Interesting news I just picked up. This would explain the recent non-core asset sales. Not sure at this point if this lowers the covenants that need to be met for the remainder of the case.
In any event - I think this is further evidence that progress is being made and prudent steps are being taken. The important part is that UA and the lenders agree and this has occured before.
--
UAL, Lenders Seek Crt OK Of Some Waivers Under DIP Loans
By NICHOLAS P. BRAUDE
WASHINGTON -- UAL Corp. (UALAQ), the parent of United Airlines, is asking the bankruptcy court overseeing its case to approve some waivers and amendments under the carrier's debtor-in-possession financing facilities and to pay amendment fees to the lenders.
In a motion filed with the court Wednesday and obtained by Dow Jones
Newswires, UAL said that it and its DIP lenders have recently amended the
credit facilities to document waivers of some alleged technical defaults. The
modifications are subject to bankruptcy court approval.
The U.S. Bankruptcy Court in Chicago has scheduled a hearing on
matter for Oct. 24. Interested parties may file objections through Friday.
The proposed amendments wouldn't change amounts available under the
DIP loans, and the court has previously approved similar amendments.
The Chicago court last December approved the company's $1.2 billion
DIP financing agreement with a group of lenders that includes J.P. Morgan
(JPM), Citigroup Inc. ©, Bank One Corp. (ONE) and CIT Group (CIT). The
court also approved a standalone $300 million term loan with Bank One N.A.
The motion Wednesday said that the lenders have agreed to UAL's
proposed sale of its stock in online travel services Orbitz and Hotwire. UAL
said in court papers that it intends to use proceeds from those sales to pay
down amounts due under the DIP financing.
Under the amended credit pacts, the lenders would consent to the
airline modifying service along any of its routes in connection with
discontinued service on its San Francisco-to-Taipei route, the motion said.
The modified DIP agreements also call for the lenders to consent to
restructuring some of UAL's existing debts and to payment of a deposit under
the airline's fuel supply agreement.
Among the fees UAL would have to pay to the lenders are an amendment
fee that wouldn't exceed $895,000 and a $500,000 total arrangement fee to
lenders JPMorgan Chase Bank and Citicorp USA Inc. UAL would pay a $300,000
amendment fee to Bank One, the motion said.
-By Nicholas P. Braude; Dow Jones Newswires; 202-862-1355;
[email protected]
Updated October 15, 2003 2:48 p.m.
In any event - I think this is further evidence that progress is being made and prudent steps are being taken. The important part is that UA and the lenders agree and this has occured before.
--
UAL, Lenders Seek Crt OK Of Some Waivers Under DIP Loans
By NICHOLAS P. BRAUDE
WASHINGTON -- UAL Corp. (UALAQ), the parent of United Airlines, is asking the bankruptcy court overseeing its case to approve some waivers and amendments under the carrier's debtor-in-possession financing facilities and to pay amendment fees to the lenders.
In a motion filed with the court Wednesday and obtained by Dow Jones
Newswires, UAL said that it and its DIP lenders have recently amended the
credit facilities to document waivers of some alleged technical defaults. The
modifications are subject to bankruptcy court approval.
The U.S. Bankruptcy Court in Chicago has scheduled a hearing on
matter for Oct. 24. Interested parties may file objections through Friday.
The proposed amendments wouldn't change amounts available under the
DIP loans, and the court has previously approved similar amendments.
The Chicago court last December approved the company's $1.2 billion
DIP financing agreement with a group of lenders that includes J.P. Morgan
(JPM), Citigroup Inc. ©, Bank One Corp. (ONE) and CIT Group (CIT). The
court also approved a standalone $300 million term loan with Bank One N.A.
The motion Wednesday said that the lenders have agreed to UAL's
proposed sale of its stock in online travel services Orbitz and Hotwire. UAL
said in court papers that it intends to use proceeds from those sales to pay
down amounts due under the DIP financing.
Under the amended credit pacts, the lenders would consent to the
airline modifying service along any of its routes in connection with
discontinued service on its San Francisco-to-Taipei route, the motion said.
The modified DIP agreements also call for the lenders to consent to
restructuring some of UAL's existing debts and to payment of a deposit under
the airline's fuel supply agreement.
Among the fees UAL would have to pay to the lenders are an amendment
fee that wouldn't exceed $895,000 and a $500,000 total arrangement fee to
lenders JPMorgan Chase Bank and Citicorp USA Inc. UAL would pay a $300,000
amendment fee to Bank One, the motion said.
-By Nicholas P. Braude; Dow Jones Newswires; 202-862-1355;
[email protected]
Updated October 15, 2003 2:48 p.m.
