Amendment to General Statement of Beneficial Ownership — Schedule 13D
Filing Table of Contents
Document/Exhibit Description Pages Size
1: SC 13D/A Amendment to General Statement of Beneficial 20 76K
Ownership
2: EX-6 Opinion re: Discount on Capital Shares 20 60K
3: EX-7 Opinion re: Liquidation Preference 7 22K
4: EX-8 Opinion re: Tax Matters 21 49K
5: EX-9 Voting Trust Agreement 37 66K
6: EX-10 Material Contract 1 7K
EX-8 — Opinion re: Tax Matters
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Exhibit 8
SUPPLEMENTAL AGREEMENT
Supplemental Agreement dated as of November 20, 1998, among
Continental Airlines, Inc., a Delaware corporation (the "Company"), Newbridge
Parent Corporation, a Delaware corporation (the "Stockholder"), and Northwest
Airlines Corporation, a Delaware corporation that is the holder of all of the
outstanding stock of the Stockholder ("Parent").
WHEREAS, the Parent, the Stockholder and Air Partners, L.P., a Texas
limited partnership ("AP"), have entered into an Investment Agreement dated as
of January 25, 1998, as amended by Amendment No. 1 dated February 27, 1998 and
Amendment No. 2 dated as of the date hereof (the "Investment Agreement"), to
which the Company is not a party and, pursuant to which, among other things, the
Stockholder has acquired the outstanding interests in AP and certain shares of
Class A Common Stock, par value $.01 per share ("Class A Common Stock"), held by
certain affiliates of AP resulting in its Beneficial Ownership of 8,535,868
shares of Class A Common Stock of the Company (the "Stock Purchase");
WHEREAS, the Stockholder and the Parent Beneficially Own an additional
979,000 shares of Class A Common Stock (the "Additional Shares") pursuant to a
Purchase Agreement dated as of March 2, 1998, among the Stockholder, the Parent,
Barlow Investors III, LLC, a California limited liability company, and the
guarantors signatory thereto;
WHEREAS, Northwest Airlines, Inc., an indirect wholly owned subsidiary
of Parent, and the Company have entered into a Master Alliance Agreement dated
as of January 25, 1998 (the "Alliance Agreement");
WHEREAS, as a condition to entering into the Alliance Agreement, the
Company required that the Parent and the Stockholder enter into the Governance
Agreement with the Company dated as of January 25, 1998, which agreement was
subsequently amended by a First Amendment to the Governance Agreement dated as
of March 2, 1998 and is being amended by a Second Amendment dated as of the date
hereof;
WHEREAS, the Parent has been in discussions with the United States
Department of Justice ("DOJ") regarding the terms of the Investment Agreement,
and the Parent and the Company have been in discussions with DOJ regarding the
terms of the Alliance Agreement, and the Governance Agreement (the Investment
Agreement, the Alliance Agreement and the Governance Agreement together, the
"Agreements") in connection with DOJ's antitrust review of the transactions
contemplated by the Agreements;
WHEREAS, the Parent and the Company believe that the transactions
contemplated by the Agreements are procompetitive and beneficial to consumers;
WHEREAS, the DOJ has expressed concerns about the effect on
competition of certain terms of the Agreements;
WHEREAS, the Parent and the Stockholder believe that it is desirable
that certain of the terms and conditions of the Governance Agreement be
supplemented and extended to obviate the concerns of DOJ;
WHEREAS, the Parent and the Stockholder have requested that the
Company enter into this Agreement to obviate the concerns of DOJ; and
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WHEREAS, the Company is willing to agree to enter into this Agreement
to facilitate the prompt closing of the transactions contemplated by the
Investment Agreement and the subsequent realization by the Company and its
stockholders of the expected benefits of the Alliance Agreement.
NOW, THEREFORE, the Company, the Stockholder and the Parent, intending
to be legally bound, hereby agree as follows:
Section 1. Defined Terms. Capitalized terms not otherwise defined
herein shall have their respective meanings set forth in Section 28 of this
Agreement.
Section 2. Independent Directors. During the Supplemental Period,
except in accordance with the proviso to Section 5, the Company, the Parent, the
Stockholder and their respective Affiliates shall take all such actions as are
required under applicable law to cause Independent Directors to constitute at
all times at least a majority of the Board of Directors. At each annual meeting
of stockholders of the Company, or at any time that a vacancy in a seat
previously occupied by an Independent Director on the Board of Directors is to
be filled, the identity of the Independent Director or Directors to stand for
election to the Board of Directors or to fill the vacancy, as the case may be,
shall be determined by a Majority Vote.
Section 3. Transactions Involving the Stockholder. During the
Supplemental Period, any material transaction between the Company and the
Parent, the Stockholder or any of their respective Affiliates, or relating to
this Agreement or the Alliance Agreement, including without limitation, any
amendment, modification or waiver of any provision hereof or thereof, shall not
be taken without the prior approval thereof by a Majority Vote.
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Section 4. Significant Actions. During the Supplemental Period, no
action described in Exhibit 4 of this Agreement may be taken without the prior
approval thereof by a Majority Vote.
Section 5. Voting Generally. During the Supplemental Period, subject
to their obligations in Section 2 above, on all matters other than an
Extraordinary Transaction, and except as permitted by Section 7, the
Stockholder, the Parent and its Affiliates (a) may vote Voting Securities
Beneficially Owned by them representing up to 20% of the Total Voting Power in
their sole discretion and (b) shall cast any remaining Stockholder Voting Power
(i) in the case of votes at a stockholders meeting, in the same proportion as
the votes cast by the other holders of Voting Securities and (ii) in the case of
action by written consent, so that such percentage of Stockholder Voting Power
consented to on any matter equals the percentage of all other outstanding Voting
Securities so consented; provided, that with respect to any election of
directors in respect of which any Person other than the Company is soliciting
proxies, (x) all shares referred to in clause (a) shall no longer be subject to
Section 2, and (y) the Stockholder and the Parent shall cause all shares
referred to in clause (b) to be voted, at the option of the Stockholder, either
(i) as recommended by the Board of Directors or (ii) in the same proportion as
the votes cast by the other holders of Voting Securities.
Section 6. Extraordinary Transactions. During the Supplemental Period,
the Stockholder, the Parent and their respective Affiliates may vote the Voting
Securities Beneficially Owned by them in their sole discretion with respect to
any Extraordinary Transaction.
Section 7. Rights Plan. If, during the Supplemental Period, the
Company redeems the rights issued under the Rights Plan or amends the Rights
Plan to permit a third party
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to acquire Beneficial Ownership of Voting Securities in excess of the 15%
limitation set forth in the definition of "Acquiring Person" in the Rights Plan,
the Stockholder, the Parent and their Affiliates may, after such redemption or
amendment, vote the Voting Securities Beneficially Owned by them in their sole
discretion; provided, that if thereafter no third party has exceeded the 15%
limitation and the Company either adopts a new Eligible Rights Plan or amends
the Rights Plan such that a third party may not acquire Beneficial Ownership of
Voting Securities in excess of the 15% limitation, then the voting restrictions
in Section 2 and Section 5 shall be reinstated.
Section 8. Restrictions on Transfer. During the Supplemental Period,
neither the Stockholder nor the Parent will Transfer or permit any of their
respective Affiliates to Transfer any Voting Securities to any transferee who,
together with its Affiliates and Associates, would, to the knowledge of the
Parent or the Stockholder, Beneficially Own in excess of 10% of the Total Voting
Power as a result of such Transfer; provided, however, that the foregoing shall
not restrict (a) Transfers of Voting Securities by the Stockholder to any of its
controlled Affiliates provided that any such controlled Affiliate agrees in
writing to be bound by the provisions of this Agreement applicable to the
Stockholder, (b) Transfers of Voting Securities pursuant to any tender or
exchange offer to acquire Voting Securities approved and recommended by the
Company's Board of Directors (which recommendation has not been withdrawn), (c)
Transfers of Voting Securities to the Stockholder provided that such Voting
Securities are immediately transferred to the public stockholders of the
Stockholder by means of a pro rata dividend or other pro rata distribution, (d)
Transfers of the Shares by the Voting Trust to the Stockholder upon termination
of the Voting Trust, and (e) Transfers of Voting Securities to the B/C/P Group.
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Section 9. Issuance of Class A Common Stock. During the Supplemental
Period, the Company shall not issue any additional shares of Class A Common
Stock or securities convertible into or exercisable or exchangeable for shares
of Class A Common Stock or enter into any agreement or arrangement to do the
same without giving the Stockholder pre-emptive rights which shall permit the
Stockholder to acquire shares of Class A Common Stock concurrently with any such
issuance.
Section 10. Issuance of Class B Common Stock. During the Supplemental
Period, the Company shall not, without giving the Stockholder pre-emptive
rights, issue shares of Class B Common Stock or securities convertible into or
exercisable or exchangeable for shares of Class B Common Stock except to the
extent that such shares (including underlying shares, in the case of securities
convertible into or exercisable or exchangeable for shares of Class B Common
Stock) (a) in the case of such shares or convertible securities issued for the
purpose of fulfillment of the Company's obligations under any present or future
stock option plan, do not exceed the number of shares issued under such plans
consistent with past practices (which practices, for this purpose, are
understood by the parties to include the issuance of the number of shares of
Class B Common Stock authorized under the Company's 1998 Stock Incentive Plan),
(b) in the case of such shares or convertible securities issued for any other
purpose, do not exceed in the aggregate 10% of the number of shares of Class B
Common Stock outstanding on January 25, 1998 or (c) are issued pursuant to
options, warrants or convertible securities issued and outstanding on, or
commitments to issue such shares that are in effect on, January 25, 1998, and
which were disclosed in Section 4.01(b) of the disclosure schedule to the
Governance Agreement.
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Section 11. Certain Adverse Actions. During the Supplemental Period,
the Company shall not, without the prior written consent of the Parent, amend,
alter or repeal its amended and restated certificate of incorporation or by-laws
so as to eliminate or diminish the ability of stockholders of the Company to act
by written consent or Section 1.10 of the Company's by-laws.
Section 12. No Amendment. During the Supplemental Period, the Company
shall not seek a vote of its stockholders approving any amendment to the
Company's amended and restated certificate of incorporation or by-laws, nor
shall it take any other action, without the consent of the Parent, that would
(a) eliminate Air Partner's right in Section 2(e) of the Company's amended and
restated certificate of incorporation to convert shares of Class A Common Stock
into shares of Class D Common Stock, (b) cause Section 203 of the Delaware
General Corporation Law to be applicable to the Company or (c) adopt an
"interested stockholder" provision.
Section 13. Executive Committee. During the Supplemental Period, the
authority of the Executive Committee of the Company's Board of Directors shall
not be amended or modified from that set forth in the attached "Executive
Committee Charter" without the prior consent of the Parent.
Section 14. Eligible Rights Plan. The Company covenants and agrees
that, during the Supplemental Period, so long as the Parent Beneficially Owns no
less than 15% of the Total Voting Power, the Company shall not (a) amend the
Rights Plan so as to cause it not to constitute an Eligible Rights Plan or (b)
adopt a shareholder rights plan that is not an Eligible Rights Plan.
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Section 15. Post-Ten Year Anniversary Board Composition. After the
earlier to occur of the (a) tenth anniversary of the Closing and (b) a
termination of Sections 2 through 14 of this Agreement under Section 25(b), and
until this Agreement terminates as provided in Section 25(a) (the "Post-Ten Year
Anniversary Period"), the Parent and the Stockholder shall take, and shall cause
to be taken, such actions as are necessary to cause the Board of Directors to
include at least five directors who are independent of and otherwise
unaffiliated with the Parent or the Company and shall not be an officer or an
employee, consultant or advisor (financial, legal or otherwise) of the Parent or
the Company or any of their respective Affiliates, or any person who shall have
served in such capacity within the three-year period immediately preceding the
date such determination is made.
Section 16. Post-Ten Year Anniversary Board Power. During the Post-Ten
Year Anniversary Period, any material transaction between the Company and the
Parent, the Stockholder or any of their respective Affiliates, or relating to
this Agreement or the Alliance Agreement, including without limitation, any
amendment, modification or waiver of any provision hereof or thereof, shall not
be taken without the prior approval thereof by a majority of the five
independent directors described in Section 15.
Section 17. Representations and Warranties of the Company. The Company
represents and warrants to the Parent and the Stockholder that (a) the Company
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and has the corporate power and authority to enter
into this Agreement and to carry out its obligations hereunder, (b) the
execution and delivery of this Agreement by the Company and the consummation by
the Company of the transactions contemplated hereby have been duly authorized by
all necessary corporate action on the part of the Company and by Majority Vote
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and no other corporate proceedings on the part of the Company are necessary to
authorize this Agreement or any of the transactions contemplated hereby, and (c)
this Agreement has been duly executed and delivered by the Company and
constitutes a valid and binding obligation of the Company, and is enforceable
against the Company in accordance with its terms (subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and
other similar laws affecting creditors' rights generally from time to time in
effect and to general principles of equity, including concepts of materiality,
reasonableness, good faith and fair dealing, regardless of whether in a
proceeding at equity or at law).
Section 18. Representations and Warranties of the Parent. The Parent
represents and warrants to the Company that (a) it and the Stockholder are
corporations duly organized, validly existing and in good standing under the
laws of the State of Delaware and each has the power and authority to enter into
this Agreement and to carry out its respective obligations hereunder, (b) the
execution and delivery of this Agreement by the Parent and the Stockholder and
the consummation by each of them of the transactions contemplated hereby have
been duly authorized by all necessary action on their parts and no other
proceedings on their parts are necessary to authorize this Agreement or any of
the transactions contemplated hereby, and (c) this Agreement has been duly
executed and delivered by the Parent and the Stockholder and constitutes a valid
and binding obligation of each of them, and is enforceable against each of them
in accordance with its terms (subject to applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer and other similar laws affecting
creditors' rights generally from time to time in effect and to general
principles of equity, including concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether in a proceeding at equity or at
law).
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Section 19. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including telecopy) and shall be given,
if to the Company, to:
Continental Airlines, Inc.
Dept. HQS-EO
Continental Tower
1600 Smith Street
Houston, Texas 77002
Attention: General Counsel
Fax: (713) 324-2687
with a copy to:
Morris, Nichols, Arsht & Tunnell
1201 N. Market Street
P.O. Box 1347
Wilmington, DE 19899-1347
Attention: A. Gilchrist Sparks, III
Fax: (302) 658-3989
if to the Parent, to:
Northwest Airlines Corporation
5101 Northwest Drive
St. Paul, Minnesota 55111
Attention: General Counsel
Fax: (612) 726-7123
with a copy to:
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017-3954
Attention: Robert L. Friedman, Esq.
Fax: (212) 455-2502
if to the Stockholder, to:
Newbridge Parent Corporation
5101 Northwest Drive
St. Paul, Minnesota 55111
Attention: General Counsel
Fax: (612) 726-7123
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with a copy to:
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017-3954
Attention: Robert L. Friedman, Esq.
Fax: (212) 455-2502
or such address or telecopy number as such party may hereafter specify for the
purpose by notice to the other parties hereto. Each such notice, request or
other communication shall be effective when delivered personally, telegraphed,
or telecopied, or, if mailed, five business days after the date of the mailing.
Section 20. Amendments; No Waivers.
(a) Any provision of this Agreement may be amended or waived if, and
only if, such amendment or waiver has been approved pursuant to Section 3 (or,
during the Post-Ten Year Anniversary Period, pursuant to Section 16) and is in
writing and signed, in the case of an amendment, by the parties hereto, or in
the case of a waiver, by the party against whom the waiver is to be effective.
(b) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
Section 21. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
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Section 22. Governing Law; Consent to Jurisdiction. (a) This Agreement
shall be construed in accordance with and governed by the internal laws of the
State of Delaware.
(b) Any suit, action or proceeding seeking to enforce any provision
of, or based on any matter arising out of or in connection with, this Agreement
or the transactions contemplated hereby may be brought in any federal court
located in the State of Delaware or any Delaware state court, and each of the
parties hereby consents to the exclusive jurisdiction of such courts (and of the
appropriate appellate courts therefrom) in any such suit, action or proceeding
and irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding in any such court or that any such suit, action or
proceeding which is being brought in any such court has been brought in an
inconvenient forum. Process in any such suit, action or proceeding may be served
on any party anywhere in the world, whether within or without the jurisdiction
of any such court. Without limiting the foregoing, each party agrees that
service of process on such party as provided in Section 19 shall be deemed
effective service of process on such party.
Section 23. Counterparts; Effectiveness. This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by the other party hereto.
Section 24. Specific Performance. The parties hereto each acknowledge
and agree that the parties' respective remedies at law for a breach or
threatened breach of any of the provisions of this Agreement would be inadequate
and, in recognition of that fact, agree that, in
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the event of a breach or threatened breach by any of them of the provisions of
this Agreement, in addition to any remedies at law, the aggrieved party, without
posting any bond and without any showing of irreparable injury shall be entitled
to obtain equitable relief in the form of specific performance, a temporary
restraining order, a temporary or permanent injunction or any other equitable
remedy which may then be available.
Section 25. Termination. (a) This Agreement shall terminate upon the
Stockholder and its Affiliates ceasing to Beneficially Own Voting Securities
representing at least 10% of the Fully Diluted Voting Power.
(b) Sections 2 through 14 of this Agreement shall terminate upon (i) a
termination by the Company of the Alliance Agreement other than a bona fide
termination in accordance with Section 16(b) of Exhibit C thereto, or (ii) a
final determination in an arbitration conducted in accordance with Section 22(c)
of the Alliance Agreement that the Company has breached any material provision
of the Alliance Agreement and that such breach gives rise to the right of
Northwest Airlines, Inc. to terminate the Alliance Agreement in accordance with
Section 16(b)(i) of Exhibit C thereto.
Section 26. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, provided that
the parties hereto shall negotiate in good faith to attempt to place the parties
in the same position as they would have been in had such provision not been held
to be invalid, void or unenforceable.
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Section 27. Non-Exclusivity. No action or transaction taken in
accordance with the express provisions of, and as expressly permitted by, any
provision of this Agreement shall be treated as a breach of any other provision
of this Agreement, notwithstanding that such action or transaction shall not
have been expressly excepted from such latter provision.
Section 28. Definitions. For purposes of this Agreement, the following
terms shall have the following meanings:
"Affiliate" shall have the meaning set forth in Rule 12b-2 under the
Exchange Act (as in effect on January 25, 1998).
"Alliance Agreement" shall have the meaning set forth in the recitals
hereto.
"Associate" shall have the meaning set forth in Rule 12b-2 under the
Exchange Act (as in effect on January 25, 1998).
"B/C/P Group" shall mean David Bonderman, James Coulter or William S.
Price, III, or any Person with respect to which one or more of them (i) directly
or indirectly controls at least 50.1% of the voting power, (ii) directly or
indirectly controls at least 50.1% of the equity, or (iii) directly or
indirectly controls in a manner substantially similar to the control that the
general partner of Air Partners has over Air Partners pursuant to and as
provided in the "Partnership Agreement" (as defined in the Investment
Agreement), which Persons described in clause (iii) shall include 1998 CAI
Partners, L.P., a Texas limited partnership, under its partnership agreement and
ownership structure in effect on the date hereof.
"Beneficially Own" or "Beneficial Ownership" with respect to any
securities shall mean having "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Exchange Act), including pursuant to
any agreement, arrangement or understanding, whether or not in writing.
14
"Board of Directors" shall mean the board of directors of the Company.
"Class A Common Stock" shall mean the Class A Common Stock, par value
$0.01 per share, of the Company.
"Class B Common Stock" shall mean the Class B Common Stock, par value
$0.01 per share, of the Company.
"Class D Common Stock" shall mean the Class D Common Stock, par value
$0.01 per share, of the Company.
"Closing" shall mean the closing of the Stock Purchase under the
Investment Agreement.
"Company Common Stock" shall mean Class A Common Stock, Class B Common
Stock or Class D Common Stock.
"Eligible Rights Plan" shall have the meaning set forth in Section
8.01(c) of the Governance Agreement.
"Exchange Act" shall mean the Securities Exchange Act of 1934.
"Extraordinary Transaction" shall mean (a) a merger, reorganization,
share exchange, consolidation, business combination, recapitalization,
liquidation, dissolution or similar transaction involving the Company, any sale
of all or substantially all of the Company's assets or any issuance of Voting
Securities that would represent in excess of 20% of the Total Voting Power prior
to such issuance, including any of the foregoing involving the Stockholder or
the Parent or (b) any amendment to the Company's amended and restated
certificate of
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incorporation or by-laws that would materially and adversely affect the
Stockholder (including through its effect on the Alliance Agreement and the
rights of the Voting Securities Beneficially Owned by the Stockholder).
"Fully Diluted Voting Power" of any Person shall be calculated by
dividing (a) the sum of (i) ten times the aggregate number of shares of Company
Class A Common Stock beneficially owned by such Person (assuming exercise of all
outstanding securities held by such Person that are convertible into or
exercisable or exchangeable for shares of Company Class A Common Stock) and (ii)
the number of shares of Company Class B Common Stock beneficially owned by such
Person (assuming exercise of all outstanding securities held by such Person that
are convertible into or exercisable or exchangeable for shares of Company Class
B Common Stock) by (b) the sum of (i) ten times the aggregate number of
outstanding shares of Company Class A Common Stock (assuming the exercise of all
outstanding securities convertible into or exercisable or exchangeable for
shares of Company Class A Common Stock) and (ii) the aggregate number of
outstanding shares of Company Class B Common Stock (assuming the exercise of all
outstanding securities convertible into or exercisable or exchangeable for
shares of Company Class B Common Stock).
"Governance Agreement" shall mean the Governance Agreement between the
Company, the Parent and the Stockholder dated as of January 25, 1998, as amended
by the First Amendment to the Governance Agreement dated as of March 25, 1998
and the Second Amendment to the Governance Agreement dated as of the date
hereof.
"Independent Director" shall mean any person listed on Exhibit 2.01 to
the Governance Agreement, (ii) and any other person selected as an Independent
Director in
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accordance with Section 2 of this Agreement and (iii) any other person, who
is elected to the Board of Directors in an election of directors in respect of
which any Person other than the Company is soliciting proxies; provided that any
such other person so selected shall be independent of and otherwise unaffiliated
with the Parent or the Company (other than as an Independent Director), and
shall not be an officer or an employee, consultant or advisor (financial, legal
or other) of the Parent or the Company or any of their respective Affiliates, or
any person who shall have served in any such capacity within the three-year
period immediately preceding the date such determination is made.
"Investment Agreement" shall have the meaning set forth in the
recitals hereto.
"Majority Vote" shall mean the affirmative vote of a majority of the
Board of Directors, including the affirmative vote of a majority of the
Independent Directors.
"Person" shall mean any individual, partnership (limited or general),
joint venture, limited liability company, corporation, trust, business trust,
unincorporated organization, government or department or agency of a government.
"Rights Plan" shall mean the Rights Agreement dated as of November 20,
1998 between the Company and Harris Trust and Savings Bank.
"Stockholder Voting Power" at any time shall mean the aggregate voting
power in the general election of directors of all Voting Securities then
Beneficially Owned by the Stockholder and its Affiliates.
"Stock Purchase" shall have the meaning set forth in the recitals
hereto.
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"Subsidiary" shall mean, as to any Person, any Person at least a
majority of the shares of stock or other equity interests of which having
general voting power under ordinary circumstances to elect a majority of the
board of directors (or comparable governing body) thereof (irrespective of
whether or not at the time stock or equity of any other class or classes shall
have or might have voting power by reason of the happening of any contingency)
is, at the time as of which the determination is being made, owned by such
Person, or one or more of its Subsidiaries or by such Person and one or more of
its Subsidiaries.
"Supplemental Period" shall mean the period beginning on the sixth
anniversary of the Closing and ending on the tenth anniversary of the Closing.
"Total Voting Power" at any time shall mean the total combined
voting power in the general election of directors of all the Voting
Securities then outstanding.
"Transfer" shall mean any sale, exchange, transfer, pledge,
encumbrance or other disposition, and "to Transfer" shall mean to sell,
exchange, transfer, pledge, encumber or otherwise dispose of.
"Voting Securities" shall mean at any time shares of any class of
capital stock of the Company which are then entitled to vote generally in the
election of directors including, without limitation, the Class A Common Stock
and the Class B Common Stock.
[Remainder of this page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first referred to above.
NORTHWEST AIRLINES CORPORATION
By: /s/ Douglas M. Steenland
-----------------------------------
Douglas M. Steenland
Executive Vice President, General Counsel
and Secretary
NEWBRIDGE PARENT CORPORATION
By: /s/ Douglas M. Steenland
-----------------------------------
Douglas M. Steenland
Vice President, Secretary and Assistant
Treasurer
CONTINENTAL AIRLINES, INC.
By: /s/ Jeffery A. Smisek
-----------------------------------
Jeffery A. Smisek
Executive Vice President, General Counsel
and Secretary
[Signature Page for Supplemental Agreement]
EXHIBIT 4 TO SUPPLEMENTAL AGREEMENT
(Significant Actions)
1. Any amendment to the certificate of incorporation or by-laws of the
Company.
2. Any reclassification, combination, split, subdivision, redemption,
purchase or other acquisition, directly or indirectly, of any debt or equity
security of the Company or any Subsidiary of the Company (other than pursuant to
existing stock option plans or agreements or by or on behalf of any existing
employee benefit plan of the Company).
3. Any sale, lease, transfer or other disposition (other than in the
ordinary course of business consistent with past practice), in one or more
related transactions, of the assets of the Company or any Subsidiary, the book
value of which assets exceeds 5% of the consolidated assets of the Company and
its Subsidiaries.
4. Any merger, consolidation, liquidation or dissolution of the
Company or any Subsidiary of the Company, other than any such merger or
consolidation of any Subsidiary of the Company with and into the Company or
another wholly-owned Subsidiary of the Company.
5. Any acquisition of any other business which would constitute a
"Significant Subsidiary" (as defined in Section 1.02 of Regulation S-X under the
Exchange Act) of the Company.
6. Any acquisition by the Company or any Subsidiary of the Company of
assets (not in the ordinary course of business consistent with past practice) in
one or more related
transactions which assets have a value which exceeds 5% of the consolidated
assets of the Company and its Subsidiaries.
7. Any issuance or sale of any capital stock of the Company or any
Subsidiary of the Company, other than issuance of capital stock of the Company
authorized for issuance pursuant to stock plans or agreements in effect, or
securities issued and outstanding, at the date of Closing.
8. Any declaration or payment of any dividend or distribution with
respect to shares of the capital stock of the Company or any Subsidiary (other
than wholly-owned Subsidiaries of the Company).
9. Any incurrence, assumption or issuance by the Company or its
Subsidiaries of any indebtedness for money borrowed, not in the ordinary course
of business consistent with past practice, if, immediately after giving effect
thereto and the application of proceeds therefrom, the aggregate amount of such
indebtedness of the Company and its Subsidiaries would exceed $500 million.
10. Establishment of, or continued existence of, any committee of the
Board of Directors with the power to approve any of the foregoing.
11. The termination or election or appointment of executive officers
of the Company.
Dates Referenced Herein and Documents Incorporated by Reference
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