BRA and Embraer Sign Contract for the sale of up to 75 Embraer 195 Jets

Released on Tuesday, August 21, 2007

S�o José dos Campos, August 21, 2007 � Embraer signed a contract, today, in S�o José dos Campos with Brazilian airline BRA Transportes Aéreos for the sale of 20 EMBRAER 195 jets, with another 20 options for the same model, ratifying the preliminary commercial agreement signed in June, during the Paris Air Show. Furthermore, BRA has 20 rolling options, which, if confirmed, provide purchase rights for another 15 aircraft, and the overall order could total 75 jets. The value of the firm order, at list price, is US$ 730 million, under the economic conditions of January 2007 (not including optional equipment ordered by BRA), and could come to US$ 2.7 billion, if all of the other 55 jets are confirmed. The EMBRAER 195 is the largest member of a new family of four commercial jets serving the 70 to 120-seat market � the E-Jets.

The ceremony was attended by the President of Brazil, Mr. Luiz Inácio Lula da Silva, Ministers of State, Federal, State and Municipal dignitaries, members of the press, and Embraer employees.

BRA Transportes Aéreos stands out as the first Brazilian airline to operate Embraer's modern E-Jets in Brazil, joining 38 other renowned airlines, in 26 countries, which have also chosen these Brazilian aircraft. BRA had already signed a leasing contract with GE Commercial Aviation Services (GECAS) to operate another two new EMBRAER 195 jets, with the delivery schedule expected to begin during the first semester of 2008.

"We are very happy to receive confirmation of the first sale of our E-Jets to a Brazilian airline," stated Frederico Fleury Curado, Embraer President and CEO. "It is our belief that the EMBRAER 195 will exercise a positive influence for changing the commercial aviation scenario in Brazil and that BRA will stand out, nationwide, for its efficiency and superior level of comfort for its passengers."

From 1997 to 2005, the number of Brazilian cities served by domestic flights was reduced by about 30%, thus increasing concentration on routes representing greater demand. Another aspect that has come to the forefront throughout the years in the Brazilian domestic market, in detriment to airline passengers in Brazil, are operations based on multi-stop routes, due to the use of aircraft with larger capacity.

Embraer's E-Jets are faced with an excellent opportunity to revert this scenario, because they allow operating profitable nonstop flights on lower-density routes, thus contributing to boosting the quality and increasing the frequency and capillarity of airline services.

BRA chose the EMBRAER 195, configured with 118 single-class seats, as the ideal airplane for its business model, which will provide direct flights to cities that are now connected by multi-stop flights.

"We are highly motivated by closing this deal, and are proud to be the first Brazilian airline to operate Embraer's E-Jets, which have become so successful worldwide," stated Humberto Folegatti, BRA President and CEO. "The EMBRAER 195 offers comfort, flexibility and low operating cost, and will be the basis for the expansion of our fleet."