US Airways 2007 Annual Report Download - page 56

Table of Contents
aircraft maintenance expense and fuel costs. The increase in cash outflows was partially offset by an increase in cash receipts due to the
better revenue environment in 2007 compared to 2006.
Net cash provided by investing activities in 2007 was $306 million compared to net cash used in investing activities of $893 million
in 2006. Principal investing activities in 2007 included purchases of property and equipment that totaled $486 million, including the
purchase of nine Embraer 190 aircraft, an $80 million increase in equipment purchase deposits, a decrease in restricted cash of
$200 million, and $56 million in proceeds from the sale of investments in ARINC and Sabre. US Airways also had net proceeds from
sales of investments in marketable securities of $612 million, principally the result of sales of auction rate securities that were still liquid
at par value in the third quarter of 2007. The 2006 period included purchases of property and equipment totaling $222 million, including
the purchase of three Boeing 757-200 and two Embraer 190 aircraft, net purchases of investments in marketable securities of
$798 million and a decrease in restricted cash of $128 million. Changes in the restricted cash balances for the 2007 and 2006 periods are
due to changes in reserves required under agreements for processing credit card transactions.
Net cash provided by financing activities was $93 million and $239 million in 2007 and 2006, respectively. Principal financing
activities in 2007 included the issuance of $198 million of new debt to finance the acquisition of nine Embraer 190 aircraft and total debt
repayments of $105 million. The 2006 period included a net increase in payables to related parties of $247 million, the issuance of
$92 million of new debt to finance the acquisition of three Boeing 757-200 aircraft and two Embraer 190 aircraft and total debt
repayments of $100 million.
Commitments
As of December 31, 2007, we had $3.27 billion of long-term debt and capital leases (including current maturities and net of
discount on debt), which consisted primarily of the items discussed below.
Refinancing Transactions
On March 23, 2007, we entered into a new term loan credit facility with Citicorp North America, Inc., as administrative agent, and a
syndicate of lenders, pursuant to which US Airways Group borrowed an aggregate principal amount of $1.6 billion. US Airways, AWA
and certain other subsidiaries of US Airways Group are guarantors of the Citicorp credit facility.
The proceeds of the Citicorp credit facility were used to repay in full the following indebtedness:
• The amended and restated loan agreement, dated April 7, 2006, entered into by US Airways Group with GECC and a syndicate
of lenders. At the time of the repayment, the total outstanding balance of the loan was $1.25 billion.
• The Barclays prepaid miles issued on October 3, 2005 in connection with the amended co-branded credit card agreement dated
August 8, 2005 between pre-merger US Airways Group, AWA and Juniper Bank, a subsidiary of Barclays PLC that has since
been renamed Barclays Bank Delaware ("Barclays"). At the time of the repayment, the total outstanding balance was
$325 million.
• The credit facility with GECC, amended in July 2005 with an original balance of $28 million. At the time of the repayment, the
total outstanding balance of the loan was $19 million.
The Citicorp credit facility bears interest at an index rate plus an applicable index margin or, at our option, LIBOR plus an
applicable LIBOR margin for interest periods of one, two, three or six months. The applicable index margin, subject to adjustment, is
1.00%, 1.25% or 1.50% if the adjusted loan balance is less than $600 million, between $600 million and $1 billion, or between $1 billion
and $1.6 billion, respectively. The applicable LIBOR margin, subject to adjustment, is 2.00%, 2.25% or 2.50% if the adjusted loan
balance is less than $600 million, between $600 million and $1 billion, or between $1 billion and $1.6 billion, respectively. In addition,
interest on the Citicorp credit facility may be adjusted based on the credit rating for the Citicorp credit facility as follows: (i) if the credit
ratings of the Citicorp credit facility by Moody's and S&P in effect as of the last day of the most recently ended fiscal quarter are both at
least one subgrade better than the credit ratings in effect on March 23, 2007, then (A) the applicable LIBOR margin will be the lower of
2.25% and the rate otherwise applicable based upon the
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