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EXHIBIT 99.2
CONFIDENTIAL
OMNIBUS AGREEMENT
DATED AS OF NOVEMBER 15, 2000
AMONG
CONTINENTAL AIRLINES, INC.,
NORTHWEST AIRLINES CORPORATION,
NORTHWEST AIRLINES HOLDINGS CORPORATION,
NORTHWEST AIRLINES, INC.,
AND
AIR PARTNERS, L.P.
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TABLE OF CONTENTS
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ARTICLE I. DEFINITIONS...........................................................................................1
Section 1.01. Definitions.....................................................................................1
Section 1.02. Rules of Construction...........................................................................1
ARTICLE II. SALE AND PURCHASE OF CLASS A SHARES..................................................................2
Section 2.01. Sale and Purchase of Class A Shares.............................................................2
Section 2.02. Class A Purchase Price..........................................................................3
ARTICLE III. SALE AND PURCHASE OF SERIES B SHARE.................................................................3
Section 3.01. Sale and Purchase of Series B Share.............................................................3
Section 3.02. Series B Purchase Price.........................................................................3
ARTICLE IV. CONDITIONS TO CLOSING................................................................................3
Section 4.01. Delivery of Documents...........................................................................3
Section 4.02. Conditions to Continental's Obligation to Close.................................................3
Section 4.03. Conditions to the Northwest Parties' Obligation to Close........................................4
Section 4.04. Conditions to Each Party's Obligation to Close..................................................4
ARTICLE V. CLOSING...............................................................................................5
Section 5.01. Closing.........................................................................................5
ARTICLE VI. REPRESENTATIONS AND WARRANTIES REGARDING CONTINENTAL.................................................7
Section 6.01. Organization and Qualification..................................................................7
Section 6.02. Authorization of Agreement......................................................................7
Section 6.03. Approvals.......................................................................................7
Section 6.04. No Violation....................................................................................8
Section 6.05. Series B Share..................................................................................8
Section 6.06. Class B Common Stock............................................................................8
Section 6.07. No Brokers......................................................................................8
ARTICLE VII. REPRESENTATIONS AND WARRANTIES REGARDING THE NORTHWEST PARTIES......................................9
Section 7.01. Organization and Qualification..................................................................9
Section 7.02. Authorizations..................................................................................9
Section 7.03. Approvals.......................................................................................9
Section 7.04. No Violation...................................................................................10
Section 7.05. Repurchased Class A Shares.....................................................................10
Section 7.06. No Brokers.....................................................................................10
ARTICLE VIII. COVENANTS.........................................................................................10
Section 8.01. Covenants and Agreements of Continental........................................................10
Section 8.02. Covenants of the Northwest Parties.............................................................12
ARTICLE IX. INDEMNIFICATION.....................................................................................13
Section 9.01. Survival of Representations, Warranties and Covenants..........................................13
Section 9.02. General Indemnification........................................................................13
Section 9.03. Procedures.....................................................................................13
Section 9.04. Consequential Damages..........................................................................15
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ARTICLE X. TERMINATION, AMENDMENT AND WAIVER....................................................................15
Section 10.01. Termination...................................................................................15
Section 10.02. Effect of Termination.........................................................................16
Section 10.03. Amendment.....................................................................................16
Section 10.04. Waiver........................................................................................16
ARTICLE XI. MISCELLANEOUS.......................................................................................17
Section 11.01. Notices.......................................................................................17
Section 11.02. Headings......................................................................................18
Section 11.03. Severability..................................................................................18
Section 11.04. Entire Agreement..............................................................................18
Section 11.05. Assignment....................................................................................18
Section 11.06. Parties in Interest...........................................................................18
Section 11.07. Failure or Indulgence Not Waiver; Remedies Cumulative.........................................18
Section 11.08. GOVERNING LAW; CONSENT TO JURISDICTION........................................................19
Section 11.09. Specific Performance..........................................................................19
Section 11.10. Counterparts..................................................................................19
Section 11.11. Other Rights..................................................................................20
Section 11.12. Further Assurances............................................................................20
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Annexes and Exhibits
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Annex A -- Definitions
Exhibit 1 -- Amended and Restated Certificate of Incorporation
Exhibit 2 -- Termination of Northwest Airlines/Air Partners Voting Trust Agreement
Exhibit 3 -- Series B Certificate of Designations
Exhibit 4 -- Termination of Amended and Restated Governance Agreement
Exhibit 5 -- Termination of Supplemental Agreement
Exhibit 6 -- Standstill Agreement
Exhibit 7 -- Amendment No. 1 to Amended and Restated Registration Rights Agreement
Exhibit 8 -- Reoffer Purchase Agreement
Exhibit 9 -- Amended and Restated Rights Agreement
Exhibit 10 -- Form of Irrevocable Instruction Pursuant to Voting Trust Agreement
Exhibit 11 -- Form of Transfer Restriction Agreement
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OMNIBUS AGREEMENT
This OMNIBUS AGREEMENT (this "AGREEMENT") dated as of November 15, 2000
is among Continental Airlines, Inc., a Delaware corporation ("CONTINENTAL"),
Northwest Airlines Corporation, a Delaware corporation ("NW Parent"), Northwest
Airlines Holdings Corporation, a Delaware corporation ("NW HOLDINGS"), Northwest
Airlines, Inc., a Minnesota corporation ("NORTHWEST"), and Air Partners, L.P., a
Texas limited partnership ("AIR PARTNERS", and together with NW Parent, NW
Holdings and Northwest, the "NORTHWEST PARTIES").
RECITALS:
WHEREAS, Northwest and Continental desire to make certain amendments to
the Master Alliance Agreement;
WHEREAS, Continental intends to effect a reclassification of its Class
A Common Stock into its Class B Common Stock, which reclassification is intended
to qualify as a tax-free reorganization pursuant to Section 368(a)(1)(E) of the
Code, and this Agreement is intended to constitute a "plan of reorganization"
for purposes of Section 368 of the Code;
WHEREAS, immediately prior to the reclassification of its Class A
Common Stock, Continental desires to purchase, and NW Parent desires to sell, a
portion of the Class A Common Stock owned by NW Parent and its Affiliates; and
WHEREAS, in connection with such reclassification and purchase,
Continental, NW Parent, NW Holdings, Air Partners and 1992 Air, Inc. intend to
enter into the Reoffer Purchase Agreement;
WHEREAS, as an inducement to NW Parent's agreeing to the
reclassification of Continental's Class A Common Stock and the sale of a portion
of the Class A Common Stock owned by NW Parent and its Affiliates to Continental
and in connection with the making of such amendments to the Master Alliance
Agreement, Continental is willing to issue, and Northwest seeks to acquire, one
share of Series B Preferred Stock;
NOW, THEREFORE, the parties hereto, in consideration of the premises
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, agree as follows:
ARTICLE I.
DEFINITIONS
Section 1.01. Definitions. Certain capitalized and other terms used in
this Agreement are defined in Annex A hereto and are used herein with the
meanings ascribed to them therein.
Section 1.02. Rules of Construction. Unless the context otherwise
requires, as used in this Agreement:
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(a) (i) a term defined in Annex A has the meaning ascribed to it
in Annex A; (ii) an accounting term not otherwise defined
herein has the meaning ascribed to it in accordance with U.S.
GAAP; (iii) "or" is not exclusive; (iv) "including" means
"including, without limitation;" (v) words in the singular
include the plural and vice versa; (vi) words applicable to
one gender apply to each gender; (vii) the terms "hereof,"
"herein," "hereby," "hereto" and derivative or similar words
refer to this entire Agreement, including the Annexes and
Exhibits hereto; and (viii) the terms "Article", "Section",
"Annex" and "Exhibit" refer to the specified Article, Section,
Annex or Exhibit of or to this Agreement;
(b) a reference to any Law includes all other Laws and Regulations
varying, consolidating or replacing the same from time to
time, and a reference to a statute includes all regulations,
policies, protocols, proclamations, executive orders and
ordinances issued or otherwise applicable under that statute
unless, in any such case, otherwise expressly provided in any
such statute or in this Agreement; a reference to a particular
section, paragraph or other part of a particular statute shall
be deemed to be a reference to any other section, paragraph or
other part substituted therefor from time to time;
(c) a reference to any Person includes such Person's successors
and permitted assigns;
(d) any reference to "days" shall mean calendar days unless
"Business Days" (as defined in Annex A) are expressly
specified; references to "calendar" mean the Gregorian
calendar; and
(e) the Annexes and Exhibits identified in this Agreement are
incorporated herein by reference and made a part hereof for
all purposes.
Each of Continental and the Northwest Parties has been represented by legal
counsel and has participated in the negotiation and drafting of this Agreement.
If an ambiguity or question of intent or interpretation should arise, this
Agreement shall be construed as if drafted jointly by such parties and no
presumption or burden of proof shall arise favoring or burdening any party
hereto by virtue of the authorship of any of the provisions of this Agreement.
ARTICLE II.
SALE AND PURCHASE OF CLASS A SHARES
Section 2.01. Sale and Purchase of Class A Shares. On the terms and
subject to the conditions contained in this Agreement, Continental agrees to
purchase out of funds legally available therefor, NW Parent agrees to sell to
Continental 584,985 shares of Class A Common Stock and NW Holdings agrees to
sell to Continental 6,100,294 shares of Class A Common Stock (collectively, the
"REPURCHASED CLASS A SHARES").
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Section 2.02. Class A Purchase Price. The consideration for such sale
and purchase of the Repurchased Class A Shares shall be four hundred fifty
million dollars ($450,000,000) in the aggregate (the "CLASS A PURCHASE PRICE"),
paid as provided in Section 5.01(b)(ii) below, provided that if the Closing
occurs on a date later than February 7, 2001 the Class A Purchase Price shall be
increased by an amount per annum equal to 7% of the Class A Purchase Price,
calculated on the basis of a 365-day year based on actual days elapsed from and
including February 8, 2001 through but excluding the Closing Date.
ARTICLE III.
ISSUANCE AND PURCHASE OF SERIES B SHARE
Section 3.01. Issuance and Purchase of Series B Share. On the terms and
subject to the conditions contained in this Agreement, Northwest agrees to
purchase, and Continental agrees to issue to Northwest, the Series B Share.
Section 3.02. Series B Purchase Price. The consideration for such
issuance and purchase of the Series B Share shall be one hundred dollars ($100)
(the "SERIES B PURCHASE PRICE"), paid as provided in Section 5.01(c)(v) below.
ARTICLE IV.
CONDITIONS TO CLOSING
Section 4.01. Delivery of Documents. On the date hereof, and coincident
with the execution and delivery of this Agreement, each of the parties to this
Agreement shall have executed four copies of Amendment No. 1 to the Master
Alliance Agreement, dated as of the date hereof, between Continental and
Northwest (the "AMENDMENT OF ALLIANCE AGREEMENT"), and each of the documents set
forth as Exhibits 2, 4, 5, 6, 7 and 8 to which it is a party and delivered two
copies of such executed documents to Continental (in the case of the Northwest
Parties) or NW Parent (in the case of Continental). A fifth executed original of
the Voting Trust Termination Agreement shall also be delivered to the Trustee.
Section 4.02. Conditions to Continental's Obligation to Close. The
obligation of Continental to consummate the transactions contemplated hereby
shall be subject to the satisfaction (or waiver by Continental) at or prior to
the Closing of the following conditions:
(a) the representations and warranties of the Northwest Parties
contained in Article VII of this Agreement and containing a
reference to "material," "materially," "Material Adverse
Effect" or a similar phrase shall be true and correct, and all
other representations and warranties of the Northwest Parties
contained in Article VII of this Agreement shall be true and
correct in all material respects, in each case as of the
Closing Date as though made as of such time (provided that the
text of any representation or warranty that refers to a
specific date (including the date of this Agreement) shall be
deemed to continue to refer to such date);
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(b) the agreements and covenants of the Northwest Parties to be
complied with or performed on or before the Closing Date
pursuant to the terms hereof shall have been duly complied
with or performed in all material respects;
(c) NW Parent and other parties to the Investment Agreement shall
have amended the Investment Agreement so as to effectively
terminate the limited proxy set forth in Section 4.2 thereof;
and
(d) the deliveries contemplated to be made to Continental under
Section 5.01 shall have been made.
Section 4.03. Conditions to the Northwest Parties' Obligation to Close.
The obligation of the Northwest Parties to consummate the transactions
contemplated hereby shall be subject to the satisfaction (or waiver by the
Northwest Parties) at or prior to the Closing of the following conditions:
(a) the representations and warranties of Continental contained in
Article VI of this Agreement and containing a reference to
"material," "materially," "Material Adverse Effect" or a
similar phrase shall be true and correct, and all other
representations and warranties of Continental contained in
Article VI of this Agreement shall be true and correct in all
material respects, in each case as of the Closing Date as
though made as of such time (provided that the text of any
representation or warranty that refers to a specific date
(including the date of this Agreement) shall be deemed to
continue to refer to such date);
(b) the agreements and covenants of Continental to be complied
with or performed on or before the Closing Date pursuant to
the terms hereof shall have been duly complied with or
performed in all material respects;
(c) the shares of Class B Common Stock issuable to NW Parent and
its Affiliates in accordance with the Reclassification (as
defined below) shall have been approved for listing on the New
York Stock Exchange, subject only to notice of issuance;
(d) Continental shall have taken all requisite action to amend the
Rights Agreement so that it shall be effective at or prior to
the Effective Time in the form of the Amended and Restated
Rights Agreement; and
(e) the deliveries contemplated to be made to the Northwest
Parties under Section 5.01 shall have been made.
Section 4.04. Conditions to Each Party's Obligation to Close. The
obligation of each Party to consummate the transactions contemplated hereby
shall be subject to the satisfaction at or prior to the Closing of the following
conditions:
(a) at the Continental Stockholders Meeting called by Continental
pursuant to Section 8.01(b) below, the stockholders of
Continental shall have approved by the
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requisite vote one or more resolutions providing for the
adoption of the Amended and Restated Certificate of
Incorporation (the "RECLASSIFICATION"), which shall, among
other things, effect the reclassification of each share of
Class A Common Stock outstanding or held as treasury shares
immediately prior to the Effective Time (and immediately
subsequent to the transactions described in Section 5.01(b))
into 1.32 shares of Class B Common Stock;
(b) each other party to the Reoffer Purchase Agreement shall have
performed in all material respects its obligations thereunder;
(c) no injunction or order issued by any Court that prevents the
consummation of any of the transactions contemplated by this
Agreement shall be in effect; and
(d) any U.S. Department of Transportation review period to which
the Amendment of Alliance Agreement may be subject under Title
49 U.S.C. Section 41720 shall have lapsed, without material
adverse action.
ARTICLE V.
CLOSING
Section 5.01. Closing. The transactions contemplated hereby shall be
consummated at a closing (the "CLOSING"), which shall be held at the offices of
Vinson & Elkins L.L.P. in Houston, Texas on the Closing Date. The "CLOSING DATE"
shall be the date on which the Continental Stockholders Meeting shall occur or
such later date on which the Closing Conditions shall have been fulfilled or
waived (other than those Closing Conditions that by their nature are to be
satisfied only at Closing) as provided in Section 8.01(b), or such other date as
Continental and NW Parent may, by written agreement, establish. At the Closing,
the following events shall occur, each event being conditioned on the occurrence
or waiver of each other event:
(a) Immediately prior to the events described in Section 5.01(b)
below, Continental and the Northwest Parties that are parties
thereto shall have performed their respective obligations
under the Voting Trust Termination Agreement, and the Trustee
shall have performed its obligations as required by the Voting
Trust Agreement.
(b) The following events shall be deemed to occur simultaneously
with each other, immediately subsequent to the events
described in Section 5.01(a) above and immediately prior to
the events described in Section 5.01(c) below:
(i) NW Parent shall cause to be delivered to Continental
the certificate or certificates evidencing the
Repurchased Class A Shares, which certificates shall
be duly endorsed for transfer or accompanied by duly
executed stock transfer powers or other appropriate
instruments of assignment and transfer in favor of
Continental; and
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(ii) Continental shall pay the Class A Purchase Price to
NW Parent and NW Holdings apportioned according to
their respective ownership of Repurchased Class A
Shares. Such amount shall be paid in cash in United
States Dollars by wire transfer of immediately
available funds to the wire transfer addresses of NW
Parent and NW Holdings as they shall designate to
Continental no later than one Business Day prior to
the Closing Date.
(c) Except as otherwise described below, the following events
shall be deemed to occur simultaneously with each other and at
the Effective Time:
(i) Continental shall have filed the Amended and Restated
Certificate of Incorporation (the time of such
filing, the "EFFECTIVE TIME"), with the Secretary of
State of the State of Delaware;
(ii) Continental shall have filed the Series B Certificate
of Designations with the Secretary of State of the
State of Delaware, with an effective time immediately
subsequent to the Effective Time;
(iii) NW Parent shall cause to be delivered to Continental
the certificate or certificates evidencing 1,975,945
shares of Class A Common Stock, which shall
constitute all of the shares of Class A Common Stock
beneficially owned by NW Parent and its Affiliates
subsequent to the sale to Continental of the
Repurchased Class A Shares as contemplated by Section
5.1(b), which certificates shall be duly endorsed for
transfer or accompanied by duly executed stock
transfer powers or other appropriate instruments of
assignment and transfer in favor of Continental;
(iv) Continental shall deliver to NW Parent a certificate
evidencing 2,608,247 shares of Class B Common Stock,
issued to NW Parent or such Affiliate of NW Parent as
NW Parent shall direct not less than two days prior
to the Closing, and cash in lieu of any fraction of a
share of Class B Common Stock that results from the
reclassification of Class A Common Stock held by NW
Parent and its Affiliates into Class B Common Stock
as provided in the Amended and Restated Certificate
of Incorporation;
(v) immediately after the Effective Time, Northwest shall
pay to Continental the Series B Purchase Price;
(vi) immediately after the Effective Time and after
receipt of the Series B Purchase Price, Continental
shall deliver to Northwest a certificate evidencing
the Series B Preferred Share issued to Northwest;
(vii) Continental shall deliver to Northwest a copy of the
Amended and Restated Rights Agreement effective at or
prior to the Effective Time;
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(viii) NW Parent shall deliver to Continental a copy of the
amendment to the Investment Agreement referenced in
Section 4.02(c) effective at or prior to the
Effective Time; and
(ix) each of Continental and the Northwest Parties shall
deliver an officer's certificate in a form reasonably
satisfactory to the other parties, including
certifications as to the incumbency of officers and
to resolutions duly adopted by the board of directors
of such entity approving the transactions
contemplated by this Agreement.
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES
REGARDING CONTINENTAL
Continental represents and warrants to the Northwest Parties that:
Section 6.01. Organization and Qualification. Continental is a
corporation duly organized, validly existing and in good standing under the Laws
of the State of Delaware and has all requisite corporate power and authority to
own, lease and operate its properties and to carry on its business as it is now
being conducted.
Section 6.02. Authorization of Agreement. Continental has all requisite
corporate power and authority to execute and deliver this Agreement and the
Ancillary Agreements to which it is a party, to perform its obligations
hereunder and thereunder and to consummate the transactions contemplated hereby
and thereby, subject only to stockholder approval of the Amended and Restated
Certificate of Incorporation. The execution and delivery by Continental of this
Agreement and the Ancillary Agreements to which it is a party and the
performance by it of its obligations hereunder and thereunder have been duly and
validly authorized by all requisite corporate action on the part of Continental,
subject only to stockholder approval of the Amended and Restated Certificate of
Incorporation. This Agreement and each Ancillary Agreement to which it is a
party have been duly executed and delivered by Continental and (assuming due
authorization, execution and delivery hereof by the other parties thereto)
constitute the legal, valid and binding obligations of Continental, enforceable
against Continental in accordance with their respective terms, subject to
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar Laws relating to or affecting the enforcement of creditors' rights
generally and legal principles of general applicability governing the
availability of equitable remedies (whether considered in a proceeding in equity
or at law or under applicable legal codes). The Amended and Restated Certificate
of Incorporation and the Series B Certificate of Designations have been duly and
validly authorized by all requisite corporate action on the part of Continental,
subject only to stockholder approval of the Amended and Restated Certificate of
Incorporation.
Section 6.03. Approvals. Except for applicable Laws, if any,
noncompliance with which could not reasonably be expected to prevent Continental
from performing its obligations under this Agreement and each Ancillary
Agreement to which it is a party in all material respects, the filings required
pursuant to Section 5.01(c) and 8.01(a), and the review by the U.S. Department
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of Transportation of the Amendment of Alliance Agreement pursuant to Title 49
U.S.C. Section 41720, no filing or registration with, no waiting period imposed
by and no Authorization of, any Governmental Authority is required under any
Laws applicable to Continental to permit Continental to execute, deliver or
perform its obligations under this Agreement or any Ancillary Agreement or to
consummate the transactions contemplated hereby and thereby.
Section 6.04. No Violation. Assuming effectuation of all filings and
registrations and receipt of all Authorizations described in Section 6.03 and
the listing of the shares of Class B Common Stock as described in Section
4.03(c), neither the execution and delivery by Continental of this Agreement or
any Ancillary Agreement to which it is a party nor the performance by
Continental of its obligations hereunder or thereunder will (a) violate or
breach the terms of or cause a default under (i) any federal or Texas Laws
applicable to Continental, (ii) the certificate of incorporation (as it
currently exists, and after giving effect to the Reclassification and the
adoption of the Amended and Restated Certificate of Incorporation) or bylaws of
Continental or (iii) any contract or agreement to which Continental or any of
its Subsidiaries is a party or by which it or any of its properties or assets is
bound or (b), with the passage of time, the giving of notice or the taking of
any action by a third Person, have any of the effects set forth in clause (a) of
this Section 6.04, except in any such case for any matters described in
subclause (i) or (iii) of clause (a) of this Section 6.04 that could not
reasonably be expected to prevent Continental from performing its obligations
under this Agreement or any Ancillary Agreement in all material respects.
Section 6.05. Series B Share. When issued to Northwest pursuant to
Section 5.01(c)(vi) and paid for pursuant to Section 5.01(c)(v), the Series B
Share will have been duly authorized and will be validly issued, fully paid and
non-assessable. The issuance of the share of Series B Preferred Stock to
Northwest and the powers, designations, preferences and relative, participating,
optional or other rights of such share of Series B Preferred Stock are permitted
under and do not contravene the General Corporation Law of the State of
Delaware. Other than under this Agreement, there are no outstanding
subscriptions, options, warrants, rights, conversion rights, rights of first
refusal or other agreements or commitments obligating Continental to offer,
sell, transfer or otherwise dispose of the Series B Share.
Section 6.06. Class B Common Stock. Upon delivery of the Class B Common
Stock to Northwest pursuant Section 5.01(c)(iv), and receipt by Continental of
the certificate or certificates of Class A Common Stock required by Section
5.01(c)(iii), such Class B Common Stock will have been duly authorized and will
be validly issued, fully paid and non-assessable and the holders of outstanding
shares of the capital stock of Continental are not entitled to pre-emptive or
other rights to subscribe for such shares (assuming the termination of the
Governance Agreement at the Effective Time).
Section 6.07. No Brokers. No broker, finder or investment banker (other
than UBS Warburg LLC and Credit Suisse First Boston Corporation) is entitled to
any brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Continental. Any amounts payable to UBS Warburg LLC or Credit
Suisse First Boston Corporation in connection with such arrangements will be the
responsibility of Continental.
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ARTICLE VII.
REPRESENTATIONS AND WARRANTIES
REGARDING THE NORTHWEST PARTIES
Each of the Northwest Parties represents and warrants to Continental
that:
Section 7.01. Organization and Qualification. Each of NW Parent and NW
Holdings is a corporation duly organized, validly existing and in good standing
under the Laws of the State of Delaware and has all requisite corporate power
and authority to own, lease and operate its properties and to carry on its
business as it is now being conducted. Northwest is a corporation duly
organized, validly existing and in good standing under the Laws of the State of
Minnesota and has all requisite corporate power and authority to own, lease and
operate its properties and to carry on its business as it is now being
conducted. Air Partners is a limited partnership duly formed and validly
existing under the Laws of the State of Texas and has all requisite authority
under its limited partnership agreement to own, lease and operate its properties
and to carry on its business as it is now being conducted.
Section 7.02. Authorizations. Each of the Northwest Parties has all
requisite corporate or partnership power and authority to execute and deliver
this Agreement and the Ancillary Agreements to which it is a party, to perform
its obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery by each of the
Northwest Parties of this Agreement and the Ancillary Agreements to which it is
a party and the performance by it of its obligations hereunder and thereunder
have been duly and validly authorized by all requisite corporate or partnership
action on the part of such Northwest Party. This Agreement and each Ancillary
Agreement to which it is a party have been duly executed and delivered by each
of the Northwest Parties and (assuming due authorization, execution and delivery
thereof by the other parties thereto) constitute the legal, valid and binding
obligations of such Northwest Party, enforceable against such Northwest Party in
accordance with their respective terms, subject to bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar Laws
relating to or affecting the enforcement of creditors' rights generally and
legal principles of general applicability governing the availability of
equitable remedies (whether considered in a proceeding in equity, at law or
under applicable legal codes).
Section 7.03. Approvals. Except for applicable Laws, if any,
noncompliance with which could not reasonably be expected to prevent any of the
Northwest Parties from performing its obligations under this Agreement and each
Ancillary Agreement to which it is a party in all material respects, and the
review by the U.S. Department of Transportation of the Amendment of Alliance
Agreement pursuant to Title 49 U.S.C. Section 41720, no filing or registration
with, no waiting period imposed by and no Authorization of, any Governmental
Authority is required under any Laws applicable to any of the Northwest Parties
to permit any of the Northwest Parties to execute, deliver or perform its
obligations under this Agreement or any Ancillary Agreement to which it is a
party or to consummate the transactions contemplated hereby and thereby.
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Section 7.04. No Violation. Assuming effectuation of all filings and
registrations and receipt of all Authorizations described in Section 7.03,
neither the execution and delivery by each Northwest Party of this Agreement or
an Ancillary Agreement to which it is a party nor the performance by the
Northwest Parties of their respective obligations hereunder or thereunder will
(a) violate or breach the terms of or cause a default under (i) any federal or
Minnesota Laws applicable to any Northwest Party, (ii) the certificate of
incorporation, bylaws or partnership agreement of any Northwest Party or (iii)
any contract or agreement to which a Northwest Party or any of their respective
Affiliates is a party or by which it or any of its properties or assets is bound
or (b), with the passage of time, the giving of notice or the taking of any
action by a third Person, have any of the effects set forth in clause (a) of
this Section 7.04, except in any such case for any matters described in
subclause (i) or (iii) of clause (a) of this Section 7.04 that could not
reasonably be expected to prevent the Northwest Parties from performing their
obligations under this Agreement or any Ancillary Agreement in all material
respects.
Section 7.05. Class A Shares. Other than the Repurchased Class A Shares
and the additional 1,975,945 shares of Class A Common Stock owned as of the date
of this Agreement, NW Parent and its Affiliates do not own, beneficially or of
record, any Equity Securities of Continental; provided, that one or more of the
Northwest Parties has a limited proxy to vote certain shares as set forth in
Section 4.2 of the Investment Agreement. NW Parent, directly or through one or
more wholly owned Subsidiaries, has good and valid title to the Repurchased
Class A Shares, and the additional 1,975,945 shares of Class A Common Stock
owned as of the date of this Agreement, free and clear of any Liens (assuming
the effectiveness of the Ancillary Agreements in accordance with their terms).
Assuming Continental has the requisite power and authority to be the lawful
owner of the Repurchased Class A Shares, upon delivery to Continental at the
Closing of certificates representing the Repurchased Class A Shares, duly
endorsed for the transfer to Continental, and upon NW Parent's and NW Holdings'
(in proportion to their respective holdings of Repurchased Class A Shares)
receipt of the Class A Purchase Price, good and valid title to the Repurchased
Class A Shares will pass to Continental, free and clear of any Liens (assuming
the effectiveness of the Ancillary Agreements in accordance with their terms),
other than those arising from acts of Continental or its Affiliates. Other than
this Agreement, there are no outstanding subscriptions, options, warrants,
rights, conversion rights, rights of first refusal or other agreements or
commitments obligating the Northwest Parties or the trustee of the Voting Trust
to offer, sell, transfer or otherwise dispose of the Repurchased Class A Shares
or otherwise relating to the voting, dividend rights or disposition of the
Repurchased Class A Shares.
Section 7.06. No Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of the Northwest Parties.
ARTICLE VIII.
COVENANTS
Section 8.01. Covenants and Agreements of Continental. Prior to the
Closing, unless otherwise contemplated by this Agreement or consented to in
writing by NW Parent:
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<PAGE> 14
(a) Continental hereby covenants and agrees to promptly prepare
and file with the Securities and Exchange Commission (the
"SEC") a preliminary proxy statement containing (subject to
the fiduciary duties of the Board of Directors under
applicable Laws) the recommendation of the Board of Directors
in favor of the Reclassification, to use its reasonable best
efforts to respond promptly to any comments made by the SEC
with respect to the preliminary proxy statement and to cause a
definitive proxy statement, including any amendment or
supplement thereto (the "PROXY STATEMENT") to be mailed to its
stockholders at the earliest practicable time. Continental
shall promptly provide NW Parent with any comments received
from the SEC relating to the Proxy Statement, shall consult
with NW Parent with respect to the disclosure to be contained
in the Proxy Statement pertaining to the NW Parties and the
transactions contemplated by this Agreement and the Ancillary
Agreements and, except for the disclosure of such information
as may be required by applicable Laws, shall obtain NW
Parent's approval of information contained therein regarding
the Northwest Parties, such approval not to be unreasonably
withheld or delayed;
(b) Continental hereby covenants and agrees to duly call, give
notice of and convene a meeting of its stockholders to be held
as soon as practicable after the date the Proxy Statement is
mailed to its stockholders (the "CONTINENTAL STOCKHOLDERS
MEETING"), for consideration of the Reclassification; provided
that Continental agrees, to the extent permitted by applicable
Law, to adjourn or otherwise postpone, serially if necessary,
the Continental Stockholders Meeting without calling a vote on
any resolution giving effect to the Reclassification until the
earliest practicable date thereafter on which the Closing
Conditions (other than those set forth in Section 4.04(a) and
those that by their nature are to be satisfied only at
Closing) shall have been met;
(c) Continental acknowledges and agrees that NW Parent may
properly direct the Trustee to vote the Equity Securities of
Continental deposited in the Voting Trust pursuant to Section
3(c) of the Voting Trust Agreement, as contemplated pursuant
to Section 8.02(a) below;
(d) Continental undertakes to the Northwest Parties to use
reasonable endeavours to procure the fulfilment of the Closing
Conditions set out in Sections 4.01, 4.03 and 4.04 as soon as
practicable, and Continental shall keep the Northwest Parties
advised of the progress towards the satisfaction of such
Closing Conditions, and Continental will not make the filing
contemplated under Section 5.01(c)(i) prior to the date on
which the Closing occurs;
(e) from the date hereof through the Closing Date, Continental
will not declare or pay any dividend or make any distribution
with respect to its capital stock except as expressly provided
under this Agreement; and
(f) Continental hereby covenants and agrees to use its reasonable
best efforts to obtain for both itself and the Northwest
Parties that are defendants in U.S. v.
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<PAGE> 15
Northwest Airlines Corp. and Continental Airlines Inc., civil
action no. 98-74611, pending in the United States District
Court for the Eastern District of Michigan (the "DOJ Action")
a prompt adjournment of the DOJ Action pending Closing and,
upon or promptly after Closing, a dismissal of the DOJ Action.
In the event the DOJ Action is not dismissed as to both
Continental and such Northwest Parties upon or promptly after
Closing, Continental covenants and agrees to take all
reasonable steps in the context of the DOJ Action to ensure
that the transactions contemplated by this Agreement are
fulfilled and to the extent permitted by law to cooperate
reasonably with the Northwest Parties in the defense of the
DOJ Action.
Section 8.02. Covenants of the Northwest Parties. Prior to the Closing,
unless otherwise contemplated by this Agreement or consented to in writing by
Continental:
(a) NW Parent hereby covenants and agrees to execute the
Irrevocable Instruction Pursuant to Voting Trust Agreement not
later than immediately prior to the vote on any resolution
giving effect to the Reclassification at the Continental
Stockholders Meeting called by Continental pursuant to Section
8.01(b) above, and that it will not, and will cause its
Affiliates to not, take any action that would rescind or
render ineffective such Irrevocable Instruction Pursuant to
Voting Trust Agreement, and that it will, and will cause its
Affiliates to, take all such other necessary action to ensure
that Equity Securities of Continental beneficially owned by NW
Parent and its Affiliates on the date hereof or hereafter
acquired and entitled to vote at the Continental Stockholders
Meeting are voted in favor of the Reclassification, including
without limitation all Equity Securities of Continental that
have been deposited in the Voting Trust;
(b) each of the Northwest Parties hereby covenants and agrees not
to assign, transfer or otherwise encumber any shares of Class
A Common Stock owned by such party as of the date hereof,
otherwise than pursuant to Article V or as permitted by
Section 11.05, and each of the Northwest Parties hereby
covenants and agrees not to exercise its right to convert any
of such shares into Class B Common Stock, Class D Common Stock
or otherwise;
(c) each of the Northwest Parties undertakes to Continental to use
reasonable endeavours to procure the fulfilment of the Closing
Conditions set out in Sections 4.01, 4.02 and 4.04 as soon as
practicable and cause the transactions contemplated by this
Agreement to be timely consummated, and the Northwest Parties
shall keep Continental advised of the progress towards the
satisfaction of such Closing Conditions; and
(d) each of the Northwest Parties hereby covenants and agrees to
use its reasonable best efforts to obtain for Continental and
the Northwest Parties that are defendants in the DOJ Action, a
prompt adjournment of the DOJ Action pending Closing and, upon
or promptly after Closing, a dismissal of the DOJ Action. In
the event the DOJ Action is not dismissed as to both
Continental and such Northwest
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<PAGE> 16
Parties upon or promptly after Closing, each of the Northwest
Parties covenants and agrees to take all reasonable steps in
the context of the DOJ Action to ensure that the transactions
contemplated by this Agreement are fulfilled and to the extent
permitted by law to cooperate reasonably with Continental in
the defense of the DOJ Action.
ARTICLE IX.
INDEMNIFICATION
Section 9.01. Survival of Representations, Warranties and Covenants.
The representations, warranties, covenants and agreements of the parties to this
Agreement contained herein shall survive the Closing and any investigation by
the parties with respect thereto.
Section 9.02. General Indemnification. To the fullest extent permitted
by Law and subject to the terms of Sections 9.03 and 9.04, Continental will
indemnify, defend and hold harmless the Northwest Parties and their respective
directors, officers, stockholders, partners, employees, agents, representatives,
successors, permitted transferees and permitted assigns, from and against all
out-of-pocket costs and expenses (including, without limitation, reasonable
legal fees and expenses incurred in connection with Claims (as defined below)),
including amounts paid to third parties (which shall be deemed to include
Continental and its Affiliates, other than the Northwest Parties) in respect of
settlements or judgments resulting from or arising in connection with claims
made by holders, former holders, beneficial owners or former beneficial owners
of Equity Securities of Continental (other than the Northwest Parties, 1992 Air,
Inc. and their respective Affiliates) in their capacity as holders of such
Equity Securities, or by, on behalf of or in the name of Continental (each, a
"CLAIM", and collectively, "CLAIMS") based upon or in connection with this
Agreement or the transactions contemplated hereby; provided, however, that
Continental shall have no obligation to indemnify any party hereunder to the
extent, but only to the extent, the Claim relates to a breach by any of the
Northwest Parties of this Agreement or any Ancillary Agreement or any other
agreement to which any of the Northwest Parties or their respective Affiliates
is a party.
Section 9.03. Procedures. For purposes of this Article IX, the term
"INDEMNIFYING PARTY" when used in connection with a particular Claim means
Continental, which is the person having an obligation to indemnify with respect
to such Claim pursuant to this Article IX, and the term "INDEMNIFIED PARTY" when
used in connection with a particular Claim means the person (whether one or
more) having the right to be indemnified with respect to such Claim pursuant to
this Article IX. The following procedures will apply to the indemnification
obligations set forth in this Agreement:
(a) Promptly after receipt of written notice of a Claim involving
a third party, the Indemnified Party against whom such Claim
is asserted will give the Indemnifying Party written notice of
any such Claim; provided, however, that any failure or delay
in providing such notice to the Indemnifying Party will not
relieve the Indemnifying Party of any obligations under this
Article IX except to the extent and only to the extent the
Indemnifying Party was actually and materially prejudiced by
such delay or failure. The Indemnifying Party will promptly
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<PAGE> 17
designate counsel chosen by it and reasonably acceptable to
the Indemnified Party to represent the Indemnified Party in
connection with such Claim and the Indemnifying Party will pay
all costs of investigation, litigation or arbitration incurred
in connection with such Claim including, without limitation,
fees and expenses of such counsel. The Indemnifying Party will
have the right to undertake the defense, compromise or
settlement of such Claim (subject to paragraph (b) below), and
the Indemnifying Party will not be liable for the fees or
expenses of separate counsel for the Indemnified Party, unless
the employment of such counsel shall have been authorized in
writing by the Indemnifying Party in connection with the
defense of such action or the Indemnifying Party shall not
have employed counsel reasonably satisfactory to the
Indemnified Party to have charge of the defense of such action
or, based upon written advice of counsel, the Indemnified
Party shall have reasonably concluded that there may be
defenses available to it that are different from those
available to the Indemnifying Party or that a material
conflict of interest or material potential conflict of
interest exists (in which case the Indemnifying Party shall
not have the right to direct the defense of such action on
behalf of the Indemnified Party), in any of which cases the
reasonable fees and expenses of counsel for the Indemnified
Party shall be borne by the Indemnifying Party and paid as
incurred (it being understood, however, that the Indemnifying
Party shall not be liable for the expenses of more than one
separate counsel (other than local counsel) in any one action
or series of related actions in the same jurisdiction
representing the Indemnified Parties who are parties to such
action). The Indemnified Party will use its reasonable efforts
to cooperate fully with respect to the defense of any Claim.
If after the passage of a reasonable period of time after
notice of any Claim, the Indemnifying Party has not initiated
a defense against such Claim, the Indemnified Party will have
the right, upon written notice to the Indemnifying Party, to
undertake the defense, compromise or settlement of such Claim
at any time prior to settlement, compromise or final
determination thereof and any action so taken by the
Indemnified Party with regard to such defense, compromise or
settlement will be deemed to be within the protection afforded
by this Agreement unless a court of competent jurisdiction
makes a final determination that the Indemnified Party is not
entitled to indemnification hereunder with respect to such
Claim; provided, however, that any settlement of any such
Claim shall require the prior written consent of the
Indemnifying Party, which consent shall not be unreasonably
withheld or delayed.
(b) Anything in this Section 9.03 to the contrary notwithstanding,
the Indemnifying Party will not settle or compromise any Claim
or consent to the entry of any judgment that does not include
as an unconditional term thereof the giving by the claimant or
plaintiff to the Indemnified Party a full, irrevocable and
unconditional release from all liability in respect of such
Claim; provided that if the terms of such settlement,
compromise or judgment adversely affects any of the rights
granted to such Indemnified Party herein, in any of the
Ancillary Agreements, in the Amended and Restated Certificate
of Incorporation or in the Series B Certificate of
Designation, the Indemnifying Party will not settle or
compromise
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<PAGE> 18
such Claim or consent to the entry of judgment without the
written consent of the Indemnified Party, which consent shall
not be unreasonably withheld or delayed. In the event that
there is more than one Indemnified Party with respect to any
Claim, any notice contemplated by this Section 9.03 to be
given to the Indemnified Party will be deemed to be given for
purposes hereof if it is given to any Indemnified Party. No
Indemnifying Party shall be liable for any settlement of any
Claim effected without its written consent (which consent
shall not be unreasonably withheld), but if settled with its
written consent, the Indemnifying Party agrees to indemnify
and hold harmless any Indemnified Party from and against any
loss or liability by reason of such settlement.
Section 9.04. Consequential Damages. Other than (i) in the case of
Continental breaching its obligation expressed in the last clause of Section
8.01(d) or (ii) in the case of NW Parent breaching its obligations under Section
8.02(a) or 8.02(b), in each of which case the provisions of this Section 9.04
shall not apply, no party to this Agreement nor any of their respective
Affiliates or Representatives shall be liable to any other party hereto or any
of its Affiliates or Representatives for claims for punitive, special,
exemplary, incidental, indirect or consequential damages connected with this
Agreement, regardless of whether a claim is based on contract, tort (including
negligence), strict liability, violation of any applicable deceptive trade
practices act or similar Law or any other legal or equitable principle.
ARTICLE X.
TERMINATION, AMENDMENT AND WAIVER
Section 10.01. Termination. This Agreement may be terminated at any
time prior to the Closing:
(a) by mutual written consent of Continental and NW Parent;
(b) by Continental, upon a Material breach of any representation,
warranty, covenant or agreement on the part of any of the
Northwest Parties set forth in this Agreement or if any such
representation or warranty of the Northwest Parties shall have
become untrue, in either case which breach or untruth could
reasonably be expected to have a Material Adverse Effect on
the ability of any of the Northwest Parties to consummate the
transactions contemplated by this Agreement (a "TERMINATING NW
BREACH"); provided, however, that, if such Terminating NW
Breach is curable by any of the Northwest Parties through the
exercise of its commercially reasonable efforts and for so
long as the Northwest Parties continue to exercise such
reasonable efforts, Continental may not terminate this
Agreement under this Section 10.01(b);
(c) by NW Parent, upon a Material breach of any representation,
warranty, covenant or agreement on the part of Continental set
forth in this Agreement or if any representation or warranty
of Continental shall have become untrue, in either case in
either case which breach or untruth could reasonably be
expected to have a Material Adverse Effect on the ability of
Continental to consummate the
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<PAGE> 19
transactions contemplated by this Agreement (a "TERMINATING
CONTINENTAL Breach"); provided, however, that, if such
Terminating Continental Breach is curable by Continental
through the exercise of its commercially reasonable efforts
and for so long as Continental continues to exercise such
reasonable efforts, NW Parent may not terminate this Agreement
under this Section 10.01(c);
(d) by either Continental or NW Parent, if the Closing
contemplated hereby shall not have occurred on or before March
31, 2001 (the "TERMINATION DATE"); provided, however, that the
right to terminate this Agreement under this Section 10.01(d)
shall not be available to any party whose failure to fulfil
any obligation under this Agreement has been, directly or
indirectly, the cause of, or resulted in, the failure of the
Closing to occur on or before such date.
The right of any party hereto to terminate this Agreement pursuant to this
Section 10.01 shall remain operative and in full force and effect regardless of
any investigation made by or on behalf of any party hereto, any Person
controlling any such party or any of their directors, officers, stockholders,
partners, employees, agents and representatives, whether prior to or after the
execution of this Agreement.
Section 10.02. Effect of Termination. Except for Section 9.04 and
Articles X and XI of this Agreement, this Agreement shall, upon termination
hereof pursuant to Section 10.01 or 11.03, forthwith become void and (i) there
shall be no liability on the part of Continental, the Northwest Parties or any
of their respective Affiliates, officers, directors, employees or agents to any
other party and (ii) all rights and obligations of any party hereto shall cease;
provided, however, that nothing herein shall relieve Continental or any
Northwest Party from liability (as limited by Section 9.04) for any
misrepresentation, or breach of any covenant or agreement, under this Agreement.
Section 10.03. Amendment. This Agreement may not be amended except by
an instrument in writing authorized and signed by Continental and the Northwest
Parties.
Section 10.04. Waiver. At any time prior to the Closing, either
Continental or NW Parent (on behalf of itself and the Northwest Parties) may (a)
extend the time for the performance of any of the obligations or other acts of
the other (including, in the case of NW Parent, the other Northwest Parties),
(b) waive any inaccuracies in the representations and warranties of the other
(including, in the case of NW Parent, the other Northwest Parties) contained
herein or in any document delivered pursuant hereto that are made for its
benefit (or the benefit of the other Northwest Parties) and (c) waive compliance
by the other (including, in the case of NW Parent, the other Northwest Parties)
with any of the agreements or conditions contained herein. Any such extension or
waiver shall be valid only if set forth in an instrument in writing signed by
Continental or NW Parent, as the case may be.
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<PAGE> 20
ARTICLE XI.
MISCELLANEOUS
Section 11.01. Notices. All notices and other communications given or
made pursuant hereto shall be in writing and shall be deemed to have been duly
given if delivered personally, mailed by registered or certified mail (postage
prepaid, return receipt requested) to the parties at the following addresses or
sent by electronic transmission to the telecopier number specified below:
If to Continental, to:
Continental Airlines, Inc.
1600 Smith Street, Department HQSEO
Houston, Texas 77002
Attention: General Counsel and Chief Financial Officer
Telephone: (713) 324-2948
Telecopier: (713) 324-2687
Copy to:
Vinson & Elkins L.L.P.
1001 Fannin Street
Suite 2300
Houston, Texas 77002
Attention: Kevin P. Lewis
Telephone: (713) 758-3884
Telecopier: (713) 615-5967
If to the Northwest Parties, to:
Northwest Airlines Corporation
5101 Northwest Drive
St. Paul, Minnesota 55111
Attention: General Counsel
Telephone: (612) 727-6500
Telecopier: (612) 727-4839
Copy to:
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017-3954
Attention: Wilson S. Neely
Telephone: (212) 455-7063
Telecopier: (212) 455-2502
or to such other address or telecopier number as Continental or NW Parent may,
from time to time, designate in a written notice given in a like manner. Notice
given by telecopier shall be deemed delivered on the day the sender receives
telecopier confirmation that such notice was
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<PAGE> 21
received at the telecopier number of the addressee. Notice given by mail as set
out above shall be deemed delivered five (5) days after the date the same is
postmarked.
Section 11.02. Headings. The headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
Section 11.03. Severability. If any term or other provision of this
Agreement, any of the Ancillary Agreements, the Amended and Restated Certificate
of Incorporation or the Series B Certificate of Designations is invalid, illegal
or incapable of being enforced by any rule of law or public policy, all other
terms and provisions of this Agreement and such other documents shall
nevertheless remain in full force and effect so long as the invalidity,
illegality or unenforceability of such term or provision is not materially
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement or the affected document so as
to effect the original intent of the parties as closely as possible in an
acceptable manner to the end that transactions contemplated hereby are
fulfilled, but, absent mutual agreement, this Agreement shall nonetheless be
terminable in the sole discretion of the party materially and adversely affected
as described above.
Section 11.04. Entire Agreement. This Agreement (together with the
Annexes and Exhibits hereto) constitutes the entire agreement of the parties,
and supersedes all prior agreements and undertakings, both written and oral,
among the parties, with respect to the subject matter hereof, and the Agreement
in Principle, dated as of November 5, 2000, among Continental, NW Parent, NW
Holdings and Northwest, including the Class A Recapitalization Term Sheet
attached thereto, is hereby terminated and has no further force and effect.
Section 11.05. Assignment. This Agreement shall not be assigned by any
party hereto except by operation of Law; provided that notwithstanding the
foregoing, with respect to the obligations of NW Parent and NW Holdings set
forth in Section 2.01, the Northwest Parties shall be entitled to assign in
whole or in part such obligations among themselves, but only to an assignee that
shall remain an Affiliate of such assignor at all times prior to the Closing and
so long as each assignor remains, and each assignee becomes, liable under such
Section 2.01 and each other covenant, agreement, representation and warranty
relating thereto in this Agreement and, if appropriate, any Ancillary Agreement,
or in any such event the assignment shall be null and void.
Section 11.06. Parties in Interest. This Agreement shall be binding
upon and inure solely to the benefit of each party hereto and its successors,
and nothing in this Agreement, express or implied, is intended to or shall
confer upon any other Person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement.
Section 11.07. Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of any party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty, covenant or
agreement herein, nor shall any single or partial exercise of any such right
preclude
-18-
<PAGE> 22
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement are cumulative with, and not exclusive of, any rights or
remedies otherwise available.
Section 11.08. GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT
SHALL BE CONSTRUED (BOTH AS TO VALIDITY AND TO PERFORMANCE) UNDER THE LAW OF THE
STATE OF DELAWARE WITHOUT REFERENCE TO ANY CONFLICT OF LAWS PRINCIPLES THAT
WOULD PROVIDE FOR THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION. ANY
JUDICIAL PROCEEDING BROUGHT AGAINST ANY OF THE PARTIES HERETO WITH RESPECT TO
THIS AGREEMENT SHALL BE BROUGHT EXCLUSIVELY IN (i) THE CHANCERY COURT IN THE
STATE OF DELAWARE, OR (ii) IF THE CHANCERY COURT DOES NOT HAVE JURISDICTION,
THEN ANY OTHER DELAWARE STATE COURT OR FEDERAL DISTRICT COURT FOR THE DISTRICT
OF DELAWARE HAVING JURISDICTION OVER SUCH MATTER. EACH PARTY HERETO HEREBY
IRREVOCABLY CONSENTS, FOR ITSELF AND ITS LEGAL REPRESENTATIVES, PARTNERS,
SUCCESSORS AND ASSIGNS, TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS FOR ALL
PURPOSES IN CONNECTION WITH ANY ACTION OR PROCEEDING WHICH ARISES FROM OR
RELATES TO THIS AGREEMENT, HEREBY WAIVES ANY DEFENSE OR OPPOSITION TO SUCH
JURISDICTION, AND HEREBY WAIVES ANY RIGHTS IT MAY HAVE TO PERSONAL SERVICE OF
SUMMONS, COMPLAINT, OR OTHER PROCESS IN CONNECTION THEREWITH, AND AGREES THAT
SERVICE MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH PARTY AND
SENT IN ACCORDANCE WITH THE PROVISIONS OF SECTION 11.01 HEREOF.
Section 11.09. Specific Performance. The parties hereby acknowledge and
agree that the failure of any party to this Agreement timely to perform its
agreements and covenants hereunder will cause substantial and irreparable injury
to the other parties to this Agreement for which damages, even if available,
will not be an adequate remedy. Accordingly, each of the parties hereto hereby
consents to the granting of equitable relief (including specific performance and
injunctive relief) by any court having jurisdiction over the matter to enforce
any party's obligations hereunder. The parties further agree to waive any
requirement for the securing or posting of any bond in connection with the
obtaining of any such equitable relief, and that this Section 11.09 is without
prejudice to any other rights that the parties hereto may have for any failure
to perform this Agreement. The parties further agree not to assert in any
proceeding that grounds for any equitable relief are not satisfied. The parties
acknowledge that because of the particular and unique voting control of the
Class A Common Stock held by the Northwest Parties as of the date of this
Agreement and the Series B Preferred Stock to be received by NW Parent in
accordance with this Agreement, the making available of equitable remedies
(including specific performance and injunctive relief) in this Agreement was a
condition to each party's entering into this Agreement.
Section 11.10. Counterparts. This Agreement may be executed in multiple
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
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<PAGE> 23
Section 11.11. Other Rights. Subject to the provisions of this
Agreement, pending consummation of the transactions contemplated by this
Agreement, NW Parent remains entitled to the rights and benefits provided, and
remains subject to the obligations imposed, under the Governance Agreement and
the Voting Trust Agreement dated as of November 20, 1998, as amended.
Section 11.12. Further Assurances. Each of the parties to this
Agreement will cooperate and use its reasonable efforts to take or cause to be
taken all reasonable actions, to cooperate reasonably with the other parties
hereto with respect to such actions, and to do or cause to be done all things
reasonably necessary or advisable to consummate and make effective the
transactions contemplated by this Agreement.
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<PAGE> 24
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.
CONTINENTAL AIRLINES, INC.
By:
------------------------------
Name: Jeffery A. Smisek
Title: Executive Vice President, General Counsel
and Secretary
NORTHWEST AIRLINES CORPORATION
By:
------------------------------
Name: Douglas M. Steenland
Title: Executive Vice President, General Counsel
and Secretary
NORTHWEST AIRLINES HOLDINGS CORPORATION
By:
------------------------------
Name: Douglas M. Steenland
Title: Executive Vice President, General Counsel
and Secretary
NORTHWEST AIRLINES, INC.
By:
------------------------------
Name: Douglas M. Steenland
Title: Executive Vice President, General Counsel
and Secretary
AIR PARTNERS, L.P.
By: Northwest Airlines, Inc., its General Partner
By:
------------------------------
Name: Douglas M. Steenland
Title: Executive Vice President, General Counsel
and Secretary
[SIGNATURE PAGE TO OMNIBUS AGREEMENT]
<PAGE> 25
ANNEX A
DEFINITIONS
"1992 Air, Inc." means 1992 Air, Inc., a Texas corporation.
"Affiliate" means a Person controlling, controlled by or under common
control with another Person. For this purpose, "control" means the ability to
direct the management and affairs of a Person, whether through ownership of
securities, by contract or otherwise.
"Agreement" has the meaning ascribed to such term in the introductory
paragraph of this document.
"Air Partners" has the meaning ascribed to such term in the
introductory paragraph of this document.
"Alliance Agreement" means that certain Master Alliance Agreement,
dated as of January 25, 1998, between Continental and Northwest, as amended from
time to time.
"Amended and Restated Certificate of Incorporation" means the Amended
and Restated Certificate of Incorporation, in the form attached hereto as
Exhibit 1.
"Amended and Restated Rights Agreement" means the Amended and Restated
Rights Agreement, in the form attached hereto as Exhibit 9.
"Amendment of Alliance Agreement" has the meaning set forth in Section
4.01.
"Ancillary Agreement" means any of the Termination of Amended and
Restated Governance Agreement, Termination of Supplement Agreement, Amended and
Restated Rights Agreement, Amendment of Alliance Agreement, Registration Rights
Amendment, Reoffer Purchase Agreement, Standstill Agreement or Voting Trust
Termination Agreement; collectively, the "Ancillary Agreements."
"Authorization" means any franchise, permit, license, authorization,
order, certificate, registration or other consent or approval granted by any
Court or Governmental Authority.
"Board of Directors" means the board of directors of Continental.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday unless such day shall be a day when financial institutions in New York
City, Houston or Minneapolis are authorized by Law to close.
"Claim" and "Claims" have the meaning ascribed to such term in Section
9.02.
"Class A Common Stock" means the Class A Common Stock, par value $0.01
per share, of Continental.
Ex A-1
<PAGE> 26
"Class A Purchase Price" has the meaning ascribed to such term in
Section 2.02.
"Class B Common Stock" means the Class B Common Stock, par value $0.01
per share, of Continental.
"Closing" has the meaning ascribed to such term in Section 5.01.
"Closing Conditions" means those conditions to the closing of the
transactions contemplated hereby contained in Article IV.
"Closing Date" has the meaning ascribed to such term in Section 5.01.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Continental" has the meaning ascribed to such term in the introductory
paragraph of this document.
"Continental Stockholders Meeting" has the meaning ascribed to such
term in Section 8.01(b).
"Court" means any court or arbitration tribunal established and
functioning under the Laws of any nation or state, including the United States
of America, or any political subdivision thereof, including any state of the
United States of America.
"DOJ Action" has the meaning ascribed to such term in Section 8.01(f).
"Effective Time" has the meaning ascribed to such term in Section
5.01(c)(i).
"Equity Securities" means the shares of capital stock of a corporation,
or securities that are convertible into or exchangeable for such capital stock,
the partnership interests in a limited partnership or the equity interests in
any other legal entity.
"Form of Transfer Restriction Agreement" means the Form of Transfer
Restriction Agreement in the form attached hereto as Exhibit 11.
"Governmental Authority" means any national, federal, regional, state,
local or other governmental agency, authority, administrative agency, regulatory
body, commission or instrumentality (other than a Court), including any
multinational authority having governmental or quasi-governmental powers.
"Indemnified Party" has the meaning ascribed to such term in Section
9.03.
"Indemnifying Party" has the meaning ascribed to such term in Section
9.03.
Ex A-2
<PAGE> 27
"Investment Agreement" means that certain Investment Agreement, dated
as of January 25, 1998, among NW Parent, NW Holdings, Air Partners, the Partners
of Air Partners, signatory thereto, Bonderman Family Limited Partnership, 1992
Air, Inc. and Air Saipan, Inc., as amended.
"Irrevocable Instruction Pursuant to Voting Trust Agreement" means the
Irrevocable Instruction Pursuant to Voting Trust Agreement in the form attached
hereto as Exhibit 10.
"Laws" means all laws, statutes and ordinances of any nation or state,
including the United States of America, and any political subdivision thereof,
including any state of the United States of America, including all decisions of
Courts having the effect of law in any such jurisdiction.
"Lien" means any mortgage, pledge, security interest, adverse claim,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing), any conditional sale or other title retention agreement, any
lease in the nature thereof or the filing of or agreement to give any financing
statement under the Laws of any jurisdiction.
"Master Alliance Agreement" means that certain Master Alliance
Agreement, dated as of January 25, 1998, between Continental and Northwest, as
amended from time to time.
"Material" means, when used in the context of any representation,
warranty, covenant or condition with respect to a Person, material to the
business, assets, results of operations or condition (financial or otherwise) of
the specified Person and its Subsidiaries, if any, taken as a whole.
"Material Adverse Effect" means, when used in any representation,
warranty, covenant or condition of a Person, any condition, circumstance, event,
change or effect that would be material and adverse to the business, assets,
results of operations or condition (financial or otherwise) of the specified
Person and its Subsidiaries, if any, taken as a whole.
"Northwest" has the meaning ascribed to such term in the introductory
paragraph of this document.
"Northwest Parties" has the meaning ascribed to such term in the
introductory paragraph of this document.
"NW Holdings" has the meaning ascribed to such term in the introductory
paragraph of this document.
"NW Parent" has the meaning ascribed to such term in the introductory
paragraph of this document.
"Order" means any judgment, order or decree of any Court or
Governmental Authority of competent jurisdiction.
Ex A-3
<PAGE> 28
"Person" means an individual, partnership, limited liability company,
corporation, joint stock company, trust, estate, joint venture, association or
unincorporated organization, or any other form of business or professional
entity, but shall not include a Court or Governmental Authority.
"Proxy Statement" has the meaning ascribed to such term in Section
8.01(a).
"Reclassification" has the meaning ascribed to such term in Section
4.04(a).
"Registration Rights Amendment" means the Amendment No. 1 to Amended
and Restated Registration Rights Agreement, substantially in the form attached
hereto as Exhibit 7.
"Regulation" means any regulations, policies, protocols, proclamations,
executive orders and ordinances issued or otherwise applicable under applicable
Laws or issued or promulgated by any Governmental Authority having the effect of
Law or any rule or regulation of any self-regulatory organization, such as a
national Shares exchange in the United States of America.
"Reoffer Purchase Agreement" means that certain Reoffer Purchase
Agreement, dated as of November 15, 2000, among Continental, NW Parent, NW
Holdings, Air Partners and 1992 Air, Inc., substantially in the form attached
hereto as Exhibit 8.
"Repurchased Class A Shares" has the meaning ascribed to such term in
Section 2.01.
"Rights Agreement" means Continental's stockholder rights agreement
adopted November 20, 1998.
"SEC" has the meaning ascribed to such term in Section 8.01(a).
"Series B Certificate of Designations" means the Certificate of
Designations of Series B Preferred Stock of Continental, in the form attached
hereto as Exhibit 3 (and providing for the Form of Transfer Restriction
Agreement).
"Series B Purchase Price" has the meaning ascribed to such term in
Section 3.02.
"Series B Share" means the single share of Series B Preferred Stock,
par value $0.01, of Continental, having the rights, preferences and powers as
set forth in the Series B Certificate of Designations.
"Standstill Agreement" means the Standstill Agreement, substantially in
the form attached hereto as Exhibit 6.
"Subsidiary" means, with respect to a specified Person, any
corporation, partnership, limited liability company, joint venture or other
legal entity of which the specified Person (either alone or through or together
with any other Subsidiary) owns, directly or indirectly, 50 percent or more of
the stock or other equity or partnership interests the holders of which are
generally
Ex A-4
<PAGE> 29
entitled to vote for the election of the board of directors or other governing
body of such corporation or other legal entity.
"Tax" or "Taxes" means all income, profits, franchise, withholding, ad
valorem, employment, social security, disability, occupation, property,
severance and excise taxes imposed on behalf of any Governmental Authority.
"Terminating Continental Breach" has the meaning ascribed to such term
in Section 10.01(c).
"Terminating NW Breach" has the meaning ascribed to such term in
Section 10.01(b).
"Termination Date" has the meaning ascribed to such term in Section
10.01(d).
"Termination of Amended and Restated Governance Agreement" means the
Termination of Amended and Restated Governance Agreement, substantially in the
form attached hereto as Exhibit 4.
"Termination of Supplement Agreement" means the Termination of
Supplement Agreement, substantially in the form attached hereto as Exhibit 5.
"Trustee" means Wilmington Trust Company, a Delaware banking
corporation, in its capacity as trustee under the Voting Trust Agreement.
"United States Dollars" (including "Dollars," "U.S. Dollars" and
"U.S.$") means the lawful currency of the United States of America.
"U.S. GAAP" means accounting principles generally accepted in the
United States of America.
"Voting Trust" means the voting trust established pursuant to the
Voting Trust Agreement.
"Voting Trust Agreement" means that certain Northwest Airlines/Air
Partners Voting Trust Agreement, dated as of November 20, 1998, by and among
Continental, NW Parent, NW Holdings, Air Partners and the Trustee, as amended to
date.
"Voting Trust Termination Agreement" means the Termination of Northwest
Airlines/Air Partners Voting Trust Termination Agreement, substantially in the
form attached hereto as Exhibit 2.
Ex A-5
