United Airlines 2009 Annual Report Download - page 133

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Amounts charged to rent expense, net of minor amounts of sublease rentals, were $885 million, $926 million and $928 million; and $887 million,
$934 million and $936 million for UAL and United, respectively, for the years ended December 31, 2009, 2008 and 2007, respectively. Included in Regional
affiliates expense in the Financial Statements were operating rents for Regional Affiliates aircraft of $443 million, $413 million and $425 million for the years
ended December 31, 2009, 2008 and 2007, respectively.
(15) Statement of Consolidated Cash Flows—Supplemental Disclosures
Supplemental disclosures of cash flow information and non-cash investing and financing activities for both UAL and United, except as noted, are as
follows:
Year Ended December 31,
(In millions) 2009 2008 2007
Cash paid (refunded) during the period for:
Interest (net of amounts capitalized) $ 411 $ 412 $ 614
Income taxes (11) 3 10
Non-cash transactions:
Capital lease obligations incurred to acquire assets $ 183 $ 281 $ —
Capital lease assets and obligations recorded due to lease amendment 250 — —
Pension and other postretirement changes recorded in other comprehensive income (loss) 73 (11) —
Restricted cash received as collateral on derivative contracts 49 — —
Interest paid in kind on 6% Senior Notes 33 31 15
Net unrealized gain (loss) on financial instruments recorded in other comprehensive income (loss) 15 (37) 5
Accrued special distribution on UAL common stock (UAL only) — — 257
Receivable from unsettled stock sales as of December 31, 2008 — 15 —
Current operating payables reclassified to long-term debt due to supplier agreement 49 — —
In addition to the above non-cash transactions, see Note 4, “Common Stockholders’ Deficit and Preferred Securities,” Note 11, “Debt Obligations and
Card Processing Agreements” and Note 14, “Lease Obligations.”
(16) Advanced Purchase of Miles
In September 2008, the Company amended certain terms of its agreement with its co-branded credit card partner (the “Amendment”). In connection with
the Amendment, the Company sold an additional $500 million of pre-purchased miles to its co-branded credit card partner and extended the term of the
agreement to December 31, 2017. Prior to the Amendment, our Advanced purchase of miles obligation to our co-branded credit card partner was approximately
$600 million, which represented pre-purchased miles purchased by our co-branded credit card partner. As part of the Amendment, our co-branded credit card
partner cannot use certain of the pre-purchased miles for issuance to its cardholders prior to 2011; accordingly, the portion of miles that cannot be redeemed
within one year is classified as “Advanced purchase of miles” in the non-current liabilities section of the Company’s Financial Statements. The Amendment
specifies the maximum amount of the pre-purchased miles that our co-branded credit card partner can award to its cardholders each year from 2011 to 2017.
United has the right, but is not required, to repurchase the pre-purchased miles from its co-branded credit card partner during the term of the agreement.
The Amendment contains termination penalties that may require United to make certain payments and repurchase outstanding pre-purchased miles in cases such
as the Company’s insolvency, bankruptcy false representations or other material breaches.
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