EXHIBIT 10.1

AGREEMENT BETWEEN

THE UNITED STATES OF AMERICA

AND

CONTINENTAL AIRLINES, INC.

THIS Agreement ("Agreement") is made and entered into on this 7th day of May,
2003 ("Effective Date") by and between Continental Airlines, Inc. ("Air
Carrier") and the United States of America, acting through the Transportation
Security Administration ("TSA").

1.0 AUTHORITY

TSA enters into this Agreement under the authority of the Title IV, Public Law
No. 108-11 (hereinafter P.L. 108-11), the Emergency Wartime Supplemental
Appropriations Act, 2003, (hereinafter Act), which requires the execution and
delivery of this Agreement as a condition to the remittance of the funds
provided for in the second proviso of Title IV, P.L. 108-11, except for any air
carrier that operates aircraft exclusively with 85 seats or less, any
Hawaii-based carrier or any carrier that does not operate trans-Pacific or
trans-Atlantic flights. Air Carriers that would be exempted from the requirement
to execute and deliver this Agreement but for the operation of private charter
flights, including flights provided to the United States under the Civil Reserve
Air Fleet (CRAF), for which no fees were incurred pursuant to 49 U.S.C. Section
44940(a) for these flights, shall not be required to execute and deliver this
Agreement solely because of those flights for which no fees were incurred.

2.0 PURPOSE

This Agreement describes the terms and conditions to which the Air Carrier must
agree to be eligible for remittance of the funds provided for in the second
proviso of Title IV, P.L. 108-11.

3.0 DEFINITIONS

3.1 "Excluded Compensation" means award of stock, stock options, preexisting
contracts governing retirement, health benefits, life insurance benefits, and
reimbursement of reasonable expenses to an executive officer. Awards of stock
and stock options shall include related granting, vesting, issuance, exercise
and sale events.

3.2 "Executive Officer" means the two most highly compensated named executive
officers (as that term is used in section 402(a)(3) of Regulation S-K
promulgated by the Securities and Exchange Commission under the Securities and
Exchange Act of 1934 (17 C.F.R. Section 229.402(a)(3)). For the purposes of
applying this Agreement to an executive officer-

(A) who was employed by Air Carrier for less than 12 months during Air Carrier's
fiscal year 2002, or whose employment began after the last day of the last
fiscal year of such Air Carrier ending before the date of enactment of P.L.
108-11,

(i) the salary paid to that executive officer in Air Carrier's fiscal year 2002,
or in the next fiscal year of Air Carrier (if such next fiscal year began before
the date of enactment of P.L. 108-11), respectively, shall be determined as an
annual rate of pay;

(ii) that annual rate of pay shall be treated as if it were the annual salary
paid to that executive officer during Air Carrier's fiscal year 2002; and

(iii) that executive officer shall be deemed to have been employed during that
fiscal year; and

(B) whose employment begins after the date of enactment of P.L. 108-11-

(i) the annual salary at which that executive officer is first employed by Air
Carrier may not exceed the maximum salary paid to any executive officer by Air
Carrier during Air Carrier's fiscal year 2002 with the same or similar
responsibilities;

(ii) that salary shall be treated as if it were the annual salary paid to the
executive officer during Air Carrier's fiscal year 2002; and

(iii) the executive officer shall be deemed to have been employed by Air Carrier
during Air Carrier's fiscal year 2002.

For purposes of (A) above, an employee promoted to a position during the Air
Carrier's fiscal year 2002 shall be treated as first employed by the Air Carrier
on the date of such promotion.

3.3 "Operates" means currently operating or did operate between February 1, 2002
and April 16, 2003.

3.4 "Salary" means the base salary of an individual, excluding any bonuses,
awards of stock or other financial benefits provided by an air carrier to the
individual.

3.5 "Total Cash Compensation" has the meaning given the term "total
compensation" by section 104(b) of the Air Transportation Safety and System
Stabilization Act, Public Law No. 107-42 (49 U.S.C. Section 40101 note), but
does not include awards of stock or stock options or preexisting contracts
governing retirement. More specifically, "Total Cash Compensation" for purposes
of this Agreement shall mean any compensation, other than Excluded Compensation
as defined above, provided (including any amounts paid in cash during the
12-month period beginning April 1, 2003 that were earned in prior periods and
any amounts which would have been paid but which were deferred) by the Air
Carrier, including all of its holding companies, subsidiaries, and affiliated
entities, as follows:

(a) Salary;

(b) Bonus;

(c) Employer contributions under any retirement plan (excluding preexisting
plans or contracts related to retirement);

(d) Perquisites, including personal automobile allowances, positive space travel
benefits and any associated tax gross-ups, valued in a manner consistent with
the valuation of such perquisites for purposes of reporting such perquisites in
Air Carrier's proxy statement for its annual meeting of stockholders (except
that the reporting threshold of $50,000 or 10% of the annual salary and bonus
described in 17 C.F.R. Paragraph 229.402(b)(1)(C)(1) shall not apply to the
Agreement);

(e) Any other compensation required to be disclosed in the Air Carrier's proxy
statement for its annual meeting of stockholders that is paid (including amounts
paid during the 12-month period beginning April 1, 2003 that were earned in
prior periods) during the 12 month period beginning April 1, 2003, including but
not limited to any cash long-term incentive plan payouts; and

(f) Other financial benefits, reasonably valued by the good faith determination
of the Compensation Committee of the Board of Directors of Air Carrier,
excluding Excluded Compensation.

3.6 "Total compensation" as defined by section 104(b) of the Air Transportation
Safety and System Stabilization Act, includes salary, bonuses, awards of stock,
and other financial benefits provided by an air carrier to an officer or
employee of the Air Carrier.

3.7 "Trans-Atlantic" means from one side of the Atlantic Ocean to the other
side, with or without intermediate stops. It does not include flights that
solely travel between the United States and the Caribbean or between North
America and South America. "Trans-Pacific" means from one side of the Pacific
Ocean to the other side, with or without intermediate stops.

4.0 RESTRICTIONS ON COMPENSATION

4.1 The Air Carrier, including all of its holding companies, subsidiaries, and
affiliated entities, agrees that it will not provide Total Cash Compensation
during the 12-month period beginning April 1, 2003, to an executive officer in
an amount equal to more than the annual Salary paid to that officer with respect
to the Air Carrier's fiscal year 2002; and

4.2 If the Air Carrier violates the agreement under paragraph 4.1, Air Carrier
will pay to the Secretary of the Treasury, within 60 days after the date on
which the violation occurs, an amount, determined by the Administrator of the
Transportation Security Administration, equal to the total amount of assistance
received by Air Carrier pursuant to the second proviso of Title IV, P.L. 108-11.

4.3 Nothing in this Agreement shall be construed to prohibit or limit an air
carrier in providing health benefits, life insurance benefits, or reimbursement
of reasonable expenses to an executive officer as provided in P.L. 108-11.

5.0 COMPTROLLER GENERAL AUDIT AND EXAMINATION

The Air Carrier agrees that the Comptroller General of the United States, or any
of the Comptroller General's duly authorized representatives, shall have access
for the purpose of audit and examination to any books, accounts, documents,
papers, and records of the Air Carrier, including all of its holding companies,
subsidiaries, and affiliated entities, that relate to the information required
to implement the provisions of this Executive Compensation Agreement.

6.0 REPRESENTATIONS

6.1 That the Air Carrier is duly incorporated, validly existing and in good
standing under the laws of the State of Delaware.

6.2 The execution, delivery, and performance by the Air Carrier of this
Agreement has been duly authorized by all necessary corporate action; this
Agreement has been duly executed and delivered by the Air Carrier; and when
executed and delivered by a duly authorized representative of TSA, will
constitute a valid and binding obligation of the Air Carrier, enforceable
against it in accordance with its terms.

6.3 No authorization, approval, consent or order of any court or governmental
authority or agency or any other person or entity is required in connection with
the execution and delivery by the Air Carrier of this Agreement or its
performance hereunder.

7.0 NOTICES

The Air Carrier shall have the obligation to notify TSA no later than ten (10)
working days, following the occurrence of any event that constitutes a breach of
this Agreement. All notices required or permitted hereunder shall be in writing
and shall be deemed effectively given: (1) upon personal delivery to the party
to be identified below, (2) when sent by confirmed electronic mail or facsimile
if sent during normal business hours of the recipient; if not, then on the next
business day, (3) five days after having been sent by registered or certified
mail, return receipt requested, postage prepaid, or (4) one day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the
party to be notified at the address as set forth below or at such other address
as such party may designate by ten days advance written notice to the other
parties hereto.

If to AIR CARRIER:

If to TSA

:

Continental Airlines, Inc.

1600 Smith, Dept. HQSLG

Houston, TX 77002

Attn: General Counsel

(713) 324-5207

_Howard_Kass

_Director, Economic and Regulatory Policy

701 12th Street South, 11th Floor North, TSA-9

Arlington, VA 22202

(571) 227-2627/howard.kass@dhs.gov

8.0 GOVERNING LAW

This Agreement is governed by and shall be construed in accordance with Federal
law.

9.0 SUCCESSORS AND ASSIGNS BOUND BY COVENANTS

This Agreement shall bind, and inure to the benefit of the parties and their
respective heirs, executors, administrators, successors, and assigns.

10.0 SEVERABILITY

In the event any term, covenant, condition or provision of this Agreement is
held to be invalid by any court or tribunal of competent jurisdiction, the
invalidity of any such covenant, condition or provision shall in no way affect
any other covenant, condition or provision herein contained.

11.0 AMENDMENT

This Agreement may not be amended, discharged or terminated without the written
consent of the parties hereto, and no provision hereof may be waived without the
written consent of the Administrator of the Transportation Security
Administration.

12.0 INTEGRATED AGREEMENT

This Agreement, upon execution, contains the entire agreement of the parties,
and no prior written or oral agreement, express or implied, shall be admissible
to contradict the provisions of this Agreement. There may exist other agreements
between the Parties as to other matters, which are not affected by this
Agreement and are not included within this integration clause.

13.0 WAIVER

No failure by either party to insist upon the strict performance of any
provision of this Agreement or to exercise any right or remedy consequent upon a
breach thereof, and no acceptance of full or partial assistance payments (if
applicable) or other performance by either party during the continuance of any
such breach shall constitute a waiver of any such breach of such provision.

 

14.0 COUNTERPARTS

This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.

IN WITNESS WHEREOF, the parties have entered into this Agreement by their duly
authorized officers the day and year first above written.

   

AIR CARRIER

 

By:

Witness

 

Name: Jeffery A. Smisek

Position: Executive Vice President

     

   

TSA

 

By:

Witness

Name: ______________________________

Position: _________________________________