Continental Airlines has reached a new seven-year capacity purchase agreement with ExpressJet Airlines, Inc. to provide regional jet
service for Continental Airlines at rates that are lower than rates under its current agreement. The new agreement is effective July 1, 2008.
The new contract enables Continental to continue to benefit from the excellent service and substantial feed traffic provided by ExpressJet.
The base agreement covers flying by ExpressJet of a minimum of 205 regional jets in the first year and a minimum of 190 regional jets
In addition, ExpressJet has the right to return to Continental 39 Embraer 50-seat regional jets that ExpressJet currently uses for
non-Continental contract flying. Continental plans to add the returned aircraft to the new agreement and withdraw from the agreement up to
30 of its Embraer 37-seat regional jets currently flown by ExpressJet for Continental. Continental will then sublease or ground all of the
withdrawn Embraer 37-seat regional jets to better align regional capacity with current market conditions. Additionally, the agreement
reduces the rent Continental charges ExpressJet on 30 other regional jets that ExpressJet will retain for seven years
to fly at its own revenue risk.
Continental and ExpressJet also entered into a settlement agreement and release of all the
partiesí claims relating to payments and rates under the original capacity purchase agreement, including all disputes previously disclosed as possible matters for arbitration.
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