US Airways 2008 Annual Report Download - page 64

Table of Contents
Net cash provided by investing activities in 2007 was $306 million as compared to net cash used in investing activities of
$893 million in 2006. Principal investing activities in 2007 included net sales of investments in marketable securities of $612 million, a
decrease in restricted cash of $200 million and $56 million in proceeds from the sale of investments in ARINC and Sabre, offset in part
by expenditures for property and equipment totaling $486 million, including the purchase of nine Embraer 190 aircraft, and an increase in
equipment purchase deposits of $80 million. The net sales of investments in marketable securities in the 2007 period were primarily
certain auction rate securities sold at par value in the third quarter of 2007. Principal investing activities in 2006 included net purchases of
investments in marketable securities of $798 million, expenditures for property and equipment totaling $222 million, including the
purchase of three Boeing 757-200 and two Embraer 190 aircraft, 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 the amounts of holdback held by certain credit card
processors.
Net cash provided by financing activities was $90 million and $236 million in 2007 and 2006, respectively. Principal financing
activities in 2007 included proceeds from the issuance of debt of $198 million to finance the acquisition of property and equipment and
total debt repayments of $105 million. Principal financing activities in 2006 included a net increase in payables to related parties of
$247 million, the issuance of $92 million of equipment notes to finance the acquisition of property and equipment and total debt
repayments of $100 million.
Commitments
As of December 31, 2008, we had $4.15 billion of long-term debt and capital leases (including current maturities and before
discount on debt).
Citicorp Credit Facility
On March 23, 2007, US Airways Group entered into a 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 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 adjusted Citicorp credit facility balance and (B) the applicable index margin will
be the lower of 1.25% and the rate otherwise applicable based upon the Citicorp credit facility principal balance, and (ii) 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 two subgrades better than the credit ratings in effect on March 23, 2007, then (A) the applicable LIBOR margin will be 2.00% and
(B) the applicable index margin will be 1.00%. As of December 31, 2008, the interest rate on the Citicorp credit facility was 2.97% based
on a 2.50% LIBOR margin.
The Citicorp credit facility matures on March 23, 2014, and is repayable in seven annual installments with each of the first six
installments to be paid on each anniversary of the closing date in an amount equal to 1% of the initial aggregate principal amount of the
loan and the final installment to be paid on the maturity date in the amount of the full remaining balance of the loan.
In addition, the Citicorp credit facility requires certain mandatory prepayments upon the occurrence of certain events, establishes
certain financial covenants, including minimum cash requirements and maintenance of certain minimum ratios, contains customary
affirmative covenants and negative covenants and contains customary events of default. Prior to the amendment discussed below, the
Citicorp credit facility required us to maintain consolidated
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