Registration No. 333-_
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    FORM S-3
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                           --------------------------
                           CONTINENTAL AIRLINES, INC.
             (Exact name of registrant as specified in its charter)


         Delaware                         4512                    74-2099724
(State or other jurisdiction       (Primary standard           (I.R.S. employer 
jurisdiction of incorporation    industrial classification       identification
     or organization                   code number)                    number)


                                    2929 Allen Parkway
                                   Houston, Texas 77019
                                      (713) 324-5000
   (Address, including zip code, and telephone number, including area code, of
                   registrant's principal executive offices)
                  
                    -----------------------------------------


     Jeffery A. Smisek, Esq.                        Copies of correspondence to:
 Executive Vice President, General 
   Counsel and Secretary                                 John K. Hoyns, Esq.
     Continental Airlines, Inc.                      Hughes Hubbard & Reed LLP
  2929 Allen Parkway, Suite 2010                      One Battery Park Plaza
       Houston, Texas 77019                        New York, New York 10004-1482
          (713) 324-2950                           
(Name, address, including zip code, and 
  telephone number, including area code, 
   of agent for service)

                    -----------------------------------------
        Approximate date of commencement of proposed sale to the public:
     From time to time after this Registration Statement becomes effective.
                    -----------------------------------------


     If the only  securities  being  registered  on this Form are being  offered
pursuant to dividend or interest  reinvestment plans, please check the following
box. |_|

     If any of the securities  being registered on this Form are so offered on a
delayed or continuous  basis  pursuant to Rule 415 under the  Securities  Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|

     If this Form is filed to  register  additional  securities  for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list  the  Securities  Act  registration  statement  number  of the  earlier
effective registration statement for the same offering. |_|

     If this Form is a  post-effective  amendment  filed pursuant to Rule 462(c)
under the  Securities  Act,  check the following box and list the Securities Act
registration  statement number of the earlier effective  registration  statement
for the same offering. |_|

     If delivery of the  prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|

     Pursuant to Rule 429 of the Rules and  Regulations  of the  Securities  and
Exchange  Commission  under the Securities Act of 1933, as amended,  the form of
Prospectus included in this Registration  Statement also relates to an aggregate
remaining  amount of $138,282,000 of Pass Through  Certificates  covered by such
form of  Prospectus  previously  registered  under  the  Company's  Registration
Statement on Form S-3 (File No. 333-34545).


                                              (Continued on the following page.)



(Continued from the prior page.)

CALCULATION OF REGISTRATION FEE - ---------------------------------------- -------------- ----------------------- ------------------------ ---------------- Proposed Maximum Proposed Amount of Title of Each Class of Securities Amount to be Offering Price Maximum Aggregate Registration to be Registered Registered Per Unit Offering Price (1) Fee (2) ======================================== -------------- ----------------------- ------------------------ --------------- Pass Through Certificates $2,500,000,000 (3) $2,500,000,000 $737,500(4) ======================================== -------------- ----------------------- ------------------------ --------------- (1) Estimated solely for purposes of determining the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended. (2) Pursuant to Rule 457(o), the registration fee has been calculated on the basis of the maximum aggregate offering price of the securities listed. (3) Omitted pursuant to Rule 457(o). (4) A filing fee of $40,793 was previously paid in connection with the Pass Through Certificates included herein remaining from the Company's Registration Statement on Form S-3 (File No. 333-34545).
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. PROSPECTUS SUBJECT TO COMPLETION - DATED AUGUST 14, 1998 $2,500,000,000 CONTINENTAL AIRLINES, INC. PASS THROUGH CERTIFICATES -------------------------- Up to $2,500,000,000 aggregate public offering price of Pass Through Certificates (the "Certificates") (or its equivalent (based on the applicable exchange rate at the time of sale) in one or more foreign currencies or currency units) may be offered for sale from time to time pursuant to this Prospectus and related Prospectus Supplements (as defined below). Certificates may be issued in one or more series in amounts, at prices and on terms to be determined at the time of the offering. In respect of each offering of Certificates, a separate Continental Airlines Pass Through Trust for each series of Certificates being offered (each, a "Trust") will be formed pursuant to one or more Pass Through Trust Agreements (each, a "Basic Agreement") and one or more supplements thereto (each, a "Trust Supplement") relating to such Trust to be entered into between Continental Airlines, Inc. ("Continental" or the "Company") and the trustee named therein (the "Trustee"), as trustee under each Trust. Each Certificate in a series will represent a fractional undivided interest in the related Trust and will have no rights, benefits or interests in respect of any other Trust. The property of the Trusts will consist of equipment notes issued (a) on a nonrecourse basis by one or more owner trustees pursuant to separate leveraged lease transactions (the "Leased Aircraft Notes") to finance or refinance a portion of the equipment cost of aircraft, including engines (each, a "Leased Aircraft" and, collectively, the "Leased Aircraft"), which have been or will be leased to Continental pursuant to a separate lease agreement (each such lease agreement, a "Lease") for each Leased Aircraft, or (b) with recourse to Continental (the "Owned Aircraft Notes" and, together with any Leased Aircraft Notes, the "Equipment Notes") to finance or refinance all or a portion of the equipment cost of, or to purchase all or a portion of the outstanding debt with respect to, aircraft, including engines (each, an "Owned Aircraft" and, collectively, the "Owned Aircraft"; together with Leased Aircraft, the "Aircraft"), which have been or will be purchased and owned by Continental. To the extent that the proceeds of any offering of Certificates are not used to purchase Equipment Notes on the date of issuance of such Certificates, such proceeds will be held for the benefit of the holders of such Certificates. The specific terms of the particular Certificates in respect of which this Prospectus is being delivered will be set forth in a supplement to this Prospectus (the "Prospectus Supplement") which will be delivered together with this Prospectus, including, where applicable, the specific designation, form, aggregate principal amount, interest rate, final distribution date, ranking in respect of priority of payment, initial public offering price and distribution dates relating to such Certificates, the currency in which such Certificates will be payable, the Trust or Trusts relating to such Certificates, the Equipment Notes to be purchased by such Trust or Trusts, the Aircraft relating to such Equipment Notes, the leveraged lease transactions or financing arrangements, as the case may be, relating to such Equipment Notes and other special terms relating to such Certificates and the net proceeds from the offering of such Certificates. The Certificates shall be issued in registered form only and may, if so specified in the applicable Prospectus Supplement, be issued in accordance with a book-entry system. (Continued on the following page.) (Continued from the prior page.) With respect to one or more Aircraft, Equipment Notes may be issued, each of which may have a different interest rate, final maturity date and ranking in respect of priority of payment. For each series of Certificates, the Trustee will purchase one or more Equipment Notes issued with respect to one or more Aircraft such that all of the Equipment Notes held in the related Trust will have identical ranking and identical interest rates (in each case equal to the rate applicable to the Certificates issued by such Trust), and such that the latest maturity date for such Equipment Notes will occur on or before the final distribution date for such Certificates. Interest paid on the Equipment Notes held in each Trust will be passed through to the holders of the Certificates relating to such Trust on the dates and at the rate per annum set forth in the Prospectus Supplement relating to such Certificates until the final distribution date for such Trust, subject to the effect of any cross-subordination provisions described in the Prospectus Supplement for a series of Certificates. Principal paid on the Equipment Notes held in each Trust will be passed through to the holders of the Certificates relating to such Trust in scheduled amounts on the dates set forth in the Prospectus Supplement relating to such Certificates until the final distribution date for such Trust, subject to the effect of any cross-subordination provisions described in the Prospectus Supplement for a series of Certificates. The Equipment Notes issued with respect to any Aircraft will be secured by a security interest in such Aircraft and, in the case of the Leased Aircraft, by a security interest in the Lease relating thereto, including the right to receive rentals payable by Continental in respect of such Leased Aircraft. Although neither the Certificates nor the Leased Aircraft Notes will be direct obligations of, or guaranteed by, Continental, the amounts unconditionally payable by Continental for lease of Leased Aircraft will be sufficient to pay in full when due all payments required to be made on the corresponding Leased Aircraft Notes. The Certificates may be sold to or through underwriters, through dealers or agents or directly to purchasers. See "Plan of Distribution". The Prospectus Supplement will set forth the names of any underwriters, dealers or agents involved in the sale of the Certificates in respect of which this Prospectus is being delivered, the proposed amounts, if any, to be purchased by underwriters and the compensation, if any, of such underwriters or agents. See "Plan of Distribution" for information concerning secondary trading of the Certificates. THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF CERTIFICATES UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT. -------------------------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. -------------------------- The date of this Prospectus is ___________, 1998. INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION. AVAILABLE INFORMATION Continental has filed with the Securities and Exchange Commission (the "Commission") a Registration Statement on Form S-3 (together with all amendments, exhibits and schedules, the "Registration Statement") under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the Certificates offered hereby. This Prospectus does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission, and to which reference is hereby made. Statements made in this Prospectus as to the contents of any contract, agreement or other document referred to are not necessarily complete. With respect to each such contract, agreement or other document filed as an exhibit to the Registration Statement, reference is made to the exhibit for a more complete description of the matter involved. Continental is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files periodic reports and other information with the Commission. Such reports and other information, as well as the Registration Statement may be inspected at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, Room 1024, and at the regional offices of the Commission located at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and at 7 World Trade Center, 13th Floor, New York, New York 10048. Copies of such materials may be obtained from the Public Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. Such material may also be accessed electronically by means of the Commission's Internet web site (http://www.sec.gov), which contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission. In addition, reports, proxy statements and other information concerning Continental may be inspected and copied at the offices of the New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005. Continental is the successor to Continental Airlines Holdings, Inc. ("Holdings"), which merged with and into Continental on April 27, 1993. Holdings had also been subject to the informational requirements of the Exchange Act. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents filed with the Commission (File No. 0-9781) are hereby incorporated by reference in this Prospectus: (i) Continental's Annual Report on Form 10-K for the year ended December 31, 1997, filed on March 20, 1998, (ii) Continental's Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 1998, filed on May 7, 1998, and June 30, 1998, filed on August 14, 1998, and (iii) Continental's Current Reports on Form 8-K filed January 28, March 3, March 6, May 5 and July 30, 1998. All reports and any definitive proxy or information statements filed by Continental pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to the termination of the offering of the Certificates offered hereby shall be deemed to be incorporated by reference into this Prospectus and to be a part hereof from the respective dates of filing of such documents. Any statement contained in a document incorporated or deemed to be incorporated herein by reference, or contained in this Prospectus, shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein or contained in the Prospectus Supplement with respect to the Certificates modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. Continental will provide without charge to any person to whom a copy of this Prospectus has been delivered, upon written or oral request, a copy of any or all of the foregoing documents incorporated herein by reference (other than exhibits to such documents unless such exhibits are specifically incorporated by reference into such documents). Requests should be directed to Continental Airlines, Inc., 2929 Allen Parkway, Suite 2010, Houston, Texas 77019, Attention: Secretary, telephone (713) 324-2950. THE COMPANY Continental Airlines, Inc. is a major United States air carrier engaged in the business of transporting passengers, cargo and mail. Continental is the fifth largest United States airline (as measured by revenue passenger miles in the first seven months of 1998) and, together with its wholly-owned subsidiaries Continental Express, Inc. ("Express") and Continental Micronesia, Inc. ("CMI"), each a Delaware corporation, serves 206 airports worldwide as of August 1, 1998. The Company operates its route system primarily through domestic hubs at Newark, George Bush Intercontinental in Houston, Cleveland, and a Pacific hub on the island of Guam. Each of Continental's three domestic hubs is located in a large business and population center, contributing to a high volume of "origin and destination" traffic. The Guam hub is strategically located to provide service from Japanese and other Asian cities to popular resort destinations in the western Pacific. Continental is the primary carrier at each of these hubs, accounting for 59%, 80%, 52% and 79% of average daily jet departures, respectively, as of August 1, 1998. The Company is a Delaware corporation. Its executive offices are located at 2929 Allen Parkway, Suite 2010, Houston, Texas 77019, and its telephone number is (713) 324-2950. USE OF PROCEEDS Except as set forth in a Prospectus Supplement for a specific offering of Certificates, the Certificates will be issued in order to facilitate (a) the financing or refinancing of the debt portion and, in certain cases, the refinancing of some of the equity portion of one or more separate leveraged lease transactions entered into by Continental, as lessee, with respect to the Leased Aircraft as described in the applicable Prospectus Supplement, and (b) the financing or refinancing of the aggregate principal amount of debt to be issued, or the purchase of the aggregate principal amount of the debt previously issued, by Continental in respect of the Owned Aircraft as described in the applicable Prospectus Supplement. Except as set forth in a Prospectus Supplement for a specific offering of Certificates, the proceeds from the sale of the Certificates will be used by the Trustee on behalf of the applicable Trust or Trusts to purchase either (a) Leased Aircraft Notes issued by the respective Owner Trustee or Owner Trustees to finance or refinance (as specified in the applicable Prospectus Supplement) the related Leased Aircraft, or (b) Owned Aircraft Notes issued by Continental to finance or refinance (as specified in the applicable Prospectus Supplement) the related Owned Aircraft. To the extent that the proceeds of any offering of Certificates are not used to purchase Equipment Notes on the date of issuance of such Certificates, such proceeds will be held for the benefit of the holders of such Certificates. If any such proceeds are not subsequently utilized to purchase Equipment Notes by the relevant date specified in the applicable Prospectus Supplement, such proceeds will be returned to the holders of such Certificates. See "Description of Certificates--Delayed Purchase of Equipment Notes". The Leased Aircraft Notes will be issued under separate trust indentures (the "Leased Aircraft Indentures") between a bank, trust company or other institution specified in the related Prospectus Supplement, as trustee thereunder (in such capacity, herein referred to as the "Loan Trustee"), and an institution specified in the related Prospectus Supplement acting, not in its individual capacity, but solely as owner trustee (an "Owner Trustee") of a separate trust for the benefit of one or more institutional investors (each, an "Owner Participant"). With respect to each Leased Aircraft, the related Owner Participant will have provided or will provide from sources other than the Leased Aircraft Notes a portion of the equipment cost of the related Leased Aircraft. No Owner Participant, however, will be personally liable for any amount payable under the related Leased Aircraft Indenture or the Leased Aircraft Notes issued thereunder. Each Leased Aircraft will have been or will be leased by the related Owner Trustee to Continental pursuant to a separate Lease. The Owned Aircraft Notes will be issued under separate trust indentures (the "Owned Aircraft Indentures" and, together with any Leased Aircraft Indentures, the "Indentures") between the applicable Loan Trustee and Continental. RATIO OF EARNINGS TO FIXED CHARGES The following information for the period January 1, 1993 through April 27, 1993 relates to Continental's predecessor, Holdings. Information for the period April 28, 1993 through December 31, 1993, for the years ended December 31, 1994, 1995, 1996 and 1997 and for the three and six months ended June 30, 1997 and 1998 relates to Continental. The information as to Continental has not been prepared on a consistent basis of accounting with the information as to Holdings due to Continental's adoption, effective April 27, 1993, of fresh start reporting in accordance with the American Institute of Certified Public Accountants' Statement of Position 90-7 -- "Financial Reporting by Entities in Reorganization Under the Bankruptcy Code" ("SOP 90-7"). For the periods January 1, 1993 through April 27, 1993 and April 28, 1993 through December 31, 1993 and for the year ended December 31, 1994, earnings were not sufficient to cover fixed charges. Additional earnings of $979 million, $60 million and $667 million, respectively, would have been required to achieve ratios of earnings to fixed charges of 1.0. The ratio of earnings to fixed charges for the years ended December 31, 1995, 1996 and 1997 was 1.53, 1.81 and 2.07, respectively. The ratio of earnings to fixed charges for the three months ended June 30, 1997 and 1998 was 2.48 and 2.66, respectively, and for the six months ended June 30, 1997 and 1998 was 2.18 and 2.26, respectively. For purposes of calculating this ratio, earnings consist of earnings before taxes, minority interest and extraordinary items plus interest expense (net of capitalized interest), the portion of rental expense representative of interest expense and amortization of previously capitalized interest. Fixed charges consist of interest expense and the portion of rental expense representative of interest expense. GENERAL OUTLINE OF TRUST STRUCTURE In respect of each offering of Certificates, one or more Trusts will be formed, and the related Certificates issued, pursuant to separate Trust Supplements to be entered into between the Trustee and Continental in accordance with the terms of the Basic Agreement. Concurrently with the execution and delivery of each Trust Supplement, the Trustee, on behalf of the Trust formed thereby, will enter into one or more purchase or refunding agreements (each such agreement being herein referred to as a "Note Purchase Agreement") pursuant to which it will agree to purchase one or more Equipment Notes relating to one or more of the Aircraft described in the applicable Prospectus Supplement. Pursuant to the applicable Note Purchase Agreement or Note Purchase Agreements, the Trustee, on behalf of each Trust, will purchase one or more Equipment Notes such that the Equipment Notes that constitute the property of such Trust will have identical interest rates (in each case equal to the rate applicable to the Certificates issued by such Trust) and identical priority of payment relative to each of the other Equipment Notes issued under the Related Indentures (as defined below). The maturity dates of the Equipment Notes acquired by each Trust will occur on or before the final distribution date applicable to the Certificates that will be issued by such Trust. The Trustee will distribute the amount of payments of principal, premium, if any, and interest received by it as holder of the Equipment Notes to the registered holders of Certificates of the Trust (the "Certificateholders") in which such Equipment Notes are held, subject to the effect of any cross-subordination provisions described in the Prospectus Supplement for a series of Certificates. To the extent that the proceeds of any offering of Certificates are not used to purchase Equipment Notes on the date of issuance of such Certificates, such proceeds will be held for the benefit of the holders of such Certificates. If any such proceeds are not subsequently utilized to purchase Equipment Notes by the relevant date specified in the applicable Prospectus Supplement, such proceeds will be returned to the holders of such Certificates. See "Description of the Certificates" and "Description of the Equipment Notes". DESCRIPTION OF THE CERTIFICATES In connection with each offering of Certificates, one or more separate Trusts will be formed and one or more series of Certificates will be issued pursuant to the Basic Agreement and one or more separate Trust Supplements to be entered into between Continental and the Trustee. The statements made under this caption are summaries and reference is made to the detailed provisions of the Basic Agreement, the form of which has been filed as an exhibit to the Registration Statement of which this Prospectus is a part. The summaries relate to the Basic Agreement and each of the Trust Supplements, the Trusts to be formed thereby and the Certificates to be issued by each Trust except to the extent, if any, described in the applicable Prospectus Supplement. The Prospectus Supplement that accompanies this Prospectus contains a glossary of the material terms used with respect to the specific series of Certificates being offered thereby. The Trust Supplement relating to each series of Certificates and the forms of the related Note Purchase Agreement, Indenture, Lease, Trust Agreement, Participation Agreement, intercreditor agreement and liquidity facility arrangement, as applicable, will be filed as exhibits to a post-effective amendment to the Registration Statement of which this Prospectus is a part, a Current Report on Form 8-K, a Quarterly Report on Form 10-Q or an Annual Report on Form 10-K, as applicable, filed by Continental with the Commission. The Certificates offered pursuant to this Prospectus will be limited to $2,500,000,000 aggregate public offering price (or its equivalent (based on the applicable exchange rate at the time of sale) in one or more foreign currencies or currency units). To the extent that any provision in any Prospectus Supplement is inconsistent with any provision in this summary, the provision of such Prospectus Supplement will control. General Each Certificate will represent a fractional undivided interest in the Trust created by the Trust Supplement pursuant to which such Certificate was issued and all payments and distributions shall be made only from the related Trust Property (as defined below). The property of each Trust (the "Trust Property") will include (i) the Equipment Notes held in such Trust and all monies at any time paid thereon and all monies due and to become due thereunder, subject to the effect of any cross-subordination provisions described in the Prospectus Supplement for a series of Certificates, (ii) funds from time to time deposited with the Trustee in accounts relating to such Trust and (iii) if so specified in the Prospectus Supplement related to a series of Certificates, rights under intercreditor agreements relating to cross-subordination arrangements and monies receivable under a liquidity facility. Each Certificate will represent a pro rata share of the outstanding principal amount of the Equipment Notes held in the related Trust and, unless otherwise specified in the applicable Prospectus Supplement, will be issued in minimum denominations of $1,000 or any integral multiple thereof except that one Certificate of each series may be issued in a different denomination. The Certificates do not represent an interest in or obligation of Continental, the Trustee, any of the Loan Trustees or Owner Trustees in their individual capacities, any Owner Participant, or any affiliate of any thereof. Each Certificateholder by its acceptance of a Certificate agrees to look solely to the income and proceeds from the Trust Property as provided in the Basic Agreement and the applicable Trust Supplement. The Equipment Notes issued under an Indenture may be held in more than one Trust and one Trust may hold Equipment Notes issued under more than one Indenture (each Indenture the Equipment Notes of which are held in a Trust, a "Related Indenture"). Unless otherwise provided in a Prospectus Supplement, only Equipment Notes having the same priority of payment (the Equipment Notes of any such priority, a "Class") may be held in the same Trust. Interest will be passed through to Certificateholders of each Trust at the rate per annum payable on the Equipment Notes held in such Trust, as set forth for such Trust on the cover page of the applicable Prospectus Supplement, subject to the effect of any cross-subordination provisions described in the Prospectus Supplement for a series of Certificates. Reference is made to the Prospectus Supplement that accompanies this Prospectus for a description of the specific series of Certificates being offered thereby, including: (1) the specific designation and title of such Certificates; (2) the Regular Distribution Dates (as defined below) and Special Distribution Dates (as defined below) applicable to such Certificates; (3) the currency or currencies (including currency units) in which such Certificates may be denominated; (4) the specific form of such Certificates, including whether or not such Certificates are to be issued in accordance with a book-entry system; (5) a description of the Equipment Notes to be purchased by such Trust, including (a) the period or periods within which, the price or prices at which, and the terms and conditions upon which such Equipment Notes may or must be redeemed or defeased in whole or in part, by Continental or, with respect to Leased Aircraft Notes, the Owner Trustee, (b) the payment priority of such Equipment Notes in relation to any other Equipment Notes issued with respect to the related Aircraft, (c) any additional security or liquidity enhancements therefor and (d) any intercreditor or other rights or limitations between or among the holders of Equipment Notes of different priorities issued with respect to the same Aircraft; (6) a description of the related Aircraft; (7) a description of the related Note Purchase Agreement and Related Indentures, including a description of the events of default under the Related Indentures, the remedies exercisable upon the occurrence of such events of default and any limitations on the exercise of such remedies with respect to such Equipment Notes; (8) if such Certificates relate to Leased Aircraft, a description of the related Leases, Trust Agreements and Participation Agreements, including (a) the names of the related Owner Trustees, (b) a description of the events of default under the related Leases, the remedies exercisable upon the occurrence of such events of default and any limitations on the exercise of such remedies with respect to such Leased Aircraft Notes, and (c) the rights of the related Owner Trustee, if any, and/or Owner Participant, if any, to cure failures of Continental to pay rent under the related Lease; (9) the extent, if any, to which the provisions of the operative documents applicable to such Equipment Notes may be amended by the parties thereto without the consent of the holders of, or only upon the consent of the holders of a specified percentage of aggregate principal amount of, such Equipment Notes; (10) cross-default or cross-collateralization provisions in the Related Indentures, if any; (11) subordination provisions among the holders of Certificates, including any cross-subordination provisions among the holders of Certificates in separate Trusts; and (12) any other special terms pertaining to such Certificates. If any Certificates are denominated in one or more foreign currencies or currency units, the restrictions, certain United States federal income tax considerations, specific terms and other information with respect to such Certificates and such foreign currency or currency units will be set forth in the applicable Prospectus Supplement. Book-Entry Registration General If specified in the applicable Prospectus Supplement, the Certificates will be subject to the provisions described below and under the caption "--Definitive Certificates". Upon issuance, each series of Certificates will be represented by one or more fully registered global certificates. Unless otherwise provided in a Prospectus Supplement, each global certificate will be deposited with, or on behalf of, The Depository Trust Company ("DTC") and registered in the name of CEDE & Co. ("Cede"), the nominee of DTC. No person acquiring an interest in such Certificates ("Certificate Owner") will be entitled to receive a certificate representing such person's interest in such Certificates, except as set forth below under "--Definitive Certificates". Unless and until Definitive Certificates are issued under the limited circumstances described herein, all references to actions by Certificateholders shall refer to actions taken by DTC upon instructions from DTC Participants (as defined below), and all references herein to distributions, notices, reports and statements to Certificateholders shall refer, as the case may be, to distributions, notices, reports and statements to DTC or Cede, as the registered holder of such Certificates, or to DTC Participants for distribution to Certificate Owners in accordance with DTC procedures. DTC is a limited purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code and "clearing agency" registered pursuant to section 17A of the Exchange Act. DTC was created to hold securities for its participants ("DTC Participants") and to facilitate the clearance and settlement of securities transactions between DTC Participants through electronic book-entries, thereby eliminating the need for physical transfer of certificates. DTC Participants include securities brokers and dealers, banks, trust companies and clearing corporations. Indirect access to the DTC system also is available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a DTC Participant either directly or indirectly ("Indirect Participants"). Certificate Owners that are not DTC Participants or Indirect Participants but desire to purchase, sell or otherwise transfer ownership of, or other interests in, the Certificates may do so only through DTC Participants and Indirect Participants. In addition, Certificate Owners will receive all distributions of principal and interest from the Trustee through DTC Participants or Indirect Participants, as the case may be. Under a book-entry format, Certificate Owners may experience some delay in their receipt of payments, because such payments will be forwarded by the Trustee to Cede, as nominee for DTC. DTC will forward such payments in same-day funds to DTC Participants who are credited with ownership of the Certificates in amounts proportionate to the principal amount of each such DTC Participant's respective holdings of beneficial interests in the Certificates. DTC Participants will thereafter forward payments to Indirect Participants or Certificate Owners, as the case may be, in accordance with customary industry practices. The forwarding of such distributions to the Certificate Owners will be the responsibility of such DTC Participants. Unless and until the Definitive Certificates are issued under the limited circumstances described herein, the only "Certificateholder" will be Cede, as nominee of DTC. Certificate Owners will not be recognized by the Trustee as Certificateholders, as such term is used in the Basic Agreement, and Certificate Owners will be permitted to exercise the rights of Certificateholders only indirectly through DTC and DTC Participants. Under the rules, regulations and procedures creating and affecting DTC and its operations (the "Rules"), DTC is required to make book-entry transfers of the Certificates among DTC Participants on whose behalf it acts with respect to the Certificates and to receive and transmit distributions of principal, premium, if any, and interest with respect to the Certificates. DTC Participants and Indirect Participants with which Certificate Owners have accounts with respect to the Certificates similarly are required to make book-entry transfers and receive and transmit such payments on behalf of their respective customers. Accordingly, although Certificate Owners will not possess the Certificates, the Rules provide a mechanism by which Certificate Owners will receive payments and will be able to transfer their interests. Because DTC can only act on behalf of DTC Participants, who in turn act on behalf of Indirect Participants, the ability of a Certificate Owner to pledge the Certificates to persons or entities that do not participate in the DTC system, or to otherwise act with respect to such Certificates, may be limited due to the lack of a physical certificate for such Certificates. DTC will take any action permitted to be taken by a Certificateholder under the Basic Agreement only at the direction of one or more DTC Participants to whose accounts with DTC the Certificates are credited. Additionally, in the event any action requires approval by Certificateholders of a certain percentage of beneficial interest in each Trust, DTC will take such action only at the direction of and on behalf of DTC Participants whose holdings include undivided interests that satisfy any such percentage. DTC may take conflicting actions with respect to other undivided interests to the extent that such actions are taken on behalf of DTC Participants whose holdings include such undivided interests. Neither Continental nor the Trustee will have any liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in the Certificates held by Cede, as nominee for DTC, or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. The applicable Prospectus Supplement will specify any additional book-entry registration procedures applicable to Certificates denominated in a currency other than United States dollars. Same-Day Settlement and Payment So long as the Certificates are registered in the name of DTC or its nominee, all payments made by Continental to the Loan Trustee under any Lease or any Owned Aircraft Indenture will be in immediately available funds. Such payments, including the final distribution of principal with respect to the Certificates of any Trust, will be passed through to DTC in immediately available funds. Any Certificates registered in the name of DTC or its nominee, will trade in DTC's Same-Day Funds Settlement System until maturity, and secondary market trading activity in the Certificates will therefore be required by DTC to settle in immediately available funds. No assurance can be given as to the effect, if any, of settlement in same-day funds on trading activity in the Certificates. Definitive Certificates Certificates will be issued in certificated form ("Definitive Certificates") to Certificate Owners or their nominees, rather than to DTC or its nominee, only if (i) Continental advises the Trustee in writing that DTC is no longer willing or able to discharge properly its responsibilities as depository with respect to such Certificates and Continental is unable to locate a qualified successor, (ii) Continental, at its option, elects to terminate the book-entry system through DTC or (iii) after the occurrence of certain events of default or other events specified in the related Prospectus Supplement, Certificate Owners with fractional undivided interests aggregating not less than a majority in interest in such Trust advise the Trustee, Continental and DTC through DTC Participants in writing that the continuation of a book-entry system through DTC (or a successor thereto) is no longer in the Certificate Owners' best interest. Upon the occurrence of any event described in the immediately preceding sentence, the Trustee will be required to notify all Certificate Owners through DTC Participants of the availability of Definitive Certificates. Upon surrender by DTC of the certificates representing the Certificates and receipt of instructions for re-registration, the Trustee will reissue the Certificates as Definitive Certificates to Certificate Owners. Distributions of principal, premium, if any, and interest with respect to Certificates will thereafter be made by the Trustee directly in accordance with the procedures set forth in the Basic Agreement and the applicable Trust Supplements, to holders in whose names the Definitive Certificates were registered at the close of business on the applicable record date. Such distributions will be made by check mailed to the address of such holder as it appears on the register maintained by the Trustee. The final payment on any Certificate, however, will be made only upon presentation and surrender of such Certificate at the office or agency specified in the notice of final distribution to Certificateholders. Definitive Certificates will be freely transferable and exchangeable at the office of the Trustee upon compliance with the requirements set forth in the Basic Agreement and the applicable Trust Supplements. No service charge will be imposed for any registration of transfer or exchange, but payment of a sum sufficient to cover any tax or other governmental charge shall be required. Payments and Distributions Subject to the effect of any cross-subordination provisions set forth in the Prospectus Supplement for a series of Certificates, payments of principal, premium, if any, and interest with respect to the Equipment Notes held in each Trust will be distributed by the Trustee, upon receipt, to Certificateholders of such Trust on the dates and in the currency specified in the applicable Prospectus Supplement, except in certain cases when some or all of such Equipment Notes are in default as described in the applicable Prospectus Supplement. Payments of principal of, and interest on, the unpaid principal amount of the Equipment Notes held in each Trust will be scheduled to be received by the Trustee on the dates specified in the applicable Prospectus Supplement (such scheduled payments of interest and principal on the Equipment Notes to the Trustee are herein referred to as "Scheduled Payments", and the dates specified in the applicable Prospectus Supplement for distribution of Scheduled Payments to the Trustee are herein referred to as "Regular Distribution Dates"). See "Description of the Equipment Notes--General". Subject to the effect of any cross-subordination provisions set forth in the Prospectus Supplement for a series of Certificates, each Certificateholder of each Trust will be entitled to receive a pro rata share of any distribution in respect of Scheduled Payments of principal and interest made on the Equipment Notes held in the Trust. Payments of principal, premium, if any, and interest received by the Trustee on account of the early redemption, if any, of the Equipment Notes relating to one or more Aircraft held in a Trust, and payments, other than Scheduled Payments received on a Regular Distribution Date or within five days thereafter, received by the Trustee following default in respect of Equipment Notes held in a Trust relating to one or more Aircraft ("Special Payments") will be distributed on the date determined as described in the applicable Prospectus Supplement (a "Special Distribution Date") except that, if specified in the applicable Prospectus Supplement, payments received by the Trustee following default in respect of the Equipment Notes on a Regular Distribution Date as a result of a drawing under any liquidity facility, as described in the applicable Prospectus Supplement (each, a "Liquidity Facility"), provided for the benefit of the specified Certificateholders shall be distributed on such Regular Distribution Date to such Certificateholders. The Trustee will mail notice to the Certificateholders of record of the applicable Trust stating any such anticipated Special Distribution Date. Pool Factors Unless otherwise described in the applicable Prospectus Supplement, the "Pool Balance" for each Trust or for the Certificates issued by any Trust indicates, as of any date, the original aggregate face amount of the Certificates of such Trust less the aggregate amount of all payments made in respect of the Certificates of such Trust other than payments made in respect of interest or premium thereon or reimbursement of any costs and expenses in connection therewith. The Pool Balance for each Trust as of any Regular Distribution Date or Special Distribution Date shall be computed after giving effect to the payment of principal, if any, on the Equipment Notes or other Trust Property held in such Trust and the distribution thereof to be made on that date. Unless otherwise described in the applicable Prospectus Supplement, the "Pool Factor" for each Trust as of any Regular Distribution Date or Special Distribution Date is the quotient (rounded to the seventh decimal place) computed by dividing (i) the Pool Balance by (ii) the aggregate original face amount of the Certificates of such Trust. The Pool Factor for each Trust as of any Regular Distribution Date or Special Distribution Date shall be computed after giving effect to the payment of principal, if any, on the Equipment Notes or other Trust Property held in such Trust and distribution thereof to be made on that date. The Pool Factor for each Trust will initially be 1.0000000; thereafter, the Pool Factor for each Trust will decline as described herein to reflect reductions in the Pool Balance of such Trust. The amount of a Certificateholder's pro rata share of the Pool Balance of a Trust can be determined by multiplying the original denomination of the holder's Certificate of such Trust by the Pool Factor for such Trust as of the applicable Regular Distribution Date or Special Distribution Date. The Pool Factor and the Pool Balance for each Trust will be mailed to Certificateholders of such Trust on each Regular Distribution Date and Special Distribution Date. Unless there has been an early redemption, a purchase of an issue of Equipment Notes by the related Owner Trustee after an Indenture Default (as defined below), a default in the payment of principal in respect of one or more issues of the Equipment Notes held in a Trust or certain actions have been taken following a default thereon, as described in the applicable Prospectus Supplement, the Pool Factor for the Trusts will decline in proportion to the scheduled repayments of principal on the Equipment Notes held in such Trust as described in the applicable Prospectus Supplement. In the event of such redemption, purchase or default, the Pool Factor and the Pool Balance of each Trust so affected will be recomputed after giving effect thereto and notice thereof will be mailed to the Certificateholders of such Trust. Each Trust will have a separate Pool Factor. Reports to Certificateholders On each Regular Distribution Date and Special Distribution Date, the Trustee will include with each distribution of a Scheduled Payment or Special Payment to Certificateholders of the related Trust a statement, giving effect to such distribution to be made on such Regular Distribution Date or Special Distribution Date, setting forth the following information (per $1,000 aggregate principal amount of Certificate for such Trust, as to (i) and (ii) below): (i) the amount of such distribution allocable to principal and the amount allocable to premium, if any; (ii) the amount of such distribution allocable to interest; and (iii) the Pool Balance and the Pool Factor for such Trust. So long as the Certificates are registered in the name of DTC or its nominee, on the record date prior to each Regular Distribution Date and Special Distribution Date, the Trustee will request from DTC a securities position listing setting forth the names of all DTC Participants reflected on DTC's books as holding interests in the Certificates on such record date. On each Regular Distribution Date and Special Distribution Date, the applicable Trustee will mail to each such DTC Participant the statement described above and will make available additional copies as requested by such DTC Participant for forwarding to Certificate Owners. In addition, after the end of each calendar year, the Trustee will prepare for each Certificateholder of each Trust at any time during the preceding calendar year a report containing the sum of the amounts determined pursuant to clauses (i) and (ii) above with respect to the Trust for such calendar year or, in the event such person was a Certificateholder during only a portion of such calendar year, for the applicable portion of such calendar year, and such other items as are readily available to the Trustee and which a Certificateholder shall reasonably request as necessary for the purpose of such Certificateholder's preparation of its federal income tax returns. Such report and such other items shall be prepared on the basis of information supplied to the Trustee by the DTC Participants and shall be delivered by the Trustee to such DTC Participants to be available for forwarding by such DTC Participants to Certificate Owners in the manner described above. At such time, if any, as the Certificates are issued in the form of Definitive Certificates, the Trustee will prepare and deliver the information described above to each Certificateholder of record of each Trust as the name and period of ownership of such Certificateholder appears on the records of the registrar of the Certificates. Voting of Equipment Notes Subject to the effect of any cross-subordination provisions set forth in the related Prospectus Supplement, the Trustee, as holder of the Equipment Notes held in each Trust, has the right to vote and give consents and waivers with respect to such Equipment Notes under the Related Indentures. The Basic Agreement and related Trust Supplement set forth (i) the circumstances in which the Trustee may direct any action or cast any vote as the holder of the Equipment Notes held in the applicable Trust at its own discretion, (ii) the circumstances in which the Trustee shall seek instructions from the Certificateholders of such Trust and (iii) the percentage of Certificateholders required to direct the Trustee to take any such action. If specified in the related Prospectus Supplement, the right of a Trustee to vote and give consents and waivers with respect to the Equipment Notes held in the related Trust may, in the circumstances set forth in an intercreditor agreement to be executed by such Trustee, be exercisable by another person specified in such Prospectus Supplement. Events of Default and Certain Rights upon an Event of Default The Prospectus Supplement will specify the events of default under the Basic Agreement (an "Event of Default") and the Related Indentures (an "Indenture Default"). The Indenture Defaults in the case of Leased Aircraft Indentures will include events of default under the related Leases (a "Lease Event of Default"). With respect to any Equipment Notes which are supported by a Liquidity Facility, the Indenture Defaults or Events of Default may include events of default under such Liquidity Facility. Unless otherwise provided in a Prospectus Supplement, all of the Equipment Notes issued under the same Indenture will relate to a specific Aircraft and there will be no cross-collateralization or cross-default provisions in the Indentures, and events resulting in an Indenture Default under any particular Indenture will not necessarily result in an Indenture Default occurring under any other Indenture. If an Indenture Default occurs in fewer than all of the Indentures, notwithstanding the treatment of Equipment Notes issued under any Indenture under which an Indenture Default has occurred, payments of principal and interest on the Equipment Notes issued pursuant to Indentures with respect to which an Indenture Default has not occurred will continue to be made as originally scheduled. As described below under "--Cross-Subordination Issues", a Prospectus Supplement may provide the terms of any cross-subordination provisions among Certificateholders of separate Trusts. If such provisions are so provided, payments made pursuant to a Related Indenture under which an Indenture Default has not occurred may be distributed first to the holders of the Certificates issued under the Trust which holds the most senior Equipment Notes issued under all Related Indentures. The ability of the applicable Owner Trustee or Owner Participant under a Leased Aircraft Indenture to cure Indenture Defaults, including an Indenture Default that results from the occurrence of a Lease Event of Default under the related Lease, will be described in the Prospectus Supplement. Unless otherwise provided in a Prospectus Supplement, with respect to any Certificates or Equipment Notes entitled to the benefits of a Liquidity Facility, a drawing under any such Liquidity Facility for the purpose of making a payment of interest as a result of the failure by Continental to have made a corresponding payment will not cure an Indenture Default related to such failure by Continental. The Prospectus Supplement related to a series of Certificates will describe the circumstances under which the Trustee of the related Trust may vote some or all of the Equipment Notes held in such Trust. Such Prospectus Supplement also will set forth the percentage of Certificateholders of such Trust entitled to direct the Trustee to take any action with respect to such Equipment Notes. If the Equipment Notes outstanding under an Indenture are held by more than one Trust, then the ability of the Certificateholders issued with respect to any one Trust to cause the Loan Trustee with respect to any Equipment Notes held in such Trust to accelerate the Equipment Notes under the applicable Indenture or to direct the exercise of remedies by the Loan Trustee under the applicable Indenture will depend, in part, upon the proportion of the aggregate principal amount of the Equipment Notes outstanding under such Indenture and held in such Trust to the aggregate principal amount of all Equipment Notes outstanding under such Indenture. In addition, if cross-subordination provisions are applicable to any series of Certificates, then the ability of the Certificateholders of any one Trust holding Equipment Notes issued under an Indenture to cause the Loan Trustee with respect to any Equipment Notes held in such Trust to accelerate the Equipment Notes under such Indenture or to direct the exercise of remedies by the Loan Trustee under such Indenture will depend, in part, upon the Class of Equipment Notes held in such Trust. If the Equipment Notes outstanding under an Indenture are held by more than one Trust, then each Trust will hold Equipment Notes with different terms from the Equipment Notes held in the other Trusts and therefore the Certificateholders of each Trust may have divergent or conflicting interests from those of the Certificateholders of the other Trusts holding Equipment Notes issued under the same Indenture. In addition, so long as the same institution acts as Trustee of each Trust, in the absence of instructions from the Certificateholders of any such Trust, the Trustee for such Trust could for the same reason be faced with a potential conflict of interest upon an Indenture Default. In such event, the Trustee has indicated that it would resign as Trustee of one or all such Trusts, and a successor trustee would be appointed in accordance with the terms of the Basic Agreement. The Prospectus Supplement for a series of Certificates will specify whether and under what circumstances the Trustee may sell for cash to any person all or part of the Equipment Notes held in the related Trust. Any proceeds received by the Trustee upon any such sale shall be deposited in an account established by the Trustee for the benefit of the Certificateholders of such Trust for the deposit of such Special Payments (the "Special Payments Account") and shall be distributed to the Certificateholders of such Trust on a Special Distribution Date. The market for Equipment Notes in default may be very limited, and there can be no assurance that they could be sold for a reasonable price. Furthermore, so long as the same institution acts as Trustee of multiple Trusts, it may be faced with a conflict in deciding from which Trust to sell Equipment Notes to available buyers. If the Trustee sells any such Equipment Notes with respect to which an Indenture Default exists for less than their outstanding principal amount, the Certificateholders of such Trust will receive a smaller amount of principal distributions than anticipated and will not have any claim for the shortfall against Continental, any Owner Trustee, Owner Participant or the Trustee. Furthermore, neither the Trustee nor the Certificateholders of such Trust could take any action with respect to any remaining Equipment Notes held in such Trust so long as no Indenture Defaults exist with respect thereto. Any amount, other than Scheduled Payments received on a Regular Distribution Date, distributed to the Trustee of any Trust by the Loan Trustee under any Indenture on account of the Equipment Notes held in such Trust following an Indenture Default under such Indenture shall be deposited in the Special Payments Account for such Trust and shall be distributed to the Certificateholders of such Trust on a Special Distribution Date. In addition, if a Prospectus Supplement provides that the applicable Owner Trustee may, under circumstances specified therein, redeem or purchase the outstanding Equipment Notes issued under the applicable Indenture, the price paid by such Owner Trustee to the Trustee of any Trust for the Equipment Notes issued under such Indenture and held in such Trust shall be deposited in the Special Payments Account for such Trust and shall be distributed to the Certificateholders of such Trust on a Special Distribution Date. Any funds representing payments received with respect to any Equipment Notes in default held in a Trust, or the proceeds from the sale by the Trustee of any such Equipment Notes, held by the Trustee in the Special Payments Account for such Trust shall, to the extent practicable, be invested and reinvested by the Trustee in Permitted Investments pending the distribution of such funds on a Special Distribution Date. "Permitted Investments" will be specified in the related Prospectus Supplement. The Basic Agreement provides that the Trustee of each Trust shall, within 90 days after the occurrence of a default in respect of such Trust, give to the Certificateholders of such Trust notice, transmitted by mail, of all uncured or unwaived defaults with respect to such Trust known to it, provided that, except in the case of default in the payment of principal, premium, if any, or interest on any of the Equipment Notes held in such Trust, the Trustee shall be protected in withholding such notice if it in good faith determines that the withholding of such notice is in the interests of such Certificateholders. The term "default" as used in this paragraph only means the occurrence of an Indenture Default with respect to Equipment Notes held in a Trust as described above, except that in determining whether any such Indenture Default has occurred, any grace period or notice in connection therewith shall be disregarded. The Basic Agreement contains a provision entitling the Trustee of each Trust, subject to the duty of the Trustee during a default to act with the required standard of care, to be offered reasonable security or indemnity by the Certificateholders of such Trust before proceeding to exercise any right or power under the Basic Agreement at the request of such Certificateholders. The Prospectus Supplement for a series of Certificates will specify the percentage of Certificateholders entitled to waive, or to instruct the Trustee to waive, any past Event of Default with respect to such Trust and its consequences. The Prospectus Supplement for a series of Certificates also will specify the percentage of Certificateholders (and whether of such Trust or of any other Trust holding Equipment Notes issued under Related Indentures) entitled to waive, or to instruct the Trustee or the Loan Trustee to waive, any past Indenture Default under any Related Indenture and thereby annul any direction given with respect thereto. Merger, Consolidation and Transfer of Assets Continental will be prohibited from consolidating with or merging into any other corporation or transferring substantially all of its assets as an entirety to any other corporation unless (i) the surviving, successor or transferee corporation shall (a) be validly existing under the laws of the United States or any state thereof, (b) be a "citizen of the United States" (as defined in Title 49 of the United States Code relating to aviation (the "Transportation Code")) holding an air carrier operating certificate issued by the Secretary of Transportation pursuant to Chapter 447 of Title 49, United States Code, if, and so long as, such status is a condition of entitlement to the benefits of Section 1110 of the Bankruptcy Code, and (c) expressly assume all of the obligations of Continental contained in the Basic Agreement and any Trust Supplement, the Note Purchase Agreements, any Owned Aircraft Indentures and, with respect to the Leased Aircraft, the applicable Participation Agreements and Leases, and any other operative documents; and (ii) Continental shall have delivered a certificate and an opinion or opinions of counsel indicating that such transaction, in effect, complies with such conditions. Modifications of the Basic Agreement The Basic Agreement contains provisions permitting Continental and the Trustee of each Trust to enter into a supplemental trust agreement, without the consent of the holders of any of the Certificates of such Trust, including among other things (i) to provide for the formation of such Trust and the issuance of a series of Certificates, (ii) to evidence the succession of another corporation to Continental and the assumption by such corporation of Continental's obligations under the Basic Agreement and the applicable Trust Supplement, (iii) to add to the covenants of Continental for the benefit of holders of such Certificates, or to surrender any right or power in the Basic Agreement conferred upon Continental, (iv) to cure any ambiguity or correct or supplement any defective or inconsistent provision of the Basic Agreement or the applicable Trust Supplement or to make any other provisions with respect to matters or questions arising thereunder, provided such action shall not materially adversely affect the interests of the holders of such Certificates, or to cure any ambiguity or correct any mistake or (without limitation of the foregoing), to give effect or provide for replacement liquidity facilities, if applicable to such Certificates, (v) to comply with any requirement of the Commission, any applicable law, rules or regulations of any exchange or quotation system on which any Certificates may be listed or of any regulatory body, (vi) to modify, eliminate or add to the provisions of the Basic Agreement to the extent as shall be necessary to continue the qualification of the Basic Agreement (including any supplemental agreement) under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and to add to the Basic Agreement such other provisions as may be expressly permitted by the Trust Indenture Act, (vii) to provide for a successor Trustee or to add to or change any provision of the Basic Agreement as shall be necessary to facilitate the administration of the Trusts thereunder by more than one Trustee and (viii) to make any other amendments or modifications to the Basic Agreement, provided such amendments or modifications shall only apply to Certificates issued thereafter; provided, in the case of clauses (i) through (viii) above, that no such supplemental trust agreement shall adversely affect the status of any Trust as a grantor trust for U.S. federal income tax purposes. The Basic Agreement also contains provisions permitting Continental and the Trustee of each Trust, with the consent of the Certificateholders of such Trust evidencing fractional undivided interests aggregating not less than a majority in interest of such Trust, and, with respect to any Leased Aircraft, with the consent of the applicable Owner Trustee (such consent not to be unreasonably withheld), to execute supplemental trust agreements adding any provisions to or changing or eliminating any of the provisions of the Basic Agreement, to the extent relating to such Trust, and the applicable Trust Supplement, or modifying the rights of the Certificateholders, except that no such supplemental trust agreement may, without the consent of each Certificateholder so affected thereby, (a) reduce in any manner the amount of, or delay the timing of, any receipt by the Trustee of payments on the Equipment Notes held in such Trust or distributions in respect of any Certificate related to such Trust, or change the date or place of any payment in respect of any Certificate, or make distributions payable in coin or currency other than that provided for in such Certificates, or impair the right of any Certificateholder of such Trust to institute suit for the enforcement of any such payment when due, (b) permit the disposition of any Equipment Note held in such Trust, except as provided in the Basic Agreement or the applicable Trust Supplement, or otherwise deprive any Certificateholder of the benefit of the ownership of the applicable Equipment Notes, (c) reduce the percentage of the aggregate fractional undivided interests of the Trust provided for in the Basic Agreement or the applicable Trust Supplement, the consent of the holders of which is required for any such supplemental trust agreement or for any waiver provided for in the Basic Agreement or such Trust Supplement, (d) modify any of the provisions relating to the rights of the Certificateholders in respect of the waiver of events of default or receipt of payment, (e) alter the priority of distributions specified in any applicable intercreditor agreement in a manner materially adverse to the interests of the Certificateholders of such Trust or (f) adversely affect the status of any Trust as a grantor trust for U.S. federal income tax purposes. Modification of Indenture and Related Agreements The Prospectus Supplement will specify the Trustee's obligations in the event that the Trustee, as the holder of any Equipment Notes held in a Trust, receives a request for its consent to any amendment, modification or waiver under the Indenture or other documents relating to such Equipment Notes (including any Lease with respect to Leased Aircraft Notes) or any Liquidity Facility. Cross-Subordination Issues The Equipment Notes issued under an Indenture may be held in more than one Trust and one Trust may hold Equipment Notes issued under more than one Related Indenture. Unless otherwise provided in a Prospectus Supplement, only Equipment Notes of the same Class may be held in the same Trust. In such event, payments made on account of a subordinate class of Certificates issued under a Prospectus Supplement may, under circumstances described in such Prospectus Supplement, be subordinated to the prior payment of all amounts owing to Certificateholders of a Trust which holds senior Equipment Notes issued under any Related Indentures. The Prospectus Supplement related to an issuance of Certificates will describe any such "cross-subordination" provisions and any related terms, including the percentage of Certificateholders under any Trust which are permitted to (i) grant waivers of defaults under any Related Indenture, (ii) consent to the amendment or modification of any Related Indenture or (iii) direct the exercise of remedial actions under any Related Indenture. Termination of the Trusts The obligations of Continental and the Trustee with respect to a Trust will terminate upon the distribution to Certificateholders of such Trust of all amounts required to be distributed to them pursuant to the Basic Agreement and the applicable Trust Supplement and the disposition of all property held in such Trust. In no event shall any Trust continue beyond 110 years following the date of the execution of the applicable Trust Supplement (or such other final expiration date as may be specified in such Trust Supplement). The Trustee will send to each Certificateholder of record of such Trust notice of the termination of such Trust, the amount of the proposed final payment and the proposed date for the distribution of such final payment for such Trust. The final distribution to any Certificateholder of such Trust will be made only upon surrender of such Certificateholder's Certificates at the office or agency of the Trustee specified in such notice of termination. Delayed Purchase of Equipment Notes In the event that, on the issuance date of any Certificates, all of the proceeds from the sale of such Certificates are not used to purchase the Equipment Notes contemplated to be held in the related Trust, such Equipment Notes may be purchased by the Trustee at any time on or prior to the date specified in the applicable Prospectus Supplement. In such event, the proceeds from the sale of such Certificates not used to purchase Equipment Notes will be held under an arrangement described in the applicable Prospectus Supplement pending the purchase of the Equipment Notes not so purchased. The arrangements with respect to the payment of interest on funds so held will be described in the applicable Prospectus Supplement. If any such proceeds are not subsequently utilized to purchase Equipment Notes by the relevant date specified in the applicable Prospectus Supplement, such proceeds will be returned to the holders of such Certificates. Liquidity Facility The related Prospectus Supplement may provide that one or more payments of interest on the Certificates of one or more series will be supported by a Liquidity Facility issued by an institution identified in the related Prospectus Supplement. The provider of such Liquidity Facility may have a claim senior to the Certificateholders' as specified in the related Prospectus Supplement. The Trustee Unless otherwise provided in the Prospectus Supplement for any series of Certificates, the Trustee for each series of Certificates will be Wilmington Trust Company. With certain exceptions, the Trustee makes no representations as to the validity or sufficiency of the Basic Agreement, the Trust Supplements, the Certificates, the Equipment Notes, the Indentures, the Leases or other related documents. The Trustee shall not be liable with respect to any series of Certificates for any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders of a majority in principal amount of outstanding Certificates of such series issued under the Basic Agreement. Subject to such provisions, such Trustee shall be under no obligation to exercise any of its rights or powers under the Basic Agreement at the request of any holders of Certificates issued thereunder unless they shall have offered to the Trustee indemnity satisfactory to it. The Basic Agreement provides that the Trustee in its individual or any other capacity may acquire and hold Certificates issued thereunder and, subject to certain conditions, may otherwise deal with Continental and, with respect to the Leased Aircraft, with any Owner Trustee with the same rights it would have if it were not the Trustee. The Trustee may resign with respect to any or all of the Trusts at any time, in which event Continental will be obligated to appoint a successor trustee. If the Trustee ceases to be eligible to continue as Trustee with respect to a Trust or becomes incapable of acting as Trustee or becomes insolvent, Continental may remove such Trustee, or any Certificateholder of such Trust for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of such Trustee and the appointment of a successor trustee. Any resignation or removal of the Trustee with respect to a Trust and appointment of a successor trustee for such Trust does not become effective until acceptance of the appointment by the successor trustee. Pursuant to such resignation and successor trustee provisions, it is possible that a different trustee could be appointed to act as the successor trustee with respect to each Trust. All references in this Prospectus to the Trustee should be read to take into account the possibility that the Trusts could have different successor trustees in the event of such a resignation or removal. The Basic Agreement provides that Continental will pay the Trustee's fees and expenses and indemnify the Trustee against certain liabilities. DESCRIPTION OF THE EQUIPMENT NOTES The statements made under this caption are summaries and reference is made to the entire Prospectus and detailed information appearing in the applicable Prospectus Supplement. Where no distinction is made between the Leased Aircraft Notes and the Owned Aircraft Notes or between their respective Indentures, such statements refer to any Equipment Notes and any Indenture. To the extent that any provision in any Prospectus Supplement is inconsistent with any provision in this summary, the provision of such Prospectus Supplement will control. General Equipment Notes will be issued under Indentures either (a) between the related Owner Trustee of a trust for the benefit of the Owner Participant who is the beneficial owner of the related Aircraft, and the related Loan Trustee, or (b) between Continental and the related Loan Trustee. The Equipment Notes issued pursuant to clause (a) of the preceding sentence will be nonrecourse obligations of the applicable Owner Trust. Each Equipment Note will be authenticated under an Indenture by the Loan Trustee. All Equipment Notes issued under the same Indenture will relate to, and be secured by, one or more Aircraft identified and described in the related Prospectus Supplement and which, in the case of Equipment Notes issued as described in such clause (a), are leased to Continental pursuant to a Lease between the Owner Trustee under the applicable Owner Trust and Continental or, in the case of Equipment Notes issued as described in clause (b), owned by Continental. With respect to each Leased Aircraft, the related Owner Trustee has acquired or will acquire such Aircraft, will grant a security interest in such Aircraft to the related Loan Trustee as security for the payments of the related Leased Aircraft Notes, and has leased or will lease such Aircraft to Continental pursuant to the related Lease which has been or will be assigned to the related Loan Trustee. Pursuant to each such Lease, Continental will be obligated to make or cause to be made rental and other payments to the related Loan Trustee on behalf of the related Owner Trustee. Principal and Interest Payments Interest received by the Trustee on the Equipment Notes held in each Trust will be passed through to the Certificateholders of such Trust on the dates and at the rate per annum set forth in the applicable Prospectus Supplement until the final distribution for such Trust. Principal payments received by the Trustee on the Equipment Notes held in each Trust will be passed through to the Certificateholders of such Trust in scheduled amounts on the dates set forth in the applicable Prospectus Supplement until the final distribution date for such Trust. If any date scheduled for any payment of principal, premium, if any, or interest with respect to the Equipment Notes is not a Business Day, such payment will be made on the next succeeding Business Day without any additional interest. Redemption The applicable Prospectus Supplement will describe the circumstances, whether voluntary or involuntary, under which the Equipment Notes may be redeemed or purchased prior to the stated maturity date thereof, in whole or in part, the premium, if any, applicable upon certain redemptions or purchases and other terms applying to the redemptions or purchases of such Equipment Notes. Security The Leased Aircraft Notes will be secured by (i) an assignment by the related Owner Trustee to the related Loan Trustee of such Owner Trustee's rights (except for certain rights, including those described below) under the Lease or Leases with respect to the related Aircraft, including the right to receive payments of rent thereunder, and (ii) a mortgage granted to such Loan Trustee in such Aircraft, subject to the rights of Continental under such Lease or Leases. Under the terms of each Lease, Continental's obligations in respect of each Leased Aircraft will be those of a lessee under a "net lease". Accordingly, Continental will be obligated, among other things and at its expense, to cause each Leased Aircraft to be duly registered, to pay all costs of operating such Aircraft and to maintain, service, repair and overhaul (or cause to be maintained, serviced, repaired and overhauled) such Aircraft. With respect to the Leased Aircraft, the assignment by the related Owner Trustee to the related Loan Trustee of its rights under the related Lease will exclude, among other things, rights of such Owner Trustee and the related Owner Participant relating to indemnification by Continental for certain matters, insurance proceeds payable to such Owner Trustee in its individual capacity and to such Owner Participant under liability insurance maintained by Continental pursuant to such Lease or by such Owner Trustee or such Owner Participant, insurance proceeds payable to such Owner Trustee in its individual capacity or to such Owner Participant under certain casualty insurance maintained by such Owner Trustee or such Owner Participant pursuant to such Lease and any rights of such Owner Participant or such Owner Trustee to enforce payment of the foregoing amounts and their respective rights to the proceeds of the foregoing. The Owned Aircraft Notes will be secured by a mortgage granted to the related Loan Trustee of all of Continental's right, title and interest in and to such Owned Aircraft. Under the terms of each Owned Aircraft Indenture, Continental will be obligated, among other things and at its expense, to cause each Owned Aircraft to be duly registered, to pay all costs of operating such Aircraft and to maintain, service, repair and overhaul (or cause to be maintained, serviced, repaired and overhauled) such Aircraft. The Prospectus Supplement will describe the required insurance coverage with respect to the Aircraft. Continental will be required, except under certain circumstances, to keep each Aircraft registered under the Transportation Code, and to record the Indenture and the Lease, if applicable, among other documents, with respect to each Aircraft under the Transportation Code. Such recordation of the Indenture, the Lease, if applicable, and other documents with respect to each Aircraft will give the related Loan Trustee a perfected security interest in the related Aircraft whenever it is located in the United States or any of its territories and possessions; the Convention on the International Recognition of Rights in Aircraft (the "Convention") provides that such security will also be recognized, with certain limited exceptions, in those jurisdictions that have ratified or adhere to the Convention. Continental will have the right, subject to certain conditions, at its own expense to register each Aircraft in countries other than the United States. Each Aircraft may also be operated by Continental or under lease, sublease or interchange arrangements in countries that are not parties to the Convention. The extent to which the related Loan Trustee's security interest would be recognized in an Aircraft located in a country that is not a party to the Convention, and the extent to which such security interest would be recognized in a jurisdiction adhering to the Convention if the Aircraft is registered in a jurisdiction not a party to the Convention, is uncertain. Moreover, in the case of an Indenture Default, the ability of the related Loan Trustee to realize upon its security interest in an Aircraft could be adversely affected as a legal or practical matter if such Aircraft were registered or located outside the United States. Unless otherwise specified in the applicable Prospectus Supplement, the Equipment Notes will not be cross-collateralized and consequently the Equipment Notes issued in respect of any one Aircraft will not be secured by any other Aircraft or, in the case of Leased Aircraft Notes, the Lease related thereto. Unless and until an Indenture Default with respect to a Leased Aircraft has occurred and is continuing, the related Loan Trustee may exercise only limited rights of the related Owner Trustee under the related Lease. Funds, if any, held from time to time by the Loan Trustee with respect to any Aircraft, prior to the distribution thereof, will be invested and reinvested by such Loan Trustee. Such investment and reinvestment will be at the direction of Continental (except, with respect to a Leased Aircraft, in the case of a Lease Event of Default under the applicable Lease or, with respect to an Owned Aircraft, in the case of an Indenture Default under the applicable Indenture), in certain investments described in the applicable Indenture. The net amount of any loss resulting from any such investments will be paid by Continental. Section 1110 of the U.S. Bankruptcy Code provides in relevant part that the right of lessors, conditional vendors and holders of security interests with respect to "equipment" (as defined in Section 1110 of the U.S. Bankruptcy Code) to take possession of such equipment in compliance with the provisions of a lease, conditional sale contract or security agreement, as the case may be, is not affected by (a) the automatic stay provision of the U.S. Bankruptcy Code, which provision enjoins repossessions by creditors for the duration of the reorganization period, (b) the provision of the U.S. Bankruptcy Code allowing the trustee in reorganization to use property of the debtor during the reorganization period, (c) Section 1129 of the U.S. Bankruptcy Code (which governs the confirmation of plans of reorganization in Chapter 11 cases) and (d) any power of the bankruptcy court to enjoin a repossession. Section 1110 provides, however, in relevant part that the right of a lessor, conditional vendor or holder of a security interest to take possession of an aircraft in the event of an event of default may not be exercised for 60 days following the date of commencement of the reorganization proceedings (unless specifically permitted by the bankruptcy court) and may not be exercised at all if, within such 60-day period (or such longer period consented to by the lessor, conditional vendor or holder of a security interest), the trustee in reorganization agrees to perform the debtor's obligations that become due on or after such date and cures all existing defaults (other than defaults resulting solely from the financial condition, bankruptcy, insolvency or reorganization of the debtor). "Equipment" is defined in Section 1110 of the U.S. Bankruptcy Code, in part, as an aircraft, aircraft engine, propeller, appliance, or spare part (as defined in Section 40102 of Title 49 of the U.S. Code) that is subject to a security interest granted by, leased to, or conditionally sold to a debtor that is a citizen of the United States (as defined in Section 40102 of Title 49 of the U.S. Code) holding an air carrier operating certificate issued by the Secretary of Transportation pursuant to chapter 447 of Title 49 of the U.S. Code for aircraft capable of carrying 10 or more individuals or 6,000 pounds of more of cargo (subject to certain limitations in the case of equipment first placed in service on or prior to October 22, 1994). In connection with any issuance of Certificates under this Prospectus and the applicable Prospectus Supplement, it is a condition to the Trustee's obligation to purchase Equipment Notes with respect to each Aircraft that outside counsel to Continental provide its opinion to such Trustee that (i) if such Aircraft is a Leased Aircraft, the Owner Trustee, as lessor under the Lease for such Aircraft, and the Loan Trustee, as assignee of such Owner Trustee's rights under such Lease pursuant to the applicable Indenture, will be entitled to the benefits of Section 1110 of the U.S. Bankruptcy Code with respect to the airframe and engines comprising such Aircraft or (ii) if such Aircraft is an Owned Aircraft, the Loan Trustee will be entitled to the benefits of Section 1110 with respect to the airframe and engines comprising such Owned Aircraft, in each case so long as Continental continues to be a "citizen of the United States" as defined in Section 40102 of Title 49 of the U.S. Code holding an air carrier operating certificate issued by the Secretary of Transportation pursuant to Chapter 447 of Title 49 of the U.S. Code for aircraft capable of carrying 10 or more individuals or 6,000 pounds or more of cargo. Such opinion will not address the possible replacement of an Aircraft after an Event of Loss (as defined in the Indenture) in the future. Ranking of Equipment Notes Some of the Equipment Notes related to one or more Aircraft, as described in the related Prospectus Supplement, may be subordinated and junior in right of payment to other Equipment Notes related to the same Aircraft. The terms of such subordination, if any, will be described in the related Prospectus Supplement. Payments and Limitation of Liability Each Leased Aircraft will be leased by the related Owner Trustee to Continental for a term commencing on the delivery date thereof to such Owner Trustee and expiring on a date not earlier than the latest maturity date of the related Leased Aircraft Notes, unless previously terminated as permitted by the terms of the related Lease. The basic rent and certain other payments under each such Lease will be payable by Continental and will be assigned by the related Owner Trustee under the applicable Indenture to the related Loan Trustee to provide the funds necessary to pay principal of, premium, if any, and interest due from such Owner Trustee on the Leased Aircraft Notes issued under such Indenture. In certain cases, the basic rent payments under a Lease may be adjusted, but each Lease will provide that under no circumstances will rent payments by Continental be less than the scheduled payments on the related Leased Aircraft Notes. The balance of any basic rent payment under each Lease, after payment of amounts due on the Leased Aircraft Notes issued under the Indenture corresponding to such Lease, will be paid over to the applicable Owner Trustee. Continental's obligation to pay rent and to cause other payments to be made under each Lease will be general obligations of Continental. With respect to the Leased Aircraft Notes, except in certain circumstances involving Continental's purchase of a Leased Aircraft and the assumption of the Leased Aircraft Notes related thereto, the Leased Aircraft Notes will not be obligations of, or guaranteed by, Continental. With respect to the Leased Aircraft Notes, none of the Owner Trustees, the Owner Participants or the Loan Trustees shall be personally liable to any holder of such Leased Aircraft Notes for amounts payable under such Leased Aircraft Notes, or, except as provided in the Indentures relating thereto in the case of the Owner Trustees and the Loan Trustees, for any liability under such Indentures. Except in the circumstances referred to above, all amounts payable under any Leased Aircraft Notes (other than payments made in connection with an optional redemption or purchase by the related Owner Trustee or the related Owner Participant) will be made only from (i) the assets subject to the lien of the applicable Indenture with respect to such Aircraft or the income and proceeds received by the related Loan Trustee therefrom (including rent payable by Continental under the related Lease) or (ii) if so provided in the related Prospectus Supplement, the applicable Liquidity Facility. With respect to the Leased Aircraft Notes, except as otherwise provided in the applicable Indenture, no Owner Trustee shall be personally liable for any amount payable or for any statements, representations, warranties, agreements or obligations under any such Indenture or under such Leased Aircraft Notes except for its own willful misconduct or gross negligence. None of the Owner Participants shall have any duty or responsibility under the Leased Aircraft Indentures or under such Leased Aircraft Notes to the related Loan Trustee or to any holder of any such Leased Aircraft Note. Continental's obligations under each Owned Aircraft Indenture and under the Owned Aircraft Notes will be general obligations of Continental. Defeasance of the Indentures and the Equipment Notes in Certain Circumstances Unless otherwise specified in the applicable Prospectus Supplement, the applicable Indenture provides that the obligations of the related Loan Trustee and, with respect to any Leased Aircraft Notes, the related Owner Trustee or, with respect to any Owned Aircraft Notes, Continental under the applicable Indenture shall be deemed to have been discharged and paid in full (except for certain obligations, including the obligations to register the transfer or exchange of Equipment Notes, to replace stolen, lost, destroyed or mutilated Equipment Notes and to maintain paying agencies and hold money for payment in trust) on the 91st day after the date of irrevocable deposit with the related Loan Trustee of money or certain obligations of the United States or any agency or instrumentality thereof the payment of which is backed by the full faith and credit of the United States which, through the payment of principal and interest in respect thereof in accordance with their terms, will provide money in an aggregate amount sufficient to pay when due (including as a consequence of redemption in respect of which notice is given on or prior to the date of such deposit) principal of, premium, if any, and interest on all Equipment Notes issued thereunder in accordance with the terms of such Indenture. Such discharge may occur only if, among other things, there has been published by the Internal Revenue Service a ruling to the effect that holders of such Equipment Notes will not recognize income, gain or loss for federal income tax purposes as a result of such deposit, defeasance and discharge and will be subject to federal income tax on the same amount and in the same manner and at the same time as would have been the case if such deposit, defeasance and discharge had not occurred. Upon such defeasance, or upon payment in full of the principal of, premium, if any, and interest on all Equipment Notes issued under any Indenture on the maturity date therefor or deposit with the applicable Loan Trustee of money sufficient therefor no earlier than one year prior to the date of such maturity, the holders of such Equipment Notes will have no beneficial interest in or other rights with respect to the related Aircraft or other assets subject to the lien of such Indenture and such lien shall terminate. Assumption of Obligations by Continental Unless otherwise specified in the applicable Prospectus Supplement with respect to Leased Aircraft, upon the exercise by Continental of any purchase options it may have under the related Lease prior to the end of the term of such Lease, Continental may assume on a full recourse basis all of the obligations of the Owner Trustee (other than its obligations in its individual capacity) under the Indenture with respect to such Aircraft, including the obligations to make payments in respect of the related Leased Aircraft Notes. In such event, certain relevant provisions of the related Lease, including (among others) provisions relating to maintenance, possession and use of the related Aircraft, liens, insurance and events of default will be incorporated into such Indenture, and the Leased Aircraft Notes issued under such Indenture will not be redeemed and will continue to be secured by such Aircraft. Liquidity Facility The related Prospectus Supplement may provide that one or more payments of interest on the related Equipment Notes of one or more series or distributions made by the Trustee of the related Trust will be supported by a Liquidity Facility issued by an institution identified in the related Prospectus Supplement. Unless otherwise provided in the related Prospectus Supplement, the provider of the Liquidity Facility will have a senior claim upon the assets securing the Equipment Notes. Intercreditor Issues Equipment Notes may be issued in different Classes, which means that the Equipment Notes may have different payment priorities even though they are issued by the same borrower and relate to the same Aircraft. In such event, the related Prospectus Supplement will describe the priority of distributions among such Equipment Notes (and any Liquidity Facilities therefor), the ability of any Class to exercise and/or enforce any or all remedies with respect to the related Aircraft (and, if the Equipment Notes are Leased Aircraft Notes, the Lease related thereto) and certain other intercreditor terms and provisions. CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES General Unless otherwise indicated in the applicable Prospectus Supplement, the following summary describes the principal U.S. federal income tax consequences to Certificateholders of the purchase, ownership and disposition of the Certificates offered hereby and in the opinion of Hughes Hubbard & Reed LLP, special tax counsel to Continental ("Tax Counsel"), is accurate in all material respects with respect to the matters discussed therein. Except as otherwise specified, the summary is addressed to beneficial owners of Certificates ("U.S. Certificateholders") that are citizens or residents of the United States, corporations, partnerships or other entities created or organized in or under the laws of the United States or any state therein, or estates or trusts the income of which is subject to U.S. federal income taxation regardless of its source ("U.S. Persons") that will hold the Certificates as capital assets. This summary does not address the tax treatment of U.S. Certificateholders that may be subject to special tax rules, such as banks, insurance companies, dealers in securities or commodities, tax-exempt entities, holders that will hold Certificates as part of a straddle or holders that have a "functional currency" other than the U.S. Dollar, nor does it address the tax treatment of U.S. Certificateholders that do not acquire Certificates at the initial offering price as part of the initial offering thereof. The summary does not purport to be a comprehensive description of all of the tax considerations that may be relevant to a decision to purchase Certificates. This summary does not describe any tax consequences arising under the laws of any state, locality or taxing jurisdiction other than the United States. The summary is based upon the tax laws and practice of the United States as in effect on the date of this Prospectus, as well as judicial and administrative interpretations thereof (in final or proposed form) available on or before such date. All of the foregoing are subject to change, which change could apply retroactively. Prospective investors should note that no rulings have been sought from the Internal Revenue Service (the "IRS") with respect to the federal income tax consequences, discussed below, and no assurances can be given that the IRS will not take contrary positions. The Trusts are not indemnified for any federal income taxes that may be imposed upon them, and the imposition of any such taxes on a Trust could result in a reduction in the amounts available for distribution to the Certificateholders of such Trust. PROSPECTIVE INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE CERTIFICATES. Tax Status of the Trusts In the opinion of Tax Counsel, each Trust will be classified as a grantor trust for U.S. federal income tax purposes. Taxation of Certificateholders Generally A U.S. Certificateholder will be treated as owning its pro rata undivided interest in each of the Equipment Notes and any other property held by the related Trust. Accordingly, each U.S. Certificateholder's share of interest paid on the Equipment Notes will be taxable as ordinary income, as it is paid or accrued, in accordance with such U.S. Certificateholder's method of accounting for U.S. federal income tax purposes, and a U.S. Certificateholder's share of premium, if any, paid on redemption of an Equipment Note will be treated as capital gain. In the event that a Trust is supported by a Liquidity Facility, any amounts received by the Trust under the Liquidity Facility with respect to unpaid interest will be treated for U.S. federal income tax purposes as having the same characteristics as the payments they replace. If Continental were to assume an Owner Trust's obligations under Leased Aircraft Notes, such assumption would be treated for federal income tax purposes as a taxable exchange of such Leased Aircraft Notes, resulting in recognition of gain or loss by the U.S. Certificateholder. Each U.S. Certificateholder will be entitled to deduct, consistent with its method of accounting, its pro rata share of fees and expenses paid or incurred by the corresponding Trust as provided in Section 162 or 212 of the Internal Revenue Code of 1986, as amended (the "Code"). Certain fees and expenses, including fees paid to the Trustee and the provider of the Liquidity Facility (if applicable), will be borne by parties other than the Certificateholders. It is possible that such fees and expenses will be treated as constructively received by the Trust, in which event a U.S. Certificateholder will be required to include in income and will be entitled to deduct its pro rata share of such fees and expenses. If a U.S. Certificateholder is an individual, estate or trust, the deduction for such holder's share of such fees or expenses will be allowed only to the extent that all of such holder's miscellaneous itemized deductions, including such holder's share of such fees and expenses, exceed 2% of such holder's adjusted gross income. In addition, in the case of U.S. Certificateholders who are individuals, certain otherwise allowable itemized deductions will be subject generally to additional limitations on itemized deductions under applicable provisions of the Code. Effect of Subordination of Subordinated Certificateholders In the event that any Trust (such Trust being a "Subordinated Trust" and the related Certificates being "Subordinated Certificates") is subordinated in right of payment to any other Trust and the Subordinated Trust receives less than the full amount of the receipts of interest, principal or premium paid with respect to the Equipment Notes held by it (any shortfall in such receipts being the "Shortfall Amounts") because of the subordination of such Trust, the corresponding owners of beneficial interests in the Subordinated Certificates (the "Subordinated Certificateholders") would probably be treated for federal income tax purposes as if they had (1) received as distributions their full share of such receipts, (2) paid over to the relevant preferred class of Certificateholders an amount equal to their share of such Shortfall Amount, and (3) retained the right to reimbursement of such amounts to the extent of future amounts payable to such Subordinated Certificateholders with respect to such Shortfall Amount. Under this analysis, (1) Subordinated Certificateholders incurring a Shortfall Amount would be required to include as current income any interest or other income of the corresponding Subordinated Trust that was a component of the Shortfall Amount, even though such amount was in fact paid to the relevant preferred class of Certificateholders, (2) a loss would only be allowed to such Subordinated Certificateholders when their right to receive reimbursement of such Shortfall Amount becomes worthless (i.e., when it becomes clear that funds will not be available from any source to reimburse such loss), and (3) reimbursement of such Shortfall Amount prior to such a claim of worthlessness would not be taxable income to Subordinated Certificateholders because such amount was previously included in income. These results should not significantly affect the inclusion of income for Subordinated Certificateholders on the accrual method of accounting, but could accelerate inclusion of income to Subordinated Certificateholders on the cash method of accounting by, in effect, placing them on the accrual method. Original Issue Discount The Equipment Notes may be issued with original issue discount ("OID"). The Prospectus Supplement will state whether any Equipment Notes to be held by the related Trust will be issued with OID. Generally, a holder of a debt instrument issued with OID that is not de minimis must include such OID in income for federal income tax purposes as it accrues, in advance of the receipt of the cash attributable to such income, under a method that takes into account the compounding of interest. Sale or Other Disposition of the Certificates Upon the sale, exchange or other disposition of a Certificate, a U.S. Certificateholder generally will recognize capital gain or loss equal to the difference between the amount realized on the disposition (other than any amount attributable to accrued interest which will be taxable as ordinary income) and the U.S. Certificateholder's adjusted tax basis in the related Equipment Notes and any other property held by the corresponding Trust. Any gain or loss will be long-term capital gain or loss to the extent attributable to property held by the Trust for more than one year. In the case of individuals, estates, and trusts, the maximum rate of tax on long-term capital gains generally is 20%, except that a maximum rate of 28% applies to property held for more than one year but not more than 18 months. Foreign Certificateholders Subject to the discussion of backup withholding below, payments of principal and interest on the Equipment Notes to, or on behalf of, any beneficial owner of a Certificate that is not a U.S. Person (a "Non-U.S. Certificateholder") will not be subject to U.S. federal withholding tax; provided, in the case of interest, that (i) such Non-U.S. Certificateholder does not actually or constructively own 10% or more of the total combined voting power of all classes of the stock of an Owner Participant or Continental, (ii) such Non-U.S. Certificateholder is not a controlled foreign corporation for U.S. tax purposes that is related to an Owner Participant or Continental and (iii) either (A) the Non-U.S. Certificateholder certifies, under penalties of perjury, that it is not a U.S. Person and provides its name and address or (B) a securities clearing organization, bank or other financial institution that holds customers' securities in the ordinary course of its trade or business (a "financial institution") and holds the Certificate certifies, under penalties of perjury, that such statement has been received from the Non-U.S. Certificateholder by it or by another financial institution and furnishes the payor with a copy thereof. The IRS issued final regulations on October 6, 1997, which modify the certification requirements described in clause (iii) with respect to certain payments after December 31, 1998. Any capital gain realized upon the sale, exchange, retirement or other disposition of a Certificate or upon receipt of premium paid on an Equipment Note by a Non-U.S. Certificateholder will not be subject to U.S. federal income or withholding taxes if (i) such gain is not effectively connected with a U.S. trade or business of the Non-U.S. Certificateholder and (ii) in the case of an individual, such Non-U.S. Certificateholder is not present in the United States for 183 days or more in the taxable year of the sale, exchange, retirement or other disposition or receipt. Backup Withholding Payments made on the Certificates and proceeds from the sale of Certificates will not be subject to a backup withholding tax of 31% unless, in general, the Certificateholder fails to comply with certain reporting procedures or otherwise fails to establish an exemption from such tax under applicable provisions of the Code. ERISA CONSIDERATIONS Unless otherwise indicated in the applicable Prospectus Supplement, the Certificates may, subject to certain legal restrictions, be purchased and held by an employee benefit plan (a "Plan") subject to Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or an individual retirement account or an employee benefit plan subject to section 4975 of the Code. A fiduciary of a Plan must determine that the purchase and holding of a Certificate is consistent with its fiduciary duties under ERISA and does not result in a non-exempt prohibited transaction as defined in section 406 of ERISA or section 4975 of the Code. Employee benefit plans which are governmental plans (as defined in section 3(32) of ERISA) and certain church plans (as defined in section 3(33) of ERISA) are not subject to Title I of ERISA or section 4975 of the Code. The Certificates may, subject to certain legal restrictions, be purchased and held by such plans. PLAN OF DISTRIBUTION Certificates may be sold to one or more underwriters for public offering and sale by them or to investors or other persons directly or through one or more dealers or agents. Any such underwriter, dealer or agent involved in the offer and sale of the Certificates will be named in an applicable Prospectus Supplement. The Certificates may be sold at a fixed price or prices, which may be changed, or from time to time at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. Dealer trading may take place in certain of the Certificates, including Certificates not listed on any securities exchange. Continental does not intend to apply for listing of the Certificates on a national securities exchange. Continental also may, from time to time, authorize underwriters acting as Continental's agents to offer and sell the Certificates upon the terms and conditions as shall be set forth in any Prospectus Supplement. In connection with the sale of Certificates, underwriters may be deemed to have received compensation from Continental in the form of underwriting discounts or commissions and may also receive commissions from purchasers of Certificates for whom they may act as agent. Underwriters may sell Certificates to or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions (which may be changed from time to time) from the purchasers for whom they may act as agent. If a dealer is used directly by Continental in the sale of Certificates in respect of which this Prospectus is delivered, such Certificates will be sold to the dealer, as principal. The dealer may then resell such Certificates to the public at varying prices to be determined by such dealer at the time of resale. Any such dealer and the terms of any such sale will be set forth in the Prospectus Supplement relating thereto. Certificates may be offered and sold through agents designated by Continental from time to time. Any such agent involved in the offer or sale of the Certificates in respect of which this Prospectus is delivered will be named in, and any commissions payable by Continental to such agent will be set forth in, the applicable Prospectus Supplement. Unless otherwise indicated in the applicable Prospectus Supplement, any such agent will be acting on a best efforts basis for the period of its appointment. Offers to purchase Certificates may be solicited directly by Continental and sales thereof may be made by Continental directly to institutional investors or others who may be deemed to be underwriters within the meaning of the Securities Act with respect to any resale thereof. The terms of any such sales will be described in the Prospectus Supplement relating thereto. Except as set forth in the applicable Prospectus Supplement, no director, officer or employee of Continental will solicit or receive a commission in connection with direct sales by Continental of the Certificates, although such persons may respond to inquiries by potential purchasers and perform ministerial and clerical work in connection with any such direct sales. Any underwriting compensation paid by Continental to underwriters, dealers or agents in connection with the offering of Certificates, and any discounts, concessions or commissions allowed by underwriters to participating dealers, will be set forth in an applicable Prospectus Supplement. Underwriters, dealers and agents participating in the distribution of the Certificates may be deemed to be underwriters, and any discounts and commissions received by them and any profit realized by them on resale of the Certificates may be deemed to be underwriting discounts and commissions under the Securities Act. Underwriters, dealers and agents may be entitled, under agreements with Continental, to indemnification against and contribution toward certain civil liabilities, including liabilities under the Securities Act, and to reimbursement by Continental for certain expenses. Underwriters, dealers and agents may engage in transactions with, or perform services for, Continental and its subsidiaries in the ordinary course of business. If so indicated in an applicable Prospectus Supplement and subject to existing market conditions, Continental will authorize dealers acting as Continental's agents to solicit offers by certain institutions to purchase Certificates at the public offering price set forth in such Prospectus Supplement pursuant to Delayed Delivery Contracts ("Contracts") providing for payment and delivery on the date or dates stated in such Prospectus Supplement. Each Contract will be for an amount not less than, and the aggregate principal amount of Certificates sold pursuant to Contracts shall not be less nor more than, the respective amounts stated in such Prospectus Supplement. Institutions with whom Contracts, when authorized, may be made include commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions and other institutions, but will in all cases be subject to the approval of Continental. Contracts will not be subject to any conditions except the purchase by an institution of the Certificates covered by its Contracts shall not at the time of delivery be prohibited under the laws of any jurisdiction in the United States to which such institution is subject. A commission indicated in the applicable Prospectus Supplement will be granted to underwriters and agents soliciting purchases of Certificates pursuant to Contracts accepted by Continental. Agents and underwriters will have no responsibility in respect of the delivery or performance of Contracts. If an underwriter or underwriters are utilized in the sale of any Certificates, the applicable Prospectus Supplement will contain a statement as to the intention, if any, of such underwriters at the date of such Prospectus Supplement to make a market in the Certificates. No assurances can be given that there will be a market for the Certificates. The place and time of delivery for the Certificates in respect of which this Prospectus is delivered will be set forth in the applicable Prospectus Supplement. LEGAL OPINIONS Unless otherwise indicated in the applicable Prospectus Supplement, the validity of the Certificates will be passed upon for Continental by Hughes Hubbard & Reed LLP, New York, New York. Unless otherwise indicated in the applicable Prospectus Supplement, Hughes Hubbard & Reed LLP will rely on the opinion of counsel for the Trustee as to certain matters relating to the authorization, execution and delivery of such Certificates by, and the valid and binding effect thereof on, such Trustee. EXPERTS The consolidated financial statements (including financial statement schedule) of Continental Airlines, Inc. appearing in Continental Airlines, Inc.'s Annual Report (Form 10-K) for the year ended December 31, 1997, have been audited by Ernst & Young LLP, independent auditors, as set forth in their reports thereon included therein and incorporated herein by reference. Such consolidated financial statements are, and audited consolidated financial statements to be included in subsequently filed documents will be, incorporated herein by reference in reliance upon the reports of Ernst & Young LLP pertaining to such consolidated financial statements (to the extent covered by consents filed with the Commission) given upon the authority of such firm as experts in accounting and auditing. PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 14. Other Expenses of Issuance and Distribution. The estimated expenses in connection with this offering, other than underwriting discounts and commissions, are: Securities and Exchange Commission registration filing fee........ $737,500 Printing and engraving expenses................................... 400,000* Trustee fees and expenses......................................... 25,000* Accounting fees and expenses...................................... 100,000* Rating Agency fees................................................ 85,000* Legal fees and expenses........................................... 500,000* Miscellaneous..................................................... 152,500* ----------- Total..................................................... $2,000,000* =========== ----------------- * Estimates. Item 15. Indemnification of Directors and Officers. The Company's Certificate of Incorporation and Bylaws provide that the Company will indemnify each of its directors and officers to the full extent permitted by the laws of the State of Delaware and may indemnify certain other persons as authorized by the Delaware General Corporation Law (the "GCL"). Section 145 of the GCL provides as follows: "(a) A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. (b) A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. (c) To the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of this section, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him in connection therewith. (d) Any indemnification under subsections (a) and (b) of this section (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because he has met the applicable standard of conduct set forth in subsections (a) and (b). Such determination shall be made (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (2) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (3) by the stockholders. (e) Expenses (including attorneys' fees) incurred by an officer or director in defending any civil, criminal, administrative, or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the corporation as authorized in this section. Such expenses (including attorneys' fees) incurred by other employees and agents may be so paid upon such terms and conditions, if any, as the board of directors deems appropriate. (f) The indemnification and advancement of expenses provided by, or granted pursuant to, the other subsections of this section shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office. (g) A corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the corporation would have the power to indemnify him against such liability under this section. (h) For purposes of this section, references to "the corporation" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under this section with respect to the resulting or surviving corporation as he would have with respect to such constituent corporation if its separate existence had continued. (i) For purposes of this section, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to "serving at the request of the corporation" shall include any service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the corporation" as referred to in this section. (j) The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. (k) The Court of Chancery is hereby vested with exclusive jurisdiction to hear and determine all actions for advancement of expenses or indemnification brought under this section or under any bylaw, agreement, vote of stockholders or disinterested directors, or otherwise. The Court of Chancery may summarily determine a corporation's obligation to advance expenses (including attorneys' fees)". The Certificate of Incorporation and Bylaws of the Company also limit the personal liability of directors to the Company and its stockholders for monetary damages resulting from certain breaches of the directors' fiduciary duties. The Certificate of Incorporation of the Company provides as follows: "No Director of the Corporation shall be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a Director, except for liability (i) for any breach of the Director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the GCL, or (iv) for any transaction from which the Director derived any improper personal benefit. If the GCL is amended . . . to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the GCL, as so amended". The Company maintains directors' and officers' liability insurance. ITEM 16. EXHIBITS Reference is made to the Exhibit Index which immediately precedes the exhibits filed with this Registration Statement, which is incorporated herein by reference. ITEM 17. UNDERTAKINGS The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant have been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of such registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Houston, State of Texas, on August 14, 1998. CONTINENTAL AIRLINES, INC. By: /s/ Jeffery A. Smisek ------------------------------- Jeffery A. Smisek Executive Vice President, General Counsel and Secretary Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated, on August 14, 1998. Signature Title --------- ----- * Chairman of the Board, Chief Executive ----------------------------------- Officer (Principal Executive Officer) Gordon M. Bethune and Director * Executive Vice President and Chief - ----------------------------------- Financial Officer Lawrence W. Kellner (Principal Financial Officer) * Vice President and Controller - ----------------------------------- (Principal Accounting Officer) Michael P. Bonds * Director - ----------------------------------- Thomas J. Barrack, Jr. - ----------------------------------- Director Lloyd M. Bentsen, Jr. * Director - ----------------------------------- David Bonderman * Director - ----------------------------------- Gregory D. Brenneman * Director - ----------------------------------- Patrick Foley * Director - ----------------------------------- Douglas H. McCorkindale Director - ----------------------------------- George G. C. Parker * Director - ----------------------------------- Richard W. Pogue * Director - ----------------------------------- William S. Price III * Director - ----------------------------------- Donald L. Sturm * Director - ----------------------------------- Karen Hastie Williams * Director - ----------------------------------- Charles A. Yamarone *By: /s/ Scott R. Peterson ------------------------------- Scott R. Peterson Attorney-in-fact EXHIBIT INDEX Exhibit No. Exhibit - ----------- ------- 4.1 Form of Pass Through Trust Agreement -- filed as Exhibit 4.1 to the Company's Registration Statement on Form S-3 (No. 333-31285) (the "July 1997 S-3") and incorporated herein by reference* 5.1 Opinion of Hughes Hubbard & Reed LLP 12.1 Computation of Ratio of Earnings to Fixed Charges 23.1 Consent of Ernst & Young LLP 23.1 Consent of Hughes Hubbard & Reed LLP (included in its opinion filed as exhibit 5.1) 24.1 Powers of Attorney 25.1 Statement of Eligibility of Wilmington Trust Company on Form T-1 with respect to the Pass Through Trust Agreement - -------- * The Pass Through Trust Agreement was previously qualified under the Trust Indenture Act of 1939 in connection with the July 1997 S-3.
                                                                     EXHIBIT 5.1



                      OPINION OF HUGHES HUBBARD & REED LLP




Hughes Hubbard & Reed LLP                          One Battery Park Plaza
                                                   New York, New York 10004-1482
                                                   Telephone: 212-837-6000
                                                   Facsimile: 212-422-4726








                                         August 14, 1998



Continental Airlines, Inc.
2929 Allen Parkway
Houston, Texas  77019

          Re:  Continental Airlines, Inc.
               Registration Statement on Form S-3
               ----------------------------------

Ladies and Gentlemen:

          We have acted as your  counsel  in  connection  with the  Registration
Statement  on Form  S-3 (the  "Registration  Statement")  to be  filed  with the
Securities  and Exchange  Commission  pursuant to the Securities Act of 1933, as
amended  (the  "Act"),  with  respect to pass  through  certificates  (the "Pass
Through  Certificates")  expected  to be issued by one or more trusts  (each,  a
"Trust) to be formed by Continental Airlines, Inc. (the "Company").  Such Trusts
are  expected  to acquire  certain  equipment  notes  relating to aircraft to be
leased or owned by the Company. The Pass Through Certificates are expected to be
issued  and sold  from  time to time  pursuant  to Rule 415 under the Act for an
aggregate initial offering price not to exceed  $2,500,000,000 or the equivalent
thereof in one or more foreign currencies or composite currencies.

          The Pass  Through  Certificates  will be issued in one or more  series
under the Pass Through Trust Agreement  dated as of September 25, 1997,  between
the Company and Wilmington  Trust Company,  the trustee  thereunder  (the "Basic
Pass Through Trust  Agreement"),  the form of which has been filed as an exhibit
to the  Registration  Statement,  as supplemented by a separate trust supplement
(each, a "Trust Supplement") relating to each such series.

          We have examined the Certificate of  Incorporation  and By Laws of the
Company and the Basic Pass Through Trust Agreement, and we have assumed that the
Basic Pass Through Trust Agreement was duly  authorized,  executed and delivered
by,  and is the  valid and  binding  obligation  of,  Wilmington  Trust  Company
("WTC"),  as  trustee.  In  addition,  we have  examined,  and have relied as to



matters of fact upon, originals or copies,  certified or otherwise identified to
our satisfaction,  of such corporate  records,  agreements,  documents and other
instruments and such  certificates or comparable  documents of public  officials
and of officers and representatives of the Company, and have made such other and
further  investigations  as we have deemed relevant and necessary as a basis for
the opinion hereinafter set forth.

          Based upon and subject to the  foregoing,  we are of the opinion that,
with  respect  to  each  series  of  Pass  Through  Certificates,  when  (i) the
applicable provisions of the Act and such "Blue Sky" or state securities laws as
may be  applicable  shall have been  complied  with,  (ii) the Trust  Supplement
relating  to such  series has been duly  authorized  and  validly  executed  and
delivered by the Company and WTC, as trustee  under the Basic Pass Through Trust
Agreement,  (iii) the Board of Directors of the Company has taken all  necessary
corporate  action to approve  the terms of the  offering  of such series of Pass
Through  Certificates and related matters and (iv) the Pass Through Certificates
of such series have been duly executed,  authenticated,  issued and delivered in
accordance  with the  provisions of the Basic Pass Through Trust  Agreement,  as
supplemented  by the related Trust  Supplement,  and the  applicable  definitive
purchase,  underwriting or similar agreement  approved by the Board of Directors
of the Company  and upon  payment of the  consideration  therefor  provided  for
therein,  such series of Pass Through  Certificates  will be legally  issued and
binding obligations of WTC, as trustee of the applicable Trust.

          We are  members  of the Bar of the  State of New  York,  and we do not
express any opinion herein concerning any law other than the law of the State of
New  York,  the  federal  law of the  United  States  and the  Delaware  General
Corporation  Law. We have assumed that each Trust Supplement will be governed by
the laws of the State of New York.

          We hereby  consent to the filing of this opinion as an exhibit to said
Registration  Statement  and we  further  consent  to the use of our name in the
Registration  Statement  under the  caption  "Legal  Opinions".  In giving  this
consent,  we do not thereby  admit that we are in the category of persons  whose
consent is required  under Section 7 of the  Securities Act of 1933, as amended,
or  the  rules  and  regulations  of  the  Securities  and  Exchange  Commission
thereunder.

                                             Very truly yours,


                                             /s/  HUGHES HUBBARD & REED LLP
            
                                                                    EXHIBIT 12.1

               COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES



CONTINENTAL AIRLINES, INC.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(IN MILLIONS)

Six Months Three Months Six Months Three Months 4/28/93 | 1/1/93 Ended Ended Ended Ended through | through 6/30/98 6/30/98 6/30/97 6/30/97 1997 1996 1995 1994 12/31/93 | 4/27/93 ------------ ------------ ---------- ------------ ------ ------ ------ ------ -------- | ------- | Earnings: | Earnings (Loss) Before Income | Taxes, | Minority Interest and | Extraordinary Items $ 412 $ 275 $ 332 $ 208 $ 639 $ 428 $ 310 $ (651) $ (52) | $ (977) Plus: | Interest Expense (a) 84 44 84 42 166 165 213 241 165 | 52 Capitalized Interest (28) (15) (14) (8) (35) (5) (6) (17) (8) | (2) Amortization of Capitalized 2 1 2 1 3 3 2 1 0 | 0 Interest | Portion of Rent Expense | Representative of Interest | Expense (a) 223 113 188 94 400 359 360 337 216 | 117 ----- ----- ----- ----- ----- ----- ----- ----- ----- | ----- 693 418 592 337 1,173 950 879 (89) 321 | (810) ----- ----- ----- ----- ----- ----- ----- ----- ----- | ----- Fixed Charges: | Interest Expense (a) 84 44 84 42 166 165 213 241 165 | 52 Portion of Rent Expense | Representative of Interest | Expense (a) 223 113 188 94 400 359 360 337 216 | 117 ----- ----- ----- ----- ----- ----- ----- ----- ----- | ----- Total Fixed Charges 307 157 272 136 566 524 573 578 381 | 169 ----- ----- ----- ----- ----- ----- ----- ----- ----- | ----- | Coverage Adequacy (Deficiency) $ 386 $ 261 $ 320 $ 201 $ 607 $ 426 $ 306 $(667) $ (60) | $ (979) ===== ===== ===== ===== ===== ===== ===== ===== ===== | ===== | Coverage Ratio 2.26 2.66 2.18 2.48 2.07 1.81 1.53 n/a n/a | n/a ===== ===== ===== ===== ===== ===== ===== ===== ===== | ===== Note: A vertical black line is shown in the table above to separate Continental's post-reorganized consolidated financial data of Holdings since they have not been prepared on a consistent basis of accounting. (a) Includes Fair Market Value Adjustments resulting from the Company's emergence from bankruptcy.

                                                                    EXHIBIT 23.1


                          CONSENT OF ERNST & YOUNG LLP





                         Consent of Independent Auditors

We  consent to the  reference  to our firm under the  caption  "Experts"  in the
Registration   Statement  (Form  S-3)  and  related  Prospectus  of  Continental
Airlines,  Inc. (the "Company") for the registration of  $2,500,000,000  of Pass
Through Certificates and to the incorporation by reference therein of our report
dated  February  9, 1998  (except for Note 13, as to which the date is March 18,
1998), with respect to the consolidated balance sheets of Continental  Airlines,
Inc. as of December 31, 1997 and 1996, and the related  consolidated  statements
of operations,  redeemable  preferred stock and common  stockholders' equity and
cash flows for each of the three years in the period ended December 31, 1997 and
our report dated March 18, 1998 with respect to the related financial  statement
schedule,  all included in the  Company's  1997 Annual  Report (Form 10-K) filed
with the Securities and Exchange Commission.



                              /s/ Ernst & Young LLP

Houston, Texas
August 13, 1998

                                                                    EXHIBIT 24.1
                               POWERS OF ATTORNEY



                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.



                                                  /S/ JEFFERY A. SMISEK
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  JEFFERY A. SMISEK
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997



                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.



                                                  /S/ GORDON M. BETHUNE
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  GORDON M. BETHUNE
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997




                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.



                                                  /S/ LAWRENCE W. KELLNER
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  LAWRENCE W. KELLNER
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997







                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/ MICHAEL P. BONDS
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  MICHAEL P. BONDS
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997








                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/  THOMAS J. BARRACK, JR.
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  THOMAS J. BARRACK, JR.
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997







                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/ DAVID BONDERMAN
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  DAVID BONDERMAN
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997
                                                                       







                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/ GREGORY D. BRENNEMAN
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  GREGORY D. BRENNEMAN
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997












                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/  PATRICK FOLEY
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  PATRICK FOLEY
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997
                                                                     







                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/ DOUGLAS H. MCCORKINDALE
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  DOUGLAS H. MCCORKINDALE
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997







                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/ RICHARD W. POGUE
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  RICHARD W. POGUE
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997






                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/ WILLIAM S. PRICE III
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  WILLIAM S. PRICE III
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997







                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/ DONALD L. STURM
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  DONALD L. STURM
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997








                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.




                                                  /S/ KAREN HASTIE WILLIAMS
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  KAREN HASTIE WILLIAMS
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997







                                POWER OF ATTORNEY

           The  undersigned  director  and/or officer of  Continental  Airlines,
Inc., a Delaware corporation (the "Company"), does hereby constitute and appoint
Lawrence W. Kellner, Jeffery A. Smisek, Jennifer L. Vogel and Scott R. Peterson,
or any of them,  as the  undersigned's  true and lawful  attorneys  in-fact  and
agents to do any and all  things  in the  undersigned's  name and  behalf in the
undersigned's  capacity  as a director  and/or  officer of the  Company,  and to
execute any and all instruments  for the  undersigned  and in the  undersigned's
name and capacity as a director  and/or  officer that such person or persons may
deem  necessary or advisable to enable the Company to comply with the Securities
Act of 1933,  as amended,  and any rules,  regulations  or  requirements  of the
Securities  and  Exchange  Commission  in  connection  with that  certain  shelf
Registration  Statement  on Form S-3 relating to certain of the  Company's  Pass
Through  Certificates  to be  issued  in  connection  with  the  acquisition  or
refinancing of aircraft (the "Registration Statement"),  including specifically,
but not limited  to,  power and  authority  to sign for the  undersigned  in the
capacity as a director and/or officer of the Company the Registration Statement,
and any and all amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.



                                                  /S/ CHARLES A. YAMARONE
                                                  ------------------------------
                                                          (Signature)

                                  Printed Name:  CHARLES A. YAMARONE
                                                 -------------------------------



                                                 Dated and effective as of 
                                                 August 10, 1997


                                                                    EXHIBIT 25.1

        STATEMENT OF ELIGIBILITY OF WILMINGTON TRUST COMPANY ON FORM T-1
                WITH RESPECT TO THE PASS THROUGH TRUST AGREEMENT



                                                                Registration No.
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM T-1

         STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
                  OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK  IF  AN  APPLICATION  TO  DETERMINE  ELIGIBILITY  OF A TRUSTEE PURSUANT TO
SECTION 305(B)(2)  X
                  ---

                            WILMINGTON TRUST COMPANY
               (Exact name of trustee as specified in its charter)

      Delaware                                            51-0055023
(State of incorporation)                    (I.R.S. employer identification no.)

                               Rodney Square North
                            1100 North Market Street
                           Wilmington, Delaware 19890
                    (Address of principal executive offices)

                               Cynthia L. Corliss
                        Vice President and Trust Counsel
                            Wilmington Trust Company
                               Rodney Square North
                           Wilmington, Delaware 19890
                                 (302) 651-8516
            (Name, address and telephone number of agent for service)


                           CONTINENTAL AIRLINES, INC.

               (Exact name of obligor as specified in its charter)

          Delaware                                       74-2099724
   (State of incorporation                  (I.R.S. employer identification no.)
       or formation)

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

                            Pass Through Certificates
                       (Title of the indenture securities)

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




ITEM 1.   GENERAL INFORMATION.

          Furnish the following information as to the trustee:

     (a)  Name  and address  of each examining or supervising authority to which
          it is subject.

          Federal Deposit Insurance Co.         State Bank Commissioner
          Five Penn Center                      Dover, Delaware
          Suite #2901
          Philadelphia, PA

     (b)  Whether it is authorized to exercise corporate trust powers.

          The trustee is authorized to exercise corporate trust powers.

ITEM 2.   AFFILIATIONS WITH THE OBLIGOR.

          If  the  obligor  is  an  affiliate  of  the  trustee,  describe  each
          affiliation:

          Based upon an  examination of the books and records of the trustee and
          upon  information  furnished  by the  obligor,  the  obligor is not an
          affiliate of the trustee.

ITEM 3.   LIST OF EXHIBITS.

          List below all exhibits filed as part of this Statement of Eligibility
     and Qualification.

     A.   Copy of the Charter of Wilmington  Trust  Company,  which includes the
          certificate  of  authority  of  Wilmington  Trust  Company to commence
          business and the authorization of Wilmington Trust Company to exercise
          corporate trust powers.
     B.   Copy of By-Laws of Wilmington Trust Company.
     C.   Consent of  Wilmington  Trust  Company  required by Section  321(b) of
          Trust Indenture Act.
     D.   Copy of most recent Report of Condition of Wilmington Trust Company.

     Pursuant  to  the  requirements  of  the  Trust  Indenture Act of 1939, the
trustee,  Wilmington Trust Company,  a corporation  organized and existing under
the laws of Delaware, has duly caused this Statement of Eligibility to be signed
on its behalf by the undersigned,  thereunto duly authorized, all in the City of
Wilmington and State of Delaware on the 10th day of August, 1998.

[SEAL]                                            WILMINGTON TRUST COMPANY


Attest:  /s/ W. Chris Sponenberg                  By:  /s/ Norma P. Closs
         ---------------------------                   -----------------------
           Assistant Secretary                    Name:  Norma P. Closs
                                                  Title: Vice President





                                    EXHIBIT A

                                 AMENDED CHARTER

                            WILMINGTON TRUST COMPANY

                              WILMINGTON, DELAWARE

                           AS EXISTING ON MAY 9, 1987








                                 AMENDED CHARTER

                                       OR

                              ACT OF INCORPORATION

                                       OF

                            WILMINGTON TRUST COMPANY

          WILMINGTON  TRUST COMPANY,  originally  incorporated  by an Act of the
General  Assembly of the State of Delaware,  entitled "An Act to Incorporate the
Delaware Guarantee and Trust Company", approved March 2, A.D. 1901, and the name
of which company was changed to "WILMINGTON TRUST COMPANY" by an amendment filed
in the Office of the Secretary of State on March 18, A.D.  1903, and the Charter
or Act of  Incorporation of which company has been from time to time amended and
changed by merger agreements pursuant to the corporation law for state banks and
trust  companies  of the  State of  Delaware,  does  hereby  alter and amend its
Charter or Act of Incorporation so that the same as so altered and amended shall
in its entirety read as follows:

          FIRST: - The name of this corporation is WILMINGTON TRUST COMPANY.

          SECOND:  - The  location  of its  principal  office  in the  State  of
          Delaware is at Rodney Square North, in the City of Wilmington,  County
          of New Castle;  the name of its  resident  agent is  WILMINGTON  TRUST
          COMPANY  whose  address  is Rodney  Square  North,  in said  City.  In
          addition to such principal office, the said corporation  maintains and
          operates  branch  offices  in the City of Newark,  New Castle  County,
          Delaware,  the  Town of  Newport,  New  Castle  County,  Delaware,  at
          Claymont,  New Castle  County,  Delaware,  at  Greenville,  New Castle
          County  Delaware,  and at Milford  Cross  Roads,  New  Castle  County,
          Delaware,  and shall be empowered to open, maintain and operate branch
          offices at Ninth and Shipley Streets, 418 Delaware Avenue, 2120 Market
          Street,  and 3605 Market Street,  all in the City of  Wilmington,  New
          Castle  County,  Delaware,  and such other branch offices or places of
          business  as may be  authorized  from  time to time by the  agency  or
          agencies  of the  government  of the State of  Delaware  empowered  to
          confer such authority.

          THIRD:  - (a) The nature of the  business and the objects and purposes
          proposed to be transacted,  promoted or carried on by this Corporation
          are to do any or all of the things  herein  mentioned  as fully and to
          the same extent as natural  persons  might or could do and in any part
          of the world, viz.:

               (1) To sue and be sued,  complain  and defend in any Court of law
               or equity and to make and use a common  seal,  and alter the seal
               at pleasure,  to hold,  purchase,  convey,  mortgage or otherwise
               deal in real and  personal  estate and  property,  and to appoint
               such officers and agents as the business of the Corporation shall



               require,  to make by-laws not inconsistent  with the Constitution
               or laws of the United States or of this State, to discount bills,
               notes or other  evidences of debt, to receive  deposits of money,
               or  securities  for  money,  to buy gold and silver  bullion  and
               foreign coins,  to buy and sell bills of exchange,  and generally
               to use, exercise and enjoy all the powers, rights, privileges and
               franchises   incident  to  a  corporation  which  are  proper  or
               necessary for the  transaction of the business of the Corporation
               hereby created.

               (2) To insure titles to real and personal property, or any estate
               or  interests  therein,  and to  guarantee  the  holder  of  such
               property, real or personal,  against any claim or claims, adverse
               to his interest therein,  and to prepare and give certificates of
               title for any lands or  premises  in the  State of  Delaware,  or
               elsewhere.

               (3) To act as factor,  agent,  broker or attorney in the receipt,
               collection,  custody, investment and management of funds, and the
               purchase,  sale,  management  and  disposal  of  property  of all
               descriptions,  and to prepare and execute all papers which may be
               necessary or proper in such business.

               (4) To prepare and draw  agreements,  contracts,  deeds,  leases,
               conveyances,   mortgages,   bonds  and  legal   papers  of  every
               description,  and to carry on the business of conveyancing in all
               its branches.

               (5) To receive  upon  deposit  for  safekeeping  money,  jewelry,
               plate,  deeds,  bonds and any and all other personal  property of
               every sort and kind, from executors,  administrators,  guardians,
               public officers, courts, receivers, assignees, trustees, and from
               all fiduciaries,  and from all other persons and individuals, and
               from all  corporations  whether  state,  municipal,  corporate or
               private,  and to rent boxes,  safes, vaults and other receptacles
               for such property.

               (6) To act as agent or otherwise for the purpose of  registering,
               issuing,   certificating,    countersigning,    transferring   or
               underwriting  the  stock,  bonds  or  other  obligations  of  any
               corporation,  association, state or municipality, and may receive
               and  manage any  sinking  fund  therefor  on such terms as may be
               agreed upon between the two  parties,  and in like manner may act
               as Treasurer of any corporation or municipality.

               (7) To act as Trustee under any deed of trust, mortgage,  bond or
               other instrument issued by any state, municipality, body politic,
               corporation,   association   or  person,   either   alone  or  in
               conjunction  with any other  person or  persons,  corporation  or
               corporations.

               (8) To  guarantee  the  validity,  performance  or  effect of any
               contract or agreement, and the fidelity of persons holding places



               of  responsibility  or trust; to become surety for any person, or
               persons, for the faithful performance of any trust, office, duty,
               contract or agreement,  either by itself or in  conjunction  with
               any other person, or persons, corporation, or corporations, or in
               like  manner   become   surety   upon  any  bond,   recognizance,
               obligation, judgment, suit, order, or decree to be entered in any
               court of record  within the State of  Delaware or  elsewhere,  or
               which may now or hereafter be required by any law, judge, officer
               or court in the State of Delaware or elsewhere.

               (9) To act by any and every  method of  appointment  as  trustee,
               trustee  in   bankruptcy,   receiver,   assignee,   assignee   in
               bankruptcy, executor, administrator,  guardian, bailee, or in any
               other trust capacity in the  receiving,  holding,  managing,  and
               disposing of any and all estates and property,  real, personal or
               mixed,   and  to  be  appointed  as  such  trustee,   trustee  in
               bankruptcy, receiver, assignee, assignee in bankruptcy, executor,
               administrator,  guardian or bailee by any persons,  corporations,
               court,  officer,  or  authority,  in the  State  of  Delaware  or
               elsewhere;  and whenever this  Corporation is so appointed by any
               person,  corporation,  court,  officer or authority such trustee,
               trustee  in   bankruptcy,   receiver,   assignee,   assignee   in
               bankruptcy, executor, administrator,  guardian, bailee, or in any
               other trust capacity,  it shall not be required to give bond with
               surety, but its capital stock shall be taken and held as security
               for  the  performance  of the  duties  devolving  upon it by such
               appointment.

               (10) And for its care,  management and trouble,  and the exercise
               of any of its powers hereby given,  or for the performance of any
               of the  duties  which  it may  undertake  or be  called  upon  to
               perform,  or for the  assumption of any  responsibility  the said
               Corporation may be entitled to receive a proper compensation.

               (11)  To  purchase,  receive,  hold  and  own  bonds,  mortgages,
               debentures,  shares  of  capital  stock,  and  other  securities,
               obligations,  contracts  and  evidences of  indebtedness,  of any
               private,  public or municipal  corporation within and without the
               State of Delaware,  or of the Government of the United States, or
               of any state, territory, colony, or possession thereof, or of any
               foreign government or country; to receive,  collect, receipt for,
               and dispose of interest,  dividends  and income upon and from any
               of the bonds,  mortgages,  debentures,  notes,  shares of capital
               stock,   securities,   obligations,   contracts,   evidences   of
               indebtedness  and other  property  held and  owned by it,  and to
               exercise  in respect of all such  bonds,  mortgages,  debentures,
               notes,   shares  of  capital  stock,   securities,   obligations,
               contracts,  evidences of indebtedness and other property, any and
               all the  rights,  powers  and  privileges  of  individual  owners
               thereof,  including the right to vote thereon; to invest and deal
               in and  with  any of the  moneys  of the  Corporation  upon  such
               securities and in such manner as it may think fit and proper, and
               from time to time to vary or realize such  investments;  to issue



               bonds  and  secure  the  same by  pledges  or  deeds  of trust or
               mortgages of or upon the whole or any part of the  property  held
               or owned by the  Corporation,  and to sell and pledge such bonds,
               as and when the Board of Directors  shall  determine,  and in the
               promotion of its said corporate business of investment and to the
               extent authorized by law, to lease, purchase, hold, sell, assign,
               transfer,  pledge, mortgage and convey real and personal property
               of any name and nature and any estate or interest therein.

          (b) In furtherance of, and not in limitation,  of the powers conferred
          by the laws of the State of Delaware,  it is hereby expressly provided
          that the said Corporation shall also have the following powers:

               (1) To do any or all of the things herein set forth,  to the same
               extent as natural  persons  might or could do, and in any part of
               the world.

               (2) To acquire the good will, rights, property and franchises and
               to undertake the whole or any part of the assets and  liabilities
               of any person, firm,  association or corporation,  and to pay for
               the same in cash, stock of this Corporation,  bonds or otherwise;
               to hold or in any  manner to  dispose of the whole or any part of
               the property so  purchased;  to conduct in any lawful  manner the
               whole or any part of any  business so  acquired,  and to exercise
               all the powers  necessary or  convenient in and about the conduct
               and management of such business.

               (3) To take,  hold, own, deal in, mortgage or otherwise lien, and
               to lease,  sell,  exchange,  transfer,  or in any manner whatever
               dispose of property, real, personal or mixed, wherever situated.

               (4) To enter into, make, perform and carry out contracts of every
               kind with any person,  firm,  association  or  corporation,  and,
               without  limit as to  amount,  to draw,  make,  accept,  endorse,
               discount,  execute and issue promissory notes,  drafts,  bills of
               exchange,  warrants,  bonds, debentures,  and other negotiable or
               transferable instruments.

               (5) To have  one or more  offices,  to carry on all or any of its
               operations and businesses, without restriction to the same extent
               as natural  persons  might or could do, to purchase or  otherwise
               acquire,  to hold,  own, to mortgage,  sell,  convey or otherwise
               dispose  of,  real and  personal  property,  of every  class  and
               description,  in any State, District,  Territory or Colony of the
               United States, and in any foreign country or place.

               (6) It is the  intention  that the  objects,  purposes and powers
               specified and clauses  contained in this paragraph  shall (except
               where otherwise expressed in said paragraph) be nowise limited or
               restricted  by reference  to or  inference  from the terms of any
               other clause of this or any other paragraph in this charter,  but
               that the objects,  purposes  and powers  specified in each of the



               clauses  of this  paragraph  shall  be  regarded  as  independent
               objects, purposes and powers.

          FOURTH: - (a) The total number of shares of all classes of stock which
          the  Corporation  shall have  authority to issue is forty-one  million
          (41,000,000) shares, consisting of:

               (1) One million  (1,000,000) shares of Preferred stock, par value
               $10.00 per share (hereinafter  referred to as "Preferred Stock");
               and

               (2) Forty million  (40,000,000) shares of Common Stock, par value
               $1.00 per share (hereinafter referred to as "Common Stock").

          (b) Shares of  Preferred  Stock may be issued from time to time in one
          or more series as may from time to time be  determined by the Board of
          Directors each of said series to be distinctly designated.  All shares
          of any  one  series  of  Preferred  Stock  shall  be  alike  in  every
          particular,  except  that  there may be  different  dates  from  which
          dividends,  if any,  thereon shall be cumulative,  if made cumulative.
          The voting powers and the  preferences  and  relative,  participating,
          optional  and  other  special  rights  of each  such  series,  and the
          qualifications,  limitations  or  restrictions  thereof,  if any,  may
          differ from those of any and all other series at any time outstanding;
          and,  subject to the provisions of  subparagraph 1 of Paragraph (c) of
          this Article  FOURTH,  the Board of Directors  of the  Corporation  is
          hereby expressly granted authority to fix by resolution or resolutions
          adopted prior to the issuance of any shares of a particular  series of
          Preferred Stock, the voting powers and the  designations,  preferences
          and   relative,   optional   and  other   special   rights,   and  the
          qualifications,   limitations   and   restrictions   of  such  series,
          including,  but without limiting the generality of the foregoing,  the
          following:

               (1) The  distinctive  designation of, and the number of shares of
               Preferred Stock which shall constitute such series,  which number
               may be increased (except where otherwise provided by the Board of
               Directors)  or  decreased  (but not  below  the  number of shares
               thereof then outstanding) from time to time by like action of the
               Board of Directors;

               (2) The rate and times at which,  and the terms and conditions on
               which, dividends, if any, on Preferred Stock of such series shall
               be paid,  the extent of the  preference  or relation,  if any, of
               such  dividends  to the  dividends  payable on any other class or
               classes,  or  series  of the  same or other  class  of stock  and
               whether such dividends shall be cumulative or non-cumulative;

               (3) The right,  if any, of the holders of Preferred Stock of such
               series to convert the same into or exchange the same for,  shares
               of any other class or classes or of any series of the same or any



               other class or classes of stock of the  Corporation and the terms
               and conditions of such conversion or exchange;

               (4)  Whether  or not  Preferred  Stock  of such  series  shall be
               subject to redemption, and the redemption price or prices and the
               time or times at which,  and the terms and  conditions  on which,
               Preferred Stock of such series may be redeemed.

               (5) The rights, if any, of the holders of Preferred Stock of such
               series upon the  voluntary or  involuntary  liquidation,  merger,
               consolidation,  distribution  or sale of assets,  dissolution  or
               winding-up, of the Corporation.

               (6) The  terms of the  sinking  fund or  redemption  or  purchase
               account,  if any, to be provided for the Preferred  Stock of such
               series; and

               (7) The voting  powers,  if any, of the holders of such series of
               Preferred Stock which may, without limiting the generality of the
               foregoing  include the right,  voting as a series or by itself or
               together  with other series of  Preferred  Stock or all series of
               Preferred Stock as a class, to elect one or more directors of the
               Corporation  if there shall have been a default in the payment of
               dividends on any one or more series of  Preferred  Stock or under
               such  circumstances  and  on  such  conditions  as the  Board  of
               Directors may determine.

          (c) (1) After the requirements with respect to preferential  dividends
          on the  Preferred  Stock (fixed in accordance  with the  provisions of
          section (b) of this Article  FOURTH),  if any, shall have been met and
          after the Corporation  shall have complied with all the  requirements,
          if any,  with respect to the setting aside of sums as sinking funds or
          redemption  or  purchase   accounts  (fixed  in  accordance  with  the
          provisions of section (b) of this Article FOURTH), and subject further
          to any conditions which may be fixed in accordance with the provisions
          of section (b) of this  Article  FOURTH,  then and not  otherwise  the
          holders of Common Stock shall be entitled to receive such dividends as
          may be declared from time to time by the Board of Directors.

               (2) After  distribution in full of the  preferential  amount,  if
               any,  (fixed in accordance  with the provisions of section (b) of
               this  Article  FOURTH),  to be  distributed  to  the  holders  of
               Preferred   Stock  in  the  event  of  voluntary  or  involuntary
               liquidation,  distribution  or sale  of  assets,  dissolution  or
               winding-up,  of the Corporation,  the holders of the Common Stock
               shall be entitled to receive all of the  remaining  assets of the
               Corporation,  tangible and intangible, of whatever kind available
               for  distribution  to  stockholders  ratably in proportion to the
               number of shares of Common Stock held by them respectively.



               (3)  Except  as  may  otherwise  be  required  by  law  or by the
               provisions of such resolution or resolutions as may be adopted by
               the Board of  Directors  pursuant to section (b) of this  Article
               Fourth,  each  holder  of  Common  Stock  shall  have one vote in
               respect of each share of Common  Stock held on all matters  voted
               upon by the stockholders.

          (d) No holder of any of the  shares of any class or series of stock or
          of options,  warrants or other rights to purchase  shares of any class
          or series of stock or of other  securities  of the  Corporation  shall
          have any  preemptive  right to purchase or subscribe  for any unissued
          stock of any class or series or any additional  shares of any class or
          series  to be  issued by  reason  of any  increase  of the  authorized
          capital  stock of the  Corporation  of any class or series,  or bonds,
          certificates   of   indebtedness,   debentures  or  other   securities
          convertible  into or exchangeable  for stock of the Corporation of any
          class or series,  or carrying any right to purchase stock of any class
          or series, but any such unissued stock, additional authorized issue of
          shares of any class or series of stock or securities  convertible into
          or  exchangeable  for stock,  or carrying any right to purchase stock,
          may be issued and disposed of pursuant to  resolution  of the Board of
          Directors  to  such  persons,  firms,  corporations  or  associations,
          whether such  holders or others,  and upon such terms as may be deemed
          advisable  by the  Board  of  Directors  in the  exercise  of its sole
          discretion.

          (e) The  relative  powers,  preferences  and rights of each  series of
          Preferred  Stock in relation to the relative  powers,  preferences and
          rights of each other series of Preferred Stock shall, in each case, be
          as fixed from time to time by the Board of Directors in the resolution
          or resolutions adopted pursuant to authority granted in section (b) of
          this  Article  FOURTH  and the  consent,  by class or  series  vote or
          otherwise,  of the holders of such of the series of Preferred Stock as
          are  from  time to time  outstanding  shall  not be  required  for the
          issuance by the Board of  Directors  of any other  series of Preferred
          Stock whether or not the powers,  preferences and rights of such other
          series  shall be fixed by the Board of Directors as senior to, or on a
          parity with, the powers,  preferences  and rights of such  outstanding
          series, or any of them; provided, however, that the Board of Directors
          may  provide  in the  resolution  or  resolutions  as to any series of
          Preferred Stock adopted pursuant to section (b) of this Article FOURTH
          that the  consent  of the  holders  of a  majority  (or  such  greater
          proportion  as shall be therein  fixed) of the  outstanding  shares of
          such series  voting  thereon shall be required for the issuance of any
          or all other series of Preferred Stock.

          (f) Subject to the provisions of section (e),  shares of any series of
          Preferred  Stock  may be  issued  from  time to time as the  Board  of
          Directors of the Corporation shall determine and on such terms and for
          such consideration as shall be fixed by the Board of Directors.




          (g)  Shares  of Common  Stock  may be issued  from time to time as the
          Board of  Directors of the  Corporation  shall  determine  and on such
          terms  and for such  consideration  as shall be fixed by the  Board of
          Directors.

          (h) The  authorized  amount of shares of Common Stock and of Preferred
          Stock may,  without a class or series vote,  be increased or decreased
          from time to time by the affirmative vote of the holders of a majority
          of the stock of the Corporation entitled to vote thereon.

          FIFTH:  - (a) The  business  and affairs of the  Corporation  shall be
          conducted and managed by a Board of Directors. The number of directors
          constituting  the  entire  Board  shall be not less than five nor more
          than  twenty-five  as fixed from time to time by vote of a majority of
          the whole Board, provided, however, that the number of directors shall
          not be reduced so as to shorten  the term of any  director at the time
          in  office,  and  provided  further,  that  the  number  of  directors
          constituting  the whole Board  shall be  twenty-four  until  otherwise
          fixed by a majority of the whole Board.

          (b) The Board of  Directors  shall be divided into three  classes,  as
          nearly  equal  in  number  as  the  then  total  number  of  directors
          constituting  the whole Board permits,  with the term of office of one
          class  expiring each year. At the annual  meeting of  stockholders  in
          1982, directors of the first class shall be elected to hold office for
          a term expiring at the next succeeding  annual  meeting,  directors of
          the second  class shall be elected to hold office for a term  expiring
          at the second  succeeding  annual  meeting and  directors of the third
          class shall be elected to hold office for a term expiring at the third
          succeeding annual meeting. Any vacancies in the Board of Directors for
          any reason,  and any newly created  directorships  resulting  from any
          increase in the  directors,  may be filled by the Board of  Directors,
          acting by a majority of the  directors  then in office,  although less
          than a quorum, and any directors so chosen shall hold office until the
          next annual election of directors.  At such election, the stockholders
          shall elect a successor to such director to hold office until the next
          election of the class for which such  director  shall have been chosen
          and until his successor shall be elected and qualified. No decrease in
          the  number  of  directors  shall  shorten  the term of any  incumbent
          director.

          (c)  Notwithstanding  any other  provisions  of this Charter or Act of
          Incorporation or the By-Laws of the Corporation  (and  notwithstanding
          the fact that some lesser  percentage  may be specified  by law,  this
          Charter or Act of  Incorporation  or the By-Laws of the  Corporation),
          any director or the entire Board of Directors of the  Corporation  may
          be removed at any time without cause, but only by the affirmative vote
          of the  holders of  two-thirds  or more of the  outstanding  shares of
          capital  stock of the  Corporation  entitled to vote  generally in the
          election of directors  (considered for this purpose as one class) cast
          at a meeting of the stockholders called for that purpose.




          (d) Nominations for the election of directors may be made by the Board
          of Directors or by any  stockholder  entitled to vote for the election
          of  directors.  Such  nominations  shall be made by notice in writing,
          delivered  or  mailed  by first  class  United  States  mail,  postage
          prepaid, to the Secretary of the Corporation not less than 14 days nor
          more than 50 days prior to any meeting of the stockholders  called for
          the election of  directors;  provided,  however,  that if less than 21
          days'  notice of the meeting is given to  stockholders,  such  written
          notice shall be delivered or mailed,  as prescribed,  to the Secretary
          of the  Corporation  not  later  than  the  close of the  seventh  day
          following  the day on  which  notice  of the  meeting  was  mailed  to
          stockholders. Notice of nominations which are proposed by the Board of
          Directors shall be given by the Chairman on behalf of the Board.

          (e) Each  notice  under  subsection  (d) shall set forth (i) the name,
          age, business address and, if known, residence address of each nominee
          proposed in such notice,  (ii) the principal  occupation or employment
          of such  nominee  and  (iii)  the  number  of  shares  of stock of the
          Corporation which are beneficially owned by each such nominee.

          (f) The Chairman of the meeting may, if the facts  warrant,  determine
          and  declare  to the  meeting  that  a  nomination  was  not  made  in
          accordance  with  the  foregoing  procedure,   and  if  he  should  so
          determine,  he shall  so  declare  to the  meeting  and the  defective
          nomination shall be disregarded.

          (g) No action required to be taken or which may be taken at any annual
          or special  meeting of  stockholders  of the  Corporation may be taken
          without  a  meeting,  and the  power of  stockholders  to  consent  in
          writing,   without  a  meeting,   to  the  taking  of  any  action  is
          specifically denied.

          SIXTH: - The Directors shall choose such officers,  agent and servants
          as may be  provided  in the By-Laws as they may from time to time find
          necessary or proper.

          SEVENTH:  - The  Corporation  hereby  created is hereby given the same
          powers,  rights and privileges as may be conferred  upon  corporations
          organized   under  the  Act  entitled  "An  Act  Providing  a  General
          Corporation  Law",  approved  March  10,  1899,  as from  time to time
          amended.

          EIGHTH: - This Act shall be deemed and taken to be a private Act.

          NINTH: - This Corporation is to have perpetual existence.

          TENTH: - The Board of Directors, by resolution passed by a majority of
          the whole Board,  may  designate  any of their number to constitute an
          Executive Committee,  which Committee,  to the extent provided in said
          resolution,  or in the  By-Laws  of the  Company,  shall  have and may
          exercise all of the powers of the Board of Directors in the management
          of the business and affairs of the  Corporation,  and shall have power



          to authorize the seal of the  Corporation  to be affixed to all papers
          which may require it.

          ELEVENTH:  - The  private  property of the  stockholders  shall not be
          liable for the payment of corporate debts to any extent whatever.

          TWELFTH:  - The Corporation  may transact  business in any part of the
          world.

          THIRTEENTH:  - The Board of Directors of the  Corporation is expressly
          authorized to make,  alter or repeal the By-Laws of the Corporation by
          a vote of the majority of the entire Board. The stockholders may make,
          alter or repeal any By-Law  whether or not  adopted by them,  provided
          however,  that any such additional By-Laws,  alterations or repeal may
          be adopted only by the  affirmative  vote of the holders of two-thirds
          or more of the outstanding  shares of capital stock of the Corporation
          entitled to vote  generally in the  election of directors  (considered
          for this purpose as one class).

          FOURTEENTH:  - Meetings of the  Directors  may be held  outside of the
          State  of  Delaware  at  such  places  as may be  from  time  to  time
          designated  by the Board,  and the Directors may keep the books of the
          Company outside of the State of Delaware at such places as may be from
          time to time designated by them.

          FIFTEENTH:  - (a) In addition to any affirmative vote required by law,
          and except as otherwise  expressly provided in sections (b) and (c) of
          this Article FIFTEENTH:

               (A)  any  merger  or  consolidation  of  the  Corporation  or any
               Subsidiary  (as  hereinafter   defined)  with  or  into  (i)  any
               Interested Stockholder (as hereinafter defined) or (ii) any other
               corporation  (whether or not itself an  Interested  Stockholder),
               which, after such merger or consolidation,  would be an Affiliate
               (as hereinafter defined) of an Interested Stockholder, or

               (B) any sale,  lease,  exchange,  mortgage,  pledge,  transfer or
               other  disposition  (in one  transaction  or a series of  related
               transactions)  to or  with  any  Interested  Stockholder  or  any
               Affiliate  of any  Interested  Stockholder  of any  assets of the
               Corporation  or any  Subsidiary  having an aggregate  fair market
               value of $1,000,000 or more, or

               (C) the issuance or transfer by the Corporation or any Subsidiary
               (in one transaction or a series of related  transactions)  of any
               securities of the Corporation or any Subsidiary to any Interested
               Stockholder  or any Affiliate of any  Interested  Stockholder  in
               exchange for cash, securities or other property (or a combination
               thereof)  having an aggregate  fair market value of $1,000,000 or
               more, or

               (D) the adoption of any plan or proposal for the  liquidation  or
               dissolution of the Corporation, or




               (E) any  reclassification  of securities  (including  any reverse
               stock split),  or  recapitalization  of the  Corporation,  or any
               merger  or  consolidation  of  the  Corporation  with  any of its
               Subsidiaries or any similar  transaction  (whether or not with or
               into or otherwise involving an Interested  Stockholder) which has
               the  effect,   directly  or   indirectly,   of   increasing   the
               proportionate  share of the  outstanding  shares  of any class of
               equity  or  convertible  securities  of  the  Corporation  or any
               Subsidiary   which  is  directly  or  indirectly   owned  by  any
               Interested  Stockholder,  or  any  Affiliate  of  any  Interested
               Stockholder,

shall require the affirmative  vote of the holders of at least two-thirds of the
outstanding  shares  of  capital  stock  of the  Corporation  entitled  to  vote
generally  in the  election  of  directors,  considered  for the purpose of this
Article FIFTEENTH as one class ("Voting Shares"). Such affirmative vote shall be
required  notwithstanding  the fact that no vote may be  required,  or that some
lesser percentage may be specified, by law or in any agreement with any national
securities exchange or otherwise.

               (2) The  term  "business  combination"  as  used in this  Article
               FIFTEENTH shall mean any transaction which is referred to any one
               or more of clauses (A) through (E) of  paragraph 1 of the section
               (a).

          (b) The provisions of section (a) of this Article  FIFTEENTH shall not
          be applicable to any particular business combination and such business
          combination shall require only such affirmative vote as is required by
          law and any other provisions of the Charter or Act of Incorporation of
          By-Laws if such business  combination  has been approved by a majority
          of the whole Board.

          (c) For the purposes of this Article FIFTEENTH:

               (1) A "person"  shall mean any  individual  firm,  corporation or
               other entity.

               (2)  "Interested  Stockholder"  shall  mean,  in  respect  of any
               business  combination,  any person (other than the Corporation or
               any  Subsidiary)  who or  which  as of the  record  date  for the
               determination  of stockholders  entitled to notice of and to vote
               on  such  business  combination,  or  immediately  prior  to  the
               consummation of any such transaction:

                    (A) is the beneficial owner, directly or indirectly, of more
                    than 10% of the Voting Shares, or

                    (B) is an  Affiliate  of  the  Corporation  and at any  time
                    within two years  prior  thereto was the  beneficial  owner,
                    directly  or  indirectly,  of not less  than 10% of the then
                    outstanding voting Shares, or



                    (C) is an  assignee  of or has  otherwise  succeeded  in any
                    share of capital stock of the Corporation  which were at any
                    time within two years prior  thereto  beneficially  owned by
                    any   Interested   Stockholder,   and  such   assignment  or
                    succession   shall  have   occurred   in  the  course  of  a
                    transaction or series of transactions not involving a public
                    offering within the meaning of the Securities Act of 1933.

               (3) A  person  shall  be the  "beneficial  owner"  of any  Voting
               Shares:

                    (A)  which  such  person  or  any  of  its   Affiliates  and
                    Associates (as hereafter defined) beneficially own, directly
                    or indirectly, or

                    (B) which such person or any of its Affiliates or Associates
                    has  (i)  the  right  to  acquire  (whether  such  right  is
                    exercisable  immediately or only after the passage of time),
                    pursuant to any agreement,  arrangement or  understanding or
                    upon the exercise of  conversion  rights,  exchange  rights,
                    warrants or options, or otherwise, or (ii) the right to vote
                    pursuant to any agreement, arrangement or understanding, or

                    (C) which are beneficially owned, directly or indirectly, by
                    any other person with which such first  mentioned  person or
                    any of its  Affiliates  or  Associates  has  any  agreement,
                    arrangement or  understanding  for the purpose of acquiring,
                    holding,  voting or disposing of any shares of capital stock
                    of the Corporation.

               (4) The  outstanding  Voting Shares shall  include  shares deemed
               owned  through  application  of paragraph (3) above but shall not
               include any other Voting Shares which may be issuable pursuant to
               any agreement, or upon exercise of conversion rights, warrants or
               options or otherwise.

               (5)  "Affiliate"  and  "Associate"   shall  have  the  respective
               meanings given those terms in Rule 12b-2 of the General Rules and
               Regulations  under the  Securities  Exchange  Act of 1934,  as in
               effect on December 31, 1981.

               (6)  "Subsidiary"  shall mean any corporation of which a majority
               of any class of equity security (as defined in Rule 3a11-1 of the
               General Rules and Regulations  under the Securities  Exchange Act
               of 1934, as in effect in December 31, 1981) is owned, directly or
               indirectly, by the Corporation;  provided,  however, that for the
               purposes of the definition of Investment Stockholder set forth in
               paragraph  (2) of this section (c), the term  "Subsidiary"  shall
               mean only a  corporation  of which a  majority  of each  class of
               equity  security  is  owned,  directly  or  indirectly,   by  the
               Corporation.



          (d)  majority  of the  directors  shall  have  the  power  and duty to
          determine  for the purposes of this Article  FIFTEENTH on the basis of
          information   known  to  them,   (1)  the  number  of  Voting   Shares
          beneficially  owned by any person (2) whether a person is an Affiliate
          or  Associate  of  another,  (3)  whether a person  has an  agreement,
          arrangement or  understanding  with another as to the matters referred
          to in paragraph (3) of section (c), or (4) whether the assets  subject
          to any  business  combination  or the  consideration  received for the
          issuance  or  transfer  of  securities  by  the  Corporation,  or  any
          Subsidiary has an aggregate fair market value of $1,000,000 or more.

          (e) Nothing  contained in this Article FIFTEENTH shall be construed to
          relieve  any  Interested  Stockholder  from any  fiduciary  obligation
          imposed by law.

          SIXTEENTH:  Notwithstanding any other provision of this Charter or Act
          of Incorporation or the By-Laws of the Corporation (and in addition to
          any other vote that may be  required  by law,  this  Charter or Act of
          Incorporation by the By-Laws),  the affirmative vote of the holders of
          at least two-thirds of the outstanding  shares of the capital stock of
          the  Corporation  entitled  to  vote  generally  in  the  election  of
          directors (considered for this purpose as one class) shall be required
          to amend, alter or repeal any provision of Articles FIFTH, THIRTEENTH,
          FIFTEENTH or SIXTEENTH of this Charter or Act of Incorporation.

          SEVENTEENTH: (a) a Director of this Corporation shall not be liable to
          the Corporation or its stockholders for monetary damages for breach of
          fiduciary duty as a Director, except to the extent such exemption from
          liability or limitation  thereof is not  permitted  under the Delaware
          General  Corporation  Laws as the  same  exists  or may  hereafter  be
          amended.

          (b) Any repeal or  modification  of the foregoing  paragraph shall not
          adversely  affect  any  right  or  protection  of a  Director  of  the
          Corporation  existing  hereunder  with  respect to any act or omission
          occurring prior to the time of such repeal or modification."








                                    EXHIBIT B

                                     BY-LAWS


                            WILMINGTON TRUST COMPANY

                              WILMINGTON, DELAWARE

                         AS EXISTING ON JANUARY 16, 1997







                       BY-LAWS OF WILMINGTON TRUST COMPANY


                                    ARTICLE I
                             STOCKHOLDERS' MEETINGS

          Section 1. The Annual  Meeting  of  Stockholders  shall be held on the
third  Thursday in April each year at the principal  office at the Company or at
such other date,  time, or place as may be designated by resolution by the Board
of Directors.

          Section 2. Special  meetings of all  stockholders may be called at any
time by the Board of Directors, the Chairman of the Board or the President.

          Section 3. Notice of all meetings of the  stockholders  shall be given
by mailing to each  stockholder  at least ten (10) days before said meeting,  at
his last known address, a written or printed notice fixing the time and place of
such meeting.

          Section  4. A  majority  in the  amount  of the  capital  stock of the
Company issued and outstanding on the record date, as herein  determined,  shall
constitute a quorum at all meetings of  stockholders  for the transaction of any
business,  but the holders of a small number of shares may adjourn, from time to
time,  without  further  notice,  until a quorum is  secured.  At each annual or
special meeting of stockholders, each stockholder shall be entitled to one vote,
either  in  person  or by proxy,  for each  shares  of stock  registered  in the
stockholder's  name on the books of the  Company on the record date for any such
meeting as determined herein.


                                   ARTICLE II
                                    DIRECTORS

          Section  1. The number and  classification  of the Board of  Directors
shall be as set forth in the Charter of the Bank.

          Section  2. No person who has  attained  the age of  seventy-two  (72)
years shall be nominated  for election to the Board of Directors of the Company,
provided,  however,  that this limitation  shall not apply to any person who was
serving as director of the Company on September 16, 1971.

          Section 3. The class of  Directors  so elected  shall hold  office for
three years or until their successors are elected and qualified.

          Section 4. The  affairs and  business of the Company  shall be managed
and conducted by the Board of Directors.

          Section 5. The Board of Directors  shall meet at the principal  office
of the Company or elsewhere in its  discretion at such times to be determined by
a  majority  of its  members,  or at the call of the  Chairman  of the  Board of
Directors or the President.




          Section 6. Special meetings of the Board of Directors may be called at
any time by the  Chairman of the Board of  Directors  or by the  President,  and
shall be called upon the written request of a majority of the directors.

          Section 7. A majority of the directors  elected and qualified shall be
necessary to constitute a quorum for the  transaction of business at any meeting
of the Board of Directors.

          Section 8. Written  notice  shall be sent by mail to each  director of
any special meeting of the Board of Directors,  and of any change in the time or
place of any regular meeting,  stating the time and place of such meeting, which
shall be mailed not less than two days before the time of holding such meeting.

          Section 9. In the event of the death, resignation,  removal, inability
to act, or  disqualification of any director,  the Board of Directors,  although
less than a quorum,  shall have the right to elect the  successor who shall hold
office for the remainder of the full term of the class of directors in which the
vacancy  occurred,  and until  such  director's  successor  shall have been duly
elected and qualified.

          Section  10. The Board of  Directors  at its first  meeting  after its
election by the  stockholders  shall  appoint an  Executive  Committee,  a Trust
Committee, an Audit Committee and a Compensation Committee, and shall elect from
its own members a Chairman of the Board of Directors  and a President who may be
the same  person.  The Board of  Directors  shall also  elect at such  meeting a
Secretary and a Treasurer,  who may be the same person,  may appoint at any time
such other  committees  and elect or appoint such other  officers as it may deem
advisable.  The Board of  Directors  may also elect at such  meeting one or more
Associate Directors.

          Section 11. The Board of  Directors  may at any time  remove,  with or
without  cause,  any member of any  Committee  appointed by it or any  associate
director or officer elected by it and may appoint or elect his successor.

          Section 12. The Board of Directors  may  designate an officer to be in
charge of such of the  departments  or  division  of the  Company as it may deem
advisable.


                                   ARTICLE III
                                   COMMITTEES

          Section 1.  Executive Committee

               (A) The  Executive  Committee  shall be composed of not more than
nine  members  who  shall be  selected  by the Board of  Directors  from its own
members and who shall hold office during the pleasure of the Board.

               (B) The  Executive  Committee  shall  have all the  powers of the
Board of Directors when it is not in session to transact all business for and in
behalf of the Company that may be brought before it.




               (C) The Executive Committee shall meet at the principal office of
the Company or elsewhere in its  discretion  at such times to be determined by a
majority  of its  members,  or at the  call  of the  Chairman  of the  Executive
Committee or at the call of the Chairman of the Board of Directors. The majority
of its members shall be necessary to constitute a quorum for the  transaction of
business.  Special  meetings of the Executive  Committee may be held at any time
when a quorum is present.

               (D) Minutes of each meeting of the Executive  Committee  shall be
kept and submitted to the Board of Directors at its next meeting.

               (E) The  Executive  Committee  shall advise and  superintend  all
investments  that may be made of the funds of the Company,  and shall direct the
disposal of the same, in accordance with such rules and regulations as the Board
of Directors from time to time make.

               (F) In the event of a state of disaster of sufficient severity to
prevent the conduct and management of the affairs and business of the Company by
its  directors and officers as  contemplated  by these By-Laws any two available
members of the  Executive  Committee as  constituted  immediately  prior to such
disaster  shall  constitute a quorum of that  Committee for the full conduct and
management  of the affairs and  business of the Company in  accordance  with the
provisions  of Article III of these  By-Laws;  and if less than three members of
the Trust Committee is constituted  immediately  prior to such disaster shall be
available for the  transaction of its business,  such Executive  Committee shall
also be empowered to exercise all of the powers  reserved to the Trust Committee
under Article III Section 2 hereof. In the event of the unavailability,  at such
time,  of a  minimum  of two  members  of such  Executive  Committee,  any three
available  directors  shall  constitute  the  Executive  Committee  for the full
conduct and  management of the affairs and business of the Company in accordance
with the foregoing  provisions of this Section.  This By-Law shall be subject to
implementation  by Resolutions of the Board of Directors  presently  existing or
hereafter passed from time to time for that purpose, and any provisions of these
By-Laws (other than this Section) and any resolutions  which are contrary to the
provisions  of  this  Section  or to the  provisions  of any  such  implementary
Resolutions  shall be suspended  during such a disaster period until it shall be
determined by any interim Executive  Committee acting under this section that it
shall be to the advantage of the Company to resume the conduct and management of
its affairs and business under all of the other provisions of these By-Laws.

          Section 2.  Trust Committee

               (A) The  Trust  Committee  shall be  composed  of not  more  than
thirteen members who shall be selected by the Board of Directors,  a majority of
whom shall be members of the Board of Directors and who shall hold office during
the pleasure of the Board.

               (B) The Trust Committee shall have general  supervision  over the
Trust  Department  and the investment of trust funds,  in all matters,  however,
being subject to the approval of the Board of Directors.




               (C) The Trust Committee shall meet at the principal office of the
Company or  elsewhere  in its  discretion  at such times to be  determined  by a
majority  of its  members  or at the call of its  chairman.  A  majority  of its
members  shall be  necessary  to  constitute  a quorum  for the  transaction  of
business.

               (D) Minutes of each meeting of the Trust  Committee shall be kept
and promptly submitted to the Board of Directors.

               (E)  The  Trust   Committee  shall  have  the  power  to  appoint
Committees  and/or  designate  officers  or  employees  of the  Company  to whom
supervision  over the  investment of trust funds may be delegated when the Trust
Committee is not in session.

          Section 3.  Audit Committee

               (A) The Audit  Committee  shall be composed  of five  members who
shall be selected by the Board of Directors  from its own members,  none of whom
shall be an officer of the Company, and shall hold office at the pleasure of the
Board.

               (B) The Audit Committee shall have general  supervision  over the
Audit  Division in all matters  however  subject to the approval of the Board of
Directors; it shall consider all matters brought to its attention by the officer
in charge of the Audit  Division,  review  all  reports  of  examination  of the
Company made by any governmental agency or such independent auditor employed for
that  purpose,  and make such  recommendations  to the Board of  Directors  with
respect thereto or with respect to any other matters  pertaining to auditing the
Company as it shall deem desirable.

               (C) The Audit  Committee  shall meet  whenever  and  wherever the
majority of its members  shall deem it to be proper for the  transaction  of its
business, and a majority of its Committee shall constitute a quorum.

          Section 4.  Compensation Committee

               (A) The Compensation Committee shall be composed of not more than
five (5) members who shall be  selected by the Board of  Directors  from its own
members who are not officers of the Company and who shall hold office during the
pleasure of the Board.

               (B) The  Compensation  Committee shall in general advise upon all
matters  of policy  concerning  the  Company  brought  to its  attention  by the
management  and from time to time review the  management  of the Company,  major
organizational   matters,   including   salaries  and   employee   benefits  and
specifically shall administer the Executive Incentive Compensation Plan.

               (C) Meetings of the  Compensation  Committee may be called at any
time by the Chairman of the Compensation Committee, the Chairman of the Board of
Directors, or the President of the Company.




          Section 5.  Associate Directors

               (A) Any person who has served as a director may be elected by the
Board of Directors as an associate director, to serve during the pleasure of the
Board.

               (B) An  associate  director  shall  be  entitled  to  attend  all
directors  meetings and  participate in the discussion of all matters brought to
the Board,  with the exception that he would have no right to vote. An associate
director will be eligible for appointment to Committees of the Company, with the
exception  of  the  Executive   Committee,   Audit  Committee  and  Compensation
Committee, which must be comprised solely of active directors.

          Section 6.  Absence or Disqualification of Any Member of a Committee

               (A) In the  absence  or  disqualification  of any  member  of any
Committee  created under Article III of the By-Laws of this Company,  the member
or members  thereof  present at any meeting and not  disqualified  from  voting,
whether or not he or they constitute a quorum,  may unanimously  appoint another
member of the Board of  Directors to act at the meeting in the place of any such
absence or disqualified member.


                                   ARTICLE IV
                                    OFFICERS

          Section 1. The Chairman of the Board of Directors shall preside at all
meetings of the Board and shall have such further authority and powers and shall
perform such duties as the Board of  Directors  may from time to time confer and
direct.  He shall also  exercise such powers and perform such duties as may from
time to time be agreed upon between himself and the President of the Company.

          Section 2. The Vice  Chairman of the Board.  The Vice  Chairman of the
Board of  Directors  shall  preside at all meetings of the Board of Directors at
which the Chairman of the Board shall not be present and shall have such further
authority  and powers and shall perform such duties as the Board of Directors or
the Chairman of the Board may from time to time confer and direct.

          Section 3. The President  shall have the powers and duties  pertaining
to the  office of the  President  conferred  or  imposed  upon him by statute or
assigned to him by the Board of  Directors in the absence of the Chairman of the
Board the  President  shall have the powers  and duties of the  Chairman  of the
Board.

          Section 4. The Chairman of the Board of Directors or the  President as
designated  by the  Board of  Directors,  shall  carry  into  effect  all  legal
directions of the Executive  Committee and of the Board of Directors,  and shall
at all  times  exercise  general  supervision  over the  interest,  affairs  and
operations of the Company and perform all duties incident to his office.

          Section  5.  There  may  be  one  or  more  Vice  Presidents,  however
denominated  by the  Board of  Directors,  who may at any time  perform  all the
duties of the Chairman of the Board of Directors  and/or the  President and such



other  powers  and  duties as may from time to time be  assigned  to them by the
Board of Directors,  the Executive  Committee,  the Chairman of the Board or the
President  and by the officer in charge of the  department  or division to which
they are assigned.

          Section  6. The  Secretary  shall  attend  to the  giving of notice of
meetings  of the  stockholders  and  the  Board  of  Directors,  as  well as the
Committees  thereof, to the keeping of accurate minutes of all such meetings and
to recording  the same in the minute  books of the  Company.  In addition to the
other notice  requirements of these By-Laws and as may be practicable  under the
circumstances,  all such notices  shall be in writing and mailed well in advance
of the  scheduled  date of any  other  meeting.  He shall  have  custody  of the
corporate  seal  and  shall  affix  the  same to any  documents  requiring  such
corporate seal and to attest the same.

          Section 7. The  Treasurer  shall  have  general  supervision  over all
assets and liabilities of the Company.  He shall be custodian of and responsible
for all monies, funds and valuables of the Company and for the keeping of proper
records of the evidence of property or indebtedness  and of all the transactions
of the Company.  He shall have general  supervision of the  expenditures  of the
Company and shall report to the Board of  Directors  at each regular  meeting of
the  condition of the Company,  and perform such other duties as may be assigned
to him from time to time by the Board of Directors of the Executive Committee.

          Section  8.  There  may be a  Controller  who shall  exercise  general
supervision over the internal operations of the Company,  including  accounting,
and  shall  render  to the  Board of  Directors  at  appropriate  times a report
relating to the general condition and internal operations of the Company.

          There may be one or more subordinate accounting or controller officers
however  denominated,  who may  perform  the duties of the  Controller  and such
duties as may be prescribed by the Controller.

          Section 9. The officer  designated  by the Board of Directors to be in
charge of the Audit  Division  of the  Company  with such  title as the Board of
Directors shall prescribe,  shall report to and be directly  responsible only to
the Board of Directors.

          There shall be an Auditor and there may be one or more Audit Officers,
however  denominated,  who may  perform  all the duties of the  Auditor and such
duties as may be prescribed by the officer in charge of the Audit Division.

          Section 10. There may be one or more officers,  subordinate in rank to
all Vice Presidents with such functional titles as shall be determined from time
to time by the  Board of  Directors,  who  shall  ex  officio  hold  the  office
Assistant  Secretary  of this  Company and who may perform such duties as may be
prescribed  by the officer in charge of the  department or division to whom they
are assigned.

          Section 11. The powers and duties of all other officers of the Company
shall be those usually  pertaining to their respective  offices,  subject to the



direction of the Board of Directors,  the Executive  Committee,  Chairman of the
Board of Directors or the President and the officer in charge of the  department
or division to which they are assigned.


                                    ARTICLE V
                          STOCK AND STOCK CERTIFICATES

          Section 1. Shares of stock shall be  transferrable on the books of the
Company and a transfer  book shall be kept in which all transfers of stock shall
be recorded.

          Section  2.  Certificate  of stock  shall  bear the  signature  of the
President or any Vice President,  however  denominated by the Board of Directors
and countersigned by the Secretary or Treasurer or an Assistant  Secretary,  and
the seal of the corporation  shall be engraved  thereon.  Each certificate shall
recite that the stock represented  thereby is transferrable  only upon the books
of the Company by the holder  thereof or his  attorney,  upon  surrender  of the
certificate  properly  endorsed.  Any  certificate  of stock  surrendered to the
Company shall be cancelled at the time of transfer, and before a new certificate
or certificates shall be issued in lieu thereof. Duplicate certificates of stock
shall be issued  only upon giving such  security as may be  satisfactory  to the
Board of Directors or the Executive Committee.

          Section 3. The Board of Directors of the Company is  authorized to fix
in advance a record date for the  determination of the stockholders  entitled to
notice of,  and to vote at, any  meeting  of  stockholders  and any  adjournment
thereof, or entitled to receive payment of any dividend,  or to any allotment or
rights,  or to  exercise  any  rights in respect of any  change,  conversion  or
exchange  of capital  stock,  or in  connection  with  obtaining  the consent of
stockholders  for any  purpose,  which record date shall not be more than 60 nor
less than 10 days proceeding the date of any meeting of stockholders or the date
for the payment of any dividend, or the date for the allotment of rights, or the
date when any change or  conversion  or exchange of capital  stock shall go into
effect, or a date in connection with obtaining such consent.


                                   ARTICLE VI
                                      SEAL

          Section 1. The corporate seal of the Company shall be in the following
form:

                    Between two concentric circles the words
                  "Wilmington Trust Company" within the inner
                    circle the words "Wilmington, Delaware."


                                  ARTICLE VII
                                  FISCAL YEAR

          Section 1. The fiscal year of the Company shall be the calendar year.



                                  ARTICLE VIII
                    EXECUTION OF INSTRUMENTS OF THE COMPANY

          Section  1. The  Chairman  of the  Board,  the  President  or any Vice
President,  however denominated by the Board of Directors, shall have full power
and authority to enter into, make, sign, execute, acknowledge and/or deliver and
the Secretary or any Assistant  Secretary shall have full power and authority to
attest  and  affix  the  corporate  seal of the  Company  to any and all  deeds,
conveyances,   assignments,   releases,  contracts,  agreements,  bonds,  notes,
mortgages and all other instruments  incident to the business of this Company or
in acting as executor,  administrator,  guardian, trustee, agent or in any other
fiduciary or  representative  capacity by any and every method of appointment or
by whatever  person,  corporation,  court  officer or  authority in the State of
Delaware, or elsewhere, without any specific authority,  ratification,  approval
or  confirmation by the Board of Directors or the Executive  Committee,  and any
and all such  instruments  shall  have the same  force  and  validity  as though
expressly authorized by the Board of Directors and/or the Executive Committee.


                                   ARTICLE IX
              COMPENSATION OF DIRECTORS AND MEMBERS OF COMMITTEES

          Section 1.  Directors  and associate  directors of the Company,  other
than salaried officers of the Company,  shall be paid such reasonable  honoraria
or fees for  attending  meetings  of the  Board  of  Directors  as the  Board of
Directors may from time to time determine. Directors and associate directors who
serve as members of  committees,  other than salaried  employees of the Company,
shall be paid such  reasonable  honoraria  or fees for  services  as  members of
committees  as the Board of  Directors  shall  from time to time  determine  and
directors  and  associate  directors  may be  employed  by the  Company for such
special  services as the Board of Directors may from time to time  determine and
shall be paid for such special services so performed reasonable  compensation as
may be determined by the Board of Directors.


                                   ARTICLE X
                                INDEMNIFICATION

          Section 1. (A) The Corporation  shall indemnify and hold harmless,  to
the fullest  extent  permitted by applicable  law as it presently  exists or may
hereafter be amended,  any person who was or is made or is threatened to be made
a party or is  otherwise  involved in any action,  suit or  proceeding,  whether
civil,  criminal,  administrative or investigative (a "proceeding") by reason of
the fact that he, or a person for whom he is the legal representative, is or was
a director,  officer,  employee or agent of the Corporation or is or was serving
at the request of the Corporation as a director, officer, employee, fiduciary or
agent  of  another  corporation  or  of a  partnership,  joint  venture,  trust,
enterprise  or  non-profit  entity,  including  service with respect to employee
benefit plans,  against all liability and loss suffered and expenses  reasonably
incurred by such person.  The Corporation shall indemnify a person in connection
with a proceeding initiated by such person only if the proceeding was authorized
by the Board of Directors of the Corporation.



               (B) The Corporation  shall pay the expenses incurred in defending
any proceeding in advance of its final disposition,  provided, however, that the
payment of expenses incurred by a Director officer in his capacity as a Director
or officer in advance of the final  disposition of the proceeding  shall be made
only upon  receipt of an  undertaking  by the  Director  or officer to repay all
amounts  advanced if it should be  ultimately  determined  that the  Director or
officer is not entitled to be indemnified under this Article or otherwise.

               (C) If a claim for indemnification or payment of expenses,  under
this  Article X is not paid in full  within  ninety  days after a written  claim
therefor  has been  received by the  Corporation  the  claimant may file suit 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 any such
action the  Corporation  shall have the burden of proving  that the claimant was
not  entitled to the  requested  indemnification  of payment of  expenses  under
applicable law.

               (D) The rights  conferred  on any person by this  Article X shall
not be  exclusive  of any other  rights  which such person may have or hereafter
acquire  under any statute,  provision  of the Charter or Act of  Incorporation,
these By-Laws,  agreement,  vote of stockholders or  disinterested  Directors or
otherwise.

               (E) Any repeal or  modification  of the  foregoing  provisions of
this Article X shall not adversely  affect any right or protection  hereunder of
any person in respect of any act or omission occurring prior to the time of such
repeal or modification.


                                   ARTICLE XI
                           AMENDMENTS TO THE BY-LAWS

          Section 1. These By-Laws may be altered, amended or repealed, in whole
or in part,  and any new  By-Law or By-Laws  adopted  at any  regular or special
meeting of the Board of  Directors  by a vote of the majority of all the members
of the Board of Directors then in office.



                                   EXHIBIT C


                             SECTION 321(B) CONSENT

          Pursuant  to Section  321(b) of the Trust  Indenture  Act of 1939,  as
amended,  Wilmington  Trust Company hereby consents that reports of examinations
by Federal, State,  Territorial or District authorities may be furnished by such
authorities to the Securities and Exchange Commission upon requests therefor.



                                        WILMINGTON TRUST COMPANY

Dated: August 10, 1998                  By: /s/ Norma P. Closs
                                            ------------------------
                                            Name:  Norma P. Closs
                                            Title: Vice President




                                    EXHIBIT D


                                     NOTICE

          This form is  intended  to assist  state  nonmember  banks and savings
          banks with state publication requirements. It has not been approved by
          any state banking authorities. Refer to your appropriate state banking
          authorities for your state publication requirements.



R E P O R T   O F   C O N D I T I O N

Consolidating domestic subsidiaries of the

        WILMINGTON TRUST COMPANY        of     WILMINGTON
- ----------------------------------------       ----------
              Name of Bank                        City

in the State of DELAWARE , at the close of business on March 31, 1998.



ASSETS
Thousands of dollars Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coins.................. 180,015 Interest-bearing balances............................................ 0 Held-to-maturity securities..................................................... 287,798 Available-for-sale securities................................................... 1,355,745 Federal funds sold and securities purchased under agreements to resell.......... 124,500 Loans and lease financing receivables: Loans and leases, net of unearned income.......... 3,896,238 LESS: Allowance for loan and lease losses........ 61,635 LESS: Allocated transfer risk reserve............ 0 Loans and leases, net of unearned income, allowance, and reserve..... 3,834,603 Assets held in trading accounts................................................. 0 Premises and fixed assets (including capitalized leases)........................ 134,016 Other real estate owned......................................................... 1,444 Investments in unconsolidated subsidiaries and associated companies............. 10 Customers' liability to this bank on acceptances outstanding.................... 0 Intangible assets............................................................... 56,264 Other assets.................................................................... 215,048 Total assets.................................................................... 6,189,443 CONTINUED ON NEXT PAGE LIABILITIES Deposits: In domestic offices............................................................. 4,183,321 Noninterest-bearing............................... 904,511 Interest-bearing.................................. 3,278,810 Federal funds purchased and Securities sold under agreements to repurchase...... 558,553 Demand notes issued to the U.S. Treasury........................................ 57,761 Trading liabilities (from Schedule RC-D)........................................ 0 Other borrowed money:........................................................... /////// With original maturity of one year or less........................... 788,000 With original maturity of more than one year......................... 43,000 Bank's liability on acceptances executed and outstanding........................ 0 Subordinated notes and debentures............................................... 0 Other liabilities (from Schedule RC-G).......................................... 99,777 Total liabilities............................................................... 5,730,412 EQUITY CAPITAL Perpetual preferred stock and related surplus................................... 0 Common Stock.................................................................... 500 Surplus (exclude all surplus related to preferred stock)........................ 62,118 Undivided profits and capital reserves.......................................... 388,458 Net unrealized holding gains (losses) on available-for-sale securities.......... 7,955 Total equity capital............................................................ 459,031 Total liabilities, limited-life preferred stock, and equity capital............. 6,189,443