EXHIBIT 10.3

[GE LOGO]

GE AIRCRAFT ENGINES

General Electric Company

One Neumann Way

Cincinnati, OH 45215-6301

Phone: 513/243-2000

August 8, 2005

AMENDED AND RESTATED LETTER AGREEMENT NO. 11

Continental Airlines, Inc.

1600 Smith Street

Houston, Texas 77002

 

Gentlemen:

WHEREAS

, General Electric Company ("GE") and Continental Airlines, Inc. ("Airline")
have entered into Amended and Restated General Terms Agreement No. 6-8057 dated
as of November 1, 1994, as amended (together with Letter Agreement Nos. 1-12
thereto, collectively, the "Agreement");

WHEREAS

, GE and Airline entered into Letter Agreement No. 11 to the Agreement to set
forth the applicable terms and conditions governing [CONFIDENTIAL MATERIAL
OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT];

WHEREAS

, pursuant to Letter Agreement No. 11 [CONFIDENTIAL MATERIAL OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT];

WHEREAS

, Airline and GE desire to amend and restate Letter Agreement No. 11 to the
Agreement in its entirety to reflect their agreement regarding [CONFIDENTIAL
MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] the purchase of New
GE Engines (as defined below) and regarding Airline's commitment to equip
certain new aircraft with New GE Engines.

NOW THEREFORE

, in consideration of the mutual covenants and obligations contained herein,
Airline and GE agree to amend and restate Letter Agreement No. 11 in its
entirety as follows:

As previously established under the Agreement, additional 767 and 777 aircraft
acquired by the Airline shall be referred to either individually or collectively
as the "Follow-On Aircraft." GE agrees to provide Airline the Special Allowances
for such Follow-On Aircraft defined in and subject to all of the conditions set
forth in Attachment A hereto.

In exchange for Airline acquiring New Aircraft as New GE-Powered Aircraft,
[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]:

Airline agrees that if it acquires New Aircraft, and such New Aircraft are (i)
available as New GE-Powered Aircraft in the time period required by Airline, and
(ii) scheduled to deliver to Airline during [CONFIDENTIAL MATERIAL OMITTED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT], then Airline agrees that it will equip,
purchase, and take delivery of all New Aircraft as New GE-Powered Aircraft.

If Airline purchases New GE-Powered Aircraft, Airline agrees to purchase, or
cause to be purchased by a third party providing services in support of
Airline's New GE-Powered Aircraft operations, a quantity of New GE Engines, to
be used as spare engines, that is targeted, based on current engine technology,
at approximately [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT] of New GE Engines installed on each model of New GE-Powered Aircraft.
The Airline and the GE Affiliated Company that is manufacturing the New GE
Engine agree to mutually work together to optimize this quantity of spare
engines and determine what the appropriate percentage of spare engines the
Airline shall actually purchase or otherwise have at its disposal, in order to
maintain a sufficient level of fleet operational reliability.

In consideration of the agreement of the Airline in sub-paragraphs A and B
above, [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

The provisions of this Amended and Restated Letter Agreement No. 11 shall not
apply to any used aircraft that Airline acquires.

Defined Terms.

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

GE Affiliated Company

: GE, CFM, a GE joint venture company, or any other manufacturer of engines in
which GE is an affiliate.

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

New Aircraft

: Any new commercial passenger aircraft manufactured by an aircraft manufacturer
that is [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

New GE Engine

: [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

New GE-Powered Aircraft

: A New Aircraft that is offered for sale with installed New GE Engines by an
airframe manufacturer.

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

The obligations set forth in this Amended and Restated Letter Agreement No. 11
are in addition to and form part of the obligations set forth in the Agreement
and do not replace or modify any such obligations except as expressly provided
herein.

Counterparts:

This Amended and Restated Letter Agreement No. 11 may be executed by the parties
hereto in two or more counterparts and by the different parties hereto on
separate counterparts each of which shall be deemed to be an original but all of
which when taken together shall constitute one and the same document. Delivery
of an executed counterpart of a signature page to this Amended and Restated
Letter Agreement No. 11 by fax shall be effective as delivery of a manually
executed counterpart.

Please indicate your agreement with the foregoing by signing the original and
one copy in the space provided below and returning the same to the undersigned
whereby this Amended and Restated Letter Agreement No. 11 shall become effective
as of the date hereof (subject to the foregoing paragraph).

Very truly yours,

 

CONTINENTAL AIRLINES, INC.

 

GENERAL ELECTRIC COMPANY

     

By: /s/ Gerald Laderman

 

By: /s/ William R. Van Alsten

     

Typed Name: Gerald Laderman

 

Typed Name: William R. Van Alsten

     

Title: Senior Vice President,

Finance and Treasurer

 

Title: GM Commercial Engine

Transactions

     

Date: ____________________________

 

Date: 8 August 2005

ATTACHMENT A

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

1. Allowance for Initial Aircraft Sale Only

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

Follow-On Aircraft Allowance

In consideration of Airline purchasing and taking delivery of new CF6 powered
Follow-On Aircraft for delivery through [CONFIDENTIAL MATERIAL OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT], GE will provide Airline an allowance per aircraft as
defined by the formula below:

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

2. Allowance Not Paid

If (a) Airline for any reason terminates, cancels, revokes or delays beyond the
Follow-On Delivery Period (defined as a period of time not to exceed

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] unless
such delay occurs as a result of an Excusable Delay) its order for Follow-On
Aircraft or some portion thereof, or (b) Airline fails to perform, in any
material respect, any of the allowance conditions or other material terms of the
Agreement, in addition to the other remedies that may be available to GE in this
Attachment A, and, with respect to a failure to perform, in any material
respect, any of the other material terms of the Agreement, such other remedies
that may be available to GE at law or in equity, any allowance which may have
been earned by Airline upon delivery of GE Engines to the aircraft manufacturer
for affected Aircraft shall become an unearned allowance, and will not be paid;
provided, however, that such an unearned allowance relating to a delayed
CF6/GE90 Follow-On Aircraft may be reinstated and paid to Airline upon delivery
of such CF6/GE90 Follow-On Aircraft if (i) such delay was not attributable to a
breach by Airline under the applicable aircraft manufacturer's purchase
agreement, this Agreement or any other applicable agreement, and (ii) Airline
accepts such CF6/GE90 Follow-On Aircraft promptly when tendered by Boeing; and
(iii) such acceptance occurs not later than the Follow-On Delivery Period,
subject to excusable delay as defined in paragraph 10 hereof.

3. Adjustment of Allowances

GE and Airline agree that in April 2002 Airline satisfied the requirement of
[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]. The
respective CF6 and GE90 Follow-On Aircraft Allowances described in Article 1.A
of this Attachment A will be at least [CONFIDENTIAL MATERIAL OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT] for CF6-powered Follow-On Aircraft, and at least
[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] for GE90
powered Follow-On Aircraft.

The Special Allowances described in Article 1.A of this Attachment A will not be
applicable to Follow-On Aircraft delivered after [CONFIDENTIAL MATERIAL OMITTED
AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT].

The cut-off dates set forth in this paragraph 3 are subject to extension for
excusable delay [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT].

 

4. Assignability of Allowances

The allowances described herein are exclusively for the benefit of Airline, and
are not assignable, except in connection with Airline's financing of the
Aircraft.

5. [CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

6. Cancellation of CF6/GE90 Follow-On Spare Engines

GE and Airline agree that in October 2004 Airline satisfied previous
requirements for

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]

7. Cancellation or Failure to Accept Delivery of Installed Engines

If Airline cancels any purchase order for, or otherwise fails to take delivery
of, installed CF6/GE90 Follow-On Aircraft engine(s) (individually or
collectively, the "Engine"), the parties agree that harm or damage will be
sustained by GE as a result. The parties agree that any such cancellation or
failure to accept delivery of the Engine (except in circumstances constituting
Excusable Delay) will subject Airline to a cancellation charge of

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT]
(determined as of the date of scheduled Engine delivery to the aircraft
manufacturer). If Airline provides notice of cancellation at least [CONFIDENTIAL
MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] prior to the
scheduled delivery date of the aircraft, the parties acknowledge this charge
[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] and to be
a reasonable estimate of the harm or damage to GE. To the extent that GE gets
paid cancellation fees by or receives credit or other quantifiable consideration
from the aircraft manufacturer with respect to installed Engines for Airline's
canceled aircraft or aircraft for which Airline has failed to accept delivery
when duly tendered, GE will credit Airline the value of such fees, credits or
other quantifiable consideration against such cancellation charge and any other
amounts owed to GE by Airline for damages relating to any such cancellation or
failure to accept delivery.

8. Additional Damages; Confidentiality

If GE does not receive written notice of cancellation (of spare or installed
engines) more than

[CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] prior to
scheduled delivery date to Airline for a spare engine, or [CONFIDENTIAL MATERIAL
OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT] prior to the delivery date of
the aircraft for an installed engine, GE will also retain all remedies available
to it for damages in law or equity in excess of such cancellation charge.

Airline agrees to cooperate with GE to maintain the confidentiality of any
proprietary information disclosed by GE in connection with proving any such
additional harm or damages, provided that any such disclosure shall be at GE's
discretion.

 

9. Excusable Delay

"Excusable Delay" with respect to an installed engine as used in this Attachment
A means a delay in delivery of an Aircraft not attributable to a failure of
Airline to timely perform its obligations under the aircraft manufacturer's
purchase agreement (without giving effect to any supplement, modification or
waiver thereto which directly or indirectly results in a permitted delay of the
scheduled delivery of an aircraft unless GE shall have consented thereto, which
consent shall not be unreasonably withheld), including any event of force
majeure or a default by the aircraft manufacturer, provided, that Airline
accepts such aircraft promptly when tendered by the aircraft manufacturer.

An "Excusable Delay" with respect to a spare engine as used in this Attachment A
means a delay in delivery of a spare engine not attributable to a failure of
Airline to timely perform its obligations under the purchase agreement between
Airline and GE, including any event of default by GE or event of force majeure
provided, that Airline accepts such spare engine promptly when tendered by GE
after an event of force majeure.