SPACE AND USE AGREEMENT


Continental Airlines, Inc.  ("CONTINENTAL"),  by its execution of this Space and
Use  Agreement  ("The  Agreement"),  grants  to  Frontier  Airlines,  Inc.  (the
COMPANY"),  under the terms and  conditions  stated  herein,  certain rights and
privileges,  including the right to occupy and use the space  referred to herein
as the "PREMISES."

COMPANY,  by its execution hereof,  hereby accepts and receives the PREMISES and
the obligations,  liabilities and responsibilities  provided for herein. COMPANY
covenants  and  agrees to abide by and carry out all the terms,  conditions  and
provisions  hereof.  "COMPANY,"  as used herein,  shall  include,  unless stated
otherwise, the directors, officers, employees, agents, customers and invitees of
COMPANY and all parties representing  COMPANY,  those for whom COMPANY is liable
and responsible, and all parties represented by COMPANY.

1.  EFFECTIVE DATE             January 1, 1999

2.  COMPANY:  The name,  address  and  telephone  number of the  COMPANY  are as
follows:

     NAME:                 Frontier Airlines, Inc.

     ADDRESS:              12015 East 46th Avenue
                           Denver, CO 80239

     TELEPHONE:            303-371-7400

     ATTENTION:            Joan Osterman

3.   DESCRIPTION OF PREMISES:  Certain maintenance hangar space (approx.  59,706
     sq.  ft.)  within  the  Denver  International  Airport,  being  more  fully
     described  on  Exhibit  A,  attached  hereto and made a part of, as well as
     reasonable right of ingress and egress.

4.   USE OF PREMISES: COMPANY is hereby granted the right to use the PREMESISES,
     in  accordance  with  the  terms  and  conditions  stated  herein,  for the
     following purposes:

     Exclusion  use of the PREMISES  (Exhibit A) for the purpose of  maintenance
     space in accordance  with the terms and conditions of this  Agreement,  and
     for no other purpose. Company is permitted, on a space available basis, the
     common use of training rooms, break rooms, locker  room/restrooms,  loading
     dock, parking areas, and a pro-rata share of apron space.

5.   PROPERTY  OWNER:  City and County of  Denver,  hereinafter  referred  to as
     "OWNER,"  has granted to  CONTINENTAL,  the right to use the  PREMISES  and
     certain other rights and privileges under the following Lease,  hereinafter
     referred to as the "BASE LEASE":

         Lessor:  City and County of Denver

         Lessee:  Continental Airlines, Inc.

         Dated:   January 8, 1993

CONTINENTAL  warrants and represents that as of the date hereof,  the BASE LEASE
is in full force and effect.

6.   CONSIDERATION/RENTAL:   In   consideration   for  the  rights   granted  by
     CONTINENTAL  hereby,  COMPANY,  agrees  to pay  $1,200,000.00  annually  to
     Continental Airlines,  Inc., in monthly installments of $100,000.00 paid in
     advance on the first day of each calendar month.  COMPANY further agrees to
     pay as  additional  rental any increases in rental  charges to  CONTINENTAL
     under the BASE LEASE or any amendments thereto.  Payment shall be delivered
     to CONTINENTAL at:

         CONTINENTAL AIRLINES, INC
         CREDIT MANAGEMENT
         P.O. BOX 100023
         HOUSTON, TX 77212
         ATTENTION: OUTSIDE SALES & SERVICE - DEN Hangar Sublease

7.   TERM:  This  Agreement  shall  commence  January 1, 1999 and shall continue
     through January 1, 2004, unless otherwise terminated in accordance with the
     terms and  provisions  hereof.  Either party hereto shall have the right to
     terminate  this  Agreement  without  cause at any time by giving  the other
     party  three  hundred  sixty-five  (365) days prior  written  notice of its
     intention to do so. If, at the  expiration  of the Term,  COMPANY  fails to
     vacate the PREMISES,  then COMPANY shall be deemed a holdover tenant on all
     of the  terms  and  conditions  of this  Agreement  (except  that,  without
     limiting the rights  provided to  CONTINENTAL  under this  Agreement  for a
     breach by  COMPANY,  the  monthly  rental  payable by COMPANY  shall be two
     hundred  percent  (200%) of the  monthly  rent  provided  for  herein)  and
     CONTINENTAL  reserves the right to evict COMPANY without further process of
     law.

8.   NOTICE:  unless  expressly  required or  permitted  herein to be oral,  all
     notices,  requests,  consents and  approvals  required to be given to or by
     either  party shall be in  writing,  and shall be  transmitted  either by a
     commonly  recognized  national  delivery  service or  deposited as prepaid,
     certified,  registered or express  United States mail addressed as follows,
     or to the last address provided in accordance herewith:

TO CONTINENTAL:                                      TO COMPANY:

Vice President                                       Frontier Airlines, Inc.
Corporate Real Estate                                Properties & Facilities
Continental Airlines, Inc.                           12015 East 46th Avenue
1600 Smith St. - Dept. HQSPF                         Denver, CO 80239
Houston, TX 77002

9.   SECURITY  DEPOSIT:  Concurrently  with  the  execution  of this  Agreement,
     COMPANY shall deliver to CONTINENTAL,  as a Security Deposit,  $100,000.00,
     which amount may be commingled  with other funds  belonging to  CONTINENTAL
     and shall bear no  interest.  After a default by COMPANY,  CONTINENTAL  may
     apply any or all of the  Security  Deposit to cure such default as provided
     in Section 17 hereof.

10.  ADDITIONAL RENTAL/CHARGES/FEES:

A)       The  COMPANY  shall be  solely  responsible  for and shall pay when due
         directly to the OWNER any and all fees, assessments,  taxes and charges
         of  any  kind   whatsoever   assessed  in  connection   with  COMPANY'S
         operations,  including  but not  limited  to any  applicable  taxes and
         property facility charges.

11.  INSURANCE COVERAGE REQUIREMENTS:

Without limiting COMPANY's  obligation to indemnify  CONTINENTAL as provided for
in this Agreement,  COMPANY shall procure and maintain,  at its own cost, at all
times during the term of this Agreement, insurance of the following types and in
amounts not less than those indicated, with responsible insurers satisfactory to
CONTINENTAL providing the following coverage:


                                   DESCRIPTION


A.       Aviation and Comprehensive General             Per Occurrence and with
         Liability to include operations and            aggregate as applicable:
         Premises Liability                             $1,000,000,000* combined
                                                        single  limits covering
                                                        bodily injury,  property
                                                        damage

                                                    *or COMPANY limits if higher

B.       Worker's Compensation                                Statutory

C.       Employer's Liability                                 $1,000,000


12.  SPECAIL  PROVISIONS:  a) CONTINENTAL will use reasonable efforts to provide
     janitorial,  maintenance,  and utility services for the common use PREMISES
     (with exception to gas and electricity to entire PREMISES),  but should not
     be held  liable if such  services  are  interrupted  from time to time.  b)
     COMPANY will be solely responsible for the cost of all tenant improvements.
     All tenant  improvements  are subjects to the prior written  consent of the
     Vice President, Corporate Real Estate.

13.  BAILMENT
During the term of this Agreement,  an employee or agent of COMPANY shall at all
times be in charge of and in  custody  and  control  of all  aircraft  and other
property  belonging to or in the control of COMPANY on or in the vicinity of the
PREMISES,  and the parties  hereby  stipulate and agree that this agreement does
not confer upon  CONTINENTAL  any control over or  obligation  of bailment  with
respect to any  aircraft or other  equipment  owned or operated by COMPANY,  and
does not subject CONTINENTAL to any of the liabilities of an OWNER, user, lessor
or operator of any aircraft or other equipment owned or operated by COMPANY.

14.  SUBJECT TO BASE LEASE

COMPANY covenants and agrees,  for the benefit of CONTINENTAL and OWNER, that it
shall  not,  by its  use  and  occupancy  of the  PREMISES,  violate  any of the
provisions of the BASE LEASE as such BASE LEASE has been and/or may from time to
time be amended,  or cause  CONTINENTAL  to be in default  thereof,  and that it
shall  faithfully  perform and discharge all of the  obligations  of CONTINENTAL
(except  for payment of rental)  thereunder,  to the extent that such BASE LEASE
terms are applicable to the PREMISES or this Agreement COMPANY further covenants
that this Agreement  shall be, in all respects,  subject and  subordinate to the
BASE LEASE,  and any  mortgages  or other lien  instruments  that may affect the
PREMISES  or  CONTINENTAL'S  interest  therein,  and nothing  contained  in this
Agreement shall be deemed to confer upon COMPANY any right which are not granted
by or are in conflict with the BASE LEASE. Not withstanding  anything  contained
herein,  (a) this  Agreement  shall not be deemed  to grant to the  COMPANY  any
rights or privileges  which  CONTINENTAL does not have under the BASE LEASE, and
(b) any act or  omission  of  CONTINENTAL  require by the BASE LEASE shall in no
event be deemed a violation of this Agreement.

15.  ACCEPTANCE OF PREMISES

COMPANY HAS INSPECTED THE PREMISES AND ACKNOWLEDGES THAT CONTINENTAL HAS MADE NO
REPRENSENTATIONS  AS TO THE CONDITION  THEREOF.  COMPANY ACCEPTS THE PREMISES IN
ITS PRESENT  CONDITION,  AS-IS,  WITH ALL FAULTS,  LATENT OR KNOWN.  CONTINENTAL
MAKES NO WARRANTIES,  GUARANTEES OR  REPRENSENTAIONS OF ANY KIND, EITHER EXPRESS
OR IMPLIED,  ARISING BY LAW OR OTHERWISE,  PERTAINING  TO THIS  AGREEMENT OR THE
PROPERTY  DESCRIBED  HEREIN.  COMPANY  HEREBY WAIVES AND  CONTINENTAL  EXPRESSLY
DISCLAIMS ALL WARRANTIES,  GUARANTEES AND  REPRESENTATIONS,  EXPRESS OR IMPLIED,
ARISING BY LAW OR OTHERWISE,  INCLUDING  NUT NOT LIMITING THE  GENERALITY OF THE
FOREGOING, ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE OR REGARDING
THE CONDITION OF THE PROPERTY. IN NO EVENT SHALL CONTINENTAL=S  LIABILITY OF ANY
KIND UNDER THIS  AGREEMENT  INCLUDE ANY SPECIAL,  INCIDENTAL,  CONSEQUENTIAL  OR
EXEMPLARY DAMAGES EVEN IF CONTINENTAL SHALL HAVE BEEN ADVISED OF THE POSSIBILITY
OF POTENTIAL LOSS OR DAMAGE.

16.  PAYMENTS

If the term of this  Agreement  shall  commence or end on any day other than the
first and last day, respectively, of a calendar month, the consideration due for
a portion  of a month  shall be  prorated  on a  per-diem  basis,  and the first
payment shall be due on or before the effective date hereof.

Any unpaid or past due amounts shall bear interest from the date due until paid,
at 1-1/2% per month, or, at CONTINENTAL's  option, the maximum rate allowable by
law, which interest shall be considered as part of the rental payable hereunder.
Acceptance by Continental  of any partial  payment,  including  endorsement of a
check,  shall not be deemed to be an accord and  satisfaction.  Continental  may
accept  such check or payment  without  prejudice  to it's right to recover  the
balance due or to pursue any other remedy available to it.

17.  USE OF SECURITY DEPOSIT

A.   If at any time  during the term of this  Agreement,  any of the rent herein
     reserved, or any other amounts due from COMPANY shall be overdue or unpaid,
     or in the event of failure by COMPANY to keep and perform any of the terms,
     covenants  and  conditions  of this  Agreement to be kept and  performed by
     COMPANY,  then  CONTINTENTAL,  at its option, may appropriate and apply the
     entire Security Deposit,  or any portion thereof (I) to the payment of such
     overdue  amounts,  and (ii) as  compensation to CONTINENTAL for any loss or
     damage  sustained or suffered by CONTINENTAL due to such breach on the part
     of  COMPANY.  Should  CONTINENTAL  withdraw  any amount  from the  Security
     Deposit as  provided  herein,  COMPANY  shall  remit to  CONTINENTAL,  upon
     written  demand  therefor,  an amount  sufficient  to fully  replenish  the
     Security Deposit.

B.   COMPANY'S  failure to remit any  increase in, or any  replenishment  of the
     Security  Deposit,  as  required  herein,  within  five (5) days of written
     notice  of funds  due,  shall  constitute  a default  hereunder,  entitling
     CONTINENTAL to immediately  invoke the remedies  available to it by law and
     this Agreement, including immediate termination of this Agreement.

C.   Within  thirty  (30) days after  expiration  or other  termination  of this
     Agreement,  and upon vacation of the PREMISES and  satisfaction  of any and
     all events of default by COMPANY,  including payment of all amounts due and
     past due, the Security Deposit shall be returned in full to COMPANY.

D.   In  the  event  any  bankruptcy,   insolvency,   reorganization   or  other
     creditor-debtor  proceedings shall be instituted by or against COMPANY, the
     Security  Deposit  shall be deemed to be applied  first to any rents and/or
     other charges due  CONTINENTAL  for all periods prior to the institution of
     such  proceedings,  and the  balance,  if any, of  Security  Deposit may be
     retained by CONTINENTAL in partial liquidation of CONTINENTAL'S damages.

E.   COMPANY  covenants  and  agrees  that it shall not  assign or  encumber a r
     attempt to assign or encumber the Security  Deposit,  and that  CONTINENTAL
     shall not be bound by any such assignment, encumbrance or attempt to assign
     or encumber.

18.  UTILITIES

CONTINENTAL shall furnish the PREMISES with utilities and services to the extent
that they are furnished to Continental  under the BASE LEASE.  Continental shall
not be liable for, and COMPANY  hereby  releases  and waives any claims  against
CONTINENTAL resulting from any failure or interruption of such services. COMPANY
shall pay Continental, as additional rent, for any extraordinary electrical, gas
or water consumption, and any utility costs attributed to equipment installed by
COMPANY.

19.  CONDUCT AND WASTE

COMPANY, in its use of the PREMISES, covenants and agrees that it shall:

A.   Conduct its operations in an orderly and proper  manner.  COMPANY shall not
     create,  generate or permit the creation or generation  of vibrations  that
     might tend to damage the  PREMISES;  loud  noises;  the  emission of steam,
     gases or unpleasant or noxious odors;  nor in any manner annoy,  disturb or
     be offensive to other tenants of the PREMISES and common areas.

B.   Be  responsible  for the conduct,  appearance and behavior of its officers,
     employees,  agents,  contractors,  customers  and  invitees  on  and in the
     vicinity of the PREMISES,  and upon  objection  from  CONTINENTAL or OWNER,
     shall   immediately   make  every   reasonable   effort  to  eliminate  any
     unsatisfactory conduct, appearance or behavior.

C.   Not allow garbage,  debris or other waste materials (whether solid,  liquid
     or gaseous) to collect or  accumulate on or in the PREMISES or in access or
     service areas.  COMPANY shall remove debris and other waste  materials form
     the PREMISES in accordance with all applicable  regulations  governing such
     activity. COMPANY shall keep all lobbies,  vestibules and steps with in the
     PREMISES free from dirt and rubbish.

D.   It is intended that the standards and  obligations  imposed by this section
     shall be  maintained  and  complied  with by  COMPANY  in  addition  to its
     compliance  with any  present  and  future  governmental  laws,  rules  and
     regulations.

20.  SECURITY

COMPANY shall adopt and enforce appropriate  procedures to prevent  unauthorized
access  to  CONTINENTAL'S  operations  areas  and  aircraft,  on the part of its
passengers,  employees,  vendors,  licenses, and invitees. Such procedures shall
include,  without limitation, a requirement that all COMPANY's employees visibly
display a photographic  identification  badge on their person at all times while
within  an area  covered  by this  Agreement  which is not  open to the  general
public,  and a requirement that all passengers and other persons who are present
in such an area be in the COMPANY  of, and  escorted  by, a properly  identified
employee  of  COMPANY.  COMPANY  further  agrees to  indemnify,  defend and hold
CONTINENTAL  harmless  with  respect to any fine,  levy or penalty  which may be
imposed upon  CONTINENTAL by the Federal  Aviation  Administration  or any other
government  authority  for  violation  of any law or  regulation  pertaining  to
aircraft  or airport  security as a result of ant act or omission on the part of
COMPANY,  such  indemnity  to include  all  attorney's  fees and other  costs of
defense incurred in connection therewith.

21.  GOVERNMENTAL REQUIREMENTS

COMPANY covenants and agrees, at its sole expense, including payment of fees and
deposits, to procure from all governing authorities asserting  jurisdiction over
the  operations  of  COMPANY,  all  licenses,  certificates,  permits  or  other
authorization which may be necessary for the conduct of its operations.  COMPANY
shall at all times promptly  observe,  comply with and execute the provisions of
any  and  all  present  and  future  federal,   state  and  local  laws.  Rules,
regulations,  requirements,  orders and directions which may pertain or apply to
the operations of COMPANY and its occupancy of the PREMISES.

22.  RULES, REGULATIONS AND ADMINISTRATION

COMPANY shall be responsible for initiating,  maintaining and supervising safety
precautions  and programs  necessary to prevent  injury to persons and damage to
property in, on or about the  PREMISSES,  and shall observe and obey all present
and future rules and regulations issued by CONTINENTAL and OWNER for the conduct
of tenants and  subtenants at the  PREMISES,  including but not limited to those
regulating preservation and security of the PREMISES.

23.  MAINTENANCE AND REPAIRS

A.   Any  construction,  addition to, or alteration of the PREMISES  required by
     COMPANY  shall be made by COMPANY at its sole cost and  expense,  only upon
     prior  written  approval by  CONTINENTAL,  and if  required  under the BASE
     LEASE,  OWNER, and shall, upon expiration or termination of this Agreement,
     at  CONTINENTAL's  option,  be  promptly  removed,  with any damage  caused
     thereby repaired, at COMPANY's sole cost and expense.
B.   COMPANY  covenants  and agrees to maintain the  PREMISES,  and shall at its
     sole cost and  expense,  make any  installations,  non-structural  repairs,
     replacements,  redecorating  and other  maintenance  necessary  to keep the
     PREMISES, and all equipment,  fixtures, furnishings and signs therein, in a
     clean, neat and orderly condition, save and except (I) normal wear and tear
     that could not have been prevented by,  reasonable  repair and maintenance;
     and (ii) damage by fire or other  casualty  and acts of God or other events
     of Force Majeure.  All  maintenance  and repair work  undertaken by COMPANY
     shall be performed in a good and  workmanlike  manner,  in accordance  with
     standards  of the  facility  and of a quality and class not inferior to the
     original  material and workmanship,  leaving the PREMISES free of liens for
     labor and materials.
C.   In the event that,  within ten (10) days of receipt of written  notice from
     CONTINENTAL or OWNER that a repair is necessary,  COMPANY fails to commence
     and  diligently  continue to complete  such  repair,  CONTINENTAL,  without
     obligation  to do so, may make such  repair,  and  COMPANY  shall  promptly
     reimburse CONTINENTAL for all costs and expenses incurred thereby.

D.   COMPANY  covenants  and agrees to  maintain  the  PREMISES  and conduct its
     operations  in such a manner  that at no time  shall it do or  permit to be
     done any act or thing in, on or in the vicinity of the PREMISES  which will
     invalidate  or  conflict  with  any fire and  casualty  insurance  policies
     covering the PREMISES, or any part thereof, or which may create a hazardous
     condition  or  otherwise  increase  the risk  normally  attendant  upon the
     operations  contemplated  hereunder.  COMPANY  shall  promptly  observe and
     comply  with all present and future  rules,  regulations  and orders of the
     Fire Underwriters  Association or of any other board or organization  which
     may exercise similar functions.

E.   Any  increase  in fire  or  casualty  insurance  premiums  attributable  to
     COMPANY's  acts or  omissions  under  this  Agreement,  shall  be  promptly
     reimbursed by COMPANY, upon receipt of CONTINENTAL's and/or OWNER's invoice
     therefor.

24.  SURRENDER

Upon  expiration or other  termination of this Agreement in accordance  with the
provisions herein,  COMPANY shall remove all signs, trade fixtures and any other
personal  property,  repair all damage  caused by  removal,  and  surrender  the
PREMISES in the clean, neat and orderly condition  required herein. In the event
COMPANY  fails to surrender  possessions  as required  herein,  CONTINENTAL  may
reenter and repossess the PREMISES without further notice, any personal property
therein being deemed abandoned by COMPANY.  COMPANY hereby waives service of any
notice of  intention  to  reenter  and right to redeem  that may be  granted  by
applicable law.

25.  RIGHT OF ENTRY

CONTINENTAL  reserves  the right for itself and OWNER to enter upon the PREMISES
at any time during an  emergency  to take such action as may be required for the
protection  of  persons  and  property,  and for any other  reasonable  purpose,
including without limitation,  as access to and egress from areas other than the
PREMISES,  and to perform such functions as may be necessary for the maintenance
and  operation  of  the  PREMISES,  for  inspection,  repairs,  alterations  and
improvements,  and showing to  prospective  tenants.  Such activity shall not be
cause for abatement of any amount  payable to  CONTINENTAL  by COMPANY,  and the
term of this  Agreement  shall not  thereby  extend.  CONTINENTAL  shall  make a
reasonable effort to minimize interference with COMPANY's operations during such
activity.

26.  TAXES AND FEES

COMPANY agrees to pay,  before they become  delinquent,  all taxes (both general
and  special),  and all  assessments,  fees and charges of any kind  whatsoever,
levied or assessed  against the leasehold estate created hereby in the PREMISES,
any property of COMPANY located thereon,  and any business  conducted by COMPANY
thereon. COMPANY agrees to use its best efforts to cause the leasehold estate in
the PREMISES,  and its personal property and business  operations to be assessed
and  taxed  separately  from the BASE  LEASE  and the  PREMISES.  On  demand  by
CONTINENTAL,  COMPANY shall furnish CONTINENTAL with satisfactory  evidence that
such  payments  required  from  COMPANY  have  been  made.  In  the  event  that
Continental shall be assessed any taxes or fees relative to the leasehold estate
in  the  PREMISES  or  any  of  COMPANY's  leasehold  improvements,   equipment,
furniture,  fixtures,  personal property or business  operations,  COMPANY shall
reimburse  such amount to  CONTINENTAL  within five (5) days after  receipt of a
written statement thereof.

27.  FORCE MAJEURE

Notwithstanding  anything to the contrary herein contained,  neither party shall
be deemed in violation of this Agreement if it is prevented from  performing any
of its obligations  hereunder,  except making rental and any other payments due,
by any labor or industrial  dispute;  civil  disturbance;  vandalism or act of a
public enemy;  shortage of labor, energy or material;  court order,  regulation,
action or non-action of any governmental authority;  weather condition;  natural
disaster;  act of God; or other  circumstance not reasonably within its control,
and  which,  with the  exercise  of due  diligence,  it is unable  to  overcome;
provided,  however,  that  nothing in this  Section 27 shall extend the time for
performance  by  COMPANY  unless  the time for  performance  by  CONTINENTAL  is
extended for such reason  under the BASE LEASE.  Each party shall give the other
immediate  notice of such  interruption,  shall make all  reasonable  efforts to
eliminate  it  as  soon  as  possible,  and  at  its  conclusion,  shall  resume
performance in accordance with its obligations hereunder. Neither party shall be
required  by the  foregoing  to settle or  compromise  any strike or other labor
dispute.

28.  RELATIONSHIP

The  relationship  between COMPANY and CONTINENTAL  shall be that of independent
contractor  for all purposes and nothing  herein shall be construed to create or
imply  an  employer/employee,   agency,  partnership,  joint  venture  or  other
relationship,  it being  acknowledged that each of the parties is engaged in its
own separate and  distinct  business,  and is not under the control of the other
party in the performance of the agreements herein contained.  No person employed
by either  shall be held or  construed  to be an  employee or agent of the other
under any circumstances.  Each party assumes full responsibility for any and all
liability  to its own  employees  on  account  of  injury,  or  death  resulting
therefrom, sustained in the course of their employment. Each party, with respect
to its own  employees,  accepts  full and  exclusive  liability  for  payment of
Workers'  Compensation and employer's  liability insurance premiums with respect
to such employees, and for payment of all taxes, contributions or other payments
for unemployment compensation or old age benefits, pensions, or annuities now or
hereafter  imposed upon employers by any government or agency thereof  asserting
jurisdiction  in  respect of such  employees  measured  by the wages,  salaries,
compensation or other  remuneration  paid to such employees,  and agrees to make
such  payments and to make and file all reports and returns and to do everything
necessary  to  comply  with the  laws  imposing  such  taxes,  contributions  or
payments.

29.  INDEMNIFICATION

A.       RELEASE

     COMPANY hereby covenants and agrees that, anything in this Agreement to the
     contrary notwithstanding,  CONTINENTAL shall not be liable for (a) any acts
     or omissions of, or for any condition  resulting  from,  the  operations or
     activities of any person, firm or corporation, or its officers,  directors,
     agents, employees, customers, invitees, vendors, or contractors relating to
     or arising out of this Agreement, or (b) any loss or damage to any property
     or the death or injury of any persons  (including  property of COMPANY,  or
     its officers, directors, employees, agents, customers, vendors, contractors
     or invitees).  Occasioned by theft,  fire acts of God, or any  governmental
     body or authority, injunction, riot, war, other tenants or the PREMISES, or
     any other  matter  beyond  the  control  of  CONTINENTAL,  or any damage or
     inconvenience  which  may  arise  through  repair,  or  alteration  of  the
     PREMISES, or failure to make repairs, or unavailability of utilities or for
     any cause whatsoever,  except the gross negligence or willful misconduct of
     CONTINENTAL.

B.       INDEMNITY

     Anything in this  Agreement  to the contrary  notwithstanding,  and without
     limiting  COMPANY's  obligation to provide insurance  pursuant to insurance
     provisions  herein,  COMPANY  covenants  and agrees that it shall  protect,
     indemnify,   defend  and  hold  harmless,   CONTINENTAL,   its  parent  and
     subsidiaries,  OWNER and their respective  predecessors and former, present
     and future directors,  officers,  employees, agents, successors and assigns
     (the  "Indemnitees"),  From and against all  liabilities,  losses  damages,
     penalties,  claims,  costs,  charges  and  expenses,  causes of action  and
     judgments of any nature whatsoever, including, without limitation, fees and
     disbursements  of  counsel  incurred  by any  Indemnitee  in any  action or
     proceeding  between COMPANY and any  Indemnitee,  or between any Indemnitee
     and any third party or  otherwise  which may be imposed upon or incurred by
     the  Indemnitees by reason or arising out of ant of the following  (even if
     caused by the ordinary  negligence of any Indemnitee,  but not if caused by
     the gross negligence or willful misconduct of the Indemnitees):

1)        Any occupancy,  management or use of the PREMISES,  or common areas or
          the service areas,  parking areas, or pedestrian areas in the vicinity
          of the PREMISES, by COMPNAY or any of its directors, officers, agents,
          contractors,  servants, employees, licensees, invitees, successors and
          assigns;

2)        Any act of  omission  of  COMPANY or any of its  directors,  officers,
          agents,  contractors,   servants,  employees,   licensees,   invitees,
          successors and assigns;

3)        Any  accident,  injury  to or death of any  person,  or  damage  to or
          destruction  of any  property  occurring  on or in the vicinity of the
          PREMISES   caused  by  COMPANY  or  any  of  its  employees,   agents,
          subcontractors  or  invitees,  including  but not limited to aircraft,
          interference with CONTINENTAL's operations, and loss of use;

4)        Any  failure  on  the  part  of  COMPANY  to  comply  with  any of the
          covenants,   agreements,   terms  or  conditions   contained  in  this
          Agreement,  the BASE LEASE or any law, rule, regulation,  requirement,
          order or directive for which it is responsible;

CONTINENTAL  shall promptly notify COMPANY of any such claim asserted against it
and forward  copies of all papers or legal process  served upon it in connection
with any action or proceeding  brought  against any  Indemnitee by reason of any
such claim.

C.       CITY HELD HARMLESS

     In addition to the provisions of Section 29 herein, Lessee shall indemnify,
     defend,  keep and hold  City,  including  Board  and the  City's  officers,
     agents,  servants,  and  employees,   harmless  from  any  and  all  costs,
     liability,  damage,  or  expense  (including  costs  of suit  and  fees and
     reasonable  expenses  of legal  services)  claimed  by  anyone by reason of
     injury  to or death of  persons  or damage to or  destruction  of  property
     including  property  of  Lessee,  sustained  in,  on, or about the  demised
     premises or arising  out of  Lessee's  use or  occupancy  thereof,  or as a
     proximate result of the acts or omissions of Lessee, its agents,  servants,
     or employees.


30.  ENVIRONMENTAL OPERATIONS

COMPANY covenants and agrees:

A.   That it shall not cause or permit any Hazardous Material to be brought upon
     the PREMISES  without the written  consent of  CONTINENTAL  and OWNER,  and
     shall  advise   CONTINENTAL   of  any  known  or  suspected   environmental
     contamination;

B.   That its operations shall at all times remain in compliance with:

1)        CONTINENTAL's  and  OWNER's  written  restrictions  and   requirements
          governing  the  identification  and  use  of  chemical  and  petroleum
          products;

2)        All orders and regulations promulgated by the Occupational, Safety and
          Health  Administration  and by the  Environmental  Protection  Agency,
          and all  other  federal,  state and  local  laws,  rules, regulations,
          requirements, orders and directive governing safety,  the  environment
          and hazardous and toxic substances;

C.   That it shall:

1)        secure  at  its  own  expense,  all  required  permits,  licenses  and
          authorizations necessary for such compliance;

2)        advise  CONTINENTAL  and  OWNER  of  any notice of potential or actual
          non-compliance;

3)        immediately upon receipt, provide CONTINENTAL and OWNER with copies of
          any notice or notices relating to non-compliance:

4)        allow  CONTINENTAL's   and  OWNER's   designated  representative   the
          unrestricted right to inspect and review  its on-premises   operations
          and  equipment.   Unless necessary  in an emergency situation, neither
          CONTINENTAL's nor OWNER's representatives shall purposefully interfere
          with or inhibit COMPANY's operation.

D.   That all notices,  copies and correspondence relating to this Section shall
     be delivered as described in the NOTICE  provision of this Agreement to the
     following  address,  or to any  address  subsequently  provided  by  proper
     notice.  Copies of such material shall be  hand-delivered  to CONTINENTAL's
     on-site representative upon request:

          Continental Airlines, Inc.
          Environmental Affairs
          2929 Allen Parkway, Suite 1401
          Houston, TX 77019

E.   As used herein,  the term  "Hazardous  Material"  includes  any  hazardous,
     explosive,  radioactive, or toxic substance, material, or waste which is or
     becomes regulated by any local governmental  authority,  the state in which
     the Sublease PREMISES is located or the United States,  including,  without
     limitation,  any material or substance  which is (a) defined or listed as a
     "hazardous  waste,"  "extremely  hazardous  waste,"  "restricted  hazardous
     waste,"  "Hazardous  substance,"  "hazardous  material,"   "pollutant,"  or
     "contaminant"   under  any  Law,  (b)  a   radioactive   material,   (c)  a
     polychlorinated  biphenyl,  (d) asbestos or an a asbestos  derivative,  (e)
     urea formaldehyde foam insulation, or (f) radon gas.

31.  INSURANCE ENDORSEMENTS

COMPANY  shall cause the  required  insurance  coverage to be duly and  properly
endorsed by it insurance underwriters to provide that:

A.   CONTINENTAL,  OWNER, and their respective officers,  directors,  agents and
     employees  are named as  additional  insured  thereunder  to the  extent of
     COMPANY's obligation to indemnify them under this Agreement,  where allowed
     by law.

B.   The policies shall include a standard cross liability clause.

C.   COMPANY's insurance shall be primary insurance and that any other insurance
     policy or policies of CONTINTENTAL and OWNER are noncontributory, secondary
     or excess insurance.

D.   COMPANY's policy  expressly insures COMPANY's contractual liability assumed
     by COMPANY under this Agreement.

E.   COMPANY's insurers waive all right of subrogation  against  CONTINENTAL and
     OWNER, and their respective directors,  officers,  agents and employees and
     their insurers.

F.   CONTINENTAL  shall  be  given thirty (30) days prior, written notice of any
     cancellation, or other material or adverse change.

G.   COMPANY's insurers agree that COMPANY's breach of any warranty set forth in
     its policy of insurance will not invalidate the insurance as to CONTINENTAL
     and OWNER.

Upon  execution  of  this  Agreement,   and  upon  any  reasonable   request  by
CONTINENTAL,  COMPANY shall forthwith supply  CONTINENTAL  with  certificates of
insurance  as evidence  of the  insurance  coverage  and  endorsements  required
herein.  COMPANY agrees that the terms of these  insurance  requirements  may be
revised,  and the minimum  coverages may be increased upon the written demand of
CONTINENTAL, which demand shall be based on reasonable and justifiable grounds.

32.  SURVIVAL OF TERMS

Termination of this Agreement or any part thereof by notice,  expiration of term
or  otherwise,  shall not  relieve  COMPANY of any  liabilities  or  obligations
accrued  on or  prior  to the  date  of  termination,  and the  indemnities  and
insurance  provisions contained or referred to herein shall remain in effect and
shall survive the expiration or other termination of this Agreement.

33.  TERMINATION

Without limiting any rights of CONTINENTAL to terminate this Agreement as may be
afforded by operation of law,  this  Agreement  shall also be  terminated at the
option of CONTINENTAL, as follows:

A.   Immediately  upon the  termination  or  expiration of the BASE LEASE or any
     portion thereof relating to the PREMISES, or upon expiration or termination
     of CONTINENTAL's  right to grant to COMPANY the right to occupy and use the
     PREMISES as contemplated herein, in which event COMPANY shall have no claim
     for the unexpired term hereof; provided, CONTINENTAL during the term hereof
     agrees to take no action which would cause expiration or termination of the
     BASE LEASE,  except that  CONTINENTAL  shall not be limited from exercising
     any option set forth in the BASE LEASE triggered upon the occurrence of any
     condemnation,  fire or other casualty to the PREMISES or to the BUILDING of
     which the PREMISES are a part.

B.   Immediately and without notice to COMPANY in the event that COMPNAY files a
     voluntary petition in bankruptcy or that proceedings in bankruptcy shall be
     instituted  against  COMPANY and not  dismissed  within one hundred  twenty
     (120)  days,  or that a court  shall take  jurisdiction  of COMPANUY or its
     assets pursuant to proceedings  brought under the provisions of any federal
     reorganization  act,  or that a  receiver  of  COMPANY's  assets  shall  be
     appointed  and such  taking or  appointment  shall not be stayed or vacated
     within a period of thirty (30) days.

C.   Immediately  upon written  notice to COMPANY,  if COMPANY  fails to pay any
     installment  of rent or  additional  rent  within  ten (10) days after such
     amount is due.

D.   Immediately  upon written  notice to COMPANY,  if COMPANY fails to perform,
     keep, and observe any the covenants,  terms and conditions which COMPANY is
     obligated  herein to perform,  keep and  observe,  except that  termination
     shall be stayed as long as  COMPANY  cannot  reasonably  cure such  default
     immediately,  and as long as COMPANY is diligently  proceeding to cure such
     default  (but in no event  shall  termination  be  stayed  for more than 60
     days).

E.   Immediately  by either party upon the  acquisition or  condemnation  of the
     PREMISES by eminent domain,  in which event COMPANY shall have no claim (I)
     for the unexpired  term hereof,  or (ii) any part of the award made for the
     PREMISES, but may claim any award or its personal property.

F.   Abandonment of the PREMISES by COMPANY for more than 48  hours,  unless due
     to circumstances beyond COMPANY's reasonable control.

In the event that this Agreement is terminated in accordance  with the foregoing
prior to the  expiration of the term hereof,  or during any  extension  thereof,
CONTINENTAL  may relet the PREMISES for any term and under any conditions it may
deem  satisfactory,  which  shall not  affect or impair  CONTINENTAL's  right to
recover actual damages occasioned by any default by COMPANY.

34.  NON-DISCRIMINATION AND EQUAL OPPORTUNITY

COMPANY,  for itself,  its successors in interest and assigns,  as a part of the
consideration  hereof, as a covenant running with the land, covenants and agrees
that it shall not  discriminate  by segregation or otherwise  against any person
the  use of  the  PREMISES,  or any  services.  Privileges,  accommodations,  or
activities provided by COMPANY,  and to be bound by and to perform in accordance
with all applicable provisions and requirements of all federal,  state and local
laws,  executive  orders and  regulations  issued  pursuant  thereto,  including
without  limitation,  and  to the  extent  applicable  to  this  Agreement,  the
provisions contained within:

A.   The Fair Labor Standards Act.

B.   The  Equal  Opportunity  clause  set  forth in 41 CFR  Parts  60-1 et seq.,
     pursuant to the  requirements  of Section 202 of Executive  Order 11246, as
     amended, and the implementing regulations of the Office of Federal Contract
     Compliance Programs.

C.   Contractual  requirements of the Rehabilitation Act of 1973 as set forth in
     41 CFR Sec 60-741.4;  and of the Vietnam Era Veterans  Readjustment  Act of
     1974 as set forth in 41 CFR Sec. 60-250.4.

D.   The requirements of the Occupational Safety and Health Act and  regulations
     issued thereunder;

E.   Titles I, II, III, IV, and V of the Americans with Disabilities Act of 1990
     As  the  foregoing  may  be  amended  or  replaced,  which  provisions  are
     incorporated  herein by reference as if set forth in full.  By execution of
     this  Agreement  each party  represents  and warrants  compliance  with the
     aforementioned regulations and will furnish proof thereof on demand.

F.   COMPANY  covenants  and  agrees  to  release,  indemnify, hold harmless and
     defend OWNER  and  CONTINENTAL,  its  parent  and  subsidiaries  and  their
     representative  directors,  officers,  employees,  agents,  successors  and
     assigns from and against any and all claims, liabilities, losses, expenses,
     damages, causes of action and judgment of any nature whatsoever,  including
     but not limited to reasonable attorney, consultant and expert  fees,  costs
     and related expenses; and including, but not limited to  clean-up  or other
     curative   measures   ordered   by   the   Occupational,  Safety and Health
     Administration or the Environmental Protection Agency or any other federal,
     state or local agency or entity asserting jurisdiction; arising out of  the
     discharge, disbursal, release orescape of any  hazardous  substance,  toxic
     chemical pollutant, contaminant or  irritant,  in solid, liquids or gaseous
     form, arising out of or in any manner connected with any act or omission of
     COMPANY  or  its  directors,  officers,  agents,   contractors,   servants,
     employees, licensees, invitees, successors and assigns.

G. COMPANY further covenants and agrees to:

1)        Indemnify  and defend  CONTINENTAL  and OWNER from and against any and
          all claims, liabilities, losses and judgments arising out of COMPANY's
          failure to comply with these provisions; and

2)        Include  and  require  inclusion of these provisions in all agreements
          regarding the PREMISES, including, without limitation, those   of  its
          contractors, subcontractors, successors and assigns.

35.  NON-DISCRIMINATION BREACH

In the event of any  breach of any of the  above  non-discrimination  covenants,
CONTINENTAL  shall have the right to terminate this Agreement and to reenter and
repossess  the PREMISES,  and hold the same as if this  Agreement had never been
made or issued.  This provision  shall not be effective  until the procedures of
Title  49,  CFR  Part 21 are  followed  and  completed,  including  exercise  or
expiration of appeal rights.

36.  SEVERABILITY

If any term or provision of this  Agreement  or the  application  thereof to any
person  or  circumstance   shall,  to  any  extent,   be  declared   invalid  or
unenforceable  by a court of competent  jurisdiction,  such invalidity shall not
affect or impair the remainder if this Agreement or its application to any other
person or  circumstance,  and this  Agreement  shall not be affected or impaired
under any  circumstance  or in any  jurisdiction  where such  provision  remains
valid.

37.  COLORADO LAW

THIS  AGREEMENTSHALL  BE CONTRUED AND  PERFORMANCE  THEREOF  SHALL BE DETERMINED
ACCORDING TO THE LAWS OF THE STATE OF COLORADO

38.  TIME IS OF THE ESSENCE

The parties  expressly  agree that time is the essence of this  Agreement and of
every provision hereof.  Failure by a party to complete  performance  within the
time  specified,  or within a reasonable  time if no time is  specified  herein,
shall,  without  prejudice of any other  rights or  remedies,  relieve the other
party of any obligation to accept such performance.

39.  QUIET ENJOYMENT

CONTINTENTAL  agrees that upon  payment of the rents and other  payment due, and
performance  of the  covenants  and  agreements  on the  part of  COMPANY  to be
performed hereunder, COMPANY shall peaceably have and enjoy the PREMISES subject
to an event of Force Majeure and to the terms and conditions herein.

40.  LIENS

COMPANY  shall not allow any  condition to exist o situation to develop  whereby
any party would be entitled, as a matter of law, to a lien against the PREMISES,
and agrees to indemnify, release, defend and hold CONTINENTAL and OWNER harmless
from and against any and all costs, expenses and claims arising therefrom.

41.  WAIVER

No waiver by either party at any time of any of the terms, conditions, covenants
or  agreements  herein or of any  forfeiture,  including  any delay,  failure or
omission of CONTINENTAL  to reenter the PREMISES,  shall be deemed to taken as a
waiver  at any  time  thereafter  of the  same  or any  other  term,  condition,
covenant,  or  agreement  herein  contained,   nor  of  the  strict  and  prompt
performance thereof. No notice shall be required to restore or revive any right,
power, privilege, option or remedy after waiver, and no right, power, privilege,
option or remedy  shall be construed as being  exhausted  or  discharged  by the
exercise thereof in one or more instances.  Each and all of the rights,  powers,
privileges,  options and remedies given to either party by this Agreement  shall
be  cumulative,  and no one of them shall be exclusive of the other or exclusive
of any remedies provided by law.--

42.  ASSIGNMENT

This  Agreement  and the rights and  obligations  created  hereunder  may not be
assigned  or  delegated  by  COMPANY   without  the  prior  written  consent  of
CONTINENTAL  and OWNER.  (If OWNER's  consent is required under the BASE LEASE);
but, subject to the foregoing,  this Agreement and the rights and obligations of
the parties  hereby  created,  shall be binding upon and inure to the benefit of
the   parties   hereto,   their   respective   successors,   assigns  and  legal
representatives.  CONTINENTAL  reserves  the  right to assign  or  transfer  its
interest hereunder without notice.

43.  CAPTIONS

The captions of the articles  and  sections of this  Agreement  are inserted for
convenience  only,  and are not intended and shall not be construed to affect in
any  manner  the  terms  and  conditions  hereof,  or  the   interpretations  or
construction thereof.

44.  APPROVAL BY OWNER

The  parties  hereto  agree that this  Agreement  is subject to the  consent and
approval of OWNER. If written  consent  thereto is denied,  either party may, at
its  option,  but without  limiting  any rights that may exist for any breach of
this  Agreement  shall  thereafter  become null and void,  and the parties shall
become discharged form all liabilities  hereunder  attributable to the period of
time after such rescission.

45.  ENTIRE AGREEMENT

This Agreement, including any exhibits and inclusions by reference, contains the
entire understanding  between the parties hereto, and supersedes and revokes all
previous  negotiations,  arrangements,  letters  in  intent,  offers,  proposals
representations,  and information conveyed,  whether oral or in writing, between
the parties hereto or their respective  representatives or any person purporting
to represent either.  COMPANY acknowledges that it has not been induced to enter
into this Agreement by any representation or construction of this Agreement, and
agrees that CONTINENTAL shall have no liability for any consequences  arising as
a result of such representation.


No amendment,  change or addition to this Agreement shall be binding upon either
party hereto unless in writing and signed by the parties  hereto and approved by
the Manager of Aviation.

WITNESS THEREOF, the parties hereto have caused this Agreement to be executed as
of the effective date hereof.

CONTINENTAL AIRLINES, INC.                  FRONTIER AIRLINES, INC.

BY:_________________________                         BY:_____________________

TITLE:______________________                         TITLE:__________________

DATE:______________________                          DATE:__________________

CITY AND COUNTY OF DNEVER

BY:_________________________

TITLE:______________________

DATE:______________________