US Airways 2011 Annual Report Download - page 68

Table of Contents
Commitments
As of December 31, 2011, we had $4.73 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 (the "Citicorp 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
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 greater than $1 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 greater than $1 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, 2011, the interest rate on the Citicorp credit
facility was 2.80% 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 specified 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. The Citicorp credit facility requires us to maintain consolidated unrestricted cash and cash equivalents of
not less than $850 million, with not less than $750 million (subject to partial reductions upon certain reductions in the outstanding principal amount of the
loan) of that amount held in accounts subject to control agreements, which would become restricted for use by us if certain adverse events occur per the terms
of the agreement. In addition, the Citicorp credit facility provides that we may issue debt in the future with a second lien on the assets pledged as collateral
under the Citicorp credit facility. The principal amount outstanding under the Citicorp credit facility was $1.14 billion as of December 31, 2011. As of
December 31, 2011, we were in compliance with all debt covenants under the Citicorp credit facility.
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