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Hughes Hubbard & Reed LLP
One Battery Park Plaza
New York, New York 10004-1482
July 22, 1997
VIA EDGAR
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Mr. William L. Tolbert, Jr.
Securities and Exchange Commission
450 Fifth Street, NW
Washington, D.C. 20549
Re: Continental Airlines, Inc.
FORM S-4, FILE NO. 333-27851
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Dear Mr. Tolbert:
On behalf of our client, Continental Airlines, Inc., a Delaware
corporation (the "Company"), this will respond to the request of the Staff for
supplemental information regarding comment 2 in the letter from the Staff dated
July 15, 1997 with respect to the Company's Registration Statement on Form S-4,
Registration No. 333-27851, which was originally filed with the Commission on
May 27, 1997 and as to which Amendment No. 1 was filed on July 2, 1997 and
Amendment No. 2 was filed on July 15, 1997 (as amended, the "Registration
Statement").
The definitive agreement providing for the $575 million credit
facility contemplated by the commitment letter described in the Registration
Statement was entered into by the Company on July 18, 1997. Accordingly, the
Company intends to revise the disclosure in the Registration Statement to
reflect the execution of such definitive agreement. The Company acknowledges
that it may be required to file the definitive credit facility as an exhibit to
its Quarterly Report on Form 10-Q for the quarter ended September 30, 1997. The
Company intends to determine at the time of such filing whether such credit
facility is material to the Company.
The Company believes that the letter of intent with UMDA entered into
in late May 1997 is not a material contract. The UMDA letter of intent
contemplates the purchase of a 9% interest in Air Micronesia, Inc. ("AMI"),
which is currently a 91%-owned consolidated subsidiary of the Company. AMI's
financial results are included in the Company's historical consolidated
financial statements that are incorporated by reference into the Registration
Statement, and the Company believes that the elimination of the 9% minority
interest in AMI and of the related payments to AMI will not have a material
affect on the Company's future consolidated financial statements. In addition,
the consideration to be paid by the Company in connection with the transaction
described in the letter of intent consists of $73 million in cash. At March 31,
1997, the Company had total cash of $927 million and total assets of $5.3
billion. Accordingly, the $73 million payment will comprise less than 1.5% of
the Company's total assets as of March 31, 1997.
Please advise us at your earliest convenience whether the Staff will
have any further comments on the Registration Statement. The Company wishes to
commence the Exchange Offer as soon as possible. Please contact John K. Hoyns
(212-837-6762) or Sean Kurzweil (212-837-6895) of our New York office should you
wish to discuss any aspect of this response.
Yours very truly,
/s/ Hughes Hubbard & Reed LLP
cc: James J. Moloney
Securities and Exchange Commission
Jeffery A. Smisek
Jennifer L. Vogel
Continental Airlines