United Airlines 2009 Annual Report Download - page 136

Table of Contents
• The third quarter included $24 million of lease termination and other special charges, $22 million of severance charges, $19 million of aircraft
impairment charges to reduce the carrying value of five nonoperating B747 aircraft to their net realizable value and $6 million of accelerated
depreciation related to aircraft groundings. These items were offset by an $11 million gain on asset sales.
• During the fourth quarter, the Company recorded an additional $74 million of aircraft impairment charges, $50 million of lease termination and
other special charges, $10 million of severance charges and $10 million accelerated depreciation related to aircraft groundings.
2008
• The second quarter was negatively impacted by impairment charges of $2.5 billion related to the Company’s interim impairment testing of its
intangible assets. In addition, the Company incurred $110 million of severance and employee benefit charges, as well as $26 million of purchased
services charges. Offsetting these impacts was a $29 million gain from a litigation-related settlement gain.
• The third quarter included reversals of $16 million of intangible asset impairments recorded during the second quarter. The Company also recorded
an additional $6 million of severance charges, as well as $8 million of losses on the sale of assets and $7 million of lease termination and other
charges.
• During the fourth quarter, the Company recorded $107 million of impairment charges, $18 million of severance, $53 million of employee benefit
charges, $34 million of accelerated depreciation related to aircraft groundings and $18 million of lease termination and other special charges. In
addition, an $11 million net gain on asset sales partially offset these unfavorable expenses.
See Note 2, “Company Operational Plans” and Note 3, “Asset Impairments and Intangible Assets,” for further discussion of these items.
(21) Subsequent Events
The Company has evaluated its subsequent events for disclosure and has identified the following events.
In January 2010, United issued the remaining $612 million of equipment notes relating to the Series 2009-1 EETCs of which $568 million was used to
complete the pre-payment of the remaining principal of the equipment notes issued in connection with the Series 2001-1 EETCs and the remaining $44 million,
before expenses and accrued interest due on the equipment notes related to the Series 2001-1 EETCs, provided the Company with incremental liquidity. The
Company also received $21 million of proceeds from the distribution of the Series 2001-1 EETC trust assets upon repayment of the note obligations.
In January 2010, United also issued the remaining $696 million of equipment notes relating to the Series 2009-2 EETCs of which $493 million was used to
pre-pay the remaining principal of the equipment notes issued in connection with the Series 2000-2 EETCs and the remaining proceeds of $203 million, before
expenses and accrued interest due on equipment notes related to the Series 2000-2 EETCs, provided the Company with incremental liquidity.
In January 2010, United issued $700 million aggregate principal amount of Senior Secured Notes and Senior Second Lien Notes. The Company expects to
receive proceeds from the issuance in April 2010, upon release of the collateral from the Amended Credit Facility.
The EETC repayments, discussed above, significantly reduced the future near term debt requirements. See Note 11, “Debt Obligations and Card
Processing Agreements,” for additional information related to these financings including the Company’s future debt maturities after giving effect to these
transactions.
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