<PAGE>
 
                                                                        EX 10.19

 
     CONFIDENTIAL TREATMENT HAS BEEN SOUGHT FOR PORTIONS OF THIS DOCUMENT 
  MARKED WITH " * " AND SUCH PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC

                            SPACE AND USE AGREEMENT
                            -----------------------

     Continental Airlines, Inc. ("CONTINENTAL"), by its execution of this Space
and Use Agreement ("the Agreement"), grants to Frontier Airlines, Inc.,
hereinafter referred to as "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," along with any improvements thereon.

     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.

1.   EFFECTIVE DATE:  March 2, 1995
     --------------                

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) 371-7000

     ATTENTION:     Arthur T. Voss
                    Vice President, Human Resources
                    & General Counsel

3.   DESCRIPTION OF PREMISES:  Certain space on and within the Denver
     -----------------------                                         
International Airport, as well as reasonable rights of ingress and egress and
the use of associated areas, being more fully described on Exhibits A - K,
attached hereto and made a part hereof.

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

A)   Commercial airline operations as granted to CONTINENTAL under the BASE
     LEASE.

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
<PAGE>
 
               Lessee:   Continental Airlines

               Dated:    January 1, 1993

6.   CONSIDERATION/RENTAL:  In consideration for the rights granted by
     --------------------                                             
CONTINENTAL hereby, COMPANY, agrees to pay to Continental Airlines, Inc., *
annually in twelve, equal monthly installments of * 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 and Continental agrees to
afford Company the benefit of any decreases in rental charges to Continental at
the following:

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

7.   TERM:  This agreement shall begin on March 2, 1995 and shall continue until
     ----                                                                       
March 1, 2000, unless otherwise terminated in accordance with the terms and
provisions hereof.

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:

     Staff Vice President                Vice President, Human Resources
     Properties & Facilities             & General Counsel
     Continental Airlines, Inc.          Frontier Airlines, Inc.
     2929 Allen Parkway, Suite #1401     12015 East 46th Avenue
     Houston, TX 77019                   Denver, CO 80239

9.   SECURITY DEPOSIT:  Concurrently with the execution of this Agreement,
     ----------------                                                     
COMPANY shall deliver to CONTINENTAL, as a Security Deposit, $0, which amount
may be commingled with other funds belonging to CONTINENTAL and shall bear no
interest.  The amount of the Security Deposit may be adjusted by CONTINENTAL as
provided herein.

10.  ADDITIONAL RENTAL / CHARGES / FEES:  The COMPANY shall be responsible for
     ----------------------------------                                       
and pay the following amounts:

None.

                                      -2-
<PAGE>
 
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
=====================================================================
<TABLE>
<CAPTION>
 
<S>   <C>                    <C>
 
 1)   Aviation General or    Per Occurrence:  $500,000,000*
      Comprehensive General  combined single limits covering bodily
      Liability              injury and property damage, endorsed to
                             include Premises Liability and
                             Contractual Liability.
 
                             *COMPANY limits if higher
---------------------------------------------------------------------
 
 2)   Worker's Compensation  Statutory
---------------------------------------------------------------------
 
 3)   Employer's Liability   $10,000,000
=====================================================================
 
</TABLE>

                                      -3-
<PAGE>
 
12.  SPECIAL PROVISIONS:
     ------------------ 

A.   ADDITIONAL SPACE - Frontier shall pay to Continental for use of one, two,
     ----------------                                                         
three or four gates at a single rate based on 13,814.60 SF of rented space.
Should Frontier elect to lease a fifth gate from Continental, Frontier shall pay
rental for that gate at the Standard Denver International Airport ("DIA") rate
for 5,000 SF.  Should Frontier elect to lease six or more gates from
Continental, then the rent for all gates leased from Continental shall be at the
Standard DIA rate for 5,000 SF.

B.   SPECIAL CANCELLATION - COMPANY shall have the right to terminate this
     --------------------                                                 
Agreement upon 60 days prior written notice to CONTINENTAL in the event COMPANY
(i) terminates all scheduled air service at Denver International Airport ("DIA")
or (ii) Company determines in its reasonable judgment that the cost paid by the
COMPANY for the DIA Concourse A automated baggage system places the COMPANY at
an unacceptable competitive disadvantage compared to the cost paid for the
baggage system at DIA's Concourse C by those air carriers operating at that
concourse.  Item (ii) of this Paragraph notwithstanding, Frontier may not
terminate if Continental, at its sole option, for as long as it chooses to do
so, reduces the amount due from Frontier for rental hereunder by the amount of
that difference in costs.

13.  STANDARD PROVISIONS:
     ------------------- 

                                USE OF PREMISES

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, 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 appropriate to this Agreement. COMPANY
further covenants that this Agreement shall be, in all respects, subject and
subordinate to the BASE LEASE, and nothing contained in this Agreement shall be
deemed to confer upon COMPANY any rights which are not granted by or are in
conflict with the BASE LEASE. Notwithstanding anything contained herein, (a)
this Agreement shall not be deemed to grant to COMPANY any rights or privileges
which CONTINENTAL does not have under the BASE LEASE, and (b) any act or
omission of CONTINENTAL required by the BASE LEASE shall in no event be deemed a
violation of this Agreement.

                             ACCEPTANCE OF PREMISES

Company HAS INSPECTED THE PREMISES AND ACKNOWLEDGES THAT Continental HAS MADE NO
REPRESENTATIONS 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 REPRESENTATIONS OF ANY KIND, EITHER EXPRESS
OR IMPLIED, ARISING BY LAW OR OTHERWISE, 

                                      -4-
<PAGE>
 
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 BUT
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.

                                     RENTAL

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, such 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.

                                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 CONTINENTAL, 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.   If at any time during the term hereof, the rental or other amounts due from
     COMPANY hereunder should increase, COMPANY shall remit to CONTINENTAL, upon
     written demand therefor, an amount sufficient to increase the Security
     Deposit to a level reflecting such increase.

C.   COMPANY's failure to remit any increase in, or any replenishment of the
     Security Deposit, as required herein, within five (5) days of receipt 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.

                                      -5-
<PAGE>
 
D.   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.

E.   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 the Security Deposit may be
     retained by CONTINENTAL in partial liquidation of CONTINENTAL's damages.

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

                                   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.

                               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 from
     the PREMISES in accordance with all applicable regulations governing such
     activity.  COMPANY shall keep all lobbies, vestibules and steps within the
     PREMISES free from dirt and rubbish.

                                      -6-
<PAGE>
 
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.

                                    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 one, 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 any act or omission on the part of
COMPANY, such indemnity to include all attorneys fees and other costs of defense
incurred in connection therewith.

                           GOVERNMENTAL REQUIREMENTS

     COMPANY covenants and agrees, at its sole expense, 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.

                     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 PREMISES, 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 safety, health and preservation and security of the PREMISES.

                            MAINTENANCE AND REPAIRS

A.   Any construction or alteration of the PREMISES required by COMPANY shall be
     made by COMPANY at its sole expense' and only upon prior, written approval
     by CONTINENTAL and OWNER.

                                      -7-
<PAGE>
 
B.   COMPANY covenants and agrees to maintain the PREMISES, and shall at its
     sole cost, 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, all of which shall be in accordance with the standards
     of the facility and of a quality and class not inferior to the original
     material and workmanship, normal wear and tear and damage by fire or other
     casualty excepted. All maintenance and repair work undertaken by COMPANY
     shall be performed in a good and workmanlike manner, leaving the PREMISES
     free of liens for labor and materials.

C.   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 nominally 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.

D.   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.

                                   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 possession 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 laws.

                                 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 be extended. CONTINENTAL shall make a
reasonable effort to minimize interference with COMPANY's operations during such
activity.

                                      -8-
<PAGE>
 
                                     TAXES

     COMPANY agrees to pay, before they become delinquent, all taxes (both
general and special), assessments, fees and charges of any kind whatsoever,
levied or assessed against the PREMISES, and any property of COMPANY located
thereon, and any business conducted by COMPANY thereon. COMPANY agrees to use
its best efforts to cause 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 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.

                                 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 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.  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. Either party may terminate this Agreement should such interruption
exceed thirty (30) days.

                                  RELATIONSHIP

     The relationship between COMPANY and CONTINENTAL shall be that of
independent contractor for all purposes and 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.

                                      -9-
<PAGE>
 
                                INDEMNIFICATION

                                    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 of 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.

                                   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"lndemnitees"), from and against all liabilities, losses, damages,
penalties, claims, costs, charges and expenses, causes of action and judgements
of any nature whatsoever, including without limitation reasonable attorneys'
fees, costs and related expenses, 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 any of the following, except if caused by the gross
negligence or willful misconduct of the Indemnities:

A.   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 COMPANY or any of its directors, officers, agents,
     contractors, servants, employees, licensees, invitees, successors and
     assigns;

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

C.   Any act or omission of Company or any of its directors, officers, agents,
     contractors, servants, employees, licensees, invitees, successors and
     assigns which causes any accident, injury to or death of any person, or
     damage to or destruction of any property occurring on 

                                      -10-
<PAGE>
 
     or in the vicinity of the PREMISES, including but not limited to aircraft
     or interference with CONTINENTAL's operations;

D.   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.

                            ENVIRONMENTAL OPERATIONS

COMPANY covenants and agrees:

     1)   that it shall not cause or permit any hazardous or toxic substance to
          be brought upon the PREMISES without the written consent of
          CONTINENTAL, and shall advise CONTINENTAL of any known or suspected
          environmental contamination;

     2)   that its operations shall at all times remain in compliance with:

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

          B)   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;

     3)   that it shall:

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

          B)   advise CONTINENTAL of any notice of potential or actual non-
               compliance;

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

          D)   CONTINENTAL's designated representatives the unrestricted right
               to inspect and review its on-premises operations and equipment.
               Unless necessary in an

                                      -11-

<PAGE>
 
              emergency situation, CONTINENTAL's representatives shall not
              purposefully interfere with or inhibit COMPANY's operation.

     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 Health and Safety Department
                         15333 JFK Boulevard, Suite 425
                               Houston, TX 77032

                            ENVIRONMENTAL INDEMNITY

     COMPANY covenants and agrees to release, indemnify, hold harmless and
defend CONTINENTAL, its parent and subsidiaries and their respective directors,
officers, employees, agents, successors and assigns from and against any and all
claims, liabilities, losses, expenses, damages, causes of action and judgements
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 or escape of any hazardous substance,
toxic chemical, pollutant, contaminant or irritant, in solid, liquid or gaseous
forms; 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.

                                   INSURANCE

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

     (1) 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 CONTINENTAL under this Agreement,
         where allowed by law.

     (2) The policies shall include a standard cross liability clause.

     (4) COMPANY's insurance shall be primary insurance and that any other
         insurance policy or policies of CONTINENTAL are noncontributory,
         secondary or excess insurance.

                                      -12-
<PAGE>
 
     (5) COMPANY's policy expressly insures COMPANY's contractual liability
         assumed by COMPANY under this Agreement.

     (6) COMPANY's insurers waive all rights of subrogation against CONTINENTAL,
         its officers, directors agents and employees and its insurers.

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

     (8) 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.

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.

                               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.

                                  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, 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.

B.   Immediately and without notice to COMPANY in the event that COMPANY 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 COMPANY or its
     assets pursuant to proceedings brought under the provisions of any federal
     reorganization act, or that a receiver of COMPANY's assets shall 

                                      -13-
<PAGE>
 
     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 of 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.

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 for 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.

                    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 because of race, color creed or national origin, in providing or refusing
to provide to 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.

                                     -14-
<PAGE>
 
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 orth in 41 CFR Sec. 60-250.4.

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

E.   Titles l, ll, 111, 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.

     COMPANY further covenants and agrees to:

     1)   Indemnify and defend Continental from and against any and all claims,
          liabilities, losses and judgements 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.

                           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.

                                  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 of 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.

                                   TEXAS LAW

     THIS AGREEMENT SHALL BE CONSTRUED AND PERFORMANCE THEREOF SHALL BE
DETERMINED ACCORDING TO THE LAWS OF THE STATE OF TEXAS.

                                     -15-
<PAGE>
 
                             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.

                                QUIET ENJOYMENT

     CONTINENTAL agrees that upon payment of the rents and other payments 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.

                                     LIENS

     COMPANY shall not allow any condition to exist or 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.

                                     WAIVER

     No waiver by either party at any time of any of the terms, conditions,
covenants or agreements herein or of any forfeiture, shall be deemed or 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 delay, failure or omission of CONTINENTAL to reenter
the PREMISES, or to exercise any right, power, privilege or option shall be
construed to be a waiver of any default or relinquishment thereof, or
acquiescence thereto, and no notice by CONTINENTAL shall be required to restore
or revive any right, power, privilege, option or remedy after waiver by
CONTINENTAL of default in one or more instances.  No right, power, privilege,
option or remedy of CONTINENTAL 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, and the exercise of one
right, power, option or remedy by either party shall not impair its right to any
other right, power, option or remedy except in those cases where it is expressly
so provided.

                                   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; but, subject to the foregoing, this Agreement and the
rights and obligations of the parties hereby created, 

                                     -16-
<PAGE>
 
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.

                                    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 interpretation or
construction thereof.

                               APPROVAL BY OWNER

     The parties hereto agree that this Agreement is subject to the consent and
approval of OWNER.  If written consent thereto is not forthcoming within thirty
(30) days of execution of this Agreement, given, either party may, at its
option, rescind its signature and this Agreement shall become null and void, and
the parties shall become discharged from all liabilities hereunder.

                                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 of 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.

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

CONTINENTAL AIRLINES, INC.          FRONTIER AIRLINES, INC.

BY:                                 BY:   /s/  Arthur T. Voss
   -----------------------------       ----------------------------


TITLE:                              TITLE:    Vice President
      --------------------------          -------------------------


DATE:                               DATE:     9/6/95
     ---------------------------         --------------------------

                                      -17-
<PAGE>
 
CITY AND COUNTY OF DENVER


BY:_____________________________


TITLE:__________________________


DATE:___________________________

                                     -18-
<PAGE>
 
                                   EXHIBIT A

Subject to the conditions set forth in the Agreement, the COMPANY shall have:

     (1) The right to use for commercial airline operations as granted to
         CONTINENTAL under the BASE LEASE the PREMISES as detailed on Exhibits B
         through K

                                     -19-
<PAGE>
 
                                  ATTACHMENT B
              FRONTIER AIRLINES SPACE ALLOCATION AND BILLING - DEN
              ----------------------------------------------------
                                                                       05-Sep-95
<TABLE>
<CAPTION>
                                                                             
                                                               ANNUAL       
                                                           --------------  MONTHLY  JUNE ACH
ROOM #                 SPACE DESCRIPTION        SQ. FT.    RATE/(1)/ COST   COST    BILLING 
------                 -----------------        -------    --------  ----   ----    -------
--------------------------------------------------------------------------------------------
CONCOURSE AREAS
--------------------------------------------------------------------------------------------
<S>                <C>                         <C>        <C>        <C>   <C>      <C>
Ramp Level
----------         
1514               IDF                             72.00  *          *     *        *
1340               A/C Shop                     2,615.90  *          *     *        *
1340-1             Men's Locker Room              276.30  *          *     *        *
1340-2             Janitor                         50.50  *          *     *        *
1340-3             Women's Locker Room            257.40  *          *     *        *
1340-4             Plumbing Access                 40.00  *          *     *        *
1340-5             Office                         106.30  *          *     *        *
1340-6             Breakroom                      282.60  *          *     *        *
1340-7             Office                         128.60  *          *     *        *
1340-8             IDF                             89.30  *          *     *        *
1340-9             Office                         236.50  *          *     *        *
1340-9A            Office                          22.20  *          *     *        *
1350-12            GSE Wash Bay                   485.40  *          *     *        *
1350-12A           Hotsy                           94.70  *          *     *        *
1370               Remote Ready Room               90.00  *          *     *        *
NA                 Circulation                    247.00  *          *     *        *
                   SUBTOTAL                    ---------             ----  ----  -------
                                                5,094.70             *     *        *
Concourse Level
---------------
    
2505               F9 Gate Lobby - A32          1,996.80  *          *     *
2347               F9 Gate Lobby - A34          1,953.90  *          *     *        *
2343               F9 Gate Lobby - A36          1,953.90  *          *     *        *
2325               F9 Gate Lobby - A38          1,910.30  *          *     *        *
                   SUBTOTAL                    ---------             ----  ----  -------
                                               $7,814.90             *     *        *
RAMP AREA (LINEAR FEET)                           560.00  *          *     *        *
CONCOURSE A JOINT USE ALLOCATION/(2)/                                *     *        *
TOTAL CONCOURSE AREAS                          12,909.60             *     *        *
----------------------------------------------------------------------------------------
</TABLE> 
                                      -20-
<PAGE>
 
<TABLE> 
<CAPTION> 
                                                           ATTACHMENT B
                                       Frontier Airlines Space Allocation and Billing - DEN
                                       ----------------------------------------------------
                                                                                                        05-Sep-95

                                                                   Annual             Monthly        June ACH
                                                                --------------- 
   Room #         Space Description               Sq. Ft.       Rate/(1)/  Cost        Cost          Billing
   ------         -----------------               -------       ---------  ----        ----          -------
-----------------------------------------------------------------------------------------------------------------
TERMINAL AREAS
-----------------------------------------------------------------------------------------------------------------
Level Six
---------           
<S>             <C>                               <C>                <C>     <C>          <C>             <C> 
NA              F9 Tckt Positions (#13-19)        480.00              *       *           *                *
-----------------------------------------------------------------------------------------------------------------
68B36           Office                            425.00              *       *           *                *
                                               ---------           ----    ----        ----             ----
                SUBTOTAL                          905.00              *       *           *                *
-----------------------------------------------------------------------------------------------------------------
TOTAL TERMINAL AREAS                              905.00              *       *           *                *
                                                                           ----        ----             ----
-----------------------------------------------------------------------------------------------------------------

-----------------------------------------------------------------------------------------------------------------
TOTAL ALL AREAS/(3)/                           13,814.60              *       *           *                *
-----------------------------------------------------------------------------------------------------------------
 
</TABLE>
/(1)/ Square footage rates are comprised of tenant finish and basic rental
      components.

/(2)/ Concourse A Joint Use costs are allocated based upon $ of total exclusive
      square footage.

/(3)/ Please note that variable costs associated with baggage system usage are
      not included. These amounts will be billed directly to Frontier Airlines
      by the City and County of Denver.

                                     -21-
<PAGE>
 
 CONFIDENTIAL TREATMENT HAS BEEN SOUGHT FOR PORTIONS OF THIS DOCUMENT MARKED 
     WITH " * " AND SUCH PROTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC

                                FIRST AMENDMENT

     This Amendment is made as of the 15th day of November, 1995, but actually
entered into as of the date last set forth below, by and between Continental
Airlines, Inc. ("Continental") and Frontier Airlines, Inc. ("Frontier").

     WHEREAS, Continental has leased certain premises in Concourse A of the
Denver International Airport from the City and County of Denver ("Owner"); and

     WHEREAS, by that certain Space and Use Agreement dated March 2, 1995 (the
"Agreement"), Continental has granted to Frontier the right to use part of such
premises (the "Premises") and Frontier has accepted the Premises; and

     WHEREAS, Continental and Frontier desire to amend the Agreement pursuant to
the terms and conditions set forth herein.

     NOW, THEREFORE, in consideration of the terms and covenants contained
herein, the Agreement is hereby amended as follows:

     1.   Effective as of November 15, 1995 and continuing during the term of
the Agreement, and while Frontier is not in default under its obligations
thereunder or hereunder, after submission to Continental of copies of proper
invoices received by Frontier from the City, Continental will  * . Unless
Continental elects to make such payments directly to the City as hereinbelow
provided, such * will be accomplished through the Airline Clearing House on the
latest Airline Clearing House settlement date that is at least five days prior
to the date that such charges are required to be paid to the City, or through
such other agreed upon method as will not require Frontier to pay such charges
to the City prior to reimbursement by Continental; provided, further, that such
reimbursement for the period November 15, 1995 through February 29, 1996 shall
be made on or before February 29, 1996. If elected by Continental, Continental
may pay such amounts required hereunder to be reimbursed by Continental to
Frontier directly to the City.  Frontier shall promptly (and in any event prior
to delinquency) remit to City any sums reimbursed to Frontier by Continental
hereunder.

     2.   Effective * , and while Continental is not in default under its
obligations under Section 1 above, the amount payable by Frontier to Continental
under Paragraph 6 of the Agreement shall be * each at the same time and manner
as payments are required to be paid by Frontier to Continental under Paragraph 6
of the Agreement; provided, that the additional monthly payments for each of the
months of January, February and March of 1996 shall be * , and shall be made on
or before February 29, 1996 (and such increased amount for such months shall not
affect Frontier's obligation for the remaining months of 1996 or thereafter).
If and when, and at each time  that, the City of Denver rental rates or charges
for Concourses A or C at Denver International Airport are hereafter increased

                                      -1-
<PAGE>
 
or decreased, then the * amount (and related monthly payments referred to above,
as such amount is adjusted as herein provided from time to time, shall
thereafter be increased or decreased, as the case may be, so that the annual
amount paid by Frontier to Continental under this Section 2 will be adjusted to
equal the new annual amount that would be obtained by substituting the new
rental rates and charges for the rental rates and charges shown on Exhibit "A",
which is attached hereto and incorporated herein by this reference, and by
thereafter performing the same calculations as are indicated on such Exhibit to
solve for the new annual amount (in place of the * annual amount now set forth
on Exhibit "A") (with all other aspects of the methodology reflected on Exhibit
"A", including, without limitation, the square footages and percentage
allocations reflected thereon, remaining the same). However, in no event shall
any increase in costs for which Continental is required under Section 1 above to
reimburse Frontier cause the annual amount to be paid by Frontier hereunder to
decrease. Frontier shall prepare the new Exhibit "A" reflecting the adjusted
calculations and shall deliver such new Exhibit to Continental for Continental's
approval. Upon approval of such new Exhibit reflecting the new annual amount
referred to above, such Exhibit shall then be deemed a part of this Amendment
without need of any formal amendment.

     3.   Paragraph 12A of the Space and Use Agreement is deleted and replaced
with a provision stating that if Frontier leases additional Concourse A gate(s)
from Continental, its rent obligation to Continental shall be based on the
actual square feet of the additional leased gate(s) and the actual square feet
of any additional Concourse A space leased from Continental.

     4.   Paragraph 12B of the Space and Use Agreement relating to Special
Cancellation rights in Frontier as a result of Concourse A Automated Baggage
System charges is deleted.

     5.   Except as expressly provided in this Amendment, the Agreement is
unmodified and remains in full force and effect.  Frontier and Continental agree
that the Agreement, as modified by this Amendment, sets forth the entire
agreement of the parties with respect to the matters addressed therein and
herein and that each such party is fully bound by the terms of the Agreement, as
modified by this Amendment.  This Amendment supercedes and replaces that certain
Term Sheet executed by Continental and Frontier relating to the subject matter
hereof.

     6.   By execution below, the City (i) approves the Agreement and this
Amendment, and (ii) acknowledges and agrees that nothing contained herein shall
be deemed to create any rights in favor of the City to require Continental to
pay to the City any sums attributable to Frontier's use of Concourse A or the
ABS, whether under a third party beneficiary theory or otherwise, and that the
City shall look solely to Frontier for payment of any costs associated with the
ABS or for payment of any other amounts that Frontier may have agreed to pay to
the City.

     7.   This Amendment shall not be effective until executed by the parties
hereto and the City.  This Amendment may be executed in multiple counterparts
(and delivered by facsimile transmission), each of which shall constitute an
original, but all of which together shall constitute one and the same
instrument.

                                      -2-
<PAGE>
 
Agreed:                        Agreed:

Continental Airlines, Inc.     Frontier Airlines, Inc.
 
By       /s/ H. Shannon        By     /s/ Arthur T. Voss
         --------------------         ------------------
 
Name     Holden Shannon        Name   Arthur T. Voss
         --------------------         ------------------
 
Title    Staff Vice President  Title  Vice President
         --------------------         ------------------
 
Date     2/12/96               Date   2/7/96
         --------------------         ------------------
 
Agreed:

City and County of Denver

By   _______________________________

Name _______________________________

Title ______________________________

Date _______________________________

                                      -3-
<PAGE>
 
                               LETTER AGREEMENT

This letter agreement incorporates the City and County of Denver ("OWNER")
comments to the Continental Airlines, Inc. ("CONTINENTAL") sublease agreement
with Frontier Airlines, Inc. ("COMPANY") effective March 2, 1995 and executed by
CONTINENTAL on September 7, 1995 and by COMPANY on September 6, 1995.  It is
mutually agreed that, effective March 2, 1995, the sublease agreement will
incorporate the following revisions requested by the OWNER which have been
underlined for clarification purposes only.

Section 3.  Description of Premises on page 1.  This section will read as
follows:

     Certain space on and within the Denver International Airport, as well as
     reasonable rights of ingress and egress and the use of associated areas,
     being more fully described in Exhibits B-K, attached hereto and made a part
                                            -                                   
     hereof.


Section 13.  Standard Provisions on page 6.  The section heading Use of Premises
will be replaced as follows:

     SUBJECT TO BASE LEASE
     ---------------------


Section 13.  Standard Provisions on page 13 Environmental Operations.  Item
(3)(B) of this section will read as follows:

     advise CONTINENTAL and OWNER of any notice of potential or actual non-
                        ---------                                         
     compliance.


Section 13.  Standard Provisions on page 14 Environmental Operations.  Item
(3)(C) of this section will read as follows:

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


Section 13.  Standard Provisions on page 14 Environmental Operations.  Item
(3)(D) of this section will read as follows:

     allow CONTINENTAL's and OWNER's designated representatives the unrestricted
     -----               -----------                                            
     right to inspect and review its on-premises operations and 

                                       1
<PAGE>
 
     equipment. Unless necessary in an emergency situation, neither
                                                            -------
     CONTINENTAL's nor OWNER's representatives shall purposely interfere with or
                   -----------
     inhibit COMPANY's operation.


Section 13.  Standard Provisions on page 14 Environmental Operations.  Shall
include the following paragraph:

     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 petroleum or petroleum derivative, (c) a
     ---------------------------------------------------------------------------
     flammable explosive, (d) a radioactive material, (e) a polychlorinated
     ----------------------------------------------------------------------
     biphenyl, (f) asbestos or an asbestos derivative, (g) urea formaldehyde
     -----------------------------------------------------------------------
     foam insulation, or (h) radon gas.
     --------------------------------- 


Section 13.  Standard Provisions on page 14 Environmental Indemnity.  The
sentence which begins "COMPANY covenants and agrees to release...." will read as
follows:

     COMPANY covenants and agrees to release, indemnify, hold harmless and
     defend OWNER and CONTINENTAL, its parent and subsidiaries and their
            ---------                                                   
     respective directors, officers, employees, agents, successors and assigns
     from and against any and all claims, liabilities, losses, expenses,
     damages, causes of action and judgments 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 or escape of any hazardous substance, toxic
     chemical pollutant, contaminant or irritant, in solid, liquid 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.

                                       2
<PAGE>
 
Section 13.  Standard Provision of page 15 Insurance.  Item (1) of this section
will read as follows:

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


Section 13.  Standard Provision on page 15 Insurance.  Item (4) of this section
will read as follows:

     COMPANY'S insurance shall be primary insurance and that any other insurance
     policy or policies of CONTINENTAL and OWNER are noncontributory, secondary
                                       ---------                               
     or excess insurance.


Section 13.  Standard Provisions on page 15 Insurance.  Item (6) of this section
will read as follows:

     COMPANY'S insurers waive all rights of subrogation against CONTINENTAL and
                                                                            ---
     OWNER, and their respective officers, directors, agents, and employees and
     ---------------------------                                               
     their insurers.
     -----          


Section 13.  Standard Provision on page 15 Insurance.  Item (8) of this section
will read as follows:

     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.
     --------- 


Section 13.  Standard Provisions on page 17 NON-DISCRIMINATION AND EQUAL
OPPORTUNITY item 1 of the Company covenant and agreement will read as follows:

     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

                                       3
<PAGE>
 
Section 13.  Standard Provisions on page 18 TEXAS LAW will now read COLORADO
                                                                    --------
LAW.


Section 13.  Standard Provisions on page 20 ENTIRE AGREEMENT.  The sentence
which begins  "No amendment, change or addition...."  Will read as follows:

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

     The parties hereto have caused this Letter Agreement to be executed as of
     the effective date hereof.


     CONTINENTAL AIRLINES, INC.          FRONTIER AIRLINES, INC.

     BY:_________________________        BY:   /s/ Arthur T. Voss
                                            ------------------------------------

     TITLE:______________________        TITLE:        V.P.
                                                 -------------------------------

     DATE:______________________         DATE:  Effective March 2, 1995
                                                ---------------------------


     CITY AND COUNTY OF DENVER

     BY:_________________________

     TITLE:______________________

     DATE:______________________

                                       4