View:
As filed with the Securities and Exchange Commission on
December 2, 1998.
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
CONTINENTAL AIRLINES, INC.
(Exact name of Registrant as specified in its charter)
4512
(Primary Standard Industrial
Classification Code Number)
Delaware 74-2099724
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1600 Smith Street, Dept. HQSEO
Houston, Texas 77002
(713) 324-2950
(Address, including zip code, and telephone number,
including area code, of registrant's
principal executive offices)
______________
CONTINENTAL AIRLINES, INC.
DEFERRED COMPENSATION PLAN
(Full title of the plan)
Jeffery A. Smisek
Executive Vice President and
General Counsel
Continental Airlines, Inc.
1600 Smith Street, Dept. HQSEO
Houston, Texas 77002
(713) 324-2950
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of maximum maximum
Securities Amount offering aggregate Amount of
to be to be price per offering registration
registered registered share (1) price (1) fee
Deferred
Compensation
Obligations
Class B Common
Stock, par
value $.01
per share (the
"Common Stock")
Total $15,000,000 100% $15,000,000 $4,170
(1) The Deferred Compensation Obligations of the Registrant to pay
deferred compensation in the future in accordance with the
terms of the Continental Airlines, Inc. Deferred Compensation
Plan.
(2) The amount to be registered is estimated solely for purposes
of calculating the registration fee and includes such
indeterminate number of shares of the Registrant's Class B
Common Stock as may be issued at indeterminate prices from
time to time as one of the various investment options for
participants in the Continental Airlines, Inc. Deferred
Compensation Plan.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents which have been filed with the
Securities and Exchange Commission (the "Commission") by
Continental Airlines, Inc., a Delaware corporation (the "Company"),
are incorporated herein by reference and made a part hereof: (i)
the Company's Annual Report on Form 10-K for the year ended
December 31, 1997, filed on March 19, 1998, (ii) the Company's
Current Reports on Form 8-K dated January 25, February 20, March 3,
April 21, July 30, 1998, September 24, 1998, November 16, 1998 and
November 20, 1998, and (iii) the Company's Quarterly Reports on
Form 10-Q for the quarters ended March 31, 1998, June 30, 1998 and
September 30, 1998.
All documents filed by the Company pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), subsequent to the
effective date of this Registration Statement, prior to the filing
of a post-effective amendment to this Registration Statement
indicating that all securities offered hereby have been sold or
deregistering all securities then remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from
the date of filing of such documents. Any statement contained
herein or in any document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a
statement contained in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed to constitute a part of
this Registration Statement, except as so modified or superseded.
The Company will provide without charge to any person to
whom a copy of this Registration Statement has been delivered, upon
written or oral request, a copy of any or all of the foregoing
documents incorporated herein by reference (other than exhibits to
such documents unless such exhibits are specifically incorporated
by reference into such documents). Requests should be directed to
Continental Airlines, Inc., 1600 Smith Street, Dept. HQSEO,
Houston, Texas 77002, Attention: Secretary, telephone (713) 324-
2950.
Item 4. Description of Securities.
The Deferred Compensation Obligations registered hereunder
(the "Obligations") are unsecured obligations of the Registrant to
pay deferred compensation in the future in accordance with the
terms of the Continental Airlines, Inc. Deferred Compensation Plan
(the "Plan"), which is filed as Exhibit 4.3 to this Registration
Statement, and the Continental Airlines, Inc. Deferred Compensation
Plan Trust Agreement (the "Trust Agreement"), a form of which
consistent in all material respects to the Trust Agreement is filed
as Exhibit 4.4 to this Registration Statement. Such Exhibits set
forth a description of the Obligations and are incorporated herein
by reference in their entirety in response to this Item 4, pursuant
to Rule 411(b)(3) under the Securities Act of 1933.
No participant under the Plan shall have any preferred
claim to, or any beneficial ownership interest in, any assets which
are subject to the Trust established by the Trust Agreement (the
"Trust"). All such assets are subject to the claims of the
creditors of the participant's employer until they are paid out of
the Trust to the participant in accordance with the terms of the
Plan. The Plan provides that the Obligations of the Registrant's
subsidiaries are separate and will be administered by separate sub-
trusts for each subsidiary; provided that payment of the
Obligations of the Registrant's subsidiaries has been guaranteed by
the Registrant.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Reference is made to Section 102(b)(7) of the Delaware
General Corporation Law (the "DGCL"), which enables a corporation
in its original certificate of incorporation or an amendment
thereto to eliminate or limit the personal liability of a director
for violations of the director's fiduciary duty, except (i) for any
breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii)
pursuant to Section 174 of the DGCL (providing for liability of
directors for unlawful payment of dividends or unlawful stock
purchases or redemptions) or (iv) for any transaction from which a
director derived an improper personal benefit. The Certificate of
Incorporation and Bylaws of the Company contain provisions
eliminating the liability of directors to the extent permitted by
Section 102(b)(7) of the DGCL.
The Company is empowered by Section 145 of the DGCL,
subject to the procedures and limitations stated therein, to
indemnify any person against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and
reasonably incurred by him or her in connection with any
threatened, pending or completed action, suit or proceeding in
which such person is made a party by reason of his or her being or
having been a director, officer, employee or agent of the Company.
The statute provides that indemnification pursuant to its
provisions is not exclusive of other rights of indemnification to
which a person may be entitled under any by-law, agreement, vote of
stockholders or disinterested directors, or otherwise. Article 5.1
of the Bylaws of the Company provides for indemnification of each
of the Company's directors, officers and employees to the full
extent permitted by the DGCL.
The Human Resources Committee will appoint a committee
(the "Committee") to administer the plan. The Company has agreed to
indemnify the members of the Committee ("Indemnitee") against any
suits, claims, damages or expenses ("Liabilities") which may be
made against or incurred by them arising out of their good faith
discharge of their responsibilities under or incident to the Plan,
which indemnification could include Liabilities made under
applicable securities laws in connection with offerings of
securities of the Company. The Company will not be obligated to
indemnify any Indemnitee in the event that any such suit, claim,
damage or expense is based upon willful misconduct.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
4.1 Amended and Restated Certificate of Incorporation
of the Company (incorporated by reference to
Exhibit 4.1(a) to the Company's Registration
Statement on Form S-8 (No. 333-06993)).
4.2 By-laws of the Company (incorporated by reference
to Exhibit 99.3 to the Company's Report on Form 8-
K dated November 20, 1998).
*4.3 Continental Airlines, Inc. Deferred Compensation
Plan.
*4.4 Form of Continental Airlines, Inc. Deferred
Compensation Plan Trust Agreement.
*5.1 Legal Opinion of Jeffery A. Smisek.
*23.1 Consent of Ernst & Young LLP.
*24.1 Powers of Attorney.
_____________________________
* Filed with this Registration Statement.
UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933, as amended
(the "1933 Act");
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement;
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
Registration Statement or any material change to such
information in the Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply
if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to Section 13 or Section 15(d) of
the Exchange Act that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under
the 1933 Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(4) That, for the purposes of determining any liability
under the 1933 Act, each filing of the Registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange Act
(and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that
is incorporated by reference in the Registration Statement shall be
deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the
1933 Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is
against public policy as expressed in the 1933 Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer
or controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the 1933 Act and will be governed by the final adjudication of such
issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Houston, State of Texas, on
December 1, 1998.
CONTINENTAL AIRLINES, INC.
By:
Jeffery A. Smisek
Executive Vice President and
General Counsel
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Signature Title Date
* Chairman of the Board December 1, 1998
Gordon M. Bethune and Chief Executive
Officer (Principal
Executive Officer)
and Director
* Executive Vice December 1, 1998
Lawrence W. Kellner President and Chief
Financial Officer
(Principal Financial
Officer)
* Vice President and December 1, 1998
Michael P. Bonds Controller (Principal
Accounting Officer)
* Director December 1, 1998
Thomas J. Barrack, Jr.
* Director December 1, 1998
Lloyd M. Bentsen, Jr.
* Director December 1, 1998
David Bonderman
* Director December 1, 1998
Gregory D. Brenneman
* Director December 1, 1998
Patrick Foley
* Director December 1, 1998
Douglas H. McCorkindale
* Director December 1, 1998
George G.C. Parker
* Director December 1, 1998
Richard W. Pogue
* Director December 1, 1998
William S. Price III
* Director December 1, 1998
Donald L. Sturm
* Director December 1, 1998
Karen Hastie Williams
* Director December 1, 1998
Charles A. Yamarone
*By /s/ Scott Peterson
Scott Peterson
Attorney in-Fact
December 1, 1998
Exhibit 4.3
CONTINENTAL AIRLINES, INC.
DEFERRED COMPENSATION PLAN
Effective January 1, 1999
TABLE OF CONTENTS
ARTICLE PAGE
I - Definitions and Construction . . . . . . . . . . I-1
II - Participation . . . . . . . . . . . . . . . . . II-1
III - Account Credits and Allocations of Income or
Loss . . . . . . . . . . . . . . . . . . . . . . III-1
IV - Deemed Investment of Funds . . . . . . . . . . . IV-1
V - Determination of Vested Interest . . . . . . . . V-1
VI - In-Service Distributions . . . . . . . . . . . . VI-1
VII - Termination Benefits . . . . . . . . . . . . . . VII-1
VIII - Administration of the Plan . . . . . . . . . . . VIII-1
IX - Administration of Funds. . . . . . . . . . . . . IX-1
X - Nature of the Plan . . . . . . . . . . . . . . . X-1
XI - Miscellaneous . . . . . . . . . . . . . . . . . XI-1
CONTINENTAL AIRLINES, INC.
DEFERRED COMPENSATION PLAN
W I T N E S S E T H :
WHEREAS, CONTINENTAL AIRLINES, INC. has decided to adopt the
following CONTINENTAL AIRLINES, INC. DEFERRED COMPENSATION PLAN,
hereinafter referred to as the "Plan," to aid certain of its
employees and directors in making more adequate provision for their
retirement;
NOW THEREFORE, the Plan is hereby adopted as follows,
effective as of January 1, 1999:
I.
Definitions and Construction
1.1 Definitions. Where the following words and phrases
appear in the Plan, they shall have the respective meanings set
forth below, unless their context clearly indicates to the
contrary.
(1) Account: An individual account for each Member to which is
credited his Compensation deferrals pursuant to Section 3.1
and which is credited (or debited) for such account's
allocation of net income (or net loss) as provided in Section
3.2.
(2) Annual Bonus: The annual incentive bonus, if any, paid in
cash by the Employer to or for the benefit of a Member for
services rendered or labor performed while a Member.
(3) Annual Retainer: The annual retainer paid in cash by the
Company to or for the benefit of a Nonemployee Director.
(4) Base Salary: The base rate of pay paid in cash by the
Employer to or for the benefit of a Member for services
rendered or labor performed while a Member.
(5) Change in Control: The term "Change in Control" shall have the
same meaning as is assigned to such term under the Company's
1998 Stock Incentive Plan, as in effect on the Effective Date.
(6) Code: The Internal Revenue Code of 1986, as amended.
(7) Committee: The administrative committee appointed by the
Human Resources Committee to administer the Plan.
(8) Company: Continental Airlines, Inc.
(9) Company Stock: The Class B common stock, par value $0.01 per
share, of the Company.
(10) Company Stock Fund: A Fund consisting of a deemed
investment in Company Stock.
(11) Compensation: With respect to a Member who is a Nonemployee
Director, such Member's Annual Retainer and Meeting Fees.
With respect to any other Member, such Member's Annual Bonus,
Base Salary, Executive Bonus, and Stay Bonus. Each component
of a Member's Compensation shall be determined by including
any portion thereof that such Member could have received in
cash in lieu of (a) Compensation deferrals pursuant to Section
3.1 or (b) elective contributions made on his behalf by the
Employer pursuant to a qualified cash or deferred arrangement
(as defined in section 401(k) of the Code) or pursuant to a
plan maintained under section 125 of the Code.
(12) Disability: With respect to a Member who is a Nonemployee
Director, a disability that renders such Member permanently
and totally unable to perform his duties as a director of the
Company as a result of any medically determinable physical or
mental impairment as supported by a written medical opinion to
the foregoing effect by a physician selected by the Committee
(unless such medical opinion is waived by the Committee as
unnecessary). With respect to any other Member, a disability
entitling such Member to benefits under the Company's group
long-term disability plan.
(13) Effective Date: January 1, 1999.
(14) Election Date: The first day of each Plan Year.
(15) Employer: The Company and any other adopting entity (which
must be a Subsidiary) that adopts the Plan pursuant to the
provisions of Section 2.3. As of the Effective Date, each of
the Company, Continental Express, Inc., and Continental
Micronesia, Inc. is an Employer.
(16) Exchange Act: The Securities Exchange Act of 1934, as
amended.
(17) Executive Bonus: The quarterly incentive bonus, if any, paid
in cash by the Employer to or for the benefit of a Member for
services rendered or labor performed while a Member, whether
pursuant to the Company's Executive Bonus Plan or otherwise.
(18) Funds: The investment funds designated from time to time for
the deemed investment of Accounts pursuant to Article IV.
(19) Human Resources Committee: The Human Resources Committee of
the Board of Directors of the Company.
(20) Insider: A Member who is an officer or director of the
Company or any Subsidiary and who is subject to Section 16(b)
of the Exchange Act.
(21) Market Value per Share: As of any specified date, the closing
sales price of the Company Stock on that date (or, if there
are no sales on that date, the last preceding date on which
there was a sale) in the principal securities market in which
the Company Stock is then traded. If the Company Stock is not
publicly traded at the time a determination of "Market Value
per Share" is required to be made hereunder, the determination
of such amount shall be made by the Committee in such manner
as it deems appropriate.
(22) Member: Each Nonemployee Director who has become a Member
pursuant to Article II and each other individual who has been
selected by the Committee for participation in the Plan and
who has become a Member pursuant to Article II.
(23) Meeting Fees: The fees paid in cash by the Company to or for
the benefit of a Nonemployee Director for attending or
participating in a meeting of the Company's Board of Directors
or a committee thereof, acting as the chair of a committee
thereof, conducting Company business in his capacity as a
director on behalf of the Company at the request of the Board
or the Chairman of the Board outside the United States, or
such other fees paid in cash as may be paid to a Nonemployee
Director from time to time for other services performed in his
capacity as a director of the Company.
(24) Nonemployee Director: Each individual who is a member of the
Board of Directors of the Company and who is not employed by
the Employer or any Subsidiary.
(25) Plan: The Continental Airlines, Inc. Deferred Compensation
Plan, as amended from time to time.
(26) Plan Year: The twelve-consecutive month period commencing
January 1 of each year.
(27) Retirement Date. With respect to each Member who is a
Nonemployee Director, the earlier of (a) the first date upon
which such Member has completed 10 years of service (whether
or not completed consecutively) as a Nonemployee Director or
(b) the date upon which such Member has attained 65 years of
age. With respect to each other Member, the earlier of (i)
the first date upon which such Member has both attained 50
years of age and completed 20 or more years of service for
vesting purposes under the Continental Airlines Retirement
Plan, (ii) the first date upon which such Member has both
attained 55 years of age and completed 10 or more years of
service for vesting purposes under the Continental Airlines
Retirement Plan, or (iii) the date upon which such Member has
attained 65 years of age.
(28) Stay Bonus: The monthly bonus, if any, paid in cash by the
Employer to or for the benefit of a Member pursuant to a Stay
Bonus Agreement between the Company and such Member dated as
of April 14, 1998.
(29) Subsidiary: Any corporation that is a "subsidiary
corporation" of the Company within the meaning of section
424(f) of the Code.
(30) Termination of Service: With respect to each Member who is a
Nonemployee Director, the termination of such Member's service
on the Company's Board of Directors for any reason whatsoever.
With respect to each other Member, the termination of such
Member's employment with the Employer and all Subsidiaries for
any reason whatsoever.
(31) Trust: The trust established under the Trust Agreement.
(32) Trust Agreement: The agreement entered into between the
Employer and the Trustee pursuant to Article X.
(33) Trust Fund: The funds and properties held pursuant to the
provisions of the Trust Agreement, together with all income,
profits, and increments thereto.
(34) Trustee: The trustee or trustees qualified and acting under
the Trust Agreement at any time.
(35) Unforeseeable Financial Emergency: An unexpected need of a
Member for cash that (a) arises from a sudden and unexpected
illness or accident of the Member or of a dependent of a
Member, loss of the Member's property due to casualty, or
similar extraordinary and unforeseeable circumstances arising
as a result of events beyond the control of such Member and
(b) would result in severe financial hardship to such Member
if his Compensation deferral election was not canceled
pursuant to Section 3.1(c) and/or if a benefit payment
pursuant to Section 6.2 or 7.5(b)(ii) was not permitted. Cash
needs arising from foreseeable events, such as the purchase of
a house or education expenses for children, shall not be
considered to be the result of an Unforeseeable Financial
Emergency. Further, cash needs that may be relieved (i)
through reimbursement or compensation by insurance or
otherwise, (ii) by liquidation of the Member's assets, to the
extent the liquidation of such assets would not itself cause
severe financial hardship, or (iii) by cessation of deferrals
under the Plan shall not be considered to be Unforeseeable
Financial Emergencies.
(36) Valuation Dates: The last business day of each calendar
quarter and any other interim Valuation Date determined by the
Committee on a nondiscriminatory basis.
1.2 Number and Gender. Wherever appropriate herein, words
used in the singular shall be considered to include the plural and
words used in the plural shall be considered to include the
singular. The masculine gender, where appearing in the Plan, shall
be deemed to include the feminine gender.
1.3 Headings. The headings of Articles and Sections herein
are included solely for convenience, and if there is any conflict
between such headings and the text of the Plan, the text shall
control.
II.
Participation
2.1 Participation.
(a) Each individual who is a Nonemployee Director as of
an Election Date shall be eligible to become a Member as of such
Election Date. Any such Nonemployee Director may become a Member
on such Election Date by executing and filing with the Committee,
prior to such Election Date, the Compensation deferral election
prescribed by the Committee for the Plan Year beginning on such
date.
(b) Prior to each Election Date, the Committee, in its
sole discretion, shall select and notify those management or highly
compensated employees of the Employer who shall be eligible to
become Members as of such Election Date. Any such eligible
employee may become a Member on such Election Date by executing and
filing with the Committee, prior to such Election Date, the
Compensation deferral election prescribed by the Committee for the
Plan Year beginning on such date.
(c) Subject to the provisions of Section 2.2, a Member
shall remain eligible to defer Compensation hereunder for each Plan
Year following his initial year of participation in the Plan.
2.2 Cessation of Active Participation. Notwithstanding any
provision herein to the contrary, an individual who has become a
Member of the Plan (other than a Member who is a Nonemployee
Director) shall cease to be entitled to defer Compensation
hereunder effective as of any date designated by the Committee.
Any such Committee action shall be communicated to the affected
individual prior to the effective date of such action. Such an
individual may again become entitled to defer Compensation
hereunder beginning on any subsequent Election Date selected by the
Committee in its sole discretion.
2.3 Adopting Entities. It is contemplated that other
corporations may adopt this Plan and thereby become an Employer.
Any such entity, whether or not presently existing, may become a
party hereto by appropriate action of its officers without the need
for approval of its board of directors, the Committee or the Human
Resources Committee; provided, however, that such entity must be a
Subsidiary. The provisions of the Plan shall apply separately and
equally to each Employer and its employees in the same manner as is
expressly provided for the Company and its employees, except that
the power to appoint or otherwise affect the Committee and the
Trustee and the power to amend or terminate the Plan or amend the
Trust Agreement shall be exercised by the Human Resources Committee
alone. Transfer of employment among Employers and Subsidiaries
shall not be considered a termination of employment hereunder. Any
Employer may, by appropriate action of its officers without the
need for approval of its board of directors, the Committee or the
Human Resources Committee, terminate its participation in the Plan.
Moreover, the Human Resources Committee may, in its discretion,
terminate an Employer's Plan participation at any time.
III.
Account Credits and Allocations of Income or Loss
3.1 Member Deferrals.
(a) In accordance with the procedures established from
time to time by the Committee, a Member may elect to defer all or
a portion of his Compensation for a Plan Year; provided, however,
that a Member's election to defer Compensation for a Plan Year
must, in the opinion of the Committee, be reasonably expected to
result in a minimum deferral of $5,000 for such year. Without
limiting the discretion of the Committee to establish the
procedures pursuant to which Members may defer Compensation, the
Committee may, in its discretion, permit a Member to (i) designate
fixed or variable percentages or dollar amounts of his Compensation
to be deferred throughout the Plan Year and (ii) make separate
deferral elections with respect to one or more components of his
Compensation. Compensation for a Plan Year not so deferred by such
election shall be received by such Member in cash. A Member's
election to defer an amount of his Compensation pursuant to this
Section shall be made by executing and delivering to the Committee
a Compensation deferral election in the form prescribed by the
Committee pursuant to which the Member authorizes the Employer to
reduce his Compensation in the elected amount and the Employer, in
consideration thereof, agrees to credit an equal amount to such
Member's Account maintained under the Plan. Compensation deferrals
made by a Member shall be credited to such Member's Account as of
the date upon which the Compensation deferred would have been
received by such Member in cash if he had not elected to defer such
amount pursuant to this Section.
(b) A Member's Compensation deferral election shall
become effective as of the Election Date which is immediately after
the date the election is executed by the Member and delivered to
the Committee. Subject to the provisions of Section 3.1(c), a
Member's Compensation deferral election shall remain in force and
effect for the entire Plan Year to which such election relates;
provided, however, that a Member who is eligible to receive
Executive Bonuses may, in accordance with procedures established
from time to time by the Committee, make a separate deferral
election with respect to the Executive Bonus to be paid to such
Member in each of the second, third, and fourth calendar quarters
of such Plan Year during the calendar month preceding each such
quarter. A Member's Compensation deferral election with respect to
a Plan Year shall apply to Compensation for such year even if such
Compensation is paid after the close of such Plan Year.
(c) In the event that the Committee, upon written
petition of a Member, determines in its sole discretion that such
Member has suffered an Unforeseeable Financial Emergency or that
such Member will, absent termination of such Member's Compensation
deferral election then in effect, suffer an Unforeseeable Financial
Emergency, then such Member's Compensation deferral then in effect,
if any, shall be terminated as soon as administratively practicable
after such determination. A Member whose Compensation deferral
election has been so terminated may again elect to defer a portion
of his Compensation, effective as of any subsequent Election Date,
by executing and delivering to the Employer a new Compensation
deferral election prior to such Election Date.
(d) With respect to Compensation deferred by a Member
for a Plan Year, such Member's Compensation deferral election for
such year shall indicate whether:
(i) 100% of the Compensation deferred under such
election and the net income (or net loss) allocated with
respect thereto are to be deferred until the date of such
Member's Termination of Service; or
(ii) a specified amount of the Compensation deferred
under such election shall be deferred until the earlier of
such Termination of Service or the last day of a Plan Year
specified by such Member in such election (which specified
Plan Year must end no earlier than two years after the last
day of the Plan Year to which the Compensation deferral
election relates), and the balance of the Compensation
deferred under such election and the net income (or net loss)
allocated with respect thereto are to be deferred until such
Termination of Service.
The Committee shall establish a separate subaccount within a
Member's Account for each Plan Year with respect to which such
Member makes an election pursuant to clause (ii) of this Section
3.1(d), and all Compensation deferrals made by such Member for such
Plan Year and the net income (or net loss) allocated with respect
thereto shall be credited (or debited) to such subaccount. The
provisions of Section 6.1 shall apply with respect to each election
by a Member pursuant to clause (ii) of this Section 3.1(d).
3.2 Allocation of Net Income or Loss; Changes in Value Among
Accounts; Company Stock.
(a) As of each Valuation Date, the Committee shall
determine the net income (or net loss) of each Fund for the period
elapsed since the next preceding Valuation Date. The net income
(or net loss) of each Fund since the next preceding Valuation Date
shall be ascertained by the Committee in such manner as it deems
appropriate, provided that such determination shall include any net
increase or net decrease (whether or not realized) in the value of
the assets of each such Fund since the next preceding Valuation
Date (as publicly reported for any Fund that publicly reports its
value or results), and may include an appropriate allocation of
expenses of administering the Fund, the Trust, and the Plan.
(b) For purposes of allocations of net income (or net
loss), each Member's Account (or subaccounts) shall be divided into
subaccounts to reflect such Member's deemed investment designation
in a particular Fund or Funds pursuant to Article IV. As of each
Valuation Date, the net income (or net loss) of each Fund,
separately and respectively, shall be allocated among the
corresponding subaccounts of the Members who had such corresponding
subaccounts on the next preceding Valuation Date, and each such
corresponding subaccount shall be credited with (or debited for)
that portion of such net income (or net loss) that the value of
each such corresponding subaccount on such next preceding Valuation
Date was of the value of all such corresponding subaccounts on such
date; provided, however, that the value of such subaccounts as of
the next preceding Valuation Date shall be reduced by the amount of
any payments debited thereto in accordance with Section 7.6 since
the next preceding Valuation Date.
(c) So long as there is any balance in any Account, such
Account shall continue to receive allocations pursuant to this
Section.
(d) Plan provisions to the contrary notwithstanding, the
provisions of this Section 3.2(d) shall be applicable with respect
to allocations and accounting for deemed investments in the Company
Stock Fund. All amounts that are allocated to a Member's Account
under the Plan and that are to be deemed invested in the Company
Stock Fund shall be deemed to have been used to purchase shares of
Company Stock (including fractional shares). Shares of Company
Stock that have been so deemed to have been purchased for a
Member's Account shall be earmarked for the benefit of such Member.
Any cash dividends that would have been received with respect to
Company Stock earmarked for a Member's Account shall be deemed to
have been used to purchase additional shares of Company Stock
(including fractional shares) as of the date such dividends would
have been received, and such additional shares shall also be
earmarked for the benefit of such Member. Any Company Stock that
would have been received as a result of a stock split or stock
dividend shall be allocated pro rata to the Members' Accounts in
proportion to the respective deemed balances of Company Stock
credited to such Accounts as of the appropriate record date and,
following an allocation of such shares to a Member's Account, such
shares shall be earmarked for the benefit of such Member.
IV.
Deemed Investment of Funds
4.1 Deemed Investment of Accounts.
(a) Each Member shall designate, in accordance with the
procedures established from time to time by the Committee, the
manner in which the amounts allocated to his Account shall be
deemed to be invested from among the Funds made available from time
to time for such purpose by the Committee; provided, however, that,
at all times, one of the Funds that shall be made available for
purposes of this Section 4.1 shall be the Company Stock Fund. Such
Member may designate one of such Funds for the deemed investment of
all such amounts allocated to his Account or he may split the
deemed investment of such amounts allocated to his Account among
such Funds in such increments as the Committee may prescribe. If
a Member fails to make a proper designation, then his Account shall
be deemed to be invested in the Fund or Funds designated by the
Committee from time to time in a uniform and nondiscriminatory
manner.
(b) A Member may change his deemed investment
designation for future deferrals to be allocated to his Account.
Any such change shall be made in accordance with the procedures
established by the Committee, and the frequency of such changes may
be limited by the Committee.
(c) A Member may elect to convert his deemed investment
designation with respect to the amounts already allocated to his
Account. Any such conversion shall be made in accordance with the
procedures established by the Committee, and the frequency of such
conversions may be limited by the Committee. No election of a
conversion designation by an Insider which has the effect of
increasing the total amount allocated to the Company Stock Fund may
be made on a date which is less than six months following (i) the
date of any prior election of a conversion designation by such
Insider which had the effect of decreasing the total amount
allocated to the Company Stock Fund or (ii) the date of any
election by such Insider with respect to any other plan of the
Employer or any subsidiary thereof which had the effect (directly
or indirectly) of making a disposition on behalf of such Insider of
Company Stock. No election of a conversion designation by an
Insider which has the effect of decreasing the total amount
allocated to the Company Stock Fund may be made on a date which is
less than six months following (1) the date of any prior election
of a conversion designation by such Insider which had the effect of
increasing the total amount allocated to the Company Stock Fund or
(2) the date of any election by such Insider with respect to any
other plan of the Employer or any subsidiary thereof which had the
effect (directly or indirectly) of making an acquisition on behalf
of the Insider of Company Stock.
(d) The restrictions contained in the Plan regarding
investment designations, changes, and/or conversions by Insiders
respecting the Company Stock Fund are intended to comply with, and
enable Insiders to rely upon, the exemption provided by Rule 16b-3
under the Exchange Act. Any future amendment to Rule 16b-3 or any
successor rule promulgated by the Securities and Exchange
Commission affecting the investment by Insiders in the Company
Stock Fund shall be incorporated by reference herein and be deemed
to be an amendment to the Plan in order that Insiders shall
continue to be entitled to rely upon the exemption provided by such
rule without any interruption. Notwithstanding the foregoing, the
Committee or the Human Resources Committee may alter the
designation, change and/or conversion restrictions applicable to an
Insider, as set forth in the Plan, as a result of changes in Rule
16b-3 under the Exchange Act.
4.2 Deemed Purchases and Sales of Company Stock. For all
purposes of the Plan, all deemed purchases and sales of shares of
Company Stock shall be deemed to have been made at the Market Value
per Share for the date such purchase or sale was deemed to have
occurred under the provisions of the Plan.
V.
Determination of Vested Interest
Except as otherwise expressly provided in the Plan, a Member
shall have a 100% vested and nonforfeitable interest in his Account
at all times.
VI.
In-Service Distributions
6.1 Distribution of Certain Compensation Deferrals. With
respect to each election made by a Member pursuant to Section
3.1(d)(ii), as soon as administratively practicable after the last
day of the Plan Year specified by such Member in such election,
such Member shall receive a distribution in a single lump sum
payment in an amount equal to the lesser of (a) the amount of the
distribution such Member elected to receive on such specified date
pursuant to such election or (b) the value as of such specified
date of the subaccount within such Member's Account that was
established by the Committee in connection with such election. If
a Member's Account is deemed to be invested in more than one Fund,
such benefit shall be distributed pro rata from each Fund in which
such Account is deemed to be invested.
6.2 Emergency Benefit. In the event that the Committee, upon
written petition of a Member, determines in its sole discretion
that such Member has suffered an Unforeseeable Financial Emergency,
such Member shall be entitled to a distribution in an amount not to
exceed the lesser of (a) the amount determined by the Committee as
necessary to meet such Member's needs created by the Unforeseeable
Financial Emergency or (b) the then value of such Member's Account.
Such benefit shall be paid in a single lump sum payment as soon as
administratively practicable after the Committee has made its
determinations with respect to the availability and amount of such
benefit. If a Member's Account is deemed to be invested in more
than one Fund, such benefit shall be distributed pro rata from each
Fund in which such Account is deemed to be invested. If a Member's
Account contains one or more deferral elections pursuant to Section
3.1(d)(ii), such benefit shall be considered to have been
distributed, first, from the deferral amount with respect to which
the earliest distribution would be made pursuant to Section 6.1,
then, from the deferral amount with respect to which the next
earliest distribution would be made pursuant to Section 6.1, and
continuing in such manner until the amount of such distribution has
been satisfied.
6.3 Elective Withdrawal.
(a) A Member may elect at any time, by following the
election procedure prescribed by the Committee, to withdraw as a
benefit all or a portion of his Account as of any Valuation Date,
subject to a withdrawal penalty of 10% of the amount of any such
withdrawal. Upon any such withdrawal, the withdrawal penalty
referred to in the preceding sentence shall be forfeited to the
Employer. Further, upon any such withdrawal, such Member's
participation in the Plan shall terminate and no further
Compensation deferrals shall be made under the Plan on behalf of
such Member until the first day of the Plan Year that is at least
12 months after the date of such withdrawal. If a Member's Account
is deemed to be invested in more than one Fund, such withdrawal
shall be distributed pro rata from each Fund in which such Account
is deemed to be invested. If a Member's Account contains one or
more deferral elections pursuant to Section 3.1(d)(ii), such
withdrawal shall be considered to have been distributed, first,
from the deferral amount with respect to which the earliest
distribution would be made pursuant to Section 6.1, then, from the
deferral amount with respect to which the next earliest
distribution would be made pursuant to Section 6.1, and continuing
in such manner until the amount of such withdrawal (including the
withdrawal penalty) has been satisfied.
(b) No election of a withdrawal of an amount allocated
to the Company Stock Fund may be made by an Insider on a date which
is less than six months following (i) the date of any prior
election to convert such Insider's deemed investment designation
which had the effect of increasing the total amount allocated to
the Company Stock Fund or (ii) the date of any election by such
Insider with respect to any other plan of the Employer or any
subsidiary thereof which had the effect (directly or indirectly) of
making an acquisition on behalf of such Insider of Company Stock.
6.4 Restriction on In-Service Distributions. This Article
VI shall not be applicable to a Member following his Termination of
Service, and the amounts credited to such Member's Account shall be
payable to such Member in accordance with the provisions of Article
VII.
VII.
Termination Benefits
7.1 Amount of Benefit. Upon a Member's Termination of
Service, the Member, or, in the event of the death of the Member
while employed by the Employer or a Subsidiary (or while serving on
the Company's Board of Directors in the case of a Nonemployee
Director), the Member's designated beneficiary, shall be entitled
to a benefit equal in value to the balance in the Member's Account
as of the Valuation Date next preceding the date the payment of
such benefit is to commence pursuant to Section 7.2.
7.2 Time of Payment. Payment of a Member's benefit under
Section 7.1 shall commence as soon as administratively practicable
after the Valuation Date coincident with or next succeeding the
date of the Member's Termination of Service; provided, however,
that, in a written election on the form prescribed by the
Committee, a Member may elect at the time specified in Section
7.3(c) to defer the commencement of the payment of his benefit in
the event of his Termination of Service prior to his Retirement
Date by reason of Disability to the Valuation Date coincident with
or next succeeding the earlier of (a) the date of such Member's
death or (b) the date such Member attains age 65.
7.3 Alternative Forms of Benefit Payments.
(a) A Member's benefit under Section 7.1 shall be paid
in the form of a single lump sum payment if such Member's
Termination of Service occurs prior to his Retirement Date for a
reason other than Disability.
(b) With respect to a Member whose Termination of
Service occurs (i) prior to his Retirement Date by reason of
Disability or (ii) on or after his Retirement Date, such Member
shall receive his benefit payments in one of the following forms
elected by such Member in writing on the form prescribed by the
Committee at the time specified in Section 7.3(c):
(1) A single lump sum payment; or
(2) Annual installment payments for a period of
from two to 20 years as designated by such Member; provided,
however, that in the event of such Member's death prior to the
end of such period, the remaining balance in such Member's
Account shall be paid as soon as administratively feasible in
one lump sum payment to such Member's designated beneficiary
as provided in Section 7.4. The amount of each annual
installment shall be computed by dividing the unpaid balance
in the Member's Account as of the Valuation Date next
preceding the date of payment of such annual installment by
the number of annual installments remaining.
A separate election shall be made pursuant to this Section 7.3(b)
by each Member with respect to the form of distribution to be made
in connection with a Termination of Service that occurs (A) prior
to such Member's Retirement Date by reason of Disability or (B) on
or after such Member's Retirement Date. In the event such Member
fails to timely elect in accordance with Section 7.3(c) the form in
which his benefit payments are to be made, such benefit payments
shall be in the form of a single lump sum payment.
(c) A Member's elections pursuant to Sections 7.2 and
7.3(b) shall be made on or before the date he first becomes a
Member of the Plan. Notwithstanding the foregoing, subject to the
consent of the Committee in its sole discretion, a Member may, on
the form prescribed by the Committee, make one change to each of
his original elections made pursuant to Sections 7.2 and 7.3(b);
provided, however, that (i) upon making any such change, the
aggregate balance in such Member's Account as of the Valuation Date
coincident with or next succeeding such change shall be reduced by
5% and such amount shall be forfeited to the Employer and (ii) such
change shall not be effective (but the penalty described in clause
(i) of this sentence shall still apply) if such Member incurs a
Termination of Service on or before the date that is two years
after such Member delivers the form implementing such change to the
Committee.
7.4 Designation of Beneficiaries.
(a) Each Member shall have the right to designate the
beneficiary or beneficiaries to receive payment of his benefit in
the event of his death. Each such designation shall be made by
executing the beneficiary designation form prescribed by the
Committee and filing same with the Committee. Any such designation
may be changed at any time by execution of a new designation in
accordance with this Section.
(b) If no such designation is on file with the Committee
at the time of the death of the Member or such designation is not
effective for any reason as determined by the Committee, then the
designated beneficiary or beneficiaries to receive such benefit
shall be as follows:
(i) If a Member leaves a surviving spouse, his
benefit shall be paid to such surviving spouse;
(ii) If a Member leaves no surviving spouse, his
benefit shall be paid to such Member's executor or
administrator, or to his heirs at law if there is no
administration of such Member's estate.
7.5 Accelerated Pay-Out of Certain Benefits.
(a) Notwithstanding any provision in Section 7.3(b) to
the contrary, if a Member's benefit payments are to be paid in a
form other than a single lump sum payment and the aggregate amount
to be paid to such Member in any particular calendar year is less
than $10,000, then the Committee may, in its sole discretion, elect
to cause the remaining balance in such Member's Account to be paid
in a single lump sum payment.
(b) If a Member incurs a Termination of Service and such
Member's benefit payments are being, or are to be, paid in a form
other than a single lump sum payment, then:
(i) Such Member may elect at any time, by following
the election procedure prescribed by the Committee, to receive
the remaining balance in his Account (reduced by the 10%
penalty described in the following sentence) in a single lump
sum payment as soon as administratively feasible after the
Valuation Date coincident with or next succeeding the date
such Member delivers to the Committee the form prescribed by
the Committee requesting such distribution. Upon such a
request, the aggregate balance in such Member's Account as of
such Valuation Date shall be reduced by 10% and such amount
shall be forfeited to the Employer; and
(ii) In the event that the Committee, upon
written petition of such Member, determines in its sole
discretion that such Member has suffered an Unforeseeable
Financial Emergency, such Member shall be entitled to an
emergency benefit in an amount and under conditions similar to
those described in Section 6.2.
7.6 Payment of Benefits. To the extent the Trust Fund has
sufficient assets, the Trustee shall pay benefits to Members or
their beneficiaries, except to the extent the Employer pays the
benefits directly and provides adequate evidence of such payment to
the Trustee. To the extent the Trustee does not or cannot pay
benefits out of the Trust Fund, the benefits shall be paid by the
Employer. Any benefit payments made to a Member or for his benefit
pursuant to any provision of the Plan shall be debited to such
Member's Account. All benefit payments shall be made in cash to
the fullest extent practicable.
7.7 Unclaimed Benefits. In the case of a benefit payable on
behalf of a Member, if the Committee is unable, after reasonable
efforts, to locate the Member or beneficiary to whom such benefit
is payable, upon the Committee's determination thereof, such
benefit shall be forfeited to the Employer. Notwithstanding the
foregoing, if subsequent to any such forfeiture the Member or
beneficiary to whom such benefit is payable makes a valid claim for
such benefit, such forfeited benefit (without any adjustment for
earnings or loss) shall be restored to the Plan by the Employer and
paid in accordance with the Plan.
VIII.
Administration of the Plan
8.1 Appointment of Committee. The general administration of
the Plan shall be vested in the Committee which shall be appointed
by the Human Resources Committee and shall consist of one or more
persons. Any individual, whether or not an employee of the
Employer, is eligible to become a member of the Committee.
8.2 Term, Vacancies, Resignation, and Removal. Each member
of the Committee shall serve until he resigns, dies, or is removed
by the Human Resources Committee. At any time during his term of
office, a member of the Committee may resign by giving written
notice to the Human Resources Committee and the Committee, such
resignation to become effective upon the appointment of a
substitute member or, if earlier, the lapse of thirty days after
such notice is given as herein provided. At any time during his
term of office, and for any reason, a member of the Committee may
be removed by the Human Resources Committee with or without cause,
and the Human Resources Committee may in its discretion fill any
vacancy that may result therefrom. Any member of the Committee who
is an employee of the Employer shall automatically cease to be a
member of the Committee as of the date he ceases to be employed by
the Employer or any Subsidiary.
8.3 Self-Interest of Members. No member of the Committee
shall have any right to vote or decide upon any matter relating
solely to himself under the Plan or to vote in any case in which
his individual right to claim any benefit under the Plan is
particularly involved. In any case in which a Committee member is
so disqualified to act and the remaining members cannot agree, the
Human Resources Committee shall appoint a temporary substitute
member to exercise all the powers of the disqualified member
concerning the matter in which he is disqualified.
8.4 Committee Powers and Duties. The Committee shall
supervise the administration and enforcement of the Plan according
to the terms and provisions hereof and shall have all powers
necessary to accomplish these purposes, including, but not by way
of limitation, the right, power, and authority:
(a) To make rules, regulations, and bylaws for the
administration of the Plan that are not inconsistent with the
terms and provisions hereof, and to enforce the terms of the
Plan and the rules and regulations promulgated thereunder by
the Committee;
(b) To construe in its discretion all terms, provisions,
conditions, and limitations of the Plan;
(c) To correct any defect or to supply any omission or
to reconcile any inconsistency that may appear in the Plan in
such manner and to such extent as it shall deem in its
discretion expedient to effectuate the purposes of the Plan;
(d) To employ and compensate such accountants,
attorneys, investment advisors, and other agents, employees,
and independent contractors as the Committee may deem
necessary or advisable for the proper and efficient
administration of the Plan;
(e) To determine in its discretion all questions
relating to eligibility;
(f) To determine whether and when a Member has incurred
a Termination of Service, and the reason for such termination;
(g) To make a determination in its discretion as to the
right of any person to a benefit under the Plan and to
prescribe procedures to be followed by distributees in
obtaining benefits hereunder;
(h) To receive and review reports from the Trustee as to
the financial condition of the Trust Fund, including its
receipts and disbursements; and
(i) To establish or designate Funds as investment
options as provided in Article IV.
8.5 Claims Review. In any case in which a claim for Plan
benefits of a Member or beneficiary is denied or modified, the
Committee shall furnish written notice to the claimant within 90
days (or within 180 days if additional information requested by the
Committee necessitates an extension of the 90-day period), which
notice shall:
(a) State the specific reason or reasons for the denial
or modification;
(b) Provide specific reference to pertinent Plan
provisions on which the denial or modification is based;
(c) Provide a description of any additional material or
information necessary for the Member, his beneficiary, or
representative to perfect the claim and an explanation of why
such material or information is necessary; and
(d) Explain the Plan's claim review procedure as
contained herein.
In the event a claim for Plan benefits is denied or modified, if
the Member, his beneficiary, or a representative of such Member or
beneficiary desires to have such denial or modification reviewed,
he must, within 60 days following receipt of the notice of such
denial or modification, submit a written request for review by the
Committee of its initial decision. In connection with such
request, the Member, his beneficiary, or the representative of such
Member or beneficiary may review any pertinent documents upon which
such denial or modification was based and may submit issues and
comments in writing. Within 60 days following such request for
review the Committee shall, after providing a full and fair review,
render its final decision in writing to the Member, his beneficiary
or the representative of such Member or beneficiary stating
specific reasons for such decision and making specific references
to pertinent Plan provisions upon which the decision is based. If
special circumstances require an extension of such 60-day period,
the Committee's decision shall be rendered as soon as possible, but
not later than 120 days after receipt of the request for review.
If an extension of time for review is required, written notice of
the extension shall be furnished to the Member, beneficiary, or the
representative of such Member or beneficiary prior to the
commencement of the extension period.
8.6 Dispute Resolution; Mandatory Arbitration.
(La) If a Member or beneficiary is not satisfied with the
decision of the Committee pursuant to the Plan's claims review
procedure, then such Member or beneficiary may, within 180 days of
receipt of the written decision of the Committee, request by
written notice to the Committee that his claim be submitted to
arbitration pursuant to the procedures set forth in this Section.
In such event, all claims, demands, causes of action, disputes,
controversies, and other matters in question arising out of or
relating to the Plan, any provision hereof, the alleged breach
thereof, or in any way relating to the subject matter of the Plan,
involving the Employer, such Member or beneficiary, and/or their
respective representatives, even though some or all of such claims
allegedly are extra-contractual in nature, whether such claims
sound in contract, tort, or otherwise, at law or in equity, under
state or federal law, whether provided by statute or the common
law, for damages or any other relief, shall be resolved by binding
arbitration pursuant to the Federal Arbitration Act in accordance
with the Commercial Arbitration Rules then in effect with the
American Arbitration Association; provided, however, that the
arbitrators shall use the standard of review which would be used by
a federal court in reviewing a decision of the Committee under the
provisions of the Employee Retirement Income Security Act of 1974.
The arbitration proceeding shall be conducted in Houston, Texas.
This requirement to arbitrate shall be enforceable in either
federal or state court.
(b) The enforcement of this requirement to arbitrate and
all procedural aspects of the arbitration, including but not
limited to, the construction and interpretation of this Section,
the issues subject to arbitration (i.e., arbitrability), the scope
of the arbitrable issues, allegations of waiver, delay or defenses
to arbitrability, and the rules governing the conduct of the
arbitration, shall be governed by and construed pursuant to the
Federal Arbitration Act and shall be decided by the arbitrators.
In deciding the substance of any such claims, the arbitrators shall
apply the substantive laws of the State of Texas (excluding Texas
choice-of-law principles that might call for the application of
some other state's law); provided, however, it is expressly
provided that the arbitrators shall have no authority to award
treble, exemplary, or punitive damages under any circumstances
regardless of whether such damages may be available under Texas
law.
(c) Within 30 days after notice to the Committee
pursuant to Section 8.6(a) to have a claim resolved by arbitration,
(i) the Member or beneficiary, as applicable, shall denominate one
arbitrator and (ii) the Company shall denominate one arbitrator.
The two arbitrators shall select a third arbitrator failing
agreement on which within 60 days of the original notice, either
the Company or the Member or beneficiary, as applicable, shall
apply to the Senior Active United States District Judge for the
Southern District of Texas, who shall appoint a third arbitrator.
While the third arbitrator shall be neutral, the two party-
appointed arbitrators are not required to be neutral and it shall
not be grounds for removal of either of the two party-appointed
arbitrators or for vacating the arbitrators' award that either of
such arbitrators has past or present minimal relationships with the
party that appointed such arbitrator. Evident partiality on the
part of an arbitrator exists only where the circumstances are such
that a reasonable person would have to conclude there in fact
existed actual bias and a mere appearance or impression of bias
will not constitute evident partiality or otherwise disqualify an
arbitrator.
(d) The three arbitrators shall by majority vote resolve
all disputes between the parties. There shall be no transcript of
the hearing before the arbitrators. The arbitrators' decision
shall be in writing, but shall be as brief as possible. The
arbitrators shall not assign the reasons for their decision. The
arbitrators shall certify in their award that they have faithfully
applied the terms and conditions of the Plan and that no part of
their award includes any amount for treble, exemplary or punitive
damages. Judgment upon any award rendered in any such arbitration
proceeding may be entered by any federal or state court having
jurisdiction.
(e) The Member or beneficiary and the Employer shall
share equally the costs and expenses of the arbitrators. Each
party to an arbitration proceeding shall be responsible for its own
costs and expenses, including its own attorneys' fees.
Notwithstanding the preceding provisions of this Section 8.6(e),
if, following a Change in Control, a Member or beneficiary shall
obtain any money judgment in an arbitration brought by such Member
or beneficiary pursuant to this Section, which money judgment is in
excess of the amount determined as owed to such Member or
beneficiary by the Committee pursuant to the Plan's claims review
procedure, then the Employer, to the fullest extent permitted by
applicable law, shall indemnify such Member or beneficiary for his
share of the costs and expenses of the arbitrators and such
Member's or beneficiary's reasonable attorneys' fees and
disbursements incurred in such arbitration, and the Employer shall
pay in full all such costs, expenses, fees, and disbursements.
8.7 Employer to Supply Information. The Employer shall
supply full and timely information to the Committee, including, but
not limited to, information relating to each Member's Compensation,
age, retirement, death, Disability, or other cause of Termination
of Service and such other pertinent facts as the Committee may
require. The Employer shall advise the Trustee of such of the
foregoing facts as are deemed necessary for the Trustee to carry
out the Trustee's duties under the Plan and the Trust Agreement.
When making a determination in connection with the Plan, the
Committee shall be entitled to rely upon the aforesaid information
furnished by the Employer.
8.8 Indemnity. To the extent permitted by applicable law,
the Company shall indemnify and save harmless each member of the
Committee and the Human Resources Committee against any and all
expenses, liabilities and claims (including legal fees incurred to
investigate or defend against such liabilities and claims) arising
out of their discharge in good faith of responsibilities under or
incident to the Plan. Expenses and liabilities arising out of
willful misconduct shall not be covered under this indemnity. This
indemnity shall not preclude such further indemnities as may be
available under insurance purchased by the Company or provided by
the Company under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, as such indemnities are
permitted under applicable law.
8.9 Change in Control. Notwithstanding any provision in the
Plan to the contrary, upon the occurrence of a Change in Control,
the Committee's powers and duties under the Plan shall cease to the
extent, if any, such powers and duties are vested in the Trustee
under the terms of the Trust Agreement.
IX.
Administration of Funds
9.1 Payment of Expenses. All expenses incident to the
administration of the Plan and Trust, including but not limited to,
legal, accounting, Trustee fees, and expenses of the Committee, may
be paid by the Employer and, if not paid by the Employer, shall be
paid by the Trustee from the Trust Fund.
9.2 Trust Fund Property. All income, profits, recoveries,
contributions, forfeitures and any and all moneys, securities and
properties of any kind at any time received or held by the Trustee
shall be held for investment purposes as a commingled Trust Fund
pursuant to the terms of the Trust Agreement. The Committee shall
maintain one or more Accounts in the name of each Member, but the
maintenance of an Account designated as the Account of a Member
shall not mean that such Member shall have a greater or lesser
interest than that due him by operation of the Plan and shall not
be considered as segregating any funds or property from any other
funds or property contained in the commingled fund. No Member
shall have any title to any specific asset in the Trust Fund.
9.3 Contributions to the Trust Fund. As soon as
administratively practicable after each date upon which an amount
is credited to a Member's Account pursuant to Section 3.1, the
Employer shall contribute an equivalent amount to the Trust Fund.
9.4 Investment of the Trust Fund. The Committee shall have
the right, power, authority, and duty to instruct the Trustee as to
the management, investment, and reinvestment of the Trust Fund.
X.
Nature of the Plan
The Employer intends and desires by the adoption of the Plan
to recognize the value to the Employer of the past and present
services of Nonemployee Directors and employees covered by the Plan
and to encourage and assure their continued service with the
Employer by making more adequate provision for their future
retirement security. The establishment of the Plan is made
necessary by certain benefit limitations which are imposed on the
Employer's tax-qualified plans by the Employee Retirement Income
Security Act of 1974 and by the Code. The Plan is intended to
constitute an unfunded, unsecured plan of deferred compensation for
Nonemployee Directors and a select group of management or highly
compensated employees of the Employer. Plan benefits herein
provided are a contractual obligation of the Employer which shall
be paid out of the Trust Fund or out of the Employer's general
assets. Subject to the terms hereof and of the Trust Agreement,
the Employer shall transfer money or other property to the Trustee
to provide Plan benefits hereunder, and the Trustee shall pay Plan
benefits to Members and their beneficiaries out of the Trust Fund.
The Employer shall establish the Trust and enter into the
Trust Agreement. The Employer shall remain the owner of all assets
in the Trust Fund and the assets shall be subject to the claims of
the Employer's creditors if the Employer ever becomes insolvent.
For purposes hereof, the Employer shall be considered "insolvent"
if (a) the Employer is unable to pay its debts as they become due
or (b) the Employer is subject to a pending proceeding as a debtor
under the United Sates Bankruptcy Code (or any successor federal
statute). The chief executive officer of the Employer and its
board of directors shall have the duty to inform the Trustee in
writing if the Employer becomes insolvent. Such notice given under
the preceding sentence by any party shall satisfy all of the
parties' duty to give notice. When so informed, the Trustee shall
suspend payments to the Members and hold the assets for the benefit
of the Employer's general creditors. If the Trustee receives a
written allegation that the Employer is insolvent, the Trustee
shall suspend payments to the Members and hold the Trust Fund for
the benefit of the Employer's general creditors, and shall
determine within the period specified in the Trust Agreement
whether the Employer is insolvent. If the Trustee determines that
the Employer is not insolvent, the Trustee shall resume payments to
the Members. No Member or beneficiary shall have any preferred
claim to, or any beneficial ownership interest in, any assets of
the Trust Fund, and, upon commencement of participation in the
Plan, each Member shall have agreed to waive his priority credit
position, if any, under applicable state law with respect to the
assets of the Trust Fund.
XI.
Miscellaneous
11.1 Not Contract of Employment. The adoption and maintenance
of the Plan shall not be deemed to be a contract between the
Employer and any person or to be consideration for the employment
of or service as a director by any person. Nothing herein
contained shall be deemed to (a) give any person the right to be
nominated to the Company's Board of Directors to serve as a
director or to be retained in the employ of the Employer, (b)
restrict the right of the Employer to discharge any person at any
time, (c) give the Employer the right to require any person to
remain in the employ of the Employer or continue service as a
director, or (d) restrict any person's right to terminate his
employment or service as a director at any time.
11.2 Alienation of Interest Forbidden. The interest of a
Member or his beneficiary or beneficiaries hereunder may not be
sold, transferred, assigned, or encumbered in any manner, either
voluntarily or involuntarily, and any attempt so to anticipate,
alienate, sell, transfer, assign, pledge, encumber, or charge the
same shall be null and void; neither shall the benefits hereunder
be liable for or subject to the debts, contracts, liabilities,
engagements or torts of any person to whom such benefits or funds
are payable, nor shall they be an asset in bankruptcy or subject to
garnishment, attachment or other legal or equitable proceedings.
11.3 Withholding. All Compensation deferrals and payments
provided for hereunder shall be subject to applicable withholding
and other deductions as shall be required of the Employer under any
applicable local, state or federal law.
11.4 Amendment and Termination. The Human Resources Committee
may from time to time, in its discretion, amend, in whole or in
part, any or all of the provisions of the Plan; provided, however,
that no amendment may be made that would impair the rights of a
Member with respect to amounts already allocated to his Account.
The Human Resources Committee may terminate the Plan at any time.
In the event that the Plan is terminated, the balance in a Member's
Account shall be paid to such Member or his designated beneficiary
in the manner specified by the Committee, which may include the
payment of a single lump sum payment in full satisfaction of all of
such Member's or beneficiary's benefits hereunder.
11.5 Severability. If any provision of this Plan shall be
held illegal or invalid for any reason, said illegality or
invalidity shall not affect the remaining provisions hereof;
instead, each provision shall be fully severable and the Plan shall
be construed and enforced as if said illegal or invalid provision
had never been included herein.
11.6 Guaranty. Notwithstanding any provisions of the Plan to
the contrary, in the event any Subsidiary that adopts the Plan
pursuant to Section 2.3 hereof fails to make payment of the
benefits due under the Plan on behalf of its Members, whether
directly or through the Trust, the Company shall be liable for and
shall make payment of such benefits due as a guarantor of such
entity's obligations hereunder. The guaranty obligations provided
herein shall be satisfied directly and not through the Trust.
11.7 Governing Laws. All provisions of the Plan shall be
construed in accordance with the laws of Texas except to the extent
preempted by federal law.
EXECUTED this 1st day of December, 1998.
CONTINENTAL AIRLINES, INC.
By:
Jeffery A. Smisek
Executive Vice President
Exhibit 4.4
CONTINENTAL AIRLINES, INC.
DEFERRED COMPENSATION PLAN TRUST AGREEMENT
TABLE OF CONTENTS
ARTICLE I : GENERAL TRUST PROVISIONS . . . . . . . . I-1
ARTICLE II : GENERAL DUTIES OF THE PARTIES . . . . . . II-1
ARTICLE III : INVESTMENT, ADMINISTRATION AND
DISBURSEMENT OF TRUST FUND . . . . . . . III-1
ARTICLE IV : SETTLEMENT OF ACCOUNTS . . . . . . . . . IV-1
ARTICLE V : TAXES, EXPENSES AND COMPENSATION
OF TRUSTEE . . . . . . . . . . . . . . . V-1
ARTICLE VI : FOR PROTECTION OF TRUSTEE . . . . . . . . VI-1
ARTICLE VII : INDEMNITY OF TRUSTEE . . . . . . . . . . VII-1
ARTICLE VIII : RESIGNATION AND REMOVAL OF TRUSTEE . . . VIII-1
ARTICLE IX : DURATION AND TERMINATION OF
TRUST AND AMENDMENT . . . . . . . . . . . IX-1
ARTICLE X : CLAIMS OF COMPANY'S CREDITORS . . . . . . X-1
ARTICLE XI : ADOPTING ENTITIES . . . . . . . . . . . . XI-1
ARTICLE XII : MISCELLANEOUS . . . . . . . . . . . . . . XII-1
CONTINENTAL AIRLINES, INC.
DEFERRED COMPENSATION PLAN TRUST AGREEMENT
THIS AGREEMENT AND DECLARATION OF TRUST, made this day
of , 1998, by and between (i)
CONTINENTAL AIRLINES, INC. (hereinafter referred to as the
"Company") and (ii)
(hereinafter referred to as the "Trustee").
WHEREAS, the Company has established the CONTINENTAL AIRLINES,
INC. DEFERRED COMPENSATION PLAN (hereinafter referred to as the
"Plan") for the benefit of certain individuals who are eligible for
benefits under the terms of the Plan (such individuals being
referred to herein as the "Members"), which Plan provides for the
payment of certain deferred compensation benefits (the "Benefits")
to the Members and the beneficiaries of the respective Members who
may become entitled to any payments under the terms of the Plan in
the event of the Member's death ("Beneficiaries"); and
WHEREAS, the Plan contemplates that the Company will pay the
entire cost of the Benefits from its general assets; and
WHEREAS, the Company desires to adopt the CONTINENTAL
AIRLINES, INC. DEFERRED COMPENSATION PLAN TRUST AGREEMENT (the
"Trust Agreement") establishing a trust (the "Trust") to aid the
Company in meeting its obligations under the Plan; and
WHEREAS, the Trust is intended to be a "grantor trust" with
the corpus and income of the Trust treated as assets and income of
the Company for federal income tax purposes; and
WHEREAS, the Company intends that the assets of the Trust
shall at all times be subject to the claims of general creditors of
the Company as provided in Article X; and
WHEREAS, the Company intends that the existence of the Trust
shall not alter the characterization of the Plan as "unfunded"
for purposes of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), and shall not be construed to provide
income to any Member prior to actual payment of Benefits under the
Plan; and
WHEREAS, other adopting entities have adopted the Plan and
other adopting entities may adopt the Plan in the future, and the
Company desires to permit such entities to adopt separate subtrusts
hereunder that are substantially similar to the Trust; and
WHEREAS, under the Trust, the Trustee covenants that it will
hold all property which it may receive hereunder, IN TRUST, for the
uses and purposes and upon the terms and conditions hereinafter
stated;
NOW, THEREFORE, the parties hereto establish the Trust,
effective January 1, 1999, and agree, as follows:
ARTICLE I
General Trust Provisions
1.1 Establishment of Trust. The Company hereby adopts this
Trust Agreement. The Trust shall consist of such sums of money and
other property acceptable to the Trustee as from time to time shall
be paid or delivered to the Trustee by the Company. All such money
and other property, all investments and reinvestments made
therewith or proceeds thereof and all earnings and profits thereon,
less all payments and charges as authorized herein, shall
constitute the "Trust Fund." The Trust Fund shall at all times be
subject to the claims of general creditors of the Company as
provided in Article X. No Member or Beneficiary shall have any
preferred claim to, or any beneficial ownership interest in, any
assets of the Trust Fund prior to the time such assets are paid to
such Member or Beneficiary as Benefits.
1.2 Separate Sub-Trusts. Contrary provisions of the Trust
notwithstanding, except as provided in Article XI, the provisions
of the Trust shall apply separately and equally to the Company and
to each adopting entity that has entered into this Trust Agreement
pursuant to Article XI. The Company and each such adopting entity
shall bear the cost of providing Benefits for its own Members and
their Beneficiaries, and the portion of the Trust Fund attributable
to the contributions of the Company and each such adopting entity
shall be available to provide benefits only to the Company's or
such adopting entity's (as applicable) Members and their
Beneficiaries or to satisfy claims of the Company's or such
adopting entity's (as applicable) Bankruptcy Creditors in the event
the Company or such adopting entity (as applicable) become
Insolvent (as such terms are defined in Section 10.1).
1.3 Trust Irrevocable. The Trust shall be irrevocable and
shall be held for the exclusive purpose of providing benefits under
the Plan to Members and their Beneficiaries and defraying expenses
of the Trust in accordance with the provisions of this Trust
Agreement. Except as provided in Sections 3.6(c) and 3.6(d) and
Articles IX and X hereof, no part of the income or corpus of the
Trust Fund shall be recoverable by or for the Company.
1.4 Non-Alienation. No right or interest to receive
benefits from the Trust may be assigned, sold, anticipated,
alienated or otherwise transferred by any Member or Beneficiary.
1.5 Acceptance by Trustee. The Trustee accepts the Trust
established under this Trust Agreement on the terms and subject to
the provisions set forth herein, and it agrees to discharge and
perform fully and faithfully all of the duties and obligations
imposed upon it under this Trust Agreement.
ARTICLE II
General Duties of the Parties
2.1 General Duties of the Company and the Trustee.
(a) The Company has provided or will provide the
Trustee with a copy of the Plan and shall provide the Trustee with
a copy of any amendment to the Plan promptly upon its adoption.
The Plan, as of the date of execution of this Trust Agreement, is
hereby incorporated by reference into and shall form a part of this
Trust Agreement as fully as if set forth herein verbatim. Any
amendment to the Plan shall also be incorporated by reference into
and form a part of this Trust Agreement, effective as of the
effective date of such amendment. As soon as administratively
practicable after December 31, 1999, the Company shall prepare and
deliver to the Trustee a schedule (the "Benefits Schedule," as
amended from time to time as provided herein) setting forth as of
such date (1) the name and mailing address of each Member entitled
to receive Benefits, (2) the Beneficiaries, if any, designated by
each Member, and (3) the aggregate balance of each Member's Account
(as such term is defined in the Plan) and subaccount thereof. The
Company shall be responsible for notifying the Trustee of any
changes in the information set forth on the Benefit Schedule,
including, but not limited to, the addition of new Members and a
change in the mailing address of a Member.
(b) Subject to the provisions of Section 2.1(c), the
Trustee shall keep the Benefit Schedule accurate and current,
including but not limited to, preparing by March 31 of each year
(beginning in the year 2001) a completely updated Benefit Schedule
as of the preceding December 31 with such assistance from the
Company and independent third parties as may be necessary in order
to permit distributions from the Trust Fund to be made in
accordance with the provisions of Section 3.6. The Company shall
keep accurate books and records with respect to the eligibility of
individuals to participate in the Plan and the Benefits payable
under the Plan, and shall provide such information to the Trustee
and any independent third party referred to in the immediately
preceding sentence and shall also provide access to such books and
records at such time or times as the Trustee shall reasonably
request.
(c) If, at any time, the Company fails or refuses to
give the Trustee data or access to such books and records in
accordance with Section 2.1(b), the Trustee shall deliver a written
request to the Company to provide access to books and records of
the Company and to provide such data as required in accordance with
Section 2.1(b) for the Trustee to keep the Benefit Schedule
accurate and current. If the Company fails or refuses to comply
with the Trustee's written request pursuant to the preceding
sentence prior to the expiration of thirty days from the date of
delivery thereof by the Trustee, the Trustee shall, after ten days
written notice to the Company, immediately pay to each Member an
amount equal to such Member's aggregate account balance ("Account
Balance") as set forth on the most recent Benefit Schedule, reduced
by any taxes to be withheld pursuant to Section 3.6. Such payment
shall be made in accordance with the provisions of Section 3.6.
For this purpose, the Company shall be deemed to have complied with
the Trustee's written request if, in the Trustee's judgment, it
shall have substantially complied at the end of the thirty-day
period and is endeavoring in good faith to complete compliance
without delay.
(d) The administrative committee charged with the
general administration of the Plan (the "Committee") shall notify
each Member and Beneficiary of a then deceased Member in writing of
any changes in the Benefit Schedule with respect to such Member or
Beneficiary. The Trustee shall notify all Members and such
Beneficiaries of any failure of the Company to provide information
required in this Section 2.1.
(e) It is intended that Benefits payable to Members
shall be determined under the provisions of the Plan and shall be
calculated under the provisions of the Plan as of the date of
payment. Payment of Benefits shall be based upon the amounts set
forth on the Benefit Schedule only under the circumstances set
forth in Section 2.1(c). If the actual Benefits payable to a
Member under the provisions of the Plan exceeds the amount set
forth on the Benefit Schedule which is paid pursuant to Section
2.1(c), the Company shall be liable for payment of the remaining
portion of such Benefits.
(f) Trust provisions to the contrary notwithstanding,
the Company shall have the right at any time, and from time to
time, in its sole discretion, to substitute marketable securities
of equal fair market value for any asset held by the Trust. This
right is exercisable by the Company in a nonfiduciary capacity
without the approval or consent of any person in a fiduciary
capacity.
(g) As soon as administratively practicable after each
date upon which an amount is credited to a Member's "Account" under
the Plan pursuant to Section 3.1 of the Plan, the Company shall
contribute an equivalent amount to the Trust.
2.2 Additional General Duties of Trustee. The Trustee shall
manage, invest and reinvest the Trust Fund as the Trustee may
determine in the exercise of its fiduciary duties hereunder,
consistent with the provisions of Article III. The Trustee shall
collect the income on the Trust Fund, and make distributions
therefrom, all as hereinafter provided.
ARTICLE III
Investment, Administration and Disbursement of Trust Fund
3.1 Investment of Trust Fund. The following provisions
shall apply with respect to the investment of the Trust Funds:
(a) At any time prior to the occurrence of a Change in
Control (as such term is defined in Section 12.4), the Trustee
shall invest and reinvest the assets of the Trust Fund in
accordance with the written directions received from time to
time by the Trustee from the Committee. Specifically, but not
by way of limitation, the Committee may, in its discretion,
direct the Trustee to follow the deemed investment directions
of each Member or Beneficiary of a deceased Member, whether
written or telephonic, with respect to a portion of the Trust
Fund assets equal in value to the Account Balance maintained
under the Plan on behalf of such individual, within parameters
established by, and as agent for, the Committee;
(b) To the extent that the Trustee is directed by the
Committee, the Trustee may invest in securities (including
stock or rights to acquire stock) or obligations issued by the
Company;
(c) To the extent that the Trustee is directed by the
Committee, the Trustee may establish one or more separate
investment accounts within the Trust Fund, each separate
account being hereinafter referred to as a Fund. Except as
otherwise provided, the Trustee shall transfer to each such
Fund such portion of the assets of the Trust Fund as the
Committee directs. The Trustee shall be under no duty to
question, and shall not incur any liability on account of
following, any direction of the Committee. The Trustee shall
be under no duty to review the investment guidelines,
objectives, and restrictions established, or the specific
investment directions given by the Committee for any Fund, or
to make suggestions to the Committee in connection therewith.
To the extent that directions from the Committee to the
Trustee represent deemed investment elections of the Members,
the Trustee shall have no responsibility for such investment
elections and shall incur no liability on account of investing
the assets of the Trust Fund in accordance with such
directions. All interest, dividends, and other income
received with respect to, and any proceeds received from the
sale or other disposition of securities or other property held
in, a Fund shall be credited to and reinvested in such Fund.
All expenses of the Trust Fund which are allocable to a
particular Fund shall be so allocated and charged. The
Committee may direct the Trustee to eliminate a Fund or Funds,
and the Trustee shall thereupon dispose of the assets of such
Fund and reinvest the proceeds thereof in accordance with the
directions of the Committee; and
(d) From and after the occurrence of a Change in
Control, or if the Committee fails to provide the Trustee with
such written directions, the Trustee shall have, with respect
to the Trust Fund, power in its discretion to invest and
reinvest such assets in (i) common and preferred stocks,
bonds, notes (whether secured or unsecured) and debentures
(including convertible stocks and securities but not including
any stock, debt instruments, or other securities of the
Company, the Trustee or their affiliates) which are readily
marketable and listed on a United States national securities
exchange or the NASDAQ national market, (ii) interest-bearing
deposit accounts or certificates of deposit maturing within
one year after acquisition thereof, entered into or issued by
a United States national or state bank or trust company having
capital, surplus and undivided profits, at the holding company
level, of at least $75 million, (iii) direct obligations of,
and obligations fully guaranteed by, the United States of
America or any agency of the United States of America which is
backed by the full faith and credit of the United States of
America (so long as such obligations shall mature within one
year after acquisition thereof), (iv) any common, collective
or commingled fund, including a fund maintained by the
Trustee, established and maintained primarily for the purpose
of investing and reinvesting in assets of the type described
in (i), (ii) or (iii) above, and (v) insurance contracts
issued by one or more insurance companies. Further,
notwithstanding the provisions of the preceding sentence,
after the occurrence of a Change in Control or in the event
the Committee fails to provide the Trustee with written
directions pursuant to the preceding provisions of this
Section 3.1, the Trustee shall have the power in its
discretion to retain, maintain, continue, sell, or take any
other actions relative to any assets then held in the Trust
Fund (including, without limitation, to take actions in
accordance with investment directions obtained directly from
a Member or Beneficiary of a deceased Member with respect to
a portion of the Trust Fund assets equal in value to the
Account Balance maintained under the Plan on behalf of such
individual).
3.2 Valuation of Trust Fund. As soon as practicable after
the last day of each calendar year and as of such other dates as
may be specified by the Company or the Committee, the Trustee shall
report to the Company and the Committee the assets held in the
Trust Fund as of such day and shall determine and include in such
report the fair market value as of such day of each such asset. In
determining such fair market values, the Trustee shall use such
market quotations and other information as are available to it and
may in its discretion be appropriate. The report of any such
valuation shall not constitute a representation by the Trustee that
the amounts reported as fair market values would actually be
realized upon the liquidation of the Trust Fund. The Trustee shall
not be accountable to the Company or to any other person on the
basis of any such valuation, but its accountability shall be in
accordance with the provisions of Article IV hereof.
3.3 Additional Investment Powers of Trustee. Subject to the
provisions of Sections 3.1, 3.6 and 9.2 hereof, the Trustee shall
have, with respect to the Trust Fund, the power in its discretion:
(a) To retain any property at any time received by it;
(b) To sell, exchange, convey, transfer or dispose of,
and to grant options for the purchase or exchange with respect
to, any property at any time held by it;
(c) To register and carry any securities or any other
property in the name of the Trustee, or in the name of the
nominee of the Trustee (or to hold any such property
unregistered) without increasing or decreasing the fiduciary
liability of the Trustee, and to exercise any option, right or
privilege to convert any convertible securities, including
shares or fractional shares of the Trustee so long as the
conversion privilege is offered pro rata to all shareholders;
(d) To cause any securities to be held in book-entry
or in bearer form;
(e) To hold property for investment that may be
unproductive of income; and
(f) To hold uninvested at any time, without liability
for interest thereon for a reasonable period of time, any
money received by the Trustee until the same shall be
reinvested or disbursed.
3.4 Administrative Powers of Trustee. The Trustee shall
have the power in its discretion:
(a) To exercise all voting and other rights with
respect to the shares of stock held in the Trust Fund and to
grant proxies, discretionary or otherwise; provided, however,
that, prior to the occurrence of a Change in Control, the
Trustee shall exercise all voting and other rights with
respect to stock issued by the Company or its affiliates for,
against or otherwise in the same proportion as all other
shares voted or exercised for, against or otherwise
(b) To cause any shares of stock to be registered and
held in the name of one or more of its nominees, or one or
more nominees of any system for the central handling of
securities, without increase or decrease of liability;
(c) To collect and receive any and all money and other
property due to the Trust Fund and to give full discharge
therefor;
(d) Subject to the provisions of Section 3.6 hereof:
to settle, compromise or submit to arbitration any claims,
debts or damages due or owing to or from the Trustee; to
commence or defend suits or legal proceedings to protect any
interest of the Trust; and to represent the Trust in all suits
or legal proceedings in any court or before any other body or
tribunal;
(e) To organize under the laws of any state a
corporation or limited liability company for the purpose of
acquiring and holding title to any property which it is
authorized to acquire under this Trust Agreement and to
exercise with respect thereto any or all of the powers set
forth in this Trust Agreement;
(f) To determine how all receipts and disbursements
shall be credited, charged or apportioned as between income
and principal;
(g) To determine the amount and time of Benefit
payments in accordance with Section 3.6;
(h) To employ and compensate such attorneys, counsel,
brokers or other agents or employees and to delegate to them
such of the duties, rights and powers of the Trustee as may be
deemed advisable in handling and administering the Trust; and
(i) Generally to do all acts, whether or not expressly
authorized, which the Trustee may deem necessary or desirable
for the protection of the Trust Fund.
3.5 Dealings with Trustee. Persons dealing with the Trustee
shall be under no obligation to see to the proper application of
any money paid or property delivered to the Trustee or to inquire
into the Trustee's authority as to any transaction.
3.6 Distributions from Trust Fund.
(a) Except as set forth in Section 3.6(c), Section
3.6(d), Section 9.2 and Article X hereof, distributions from the
Trust Fund shall be made by the Trustee to the Members and
Beneficiaries at the times and in the amounts determined in
accordance with the provisions of the Plan and, to the maximum
extent permitted by applicable law, the Trustee shall be fully
protected in so doing. Any amounts so paid shall be reduced by the
amount of any federal, state, or local income or other taxes that
may be required by law to be withheld or paid by the Trustee and
the Trustee shall withhold, pay, and report such amounts to the
appropriate governmental authorities; provided, however, that the
Company, the Committee, the Members, and the Beneficiaries shall
provide the Trustee with all of the information necessary for the
Trustee to determine the amount of such taxes required to be
withheld or paid by the Trustee and the Trustee shall be fully
protected in relying upon such information. Notwithstanding any
provision of this Trust Agreement to the contrary, the Company
shall be obligated to pay the Benefits. To the extent that the
Trust Fund is not sufficient to pay any Benefit when due, the
Company shall pay such Benefit directly. In the event Benefits are
due to more than one Member or Beneficiary on the same date and the
Trust Fund is not sufficient to pay all such Benefits, the Trust
Fund shall be applied pro rata among such Members and Beneficiaries
on the basis of the Benefits due to be paid such individuals on
such date. Nothing in this Trust Agreement shall relieve the
Company of its liabilities to pay Benefits except to the extent
such liabilities are met by application of Trust Fund assets.
(b) Prior to the occurrence of a Change in Control,
the Committee shall direct the Trustee in writing as to the time
and amount of Benefits to be distributed to the Members and
Beneficiaries. From and after the occurrence of a Change in
Control, a Member or Beneficiary who believes that he or she is
entitled to Benefits may apply in writing directly to the Trustee
for payment of such Benefits. Such application shall advise the
Trustee of the circumstances which entitle such Member or
Beneficiary to payment of such Benefits. The Trustee shall, in
such case, reach its own independent determination as to the
Member's or Beneficiary's entitlement to Benefits, even though the
Trustee may be informed from another source (including the Company
or the Committee) that payments are not due under the Plan. If the
Trustee so desires, it may, in its sole discretion, make such
additional inquiries and/or take such additional measures as it
deems necessary in order to enable it to determine whether Benefits
are due and payable, including, but not limited to, interviewing
appropriate persons, requesting affidavits, soliciting oral or
written testimony under oath, or holding a hearing or other
proceeding. After the occurrence of a Change in Control, the
Trustee shall determine whether Benefits are payable as promptly as
possible.
(c) At any time and from time to time, the Committee
may direct the Trustee in writing to distribute to the Company cash
held by the Trustee as part of the Trust Fund in an amount equal to
the Benefits accrued under the Plan that have been forfeited under
the terms of the Plan. As soon as practicable after receipt of
such a direction and, if such direction is received by the Trustee
after the occurrence of a Change in Control, the Trustee's
independent determination that such benefits have, in fact, been
forfeited in accordance with the terms of the Plan, the Trustee
shall distribute such amount to the Company.
(d) At any time and from time to time prior to the
occurrence of a Change in Control, the Company may apply in writing
to the Trustee for a distribution by the Trustee to the Company of
assets held by the Trustee as part of the Trust Fund ("Trust
Assets") in an amount (the "Refund Amount") equal to or less than
the difference, if any, between (i) the Net Fair Market Value of
the Trust Assets (as such term is hereinafter defined) as of the
last day of the month coincident with or immediately preceding the
date of such application, and (ii) 125% of the aggregate Account
Balances for all Members and Beneficiaries as of such date. Such
application shall advise the Trustee of the manner in which the
Refund Amount was calculated. Upon the receipt of such an
application from the Company, the Trustee shall reach its own
independent determination as to the Company's entitlement to the
Refund Amount, even though the Trustee may be informed from another
source (including a Member) that the Company is not entitled to the
Refund Amount. If the Trustee so desires, it may, in its sole
discretion, make such additional inquiries and/or take such
additional measures as it deems necessary in order to enable it to
determine whether the Company is entitled to the Refund Amount,
including, but not limited to, interviewing appropriate persons,
requesting affidavits, soliciting oral or written testimony under
oath, or engaging such independent third parties as the Trustee may
deem necessary to assist in making such determination. The Trustee
shall determine whether the Company is entitled to all or any
portion of the Refund Amount as promptly as possible. If the
Trustee determines that the Company is entitled to all or any
portion of the Refund Amount, then the Trustee shall distribute
such amount to the Company in cash or in kind as determined by the
Trustee in its sole discretion. As used herein, the term "Net Fair
Market Value of the Trust Assets" shall mean the fair market value
of the Trust Assets, as determined by the Trustee in its sole
discretion, reduced by all liabilities of the Trust, whether or not
such liabilities are secured by any or all of the Trust Assets,
other than liabilities to Members or Beneficiaries under the Plan.
In determining such fair market value, the Trustee shall use such
market quotations and other information as are available to it and
may in its discretion be appropriate; provided, however, that the
fair market value of any life insurance contract which constitutes
a portion of the Trust Assets shall be its net cash surrender
value. The determination of the Net Fair Market Value of the Trust
Assets by the Trustee shall not constitute a representation by the
Trustee that the amounts reported as fair market values would
actually be realized upon the liquidation of the Trust Assets. The
Trustee shall not be accountable to the Company or to any other
person, including the Members or Beneficiaries, on the basis of any
such valuation except as otherwise provided in this Trust
Agreement.
(e) The Trustee may engage its own counsel or other
experts to assist it in making any determination under Section
3.6(a), (b), (c), (d) or (g) hereof. The cost of such counsel or
other expert assistance, and any other costs reasonably incurred by
the Trustee in making any such determination, shall be borne by the
Company. If the Company fails to pay any such costs when due or
requested by the Trustee, the Trustee may use the assets of the
Trust Fund to pay them as provided in Section 5.2.
(f) The Trustee shall not itself commence any legal
action, whether in the nature of an interpleader action, request
for declaratory judgment or otherwise, requesting a court to make
a determination under Section 3.6(a), (b), (c) or (d) hereof in the
Trustee's stead without first using its best efforts to make such
determination.
(g) Notwithstanding any other provision of this Trust
Agreement, if any amounts held in the Trust are found in a
"determination" (within the meaning of Section 1313(a) of the
Internal Revenue Code of 1986, as amended) to have been includible
in gross income of a Member or Beneficiary prior to payment of such
amounts from the Trust, the Trustee shall, as soon as practicable
after receiving notice thereof, pay such amounts to such Member or
Beneficiary, as applicable, (but not in excess of such Member's or
Beneficiary's Account Balance at the time of such payment). For
purposes of this Section 3.6, the Trustee shall be entitled to rely
on an affidavit by a Member or Beneficiary, as applicable, and a
copy of the determination to the effect that a determination
described in the preceding sentence has occurred.
ARTICLE IV
Settlement of Accounts
The Trustee shall keep full accounts of all of its receipts
and disbursements. The Trustee's books and records with respect to
the Trust Fund shall be open to inspection by the Company, any
Member, or any Beneficiary of a deceased Member, or their
representatives at all times during business hours of the Trustee.
Within sixty days after December 31 of each year (or such other
date as may be agreed to by the Company and the Trustee), or any
termination of the duties of the Trustee, the Trustee shall
prepare, sign and mail to the Company and the Committee an account
of its acts and transactions as Trustee hereunder. If, within
sixty days after the mailing of the account or any amended account,
the Company and the Committee have not filed with the Trustee
notice of any objection to any act or transaction of the Trustee,
the account or amended account shall become an account stated. If
any objection has been filed, and if the objecting party is
satisfied that it should be withdrawn or if the account is adjusted
to the objecting party's satisfaction, the objecting party shall in
writing filed with the Trustee signify its approval of the account
and it shall become an account stated. When an account becomes an
account stated, such account shall be finally settled, and the
Trustee shall be completely discharged and released, as if such
account had been settled and allowed by a judgment or decree of a
court of competent jurisdiction in an action or proceeding in which
the Trustee, the Company and the Committee were parties. The
Trustee, the Company or the Committee shall have the right to apply
at any time to a court of competent jurisdiction for judicial
settlement of any account of the Trustee not previously settled as
hereinabove provided. In any such action or proceeding it shall be
necessary to join as parties the Trustee, the Company and the
Committee and any judgment or decree entered therein shall be
conclusive upon all such parties.
ARTICLE V
Taxes, Expenses and Compensation of Trustee
5.1 Taxes. The Company agrees that all income, deductions,
and credits of the Trust Fund belong to it as owner for income tax
purposes and will be included on the Company's income tax returns.
The Company shall from time to time pay taxes (references in this
Trust Agreement to the payment of taxes shall include interest and
applicable penalties) of any and all kinds whatsoever which at any
time are lawfully levied or assessed upon or become payable in
respect of the Trust Fund, the income or any property forming a
part thereof, or any security transaction pertaining thereto. To
the extent that any taxes levied or assessed upon the Trust Fund
are not paid by the Company or contested by the Company pursuant to
the last sentence of this Section 5.1, the Trustee shall pay such
taxes out of the Trust Fund and the Company shall upon demand by
the Trustee deposit into the Trust Fund an amount equal to the
amount paid from the Trust Fund to satisfy such tax liability. If
requested by the Company, the Trustee shall, at Company expense,
contest the validity of such taxes in any manner deemed appropriate
by the Company or its counsel, but only if it has received an
indemnity bond or other security satisfactory to it to pay any
expenses of such contest. Alternatively, the Company may itself
contest the validity of any such taxes, but any such contest shall
not affect the Company's obligation to reimburse the Trust Fund for
taxes paid from the Trust Fund.
5.2 Expenses and Compensation. The Trustee shall be paid
compensation by the Company as the Company and the Trustee may from
time to time agree. The Trustee shall be reimbursed by the Company
for its reasonable expenses of management and administration of the
Trust, including reasonable compensation of counsel and any agent
engaged by the Trustee to assist it in such management and
administration. In the event that the Company shall fail or refuse
to pay such compensation or make such reimbursement within sixty
days of demand, the Trustee may satisfy such obligations out of the
assets of the Trust Fund; in that event, the Company shall
immediately upon demand by the Trustee deposit into the Trust Fund
a sum equal to the amount paid by the Trust Fund for such fees and
expenses.
ARTICLE VI
For Protection of Trustee
6.1 Communications with the Company, the Committee and the
Members.
(a) The Company shall certify to the Trustee the name
or names of any person or persons authorized to act for the Company
and for the Committee. Such certification shall be signed by an
officer of the Company. Until the Company notifies the Trustee, in
a similarly signed notice, that any such person is no longer
authorized to act for the Company or for the Committee, as
applicable, the Trustee may continue to fully rely upon the
authority of such person.
(b) The Trustee may fully rely upon any certificate,
notice or direction of the Company or the Committee which the
Trustee reasonably believes to have been signed by a duly
authorized officer or agent of the Company or the Committee, as
applicable.
(c) Communications to the Trustee shall be sent in
writing to the Trustee at
, or to such other address
as the Trustee may specify. No communication shall be binding upon
the Trust Fund or the Trustee until it is received by the Trustee
and unless it is in writing and signed by an authorized person.
(d) Communications to the Company shall be sent in
writing to the Company at 1600 Smith Street, Dept. HQSEO, Houston,
Texas 77002, Attention: General Counsel, or to such other address
as the Company may specify in writing to the Trustee.
Communications to the Committee shall be sent in writing to the
Company's address, Attention: Deferred Compensation Plan
Administrative Committee. Communications to a Member or
Beneficiary shall be sent in writing to the address of such person
as stated on the Benefit Schedule, or to such other address as such
person may specify in writing to the Trustee. No communication
shall be binding upon the Company, the Committee, or a Member or
Beneficiary until it is received by such person.
6.2 Advice of Counsel. The Trustee may consult with any
legal counsel with respect to the construction of this Trust
Agreement, its duties hereunder or any act which it proposes to
take or omit, and shall not be liable for any action taken or
omitted in good faith pursuant to such advice. Expenses of such
counsel shall be deemed to be expenses of management and
administration of the Trust within the meaning of Section 5.2
hereof.
6.3 Fiduciary Responsibility.
(a) The Trustee shall discharge its duties under this
Trust Agreement in effectuating the Plan in a manner consistent
with the objectives of this Trust Agreement and the Plan. The
Trustee shall not be liable for any loss sustained by the Trust
Fund by reason of the purchase, retention, sale or exchange of any
investment in good faith and in accordance with the provisions of
this Trust Agreement. The Trustee shall have no responsibility or
liability for any failure of the Company to make contributions to
the Trust Fund or for any insufficiency of assets in the Trust Fund
to pay Benefits when due. The Trustee shall not be liable
hereunder for any act taken or omitted to be taken in good faith,
except for its own negligence or misconduct.
(b) No bond shall be required of the Trustee unless
otherwise required by law.
(c) The Trustee's duties and obligations shall be
limited to those expressly imposed upon it by this Trust Agreement.
(d) The Company at any time may employ as agent (to
perform any act, keep any records or accounts, or make any
computations required of the Company or the Committee by this Trust
Agreement or the Plan) the individual, corporation or association
serving as Trustee hereunder. Nothing done by said individual,
corporation or association as such agent shall affect its
responsibilities or liability as Trustee hereunder.
ARTICLE VII
Indemnity of Trustee
The Company hereby indemnifies and holds the Trustee harmless
from and against any and all losses, damages, costs, expenses or
liabilities (herein, "Liabilities"), including reasonable
attorneys' fees and other costs of litigation, to which the Trustee
may become subject pursuant to, arising out of, occasioned by,
incurred in connection with or in any way associated with this
Trust Agreement, except for any act or omission constituting
negligence or misconduct of the Trustee. If one or more
Liabilities shall arise, or if the Company fails to indemnify the
Trustee as provided herein, or both, then the Trustee may engage
counsel of the Trustee's choice, but at the Company's expense,
either to conduct the defense against such Liabilities or to
conduct such actions as may be necessary to obtain the indemnity
provided for herein, or to take both such actions. The Trustee
shall notify the Company within five days after the Trustee has so
engaged counsel of the name and address of such counsel. If the
Trustee shall be entitled to indemnification by the Company
pursuant to this Article VII and the Company shall not provide such
indemnification upon demand, the Trustee may apply assets of the
Trust Fund in full satisfaction of the obligations for indemnity by
the Company, and any legal proceeding by the Trustee against the
Company for such indemnification shall be on behalf of the Trust.
ARTICLE VIII
Resignation and Removal of Trustee
8.1 Resignation of Trustee. The Trustee may resign upon
sixty days' prior written notice to the Human Resources Committee
of the Board of Directors of Continental Airlines, Inc. (the "Human
Resources Committee"), the Committee, each Member and each
Beneficiary of a deceased Member, except that any such resignation
shall not be effective until the Human Resources Committee has
appointed in writing a successor trustee, which must be a bank,
trust company, or an individual, and such successor has accepted
the appointment in writing; provided, however, that if such
appointment is to become effective at any time after the occurrence
of a Change in Control, then the consent of a majority of the
Members to the appointment of such successor trustee must be
obtained. For all purposes of this Trust Agreement where the
consent of a majority of the Members is required, the determination
of majority consent shall be based upon receiving the consent of
any combination of Members whose sum of Account Balances as of the
time of determination is greater than fifty percent of the sum of
Account Balances for all Members at such time, rather than upon
receiving the consent of a majority of the number of Members. For
purposes of this determination, Beneficiaries of deceased Members
shall be considered Members. The Human Resources Committee shall
make a good faith effort, following receipt of notice of
resignation from the Trustee, to find and appoint a successor
Trustee who will adhere to the obligations imposed on such
successor under the terms of this Trust Agreement, and in
particular, but without limitation, the obligation to exercise
judgment independent of the Company in the circumstances described
in Section 3.6 hereof. The appointment of a successor trustee
shall also be conditioned upon obtaining from such successor a
written statement that the successor has read the Trust Agreement
and understands its obligations thereunder. If the consent of a
majority of the Members is required for the appointment of a
successor Trustee, then the Trustee shall be responsible for
securing such Member consents in a timely fashion and, unless
ordered by a court of competent jurisdiction, shall not reveal to
the Human Resources Committee, the Company, the Committee or any
other person any information concerning such consents, except
whether the required majority has been achieved. Any notice sent
to Members by the Trustee canvassing the Members as to their
consent to a successor trustee shall include the name and address
of the proposed successor trustee. Any consent of a Member
required under this Section 8.1 shall be deemed given if no written
objection is received by the Trustee from such Member within
fourteen days after request for such consent is sent postpaid by
United States registered or certified mail with return receipt
requested to such Member.
8.2 Removal of Trustee. The Human Resources Committee may
remove the Trustee upon sixty days' prior written notice to the
Trustee and the Committee, except that any such removal shall not
be effective until (a) the close of such notice period, (b) the
delivery by the Human Resources Committee to the Trustee of an
instrument in writing appointing a successor trustee meeting the
requirements of Section 8.1, and (c) an acceptance of such
appointment in writing executed by such successor. Notwithstanding
the provisions of the preceding sentence, if such appointment of a
successor trustee is to become effective at any time after the
occurrence of a Change in Control, then the removal of the Trustee
and the appointment of a successor trustee shall not be effective
until the Trustee has received the consent of a majority of the
Members (as determined in accordance with the provisions of Section
8.1 hereof) to such removal and such appointment. Upon the receipt
by the Trustee of a written notice of removal, the Trustee shall be
responsible for securing the Member consents (if such consents are
required pursuant to the preceding provisions of this Section 8.2)
in a timely fashion and, unless ordered by a court of competent
jurisdiction, shall not reveal to the Human Resources Committee,
the Company, the Committee or any other person any information
concerning such consents, except whether the required majority has
been achieved. Any notice sent to Members by the Trustee
canvassing the Members as to their consent to removal of the
Trustee and the appointment of a proposed successor trustee, shall
include the name and address of the proposed successor trustee.
Any consent of a Member required under this Section 8.2 shall be
deemed given if no written objection is received by the Trustee
from such Member within fourteen days after request for such
consent is sent postpaid by United States registered or certified
mail with return receipt requested to such Member.
8.3 Successor Trustee. All of the provisions set forth
herein with respect to the Trustee shall relate to each successor
with the same force and effect as if such successor had been
originally named as the Trustee hereunder.
8.4 Transfer of Trust Fund to Successor. Upon the
resignation or removal of the Trustee and appointment of a
successor, the Trustee shall transfer and deliver the Trust Fund to
such successor. Following the effective date of the appointment of
the successor, the Trustee's responsibility hereunder shall be
limited to managing the assets in its possession and transferring
such assets to the successor, and settling its final account.
Neither the Trustee nor the successor shall be liable for the acts
of the other.
ARTICLE IX
Duration and Termination of Trust and Amendment
9.1 Duration and Termination. The Trust is hereby declared
to be irrevocable and shall continue until (a) all payments
required by Section 3.6 have been made or (b) until the Trust Fund
contains no assets and retains no claims to recover assets from the
Company or any other person or entity, whichever shall first occur.
Notwithstanding the preceding provisions of this Section 9.1,
unless earlier terminated, the Trust shall terminate twenty-one
(21) years after the death of the last to die of all of the Members
and their issue living on the effective date of this Trust
Agreement; provided, however, that if at that time the Trust may be
continued in force without violating the rule against perpetuities
or any other law of the State of Texas, then the Trust shall remain
in effect until otherwise terminated as provided hereunder.
9.2 Distribution upon Termination. If this Trust terminates
under the provisions of Section 9.1, the Trustee shall liquidate
the Trust Fund and, after its final account has been settled as
provided in Article IV, shall distribute to the Company the net
balance of any assets of the Trust remaining after all expenses
have been paid and all Benefits, whether or not due and payable
under the terms of the Plan on the date of such termination, have
been paid to the Members and Beneficiaries. Upon making such
distribution, the Trustee shall be relieved from all further
liability. The powers of the Trustee hereunder shall continue so
long as any assets of the Trust Fund remain in its hands.
9.3 Amendment. The Human Resources Committee may from time
to time amend, in whole or in part, any or all of the provisions of
this Trust Agreement; provided, however, that (a) no amendment will
be made to this Trust Agreement or the Plan which will cause this
Trust Agreement, the Plan or the assets of the Trust Fund to be
governed by or subject to Part 2, 3, or 4 of Title I of ERISA, (b)
no such amendment shall adversely affect any Benefits to the date
of such amendment in respect of any Member or Beneficiary or the
amount of assets of the Trust Fund available to pay such Benefits,
(c) no such amendment shall purport to alter the irrevocable
character of the Trust established under this Trust Agreement, (d)
no such amendment shall increase the duties or responsibilities of
the Trustee unless the Trustee consents thereto in writing, and (e)
after the occurrence of a Change in Control, no amendment will be
made to this Trust Agreement without the consent of a majority of
the Members (as determined pursuant to the provisions of Section
8.1 hereof). Upon receipt of a request from the Human Resources
Committee for an amendment which requires the consent of a majority
of the Members, the Trustee shall be responsible for securing
Member consents in a timely fashion, and unless ordered by a court
of competent jurisdiction, shall not reveal to the Human Resources
Committee, the Committee, the Company, or any other person any
information concerning such consents, except whether the required
majority has been achieved. Any consent of a Member required under
this Section 9.3 shall be deemed given if no written objection is
received by the Trustee from such Member within fourteen days after
request for such consent is sent postpaid by United States
registered or certified mail with return receipt requested to such
Member. This Trust Agreement may be amended, to the extent
permitted in this Section 9.3, by an instrument in writing executed
on behalf of Continental Airlines, Inc. by its authorized
representatives, consents to which instrument have been obtained
from the required majority of Members if such consents are
required.
ARTICLE X
Claims of Company's Creditors
10.1 Insolvency of Company. As used in this Article X, the
Company shall be deemed to be "Insolvent" if (a) the Company is
unable to pay its debts as they come due, or (b) the Company is
subject to a pending proceeding as a debtor under the United States
Bankruptcy Code (or any successor federal statute). In the event
that the Company shall be deemed Insolvent, the assets of the Trust
Fund shall be held for the benefit of the general creditors of the
Company (hereinafter referred to as "Bankruptcy Creditors").
10.2 Trustee's Responsibilities if Company may be Insolvent.
(a) If at any time the Company or a person claiming to
be a creditor of the Company alleges in writing to the Trustee that
the Company has become Insolvent, the Trustee shall within thirty
days independently determine whether the Company is Insolvent and,
pending such determination, the Trustee shall discontinue any
payment of Benefits under the Plan and this Trust Agreement and
shall hold the Trust Fund for the benefit of Bankruptcy Creditors.
The Trustee shall resume payments of Benefits under the Plan and
this Trust Agreement in accordance with Section 3.6 hereof only
after the Trustee has determined that the Company is not Insolvent
(or is no longer Insolvent, if the Trustee initially determined the
Company to be Insolvent) or upon receipt of an order of a court of
competent jurisdiction requiring such payments. The Company, by
its chief executive officer and its Board of Directors, shall
further be obligated to give the Trustee prompt notice in writing
in the event that the Company becomes Insolvent, with the same
consequences as provided in the preceding two sentences. In
determining whether the Company is Insolvent, the Trustee may rely
conclusively upon, and shall be protected in relying upon, court
records showing that the Company is Insolvent, or a current report
or statement from a nationally recognized credit reporting agency
showing that the Company is Insolvent. For purposes of this Trust
Agreement, knowledge and information concerning the Company which
is not in the possession of the Trustee shall not be imputed to the
Trustee. The Trustee shall have no duty or obligation to ascertain
whether the Company is Insolvent unless and until it receives a
writing that the Company is Insolvent as described in the first or
third sentence of this Section 10.2(a).
(b) If the Trustee determines that the Company is
Insolvent, the Trustee shall hold the assets of the Trust Fund for
the benefit of the Bankruptcy Creditors, and shall disburse the
assets of the Trust Fund to satisfy such claims as a court of
competent jurisdiction shall direct.
(c) If the Trustee discontinues payment of Benefits
pursuant to Section 10.2(a) and subsequently resumes such payments,
the first payment to a Member or Beneficiary following such
discontinuance shall include an aggregate amount equal to the
difference between the payments that would have been made to such
Member or Beneficiary, as applicable, under this Trust Agreement
but for this Section 10.2 and the aggregate payments actually made
to such Member or Beneficiary, as applicable, by the Company
pursuant to the Plan during any such period of discontinuance. In
the event that upon resumption of payments pursuant to the
preceding sentence, the assets of the Trust Fund are insufficient
to pay Benefits in full, Benefit payments to the affected Members
and Beneficiaries shall be prorated so as to equitably apportion
the assets of the Trust Fund among all affected Members and
Beneficiaries in proportion to their Benefits.
10.3 Trust Recovery of Payments to Creditors. In the event
that at any time an amount is paid from the Trust Fund to
Bankruptcy Creditors of the Company, the Trustee shall demand that
the Company deposit into the Trust Fund a sum equal to the amount
paid by the Trust Fund to such Bankruptcy Creditors and, if such
payment is not made within ninety days of such demand, the Trustee
shall take such action as it deems prudent or advisable to recover
payment.
ARTICLE XI
Adopting Entities
It is contemplated that other corporations, associations,
partnerships or proprietorships that have adopted the Plan may
adopt this Trust Agreement and thereby become the Company. Any
such entity, whether or not presently existing, may become a party
hereto by appropriate action of its officers without the need for
approval of its board of directors or noncorporate counterpart or
of the Human Resources Committee or the Committee. As of the date
hereof, the Company, Continental Express, Inc., and Continental
Micronesia, Inc. have adopted the Plan and shall be deemed to be
parties to this Trust Agreement. The provisions of the Trust
Agreement shall apply separately and equally to the Company and
each other adopting entity and their respective Members and their
Beneficiaries in the same manner as is expressly provided for the
Company and its Members and their Beneficiaries, except that (a)
the power to appoint or otherwise affect the Trustee and the power
to amend the Trust Agreement shall be exercised by the Human
Resources Committee alone and (b) the determination of whether a
Change in Control has occurred shall be based solely on the
Company.
ARTICLE XII
Miscellaneous
12.1 Laws of Texas to Govern. This Trust Agreement and the
Trust hereby created shall be construed and regulated by the laws
of the State of Texas.
12.2 Titles and Headings Not to Control. The titles to
Articles and headings of Sections in this Trust Agreement are
placed herein for convenience of reference only and, in the case of
any conflict, the text of this Trust Agreement, rather than such
titles or headings, shall control.
12.3 Affiliates. As used in this Trust Agreement, the term
"affiliate" as applied to the Company or to the Trustee means any
person or entity that directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common
control with, the Company or the Trustee, as the case may be. For
purposes of this definition, the term "control" as used with
respect to any person or entity shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the
management and policies of such person or entity, whether through
the ownership of an equity interest in such entity, by contract or
otherwise.
12.4 Change in Control. For purposes of this Trust
Agreement, the term "Change in Control" shall have the same meaning
as is assigned to such term under the Continental Airlines, Inc.
1998 Stock Incentive Plan, as in effect on January 1, 1999.
Continental Airlines, Inc., by its chief executive officer and the
Human Resources Committee, shall be obligated to give the Trustee
prompt notice in writing of the occurrence of a Change in Control.
In the event the Trustee receives such a notice or if at any time
a Member or a Beneficiary of a deceased Member alleges in writing
to the Trustee that a Change in Control has occurred, the Trustee
shall within thirty days independently determine whether a Change
in Control has occurred and, pending such determination, the
Trustee shall assume that a Change in Control has occurred for all
purposes of this Trust Agreement and the Plan. The Trustee shall
have no duty or obligation to ascertain whether a Change in Control
has occurred unless it receives a written notice as described in
either of the preceding two sentences. In determining whether a
Change in Control has occurred, the Trustee may, in its sole
discretion, make such additional inquiries and/or take such
additional measures as it deems necessary, including, but not
limited to, interviewing appropriate persons, requesting
affidavits, soliciting oral or written testimony under oath, or
engaging such independent third parties as the Trustee may deem
necessary to assist in making such determination. Notwithstanding
the foregoing, if at any time Continental Airlines, Inc.'s chief
executive officer or the Human Resources Committee notifies the
Trustee in writing that the Trustee should interpret this Trust
Agreement and the Plan as if a Change in Control had occurred, then
for all purposes of this Trust Agreement and the Plan, the Trustee
shall so interpret this Trust Agreement and the Plan. Once the
notice described in the preceding sentence is received by the
Trustee, it may not be rescinded.
12.5 Successors and Assigns. This Trust Agreement may not be
assigned by either party without the prior written consent of the
other, and any purported assignment without such prior written
consent shall be null and void. This Trust Agreement shall be
binding upon the successors and permitted assigns of each party
hereto.
12.6 Controlling Document. Should an inconsistency or
conflict exist between the specific terms of this Trust Agreement
and those of the Plan, then the relevant terms of this Trust
Agreement shall govern and control.
IN WITNESS WHEREOF, the parties hereto have caused this
Trust Agreement to be executed as of the day and year first above
written.
CONTINENTAL AIRLINES, INC.
By:__________________________
Name:________________________
Title:_______________________
_____________________________
_______________, Trustee
By:__________________________
Name: _______________________
Title: ______________________
OTHER ADOPTING ENTITIES
AS OF JANUARY 1, 1999:
CONTINENTAL EXPRESS, INC.
By:_________________________
Name: ______________________
Title: _____________________
CONTINENTAL MICRONESIA, INC.
By:_________________________
Name: ______________________
Title: _____________________
Exhibit 5.1
November 30, 1998
Continental Airlines, Inc.
1600 Smith Street, Dept. HQSEO
Houston, Texas 77002
Ladies and Gentlemen:
I am the Executive Vice President and General Counsel of
Continental Airlines, Inc., a Delaware corporation (the "Company").
In that capacity, I am familiar with the Company's Registration
Statement on Form S-8 (the "Registration Statement") relating to a
proposed offering and issuance of Deferred Compensation
Obligations (the "Obligations") of the Company pursuant to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
which may include the purchase by the Plan of shares of Class B
Common Stock, $.01 par value, of the Company (the "Shares") .
This opinion is delivered in accordance with the requirements
of Item 601(b)(5) of Regulation S-K under the Securities Act of
1933 (the "Act"). In arriving at the opinions expressed below, I
or other members of my legal staff have reviewed certain corporate
records of the Company, including its Amended and Restated
Certificate of Incorporation, its Bylaws, certain resolutions of
the Board of Directors of the Company, the Plan, the Continental
Airlines, Inc. Deferred Compensation Plan Trust Agreement (the
"Trust Agreement"), the Registration Statement together with the
exhibits thereto, and such certificates of officers of the Company
and other documents and records as I have deemed necessary for the
purposes of this opinion.
As to matters of fact relevant to the opinions expressed
herein, and as to factual matters arising in connection with our
examination of corporate documents, records and other documents and
writings, I and members of my legal staff relied upon certificates
and other communications of corporate officers of the Company,
without further investigation as to the facts set forth therein.
We have assumed the authenticity of all documents submitted to us
as originals and the conformity to the originals of all documents
submitted to us as copies. In addition, we have assumed and have
not verified the accuracy as to factual matters of each document we
have reviewed.
Based upon the foregoing, I am of the opinion that (a) the
Obligations issued pursuant to the Plan will be binding obligations
of the Company and (b) any Shares acquired by the Plan from time to
time will be validly issued, fully paid and nonassessable.
The foregoing opinions are limited to the federal law of the
United States of America, the General Corporation Law of the State
of Delaware and the law of the State of Texas, in each case as in
effect on the date hereof, except that I express no opinion with
respect to (i) the laws, regulations or ordinances of any county,
town or municipality or governmental subdivision or agency thereof,
(ii) federal or state securities or blue sky laws, including
without limitation the Securities Act of 1933 and the Investment
Company Act of 1940, each as amended, (iii) any federal or state
tax, antitrust or fraudulent transfer or conveyance laws or (iv)
the Employee Retirement Income Securities Act of 1974, as amended.
I have assumed, for purposes of the foregoing opinions, that all
Shares issued by the Company after the date hereof will be validly
issued, fully paid and nonassessable. In addition, my opinions are
based upon a review of those laws, statutes, rules and regulations
which, in my experience, are normally applicable to transactions of
the type contemplated by the Plan and Trust Agreement.
I hereby consent to the filing of this opinion as an exhibit
to the Registration Statement. However, by giving such consent, I
do not admit that I am within the category of persons whose consent
is required under Section 7 of the Act or the rules and regulations
of the Securities and Exchange Commission issued thereunder.
Very truly yours,
_____________________________
Jeffery A. Smisek
Executive Vice President and
General Counsel
Exhibit 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8) of Continental Airlines, Inc. (the "Company")
pertaining to the Continental Airlines, Inc. Deferred Compensation
Plan of our report dated February 9, 1998 (except for Note 13, as
to which the date is March 18, 1998) with respect to the
consolidated financial statements and our report dated March 18,
1998 with respect to the related financial statement schedule, all
included in the Company's 1997 Annual Report (Form 10-K), filed
with the Securities and Exchange Commission.
Houston, Texas
December 1, 1998
Exhibit 24.1
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does
hereby constitute and appoint Jeffery A. Smisek, Jennifer L.
Vogel and Scott R. Peterson, or any of them, as the undersigned's
true and lawful attorneys in-fact and agents to do any and all
things in the undersigned's name and behalf in the undersigned's
capacity as a director and/or officer of the Company, and to
execute any and all instruments for the undersigned and in the
undersigned's name and capacity as a director and/or officer that
such person or persons may deem necessary or advisable to enable
the Company to comply with the Securities Act of 1933, as
amended, and any rules, regulations or requirements of the
Securities and Exchange Commission in connection with that
certain Registration Statement on Form S-8 (the "Registration
Statement") relating to the Continental Airlines, Inc. Deferred
Compensation Plan (the "Plan"), including specifically, but not
limited to, power and authority to sign for the undersigned in
the capacity as a director and/or officer of the Company the
Registration Statement, and any and all amendments thereto,
including post-effective amendments, and the undersigned does
hereby ratify and confirm all that such person or persons shall
do or cause to be done by virtue hereof.
/s/ Gordon M. Bethune
(Signature)
Printed Name: Gordon M.
Bethune
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Lawrence W. Kellner
(Signature)
Printed Name: Lawrence W. Kellner
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Michael P. Bonds
(Signature)
Printed Name: Michael P. Bonds
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Thomas J. Barrack, Jr.
(Signature)
Printed Name: Thomas J. Barrack, Jr.
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Lloyd M. Bentsen, Jr.
(Signature)
Printed Name: Lloyd M. Bentsen, Jr.
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ David Bonderman
(Signature)
Printed Name: David Bonderman
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Gregory D. Brenneman
(Signature)
Printed Name: Gregory D. Brenneman
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Patrick Foley
(Signature)
Printed Name: Patrick Foley
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Douglas H. McCorkindale
(Signature)
Printed Name: Douglas H. McCorkindale
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ George G.C. Parker
(Signature)
Printed Name: George G.C. Parker
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Richard W. Pogue
(Signature)
Printed Name: Richard W. Pogue
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ William S. Price III
(Signature)
Printed Name: William S. Price III
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Donald L. Sturm
(Signature)
Printed Name: Donald L. Sturm
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Karen Hastie Williams
(Signature)
Printed Name: Karen Hastie Williams
Dated and effective as of November 16, 1998
POWER OF ATTORNEY
The undersigned director and/or officer of Continental
Airlines, Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Jeffery A. Smisek, Jennifer L. Vogel and
Scott R. Peterson, or any of them, as the undersigned's true and
lawful attorneys in-fact and agents to do any and all things in the
undersigned's name and behalf in the undersigned's capacity as a
director and/or officer of the Company, and to execute any and all
instruments for the undersigned and in the undersigned's name and
capacity as a director and/or officer that such person or persons
may deem necessary or advisable to enable the Company to comply
with the Securities Act of 1933, as amended, and any rules,
regulations or requirements of the Securities and Exchange
Commission in connection with that certain Registration Statement
on Form S-8 (the "Registration Statement") relating to the
Continental Airlines, Inc. Deferred Compensation Plan (the "Plan"),
including specifically, but not limited to, power and authority to
sign for the undersigned in the capacity as a director and/or
officer of the Company the Registration Statement, and any and all
amendments thereto, including post-effective amendments, and the
undersigned does hereby ratify and confirm all that such person or
persons shall do or cause to be done by virtue hereof.
/s/ Charles A. Yamarone
(Signature)
Printed Name: Charles A. Yamarone
Dated and effective as of November 16, 1998