Quarterly Report (SEC form 10-Q)


Aug 30, 2002
[P][A href=http://biz.yahoo.com/e/021114/u10-q.html]http://biz.yahoo.com/e/021114/u10-q.html[/A][/P]
[P]This report is entitled Management''s Discussion and Analysis of Financial Condition and Results of Operations. Sadly it contains some very disturbing comments such as are quoted below. USAirways and UAL, effective January are to be a major partners. Its my view that even though labor did not create this industry''s mess, it is in our own very best interests to sacrifice, in the name of the long term to assure our companies continuing viabilities. Lets hope revenues increase before hub carriers become things of the past. DENVER,CO[/P]
[P] The ability of the Company, both during and after the Chapter 11 cases, to continue as a going-concern is dependent upon, among other things, (i) the Company''s ability to comply with the terms of the DIP Facility and any cash management order entered by the Bankruptcy Court in connection with the Chapter 11 cases; (ii) the ability of the Company to successfully achieve required cost savings to complete its restructuring; (iii) the ability of the Company to maintain adequate cash on hand; (iv) the ability of the Company to generate cash from operations; (v) the ability of the Company to confirm a plan of reorganization under the Bankruptcy Code and obtain emergence financing including the loan guarantee under the Stabilization Act; and (vi) the Company''s ability to achieve profitability. [STRONG][FONT style=BACKGROUND-COLOR: #ffff99]Uncertainty as to the outcome of these factors raises substantial doubt about the Company''s ability to continue as a going-concern. [/FONT][/STRONG]The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might result should the Company be unable to continue as a going-concern. [/P]
Post all the report and don't cherry pick


As part of its restructuring efforts, US Airways sought and received conditional approval for a $900 million loan guarantee under the Stabilization Act from the Stabilization Board in connection with a proposed $1 billion loan financing. US Airways applied for this loan and related guarantee in order to provide additional liquidity necessary to carry out its restructuring plan. The Stabilization Board's conditions to issuance of the ATSB Guarantee included, among other things, the execution and delivery of legally binding agreements acceptable to the Stabilization Board containing economic concessions from key stakeholders, as well as an agreement to issue a sufficient number of stock warrants to the Stabilization Board at a strike price acceptable to the Stabilization Board.

The regulations promulgated pursuant to the Stabilization Act provide that an eligible borrower must be an air carrier that can demonstrate, to the satisfaction of the Stabilization Board, that it is not under bankruptcy protection or receivership when the Stabilization Board issues the guarantee, unless the guarantee and the underlying financial obligation are to be part of a bankruptcy court-certified reorganization plan. Subsequent to the Company's and US Airways' Chapter 11 filings, the Stabilization Board issued a statement that its conditional approval of US Airways' application for the loan guarantee remains in effect. The Company continues to provide supplemental information to the Stabilization Board in connection with developing its plan of reorganization. The Company expects that closing on the ATSB Guarantee will require confirmation of a plan of reorganization in which the Company can achieve financial and operational benchmarks acceptable to the Stabilization Board.
[BR]Ua767fo:[BR][BR]In fairness you should post all of the report, just not the boiler plate disclosure information. If UA enters bankruptcy, which management said could occur within two weeks, UA will have the same disclosure information.[BR][BR][FONT style=BACKGROUND-COLOR: #ffff33][STRONG]The Company expects that closing on the ATSB Guarantee will require confirmation of a plan of reorganization in which the Company can achieve financial and operational benchmarks acceptable to the Stabilization Board. [BR][/STRONG][BR][FONT style=BACKGROUND-COLOR: #ffffff]Ua767fo, your motives are transparent. By the way, why did you forget to post the company expects to emerge from bankruptcy in the first quarter of 2003, which is a fast track reorganization, and news about the Equity Investor?[BR][BR]Chip[/FONT][/FONT]
Here's an excerpt that addresses the issue of US Common Stock:

Under the priority scheme established by the Bankruptcy Code, unless creditors agree otherwise, pre-petition liabilities and post-petition liabilities must be satisfied in full before shareholders are entitled to receive any distribution or retain any property under a plan. The ultimate recovery to creditors and/or common shareholders, if any, will not be determined until confirmation of a plan or plans of reorganization. No assurance can be given as to what values, if any, will be ascribed in the Chapter 11 cases to each of these constituencies or what types or amounts of distributions, if any, they would receive. A plan of reorganization could result in holders of the Company's common stock (Common Stock) receiving no distribution on account of their interests and cancellation of their existing stock. The RSA Investment, if consummated, contemplates the cancellation of the Common Stock. As discussed above, if the requirements of section 1129(B) of the Bankruptcy Code are met, a plan of reorganization can be confirmed notwithstanding its rejection by the holders of the Company's Common Stock and notwithstanding the fact that such holders do not receive or retain any property on account of their equity interests under the plan.