Issuer Free Writing Prospectus
Filed pursuant to Rule 433(d)
Registration No. 333-158781
October 27, 2009
Continental Airlines, Inc. (“Continental”)
(NYSE Symbol: CAL)
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Continental is increasing the size of the 2009-2 EETC transaction in order to finance more aircraft. This free writing prospectus sets forth the corresponding material changes to Continental’s Preliminary Prospectus Supplement dated October 27, 2009 (the “Supplement”), relating to the Certificates referred
to below, and should be read together with the Supplement and the accompanying Prospectus dated April 24, 2009. The information herein supersedes any inconsistent information set forth in the Supplement. | ||||
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Aircraft to be Financed: |
19 total Aircraft, consisting of all nine new Boeing 737-824 described in the Supplement, rather than only seven of such new aircraft, as well as the other ten aircraft described in the Supplement. | |||
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Aggregate Appraised Aircraft Value (1): |
$952,308,120 |
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Aggregate Face Amount: |
$644,437,000 |
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Initial Amount of Deposits: |
$644,437,000 |
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Securities: |
Class A Pass Through Certificates, Series 2009-2 (“Class A Certificates”) |
Class B Pass Through Certificates, Series 2009-2 (“Class B Certificates” and, together with the Class A Certificates, the “Certificates”) |
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Face Amount: |
$527,625,000 |
$116,812,000 |
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Initial LTV
(cumulative) (1): |
53.9% |
65.5% |
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Highest LTV
(cumulative) (2): |
53.9% |
65.5% |
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____________
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(1) |
Determined as of November 10, 2010, the first Regular Distribution Date after all aircraft are expected to have been financed pursuant to this Offering. |
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(2) |
See “Loan to Value Ratios” below. |
Equipment Notes and the Aircraft
The 19 Aircraft to be financed pursuant to this Offering will consist of eight Boeing aircraft currently owned by Continental and 11 new Boeing aircraft. The eight currently owned aircraft consist of three Boeing 737-824 aircraft, three Boeing 757-224 aircraft, one Boeing 767-424ER aircraft and one Boeing 777-224ER aircraft. The
11 new aircraft consist of nine Boeing 737-824 aircraft scheduled for delivery from January to June 2010, and two Boeing 777-224ER aircraft scheduled for delivery in April and May 2010. Set forth below is certain information about the Equipment Notes expected to be held in the Trusts and the aircraft expected to secure such Equipment Notes:
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Aircraft Type(1) |
Registration
Number |
Manufacturer’s
Serial Number |
Delivery
Month(2) |
Principal
Amount of Equipment
Notes |
Appraised
Value(3) |
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Boeing 737-824 |
N14235 | 28947 |
August 1999 |
$ | 19,017,000 | $ | 28,833,333 | |||||||
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Boeing 737-824 |
N37253 | 30584 |
September 2000 |
18,547,000 | 28,120,000 | |||||||||
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Boeing 737-824 |
N76254 | 30779 |
September 2000 |
17,748,000 | 26,910,000 | |||||||||
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Boeing 737-824 |
N76519 | 30132 |
January 2010 |
32,582,000 | 49,400,000 | |||||||||
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Boeing 737-824 |
N77520 | 31658 |
January 2010 |
32,582,000 | 49,400,000 | |||||||||
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Boeing 737-824 |
N79521 | 31662 |
February 2010 |
32,582,000 | 49,400,000 | |||||||||
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Boeing 737-824 |
N76522 | 31660 |
February 2010 |
32,582,000 | 49,400,000 | |||||||||
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Boeing 737-824 |
N76523 | 37101 |
March 2010 |
32,582,000 | 49,400,000 | |||||||||
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Boeing 737-824 |
N78524 | 31642 |
March 2010 |
32,582,000 | 49,400,000 | |||||||||
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Boeing 737-824 |
N77525 | 31659 |
April 2010 |
32,582,000 | 49,400,000 | |||||||||
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Boeing 737-824 |
N76526 | 38700 |
May 2010 |
32,582,000 | 49,500,000 | |||||||||
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Boeing 737-824 |
N87527 | 38701 |
June 2010 |
32,582,000 | 49,500,000 | |||||||||
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Boeing 757-224 |
N17139 | 30352 |
February 2000 |
15,189,000 | 23,030,000 | |||||||||
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Boeing 757-224 |
N41140 | 30353 |
February 2000 |
15,563,000 | 23,596,667 | |||||||||
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Boeing 757-224 |
N19141 | 30354 |
June 2000 |
16,825,000 | 25,510,000 | |||||||||
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Boeing 767-424ER |
N67052 | 29447 |
September 2000 |
29,427,000 | 44,616,667 | |||||||||
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Boeing 777-224ER |
N79011 | 29859 |
June 1999 |
47,131,000 | 71,460,000 | |||||||||
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Boeing 777-224ER |
N76021 | 39776 |
April 2010 |
85,807,000 | 130,100,000 | |||||||||
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Boeing 777-224ER |
N77022 | 39777 |
May 2010 |
85,945,000 | 130,310,000 | |||||||||
_______________
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(1) |
The indicated registration number, manufacturer’s serial number and delivery month for each new aircraft reflect our current expectations, although these may differ for the actual aircraft financed hereunder. The deadline for purposes of financing an Aircraft pursuant to this Offering is August 31, 2010. The financing of each currently-owned Aircraft pursuant to this Offering is expected to be effected after
the existing security interest on such Aircraft has been discharged, and the financing of each new Aircraft is expected to be effected at delivery of such Aircraft by Boeing to Continental. The actual delivery date for any new aircraft may be subject to delay or acceleration. See “Description of the Aircraft and the Appraisals — Timing of Financing the Aircraft” in the Supplement. Continental has certain rights to substitute other new aircraft if the scheduled delivery date of any new Aircraft
is delayed for more than 30 days after the month scheduled for delivery. See “Description of the Aircraft and the Appraisals — Substitute Aircraft” in the Supplement. |
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(2) |
An Aircraft with a Delivery Month prior to the date of the Supplement is a currently-owned Aircraft, and an Aircraft with a Delivery Month after the date of the Supplement is a new Aircraft. |
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(3) |
The appraised value of each Aircraft set forth above is the lesser of the average and median values of such Aircraft as appraised by three independent appraisal and consulting firms. In the case of the new Aircraft, such appraisals indicate appraised base value, projected as of the scheduled delivery month of the applicable Aircraft, and in the case of the currently-owned Aircraft, such appraisals indicate appraised
base value, adjusted for the maintenance status of the applicable Aircraft. These appraisals are based upon varying assumptions and methodologies. An appraisal is only an estimate of value and should not be relied upon as a measure of realizable value. See “Risk Factors — Risk Factors Relating to the Certificates and the Offering — The Appraisals Are Only Estimates of Aircraft Value” in the Supplement. |
Loan to Aircraft Value Ratios
The following table sets forth loan to Aircraft value ratios (“LTVs”) for each Class of Certificates as of November 10, 2010, the first Regular Distribution Date after all Aircraft are expected to have been financed pursuant to the Offering, and each Regular Distribution Date thereafter. The LTVs for any Class of Certificates
for the period prior to November 10, 2010, are not meaningful, since during such period all of the Equipment Notes expected to be acquired by the Trusts and the related Aircraft will not be included in the calculation. The table should not be considered a forecast or prediction of expected or likely LTVs but simply a mathematical calculation based on one set of assumptions. See “Risk Factors — Risk Factors Relating to the Certificates and the Offering — The Appraisals Are Only Estimates
of Aircraft Value” in the Supplement.
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Assumed |
Outstanding Balance (2) |
LTV (3) | |||||||||||
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Regular |
Aggregate |
Class A |
Class B |
Class A |
Class B | ||||||||
|
Distribution Date |
Aircraft Value(1) |
Certificates |
Certificates |
Certificates |
Certificates | ||||||||
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November 10, 2010 |
$ | 952,308,120 | $ | 513,049,061 | $ | 110,955,157 | 53.9% | 65.5% | |||||
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May 10, 2011 |
935,961,021 | 502,255,148 | 104,480,504 | 53.7% | 64.8% | ||||||||
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November 10, 2011 |
919,613,923 | 489,033,871 | 97,914,792 | 53.2% | 63.8% | ||||||||
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May 10, 2012 |
903,266,825 | 475,783,496 | 91,345,021 | 52.7% | 62.8% | ||||||||
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November 10, 2012 |
886,919,726 | 462,505,424 | 84,701,081 | 52.1% | 61.7% | ||||||||
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May 10, 2013 |
870,572,628 | 449,197,821 | 78,009,302 | 51.6% | 60.6% | ||||||||
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November 10, 2013 |
854,225,529 | 435,858,686 | 71,211,141 | 51.0% | 59.4% | ||||||||
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May 10, 2014 |
837,878,431 | 422,463,361 | 64,360,650 | 50.4% | 58.1% | ||||||||
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November 10, 2014 |
820,799,264 | 408,725,540 | 57,475,949 | 49.8% | 56.8% | ||||||||
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May 10, 2015 |
803,555,598 | 394,584,586 | 50,592,818 | 49.1% | 55.4% | ||||||||
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November 10, 2015 |
785,968,528 | 380,164,280 | 43,698,139 | 48.4% | 53.9% | ||||||||
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May 10, 2016 |
767,698,947 | 365,314,874 | 36,779,712 | 47.6% | 52.4% | ||||||||
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November 10, 2016 |
749,429,366 | 354,364,015 | 29,849,478 | 47.3% | 51.3% | ||||||||
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May 10, 2017 |
731,159,784 | 343,410,613 | - | 47.0% | 0.0% | ||||||||
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November 10, 2017 |
712,890,203 | 332,454,467 | - | 46.6% | 0.0% | ||||||||
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May 10, 2018 |
694,620,622 | 321,495,353 | - | 46.3% | 0.0% | ||||||||
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November 10, 2018 |
676,351,041 | 310,533,024 | - | 45.9% | 0.0% | ||||||||
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May 10, 2019 |
658,081,459 | 299,567,204 | - | 45.5% | 0.0% | ||||||||
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November 10, 2019 |
639,079,810 | - | - | 0.0% | 0.0% | ||||||||
_______________
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(1) |
We have assumed that all Aircraft will be financed under this Offering prior to November 10, 2010, and that the initial appraised value of each Aircraft, determined as described under “— Equipment Notes and the Aircraft”, declines by approximately 3% per year for the first 15 years after the year of delivery of such Aircraft, 4% per year for each of the next five years and 5% per year for any
subsequent year, in each case prior to the final expected Regular Distribution Date. Other rates or methods of depreciation may result in materially different LTVs. We cannot assure you that the depreciation rate and method used for purposes of the table will occur or predict the actual future value of any Aircraft. See “Risk Factors — Risk Factors Relating to the Certificates and the Offering — The Appraisals Are Only Estimates of Aircraft Value” in the Supplement. |
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(2) |
In calculating the outstanding balances of each Class of Certificates, we have assumed that the Trusts will acquire the Equipment Notes for all Aircraft. Outstanding balances as of each Regular Distribution Date are shown after giving effect to distributions expected to be made on such distribution date. |
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(3) |
The LTVs for each Class of Certificates were obtained for each Regular Distribution Date by dividing (i) the expected outstanding balance of such Class (together, in the case of the Class B Certificates, with the expected outstanding balance of the Class A Certificates), after giving effect to the distributions expected to be made on such distribution date, by (ii) the assumed value of all of the Aircraft on such
date based on the assumptions described above. The outstanding balances and LTVs of each Class of Certificates will change if the Trusts do not acquire Equipment Notes with respect to all the Aircraft. |
Assumed Amortization Schedule and resulting Pool Factors
The following table sets forth the expected aggregate principal amortization schedule for the Equipment Notes held in each Trust (the “Assumed Amortization Schedule”) and resulting Pool Factors with respect to such Trust. The scheduled distribution of principal payments for any Trust would be affected if Equipment Notes with
respect to any Aircraft are not acquired by such Trust, if any Equipment Notes held in such Trust are redeemed or purchased or if a default in payment on such Equipment Notes occurs. Accordingly, the aggregate principal amortization schedule applicable to a Trust and the resulting Pool Factors may differ from those set forth in the following table.
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Class A |
Class B |
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Date |
Scheduled
Principal
Payments |
Expected
Pool
Factor |
Scheduled
Principal
Payments |
Expected
Pool
Factor |
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Issuance Date |
$ | 0.00 | 1.0000000 | $ | 0.00 | 1.0000000 | ||||||||||
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May 10, 2010 |
0.00 | 1.0000000 | 0.00 | 1.0000000 | ||||||||||||
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November 10, 2010 |
14,575,938.51 | 0.9723744 | 5,856,842.52 | 0.9498610 | ||||||||||||
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May 10, 2011 |
10,793,913.02 | 0.9519169 | 6,474,653.46 | 0.8944330 | ||||||||||||
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November 10, 2011 |
13,221,277.33 | 0.9268588 | 6,565,711.83 | 0.8382255 | ||||||||||||
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May 10, 2012 |
13,250,375.10 | 0.9017456 | 6,569,771.64 | 0.7819832 | ||||||||||||
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November 10, 2012 |
13,278,071.55 | 0.8765798 | 6,643,939.79 | 0.7251060 | ||||||||||||
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May 10, 2013 |
13,307,603.12 | 0.8513581 | 6,691,779.18 | 0.6678192 | ||||||||||||
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November 10, 2013 |
13,339,135.18 | 0.8260766 | 6,798,160.50 | 0.6096218 | ||||||||||||
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May 10, 2014 |
13,395,325.46 | 0.8006887 | 6,850,491.31 | 0.5509764 | ||||||||||||
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November 10, 2014 |
13,737,820.49 | 0.7746516 | 6,884,701.15 | 0.4920380 | ||||||||||||
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May 10, 2015 |
14,140,953.80 | 0.7478504 | 6,883,130.67 | 0.4331132 | ||||||||||||
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November 10, 2015 |
14,420,305.96 | 0.7205198 | 6,894,679.37 | 0.3740895 | ||||||||||||
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May 10, 2016 |
14,849,406.78 | 0.6923760 | 6,918,426.68 | 0.3148624 | ||||||||||||
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November 10, 2016 |
10,950,858.35 | 0.6716210 | 6,930,233.66 | 0.2555343 | ||||||||||||
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May 10, 2017 |
10,953,401.98 | 0.6508611 | 29,849,478.24 | 0.0000000 | ||||||||||||
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November 10, 2017 |
10,956,146.64 | 0.6300961 | 0.00 | 0.0000000 | ||||||||||||
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May 10, 2018 |
10,959,113.99 | 0.6093255 | 0.00 | 0.0000000 | ||||||||||||
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November 10, 2018 |
10,962,328.89 | 0.5885487 | 0.00 | 0.0000000 | ||||||||||||
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May 10, 2019 |
10,965,819.54 | 0.5677654 | 0.00 | 0.0000000 | ||||||||||||
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November 10, 2019 |
299,567,204.31 | 0.0000000 | 0.00 | 0.0000000 | ||||||||||||
Additional Information
The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer
and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Morgan Stanley toll-free at 1-866-718-1649, Goldman, Sachs & Co. at 1-866-471-2526 or Credit Suisse at 1-212-538-5441 (institutional investors)