustee, as Assignee


                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:


                                          EXPRESSJET AIRLINES, INC.


                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:





Annex 1 to Amended
and Restated Purchase
Agreement Assignment No. 2 - [Deal_]

                     CONSENT AND AGREEMENT NO. 2 - [DEAL_]

      The undersigned, EMBRAER-EMPRESA BRASILEIRA DE AERONAUTICA S.A., a
corporation organized and existing under the laws of Brazil, hereby acknowledges
notice of and consents to all of the terms of the foregoing Amended and Restated
Purchase Agreement Assignment No. 2 - [Deal_], dated as of ________ ___, 2004,
by and among PM Limited, WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not
in its individual capacity but solely as Owner Trustee, and EXPRESSJET AIRLINES,
INC., to the extent they relate to the Manufacturer (herein called the
"Assignment No. 2", the defined terms therein being hereinafter used with the
same meaning) and hereby confirms to the Assignee that: (i) all representations,
warranties, indemnities and agreements of the Manufacturer under the Purchase
Agreement with respect to the Aircraft shall inure to the benefit of the
Assignee to the same extent as if originally named the "Buyer" therein, subject
to the terms and conditions of the Assignment No. 2, the Purchase Agreement and
PAA No. 1; (ii) the Assignee shall not be liable for any of the obligations or
duties of Express under the Purchase Agreement, nor shall the Assignment No. 2
give rise to any duties or obligations whatsoever on the part of the Assignee
owing to the Manufacturer except for the Assignee's agreement to the effect that
in exercising any rights under the Purchase Agreement, or in making any claim
with respect to the Aircraft or other things (including without limitation data,
documents and services) delivered or to be delivered pursuant to the Purchase
Agreement, the terms and conditions of the Purchase Agreement shall apply to and
be binding upon the Assignee to the same extent as if the Assignee had been the
original "Buyer" thereunder, and with respect to such agreement the Manufacturer
agrees that, anything contained in the Purchase Agreement or the Assignment No.
2 to the contrary notwithstanding, so long as the Manufacturer shall not have
received notice that a Lease Event of Default has occurred and is continuing,
the Assignee shall not have any responsibility to the Manufacturer for failure
to comply with any of the terms of the Purchase Agreement with respect to the
Aircraft while under lease to Continental so long as the Assignee acts upon the
written instructions of Express (or, if Continental shall have specified in a
written notice to the Assignee and the Manufacturer that Continental is entitled
to possession of the Aircraft, Continental) (to which instructions the
Manufacturer understands it shall have access on request); PROVIDED that no
person other than the Manufacturer shall have any rights against the Assignee
with respect to the undertaking and agreement set forth in this clause (ii);
(iii) the Manufacturer will continue to pay to Express (or, if Continental shall
have specified in a written notice to the Assignee and the Manufacturer that
Continental is entitled to possession of the Aircraft, Continental) all payments
which the Manufacturer may be required to make in respect of the Aircraft under
the Purchase Agreement unless and until the Manufacturer shall have received
written notice addressed to its Contracts Administrator, by mail to
EMBRAER-Empresa Brasileira de Aeronautica S.A., Av. Brigadeiro Faria Lima, 2170,
12.227-901 Sao Jose dos Campos-SP, Brazil, or by fax to fax no: 55 12-3927-1257,



that a Lease Event of Default has occurred and is continuing (which such notice
from the Assignee shall be conclusive proof thereof to the Manufacturer and as
to which the Manufacturer shall have no obligation to inquire), whereupon the
Manufacturer will, until the Manufacturer shall have received notice in writing
sent or addressed as aforesaid that no Lease Event of Default exists, make any
and all payments and take any and all actions which it may be required
thereafter to make or take in respect of the Aircraft under the Purchase
Agreement and the right to receive which has been assigned under the Assignment
No. 2 directly to the Assignee at its address at MAC: U1228-120, 299 S. Main
Street, 12th Floor, Salt Lake City, Utah 84111 , telecopy no. 801-246-5053; (iv)
from and after the delivery of the Aircraft on the Delivery Date, the
Manufacturer will not assert any lien or claim against the Aircraft or any part
thereof arising with respect to or in connection with any work or other services
performed before the delivery and acceptance of the Aircraft; and (v) the
Manufacturer consents to the grant of a security interest in the Purchase
Agreement pursuant to the Trust Indenture (as defined in Appendix A to the
Lease).

      The Manufacturer hereby represents and warrants that (A) the Manufacturer
is a corporation duly organized and existing in good standing under the laws of
Brazil, (B) the making and performance of the Purchase Agreement have been duly
authorized by all necessary corporate action on the part of the Manufacturer, do
not require any stockholder approval, do not contravene the Manufacturer's
By-Laws or any indenture, credit agreement or other contractual agreement to
which the Manufacturer is a party or by which it is bound, and the making of the
Purchase Agreement does not contravene any law binding on the Manufacturer, (C)
the making and performance of this Consent and Agreement have been duly
authorized by all necessary corporate action on the part of the Manufacturer, do
not require any stockholder approval and do not contravene any law binding on
the Manufacturer or contravene the Manufacturer's By-laws or any indenture,
credit agreement or other contractual agreement to which the Manufacturer is a
party or by which it is bound, (D) the Purchase Agreement constituted as of the
date thereof and at all times thereafter to and including the date of this
Consent and Agreement constitutes a binding obligation of the Manufacturer
enforceable against the Manufacturer in accordance with its terms subject to:
(i) the limitations of applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the rights of creditors generally) and (ii)
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and (E) this Consent and
Agreement is a binding obligation of the Manufacturer enforceable against the
Manufacturer in accordance with its terms subject to: (a) the limitations of
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally; and (b) general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law). It is understood that the execution by the Manufacturer of
this Consent and Agreement is subject to the condition that concurrently with
execution and delivery hereof the Aircraft will be leased to Continental under
the Lease Agreement.

       [The remainder of this page has been left blank intentionally.]



      This Consent and Agreement shall be governed by the laws of the State of
New York, including all matters of construction, validity and performance, as
applicable to contracts between citizens of the state to be performed wholly
within that state, and without regard to conflicts of law rules other than
Section 5-1401 of the New York General Obligations Law.

      Dated as of _______ ___, 2004.

                                    EMBRAER-EMPRESA BRASILEIRA
                                    DE AERONAUTICA S.A.



                                    By
                                      ----------------------------------
                                      Title:



                                    By
                                      ----------------------------------
                                      Title:




                                 EXHIBIT D-2 to
                             NOTE PURCHASE AGREEMENT

                FORM OF INITIAL PURCHASE AGREEMENT ASSIGNMENT
                                 (NEW AIRCRAFT)


                   PURCHASE AGREEMENT ASSIGNMENT NO. 1-[DEAL]


            This PURCHASE AGREEMENT ASSIGNMENT NO. 1-[DEAL] (the
"Assignment"), dated as of _______ ___, 2004, is between EXPRESSJET
AIRLINES, INC., a Delaware corporation (the "Assignor"), and PM Limited, a
Cayman Islands company (the "Assignee").

            WHEREAS, the Assignor and the Manufacturer (as hereinafter defined)
are parties to the Purchase Agreement (as hereinafter defined) providing, among
other things, for the manufacture and sale by the Manufacturer to the Assignor
of certain aircraft, engines and related equipment, including the Aircraft (as
hereinafter defined), and the Aircraft is covered by the Lease Agreement (as
hereinafter defined).

            WHEREAS, the Assignee wishes to acquire the Aircraft from the
Manufacturer, and the Assignor, on the terms and conditions hereinafter set
forth, is willing to assign to the Assignee certain of the Assignor's rights and
interests under the Purchase Agreement, and the Assignee is willing to accept
such assignment, as hereinafter set forth.

            WHEREAS, the Manufacturer is willing to execute and deliver to
Assignee a Consent and Agreement to the provisions hereof in substantially the
form attached hereto as Annex 1.

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

             1. For all purposes of this Assignment, except as otherwise
expressly provided or unless the context otherwise requires, the following terms
shall have the following meanings:

            AIRCRAFT. The Embraer Model EMB-145 XR aircraft to be delivered
under the Purchase Agreement bearing Manufacturer's Serial No. [_________] and
U.S. Registration Mark [N______] (as hereinafter defined), with two Allison
AE3007A1E engines installed on such aircraft on the date of delivery therefor,
together with the equipment, components and accessories installed thereon
pursuant to the Purchase Agreement.

            LEASE OR LEASE AGREEMENT. The Lease Agreement dated as of the date
hereof as the same may be amended, modified or supplemented, between Wells Fargo
Bank Northwest, National Association, not in its individual capacity but solely
as Owner Trustee, as lessor, and Continental Airlines, Inc. ("CAL"), as lessee,
providing for the lease of the Aircraft.

            MANUFACTURER. EMBRAER-Empresa Brasileira de Aeronautica S.A., a
corporation organized and existing under the laws of Brazil, and its successors
and assigns.

            PURCHASE AGREEMENT. Purchase Agreement No. GPJ-003/96, dated August
5, 1996 as the same may be amended, supplemented or otherwise modified from time
to time in accordance with its terms, between the Manufacturer and the Assignor



(formerly known as Continental Express, Inc.) solely with respect to Articles 1,
2(a), 3(a), 4(a), 5(a), 6, 7(a) and (c), 12(a), 15, 17, 19, 20, 21, 24, 25, 26,
27, 28, 29 and 30 thereof, and Attachment C thereto providing, among other
things, for the manufacture and sale by the Manufacturer to the Assignor (or its
designee) of the airframe, Allison AE3007A1E engines and parts installed
thereon.

            All terms used herein in capitalized form which are defined in the
Lease and not otherwise defined herein shall, when used herein, have the
meanings specified in Annex A to the Lease.

            2. Subject to the terms and conditions of this Assignment, Assignor
does hereby sell, assign, transfer and set over unto the Assignee all the
Assignor's rights and interest in and to the Purchase Agreement as and to the
extent that the same relate to the Aircraft and the purchase and operation
thereof, except to the extent reserved below, including, without limitation, (a)
the right upon valid tender by the Manufacturer to purchase the Aircraft
pursuant to the Purchase Agreement (including the right to accept delivery of
such Aircraft, such right of acceptance to be exercised by a representative of
the Assignor authorized by the Assignee and designated by the Assignor pursuant
to Section 2.2(b) of the Lease), and the right to take title to the Aircraft and
to be named the buyer in the bill of sale to be delivered by the Manufacturer
for the Aircraft pursuant to Article 7(c) of the Purchase Agreement, (b) all
claims for damages in respect of the Aircraft arising as a result of any default
by the Manufacturer under the Purchase Agreement or any supplier of parts or
equipment installed on or in the Aircraft, including, without limitation, all
warranty and indemnity provisions contained in the Purchase Agreement, and all
claims arising thereunder, in respect of the Aircraft, and (c) any and all
rights of the Assignor to compel performance of the terms of the Purchase
Agreement in respect of the Aircraft; RESERVING TO THE ASSIGNOR HOWEVER, (i) all
the Assignor's rights and interests in and to the Purchase Agreement to the
extent the same relates to aircraft other than the Aircraft and the purchase and
operation of such aircraft and to the extent it pertains to any other matters
not directly pertaining to the Aircraft, and (ii) all the Assignor's rights and
obligations with respect to any post-delivery adjustment of the purchase price
of the Aircraft (and any other payments made or to be made by the Assignor in
respect of such Aircraft under the Purchase Agreement or amounts credited or to
be credited by the Manufacturer to the Assignor, PROVIDED that Assignor shall
obtain no additional rights in or to the Aircraft or any part thereof by reason
of making any such payment), and (iii) with respect to the Aircraft so long as
the Aircraft is subject to the Lease (A) the rights to demand, accept and retain
all rights in and to all property (other than the Aircraft), data and service
related to the Aircraft which the Manufacturer is obligated to provide or does
provide pursuant to the Purchase Agreement, and (B) the right to obtain
services, training, data and demonstration and test flights related to the
Aircraft pursuant to the Purchase Agreement (provided that after reasonable
prior notice by CAL to Manufacturer, CAL shall be entitled to the rights
referred to in this clause (iii) in lieu of the Assignor), and (iv) the right to
maintain plant representatives at the Manufacturer's plant pursuant to the
Purchase Agreement. The Assignee hereby accepts such assignment subject to the
terms hereof.

            Notwithstanding the foregoing, so long as no Lease Event of Default
as defined in Section 14 of the Lease has occurred and is continuing, the
Assignee shall and it does hereby authorize the Assignor during the term of the
Lease, as sublessee under the Express Sublease, to the exclusion of the
Assignee, to exercise in Assignor's own name all rights and powers of the
"Buyer" under the Purchase Agreement including the right to retain any recovery
or benefit resulting from the enforcement of any warranty or indemnity under the
Purchase Agreement in respect of the Aircraft except that the Assignor may not
enter into any amendment, modification or supplement to the Purchase Agreement
without the written consent or countersignature of the Assignee if such
amendment, modification or supplement would result in any rescission,



cancellation or termination of the Purchase Agreement with respect to the
Aircraft, except as permitted by Article 9 or 22 of the Purchase Agreement
provided that after reasonable prior notice by CAL to Manufacturer, CAL shall be
entitled to exercise the rights of the Assignor referred to in this paragraph.

            Until such time as written notice of a Lease Event of Default or
termination of the Lease shall have been given by the Lessor to the
Manufacturer, to its Director of Contracts, by mail to EMBRAER-Empresa
Brasileira de Aeronautica S.A., Av. Brigadeiro Faria Lima, 2170, 12.227-901 Sao
Jose dos Campos-SP, Brazil, or by fax to fax no.: 55 12-3927-1257, the
Manufacturer shall deal solely and exclusively with the Assignor. After such
notice has been given to the Manufacturer, and until the Lessor shall have
notified the Manufacturer that a Lease Event of Default is no longer continuing,
the Manufacturer shall deal solely and exclusively with the Lessor. Assignee
shall cause Lessor to promptly after all Lease Events of Default have been
remedied to the satisfaction of Lessor, give written notice that such remedy has
occurred to the Manufacturer with a copy to the Assignor, and upon the
Manufacturer's receipt of such notice, the Assignor and the Manufacturer shall
have all of the respective rights which they have hereunder and under the
Consent and Agreement annexed hereto in the absence of notice from the Lessor of
a Lease Event of Default.

            For all purposes of this Assignment, the Manufacturer shall not be
deemed to have knowledge of, and need not recognize nor take any action with
respect to, the occurrence of a Lease Event of Default, or the discontinuance of
a Lease Event of Default, or the Aircraft's becoming no longer subject to the
Lease, or the termination of the Assignor's rights hereunder by CAL to the
extent permitted herewith, unless and until the Manufacturer shall have received
from the Lessor or CAL, as required by the terms of this Assignment, written
notice (including notice by fax) thereof and, in acting in accordance with the
terms and conditions of the Purchase Agreement and this Assignment, the
Manufacturer may act in accordance with and conclusively rely upon any such
notice.

            3. It is expressly agreed that, anything herein contained to the
contrary notwithstanding: (a) the Assignor shall at all times remain liable to
the Manufacturer under the Purchase Agreement to perform all duties and
obligations of the "Buyer" thereunder to the same extent as if this Assignment
had not been executed; (b) the exercise by the Assignee of any of the rights
assigned hereunder shall not release the Assignor from any of its duties or
obligations to the Manufacturer under the Purchase Agreement except to the
extent that such exercise by the Assignee shall constitute performance of such
duties and obligations; (c) subject to the provisions of the penultimate
paragraph of this Section 3, the Assignee shall not have any obligation or
liability under the Purchase Agreement (including in particular, but without
limitation, any liability for the payment of any taxes and customs duties under
the Purchase Agreement, the obligation for payment of which shall remain with
the Assignor as provided in clause (d) below) by reason of, or arising out of,
this Assignment or be obligated to perform any of the obligations or duties of
the Assignor under the Purchase Agreement or to make any payment (other than to
pay the purchase price for the Aircraft as invoiced on the delivery date for
such Aircraft to the extent and upon the terms and conditions set forth in the
Purchase Agreement and the Lease Agreement) or to make any inquiry as to the
sufficiency of any payment received by it or to present or file any claim or to
take any other action to collect or enforce any claim for any payment assigned
hereunder; (d) after the delivery date for the Aircraft under the Purchase



Agreement, the Assignor will exercise its rights and perform its obligations
under the Purchase Agreement to the extent that such rights and obligations have
not been assigned hereunder or performed by the Assignee. Nothing contained in
this Section 3 shall impose upon the Assignee any liability for post-delivery
adjustments in price, which adjustments it is understood and agreed will be the
sole right and responsibility of the Assignor.

            Nothing contained herein shall subject the Manufacturer to any
liability to which it would not otherwise be subject under the Purchase
Agreement or modify in any respect the Manufacturer's contract rights thereunder
or require the Manufacturer to divest itself of title to or possession of the
Aircraft therefor until delivery thereof and payment therefor on the delivery
date as provided therein.

            Without in any way releasing the Assignor from any of its duties or
obligations under the Purchase Agreement, the Assignee hereby agrees, expressly
for the benefit of the Manufacturer, that notwithstanding anything contained
herein to the contrary, insofar as the provisions of the Purchase Agreement
relate to the Aircraft accepted by Assignee under the Purchase Agreement, in
exercising any rights under the Purchase Agreement, or in making any claim with
respect to the Aircraft or other things (including without limitation data,
documents and services) delivered or to be delivered pursuant to the Purchase
Agreement, the terms and conditions of the Purchase Agreement, shall apply to
and be binding upon Assignee to the same extent as if Assignee had been the
original "Buyer" thereunder. Assignee further agrees, expressly for the benefit
of the Manufacturer, that at any time and from time to time upon the written
request of the Manufacturer, Assignee shall promptly and duly execute and
deliver any and all such further assurances, instruments and documents and take
all such further action as the Manufacturer may reasonably request in order to
obtain the full benefits of Assignee's agreements set forth in this paragraph.

            The Assignee hereby confirms that it shall be deemed for all
purposes to have read and be familiar with the Purchase Agreement and to
thoroughly understand the terms and conditions thereof.

            4. On the delivery date for the Aircraft, the Assignee agrees,
subject to satisfaction or waiver of the conditions set forth in Section 4 of
the Participation Agreement to purchase the Aircraft from the Manufacturer and,
subject to the provisions of clause (c) of the first paragraph of Section 3
hereof, to pay (or agree to pay) the Manufacturer an amount equal to the unpaid
balance of the purchase price payable to the Manufacturer on such Delivery Date
for such Aircraft pursuant to the Purchase Agreement, as such unpaid balance may
be adjusted in accordance with the terms of the Purchase Agreement and invoiced
by the Manufacturer to the Assignee on or before the delivery date for such
Aircraft.

            5. The Assignor agrees that at any time and from time to time upon
the written request of the Assignee, the Assignor will promptly and duly execute
and deliver any and all such further instruments and documents and take such
further action as the Assignee may reasonably request in order to obtain the
full benefits of this Assignment and of the rights and powers herein granted.




            6. The Assignor does hereby represent and warrant (a) that the
Purchase Agreement is in full force and effect and is a legal, valid and binding
obligation of Assignor, enforceable in accordance with its terms and that
Assignor is not in default thereunder; and (b) that Assignor has not assigned,
mortgaged, charged or pledged, and hereby covenants that it will not assign,
mortgage, charge or pledge, so long as this Assignment shall remain in effect,
the whole or any part of the rights hereby assigned or any of its rights with
respect to the Aircraft under the Purchase Agreement not assigned hereby, to
anyone other than the Assignee.

            7. The Assignee agrees that, so long as the Lease has not been
terminated and the Assignor remains in possession, it will not enter into any
agreement with the Manufacturer that would amend, modify, rescind, cancel or
terminate the Purchase Agreement in respect of the Aircraft without the prior
written consent of the Assignor.

             8. The Assignee agrees that it will not disclose to any third party
(other than their direct and indirect parent companies) the terms of the
Purchase Agreement (whether or not related to the Aircraft) or this Assignment,
except (a) as required by applicable law, judicial proceeding or governmental
regulation, or (b) as required for the assignment of its rights under this
Assignment in accordance with the provisions of Article 16 of the Purchase
Agreement, or (c) with the prior written consent of the Assignor and the
Manufacturer, which consent shall not be unreasonably withheld with respect to a
prospective bona fide purchaser of the Aircraft. Any disclosure as contemplated
in (b) above shall include a requirement that the entity to which the
information is disclosed shall be subject to obligations of nondisclosure with
respect to such information substantially the same as those contained herein.

              9. This Assignment is executed by the Assignor and the Assignee
concurrently with the execution and delivery of the Lease.

              10. This Assignment may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.

              11. THIS PURCHASE AGREEMENT ASSIGNMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, UNITED STATES OF
AMERICA, WITHOUT REGARD TO CONFLICT OF LAWS RULES OTHER THAN SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW.

      [The remainder of this page has been left blank intentionally.]






IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be duly
executed as of the day and year first above written.

                                          EXPRESSJET AIRLINES, INC.



                                          By
                                            ------------------------------------



                                          PM LIMITED



                                          By
                                            ------------------------------------


[Partial Assignment]




                                               Annex 1 to Purchase Agreement
                                                     Assignment No. 1-[DEAL]

                       CONSENT AND AGREEMENT No. 1-[DEAL]


            The undersigned, EMBRAER-EMPRESA BRASILEIRA DE AERONAUTICA S.A., a
corporation organized and existing under the laws of Brazil, hereby acknowledges
notice of and consents to all of the terms of the foregoing Purchase Agreement
Assignment - No. 1-[DEAL], dated as of _____ ___, 2004, between EXPRESSJET
AIRLINES, INC. and PM LIMITED, to the extent they relate to the Manufacturer
(herein called the "Assignment", the defined terms therein being hereinafter
used with the same meaning) and hereby confirms to the Assignee that: (i) all
representations, warranties, indemnities and agreements of the Manufacturer
under the Purchase Agreement with respect to the Aircraft shall inure to the
benefit of the Assignee to the same extent as if originally named the "Buyer"
therein, subject to the terms and conditions of the Assignment and the Purchase
Agreement, except as provided in paragraph 2 of the Assignment, (ii) the
Assignee shall not be liable for any of the obligations or duties of the
Assignor under the Purchase Agreement, nor shall the Assignment give rise to any
duties or obligations whatsoever on the part of the Assignee owing to the
Manufacturer except for the Assignee's agreement in the Assignment to the effect
that in exercising any rights under the Purchase Agreement, or in making any
claim with respect to the Aircraft or other things (including without limitation
data, documents and services) delivered or to be delivered pursuant to the
Purchase Agreement, the terms and conditions of the Purchase Agreement, shall
apply to and be binding upon Assignee to the same extent as if Assignee had been
the original "Buyer" thereunder, and with respect to such agreement the
Manufacturer agrees that, anything contained in the Purchase Agreement or the
Assignment to the contrary notwithstanding, so long as the Manufacturer shall
not have received notice from Lessor that a Lease Event of Default has occurred
and is continuing, the Assignee shall not have any responsibility to the
Manufacturer for failure to comply with any of the terms of the Purchase
Agreement with respect to the Aircraft while under lease to CAL so long as the
Assignee acts upon the written instructions of the Assignor (or if CAL shall
have specified in a written notice to Assignee and Manufacturer, CAL) (to which
instructions the Manufacturer understands it shall have access on request);
PROVIDED that no person other than the Manufacturer shall have any rights
against the Assignee with respect to the undertaking and agreement set forth in
this clause (ii); (iii) the Manufacturer will continue to pay to the Assignor
(or if CAL shall have specified in a written notice to Assignee and
Manufacturer, CAL) all payments which the Manufacturer may be required to make
in respect of the Aircraft under the Purchase Agreement unless and until the
Manufacturer shall have received written notice addressed to its Director of
Contracts, by mail to EMBRAER-Empresa Brasileira de Aeronautica S.A., Av.
Brigadeiro Faria Lima, 2170, 12.227-901 Sao Jose dos Campos-SP, Brazil, or by
fax to fax no: 55 12-3927-1257, that a Lease Event of Default has occurred and
is continuing (which such notice from the Assignee shall be conclusive proof
thereof to the Manufacturer and as to which the Manufacturer shall have no
obligation to inquire), whereupon the Manufacturer will, until the Manufacturer
shall have received notice in writing sent or addressed as aforesaid that no
Lease Event of Default exists, make any and all payments and take any and all
actions which it may be required thereafter to make or take in respect of the
Aircraft under the Purchase Agreement and the right to receive which has been
assigned under the Assignment to the Assignee (which has its registered office



at the offices of Caledonian Bank & Trust Limited, Caledonian House, P.O. Box
1043, Dr Roy's Drive, George Town, Grand Cayman, Cayman Islands); and (iv) from
and after the delivery of the Aircraft and payment in full therefor pursuant to
Article 4 of the Purchase Agreement as invoiced on the Delivery Date the
Manufacturer will not assert any lien or claim against the Aircraft or any part
thereof arising with respect to or in connection with any work or other services
performed before the delivery and acceptance of the Aircraft.

            The Manufacturer hereby represents and warrants that (A) the
Manufacturer is a corporation duly organized and existing in good standing under
the laws of Brazil, (B) the making and performance of the Purchase Agreement
have been duly authorized by all necessary corporate action on the part of the
Manufacturer, do not require any stockholder approval, do not contravene the
Manufacturer's By-Laws or any indenture, credit agreement or other contractual
agreement to which the Manufacturer is a party or by which it is bound, and the
making of the Purchase Agreement does not contravene any law binding on the
Manufacturer, (C) the making and performance of this Consent and Agreement have
been duly authorized by all necessary corporate action on the part of the
Manufacturer, do not require any stockholder approval and do not contravene any
law binding on the Manufacturer or contravene the Manufacturer's By-laws or any
indenture, credit agreement or other contractual agreement to which the
Manufacturer is a party or by which it is bound and (D) the Purchase Agreement
constituted as of the date thereof and at all times thereafter to and including
the date of this Consent and Agreement constitutes a binding obligation of the
Manufacturer enforceable against the Manufacturer in accordance with its terms
subject to: (i) the limitations of applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the rights of creditors
generally; and (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law), which
principles do not make the remedies available at law or in equity with respect
to the Purchase Agreement inadequate for the practical realization of the
benefits intended to be provided thereby and this Consent and Agreement is a
binding obligation of the Manufacturer enforceable against the Manufacturer in
accordance with its terms subject to: (a) the limitations of applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
rights of creditors generally; and (b) general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at
law), which principles do not make the remedies available at law or in equity
which respect to this Consent and Agreement inadequate for the practical
realization of the benefits intended to be provided thereby. It is understood
that the execution by the Manufacturer of this Consent and Agreement is subject
to the condition that concurrently with the delivery of the Aircraft the
Aircraft will be leased to Lessee under the Lease Agreement.

      [The remainder of this page has been left blank intentionally.]





            This Consent and Agreement shall be governed by the laws of the
State of New York, including all matters of construction, validity and
performance, as applicable to contracts between citizens of the state to be
performed wholly within that state, and without regard to conflicts of law rules
other than Section 5-1401 of the New York General Obligations Law.

Dated as of
______ ___, 2004
                                          EMBRAER-EMPRESA BRASILEIRA
                                              DE AERONAUTICA S.A.


                                          By
                                            ------------------------------------
                                            Title:


                                          By
                                            ------------------------------------
                                            Title:





                                 EXHIBIT D-3 to
                             NOTE PURCHASE AGREEMENT

                      FORM OF PURCHASE AGREEMENT ASSIGNMENT
                                 (NEW AIRCRAFT)


               PURCHASE AGREEMENT ASSIGNMENT NO. 2 - [DEAL_]

      PURCHASE AGREEMENT ASSIGNMENT NO. 2 - [Deal_], dated as of ______ ___,
2004 (this "Assignment"), between PM Limited, a Cayman Islands company (the
"Assignor" or "PM Limited"), and WELLS FARGO BANK NORTHWEST, NATIONAL
ASSOCIATION, not in its individual capacity but solely as Owner Trustee (the
"Assignee").

                                    RECITALS

      WHEREAS, EXPRESSJET AIRLINES, INC., a Delaware corporation ("Express") and
EMBRAER-Empresa Brasileira de Aeronautica S.A., a corporation organized under
the laws of Brazil ("Embraer"), have entered into the Purchase Agreement,
pursuant to which, among other things, Embraer has agreed to manufacture and
sell to Express, and Express has agreed to purchase from Embraer, certain
aircraft, including the Aircraft (as defined in the Purchase Agreement
Assignment No. 1 described below);

      WHEREAS, pursuant to a Purchase Agreement Assignment No. 1 - [Deal_],
dated as of the date hereof ("PAA No. 1"), between Express and PM Limited,
Express has, among other things, assigned to PM Limited, with the consent of the
Manufacturer, certain of its right, title and interest in, to and under the
Purchase Agreement including, without limitation, the right to purchase the
Aircraft from Embraer upon and subject to the terms and conditions set forth in
the Purchase Agreement and PAA No. 1;

      WHEREAS, PM Limited has purchased the Aircraft from Embraer and,
concurrently therewith, has sold the Aircraft to Wells Fargo Bank Northwest,
National Association, acting not in its individual capacity but solely as Owner
Trustee under the Trust Agreement [Deal_], dated as of the date hereof (the
"Original Trust Agreement"), between Refine, Inc., as Owner Participant (the
"Owner Participant"), and Wells Fargo Bank Northwest, National Association
("Wells Fargo");

      WHEREAS, in connection with the sale of the Aircraft by PM Limited to the
Owner Trustee and with the consent of the Manufacturer, PM Limited shall,
pursuant to this Assignment, transfer to the Owner Trustee all of PM Limited's
present and future rights, title, obligations and interests in, to and under the
Purchase Agreement as assigned by PAA No. 1, except for PM Limited's right to
purchase the Aircraft from the Manufacturer pursuant to Section 2(a) of PAA No.
1;

      WHEREAS, the Owner Trustee desires to (i) issue Equipment Notes (as
defined in Annex A to the Lease Agreement referred to herein) for the purpose of
enabling the Owner Participant to repay, in part, the indebtedness relating to
the acquisition of the Aircraft by the Owner Trustee, and (ii) lease the
Aircraft to Continental Airlines, Inc. ("Continental") pursuant to the Lease
Agreement (as hereinafter defined); and




      WHEREAS, to facilitate the transactions described in the immediately
preceding Whereas clause, the Manufacturer is willing to execute and deliver to
the Assignee a Consent and Agreement to the provisions hereof in substantially
the form attached hereto as Annex 1;

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

      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 PAA No. 1.

      Section 2. TRANSFER AND ASSUMPTION. The Assignor does hereby sell, assign
and transfer to the Assignee all of the Assignor's present and future rights,
title, obligations and interest in, to and under the Purchase Agreement as
assigned by PAA No. 1, excluding the right to purchase the Aircraft from the
Manufacturer (the "Assignor's Interest") and the Assignee hereby accepts the
Assignor's Interest from the Assignor. The Assignee agrees that it shall be
bound by all the terms of, and shall assume and undertake to perform all the
obligations of, the Assignor with respect to the Assignor's Interest.

      Section 3. CONFIDENTIAL TREATMENT. The Assignee and the Assignor agree
that the provisions of Paragraph 8 of PAA No. 1 are hereby terminated and
superseded by the provisions of this Section 3 and, in furtherance thereof,
agree that they will not disclose to any third party (other than their direct
and indirect parent companies) the terms of the Purchase Agreement (whether or
not related to the Aircraft) or PAA No. 1 or this Assignment, except (a) as
required by applicable law, judicial proceeding or governmental regulation, (b)
in the case of the Assignee, as required for the assignment of its rights under
this Assignment in accordance with the provisions of Article 16 of the Purchase
Agreement, (c) with the prior written consent of Express, the Assignor and the
Manufacturer, which consent shall not be unreasonably withheld with respect to a
prospective bona fide purchaser of the Aircraft, (d) to prospective and
permitted transferees of Owner Participant's interest or their or Owner
Participant's respective counsel or special counsel, independent insurance
brokers, auditors, or other agents, (e) as otherwise permitted by the Operative
Agreements (as defined in Annex A to the Lease), or (f) to such other Persons as
are reasonably deemed necessary by the disclosing party for the purposes of
enforcing such documents by such party; PROVIDED that any such disclosure under
this sentence shall be made only to the extent necessary to meet the specific
requirements or needs of the Assignee or PM Limited, as the case may be. Any
disclosure as contemplated in (b), (c) or (d) above shall include a requirement
that the entity to which the information is disclosed shall be subject to
obligations of nondisclosure with respect to such information substantially the
same as those contained herein.




      Section 4. ASSIGNMENT TO MORTGAGEE. The right, title and interest of the
Assignee in and to this Assignment has, contemporaneously with the execution and
delivery hereof, been assigned to and is subject to a security interest in favor
of the Mortgagee (as such terms and the other capitalized terms used hereinafter
in this sentence are defined in Appendix A to the Lease) under the Trust
Indenture, for the benefit of the Loan Participants and the Note Holders
referred to the Trust Indenture, all to the extent provided in such Trust
Indenture. The Assignor hereby consents to such assignment and to the creation
of such security interest in and to this Assignment.

      Section 5. NOTICES. Any notices provided for in PAA No. 1 shall be
delivered to the Assignee at the following address or such other place as the
Assignee may designate in accordance with PAA No. 1:

                  Wells Fargo Bank Northwest,
                  National Association
                  MAC: U1228-120
                  Attn:  Corporate Trust Dept.
                  299 S. Main Street, 12th Floor
                  Salt Lake City, UT 84111
                  Facsimile:  801-246-5053

      Section 6. HEADINGS.  The headings of the Sections herein are for
convenience of reference only and shall not define or limit any of the
terms or provisions hereof.

      Section 7. GOVERNING LAW. THIS ASSIGNMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, UNITED STATES OF
AMERICA, WITHOUT REGARD TO CONFLICT OF LAWS RULES OTHER THAN SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW.

      Section 8. COUNTERPARTS. This Agreement and any amendments, waivers,
consents or supplements hereto may be executed in any number of counterparts (or
upon separate signature pages bound together into one or more 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.

      Section 9. PURCHASE AGREEMENT. The rights and obligations of the parties
hereto are subject to the terms and conditions of the Purchase Agreement.

            [Remainder of the Page is Intentionally Left Blank.]





      IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
duly executed as of the day and year first written above.


                                          PM LIMITED, as Assignor


                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:


                                          WELLS FARGO BANK
                                          NORTHWEST, NATIONAL
                                          ASSOCIATION, not in its
                                          individual capacity but solely as
                                          Owner Trustee, as Assignee


                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:







Annex 1 to Purchase
Agreement Assignment No. 2 - [Deal_]

                      CONSENT AND AGREEMENT NO. 2 - [DEAL_]

      The undersigned, EMBRAER-EMPRESA BRASILEIRA DE AERONAUTICA S.A., a
corporation organized and existing under the laws of Brazil, hereby acknowledges
notice of and consents to all of the terms of the foregoing Purchase Agreement
Assignment No. 2 - [Deal_], dated as of ________ ___, 2004, by and among PM
Limited and WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, not in its
individual capacity but solely as Owner Trustee, to the extent they relate to
the Manufacturer (herein called the "Assignment No. 2", the defined terms
therein being hereinafter used with the same meaning) and hereby confirms to the
Assignee that: (i) all representations, warranties, indemnities and agreements
of the Manufacturer under the Purchase Agreement with respect to the Aircraft
shall inure to the benefit of the Assignee to the same extent as if originally
named the "Buyer" therein, subject to the terms and conditions of the Assignment
No. 2, the Purchase Agreement and PAA No. 1; (ii) the Assignee shall not be
liable for any of the obligations or duties of Express under the Purchase
Agreement, nor shall the Assignment No. 2 give rise to any duties or obligations
whatsoever on the part of the Assignee owing to the Manufacturer except for the
Assignee's agreement to the effect that in exercising any rights under the
Purchase Agreement, or in making any claim with respect to the Aircraft or other
things (including without limitation data, documents and services) delivered or
to be delivered pursuant to the Purchase Agreement, the terms and conditions of
the Purchase Agreement shall apply to and be binding upon the Assignee to the
same extent as if the Assignee had been the original "Buyer" thereunder, and
with respect to such agreement the Manufacturer agrees that, anything contained
in the Purchase Agreement or the Assignment No. 2 to the contrary
notwithstanding, so long as the Manufacturer shall not have received notice that
a Lease Event of Default has occurred and is continuing, the Assignee shall not
have any responsibility to the Manufacturer for failure to comply with any of
the terms of the Purchase Agreement with respect to the Aircraft while under
lease to Continental so long as the Assignee acts upon the written instructions
of Express (or, if Continental shall have specified in a written notice to the
Assignee and the Manufacturer that Continental is entitled to possession of the
Aircraft, Continental) (to which instructions the Manufacturer understands it
shall have access on request); PROVIDED that no person other than the
Manufacturer shall have any rights against the Assignee with respect to the
undertaking and agreement set forth in this clause (ii); (iii) the Manufacturer
will continue to pay to Express (or, if Continental shall have specified in a
written notice to the Assignee and the Manufacturer that Continental is entitled
to possession of the Aircraft, Continental) all payments which the Manufacturer
may be required to make in respect of the Aircraft under the Purchase Agreement
unless and until the Manufacturer shall have received written notice addressed
to its Contracts Administrator, by mail to EMBRAER-Empresa Brasileira de
Aeronautica S.A., Av. Brigadeiro Faria Lima, 2170, 12.227-901 Sao Jose dos
Campos-SP, Brazil, or by fax to fax no: 55 12-3927-1257, that a Lease Event of
Default has occurred and is continuing (which such notice from the Assignee
shall be conclusive proof thereof to the Manufacturer and as to which the



Manufacturer shall have no obligation to inquire), whereupon the Manufacturer
will, until the Manufacturer shall have received notice in writing sent or
addressed as aforesaid that no Lease Event of Default exists, make any and all
payments and take any and all actions which it may be required thereafter to
make or take in respect of the Aircraft under the Purchase Agreement and the
right to receive which has been assigned under the Assignment No. 2 directly to
the Assignee at its address at MAC: U1228-120, 299 S. Main Street, 12th Floor,
Salt Lake City, Utah 84111 , telecopy no. 801-246-5053; (iv) from and after the
delivery of the Aircraft on the Delivery Date, the Manufacturer will not assert
any lien or claim against the Aircraft or any part thereof arising with respect
to or in connection with any work or other services performed before the
delivery and acceptance of the Aircraft; and (v) the Manufacturer consents to
the grant of a security interest in the Purchase Agreement pursuant to the Trust
Indenture (as defined in Appendix A to the Lease).

      The Manufacturer hereby represents and warrants that (A) the Manufacturer
is a corporation duly organized and existing in good standing under the laws of
Brazil, (B) the making and performance of the Purchase Agreement have been duly
authorized by all necessary corporate action on the part of the Manufacturer, do
not require any stockholder approval, do not contravene the Manufacturer's
By-Laws or any indenture, credit agreement or other contractual agreement to
which the Manufacturer is a party or by which it is bound, and the making of the
Purchase Agreement does not contravene any law binding on the Manufacturer, (C)
the making and performance of this Consent and Agreement have been duly
authorized by all necessary corporate action on the part of the Manufacturer, do
not require any stockholder approval and do not contravene any law binding on
the Manufacturer or contravene the Manufacturer's By-laws or any indenture,
credit agreement or other contractual agreement to which the Manufacturer is a
party or by which it is bound, (D) the Purchase Agreement constituted as of the
date thereof and at all times thereafter to and including the date of this
Consent and Agreement constitutes a binding obligation of the Manufacturer
enforceable against the Manufacturer in accordance with its terms subject to:
(i) the limitations of applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the rights of creditors generally) and (ii)
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and (E) this Consent and
Agreement is a binding obligation of the Manufacturer enforceable against the
Manufacturer in accordance with its terms subject to: (a) the limitations of
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally; and (b) general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law). It is understood that the execution by the Manufacturer of
this Consent and Agreement is subject to the condition that concurrently with
execution and delivery hereof the Aircraft will be leased to Continental under
the Lease Agreement.

      [The remainder of this page has been left blank intentionally.]






      This Consent and Agreement shall be governed by the laws of the State of
New York, including all matters of construction, validity and performance, as
applicable to contracts between citizens of the state to be performed wholly
within that state, and without regard to conflicts of law rules other than
Section 5-1401 of the New York General Obligations Law.

      Dated as of _______ ___, 2004.

                                    EMBRAER-EMPRESA BRASILEIRA
                                    DE AERONAUTICA S.A.



                                    By
                                      ------------------------------------------
                                      Title:



                                    By
                                      ------------------------------------------
                                      Title:





                                  EXHIBIT E to
                             NOTE PURCHASE AGREEMENT

                             FORM OF TRUST AGREEMENT

                               (Filed Separately)



                                    EXHIBIT F
                           TO NOTE PURCHASE AGREEMENT


                                 DELIVERY NOTICE


                                Dated as of [__]



To each of the addressees listed
      in Schedule A hereto

            RE:   DELIVERY NOTICE IN ACCORDANCE WITH NOTE
                  PURCHASE AGREEMENT REFERRED TO BELOW

Ladies and Gentlemen:

      Reference  is made to the Note  Purchase  Agreement,  dated as of June 29,
2004,  among  Continental  Airlines,  Inc.  (the  "COMPANY"),  Wilmington  Trust
Company,  as Pass Through  Trustee  under the Pass Through  Trust  Agreement (as
defined  therein) (the "PASS THROUGH  TRUSTEE"),  Wilmington  Trust Company,  as
Subordination  Agent (the  "SUBORDINATION  AGENT"),  Wells Fargo Bank Northwest,
National Association,  as Escrow Agent (the "ESCROW AGENT") and Wilmington Trust
Company,  as Paying Agent (the "PAYING  AGENT") (as in effect from time to time,
the "NOTE PURCHASE  AGREEMENT").  Unless otherwise  defined herein,  capitalized
terms  used  herein  shall  have the  meanings  set  forth in the Note  Purchase
Agreement or, to the extent not defined therein, the Intercreditor Agreement.

      Pursuant to Section 1(b) of the Note Purchase  Agreement,  the undersigned
hereby  notifies  you, in respect of the Embraer  Model EMB-145 XR aircraft with
manufacturer's serial number [MSN] (the "AIRCRAFT"), of the following:

(1)   The Scheduled Closing Date of the Aircraft is [_________]; and

(2)   The principal amount of the Equipment Notes to be issued, and purchased by
      the Pass  Through  Trustee on  such Scheduled  Closing Date, in connection
      with the financing of such Aircraft is $[_______].


      The Company  hereby  instructs  the Pass Through  Trustee to (i) execute a
Withdrawal Certificate in the form of Annex A hereto dated as of [__________]



and attach  thereto a Notice of Purchase Withdrawal dated such date completed as
set forth on  Exhibit A hereto  and (ii) deliver such Withdrawal Certificate and
Notice of Purchase Withdrawal to the Escrow Agent.1

      The Company  hereby  instructs  the Pass  Through  Trustee to (i) purchase
Equipment Notes in an amount set forth in clause (2) above with a portion of the
proceeds [of the  withdrawals of Deposits  referred to in the Notice of Purchase
Withdrawal  referred to above]2 [received on the Scheduled Closing Date from the
Underwriters]3  and (ii)  re-deposit  with the Depositary any amount not used on
the Scheduled Closing Date to purchase Equipment Notes.

      The Company  hereby  instructs the Pass Through  Trustee to (a) enter into
the Participation  Agreement [TN] dated as of [__________] among the Company, as
Lessee, Wilmington Trust Company, as Mortgagee and Loan Participant, Wells Fargo
Bank Northwest, National Association, as Owner Trustee and Lessor, [_______], as
Owner Participant,  and Embraer-Empresa  Brasileira de Aeronautica,  (b) perform
its  obligations  thereunder  and (c) deliver such  certificates,  documents and
legal opinions relating to the Pass Through Trustee as required thereby.

Yours faithfully,

Continental Airlines, Inc.


By:
    -------------------------
    Name:
    Title:



















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

1. Eliminate if the Scheduled Closing Date is the Issuance Date.

2. Eliminate if the Scheduled Closing Date is the Issuance Date.

3. Insert if the Scheduled Closing Date is the Issuance Date.




                                   SCHEDULE A

Wilmington Trust Company, as
  Pass Through Trustee, Subordination
  Agent and Paying Agent
Rodney Square North
1100 North Market Street
Wilmington, Delaware  19890
Attention:  Corporate Trust Administration
Facsimile:  (302) 651-8882

Wells Fargo Bank Northwest, National Association,
 MAC:U1228-120 as Escrow Agent
299 South Main Street, 12th Floor
Salt Lake City, Utah  84111
Attention:  Corporate Trust Services
Facsimile:  (801) 246-5053

WestLB AG, New York Branch, as Depositary
1211 Avenue of the Americas
New York, New York 10036
Attention:  Brigitte Thieme
Facsimile:  (212) 869-7634
Attention:  Eugene Chan
Facsimile:  (212) 852-6305


Standard & Poor's Ratings Services
55 Water Street, 35th Floor
New York, New York 10004
Attention:  Michael K. Vernier
Facsimile:  (212) 438-6632

Moody's Investors Service, Inc.
99 Church Street
New York, New York  10007
Attention:  Richard Bittenbender
Facsimile:  (212) 553-3855








                                                                         Annex A


                             WITHDRAWAL CERTIFICATE


                Wells Fargo Bank Northwest, National Association
                                 as Escrow Agent

Ladies and Gentlemen:

            Reference is made to the Escrow and Paying Agent Agreement, dated as
of June 29, 2004 (the "Agreement"). We hereby certify to you that the conditions
to the  obligations  of the  undersigned  to execute a  Participation  Agreement
pursuant to the Note Purchase Agreement have been satisfied. Pursuant to Section
1.02(c)  of the  Agreement,  please  execute  the  attached  Notice of  Purchase
Withdrawal and  immediately  transmit by facsimile to the  Depositary,  at (212)
869-7634  (Attention:  Brigitte  Thieme) and (212) 852-6305  (Attention:  Eugene
Chan).  Capitalized  terms used  herein but not  defined  herein  shall have the
meanings set forth in the Agreement.



                                    Very truly yours,

                                    WILMINGTON TRUST COMPANY,
                                    not in its individual capacity but
                                    solely as Pass Through Trustee


                                    By:
                                       -----------------------------------------
                                       Name:
                                       Title:



Dated:  As of ____________, 200_




                                                                       Exhibit A


                          NOTICE OF PURCHASE WITHDRAWAL



WestLB AG, New York Branch
1211 Avenue of the Americas
New York, New York 10036
Attention:  Brigitte Thieme
Facsimile:  (212) 869-7634
Attention:  Eugene Chan
Facsimile:  (212) 852-6305


Ladies and Gentlemen:

            Reference is made to the Deposit Agreement dated as of June 29, 2004
(the  "DEPOSIT   AGREEMENT")  between  Wells  Fargo  Bank  Northwest,   National
Association, as Escrow Agent, and WestLB AG, New York Branch, as Depositary (the
"DEPOSITARY").

            In  accordance  with Section  2.3(a) of the Deposit  Agreement,  the
undersigned  hereby requests the withdrawal of the entire amount of the Deposit,
$[_______], Account No. [____________].

            The undersigned hereby directs the Depositary to pay the proceeds of
the Deposit to [________________],  Account No. [_____], Reference:  [_________]
on [_________ __, 200__], upon the telephonic request of a representative of the
Pass Through Trustee.


                                          WELLS FARGO BANK NORTHWEST, NATIONAL
                                             ASSOCIATION,
                                             as Escrow Agent


                                          By
                                            ------------------------------------
                                             Name:
                                             Title:

Dated: As of _______ __, 200_



           ----------------------------------------------------------
           | CONFIDENTIAL: SUBJECT TO RESTRICTIONS ON DISSEMINATION |
           |        SET FORTH IN SECTION 8 OF THIS AGREEMENT        |
           ----------------------------------------------------------

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

                          PARTICIPATION AGREEMENT [TN]
                                Dated as of [DD]

                                      Among

                           CONTINENTAL AIRLINES, INC.,
                                     Lessee,

                                      [OP],
                               Owner Participant,

                WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION,
                         Not in its individual capacity
                      except as expressly provided herein,
                          but solely as owner trustee,
                            Owner Trustee and Lessor


                            WILMINGTON TRUST COMPANY,
                         Not in its individual capacity
                      except as expressly provided herein,
                  but solely as Mortgagee, Subordination Agent
               under the Intercreditor Agreement, and Pass Through
                 Trustee under the Pass Through Trust Agreement,
                         Mortgagee and Loan Participant,

                                       and

                 EMBRAER-EMPRESA BRASILEIRA DE AERONAUTICA S.A.
                              Airframe Manufacturer
                          ----------------------------

                      One Embraer Model EMB-145 XR Aircraft
                     Bearing Manufacturer's Serial No. [MSN]
                        and U.S. Registration No. N[REG]
                    with Two Allison Model AE3007A1E Engines



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



                                    CONTENTS

SECTION 1.  DEFINITIONS AND CONSTRUCTION.....................................2

[SECTION 2. ISSUANCE OF EQUIPMENT NOTES; TERMINATION OF
            OBLIGATION TO PARTICIPATE........................................2
      2.1   Issuance of Equipment Notes......................................2
      2.2   Termination of Obligation to Participate.........................2

SECTION 3.  TERMINATION OF EXISTING FINANCING AGREEMENTS;
            COMMITMENT TO LEASE AIRCRAFT.....................................3
      3.1   Termination of Existing Financing Agreements.....................3
      3.2   Commitment to Lease..............................................3

SECTION 4.  CLOSING; PROCEDURE FOR PAYMENT; POSTPONEMENT OF
            SCHEDULED CLOSING DATE...........................................3
      4.1   Closing..........................................................3
      4.2   Payment of Proceeds..............................................4
      4.3   Postponement of Scheduled Closing Date...........................4

SECTION 2.  PARTICIPATION IN LESSOR'S COST; ISSUANCE OF EQUIPMENT
            NOTES; TERMINATION OF OBLIGATION TO PARTICIPATE..................5
      2.1   Participation in Lessor's Cost...................................5
      2.2   Nature of Obligations of Participants............................5
      2.3   Termination of Obligation to Participate.........................5

SECTION 3.  COMMITMENT TO LEASE AIRCRAFT.....................................5

SECTION 4.  PROCEDURE FOR PARTICIPATION IN PAYMENT OF LESSOR'S
            COST; POSTPONEMENT OF SCHEDULED DELIVERY DATE....................6
      4.1   Closing..........................................................6
      4.2   Payment of Lessor's Cost.........................................6
      4.3   Postponement of Scheduled Closing Date...........................7

SECTION 5.  CONDITIONS PRECEDENT.............................................7
      5.1   Conditions Precedent to Obligations of Participants..............7
      5.2   Conditions Precedent to Obligations of Owner Trustee............13
      5.3   Conditions Precedent to Obligations of Mortgagee................14
      5.4   Conditions Precedent to Obligations of Lessee...................14
      5.5   Post-Registration Opinion.......................................15

SECTION 6.  REPRESENTATIONS AND WARRANTIES..................................15
      6.1   Lessee's Representations and Warranties.........................15
      6.2   Owner Participant's Representations and Warranties..............18
      6.3   Wells Fargo's Representations and Warranties....................20
      6.4   WTC's Representations and Warranties............................23
      6.5   Airframe Manufacturer's Representations and Warranties..........26



SECTION 7.  COVENANTS, UNDERTAKINGS AND AGREEMENTS..........................28
      7.1   Covenants of Lessee.............................................28
      7.2   Covenants of Owner Participant..................................30
      7.3   Covenants of Wells Fargo and Owner Trustee......................32
      7.4   Covenants of WTC................................................34
      7.5   Covenants of Note Holders.......................................35
      7.6   Agreements......................................................36

SECTION 8.  CONFIDENTIALITY.................................................42

SECTION 9.  INDEMNIFICATION AND EXPENSES....................................42
      9.1   General Indemnity...............................................42
      9.2   Expenses........................................................48
      9.3   General Tax Indemnity...........................................48
      9.4   Payments........................................................58
      9.5   Interest........................................................58
      9.6   Benefit of Indemnities..........................................58

SECTION 10. ASSIGNMENT OR TRANSFER OF INTERESTS.............................58
      10.1  Participants, Owner Trustee and Note Holders....................58
      10.2  Effect of Transfer..............................................60

SECTION 11. [RESERVED]......................................................60

SECTION 12. SECTION 1110....................................................60

SECTION 13. CHANGE OF CITIZENSHIP...........................................61
      13.1  Generally.......................................................61
      13.2  Owner Participant...............................................61
      13.3  Owner Trustee...................................................61
      13.4  Mortgagee.......................................................62

SECTION 14. CONCERNING OWNER TRUSTEE........................................62

SECTION 15. MISCELLANEOUS...................................................62
      15.1  Amendments......................................................62
      15.2  Severability....................................................62
      15.3  Survival........................................................63
      15.4  Reproduction of Documents.......................................63
      15.5  Counterparts....................................................63
      15.6  No Waiver.......................................................63
      15.7  Notices.........................................................63
      15.8  GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE................64
      15.9  Third-Party Beneficiary.........................................65
      15.10 Entire Agreement................................................65
      15.11 Further Assurances..............................................65



ANNEX, SCHEDULES AND EXHIBITS

ANNEX A -         Definitions

SCHEDULE 1     -  Accounts; Addresses
SCHEDULE 2     -  Commitments
SCHEDULE 3     -  Certain Terms

EXHIBIT A      -  Opinion of special counsel to Lessee
EXHIBIT B      -  Opinion of corporate counsel to Lessee
EXHIBIT C-1    -  Opinion of corporate counsel to Airframe Manufacturer
EXHIBIT C-2    -  Opinion of special counsel to Airframe Manufacturer
EXHIBIT D      -  Opinion of special counsel to Owner Trustee
EXHIBIT E      -  Opinion of special counsel to Mortgagee
EXHIBIT F      -  Opinion of special counsel to Owner Participant
EXHIBIT G      -  Opinion of special counsel in Oklahoma City, Oklahoma
EXHIBIT H      -  Opinion of special counsel to Seller



                          PARTICIPATION AGREEMENT [TN]

      PARTICIPATION AGREEMENT [TN], dated as of [DD] (this "Agreement"), among
(a) CONTINENTAL AIRLINES, INC., a Delaware corporation ("Lessee"), (b) [OP], a
corporation organized under the laws of the OP Jurisdiction ("Owner
Participant"), (c) WELLS FARGO BANK NORTHWEST, NATIONAL ASSOCIATION, a national
banking association, not in its individual capacity, except as expressly
provided herein, but solely as Owner Trustee (this and all other capitalized
terms used but not defined herein shall have the respective meanings ascribed
thereto in Section 1) (in its capacity as Owner Trustee, "Owner Trustee" or
"Lessor", and in its individual capacity, "Wells Fargo"), (d) WILMINGTON TRUST
COMPANY, a Delaware banking corporation, not in its individual capacity, except
as expressly provided herein, but solely as Mortgagee (in its capacity as
Mortgagee, "Mortgagee" and in its individual capacity, "WTC"), (e) WILMINGTON
TRUST COMPANY, not in its individual capacity, except as expressly provided
herein, but solely as Pass Through Trustee under the Pass Through Trust
Agreement ("Pass Through Trustee"), (f) WILMINGTON TRUST COMPANY, not in its
individual capacity, except as expressly provided herein, but solely as
Subordination Agent under the Intercreditor Agreement ("Subordination Agent"),
and (g) EMBRAER-EMPRESA BRASILEIRA DE AERONAUTICA S.A., a company organized
under the laws of Brazil ("Airframe Manufacturer").

                                    RECITALS

      A. Express and Airframe Manufacturer have entered into the Purchase
Agreement, pursuant to which, among other things, Airframe Manufacturer has
agreed to manufacture and sell to Express and Express has agreed to purchase
from Airframe Manufacturer certain aircraft, including the Aircraft.

      [B. Prior to the date hereof, in connection with the interim financing of
the Aircraft, (i) certain of Express' rights under the Purchase Agreement with
respect to the Aircraft were assigned to Lessor and (ii) the Aircraft was
purchased by Lessor, leased to Lessee pursuant to the Existing Lease and
subleased to Express pursuant to the Existing Sublease.]1

      [B. On the Delivery Date, Express and Seller will enter into the Initial
Purchase Agreement Assignment and Seller and Owner Trustee will enter into the
Purchase Agreement Assignment, pursuant to which, among other things, Express'
right to purchase the Aircraft from Airframe Manufacturer will be assigned to
Seller and reassigned to the Owner Trustee upon and subject to the terms and
conditions set forth in the Purchase Agreement, the Initial Purchase Agreement
Assignment and the Purchase Agreement Assignment.]2

      C. In order to effectuate the long-term financing of the Aircraft, the
parties hereto intend that (i) the Owner Trustee issue, on a non-recourse basis,
pursuant to the Trust Indenture the Equipment Notes to the Pass Through Trustee,
[(ii) the Existing Lease be terminated and replaced with the Lease, and the


- --------

1. Delete for New Aircraft.

2. Insert for New Aircraft.



Aircraft continue to be leased to Lessee and subleased to Express]3 [(ii) the
Owner Trustee will purchase the Aircraft from the Airframe Manufacturer
utilizing the Commitments and lease it to Lessee pursuant to the Lease and the
Lessee will sublease the Aircraft to Express]4 and (iii) Owner Trustee grant a
security interest to Mortgagee in the Aircraft and the Lease for the benefit of
the Note Holders.

      D. The parties hereto wish to set forth in this Agreement the terms and
conditions upon and subject to which the aforesaid transactions shall be
effected.

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

SECTION 1.     DEFINITIONS AND CONSTRUCTION

      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.

[SECTION 2.    ISSUANCE OF EQUIPMENT NOTES; TERMINATION OF
               OBLIGATION TO PARTICIPATE

      2.1      ISSUANCE OF EQUIPMENT NOTES

      Subject to the terms and conditions of this Agreement, on the Closing
Date, the Pass Through Trustee shall make a non-recourse secured loan to Owner
Trustee to finance, in part, the Owner Trustee's payment of Lessor's Cost in the
amount in Dollars equal to the Pass Through Trustee's PTT Percentage multiplied
by Lessor's Cost, such loan to be evidenced by one or more Equipment Notes,
dated the Closing Date, issued to the Subordination Agent as the registered
holder on behalf of the Pass Through Trustee for the Pass Through Trust by Owner
Trustee in accordance with this Agreement and the Trust Indenture, in an
aggregate principal amount equal to the Commitment of the Pass Through Trustee.

      2.2      TERMINATION OF OBLIGATION TO PARTICIPATE

      Notwithstanding any other provision of this Agreement, if the Closing does
not occur on or before the Commitment Termination Date, the Commitment of the
Loan Participant and its obligation to participate in the payment of Lessor's
Cost shall expire and be of no further force and effect; PROVIDED, that the
liability of the Loan Participant that has defaulted in the payment of its
Commitment shall not be released.]5


- --------

3. Delete for New Aircraft.

4. Insert for New Aircraft.

5. Delete for New Aircraft.



[SECTION 3.    TERMINATION OF EXISTING FINANCING AGREEMENTS; COMMITMENT TO
               LEASE AIRCRAFT

      3.1      TERMINATION OF EXISTING FINANCING AGREEMENTS

      (a) The Existing Lease and Existing Sublease for the Aircraft shall be
terminated in order to be replaced by the Lease and the Express Sublease, and
each of Lessor and Lessee shall take such action to evidence such termination as
Owner Trustee or Mortgagee shall reasonably request, including execution and
delivery of a termination agreement for the Existing Lease and Existing Sublease
in form and substance reasonably acceptable to Owner Trustee and satisfactory
for filing with the FAA, and UCC-3 termination statements with respect to the
termination of the Existing Lease and Existing Sublease.

      (b) The Existing Participation Agreement shall be terminated, effective as
of the Closing, and the parties thereto shall have no further obligation
thereunder except for Sections 7, 10 and 11 thereof and for any breach of such
Agreement arising prior to the Closing.

      (c) Lessor shall refund to Lessee "Basic Rent" (as defined in the Existing
Lease) paid in advance by Lessee attributable to periods on and after the
Closing Date determined by multiplying such Basic Rent by a fraction, the
numerator of which shall be the number of days remaining in the month in which
the Closing Date occurs (from and including the Closing Date) and the
denominator of which shall be the total number of days in such month.

      (d) Airframe Manufacturer shall pay and discharge all applicable sales,
use or similar Taxes, duties or fees assessed or levied by any federal, state,
provincial or local taxing authority as a result of the replacement of the
existing financing agreements with the Operative Agreements and the Express
Sublease or issuance of the Equipment Notes contemplated by this Agreement.
Owner Trustee and Lessee will cooperate in order to minimize Taxes applicable to
the termination of the existing financing agreements or issuance of the
Equipment Notes contemplated by this Agreement.

      3.2      COMMITMENT TO LEASE

      Subject to the terms and conditions of this Agreement, concurrently with
the issuance of the Equipment Notes, Owner Trustee shall continue the lease of
the Aircraft to Lessee, and Lessee shall continue the lease of the Aircraft from
Owner Trustee, under the Lease.]6

[SECTION 4.    CLOSING; PROCEDURE FOR PAYMENT; POSTPONEMENT OF SCHEDULED
               CLOSING DATE

      4.1      CLOSING

      The Closing shall occur at the offices of Hughes Hubbard & Reed LLP, One
Battery Park Plaza, New York, New York 10004, or such other place as the parties
shall agree, at the time specified pursuant to notice given in accordance with
Section 1 of the Note Purchase Agreement.


- --------

6. Delete for New Aircraft.



      4.2      PAYMENT OF PROCEEDS

      (a) The Loan Participant agrees, subject to the terms and conditions of
this Agreement, to make the Dollar amount of its Commitment available, by wire
transfer of immediately available funds to the account of WTC, ABA No.
031100092, Account No. [ ], reference Continental Lease [TN], at or before 12:00
Noon, New York City time, on the Scheduled Closing Date. All such funds made
available by the Loan Participant to WTC shall, until payment thereof to Owner
Trustee as provided in Section 4.2(c) or return thereof to the Loan Participant
as provided in Section 4.3, be held by WTC in trust for the benefit of the Loan
Participant, as the sole and exclusive property of the Loan Participant and not
as part of the Trust Estate or the Trust Indenture Estate.

      (b) Subject to the satisfaction or waiver by the applicable party of the
conditions precedent set forth in Section 5, and simultaneously with the receipt
by the parties hereto of all amounts to be paid to them on the Closing Date
pursuant to this Section 4.2, Owner Trustee shall:

            (i) execute the Trust Indenture and the initial Trust Indenture
      Supplement and issue the Equipment Notes to the Subordination Agent in
      accordance with Section 2.1(b);

            (ii) lease the Aircraft to Lessee pursuant to the Lease; and

            (iii) take such other action as may be required to be taken by the
      Owner Trustee on the Closing Date by the terms of any Operative Agreement.

      (c) Subject to the satisfaction or waiver by the applicable party of the
conditions precedent set forth in Section 5, WTC shall pay to the Owner Trustee
the amounts received from the Loan Participants pursuant to Section 4.2(a).

      4.3      POSTPONEMENT OF SCHEDULED CLOSING DATE

      If for any reason whatsoever the Closing is not consummated on the
Scheduled Closing Date, Airframe Manufacturer may by telephonic notice, given by
5:00 p.m., New York City time (such telephonic notice to be promptly confirmed
in writing by personal delivery or facsimile), on the Scheduled Closing Date to
Lessee, the Loan Participant, Owner Trustee and Mortgagee, designate a Delayed
Closing Date, in which case any funds made available by the Loan Participant
shall be returned on such Scheduled Closing Date and the Loan Participant shall
comply with its obligations under Section 2.02(b) of the Trust Supplement.]7


- --------

7. Delete for New Aircraft.



[SECTION 2.    PARTICIPATION IN LESSOR'S COST; ISSUANCE OF EQUIPMENT NOTES;
               TERMINATION OF OBLIGATION TO PARTICIPATE

      2.1      PARTICIPATION IN LESSOR'S COST

      Subject to the terms and conditions of this Agreement, on the Closing
Date, Owner Participant and the Pass Through Trustee shall participate in the
payment of Lessor's Cost as follows:

      (a) Owner Participant shall participate in the payment of Lessor's Cost
for the Aircraft by making an equity investment in the beneficial ownership of
the Aircraft in the amount in Dollars equal to Owner Participant's Percentage
multiplied by Lessor's Cost; and

      (b) The Pass Through Trustee shall make a non-recourse secured loan to
Owner Trustee to finance, in part, the Owner Trustee's payment of Lessor's Cost
in the amount in Dollars equal to the Pass Through Trustee's PTT Percentage
multiplied by Lessor's Cost, such loan to be evidenced by one or more Equipment
Notes, dated the Closing Date, issued to the Subordination Agent as the
registered holder on behalf of each Pass Through Trustee for the Pass Through
Trust by Owner Trustee in accordance with this Agreement and the Trust
Indenture, in an aggregate principal amount equal to the Commitment of the Pass
Through Trustee.

      2.2      NATURE OF OBLIGATIONS OF PARTICIPANTS

      The obligations hereunder of each Participant are several, and not joint,
and a Participant shall have no obligation to make available to Owner Trustee
any portion of any amount not paid hereunder by any other Participant. The
failure by either Participant to perform its obligations hereunder shall not
affect the obligations of Lessee toward the other Participant, except to the
extent provided in Section 5.4.

      2.3      TERMINATION OF OBLIGATION TO PARTICIPATE

      Notwithstanding any other provision of this Agreement, if the Closing does
not occur on or before the Commitment Termination Date, the Commitment of each
Participant and its obligation to participate in the payment of Lessor's Cost
shall expire and be of no further force and effect; provided, that the liability
of any Participant that has defaulted in the payment of its Commitment shall not
be released.]8

[SECTION 3.    COMMITMENT TO LEASE AIRCRAFT

      Subject to the terms and conditions of this Agreement, concurrently with
the issuance of the Equipment Notes, Owner Trustee shall purchase and accept
delivery of the Aircraft under and pursuant to the Purchase Agreement and the


- --------

8. Insert for New Aircraft.



Purchase Agreement Assignment, and thereupon Owner Trustee shall lease the
Aircraft to Lessee, and Lessee shall lease the Aircraft from Owner Trustee,
under the Lease.]9

[SECTION 4.    PROCEDURE FOR PARTICIPATION IN PAYMENT OF LESSOR'S COST;
               POSTPONEMENT OF SCHEDULED DELIVERY DATE

      4.1      CLOSING

      The Closing shall occur at the offices of Hughes Hubbard & Reed LLP, One
Battery Park Plaza, New York, New York 10004, or such other place as the parties
shall agree at the time specified pursuant to notice given in accordance with
Section 1 of the Note Purchase Agreement.

      4.2      PAYMENT OF LESSOR'S COST

      (a) Each Participant agrees, subject to the terms and conditions of this
Agreement, to make the Dollar amount of its respective Commitment available, by
wire transfer of immediately available funds to the account of WTC, ABA No.
031100092, Account No. [_____], reference Continental Lease [TN], at or before
12:00 Noon, New York City time, on the Scheduled Closing Date. All such funds
made available by each Participant to WTC shall, until payment thereof to
Airframe Manufacturer as provided in Section 4.2(b)(ii) or return thereof to the
respective Participant as provided in Section 4.3.2, be held by WTC in trust for
the benefit of the respective Participant, as the sole and exclusive property of
the respective Participant and not as part of the Trust Estate or the Trust
Indenture Estate.

      (b) Subject to the satisfaction or waiver by the applicable party of the
conditions precedent set forth in Section 5, and simultaneously with the receipt
by the parties hereto of all amounts to be paid to them on the Closing Date
pursuant to this Section 4.2, Owner Trustee shall:

            (i) purchase, take title to, and accept delivery of, the Aircraft;

            (ii) in consideration of the transfer of title to the Aircraft to
      Owner Trustee, direct WTC to pay Lessor's Cost, from the funds made
      available to WTC hereunder by the Participants, to Airframe Manufacturer,
      by wire transfer of immediately available funds to Airframe Manufacturer's
      account set forth in Schedule 1;

            (iii) execute an application for registration of the Aircraft with
      the FAA and Lease Supplement No. 1, in each case with respect to the
      Aircraft;

            (iv) execute the Trust Indenture and the initial Trust Indenture
      Supplement and issue the Equipment Notes to the Subordination Agent in
      accordance with Section 2.1(b);

            (v) lease the Aircraft to Lessee, pursuant to the Lease; and


- --------

9. Insert for New Aircraft.



            (vi) take such other action as may be required to be taken by the
      Owner Trustee on the Closing Date by the terms of any Operative Agreement.

      4.3      POSTPONEMENT OF SCHEDULED CLOSING DATE

               4.3.1    POSTPONEMENT

      If for any reason whatsoever the Closing is not consummated on the
Scheduled Closing Date, Airframe Manufacturer may, by telephonic notice, given
by 5:00 p.m., New York City time (such telephonic notice to be promptly
confirmed in writing by personal delivery or facsimile), on the Scheduled
Closing Date to Lessee, each Participant, Owner Trustee and Mortgagee, designate
a Delayed Closing Date, in which case the Owner Participant will make its funds
available to WTC on the Delayed Closing Date in accordance with Section 4.2(a),
and the Loan Participant shall comply with its obligations under Section
[2.02(b)] of the Trust Supplement.

               4.3.2    RETURN OF FUNDS

      WTC shall promptly return to each Participant that makes funds available
to it in accordance with Section 4.2(a) such funds, if the Closing fails to
occur on the Scheduled Delivery Date.]10

SECTION 5.     CONDITIONS PRECEDENT

      5.1      CONDITIONS PRECEDENT TO OBLIGATIONS OF PARTICIPANTS

      The obligation of [each]11 [the Loan]12 Participant to make the Dollar
amount of its Commitment available for payment as directed by the Owner Trustee
on the Closing Date and of each Participant to take the other actions required
by this Agreement to be taken by it at the Closing is subject to satisfaction or
waiver by each such Participant, at or prior to the Closing, of the conditions
precedent set forth below in this Section 5.1; PROVIDED, that it shall not be a
condition precedent to the obligation of any Participant that any document be
produced or action taken that is to be produced or taken by such Participant or
by a Person within such Participant's control; PROVIDED, FURTHER, that Section
5.1.2(iii) [and (xv)]13 shall not be conditions precedent to the obligation of
Loan Participant, and Section 5.1.5 shall not be a condition precedent to the
obligation of Owner Participant.


- --------

10. Insert for New Aircraft.

11. Insert for New Aircraft.

12. Delete for New Aircraft.

13. Delete for New Aircraft.



               5.1.1       NOTICE

      Such Participant shall have received the notice described in Section 4.1
or, in the case of a Delayed Closing Date, 4.3, when and as required thereby, or
shall have waived such notice.

               5.1.2       DELIVERY OF DOCUMENTS

      Such Participant shall, except as noted below, have received executed
counterparts of the following agreements, instruments, certificates or
documents, and each of such counterparts (a) shall have been duly authorized,
executed and delivered by the respective party or parties thereto, (b) shall be
reasonably satisfactory in form and substance to such Participant and (c) shall
be in full force and effect:

            (i) the Lease; PROVIDED, that only Mortgagee shall receive the sole
      executed chattel paper original thereof;

            (ii) Lease Supplement No. 1; PROVIDED, that only Mortgagee shall
      receive the sole executed chattel paper original thereof;

            (iii) the Tax Indemnity Agreement; PROVIDED, that only Owner
      Participant and Lessee shall receive copies of the Tax Indemnity
      Agreement;

            (iv) the Trust Agreement;

            (v)  the Trust Indenture;

            (vi) the initial Trust Indenture Supplement;

            (vii) [the Initial Purchase Agreement Assignment and]14 the Purchase
      Agreement Assignment;

            (viii) the Consent and Agreement;

            (ix) the Equipment Notes dated the Closing Date; PROVIDED, that only
      the Subordination Agent shall receive the authenticated Equipment Notes;

            (x) an excerpted copy of the Purchase Agreement to the extent
      relating to Airframe Manufacturer's warranties or related obligations or
      any right in the Purchase Agreement assigned to Owner Trustee pursuant to
      the Purchase Agreement Assignment; PROVIDED, that only Owner Trustee and
      Mortgagee shall receive copies of such agreements (copies of which may be
      inspected by Participants and their respective special counsel on the
      Closing Date, but after the Closing Date such copies shall be retained by
      Owner Trustee and Mortgagee and may be inspected and reviewed by Owner
      Participant or Loan Participant or their respective counsel if and only if
      there shall have occurred and be continuing a Lease Default or Lease Event
      of Default);


- --------

14. Insert for New Aircraft.



            [(xi) the OP Guaranty;]15

            (xii) the Express Sublease;

            (xiii) the broker's report and insurance certificates required by
      Section 11 of the Lease;

            [(xiv) termination agreements with respect to the Existing Lease and
      the Existing Sublease and, in the case of Owner Participant and Lessee,
      the Existing Participation Agreement and the "Tax Indemnity Agreement" as
      defined in the Existing Lease;]16

            [(xv) the Satisfaction and Discharge Agreement, dated as of the date
      of the Participation Agreement, among the Airframe Manufacturer, Seller,
      Owner Participant and Owner Trustee;]17

            [(xiv) the Bills of Sale;]18

            [(xv) an invoice from Seller to Owner Trustee in respect of the
      Aircraft;]19

            (xvi) (A) a copy of the Certificate of Incorporation and By-Laws of
      Lessee and resolutions of the board of directors of Lessee and/or the
      executive committee thereof, in each case certified as of the Closing
      Date, by the Secretary or an Assistant Secretary of Lessee, duly
      authorizing the execution, delivery and performance by Lessee of the
      Lessee Operative Agreements required to be executed and delivered by
      Lessee on or prior to the Closing Date in accordance with the provisions
      hereof and thereof; (B) an incumbency certificate of Lessee, Airframe
      Manufacturer, Owner Participant, Wells Fargo and WTC as to the person or
      persons authorized to execute and deliver the relevant Operative
      Agreements on behalf of such party; and (C) a copy of the Certificate of
      Incorporation or Articles of Incorporation and By-Laws and general
      authorizing resolutions of the boards of directors (or executive
      committees) or other satisfactory evidence of authorization of Airframe
      Manufacturer, Owner Participant, Wells Fargo and WTC, certified as of the
      Closing Date by the Secretary or an Assistant or Attesting Secretary of
      Airframe Manufacturer, Owner Participant, Wells Fargo and WTC,
      respectively, which authorize the execution, delivery and performance by
      Airframe Manufacturer, Owner Participant, Wells Fargo and WTC,
      respectively, of each of the Operative Agreements to which it is a party,
      together with such other documents and evidence with respect to it as
      Lessee or any Participant may reasonably request in order to establish the


- --------

15. Include if the OP is an Affiliate of Airframe Manufacturer.

16. Delete for New Aircraft.

17. Delete for New Aircraft.

18. Insert for New Aircraft.

19. Insert for New Aircraft.



      consummation of the transactions contemplated by this Agreement and the
      taking of all corporate proceedings in connection therewith;

            (xvii) an Officer's Certificate of Lessee, dated as of the Closing
      Date, stating that its representations and warranties set forth in this
      Agreement are true and correct as of the Closing Date (or, to the extent
      that any such representation and warranty expressly relates to an earlier
      date, true and correct as of such earlier date);

            (xviii) an Officer's Certificate of Wells Fargo, dated as of the
      Closing Date, stating that its representations and warranties, in its
      individual capacity and as Owner Trustee, set forth in this Agreement are
      true and correct as of the Closing Date (or, to the extent that any such
      representation and warranty expressly relates to an earlier date, true and
      correct as of such earlier date);

            (xix) an Officer's Certificate of Owner Participant, dated as of the
      Closing Date, stating that its representations and warranties set forth in
      this Agreement are true and correct as of the Closing Date (or, to the
      extent that any such representation and warranty expressly relates to an
      earlier date, true and correct as of such earlier date);

            (xx) an Officer's Certificate of WTC, dated as of the Closing Date,
      stating that its representations and warranties in its individual capacity
      or as Mortgagee, Pass Through Trustee or Subordination Agent, as the case
      may be, set forth in this Agreement are true and correct as of the Closing
      Date (or, to the extent that any such representation and warranty
      expressly relates to an earlier date, true and correct as of such earlier
      date);

            (xxi) an Officer's Certificate of Airframe Manufacturer, dated as of
      the Closing Date, stating that its representations and warranties set
      forth in this Agreement are true and correct as of the Closing Date (or,
      to the extent that any such representation and warranty expressly relates
      to an earlier date, true and correct as of such earlier date);

            [(xxii) an appointment of authorized representatives by Owner
      Trustee, and an acceptance thereof by such representatives;]20

            (xxiii) a copy of the application for registration of the Aircraft
      with the FAA in the name of Owner Trustee;

            (xxiv) the Financing Statements;

            (xxv) the following opinions of counsel, in each case dated the
      Closing Date:

                  (A) an opinion of Hughes Hubbard & Reed LLP, special counsel
            to Lessee, substantially in the form of Exhibit A;

                  (B) an opinion of Lessee's Legal Department, substantially in
            the form of Exhibit B;


- --------

20. Insert for New Lease.




                  (C) an opinion of (x) corporate counsel to Airframe
            Manufacturer, substantially in the form of Exhibit C-1, and (y)
            Katten Muchin Zavis Rosenman, special counsel to Airframe
            Manufacturer, substantially in the form of Exhibit C-2;

                  (D) an opinion of Ray, Quinney & Nebeker, special counsel to
            Owner Trustee, substantially in the form of Exhibit D;

                  (E) an opinion of Richards, Layton & Finger, special counsel
            to Mortgagee and Loan Participant, substantially in the form of
            Exhibit E;

                  (F) an opinion of special counsel to Owner Participant,
            substantially in the form of Exhibit F;

                  (G) an opinion of Lytle Soule & Curlee, special counsel in
            Oklahoma City, Oklahoma, substantially in the form of Exhibit G;

                  (H) an opinion of Walkers, special counsel to Seller,
            substantially in the form of Exhibit H;

            (xxvi) a copy of a current, valid Standard Certificate of
      Airworthiness for the Aircraft duly issued by the FAA;

            (xxvii) the Participants and their respective counsel shall have
      received copies of such documents and papers as such Participants may
      reasonably request, other than (A) in the case of Loan Participant, copies
      of the Purchase Agreement, provided that special counsel for Loan
      Participant may inspect the Purchase Agreement in connection with the
      transactions contemplated hereby or as a basis for such counsel's closing
      opinion, and (B) in the case of parties other than Owner Participant and
      its special counsel, the Tax Indemnity Agreement.

               5.1.3       OTHER COMMITMENTS

      [Each other]21 [The Loan]22 Participant shall have made available the
Dollar amount of its Commitment in accordance with Section 4.

               5.1.4       VIOLATION OF LAW

      No change shall have occurred after the date of this Agreement in any
applicable Law that makes it a violation of Law for (a) Lessee, any Participant,
Subordination Agent, Owner Trustee or Mortgagee to execute, deliver and perform
the Operative Agreements to which any of them is a party or (b) [any]23 [the
Loan]24 Participant to make the Dollar amount of its Commitment available or to


- --------

21. Insert for New Aircraft.

22. Delete for New Aircraft.

23. Insert for New Aircraft.

24. Delete for New Aircraft.



acquire an Equipment Note or to realize the benefits of the security afforded by
the Trust Indenture.

               5.1.5       PERFECTED SECURITY INTEREST

      On the Closing Date, after giving effect to the filing of the FAA Filed
Documents and the Financing Statements, Mortgagee shall have received a duly
perfected first priority security interest in all of Owner Trustee's right,
title and interest in the Aircraft and the Lease, subject only to Permitted
Liens.

               5.1.6       REPRESENTATIONS, WARRANTIES AND COVENANTS

      The representations and warranties of each other party to this Agreement
made, in each case, in this Agreement and in any other Operative Agreement to
which it is a party, shall be true and accurate in all material respects as of
the Closing Date (unless any such representation and warranty shall have been
made with reference to a specified date, in which case such representation and
warranty shall be true and accurate as of such specified date) and each other
party to this Agreement shall have performed and observed, in all material
respects, all of its covenants, obligations and agreements in this Agreement and
in any other Operative Agreement to which it is a party to be observed or
performed by it as of the Closing Date.

               5.1.7       NO EVENT OF DEFAULT

      On the Closing Date, no event shall have occurred and be continuing, or
would result from the mortgage or lease of the Aircraft, which constitutes a
Lease Default or Lease Event of Default, or an Indenture Default or Indenture
Event of Default.

               5.1.8       NO EVENT OF LOSS

      On the Closing Date, no Event of Loss with respect to the Airframe or any
Engine shall have occurred and no circumstance, condition, act or event that,
with the giving of notice or lapse of time or both, would give rise to or
constitute an Event of Loss with respect to the Airframe or any Engine shall
have occurred.

               5.1.9       TITLE

      Owner Trustee shall have good title to the Aircraft [(subject to filing
and recordation of the FAA Bill of Sale with the FAA)]25, free and clear of
Liens, except (a) the rights of Lessee under the Lease and Lease Supplement No.
1, (b) the Lien created by the Trust Indenture and the initial Trust Indenture
Supplement and (c) other Permitted Liens.

               5.1.10      CERTIFICATION

      The Aircraft shall have been duly certificated by the FAA as to type and
airworthiness.

- --------

25. Insert for New Aircraft.




               5.1.11      SECTION 1110

      Owner Trustee, as lessor under the Lease (and Mortgagee, as assignee of
Owner Trustee under the Trust Indenture), shall be entitled to the benefits of
Section 1110 (as currently in effect) with respect to the right to take
possession of the Airframe and Engines and to enforce any of its other rights or
remedies as provided in the Lease in the event of a case under Chapter 11 of the
Bankruptcy Code in which Lessee is a debtor.

               5.1.12      FILING

      On the Closing Date (a) the FAA Filed Documents shall have been duly filed
for recordation (or shall be in the process of being so duly filed for
recordation) with the FAA in accordance with the Act and (b) each Financing
Statement shall have been duly filed (or shall be in the process of being so
duly filed) in the appropriate jurisdiction.

               5.1.13      NO PROCEEDINGS

      No action or proceeding shall have been instituted, nor shall any action
be threatened in writing, before any Government Entity, nor shall any order,
judgment or decree have been issued or proposed to be issued by any Government
Entity, to set aside, restrain, enjoin or prevent the completion and
consummation of this Agreement or any other Operative Agreement or the
transactions contemplated hereby or thereby.

               5.1.14      GOVERNMENTAL ACTION

      All appropriate action required to have been taken prior to the Closing
Date by the FAA, or any governmental or political agency, subdivision or
instrumentality of the United States, in connection with the transactions
contemplated by this Agreement shall have been taken, and all orders, permits,
waivers, authorizations, exemptions and approvals of such entities required to
be in effect on the Closing Date in connection with the transactions
contemplated by this Agreement shall have been issued.

      5.2      CONDITIONS PRECEDENT TO OBLIGATIONS OF OWNER TRUSTEE

      The obligation of Owner Trustee to execute and deliver the Equipment Notes
on the Closing Date is subject to satisfaction or waiver by Owner Trustee, at or
prior to the Closing, of the conditions precedent set forth below in this
Section 5.2.

               5.2.1       NOTICE

      Owner Trustee shall have received the notice described in Section 4.1 or,
in the case of a Delayed Closing Date, 4.3, when and as required thereby, or
shall have waived such notice.

               5.2.2       DOCUMENTS

      Executed originals of the agreements, instruments, certificates or
documents described in Section 5.1.2 shall have been received by Owner Trustee,



except as specifically provided therein, unless the failure to receive any such
agreement, instrument, certificate or document is the result of any action or
inaction by Owner Trustee.

               5.2.3       OTHER CONDITIONS PRECEDENT

      Each of the conditions set forth in Sections 5.1.4, 5.1.6, 5.1.7 and
5.1.11 shall have been satisfied unless the failure of any such condition to be
satisfied is the result of any action or inaction by Owner Trustee.

      5.3      CONDITIONS PRECEDENT TO OBLIGATIONS OF MORTGAGEE

      The obligation of Mortgagee to authenticate the Equipment Notes on the
Closing Date is subject to the satisfaction or waiver by Mortgagee, at or prior
to the Closing, of the conditions precedent set forth below in this Section 5.3.

               5.3.1       NOTICE

      Mortgagee shall have received the notice described in Section 4.1 or, in
the case of a Delayed Closing Date, 4.3, when and as required thereby, or shall
have waived such notice.

               5.3.2       DOCUMENTS

      Executed originals of the agreements, instruments, certificates or
documents described in Section 5.1.2 shall have been received by Mortgagee,
except as specifically provided therein, unless the failure to receive any such
agreement, instrument, certificate or document is the result of any action or
inaction by Mortgagee.

               5.3.3       OTHER CONDITIONS PRECEDENT

      Each of the conditions set forth in Sections 5.1.4, 5.1.6, 5.1.7 and
5.1.11 shall have been satisfied unless the failure of any such condition to be
satisfied is the result of any action or inaction by Mortgagee.

      5.4      CONDITIONS PRECEDENT TO OBLIGATIONS OF LESSEE

      The obligation of Lessee to lease the Aircraft on the Closing Date and to
take the other actions required by this Agreement to be taken by it at the
Closing is subject to the satisfaction or waiver by Lessee, at or prior to the
Closing, of the conditions precedent set forth below in this Section 5.4.

               5.4.1       DOCUMENTS

      Executed originals of the agreements, instruments, certificates or
documents described in Section 5.1.2 shall have been received by Lessee, except
as specifically provided therein, and shall be satisfactory to Lessee, unless
the failure to receive any such agreement, instrument, certificate or document
is the result of any action or inaction by Lessee.



               5.4.2       SALES TAX

      Lessee shall be satisfied that no sales, use, value added, goods and
services or like tax, and no stamp tax duty, is payable with respect to the
transactions to occur at the Closing pursuant to this Agreement to the extent
that Lessee has liability therefor under Section 9.3.

               5.4.3       OTHER CONDITIONS PRECEDENT

      Each of the conditions set forth in Sections 5.1.3, 5.1.4, 5.1.6, 5.1.7
(as to Indenture Defaults or Indenture Events of Default not constituting Lease
Defaults or Lease Events of Default, respectively), 5.1.8, 5.1.9, 5.1.10,
5.1.11, 5.1.12, 5.1.13 and 5.1.14 shall have been satisfied or waived by Lessee,
unless the failure of any such condition to be satisfied is the result of any
action or inaction by Lessee.

      5.5      POST-REGISTRATION OPINION

      Promptly upon the registration of the Aircraft and the recordation of the
FAA Filed Documents pursuant to the Act, Airframe Manufacturer will cause Lytle
Soule & Curlee, special counsel in Oklahoma City, Oklahoma, to deliver to
Lessee, each Participant, Owner Trustee and Mortgagee a favorable opinion or
opinions addressed to each of them with respect to such registration and
recordation.

SECTION 6.     REPRESENTATIONS AND WARRANTIES

      6.1      LESSEE'S REPRESENTATIONS AND WARRANTIES

      Lessee represents and warrants to each Participant, Airframe Manufacturer,
Subordination Agent, Owner Trustee and Mortgagee that:

               6.1.1       ORGANIZATION; QUALIFICATION

      Lessee is a corporation duly incorporated, validly existing and in good
standing under the Laws of the State of Delaware and has the corporate power and
authority to conduct the business in which it is currently engaged and to own or
hold under lease its properties and to enter into and perform its obligations
under the Lessee Operative Agreements. Lessee is duly qualified to do business
as a foreign corporation in good standing in each jurisdiction in which the
nature and extent of the business conducted by it, or the ownership of its
properties, requires such qualification, except where the failure to be so
qualified would not give rise to a Material Adverse Change to Lessee.

               6.1.2       CORPORATE AUTHORIZATION

      Lessee has taken, or caused to be taken, all necessary corporate action
(including, without limitation, the obtaining of any consent or approval of
stockholders required by its Certificate of Incorporation or By-Laws) to
authorize the execution and delivery of each of the Lessee Operative Agreements,
and the performance of its obligations thereunder.




               6.1.3       NO VIOLATION

      The execution and delivery by Lessee of the Lessee Operative Agreements,
the performance by Lessee of its obligations thereunder and the consummation by
Lessee on the Closing Date of the transactions contemplated thereby, do not and
will not (a) violate any provision of the Certificate of Incorporation or
By-Laws of Lessee, (b) violate any Law applicable to or binding on Lessee or (c)
violate or constitute any default under (other than any violation or default
that would not result in a Material Adverse Change to Lessee), or result in the
creation of any Lien (other than as permitted under the Lease) upon the Aircraft
under, any indenture, mortgage, chattel mortgage, deed of trust, conditional
sales contract, lease, loan or other material agreement, instrument or document
to which Lessee is a party or by which Lessee or any of its properties is bound.

               6.1.4       APPROVALS

      The execution and delivery by Lessee of the Lessee Operative Agreements,
the performance by Lessee of its obligations thereunder and the consummation by
Lessee on the Closing Date of the transactions contemplated thereby do not and
will not require the consent or approval of, or the giving of notice to, or the
registration with, or the recording or filing of any documents with, or the
taking of any other action in respect of, (a) any trustee or other holder of any
Debt of Lessee and (b) any Government Entity, other than the filing of (x) the
FAA Filed Documents and the Financing Statements (and continuation statements
periodically) and (y) filings, recordings, notices or other ministerial actions
pursuant to any routine recording, contractual or regulatory requirements
applicable to it.

               6.1.5       VALID AND BINDING AGREEMENTS

      The Lessee Operative Agreements have been duly authorized, executed and
delivered by Lessee and, assuming the due authorization, execution and delivery
thereof by the other party or parties thereto, constitute the legal, valid and
binding obligations of Lessee and are enforceable against Lessee in accordance
with the respective terms thereof, except as such enforceability may be limited
by bankruptcy, insolvency, reorganization, receivership, moratorium and other
similar Laws affecting the rights of creditors generally and general principles
of equity, whether considered in a proceeding at law or in equity.

               6.1.6       LITIGATION

      Except as set forth in Lessee's most recent Annual Report on Form 10-K, as
amended, filed by Lessee with the SEC on or prior to the Closing Date, or in any
Quarterly Report on Form 10-Q or Current Report on Form 8-K (or any amendment
thereof) filed by Lessee with the SEC subsequent to such Form 10-K and on or
prior to the Closing Date, no action, claim or proceeding is now pending or, to
the Actual Knowledge of Lessee, threatened, against Lessee, before any court,
governmental body, arbitration board, tribunal or administrative agency, which
is reasonably likely to be determined adversely to Lessee and if determined
adversely to Lessee would result in a Material Adverse Change.




               6.1.7       FINANCIAL CONDITION

      The audited consolidated balance sheet of Lessee with respect to Lessee's
most recent fiscal year included in Lessee's most recent Annual Report on Form
10-K, as amended, filed by Lessee with the SEC, and the related consolidated
statements of operations and cash flows for the period then ended have been
prepared in accordance with GAAP and fairly present in all material respects the
financial condition of Lessee and its consolidated subsidiaries as of such date
and the results of its operations and cash flows for such period, and since the
date of such balance sheet, there has been no material adverse change in such
financial condition or operations of Lessee, except for matters disclosed in (a)
the financial statements referred to above or (b) any subsequent Quarterly
Report on Form 10-Q or Current Report on Form 8-K (or any amendment thereof)
filed by Lessee with the SEC on or prior to the date hereof.

               6.1.8       REGISTRATION AND RECORDATION

      Except for (a) the registration of the Aircraft with the FAA pursuant to
the Act in the name of Owner Trustee, (b) the filing for recordation (and
recordation) of the FAA Filed Documents, (c) the filing of the Financing
Statements (and continuation statements relating thereto at periodic intervals),
(d) the taking of possession and retention by Mortgagee of the original
counterparts of the Lease and Lease Supplement No. 1 and (e) the affixation of
the nameplates referred to in Section 7.1.3 of the Lease, no further action,
including any filing or recording of any document (including any financing
statement in respect thereof under Article 9 of the UCC) is necessary in order
to establish and perfect the right, title or interest of Owner Trustee, and the
Mortgagee's security interest, in the Aircraft and the Lease, as against Lessee
and any other Person, in each case, in any applicable jurisdiction in the United
States.

               6.1.9       LOCATION

      Lessee's location (as such term is used in Section 9-307 of the UCC) is
Delaware.

               6.1.10      NO DEFAULT

      No event which, if the Aircraft were subject to the Lease, constitutes a
Lease Event of Default has occurred and is continuing.

               6.1.11      NO EVENT OF LOSS

      No Event of Loss has occurred with respect to the Airframe or any Engine,
and, to the Actual Knowledge of Lessee, no circumstance, condition, act or event
has occurred that, with the giving of notice or lapse of time or both gives rise
to or constitutes an Event of Loss with respect to the Airframe or any Engine.

               6.1.12      COMPLIANCE WITH LAWS

      (a) Lessee is a Citizen of the United States and a U.S. Air Carrier.

      (b) Lessee holds all licenses, permits and franchises from the appropriate
Government Entities necessary to authorize Lessee to lawfully engage in air



transportation and to carry on scheduled commercial passenger service as
currently conducted, except where the failure to so hold any such license,
permit or franchise would not give rise to a Material Adverse Change to Lessee.

      (c) Lessee is not an "investment company" or a company controlled by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.

               6.1.13      SECURITIES LAWS

      Neither Lessee nor any person authorized to act on its behalf has directly
or indirectly offered any beneficial interest or Security relating to the
ownership of the Aircraft or the Lease or any interest in the Trust Estate and
Trust Agreement, or any of the Equipment Notes or any other interest in or
Security under the Trust Indenture, for sale to, or solicited any offer to
acquire any such interest or Security from, or has sold any such interest or
Security to, any person in violation of the Securities Act.

               6.1.14      BROKER'S FEES

      No Person acting on behalf of Lessee is or will be entitled to any
broker's fee, commission or finder's fee in connection with the Transactions.

               6.1.15      SECTION 1110

      Owner Trustee, as lessor under the Lease (and Mortgagee, as assignee under
the Trust Indenture), is entitled to the benefits of Section 1110 (as currently
in effect) with respect to the right to take possession of the Airframe and
Engines and to enforce any of its other rights or remedies as provided in the
Lease in the event of a case under Chapter 11 of the Bankruptcy Code in which
Lessee is a debtor.

      6.2      OWNER PARTICIPANT'S REPRESENTATIONS AND WARRANTIES

      Owner Participant represents and warrants to Lessee, Loan Participant,
Airframe Manufacturer, Subordination Agent, Owner Trustee and Mortgagee that:

               6.2.1       ORGANIZATION, ETC.

      Owner Participant is a corporation duly incorporated, validly existing and
in good standing under the Laws of the OP Jurisdiction and has the corporate
power and authority to conduct the business in which it is currently engaged and
to own or hold under lease its properties and to enter into, and perform its
obligations under the Owner Participant Agreements.

               6.2.2       CORPORATE AUTHORIZATION

      Owner Participant has taken, or caused to be taken, all necessary
corporate action (including, without limitation, the obtaining of any consent or
approval of stockholders required by its Certificate of Incorporation or
By-Laws) to authorize the execution and delivery of each of the Owner
Participant Agreements, and the performance of its obligations thereunder.




               6.2.3       NO VIOLATION

      The execution and delivery by Owner Participant of the Owner Participant
Agreements, the performance by Owner Participant of its obligations thereunder
and the consummation by Owner Participant on the Closing Date of the
transactions contemplated thereby, do not and will not (a) violate any provision
of the Certificate of Incorporation or By-Laws of Owner Participant, (b) violate
any Law applicable to or binding on Owner Participant or (c) violate or
constitute any default under (other than any violation or default that would not
result in a Material Adverse Change to Owner Participant), or result in the
creation of any Lien (other than as provided for or otherwise permitted in the
Operative Agreements) upon the Trust Estate under, any indenture, mortgage,
chattel mortgage, deed of trust, conditional sales contract, lease, loan or
other material agreement, instrument or document to which Owner Participant is a
party or by which Owner Participant or any of its properties is bound.

               6.2.4       APPROVALS

      The execution and delivery by Owner Participant of the Owner Participant
Agreements, the performance by Owner Participant of its obligations thereunder
and the consummation by Owner Participant on the Closing Date of the
transactions contemplated thereby do not and will not require the consent or
approval of, or the giving of notice to, or the registration with, or the
recording or filing of any documents with, or the taking of any other action in
respect of, (a) any trustee or other holder of any Debt of Owner Participant and
(b) any Government Entity, other than the filing of the FAA Filed Documents and
the Financing Statements.

               6.2.5       VALID AND BINDING AGREEMENTS

      The Owner Participant Agreements have been duly authorized, executed and
delivered by Owner Participant and, assuming the due authorization, execution
and delivery by the other party or parties thereto, constitute the legal, valid
and binding obligations of Owner Participant and are enforceable against Owner
Participant in accordance with the respective terms thereof, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
receivership, moratorium and other similar Laws affecting the rights of
creditors generally and general principles of equity, whether considered in a
proceeding at law or in equity.

               6.2.6       CITIZENSHIP

      On the Closing Date, Owner Participant is not a Citizen of the United
States, but holds an interest in the Trust Estate such that the Aircraft can be
registered in the United States (without giving consideration to Section 47.9 of
the FAA Regulations or any other provision that could restrict Lessee's use or
operation of the Aircraft).

               6.2.7       NO LIENS

      On the Closing Date, there are no Lessor Liens attributable to Owner
Participant in respect of all or any part of the Trust Estate.




               6.2.8       INVESTMENT BY OWNER PARTICIPANT

      Owner Participant's beneficial interest in the Trust Estate has been
acquired by it for its own account, for investment and not with a view to any
resale or distribution thereof, except that, subject to the restrictions on
transfer set forth in Section 10, the disposition by Owner Participant of its
beneficial interest in the Trust Estate shall at all times be within its
control.

               6.2.9       ERISA

      No part of the funds used by Owner Participant to acquire or hold its
interests in the Trust Estate directly or indirectly constitutes assets of a
Plan.

               6.2.10      LITIGATION

      There are no pending or, to the Actual Knowledge of Owner Participant,
threatened actions or proceedings against Owner Participant before any court,
governmental body, arbitration board, administrative agency or tribunal which,
if determined adversely to Owner Participant, would materially adversely affect
the ability of Owner Participant to perform its obligations under, or affect the
validity or enforceability of, the Owner Participant Agreements.

               6.2.11      SECURITIES LAWS

      Neither Owner Participant nor any person Owner Participant has authorized
to act on its behalf has directly or indirectly offered any beneficial interest
in or Security relating to the ownership of the Aircraft or any interest in the
Trust Estate, or any of the Equipment Notes or any other interest in or Security
under the Trust Indenture for sale to, or solicited any offer to acquire any of
the same from, any Person in violation of the registration provisions of the
Securities Act or applicable state securities Laws.

               6.2.12      BROKER'S FEES

      No Person acting on behalf of Owner Participant is or will be entitled to
any broker's fee, commission or finder's fee in connection with the
Transactions.

      6.3      WELLS FARGO'S REPRESENTATIONS AND WARRANTIES

      Wells Fargo represents and warrants (in the case of Section 6.3.13, solely
in its capacity as Owner Trustee) to Lessee, Owner Participant, Airframe
Manufacturer, Loan Participants, Subordination Agent and Mortgagee that:

               6.3.1       ORGANIZATION, ETC.

      Wells Fargo is a national banking association duly organized, validly
existing and in good standing under the Laws of the United States, holding a
valid certificate to do business as a national banking association with banking
authority to execute and deliver, and perform its obligations under, the Owner
Trustee Agreements.




               6.3.2       CORPORATE AUTHORIZATION

      Wells Fargo has taken, or caused to be taken, all necessary corporate
action (including, without limitation, the obtaining of any consent or approval
of stockholders required by Law or by its Articles of Association or By-Laws) to
authorize the execution and delivery by Wells Fargo, in its individual capacity
and as Owner Trustee, of each of the Owner Trustee Agreements, and the
performance of its obligations thereunder.

               6.3.3       NO VIOLATION

      The execution and delivery by Wells Fargo, in its individual capacity and
as Owner Trustee, of the Owner Trustee Agreements, the performance by Wells
Fargo, in its individual capacity and as Owner Trustee, of its obligations
thereunder and the consummation by Wells Fargo in its individual capacity and as
Owner Trustee on the Closing Date of the transactions contemplated thereby, do
not and will not (a) violate any provision of the Articles of Association or
By-Laws of Wells Fargo, (b) violate any Law of the State of Utah or federal
banking Law applicable to or binding on Owner Trustee or Wells Fargo or (c)
violate or constitute any default under (other than any violation or default
that would not result in a Material Adverse Change to Wells Fargo, in its
individual capacity or as Owner Trustee), or result in the creation of any Lien
(other than the lien of the Trust Indenture) upon any property of Wells Fargo,
in its individual capacity and as Owner Trustee, or any of its subsidiaries
under, any indenture, mortgage, chattel mortgage, deed of trust, conditional
sales contract, lease, loan or other material agreement, instrument or document
to which Wells Fargo, in its individual capacity or as Owner Trustee, is a party
or by which Wells Fargo, in its individual capacity or as Owner Trustee, or any
of its properties is or may be bound or affected.

               6.3.4       APPROVALS

      The execution and delivery by Wells Fargo, in its individual capacity and
as Owner Trustee, of the Owner Trustee Agreements, the performance by Wells
Fargo, in its individual capacity and as Owner Trustee, of its obligations
thereunder and the consummation by Wells Fargo, in its individual capacity and
as Owner Trustee, on the Closing Date of the transactions contemplated thereby
do not and will not require the consent, approval or authorization of, or the
giving of notice to, or the registration with, or the recording or filing of any
documents with, or the taking of any other action in respect of, (a) any trustee
or other holder of any Debt of Wells Fargo or (b) any Government Entity
governing banking and trust powers, other than the filing of the FAA Filed
Documents and the Financing Statements.

               6.3.5       VALID AND BINDING AGREEMENTS

      The Owner Trustee Agreements have been duly authorized, executed and
delivered by Wells Fargo, in its individual capacity or as Owner Trustee, as the
case may be, and constitute the legal, valid and binding obligations of Wells
Fargo, in its individual capacity and as Owner Trustee, and, assuming the due
authorization, execution and delivery thereof by the other party or parties
thereto, are enforceable against Wells Fargo, in its individual capacity and as
Owner Trustee, in accordance with the respective terms thereof, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
receivership, moratorium and other similar Laws affecting the rights of



creditors generally and general principles of equity, whether considered in a
proceeding at law or in equity.

               6.3.6       CITIZENSHIP

      On the Closing Date, Wells Fargo is a Citizen of the United States.

               6.3.7       LOCATION

      The Owner Trustee's location (as such term is used in Section 9-307 of the
UCC) is Utah.

               6.3.8       TITLE

      On the Delivery Date, Owner Trustee received whatever title to the
Aircraft as was conveyed to it by Seller.

               6.3.9       NO LIENS; FINANCING STATEMENTS

      On the Closing Date, there are no Lessor Liens attributable to Wells Fargo
or Owner Trustee in respect of all or any part of the Aircraft, Trust Estate or
the Trust Indenture Estate. Except for the Financing Statements and the one or
more UCC-1 financing statements covering the Aircraft and filed for
precautionary purposes by the Owner Trustee in connection with the delivery of
the Aircraft to Lessee under the Existing Lease on the Delivery Date, it has
not, either in its individual capacity or as Owner Trustee, executed any UCC
financing statements relating to the Aircraft or the Lease.

               6.3.10      LITIGATION

      There are no pending or, to the Actual Knowledge of Wells Fargo,
threatened actions or proceedings against Wells Fargo or Owner Trustee before
any court, governmental body, arbitration board, administrative agency or
tribunal which, if determined adversely to Wells Fargo or Owner Trustee, would
materially adversely affect the ability of Wells Fargo or Owner Trustee to
perform its obligations under, or affect the validity or enforceability of, the
Owner Trustee Agreements.

               6.3.11      SECURITIES LAWS

      Neither Wells Fargo, nor any person authorized to act on its behalf, has
directly or indirectly offered any beneficial interest or Security relating to
the ownership of the Aircraft or any interest in the Trust Estate or any of the
Equipment Notes or any other interest in or Security under the Trust Indenture
for sale to, or solicited any offer to acquire any such interest or Security
from, or has sold any such interest or Security to, any person other than the
Participants, except for the offering and sale of the Pass Through Certificates.

               6.3.12      EXPENSES AND TAXES

      There are no Expenses or Taxes that may be imposed on or asserted against
the Trust, the Trust Estate or any part thereof or any interest therein, the
Trust Indenture Estate, Lessee, Owner Participant, Pass Through Trustee,



Subordination Agent, Owner Trustee or Mortgagee (except as to Owner Trustee,
Taxes imposed on the fees payable to Owner Trustee) under the laws of Utah in
connection with the execution, delivery or performance of any Operative
Agreement by Owner Trustee or in connection with the issuance of the Equipment
Notes, which Expenses or Taxes would not have been imposed if Owner Trustee had
not (x) had its principal place of business in, (y) performed (in its individual
capacity or as Owner Trustee) any or all of its duties under the Operative
Agreements in or (z) engaged in any activities unrelated to the transactions
contemplated by the Operative Agreements in, the State of Utah.

               [6.3.13     PRIOR ACTIVITIES

      Owner Trustee has not engaged in any activities except holding title to
the Aircraft and leasing the Aircraft pursuant to the terms of the "Trust
Agreement" (as defined in the Existing Lease) and the Existing Lease,
respectively, and Owner Trustee has not incurred any debt or other financial
obligation, except as expressly provided in the "Trust Agreement" (as defined in
the Existing Lease) and the Existing Lease or such other debt that shall have
been satisfied or discharged in full contemporaneously with the Closing.]26

      6.4      WTC'S REPRESENTATIONS AND WARRANTIES

      WTC represents and warrants (with respect to Section 6.4.10, solely in its
capacity as Subordination Agent) to Lessee, Owner Participant, Airframe
Manufacturer, and Owner Trustee that:

               6.4.1       ORGANIZATION, ETC.

      WTC is a Delaware banking corporation duly organized, validly existing and
in good standing under the Laws of the State of Delaware, holding a valid
certificate to do business as a Delaware banking corporation with banking
authority to execute and deliver, and perform its obligations under, the
Mortgagee Agreements, the Pass Through Trustee Agreements and the Subordination
Agent Agreements.

               6.4.2       CORPORATE AUTHORIZATION

      WTC has taken, or caused to be taken, all necessary corporate action
(including, without limitation, the obtaining of any consent or approval of
stockholders required by Law or by its Certificate of Incorporation or By-Laws)
to authorize the execution and delivery by WTC, in its individual capacity or as
Mortgagee, Pass Through Trustee or Subordination Agent, as the case may be, of
the Mortgagee Agreements, the Pass Through Trustee Agreements and the
Subordination Agent Agreements and the performance of its obligations
thereunder.

               6.4.3       NO VIOLATION

      The execution and delivery by WTC, in its individual capacity or as
Mortgagee, Pass Through Trustee or Subordination Agent, as the case may be, of
the Mortgagee Agreements, the Pass Through Trustee Agreements and the


- ----------

26. Delete for New Aircraft.




Subordination Agent Agreements, the performance by WTC, in its individual
capacity or as Mortgagee, Pass Through Trustee or Subordination Agent, as the
case may be, of its obligations thereunder and the consummation on the Closing
Date of the transactions contemplated thereby, do not and will not (a) violate
any provision of the Certificate of Incorporation or By-Laws of WTC, (b) violate
any Law applicable to or binding on WTC, in its individual capacity or (except
in the case of any Law relating to any Plan) as Mortgagee, Pass Through Trustee
or Subordination Agent, or (c) violate or constitute any default under (other
than any violation or default that would not result in a Material Adverse Change
to WTC, in its individual capacity or as Mortgagee, Pass Through Trustee or
Subordination Agent), or result in the creation of any Lien (other than the lien
of the Trust Indenture) upon any property of WTC, in its individual capacity or
as Mortgagee, Pass Through Trustee or Subordination Agent, or any of WTC's
subsidiaries under, any indenture, mortgage, chattel mortgage, deed of trust,
conditional sales contract, lease, loan or other agreement, instrument or
document to which WTC, in its individual capacity or as Mortgagee, Pass Through
Trustee or Subordination Agent, is a party or by which WTC, in its individual
capacity or as Mortgagee, Pass Through Trustee or Subordination Agent, or any of
their respective properties is bound.

               6.4.4       APPROVALS

      The execution and delivery by WTC, in its individual capacity or as
Mortgagee, Pass Through Trustee or Subordination Agent, as the case may be, of
the Mortgagee Agreements, the Pass Through Trustee Agreements and the
Subordination Agent Agreements, the performance by WTC, in its individual
capacity or as Mortgagee, Pass Through Trustee or Subordination Agent, as the
case may be, of its obligations thereunder and the consummation on the Closing
Date by WTC, in its individual capacity or as Mortgagee, Pass Through Trustee or
Subordination Agent, as the case may be, of the transactions contemplated
thereby do not and will not require the consent, approval or authorization of,
or the giving of notice to, or the registration with, or the recording or filing
of any documents with, or the taking of any other action in respect of, (a) any
trustee or other holder of any Debt of WTC or (b) any Government Entity, other
than the filing of the FAA Filed Documents and the Financing Statements.

               6.4.5       VALID AND BINDING AGREEMENTS

      The Mortgagee Agreements, the Pass Through Trustee Agreements and the
Subordination Agent Agreements have been duly authorized, executed and delivered
by WTC and, assuming the due authorization, execution and delivery by the other
party or parties thereto, constitute the legal, valid and binding obligations of
WTC, in its individual capacity or as Mortgagee, Pass Through Trustee or
Subordination Agent, as the case may be, and are enforceable against WTC, in its
individual capacity or as Mortgagee, Pass Through Trustee or Subordination
Agent, as the case may be, in accordance with the respective terms thereof,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, receivership, moratorium or other similar Laws affecting the
rights of creditors generally and general principles of equity, whether
considered in a proceeding at law or in equity.

               6.4.6       CITIZENSHIP

      WTC is a Citizen of the United States.




               6.4.7       NO LIENS

      On the Closing Date, there are no Lessor Liens attributable to WTC in
respect of all or any part of the Trust Estate or the Trust Indenture Estate.

               6.4.8       LITIGATION

      There are no pending or, to the Actual Knowledge of WTC, threatened
actions or proceedings against WTC, in its individual capacity or as Mortgagee,
Pass Through Trustee or Subordination Agent, before any court, administrative
agency or tribunal which, if determined adversely to WTC, in its individual
capacity or as Mortgagee, Pass Through Trustee or Subordination Agent, as the
case may be, would materially adversely affect the ability of WTC, in its
individual capacity or as Mortgagee, Pass Through Trustee or Subordination
Agent, as the case may be, to perform its obligations under, or affect the
validity or enforceability of, any of the Mortgagee Agreements, the Pass Through
Trustee Agreements or the Subordination Agent Agreements.

               6.4.9       SECURITIES LAWS

      Neither WTC nor any person authorized to act on its behalf has directly or
indirectly offered any beneficial interest or Security relating to the ownership
of the Aircraft or any interest in the Trust Indenture Estate or any of the
Equipment Notes or any other interest in or Security under the Trust Indenture
for sale to, or solicited any offer to acquire any such interest or Security
from, or has sold any such interest or Security to, any Person other than the
Participants, except for the offering and sale of the Pass Through Certificates.

               6.4.10      INVESTMENT

      The Equipment Notes to be acquired by the Subordination Agent are being
acquired by it for the account of the Pass Through Trustee, for investment and
not with a view to any resale or distribution thereof, except that, subject to
the restrictions on transfer set forth in Section 10.1.3, the disposition by it
of its Equipment Notes shall at all times be within its control.

               6.4.11      TAXES

      There are no Taxes payable by the Pass Through Trustee or WTC, as the case
may be, imposed by the State of Delaware or any political subdivision or taxing
authority thereof in connection with the execution, delivery and performance by
the Pass Through Trustee or WTC, as the case may be, of this Agreement or any of
the Pass Through Trustee Agreements (other than franchise or other taxes based
on or measured by any fees or compensation received by any the Pass Through
Trustee or WTC, as the case may be, for services rendered in connection with the
transactions contemplated by the Pass Through Trust Agreement), and there are no
Taxes payable by the Pass Through Trustee or WTC, as the case may be, imposed by
the State of Delaware or any political subdivision thereof in connection with
the acquisition, possession or ownership by the Pass Through Trustee of any of
the Equipment Notes (other than franchise or other taxes based on or measured by
any fees or compensation received by the Pass Through Trustee or WTC, as the
case may be, for services rendered in connection with the transactions
contemplated by the Pass Through Trust Agreement), and, assuming that the trust



created by the Pass Through Trust Agreement will not be taxable as a
corporation, but, rather, will be characterized as a grantor trust under subpart
E, Part I of Subchapter J of the Code or as a partnership under Subchapter K of
the Code, such trust will not be subject to any Taxes imposed by the State of
Delaware or any political subdivision thereof.

               6.4.12      CONTROL

      WTC is not an Affiliate of the Owner Participant or the Owner Trustee.

               6.4.13      BROKER'S FEES

      No Person acting on behalf of WTC, in its individual capacity or as
Mortgagee, Pass Through Trustee or Subordination Agent, is or will be entitled
to any broker's fee, commission or finder's fee in connection with the
Transactions.

      6.5      AIRFRAME MANUFACTURER'S REPRESENTATIONS AND WARRANTIES

      Airframe Manufacturer represents and warrants to Lessee, each Participant,
Subordination Agent, Owner Trustee and Mortgagee that:

               6.5.1       ORGANIZATION, ETC.

      Airframe Manufacturer is a corporation duly incorporated, validly existing
and in good standing under the Laws of Brazil, and has the corporate power and
authority to conduct the business in which it is currently engaged and to own or
hold under lease its properties and to enter into, and perform its obligations
under the Airframe Manufacturer Agreements. [OP Guarantor has a tangible net
worth (exclusive of goodwill) greater than $25,000,000.]27

               6.5.2       CORPORATE AUTHORIZATION

      Airframe Manufacturer has taken, or caused to be taken, all necessary
corporate action (including, without limitation, the obtaining of any consent or
approval of stockholders required by its constitutional documents) to authorize
the execution and delivery of each of the Airframe Manufacturer Agreements, and
the performance of its obligations thereunder.

               6.5.3       NO VIOLATION

      The execution and delivery by Airframe Manufacturer of the Airframe
Manufacturer Agreements, the performance by Airframe Manufacturer of its
obligations thereunder and the consummation by Airframe Manufacturer on the
Closing Date of the transactions contemplated thereby, do not and will not (a)
violate any provision of the constitutional documents of Airframe Manufacturer,
(b) violate any Law applicable to or binding on Airframe Manufacturer or (c)
violate or constitute any default under (other than any violation or default
that would not result in a Material Adverse Change to Airframe Manufacturer), or
result in the creation of any Lien (other than as provided for or otherwise
permitted in the Operative Agreements) upon the Trust Estate under, any


- ----------

27. Insert if Op is an Affiliate of Airframe Manufacturer.




indenture, mortgage, chattel mortgage, deed of trust, conditional sales
contract, lease, loan or other material agreement, instrument or document to
which Airframe Manufacturer is a party or by which Airframe Manufacturer or any
of its properties is bound.

               6.5.4       APPROVALS

      The execution and delivery by Airframe Manufacturer of the Airframe
Manufacturer Agreements, the performance by Airframe Manufacturer of its
obligations thereunder and the consummation by Airframe Manufacturer on the
Closing Date of the transactions contemplated thereby do not and will not
require the consent or approval of, or the giving of notice to, or the
registration with, or the recording or filing of any documents with, or the
taking of any other action in respect of, (a) any trustee or other holder of any
Debt of Airframe Manufacturer and (b) any Government Entity, other than the
filing of the FAA Filed Documents and the Financing Statements.

               6.5.5       VALID AND BINDING AGREEMENTS

      The Airframe Manufacturer Agreements have been duly authorized, executed
and delivered by Airframe Manufacturer and, assuming the due authorization,
execution and delivery by the other party or parties thereto, constitute the
legal, valid and binding obligations of Airframe Manufacturer and are
enforceable against Airframe Manufacturer in accordance with the respective
terms thereof, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, receivership, moratorium and other similar Laws
affecting the rights of creditors generally and general principles of equity,
whether considered in a proceeding at law or in equity.

               6.5.6       TITLE

      On the Closing Date, Lessor shall have good and marketable title to the
Aircraft, free and clear of all claims, Liens and encumbrances of any nature,
except Permitted Liens.

               6.5.7       TAXES

      Lessor has filed or will cause to be filed all Federal and all material
state, local and foreign tax returns which are required to be filed by it and
have paid or will cause to be paid all Taxes which are due and payable in
connection with the Aircraft.

               6.5.8       LITIGATION

      There are no pending or, to the Actual Knowledge of Airframe Manufacturer,
threatened actions or proceedings against Airframe Manufacturer before any
court, governmental body, arbitration board, administrative agency or tribunal
which, if determined adversely to Airframe Manufacturer, would materially
adversely affect the ability of Airframe Manufacturer to perform its obligations
under, or affect the validity or enforceability of, the Airframe Manufacturer
Agreements.




               6.5.9       SECURITIES LAWS

      Neither Airframe Manufacturer nor any person Airframe Manufacturer has
authorized to act on its behalf has directly or indirectly offered any
beneficial interest in or Security relating to the ownership of the Aircraft or
any interest in the Trust Estate, or any of the Equipment Notes or any other
interest in or Security under the Trust Indenture for sale to, or solicited any
offer to acquire any of the same from, any Person in violation of the Securities
Act or applicable state securities Laws.

               6.5.10      BROKER'S FEES

      No Person acting on behalf of Airframe Manufacturer is or will be entitled
to any broker's fee, commission or finder's fee in connection with the
Transactions, except for the placement agent's fees and commissions payable with
respect to the offering of the Pass Through Certificates and the fees and
expenses of Equity Advisor, which are the sole responsibility of Airframe
Manufacturer.

SECTION 7.     COVENANTS, UNDERTAKINGS AND AGREEMENTS

      7.1      COVENANTS OF LESSEE

      Lessee covenants and agrees with Owner Participant, Loan Participant,
Owner Trustee and Mortgagee as follows:

               7.1.1       CORPORATE EXISTENCE; U.S. AIR CARRIER

      Lessee shall at all times maintain its corporate existence, except as
permitted by Section 13.2 of the Lease, and shall at all times remain a U.S.
Air Carrier.

               7.1.2       NOTICE OF CHANGE OF CHIEF EXECUTIVE OFFICE

      Lessee will give Owner Participant, Owner Trustee and Mortgagee timely
written notice (but in any event within 30 days prior to the expiration of the
period of time specified under applicable Law to prevent lapse of perfection) of
any change of its location (as such term is used in Section 9-307 of the UCC)
from its then present location and will promptly take any action required by
Section 7.1.3(c) as a result of such relocation.

               7.1.3       CERTAIN ASSURANCES

      (a) Lessee shall duly execute, acknowledge and deliver, or shall cause to
be executed, acknowledged and delivered, all such further agreements,
instruments, certificates or documents, and shall do and cause to be done such
further acts and things, in any case, as Owner Participant, Owner Trustee or
Mortgagee shall reasonably request for accomplishing the purposes of this
Agreement and the other Operative Agreements, PROVIDED THAT any instrument or
other document so executed by Lessee will not expand any obligations or limit
any rights of Lessee in respect of the transactions contemplated by any
Operative Agreement.




      (b) Lessee shall promptly take such action with respect to the recording,
filing, re-recording and re-filing of the Lease, the Trust Agreement and the
Trust Indenture and the respective supplements thereto, including, without
limitation, Lease Supplement No. 1 and the initial Trust Indenture Supplement,
as shall be necessary to establish, perfect and protect the interests and rights
of Owner Trustee in and to the Aircraft and under the Lease and the perfection
and priority of the Lien created by the Trust Indenture, and Lessee shall pay
all out-of-pocket costs and expenses thereof to the extent not paid by another
party as Transaction Expenses. Lessee shall furnish to Owner Participant or
Owner Trustee such information (other than with respect to the citizenship of
Owner Participant and Owner Trustee) in Lessee's possession or otherwise
reasonably available to Lessee as may be required to enable Owner Participant or
Owner Trustee to make application for registration of the Aircraft under the Act
(subject to Lessee's rights under Section 7.1.2 of the Lease).

      (c) Lessee will cause the FAA Filed Documents, the Financing Statements
and all continuation statements (and any amendments necessitated by any
combination, consolidation or merger pursuant to Section 13.2 of the Lease, or
any change of its location (as such term is used in Section 9-307 of the UCC))
in respect of the Financing Statements to be prepared and, subject only to the
execution and delivery thereof by Owner Trustee and Mortgagee, as applicable,
duly and timely filed and recorded, or filed for recordation, to the extent
permitted under the Act (with respect to the FAA Filed Documents) or the UCC or
similar law of any other applicable jurisdiction (with respect to such other
documents). Lessee hereby authorizes Owner Trustee and/or Mortgagee to prepare
and file any UCC financing statements (including any amendments thereto) and
continuation statements referred to in this Section 7.1.3(c).

      (d) If the Aircraft has been registered in a country other than the United
States pursuant to Section 7.1.2 of the Lease, Lessee will furnish to Owner
Trustee, Mortgagee and each Participant annually after such registration,
commencing with the calendar year after such registration is effected, an
opinion of special counsel reasonably satisfactory to Owner Trustee and
Mortgagee stating that, in the opinion of such counsel, either that (i) such
action has been taken with respect to the recording, filing, re-recording and
re-filing of the Operative Agreements and any supplements and amendments thereto
as is necessary to establish, perfect and protect Owner Trustee's and
Mortgagee's respective right, title and interest in and to the Aircraft and the
Operative Agreements, reciting the details of such actions, or (ii) no such
action is necessary to maintain the perfection of such right, title and
interest.

               7.1.4       SECURITIES LAWS

      Neither Lessee nor any person authorized to act on its behalf will
directly or indirectly offer any beneficial interest or Security relating to the
ownership of the Aircraft or the Lease or any interest in the Trust Estate and
Trust Agreement or any of the Equipment Notes or any other interest in or
Security under the Trust Indenture, for sale to, or solicit any offer to acquire
any such interest or Security from, or sell any such interest or Security to,
any person in violation of the Securities Act or applicable state or foreign
securities Laws.




      7.2      COVENANTS OF OWNER PARTICIPANT

      Owner Participant covenants and agrees with Lessee, and except with
respect to Section 7.2.4, Loan Participant, Owner Trustee and Mortgagee as
follows:

               7.2.1       LIENS

      Owner Participant (a) will not directly or indirectly create, incur,
assume or suffer to exist any Lessor Lien attributable to it on or with respect
to all or any part of the Trust Estate, the Trust Indenture Estate or the
Aircraft, (b) will, at its own cost and expense, take such action as may be
necessary to discharge any Lessor Lien attributable to Owner Participant on all
or any part of the Trust Estate, the Trust Indenture Estate or the Aircraft.
Owner Participant will hold harmless and indemnify Lessee, Owner Trustee, each
Note Holder, Mortgagee, each of their respective Affiliates, successors and
permitted assigns, the Trust Estate and the Trust Indenture Estate from and
against (i) any and all Expenses, (ii) any reduction in the amount payable out
of the Trust Estate or the Trust Indenture Estate and (iii) any interference
with the possession, operation or other use of all or any part of the Aircraft,
in each case imposed on, incurred by or asserted against any of the foregoing as
a consequence of any such Lessor Lien.

               7.2.2       REVOCATION OF TRUST AGREEMENT

      (a) Owner Participant will comply with the provisions of the Trust
Agreement applicable to it, and will not terminate or revoke the Trust Agreement
or the trusts created thereunder without the prior written consent of Lessee and
Mortgagee and will not amend, modify or supplement the Trust Agreement, or waive
any of the provisions thereof, if such amendment, modification, supplement or
waiver would have a material adverse effect on Lessee, without the consent of
Lessee, or on Mortgagee or any Note Holder, without the consent of Mortgagee.

      (b) Notwithstanding Section 7.2.2(a), Owner Participant may at any time
remove Owner Trustee pursuant to Section 9.1 of the Trust Agreement or terminate
the Trust Agreement pursuant to Section 11.2 of the Trust Agreement.

               7.2.3       CHANGE OF SITUS OF OWNER TRUST

      If, at any time, any Tax Indemnitee or the Trust Estate becomes subject to
any Taxes for which it is indemnified pursuant to Section 9.3 of this Agreement
and if, as a consequence thereof, Lessee should request that the situs of the
Trust be moved to another state in the United States from the state in which it
is then located, the situs of the Trust may be moved with the written consent of
Owner Participant (which consent shall not be unreasonably withheld) and Owner
Participant will take whatever action may be reasonably necessary to accomplish
such removal; PROVIDED, that, in any event, (a) Lessee shall provide such
additional tax indemnification as Owner Participant and the Note Holders or the
Pass Through Trustee may reasonably request to cover any additional
unindemnified Taxes or loss of Tax benefits described in the assumptions in the
Tax Indemnity Agreement resulting from such change in the situs of the Trust (it
being agreed that if a Lease Event of Default shall have occurred and is then
continuing, it shall not be unreasonable for Owner Participant to withhold its
consent to moving the situs of the Trust, notwithstanding the provision by
Lessee of such additional tax indemnification, unless a Section 1110 Event shall



have occurred and is then continuing), (b) the rights and obligations under the
Operative Agreements of Owner Participant, the Note Holders, Pass Through
Trustee and Mortgagee shall not be adversely affected as a result of the taking
of such action, (c) the Lien of the Trust Indenture on the Trust Indenture
Estate shall not be adversely affected by such action, and Lessee and Owner
Trustee shall execute and deliver such documents as may be necessary or as may
reasonably be requested by Mortgagee to protect and maintain the perfection and
priority of such Lien, (d) Owner Participant, Pass Through Trustee and Mortgagee
shall have received an opinion or opinions of counsel (which counsel is
reasonably satisfactory to Owner Participant, Pass Through Trustee and
Mortgagee) in scope, form and substance reasonably satisfactory to Owner
Participant, Pass Through Trustee and Mortgagee to the effect that (i) the
Trust, as thus removed, shall remain a validly established trust, (ii) any
amendments to the Trust Agreement necessitated by such removal shall have been
duly authorized, executed and delivered by the parties thereto and shall
constitute the valid and binding obligations of such parties, enforceable in
accordance with their terms, (iii) covering such other matters as Owner
Participant, Pass Through Trustee or Mortgagee may reasonably request, (e) if
such removal involves the replacement of Owner Trustee, then Owner Participant,
Pass Through Trustee and Mortgagee shall have received an opinion of counsel to
such successor Owner Trustee in form and substance reasonably satisfactory to
Owner Participant, Pass Through Trustee and Mortgagee covering the matters
described in the opinion delivered pursuant to Section 5.1.2(xxv)(D) and (f)
Lessee shall indemnify and hold harmless Owner Participant, Note Holders, Pass
Through Trustee and Wells Fargo, in its individual capacity and as Owner
Trustee, on a net after-tax basis against any and all reasonable out-of-pocket
costs and expenses including attorneys' fees and disbursements, fees and
expenses of any new owner trustee, registration, recording or filing fees and
taxes incurred by Owner Participant, Note Holders, Pass Through Trustee or Owner
Trustee in connection with such change of situs. Owner Participant agrees with
Lessee that it will not consent to or direct a change in the situs of the Trust
Estate without the prior written consent of Lessee, except that if a Lease Event
of Default shall have occurred and is then continuing, except during a Section
1110 Period, such consent shall not be required.

               7.2.4       COMPLIANCE WITH LEASE PROVISIONS

      Owner Participant will, solely for the benefit of Lessee, comply with the
express provisions applicable to it contained in the Lease.

               7.2.5       SECURITIES ACT

      Owner Participant will not directly or indirectly offer any beneficial
interest or Security relating to the ownership of the Aircraft or any interest
in the Trust Estate or any of the Equipment Notes or any other interest in or
Security under the Trust Indenture for sale to, or solicit any offer to acquire
any such interest or Security from, or sell any such interest or Security to,
any Person in violation of the registration provisions of the Securities Act or
applicable state or foreign Securities Laws, provided that the foregoing shall
not be deemed to impose on Owner Participant any responsibility with respect to
any such offer, sale or solicitation by any other party hereto.




               7.2.6       REGARDING THE OWNER TRUSTEE

      Owner Participant will instruct Owner Trustee to perform its obligations
under each Owner Trustee Agreement.

      7.3      COVENANTS OF WELLS FARGO AND OWNER TRUSTEE

      Wells Fargo, in its individual capacity and/or as Owner Trustee, as
provided below, covenants and agrees with Lessee, Owner Participant, each Note
Holder and Mortgagee as follows:

               7.3.1       LIENS

      Wells Fargo (a) will not directly or indirectly create, incur, assume or
suffer to exist any Lessor Lien attributable to it or Owner Trustee with respect
to all or any part of the Trust Estate, the Trust Indenture Estate or the
Aircraft, (b) will, at its own cost and expense, take such action as may be
necessary to discharge any Lessor Lien attributable to Wells Fargo or Owner
Trustee on all or any part of the Trust Estate, the Trust Indenture Estate or
the Aircraft. Wells Fargo will in its individual capacity hold harmless and
indemnify Lessee, Owner Participant, each Note Holder, Mortgagee, each of their
respective Affiliates, successors and permitted assigns, the Trust Estate and
the Trust Indenture Estate from and against (i) any and all Expenses, (ii) any
reduction in the amount payable out of the Trust Estate or the Trust Indenture
Estate and (iii) any interference with the possession, operation or other use of
all or any part of the Aircraft, in each case imposed on, incurred by or
asserted against any of the foregoing as a consequence of any such Lessor Lien.

               7.3.2       OTHER BUSINESS

      Owner Trustee will not enter into any business or other activity except as
contemplated by the Operative Agreements.

               7.3.3       NOTICE OF CHANGE OF LOCATION

      Wells Fargo, in its individual capacity and as Owner Trustee, will give
Lessee, each Participant and Mortgagee 30 days' prior written notice of any
change of its location (as such term is used in Section 9-307 of the UCC) from
its then present location and will promptly take any action required by Section
7.3.8 as a result of such relocation.

               7.3.4       SECURITIES ACT

      Wells Fargo, in its individual capacity and as Owner Trustee, will not
directly or indirectly offer any beneficial interest or Security relating to the
ownership of the Aircraft or any interest in the Trust Estate or any of the
Equipment Notes or any other interest in or Security under the Trust Indenture
for sale to, or solicit any offer to acquire any such interest or Security from,
or sell any such interest or Security to, any Person in violation of the
registration provisions of the Securities Act or applicable state or foreign
securities Laws, provided that the foregoing shall not be deemed to impose on



Wells Fargo in its individual capacity or as Owner Trustee, any responsibility
with respect to any such offer, sale or solicitation by any other party hereto.

               7.3.5       PERFORMANCE OF AGREEMENTS

      Owner Trustee shall perform its obligations under the Owner Trustee
Agreements in accordance with the terms thereof.

               7.3.6       RELEASE OF LIEN OF TRUST INDENTURE

      Owner Trustee, in each instance referred to in the Lease in which a
transfer of any property is required to be made by Owner Trustee to Lessee or
any other Person (other than Mortgagee or Owner Participant), shall, at Lessee's
request and expense, use its reasonable efforts to procure from Mortgagee the
prompt release of the Lien of the Trust Indenture with respect to such property.

               7.3.7       NOTICES; DOCUMENTS

      In the event any claim with respect to any liabilities is filed against
the Owner Trustee in its capacity as such and Owner Trustee shall have Actual
Knowledge thereof, the Owner Trustee shall promptly notify Lessee and Mortgagee
in writing thereof. Owner Trustee further agrees to provide to Lessee promptly
any documents (including the certificate of aircraft registration) that it
receives from the FAA with respect to the Aircraft.

               7.3.8       FILINGS

      After the Closing Date, Owner Trustee shall duly execute and deliver to
Lessee all filings and recordings (including, without limitation, all filings
and UCC financing statements under the Act and the UCC and any amendments to UCC
financing statements necessitated by any change of its location (as such term is
used in Section 9-307 of the UCC)), prepared and delivered to it by Lessee
required to perfect Owner Trustee's title to the Aircraft and the liens of and
security interests granted by the Trust Indenture (or to maintain such
perfection) and to make such title, liens and security interests valid and
enforceable. Owner Trustee hereby authorizes the Mortgagee to prepare and file
any UCC financing statements (including any amendments thereto) and continuation
statements referred to in this Section 7.3.8.

               7.3.9       TRUST AGREEMENT

      Each of Wells Fargo and Owner Trustee hereby (i) agrees with Lessee, Loan
Participant and Mortgagee not to amend, supplement, terminate or otherwise
modify any provision of the Trust Agreement in such a manner as to adversely
affect the rights of any such party without the prior written consent of such
party and (ii) agrees with Lessee, Loan Participant and Mortgagee not to revoke
the trust created by the Trust Agreement so long as the Trust Indenture remains
undischarged or if such revocation would have an adverse effect on the Lessee.
Nothing contained in this Agreement shall impair any right under the Trust
Agreement of Wells Fargo to resign as Owner Trustee in accordance with the
provisions of the Trust Agreement.




      7.4      COVENANTS OF WTC

      WTC in its individual capacity or as Mortgagee, Pass Through Trustee or
Subordination Agent, as the case may be, covenants and agrees with Lessee, Owner
Participant and Owner Trustee as follows:

               7.4.1       LIENS

      WTC (a) will not directly or indirectly create, incur, assume or suffer to
exist any Lessor Lien attributable to it on or with respect to all or any part
of the Trust Estate, the Trust Indenture Estate or the Aircraft, (b) will, at
its own cost and expense, promptly take such action as may be necessary to
discharge any Lessor Lien attributable to WTC on all or any part of the Trust
Estate, the Trust Indenture Estate or the Aircraft and (c) will in its
individual capacity hold harmless and indemnify Lessee, Owner Participant, each
Note Holder, Owner Trustee, each of their respective Affiliates, successors and
permitted assigns, the Trust Estate and the Trust Indenture Estate from and
against (i) any and all Expenses, (ii) any reduction in the amount payable out
of the Trust Estate or the Trust Indenture Estate and (iii) any interference
with the possession, operation or other use of all or any part of the Aircraft,
in each case imposed on, incurred by or asserted against any of the foregoing as
a consequence of any such Lessor Lien.

               7.4.2       SECURITIES ACT

      WTC in its individual capacity or as Mortgagee, Pass Through Trustee or
Subordination Agent, will not offer any beneficial interest or Security relating
to the ownership of the Aircraft or any interest in the Trust Indenture Estate,
or any of the Equipment Notes or any other interest in or Security under the
Trust Indenture for sale to, or solicit any offer to acquire any such interest
or Security from, or sell any such interest or Security to, any Person in
violation of the Securities Act or applicable state or foreign securities Laws,
provided that the foregoing shall not be deemed to impose on WTC any
responsibility with respect to any such offer, sale or solicitation by any other
party hereto.

               7.4.3       PERFORMANCE OF AGREEMENTS

      WTC, in its individual capacity and as Mortgagee, Pass Through Trustee or
Subordination Agent, as the case may be, shall perform its obligations under the
Mortgagee Agreements, the Pass Through Trustee Agreements and the Subordination
Agent Agreements in accordance with the terms thereof.

               7.4.4       WITHHOLDING TAXES

      WTC shall indemnify (on an after-tax basis) and hold harmless Lessee,
Lessor and Owner Participant against any United States withholding taxes (and
related interest, penalties and additions to tax) as a result of the failure by
WTC to withhold on payments to any Note Holder if such Note Holder failed to
provide to Mortgagee necessary certificates or forms to substantiate the right
to exemption from such withholding tax.




      7.5      COVENANTS OF NOTE HOLDERS

      Each Note Holder (including Subordination Agent) as to itself only
covenants and agrees with Lessee, Owner Participant, Owner Trustee and Mortgagee
as follows:

               7.5.1       WITHHOLDING TAXES

      Such Note Holder (if it is a Non-U.S. Person) agrees to indemnify (on an
after-tax basis) and hold harmless Lessee, Lessor, Owner Participant and
Mortgagee against any United States withholding taxes (and related interest,
penalties and additions to tax) as a result of the inaccuracy or invalidity of
any certificate or form provided by such Note Holder to Mortgagee in connection
with such withholding taxes. Any amount payable hereunder shall be paid within
30 days after receipt by a Note Holder of a written demand therefor.

               7.5.2       TRANSFER; COMPLIANCE

      (a) Such Note Holder will (i) not transfer any Equipment Note or interest
therein in violation of the Securities Act or applicable state or foreign
securities Law; PROVIDED, that the foregoing provisions of this section shall
not be deemed to impose on such Note Holder any responsibility with respect to
any such offer, sale or solicitation by any other party hereto, and (ii) perform
and comply with the obligations specified to be imposed on it (as a Note Holder)
under each of the Trust Indenture and the form of Equipment Note set forth in
the Trust Indenture.

      (b) Except as otherwise required by the terms of Section 2.13 of the Trust
Indenture, each Note Holder will not sell, assign, convey, exchange or otherwise
transfer any Equipment Note or any interest in, or represented by, any Equipment
Note (it being understood that this provision is not applicable to the Pass
Through Certificates) unless the proposed transferee thereof first provides
Lessee and Owner Participant with both of the following:

            (i) a written representation and covenant that either (a) no portion
      of the funds it uses to purchase, acquire and hold such Equipment Note or
      interest directly or indirectly constitutes, or may be deemed under the
      Code or ERISA or any rulings, regulations or court decisions thereunder to
      constitute, the assets of any Plan or (b) the transfer, and subsequent
      holding, of such Equipment Note or interest shall not involve or give rise
      to a transaction that constitutes a prohibited transaction within the
      meaning of Section 406 of ERISA or Section 4975(c)(1) of the Code
      involving Lessee, Owner Participant, Pass Through Trustee, the
      Subordination Agent or the proposed transferee (other than a transaction
      that is exempted from the prohibitions of such sections by applicable
      provisions of ERISA or the Code or administrative exemptions or
      regulations issued thereunder); and

            (ii) a written covenant that it will not transfer any Equipment Note
      or any interest in, or represented by, any Equipment Note unless the
      subsequent transferee also makes the representation described in clause
      (i) above and agrees to comply with this clause (ii) and the other
      covenants of the Note Holders contained in the Operative Agreements.




      7.6      AGREEMENTS

               7.6.1       OWNER TRUSTEE IS OWNER FOR ALL PURPOSES

      Lessee, the Owner Participant and Owner Trustee agree that for all
purposes, after the Closing, Owner Trustee will be the owner of the Aircraft
(except that Owner Participant will be the owner for income tax purposes) and
Lessee will be the lessee thereof. No transfer, by operation of Law or
otherwise, of the beneficial interest of Owner Participant in and to the Trust
Estate shall operate to transfer legal title to any part of the Trust Estate to
any transferee thereof.

               7.6.2       COMMENCEMENT OF BANKRUPTCY PROCEEDINGS

      Lessee, each Participant, each Note Holder, Wells Fargo, Owner Trustee,
WTC and Mortgagee agree for the benefit of each of the others that it will not
commence or join in any proceeding under the Bankruptcy Code to commence a case
under Section 303 of the Bankruptcy Code against the Trust Estate. Nothing
contained herein shall be deemed to preclude any Participant, any Note Holder,
Wells Fargo, Owner Trustee, WTC or Mortgagee from filing any claim against the
Trust Estate in any case commenced against the Trust Estate or preclude the
exercise of remedies pursuant to, or limit the rights of Mortgagee under, the
Trust Indenture.

               7.6.3       CERTAIN BANKRUPTCY MATTERS

      If (a) all or any part of the Trust Estate becomes the property of, or
Owner Trustee or Owner Participant becomes, a debtor subject to the
reorganization provisions of the Bankruptcy Code, (b) pursuant to such
reorganization provisions, including Section 1111(b) of the Bankruptcy Code,
Wells Fargo or Owner Participant is required, by reason of Wells Fargo or Owner
Participant being held to have recourse liability to any Note Holder or
Mortgagee directly or indirectly (other than the recourse liability of Wells
Fargo or Owner Participant under this Agreement, the Trust Indenture or by
separate agreement), to make payment on account of any amount payable as
principal, Make-Whole Amount, if any, interest or other amounts on the Equipment
Notes, and (c) any Note Holder or Mortgagee actually receives any Excess Amount,
as defined below, which reflects any payment by Wells Fargo or Owner Participant
on account of (b) above, then such Note Holder or Mortgagee, as the case may be,
shall promptly refund to Wells Fargo or Owner Participant (whichever shall have
made such payment) such Excess Amount.

      For purposes of this Section 7.6.3, "Excess Amount" means the amount by
which such payment exceeds the amount that would have been received by a Note
Holder or Mortgagee if Wells Fargo or Owner Participant had not become subject
to the recourse liability referred to in clause (b) above, and such Note Holder
or Mortgagee receives written notice that such amount is an Excess Amount prior
to its distribution thereof. Nothing contained in this Section 7.6.3 shall
prevent a Note Holder or Mortgagee from enforcing any personal recourse
obligation (and retaining the proceeds thereof) of Wells Fargo or Owner
Participant under this Agreement (other than as referred to in clause (b) above)
or the Trust Indenture (and any exhibits or annexes thereto) or from retaining
any amount paid by Owner Participant under Sections 2.13 or 4.03 of the Trust
Indenture.




               7.6.4       QUIET ENJOYMENT; SALE BY OWNER TRUSTEE BINDING

      (a) Owner Participant, Pass Through Trustee, Subordination Agent, each
Note Holder, Owner Trustee and Mortgagee agrees as to itself with Lessee that,
so long as no Lease Event of Default shall have occurred and be continuing, such
Person shall not (and shall not permit any Affiliate or other Person claiming
by, through or under it to) interfere with Lessee's rights in accordance with
the Lease to the quiet enjoyment, possession and use of the Aircraft during the
Term.

      (b) Any assignment, sale, transfer or other conveyance of the Aircraft by
Owner Trustee made pursuant to the terms of this Agreement or the Lease 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 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, as regards Owner Participant.

               7.6.5       RELEASE OF LIEN OF TRUST INDENTURE

      Each of Lessee, Lessor and Mortgagee agrees that in each instance referred
to in the Lease in which a transfer of any property is required to be made by
Lessor to Lessee or any other Person (other than Mortgagee), Mortgagee shall,
upon request of Lessor and compliance with the applicable provisions of the
Lease and Trust Indenture, promptly execute (at Lessee's cost and expense) such
instruments as Lessor or Lessee may reasonably request to evidence the release
of the Lien of the Trust Indenture with respect to such property.

               7.6.6       NON-RECOURSE

      Loan Participant and Mortgagee agree that (a) obligations of Owner Trustee
under the Trust Indenture or any other Operative Agreement and with respect to
the Equipment Notes shall be non-recourse to Owner Participant and to Wells
Fargo and (b) they will look solely to the income and proceeds from the Trust
Estate and the Trust Indenture Estate to the extent available for distribution
to Note Holder or Mortgagee as provided in the Trust Indenture and that neither
Owner Participant nor Wells Fargo will be personally liable to Loan Participant
or Mortgagee for any amounts payable by Owner Trustee under the Trust Indenture
or any other Operative Agreement; PROVIDED, HOWEVER, that the foregoing is not
intended nor shall it be construed to limit any recourse liability of Owner
Participant or Wells Fargo to the extent that such liability is expressly set
forth in this Agreement or in any of the Operative Agreements or arises by
reason of the breach of any representation or warranty or covenant given by such
Person (in the case of Wells Fargo, in its individual capacity).

               7.6.7       OTHER DOCUMENTS; AMENDMENT

      (a) Each of the Owner Participant and the Owner Trustee hereby agrees with
Lessee, the Loan Participant, and the Mortgagee not to amend, supplement or
otherwise modify any provision of the Trust Agreement in a manner that could
materially adversely affect such party without the prior written consent of such
party (including without limitation in the case of such agreement with Lessee,
Section 4.2.5 of the Trust Agreement). Notwithstanding the foregoing, so long as



the Lease has not been terminated or expired, each Participant, the Mortgagee
and the Owner Trustee hereby agree for the benefit of Lessee that without the
consent of Lessee they will not amend, supplement or otherwise modify (i)
Article III, Article IX or Sections 2.02 (third paragraph), 2.05 or 3.06 (second
sentence) of the Trust Indenture, (ii) any provision of any Operative Agreement
that will affect the stated principal amount of or premium or interest on the
Equipment Notes or (iii) any other provision of the Trust Indenture or Equipment
Notes in a manner that could materially adversely affect Lessee. Mortgagee and
Owner Trustee agree promptly to furnish to Lessee copies of any supplement,
amendment, waiver or modification of any of the Operative Agreements to which
Lessee is not a party. Loan Participant agrees that it will not take any action
in respect of the Trust Indenture Estate except through the Mortgagee pursuant
to the Trust Indenture or as otherwise permitted by the Trust Indenture.

      (b) Owner Trustee agrees to join with Lessee to the extent that action on
its part is necessary or appropriate (i) to cause the following to be duly
accomplished in accordance with applicable United States federal Law by the time
the Aircraft is delivered under this Agreement and the Lease: (A) the
application for registration of the Aircraft in the name of Owner Trustee and
(B) all related action necessary in order for Lessee to have temporary or
permanent authority to operate the Aircraft as contemplated by the Lease and
(ii) forthwith upon delivery of the Aircraft under this Agreement and the Lease,
to cause all necessary documents to be duly filed for recording in accordance
with applicable United States federal Law.

               7.6.8       CONSENTS

      Owner Participant, Pass Through Trustee, Subordination Agent, Owner
Trustee and Mortgagee each covenants and agrees, for the benefit of Lessee, that
it shall not unreasonably withhold its consent to any consent or approval
requested of it or of Owner Trustee or Mortgagee under the terms of any of the
Operative Agreements which by its terms is not to be unreasonably withheld.

               7.6.9       INSURANCE

      Each of Owner Participant, the Pass Through Trustee, the Subordination
Agent and the Owner Trustee agrees not to obtain or maintain insurance for its
own account as permitted by Section 11.2 of the Lease if such insurance would
limit or otherwise materially adversely affect the coverage of any insurance
required to be obtained or maintained by Lessee pursuant to Section 11 and Annex
D of the Lease.

               7.6.10      EXTENT OF INTEREST OF NOTE HOLDERS

      A Note Holder shall not, as such, have any further interest in, or other
right with respect to, the Trust Estate or the Trust Indenture Estate when and
if the principal and Make-Whole Amount, if any, of and interest on the Equipment
Note held by such Holder, and all other sums, then due and payable to such
Holder hereunder and under any other Operative Agreement, shall have been paid
in full.




               7.6.11      FOREIGN REGISTRATION

      Each Participant, Owner Trustee and Mortgagee hereby agree, for the
benefit of Lessee but subject to the provisions of Section 7.1.2 of the Lease:

      (a) that Lessee shall be entitled to register the Aircraft or cause the
Aircraft to be registered in a country other than the United States subject to
compliance with the following:

            (i) each of the following requirements is satisfied:

                  (A)   such registration shall be made only after the Tax
                        Attribute Period, unless Lessee prepays on a lump sum
                        basis calculated pursuant to Section 5(f) of the Tax
                        Indemnity Agreement any liability due under the Tax
                        Indemnity Agreement as a result of such registration
                        based upon the assumption that such registration
                        would continue for the remainder of the term of the
                        Permitted Sublease described in clause (C) below,
                        PROVIDED, that notwithstanding the foregoing, such
                        registration may be made during the taxable year in
                        which the seventh anniversary of the Delivery Date
                        occurs so long as the Aircraft is not "used
                        predominantly outside the United States" within the
                        meaning of Section 168(g) of the Code during such
                        taxable year;

                  (B)   no Lease Event of Default shall have occurred and be
                        continuing at the time of such registration;

                  (C)   such proposed change of registration is made in
                        connection with a Permitted Sublease to a Permitted Air
                        Carrier; and

                  (D)   such country is a Permitted Country with which the
                        United States then maintains normal diplomatic
                        relations.

            (ii) the Owner Trustee, Owner Participant and Mortgagee shall have
      received an opinion, in form and substance reasonably satisfactory to the
      Owner Participant (subject to customary exceptions), of counsel reasonably
      satisfactory to the Owner Participant and Mortgagee addressed to each such
      party to the effect that:

                  (A)   such country would recognize the Owner Trustee's title
                        to, ownership interest in and right to possession of,
                        the Aircraft;

                  (B)   the obligations of Lessee, and the rights and remedies
                        of Owner Trustee, under the Lease are valid, binding and
                        enforceable under the laws of such country (or the laws
                        of the country to which the laws of such country would
                        refer as the applicable governing law);

                  (C)   after giving effect to such change in registration,
                        the Lien of the Trust Indenture on the Owner
                        Trustee's right, title and interest in and to the
                        Aircraft and the Lease shall continue as a valid and



                        duly perfected first priority security interest and
                        all filing, recording or other action necessary to
                        protect the same shall have been accomplished (or, if
                        such opinion cannot be given at the time of such
                        proposed change in registration because such change
                        in registration is not yet effective, (1) the opinion
                        shall detail what filing, recording or other action
                        is necessary and (2) Owner Trustee and the Mortgagee
                        shall have received a certificate from Lessee that
                        all possible preparations to accomplish such filing,
                        recording and other action shall have been done, and
                        such filing, recording and other action shall be
                        accomplished and a supplemental opinion to that
                        effect shall be delivered to Owner Trustee and the
                        Mortgagee on or prior to the effective date of such
                        change in registration;

                  (D)   it is not necessary, solely as a consequence of such
                        change in registration and without giving effect to
                        any other activity of Owner Trustee, the Owner
                        Participant or the Mortgagee (or any Affiliate
                        thereof), as the case may be, for Owner Trustee, the
                        Owner Participant or the Mortgagee to qualify to do
                        business in such country as a result of such
                        reregistration;

                  (E)   there is no tort liability of the owner or lessor or
                        mortgagee of an aircraft not in possession thereof
                        under the laws of such country (it being agreed that,
                        in the event such latter opinion cannot be given in a
                        form satisfactory to the Owner Participant and
                        Mortgagee, such opinion shall be waived if insurance
                        reasonably satisfactory to the Owner Participant and
                        Mortgagee is provided to cover such risk); and

                  (F)   unless Lessee shall have agreed to provide insurance
                        reasonably satisfactory to Owner Participant and
                        Mortgagee covering the risk of requisition of use of
                        the Aircraft by the government of such country (so
                        long as the Aircraft is registered under the laws of
                        such country), the laws of such country require fair
                        compensation by the government of such country
                        payable in currency freely convertible into Dollars
                        and freely removable from such country (without
                        license or permit, unless Lessee prior to such
                        proposed reregistration has obtained such license or
                        permit) for the taking or requisition by such
                        government of such use.

      (b) In addition, as a condition precedent to any change in registration
Lessee shall have given to Lessor and Mortgagee assurances reasonably
satisfactory to each of them:

            (i)    to the effect that the provisions of Section 11 of the Lease
                   have been complied with after giving effect to such change of
                   registration; and




            (ii)   of the payment by Lessee of all reasonable out-of-pocket
                   expenses at no after-tax cost to any Participant of
                   Lessor, each Participant and Mortgagee in connection with
                   such change of registry, including, without limitation
                   (1) the reasonable fees and disbursements of counsel to
                   Lessee, Lessor and Mortgagee, (2) any filing or recording
                   fees, Taxes or similar payments incurred in connection
                   with the change of registration of the Aircraft and the
                   creation and perfection of the security interest therein
                   in favor of Mortgagee for the benefit of Note Holders,
                   (3) all costs and expenses incurred in connection with any
                   filings necessary to continue in the United States the
                   perfection of the security interest in the Aircraft and
                   the Lease in favor of Mortgagee for the benefit of Note
                   Holders and (4) costs in connection with the calculation
                   of the lump sum payment described in clause (i)(A) of this
                   Section 7.6.11.

               7.6.12      OTHER COMMERCIAL RELATIONS UNAFFECTED

      Notwithstanding anything to the contrary set forth in any Operative
Agreement:

      (a) Except as set forth in the Purchase Agreement Assignment, nothing
contained in the Operative Agreements shall constitute or be deemed to be a
waiver by Lessee of any rights, remedies or claims it may have against Airframe
Manufacturer or Engine Manufacturer or any subcontractor or supplier of either;
and the Operative Agreements do not and shall not be construed or deemed to
create any rights, waivers, immunities or indemnities in favor of Airframe
Manufacturer, Engine Manufacturer or any subcontractor or supplier of either
with respect to any such rights, remedies or claims of Lessee; and

      (b) The Airframe Manufacturer, by its execution and delivery of the
Consent and Agreement, shall not be deemed to have waived any rights, remedies
or claims which Airframe Manufacturer (or any subcontractor or supplier of
Airframe Manufacturer) may have against Lessee; and the Operative Agreements do
not and shall not be construed or deemed to create any rights, waivers,
immunities or indemnities in favor of Lessee with respect to any such rights,
remedies or claims of Airframe Manufacturer (or any subcontractor or supplier of
Airframe Manufacturer).

               7.6.13      INTEREST IN CERTAIN ENGINES

      Each Participant, Owner Trustee, and Mortgagee agree, for the benefit of
each of the lessor, conditional seller, mortgagee or secured party of any
airframe or engine leased to, or purchased by, Lessee or any Permitted Sublessee
subject to a lease, conditional sale, trust indenture or other security
agreement that it will not acquire or claim, as against such lessor, conditional
seller, mortgagee or secured party, any right, title or interest in any engine
as the result of such engine being installed on the Airframe at any time while
such engine is subject to such lease, conditional sale, trust indenture or other
security agreement and owned by such lessor or conditional seller or subject to
a trust indenture or security interest in favor of such mortgagee or secured
party.




SECTION 8.     CONFIDENTIALITY

      Lessee, Owner Participant, Note Holders, Owner Trustee, Mortgagee and
Airframe Manufacturer shall keep Annexes B, C and D and Schedules 1, 2, 3 and 4
to the Lease, the Purchase Agreement Assignment and the Tax Indemnity Agreement
confidential and shall not disclose, or cause to be disclosed, the same to any
other Person, except (A) to prospective and permitted transferees of Lessee's,
Owner Participant's, a Note Holder's, a Liquidity Provider's, Owner Trustee's,
Mortgagee's or other Indenture Indemnitee's interest or their respective counsel
or special counsel, independent insurance brokers, auditors, or other agents who
agree to hold such information confidential, (B) to Lessee's, Owner
Participant's, a Note Holder's, a Liquidity Provider's, Pass Through Trustee's,
Owner Trustee's, Mortgagee's or other Indenture Indemnitee's counsel or special
counsel, independent insurance brokers, auditors, or other agents, Affiliates or
investors who agree to hold such information confidential, (C) as may be
required by any statute, court or administrative order or decree, legal process
or governmental ruling or regulation, including those of any applicable
insurance regulatory bodies (including, without limitation, the National
Association of Insurance Commissioners), federal or state banking examiners,
Internal Revenue Service and state and local income tax auditors or any stock
exchange, (D) with respect to Lessee and Owner Participant, by mutual agreement
of such parties, (E) with respect to a Note Holder or Pass Through Trustee, to a
nationally recognized rating agency for the purpose of obtaining a rating on the
Equipment Notes or the Pass Through Certificates or to support an NAIC rating
for the Equipment Notes or the Pass Through Certificates or (F) such other
Persons as are reasonably deemed necessary by the disclosing party in order to
protect the interests of such party or for the purposes of enforcing such
documents by such party; PROVIDED, that any and all disclosures permitted by
clauses (C), (D), (E) or (F) above shall be made only to the extent necessary to
meet the specific requirements or needs of the Persons making such disclosures.

SECTION 9.     INDEMNIFICATION AND EXPENSES

      9.1      GENERAL INDEMNITY

               9.1.1       INDEMNITY

      If the Closing occurs, Lessee shall indemnify, protect, defend and hold
harmless each Indemnitee from, against and in respect of, and shall pay on a net
after-tax basis, any and all Expenses of any kind or nature whatsoever that may
be imposed on, incurred by or asserted against any Indemnitee, relating to,
resulting from, or arising out of or in connection with, any one or more of the
following:

      (a) The Operative Agreements, the Pass Through Agreements, or the
enforcement of any of the terms of any of the Operative Agreements or the Pass
Through Agreements;

      (b) The Aircraft, the Airframe, any Engine or any Part, including, without
limitation, with respect thereto, (i) the manufacture, design, purchase,
acceptance, nonacceptance or rejection, ownership, registration, reregistration,
deregistration, delivery, nondelivery, lease, sublease, assignment, possession,
use or non-use, operation, maintenance, testing, repair, overhaul, condition,
alteration, modification, addition, improvement, storage, airworthiness,



replacement, repair, sale, substitution, return, abandonment, redelivery or
other disposition of the Aircraft, any Engine or any Part, (ii) any claim or
penalty arising out of violations of applicable Laws by Lessee (or any Permitted
Sublessee), (iii) tort liability, whether or not arising out of the negligence
of any Indemnitee (whether active, passive or imputed), (iv) death or property
damage of passengers, shippers or others, (v) environmental control, noise or
pollution and (vi) any Liens in respect of the Aircraft, any Engine or any Part;

      (c) The offer, sale, or delivery of any Equipment Notes, Pass Through
Certificates or any interest therein or represented thereby; and

      (d) Any breach of or failure to perform or observe, or any other
noncompliance with, any covenant or agreement or other obligation to be
performed by Lessee under any Lessee Operative Agreement or any Pass Through
Agreement or the falsity of any representation or warranty of Lessee in any
Lessee Operative Agreement or any Pass Through Agreement other than in the Tax
Indemnity Agreement.

               9.1.2       EXCEPTIONS

      Notwithstanding anything contained in Section 9.1.1, Lessee shall not be
required to indemnify, protect, defend and hold harmless any Indemnitee pursuant
to Section 9.1.1 in respect of any Expense of such Indemnitee:

      (a) For any Taxes or a loss of Tax benefit, whether or not Lessee is
required to indemnify therefor pursuant to Section 9.3 or the Tax Indemnity
Agreement; PROVIDED, HOWEVER, this Section 9.1.1(a) shall not apply to any taxes
taken into account in making any payment on a net after tax basis;

      (b) Except to the extent attributable to acts or events occurring prior
thereto, acts or events (other than acts or events related to the performance or
failure to perform by Lessee of its obligations pursuant to the terms of the
Lessee Operative Agreements) that occur after the earlier of: (i) with respect
to the Airframe, any Engine or any Part, the return of possession (it being
understood that the date of the placement of the Aircraft in storage as provided
in Section 5 of the Lease constitutes the date of return of the Aircraft under
the Lease) of such Airframe, Engine or Part pursuant to the terms of and in
compliance with the Lease (other than pursuant to Section 15 thereof, in which
case Lessee's liability under this Section 9.1 shall survive for so long as
Lessor or Mortgagee shall be entitled to exercise remedies under such Section
15) or (ii) the termination of the Term in accordance with the Lease;

      (c) To the extent attributable to any Transfer (voluntary or involuntary)
by or on behalf of such Indemnitee of any Equipment Note or interest therein,
except (i) for out-of-pocket costs and expenses incurred as a result of any such
Transfer pursuant to the exercise of remedies under any Operative Agreement
resulting from a Lease Event of Default and (ii) as otherwise required by the
terms of Section 2.13 of the Trust Indenture;

      (d) To the extent attributable to any Transfer (voluntary or involuntary)
by or on behalf of Owner Participant of any interest in the Aircraft, or the
Trust Estate except for costs and expenses incurred as a result of such
Transfer, if such Transfer arises directly from a Lease Event of Default that
shall have occurred and be continuing;




      (e) To the extent attributable to the gross negligence or willful
misconduct of such Indemnitee or any related Indemnitee (as defined below)
(other than gross negligence or willful misconduct imputed to such person by
reason of its interest in the Aircraft or any Operative Agreement);

      (f) In the case of Wells Fargo, to the extent attributable to matters
enumerated in the proviso to Section 14;

      (g) To the extent attributable to the incorrectness or breach of any
representation or warranty of such Indemnitee or any related Indemnitee
contained in or made pursuant to any Operative Agreement or any Pass Through
Agreement;

      (h) To the extent attributable to the failure by such Indemnitee or any
related Indemnitee to perform or observe any agreement, covenant or condition on
its part to be performed or observed in any Operative Agreement or any Pass
Through Agreement;

      (i) To the extent attributable to the offer or sale by such Indemnitee or
any related Indemnitee of any interest in the Aircraft, the Equipment Notes, the
Pass Through Certificates, the Trust Estate or the Trust Agreement or any
similar interest, in violation of the Securities Act or other applicable
federal, state or foreign securities Laws (other than any offer or sale thereof
caused by the acts or omissions of Lessee);

      (j) (i) With respect to any Indemnitee (other than Mortgagee), to the
extent attributable to the failure of the Mortgagee to distribute funds received
and distributable by it in accordance with the Trust Indenture, (ii) with
respect to any Indemnitee (other than the Owner Trustee), to the extent
attributable to the failure of the Owner Trustee to distribute funds received
and distributable by it in accordance with the Trust Agreement, (iii) with
respect to any Indemnitee (other than the Subordination Agent), to the extent
attributable to the failure of the Subordination Agent to distribute funds
received and distributable by it in accordance with the Intercreditor Agreement,
(iv) with respect to any Indemnitee (other than the Pass Through Trustee), to
the extent attributable to the failure of the Pass Through Trustee to distribute
funds received and distributable by it in accordance with the Pass Through Trust
Agreement, (v) with respect to any Indemnitee (other than the Escrow Agent), to
the extent attributable to the failure of the Escrow Agent to pay funds received
and payable by it in accordance with any Escrow Agreement, (vi) with respect to
any Indemnitee (other than the Paying Agent), to the extent attributable to the
failure of the Paying Agent to distribute funds received and distributable by it
in accordance with any Escrow Agreement, (vii) to the extent attributable to the
failure of the Depositary to pay funds payable by it in accordance with any
Deposit Agreement, (viii) with respect to Mortgagee, to the extent attributable
to the negligence or willful misconduct of Mortgagee in the distribution of
funds received and distributable by it in accordance with the Trust Indenture,
(ix) with respect to Owner Trustee, to the extent attributable to the negligence
or willful misconduct of Owner Trustee in the distribution of funds received and
distributable by it in accordance with the Trust Agreement, (x) with respect to
the Subordination Agent, to the extent attributable to the negligence or willful
misconduct of the Subordination Agent in the distribution of funds received and
distributable by it in accordance with the Intercreditor Agreement, (xi) with
respect to the Pass Through Trustee, to the extent attributable to the
negligence or willful misconduct of the Pass Through Trustee in the distribution



of funds received and distributable by it in accordance with the Pass Through
Trust Agreement, (xii) with respect to the Escrow Agent, to the extent
attributable to the negligence or willful misconduct of the Escrow Agent in the
payment of funds received and payable by it in accordance with any Escrow
Agreement, and (xiii) with respect to the Paying Agent, to the extent
attributable to the negligence or willful misconduct of the Paying Agent in the
distribution of funds received and distributable by it in accordance with any
Escrow Agreement.

      (k) Other than during the continuation of a Lease Event of Default, to the
extent attributable to the authorization or giving or withholding of any future
amendments, supplements, waivers or consents with respect to any Operative
Agreement or Pass Through Agreement other than such as have been requested by
Lessee or as are required by or made pursuant to the terms of the Operative
Agreements or Pass Through Agreements (unless such requirement results from the
actions of an Indemnitee not required by or made pursuant to the Operative
Agreements or the Pass Through Agreements);

      (l) To the extent attributable to any amount which any Indemnitee
expressly agrees to pay or such Indemnitee expressly agrees shall not be paid by
or be reimbursed by Lessee;

      (m) To the extent that it is an ordinary and usual operating or overhead
expense;

      (n) With respect to the Owner Participant or the Owner Trustee, or any
related Indemnitee, to the extent attributable to the deregistration of the
Aircraft under the Act as a result of Owner Participant's or Owner Trustee's (or
any related Indemnitee of either) not being a Citizen of the United States as a
result of any act (other than reregistration of the Aircraft pursuant to Section
7.1.2 of the Lease) of Owner Participant or Owner Trustee, or any related
Indemnitee of either of the foregoing (not taken at the request of the Lessee);

      (o) For any Lessor Lien attributable to such Indemnitee or any related
Indemnitee;

      (p) If another provision of an Operative Agreement or a Pass Through
Agreement specifies the extent of Lessee's responsibility or obligation with
respect to such Expense, to the extent arising from other than failure of Lessee
to comply with such specified responsibility or obligation;

      (q) To the extent it is a Transaction Expense;

      (r) To the extent constituting principal, Make-Whole Amount or interest on
the Equipment Notes attributable solely to an Event of Default not constituting
a Lease Event of Default; or

      (s) To the extent incurred by or asserted against an Indemnitee as a
result of any "prohibited transaction", within the meaning of Section 406 of
ERISA or Section 4975(c)(1) of the Code; or

      (t) To the extent not included in the definition of Supplemental Rent as a
result of the provisions of clause (e) of such definition.




      For purposes of this Section 9.1, a Person shall be considered a "related"
Indemnitee with respect to an Indemnitee if such Person is an Affiliate or
employer of such Indemnitee, a director, officer, employee, agent, or servant of
such Indemnitee or any such Affiliate or a successor or permitted assignee of
any of the foregoing.

               9.1.3       SEPARATE AGREEMENT

      This Agreement constitutes a separate agreement with respect to each
Indemnitee and is enforceable directly by each such Indemnitee.

               9.1.4       NOTICE

      If a claim for any Expense that an Indemnitee shall be indemnified against
under this Section 9.1 is made, such Indemnitee shall give prompt written notice
thereof to Lessee. Notwithstanding the foregoing, the failure of any Indemnitee
to notify Lessee as provided in this Section 9.1.4, or in Section 9.1.5, shall
not release Lessee from any of its obligations to indemnify such Indemnitee
hereunder, except to the extent that such failure results in an additional
Expense to Lessee (in which event Lessee shall not be responsible for such
additional Expense) or materially impairs Lessee's ability to contest such
claim.

               9.1.5       NOTICE OF PROCEEDINGS; DEFENSE OF CLAIMS;
                           LIMITATIONS

      (a) In case any action, suit or proceeding shall be brought against any
Indemnitee for which Lessee is responsible under this Section 9.1, such
Indemnitee shall notify Lessee of the commencement thereof and Lessee may, at
its expense, participate in and to the extent that it shall wish (subject to the
provisions of the following paragraph), assume and control the defense thereof
and, subject to Section 9.1.5(c), settle or compromise the same.

      (b) Lessee or its insurer(s) shall have the right, at its or their
expense, to investigate or, if Lessee or its insurer(s) shall agree in writing
not to dispute liability to the Indemnitee giving notice of such action, suit or
proceeding under this Section 9.1.5 for indemnification hereunder or under any
insurance policies pursuant to which coverage is sought, control the defense of,
any action, suit or proceeding, relating to any Expense for which
indemnification is sought pursuant to this Section 9.1, and each Indemnitee
shall cooperate with Lessee or its insurer(s) with respect thereto; PROVIDED,
that Lessee shall not be entitled to control the defense of any such action,
suit, or proceeding or compromise any such Expense (i) during the continuance of
any Lease Event of Default arising under Section 14.1 of the Lease, (ii) if such
proceedings would entail a material risk of the sale, forfeiture or loss of the
Aircraft or (iii) if such proceedings would entail a risk of criminal liability
or greater than de minimis risk of material civil penalties being imposed on
such Indemnitee. In connection with any such action, suit or proceeding being
controlled by Lessee, such Indemnitee shall have the right to participate
therein, at its sole cost and expense, with counsel reasonably satisfactory to
Lessee; PROVIDED, that such Indemnitee's participation does not, in the
reasonable opinion of the independent counsel appointed by the Lessee or its
insurers to conduct such proceedings, interfere with the defense of such case.

      (c) In no event shall any Indemnitee enter into a settlement or other
compromise with respect to any Expense without the prior written consent of
Lessee, which consent shall not be unreasonably withheld or delayed, unless such



Indemnitee waives its right to be indemnified with respect to such Expense under
this Section 9.1.

      (d) In the case of any Expense indemnified by the Lessee hereunder which
is covered by a policy of insurance maintained by Lessee pursuant to Section 11
of the Lease, at Lessee's expense, each Indemnitee agrees to cooperate with the
insurers in the exercise of their rights to investigate, defend or compromise
such Expense as may be required to retain the benefits of such insurance with
respect to such Expense.

      (e) If an Indemnitee is not a party to this Agreement, Lessee may require
such Indemnitee to agree in writing to the terms of this Section 9 and Section
15.8 prior to making any payment to such Indemnitee under this Section 9.

      (f) Nothing herein shall be deemed to be an assumption by Lessee of
obligations of Owner Trustee with respect to, or a guarantee by Lessee of, any
amounts payable by Owner Trustee upon Equipment Notes or a guarantee of any
residual value of the Aircraft.

      (g) Nothing contained in this Section 9.1.5 shall be deemed to require an
Indemnitee to contest any Expense or to assume responsibility for or control of
any judicial proceeding with respect thereto.

               9.1.6       INFORMATION

      Lessee will provide the relevant Indemnitee with such information not
within the control of such Indemnitee, as is in Lessee's control or is
reasonably available to Lessee, which such Indemnitee may reasonably request and
will otherwise cooperate with such Indemnitee so as to enable such Indemnitee to
fulfill its obligations under Section 9.1.5. The Indemnitee shall supply Lessee
with such information not within the control of Lessee, as is in such
Indemnitee's control or is reasonably available to such Indemnitee, which Lessee
may reasonably request to control or participate in any proceeding to the extent
permitted by Section 9.1.5.

               9.1.7       EFFECT OF OTHER INDEMNITIES; SUBROGATION; FURTHER
                           ASSURANCES

      Upon the payment in full by Lessee of any indemnity provided for under
this Agreement, Lessee, without any further action and to the full extent
permitted by Law, will be subrogated to all rights and remedies of the person
indemnified (other than with respect to any of such Indemnitee's insurance
policies or in connection with any indemnity claim such Indemnitee may have
under Section 5.03 or 7.01 of the Trust Indenture or Section 5.3 or 7 of the
Trust Agreement) in respect of the matter as to which such indemnity was paid.
Each Indemnitee will give such further assurances or agreements and cooperate
with Lessee to permit Lessee to pursue such claims, if any, to the extent
reasonably requested by Lessee and at Lessee's expense.

               9.1.8       REFUNDS

      If an Indemnitee receives any refund, in whole or in part, with respect to
any Expense paid by Lessee hereunder, it will promptly pay the amount refunded
(but not an amount in excess of the amount Lessee or any of its insurers has
paid in respect of such Expense) over to Lessee unless a Lease Event of Default



shall have occurred and be continuing, in which case such amounts shall be paid
over to Owner Trustee (or, so long as the Trust Indenture shall not have been
discharged, to Mortgagee) to hold as security for Lessee's obligations under the
Lessee Operative Agreements or, if requested by Lessee, applied to satisfy such
obligations.

      9.2      EXPENSES

               9.2.1       TRANSACTION EXPENSES

      Owner Participant shall pay all Transaction Expenses (which shall exclude
the ongoing fees, disbursements and expenses of Mortgagee and the Owner
Trustee), up to an aggregate amount equal to the Expense Limit. Airframe
Manufacturer shall pay all Transaction Expenses in excess of the Expense Limit
and the ongoing fees, disbursements and expenses of Mortgagee and the Owner
Trustee, provided that if Airframe Manufacturer shall fail to make any payment
when due of the ongoing fees, disbursements and expenses of Mortgagee or Owner
Trustee, Lessee shall make such payment if so requested by Mortgagee or Owner
Trustee, as applicable, in which case Airframe Manufacturer shall be obligated
to immediately reimburse Lessee for any payment made by Lessee pursuant to this
sentence. Lessee shall have no liability or obligation with respect to
Transaction Expenses, except as provided in the preceding sentence.

               9.2.2       PAYMENT OF OTHER EXPENSES

      Lessee will be responsible for the fees and charges of its counsel
incurred in connection with the preparation, execution and delivery of the
Operative Agreements. All out-of-pocket costs and expenses of Lessee (including,
without limitation, reasonable attorney's fees and charges) incurred in
performance of Sections 7.1.3(a), (b) and (c) (other than with respect to the
first parenthetical of Section 7.1.3(c)) to the extent constituting Transaction
Expenses, shall be paid pursuant to Section 9.2.1 and, otherwise, shall be paid
by Airframe Manufacturer. Airframe Manufacturer shall pay all costs and expenses
incurred by it in connection with the Operative Agreements.

      9.3      GENERAL TAX INDEMNITY

               9.3.1       GENERAL

      Except as provided in Section 9.3.2, Lessee agrees that each payment of
Rent paid by Lessee pursuant to the Lease, and any other payment or indemnity
paid by Lessee to a Tax Indemnitee under any Operative Agreement, shall be free
of all withholdings or deductions with respect to Taxes of any nature (other
than U.S. federal withholding taxes on, based on or measured by gross or net
income), and in the event that Lessee shall be required by applicable law to
make any such withholding or deduction for any such payment (x) Lessee shall
make all such withholdings or deductions, (y) the amount payable by Lessee shall
be increased so that after making all required withholdings or deductions such
Tax Indemnitee receives (at no after-Tax cost to the Tax Indemnitee) the same
amount that it would have received had no such withholdings or deductions been
made, and (z) Lessee shall pay the full amount withheld or deducted to the
relevant Taxing Authority in accordance with applicable law. Lessee further
agrees that, in the event it is required to withhold from any payment of Basic
Rent, Termination Value, Stipulated Loss Value (and amounts determined by



reference thereto), or amounts payable upon exercise of Lessee's purchase option
pursuant to Section 17.3 of the Lease, any Tax imposed upon Owner Participant or
Owner Trustee (including any withholding Tax based on income or receipts of
Owner Participant or Owner Trustee) and such Tax is excluded from
indemnification pursuant to Section 9.3.2, Lessee shall pay such additional
amount, if any, required so that the total amount paid by Lessee (after making
all required withholdings) is equal to (assuming timely payment of the Equipment
Notes prior to the relevant Payment Date) the aggregate principal amount of
scheduled installments due on the Equipment Notes outstanding on the relevant
Payment Date, together with accrued and unpaid interest, due on the Equipment
Notes; Owner Participant or Owner Trustee, as the case may be, shall reimburse
Lessee for any such additional amounts within two Business Days after demand
therefor. Except as provided in Section 9.3.2 and whether or not any of the
transactions contemplated hereby are consummated, Lessee shall pay, indemnify,
protect, defend and hold each Tax Indemnitee harmless from all Taxes imposed by
any Taxing Authority that may from time to time be imposed on or asserted
against any Tax Indemnitee or the Aircraft, the Airframe, any Engine or any Part
or any interest in any of the foregoing (whether or not indemnified against by
any other Person), upon or with respect to the Operative Agreements or the
transactions or payments contemplated thereby, including but not limited to any
Tax imposed upon or with respect to (x) the Aircraft, the Airframe, any Engine,
any Part, any Operative Agreement (including without limitation any Equipment
Notes) or any data or any other thing delivered or to be delivered under an
Operative Agreement, (y) the purchase, manufacture, acceptance, rejection, sale,
transfer of title, return, ownership, mortgaging, delivery, transport, charter,
rental, lease, re-lease, sublease, assignment, possession, repossession,
presence, use, condition, storage, preparation, maintenance, modification,
alteration, improvement, operation, registration, transfer or change of
registration, reregistration, repair, replacement, overhaul, location, control,
the imposition of any Lien (other than a Lessor Lien), financing, refinancing
requested by the Lessee, abandonment or other disposition of the Aircraft, the
Airframe, any Engine, any Part, any data or any other thing delivered or to be
delivered under an Operative Agreement, or (z) rent, interest, fees or any other
income, proceeds, receipts or earnings, whether actual or deemed, arising upon,
in connection with, or in respect of, any of the Operative Agreements (including
the property or income or other proceeds with respect to property held as part
of the Trust Estate) or the transactions contemplated thereby.

               9.3.2       CERTAIN EXCEPTIONS

      The provisions of Section 9.3.1 shall not apply to, and Lessee shall have
no liability hereunder for, Taxes:

      (a) imposed on a Tax Indemnitee by the federal government of the United
States or any Taxing Authority of any jurisdiction within the United States in
which such Tax Indemnitee is incorporated or maintains its principal place of
business or is otherwise subject to Taxes of such type as a result of
transactions or activities by such Tax Indemnitee or its Affiliates that are
independent of the transactions and activities contemplated by the Operative
Agreements (i) on, based on, or measured by, gross or net income or gross or net
receipts, including capital gains taxes, excess profits taxes, minimum taxes
from tax preferences, alternative minimum taxes, branch profits taxes,
accumulated earnings taxes, personal holding company taxes, succession taxes and
estate taxes, and any withholding taxes on, based on or measured by gross or net
income or receipts or (ii) on, or with respect to, or measured by, capital or
net worth or in the nature of a franchise tax or a tax for the privilege of



doing business (other than, in the case of clause (i) or (ii), sales, use,
license or property Taxes, Taxes in the nature of sales or use taxes, value
added taxes imposed in lieu of any of the foregoing, airport excise taxes or any
excise taxes imposed in the nature of or in lieu of any of the foregoing and
other than, in the case of clause (ii), any doing business taxes imposed by a
taxing authority in any jurisdiction (other than the jurisdiction within which
such Tax Indemnitee is incorporated or maintains its principal place of
business) if such doing business taxes attributable to the transactions
contemplated by the Operative Agreements were subject to indemnity pursuant to
the provisions of this clause 9.3.2(a) (without regard to this parenthetical)
solely as a result of the usage or location of the Aircraft in such jurisdiction
by a Lessee Person when such Tax Indemnitee was not incorporated or doing
business or otherwise subject to Taxes of such type in such jurisdiction, if in
a subsequent taxable period such Indemnitee becomes subject to Taxes of such
type as a result of activities or transactions other than those contemplated by
the Operative Agreements, to the extent that such taxes (and in an amount no
more than the amount of such Taxes that) would have continued to be imposed
solely as a result of the usage or location of the Aircraft by a Lessee Person
in such jurisdiction in the absence of any additional nexus between such Tax
Indemnitee and such jurisdiction);

      (b) imposed as a result of the replacement of the existing financing
agreements with the Operative Agreements and the Express Sublease or the
issuance of the Equipment Notes;

      (c) on, or with respect to, or measured by, any trustee fees, commissions
or compensation received by Owner Trustee, Pass Through Trustee, Subordination
Agent or Mortgagee;

      (d) on the Trust or the Trust Estate that result from treatment of the
Trust or the Trust Estate as an entity, such as a corporation, separate and
apart from the Owner Participant;

      (e) that are being contested as provided in Section 9.3.4 hereof, for so
long as such contest is continuing;

      (f) imposed on any Tax Indemnitee to the extent that such Taxes result
from the gross negligence or willful misconduct of such Tax Indemnitee, a
related Tax Indemnitee or any Affiliate thereof;

      (g) imposed on or with respect to a Tax Indemnitee (including the
transferee in those cases in which the Tax on transfer is imposed on, or is
collected from, the transferee) as a result of a transfer or other disposition
(including a deemed transfer or disposition) by such Tax Indemnitee or a related
Tax Indemnitee (or, in the case of the Owner Participant, by Owner Trustee
(unless requested by the Lessee), or, in the case of Taxes imposed on a
transferee, by the transferor) of any interest in the Aircraft, the Airframe,
any Engine or any Part, the Rent (other than the assignment of Rent to the
Mortgagee pursuant to the Trust Indenture), the Trust, the Trust Estate, the
Trust Indenture Estate, the Lease or any interest arising under the Operative
Agreements or any Equipment Note or a transfer or disposition (including a
deemed transfer or disposition) of any interest in a Tax Indemnitee (other than
(A) a substitution or replacement of the Aircraft, the Airframe, any Engine or
any Part by a Lessee Person that is treated for Tax purposes as a transfer or
disposition, (B) a transfer pursuant to an exercise of remedies upon a Lease



Event of Default that shall have occurred and have been continuing, or (C) a
transfer to Lessee pursuant to Section 17.3 of the Lease);

      (h) except with respect to gross-ups, imposed subsequent to (and not in
respect of) a transfer or other disposition described in paragraph (g) above and
not described in the last parenthetical of such paragraph (g) and in excess of
those that would have been imposed had there not been a transfer or other
disposition by or to such Tax Indemnitee or a related Tax Indemnitee described
in paragraph (g) above;

      (i) imposed on the Owner Participant and indemnified by Lessee pursuant to
the Tax Indemnity Agreement;

      (j) imposed with respect to any period after the expiration or earlier
termination of the Term and, if required pursuant to the terms of the Lease, the
return of possession of the Aircraft to Lessor or placement in storage at the
request of Lessor in accordance with the Lease (provided that this exclusion (j)
shall not apply to Taxes imposed after such period arising as a result of events
occurring prior to such expiration or earlier termination);

      (k) consisting of any interest, penalties or additions to tax imposed on a
Tax Indemnitee resulting from a failure of such Tax Indemnitee or a related Tax
Indemnitee to file any return properly and timely, unless such failure shall be
caused by the failure of Lessee to fulfill its obligations, if any, under
Section 9.3.6 with respect to such return, PROVIDED that if any such return is
required to be filed in a jurisdiction outside the United States, which return
would not have been required to be filed in the absence of the transactions
contemplated under the Operative Agreements or Lessee's transactions or
activities in such jurisdiction, this exclusion shall not apply if (A) Lessee
has not informed the Tax Indemnitee in writing of the need to file such return
at least 30 days prior to the due date thereof (or such shorter period as would
reasonably allow the Tax Indemnitee to file such return if, under the
circumstances, the Lessee could not have reasonably informed the Tax Indemnitee
of the need to file at least 30 days prior to the due date thereof), or (B) the
Tax Indemnitee had determined in good faith that such filing would subject it or
any Affiliate to adverse consequences in such jurisdiction for which it had not
been (and would not have been) indemnified;

      (l) resulting from, or that would not have been imposed but for, any
Lessor Liens arising as a result of claims against, or acts or omissions of, or
otherwise attributable to such Tax Indemnitee or a related Tax Indemnitee;

      (m) imposed on any Tax Indemnitee as a result of the breach by such Tax
Indemnitee or a related Tax Indemnitee of any covenant of such Tax Indemnitee or
any Affiliate thereof contained in any Operative Agreement or the inaccuracy of
any representation or warranty by such Tax Indemnitee or any Affiliate thereof
in any Operative Agreement;

      (n) in the nature of an intangible or similar Tax (i) upon or with respect
to the value or principal amount of the interest of Loan Participant or any Note
Holder in any Equipment Note or the loan evidenced thereby or (ii) upon or with
respect to the value of the interest of the Owner Participant in the Trust
Estate or the Trust, in each case only if such Taxes are in the nature of
franchise Taxes or result from the Tax Indemnitee doing business in the taxing



jurisdiction and are imposed because of the place of incorporation or the
activities unrelated to the transactions contemplated by the Operative
Agreements in the taxing jurisdiction of such Tax Indemnitee;

      (o) that are included in Lessor's Cost and paid to the appropriate Taxing
Authority;

      (p) imposed on a Tax Indemnitee by a Taxing Authority of a jurisdiction
outside the United States within which such Tax Indemnitee is incorporated or
maintains its principal place of business or to the extent that such Taxes would
not have been imposed but for a connection between the Tax Indemnitee or a
related Tax Indemnitee and such jurisdiction imposing such Tax unrelated to the
transactions contemplated by the Operative Agreements; or

      (q) Taxes relating to ERISA or Section 4975 of the Code.

      For purposes hereof, a Tax Indemnitee and any other Tax Indemnitees that
are successors, assigns, agents, servants or Affiliates of such Tax Indemnitee
shall be related Tax Indemnitees.

               9.3.3       PAYMENT

      (a) Lessee's indemnity obligation to a Tax Indemnitee under this Section
9.3 shall equal the amount which, after taking into account any Tax imposed upon
the receipt or accrual of the amounts payable under this Section 9.3 and any tax
benefits actually recognized by such Tax Indemnitee as a result of the
indemnifiable Tax (including, without limitation, any benefits recognized as a
result of an indemnifiable Tax being utilized by such Tax Indemnitee as a credit
against Taxes not indemnifiable under this Section 9.3), shall equal the amount
of the Tax indemnifiable under this Section 9.3. The loss, disallowance or
recapture of such tax benefits taken into account by such Tax Indemnitee shall
be treated as a Tax subject to indemnity under this Section 9.3.1 without regard
to the provisions of Section 9.3.2 (other than Section 9.3.2(f)).

      (b) At Lessee's request, the computation of the amount of any indemnity
payment owed by Lessee or any amount owed by a Tax Indemnitee to Lessee pursuant
to this Section 9.3 shall be verified and certified by an independent public
accounting firm selected by such Tax Indemnitee and reasonably satisfactory to
Lessee. Such verification shall be binding. The costs of such verification
(including the fee of such public accounting firm) shall be borne by Lessee
unless such verification shall result in an adjustment in Lessee's favor of 5%
or more of the net present value (computed using a discount rate equal to the
Debt Rate, compounded monthly) of the payment as computed by such Tax
Indemnitee, in which case the costs shall be paid by such Tax Indemnitee.

      (c) Each Tax Indemnitee shall provide Lessee with such certifications,
information and documentation as shall be in such Tax Indemnitee's possession
and as shall be reasonably requested by Lessee to minimize any indemnity payment
pursuant to this Section 9.3; provided, that notwithstanding anything to the
contrary contained herein, no Tax Indemnitee shall be required to provide Lessee
with any Tax returns.

      (d) Each Tax Indemnitee shall promptly forward to Lessee any written
notice, bill or advice received by it from any Taxing Authority concerning any



Tax for which it seeks indemnification under this Section 9.3. Lessee shall pay
any amount for which it is liable pursuant to this Section 9.3 directly to the
appropriate Taxing Authority if legally permissible or upon demand of a Tax
Indemnitee, to such Tax Indemnitee within 30 days of such demand (or, if a
contest occurs in accordance with Section 9.3.4, within 30 days after a Final
Determination (as defined below)), but in no event more than two Business Days
prior to the date the Tax to which such amount payable hereunder relates is due.
If requested by a Tax Indemnitee in writing, Lessee shall furnish to the
appropriate Tax Indemnitee the original or a certified copy of a receipt for
Lessee's payment of any Tax paid by Lessee or such other evidence of payment of
such Tax as is acceptable to such Tax Indemnitee. Lessee shall also furnish
promptly upon written request such data as any Tax Indemnitee may reasonably
require to enable such Tax Indemnitee to comply with the requirements of any
taxing jurisdiction unless such data is not reasonably available to Lessee or,
unless such data is specifically requested by a Taxing Authority, is not
customarily furnished by domestic air carriers under similar circumstances. For
purposes of this Section 9.3, a "Final Determination" shall mean (i) a decision,
judgment, decree or other order by any court of competent jurisdiction that
occurs pursuant to the provisions of Section 9.3.4, which decision, judgment,
decree or other order has become final and unappealable (by law or by Lessee
hereunder), (ii) a closing agreement or settlement agreement entered into in
accordance with Section 9.3.4 that has become binding and is not subject to
further review or appeal (absent fraud, misrepresentation, etc.), or (iii) the
termination of administrative proceedings and the expiration of the time for
instituting a claim in a court proceeding.

      (e) If any Tax Indemnitee shall actually realize a tax savings by reason
of any Tax paid or indemnified by Lessee pursuant to this Section 9.3 (whether
such tax savings shall be by means of a foreign tax credit, depreciation or cost
recovery deduction or otherwise) and such savings is not otherwise taken into
account in computing such payment or indemnity, such Tax Indemnitee shall pay to
Lessee (within 30 days after the realization of such tax savings) an amount
equal to the lesser of (i) the amount of such tax savings, plus any additional
tax savings recognized as the result of any payment made pursuant to this
sentence, when, as, if, and to the extent, realized or (ii) the amount of all
payments (other than in respect of contest costs) pursuant to this Section 9.3
by Lessee to such Tax Indemnitee (less any payments previously made by such Tax
Indemnitee to Lessee pursuant to this Section 9.3.3 (e)) (and the excess, if
any, of the amount described in clause (i) over the amount described in clause
(ii) shall be carried forward and applied to reduce pro tanto any subsequent
obligations of Lessee to make payments to such Tax Indemnitee pursuant to this
Section 9.3); provided, that such Tax Indemnitee shall not be required to make
any payment pursuant to this sentence so long as a Lease Event of Default of a
monetary nature has occurred and is continuing. If a tax benefit is later
disallowed or denied, the disallowance or denial shall be treated as a Tax
indemnifiable under Section 9.3.1 without regard to the provisions of Section
9.3.2 (other than Section 9.3.2 (f)). Each such Tax Indemnitee shall in good
faith use reasonable efforts in filing its tax returns and in dealing with
Taxing Authorities to seek and claim any such tax benefit.

      (f) For purposes of this Section 9.3, items of foreign Tax of any Tax
Indemnitee shall be deemed to be utilized by such Tax Indemnitee as credits or
deductions for any taxable year in accordance with the following priorities:

            (x) First, all utilizable foreign Taxes (taking into account the
limitations of Section 904(d) of the Code) other than those described in clause
(y) below;




            (y) Second, all utilizable foreign Taxes (taking into account the
limitations of Section 904(d) of the Code) arising out of the transactions
contemplated by the Operative Agreements and other equipment leasing
transactions to the extent such Tax Indemnitee is indemnified or held harmless
for such Taxes by the Lessee or a lessee on a pari passu basis.

               9.3.4       CONTEST

      (a) If a written claim is made against a Tax Indemnitee for Taxes with
respect to which Lessee could be liable for payment or indemnity hereunder, or
if a Tax Indemnitee makes a determination that a Tax is due for which Lessee
could have an indemnity obligation hereunder, such Tax Indemnitee shall promptly
give Lessee notice in writing of such claim (provided, that failure to so notify
Lessee shall not relieve Lessee of its indemnity obligations hereunder unless
such failure to notify forecloses Lessee's rights to require a contest of such
claim) and shall take no action with respect to such claim without the prior
written consent of Lessee for 30 days following the receipt of such notice by
Lessee; provided, that, in the case of a claim made against a Tax Indemnitee, if
such Tax Indemnitee shall be required by law to take action prior to the end of
such 30-day period, such Tax Indemnitee shall, in such notice to Lessee, so
inform Lessee, and such Tax Indemnitee shall take no action for as long as it is
legally able to do so (it being understood that a Tax Indemnitee shall be
entitled to pay the Tax claimed and sue for a refund if (i)(A) the failure to so
pay the Tax would result in substantial penalties (unless immediately reimbursed
by Lessee) and the act of paying the Tax would not materially prejudice the
right to contest or (B) the failure to so pay would result in criminal penalties
and (ii) such Tax Indemnitee shall take any action so required in connection
with so paying the Tax in a manner that, in its good faith opinion, is the least
prejudicial to the pursuit of the contest). In addition, such Tax Indemnitee
shall (provided, that Lessee shall have agreed to keep such information
confidential other than to the extent necessary in order to contest the claim)
furnish Lessee with copies of any requests for information from any Taxing
Authority relating to such Taxes with respect to which Lessee may be required to
indemnify hereunder. If requested by Lessee in writing within 30 days after its
receipt of such notice, such Tax Indemnitee shall, at the expense of Lessee
(including, without limitation, all reasonable costs, expenses and reasonable
attorneys' and accountants' fees and disbursements), in good faith contest (or,
if permitted by applicable law to be contested by the Lessee in its own name,
allow Lessee to contest) through appropriate administrative and judicial
proceedings the validity, applicability or amount of such Taxes by (I) resisting
payment thereof, (II) not paying the same except under protest if protest is
necessary and proper or (III) if the payment is made, using reasonable efforts
to obtain a refund thereof in an appropriate administrative and/or judicial
proceeding. If requested to do so by Lessee, the Tax Indemnitee shall appeal any
adverse administrative or judicial decision, except that the Tax Indemnitee
shall not be required to pursue any appeals to the United States Supreme Court.
If and to the extent the Tax Indemnitee is able to separate the contested issue
or issues from other issues arising in the same administrative or judicial
proceeding that are unrelated to the transactions contemplated by the Operative
Agreements without, in the good faith judgment of such Tax Indemnitee, adversely
affecting such Tax Indemnitee, such Tax Indemnitee shall permit Lessee to
contest such matter in its own name, if permitted by applicable law, and shall
provide to Lessee (at Lessee's cost and expense) such information or data that
is in such Tax Indemnitee's control or possession that is reasonably necessary
to conduct such contest (other than such Tax Indemnitee's federal income tax
returns), and Lessee shall keep such Tax Indemnitee reasonably informed
concerning the progress of such contest and shall provide such Tax Indemnitee



with copies of all submissions and judicial and administrative proceedings. In
the case of a contest controlled by a Tax Indemnitee, such Tax Indemnitee shall
consult with Lessee in good faith regarding the manner of contesting such claim
and shall keep Lessee reasonably informed regarding the progress of such
contest. A Tax Indemnitee shall not fail to take any action expressly required
by this Section 9.3.4 (including, without limitation, any action regarding any
appeal of an adverse determination with respect to any claim) or settle or
compromise any claim without the prior written consent of the Lessee (except as
contemplated by Section 9.3.4(b) or (c)).

      (b) Notwithstanding the foregoing, in no event shall a Tax Indemnitee be
required to pursue any contest (or to permit Lessee to pursue any contest)
unless (i) Lessee shall have agreed to pay such Tax Indemnitee on demand all
reasonable costs and expenses incurred by such Tax Indemnitee in connection with
contesting such Taxes, including, without limitation, all reasonable out of
pocket costs and expenses and reasonable attorneys' and accountants' fees and
disbursements, (ii) if such contest shall involve the payment of the claim,
Lessee shall advance the amount thereof (to the extent indemnified hereunder)
plus interest, penalties and additions to tax with respect thereto that are
required to be paid prior to the commencement of such contest on an
interest-free and after-Tax basis to such Tax Indemnitee (and such Tax
Indemnitee shall promptly pay to the Lessee any net realized tax benefits
resulting from such advance including any tax benefits resulting from making
such payment), (iii) such Tax Indemnitee shall have reasonably determined that
the action to be taken will not result in any material risk of forfeiture, sale
or loss of the Aircraft (unless Lessee shall have made provisions to protect the
interests of any such Tax Indemnitee and the Owner Participant in a manner
reasonably satisfactory to such Tax Indemnitee and the Owner Participant)
(provided, that such Tax Indemnitee agrees to notify Lessee in writing promptly
after it becomes aware of any such risk), (iv) no Lease Event of Default shall
have occurred and be continuing unless Lessee has provided adequate security for
its obligations hereunder by advancing to such Tax Indemnitee before proceeding
or continuing with such contest, the amount of the Tax being contested, plus any
interest and penalties and an amount estimated in good faith by such Tax
Indemnitee for expenses, and (v) prior to commencing any judicial action
controlled by Lessee, Lessee shall have acknowledged its liability for such
claim hereunder, provided that Lessee shall not be bound by its acknowledgment
if the Final Determination articulates conclusions of law and fact that
demonstrate that Lessee has no liability for the contested amounts hereunder.
Notwithstanding the foregoing, if any Tax Indemnitee shall release, waive,
compromise or settle any claim which may be indemnifiable by Lessee pursuant to
this Section 9.3 without the written permission of Lessee, Lessee's obligation
to indemnify such Tax Indemnitee with respect to such claim (and all directly
related claims and claims based on the outcome of such claim) shall terminate,
subject to Section 9.3.4(c), and subject to Section 9.3.4(c), such Tax
Indemnitee shall repay to Lessee any amount previously paid or advanced to such
Tax Indemnitee with respect to such claim (other then contest costs), plus
interest at the rate that would have been payable by the relevant Taxing
Authority with respect to a refund of such Tax.

      (c) Notwithstanding anything contained in this Section 9.3, a Tax
Indemnitee will not be required to contest the imposition of any Tax and shall
be permitted to settle or compromise any claim without Lessee's consent if such
Tax Indemnitee (i) shall waive its right to indemnity under this Section 9.3
with respect to such Tax (and any directly related claim and any claim the
outcome of which is determined based upon the outcome of such claim), (ii) shall



pay to Lessee any amount previously paid or advanced by Lessee pursuant to this
Section 9.3 (other than contest costs) with respect to such Tax, plus interest
at the rate that would have been payable by the relevant Taxing Authority with
respect to a refund of such Tax, and (iii) shall agree to discuss with Lessee
the views or positions of any relevant Taxing Authority with respect to the
imposition of such Tax.

               9.3.5       REFUND

      If any Tax Indemnitee shall receive a refund of, or be entitled to a
credit against other liability for, all or any part of any Taxes paid,
reimbursed or advanced by Lessee, such Tax Indemnitee shall pay to Lessee within
30 days of such receipt an amount equal to the lesser of (a) the amount of such
refund or credit plus any net tax benefit (taking into account any Taxes
incurred by such Tax Indemnitee by reason of the receipt of such refund or
realization of such credit) actually realized by such Tax Indemnitee as a result
of any payment by such Tax Indemnitee made pursuant to this sentence (including
this clause (a)) and (b) such tax payment, reimbursement or advance by Lessee to
such Tax Indemnitee theretofore made pursuant to this Section 9.3 (and the
excess, if any, of the amount described in clause (a) over the amount described
in clause (b) shall be carried forward and applied to reduce pro tanto any
subsequent obligation of Lessee to make payments to such Tax Indemnitee pursuant
to this Section 9.3). If, in addition to such refund or credit, such Tax
Indemnitee shall receive (or be credited with) an amount representing interest
on the amount of such refund or credit, such Tax Indemnitee shall pay to Lessee
within 30 days of such receipt or realization of such credit that proportion of
such interest that shall be fairly attributable to Taxes paid, reimbursed or
advanced by Lessee prior to the receipt of such refund or realization of such
credit. If any such refund or credit or any interest thereon for which a Tax
Indemnitee shall have paid Lessee is later recaptured, denied, disallowed or
reduced, such recapture, denial, disallowance or reduction shall be treated as a
Tax indemnifiable under Section 9.3.1 without regard to the provisions of
Section 9.3.2 (other than Section 9.3.2(f)).

               9.3.6       TAX FILING

      If any report, return or statement is required to be filed with respect to
any Tax which is subject to indemnification under this Section 9.3, Lessee shall
timely file the same (except for any such report, return or statement which a
Tax Indemnitee has timely notified the Lessee in writing that such Tax
Indemnitee intends to file or which a Tax Indemnitee is required by law to file
in its own name); provided, that the relevant Tax Indemnitee shall furnish
Lessee with any information in such Tax Indemnitee's possession or control that
is reasonably necessary to file any such return, report or statement and is
reasonably requested in writing by Lessee (it being understood that the Tax
Indemnitee shall not be required to furnish copies of its actual tax returns,
although it may be required to furnish relevant information contained therein).
Lessee shall either file such report, return or statement and send a copy of
such report, return or statement to such Tax Indemnitee, and Owner Trustee if
the Tax Indemnitee is not Owner Trustee, or, where Lessee is not permitted to
file such report, return or statement, or if the same is required by law to be
filed in the Tax Indemnitee's own name, it shall notify such Tax Indemnitee in
writing of such requirement and prepare and deliver such report, return or
statement to such Tax Indemnitee in a manner satisfactory to such Tax Indemnitee
within a reasonable time prior to the time such report, return or statement is
to be filed.




               9.3.7       FORMS

      Each Tax Indemnitee agrees to furnish from time to time to Lessee or
Mortgagee or to such other person as Lessee or Mortgagee may designate, at
Lessee's or Mortgagee's request, such duly executed and properly completed forms
as may be necessary or appropriate in order to claim any reduction of or
exemption from any withholding or other Tax imposed by any Taxing Authority, if
(x) such reduction or exemption is available to such Tax Indemnitee, (y) Lessee
has provided such Tax Indemnitee with any information necessary to complete such
form not otherwise reasonably available to such Tax Indemnitee, and (z) if such
return is required to be filed in a jurisdiction outside the United States, the
Tax Indemnitee has not made a good faith determination that such filing would
subject it or any Affiliate to any adverse consequences in such jurisdiction for
which it has not been (and would not have been) indemnified.

               9.3.8       NON-PARTIES

      If a Tax Indemnitee is not a party to this Agreement, Lessee may require
the Tax Indemnitee to agree in writing, in a form reasonably acceptable to
Lessee, to the terms of this Section 9.3 and Section 15.8 prior to making any
payment to such Tax Indemnitee under this Section 9.3.

               9.3.9       SUBROGATION

      Upon payment of any Tax by Lessee pursuant to this Section 9.3 to or on
behalf of a Tax Indemnitee, Lessee, without any further action, shall be
subrogated to any claims that such Tax Indemnitee may have relating thereto.
Such Tax Indemnitee shall cooperate with Lessee (to the extent such cooperation
does not result in any unreimbursed cost, expense or liability to such Tax
Indemnitee) to permit Lessee to pursue such claims.

               9.3.10      FOREIGN TAX ON LOAN PAYMENTS

      If an Owner Participant is incorporated or organized, or maintains a place
of business or conducts activities (other than any activities of the Owner
Participant resulting from its participation in the transactions contemplated by
the Operative Agreements or resulting from any activities of Lessee in such
jurisdiction) in a country other than the United States or in a territory,
possession or commonwealth of the United States (within the meaning of the tax
law of that foreign jurisdiction) and if as a result thereof any foreign Taxes
(including withholding Taxes) are imposed on Pass Through Trustee, Pass Through
Trust, or any Note Holder, then Owner Participant shall reimburse Lessee for any
payments Lessee is required to make to or on behalf of Pass Through Trustee,
Pass Through Trust, or any Note Holder under this Section 9.3 as a result of the
imposition of such Taxes. The amount payable by Owner Participant to Lessee
shall be an amount which, after taking into account any such Taxes, any Tax
imposed upon the receipt or accrual by Lessee of such payment by Owner
Participant and any tax benefits or tax savings realized by Lessee with respect
to the payment of such withholding Tax or the payment hereunder, shall equal the
amount of Lessee's payment to or on behalf of such Pass Through Trustee, Pass
Through Trust or Note Holder.




      9.4      PAYMENTS

      Any payments made pursuant to Section 9.1 and Section 9.3 shall be due on
the 60th day after demand is made to the indemnifying party therefor (other than
any payments for which a different time is provided under Section 9.3.3 hereof)
and shall be made directly to the relevant Indemnitee or Tax Indemnitee or to
Lessee, in immediately available funds at such bank or to such account as
specified by such Indemnitee or Tax Indemnitee or Lessee, as the case may be, in
written directives to the payor, or, if no such direction shall have been given,
by check of the payor payable to the order of, and mailed to, such Indemnitee or
Tax Indemnitee or Lessee, as the case may be, by certified mail, postage
prepaid, at its address as set forth in this Agreement.

      9.5      INTEREST

      If any amount, payable by Lessee, any Indemnitee or any Tax Indemnitee
under Section 9.1 or 9.3 is not paid when due, the person obligated to make such
payment shall pay on demand, to the extent permitted by Law, to the person
entitled thereto, interest on any such amount for the period from and including
the due date for such amount to but excluding the date the same is paid, at the
Payment Due Rate. Such interest shall be paid in the same manner as the unpaid
amount in respect of which such interest is due.

      9.6      BENEFIT OF INDEMNITIES

      The obligations of Lessee in respect of all indemnities, obligations,
adjustments and payments in Section 9.1 or 9.3 are expressly made for the
benefit of, and shall be enforceable by, the Indemnitee or Tax Indemnitee
entitled thereto, without declaring the Lease to be in default or taking other
action thereunder, and notwithstanding any provision of the Trust Indenture.

SECTION 10.    ASSIGNMENT OR TRANSFER OF INTERESTS

      10.1     PARTICIPANTS, OWNER TRUSTEE AND NOTE HOLDERS

               10.1.1      OWNER PARTICIPANT

      (a) Owner Participant shall not Transfer any or all of its right, title or
interest in the Trust Estate or the Trust Agreement and to this Agreement
unless:

            (i) The Transferee shall have full power, authority and legal right
      to execute and deliver and to perform the obligations of Owner Participant
      under this Agreement and the other Owner Participant Agreements and shall
      provide reasonably satisfactory evidence of such power and authority to
      Lessee, Owner Trustee and Mortgagee;

            (ii) The Transferee shall enter into one or more legal, valid,
      binding and enforceable agreements effective to confirm that such
      Transferee agrees to be bound by all the terms of, and to undertake all of
      the obligations arising after such transfer of, the transferring Owner
      Participant contained in the Owner Participant Agreements and in which it
      makes representations and warranties substantially the same as those
      contained in Section 6.2 of this Participation Agreement;




            (iii) Lessee shall not be obligated to pay any greater amount or
      incur any greater obligation than that which it would have been obliged to
      pay or incur under the Lease or other Lessee Operative Agreement if no
      transfer or assignment had taken place, and the terms and conditions of
      the Lease and the other Lessee Operative Agreements insofar as they relate
      to the rights and obligations of Lessee or the Loan Participants shall not
      be altered;

            (iv) Owner Participant shall deliver to Lessee, Owner Trustee and
      Mortgagee an opinion of counsel reasonably satisfactory to each of them
      (which, if the Transferee is an Affiliate of the Owner Participant, may be
      in-house counsel to such Owner Participant) to the effect that such
      agreement or agreements referred to in Section 10.1.1(a)(ii) and, if
      applicable, 10.1.1(a)(vi) are legal, binding and enforceable in accordance
      with its or their terms and that such transfer will not violate applicable
      securities laws, the Act or any other applicable Law and is in accordance
      with this Section 10.1.1;

            (v) The Transferee is a Citizen of the United States (it being
      understood that the existence of any such requirement is to be determined
      without giving consideration to Section 47.9 of the FAA Regulations or any
      other provision that would restrict Lessee's use or operation of the
      Aircraft), or shall use a voting powers trust or similar arrangement in
      order to hold an interest in the Trust Estate such that the Aircraft can
      be registered in the United States (without giving consideration to
      Section 47.9 of the FAA Regulations or any other provision that would
      restrict Lessee's use or operation of the Aircraft);

            (vi) The Transferee shall be one person and shall be either (A) a
      Permitted Institution or (B) any other person (other than, without
      Lessee's consent, a commercial air carrier, a commercial aircraft
      operator, a freight forwarder or an Affiliate of any of the foregoing) the
      obligations of which under the Owner Participant Agreements are guaranteed
      by a Permitted Institution in any case, pursuant to a written guaranty, in
      form and substance reasonably satisfactory to Lessee, Owner Trustee and
      Mortgagee; and

            (vii) The Transferee shall be a "U.S. Person" as defined in Section
      7701(a)(30) of the Code (or any successor provision thereto).

      (b) Owner Participant shall give written notice to Lessee, Mortgagee and
Owner Trustee at least 10 days prior to any such Transfer, specifying the name
and address of the proposed Transferee, and providing financial statements of
the proposed Transferee evidencing satisfaction of the requirements described in
Section 10.1.1(a)(vi)(A) or (B) above.

      (c) Any fees, charges and expenses, including the reasonable legal fees,
charges and expenses incurred by Lessee, Owner Participant, Mortgagee, any Note
Holder or Owner Trustee in connection with any Transfer by Owner Participant
permitted by this Section 10.1.1, or by the Transferee in any such case, will be
paid for by Owner Participant.

               10.1.2      OWNER TRUSTEE

      Owner Trustee may transfer its interests in the Trust Agreement pursuant
to Section 9 thereof.




               10.1.3      NOTE HOLDERS

      Subject to Section 7.5.2 hereof and Section 2.07 of the Trust Indenture,
any Note Holder may, at any time and from time to time, Transfer or grant
participations in all or any portion of the Equipment Notes and/or all or any
portion of its beneficial interest in its Equipment Notes and the Trust
Indenture Estate to any person (it being understood that the sale or issuance of
Pass Through Certificates by the Pass Through Trustee shall not be considered a
Transfer or participation); provided, that any participant in any such
participations shall not have any direct rights under the Operative Agreements
or any Lien on all or any part of the Aircraft or Trust Indenture Estate and
neither Lessee, Lessor, nor Owner Participant shall have any increased liability
or obligations as a result of any such participation. In the case of any such
Transfer, the Transferee, by acceptance of Equipment Notes in connection with
such Transfer, shall be deemed to be bound by all of the covenants of Note
Holders contained in the Operative Agreements.

      10.2     EFFECT OF TRANSFER

      Upon any Transfer in accordance with Section 10.1.1, 10.1.2 or 10.1.3
(other than any Transfer by any Note Holder, to the extent it only grants
participations in Equipment Notes or in its beneficial interest therein),
Transferee shall be deemed an "Owner Participant," "Owner Trustee" or a "Note
Holder," respectively, for all purposes of this Agreement and the other
Operative Agreements and, in the case of a Transferee of any Participant or Note
Holder, shall be deemed to have paid its ratable portion of Lessor's Cost
previously made by Owner Participant or Loan Participant, respectively, making
such conveyance and represented by the interest being conveyed, and each
reference herein to Owner Participant, Owner Trustee or Note Holder,
respectively, shall thereafter be deemed a reference to such Transferee for all
purposes, and the transferring Owner Participant, Owner Trustee, Loan
Participant or Note Holder shall be released (except, in the case of Owner
Participant, to the extent of any guaranty provided by it under Section
10.1.1(a)(vi)) from all of its liabilities and obligations under this Agreement
and any other Operative Agreements to the extent such liabilities and
obligations arise after such Transfer and, in each case, to the extent such
liabilities and obligations are assumed by the Transferee; PROVIDED, that such
transferring Owner Participant, Owner Trustee or Note Holder (and its respective
Affiliates, successors, assigns, agents, servants, representatives, directors
and officers) will continue to have the benefit of any rights or indemnities
under any Operative Agreement vested or relating to circumstances, conditions,
acts or events prior to such Transfer.

SECTION 11.    [RESERVED]

SECTION 12.    SECTION 1110

      It is the intention of each of Lessee, Owner Participant, Loan
Participant, the Note Holders (such intention being evidenced by each of their
acceptance of an Equipment Note), Owner Trustee and Mortgagee that Owner
Trustee, as lessor under the Lease (and Mortgagee as assignee of Owner Trustee
under the Trust Indenture), shall be entitled to the benefits of Section 1110 in
the event of a case under Chapter 11 of the Bankruptcy Code in which Lessee is a
debtor. Lessee shall at all times be certificated and registered to the extent



necessary to entitle Owner Trustee to the rights afforded to lessors of aircraft
equipment under Section 1110 of the Bankruptcy Code.

SECTION 13.    CHANGE OF CITIZENSHIP

      13.1     GENERALLY

      Without prejudice to the representations, warranties or covenants
regarding the status of any party hereto as a Citizen of the United States:

      (a) Each of Lessee, Wells Fargo and WTC agrees that it will, immediately
upon obtaining knowledge of any facts that would cast doubt upon its continuing
status as a Citizen of the United States and promptly upon public disclosure of
negotiations in respect of any transaction which would or might adversely affect
such status, notify in writing all parties hereto of all relevant matters in
connection therewith; and

      (b) Owner Participant agrees that, in the event its status is to change or
has changed as a Citizen of the United States, or it makes public disclosure of
circumstances as a result of which it believes that such status is likely to
change, it will notify all the other parties to this Participation Agreement of
(i) such change in status promptly after obtaining Actual Knowledge thereof or
(ii) such belief as soon as practicable after such public disclosure but in any
event within ten Business Days after such public disclosure.

      13.2     OWNER PARTICIPANT

      Owner Participant agrees, solely for the benefit of Lessee and the Note
Holders that if, during such time as the Aircraft is registered in the United
States, (a) it shall not be a Citizen of the United States and (b) the Aircraft
shall be, or would therefore become, ineligible for registration in the name of
Owner Trustee under the Act and regulations then applicable thereunder (without
giving consideration to Section 47.9 of the FAA Regulations or any other
provision that may restrict Lessee's use or operation of the Aircraft), then
Owner Participant shall as soon as is reasonably practicable, but in any event
within 30 days after obtaining Actual Knowledge of such ineligibility and of
such loss of citizenship, (y) effect voting trust or other similar arrangements
(in which case any provisions contained in the Operative Agreements restricting
Owner Participant's or Owner Trustee's ability to amend the Trust Agreement
shall not apply to the extent necessary to permit the use of such a voting trust
or other similar arrangement) or take any other action as may be necessary to
prevent any deregistration or maintain the United States registration of the
Aircraft or (z) transfer in accordance with the terms of this Agreement all its
right, title and interest in and to this Agreement, the Trust Estate and the
Trust Agreement in accordance with Section 10.1.

      13.3     OWNER TRUSTEE

      Upon Wells Fargo giving any notice in accordance with Section 13.1(a),
Owner Trustee shall, subject to Section 9.1.1 of the Trust Agreement, resign as
Owner Trustee. Upon its receipt of such notice, Owner Participant shall as
promptly as practicable appoint a Citizen of the United States as successor
Owner Trustee pursuant to Section 9.1 of the Trust Agreement.




      13.4     MORTGAGEE

      Upon WTC giving any notice in accordance with Section 13.1(a), Mortgagee
shall (if and so long as such citizenship is necessary under the Act as in
effect at such time or, if it is not necessary, if and so long as Mortgagee's
citizenship could have any adverse effect on Lessee, any Participant or any Note
Holder), subject to Section 8.02 of the Trust Indenture, resign as Mortgagee
promptly upon its ceasing to be such a citizen.

SECTION 14.    CONCERNING OWNER TRUSTEE

      It is understood and agreed that, except as otherwise expressly provided
herein or in the Trust Agreement or the Trust Indenture, Owner Trustee is
entering into this Agreement solely in its capacity as trustee as provided in
the Trust Agreement and not in its individual capacity and in no case whatsoever
will it be liable or accountable in its individual capacity for any of the
statements, representations, warranties, agreements or obligations of Owner
Trustee hereunder, or for any loss in respect thereof, as to all of which the
parties agree to look solely to the Trust Estate; PROVIDED, that nothing in this
Section 14 shall be deemed to limit in scope or substance the personal liability
of Wells Fargo (a) to Owner Participant as expressly set forth in the Trust
Agreement, (b) in respect of the representations, warranties and agreements of
Wells Fargo expressly made as such herein or in any other Operative Agreement to
which it is a party, and (c) for the consequences of its own gross negligence,
willful misconduct, and, in receiving, handling or remitting of funds only, its
willful misconduct or simple negligence as a trustee.

SECTION 15.    MISCELLANEOUS

      15.1     AMENDMENTS

      No provision of this Agreement may be amended, supplemented, waived,
modified, discharged, terminated or otherwise varied orally, but only by an
instrument in writing that specifically identifies the provision of this
Agreement that it purports to amend, supplement, waive, modify, discharge,
terminate or otherwise vary and is signed by the party against which the
enforcement of the amendment, supplement, waiver, modification, discharge,
termination or variance is sought. Each such amendment, supplement, waiver,
modification, discharge, termination or variance shall be effective only in the
specific instance and for the specific purpose for which it is given. No
provision of this Agreement shall be varied or contradicted by oral
communication, course of dealing or performance or other manner not set forth in
an agreement, document or instrument in writing and signed by the party against
which enforcement of the same is sought.

      15.2     SEVERABILITY

      If any provision hereof 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 Agreement



shall be deemed to be a valid and binding agreement in all respects, enforceable
in accordance with its terms.

      15.3     SURVIVAL

      The indemnities set forth herein shall survive the delivery or return of
the Aircraft, the Transfer of any interest of Owner Participant in this
Agreement, the Trust Estate and the Trust Agreement, the Transfer of any
interest by any Note Holder of its Equipment Note and the expiration or other
termination of this Agreement or any other Operative Agreement.

      15.4     REPRODUCTION OF DOCUMENTS

      This Agreement, all annexes, schedules and exhibits hereto and all
agreements, instruments and documents relating hereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed and (b) financial statements, certificates and other information
previously or hereafter furnished to any party hereto, may be reproduced by such
party by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process, and such party may destroy any original
documents so reproduced. Any such reproduction shall be as admissible in
evidence as the original itself in any judicial or administrative proceeding
(whether or not the original is in existence and whether or not such
reproduction was made by such party in the regular course of business) and any
enlargement, facsimile or further reproduction of such reproduction likewise is
admissible in evidence.

      15.5     COUNTERPARTS

      This Agreement and any amendments, waivers, consents or supplements hereto
may be executed in any number of counterparts (or upon separate signature pages
bound together into one or more 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.

      15.6     NO WAIVER

      No failure on the part of any party hereto to exercise, and no delay by
any party hereto in exercising, any of its respective rights, powers, remedies
or privileges under this Agreement or provided at Law, in equity or otherwise
shall impair, prejudice or constitute a waiver of any such right, power, remedy
or privilege or be construed as a waiver of any breach hereof or default
hereunder or as an acquiescence therein nor shall any single or partial exercise
of any such right, power, remedy or privilege preclude any other or further
exercise thereof by it or the exercise of any other right, power, remedy or
privilege by it. No notice to or demand on any party hereto in any case shall,
unless otherwise required under this Agreement, entitle such party to any other
or further notice or demand in similar or other circumstances or constitute a
waiver of the rights of any party hereto to any other or further action in any
circumstances without notice or demand.

      15.7     NOTICES

      Unless otherwise expressly permitted by the terms hereof, all notices,
requests, demands, authorizations, directions, consents, waivers and other
communications required or permitted to be made, given, furnished or filed
hereunder shall be in writing (it being understood that the specification of a



writing in certain instances and not in others does not imply an intention that
a writing is not required as to the latter), shall refer specifically to this
Agreement or other applicable Operative Agreement, and shall be personally
delivered, sent by facsimile or telecommunication transmission (which in either
case provides written confirmation to the sender of its delivery), sent by
registered mail or certified mail, return receipt requested, postage prepaid, or
sent by overnight courier service, in each case to the respective address, or
facsimile number set forth for such party in Schedule 1, or to such other
address, facsimile or other number 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 facsimile
or telecommunication transmission, when confirmed, or (b) by registered or
certified mail, three Business Days after being deposited, properly addressed,
with the U.S. Postal Service.

      15.8     GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE

      (A) THIS AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE. THIS AGREEMENT IS BEING DELIVERED I