US Airways 2005 Annual Report Download - page 43

Table of Contents
common stock. The Company currently does not intend to do so. Under the provisions of certain debt agreements, including our secured loans, our ability to
pay dividends on or repurchase our common stock is restricted. Any future determination to pay cash dividends will be at the discretion of our board of
directors, subject to applicable limitations under Delaware law, and will depend upon our results of operations, financial condition, contractual restrictions and
other factors deemed relevant by our board of directors. See "Liquidity and Capital Resources" in Item 7, "Management's Discussion and Analysis of
Financial Condition and Results of Operation," below for more information, including information related to dividend restrictions associated with our secured
loans.
Foreign Ownership Restrictions
Under current federal law, non-U.S. citizens cannot own or control more than 25% of the outstanding voting securities of a domestic air carrier. We
believe that we were in compliance with this statute during the time period covered by this report.
Recent Sales of Unregistered Securities
Completion of the merger between US Airways Group and America West Holdings on September 27, 2005 constituted a "change of control" under
AWA's Senior Exchangeable Notes due 2023 and required AWA to make an offer to holders to purchase those notes within 30 business days after the
effective time of the merger at a purchase price of $343.61 per $1,000 principal amount at maturity. Under the terms of the notes and the related Guarantee
and Exchange Agreement, dated as of July 30, 2003, between America West Holdings and U.S. Bank National Association, as Trustee, as supplemented by
the Guarantee and Exchange Agreement Supplement No. 1 among America West Holdings, US Airways Group and the Trustee, dated as of September 27,
2005, AWA's obligation to purchase the notes was satisfied at US Airways Group's election by delivery of shares of US Airways Group common stock having
a "fair market value" of not less than $343.61 per $1,000 principal amount at maturity. For this purpose, "fair market value" means 95% of the market price of
US Airways Group common stock calculated as the average closing prices over the five business days ending on and including the third business day before
the purchase date.
On October 24, 2005, US Airways Group issued a total of 4,156,411 shares of its common stock in exchange for approximately $250 million in principal
amount at maturity of AWA's Senior Exchangeable Notes due 2023, which notes were fully and unconditionally guaranteed by US Airways Group. The
shares were exchanged at a rate of 16.6 shares of US Airways Group common stock per $1,000 principal amount at maturity, in full satisfaction of the
purchase price of the notes. The amount of notes exchanged represented approximately 99% of the outstanding principal amount, and approximately
$2 million in principal amount at maturity of the notes remained outstanding after the exchange. On November 30, 2005, US Airways Group issued a total of
38,864 shares of its common stock to repurchase the remaining outstanding principal amount of the notes.
The issuance of US Airways Group common stock to the holders of the notes was made pursuant to the exemption from registration under Section 3(a)(9)
of the Securities Act of 1933, as amended. 37