United Airlines 2007 Annual Report Download - page 6

On December 9, 2002 (the "Petition Date"), UAL, United, and 26 direct and indirect wholly-owned subsidiaries (collectively, the "Debtors") filed voluntary
petitions to reorganize their businesses under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Northern District of
Illinois, Eastern Division (the "Bankruptcy Court"). On January 20, 2006, the Bankruptcy Court confirmed the Debtors' Second Amended Joint Plan of
Reorganization Pursuant to Chapter 11 of the United States Bankruptcy Code (the "Plan of Reorganization"). The Plan of Reorganization became effective and
the Debtors emerged from bankruptcy protection on February 1, 2006 (the "Effective Date"). On the Effective Date, the Company implemented fresh-start
reporting in accordance with American Institute of Certified Public Accountants' Statement of Position 90-7, Financial Reporting by Entities in Reorganization
under the Bankruptcy Code ("SOP 90-7").
The Plan of Reorganization generally provided for the full payment or reinstatement of allowed administrative claims, priority claims and secured claims,
and the distribution of new UAL equity and debt securities to the Debtors' creditors and employees in satisfaction of allowed unsecured and deemed claims. UAL
common and preferred securities outstanding at January 31, 2006 were canceled. The Plan of Reorganization contemplated UAL issuing up to 125 million shares
of new UAL common stock consisting of 115 million shares to be issued to unsecured creditors and employees and 10 million shares to be issued pursuant to
UAL's share-based management and director compensation plans. The new UAL common stock was listed on a NASDAQ market and began trading under the
symbol "UAUA" on February 2, 2006.
Significant Matters Remaining to be Resolved in Bankruptcy Court. During the course of its Chapter 11 proceedings, the Company successfully reached
settlements with most of its creditors and resolved most pending claims against the Debtors. However, certain significant matters remain to be resolved in the
Bankruptcy Court. For details, see Note 1, "Voluntary Reorganization Under Chapter 11—Significant Matters Remaining to be Resolved in Chapter 11 Cases,"
in the Combined Notes to Consolidated Financial Statements.
Operations
Segments. The Company operates its businesses through two reporting segments: Mainline and United Express. The Company manages its business as an
integrated network with assets deployed across integrated mainline and regional carrier networks. This focus on managing the business seeks to maximize the
profitability of the overall airline network. Financial information on the Company's reporting segments and operating revenues by geographic regions, as reported
to the U.S. Department of Transportation ("DOT"), can be found in Note 10, "Segment Information," in the Combined Notes to Consolidated Financial
Statements.
Mainline. Mainline operating revenues were $17.0 billion in 2007, $16.4 billion in 2006 and $15.0 billion and $14.9 billion for UAL and United,
respectively, in 2005. As of December 31, 2007, mainline domestic operations served approximately 90 destinations primarily throughout the U.S. and Canada
and operated hubs at Chicago O'Hare International Airport ("O'Hare"), Denver International Airport, Los Angeles International Airport ("LAX"), San Francisco
International Airport ("SFO") and Washington Dulles International Airport ("Washington Dulles"). Mainline international operations serve the Pacific, Atlantic,
and Latin America regions. The Pacific region includes non-stop service to Beijing, Hong Kong, Nagoya, Osaka, Seoul, Shanghai, Sydney, Tokyo and Taipei
(with service to Guangzhou, China scheduled to commence in June 2008); direct service to Bangkok, Seoul and Singapore via Tokyo; direct service to Ho Chi
Minh City and Singapore via Hong Kong, and to Melbourne via Sydney. The Atlantic region includes non-stop service to Amsterdam, Brussels, Frankfurt,
Kuwait City, London, Munich, Paris, Rome and Zurich. The Latin American region offers non-stop service to Buenos Aires, Sao Paulo and direct service to Rio
de Janeiro. The Latin American region also serves various Mexico destinations including Cancun, Cozumel (seasonal), Mexico City, Puerto Vallarta, San Jose
del Cabo, and Ixtapa/Zihuatanejo (seasonal); various Caribbean points
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Source: UNITED AIR LINES INC, 10-K, February 29, 2008