NOTE 15—LEASES AND CAPACITY PURCHASE AGREEMENTS

The Company leases aircraft, airport passenger terminal space, aircraft hangars and related maintenance facilities, cargo terminals, other airport facilities, other commercial real estate, office and computer equipment and vehicles.

At December 31, 2011, the Company's scheduled future minimum lease payments under operating leases having initial or remaining noncancelable lease terms of more than one year, aircraft leases, including aircraft rent under capacity purchase agreements and capital leases (substantially all of which are for aircraft) were as follows (in millions):


	Operating Leases
	UAL (b), (c)			United			Continental (c)
Aircraft Operating Leases
2012	$	1,688		$	705		$	1,000
2013		1,597			647			959
2014		1,518			595			930
2015		1,243			417			828
2016		984			246			738
After 2016		2,391			392			1,999

	$	9,421		$	3,002		$	6,454

Facility and Other Operating Leases
2012	$	1,222		$	699		$	523
2013		998			624			374
2014		919			561			358
2015		795			462			333
2016		723			420			303
After 2016		5,738			2,174			3,564

	$	10,395		$	4,940		$	5,455

Capital Leases (a)
2012	$	228		$	206		$	22
2013		221			197			24
2014		207			183			24
2015		187			164			23
2016		173			150			23
After 2016		836			332			504

Minimum lease payments	$	1,852		$	1,232		$	620

Imputed interest		(799	)		(375	)		(424	)

Present value of minimum lease payments		1,053			857			196
Current portion		(125	)		(122	)		(3	)

Long-term obligations under capital leases	$	928		$	735		$	193

(a)

As of December 31, 2011, United's aircraft capital lease minimum payments relate to leases of 49 mainline and 38 regional aircraft and Continental's aircraft capital lease minimum payments relate to nonaircraft assets. United's and Continental's imputed interest rate ranges are 3.2% to 20.0% and 5.0% to 8.4%, respectively.

(b)

The operating lease payments presented above include United's and Continental's future payments of $13 million and $165 million, respectively, related to nonoperating aircraft as of December 31, 2011. United and Continental have 12 and 25 nonoperating aircraft subject to leases, respectively. United's regional carrier, Express Jet, subleases aircraft from Continental; UAL operating lease payments exclude payments related to these aircraft.

(c)

For UAL and Continental, the table above does not include projected sublease income of $106 million to be received through 2016 from other operators related to aircraft that are not operated on Continental's behalf. Continental expects such sublease income to be $25 million, $20 million, $20 million, $20 million and $21 million in each of the next five years, respectively.

Aircraft operating leases have initial terms of one to twenty-six years, with expiration dates ranging from 2012 through 2025. Under the terms of most leases, the Company has the right to purchase the aircraft at the end of the lease term, in some cases at fair market value, and in others, at fair market value or a percentage of cost. The Company has facility operating leases that extend to 2032.

United and Continental are the lessees of real property under long-term operating leases at a number of airports where we are also the guarantor of approximately $270 million and $1.4 billion, respectively, of underlying debt and interest thereon. These leases are typically with municipalities or other governmental entities, which are excluded from the consolidation requirements concerning VIEs. To the extent the Company's leases and related guarantees are with a separate legal entity other than a governmental entity, the Company is not the primary beneficiary because the lease terms are consistent with market terms at the inception of the lease and the lease does not include a residual value guarantee, fixed-price purchase option, or similar feature as discussed in Note 16.

In October 2009, United amended a capacity agreement with one of its regional carriers. The amendment extended the lease terms on 40 existing aircraft and added 14 new aircraft to the amended agreement. As a result of this amendment, capital lease assets and obligations increased by $250 million.

In January 2009, United amended its lease of the Chicago O'Hare International Airport cargo facility. This amendment resulted in proceeds to United of approximately $160 million in return for United's agreement to vacate its currently leased cargo facility earlier than the lease expiration date in order for the airport authority to continue with its long-term airport modernization plan. The proceeds were recorded as a deferred credit. This deferred credit, net of $18 million of carrying value of abandoned leasehold interests, will be amortized through 2022.

The table below summarizes the Company's nonaircraft rent expense, net of minor amounts of sublease rentals, for the years ended December 31, (in millions):


	UAL		United		Continental Successor		Continental Predecessor
2011	$	1,265	$	666	$	599
2010		839		685		154	$	452
2009		644		644				578

In addition to nonaircraft rent in the table above and aircraft rent, which is separately presented in the consolidated statements of operations, UAL had aircraft rent related to regional aircraft operating leases, which is included as part of regional capacity purchase expense in UAL's consolidated statement of operations, of $498 million, $411 million and $443 million for the years ended December 31, 2011, 2010 and 2009, respectively. For the year ended December 31, 2011, UAL's regional aircraft rent, which is included as part of regional capacity purchase expense, consisted of $395 million and $103 million related to United and Continental, respectively.

In connection with UAL Corporation's and United's fresh-start reporting requirements upon their exit from Chapter 11 bankruptcy protection in 2006 and UAL's and Continental's acquisition accounting adjustments related to the Merger, lease valuation adjustments for operating leases were initially recorded in the consolidated balance sheet, representing the net present value of the differences between contractual lease rates and the fair market lease rates for similar leased assets at the time. An asset (liability) results when the contractual lease rates are more (less) favorable than market lease terms at the valuation date. The lease valuation adjustment is amortized on a straight-line basis as an increase (decrease) to rent expense over the individual applicable remaining lease terms, resulting in recognition of rent expense as if the Company had entered into the leases at market rates. The related remaining lease terms are one to 13 years for United and one to 14 years for Continental. The lease valuation adjustments are classified within other noncurrent assets and other noncurrent liabilities, respectively, and are as follows as of December 31, (in millions):


	UAL			United			Continental
Gross deferred asset	$	263		$	263		$	—
Less: accumulated amortization		(155	)		(155	)		—

Net deferred asset balance at December 31, 2010		108			108			—
Less: accumulated amortization		(14	)		(14	)		—

Net deferred asset balance at December 31, 2011	$	94		$	94		$	—


Gross deferred liability	$	(1,433	)	$	—		$	(1,433	)
Less: accumulated amortization		59			—			59

Net deferred liability at December 31, 2010		(1,374	)		—			(1,374	)
Less: accumulated amortization		241			—			241

Net deferred liability at December 31, 2011	$	(1,133	)	$	—		$	(1,133	)

Regional Capacity Purchase Agreements

The Company has capacity purchase agreements ("CPAs") with certain regional carriers. We purchase all of the capacity from the flights covered by the CPA at a negotiated price. In exchange for the regional carriers' operation of the flights and performance of other obligations under the CPAs, we have agreed to pay the regional carrier a pre-determined rate, subject to annual inflation adjustments (capped at 3%), for each block hour flown (the hours from gate departure to gate arrival) and to reimburse the regional carrier for various pass-through expenses (with no margin or mark-up) related to the flights, including aviation insurance, property taxes, international navigation fees, depreciation (primarily aircraft-related), landing fees and certain maintenance expenses. Under the CPAs, we are responsible for the cost of providing fuel for all flights and for paying aircraft rent for all of the aircraft covered by the CPAs. Generally, the CPAs contain incentive bonus and rebate provisions based upon each regional carrier's operational performance. United's and Continental's CPAs are for 291 and 265 regional aircraft, respectively, and the United and Continental CPAs have terms expiring through 2024 and 2021, respectively. Aircraft operated under CPAs include aircraft leased directly from the regional carriers and those leased from third party lessors and operated by the regional carriers.

Our future commitments under our CPAs are dependent on numerous variables, and are therefore difficult to predict. The most important of these variables is the number of scheduled block hours. Although we are not required to purchase a minimum number of block hours under certain of our CPAs, we have set forth below estimates of our future payments under the CPAs based on our assumptions. Continental's estimates of its future payments under all of the CPAs do not include the portion of the underlying obligation for any aircraft leased to ExpressJet or deemed to be leased from other regional carriers and facility rent that are disclosed as part of aircraft and nonaircraft operating leases. For purposes of calculating these estimates, we have assumed (1) the number of block hours flown is based on our anticipated level of flight activity or at any contractual minimum utilization levels if applicable, (2) that we will reduce the fleet as rapidly as contractually allowed under each CPA, (3) that aircraft utilization, stage length and load factors will remain constant, (4) that each carrier's operational performance will remain at historic levels and (5) that inflation is projected to be between 1.3% and 3.0% per year. Based on these assumptions as of December 31, 2011, our future payments through the end of the terms of our CPAs are presented in the table below (in millions). These amounts exclude variable pass-through costs such as fuel and landing fees, among others.


	UAL		United		Continental
2012	$	1,653	$	912	$	741
2013		1,568		855		713
2014		1,403		733		670
2015		1,261		645		616
2016		1,022		418		604
After 2016		2,855		1,127		1,728

	$	9,762	$	4,690	$	5,072

It is important to note that the actual amounts we pay to our regional operators under CPAs could differ materially from these estimates. For example, a 10% increase or decrease in scheduled block hours for all of United's and Continental's regional operators (whether as a result of changes in average daily utilization or otherwise) in 2012 would result in a corresponding change in cash obligations under the CPAs of approximately $78 million (8.6%) and $72 million (9.7%), respectively.

Leases And Capacity Purchase Agreements

NOTE 15—LEASES AND CAPACITY PURCHASE AGREEMENTS

The Company leases aircraft, airport passenger terminal space, aircraft hangars and related maintenance facilities, cargo terminals, other airport facilities, other commercial real estate, office and computer equipment and vehicles.

At December 31, 2011, the Company's scheduled future minimum lease payments under operating leases having initial or remaining noncancelable lease terms of more than one year, aircraft leases, including aircraft rent under capacity purchase agreements and capital leases (substantially all of which are for aircraft) were as follows (in millions):


	Operating Leases
	UAL (b), (c)			United			Continental (c)
Aircraft Operating Leases
2012	$	1,688		$	705		$	1,000
2013		1,597			647			959
2014		1,518			595			930
2015		1,243			417			828
2016		984			246			738
After 2016		2,391			392			1,999

	$	9,421		$	3,002		$	6,454

Facility and Other Operating Leases
2012	$	1,222		$	699		$	523
2013		998			624			374
2014		919			561			358
2015		795			462			333
2016		723			420			303
After 2016		5,738			2,174			3,564

	$	10,395		$	4,940		$	5,455

Capital Leases (a)
2012	$	228		$	206		$	22
2013		221			197			24
2014		207			183			24
2015		187			164			23
2016		173			150			23
After 2016		836			332			504

Minimum lease payments	$	1,852		$	1,232		$	620

Imputed interest		(799	)		(375	)		(424	)

Present value of minimum lease payments		1,053			857			196
Current portion		(125	)		(122	)		(3	)

Long-term obligations under capital leases	$	928		$	735		$	193

(a)

As of December 31, 2011, United's aircraft capital lease minimum payments relate to leases of 49 mainline and 38 regional aircraft and Continental's aircraft capital lease minimum payments relate to nonaircraft assets. United's and Continental's imputed interest rate ranges are 3.2% to 20.0% and 5.0% to 8.4%, respectively.

(b)

The operating lease payments presented above include United's and Continental's future payments of $13 million and $165 million, respectively, related to nonoperating aircraft as of December 31, 2011. United and Continental have 12 and 25 nonoperating aircraft subject to leases, respectively. United's regional carrier, Express Jet, subleases aircraft from Continental; UAL operating lease payments exclude payments related to these aircraft.

(c)

For UAL and Continental, the table above does not include projected sublease income of $106 million to be received through 2016 from other operators related to aircraft that are not operated on Continental's behalf. Continental expects such sublease income to be $25 million, $20 million, $20 million, $20 million and $21 million in each of the next five years, respectively.

Aircraft operating leases have initial terms of one to twenty-six years, with expiration dates ranging from 2012 through 2025. Under the terms of most leases, the Company has the right to purchase the aircraft at the end of the lease term, in some cases at fair market value, and in others, at fair market value or a percentage of cost. The Company has facility operating leases that extend to 2032.

United and Continental are the lessees of real property under long-term operating leases at a number of airports where we are also the guarantor of approximately $270 million and $1.4 billion, respectively, of underlying debt and interest thereon. These leases are typically with municipalities or other governmental entities, which are excluded from the consolidation requirements concerning VIEs. To the extent the Company's leases and related guarantees are with a separate legal entity other than a governmental entity, the Company is not the primary beneficiary because the lease terms are consistent with market terms at the inception of the lease and the lease does not include a residual value guarantee, fixed-price purchase option, or similar feature as discussed in Note 16.

In October 2009, United amended a capacity agreement with one of its regional carriers. The amendment extended the lease terms on 40 existing aircraft and added 14 new aircraft to the amended agreement. As a result of this amendment, capital lease assets and obligations increased by $250 million.

In January 2009, United amended its lease of the Chicago O'Hare International Airport cargo facility. This amendment resulted in proceeds to United of approximately $160 million in return for United's agreement to vacate its currently leased cargo facility earlier than the lease expiration date in order for the airport authority to continue with its long-term airport modernization plan. The proceeds were recorded as a deferred credit. This deferred credit, net of $18 million of carrying value of abandoned leasehold interests, will be amortized through 2022.

The table below summarizes the Company's nonaircraft rent expense, net of minor amounts of sublease rentals, for the years ended December 31, (in millions):


	UAL		United		Continental Successor		Continental Predecessor
2011	$	1,265	$	666	$	599
2010		839		685		154	$	452
2009		644		644				578

In addition to nonaircraft rent in the table above and aircraft rent, which is separately presented in the consolidated statements of operations, UAL had aircraft rent related to regional aircraft operating leases, which is included as part of regional capacity purchase expense in UAL's consolidated statement of operations, of $498 million, $411 million and $443 million for the years ended December 31, 2011, 2010 and 2009, respectively. For the year ended December 31, 2011, UAL's regional aircraft rent, which is included as part of regional capacity purchase expense, consisted of $395 million and $103 million related to United and Continental, respectively.

In connection with UAL Corporation's and United's fresh-start reporting requirements upon their exit from Chapter 11 bankruptcy protection in 2006 and UAL's and Continental's acquisition accounting adjustments related to the Merger, lease valuation adjustments for operating leases were initially recorded in the consolidated balance sheet, representing the net present value of the differences between contractual lease rates and the fair market lease rates for similar leased assets at the time. An asset (liability) results when the contractual lease rates are more (less) favorable than market lease terms at the valuation date. The lease valuation adjustment is amortized on a straight-line basis as an increase (decrease) to rent expense over the individual applicable remaining lease terms, resulting in recognition of rent expense as if the Company had entered into the leases at market rates. The related remaining lease terms are one to 13 years for United and one to 14 years for Continental. The lease valuation adjustments are classified within other noncurrent assets and other noncurrent liabilities, respectively, and are as follows as of December 31, (in millions):


	UAL			United			Continental
Gross deferred asset	$	263		$	263		$	—
Less: accumulated amortization		(155	)		(155	)		—

Net deferred asset balance at December 31, 2010		108			108			—
Less: accumulated amortization		(14	)		(14	)		—

Net deferred asset balance at December 31, 2011	$	94		$	94		$	—


Gross deferred liability	$	(1,433	)	$	—		$	(1,433	)
Less: accumulated amortization		59			—			59

Net deferred liability at December 31, 2010		(1,374	)		—			(1,374	)
Less: accumulated amortization		241			—			241

Net deferred liability at December 31, 2011	$	(1,133	)	$	—		$	(1,133	)

Regional Capacity Purchase Agreements

The Company has capacity purchase agreements ("CPAs") with certain regional carriers. We purchase all of the capacity from the flights covered by the CPA at a negotiated price. In exchange for the regional carriers' operation of the flights and performance of other obligations under the CPAs, we have agreed to pay the regional carrier a pre-determined rate, subject to annual inflation adjustments (capped at 3%), for each block hour flown (the hours from gate departure to gate arrival) and to reimburse the regional carrier for various pass-through expenses (with no margin or mark-up) related to the flights, including aviation insurance, property taxes, international navigation fees, depreciation (primarily aircraft-related), landing fees and certain maintenance expenses. Under the CPAs, we are responsible for the cost of providing fuel for all flights and for paying aircraft rent for all of the aircraft covered by the CPAs. Generally, the CPAs contain incentive bonus and rebate provisions based upon each regional carrier's operational performance. United's and Continental's CPAs are for 291 and 265 regional aircraft, respectively, and the United and Continental CPAs have terms expiring through 2024 and 2021, respectively. Aircraft operated under CPAs include aircraft leased directly from the regional carriers and those leased from third party lessors and operated by the regional carriers.

Our future commitments under our CPAs are dependent on numerous variables, and are therefore difficult to predict. The most important of these variables is the number of scheduled block hours. Although we are not required to purchase a minimum number of block hours under certain of our CPAs, we have set forth below estimates of our future payments under the CPAs based on our assumptions. Continental's estimates of its future payments under all of the CPAs do not include the portion of the underlying obligation for any aircraft leased to ExpressJet or deemed to be leased from other regional carriers and facility rent that are disclosed as part of aircraft and nonaircraft operating leases. For purposes of calculating these estimates, we have assumed (1) the number of block hours flown is based on our anticipated level of flight activity or at any contractual minimum utilization levels if applicable, (2) that we will reduce the fleet as rapidly as contractually allowed under each CPA, (3) that aircraft utilization, stage length and load factors will remain constant, (4) that each carrier's operational performance will remain at historic levels and (5) that inflation is projected to be between 1.3% and 3.0% per year. Based on these assumptions as of December 31, 2011, our future payments through the end of the terms of our CPAs are presented in the table below (in millions). These amounts exclude variable pass-through costs such as fuel and landing fees, among others.


	UAL		United		Continental
2012	$	1,653	$	912	$	741
2013		1,568		855		713
2014		1,403		733		670
2015		1,261		645		616
2016		1,022		418		604
After 2016		2,855		1,127		1,728

	$	9,762	$	4,690	$	5,072

It is important to note that the actual amounts we pay to our regional operators under CPAs could differ materially from these estimates. For example, a 10% increase or decrease in scheduled block hours for all of United's and Continental's regional operators (whether as a result of changes in average daily utilization or otherwise) in 2012 would result in a corresponding change in cash obligations under the CPAs of approximately $78 million (8.6%) and $72 million (9.7%), respectively.

Leases And Capacity Purchase Agreements

NOTE 15—LEASES AND CAPACITY PURCHASE AGREEMENTS

The Company leases aircraft, airport passenger terminal space, aircraft hangars and related maintenance facilities, cargo terminals, other airport facilities, other commercial real estate, office and computer equipment and vehicles.

At December 31, 2011, the Company's scheduled future minimum lease payments under operating leases having initial or remaining noncancelable lease terms of more than one year, aircraft leases, including aircraft rent under capacity purchase agreements and capital leases (substantially all of which are for aircraft) were as follows (in millions):


	Operating Leases
	UAL (b), (c)			United			Continental (c)
Aircraft Operating Leases
2012	$	1,688		$	705		$	1,000
2013		1,597			647			959
2014		1,518			595			930
2015		1,243			417			828
2016		984			246			738
After 2016		2,391			392			1,999

	$	9,421		$	3,002		$	6,454

Facility and Other Operating Leases
2012	$	1,222		$	699		$	523
2013		998			624			374
2014		919			561			358
2015		795			462			333
2016		723			420			303
After 2016		5,738			2,174			3,564

	$	10,395		$	4,940		$	5,455

Capital Leases (a)
2012	$	228		$	206		$	22
2013		221			197			24
2014		207			183			24
2015		187			164			23
2016		173			150			23
After 2016		836			332			504

Minimum lease payments	$	1,852		$	1,232		$	620

Imputed interest		(799	)		(375	)		(424	)

Present value of minimum lease payments		1,053			857			196
Current portion		(125	)		(122	)		(3	)

Long-term obligations under capital leases	$	928		$	735		$	193

(a)

As of December 31, 2011, United's aircraft capital lease minimum payments relate to leases of 49 mainline and 38 regional aircraft and Continental's aircraft capital lease minimum payments relate to nonaircraft assets. United's and Continental's imputed interest rate ranges are 3.2% to 20.0% and 5.0% to 8.4%, respectively.

(b)

The operating lease payments presented above include United's and Continental's future payments of $13 million and $165 million, respectively, related to nonoperating aircraft as of December 31, 2011. United and Continental have 12 and 25 nonoperating aircraft subject to leases, respectively. United's regional carrier, Express Jet, subleases aircraft from Continental; UAL operating lease payments exclude payments related to these aircraft.

(c)

For UAL and Continental, the table above does not include projected sublease income of $106 million to be received through 2016 from other operators related to aircraft that are not operated on Continental's behalf. Continental expects such sublease income to be $25 million, $20 million, $20 million, $20 million and $21 million in each of the next five years, respectively.

Aircraft operating leases have initial terms of one to twenty-six years, with expiration dates ranging from 2012 through 2025. Under the terms of most leases, the Company has the right to purchase the aircraft at the end of the lease term, in some cases at fair market value, and in others, at fair market value or a percentage of cost. The Company has facility operating leases that extend to 2032.

United and Continental are the lessees of real property under long-term operating leases at a number of airports where we are also the guarantor of approximately $270 million and $1.4 billion, respectively, of underlying debt and interest thereon. These leases are typically with municipalities or other governmental entities, which are excluded from the consolidation requirements concerning VIEs. To the extent the Company's leases and related guarantees are with a separate legal entity other than a governmental entity, the Company is not the primary beneficiary because the lease terms are consistent with market terms at the inception of the lease and the lease does not include a residual value guarantee, fixed-price purchase option, or similar feature as discussed in Note 16.

In October 2009, United amended a capacity agreement with one of its regional carriers. The amendment extended the lease terms on 40 existing aircraft and added 14 new aircraft to the amended agreement. As a result of this amendment, capital lease assets and obligations increased by $250 million.

In January 2009, United amended its lease of the Chicago O'Hare International Airport cargo facility. This amendment resulted in proceeds to United of approximately $160 million in return for United's agreement to vacate its currently leased cargo facility earlier than the lease expiration date in order for the airport authority to continue with its long-term airport modernization plan. The proceeds were recorded as a deferred credit. This deferred credit, net of $18 million of carrying value of abandoned leasehold interests, will be amortized through 2022.

The table below summarizes the Company's nonaircraft rent expense, net of minor amounts of sublease rentals, for the years ended December 31, (in millions):


	UAL		United		Continental Successor		Continental Predecessor
2011	$	1,265	$	666	$	599
2010		839		685		154	$	452
2009		644		644				578

In addition to nonaircraft rent in the table above and aircraft rent, which is separately presented in the consolidated statements of operations, UAL had aircraft rent related to regional aircraft operating leases, which is included as part of regional capacity purchase expense in UAL's consolidated statement of operations, of $498 million, $411 million and $443 million for the years ended December 31, 2011, 2010 and 2009, respectively. For the year ended December 31, 2011, UAL's regional aircraft rent, which is included as part of regional capacity purchase expense, consisted of $395 million and $103 million related to United and Continental, respectively.

In connection with UAL Corporation's and United's fresh-start reporting requirements upon their exit from Chapter 11 bankruptcy protection in 2006 and UAL's and Continental's acquisition accounting adjustments related to the Merger, lease valuation adjustments for operating leases were initially recorded in the consolidated balance sheet, representing the net present value of the differences between contractual lease rates and the fair market lease rates for similar leased assets at the time. An asset (liability) results when the contractual lease rates are more (less) favorable than market lease terms at the valuation date. The lease valuation adjustment is amortized on a straight-line basis as an increase (decrease) to rent expense over the individual applicable remaining lease terms, resulting in recognition of rent expense as if the Company had entered into the leases at market rates. The related remaining lease terms are one to 13 years for United and one to 14 years for Continental. The lease valuation adjustments are classified within other noncurrent assets and other noncurrent liabilities, respectively, and are as follows as of December 31, (in millions):


	UAL			United			Continental
Gross deferred asset	$	263		$	263		$	—
Less: accumulated amortization		(155	)		(155	)		—

Net deferred asset balance at December 31, 2010		108			108			—
Less: accumulated amortization		(14	)		(14	)		—

Net deferred asset balance at December 31, 2011	$	94		$	94		$	—


Gross deferred liability	$	(1,433	)	$	—		$	(1,433	)
Less: accumulated amortization		59			—			59

Net deferred liability at December 31, 2010		(1,374	)		—			(1,374	)
Less: accumulated amortization		241			—			241

Net deferred liability at December 31, 2011	$	(1,133	)	$	—		$	(1,133	)

Regional Capacity Purchase Agreements

The Company has capacity purchase agreements ("CPAs") with certain regional carriers. We purchase all of the capacity from the flights covered by the CPA at a negotiated price. In exchange for the regional carriers' operation of the flights and performance of other obligations under the CPAs, we have agreed to pay the regional carrier a pre-determined rate, subject to annual inflation adjustments (capped at 3%), for each block hour flown (the hours from gate departure to gate arrival) and to reimburse the regional carrier for various pass-through expenses (with no margin or mark-up) related to the flights, including aviation insurance, property taxes, international navigation fees, depreciation (primarily aircraft-related), landing fees and certain maintenance expenses. Under the CPAs, we are responsible for the cost of providing fuel for all flights and for paying aircraft rent for all of the aircraft covered by the CPAs. Generally, the CPAs contain incentive bonus and rebate provisions based upon each regional carrier's operational performance. United's and Continental's CPAs are for 291 and 265 regional aircraft, respectively, and the United and Continental CPAs have terms expiring through 2024 and 2021, respectively. Aircraft operated under CPAs include aircraft leased directly from the regional carriers and those leased from third party lessors and operated by the regional carriers.

Our future commitments under our CPAs are dependent on numerous variables, and are therefore difficult to predict. The most important of these variables is the number of scheduled block hours. Although we are not required to purchase a minimum number of block hours under certain of our CPAs, we have set forth below estimates of our future payments under the CPAs based on our assumptions. Continental's estimates of its future payments under all of the CPAs do not include the portion of the underlying obligation for any aircraft leased to ExpressJet or deemed to be leased from other regional carriers and facility rent that are disclosed as part of aircraft and nonaircraft operating leases. For purposes of calculating these estimates, we have assumed (1) the number of block hours flown is based on our anticipated level of flight activity or at any contractual minimum utilization levels if applicable, (2) that we will reduce the fleet as rapidly as contractually allowed under each CPA, (3) that aircraft utilization, stage length and load factors will remain constant, (4) that each carrier's operational performance will remain at historic levels and (5) that inflation is projected to be between 1.3% and 3.0% per year. Based on these assumptions as of December 31, 2011, our future payments through the end of the terms of our CPAs are presented in the table below (in millions). These amounts exclude variable pass-through costs such as fuel and landing fees, among others.


	UAL		United		Continental
2012	$	1,653	$	912	$	741
2013		1,568		855		713
2014		1,403		733		670
2015		1,261		645		616
2016		1,022		418		604
After 2016		2,855		1,127		1,728

	$	9,762	$	4,690	$	5,072

It is important to note that the actual amounts we pay to our regional operators under CPAs could differ materially from these estimates. For example, a 10% increase or decrease in scheduled block hours for all of United's and Continental's regional operators (whether as a result of changes in average daily utilization or otherwise) in 2012 would result in a corresponding change in cash obligations under the CPAs of approximately $78 million (8.6%) and $72 million (9.7%), respectively.