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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3)*
Continental Airlines, Inc.
(Name of Issuer)
Class A Common Stock and Class B Common Stock
(Title of Class of Securities)
210795209 and 210795308
(CUSIP Number)
James J. O'Brien
201 Main Street, Suite 2420
Fort Worth, Texas 76102
(817) 871-4000
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
April 19, 1996
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box / /.
Check the following box if a fee is being paid with the statement / /.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
**The total number of shares reported herein is 4,267,934 and 4,753,551 of
Class A and Class B shares, respectively, which constitutes approximately
54.6% and 19.1%, respectively, of the total number of Class A and Class B
shares outstanding. The foregoing ownership percentages set forth herein
assume that there are 7,820,790 and 24,875,756 shares of the Class A and Class
B Common Stock, respectively, outstanding pursuant to Rule 13d-3(d)(1)(i)
under the Act. The number of outstanding shares of the Class A and Class B
Common Stock as reported in the Issuer's most recent quarterly report was
6,301,056 and 21,484,074, respectively.
1. Name of Reporting Person:
Air Partners, L.P.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) /X/
3. SEC Use Only
4. Source of Funds: OO-Partnership Contributions
5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e): / /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power:
Class A - 2,740,000 (1)
Number of Class B - 0
Shares
Beneficially 8. Shared Voting Power: -0-
Owned By
Each 9. Sole Dispositive Power:
Reporting Class A - 2,740,000 (1)
Person With Class B - 0
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
Class A - 4,259,734 (2)
Class B - 3,382,632 (3)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Shares:
/x/ See Item 2.
13. Percent of Class Represented by Amount in Row (11):
Class A - 54.5% (2)(4)
Class B - 13.6% (3)(5)
14. Type of Reporting Person: PN
- ------------
(1) Power is exercised through its two general partners, 1992 Air GP and
Air II General, Inc. Additionally, the voting and dispositive power
with respect to the shares of Class A Common Stock held by Air
Partners, L.P. may, under certain circumstances, be deemed to be
shared with, or may be exercised by, the limited partners of Air
Partners, L.P. as further described in Item 6 hereof.
(2) Includes 1,519,734 shares of Class A Common Stock that may be
acquired upon the exercise of warrants.
(3) Includes 3,382,632 shares of Class B Common Stock that may be
acquired upon the exercise of warrants.
(4) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 7,820,790 shares of Class A Common Stock outstanding which
includes the warrants to purchase shares of Class A Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
(5) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 24,872,756 shares of Class B Common Stock outstanding which
includes the warrants to purchase shares of Class B Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
1. Name of Reporting Person:
1992 Air GP
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) /X/
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e): / /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power:
Class A - 0
Class B - 0
Number of 8. Shared Voting Power:
Shares Class A - 2,740,000 (1)(2)
Beneficially Class B - 0
Owned By
Each 9. Sole Dispositive Power:
Reporting Class A - 0
Person With Class B - 0
10. Shared Dispositive Power:
Class A - 2,740,000 (1)(2)
Class B - 0
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
Class A - 4,259,734 (2)(3)
Class B - 3,382,632 (4)(5)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Shares:
/x/ See Item 2.
13. Percent of Class Represented by Amount in Row (11):
Class A - 54.5% (3)(6)
Class B - 13.6% (5)(7)
14. Type of Reporting Person: PN
- -------------
(1) Power is exercised through its majority general partner, 1992 Air,
Inc.
(2) Solely in its capacity as one of two general partners of Air
Partners, L.P. The voting and dispositive power with respect to the
shares of Class A Common Stock held by Air Partners, L.P. may, under
certain circumstances, be deemed to be shared with, or may be
exercised by, the limited partners of Air Partners, L.P. as further
described in Item 6 hereof.
(3) Includes 1,519,734 shares of Class A Common Stock that may be
acquired upon the exercise of warrants held by Air Partners, L.P.
(4) Solely in its capacity as one of two general partners of Air
Partners, L.P. with respect to the 3,382,632 shares of Class B
Common Stock that may be acquired upon the exercise of warrants held
by Air Partners, L.P.
(5) Includes 3,382,632 shares of Class B Common Stock that may be
acquired upon the exercise of warrants held by Air Partners L.P.
(6) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 7,820,790 shares of Class A Common Stock outstanding which
includes the warrants to purchase shares of Class A Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
(7) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 24,872,756 shares of Class B Common Stock outstanding which
includes the warrants to purchase shares of Class B Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
1. Name of Reporting Person:
Air II General, Inc.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) /X/
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e): / /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power:
Class A - 0
Class B - 2,403 (1)
Number of 8. Shared Voting Power:
Shares Class A - 2,740,000 (1)(2)
Beneficially Class B - 0
Owned By
Each 9. Sole Dispositive Power:
Reporting Class A - 0
Person With Class B - 2,403 (1)
10. Shared Dispositive Power:
Class A - 2,740,000 (1)(2)
Class B - 0
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
Class A - 4,259,734 (2)(3)
Class B - 3,385,035 (4)(5)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Shares:
/x/ See Item 2.
13. Percent of Class Represented by Amount in Row (11):
Class A - 54.5% (3)(6)
Class B - 13.6% (5)(7)
14. Type of Reporting Person: CO
- ------------
(1) Power is exercised through its controlling shareholder, David
Bonderman.
(2) Solely in its capacity as one of two general partners of Air
Partners, L.P. The voting and dispositive power with respect to the
shares of Class A Common Stock held by Air Partners, L.P. may, under
certain circumstances, be deemed to be shared with, or may be
exercised by, the limited partners of Air Partners, L.P. as further
described in Item 6 hereof.
(3) Includes 1,519,734 shares of Class A Common Stock that may be
acquired upon the exercise of warrants held by Air Partners, L.P.
(4) Solely in its capacity as one of two general partners of Air
Partners, L.P. with respect to the 3,382,632 shares of Class B
Common Stock that may be acquired upon the exercise of warrants.
(5) Includes 3,382,632 shares of Class B Common Stock that may be
acquired upon the exercise of warrants held by Air Partners, L.P.
(6) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 7,820,790 shares of Class A Common Stock outstanding which
includes the warrants to purchase shares of Class A Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
(7) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 24,872,756 shares of Class B Common Stock outstanding which
includes the warrants to purchase shares of Class B Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
1. Name of Reporting Person:
1992 Air, Inc.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) /X/
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e): / /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power:
Class A - 0
Class B - 781,607 (1) (2)
Number of 8. Shared Voting Power:
Shares Class A - 2,740,000 (1)(3)
Beneficially Class B - 0
Owned By
Each 9. Sole Dispositive Power:
Reporting Class A - 0
Person With Class B - 781,607 (1) (2)
10. Shared Dispositive Power:
Class A - 2,740,000 (1)(3)
Class B - 0
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
Class A - 4,259,734 (3)(4)
Class B - 4,164,239 (3)(5)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Shares:
/x/ See Item 2.
13. Percent of Class Represented by Amount in Row (11):
Class A - 54.5% (4)(6)
Class B - 16.7% (5)(7)
14. Type of Reporting Person: CO
- ------------
(1) Power is exercised through its controlling shareholder, David
Bonderman.
(2) Solely in its capacity as the general partner of Bondo Air, L.P.
with respect to 412,499 shares of Class B Common Stock.
(3) Solely in its capacity as the majority general partner of 1992 Air
GP. The voting and dispositive power with respect to the shares of
Class A Common Stock held by Air Partners, L.P. may, under certain
circumstances, be deemed to be shared with, or may be exercised by,
the limited partners of Air Partners, L.P. as further described in
Item 6 hereof.
(4) Includes 1,519,734 shares of Class A Common Stock that may be
acquired upon the exercise of warrants held by Air Partners, L.P.
(5) Includes 3,382,632 shares of Class B Common Stock that may be
acquired upon the exercise of warrants held by Air Partners, L.P.
and 379,194 shares of Class B Common Stock held directly by 1992 Air
GP.
(6) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 7,820,790 shares of Class A Common Stock outstanding which
includes the warrants to purchase shares of Class A Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
(7) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 24,872,756 shares of Class B Common Stock outstanding which
includes the warrants to purchase shares of Class B Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
1. Name of Reporting Person:
David Bonderman
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) /X/
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e): / /
6. Citizenship or Place of Organization: David Bonderman is a citizen
of the United States of America.
7. Sole Voting Power:
Class A - 8,200 (1)
Class B - 1,367,919 (2)
Number of 8. Shared Voting Power:
Shares Class A - 2,740,000 (3)
Beneficially
Owned By
Each 9. Sole Dispositive Power:
Reporting Class A - 8,200(1)
Person With Class B - 1,367,919 (2)
10. Shared Dispositive Power:
Class A - 2,740,000 (3)
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
Class A - 4,267,934 (1)(3)(4)
Class B - 4,753,551 (2)(5)(6)(9)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Shares:
/x/ See Item 2.
13. Percent of Class Represented by Amount in Row (11):
Class A - 54.6% (4)(7)
Class B - 19.1% (2)(6)(8)(9)
14. Type of Reporting Person: IN
- ------------
(1) Solely in his capacity as general partner of the Bonderman Family
Limited Partnership with respect to 8,200 shares.
(2) Solely in his capacity as general partner of the Bonderman Family
Limited Partnership with respect to 441,225 shares. Solely in his
capacity as the controlling shareholder of 1992 Air, Inc. with
respect to 781,607 shares. Solely in his capacity as the
controlling shareholder of Air II General, Inc. with respect to
2,403 shares.
(3) Solely in his capacities as the controlling shareholder of each of
Air II General, Inc. and 1992 Air, Inc. with respect to 2,740,000
shares Class A Common Stock held by Air Partners, L.P. The voting
and dispositive power with respect to the shares of Class A Common
Stock and Class B Common Stock held by Air Partners, L.P. may, under
certain circumstances, be deemed to be shared with, or may be
exercised by, the limited partners of Air Partners, L.P. as further
described in Item 6 hereof.
(4) Includes 1,519,734 shares of Class A Common Stock that may be
acquired upon the exercise of warrants held by Air Partners, L.P..
(5) Solely in his capacity as the controlling shareholder of each of Air
II General, Inc. and 1992 Air, Inc. with respect to the 3,382,632
shares of Class B Common Stock that may be acquired upon the
exercise of warrants held by Air Partners, L.P.
(6) Includes 3,382,632 shares of Class B Common Stock that may be
acquired upon the exercise of warrants held by Air Partners, L.P.
(7) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 7,820,790 shares of Class A Common Stock outstanding which
includes the warrants to purchase shares of Class A Common Stock
held by Air Partners, L.P. but does not include warrants held by any
other persons.
(8) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 24,875,756 shares of Class B Common Stock outstanding which
includes the warrants to purchase shares of Class B Common Stock
held by Air Partners, L.P. and the director options held by Mr.
Bonderman but does not include warrants held by any other persons.
(9) Includes 3,000 shares of Class B Common Stock that may be acquired
by Mr. Bonderman upon the exercise of outside director stock
options.
1. Name of Reporting Person:
Bonderman Family Limited Partnership
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) /X/
3. SEC Use Only
4. Source of Funds: WC
5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e): / /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power:
Class A - 8,200 (1)
Class B - 441,225 (1)
Number of 8. Shared Voting Power:
Shares Class A - 46,322 (2)
Beneficially Class B - 0
Owned By
Each 9. Sole Dispositive Power:
Reporting Class A - 8,200 (1)
Person With Class B - 441,225 (1)
10. Shared Dispositive Power:
Class A - 46,322 (2)
Class B - 0
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
Class A - 80,215 (2)(3)
Class B - 498,412 (2)(4)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Shares:
/x/ See Item 2.
13. Percent of Class Represented by Amount in Row (11):
Class A - 1.3% (3)(5)
Class B - 2.3% (4)(6)
14. Type of Reporting Person: PN
- ------------
(1) Power is exercised through its general partner, David Bonderman.
(2) Bonderman Family Limited Partnership also holds a limited
partnership interest in Air Partners, L.P. On the basis of certain
provisions of the Partnership Agreement, Bonderman Family Limited
Partnership may be deemed to beneficially own the shares of Class A
Common Stock and Class B Common Stock beneficially owned by Air
Partners, L.P. that are attributable to such limited partnership
interest. Pursuant to Rule 13d-4 under the Act, Bonderman Family
Limited Partnership disclaims beneficial ownership of all such
shares.
(3) Includes 25,693 shares of Class A Common Stock that may be acquired
upon the exercise of warrants held by Air Partners, L.P. and
attributable to the limited partnership interest in Air Partners,
L.P. held by Bonderman Family Limited Partnership.
(4) Includes 57,187 shares of Class B Common Stock that may be acquired
upon the exercise of warrants held by Air Partners, L.P. and
attributable to the limited partnership interest in Air Partners,
L.P. held by Bonderman Family Limited Partnership.
(5) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 6,326,749 shares of Class A Common Stock outstanding which
includes the warrants to purchase Class A Common Stock held by Air
Partners, L.P. and attributable to the Bonderman Family Limited
Partnership pursuant to the Partnership Agreement but does not
include warrants held by any other persons.
(6) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 21,547,311 shares of Class B Common Stock Outstanding which
includes the warrants to purchase Class B Common Stock held by Air
Partners, L.P. and attributable to the Bonderman Family Limited
Partnership pursuant to the Partnership Agreement but does not
include warrants held by any other persons.
1. Name of Reporting Person:
Bondo Air Limited Partnership
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) /X/
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e): / /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power:
Class A - 0
Class B - 412,499
Number of
Shares 8. Shared Voting Power:
Beneficially Class A - 463,230 (1)
Owned By Class B - 0
Each
Reporting 9. Sole Dispositive Power:
Person With Class A - 0
Class B - 412,499
10. Shared Dispositive Power:
Class A - 463,230 (1)
Class B - 0
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
Class A - 720,159 (1)(2)
Class B - 984,374 (3)(4)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Shares:
/X/ See Item 2.
13. Percent of Class Represented by Amount in Row (11):
Class A - 11.0% (2)(5)
Class B - 4.5% (4)(6)
14. Type of Reporting Person: PN
- -----------
(1) Solely in its capacity as a limited partner of Air Partners, L.P.
On the basis of certain provisions of the Partnership Agreement,
Bondo Air Limited Partnership ("Bondo Air") may be deemed to
beneficially own the shares of Class A Common Stock and Class B
Common Stock beneficially owned by Air Partners, L.P. that are
attributable to such limited partnership interests. Pursuant to
Rule 13d-4 under the Act, Bondo Air disclaims beneficial ownership
of all such shares.
(2) Includes 256,929 shares of Class A Common Stock that may be acquired
upon the exercise of warrants held by Air Partners, L.P. and
attributable to the limited partnership interest in Air Partners,
L.P. held by Bondo Air.
(3) Solely in its capacity as a limited partner of Air Partners, L.P.
with respect to 571,875 shares of Class B Common Stock that may be
acquired upon the exercise of warrants held by Air Partners and that
may be attributable to the limited partnership interests held by
Bondo Air pursuant to the Partnership Agreement.
(4) Includes 571,875 shares of Class B Common Stock that may be acquired
upon the exercise of warrants held by Air Partners, L.P. and
attributable to the limited partnership interests in Air Partners,
L.P. held by Bondo Air.
(5) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 6,557,985 shares of Class A Common Stock outstanding which
includes the warrants to purchase Class A Common Stock held by Air
Partners, L.P. and attributable to the limited partnership interest
held by Bondo Air pursuant to the Partnership Agreement but does not
include warrants held by any other persons.
(6) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 22,061,999 shares of Class B Common Stock outstanding which
includes the warrants to purchase Class B Common Stock held by Air
Partners, L.P. and attributable to the limited partnership interest
held by Bondo Air pursuant to the Partnership Agreement but does not
include warrants held by any other persons.
1. Name of Reporting Person:
Alfredo Brener
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) /X/
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e): / /
6. Citizenship or Place of Organization: Alfredo Brener is a citizen of
Mexico.
7. Sole Voting Power:
Class A - 0
Class B - 406,312 (1)
Number of
Shares 8. Shared Voting Power:
Beneficially Class A - 456,282 (1)
Owned By Class B - 0
Each
Reporting 9. Sole Dispositive Power: -0-
Person With Class A - 0
Class B - 406,312 (1)
10. Shared Dispositive Power:
Class A - 456,282 (1)
Class B - 0
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
Class A - 709,357 (1)(2)
Class B - 969,609 (1)(3)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Shares:
/x/ See Item 2.
13. Percent of Class Represented by Amount in Row (11):
Class A - 10.8% (2)(4)
Class B - 4.4% (3)(5)
14. Type of Reporting Person: IN
- ------------
(1) Because Alfredo Brener, through a limited partnership whose
corporate general partner he controls, owns warrants to purchase a
98.5% limited partnership interest in Bondo Air, and on the basis of
certain provisions of the limited partnership agreement of Bondo
Air, Alfredo Brener may be deemed to beneficially own 98.5% of the
shares of Class A Common Stock and Class B Common Stock beneficially
owned by Bondo Air or that may be deemed to be beneficially owned by
Bondo Air that are attributable to Bondo Air's limited partnership
interest in Air Partners. Pursuant to Rule 13d-4 under the Act, Mr.
Brener disclaims beneficial ownership of all such shares.
(2) Includes 253,075 shares of Class A Common Stock that may be acquired
upon the exercise of warrants held by Air Partners, L.P. and
attributable to 98.5% of the limited partnership interest in Air
Partners, L.P. held by Bondo Air.
(3) Includes 563,297 shares of Class B Common Stock that may be acquired
upon the exercise of warrants held by Air Partners, L.P. and
attributable to 98.5% of the limited partnership interest in Air
Partners, L.P. held by Bondo Air.
(4) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 6,554,131 shares of Class A Common Stock outstanding which
includes the warrants to purchase Class A Common Stock held by Air
Partners, L.P. and attributable to Bondo Air Limited Partnership
pursuant to the Partnership Agreement but does not include warrants
held by any other persons.
(5 Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there
are 22,053,421 shares of Class B Common Stock outstanding which
includes the warrants to purchase Class B Common Stock held by Air
Partners, L.P. and attributable to Bondo Air Limited Partnership
pursuant to the Partnership Agreement but does not include warrants
held by any other persons.
Pursuant to Rule 13d-2(a) of Regulation 13D-G of the General Rules
and Regulations under the Securities Exchange Act of 1934, as amended (the
"Act"), the undersigned hereby amend their Schedule 13D Statement dated August
8, 1995, as amended by Amendment No. 1 dated August 11, 1995 and Amendment No.
2 dated April 3, 1996 (the "Schedule 13D"), relating to the shares of Class A
Common Stock, par value $.01 per share ("Class A Stock"), and Class B Common
Stock, par value $.01 per share ("Class B Stock"), of Continental Airlines,
Inc. (the "Issuer"). Unless otherwise indicated, all defined terms used
herein shall have the same meanings respectively ascribed to them in the
Schedule 13D.
ITEM 1. SECURITY AND ISSUER.
No material change.
ITEM 2. IDENTITY AND BACKGROUND.
No material change.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
No material change.
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 is hereby partially amended by adding at the end thereof, the
following:
Reference is hereby made to the disclosure contained in Item 6
hereof, which is hereby incorporated herein in its entirety.
ITEM 5. INTERESTS IN SECURITIES OF THE ISSUER.
Paragraphs (a)-(c) of Item 5 are hereby amended and restated in their
entireties as follows:
(a)
AIR PARTNERS
The aggregate number of shares of the Class A Stock that Air Partners
owns beneficially, pursuant to Rule 13d-3 under the Act, is 4,259,734, which
constitutes approximately 54.5% of the 7,820,790 shares of such stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act. The aggregate
number of shares of the Class B Stock that Air Partners owns beneficially,
pursuant to Rule 13d-3 under the Act, is 3,382,632, which constitutes
approximately 13.6% of the 24,872,756 shares of such stock deemed outstanding
pursuant to Rule 13d-3(d)(1)(i) under the Act.
1992 AIR GP
Because of its position as one of two general partners of Air
Partners, 1992 Air GP may, pursuant to Rule 13d-3 of the Act, be deemed to be
the beneficial owner of 4,259,734 shares of the Class A Stock, which
constitutes approximately 54.5% of the 7,820,790 shares of such stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act, and 3,382,632
shares of the Class B Stock, which constitutes approximately 13.6% of the
24,872,756 shares of such stock deemed outstanding pursuant to Rule 13d-
3(d)(1)(i) under the Act.
AIR II
Because of its position as one of two general partners of Air
Partners, and because of its direct ownership of 2,403 shares of the Class B
Stock Air II may, pursuant to Rule 13d-3 of the Act, be deemed to be the
beneficial owner of (i) 4,259,734 shares of the Class A Stock, which
constitutes approximately 54.5% of the 7,820,790 shares of such stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act, and (ii) an
aggregate 3,385,035 shares of the Class B Stock, which constitutes
approximately 13.6% of the 24,872,756 shares of such stock deemed outstanding
pursuant to Rule 13d-3(d)(1)(i) under the Act.
AIR, INC.
Because of its position as one of two general partners of 1992 Air
GP, because of its position as the general partner of Bondo Air, and because
of its direct ownership of 369,108 shares of the Class B Stock, Air, Inc.,
may, pursuant to Rule 13d-3 of the Act, be deemed to be the beneficial owner
of (i) 4,259,734 shares of the Class A Stock, which constitutes approximately
54.5% of the 7,820,790 shares of such stock deemed outstanding pursuant to
Rule 13d-3(d)(1)(i) under the Act, and (ii) and aggregate of 4,164,239 shares
of the Class B Stock, which constitutes approximately 16.7% of the 24,872,756
shares of such stock deemed outstanding pursuant to Rule 13d-3(d)(1)(i) under
the Act.
BONDERMAN
Because of his position as the controlling shareholder of each of Air
II and Air, Inc., and as the general partner of Bonderman Family, and because
he holds a director stock option to acquire 3,000 shares of the Class B Stock,
and because of his direct ownership of 142,684 shares of the Class B Stock,
Bonderman may, pursuant to Rule 13d-3 of the Act, be deemed to be the
beneficial owner of (i) 4,267,934 shares of the Class A Stock, which
constitutes approximately 54.6% of the 7,820,790 shares of such stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act, and (ii) an
aggregate 4,753,551 shares of the Class B Stock, which constitutes
approximately 19.1% of the 24,875,756 shares of such stock deemed outstanding
pursuant to Rule 13d-3(d)(1)(i) under the Act.
BONDERMAN FAMILY
The aggregate number of shares of the Class A Stock that Bonderman
Family owns, or may be deemed to own, beneficially, pursuant to Rule 13d-3
under the Act, is 80,215, 8,200 shares of which Bonderman Family owns directly
and 72,015 shares of which Bonderman Family may be deemed to own beneficially
because of its position as a limited partner of Air Partners, and on the basis
of certain provisions of the Partnership Agreement. In the aggregate, such
shares of Class A Stock constitute approximately 1.3% of the 6,326,749 shares
of such stock deemed outstanding pursuant to Rule 13d-3(d)(1)(i) under the
Act. The aggregate number of shares of the Class B Stock that Bonderman
Family owns, or may be deemed to own, beneficially, pursuant to Rule 13d-3
under the Act, is 498,412, 441,225 of which Bonderman Family owns directly and
57,187 of which Bonderman Family may be deemed to own beneficially because of
its position as a limited partner of Air Partners, and on the basis of certain
provisions of the Partnership Agreement. Such shares of Class B Stock in the
aggregate constitute approximately 2.3% of the 21,547,311 shares of such stock
deemed outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act. Pursuant to
Rule 13d-4 under the Act, Bonderman Family disclaims beneficial ownership of
all such shares attributable to Bonderman Family's limited partnership
interest in Air Partners.
BONDO AIR
Because of its position as a limited partner of Air Partners, and on
the basis of certain provisions of the Partnership Agreement, Bondo Air may,
pursuant to Rule 13d-3 of the Act, be deemed to own beneficially 720,159
shares of the Class A Stock, which constitutes approximately 11.0% of the
6,557,985 shares of such stock deemed outstanding pursuant to Rule 13d-
3(d)(1)(i) under the Act. The aggregate number of shares of the Class B Stock
that Bondo Air owns, or may be deemed to own, beneficially, pursuant to Rule
13d-3 under the Act, is 984,374, 412,499 of which Bondo Air owns directly and
571,875 of which Bondo Air may be deemed to own beneficially because of its
position as a limited partner of Air Partners, and on the basis of certain
provisions of the Partnership Agreement. Such shares of Class B Stock in the
aggregate constitute approximately 4.5% of the 22,061,999 shares of such stock
deemed outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act. Pursuant to
Rule 13d-4 under the Act, Bondo Air disclaims beneficial ownership of all such
shares attributable to Bondo Air's limited partnership interest in Air
Partners.
BRENER
Because of his ownership, through a limited partnership whose
corporate general partner he controls, of warrants to purchase a 98.5% limited
partnership interest in Bondo Air, and on the basis of certain provisions of
the limited partnership agreement of Bondo Air and the Partnership Agreement,
Brener may, pursuant to Rule 13d-3 under the Act, be deemed to be the
beneficial owner of 709,357 shares of the Class A Stock, which constitutes
approximately 10.8% of the 6,554,131 shares of such stock deemed outstanding
pursuant to Rule 13d-3(d)(1)(i) under the Act and 969,608 shares of the Class
B Stock, which constitutes approximately 4.4% of the 22,053,421 shares of such
stock deemed outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act.
Pursuant to Rule 13d-4 under the Act, Brener disclaims beneficial ownership of
all such shares attributable to Bondo Air's limited partnership interest in
Air Partners.
To the best knowledge of each of the Reporting Persons, other than
as set forth above, none of the persons named in response to Item 2(a) herein
is the beneficial owner of any shares of the Class A Stock or the Class B
Stock.
(b)
AIR PARTNERS
Acting through its two general partners, Air Partners has the sole
power to vote or to direct the vote and to dispose or to direct the
disposition of 2,740,000 shares of the Class A Stock and has no power to vote
or to direct the vote of any shares of the Class B Stock. Additionally, the
voting and dispositive power with respect to the shares of Class A Common
Stock held by Air Partners may, under certain circumstances, be deemed to be
shared with, or may be exercised by, the limited partners of Air Partners as
further described in Item 6 hereof.
1992 AIR GP
In its capacity as one of two general partners of Air Partners, and
acting through its majority general partner, 1992 Air GP has the shared power
to vote or to direct the vote and to dispose or to direct the disposition of
2,740,000 shares of the Class A Stock.
AIR II
In its capacity as one of two general partners of Air Partners, and
acting through its controlling shareholder, Air II has the shared power to
vote or to direct the vote and to dispose or to direct the disposition of
2,740,000 shares of the Class A Stock. Acting through its controlling
shareholder, Air II has the sole power to vote or to direct the vote and to
dispose or to direct the disposition of 2,403 shares of the Class B Stock.
AIR, INC.
In its capacities as the majority general partner of 1992 Air GP and
the general partner of Bondo Air, and acting through its controlling
shareholder, Air, Inc. has the shared power to vote or to direct the vote and
to dispose or to direct the disposition of 2,740,000 shares of the Class A
Stock and the sole power to vote or to direct the vote and to dispose or to
direct the disposition of 781,607 shares of the Class B Stock.
BONDERMAN
In his capacity as the controlling shareholder of each of Air II and
Air, Inc., Bonderman has the shared power to vote or to direct the vote and to
dispose or to direct the disposition of 2,740,000 shares of the Class A Stock
and the sole power to vote or to direct the vote and to dispose or to direct
the disposition of 784,010 shares of the Class B Stock. In his capacity as
sole general partner of Bonderman Family, Bonderman has the sole power to vote
or to direct the vote and to dispose or to direct the disposition of 8,200
shares of the Class A Stock and 441,225 shares of the Class B Stock.
Bonderman has the sole power to vote or to direct the vote and to dispose or
to direct the disposition of 142,684 shares of Class B Common Stock.
Additionally, because of Bonderman's ownership of direct and indirect limited
partnership interests in Air Partners, and on the basis of certain provisions
of the Partnership Agreement, Bonderman may be deemed to have shared power to
vote or to direct the vote and to dispose or to direct the disposition of
shares of Class A Stock beneficially owned by Air Partners attributable to
such limited partnership interests in Air Partners.
BONDERMAN FAMILY
Acting through its sole general partner, Bonderman Family has the
sole power to vote or to direct the vote and to dispose or to direct the
disposition of 8,200 shares of the Class A Stock and 441,225 shares of the
Class B Stock. Additionally, because of its ownership of a limited
partnership interest in Air Partners, and on the basis of certain provisions
of the Partnership Agreement, Bonderman Family may be deemed to have shared
power to vote or to direct the vote and to dispose or to direct the
disposition of 46,322 shares of Class A Stock.
BONDO AIR
In its capacity as a limited partner of Air Partners, and on the
basis of certain provisions of the Partnership Agreement, Bondo Air may be
deemed to have shared power to vote or to direct the vote and to dispose or to
direct the disposition of 463,230 shares of the Class A Stock attributable to
Bondo Air's limited partnership interest in Air Partners. Bondo Air has the
sole power to vote or to direct the vote and to dispose or to direct the
disposition of 412,499 shares of Class B Stock.
BRENER
Because of his ownership, through a limited partnership whose
corporate general partner he controls, of warrants to purchase a 98.5% limited
partnership interest in Bondo Air, and on the basis of certain provisions of
the limited partnership agreement of Bondo Air and the Partnership Agreement,
Brener may be deemed to have shared power to vote or to direct the vote and to
dispose or to direct the disposition of 456,282 shares of the Class A Stock
attributable to Bondo Air's limited partnership interest in Air Partners.
Because of his ownership, through a limited partnership whose corporate
general partner he controls, of warrants to purchase a 98.5% limited
partnership interest in Bondo Air, Brener may be deemed to have the sole power
to vote or to direct the vote and to dispose or to direct the disposition of
406,312 shares of the Class B Stock held by Bondo Air.
(c) As of April 19, 1996, 1992 Air GP distributed 379,194 shares of
Class B Stock to its partners in a pro rata in kind distribution. In the
distribution, Air Inc. received 369,108 shares of Class B Stock. No
consideration was paid by the partners in connection with the distribution.
Except as set forth in this paragraph (c), to the best of the
knowledge of each of the Reporting Persons, none of the persons named in
response to paragraph (a) has effected any transactions in the shares of the
Class A Stock or Class B Stock since the most recent filing on Schedule 13D.
(d)-(e)
No material change.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
Item 6 is hereby partially amended by adding at the end thereof, the
following:
Except as disclosed in this Schedule 13D (including the original
Schedule 13D filing, as amended), the Reporting Persons know of no contracts,
arrangements, understandings or relationships between or among themselves, or
between the Reporting Persons and any other person, with respect to any
securities of the Issuer.
On April 19, 1996, Air Partners entered into certain agreements with
the Issuer and Air Canada, a Canadian corporation ("Air Canada"), with respect
to securities of the Issuer, which are described below. The descriptions set
forth in this Item 6 of the Amendment to Subscription and Stockholders'
Agreement, dated as of April 19, 1996, among the Issuer, Air Partners and Air
Canada (the "Stockholders' Agreement Amendment"), and the Amended and Restated
Registration Rights Agreement, dated as of April 19, 1996, among the Issuer,
Air Partners and Air Canada (the "Restated Registration Rights Agreement") do
not purport to be complete and are qualified in their entirety by reference to
such agreements, each of which is being filed as an exhibit to this Schedule
13D.
STOCKHOLDERS AGREEMENT AMENDMENT
The Stockholders' Agreement Amendment amends certain provisions of
the Subscription and Stockholders' Agreement, dated as of April 27, 1993,
among Air Partners, Air Canada and the Issuer (the "Original Stockholders'
Agreement"), a copy of which was filed as Exhibit 4.1 with the Original
Schedule 13D, and sets forth new agreements among the parties thereto.
Pursuant to the Stockholders' Agreement Amendment, the Issuer agreed to
register under the Securities Act of 1933, as amended (the "Registration"), up
to 2,200,000 shares of Class B Common Stock beneficially owned by Air Canada
and up to an aggregate of 2,742,733 shares of Class B Common Stock
beneficially owned by the partners in Air Partners and to engage Merrill
Lynch & Co. as lead underwriter to conduct an underwritten offering of such
shares on a firm commitment basis (the "Offering"). On April 22, 1996 the
Issuer made an initial filing of a Registration Statement on Form S-3 relating
to the Offering.
It is currently anticipated that the number of shares owned
beneficially by Reporting Persons to be included for sale in the Registration
and Offering will be as follows:
REPORTING PERSON NUMBER OF SHARES REGISTERED FOR SALE
Bonderman 114,586
Bonderman Family 33,219
Air Inc. 305,456
Air II 2,403
Bondo Air (1) 412,499
_____________
(1) As reported on his cover page to this Schedule 13D, because of
his indirect ownership of warrants to purchase a 98.5% interest in Bondo Air,
and on the basis of certain provisions of the limited partnership agreement of
Bondo Air, Brenner may be deemed to beneficially own 98.5% of such shares.
Pursuant to Rule 13d-4 under the Act, Brenner disclaims beneficial ownership
of such shares.
Air Partners and Air Canada have also agreed, among other things, to
amend the Original Stockholders' Agreement to (i) delete the purchase options,
rights of first refusal and other restrictions on the transfer of the Issuer's
securities, (ii) eliminate the voting arrangement between Air Partners and Air
Canada relating to the election of persons designated by each such party as
directors of the Issuer and (iii) allocate the six demand registrations
granted by the Issuer under the Restated Registration Rights Agreement, four
to Air Partners and two to Air Canada. In addition, Air Canada further agreed
that it will (a) convert, on a share for share basis, its 1,661,056 shares of
Class A Common Stock (which entitles the holder thereof to 10 votes per share)
into an equivalent number of shares of Class B Common Stock (which entitles
the holder thereof to 1 vote per share) and irrevocably waive its right to
exchange 1,078,944 shares of Class B Common Stock for an equivalent number of
shares of Class A Common Stock, (b) grant an irrevocable proxy (the "Air
Canada Proxy") to Air Partners to enable Air Partners to vote Air Canada's
shares of the Issuer's common stock at the upcoming annual meeting with
respect to the election of directors, approval of certain amendments to the
Issuer's Amended and Restated Certificate of Incorporation, and approval of
amendments to certain employee benefit-related contracts and other matters or,
if Air partners is in any way precluded from exercising such proxy, Air Canada
has agreed to vote its shares in favor of the Issuer's proposals at the annual
stockholders' meeting of the Issuer, (c) irrevocably waive its right to
exchange shares of Class B Common Stock for Class A Common Stock and (d) to
cause each of its designees to the Board of Directors of the Issuer to resign
at any time following the closing of the Offering upon the request of the
Issuer. The aforementioned agreements will become effective only upon the
closing of the Offering.
Air Partners intends to vote its shares of the Issuer's common stock
and the shares covered by the Air Canada Proxy at the annual stockholders'
meeting of the Issuer in favor of the proposed amendments to the Issuer's
Certificate of Incorporation, which provide for, among other things, a change
in the number of directors from 18 to such number as may be determined from
time to time by the Board in accordance with the By-Laws (currently
anticipated to be 12), the ability of holders of the Issuer's Class D common
stock to elect one-third of the number of directors determined by the Board
(rounded to the nearest whole number), the deletion of Class C common stock
and the deletion of Air Canada's preemptive rights.
Finally, Air Partners agreed that prior to December 16, 1996, without
the prior written consent of the Issuer, it would not enter into transactions
in securities of the Issuer that would, pursuant to Section 382 of the
Internal Revenue Code, have an adverse effect on the ability of the Issuer to
fully utilize its net operating losses. This agreement was effective as of
April 19, 1996.
RESTATED REGISTRATION RIGHTS AGREEMENT
The "Restated Registration Rights Agreement" amended and restated in
its entirety the Registration Rights Agreement among Air Partners, Air Canada
and the Issuer dated as of April 27, 1993, a copy of which was filed as
Exhibit 4.3 with the original Schedule 13D. Under Sections 2.1(a) and (b) of
the Restated Registration Rights Agreement, the aggregate number of demand
registrations of Registrable Securities (as defined in the Restated
Registration Rights Agreement) to which Air Partners and Air Canada are
entitled will be increased from four to six upon the closing of the Offering,
with such rights bearing allocated four to Air Partners and two to Air Canada.
Section 2.2(a) of the Restated Registration Rights Agreement also provides Air
Partners and Air Canada incidental registration rights commencing on the date
of the closing of the Offering to and including the twelfth anniversary
thereof.
Finally, the Restated Registration Rights Agreement sets forth
certain agreements between the Issuer and Air Canada relating to the exercise
by Air Canada of the two demand registration rights allocated to Air Canada
under the Amended Stockholders' Agreement, which will be effective upon the
closing of the Offering.
PROPOSED WARRANT AGREEMENT
Air Partners is negotiating with the Issuer regarding a possible
agreement for the sale by Air Partners to the Issuer, at Air Partners'
election for the one-year period commencing August 15, 1996, of up to $50
million in intrinsic value (then-current Class B Common Stock price minus
exercise price) of Air Partners' Class B Warrants. The purchase price would
be payable in cash. The Board of Directors has authorized the Issuer to
effect a public issuance of up to $50 million of Class B Common Stock to fund
any such transaction. Upon execution of any such agreement, it is expected
that the Issuer would reclassify $50 million from common equity to redeemable
warrants.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
Exhibit 4.1 Subscription and Stockholders' Agreement, dated as of April 27,
1993, among Air Partners, Air Canada and the Issuer, previously
filed.
Exhibit 4.2 Warrant Agreement, dated as of April 27, 1993, by and between
the Issuer and the Warrant Agent as defined therein, previously
filed.
Exhibit 4.3 Registration Rights Agreement dated as of April 27, 1993, among
Air Partners, Air Canada and the Issuer, previously filed.
Exhibit 4.4 Form of Lock Up Agreement between Air Partners and Goldman Sachs
International, previously filed.
Exhibit 4.5 Form of Lock Up Agreement between each Partner of Air Partners
and the Issuer, previously filed.
Exhibit 4.6 Form of Assignment of Registration Rights by Air Partners
in favor of each Partner of Air Partners, previously filed.
Exhibit 4.7 Amendment to Subscription and Stockholders' Agreement, dated as
of April 19, 1996, among Air Partners, Air Canada and the
Issuer, filed herewith.
Exhibit 4.8 Amended and Restated Registration Rights Agreement, dated as of
April 19, 1996 among the Issuer, Air Partners, and Air Canada,
filed herewith.
Exhibit 24.1 Power of Attorney dated August 7, 1995 by Alfredo Brener,
previously filed.
Exhibit 99.1 Agreement pursuant to Rule 13d-1(f)(1)(iii), filed herewith.
Exhibit 99.2 Amended and Restated Limited Partnership Agreement of Air
Partners, L. P., together with the first amendment thereto,
previously filed.
After reasonable inquiry and to the best of our knowledge and belief,
we certify that the information set forth in this statement is true, complete
and correct.
Dated: April 26, 1996
AIR PARTNERS, L.P.
By: 1992 AIR GP,
General Partner
By: 1992 AIR, INC.,
General Partner
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
1992 AIR GP
By: 1992 AIR, INC.,
General Partner
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
AIR II GENERAL, INC.
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
1992 AIR, INC.
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
/s/James J. O'Brien
James J. O'Brien,
Attorney-in-Fact for each of:
DAVID BONDERMAN (1)
ALFREDO BRENER (2)
BONDERMAN FAMILY LIMITED PARTNERSHIP
By: David Bonderman, general partner
By:/s/James J. O'Brien,
Attorney-in-Fact for DAVID BONDERMAN(1)
BONDO AIR LIMITED PARTNERSHIP
By: 1992 AIR, INC.,
General Partner
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
(1) A Power of Attorney authorizing James J. O'Brien to act on behalf of
David Bonderman was previously filed with the Commission.
(2) A Power of Attorney authorizing James J. O'Brien to act on behalf of
Alfredo Brener was previously filed with the Commission.
EXHIBIT 4.7
_________________________________________________
AMENDMENT TO
SUBSCRIPTION AND STOCKHOLDERS AGREEMENT
among
AIR PARTNERS, L.P.,
AIR CANADA
and
CONTINENTAL AIRLINES, INC.
Dated as of April 19, 1996
_________________________________________________
AMENDMENT TO SUBSCRIPTION AND STOCKHOLDERS AGREEMENT
AGREEMENT (this "Agreement"), dated as of April 19, 1996, among
AIR PARTNERS, L.P., a Texas limited partnership ("Air Partners"), AIR CANADA,
a Canadian corporation ("Air Canada") and CONTINENTAL AIRLINES, INC., a
Delaware corporation ("Continental"). (Air Partners and Air Canada are
sometimes referred to herein individually as a "Party" and jointly as the
"Parties".)
W I T N E S S E T H:
WHEREAS, Air Partners, Air Canada and Continental entered into a
Subscription and Stockholders Agreement, dated as of April 27, 1993 (the
"Stockholders Agreement"), in connection with the investments by each of Air
Partners and Air Canada in Continental as part of the reorganization of
Continental in 1993 pursuant to Chapter 11, Title 11 of the United States
Bankruptcy Code;
WHEREAS, the parties desire to enter into this Agreement to amend
certain provisions of the Stockholders Agreement and to enter into new
agreements relating to the ownership by each of Air Partners and Air Canada of
shares of Continental common stock;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, the parties agree as follows:
1. Section 1.01 of the Stockholders Agreement is hereby amended as
follows:
(a) The following definitions are deleted:
"Adjusted Securities" "Independent Director"
"Adjustment Amount" "Investment Banking Firm"
"Aggregate Previously Paid "Lock-up Termination Date"
Class A Fee Amount" "Market Price"
"Consent Fee Amount" "Notice Date"
"Blackout Period" "Notice of Acceptance"
"Class A Consent Fee" "Notice of Demand"
"Class A Consent Securities" "Notice of Offer"
"Class B Consent Fee" "Option Purchase Price"
"Class B Purchase Notice" "Pledgee"
"Class B Purchase Notice Date""Reduced Fee Securities"
"Class C Common Stock" "Purchase Option"
"Consent Period" "Registration Rights
Agreement"
"Converted B Stock" "Relevant Date"
"Covered Securities" "Restated Certificate"
"Creditors Committee" "Rule 144 Market Price"
"Creditors Designees" "Rule 144 Notice"
"Exercisable Class A Warrants""Rule 144 Notice Date"
"Exercise Date" "Rule 144 Notice of
Acceptance"
"Exercise Notice" "Rule 144 Sale"
"Foreign Ownership "Special Option Notice"
Restrictions"
"Standstill Termination Date"
(b) The following definitions are inserted:
"Air Canada Shares" shall have the meaning specified in Section
10(a) hereto.
"Amendment" means the Amendment to Subscription and Shareholders
Agreement among Air Partners, Air Canada and Continental, dated as of April
19, 1996.
"Closing" shall have the meaning set forth in Section 13 hereof.
"Code" means the Internal Revenue Code of 1986, as amended;
"Converted B Stock" means the shares of Class B Common Stock
received upon conversion of a like number of Shares of Class A Common Stock in
accordance with Section 2(e)(viii) of Article Fourth of the Restated
Certificate as in effect on the date hereof.
"Demanding Party" shall have the meaning set forth in Section 5
hereof.
"Foreign Ownership Restrictions" means applicable statutory,
regulatory and interpretive restrictions regarding foreign ownership or
control of United States air carriers.
"Initial Registration Rights Agreement" means the Registration
Rights Agreement, dated as of April 27, 1993, among Continental, Air Partners
and Air Canada.
"Overallotment Option" shall have the meaning specified in Section
10(a) hereof.
"Partner Shares" shall have the meaning specified in Section 10(a)
hereof.
"Proxy Statement" shall have the meaning specified in Section
11(b) hereof.
"Record Date" means the date fixed by the Board for the
determination of the stockholders entitled to vote at the Stockholders
Meeting.
"Registration Rights Agreement" means the Amended and Restated
Registration Rights Agreement, dated the date hereof, among Air Partners, Air
Canada and Continental, as it may be amended, modified or supplemented from
time to time.
"Restated Certificate" means the Restated Certificate of
Incorporation of Continental, as it may be amended, modified or supplemented
from time to time in accordance with its terms (and references to Articles or
Sections thereof shall be construed so as to take into account any re-
numbering thereof in any such amendment).
"Secondary Registration" shall have the meaning specified in
Section 10(a) hereof.
"Shares" shall have the meaning specified in Section 10(a) hereof.
"Special Notice" shall have the meaning set forth in Section 5
hereof.
"Stockholders Meeting" shall have the meaning set forth in
Section 11(b) hereof.
"Transfer" means any sale, transfer, assignment, conveyance,
pledge or other disposition.
"Treasury Regulation Section 1.382" means the final and temporary
income tax regulations promulgated under Section 382 of the Code and any
successor temporary or final regulation or regulations. Each reference to any
subsection of such regulations includes references to any successor to such
subsection.
"Underwritten Offering" shall have the meaning specified in
Section 10(a) hereof.
2. Sections 4.01, 4.02, 4.04, 4.05, 4.06, 4.07, 4.08, 5.01, 5.02,
7.01, 10.01, 10.09, 10.10 and 10.14(b) of the Stockholders Agreement are
hereby deleted in their entirety
3. Section 4.03 of the Stockholders Agreement is hereby amended to
read in its entirety as follows:
"SECTION 4.03 Class D Common Stock. (a) In the event that Air
Partners, directly or indirectly, wishes to transfer (other than to a
100% Party Subsidiary of, or Successor to, Air Partners) all or any
portion of the Class D Common Stock beneficially owned, directly or
indirectly, by it, Air Partners shall give twenty (20) days prior
notice of such transfer to Continental. Upon such transfer, each share
of Class D Common Stock so transferred shall convert automatically,
without any action on the part of the registered holder thereof, into
one share of Class A Common Stock. Upon notice of such transfer,
Continental shall, pursuant to and in accordance with Article Fourth,
Section 2(e) of the Restated Certificate, deliver to the registered
holder of such shares, without expense (other than applicable transfer
taxes, if any), one or more new Class A Common Stock certificates
representing the shares of Class D Common Stock so transferred in the
name of such holder or such holder s nominee.
(b) Air Partners may, pursuant to and in accordance with the
terms of this Agreement and Article Fourth, Section 2(e) of the
Restated Certificate, (i) convert all, but not less than all, of the
Class A Common Stock beneficially owned, directly or indirectly, by it
into an equal number of shares of Class D Common Stock, or (ii) convert
all, but not less than all, of the Class D Common Stock beneficially
owned, directly or indirectly, by it into shares of Class A Common
Stock, provided that each share of Class A Common Stock which shall
become beneficially owned, directly or indirectly, by Air Partners at
any time that any shares of Class D Common Stock shall be outstanding
shall convert immediately and without any action on the part of the
registered holder thereof into one (1) share of Class D Common Stock."
4. Notwithstanding the provisions of Section 6.02(a) and the first
sentence of Section 6.04 of the Stockholders Agreement, the restriction
contained in the first paragraph of the legend required pursuant to Section
6.02 of the Stockholders Agreement has ceased and terminated with respect to
all Equity Securities.
5. Section 6.03 of the Stockholders Agreement is hereby amended to
read in its entirety as follows:
"SECTION 6.03 Registration Rights Agreement. Each of
Continental, Air Canada and Air Partners has entered into the
Registration Rights Agreement. Each of the parties hereto agrees that
rights expressly granted to the Parties as such pursuant to such
agreement shall be allocated between Air Partners and Air Canada as
follows (capitalized terms used and not defined in this SECTION 6.03(a)
shall have the meanings specified in the Registration Rights
Agreement):
(a) Notwithstanding anything in the Registration Rights Agreement to
the contrary, Air Partners shall be entitled to deliver to Continental
a maximum of four, and Air Canada shall be entitled to deliver to
Continental a maximum of two, Notices of Demand that the Parties may
deliver pursuant to the Registration Rights Agreement, provided, that
(i) Air Canada may deliver a Notice of Demand prior to December 16,
1995, but may not enter into an underwriting agreement or other
agreement to sell any shares of Class B Common Stock in connection with
the registration requested thereby prior to December 16, 1996, (ii) Air
Partners may not deliver a Notice of Demand prior to January 16, 1997
and (iii) prior to sending a Notice of Demand to Continental, the Party
sending the Notice of Demand (the Demanding Party ) shall give the
other Party not less than fifteen (15) days written notice (the
Special Notice ) of its intention to make such request and, provided,
further, that Air Canada shall only be entitled to deliver to
Continental a Notice of Demand if it has complied with the obligations
set forth in Section 2.1(b)(vi)(B) of the Registration Rights
Agreement.
(b) Within seven (7) days of receipt of a Special Notice from the
Demanding Party, the other Party shall notify the Demanding Party
whether it elects to participate in any registration to be effected
pursuant to the Notice of Demand to be delivered and the amount of
Registrable Securities directly or indirectly beneficially owned by it
that it chooses to include in such registration. Thereafter, the
Demanding Party shall, in its sole discretion, determine the content of
the Notice of Demand and any other matter relating to any registration
of securities under the Registration Rights Agreement expressly
reserved to the Parties (as such) in the Registration Rights Agreement
(including, without limitation, determination of the method of
disposition to be used pursuant to Section 2.1(a) thereof, the form of,
and certain information to be contained in, the registration statement
pursuant to Section 2.1(d) thereof and the selection of an underwriter
or underwriters pursuant to Section 2.1(g) thereof).
(c) Any Registrable Securities that are to be sold by either of the
Parties in a demand registration under the circumstances specified in
Section 2.1 of the Registration Rights Agreement shall be allocated
between the Parties as follows: first, all Registrable Securities
requested to be included in such registration by the Demanding Party;
and second, to the extent permitted by the underwriter or underwriters
of such Registrable Securities pursuant to Section 2.1(h) of the
Registration Rights Agreement, such Registrable Securities requested to
be included in such registration by the other Party, as specified in
writing by such Party.
(d) Any Registrable Securities that are to be sold in an incidental
registration under the circumstances specified in Section 2.2 of the
Registration Rights Agreement shall be allocated between the Parties as
follows: first, all Registrable Securities requested to be included in
such registration by Air Partners as specified in writing by Air
Partners; and second, to the extent permitted by the underwriter or
underwriters of such Registrable Securities pursuant to Section 2.1(h)
of the Registration Rights Agreement, such Registrable Securities
requested to be included in such registration by Air Canada as
specified in writing by Air Canada."
6. The parenthetical in the first sentence of Section 8.01 of the
Stockholders Agreement is hereby amended to read as follows: "(by any means
whatsoever, including, without limitation, by means of merger, consolidation,
tender, purchase, exchange, Warrant exercise, conversion or otherwise)."
7. Section 9.02 of the Stockholders Agreement is hereby amended by
deleting clauses (a) and (b) contained therein, by relettering clauses (c),(d)
and (e) to (b), (c) and (d), respectively, by inserting as a new clause (a):
"(a) the execution by Air Canada of the amendment required under Section 11(e)
of the Amendment," and by adding the following language following the end of
the last sentence of such Section:
"; provided, however, that (x) the agreement of Air Canada set
forth in Section 11(c) of the Amendment shall survive any such
termination and (y) the agreements of Air Canada and Air
Partners set forth in Section 11(d) and Section 12,
respectively, of the Amendment shall survive any such
termination to the extent such termination occurs prior to
December 16, 1996."
8. Section 10.02 of the Stockholders Agreement is amended by adding the
phrase ", SECTION 6.03" to clause (b) immediately following the phrase "the
provisions of ARTICLE VIII."
9. Section 10.12 shall be amended by adding an "(a)" before Except ,
by deleting the clause "specifically provided herein" and inserting the phrase
set forth in paragraph (b) of this Section 10.12 , and by adding a new
paragraph which reads as follows:
"(b) Without limiting the scope of the exception set forth in
paragraph (a) of this Section 10.12, the parties hereto acknowledge that
each of the partners of Air Partners is a third party beneficiary of the
covenants of Continental set forth in Section 10 of the Amendment with
respect to such partner s proportionate interest in the Partner Shares."
10. (a) Notwithstanding anything herein or in the Initial Registration
Rights Agreement to the contrary, Continental hereby agrees that it shall
promptly register under the Securities Act, in the manner described in this
Section 10 (the "Secondary Registration") up to 2,000,000 shares of Class B
Common Stock beneficially owned by Air Canada (the "Air Canada Shares") and up
to an aggregate of 2,742,733 shares of Class B Common Stock beneficially owned
by the partners of Air Partners (the "Partner Shares", and together with the
Air Canada Shares, the Shares ) and shall engage Merrill Lynch & Co. as lead
underwriter to conduct an underwritten offering of the Shares (on a firm
commitment basis) (the "Underwritten Offering"). In connection therewith,
Continental shall use its reasonable best efforts to include as part of such
Underwritten Offering an overallotment option in favor of the underwriter or
underwriters thereof of up to 200,000 additional shares of Class B Common
Stock (the "Overallotment Option") to be satisfied, upon its exercise, out of
Class B Common Stock beneficially owned by Air Canada.
(b) Each of Air Canada and Air Partners (on behalf, and upon the
instructions, of each partner of Air Partners) shall submit to Continental, no
later than April 22, 1996, the number of Air Canada Shares and Partner Shares,
respectively, that are to be included in the Secondary Registration and
Underwritten Offering.
(c) In connection with the Secondary Registration:
(i) Continental shall follow the registration procedures set
forth in Section 2.5 of the Initial Registration Rights Agreement, except
that Continental shall use its best efforts to ensure the preparation and
initial filing of the requisite registration statement with the SEC shall
be completed no later than April 22, 1996.
(ii) the respective rights and obligations of the parties
hereto with respect to the Secondary Registration and the subsequent
distribution of the Shares by the underwriter or underwriters, as the
case may be, shall be governed by Sections 2.3 though 2.8 of the Initial
Registration Rights Agreement as if the Secondary Registration was being
effected pursuant to a demand made under Section 2.1 thereof;
(iii) Continental will pay all Registration Expenses (as
defined in the Initial Registration Rights Agreement) incurred in
connection with the Secondary Registration and Underwritten Offering,
except as otherwise provided in Section 2.3 of the Initial Registration
Rights Agreement; and
(iv) in the event the managing underwriter or underwriters of
the Underwritten Offering shall inform Continental and each of Air
Partners and Air Canada of its belief that the total number of Shares
requested to be included in the Secondary Registration exceeds the number
that can be sold in (or during the time of) such Underwritten Offering
within a price range acceptable to such Parties, then Continental will
include in such Secondary Registration such number of Shares that can be
sold in (or during the time of) such offering in the following order of
priority: first, up to 4,000,000 Shares allocated between Partner Shares
and Air Canada Shares on a pari passu basis; and second, the remaining
742,733 Partner Shares requested to be included in such Secondary
Registration by the partners of Air Partners.
(d) In no event shall the Secondary Registration effected by
Continental pursuant to this Section 10 be deemed to be a Requested
Registration, as defined in, and for the purposes of, the Initial Registration
Rights Agreement.
11. Agreements of Air Canada.
(a) Immediately upon the Closing (but in no event until after the
Record Date), Air Canada shall convert all shares of Class A Common Stock
beneficially owned by it into an equal number of shares of Class B Common
Stock pursuant to Section 2(e)(viii) of Article Fourth of the Restated
Certificate.
(b) Immediately upon the Closing (but in no event until after the
Record Date), Air Canada shall execute and deliver to Air Partners an
irrevocable proxy (in the form attached hereto as Exhibit A) authorizing Air
Partners to vote, in its sole discretion, all Common Stock beneficially owned,
directly or indirectly, by Air Canada as of the Record Date (the "Record
Shares") with respect to the matters specified in such proxy at the 1996
annual meeting of stockholders of Continental and any adjournment thereof (the
"Stockholders Meeting"); provided, however, that if for any reason such
irrevocable proxy is deemed to be unenforceable, or Air Partners is in any
manner precluded from exercising the voting power purported to be conveyed
therein, Air Canada hereby irrevocably agrees that it will attend, or cause a
duly authorized representative to attend, the Stockholders Meeting and vote,
or cause such duly authorized representative to vote, all Record Shares in
favor of the proposals set forth in the proxy statement filed by Continental
with the Securities and Exchange Commission in connection with the
Stockholders Meeting (the "Proxy Statement"), which proposals relate to (i)
the amendment of the Restated Certificate of Incorporation of Continental,
(ii) the adoption and approval of the 1996 Executive Bonus Program, (iii) the
adoption and approval of the Second Amendment to the 1994 Equity Incentive
Plan, (iv) the election of the nominees for director set forth in the Proxy
Statement and (v) ratification of Ernst & Young as Continental s independent
auditors.
(c) Air Canada hereby irrevocably waives its rights to exchange
shares of Additional Class B Common Stock, in whole or in part, for an equal
number of shares of Class A Common Stock pursuant to Section 2.01(b) of the
Stockholders Agreement and Section 2(f) of Article Fourth of the Restated
Certificate.
(d) Air Canada hereby confirms, covenants and agrees that it will
not, prior to December 16, 1996, directly or indirectly (i) Transfer or
acquire, or attempt to Transfer or acquire, in any manner legal or beneficial
ownership of, or enter into an agreement (including any instrument or
arrangement treated as an exercised option under Treasury Regulation 1.382-4),
for the Transfer or acquisition of Common Stock, or any other Continental
securities constituting stock under Section 382(k)(6) of the Code or (ii)
Transfer or acquire, or attempt to Transfer or acquire, in any manner legal or
beneficial ownership of, or enter into an agreement (including any instrument
or arrangement treated as an exercised option under Treasury Regulation
Section 1.382-4) for the Transfer or acquisition of Air Canada common stock,
or any other Air Canada securities characterized as "stock" under Section
382(k)(6) of the Code. In connection with the foregoing covenant, except as
expressly provided below, Air Canada shall not, prior to December 16, 1996,
enter into any agreement relating to the Transfer or acquisition of any
Continental or Air Canada securities (including without limitation Common
Stock or common or preferred stock or debt securities of Air Canada and
including any transaction that would constitute an option under Treasury
Regulation 1.382-4 with respect to such stock, securities or indebtedness) or
Transfer or acquire such securities without first notifying Continental of
such contemplated transaction or agreement and (x) counsel satisfactory to
Continental having opined that such agreement, Transfer or acquisition will
not have the effect under Section 382 of the Code of increasing the percentage
ownership by any Air Canada shareholders or shareholders of Common Stock or
other securities constituting "stock" (within the meaning of Section 382(k)(6)
of the Code) or (y) Continental having otherwise consented to such agreement
or transaction, in which case Air Canada shall be deemed to be in compliance
with such covenant. Continental shall, upon prior written notice from Air
Canada, be required to consent to the following transactions unless such
transactions shall have been, in the opinion of counsel to Continental, the
subject of a change in law since the date hereof (by statute, regulation,
ruling or otherwise):
the sale or other Transfer of the Air Canada Shares and, in
addition, the sale of up to an additional 200,000 shares of Class B
Common Stock pursuant to the Overallotment Option;
the conversion of all shares of Class A Common Stock beneficially
owned by it into an equal number of shares of Class B Common Stock
as required under Section 11(a) hereof;
the sale of all of the shares of the Preferred Stock of Continental
previously issued to Air Canada and held by it on the date hereof;
the issuance by Air Canada of debt securities or other indebtedness
of a term (including all optional extensions) of less than twenty
years so long as the amount of interest payable thereunder is not
contingent in whole or part on other than prevailing interest rates
(such as LIBOR), the indebtedness can be satisfied solely by the
payment of cash by Air Canada, such indebtedness is not convertible
or exchangeable into any securities constituting stock (within the
meaning of Section 382(k)(6) of the Code) of Air Canada or any
Affiliate of Air Canada or any securities constituting "stock"
(within the meaning of Section 382(k)(6) of the Code) of Continental
or any Affiliate thereof and such indebtedness is not in whole or
part secured by Common Stock;
subject to compliance with applicable law, the entering into a put
option with respect to Common Stock owned by Air Canada permitting
Air Canada to put such stock at a price of 90 percent or less of the
current market price of such stock at the time of entering into the
put, provided that Air Canada shall not have or will not prior to
December 16, 1996 enter into any other option (including a call
option) or other agreement contemplating the sale of the shares
subject to such put;
the causing of the registration of Common Stock (in addition to the
Air Canada Shares and the shares of Class B Common Stock subject to
the Overallotment Option) and the activities associated with the
underwriting thereof (including road shows), provided that Air
Canada shall not (except with respect to the Air Canada Shares and
the shares of Class B Common Stock subject to the Overallotment
Option) enter into an underwriting agreement or other agreement
actually to sell any such shares of Class B Common Stock prior to
December 16, 1996; or
the entering into a stock loan transaction pursuant to an agreement
described in Section 1058 of the Code, provided that the shares
loaned pursuant to such agreement, together with the shares
beneficially owned, directly or indirectly, by the borrower thereof,
do not exceed 4.9% of the issued and outstanding common stock of
Continental, including the Common Stock and other securities
constituting "stock" (within the meaning of 382(k)(6) of the Code).
Any purported Transfer of Common Stock in violation of the preceding
paragraph shall be null and void and shall not operate to transfer title to,
or any interest in, the Common Stock purportedly Transferred to the purported
transferee. In connection therewith, Air Canada shall take, upon the request
of Continental, all actions necessary to permit the placement of an
appropriate restrictive legend on the certificate(s) that represent the shares
of Common Stock beneficially owned, directly or indirectly, by Air Canada.
Air Canada further represents that as of the date hereof it is not
a party to (nor are any of the shares of any class of Common Stock registered
in the name of, beneficially owned or controlled by Air Canada subject to) any
option, warrant or other right to acquire such Common Stock by any other
Person or entity other than as provided in the Stockholders Agreement.
(e) Immediately following the earlier of (i) the effectiveness of
a second Requested Registration (as defined in the Registration Rights
Agreement) by Air Canada in accordance with Section 2.1(f) of the Registration
Rights Agreement and (ii) the sale by Air Canada of all Common Stock held by
it, Air Canada shall take all action necessary to amend the Registration
Rights Agreement so as to delete all of its rights thereunder and, until such
time as such amendment is effective, Air Canada shall be deemed to have
irrevocably waived all of its rights the Registration Rights Agreement.
(f) At any time following the Closing, upon the request of
Continental, Air Canada shall take all action necessary to cause each
individual designated or nominated by it to serve on the Board of Directors of
Continental to resign.
12. Agreement of Air Partners. Air Partners hereby confirms,
covenants and agrees that it will not, prior to December 16, 1996, directly or
indirectly, Transfer or acquire, or attempt to Transfer or acquire, in any
manner legal or beneficial ownership of, or enter into an agreement (including
any instrument or arrangement treated as an exercised option under Treasury
Regulation 1.382-4), for the Transfer or acquisition of Common Stock, or any
other Continental securities constituting stock under Section 382(k)(6) of
the Code. In connection with the foregoing covenant, except as expressly
provided below, Air Partners shall not, prior to December 16, 1996, enter into
any agreement relating to the Transfer or acquisition of any Continental
securities (including without limitation Common Stock and including any
transaction that would constitute an option under Treasury Regulation 1.382-4
with respect to such stock) or Transfer or acquire such securities without
first notifying Continental of such contemplated transaction or agreement and
(x) counsel satisfactory to Continental having opined that such agreement,
Transfer or acquisition will not have the effect under Section 382 of the Code
of increasing the percentage ownership of any shareholders of Common Stock or
other securities constituting stock (within the meaning of Section 382(k)(6)
of the Code) or (y) Continental having otherwise consented to such agreement
or transaction, in which case Air Partners shall be deemed to be in compliance
with such covenant. Continental shall, upon prior written Notice from Air
Partners, be required to consent to the following transactions unless such
transactions shall have been, in the opinion of counsel to Continental, the
subject of a change in law since the date hereof (by statute, regulation,
ruling or otherwise): (i) the conversion of any or all shares of Class A
Common Stock beneficially owned by it into an equal number of shares of Class
B common stock if permitted at any time under the Restated Certificate, (ii)
the Transfer of Class A Warrants or Class B Warrants to Continental or the
entering into of an agreement relating to such Transfer, (iii) the exercise of
Class A Warrants or Class B Warrants beneficially owned by Air Partners or
(iv) the exercise of preemptive rights in accordance with Article Seventh of
the Restated Certificate.
Any purported Transfer of Common Stock in violation of the preceding
paragraph shall be null and void and shall not operate to transfer title to,
or any interest in, the Common Stock purportedly Transferred to the purported
transferee. In connection therewith, Air Partners shall take, upon the
request of Continental, all actions necessary to permit the placement of an
appropriate restrictive legend on the certificate(s) that represent the shares
of Common Stock beneficially owned, directly or indirectly, by Air Partners.
Air Partners further represents that as of the date hereof it is not
a party to (nor are any of the shares of any class of Common Stock registered
in the name of, beneficially owned or controlled by Air Partners subject to)
any option, warrant or other right to acquire such Common Stock by any other
Person or entity other than as provided in the Stockholders Agreement.
13. Except for the agreement of Continental set forth in (and the
obligations of the Parties contemplated in) Section 10 hereof, and the
covenants of Air Canada and Air Partners set forth in Section 11(d) and
Section 12, respectively, which shall be effective on and as of the date
hereof, the obligations of the Parties hereunder, and the effectiveness of the
amendments set forth herein, are subject to the closing of the Underwritten
Offering (the "Closing") and shall become effective concurrently therewith;
provided, however, that the covenants of Air Canada and Air Partners set forth
in Section 11(d) and Section 12, respectively, shall (i) not restrict the sale
of the Air Canada Shares (including the shares subject to the Overallotment
Option) and the Partner Shares, respectively, pursuant to the Underwritten
Offering and (ii) terminate if the Closing has not occurred on or prior to May
31, 1996 and shall subsequently become effective only upon the occurrence of
the Closing.
14. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York.
15. The parties hereto agree that the obligations imposed on them in
this Agreement are special, unique and of an extraordinary character, and that
in the event of a breach by any such party, damages would not be an adequate
remedy and each party hereto shall, to the extent permitted by law, be
entitled to specific performance and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled at law or in equity;
and each of the parties hereto, to the extent permitted by law, hereby waives
any requirement for the securing or posting of any bond in connection with the
obtaining of any such injunctive or other equitable relief.
16. Except as modified hereby, the Stockholders Agreement shall remain
in full force and effect.
17. This Agreement may be executed simultaneously in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly authorized
as of the date first above written.
AIR PARTNERS, L.P.
By: 1992 Air GP, as General Partner
By: 1992 Air, Inc., as General Partner
By:_______________________________________
Name: _____________________________________
Title: ____________________________________
AIR CANADA
By:_______________________________________
Name: _____________________________________
Title: ____________________________________
CONTINENTAL AIRLINES, INC.
By: ______________________________________
Name: ____________________________________
Title: ____________________________________
EXHIBIT 4.8
_________________________________________________
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
among
AIR PARTNERS, L.P.,
AIR CANADA
and
CONTINENTAL AIRLINES, INC.
Dated as of April 19, 1996
_________________________________________________
TABLE OF CONTENTS
Page
1. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
2. Registration under the Securities Act. . . . . . . . . . . . . . . . .4
2.1 Registration on Request. . . . . . . . . . . . . . . . . . . . . . . .4
2.2 Incidental Registration. . . . . . . . . . . . . . . . . . . . . . . .7
2.3 Withdrawal from Registration . . . . . . . . . . . . . . . . . . . . .8
2.4 Holdback Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.5 Registration Procedures. . . . . . . . . . . . . . . . . . . . . . . .8
2.6 Underwritten Offerings. . . . . . . . . . . . . . . . . . . . . . . .12
2.7 Preparation; Reasonable Investigation. . . . . . . . . . . . . . . . 13
2.8 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3. Rule 144. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
4. Amendments and Waivers. . . . . . . . . . . . . . . . . . . . . . . .17
5. Entire Agreement; Other Agreements. . . . . . . . . . . . . . . . . .17
6. No Third Party Beneficiary. . . . . . . . . . . . . . . . . . . . . .17
7. Invalid Provisions. . . . . . . . . . . . . . . . . . . . . . . . . .18
8. Nominees for Beneficial Owners. . . . . . . . . . . . . . . . . . . .18
9. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
10. Assignment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
11. Descriptive Headings. . . . . . . . . . . . . . . . . . . . . . . . .20
12. Specific Performance. . . . . . . . . . . . . . . . . . . . . . . . .20
13. GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
14. Majority of Shares. . . . . . . . . . . . . . . . . . . . . . . . . .20
15. Registration Rights to Others. . . . . . . . . . . . . . . . . . . . 20
16. Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
17. Provision of Information. . . . . . . . . . . . . . . . . . . . . . .20
18. Effectiveness. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT, dated as of
April 19, 1996 among CONTINENTAL AIRLINES, INC. a Delaware corporation
("Continental"), AIR PARTNERS, L.P., a Texas limited partnership ("Air
Partners"), and AIR CANADA ("Air Canada"), a Canadian corporation. (Air
Partners and Air Canada are sometimes referred to herein individually as a
Party and jointly as the "Parties".)
W I T N E S S E T H:
WHEREAS, Continental, Air Partners, and Air Canada entered into,
among other things, a Registration Rights Agreement dated as of April 27, 1993
(the "Registration Rights Agreement") in connection with the investments by
Air Partners and Air Canada in Continental as part of the reorganization of
Continental in 1993 pursuant to Chapter 11, Title 11 of the United States
Bankruptcy Code;
WHEREAS, the parties have agreed, among other things, to amend and
restate in its entirety, the Registration Rights Agreement;
NOW THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, the parties hereby agree as
follows:
1. Definitions. Capitalized terms used but not defined herein
shall have the meanings ascribed to such terms in the Stockholders Agreement
(as defined herein). In addition, the following terms, as used herein, have
the following meanings (all terms defined herein in the singular to have the
correlative meanings when used in the plural and vice versa):
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control
with, such Person; control when used with respect to any Person means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. For purposes of
this Agreement, each limited and general partner of Air Partners shall be
deemed to be an Affiliate of Air Partners.
"Agreement" means this Amended and Restated Registration Rights
Agreement, as the same shall be amended, modified or supplemented from time to
time.
"Board" means the Board of Directors of Continental.
"Continental" has the meaning ascribed to it in the preamble.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Exclusive Sales Period" has the meaning ascribed to it in Section
2.1(b).
"Incidental Registration" means any registration of Registrable
Securities under the Securities Act effected in accordance with Section 2.2.
"Incidental Registration Notice" has the meaning ascribed to it in
Section 2.2(a).
"Indemnified Party" has the meaning ascribed to it in Section
2.8(a).
"Independent Director" means each director of Continental who is not
(and has not been within the one-year period immediately preceding the date of
such director s initial election to the Board) an officer, director, employee
or partner of Air Partners or any Person that controls or is controlled by Air
Partners (other than Continental), is not (and has not been within the one-
year period immediately preceding the date of such director s initial election
to the Board) a designee or nominee of Air Partners to the Board and is not a
member of the immediate family of any of the foregoing Persons.
"Investment Agreement" means the Investment Agreement dated as of
November 9, 1992, among Air Canada, Air Partners, Continental and Continental
Airlines Holdings, Inc., as may be amended from time to time in accordance
with its terms.
"Notice of Demand" means a request by either Party pursuant to, and
in accordance with, Section 6.03 of the Stockholders Agreement that
Continental effect the registration under the Securities Act of all or part of
the Registrable Securities held by the Parties (or any one of them) pursuant
to Section 2.1(a), such request to specify (i) the type and amount of
Registrable Securities proposed to be registered, (ii) the intended method or
methods and plan of disposition thereof and (iii) whether or not such
requested registration is to be an underwritten offering.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Registrable Securities" means (a) any shares of Class A Common
Stock or Class B Common Stock (including Additional Class B Common Stock)
issued on the Closing Date, (b) any Warrant, (c) any shares of Class A Common
Stock or Class B Common Stock issuable upon the exercise of the Warrants, (d)
any securities issued or issuable with respect to any such Class A Common
Stock, Class B Common Stock or Warrants by way of stock dividend or stock
split or in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization or otherwise, (e) any shares of Class A
Common Stock issuable upon exchange or conversion of shares of Class D Common
Stock, (f) any shares of Class B Common Stock purchased pursuant to Article
Seventh of the Restated Certificate and (g) any shares of Converted B Stock.
As to any particular Registrable Securities, once issued such securities shall
cease to be Registrable Securities when (i) a registration statement with
respect to the sale of such securities shall have become effective under the
Securities Act and such securities shall have been disposed of in accordance
with the plan of distribution set forth in such registration statement, (ii)
such securities shall have been distributed in accordance with Rule 144 (or
any successor provision) under the Securities Act or (iii) such securities
shall have been otherwise transferred to a third party, new certificates
therefor not bearing a legend restricting further transfer shall have been
delivered in exchange therefor by Continental and subsequent disposition of
such shares shall not require registration or qualification under the
Securities Act or any similar state law then in force.
"Registration Expenses" means all expenses incident to Continental's
performance of or compliance with Section 2, including, without limitation,
(a) all registration, filing, securities exchange listing and National
Association of Securities Dealers fees, (b) all registration, filing,
qualification and other fees and expenses of complying with securities or blue
sky laws, (c) all word processing, duplicating, printing, messenger and
delivery expenses, (d) the fees and disbursements of counsel for Continental
and of its independent public accountants, including, without limitation, the
expenses of any Special Audits or cold comfort letters required by or
incident to such performance and compliance, (e) the reasonable fees and
disbursements incurred by the holders of the Registrable Securities being
registered (including, without limitation, the reasonable fees and
disbursements of any one counsel and any one accounting firm selected by the
Party issuing the Notice of Demand or the Requisite Holders, as the case may
be), (f) reasonable premiums and other reasonable costs of policies of
insurance against liabilities arising out of the public offering of the
Registrable Securities being registered, (g) any fees and disbursements of
underwriters customarily paid by issuers or sellers of securities, including,
without limitation, reasonable fees and disbursements of counsel for the
underwriter or underwriters or selling holders in connection with blue sky
qualifications of the Registrable Securities and determination of their
eligibility for investment under the laws of such jurisdictions, but excluding
underwriting discounts and commissions and transfer taxes, if any, relating to
Registrable Securities and (h) fees and expenses of other Persons retained or
employed by Continental.
"Registration Rights Agreement" has the meaning ascribed to it in
the preamble.
"Requested Registration" means any requested registration of
Registrable Securities under the Securities Act effected in accordance with
Section 2.1.
"Requesting Holders" means, with respect to any Requested
Registration or Incidental Registration, the holders of Registrable Securities
requesting to have Registrable Securities included in such registration in
accordance with this Agreement.
"Required Lockup" has the meaning ascribed to it in Section 2.1(b).
"Requisite Holders" means, with respect to any registration of
Registrable Securities by Continental pursuant to Section 2.2, any holder or
holders of a majority of the Registrable Securities to be so registered.
"Rule 144" means Rule 144 promulgated by the SEC under the
Securities Act, and any successor provision thereto.
"SEC" means the United States Securities and Exchange Commission, or
any successor governmental agency or authority thereto.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"Special Audit" means an audit Continental is required to undertake
in connection with a Requested Registration, solely as a result of the timing
of the Notice of Demand to which such registration relates, in order to
restate or prepare pro forma financial statements in connection with an
acquisition or disposition of the type and nature required to be disclosed
pursuant to Item 2 of Form 8-K under the Exchange Act.
"Stockholders Agreement" means the Subscription and Stockholders
Agreement, dated April 27, 1993, among Continental, Air Partners and Air
Canada, as amended by written agreement of the parties thereto, dated the date
hereof.
2. Registration under the Securities Act.
2.1 (a) Registration on Request. Except as provided in
Section 2.1(b), upon receipt of a Notice of Demand from either Party,
Continental shall use its reasonable best efforts to effect at the earliest
practicable date the registration under the Securities Act of the Registrable
Securities that Continental has been so requested to register by such Party
pursuant to the Notice of Demand, for disposition in accordance with the
intended method or methods of disposition specified in such Notice; provided,
however, that with respect to any Requested Registration by Air Canada
pursuant to Section 6.03 of the Stockholders Agreement, Air Canada may only
dispose of Registrable Securities pursuant to a secondary underwritten
offering unless Continental agrees in writing to an alternate method of
distribution.
(b) Registration Restrictions. Notwithstanding the foregoing,
Continental shall not be obligated to take any action to effect any
registration pursuant to Section 2.1(a) (i) after Continental has effected six
(6) such registrations pursuant to such Section and in accordance with the
provisions of Section 2.1(f) (except for actions relating to a previous Notice
of Demand delivered pursuant to Section 2.1(a)); (ii) during any period (not
to exceed sixty (60) days) if the Independent Directors of Continental
determine in good faith that it would be materially detrimental to Continental
and its shareholders to file a registration statement at such time (such
determination to be evidenced by a certificate of the Chief Executive Officer
or any Senior or Executive Vice President of Continental and delivered at such
time to Continental and to the Parties); (iii) during the period commencing on
the date of delivery of an Incidental Registration Notice and ending on the
earlier of (y) the twentieth (20th) day after the effectiveness of the
registration statement to which such Incidental Registration Notice relates
and (z) the date the Board determines in good faith to abandon plans to pursue
the registration contemplated by such Incidental Registration Notice (such
determination to be evidenced by a certificate of the Chief Executive Officer
or any Senior or Executive Vice President of Continental and delivered at such
time to Continental and to the Parties); (iv) if the Party providing the
Notice of Demand does not beneficially own, directly or indirectly, at least
five percent (5%) of the aggregate voting power of the then outstanding Voting
Securities on a fully-diluted basis; (v) if a Requested Registration pursuant
to this Section 2.1 has been effected pursuant to and in accordance with this
Agreement within the previous sixty (60) days; or (vi) with respect to a
Requested Registration by Air Canada in accordance with Section 6.03 of the
Stockholders Agreement (A) during any period (not to exceed thirty (30) days)
subsequent to January 31, 1997 if, during such period, Continental intends to
issue any securities or (B) except as otherwise provided below in the second
proviso of this sentence, if, within the six-month period immediately
preceding the issuance of a Notice of Demand by Air Canada subsequent to the
Exclusive Sales Period (as defined below), Air Canada has failed to execute
any lockup required of Air Partners in connection with any issuance by
Continental of its securities (a "Required Lockup"); provided, however, that
the exceptions to Continental s obligations under Section 2.1(a) set forth in
clauses (ii) and (iv) of this Section 2.1(b) shall not apply to any such
Requested Registration by Air Canada relating to a disposition of Registrable
Securities during the period commencing on December 16, 1996 and ending on
January 31, 1997 (the "Exclusive Sales Period"); and, provided, further, that
Air Canada shall not be obligated to execute any Required Lockup (and the fact
of any such non-execution shall not be deemed a failure by Air Canada under
clause (vi)(B) of this Section 2.1(b)) if the effect of such Required Lockup
would be to prevent Air Canada from selling Registrable Securities during the
Exclusive Sales Period pursuant to a Requested Registration in accordance with
Section 6.03 of the Shareholders Agreement.
If, subsequent to the Exclusive Sales Period, Air Canada holds
Registrable Securities representing less than five percent (5%) of the
outstanding capital stock of Continental, Continental agrees to use its
reasonable best efforts to cause any underwriter or underwriters engaged by
Continental in connection with any offering of its securities to waive the
requirement (if any) that Air Canada execute a Required Lockup in connection
with such offering, it being specifically understood that Air Canada shall be
required to execute a Required Lockup if such a waiver is not obtained.
(c) Registration of Securities. Without limiting the foregoing,
when making a request for registration pursuant to Section 2.1(a), the Party
providing the Notice of Demand may seek to register different types of
Registrable Securities and/or different classes of the same type of
Registrable Securities simultaneously and Continental shall use its, and in
the case of an underwritten offering, shall cause the managing underwriter or
underwriters to use its, or their, reasonable best efforts to effect such
registration and sale in accordance with the intended method or methods of
disposition specified in the Notice of Demand.
(d) Registration Statement Form. Registrations under this Section
2.1 shall be on such appropriate registration form of the SEC (i) as shall be
selected by Continental and as shall be reasonably acceptable to the Party
providing the Notice of Demand and (ii) as shall permit the disposition of
such Registrable Securities in accordance with the intended method or methods
of disposition specified in the Notice of Demand. Continental agrees to
include in any such registration statement all information which the Party
providing the Notice of Demand shall reasonably request.
(e) Expenses. Subject to Section 2.3, Continental will pay all
Registration Expenses incurred in connection with a registration effected
(whether or not deemed effective pursuant to Section 2.1(f)) pursuant to this
Section 2.1, except that Continental shall not be so required to pay any
Registration Expenses in connection with a Requested Registration by Air
Canada in accordance with Section 6.03 of the Stockholders Agreement if a
previous Requested Registration by Air Canada was deemed to have been effected
pursuant to Section 2.1(f) hereof. In addition, Continental shall use its
best efforts consistent with past practice to ensure that the underwriters
involved in the underwritten offering of Registrable Securities pay all road
show expenses in connection therewith.
(f) Effective Registration Statement. For purposes of this
Agreement, a Requested Registration shall be deemed to have been effected
(including, without limitation for purposes of Section 2.1(b)(i)) if (and only
if) (i) a registration statement with respect thereto has become effective and
remains effective during the period provided for in Section 2.5(ii) or (ii)
such registration is deemed to have been effected pursuant this Section 2.1(f)
or Section 2.3(b). A Requested Registration pursuant to this Section 2.1
shall not be considered effected for purposes of this Section 2.1(f) (A) if,
after it has become effective, such registration is interfered with by any
stop order, injunction or other order or requirement of the SEC or other
governmental agency or court for any reason (other than a misrepresentation or
an omission by the holders of such Registrable Securities in which case such
registration shall be deemed to have been effected pursuant to this Section
2.1(f)) and such order or injunction has not been lifted; or (B) if the
conditions to closing specified in the purchase agreement or underwriting
agreement entered into in connection with such registration have not been
satisfied (unless such condition or conditions have been waived or such non-
satisfaction is due to the wrongful or bad faith act, omission or
misrepresentation by the holders of such Registrable Securities in which case
such registration shall be deemed to have been effected pursuant to this
Section 2.1(f)).
(g) Selection of Underwriters. If a Requested Registration
involves an underwritten offering, the underwriter or underwriters thereof
shall be selected by the Party providing the Notice of Demand with the
approval of Continental, such approval not to be unreasonably withheld;
provided, however, that if Air Canada is the Party providing the Notice of
Demand, the underwriter or underwriters thereof shall be Merrill Lynch & Co.
and/or Goldman, Sachs & Co. and/or any other investment bank mutually
acceptable to Continental and Air Canada.
(h) Priority in Demand Registrations. If a registration pursuant
to this Section 2.1 involves an underwritten offering of the Registrable
Securities being registered to be distributed (on a firm commitment basis) by
or through one or more underwriters and the managing underwriter or
underwriters of such underwritten offering shall inform Continental and the
Party providing the Notice of Demand by letter of its belief that the number
of securities requested to be included in such registration exceeds the number
that can be sold in (or during the time of) such offering within a price range
acceptable to such Party or Parties, then Continental will include in such
registration such number of Registrable Securities that can be sold in (or
during the time of) such offering as requested to be included in such
registration by such Party or Parties in the manner specified in Section 6.03
of the Stockholders Agreement.
2.2 Incidental Registration.
(a) Right to Include Registrable Securities. During the period
commencing on the date this Agreement becomes effective in accordance with
Section 18 hereof to and including the twelfth (12th) anniversary thereof, if
Continental at any time proposes to register any of its securities under the
Securities Act (other than (i) by a registration on Form S-4 or Form S-8 or
any successor or similar form then in effect, (ii) pursuant to a registration
right granted by Continental as part of a bona-fide financing by Continental
structured as a private placement of securities (other than common stock or
warrants to purchase common stock) to be followed, within 270 days of the
consummation thereof, by the filing of a shelf registration statement with
respect to such securities, or (iii) pursuant to Section 2.1) in a form and in
a manner that would permit registration of the Registrable Securities, whether
or not for sale for its own account, it will, as soon as practicable (but in
no event less than twenty (20) days prior to the proposed date of filing the
registration statement relating to such registration), give prompt written
notice to the Parties and such Affiliates of the Parties as the Parties may
designate in writing to Continental prior to or within five (5) days after the
date of such notice to the Parties and who then hold Registrable Securities of
its intention to do so and of such holders' rights under this Section 2.2.
Upon the written request of any such holder made within fifteen (15) days
after the receipt of any such notice to the Parties (which request shall
specify the Registrable Securities intended to be disposed of by such holder
and the intended method or methods of disposition thereof) (the "Incidental
Registration Notice"), Continental will use its reasonable best efforts to
effect the registration under the Securities Act of all Registrable Securities
which Continental has been so requested to register by the holders thereof, to
the extent requisite to permit the disposition (in accordance with the
intended method or methods thereof as aforesaid) of the Registrable Securities
so to be registered, provided that if, at any time after giving written notice
of its intention to register any securities and prior to the effective date of
the registration statement filed in connection with such registration,
Continental shall determine for any reason not to register or to delay
registration of such securities, Continental may, at its election, give
written notice of such determination to each such holder of Registrable
Securities and, thereupon, (i) in the case of a determination not to register,
shall be relieved of its obligation to register any Registrable Securities in
connection with such registration (but not from its obligation to pay any and
all expenses in connection therewith as specified in the last sentence of this
Section 2.2(a)), without prejudice, however, to the rights of the Parties to
request that such registration be effected as a registration under Section
2.1, and (ii) in the case of a determination to delay registering, shall be
permitted to delay registering any Registrable Securities, for the same period
as the delay in registering such other securities; and provided, further,
that, for purposes of this Section 2.2(a), the use by Continental of its
reasonable best efforts shall not require Continental to reduce the amount
or sale price of the securities it proposes to distribute for its own account.
No registration effected under this Section 2.2 shall be deemed to have been
effected pursuant to Section 2.1 or shall relieve Continental of its
obligation to effect any registration upon request under Section 2.1. Subject
to Section 2.3, Continental will pay all Registration Expenses incurred in
connection with each registration of Registrable Securities pursuant to this
Section 2.2.
(b) Priority in Incidental Registrations. If (i) a registration
pursuant to this Section 2.2 involves an underwritten offering of the
securities being registered, whether or not for sale for the account of
Continental, to be distributed (on a firm commitment basis) by or through one
or more underwriters of recognized standing under underwriting terms
appropriate for such a transaction and (ii) the managing underwriter of such
underwritten offering shall inform Continental and the holders of the
Registrable Securities requesting such registration by letter of its belief
that the number of securities requested to be included in such registration
exceeds the number which can be sold in (or during the time of) such offering
within a price range acceptable to Continental, then Continental will include
in such registration such number of securities which Continental is so advised
can be sold in (or during the time of) such offering as follows: first, all
securities proposed by Continental to be sold for its own account; second,
such Registrable Securities requested to be included in such registration by
either or both of the Parties as specified in Section 6.03 of the Stockholders
Agreement; third, such Registrable Securities requested to be included in such
registration by all other Requesting Holders pro rata on the basis of the
number of shares of such securities so proposed to be sold and so requested to
be included by such other holders; and fourth, all other securities of
Continental requested to be included in such registration pro rata on the
basis of the number of shares of such securities so proposed to be sold and so
requested to be included.
2.3 Withdrawal from Registration. Each Requesting Holder shall be
permitted to withdraw all or part of such holder's Registrable Securities
included in a Requested Registration or an Incidental Registration at any time
prior to the effective date of such registration; provided that (a) in the
event of a withdrawal from an Incidental Registration, any fees and
disbursements incurred by the Requesting Holders in connection with such
registration shall be paid by such Requesting Holders; and (b) in the event of
a withdrawal from a Requested Registration, such registration shall be deemed
to have been effected for purposes of Section 2.1(f) unless (i) the Parties
have paid any fees and disbursements incurred by them in connection with such
registration or (ii) such withdrawal is due to the occurrence of an adverse
change in market conditions or a materially adverse change in Continental's
business, condition (financial or otherwise) or prospects since the date of
the Notice of Demand relating to such registration.
2.4 Holdback Agreement. If a registration pursuant to this
Agreement involves an underwritten offering of the securities being
registered, each Party participating in such offering agrees to, and shall use
reasonable efforts to cause its Affiliates to, enter into a holdback agreement
with the underwriter or underwriters of such offering containing provisions of
the type customarily employed in such agreements with respect to registered
public offerings underwritten by nationally-recognized underwriting firms.
2.5 Registration Procedures. If and whenever Continental is
required to use its reasonable best efforts to effect the registration of any
Registrable Securities under the Securities Act as provided in Sections 2.1
and 2.2, Continental will as expeditiously as possible:
(i) prepare and (as soon thereafter as possible but in any event no
later than (A) 120 days from the date a request for registration is made
or (B) in the event Continental is required to undertake a Special Audit,
150 days from such date) file with the SEC the requisite registration
statement to effect such registration and thereafter use its reasonable
best efforts to cause such registration statement to become effective,
provided that as far in advance as practicable before filing such
registration statement or any amendment thereto, Continental will furnish
to the Requesting Holders copies of reasonably complete drafts of all
such documents proposed to be filed (including exhibits), and any such
holder shall have the opportunity to object to any information contained
therein and Continental will make the corrections reasonably requested by
such holder with respect to such information prior to filing any such
registration statement or amendment; provided, however, that with respect
to the first Requested Registration during the Exclusive Sales Period by
Air Canada in accordance with Section 6.03 of the Stockholders Agreement,
the time periods specified in clause (A) and clause (B) of this Section
2.5(i) shall be 30 days and 60 days, respectively;
(ii) prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement
effective for a period not to exceed nine (9) months (or such shorter
period as shall be necessary to complete the distribution of the secu-
rities covered thereby, but not before the expiration of the applicable
period referred to in Section 4(3) of the Securities Act and Rule 174
thereunder) and comply with the provisions of the Securities Act with
respect to the sale or other disposition of all securities covered by
such registration statement during such period in accordance with the
intended methods of disposition by the seller or sellers thereof set
forth in such registration statement;
(iii) furnish to each seller of Registrable Securities covered
by such registration statement such number of conformed copies of such
registration statement and of each such amendment and supplement thereto
(in each case including all exhibits and documents incorporated by
reference), such number of copies of the prospectus contained in such
registration statement (including each preliminary prospectus and any
summary prospectus) and any other prospectus filed under Rule 424
promulgated under the Securities Act relating to such holder's
Registrable Securities, in conformity with the requirements of the
Securities Act, and such other documents as such seller may reasonably
request to facilitate the disposition of its Registrable Securities;
(iv) use its reasonable best efforts to register or qualify all
Registrable Securities and other securities covered by such registration
statement under such other securities or blue sky law of such
jurisdictions each seller thereof shall reasonably (in light of each such
seller's intended plan of distribution) request, to keep such
registration or qualification in effect for so long as such registration
statement remains in effect, and take any other action which may be
reasonably necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the securities owned by such seller,
except that Continental shall not for any such purpose be required to (a)
qualify generally to do business as a foreign corporation in any
jurisdiction wherein it would not, but for the requirements of this
clause (iv), be obligated to be so qualified, (b) subject itself to
taxation in any such jurisdiction or (c) consent to general service of
process in any such jurisdiction;
(v) use its reasonable best efforts to cause all Registrable
Securities covered by such registration statement to be registered with
or approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof (or underwriter, if
any) to consummate the disposition of such Registrable Securities in
accordance with the plan of distribution set forth in such registration
statement;
(vi) furnish to each seller of Registrable Securities a signed
counterpart, addressed to such seller (and underwriter, if any) of:
(a) an opinion of counsel to Continental, dated the effective
date of such registration statement (and, if such registration
includes an underwritten public offering, dated the date of the
closing under the underwriting agreement), reasonably satisfactory
in form and substance to such seller (and underwriter), and
(b) a "comfort" letter, dated the effective date of such
registration statement (and, if such registration includes an
underwritten public offering, dated the date of the closing under
the underwriting agreement), signed by the independent public
accountants who have certified Continental's financial statements
included in such registration statement,
in each case covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and, in the case
of the accountants' letter, with respect to events subsequent to the date of
such financial statements, as are customarily covered in opinions of issuer's
counsel and in accountants' letters delivered to the underwriters in
underwritten public offerings of securities and, in the case of the
accountants' letter, such other financial matters as such sellers (or
underwriters, if any) may reasonably request;
(vii) promptly notify each seller of Registrable Securities
covered by such registration statement, at any time when a prospectus
relating thereto is required to be delivered under the Securities Act,
upon discovery that, or upon the happening of any event known to
Continental as a result of which, the prospectus included in such
registration statement, as then in effect, includes an untrue statement
of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading
in light of the circumstances under which they were made, and at the
request of any such seller as promptly as practicable prepare and furnish
to such seller a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances under
which they were made;
(viii) otherwise use its reasonable best efforts to comply with
all applicable rules and regulations of the SEC, including the Securities
Act and the Exchange Act and the rules and regulations promulgated
thereunder, and make available to its security holders, as soon as
reasonably practicable (but not more than fifteen (15) months) after the
effective date of the registration statement, an earnings statement
satisfying the provisions of Section 11(a) of the Securities Act and Rule
158 promulgated thereunder;
(ix) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by such registration
statement from and after a date not later than the effective date of such
registration statement;
(x) use its reasonable best efforts to list, on or prior to the
effective date of such registration statement, all Registrable Securities
covered by such registration statement on any securities exchange on
which any of the Registrable Securities is then listed, if any;
(xi) cooperate with each seller of Registrable Securities and each
underwriter or agent participating in the disposition of such Registrable
Securities and their respective counsel in connection with any filings
required to be made with the National Association of Securities Dealers;
(xii) enter into such agreements and take such other actions as
the Party issuing the Notice of Demand or the Requisite Holders, as the
case may be, shall reasonably request in order to expedite or facilitate
the disposition of such Registrable Securities, including making members
of senior management available for participation in any road show
organized by any underwriter or agent participating in the distribution
of the Registrable Securities that are the subject of a Requested
Registration; provided, that in no event shall Continental be required to
cause any officer, director or employee thereof to participate in any
such road show so organized in connection with the distribution of
Registrable Securities that are the subject of a Requested Registration
by Air Canada in accordance with Section 6.03 of the Stockholders
Agreements if a previous Requested Registration by Air Canada was deemed
to have been effected pursuant to Section 2.1(f) hereof; and
(xiii) promptly notify each seller and the underwriter or
underwriters, if any:
(a) when such registration statement or any prospectus used in
connection therewith, or any amendment or supplement thereto, has
been filed and, with respect to such registration statement or any
post-effective amendment thereto, when the same has become
effective;
(b) of any written comments from the SEC with respect to any
filing referred to in clause (a) and of any written request by the
SEC for amendments or supplements to such registration statement or
prospectus;
(c) of the notification to Continental by the SEC of its
initiation of any proceeding with respect to, or of the issuance by
the SEC of, any stop order suspending the effectiveness of such
registration statement; and
(d) of the receipt by Continental of any notification with
respect to the suspension of the qualification of any Registrable
Securities for sale under the applicable securities or blue sky laws
of any jurisdiction.
Each seller of Registrable Securities as to which any registration
is being effected shall furnish to Continental such information regarding such
seller, the Registrable Securities held by such seller and the intended plan
of distribution of such securities as Continental may from time to time
reasonably request in writing in connection with such registration.
Each seller of Registrable Securities agrees, by acquisition of such
Registrable Securities, that upon receipt of any notice from Continental of
the happening of any event of the kind described in clause (vii) of this
Section 2.5, such seller will forthwith discontinue such seller's disposition
of Registrable Securities pursuant to the registration statement relating to
such Registrable Securities until such seller's receipt of the copies of the
supplemented or amended prospectus contemplated by clause (vii) of this
Section 2.5 and, if so directed by Continental, will deliver to Continental
(at Continental's expense) all copies, other than permanent file copies, then
in such seller's possession of the prospectus relating to such Registrable
Securities current at the time of receipt of such notice. In the event
Continental shall give any such notice, the period referred to in clause (ii)
of this Section 2.5 shall be extended by a number of days equal to the number
of days during the period from the date of receipt of such notice by such
sellers to and including the date when each holder of any Registrable
Securities covered by such registration statement receives the copies of the
supplemented or amended prospectus contemplated by clause (vii) of this
Section 2.5.
2.6 Underwritten Offerings.
(a) Requested Underwritten Offerings. If requested by the
underwriters for any underwritten offering pursuant to a Requested
Registration, Continental will enter into an underwriting agreement with such
underwriters for such offering, such agreement to be reasonably satisfactory
in substance and form to the Party providing the Notice of Demand and to
contain such representations and warranties by Continental and such other
terms as are generally prevailing in agreements of this type, including,
without limitation, indemnities to the effect and to the extent provided in
Section 2.8. Each of the Parties participating in such registration shall be
a party to such underwriting agreement and may, at its option, require that
any or all of the representations and warranties by, and the other agreements
on the part of, Continental to and for the benefit of such underwriters shall
also be made to and for its benefit and that any or all of the conditions
precedent to the obligations of such underwriters under such underwriting
agreement be conditions precedent to its obligations thereunder. Neither Air
Partners nor Air Canada shall be required to make any representations or
warranties to or agreements with Continental other than representations,
warranties or agreements regarding such holder, such holder's Registrable
Securities and such holder's intended method of distribution and any other
representation required by law.
(b) Incidental Underwritten Offerings. If Continental at any time
proposes to register any of its securities under the Securities Act as
contemplated by Section 2.2 and such securities are to be distributed by or
through one or more underwriters, Continental will, if requested by any holder
or holders of Registrable Securities participating in such offering and
subject to Section 2.2(b), arrange for such underwriters to include all of the
Registrable Securities to be offered and sold by such holder or holders among
the securities to be distributed by such underwriters. The holders of
Registrable Securities to be distributed by such underwriters shall be parties
to the underwriting agreement between Continental and such underwriters,
provided such agreement is reasonably satisfactory in substance and form to
the Requisite Holders, and may, at their option, require that any or all of
the representations and warranties by, and the other agreements on the part
of, Continental to and for the benefit of such underwriters shall also be made
to and for the benefit of such holders of Registrable Securities and that any
or all of the conditions precedent to the obligations of such underwriters
under such underwriting agreement be conditions precedent to the obligations
of such holders of Registrable Securities thereunder. Any such holder of
Registrable Securities shall not be required to make any representations or
warranties to or agreements with Continental other than representations,
warranties or agreements regarding such holder, such holder's Registrable
Securities and such holder's intended method of distribution and any other
representation required by law.
2.7 Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this Agreement, Continental will give the holders of Registrable
Securities to be registered under such registration statement, their
underwriters, if any, and their respective counsel and accountants, the
opportunity to participate in the preparation of such registration statement,
each prospectus included therein or filed with the SEC in connection
therewith, and each amendment thereof or supplement thereto, and will give
each of them such reasonable access to its books and records and such
opportunities to discuss the business of Continental with its officers and the
independent public accountants who have certified its financial statements as
shall be necessary, in the opinion of such holders' and such underwriters'
respective counsel, to conduct a reasonable investigation within the meaning
of the Securities Act.
2.8 Indemnification.
(a) Indemnification by Continental. Continental agrees to
indemnify and hold harmless, to the full extent permitted by law, each holder
of Registrable Securities participating in an offering, its directors,
officers, employees, limited and general partners (either direct or indirect)
(and such partners' directors, officers, employees and agents), agents and
each other Person, if any, who controls such holder within the meaning of the
Securities Act (each such Person, an "Indemnified Party") from and against any
losses, claims, damages or liabilities, joint or several, to which such
Indemnified Party may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which such
securities were registered under the Securities Act, any preliminary
prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and Continental will reimburse such
Indemnified Party for any legal or any other expenses reasonably incurred by
it in connection with investigating or defending any such loss, claim,
liability, action or proceeding, provided that in any such case Continental
shall not be liable to any particular Indemnified Party to the extent that
such loss, claim, damage, liability (or action or proceeding in respect
thereof) or expense arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, any such preliminary prospectus, final prospectus,
summary prospectus, amendment or supplement in reliance upon and in conformity
with written information furnished to Continental by such Indemnified Party
specifically for inclusion therein; and provided, further, that Continental
shall not be liable in any such case to the extent it is finally determined by
a court of competent jurisdiction that any such loss, claim, damage, liability
or expense arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made
(i) in any such preliminary prospectus, if (A) it was the
responsibility of such Indemnified Party to provide the Person asserting
such loss, claim, damage, liability or expense with a current copy of the
prospectus and such Indemnified Party failed to deliver or cause to be
delivered a copy of the prospectus to such Person after Continental had
furnished such Indemnified Party with a sufficient number of copies of
the same and (B) the prospectus completely corrected such untrue
statement or omission; or
(ii) in such prospectus, if such untrue statement or omission is
completely corrected in an amendment or supplement to such prospectus and
the Indemnified Party thereafter fails to deliver the prospectus as so
amended or supplemented prior to or concurrently with the sale of
Registrable Securities to the Person asserting such loss, claim, damage,
liability or expense after Continental had furnished such Indemnified
Party with a sufficient number copies of the same.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of such Indemnified Party and shall survive
the transfer of such securities by such Indemnified Party. Continental shall
also indemnify each other Person who participates (including as an
underwriter) in the offering or sale of Registrable Securities, their officers
and directors and each other Person, if any, who controls any such
participating Person within the meaning of the Securities Act to the same
extent as provided above with respect to Indemnified Parties.
(b) Indemnification by the Sellers. Continental may require, as a
condition to including any Registrable Securities in any registration
statement filed pursuant to Section 2.5 and as a condition to indemnifying
such sellers pursuant to this Section 2.8, that Continental shall have
received an undertaking reasonably satisfactory to it from each prospective
seller of such securities, to indemnify and hold harmless (in the same manner
and to the same extent as set forth in paragraph (a) of this Section 2.8)
Continental, each director, officer, employee and agent of Continental, and
each other Person, if any, who controls Continental within the meaning of the
Securities Act, from and against any losses, claims, damages or liabilities
(or actions or proceedings, whether commenced or threatened, in respect
thereof) arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any registration statement under
which such securities were registered under the Securities Act, any
preliminary prospectus, final prospectus or summary prospectus contained
therein, or any amendment or supplement thereto, or any omission or alleged
omission from such registration statement, preliminary prospectus, final
prospectus or summary prospectus, or any amendment or supplement thereto
required to be stated therein or necessary to make the statements therein not
misleading, if (but only if) such untrue statement or alleged untrue statement
or omission or alleged omission was made in reliance upon and in conformity
with written information furnished to Continental by such prospective seller
specifically for inclusion therein; provided, however, that the obligation to
provide indemnification pursuant to this Section 2.8(b) shall be several, and
not joint and several, among such indemnifying parties. Such indemnity shall
remain in full force and effect, regardless of any investigation made by or on
behalf of Continental or any such director, officer, employee, agent or
participating or controlling Person and shall survive the transfer of such
securities by such prospective seller.
(c) Notices of Claims, etc. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a claim referred to in paragraphs (a) and (b) of this Section 2.8,
such indemnified party will, if a claim in respect thereof is to be made
against an indemnifying party, give prompt written notice to the latter of the
commencement of such action, provided that the failure of any indemnified
party to give notice as provided herein shall not relieve the indemnifying
party of its obligations under this Section 2.8, except to the extent that the
indemnifying party is actually and materially prejudiced or damaged by such
failure to give notice. In case any such action is brought against an
indemnified party, the indemnifying party shall be entitled to participate in
and to assume the defense and control thereof, jointly with any other
indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal fees or other expenses subsequently incurred
by the latter in connection with the defense thereof other than reasonable
costs of investigation; provided, however, that if, in such indemnified
party's reasonable judgment, a conflict of interest between such indemnified
and indemnifying parties may exist in respect of such claim, such indemnified
party shall be entitled to separate counsel at the expense of the indemnifying
party. In the event an indemnifying party shall not be entitled, or elects
not, to assume the defense of a claim, such indemnifying party shall not be
obligated to pay the fees and expenses of more than one counsel or firm of
counsel for all parties indemnified by such indemnifying party in respect of
such claim, unless in the reasonable judgment of any such indemnified party a
conflict of interest may exist between such indemnified party and any other of
such indemnified parties in respect of such claim, in which event the
indemnifying party shall be obligated to pay the fees and expenses of such
additional counsel (limited to one additional counsel) for such indemnified
party or parties. No indemnifying party shall, without the consent of the
indemnified party, consent to entry of any judgment or enter into any
settlement that (i) does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release
from all liability in respect of such claim or litigation or (ii) would impose
injunctive relief on such indemnified party. No indemnifying party shall be
subject to any liability for any settlement made without its consent, which
consent shall not be unreasonably withheld.
(d) Other Indemnification. The provisions of this Section 2.8
shall be in addition to any other rights to indemnification or contribution
which an indemnified party may have pursuant to law, equity, contract or
otherwise.
(e) Indemnification Payments. The indemnification required by this
Section 2.8 shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, promptly as and when bills are
received or expense, loss, damage or liability is incurred.
(f) Contribution. If for any reason (other than the reasons
expressly specified in this Section 2.8) the foregoing indemnity and
reimbursement is unavailable or is insufficient to hold harmless an
indemnified party under paragraphs (a) or (b) of this Section 2.8, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of any loss, claim, damage or liability (or
actions or proceedings, whether commenced or threatened, in respect thereof),
including, without limitation, any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss, claim,
damage, liability, action or proceeding, in such proportion as is appropriate
to reflect the relative fault of the indemnifying party on the one hand and
the indemnified party on the other. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the indemnifying party or the
indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. If, however, the allocation provided in the second preceding
sentence is not permitted by applicable law, or if the allocation provided in
the second preceding sentence provides a lesser sum to the indemnified party
than the amount hereinafter calculated, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative fault but also
the relative benefits to the indemnifying party and the indemnified party as
well as any other relevant equitable considerations. The parties agree that
it would not be just and equitable if contributions pursuant to this Section
2.8(f) were to be determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations
referred to in the preceding sentences of this Section 2.8(f).
Notwithstanding anything in this Section 2.8(f) to the contrary, no
indemnifying party (other than Continental) shall be required pursuant to this
Section 2.8(f) to contribute any amount in excess of the net proceeds received
by such indemnifying party from the sale of Registrable Securities in the
offering to which the losses, claims, damages or liabilities of the
indemnified parties relate. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation.
3. Rule 144. Continental will file the reports required to be
filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder (or, if Continental is not required
to file such reports, will, upon the request of the Parties, make publicly
available other information) and will take such further action as the Parties
may reasonably request, all to the extent required from time to time to enable
such parties to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by (i) Rule
144 under the Securities Act, as such Rule may be amended from time to time or
(ii) any similar rule or regulation hereafter adopted by the SEC. Upon the
reasonable request of the Parties, Continental will deliver to such parties a
written statement as to whether it has complied with such requirements and
will, at its expense, forthwith upon the request of any such Party, deliver to
such Party a certificate, signed by Continental's principal financial officer,
stating (a) Continental's name, address and telephone number (including area
code), (b) Continental's Internal Revenue Service identification number, (c)
Continental's SEC file number, (d) the number of shares of each class of
capital stock outstanding as shown by the most recent report or statement
published by Continental, and (e) whether Continental has filed the reports
required to be filed under the Exchange Act for a period of at least ninety
(90) days prior to the date of such certificate and in addition has filed the
most recent annual report required to be filed thereunder.
4. Amendments and Waivers. This Agreement may be amended,
supplemented or modified at any time, provided that each of the Parties and
Continental has provided its written consent to such amendment, supplement or
modification. Subject to Section 7, any term or condition of this Agreement
may be waived at any time by the party that is entitled to the benefit
thereof, but no such waiver shall be effective unless set forth in a written
instrument duly executed by or on behalf of the party waiving such term or
condition. No waiver by any party of any term or condition of this Agreement,
in any one or more instances, shall be deemed to be or construed as a waiver
of the same term or condition of this Agreement on any future occasion.
5. Entire Agreement; Other Agreements. Subject to Section 18,
this Agreement supersedes all prior discussions and agreements between the
parties with respect to the subject matter hereof, including the Registration
Rights Agreement and Section 1.10 (but only Section 1.10) of the Investment
Agreement, and contains the sole and entire agreement between the parties with
respect to the subject matter hereof.
6. No Third Party Beneficiary. The terms and provisions of this
Agreement are intended solely for the benefit of each party, their respective
Successors or permitted assigns and it is not the intention of the parties to
confer third-party beneficiary rights upon any other Person other than any
Person entitled to notice of the registration of Registrable Securities
pursuant to Section 2.2(a) or to indemnity under Section 2.8.
7. Invalid Provisions. If any provision of this Agreement is held
to be illegal, invalid or unenforceable under any present or future law, (i)
such provision will be fully severable, (ii) this Agreement will be construed
and enforced as if such illegal, invalid or unenforceable provision had never
comprised a part hereof, (iii) the remaining provisions of this Agreement will
remain in full force and effect and will not be affected by the illegal,
invalid or unenforceable provision or by its severance herefrom and (iv) in
lieu of such illegal, invalid or unenforceable provision, there will be added
automatically as a part of this Agreement a legal, valid and enforceable
provision as similar in terms to such illegal, invalid or unenforceable
provision as may be possible.
8. Nominees for Beneficial Owners. In the event that any
Registrable Securities are held by a nominee for the beneficial owner thereof,
the beneficial owner thereof may, at its election, be treated as the holder of
such Registrable Securities for purposes of request or other action by any
holder or holders of Registrable Securities pursuant to this Agreement or any
determination of any number or percentage of shares of Registrable Securities
held by any holder or holders of Registrable Securities contemplated by this
Agreement. If the beneficial owner of any Registrable Securities so elects,
Continental may require assurances reasonably satisfactory to it of such
owner's beneficial ownership of such Registrable Securities. For purposes of
this Agreement, beneficial owner (including, with its correlative meaning,
beneficial ownership ) has the meaning ascribed to it in Article Sixth,
Section 3 of the Restated Certificate.
9. Notices. All notices, requests and other communications
hereunder must be in writing and will be deemed to have been duly given only
if delivered personally or by facsimile transmission or mailed (first class
postage prepaid) to the parties at the following addresses or facsimile
numbers:
If to Air Canada, to:
Air Canada Center
Montreal International Airport (Dorval)
P.O. Box 14000 Postal Station St. Laurent
Canada H4Y 1H4
Facsimile No.: 514-422-5829
Attn.: Cameron DesBois, Vice President and General Counsel
If to Air Partners, to:
Air Partners, L.P.
201 Main Street, Suite 2420
Ft. Worth, Texas 76102
Facsimile No.: 817-871-4010
Attn.: James G. Coulter
If to Continental, to:
Continental Airlines, Inc.
2929 Allen Parkway, Suite 2010
Houston, Texas 77019
Facsimile No.: 713-520-6329
Attn.: Jeffery A. Smisek, Senior Vice President and General
Counsel
With respect to any other holder of Registrable Securities, such
notices, requests and other communications shall be sent to the addresses set
forth in the stock transfer records regularly maintained by Continental. All
such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section 9, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number
as provided in this Section 9, be deemed given upon receipt, and (iii) if
delivered by mail in the manner described above to the address as provided in
this Section 9, be deemed given upon receipt (in each case regardless of
whether such notice, request or other communication is received by any other
Person to whom a copy of such notice is to be delivered pursuant to this
Section 9). Any party from time to time may change its address, facsimile
number or other information for the purpose of notices to that party by giving
notice in accordance with this Section 9 specifying such change to the other
parties.
10. Assignment. This Agreement shall be binding upon and inure to
the benefit of and be enforceable by the parties and their respective
Successors and assigns. In addition, the Parties may assign (by written
instrument) any of their rights hereunder (in whole or in part) (a) to one or
more 100% Party Subsidiaries; or (b) except for the Parties rights under
Section 2.1, to one or more transferees of the Parties' Registrable
Securities, provided that such transferees may not subsequently assign such
rights to any other Person.
11. Descriptive Headings. The descriptive headings of the several
sections and paragraphs of this Agreement are inserted for convenience of
reference only and do not define or limit the provisions hereof or otherwise
affect the meaning hereof.
12. Specific Performance. The parties agree that, to the extent
permitted by law, (i) the obligations imposed on them in this Agreement are
special, unique and of an extraordinary character, and that in the event of a
breach by any such party damages would not be an adequate remedy; (ii) each to
the other parties shall be entitled to specific performance and injunctive and
other equitable relief in addition to any other remedy to which it may be
entitled at law or in equity; and (iii) any requirement for the securing or
posting of any bond in connection with the obtaining of any such injunctive or
other equitable relief is hereby waived.
13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
14. Majority of Shares. For purposes of this Agreement, the phrase
"majority of shares" shall mean a majority in number of such shares and, with
respect to the Warrants, such phrase shall refer to the number of shares into
which such Warrants are exercisable.
15. Registration Rights to Others. Continental represents and
warrants that it has not granted to any other Person rights with respect to
the registration of any Registrable Securities or any other securities issued
or to be issued by it, except for the registration rights granted by
Continental in connection with the PBGC Settlement (as defined in the
Investment Agreement).
16. Counterparts. This Agreement may be executed simultaneously in
any number of counterparts, each of which shall be deemed an original, but all
such counterparts shall together constitute one and the same instrument.
17. Provision of Information. Each Party shall, and shall cause
its officers, directors and employees to, complete and execute all
questionnaires and other similar documents as Continental shall reasonably
request as required in connection with a Requested Registration or Incidental
Registration to the extent such Party is participating in such registration.
18. Effectiveness. The obligations of the parties hereunder are
conditioned upon the occurrence of the Closing. Until Closing takes place,
this Agreement shall be of no force and effect, and the Registration Rights
Agreement shall continue in full force and effect.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly authorized
as of the date first above written.
CONTINENTAL AIRLINES, INC.
By: _________________________________________
Name: _____________________________________
Title: ____________________________________
AIR PARTNERS, L.P.
By: 1992 Air GP, as General Partner
By: 1992 Air, Inc., as General Partner
By: ____________________________________
Name: ______________________________
Title: _____________________________
AIR CANADA
By: __________________________________________
Name: ____________________________________
Title: _________________________________
EXHIBIT 99.1
Pursuant to Rule 13d-1(f)(1)(iii) of Regulation 13D-G of the General
Rules and Regulations of the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended, the undersigned agree that the
statement to which this Exhibit is attached is filed on behalf of them in the
capacities set forth hereinbelow.
AIR PARTNERS, L.P.
By: 1992 AIR GP,
General Partner
By: 1992 AIR, INC.,
General Partner
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
1992 AIR GP
By: 1992 AIR, INC.,
General Partner
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
AIR II GENERAL, INC.
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
1992 AIR, INC.
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
/s/James J. O'Brien
James J. O'Brien,
Attorney-in-Fact for each of:
DAVID BONDERMAN (1)
ALFREDO BRENER (2)
BONDERMAN FAMILY LIMITED PARTNERSHIP
By: David Bonderman, general partner
By:/s/James J. O'Brien,
Attorney-in-Fact for DAVID BONDERMAN(1)
BONDO AIR LIMITED PARTNERSHIP
By: 1992 AIR, INC.,
General Partner
By:/s/James J. O'Brien
James J. O'Brien,
Vice President
(1) A Power of Attorney authorizing James J. O'Brien to act on behalf of
David Bonderman was previously filed with the Commission.
(2) A Power of Attorney authorizing James J. O'Brien to act on behalf of
Alfredo Brener was previously filed with the Commission.