Date: Friday, 16 September 2005 11:33am ET
To: Special_Bulletins
From: CRIGLER
Subject: Special Bulletins
To All Employees ... Please Post ... Special Bulletin
US AIRWAYS PLAN OF REORGANIZATION
RECEIVES U.S. BANKRUPTCY COURT APPROVAL
US Airways is now in the final stages of completing
its transformation into the nation's first full-
service, low-cost airline with today's judicial
confirmation of its Chapter 11 Plan of Reorganization
(POR).
Judge Stephen S. Mitchell of the U.S. Bankruptcy Court
for the Eastern District of Virginia confirmed the
plan at a hearing today, clearing the way for the
US Airways-America West Airlines merger transaction to
formally close by the end of September. The merger
will create the nation's fifth-largest airline, and
provide consumers with new domestic and international
travel choices and an extensive route network
throughout the U.S., Canada, the Caribbean, Latin
America, and Europe.
Judge Mitchell ruled that all necessary requirements
have been met for US Airways to implement its POR.
Every class of creditor for all five debtors --
US Airways Group, Inc., US Airways, Inc., PSA
Airlines, Inc., Piedmont Airlines, Inc., and Material
Services Company, Inc. -- in the Chapter 11 cases that
was entitled to vote on the POR, voted in favor by at
least 90 percent in dollar amount and 80 percent in
the number of votes cast. Under the terms of the
merger agreement, the transaction can close on the
11th day following entry of the court's final order
confirming the plan. US Airways then will emerge from
Chapter 11 and complete its merger with America West
as soon as Sept. 27, 2005.
"This is a great day for both US Airways and America
West," said President and CEO Bruce Lakefield. "For
our customers, we are about to become the kind of
airline that they have been asking for a global
carrier offering full-service amenities and simplified
fares. For our employees, this merger will provide
more stability and a chance to be a part of a vibrant
new company.
"Through our restructuring, we have reduced our debt,
improved our liquidity and strengthened our balance
sheet," Lakefield said. "With the financial position
of other carriers deteriorating, we are pleased that
we will have a very strong cash position, a robust
business plan, a low cost structure, and a strong
network that offers our customers an attractive
product and more choices."
Key elements of the plan include:
--Total equity and liquidity agreements to provide the
merged airline with unrestricted cash of approximately
$1.7 billion, and a total cash position of
approximately $2.5 billion, including approximately
$800 million of restricted cash.
--Investment agreements that total $565 million in new
equity and a public stock offering that is expected to
raise $150 million. Support from business partners
and suppliers that will provide in excess of $700
million in cash, and asset sales and sale-leaseback
agreements that are expected to gross $300 million
pending consummation of certain of the transactions.
--Agreement between US Airways and the Pension Benefit
Guaranty Corp. (PBGC), resolving nearly $2.7 billion
in claims. The agreement provides for US Airways to
pay the PBGC $13.5 million in cash, in addition to
giving the PBGC a $10 million note and 70 percent of
the common stock, which will be allocated to unsecured
creditors.
--The creation of a company with more than $10 billion
in annual revenues and savings of over $600 million
annually through synergies associated with the merger.
--Reinstatement and extension of the Air
Transportation Stabilization Board (ATSB) loans with
amortization through 2010.
Lakefield said that the company's full attention now
will be on the completion of the merger, the
implementation of consistent customer service
offerings, the building of a unified corporate
culture, and the transfer of headquarters functions to
Tempe, Ariz. America West Chairman, President, and
Chief Executive Officer Doug Parker will assume those
same responsibilities at the merged company, with
Lakefield serving as non-executive vice chairman of
the board of directors.
"Doug Parker and the management team he has assembled
are enthusiastically working to make sure that the new
US Airways is an airline that offers customer value,
and one which our combined work force is proud to
represent. I want to express my heartfelt thanks to
our employees, customers, and business partners for
their support of the company throughout this
restructuring. Doug is committed to building upon
that deep level of support and loyalty," Lakefield
said.
Lakefield also expressed his appreciation to the ATSB
for its support in working through a number of issues
related to the America West and US Airways federal
loan guarantees.
US Airways Group, Inc. and its domestic subsidiaries
filed voluntary petitions for reorganization under
Chapter 11 of the U.S. Bankruptcy Code on Sept. 12,
2004.
The merger of US Airways and America West will create
the first full-service, low-cost nationwide airline
with amenities that include international scope, a
broad frequent flyer program, airport clubs, assigned
seating and First Class cabin service. The airlines
have already introduced the new US Airways aircraft
livery design, and over the coming weeks, will be
announcing more specific customer service enhancements
and policies as the airlines implement the merger.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed merger transaction,
US Airways Group has filed a Registration Statement on
Form S-4 (Registration No. 333-126162), which includes
a proxy statement of America West Holdings, and other
documents with the Securities and Exchange Commission.
The proxy statement/prospectus was mailed to
stockholders of America West Holdings after the
registration statement was declared effective by the
SEC on August 11, 2005. WE URGE INVESTORS TO READ THE
REGISTRATION STATEMENT AND PROXY STATEMENT/PROSPECTUS
AND OTHER RELATED MATERIALS CAREFULLY BECAUSE THEY
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION. Investors may obtain free copies of the
registration statement and proxy statement/prospectus
as well as other filed documents containing
information about US Airways Group and America West
Holdings at http://www.sec.gov, the SEC's Web site.
Free copies of America West Holdings' SEC filings are
also available on America West Holdings' Web site at
http://www.shareholder.com/americawest/edgar.cfm, or
by request to Investor Relations, America West
Holdings Corporation, 111 West Rio Salado Pkwy, Tempe,
Arizona 85281. Free copies of US Airways Group's SEC
filings are also available on US Airways Group's Web
site at http://investor.usairways.com/edgar.cfm or by
request to Investor Relations, US Airways Group, Inc.,
2345 Crystal Drive, Arlington, VA 22227.
This communication shall not constitute an offer to
sell or the solicitation of an offer to buy any
securities, nor shall there be any sale of securities
in any jurisdiction in which such offer, solicitation
or sale would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made
except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of
1933, as amended.
PARTICIPANTS IN THE SOLICITATION
America West Holdings, US Airways Group and their
respective executive officers and directors may be
deemed, under SEC rules, to be participants in the
solicitation of proxies from America West Holdings'
stockholders with respect to the proposed transaction.
Information regarding the officers and directors of
America West Holdings is included in its definitive
proxy statement for its 2005 Annual Meeting filed with
the SEC on April 15, 2005. Information regarding the
officers and directors of US Airways Group is included
in its 2004 Annual Report filed with the SEC on Form
10-K on March 1, 2005. More detailed information
regarding the identity of potential participants, and
their interests in the solicitation, is set forth in
the registration statement and proxy statement and
other materials filed with the SEC in connection with
the proposed transaction.
End of Special Bulletin for Friday, Sept. 16, 2005
Corporate Affairs/Telex:HDQCYUS/COMAT
CA-H850
To: Special_Bulletins
From: CRIGLER
Subject: Special Bulletins
To All Employees ... Please Post ... Special Bulletin
US AIRWAYS PLAN OF REORGANIZATION
RECEIVES U.S. BANKRUPTCY COURT APPROVAL
US Airways is now in the final stages of completing
its transformation into the nation's first full-
service, low-cost airline with today's judicial
confirmation of its Chapter 11 Plan of Reorganization
(POR).
Judge Stephen S. Mitchell of the U.S. Bankruptcy Court
for the Eastern District of Virginia confirmed the
plan at a hearing today, clearing the way for the
US Airways-America West Airlines merger transaction to
formally close by the end of September. The merger
will create the nation's fifth-largest airline, and
provide consumers with new domestic and international
travel choices and an extensive route network
throughout the U.S., Canada, the Caribbean, Latin
America, and Europe.
Judge Mitchell ruled that all necessary requirements
have been met for US Airways to implement its POR.
Every class of creditor for all five debtors --
US Airways Group, Inc., US Airways, Inc., PSA
Airlines, Inc., Piedmont Airlines, Inc., and Material
Services Company, Inc. -- in the Chapter 11 cases that
was entitled to vote on the POR, voted in favor by at
least 90 percent in dollar amount and 80 percent in
the number of votes cast. Under the terms of the
merger agreement, the transaction can close on the
11th day following entry of the court's final order
confirming the plan. US Airways then will emerge from
Chapter 11 and complete its merger with America West
as soon as Sept. 27, 2005.
"This is a great day for both US Airways and America
West," said President and CEO Bruce Lakefield. "For
our customers, we are about to become the kind of
airline that they have been asking for a global
carrier offering full-service amenities and simplified
fares. For our employees, this merger will provide
more stability and a chance to be a part of a vibrant
new company.
"Through our restructuring, we have reduced our debt,
improved our liquidity and strengthened our balance
sheet," Lakefield said. "With the financial position
of other carriers deteriorating, we are pleased that
we will have a very strong cash position, a robust
business plan, a low cost structure, and a strong
network that offers our customers an attractive
product and more choices."
Key elements of the plan include:
--Total equity and liquidity agreements to provide the
merged airline with unrestricted cash of approximately
$1.7 billion, and a total cash position of
approximately $2.5 billion, including approximately
$800 million of restricted cash.
--Investment agreements that total $565 million in new
equity and a public stock offering that is expected to
raise $150 million. Support from business partners
and suppliers that will provide in excess of $700
million in cash, and asset sales and sale-leaseback
agreements that are expected to gross $300 million
pending consummation of certain of the transactions.
--Agreement between US Airways and the Pension Benefit
Guaranty Corp. (PBGC), resolving nearly $2.7 billion
in claims. The agreement provides for US Airways to
pay the PBGC $13.5 million in cash, in addition to
giving the PBGC a $10 million note and 70 percent of
the common stock, which will be allocated to unsecured
creditors.
--The creation of a company with more than $10 billion
in annual revenues and savings of over $600 million
annually through synergies associated with the merger.
--Reinstatement and extension of the Air
Transportation Stabilization Board (ATSB) loans with
amortization through 2010.
Lakefield said that the company's full attention now
will be on the completion of the merger, the
implementation of consistent customer service
offerings, the building of a unified corporate
culture, and the transfer of headquarters functions to
Tempe, Ariz. America West Chairman, President, and
Chief Executive Officer Doug Parker will assume those
same responsibilities at the merged company, with
Lakefield serving as non-executive vice chairman of
the board of directors.
"Doug Parker and the management team he has assembled
are enthusiastically working to make sure that the new
US Airways is an airline that offers customer value,
and one which our combined work force is proud to
represent. I want to express my heartfelt thanks to
our employees, customers, and business partners for
their support of the company throughout this
restructuring. Doug is committed to building upon
that deep level of support and loyalty," Lakefield
said.
Lakefield also expressed his appreciation to the ATSB
for its support in working through a number of issues
related to the America West and US Airways federal
loan guarantees.
US Airways Group, Inc. and its domestic subsidiaries
filed voluntary petitions for reorganization under
Chapter 11 of the U.S. Bankruptcy Code on Sept. 12,
2004.
The merger of US Airways and America West will create
the first full-service, low-cost nationwide airline
with amenities that include international scope, a
broad frequent flyer program, airport clubs, assigned
seating and First Class cabin service. The airlines
have already introduced the new US Airways aircraft
livery design, and over the coming weeks, will be
announcing more specific customer service enhancements
and policies as the airlines implement the merger.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed merger transaction,
US Airways Group has filed a Registration Statement on
Form S-4 (Registration No. 333-126162), which includes
a proxy statement of America West Holdings, and other
documents with the Securities and Exchange Commission.
The proxy statement/prospectus was mailed to
stockholders of America West Holdings after the
registration statement was declared effective by the
SEC on August 11, 2005. WE URGE INVESTORS TO READ THE
REGISTRATION STATEMENT AND PROXY STATEMENT/PROSPECTUS
AND OTHER RELATED MATERIALS CAREFULLY BECAUSE THEY
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION. Investors may obtain free copies of the
registration statement and proxy statement/prospectus
as well as other filed documents containing
information about US Airways Group and America West
Holdings at http://www.sec.gov, the SEC's Web site.
Free copies of America West Holdings' SEC filings are
also available on America West Holdings' Web site at
http://www.shareholder.com/americawest/edgar.cfm, or
by request to Investor Relations, America West
Holdings Corporation, 111 West Rio Salado Pkwy, Tempe,
Arizona 85281. Free copies of US Airways Group's SEC
filings are also available on US Airways Group's Web
site at http://investor.usairways.com/edgar.cfm or by
request to Investor Relations, US Airways Group, Inc.,
2345 Crystal Drive, Arlington, VA 22227.
This communication shall not constitute an offer to
sell or the solicitation of an offer to buy any
securities, nor shall there be any sale of securities
in any jurisdiction in which such offer, solicitation
or sale would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made
except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of
1933, as amended.
PARTICIPANTS IN THE SOLICITATION
America West Holdings, US Airways Group and their
respective executive officers and directors may be
deemed, under SEC rules, to be participants in the
solicitation of proxies from America West Holdings'
stockholders with respect to the proposed transaction.
Information regarding the officers and directors of
America West Holdings is included in its definitive
proxy statement for its 2005 Annual Meeting filed with
the SEC on April 15, 2005. Information regarding the
officers and directors of US Airways Group is included
in its 2004 Annual Report filed with the SEC on Form
10-K on March 1, 2005. More detailed information
regarding the identity of potential participants, and
their interests in the solicitation, is set forth in
the registration statement and proxy statement and
other materials filed with the SEC in connection with
the proposed transaction.
End of Special Bulletin for Friday, Sept. 16, 2005
Corporate Affairs/Telex:HDQCYUS/COMAT
CA-H850
