August 20, 2002

Continental Policy Changes

Dear Travel Professional:

As part of our ongoing effort to better define what the customer wants and is willing to pay for in this changed industry environment, Continental Airlines is implementing the following policy:

• Effective immediately, Continental will now charge a $20 service fee for all Domestic tickets issued to paper on 005 ticket stock.
  (This fee was previously $10 and only applied to paper tickets issued directly by Continental.)
• This $20 fee will apply to all tickets issued to paper from the United States, Puerto Rico and the U.S. Virgin Islands point of sale, for travel wholly within the 50 United States, Puerto Rico and the U.S. Virgin Islands.
• This fee will not apply to Government fares, group tickets, or any itinerary that is not e-ticket eligible.
• This fee will apply to original and reissued tickets.
• When collected by a travel agency, this fee should be collected on a Miscellaneous Charge Order (MCO). For complete information on MCO's, please see the ARC Industry Agents Handbook, section 5.6. Please be sure to include the ticket number on the MCO in the "Issued in Connection With" box. Fees that are not correctly assessed will result in a $50.00 administrative debit memo.

This new fee more accurately reflects Continental's cost of processing paper tickets and encourages the transition to electronic tickets. Ultimately, the customer still has a choice of which type of ticket they prefer.

Effective immediately, additional new policies for travel agencies also include:

• Continental will now impose a $25 administrative debit memo for any U.S. taxes and fees reported incorrectly. Travel Agencies should properly report all US taxes and fees (i.e., combining AY fees with US tax amounts will result in a $25 administrative debit memo).
• Any debit memo issued which is not a "Flat Fee" or "Administrative" in nature will include a $25 service fee. This new fee represents the increasing costs of ensuring accurate booking and ticketing.

Your understanding is sincerely appreciated in light of the new economic environment in which we now live. Thank you for the business you're sending our way. We're working hard to provide your clients with the best service in the airline industry.

Sincerely,
June Bennett, Vice President, Sales
Dave Hilfman, Vice President, Multinational Sales & Revenue Programs