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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4)*
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)
May 8, 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 3,983,193 of
Class A and Class B shares, respectively, which constitutes approximately
54.6% and 16.0%, 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 - 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: 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) Assumes acquisition of 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 - 63,652 (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 - 63,652 (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 - 3,446,284 (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 - 54.5% (3)(5)
Class B - 13.6% (4)(6)
14. Type of Reporting Person: CO
- ------------
(1) Power is exercised through its controlling shareholder, David
Bonderman.
(2) 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.
(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) 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.
(5) 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.
(6) 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 - 597,561 (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 - 597,561 (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 - 3,983,193 (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 - 16.0% (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 63,652 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 - 0
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 - 0
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 - 571,875 (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 - 2.6% (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 - 0
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 - 0
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 - 563,297 (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 - 2.6% (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, Amendment No. 2
dated April 3, 1996 and Amendment No. 3 dated April 26, 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.
No material change.
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, Air II 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, INC.
Because of its position as one of two general partners of 1992 Air
GP, Air, Inc., 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 3,446,284 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.
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 92,684 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 3,983,193 shares of the Class B Stock, which constitutes
approximately 16.0% 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 and 571,875 shares of Class B Stock, which
constitutes approximately 2.6% 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 563,297 shares of the Class
B Stock, which constitutes approximately 2.6% 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.
AIR, INC.
In its capacity as the majority general partner of 1992 Air GP, 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 63,652 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 63,652 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 92,684 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 no
power to vote or to direct the vote or to dispose or to direct the disposition
of any 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.
Brenner has no power to vote or to direct the vote or to dispose or to direct
the disposition of any shares of the Class B Stock.
(c) As reported in Item 6 of the most recent amendment to the
Schedule 13D, the Issuer agreed, pursuant to the Stockholders' Agreement
Amendment dated as of April 19, 1996, to effect the Registration of certain
shares of the Class B Common Stock beneficially owned by Air Canada and by the
partners in Air Partners and to engage a lead underwriter to conduct the
Offering of such shares on a firm commitment basis. On May 8, 1996, the
following Reporting Persons sold shares of the Class B Stock in the Offering
at a price per share of $51.84, as follows:
NUMBER
REPORTING PERSON OF SHARES
Bonderman 50,000
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.
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.
The various agreements between and among the Issuer, Air Canada and
certain of the Reporting Persons pursuant to the Stockholders' Agreement
Amendment and the Restated Registration Rights Agreement disclosed in Item 6
of the most recent amendment to this Schedule 13D will become effective upon
the closing of the Offering, which will occur on May 14, 1996. In particular,
pursuant to the Stockholders' Agreement Amendment, Air Canada has granted to
Air Partners the Air Canada Proxy which enables 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.
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.
As previously disclosed in this Item 6, 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.
On May 2, 1996, Air Partners entered into a Warrant Purchase
Agreement (the "Warrant Purchase Agreement") with the Issuer. Pursuant to the
Warrant Purchase Agreement, Air Partners, at its election, may for the one-
year period commencing August 15, 1996, sell to the Issuer up to $50 million
in intrinsic value (then-current Class B Common Stock price minus exercise
price) of Air Partners' Class B Warrants. The Issuer has also agreed,
pursuant to the Warrant Purchase Agreement, that at any time after December
16, 1996, upon the written request of Air Partners, it will agree to amend the
terms of the Class B Warrants to permit the "cashless exercise" of the Class
B Warrants. A "cashless exercise" would allow Air Partners, upon the exercise
of Class B Warrants, to deliver to the Issuer Class B Warrants with an
aggregate intrinsic value equal to the aggregate exercise price of the Class
B Warrants being exercised in payment therefor.
The description set forth in this Item 6 of the Warrant Purchase
Agreement does not purport to be complete and is qualified in its entirety by
reference to such agreement, which is being filed as an exhibit to this
Schedule 13D.
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, previously filed.
Exhibit 4.8 Amended and Restated Registration Rights Agreement, dated as of
April 19, 1996 among the Issuer, Air Partners, and Air Canada,
previously filed.
Exhibit 4.9 Warrant Purchase Agreement, dated as of May 2, 1996, by and
between the Issuer and Air Partners, 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: May 13, 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 4.9
WARRANT PURCHASE AGREEMENT
WARRANT PURCHASE AGREEMENT, dated as of May 2, 1996 (the "Agreement"),
by and between Continental Airlines, Inc., a Delaware corporation
("Continental") and Air Partners, L.P., a Texas limited partnership ("Air
Partners").
W I T N E S S E T H
WHEREAS, pursuant to the Stockholders' Agreement, the Investment
Agreement and the Warrant Agreement (each as hereinafter defined), Continental
issued to Air Partners warrants to purchase up to an aggregate of 2,557,600
shares of Class B common stock, par value $.01 per share, of Continental
("Class B Common Stock") at an initial exercise price of $15.00 per share and
up to an aggregate of 825,032 shares of Class B Common Stock at an initial
exercise of $30.00 per share (collectively, the "Warrants").
WHEREAS, pursuant to the Amendment to Subscription and Stockholders'
Agreement (the "Stockholders Agreement Amendment"), dated as of April 19,
1996, between Continental, Air Partners and Air Canada, a Canadian corporation
("Air Canada"), Air Partners has agreed not to make certain transfers or
acquisitions of Continental securities (including Warrants) prior to December
16, 1996;
WHEREAS, Air Partners desires to have the right to require Continental
to repurchase the Warrants, subject to certain specified limitations, and
Continental desires to repurchase such Warrants, all on the terms and subject
to the conditions as hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants
and obligations hereinafter set forth, the parties hereto agree as follows:
1. Definitions
The following terms used in the Agreement shall have the following
meanings (all terms defined in the singular have the correlative meanings when
used in the plural and vice versa).
"Act" shall mean the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.
"Agreement" shall mean this Agreement, as originally executed and as
modified, amended or supplemented from time to time.
"Blackout Period" shall have the meaning specified in Section 2(b)
hereof.
"Business Day" shall mean any day that is not a Saturday, Sunday or
other day on which banking institutions in New York, New York are authorized
or required by law or executive order to close.
"Class B Common Stock" shall have the meaning set forth in the recitals
hereto.
"Consent Fee" shall have the meaning specified in Section 5(a).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Earnings Release Date" shall have the meaning specified in Section
2(b).
"GE" shall have the meaning specified in Section 5(a).
"GE Expenses" shall mean the Consent Fee together with any other
reasonable and documented out-of-pocket expenses incurred by Continental
(including reasonable fees and expenses of GE's counsel) in connection with
the actions taken by it pursuant to Section 5(a).
"Intrinsic Value" shall mean, on a per Warrant basis, the positive
difference between the Market Price Per Share and the Warrant Price, each as
determined on the Notification Date.
"Investment Agreement" shall mean the Investment Agreement, dated as of
November 9, 1992, as amended on January 13, 1993, among Air Partners, Air
Canada, Continental and Continental Holdings, Inc., as it may be further
amended from time to time.
"Loan Agreements" shall have the meaning specified in Section 5(a).
"Market Price Per Share" shall mean the per share closing price,
regular way, of Class B Common Stock on the NYSE on the Notification Date.
"Notification Date" shall mean the date on which a Repurchase Notice is
delivered by Air Partners to Continental in accordance with Section 2(a).
"NYSE" shall mean the New York Stock Exchange, Inc.
"Person" shall mean any natural person, corporation, division of a
corporation, partnership, trust, joint venture association, limited liability
company, company, estate, unincorporated organization or governmental entity.
"Preliminary Repurchase Notification" shall have the meaning set forth
in Section 2(a).
"Put Date" shall mean the date which is the third Business Day
following the Notification Date.
"Repurchase Notice" shall mean a written notice delivered to
Continental by Air Partners specifying (i) that Air Partners is electing to
exercise its put right in accordance with this Agreement, (ii) the number of
Warrants Air Partners desires Continental to repurchase, (iii) the account or
accounts to which the Repurchase Price should be paid and (iv) that Air
Partners has all authority, consents and approvals necessary to sell the
Warrants specified in such notice.
"Repurchase Price" shall mean the Intrinsic Value multiplied by the
number of Warrants to be repurchased by Continental as set forth in the
Repurchase Notice.
"Stockholders' Agreement" shall mean the Subscription and Stockholders'
Agreement, dated as of April 27, 1993, among Continental, Air Partners and Air
Canada.
"Stockholders Agreement Amendment" shall have the meaning specified in
the recitals hereto.
"Warrant Agreement" shall mean the Warrant Agreement, dated as of April
27, 1993, between Continental in its corporate capacity and Continental in its
capacity as warrant agent.
"Warrant Price" shall have the meaning specified in the Warrant
Agreement and shall be subject to adjustment from time to time in accordance
with Article IV thereof.
"Warrants" shall have the meaning specified in the recitals hereto.
2. Repurchase of Warrants
(a) In the event Air Partners desires to sell its Warrants to
Continental pursuant to the terms hereof (i) it shall use good faith efforts
to provide (including by telephone) to Continental's Chief Financial Officer
or General Counsel, not later than 1 P.M. Eastern Time on the date of such
intended sale, preliminary advance notice (a "Preliminary Repurchase
Notification") of its intention to exercise its put right hereunder and (ii)
shall deliver to Continental at its principal office not later than 7 P.M.
Eastern Time on the date of such intended sale, a Repurchase Notice confirming
(or, if a Preliminary Repurchase Notification was not delivered pursuant to
clause (i) of this Section 2(a), notifying Continental of) the exercise by Air
Partners of its put right hereunder, provided, that (x) the delivery of a
Preliminary Repurchase Notification alone shall in no way obligate Air
Partners to sell Warrants to Continental pursuant to the terms of this
Agreement and (y) the failure to provide a Preliminary Repurchase Notification
shall not preclude the delivery by Air Partners of a valid Repurchase Notice.
(b) Upon its receipt of a Repurchase Notice, Continental shall,
upon the terms and subject to the conditions of this Agreement, be required to
repurchase each Warrant specified in the Repurchase Notice at its Intrinsic
Value, provided that (i) in no event shall Continental be required to
repurchase during the term hereof Warrants with an aggregate Intrinsic Value
of more than $50 million and (ii) Continental may, at its option, determine
not to repurchase Warrants specified in any Repurchase Notice delivered by Air
Partners during any five-Business Day period (the "Blackout Period")
commencing on the Business Day following the date on which Continental
releases quarterly and annual earnings reports (such date of release, the
"Earnings Release Date") if Continental has notified Air Partners at least two
Business Days prior to the relevant Earnings Release Date of its determination
not to repurchase Warrants during the Blackout Period.
(c) Continental agrees that at any time after December 16, 1996,
upon the written request of Air Partners, and provided Air Partners has
complied with its obligations set forth in Section 12 of the Stockholders
Agreement Amendment, it will agree to amend the terms of the Warrants and, to
the extent necessary, the Warrant Agreement, to permit the "cashless exercise"
of the Warrants, it being understood that a "cashless exercise" represents the
exercise of Warrants by Air Partners, and the corresponding delivery by Air
Partners to Continental of Warrants with an aggregate Intrinsic Value equal to
the aggregate Warrant Price of the Warrants so exercised, in consideration
therefor. The parties agree that the aforementioned method of "cashless
exercise" may be modified (including, without limitation, to permit the
transfer by Air Partners of shares of Class B Common Stock in payment of the
exercise price of the Warrants so exercised) to the extent deemed necessary by
Air Partners to avoid adverse consequences to Air Partners under Section 16 of
the Exchange Act that may arise in connection with any "cashless exercise."
3. Method of Repurchase. Upon the terms and subject to the
conditions of this Agreement, at 11:00 a.m. (Eastern Standard Time) on any Put
Date with respect to which Continental has received a Repurchase Notice, at
the principal offices of Continental, or at such other time or place as
Continental and Air Partners may agree (a) Air Partners shall transfer to
Continental full right, title and interest in and to the Warrants specified in
its' Repurchase Notice, free and clear of any and all mortgages, liens,
pledges, charges, security interests, encumbrances or adverse claims of any
kind and nature in respect of such Warrants, and shall deliver to Continental
a certificate or certificates representing such Warrants, in each case duly
endorsed for transfer or accompanied by appropriate stock transfer powers duly
endorsed; and (b) Continental shall pay to Air Partners, in full payment of
the Warrants specified in the Repurchase Notice, an amount equal to the
Repurchase Price, less, except as otherwise provided in Section 5(a), any GE
Expenses incurred by Continental pursuant to Section 5(a), by wire transfer of
immediately available funds to the account or accounts specified in the
Repurchase Notice.
4. Certain Conditions to Repurchase. Continental's obligation to
repurchase any Warrants pursuant to Section 3 hereof shall be subject to the
satisfaction, or the written waiver by Continental, of the following
conditions: (i) the repurchase of Warrants shall not contravene any law,
rule, order, rule, regulation or ordinance of any federal, state or local
government or regulatory authority, including the Act or the Exchange Act,
(ii) no preliminary or permanent injunction or other order against the
repurchase of Warrants issued by any federal, state or other court of
competent jurisdiction within or without the United States shall be in effect
and (iii) Air Partners has, prior to the Put Date, complied with its
obligations set forth in Section 12 of the Stockholders Agreement Amendment.
5. Additional Obligations of Continental.
(a) In order to comply with its obligations hereunder, and for so
long as the Series B-1 Loan Agreement or the Series B-2 Loan Agreement, each
as amended (the "Loan Agreements") between Continental and global Project &
Structured Finance Corporation remain in full force and effect, Continental
agrees to take any and all actions necessary to obtain from Global Project &
Structured Finance Corporation or its affiliates ("GE") the consents to the
transactions contemplated by Section 3 hereof required pursuant to the terms
of such Loan Agreements, including paying any amount to GE in exchange for
such consent (the "Consent Fee"), provided, that the portion of the GE
Expenses allocated to the Consent Fee shall not be deducted as specified in
Section 3(b) hereof unless Continental shall have obtained the written consent
of Air Partners prior to the payment of any Consent Fee to GE.
(b) Notwithstanding anything to the contrary contained in
paragraph (a) of this Section 5, Continental shall use its best efforts to (i)
refinance, prior to June 30, 1996, its remaining obligations under the Loan
Agreements on the same or better terms to Continental so as to permit the
transactions contemplated by Section 3 hereof and (ii) obtain any consent
required from GE in connection with the performance of its obligations
hereunder without paying a Consent Fee; provided, that Continental shall have
no obligation to purchase Warrants under this Agreement if Continental has
complied with this Section 5(b) and Air Partners does not consent to the
payment of any applicable Consent Fee to GE.
6. Term and Termination. Unless earlier terminated by written
agreement of the parties hereto, this Agreement shall be effective for a
period of one year commencing August 15, 1996, provided, however, that (i) the
obligations of Continental set forth in Section 5(b)(i) shall be in full force
and effect as of the date hereof and (ii) the obligations of the parties
hereto set forth in Section 2(c) shall continue in full force and effect until
April 27, 1998.
7. Assignment.
(a) This Agreement and all of the provisions hereof shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns; provided, however, that, except
as set forth in paragraph (b) of this Section 7, neither this Agreement nor
any of the rights or obligations hereunder shall be assigned by either party
hereto without the prior written consent of the other party.
(b) Notwithstanding the foregoing, Air Partners may, at any time
and from time to time, transfer Warrants to its partners and, in connection
therewith, may assign the rights associated with such Warrants under Section
2(c) hereof to such partners.
8. Amendment: Severability. This Agreement may be altered or
amended only with the written consent of each of the parties. If any
provision of this Agreement shall be held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions hereof shall not be affected or impaired thereby.
9. Notices.
(a) Except for the Preliminary Repurchase Notification, all
notices, requests, documents or other communications required or permitted
hereunder shall be in writing and shall be delivered (i) by personal delivery
or (ii) by sending a facsimile transmission of a copy of such writing,
addressed as follows:
if to Continental:
Continental Airlines, Inc.
Suite 2010
2929 Allen Parkway
Houston, Texas 77019
Attention: Chief Financial Officer and General Counsel
Fax: (713) 523-2831
if to Air Partners:
Air Partners, L.P.
201 Main Street, Suite 2420
Fort Worth, Texas 76102
Attention: James G. Coulter
Fax: (817) 871-4010
(b) Each party by written notice given to the other party in
accordance with this Section 9 may change the name or address to which
notices, requests, documents or other communications are to be sent to such
party. All notices, requests, documents or other communications hereunder
shall be deemed to have been given (i) upon actual delivery when given by
personal delivery or (ii) upon receipt of facsimile confirmation when
delivered by facsimile transmission.
10. Complete Agreement: Counterparts. This Agreement constitutes the
entire agreement among the parties hereto relating to the subject matter
hereof, and all prior agreements and understandings, written or oral, with
respect thereto are superseded. This Agreement may be executed by the parties
in any number of counterparts, each of which shall be deemed to be an
original, but all of which together shall constitute one and the same
instrument.
11. Headings. The section headings herein are for convenience of
reference only and in no way define, limit or extent the scope or intent of
this Agreement or any provisions hereof.
12. Choice of Law: Submission to Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
(b) Each of the parties hereto irrevocably consents and submits
(i) to the exclusive jurisdiction of the State and Federal courts located in
the County of New York in the State of New York in connection with any suits,
actions or other proceedings arising between or among such parties under this
Agreement and (ii) to the laying of venue in any such court in any such suit,
action or proceeding. Each of such parties irrevocably agrees that such
suits, actions or proceedings may only be commenced or prosecuted in such
courts, and each irrevocably waives any claim that any such court constitutes
an inconvenient forum for the prosecution of such suit, action or proceeding.
Each of the parties irrevocably agrees not to seek the transfer to any court
located outside the County of New York of any such suit, action or proceeding.
13. Third-Party Rights. Except as specifically provided herein, this
Agreement is not intended to confer any benefits upon, or create any rights in
favor of, any Person other than the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year 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:
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.