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EXPLANATORY NOTE

     This Amendment No. 2 to the Registration Statement on Form F-1 of Copa Holdings, S.A. is being filed solely for the purpose of filing exhibits.

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                                                                     EXHIBIT 1.1

                                14,000,000 SHARES

                               COPA HOLDINGS, S.A.

                       CLASS A COMMON STOCK, NO PAR VALUE


                         FORM OF UNDERWRITING AGREEMENT


December 14, 2005



                                                              December 14, 2005

Morgan Stanley & Co. Incorporated
      1585 Broadway
      New York, New York 10036

Goldman, Sachs & Co.
      One New York Plaza
      New York, New York 10004

Dear Ladies and Gentlemen:

      Corporacion de Inversiones Aereas, S.A., ("CIASA") and Continental
Airlines, Inc. ("CONTINENTAL" and, together with CIASA, the "SELLING
SHAREHOLDERS") severally propose to sell to the several Underwriters named in
Schedule I hereto (the "UNDERWRITERS"), an aggregate of 14,000,000 shares of
Class A Common Stock, without par value (the "FIRM SHARES") of Copa Holdings,
S.A., a Panamanian corporation (the "COMPANY"), each Selling Shareholder selling
the amount set forth opposite such Selling Shareholder's name in Schedule II
hereto. Morgan Stanley & Co. Incorporated ("MORGAN STANLEY") and Goldman, Sachs
& Co. ("GOLDMAN SACHS"), shall act as representatives (the "REPRESENTATIVES") of
the several Underwriters.

      The Selling Shareholders also propose to sell to the several Underwriters
not more than an additional 2,100,000 shares of Class A Common Stock, without
par value, of the Company (the "ADDITIONAL SHARES") if and to the extent that
you, as Representatives, shall have determined to exercise, on behalf of the
Underwriters, the right to purchase such Additional Shares granted to the
Underwriters in Section 4 hereof. To the extent the Underwriters elect to
purchase less than the full number of Additional Shares, such shares shall be
sold pro rata, subject to rounding, according to the Firm Shares sold by each of
the Selling Shareholders. The Firm Shares and the Additional Shares are
hereinafter collectively referred to as the "SHARES." The outstanding shares of
Class A Common Stock, without par value, of the Company, are hereinafter
referred to as the "COMMON STOCK."

      The Company has filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement on Form F-1 (File No. 333-129967),
including a prospectus, relating to the Shares. The registration statement as
amended at the time it becomes effective, including the information (if any)
deemed to be part of the registration statement at the time of effectiveness
pursuant to Rule 430A under the Securities Act of 1933, as amended (the
"SECURITIES ACT"), is hereinafter referred to as the "REGISTRATION STATEMENT";
the prospectus in the form first used to confirm sales of Shares (or in the form
first made available to the Underwriters by the Company to meet requests of
purchasers pursuant to Rule 173 under the Securities Act) is hereinafter
referred to as the "PROSPECTUS." If the Company has filed an abbreviated
registration statement to register additional shares of Common Stock pursuant to

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Rule 462(b) under the Securities Act (the "RULE 462 REGISTRATION STATEMENT"),
then any reference herein to the term "REGISTRATION STATEMENT" shall be deemed
to include such Rule 462 Registration Statement.

      For purposes of this Agreement, "FREE WRITING PROSPECTUS" has the meaning
set forth in Rule 405 under the Securities Act and "TIME OF SALE PROSPECTUS"
means the preliminary prospectus, together with the free writing prospectuses,
if any, as each are identified in Schedule III hereto and the price to the
public and the underwriting discount on the cover page of the Prospectus,
considered together. As used herein, the terms "Registration Statement,"
"preliminary prospectus," "Time of Sale Prospectus" and Prospectus shall include
the documents, if any, incorporated by reference therein. The terms
"SUPPLEMENT," "AMENDMENT," and "AMEND" as used herein with respect to the Time
of Sale Prospectus or any free writing prospectus shall include all documents
subsequently filed by the Company with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), that are incorporated by
reference therein.

      1. Representations and Warranties of the Company and Compania Panamena de
Aviacion, S.A. Each of the Company and Compania Panamena de Aviacion, S.A.
("COPA AIRLINES") represents and warrants to and agrees with each of the
Underwriters that:

      (a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or, to the Company's knowledge,
threatened by the Commission.

      (b) (i) The Registration Statement, when it became effective, did not
contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading,
(ii) the Registration Statement and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each
sale of the Shares in connection with the offering and at the Closing Date (as
defined in Section 6), the Time of Sale Prospectus, as then amended or
supplemented by the Company, if applicable, will not, contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading and (iv) the Prospectus does not contain and, as amended or
supplemented, if applicable, will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this paragraph do
not apply to statements or omissions in the Registration Statement, the Time of
Sale Prospectus or the Prospectus based upon information relating to any
Underwriter furnished to the Company in writing by such Underwriter through you
expressly for use therein.

      (c) The Company is not an "ineligible issuer," as defined in Rule 405 of
the Securities Act, in connection with the offering pursuant to Rules 164, 405
and 433 under the

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Securities Act. Any free writing prospectus that the Company is required to file
pursuant to Rule 433(d) under the Securities Act has been, or will be, filed
with the Commission in accordance with the requirements of the Securities Act
and the applicable rules and regulations of the Commission thereunder. Each free
writing prospectus that the Company has filed, or is required to file, pursuant
to Rule 433(d) under the Securities Act or that was prepared by or on behalf of
or used or referred to by the Company complies or will comply in all material
respects with the requirements of the Securities Act and the applicable rules
and regulations of the Commission thereunder. Except for the free writing
prospectuses, if any, identified in Schedule III hereto, and electronic road
shows, if any, furnished to you before first use, the Company has not prepared,
used or referred to, and will not, without your prior consent, prepare, use or
refer to, any free writing prospectus.

      (d) The Company has been duly incorporated, is validly existing as a
corporation (sociedad anonima) in good standing under the laws of the Republic
of Panama ("Panama"), has the corporate power and authority to own its property
and to conduct its business as described in the Time of Sale Prospectus and is
duly qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing or to have such power an authority would not
have a material adverse effect on the Company and its subsidiaries, taken as a
whole.

      (e) Each subsidiary of the Company (including Copa Airlines) has been duly
incorporated, is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described in the
Time of Sale Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing or to have
such power and authority would not have a material adverse effect on the Company
and its subsidiaries, taken as a whole; all of the issued shares of capital
stock of each subsidiary of the Company have been duly and validly authorized
and issued, are fully paid and non-assessable and are owned directly by the
Company (with the exception of the minority interests therein, as described in
the Time of Sale Prospectus), free and clear of all liens and similar
encumbrances, except as described in the Time of Sale Prospectus.

      (f) This Agreement has been duly authorized, executed and delivered by the
Company and Copa Airlines.

      (g) The authorized capital stock of the Company conforms in all material
respects as to legal matters to the description thereof contained in each of the
Time of Sale Prospectus and the Prospectus.

      (h) The shares of Common Stock (including the Shares to be sold by the
Selling Shareholders) have been duly authorized and are validly issued, fully
paid and non-assessable.

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      (i) The execution and delivery by the Company of, and the performance by
the Company of its obligations under, this Agreement will not contravene any
provision of (i) the certificate of incorporation or by-laws of the Company,
(ii) any agreement or other instrument binding upon the Company or any of its
subsidiaries or (iii) applicable law or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or any
subsidiary, except in the case of (ii) and (iii), as would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole. No
consent, approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the Company of
its obligations under this Agreement, except (i) such as may be required by the
securities or Blue Sky laws of the various states in connection with the offer
and sale of the Shares or (ii) such as would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole, or on the Company's
ability to perform its obligations under the Agreement.

      (j) The execution and delivery by Copa Airlines of, and the performance by
Copa Airlines of its obligations under, this Agreement will not contravene any
provision of (i) the certificate of incorporation or by-laws of Copa Airlines,
(ii) any agreement or other instrument binding upon Copa Airlines or (iii)
applicable law or any judgment, order or decree of any governmental body, agency
or court having jurisdiction over Copa Airlines, except in the case of (ii) and
(iii), as would not have a material adverse effect on Copa Airlines. No consent,
approval, authorization or order of, or qualification with, any governmental
body or agency is required for the performance by Copa Airlines of its
obligations under this Agreement, except (i) such as may be required by the
securities or Blue Sky laws of the various states in connection with the offer
and sale of the Shares or (ii) such as would not have a material adverse effect
on Copa Airlines or on Copa Airlines' ability to perform its obligations under
the Agreement

      (k) There has not occurred any material adverse change in the condition,
financial or otherwise, or in the earnings, business, operations or prospects of
the Company and its subsidiaries, taken as a whole, from that set forth in the
Time of Sale Prospectus.

      (l) There are no legal or governmental proceedings pending or, to the
Company's knowledge, threatened to which the Company or any of its subsidiaries
is a party or to which any of the properties of the Company or any of its
subsidiaries is subject that are required to be described in the Registration
Statement or the Prospectus and are not so described and there are no statutes,
regulations, contracts or other documents that are required to be described in
the Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required. The Time of
Sale Prospectus does not contain any description of the foregoing matters that
is materially different from those contained in the Prospectus.

      (m) Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when so filed in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder.

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      (n) Neither the Company nor Copa Airlines is, and immediately after giving
effect to the offering and sale of the Shares neither of them will be, required
to register as an "investment company" as such term is defined in the Investment
Company Act of 1940, as amended.

      (o) The Company and its subsidiaries (i) are in compliance with any and
all applicable foreign, federal, state and local laws and regulations relating
to the protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"),
(ii) have received all permits, licenses or other approvals required of them
under applicable Environmental Laws to conduct their respective businesses and
(iii) are in compliance with all terms and conditions of any such permit,
license or approval, except in each case where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a material
adverse effect on the Company and its subsidiaries, taken as a whole.

      (p) There are no costs or liabilities associated with Environmental Laws
(including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws or any
permit, license or approval, any related constraints on operating activities and
any potential liabilities to third parties) that would, singly or in the
aggregate, have a material adverse effect on the Company and its subsidiaries,
taken as a whole.

      (q) There are no contracts, agreements or understandings either between
the Company or Copa Airlines and any person granting such person the right to
require the Company or Copa Airlines to file a registration statement under the
Securities Act with respect to any securities of the Company or Copa Airlines or
to require the Company to include such securities with the Shares registered
pursuant to the Registration Statement, except as contemplated in the
registration rights agreement by and among the Company, CIASA and Continental
(the "REGISTRATION RIGHTS AGREEMENT") dated as of the date hereof.

      (r) Subsequent to the respective dates as of which information is given in
each of the Registration Statement, the Time of Sale Prospectus and the
Prospectus, (i) the Company and its subsidiaries have not incurred any material
liability or obligation, direct or contingent, nor entered into any material
transaction; (ii) the Company has not purchased any of its outstanding capital
stock, nor declared, paid or otherwise made any dividend or distribution of any
kind on its capital stock other than ordinary and customary dividends; and (iii)
there has not been any material change in the capital stock, short-term debt or
long-term debt of the Company and its subsidiaries, except in each case as
described in each of the Registration Statement, the Time of Sale Prospectus and
the Prospectus, respectively; and (iv) there has been no prohibition or
suspension of the operation of either the Company's or Copa Airlines' aircraft,
including, but not limited to, as a result of action taken by the Panamanian
Department of Civil Aviation (the Autoridad de Aeronautica Civil) (the "AAC") or
other applicable bodies in the other jurisdictions in which Copa Airlines or
AeroRepublica S.A. ("AEROREPUBLICA") operates, except as would not have a
material adverse effect on the Company and its subsidiaries, taken as a whole.

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      (s) The Company and its subsidiaries have good and marketable title to all
real property and good and marketable title to all personal property owned by
them that is material to the business of the Company and its subsidiaries, taken
as a whole, in each case free and clear of all liens, encumbrances and defects
except such as are described in the Time of Sale Prospectus or such as do not
materially affect the value of such property or do not materially interfere with
the use made and proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases except as are not material or do not materially interfere
with the use made and proposed to be made of such property and buildings by the
Company and its subsidiaries, in each case except as described in the Time of
Sale Prospectus.

      (t) The Company and its subsidiaries own or have the valid right to use,
or can acquire on reasonable terms, all material patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems
or procedures), trademarks, service marks and trade names currently employed by
them in connection with the business now operated by them, except where the
failure to so own or have the right to use would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole, and neither the
Company nor any of its subsidiaries has received any notice of infringement of
or conflict with asserted rights of others with respect to any of the foregoing
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a material adverse effect on the Company and its
subsidiaries, taken as a whole.

      (u) No material labor dispute with the employees of the Company or any of
its subsidiaries exists, except as described in the Time of Sale Prospectus, or,
to the knowledge of the Company, is imminent; and the Company is not aware of
any existing, threatened or imminent labor disturbance by the employees of any
of its principal suppliers, manufacturers or contractors that could have a
material adverse effect on the Company and its subsidiaries, taken as a whole.

      (v) The Company and each of its subsidiaries and its owned and leased
properties, including its airplanes, are insured by insurers of recognized
financial responsibility against such losses and risks and in such amounts as
are prudent and customary in the businesses in which they are engaged; neither
the Company nor any of its subsidiaries has been refused any insurance coverage
sought or applied for; and neither the Company nor any of its subsidiaries has
any reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at a cost that
would not have a material adverse effect on the Company and its subsidiaries,
taken as a whole, except as described in the Time of Sale Prospectus.

      (w) The Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or foreign
regulatory authorities necessary to conduct their respective businesses except
where the failure to so possess would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole, and neither the

                                       6


Company nor any of its subsidiaries has received any notice of proceedings
relating to the revocation or modification of any such certificate,
authorization or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would have a material adverse effect on
the Company and its subsidiaries, taken as a whole, except as described in the
Time of Sale Prospectus.

      (x) Except as described in the Time of Sale Prospectus, the Company and
each of its subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management's general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. Except as described in the Time of Sale Prospectus, since the end
of the Company's most recent audited fiscal year, there has been (i) no material
weakness in the Company's internal control over financial reporting (whether or
not remediated) and (ii) no change in the Company's internal control over
financial reporting that has materially and adversely affected, or is reasonably
likely to materially and adversely affect, the Company's internal control over
financial reporting.

      (y) Except as described in the Time of Sale Prospectus, the Company has
not sold, issued or distributed any shares of Common Stock during the six-month
period preceding the date hereof, including any sales pursuant to Rule 144A
under, or Regulation D or S of, the Securities Act, other than shares issued
pursuant to employee benefit plans, qualified stock option plans or other
employee compensation plans or pursuant to outstanding options, rights or
warrants.

      (z) There are no contracts, agreements or understandings between either
the Company or any of its subsidiaries and any person that would give rise to a
valid claim against either the Company or any of its subsidiaries or any
Underwriter for a brokerage commission, finder's fee or other like payment in
connection with this offering.

      (aa) The Company's auditor and the Audit Committee of its Boards of
Directors have not been advised of (i) any significant deficiencies in the
design or operation of internal controls that could adversely affect the
Company's ability to record, process, summarize, and report financial data, (ii)
any fraud, whether or not material, that involves management or other employees
who have a role in the Company's internal controls and (iii) any material
weaknesses in internal controls identified by the Company's auditors; and since
the date of the most recent evaluation of the Company's disclosure controls and
procedures, there have been no significant changes in internal controls or in
other factors that could significantly and adversely affect internal controls,
including any corrective actions with regard to significant deficiencies and
material weaknesses, other than as described in the Time of Sale Prospectus.

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      (bb) The Company is a "foreign private issuer," as defined in Rule 3b-4
under the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT").

      (cc) As of the date hereof, the Company and each of its subsidiaries, as
well as the directors and officers of the Company, are each in compliance in all
material respects with all applicable to the Company effective provisions of the
Sarbanes-Oxley Act of 2002 in effect and applicable as of the date hereof and
the rules and regulations of the Commission and the New York Stock Exchange (the
"NYSE") promulgated thereunder as of the date hereof.

      (dd) Ernst & Young, who have certified certain financial statements of the
Company and its subsidiaries, are independent public accountants as required by
the Exchange Act and the rules and regulations of the Commission thereunder.

      (ee) The Company maintains a system of internal control over financial
reporting (as such term is defined in Rule 13a-15(f) of the Exchange Act) that
complies with the requirements of the Exchange Act and has been designed by the
Company's principal executive officer and principal financial officer, or under
their supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. Except as
disclosed in the Prospectus, the Company's internal control over financial
reporting is effective and the Company is not aware of any material weaknesses
in its internal control over financial reporting.

      (ff) The Company maintains disclosure controls and procedures (as such
term is defined in Rule 13a-15(e) of the Exchange Act) that comply with the
requirements of the Exchange Act; such disclosure controls and procedures have
been designed to provide reasonable assurance that material information relating
to the Company and its subsidiaries is made known to the Company's principal
executive officer and principal financial officer by others within those
entities; and such disclosure controls and procedures are effective, except as
described in the Prospectus.

      (gg) Each of the Company and Copa Airlines has the power to submit, and
pursuant to Section 16 of this Agreement has legally, validly, effectively and
irrevocably submitted, to the jurisdiction of the courts of the State of New
York and of the United States sitting in the Borough of Manhattan and has the
power to designate, appoint and empower, and pursuant to Section 16 of this
Agreement, has legally, validly and effectively designated, appointed and
empowered an agent for service of process in any suit or proceeding arising out
of or relating to this Agreement.

      (hh) The Company has applied to (i) list the Shares on the NYSE and (ii)
register the shares with the National Securities Commission of Panama (the
Comision Nacional de Valores).

      (ii) The audited consolidated financial statements as of and for the
period ending December 31, 2004 and the unaudited consolidated financial
statements as of and for the period ending September 30, 2005, included in each
of the Time of Sale Prospectus and the Prospectus, together with the related
notes and schedules, present fairly in all material respects the financial
position of each of the Company and its subsidiaries as at the dates indicated
and the results of

                                       8


operations and statement of changes in financial position of each of the Company
and its subsidiaries for the periods specified; such financial statements have
been prepared in conformity with U.S. GAAP applied on a consistent basis during
the periods involved (except as otherwise disclosed therein); the other
financial and statistical data set forth in the Prospectus are accurately
presented in all material respects and prepared, where applicable, on a basis
consistent with the financial statements and books and records of each of the
Company and its subsidiaries; and neither the Company nor its subsidiaries has
any material liabilities or obligations, direct or contingent (including any
off-balance sheet obligations), not disclosed in the Time of Sale Prospectus or
the Prospectus.

      (jj) Neither the Company nor any of its subsidiaries has sustained, since
the date of the last audited financial statements, any material loss or
interference with its business from fire, explosion, flood or other calamity,
regardless of whether covered by insurance.

      (kk) Any statistical and market-related data included in each of the Time
of Sale Prospectus and Prospectus are based on or derived from sources that each
of the Company and Copa Airlines believes to be reasonably reliable and
accurate, and the Company or Copa Airlines has obtained the written consent to
the use of such data from such sources to the extent required.

      (ll) All tax returns required to be filed by each of the Company and its
subsidiaries in all applicable jurisdictions have been filed, and all taxes and
other assessments of a similar nature (whether imposed directly or through
withholding) including any interest, additions to tax or penalties applicable
thereto due or claimed to be due from either the Company or any of its
subsidiaries have been paid, other than those being contested in good faith and
for which adequate reserves have been provided, except as otherwise described in
the Time of Sale Prospectus or where the failures to so file or so pay would not
reasonably be expected to have a material adverse effect on the Company and its
subsidiaries, taken as a whole.

      (mm) Except as described in the Time of Sale Prospectus, there is no tax,
duty, levy, impost, deduction, charge or withholding imposed by Panama or any
political subdivision thereof or taxing authority therein either (i) on or by
virtue of the execution, delivery, performance or enforcement of this Agreement
or of any other document to be furnished hereunder or thereunder by the Company
or Copa Airlines, or (ii) on any payment to be made pursuant to this Agreement.

      (nn) Neither the Company nor any of its subsidiaries has sent or received
any communication regarding termination of, or intent not to renew, any of the
contracts or agreements referred to or described in the Time of Sale Prospectus,
except where such termination or non-renewal would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole, and no such
termination or non-renewal has been threatened by either the Company or any of
its subsidiaries, or, to the best of each of the Company's and Copa Airlines'
knowledge, by any other party to any such contract or agreement.

      (oo) This Agreement is in proper legal form under the laws of Panama for
the enforcement thereof in Panama against the Company and Copa Airlines, and it
is not necessary

                                       9


in order to ensure the legality, validity, enforcement or admissibility into
evidence of this Agreement in Panama that this Agreement be filed or recorded
with any court or other authority in Panama or that any tax or fee be paid in
Panama on or in respect of this Agreement or any other document, other than
court costs, including (without limitation) filing fees and deposits to secure
judgments, except that, with respect to enforcement or admissibility into
evidence (i) the signatures of the parties thereto signing outside Panama shall
have been notarized by a notary public licensed as such under the law of the
place of signing and the signature of such notary public shall have been
legalized by the relevant Panamanian Consulate or by an apostille, and (ii) this
Agreement shall have been translated into Spanish by a licensed translator in
Panama.

      (pp) The audiovisual presentation made available to the public by the
Company at [http://www.netroadshow.com/[address]][or Copa address] is a "bona
fide electronic roadshow" for purposes of Rule 433(d)(8)(ii) of the Securities
Act, and such presentation, together with the Time of Sale Prospectus, does not
contain any untrue statement of material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, except that the representations and
warranties set forth in this paragraph do not apply to statements or omissions
in such presentation or Time of Sale Prospectus based upon information relating
to any Underwriter furnished to the Company in writing by such Underwriter
expressly for use therein.

      2. Representations and Warranties of the Selling Shareholders. Each
Selling Shareholder, severally and not jointly represents and warrants to and
agrees with each of the Underwriters that:

      (a) Except for the free writing prospectuses, if any, identified in
Schedule III hereto, and electronic road shows, if any, furnished to you before
first use, such Selling Shareholder has not prepared, used or referred to, and
will not, without your prior consent, prepare, use or refer to, any free writing
prospectus.

      (b) This Agreement has been duly authorized, executed and delivered by or
on behalf of such Selling Shareholder.

      (c) The execution and delivery by such Selling Shareholder of, and the
performance by such Selling Shareholder of its obligations under, this Agreement
will not contravene (i) any provision of applicable law, (ii) the certificate of
incorporation or by-laws of such Selling Shareholder (if such Selling
Shareholder is a corporation), or (iii) any agreement or other instrument
binding upon such Selling Shareholder or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over such Selling
Shareholder, except for such contraventions in the case of (i) and (iii) as
would not have a material adverse effect on the Company or its subsidiaries,
taken as a whole, or on such Selling Shareholder's ability to consummate the
transactions contemplated hereby. No consent, approval, authorization or order
of, or qualification with, any governmental body or agency is required for the
performance by such Selling Shareholder of its obligations under this Agreement,
except (i) such as may be required by the securities or Blue Sky laws of the
various states in connection with the offer and sale of the Shares and (ii) as
would not have a material adverse effect on the Company or its

                                       10


subsidiaries, taken as a whole, or on such Selling Shareholder's ability to
consummate the transactions contemplated hereby.

      (d) Such Selling Shareholder owns, and on the Closing Date will own, the
Shares to be sold by such Selling Shareholder free and clear of all security
interests, claims, liens, equities or other encumbrances and has, and on the
Closing Date will have, the legal right and power, and all authorizations and
approvals required by law, to enter into this Agreement and to sell, transfer
and deliver the Shares to be sold by such Selling Shareholder.

      (e) Upon payment for the Shares to be sold by such Selling Shareholder
pursuant to this Agreement, delivery of such Shares, as directed by the
Underwriters, to Cede & Co. ("CEDE") or such other nominee as may be designated
by the Depository Trust Company ("DTC"), registration of such Shares in the name
of Cede or such other nominee and the crediting of such Shares on the books of
DTC to securities accounts of the Underwriters (assuming that neither DTC nor
any such Underwriter has notice of any adverse claim (within the meaning of
Section 8-105 of the New York Uniform Commercial Code (the "UCC")) to such
Shares), (A) DTC shall be a "protected purchaser" of such Shares within the
meaning of Section 8-303 of the UCC, (B) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of such Shares
and (C) no action based on any "adverse claim", within the meaning of Section
8-102 of the UCC, to such Shares may be asserted against the Underwriters with
respect to such security entitlement; for purposes of this representation, such
Selling Shareholder may assume that when such payment, delivery and crediting
occur, (x) such Shares will have been registered in the name of Cede or another
nominee designated by DTC, in each case on the Company's share registry in
accordance with its certificate of incorporation, bylaws and applicable law, (y)
DTC will be registered as a "clearing corporation" within the meaning of Section
8-102 of the UCC and (z) appropriate entries to the accounts of the several
Underwriters on the records of DTC will have been made pursuant to the UCC.

      (f) Upon payment for the Shares to be sold to the Underwriters by such
Selling Shareholders pursuant to this Agreement, all right, title and interest
in the Shares will be transferred to the Underwriters free and clear of all
security interests, claims, liens, equities or other encumbrances.

      (g) Such Selling Shareholder has no knowledge that the representations and
warranties of the Company and Copa Airlines contained in Section 1 are not true
and correct, is familiar with the Registration Statement and Prospectus and has
no knowledge of any untrue statement of material fact or omission to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Such Selling
Shareholder is not prompted by any information concerning the Company or its
subsidiaries that is not set forth in the Time of Sale Prospectus to sell its
Shares pursuant to this Agreement. The liability of each Selling Shareholder for
a breach of the representations and warranties contained in this paragraph shall
be limited to an amount equal to the aggregate Public Offering Price of the
Shares sold by such Selling Shareholder under this Agreement.

                                       11


      (h) (i) The Registration Statement, when it became effective, did not
contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading,
(ii) the Time of Sale Prospectus does not, and at the time of each sale of the
Shares in connection with the offering and at the Closing Date (as defined in
Section 6), the Time of Sale Prospectus, as then amended or supplemented by the
Company, if applicable, will not, contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading and
(iii) the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph 2(h) apply only to
statements or omissions in the Registration Statement, the Time of Sale
Prospectus or the Prospectus based upon information relating to the Selling
Shareholder that is furnished to the Company in writing by such Selling
Shareholder expressly for use therein. The liability of each Selling Shareholder
for a breach of the representations and warranties contained in this paragraph
shall be limited to an amount equal to the aggregate Public Offering Price of
the Shares sold by such Selling Shareholder under this Agreement.

      (i) In order to document the Underwriters' compliance with the reporting
and withholding provisions of the Tax Equity and Fiscal Responsibility Act of
1982 with respect to the transactions herein contemplated, such Selling
Shareholder will deliver to the Representatives prior to or at the Closing Date
a properly completed and executed U.S. Treasury Department Form W-9 (or other
applicable form or statement specified by the U.S. Treasury Department
regulations in lieu thereof).

      (j) Except as disclosed by such Selling Shareholder in writing to the
Representatives, neither such Selling Shareholder nor any of his, her or its
affiliates directly, or indirectly through one or more intermediaries, controls,
or is controlled by, or is under common control with, or has any other
association with (within the meaning of Article 1(q) of the By-laws of the
National Association of Securities Dealers, Inc. (the "NASD")), any member firm
of the NASD.

      3. Representations and Warranties of CIASA. CIASA represents and warrants
to and agrees with each of the Underwriters that:

      (a) This Agreement is in proper legal form under the laws of Panama for
the enforcement thereof in Panama against CIASA, and it is not necessary in
order to ensure the legality, validity, enforcement or admissibility into
evidence of this Agreement in Panama that this Agreement be filed or recorded
with any court or other authority in Panama or that any tax or fee be paid in
Panama on or in respect of this Agreement or any other document, other than
court costs, including (without limitation) filing fees, except that, with
respect to enforceability or admissibility into evidence (i) the signatures of
the parties thereto signing outside Panama shall have been notarized by a notary
public licensed as such under the law of the place of signing and the signature
of such notary public shall have been legalized by the relevant

                                       12


Panamanian Consulate or by an apostille, and (ii) this Agreement shall have been
translated into Spanish by a licensed translator in Panama.

      (b) CIASA has the power to submit, and pursuant to Section 16 of this
Agreement, has legally, validly, effectively and irrevocably submitted, to the
jurisdiction of the courts of the State of New York and of the United States
sitting in the Borough of Manhattan and has the power to designate, appoint and
empower, and pursuant to Section 16 of this Agreement, has legally, validly and
effectively designated, appointed and empowered an agent for service of process
in any suit or proceeding arising out of or relating to this Agreement.

      4. Agreements to Sell and Purchase. Each Selling Shareholder, severally
and not jointly, hereby agrees to sell to the several Underwriters, and each
Underwriter, upon the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, agrees, severally
and not jointly, to purchase from such Selling Shareholder at $[ ] a share (the
"PURCHASE PRICE") the number of Firm Shares (subject to such adjustments to
eliminate fractional shares as you may determine) that bears the same proportion
to the number of Firm Shares to be sold by such Selling Shareholders as the
number of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.

      On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Selling Shareholders,
severally and not jointly, agree to sell to the Underwriters the Additional
Shares, and the Underwriters shall have the right to purchase, severally and not
jointly, up to 2,100,000 Additional Shares at the Purchase Price. You may
exercise this right on behalf of the Underwriters in whole or from time to time
in part by giving written notice not later than 30 days after the date of this
Agreement. Any exercise notice shall specify the number of Additional Shares to
be purchased by the Underwriters and the date on which such shares are to be
purchased. Each purchase date must be at least two business day after the
written notice is given and may not be earlier than the closing date for the
Firm Shares nor later than ten business days after the date of such notice.
Additional Shares may be purchased as provided in Section 5 hereof solely for
the purpose of covering over-allotments made in connection with the offering of
the Firm Shares. On each day, if any, that Additional Shares are to be purchased
(an "OPTION CLOSING DATE"), each Underwriter agrees, severally and not jointly,
to purchase the number of Additional Shares (subject to such adjustments to
eliminate fractional shares as you may determine) that bears the same proportion
to the total number of Additional Shares to be purchased on such Option Closing
Date as the number of Firm Shares set forth in Schedule I hereto opposite the
name of such Underwriter bears to the total number of Firm Shares.

      Each of the Company and the Selling Shareholders hereby agrees that,
without the prior written consent of the Representatives on behalf of the
Underwriters, it will not, during the period ending 180 days after the date of
the Prospectus, (1) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend, or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for

                                       13


Common Stock or (2) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
the Common Stock, whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise or (3) file any registration statement with the Commission
relating to the offering of any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock.

      The restrictions contained in the preceding paragraph shall not apply to
(a) the Shares to be sold hereunder, or (b) transactions by a Selling
Shareholder relating to shares of Common Stock or other securities acquired in
open market transactions after the completion of the offering of the Shares,
provided that no filing under Section 16(a) of the Exchange Act shall be
required or shall be voluntarily made in connection with subsequent sales of
Common Stock or other securities acquired in such open market transactions or
(c) any existing employee benefits plan. In addition, each Selling Shareholder,
agrees that, without the prior written consent of the Representatives on behalf
of the Underwriters, it will not, during the period ending 180 days after the
date of the Prospectus, make any demand for, or exercise any right with respect
to, the registration of any shares of Common Stock or any security convertible
into or exercisable or exchangeable for Common Stock. Each Selling Shareholder
consents to the entry of stop transfer instructions with the Company's transfer
agent and registrar against the transfer of any Shares held by such Selling
Shareholder except in compliance with the foregoing restrictions.
Notwithstanding the foregoing, if (1) during the last 17 days of the 180-day
restricted period the Company issues an earnings release or material news or a
material event relating to the Company occurs; or (2) prior to the expiration of
the 180-day restricted period, the Company announces that it will release
earnings results during the 16-day period beginning on the last day of the
180-day period, the restrictions imposed by this agreement shall continue to
apply until the expiration of the 18-day period beginning on the issuance of the
earnings release or the occurrence of the material news or material event. The
Company shall promptly notify the Representatives of any earnings release, news
or event that may give rise to an extension of the initial 180 day restricted
period.

      5. Terms of Public Offering. The Selling Shareholders are advised by you
that the Underwriters propose to make a public offering of their respective
portions of the Shares as soon after the Registration Statement and this
Agreement have become effective as in your judgment is advisable. The Selling
Shareholders are further advised by you that the Shares are to be offered to the
public initially at $[ ] a share (the "PUBLIC OFFERING PRICE") and to certain
dealers selected by you at a price that represents a concession not in excess of
$[ ] a share under the Public Offering Price, and that any Underwriter may
allow, and such dealers may reallow, a concession, not in excess of $[ ] a
share, to any Underwriter or to certain other dealers.

      6. Payment and Delivery. Payment for the Firm Shares to be sold by each
Selling Shareholder shall be made to such Selling Shareholder in Federal or
other funds immediately available in New York City against delivery of such Firm
Shares for the respective accounts of the several Underwriters at 10:00 a.m.,
New York City time, on [ ], 2005 or at such other time on the same or such other
date, not later than [ ], 2005 as shall be designated in writing by you. The
time and date of such payment are hereinafter referred to as the "CLOSING DATE."

                                       14


      Payment for any Additional Shares shall be made to the Selling
Shareholders in Federal or other funds immediately available in New York City
against delivery of such Additional Shares for the respective accounts of the
several Underwriters at 10:00 a.m., New York City time, on the date specified in
the corresponding notice described in Section 4 or at such other time on the
same or on such other date, in any event not later than [ ], 2005, as shall be
designated in writing by you.

      The Firm Shares and Additional Shares shall be registered in the name of
Cede. The Firm Shares and Additional Shares shall be delivered to you on the
Closing Date or an Option Closing Date, as the case may be, for the respective
accounts of the several Underwriters, with any transfer taxes payable in
connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.

      7. Conditions to the Underwriters' Obligations. The obligations of the
Selling Shareholders to sell the Shares to the Underwriters and the several
obligations of the Underwriters to purchase and pay for the Shares on the
Closing Date are subject to the condition that the Registration Statement shall
have become effective not later than [5:00 p.m.] (New York City time) on the
date hereof.

      The several obligations of the Underwriters are subject to the following
further conditions:

      (a) Subsequent to the execution and delivery of this Agreement and prior
to the Closing Date:

            (i) there shall not have occurred any downgrading, nor shall any
      notice have been given of any intended or potential downgrading or of any
      review for a possible change that does not indicate the direction of the
      possible change, in the rating accorded any of the securities of the
      Company or any of its subsidiaries by any "nationally recognized
      statistical rating organization," as such term is defined for purposes of
      Rule 436(g)(2) under the Securities Act; and

            (ii) there shall not have occurred any change, or any development
      involving a prospective change, in the condition, financial or otherwise,
      or in the earnings, business or operations of the Company and its
      subsidiaries, taken as a whole, from that set forth in the Time of Sale
      Prospectus that, in your judgment, is material and adverse and that makes
      it, in your judgment, impracticable to market the Shares on the terms and
      in the manner contemplated in the Time of Sale Prospectus.

      (b) The Underwriters shall have received on the Closing Date (i) a
certificate, dated the Closing Date and signed by an executive officer of the
Company and Copa Airlines, to the effect set forth in Section 7(a) above and to
the effect that the representations and warranties of each of the Company and
Copa Airlines contained in this Agreement are true and correct as of the Closing
Date and that each of the Company and Copa Airlines has complied in all material
respects with all of the agreements and satisfied all of the conditions on its
part to be performed

                                       15


or satisfied hereunder on or before the Closing Date and (ii) a certificate,
dated the Closing Date and signed by an executive officer of CIASA, containing
such certifications as the Underwriters have previously requested in writing
from CIASA, and which certifications shall constitute representations and
warranties of CIASA to the same extent as if made by CIASA in Section 2 hereof.

      The officer signing and delivering such certificate may rely upon the best
of his or her knowledge as to proceedings threatened.

      (c) The Underwriters shall have received on the Closing Date an opinion of
Galindo, Arias & Lopez, special outside counsel for each of the Company, Copa
Airlines and CIASA, dated the Closing Date, to the effect that:

            (i) the Company and each of its subsidiaries has been duly
      incorporated, is validly existing as a corporation in good standing under
      the laws of Panama, has all requisite power and authority to own its
      property and to conduct its business as described in the Time of Sale
      Prospectus and is duly qualified to transact business and is in good
      standing in each jurisdiction in which the conduct of its business or its
      ownership or leasing of property requires such qualification, except to
      the extent that the failure to be so qualified or be in good standing
      would not have a material adverse effect on the Company and its
      subsidiaries, taken as a whole;

            (ii) the authorized capital stock of the Company conforms as to
      legal matters to the description thereof contained in each of the Time of
      Sale Prospectus and the Prospectus;

            (iii) the issued shares of Common Stock (including the Shares to be
      sold by the Selling Shareholders) have been duly and validly authorized
      and issued and are fully paid and non-assessable;

            (iv) all of the issued shares of capital stock of each subsidiary of
      the Company have been duly and validly authorized and issued, are fully
      paid and non-assessable and are owned directly by the Company (with the
      exception of the minority interests therein, as described in the
      Prospectus), free and clear of all liens, encumbrances, equities or
      claims;

            (v) CIASA owns, and on the Closing Date will own, the Shares to be
      sold by it free and clear of all security interests, claims, liens,
      equities or other encumbrances and has, and on the Closing Date will have,
      the legal right and power, and all authorizations and approvals required
      by law, to enter into this Agreement and to sell, transfer and deliver the
      Shares to be sold by it;

            (vi) this Agreement has been duly authorized, executed and delivered
      by each of the Company, Copa Airlines and CIASA;

                                       16


            (vii) assuming this Agreement has been duly authorized, executed and
      delivered by each of the other parties thereto, this Agreement is a valid
      and binding obligation of each of the Company, Copa Airlines and CIASA,
      enforceable against the Company, Copa Airlines and CIASA in accordance
      with its terms;

            (viii) the execution and delivery by each of the Company, Copa
      Airlines and CIASA of, and the performance by each of the Company, Copa
      Airlines and CIASA of its respective obligations under, this Agreement
      will not contravene any provision of applicable law or the Pacto Social
      (Articles of Incorporation) of the Company, Copa Airlines or CIASA or, to
      the best of such counsel's knowledge, any agreement or other instrument
      binding upon any of the Company, any subsidiaries or CIASA that is
      material to any of the Company and its subsidiaries, taken as a whole, or
      CIASA, or, to the best of such counsel's knowledge, any judgment, order or
      decree of any governmental body, agency or court having jurisdiction over
      the Company, any subsidiary, or CIASA;

            (ix) no consent, approval, authorization or order of, or
      qualification with, any governmental body or agency is required for the
      performance by any of the Company, Copa Airlines or CIASA of its
      respective obligations under this Agreement, except such as may be
      required by the securities or Blue Sky laws of the various states in
      connection with the offer and sale of the Shares;

            (x) the statements relating to Panamanian legal matters, documents
      or proceedings included in (A) the Time of Sale Prospectus and the
      Prospectus under the captions "Business -- Litigation," "Regulation --
      Panama," "Description of Capital Stock," "Certain Income Tax Consequences
      -- Other Panamanian Taxes" and "Underwriting" and (B) the Registration
      Statement in Items 6 and 7, in each case fairly summarize in all material
      respects such matters, documents or proceedings;

            (xi) to the best of such counsel's knowledge, after due inquiry,
      there are no actions, suits or proceedings by or before any arbitrator or
      governmental body pending or threatened against or affecting the Company
      or any of its subsidiaries which, if adversely determined, could
      reasonably be expected to, individually or in the aggregate, have a
      material adverse effect on the Company and its subsidiaries, taken as a
      whole, except as described in the Time of Sale Prospectus;

            (xii) upon payment to the Selling Shareholders for the Shares to be
      sold to the Underwriters by the Selling Shareholders, pursuant to this
      Agreement, all right, title and interest in the Shares will be transferred
      to the Underwriters free and clear of all security interests, claims,
      liens, equities or other encumbrances;

            (xiii) Copa Airlines possesses the governmental licenses necessary
      to conduct its commercial airline operations as described in the
      Prospectus under the caption "Regulations," and Copa Airlines is in
      compliance with the terms and conditions of all such governmental
      licenses, except where the failure to so comply would not, singly or in
      the aggregate, have a material adverse effect on either the Company or
      Copa Airlines;

                                       17


      and all of the governmental licenses are valid and in full force and
      effect, except where the invalidity of such governmental licenses or the
      failure of such governmental licenses to be in full force and effect would
      not, singly or in the aggregate, have a material adverse effect on either
      the Company or Copa Airlines, in all cases except as disclosed in the Time
      of Sale Prospectus; and

            (xiv) nothing has come to the attention of such counsel that causes
      such counsel to believe that (A) the Registration Statement or the
      Prospectus included therein (except for the financial statements and
      financial schedules and other financial data included therein, as to which
      such counsel need not express any belief) at the time the Registration
      Statement became effective contained any untrue statement of a material
      fact or omitted to state a material fact required to be stated therein or
      necessary to make the statements therein not misleading, (B) the Time of
      Sale Prospectus (except for the financial statements and financial
      schedules and other financial data included therein, as to which such
      counsel need not express any belief) as of the date of this Agreement or
      as amended or supplemented, if applicable, as of the Closing Date
      contained or contains any untrue statement of a material fact or omitted
      or omits 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 or (C) the Prospectus (except for the financial
      statements and financial schedules and other financial data included
      therein, as to which such counsel need not express any belief) as of its
      date or as amended or supplemented, if applicable, as of the Closing Date
      contained or contains any untrue statement of a material fact or omitted
      or omits 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.

      (d) The Underwriters shall have received on the Closing Date an opinion of
Simpson Thacher & Bartlett LLP, outside United States counsel for the Company
and Copa Airlines, dated the Closing Date, to the effect that:

            (i) this Agreement has been duly executed and delivered by each of
      the Company and Copa Airlines under the law of the State of New York;

            (ii) assuming this Agreement has been duly authorized by the each of
      the Company and Copa Airlines and duly authorized, executed and delivered
      by each of the other parties thereto, this Agreement is a valid and
      binding obligation of the Company and Copa Airlines, enforceable against
      each of the Company and Copa Airlines in accordance with its terms,
      subject to (i) the effects of bankruptcy, insolvency, fraudulent
      conveyance, reorganization, moratorium and other similar laws relating to
      or affecting creditors' rights generally, (ii) general equitable
      principles (whether considered in a proceeding in equity or at law), (iii)
      an implied covenant of good faith and fair dealing and (iv) the effects of
      the possible judicial application of foreign laws or foreign governmental
      or judicial action affecting creditors' rights;

            (iii) the execution and delivery by each of the Company and Copa
      Airlines and the performance by each of the Company and Copa Airlines of
      its obligations under this

                                       18


      Agreement will not violate any U.S. federal or New York statute or any
      rule or regulation that has been issued pursuant to any U.S. federal or
      New York statute and will not breach the terms of any agreement identified
      on a schedule to such opinion;

            (iv) no consent, approval, registration or qualification of or with
      any U.S. federal or New York governmental agency is required for the
      performance by either the Company or Copa Airlines of its obligations
      under this Agreement, except for the registration under the Securities Act
      and the Exchange Act of the Shares, and such consents, approvals,
      registrations or qualifications as may be required under state securities
      or Blue Sky laws in connection with the purchase and distribution of the
      Shares by the Underwriters;

            (v) the statements made in the Time of Sale Prospectus and the
      Prospectus under the caption "Income Tax Consequences--United States,"
      insofar as they purport to constitute summaries of matters of U.S. federal
      tax law and regulations or legal conclusions with respect thereto,
      constitute accurate summaries of the matters described therein in all
      material respects;

            (vi) neither the Company nor Copa Airlines is, and after giving
      effect to the offering and sale of the Shares and the application of the
      proceeds thereof as described in the Prospectus neither will be, required
      to register as an investment company, under the Investment Company Act of
      1940, as amended;

            (vii) under the laws of the State of New York relating to submission
      to personal jurisdiction, each of the Company and Copa Airlines has,
      pursuant to Section 16 of this Agreement, submitted to the personal
      jurisdiction of the courts of the State of New York and of the United
      States sitting in the Borough of Manhattan in any action arising out of or
      relating to this Agreement, has to the fullest extent permitted by law
      waived any objection to the venue of a proceeding in any such court, and
      has appointed CT Corporation as its authorized agent for the purpose
      described in Section 16 hereof, and service of process effected on such
      agent in the manner set forth in Section 16 hereof will be effective to
      confer valid personal jurisdiction over the Company in any such action;
      and

            (viii) (A) such counsel advises that the Registration Statement, as
      of its effective date, and the Prospectus, as of its date (except for the
      financial statements and financial schedules and other financial data
      contained therein or omitted therefrom, as to which such counsel need not
      express any opinion) appear on their face to be appropriately responsive
      in all material respects to the requirements of the Securities Act and the
      applicable rules and regulations of the Commission thereunder, and (B)
      nothing has come to the attention of such counsel that causes such counsel
      to believe that (1) the Registration Statement (except for the financial
      statements and financial schedules and other financial data contained
      therein or omitted therefrom, as to which such counsel need not express
      any belief) at the time the Registration Statement became effective
      contained any untrue statement of a material fact

                                       19


      or omitted to state a material fact required to be stated therein or
      necessary to make the statements therein not misleading, (2) the Time of
      Sale Prospectus (except for the financial statements and financial
      schedules and other financial data contained therein or omitted therefrom,
      as to which such counsel need not express any belief) as of the date of
      this Agreement or as amended or supplemented, if applicable, as of the
      Closing Date contained or contains any untrue statement of a material fact
      or omitted or omits 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 or (3) the Prospectus (except for the financial
      statements and financial schedules and other financial data contained
      therein or omitted therefrom, as to which such counsel need not express
      any belief) as of its date or as amended or supplemented, if applicable,
      of the Closing Date contained or contains any untrue statement of a
      material fact or omitted or omits 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.

      (e) The Underwriters shall have received on the Closing Date an opinion of
Simpson Thacher & Bartlett LLP, United States counsel for CIASA, dated the
Closing Date, to the effect that:

            (i) this Agreement has been duly executed and delivered by CIASA
      under the laws of the State of New York;

            (ii) assuming this Agreement has been duly authorized by CIASA and
      duly authorized, executed and delivered by each of the other parties
      thereto, this Agreement is a valid and binding obligation of CIASA,
      enforceable against CIASA in accordance with its terms, subject to (i) the
      effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
      moratorium and other similar laws relating to or affecting creditors'
      rights generally, (ii) general equitable principles (whether considered in
      a proceeding in equity or at law), (iii) an implied covenant of good faith
      and fair dealing and (iv) the effects of the possible judicial application
      of foreign laws or foreign governmental or judicial action affecting
      creditors' rights;

            (iii) the execution and delivery by CIASA and the performance by
      CIASA of its obligations under this Agreement will not violate any U.S.
      federal or New York statute or any rule or regulation that has been issued
      pursuant to any U.S. federal or New York statute and will not breach the
      terms of any agreement identified on a schedule to such opinion;

            (iv) no consent, approval, registration or qualification of or with
      any U.S. federal or New York governmental agency is required for the
      performance by CIASA of its obligations under this Agreement, except for
      the registration under the Securities Act and the Exchange Act of the
      Shares, and such consents, approvals, authorizations, registrations or
      qualifications as may be required under state securities or Blue Sky laws
      in connection with the purchase and distribution of the Shares by the
      Underwriters; and

                                       20


            (v) assuming CIASA has full power, right and authority to sell the
      Shares to be sold by CIASA, upon the payment and transfer contemplated by
      the Underwriting Agreement, the Underwriters will acquire a security
      entitlement with respect to the Shares and no action based on an adverse
      claim to such Shares may be asserted against the Underwriters. In giving
      this opinion, counsel for CIASA may assume that when such payment,
      delivery and crediting occur, (w) such Shares will have been registered in
      the name of Cede or another nominee as may be designated by DTC, in each
      case on the Company's share registry in accordance with its certificate of
      incorporation, bylaws and applicable law, (x) neither DTC nor any
      Underwriter has notice of any adverse claim within the meaning of Section
      8-105 of the UCC to such Shares, (y) DTC will be registered as a "clearing
      corporation" within the meaning of Section 8-102 of the UCC and (z)
      appropriate entries to the accounts of the several Underwriters on the
      records of DTC will have been made pursuant to the UCC; and

            (vi) under the laws of the State of New York relating to submission
      to jurisdiction, CIASA has, pursuant to Section 16 of this Agreement,
      submitted to the personal jurisdiction of the courts of the State of New
      York and of the United States sitting in the Borough of Manhattan in any
      action arising out of or relating to this Agreement, has to the fullest
      extent permitted by law waived any objection to the venue of a proceeding
      in any such court, and has appointed CT Corporation as its authorized
      agent for the purpose described in Section 16 hereof, and service of
      process effected on such agent in the manner set forth in Section 16
      hereof will be effective to confer valid personal jurisdiction over CIASA
      in any such action; the waiver by each Selling Shareholder pursuant to
      Section 16 hereof of any immunity to jurisdiction to which they may
      otherwise be entitled (including sovereign immunity and immunity from
      pre-judgment attachment, post-judgment attachment and execution) is legal,
      valid and binding under New York and federal law.

      (f) The Underwriters shall have received on the Closing Date an opinion of
Vinson & Elkins LLP, counsel for Continental, dated the Closing Date, to the
effect that:

            (i) assuming this Agreement has been duly authorized, executed and
      delivered by each of the parties thereto, this Agreement is a valid and
      binding obligation of Continental, enforceable against Continental in
      accordance with its terms subject to (i) the effects of bankruptcy,
      insolvency, fraudulent conveyance, reorganization, moratorium and other
      similar laws relating to or affecting creditors' rights generally, (ii)
      general equitable principles (whether considered in a proceeding in equity
      or at law) and (iii) an implied covenant of good faith and fair dealing;

            (ii) the execution and delivery by Continental of, and the
      performance by Continental of its obligations under, this Agreement will
      not violate any U.S. federal or New York statute or any rule or regulation
      that has been issued pursuant to any U.S. federal or New York statute
      except for any violation that would not have a material adverse effect on
      Continental's performance of its obligations under this Agreement;

                                       21


            (iii) no consent, approval, registration or qualification of or with
      any U.S. federal or New York governmental agency is required for the
      performance by Continental with its obligations under this Agreement,
      except for the registration under the Securities Act and the Exchange Act
      of the Shares, and such consents, approvals, authorizations, registrations
      or qualifications as may be required under state securities or Blue Sky
      laws in connection with the purchase and distribution of the Shares by the
      Underwriters except for any violation that would not have a material
      adverse effect on Continental's performance of its obligations under this
      Agreement; and

            (iv) assuming Continental has full power, right and authority to
      sell the Shares to be sold by Continental upon the payment and transfer
      contemplated by the Underwriting Agreement, the Underwriters will acquire
      a security entitlement with respect to the Shares sold by Continental and
      no action based on an adverse claim may be asserted against the
      Underwriters.

      (g) The Underwriters shall have received on the Closing Date an opinion of
in-house counsel for the Company and Copa Airlines, dated the Closing Date, to
the effect that:

            (i) there are no actions, suits or proceedings by or before any
      arbitrator or governmental body pending or threatened against or affecting
      the Company or any of its subsidiaries which, if adversely determined,
      could reasonably be expected to, individually or in the aggregate, have a
      material adverse effect on the Company and its subsidiaries, taken as a
      whole, except as described in the Time of Sale Prospectus; and

            (ii) Copa Airlines possesses the governmental licenses necessary to
      conduct its commercial airline operations as described in the Prospectus
      under the caption "Regulations," and Copa Airlines is in compliance with
      the terms and conditions of all such governmental licenses, except where
      the failure to so comply would not, singly or in the aggregate, have a
      material adverse effect on either the Company or Copa Airlines; and all of
      the governmental licenses are valid and in full force and effect, except
      where the invalidity of such governmental licenses or the failure of such
      governmental licenses to be in full force and effect would not, singly or
      in the aggregate, have a material adverse effect on either the Company or
      Copa Airlines, in all cases except as disclosed in the Time of Sale
      Prospectus.

      (h) The Underwriters shall have received on the Closing Date an opinion of
Jennifer Vogel, Senior Vice-President and General Counsel for Continental, dated
the Closing Date, to the effect that:

            (i) this Agreement has been duly authorized by Continental and has
      been duly executed and delivered by Continental

            (ii) the execution and delivery by Continental of, and the
      performance by Continental of its obligations under, this Agreement will
      not contravene any provision of the organizational documents of
      Continental or any agreement or other instrument

                                       22


      binding upon Continental or any judgment, order or decree of any
      governmental body, agency or court having jurisdiction over Continental
      except for any violation that would not be reasonably expected to have a
      material adverse effect on Continental's performance of its obligations
      under this Agreement;

            (iii) no consent, approval, authorization or order of, or
      qualification with, any governmental body or agency is required for the
      performance by Continental of its obligations under this Agreement, except
      such as may be required by the securities or Blue Sky laws of the States
      of the United States or securities laws of other jurisdictions in
      connection with the offer and sale of the Shares (as to which such counsel
      expresses no comment or opinion) or have been obtained or effected under
      the Securities Act or Exchange Act or in connection with the listing of
      the Shares on the NYSE or the failure of which to be obtained would not
      reasonably be expected to have a material adverse effect on Continental's
      performance of its obligations under this Agreement; and

            (v) Continental owns, and on the Closing Date will own, the Shares
      to be sold by it free and clear of all security interests, claims, liens,
      equities or other encumbrances and has, and on the Closing Date will have,
      the legal right and corporate power, and all authorizations and approvals
      required by law, to enter into this Agreement and to sell, transfer and
      deliver the Shares to be sold by it.

      (i) The Underwriters shall have received on the Closing Date an opinion of
Arias, Fabrega & Fabrega, Panamanian counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in Sections 7(c)(iv), 7(c)(vi),
7(c)(x) (but only as to the statements in each of the Time of Sale Prospectus
and the Prospectus under "Description of Capital Stock" and "Underwriting") and
7(c)(xiv) above.

      (j) The Underwriters shall have received on the Closing Date an opinion of
Cleary Gottlieb Steen & Hamilton LLP, counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in Sections 7(c)(x) (but only as
to the statements in the Prospectus under "Underwriting") and letter covering
the matters referred to in 7(d)(viii) above.

      (k) With respect to Section 7(c)(xiv) above, Galindo, Arias & Lopez and
Arias, Fabrega & Fabrega, with respect to Section 7(d)(viii) above, Simpson
Thacher & Bartlett LLP, Vinson & Elkins LLP and Cleary Gottlieb Steen & Hamilton
LLP may state that their opinions and beliefs are based upon their participation
in the preparation of the Registration Statement, Time of Sale Prospectus and
Prospectus and any amendments or supplements thereto and review and discussion
of the contents thereof, but are without independent check or verification,
except as specified. With respect to Sections 7(d) and 7(e) above, Simpson
Thacher & Bartlett LLP may rely upon with respect to factual matters and to the
extent such counsel deems appropriate, upon the representations of the parties
hereto contained herein and in other documents and instruments. With respect to
Section 7(f) above, Vinson & Elkins LLP may rely upon opinion or opinions of
in-house counsel for Continental and, with respect to factual matters and to the
extent such counsel deems appropriate, upon the representations of the parties
hereto contained herein and in other documents and instruments.

                                       23

         (l) The opinions of Galindo, Arias & Lopez, Simpson Thacher & Bartlett
LLP and Vinson & Elkins LLP described in Sections 7(c), 7(d), 7(e) and 7(f)
above shall be rendered to the Underwriters at the request of the Company or one
or more of the Selling Shareholders, as the case may be, and shall so state
therein.

         (m) The Underwriters shall have received, on each of the date hereof
and the Closing Date, a letter dated the date hereof or the Closing Date, as the
case may be, in form and substance satisfactory to the Underwriters, from Ernst
& Young independent public accountants, containing statements and information of
the type ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial information
contained in the Registration Statement, the Time of Sale Prospectus and the
Prospectus; provided that the letter delivered on the Closing Date shall use a
"cut-off date" not earlier than the date hereof.

         (n) The "lock-up" agreements, each substantially in the form of Exhibit
A hereto, between you and certain shareholders, officers and directors of the
Company relating to sales and certain other dispositions of shares of Common
Stock or certain other securities, delivered to you on or before the date
hereof, shall be in full force and effect on the Closing Date.

         (o) The Shares shall have been approved for listing on the NYSE,
subject only to official notice of issuance.

         The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the delivery to you on the applicable Option
Closing Date of such documents as you may reasonably request with respect to the
good standing of the Company, the due authorization and issuance of the
Additional Shares to be sold on such Option Closing Date and other matters
related to the issuance of such Additional Shares.

         8. Covenants of the Company. The Company covenants with each
Underwriter as follows:

         (a) To furnish to you, without charge, six signed copies of the
Registration Statement (including exhibits thereto) and for delivery to each
other Underwriter a conformed copy of the Registration Statement (without
exhibits thereto) and to furnish to you in New York City, without charge, prior
to 4:00 p.m. New York City time on the business day next succeeding the date of
this Agreement and during the period mentioned in Section 8(e) or 8(f) below, as
many copies of the Time of Sale Prospectus, the Prospectus and any supplements
and amendments thereto or to the Registration Statement as you may reasonably
request.

         (b) Before amending or supplementing the Registration Statement, the
Time of Sale Prospectus or the Prospectus, to furnish to you a copy of each such
proposed amendment or supplement and to make such modifications as you may
reasonably suggest, and file with the Commission within the applicable period
specified in Rule 424(b) under the Securities Act any prospectus required to be
filed pursuant to such Rule.


                                       24


         (c) To furnish to you a copy of each proposed free writing prospectus
to be prepared by or on behalf of, used by, or referred to by the Company and
not to use or refer to any proposed free writing prospectus to which you
reasonably object.

         (d) Not to take any action that would result in an Underwriter or the
Company being required to file with the Commission pursuant to Rule 433(d) under
the Securities Act a free writing prospectus prepared by or on behalf of the
Underwriter that the Underwriter otherwise would not have been required to file
thereunder without the consent of such Underwriter and the Representatives.

         (e) If the Time of Sale Prospectus is being used to solicit offers to
buy the Shares at a time when the Prospectus is not yet available to prospective
purchasers and any event shall occur or condition exist as a result of which it
is necessary to amend or supplement the Time of Sale Prospectus in order to make
the statements therein, in the light of the circumstances, not misleading, or if
any event shall occur or condition exist as a result of which the Time of Sale
Prospectus conflicts with the information contained in the Registration
Statement then on file, or if, in the opinion of counsel for the Underwriters,
it is necessary to amend or supplement the Time of Sale Prospectus to comply
with applicable law, forthwith to prepare, file with the Commission and furnish,
at its own expense, to the Underwriters and to any dealer upon request, either
amendments or supplements to the Time of Sale Prospectus so that the statements
in the Time of Sale Prospectus as so amended or supplemented will not, in the
light of the circumstances when delivered to a prospective purchaser, be
misleading or so that the Time of Sale Prospectus, as amended or supplemented,
will no longer conflict with the Registration Statement, or so that the Time of
Sale Prospectus, as amended or supplemented, will comply with applicable law.

         (f) If, during such period after the first date of the public offering
of the Shares as in the opinion of counsel for the Underwriters the Prospectus
(or in lieu thereof the notice referred to in Rule 173(a) under the Securities
Act) is required by law to be delivered in connection with sales by an
Underwriter or dealer, any event shall occur or condition exist as a result of
which it is necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the Prospectus (or in
lieu thereof the notice referred to in Rule 173(a) under the Securities Act) is
delivered to a purchaser, not misleading, or if, in the opinion of counsel for
the Underwriters, it is necessary to amend or supplement the Prospectus to
comply with applicable law, forthwith to prepare, file with the Commission and
furnish, at its own expense, to the Underwriters and to the dealers (whose names
and addresses you will furnish to the Company) to which Shares may have been
sold by you on behalf of 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 (or in lieu thereof the notice referred to in
Rule 173(a) under the Securities Act) is delivered to a purchaser, be misleading
or so that the Prospectus, as amended or supplemented, will comply with law.

         (g) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request, provided that the Company shall


                                       25


not be obligated to file any general consent to service of process or to qualify
as a foreign corporation or as a dealer in securities in any jurisdiction in
which it is not so qualified or to subject itself to taxation in respect of
doing business in any jurisdiction in which it is not otherwise so subject.

         (h) To make generally available to the Company's security holders and
to you as soon as practicable an earning statement covering the twelve month
period ending December 31, 2006 that satisfies the provisions of Section 11(a)
of the Securities Act and the rules and regulations of the Commission
thereunder.

         (i) To use its best efforts to effect the listing of the Shares on the
NYSE, including the filing with the NYSE of all required documents and notices
for non-U.S. companies that have securities that are traded on the NYSE.

         (j) To file any documents or reports with respect to the Shares
required to be filed with the National Securities Commission of Panama (the
Comision Nacional de Valores) in the time period required for such filing.

         (k) To make available to the holders of the Shares and the
Representatives, (A) after the end of each fiscal year, an annual report (in
English) that will include a review of operations and annual audited
consolidated financial statements (including consolidated balance sheets,
statements of income, statements of change in shareholders' equity and
statements of cash flow) with an opinion by an independent accountant and
prepared in conformity with U.S. GAAP; and (B) after the end of each of the
first three quarterly periods of each fiscal year, unaudited consolidated
financial information prepared in accordance with U.S. GAAP, equivalent in
substance to the information that would be required to be filed on Form 10-Q, if
the Company were required to file quarterly reports on Form 10-Q.

         9. Expenses. Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company agrees to
pay or cause to be paid all expenses incident to the performance of their
obligations under this Agreement, including: (i) the fees, disbursements and
expenses of the Company's counsel, the Company's accountants and counsel for the
Selling Shareholders in connection with the registration and delivery of the
Shares under the Securities Act and all other fees or expenses in connection
with the preparation and filing of the Registration Statement, any preliminary
prospectus, the Time of Sale Prospectus, the Prospectus, any free writing
prospectus prepared by or on behalf of, used by, or referred to by the Company
and amendments and supplements to any of the foregoing, including all printing
costs associated therewith, and the mailing and delivering of copies thereof to
the Underwriters and dealers, in the quantities hereinabove specified, (ii) all
costs and expenses related to the transfer and delivery of the Shares to the
Underwriters, including any transfer or other taxes payable thereon, (iii) the
cost of printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the Shares under state securities laws and
all expenses in connection with the qualification of the Shares for offer and
sale under state securities laws as provided in Section 8(d) hereof, including
filing fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such


                                       26


qualification and in connection with the Blue Sky or Legal Investment
memorandum, (iv) all filing fees and the reasonable fees and disbursements of
counsel to the Underwriters incurred in connection with the review and
qualification of the offering of the Shares by the NASD, (v) all fees and
expenses in connection with the preparation and filing of the registration
statement on Form 8-A relating to the Common Stock and all costs and expenses
incident to listing the Shares on the NYSE, (vi) the cost of printing
certificates representing the Shares, (vii) the costs and charges of any
transfer agent, registrar or depositary, (viii) the costs and expenses of the
Company relating to investor presentations on any "road show" undertaken in
connection with the marketing of the offering of the Shares, including, without
limitation, expenses associated with the preparation or dissemination of any
electronic road show, expenses associated with the production of road show
slides and graphics, fees and expenses of any consultants engaged in connection
with the road show presentations with the prior approval of the Company, travel
and lodging expenses of the representatives and officers of the Company and any
such consultants, and the cost of any aircraft chartered in connection with the
road show, (ix) the document production charges and expenses associated with
printing this Agreement and (x) all other costs and expenses incident to the
performance of the obligations of the Company hereunder for which provision is
not otherwise made in this Section. It is understood, however, that except as
provided in Section 11 entitled "Indemnity and Contribution" and the last
paragraph of Section 12 below, the Underwriters will pay all of their costs and
expenses, including fees and disbursements of their counsel, stock transfer
taxes payable on resale of any of the Shares by them and any advertising
expenses connected with any offers they may make.

         The provisions of this Section shall not supersede or otherwise affect
any agreement that the Company and the Selling Shareholders may otherwise have
for the allocation of such expenses among themselves.

         10. Covenant of the Underwriters. Each Underwriter severally covenants
with the Company not to take any action that would result in the Company being
required to file with the Commission under Rule 433(d) a free writing prospectus
prepared by or on behalf of such Underwriter that otherwise would not be
required to be filed by the Company thereunder, but for the action of the
Underwriter and not to use or refer to any free writing prospectus without the
prior written consent of the Company.

         11. Indemnity and Contribution. (a) The Company and Copa Airlines,
jointly and severally, agree to indemnify and hold harmless each Underwriter,
each person, if any, who controls any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, and each
affiliate of any Underwriter within the meaning of Rule 405 under the Securities
Act from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
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, any preliminary
prospectus, the Time of Sale Prospectus, any "issuer free writing prospectus" as
defined in Rule 433(d) of the Securities Act relating to the Shares or any
"issuer information" filed or required to be filed pursuant to Rule 433(d) of
the Securities Act or the Prospectus or any amendment or supplement thereto, or
caused by any omission or alleged


                                       27


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 information
relating to any Underwriter furnished to the Company in writing by such
Underwriter, expressly for use therein.

         (b) Each Selling Shareholder agrees, severally and not jointly, to
indemnify and hold harmless each Underwriter, each person, if any, who controls
the Company, Copa Airlines or any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, and each
affiliate of any Underwriter within the meaning of Rule 405 under the Securities
Act from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
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, any preliminary
prospectus, the Time of Sale Prospectus, any "issuer free writing prospectus" as
defined in Rule 433(d) of the Securities Act relating to the Shares or any
"issuer information" filed or required to be filed pursuant to Rule 433(d) of
the Securities Act or the Prospectus or any amendment or supplement 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, but only with reference to information relating to such Selling
Shareholder furnished in writing to the Company by or on behalf of such selling
Shareholders expressly for use in the Registration Statement, any preliminary
prospectus, the Time of Sale Prospectus, any "issuer free writing prospectus" as
defined in Rule 433(d) of the Securities Act relating to the Shares or any
"issuer information" filed or required to be filed pursuant to Rule 433(d) of
the Securities Act or the Prospectus or any amendment or supplement thereto. The
liability of each Selling Shareholder under the indemnity agreement contained in
this paragraph shall be limited to an amount equal to the aggregate Public
Offering Price of the Shares sold by such Selling Shareholder under this
Agreement.

         (c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, the Selling Shareholders, the directors of the
Company, the officers of the Company who sign the Registration Statement and
each person, if any, who controls the Company or any Selling Shareholder 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 the Company to
such Underwriter, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter expressly
for use in the Registration Statement, any preliminary prospectus, the Time of
Sale Prospectus, any "issuer free writing prospectus" as defined in Rule 433(d)
of the Securities Act relating to the Shares or any "issuer information" filed
or required to be filed pursuant to Rule 433(d) of the Securities Act, the
Prospectus or any amendments or supplements thereto.

         (d) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 11(a), 11(b), or 11(c) such person (the "INDEMNIFIED
PARTY") shall promptly notify the person against whom such indemnity may be
sought (the "INDEMNIFYING PARTY") in writing, but the


                                       28


omission to so notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party, and the indemnifying
party, upon request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified party and any
others the indemnifying party may designate in such proceeding and shall pay the
fees and disbursements of such counsel related to such proceeding. 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 use of counsel chosen by the indemnifying
party to represent the indemnified party would present such counsel with a
actual or potential differing interest; (ii) the actual or potential defendants
in, or targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties that are different from or additional to those available to the
indemnifying party; (iii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of the institution of such action; or (iv) the
indemnifying party shall authorize in writing the indemnified party to employ
separate counsel at the expense of the indemnifying party. It is understood that
the indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for (i) the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Underwriters and all
persons, if any, who control any Underwriter within the meaning of either
Section 16 of the Securities Act or Section 20 of the Exchange Act or who are
affiliates of any Underwriter within the meaning of Rule 405 under the
Securities Act, (ii) the fees and expenses of more than one separate firm (in
addition to any local counsel) for the Company, its directors, its officers who
sign the Registration Statement and each person, if any, who controls the
Company within the meaning of either such Section, (iii) the fees and expenses
of more than one separate firm (in addition to any local counsel) for
Continental and all persons, if any, who control Continental within the meaning
of either such Section, and that all such fees and expenses shall be reimbursed
as they are incurred and (iv) the fees and expenses of more than one separate
firm (in addition to any local counsel) for CIASA and all persons, if any, who
control CIASA within the meaning of either such Section, and that all such fees
and expenses shall be reimbursed as they are incurred. In the case of any such
separate firm for the Underwriters and such control persons and affiliates of
any Underwriters, such firm shall be designated in writing by the
Representatives. In the case of any such separate firm for the Company, and such
directors, officers and control persons of the Company, such firm shall be
designated in writing by the Company. In the case of any such separate firm for
Continental and such control persons of Continental, such firm shall be
designated in writing by Continental. In the case of any such separate firm for
CIASA and such control persons of CIASA, such firm shall be designated in
writing by CIASA. The indemnifying party shall not be liable for any settlement
of any proceeding effected without its written consent, such consent not to be
unreasonably withheld, 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. No indemnifying party shall, 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


                                       29


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 any indemnified party.

         (e) To the extent the indemnification provided for in Section 11(a),
11(b) or 11(c) is unavailable to an indemnified party or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then each
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 indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand from the offering of the Shares
or (ii) if the allocation provided by clause 11(e)(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 11(e)(i) above but also the relative
fault of the indemnifying party or parties on the one hand and of the
indemnified party or parties 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 the Company and Selling Shareholders on the one hand and the
Underwriters on the other hand in connection with the offering of the Shares
shall be deemed to be in the same respective proportions as the net proceeds
from the offering of the Shares (before deducting expenses) received by each of
the Company and Selling Shareholders and the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table
on the cover of the Prospectus, bear to the aggregate Public Offering Price of
the Shares. The relative fault of the Company or the Selling Shareholders, as
the case may be, on the one hand and 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 information supplied by the Company or the Selling
Shareholders or by 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 11 are several in proportion to the respective number of Shares
they have purchased hereunder, and not joint. The liability of each Selling
Shareholder under the contribution agreement contained in this paragraph shall
be several and not joint, and shall be limited to an amount equal to the
aggregate Public Offering Price of the Shares sold by such Selling Shareholder
under this Agreement.

         (f) The Company, Copa Airlines, the Selling Shareholders and the
Underwriters agree that it would not be just or equitable if contribution
pursuant to this Section 11 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 Section 11(e). The amount paid or payable by an indemnified party
as a result of the losses, claims, damages and liabilities referred to in
Section 11(e) 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 11, no Underwriter shall be


                                       30


required to contribute any amount in excess of the amount by which the total
price at which the Shares 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 remedies provided for in this Section 11 are
not exclusive and shall not limit any rights or remedies that may otherwise be
available to any indemnified party at law or in equity.

         (g) The indemnity and contribution provisions contained in this Section
11 and the representations, warranties and other statements of the Company, Copa
Airlines and the Selling Shareholders 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, any
person controlling any Underwriter or any affiliate of any Underwriter, any
Selling Shareholder or any person controlling any Selling Shareholder, or the
Company, its officers or directors or any person controlling the Company and
(iii) acceptance of and payment for any of the Shares.

         12. Termination. The Underwriters may terminate this Agreement by
notice given by you to the Company, if after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on, or by, as the case may be, any of the NYSE,
the American Stock Exchange or the Nasdaq National Market (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over the counter market (iii) material disruption in securities settlement,
payment or clearance services in the United States or Panama shall have
occurred, (iv) a change or development involving a prospective change in
Panamanian taxation affecting the Company, the Shares or the transfer thereof
shall have occurred, which makes it, in your judgment, impracticable or
inadvisable to proceed with the offer, sale or delivery of the Shares on the
terms and in the manner contemplated in the Time of Sale Prospectus or the
Prospectus (v) any moratorium on commercial banking activities shall have been
declared by Federal, New York State or Panamanian authorities or (vi) there
shall have occurred any outbreak or escalation of hostilities, or any change in
financial, political or economic conditions or any calamity or crisis that, in
your judgment, is material and adverse and which, singly or together with any
other event specified in this clause (vi), makes it, in your judgment,
impracticable or inadvisable to proceed with the offer, sale or delivery of the
Shares on the terms and in the manner contemplated in the Time of Sale
Prospectus or the Prospectus.

         13. Effectiveness; Defaulting Underwriters. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.

         If, on the Closing Date or an Option Closing Date, as the case may be,
any one or more of the Underwriters shall fail or refuse to purchase Shares that
it has or they have agreed to purchase hereunder on such date, and the aggregate
number of Shares that such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters shall


                                       31


be obligated severally in the proportions that the number of Firm Shares set
forth opposite their respective names in Schedule I bears to the aggregate
number of Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase the
Shares that such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date; provided that in no event shall the number of
Shares that any Underwriter has agreed to purchase pursuant to this Agreement be
increased pursuant to this Section 13 by an amount in excess of one-ninth of
such number of Shares without the written consent of such Underwriter. If, on
the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Firm Shares and the aggregate number of Firm Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of Firm
Shares to be purchased on such date, and arrangements satisfactory to you, the
Company and the Selling Shareholders for the purchase of such Firm Shares are
not made within 36 hours after such default, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter, the Company or
the Selling Shareholders. In any such case either you, the Company or the
Selling Shareholders shall have the right to postpone the Closing Date, but in
no event for longer than seven days, in order that the required changes, if any,
in the Registration Statement, in the Time of Sale Prospectus, in the Prospectus
or in any other documents or arrangements may be effected. If, on an Option
Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase
Additional Shares and the aggregate number of Additional Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of
Additional Shares to be purchased on such Option Closing Date, the
non-defaulting Underwriters shall have the option to (i) terminate their
obligation hereunder to purchase the Additional Shares to be sold on such Option
Closing Date or (ii) purchase not less than the number of Additional Shares that
such non-defaulting Underwriters would have been obligated to purchase in the
absence of such default. Any action taken under this paragraph shall not relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.

         If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company or any
Selling Shareholder to comply with the terms or to fulfill any of the conditions
of this Agreement, or if for any reason the Company or any Selling Shareholder
shall be unable to perform its obligations under this Agreement, the Company or
any Selling Shareholder will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.

         14. Entire Agreement. (a) This Agreement, together with any
contemporaneous written agreements and any prior written agreements (to the
extent not superseded by this Agreement) that relate to the offering of the
Shares, represents the entire agreement between the Company and the Underwriters
with respect to the preparation of any preliminary prospectus, the Time of Sale
Prospectus, the Prospectus, the conduct of the offering, and the purchase and
sale of the Shares.

         (b) The Company acknowledges that in connection with the offering of
the Shares: (i) the Underwriters have acted at arms length, are not agents of,
and owe no fiduciary duties to, the


                                       32


Company or any other person, (ii) the Underwriters owe the Company only those
duties and obligations set forth in this Agreement and prior written agreements
(to the extent not superseded by this Agreement), if any, and (iii) the
Underwriters may have interests that differ from those of the Company. The
Company waives to the full extent permitted by applicable law any claims it may
have against the Underwriters arising from an alleged breach of fiduciary duty
in connection with the offering of the Shares.

         15. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

         16. Applicable Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York.

         17. Submission to Jurisdiction; Appointment of Agent for Service. (a)
Each of the Company and CIASA irrevocably submits to the non-exclusive
jurisdiction of the courts of the State of the New York and of the United States
sitting in the Borough of Manhattan over any suit, action or proceeding arising
out of or relating to this Agreement, the Prospectus, the Registration Statement
or the offering of the Shares. Each of the Company and CIASA irrevocably waives,
to the fullest extent permitted by law, any objection that it may now or
hereafter have to the laying of venue of any such suit, action or proceeding
brought in such a court and any claim that any such suit, action or proceeding
brought in such a court has been brought in an inconvenient forum. To the extent
that the Company or CIASA has or hereafter may acquire any immunity (on the
grounds of sovereignty or otherwise) from the jurisdiction of any court or from
any legal process with respect to itself or its property, the Company or CIASA,
as applicable, irrevocably waives, to the fullest extent permitted by law, such
immunity in respect of any such suit, action or proceeding.

         (b) Copa Airlines irrevocably submits to the non-exclusive jurisdiction
of the courts of the State of the New York and of the United States sitting in
the Borough of Manhattan over any suit, action or proceeding arising out of or
relating to this Agreement and irrevocably waives, to the fullest extent
permitted by law, any objection that it may now or hereafter have to the laying
of venue of any such suit, action or proceeding brought in such a court and any
claim that any such suit, action or proceeding brought in such a court has been
brought in an inconvenient forum. To the extent that Copa Airlines has or
hereafter may acquire any immunity (on the grounds of sovereignty or otherwise)
from the jurisdiction of any court or from any legal process with respect to
itself or its property, Copa Airlines irrevocably waives, to the fullest extent
permitted by law, such immunity in respect of any such suit, action or
proceeding.

         (c) Each of the Company, Copa Airlines and CIASA hereby irrevocably
appoints CT Corporation, with offices at 111 Eighth Ave., New York, New York
10011 as its agent for service of process in any suit, action or proceeding
described in the preceding paragraph and agrees that service of process in any
such suit, action or proceeding may be made upon it at the office of such agent.
Each of the Company, Copa Airlines and CIASA waives, to the fullest extent
permitted by law, any other requirements of or objections to personal
jurisdiction with


                                       33


respect thereto. Each of the Company, Copa Airlines and CIASA represents and
warrants that such agent has agreed to act as the Company's, Copa Airlines' and
CIASA's agent for service of process, and each of the Company, Copa Airlines and
CIASA agrees to take any and all action, including the filing of any and all
documents and instruments, that may be necessary to continue such appointment in
full force and effect.

         18. Taxes. All payments to be made by the Company, Copa Airlines and
the Selling Shareholders under this Agreement shall be paid free and clear of
and without deduction or withholding for or on account of, any present or future
taxes, levies or imposts by Panama or by any department, agency or other
political subdivision or taxing authority thereof or therein, and all interest,
penalties or similar liabilities with respect thereto (collectively, "TAXES").
If any Taxes are required by law to be deducted or withheld in connection with
such payments, the Company, Copa Airlines and the Selling Shareholders will
increase the amount paid so that the net amount received by the Underwriters
equals the amount that would have been received in the absence of such deduction
or withholding.

         19. No Fiduciary Duty. Each of the Company and the Selling Shareholders
acknowledges that in connection with the offering of the Shares: (a) the
Underwriters have acted at arms length, are not agents of, and owe no fiduciary
duties to, the Company, the Selling Shareholders or any other person, (b) the
Underwriters owe the Company and the Selling Shareholders only those duties and
obligations set forth in this Agreement and (c) the Underwriters may have
interests that differ from those of the Company and the Selling Shareholders.
Each of the Company and the Selling Shareholders waives to the full extent
permitted by applicable law any claims it may have against the Underwriters
arising from an alleged breach of fiduciary duty in connection with the offering
of the Shares.

         20. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.

         21. Notices. All communications hereunder shall be in writing and
effective only upon receipt and if to the Underwriters shall be delivered,
mailed or sent to you in care of the Representatives: Morgan Stanley & Co.
Incorporated, 1585 Broadway, New York, New York 10036, Attention: Equity
Syndicate Desk, with a copy to the Legal Department and Goldman, Sachs & Co.,
One New York Plaza, New York, New York 10004, Attention: Registration
Department, Fax: (212) 902-3000; if to the Company shall be delivered, mailed or
sent to Avenida Principal y Avenida de la Rotonda, Costa del Este, Complejo
Business Park, Torre Norte, Parque Lefevre, Panama City, Panama, Attention Pedro
Heilbron, Fax: 507-227-1952; if to CIASA shall be delivered, mailed or sent to
Attention Stanley Motta, care of the Company, and if to Continental shall be
delivered, mailed or sent to 1600 Smith Street, Houston, Texas 77002, Attention
Mark Erwin, Fax: [-] with a copy to General Counsel.

                                       34















                                   Very truly yours,

                                   Copa Holdings, S.A.


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


                                   Compania Panamena de Aviacion, S.A


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


                                       35




                                   The Selling Shareholders named in Schedule II
                                     hereto, acting severally


                                     By:            Corporacion de Inversiones
                                                    Aereas, S.A.


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


                                     By:             Continental Airlines, Inc.


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


                                       36


Accepted as of the date hereof

Morgan Stanley & Co. Incorporated
Goldman, Sachs & Co.

Acting severally on behalf of themselves and the several
     Underwriters named in Schedule I hereto


By:             Morgan Stanley & Co. Incorporated


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


By:             Goldman, Sachs & Co.


By:
                ---------------------------------------
                (Goldman, Sachs & Co.)


                                       37


                                                                      SCHEDULE I




                                                     NUMBER OF FIRM SHARES TO BE
         UNDERWRITER                                          PURCHASED
         -----------                                          ---------
                                                  
Morgan Stanley & Co. Incorporated
Goldman, Sachs & Co.
Citigroup Global Markets Inc.
J.P. Morgan Securities Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated

                                                     ---------------------------
         Total:
                                                     ===========================



                                      I-1


                                                                     SCHEDULE II



                                                   NUMBER OF FIRM SHARES
       SELLING SHAREHOLDERS                              TO BE SOLD
       --------------------                              ----------
                                                
Corporacion de Inversiones Aereas, S.A.                  7,000,000
Continental Airlines, Inc.                               7,000,000
                                                         ---------
         Total:                                         14,000,000
                                                        ==========



                                      II-1


                                                                    SCHEDULE III


                             TIME OF SALE PROSPECTUS

1.  Preliminary Prospectus issued November 28, 2005


2. Free Writing Prospectuses: None


                                      II-2


                                                                       EXHIBIT A

                            [FORM OF LOCK-UP LETTER]

                                                     ____________, 2005

Morgan Stanley & Co. Incorporated
     1585 Broadway
     New York, New York 10036

Goldman, Sachs & Co.
     One New York Plaza
     New York, New York 10004

Dear Ladies and Gentlemen:

         The undersigned understands that Morgan Stanley & Co. Incorporated
("MORGAN STANLEY") and Goldman, Sachs & Co. ("GOLDMAN SACHS" and, together with
Morgan Stanley, the "REPRESENTATIVES") propose to enter into an Underwriting
Agreement (the "UNDERWRITING AGREEMENT") with Copa Holdings, S.A. a Panamanian
corporation (the "COMPANY"), providing for the public offering (the "PUBLIC
OFFERING") by the several Underwriters, including Morgan Stanley and Goldman
Sachs (the "UNDERWRITERS") as the representatives (the "REPRESENTATIVES") of the
several Underwriters, of ___ shares (the "SHARES") of Class A Common Stock,
without par value, of the Company (the "COMMON STOCK").

         To induce the Underwriters that may participate in the Public Offering
to continue their efforts in connection with the Public Offering, the
undersigned hereby agrees that, without the prior written consent of the
Representatives on behalf of the Underwriters, it will not, during the period
commencing on the date hereof and ending 180 days after the date of the final
prospectus relating to the Public Offering (the "PROSPECTUS"), (1) offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock, or (2) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of the Common Stock, whether any such transaction described in
clause (1) or (2) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (a) transactions relating to shares of Common Stock or other securities
acquired in open market transactions after the completion of the Public
Offering, provided that no filing under Section 16(a) of the Exchange Act shall
be required or shall be voluntarily made in connection with subsequent sales of
Common Stock or other securities acquired in such open market transactions and
(ii) no filing under Section 16(a) of the Exchange Act, reporting a reduction in
beneficial ownership of shares of Common Stock, shall be required or shall be
voluntarily made


                                      A-1

during the restricted period referred to in the foregoing sentence. In
addition, the undersigned agrees that, without the prior written consent of the
Representatives on behalf of the Underwriters, it will not, during the period
commencing on the date hereof and ending 180 days after the date of the
Prospectus, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock. The undersigned also agrees and
consents to the entry of stop transfer instructions with the Company's transfer
agent and registrar against the transfer of the undersigned's shares of Common
Stock except in compliance with the foregoing restrictions.

         If:

         (1) during the last 17 days of the 180-day restricted period the
Company issues an earnings release or material news or a material event relating
to the Company occurs; or

         (2) prior to the expiration of the 180-day restricted period, the
Company announces that it will release earnings results during the 16-day period
beginning on the last day of the 180-day period;

the restrictions imposed by this agreement shall continue to apply until the
expiration of the 18-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event.

         The undersigned shall not engage in any transaction that may be
restricted by this agreement during the 34-day period beginning on the last day
of the initial 180-day restricted period unless the undersigned requests and
receives prior written confirmation from the Company or the Representatives on
behalf of the Underwriters that the restrictions imposed by this agreement have
expired.

         The undersigned understands that the Company and the Underwriters are
relying upon this agreement in proceeding toward consummation of the Public
Offering. The undersigned further understands that this agreement is irrevocable
and shall be binding upon the undersigned's heirs, legal representatives,
successors and assigns.


                                      A-2


         Whether or not the Public Offering actually occurs depends on a number
of factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.



                                Very truly yours,


                                ------------------------------------------------
                                (Name)

                                ------------------------------------------------
                                (Address)


                                      A-3

                                                                     EXHIBIT 5.1

                      [GALINDO, ARIAS & LOPEZ LETTERHEAD]


                                                               November 28, 2005

Copa Holdings, S.A.
Ave. Aquilino de la Guardia y Calle 50
Torre Banco Continental
Panama City, Republic of Panama

       RE: LEGAL OPINION REGARDING THE VALIDITY OF THE SHARES ISSUED BY
           COPA HOLDINGS, S.A.

Ladies and Gentlemen:

        We act as Panamanian counsel for Copa Holdings, S.A. (the "Company"),
a corporation duly organized and existing under the laws of Panama, in
connection with the offer and proposed sale of the Company's Class A Common
Stock, without par value, of which 14,000,000 shares will be sold by each of
Continental Airlines and Compania Panamena de Aviacion, S.A. (Copa), in
accordance with the Underwriting Agreement to be entered into among the
Company, the Selling Shareholders and a group of underwriters represented by
Morgan Stanley & Co. Incorporated and Goldman, Sachs & Co. (the
"Representatives"). An additional 2,100,000 shares may be sold by the
Company in connection with the over-allotment option, as contemplated by
the Company's Registration Statement on Form F-1 (No.333-129967), filed with
the SEC on November 28, 2005 (as amended, the "Registration Statement.")
Except as otherwise defined herein, capitalized terms used herein shall have
the meanings set forth in the Underwriting Agreement.

     We have examined originals or copies, certified or otherwise identified
to our satisfaction, of the Registration Statement, the Prospectus, the Articles
of Incorporation, the power of attorney and other such documents, corporate
records and other instruments as we have deemed necessary or advisable for the
purpose of rendering this opinion.  We have assumed the genuineness of all
signatures and the authenticity of all documents submitted to us as originals
and the conformity to original documents of all documents submitted to us as
copies or facsimiles.

     Based upon the foregoing, we are of the opinion that the Company's
Class A shares are duly and validly authorized, legally issued, fully paid
and non-assessable.

     We are qualified to practice law in the Republic of Panama and
accordingly, express no legal opinion herein based upon any other laws other
than the laws of Panama.

     We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and to the reference to us under the captions
"Validity of Securities" and "Enforcement of Civil Liabilities" in the
Prospectus constituting a part of the Registration Statement.

                                        Yours Very Truly,

                                        GALINDO, ARIAS & LOPEZ



                                        Ramon Ricardo Arias

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

                                                                   Exhibit 10.18

                                  EMBRAER 190LR

                         PURCHASE AGREEMENT DCT-006/2003

                                     BETWEEN

                          EMBRAER - EMPRESA BRASILEIRA
                               DE AERONAUTICA S.A.

                                       AND

                         REGIONAL AIRCRAFT HOLDINGS LTD.



                                      INDEX



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


                                     Page 1



                                   ATTACHMENTS

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

                                     Page 2



                         PURCHASE AGREEMENT DCT-006/2003

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

THE SALE COVERED BY THIS AGREEMENT SHALL BE GOVERNED SOLELY BY THE TERMS AND
CONDITIONS HEREIN SET FORTH, AS WELL AS BY THE PROVISIONS SET FORTH IN THE
ATTACHMENTS HERETO.

THIS AGREEMENT SHALL NOT BE EFFECTIVE UNLESS AND UNTIL IT IS SIGNED BY AN
AUTHORIZED OFFICER OF REGIONAL AIRCRAFT HOLDINGS LTD. AND EXECUTED BY TWO
AUTHORIZED OFFICERS OF EMBRAER - EMPRESA BRASILEIRA DE AERONAUTICA S.A.

1.    DEFINITIONS

      For the purpose of this Agreement, the following definitions are hereby
      adopted by the Parties and, unless otherwise expressly provided, the
      singular includes the plural, the masculine includes the feminine and
      neutral genders:

1.1  "Actual Delivery Date"   shall mean, with respect to each Aircraft, the
                              date on which Buyer obtains title to that Aircraft
                              in accordance with Article 7.

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

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

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

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

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

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

                                     Page 3



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

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

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

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

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

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

1.13 "Embraer"                shall mean Embraer - Empresa Brasileira de
                              Aeronautica S.A., a Brazilian corporation with its
                              principal place of business at Av. Brigadeiro
                              Faria Lima, 2170 - Putim, Sao Jose dos Campos, Sao
                              Paulo, Brazil.

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

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

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

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

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

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

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

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

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

                                     Page 4



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

1.23 "Parties"                shall mean Embraer and Buyer.

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

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

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

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

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

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

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

2.    SUBJECT

     Subject to the terms and conditions of this Agreement:

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

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

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

3.    PRICE

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

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

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

                                     Page 5



      Delivery Date.

4.    PAYMENT

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

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

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

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

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

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

4.2   Late Payments:

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

4.3   Termination for failure to make payments:

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

4.4   Net payments:

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

                                     Page 6



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

4.5   Payment Date

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

5.    DELIVERY

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

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

5.2 **Material Redacted**

6.    CERTIFICATION

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

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

                                     Page 7



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

7.    ACCEPTANCE AND TRANSFER OF OWNERSHIP

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

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

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

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

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

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

                                     Page 8



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

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

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

8.    STORAGE CHARGE

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

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

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

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

8.3   In the event that an Aircraft Contractual Delivery Date must be extended
      by Embraer from that which is designated in Article 5, due to Buyer's
      failure to perform any action or provide any information contemplated by
      this Agreement other than the ones specified in Article 8.1, the storage
      charge shall commence on the **Material Redacted** Day after the
      Contractual Delivery Date relative to such Aircraft.

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

9.    DELAYS IN DELIVERY

                                     Page 9



9.1   Excusable Delays:

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

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

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

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

9.1.5 **Material Redacted**

9.2   Non-Excusable Delays:

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

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

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

                                    Page 10



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

9.2.4 **Material Redacted**

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

10.   INSPECTION AND QUALITY CONTROL

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

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

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

10.4  For the purposes subject of this Article 10, Embraer shall provide
      communication facilities (telephone and facsimile) for Buyer's authorized
      representatives, as well as the necessary tools, measuring devices, test
      equipment and technical assistance as may be necessary to perform
      acceptance tests.

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

10.6  Buyer's authorized representative shall be allowed exclusively in those
      areas related to the subject matter of this Article 10 and Buyer
      furthermore agrees to hold harmless Embraer from and against all and any
      kind of liabilities in respect to such representatives, for whom Buyer is
      solely and fully responsible under all circumstances and in any instance.

11.   CHANGES

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

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

                                    Page 11



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

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

      **Material Redacted**

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

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

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

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

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

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

11.5  Major changes, (other than those which are AD's mandatory per Article
      11.4), any change developed by Embraer as product improvement and any
      change required by Buyer, including those changes required by Panamanian
      authorities as a consequence of alterations, amendments and/or innovations
      of its present applicable regulations, shall be considered as optional
      and, pursuant to Buyer's request, the corresponding cost proposals shall
      be submitted by Embraer to Buyer for consideration and approval. Should
      Buyer not approve any such change, it shall not be incorporated in the
      Aircraft.

                                    Page 12



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

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

12.   WARRANTY

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

13.   PRODUCT

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

14.   ASSIGNMENT

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

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

15.   RESTRICTIONS AND PATENT INDEMNITY

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

                                    Page 13



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

16.   MARKETING PROMOTIONAL RIGHTS

      Embraer shall have the right to show for marketing purposes, free of any
      charge, the image of Buyer's Aircraft, painted with Buyer's colors and
      emblems, affixed in photographs, drawings, films, slides, audiovisual
      works, models or any other medium of expression (pictorial, graphic, and
      sculptural works), through all mass communications media such as
      billboards, magazines, newspaper, television, movie, theaters, as well as
      in posters, catalogues, models and all other kinds of promotional
      material. **Material Redacted** Embraer **Material Redacted**. In the
      event such Aircraft is sold to or operated by or for another company or
      person, Embraer shall be entitled to disclose such fact, as well as to
      continue to show the image of the Aircraft, free of any charge, for
      marketing purposes, either with the original. If accepted, said
      prohibition, however, shall in no way apply to the promotional materials
      or pictorial, graphic or sculptural works already existing or to any
      contract for the display of such materials or works already binding
      Embraer at the time of receipt of the notification. **Material Redacted**.

17.   TAXES

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

18.   APPLICABLE LAW

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

19.   JURISDICTION

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

                                    Page 14



      **Material Redacted**

20.   TERMINATION

20.1  Should either Party fail to perform its obligations hereunder, the other
      Party shall be entitled to give notice of such failure and to require that
      such failure be remedied within the period specified in that notice, which
      period shall not be less than **Material Redacted** Days. Should such
      failure not be remedied within the period so specified, then the Party who
      gave notice of such failure shall be entitled to terminate this Agreement
      **Material Redacted**. The foregoing provision shall not apply in any
      circumstance where a specific right of termination is made available
      hereunder or will be made available hereunder upon the expiration of a
      specific period of time. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS
      AGREEMENT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY IN ANY
      CIRCUMSTANCE UNDER THIS AGREEMENT FOR ANY CONSEQUENTIAL OR PUNITIVE
      DAMAGES WHICH MAY ARISE OUT OF, OR BE CONNECTED TO, ANY BREACH OR DEFAULT
      UNDER OF ANY TERM, CONDITION, COVENANT, WARRANTY, OR PROVISION OF THIS
      AGREEMENT, AND WHICH EITHER PARTY WOULD OTHERWISE BE ENTITLED TO UNDER ANY
      APPLICABLE LAW, INCLUDING BUT NOT LIMITED TO ANY CLAIMS SOUNDING IN
      CONTRACT, TORT, EQUITY OR STATUTE.

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

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

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

20.5  **Material Redacted**

                                    Page 15



21.   OPTION FOR THE PURCHASE OF ADDITIONAL AIRCRAFT

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



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


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

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

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

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

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

                                    Page 16



      following:

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

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

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

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

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

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

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

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

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

22.   INDEMNITY

      Buyer agrees to indemnify and hold harmless Embraer and Embraer's
      officers, agents, employees and assignees from and against all
      liabilities, damages, losses, judgments, claims and suits, including costs
      and expenses incident thereto, which may be suffered by, accrued against,
      be charged to or recoverable from Embraer and/or Embraer's officers,
      agents, employees and assignees by reason of loss or damage to property or
      by reason of injury or death of any

                                    Page 17



      person resulting from or in any way connected with the performance of
      services by employees, representatives or agents of Embraer for or on
      behalf of Buyer related to Aircraft delivered by Embraer to Buyer,
      including, but not limited to, technical operations, maintenance, and
      training services and assistance performed while on the premises of
      Embraer or Buyer, while in flight on Buyer-owned Aircraft or while
      performing any other service, at any place, in conjunction with the
      Aircraft operations of Buyer, except to the extent caused by Embraer's
      willful misconduct or gross negligence.

23.   NOTICES

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

23.1  EMBRAER:

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

23.2  BUYER:

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

24.   CONFIDENTIALITY

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

                                    Page 18



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

25.   SEVERABILITY

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

26.   NON-WAIVER

      Except as otherwise specifically provided to the contrary in this
      Agreement, any Party's refrain from exercising any claim or remedy
      provided for herein shall not be deemed a waiver of such claim or remedy,
      and shall not relieve the other Party from the performance of such
      obligation at any subsequent time or from the performance of any of its
      other obligations hereunder.

27.   INTEGRATED AGREEMENT

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

28.   NEGOTIATED AGREEMENT

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

29.   WAIVER OF JURY TRIAL

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

30.   WAIVER OF IMMUNITY

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

                                    Page 19



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

31.   PAYMENTS IN US DOLLARS

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

32.   COUNTERPARTS

      This Agreement may be signed by the Parties in any number of separate
      counterparts with the same effect as if the signatures thereto and hereto
      were upon the same instrument and all of which when taken together shall
      constitute one and the same instrument.

33.   ENTIRE AGREEMENT

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

                                    Page 20

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

                                                                   Exhibit 10.19

                          LETTER AGREEMENT DCT-007/2003

                                      INDEX


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


EXHIBITS:

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



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

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

WHEREAS:

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

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

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

1 -- START-UP TEAM:

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

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

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

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

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

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

                                     Page 1



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

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

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

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

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

2 -- AEROCHAIN

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

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

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

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

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

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

                                     Page 2



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

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

3 -- **MATERIAL REDACTED**

4 -- **MATERIAL REDACTED**

5 -- SPARE PARTS CREDIT

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

6 -- **MATERIAL REDACTED**

7 -- **MATERIAL REDACTED**

8 -- **MATERIAL REDACTED**

9 -- **MATERIAL REDACTED**

10 -- **MATERIAL REDACTED**

11 -- **MATERIAL REDACTED**

12 -- APPLICABLE LAW

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

13 -- JURISDICTION

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

                                     Page 3



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

14 -- CONFIDENTIALITY

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

15 -- SEVERABILITY

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

16 -- NON-WAIVER

      Except as otherwise specifically provided to the contrary in this
      Agreement, any Party's refrain from exercising any claim or remedy
      provided for herein shall not be deemed a waiver of such claim or remedy,
      and shall not relieve the other Party from the performance of such
      obligation at any subsequent time or from the performance of any of its
      other obligations hereunder.

17 -- NEGOTIATED AGREEMENT

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

18 -- COUNTERPARTS

      This Agreement may be signed by the Parties in any number of separate
      counterparts with the same effect as if the signatures thereto and hereto
      were upon

                                     Page 4



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

                                     Page 5



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

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

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

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

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

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

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

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

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

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

                                     Page 1



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

                              **Material Redacted**

                                     Page 1

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

                                                                   Exhibit 10.20

                          LETTER AGREEMENT DCT-008/2003

This Letter Agreement DCT-008/2003 ("Agreement" or "Letter Agreement") dated May
__, 2003 is an agreement between Regional Aircraft Holdings Ltd. ("Buyer") with
its address c/o Galindo, Arias y Lopez, Avenida Federico Boyd Numero 51 Piso 11,
Panama, Rep of Panama, and EMBRAER - Empresa Brasileira de Aeronautica S.A.
("Embraer" or "Embraer-Brazil"), with its principal place of business at Sao
Jose dos Campos, SP, Brazil (collectively the "Parties"), relating to Purchase
Agreement DCT-006/03 (the "Purchase Agreement") dated as of May ___,2003.

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

WHEREAS:

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

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

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

1 - **MATERIAL REDACTED**

2 - APPLICABLE LAW

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

3 - JURISDICTION

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

4 - CONFIDENTIALITY

      Notwithstanding anything to the contrary in the Purchase Agreement,
      neither Buyer



      nor Embraer shall disclose the terms of this Agreement except as needed to
      its officers, employees, auditors, insurers (brokers) and legal advisors
      and except (a) as required by law or legal process or (b) with the prior
      written consent of the other party. In addition, Buyer and Embraer may
      disclose the terms of this Agreement to shareholders who hold more than
      ten percent (10%) of their respective common shares, provided that (i)
      such shareholders are not, in the case of Buyer, competitors or affiliates
      of competitors of Embraer in the business of manufacturing aircraft, or in
      the case of Embraer, competitors or affiliates of competitors of Copa
      Airlines, S.A. in the business of a scheduled airline, and (ii) such
      shareholders, to the extent not officers of a Party shall have executed a
      confidentiality agreement with the other Party. Without limiting the
      foregoing, in the event either party is legally required to disclose the
      terms of this Agreement, each party hereto agrees to exert its best
      efforts to request confidential treatment of the Articles and conditions
      of this Agreement relevantly designated by the other as confidential.

5 - SEVERABILITY

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

6 - NEGOTIATED AGREEMENT

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

7 - COUNTERPARTS

      This Agreement may be signed by the Parties hereto in any number of
      separate counterparts with the same effect as if the signatures thereto
      and hereto were upon the same instrument and all of which when taken
      together shall constitute one and the same instrument.

                                     Page 2

                                                                   EXHIBIT 10.40



                                FORM OF DIRECTOR
                               INDEMNITY AGREEMENT

            This agreement is between Copa Holdings, S.A., a Panamanian
corporation (sociedad anonima) (the "Company") and , Director of the Company
(the "Indemnitee").

            A. Indemnitee is Director of the Company.

            B. Both the Company and Indemnitee recognize the increased risk of
litigation and other claims being asserted against directors and officers of
public companies in today's environment.

            C. The Pacto Social of the Company (the "Pacto Social") require the
Company to indemnify to its directors and officers to the fullest extent
permitted by law and the Indemnitee has been serving and continues to serve as
Director of the Company in part in reliance on such provisions.

            D. In recognition of Indemnitee's need for substantial protection
against any potential personal liability in order to assure Indemnitee's
continued service to the Company in an effective manner and Indemnitee's
reliance on the provisions of the Pacto Social and in part to provide Indemnitee
with specific contractual assurance that the protection promised by the Pacto
Social will be available to Indemnitee (regardless of, among other things, any
amendment to or revocation of any provision of the Company's Pacto Social or any
change in the composition of the Company's Board of Directors or any acquisition
of the Company), the Company wishes to provide in this Agreement for the
indemnification of and the advancing of expenses to Indemnitee to the fullest
extent (whether partial or complete) permitted by law and as set forth in this
Agreement, and for the continued coverage of the Indemnitee under the Company's
directors' and officers' liability insurance policies.

            The parties hereto agree as follows:

            1. Certain Definitions.

            (a) "Change in Control" shall be deemed to have occurred if (i) any
"person" (as such term is used in Section 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended), other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company or a
corporation owned directly or indirectly by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the Company,
is or becomes the "beneficial owner" (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the Company representing 20% or more of
the total voting power represented by the Company's then outstanding voting
securities, or (ii) during any period of 24 consecutive months, individuals who
at the beginning of such period constitute the Board of Directors of the Company
and any new director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at least a
majority of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to

                                                                               2


constitute a majority thereof, or (iii) the stockholders of the Company approve
a merger or consolidation of the Company with any other corporation or entity,
other than a merger or consolidation that would result in the voting securities
of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least 80% of the total voting power represented by the
voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or the stockholders of the
Company approve a plan of complete liquidation of the Company or an agreement
for the sale or disposition by the Company, in one transaction or a series of
transactions, of all or substantially all the Company's assets.

            (b) "Proceeding" shall mean any completed, actual, pending or
threatened action, suit, claim, inquiry or proceeding, whether civil, criminal,
administrative or investigative (including an action by or in the right of the
Company) and whether formal or informal.

            (c) "Expenses" means all direct and indirect costs of any type or
nature whatsoever (including, without limitation, all attorneys' fees and
related disbursements and other out-of- pocket costs) actually and reasonably
incurred by the Indemnitee in connection with the investigation, defense or
appeal of or being a witness in, participating in or preparing to defend a
Proceeding or establishing or enforcing a right to (i) indemnification or
advancement of expenses under this Agreement, the Pacto Social, Panamanian law
or otherwise or (ii) directors' and officers' liability insurance coverage;
provided, however, that Expenses shall not include any judgments, fines or
penalties or amounts paid in settlement of a Proceeding.

            (d) "Indemnifiable Event" is any event or occurrence related to the
fact that Indemnitee is or was a director or officer of the Company, or is or
was serving at the request of the Company as a director, officer, employee,
trustee or agent of another corporation, partnership, joint venture, trust,
nonprofit entity or other entity (including service with respect to employee
benefit plans), or by reason of anything done or not done by Indemnitee in any
such capacity.

            (e) "Indemnification Period" shall be such period as the Indemnitee
shall continue to serve as a director or officer of the Company, or shall
continue at the request of the Company to serve as a director, officer,
employee, trustee or agent of another corporation, partnership, joint venture,
trust, nonprofit entity or other entity, and thereafter so long as the
Indemnitee shall be subject to any possible Proceeding arising out of the
Indemnitee's tenure in the foregoing positions.

            (f) "Losses" are any judgments, fines, penalties and amounts paid in
settlement (including all interest assessments and other charges paid or payable
in connection with or in respect of such judgments, fines, penalties or amounts
paid in settlement) of any Proceeding.

            (g) "Reviewing Party" shall mean (i) the Board of Directors
(provided that a majority of directors are not parties to the Proceeding), (ii)
a person or body selected by the Board of Directors or (iii) if there has been a
Change in Control, the special independent counsel referred to in Section 5.

                                                                               3



            2. Indemnification and Advancement of Expenses. Subject to the
limitations set forth in Section 4:

            (a) Indemnification. The Company shall indemnify and hold harmless
Indemnitee, to the fullest extent permitted by applicable law, as soon as
practicable after written demand is presented to the Company, in the event
Indemnitee was or is made or is threatened to be made a party to or witness in
or is otherwise involved in a Proceeding by reason, in whole or in part, of an
Indemnifiable Event against all Expenses and Losses incurred by Indemnitee in
connection with such Proceeding. In the event of any change, after the date of
this Agreement, in any applicable law, statute or rule regarding the right of a
Panamanian corporation to indemnify a member of its Board of Directors or an
officer, such change, to the extent it would expand Indemnitee's rights under
this Agreement, shall be included within Indemnitee's rights and the Company's
obligations under this Agreement, and, to the extent it would narrow
Indemnitee's rights or the Company's obligations under this Agreement, shall be
excluded from this Agreement.

            (b) Advancement of Expenses. The Company shall to the fullest extent
permitted by applicable law pay the Expenses incurred by Indemnitee as soon as
practicable after written demand is presented to the Company in the event
Indemnitee was or is made or is threatened to be made a party to or witness in
or is otherwise involved in a Proceeding by reason, in whole or in part, of an
Indemnifiable Event in advance of its final disposition; provided, however,
that, to the extent required by law, such payment of expenses in advance of the
final disposition of the Proceeding shall be made only upon receipt of an
undertaking by the Indemnitee to repay all amounts advanced if it should be
ultimately determined that the Indemnitee is not entitled to be indemnified
under this Agreement, Panamanian law or otherwise.

            (c) Partial Indemnity. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a portion of the
Losses or Expenses, but not, however, for all of the total amount thereof, the
Company shall indemnify Indemnitee for the portion thereof to which Indemnitee
is entitled. Notwithstanding any other provision of this Agreement, to the
extent that Indemnitee has been successful on the merits or otherwise in defense
of any issue or matter therein, including dismissal without prejudice,
Indemnitee shall be indemnified against all Expenses incurred in connection
therewith.

            (d) Contribution. If the indemnification provided in Section 2(a)
for any reason is unavailable to the Indemnitees, then in respect of any
Indemnifiable Event, the Company shall contribute to the amount of Expenses and
Losses paid in settlement actually incurred and paid or payable by the
Indemnitee in such proportion as is appropriate to reflect (i) the relative
benefits received by the Company on the one hand and the Indemnitee on the other
hand from the transaction from which such proceeding arose and (ii) the relative
fault of the Company on the one hand and of the Indemnitee on the other hand in
connection with the events which resulted in such Expenses and Losses, as well
as any other relevant equitable considerations. The relative fault of the
Company on the one hand and of the Indemnitee on the other hand shall be
determined by reference to, among other things, the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent the
circumstances

                                                                               4


resulting in such expenses, judgments, fines or settlement amounts. The Company
agrees that it would not be just and equitable if contribution pursuant to this
Section 2(d) were determined by pro rata allocation or any other method of
allocation which does not take account of the foregoing equitable
considerations.

            (e) Enforcement. If a claim for indemnification (following the final
disposition of such Proceeding) under Section 2(a) or advancement of Expenses
under Section 2(b) is not paid in full within thirty days after a written claim
therefor by the Indemnitee has been presented to the Company, the Indemnitee may
file suit against the Company to recover the unpaid amount of such claim and, if
successful in whole or in part, shall be entitled to be paid the expense of
prosecuting such claim. In addition, Indemnitee may file suit against the
Company to establish a right to indemnification or advancement of Expenses
arising under this Agreement, the Pacto Social, Panamanian law or otherwise. In
any such action the Company shall have the burden of proving by clear and
convincing evidence that the Indemnitee is not entitled to the requested
indemnification or advancement of Expenses under applicable law.

            3. Notification and Defense of Proceeding. Promptly after receipt by
Indemnitee of notice of the commencement of or threat of the commencement of any
Proceeding, Indemnitee shall, if a request for indemnification in respect
thereof is to be made against the Company under this Agreement, notify the
Company of the commencement thereof; but the failure to notify the Company will
not relieve the Company from any liability which it may have to Indemnitee under
this Agreement or otherwise unless and only to the extent that such omission can
be shown to have prejudiced the Company's ability to defend the Proceeding.
Except as otherwise provided below, the Company shall be entitled to assume the
defense of such Proceeding, with counsel approved by Indemnitee (which approval
shall not be unreasonably withheld). After notice from the Company to Indemnitee
of its election to assume the defense thereof, the Company will not be liable to
Indemnitee under this Agreement for any legal or other expenses subsequently
incurred by Indemnitee in connection with the defense thereof other than
reasonable costs of investigation or as otherwise provided below. Indemnitee
shall have the right to employ its counsel in such Proceeding, but the fees and
expenses of such counsel incurred after notice from the Company of its
assumption of the defense thereof shall be at the expense of Indemnitee unless
(i) the employment of counsel by Indemnitee has been authorized by the Company,
(ii) Indemnitee shall have reasonably concluded that there may be a conflict of
interest between the Company and the Indemnitee in the conduct of the defense of
such Proceeding or (iii) the Company shall not in fact have employed counsel to
assume the defense of such Proceeding, in each of which cases the fees and
expenses of counsel shall be at the expense of the Company. The Company shall
not be entitled to assume the defense of any Proceeding brought by or on behalf
of the Company or as to which the Indemnitee shall have made the conclusion
provided for in clause (ii) of this Section 3. The Company shall not settle any
Proceeding in any manner, which would impose any penalty, limitation, admission,
loss or Expense on the Indemnitee without the Indemnitee's prior written
consent. Neither the Company nor the Indemnitee will unreasonably withhold its
consent to any proposed settlement, provided that Indemnitee may, in
Indemnitee's sole discretion, withhold consent to any proposed settlement that
would impose any penalty, limitation, admission, loss or Expense on the
Indemnitee.

            4. Limitation on Indemnification. Notwithstanding the terms of
Section 2:

                                                                               5



            (a) the obligations of the Company set forth in Section 2 shall be
subject to the presumption that Indemnitee is entitled indemnification here
under unless the Reviewing Party shall have determined (based on a written
opinion of independent outside counsel in all cases) that Indemnitee would not
be permitted to be so indemnified under applicable law; provided, however, that
if Indemnitee has commenced or thereafter commences legal proceedings in a court
of competent jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the Reviewing Party
that Indemnitee would not be permitted to be indemnified under applicable law
shall not be binding and Indemnitee shall not be required to reimburse the
Company for any advancement of Expenses until a final judicial determination is
made with respect thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed) and the Company shall not be obligated to indemnify or
advance to Indemnitee any additional amounts covered by such Reviewing Party
determination (unless there has been a determination by a court of competent
jurisdiction that the Indemnitee would be permitted to be so indemnified under
applicable law);

            (b) the Company shall not be required to indemnify or advance
Expenses to the Indemnitee with respect to a Proceeding (or part thereof) by the
Indemnitee (and not by way of defense), except if the commencement of such
Proceeding (i) is expressly required to be made by applicable law, and (ii) was
authorized in the specific case by the Board of Directors or (ii) brought to
establish or enforce a right to indemnification and/or advancement of Expenses
arising under this Agreement, the Pacto Social, Panamanian law or otherwise;

            (c) the Company shall not be obligated pursuant to the terms of this
Agreement to indemnify the Indemnitee for any amounts paid in settlement of a
Proceeding unless the Company consents in advance in writing to such settlement,
which consent shall not be unreasonably withheld;

            (d) the Company shall not be obligated pursuant to the terms of this
Agreement to indemnify the Indemnitee on account of any suit in which judgment
is rendered against the Indemnitee for an accounting of profits made from the
purchase or sale by the Indemnitee of securities of the Company pursuant to the
provisions of Section l6(b) of the Securities Exchange Act of 1934, as amended
or similar provisions of any federal, state or local statutory law;

            (e) the Company shall not be obligated pursuant to the terms of this
Agreement to indemnify the Indemnitee if a final decision by a court having
jurisdiction in the matter shall determine that such indemnification is not
lawful; and

            (f) the Company shall not be obligated pursuant to the terms of this
Agreement to make any payment in connection with any Proceeding to the extent
Indemnitee has otherwise actually received payment (under any insurance policy
or otherwise) of the amounts otherwise indemnifiable under this Agreement.

            (g) the Company shall not be obligated pursuant to the terms of this
Agreement to indemnify the Indemnitee if a final decision by a Court having
jurisdiction in the matter shall determine that the actions that give rise to
the Indemnification Event are proven to be the result of Indemnitee's willful
misconduct or gross negligence.

                                                                               6



            5. Change in Control of Company. The Company agrees that if there is
a Change in Control of the Company, then with respect to all matters thereafter
arising concerning the rights of Indemnitee to indemnity payments and Expense
advances under this Agreement, any other agreements, the Pacto Social now or
hereafter in effect relating to Proceedings for Indemnifiable Events, the
Company shall seek legal advice only from special independent counsel selected
by Indemnitee and approved by the Company's Board of Directors (which approval
shall not be unreasonably withheld), and who has not otherwise performed
services for the Company (other than in connection with such matters) or
Indemnitee. Such special independent counsel, among other things, shall
determine whether and to what extent the Indemnitee would be permitted to be
indemnified under applicable law and shall render its written opinion to the
Company and Indemnitee to such effect. The Company agrees to pay the reasonable
fees of the special independent counsel referred to above and to fully indemnify
such counsel against any and all expenses (including attorneys' fees),
Proceedings, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant to this Agreement.

            6. Subrogation. In the event of payment to Indemnitee under this
Agreement, the Company shall be subrogated to the extent of such payment to all
of the rights of recovery of Indemnitee, who shall execute all papers required
and shall do everything that may be necessary to secure such rights, including
the execution of such documents necessary to enable the Company effectively to
bring suit to enforce such rights.

            7. No Presumptions. For purposes of this Agreement, the termination
of any Proceeding against Indemnitee by judgment, order, settlement (whether
with or without court approval) or conviction, or upon a plea of nolo
contendere, or its equivalent, shall not create a presumption that Indemnitee
did not meet any particular standard of conduct or have any particular belief or
that a court has determined that indemnification is not permitted by applicable
law. In addition, neither the failure of the Reviewing Party to have made a
determination as to whether Indemnitee has met any particular standard of
conduct or had any particular belief, nor an actual determination by the
Reviewing Party that Indemnitee has not met such standard of conduct or did not
have such belief shall be a defense to Indemnitee's Proceeding for
indemnification or create a presumption that Indemnitee has not met any
particular standard of conduct or did not have any particular belief shall be a
defense to Indemnitee's Proceeding for indemnification or create a presumption
that Indemnitee has not a met any particular standard of conduct or did not have
a particular belief.

            8. Non-Exclusivity. The rights conferred on the Indemnitee by this
Agreement shall not be exclusive of any other rights which the Indemnitee may
have or hereafter acquire under any statute, provision of the Pacto Social,
agreement, vote of stockholders or disinterested directors or otherwise, and to
the extent that during the Indemnification Period such rights are more favorable
than the rights currently provided under this Agreement to Indemnitee,
Indemnitee shall be entitled to the full benefits of such more favorable rights
to the extent permitted by law. Other than as set forth in this Section 8, in
the case of any inconsistency between the indemnification provisions of this
Agreement and any other agreement relating to the indemnification of an
Indemnitee, the indemnification provisions of this Agreement shall control.

                                                                               7



            9. Liability Insurance. The Company may, to the extent that the
Board of Directors in good faith determines it to be economically reasonable,
maintain a policy of directors' and officers' liability insurance, on such terms
conditions as may be approved by the Board of Directors. To the extent the
Company maintains directors' and officers' liability insurance, the Indemnitee
shall be covered by such policy in such a manner as to provide Indemnitee the
same rights and benefits as are accorded to the most favorably insured of the
Company's directors. Notice of any termination or failure to renew such policy
shall be provided to Indemnitee promptly upon the Company's becoming aware of
such termination or failure to renew. The Company shall provide copies of all
such insurance policies and any endorsements thereto whenever such documents
have been provided to the Company.

            10. Amendment/Waiver. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both of the
parties hereto. No waiver of any of the provisions of this Agreement shall be
deemed or shall constitute a waiver of any other provisions of this Agreement
(whether or not similar) nor shall such waiver constitute a continuing waiver.
Any waiver to this Agreement shall be in writing.

            11. Binding Effect. This Agreement shall be binding upon and inure
to the benefit of and be enforceable by the parties hereto and their respective
successors, assigns, including any direct or indirect successor by purchase,
merger, consolidation or otherwise to all or substantially all of the business
and/or assets of the Company, spouses, heirs, and personal and legal
representatives.

            12. Survival. This Agreement shall continue in effect during the
Indemnification Period, regardless of whether Indemnitee continues to serve as a
director of the Company or of any other enterprise at the Company's request.

            13. Severability. The provisions of this Agreement shall be
severable in the event that any provision of this Agreement (including any
provision within a single section, paragraph or sentence) is held by a court of
competent jurisdiction to be invalid, void or otherwise unenforceable, and the
remaining provisions shall remain enforceable to the fullest extent permitted by
law.

            14. Period of Limitations. No legal action shall be brought and no
cause of action shall be asserted by or in the right of the Company against
Indemnitee, Indemnitee's estate, spouse, heirs, executors or personal or legal
representatives after the expiration of three years from the date of accrual of
such cause of action, and any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal
action within such three year period; provided, however, that if any shorter
period of limitations is otherwise applicable to any such cause of action, such
shorter period shall govern.

            15. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the Republic of Panama without
giving effect to the principles of conflicts of laws.

                                                                               8



            16. Choice of Forum. With respect to any legal action relating to
the interpretation or enforcement of this Agreement, the parties hereto
irrevocably agree and consent to be subject to the jurisdiction of the Courts of
the Republic of Panama.



                                         COPA HOLDINGS, S.A.


                                         By: ____________________
                                             Name:
                                             Title:


                                         [INDEMNITEE]



                                         By: ____________________
                                             Name: