15,200,000 SHARES OF COMMON
STOCK
To the Managers
named in
Schedule II hereto
for the several Underwriters
named in Schedule III hereto
US Airways Group,
Inc., a Delaware corporation (the “ Company ”),
proposes to issue and sell to the several underwriters named in
Schedule III hereto (the “ Underwriters ”),
for whom you are acting as managers (the “ Managers
”), 15,200,000 shares of its common stock, par value $0.01
per share (the “ Firm Shares ”). The Company
also proposes to issue and sell to the several Underwriters not
more than 2,280,000 additional shares of its common stock, par
value $0.01 per share (the “ Additional Shares
”), if and to the extent that Citigroup Global Markets Inc.
shall have determined to exercise, on behalf of the Underwriters,
the right to purchase such Additional Shares granted to the
Underwriters in Section 2 hereof. The Firm Shares and the
Additional Shares are hereinafter collectively referred to as the
“ Shares .” The shares of common stock, par
value $0.01 per share of the Company to be outstanding after giving
effect to the sales contemplated hereby are hereinafter referred to
as the “ Common Stock. ”
Concurrently with
the issuance of the Shares, the Company is offering, in an offering
(the “ Concurrent Offering ”) registered under
the Securities Act of 1933, as amended (the “ Securities
Act ”), by means of a prospectus supplement and related
prospectus, $150,000,000 principal amount of its 7.25% Convertible
Senior Notes due 2014 (the “ Notes ”). The
Company has granted the underwriters of the Concurrent Offering an
option to purchase up to an additional $22,500,000 principal amount
of the Notes to cover over-allotments, if any. The Notes will be
convertible into shares of Common Stock in accordance with the
terms of thereof and the indenture under which they are
issued.
The Company has
filed with the Securities and Exchange Commission (the “
Commission ”) a registration statement, including a
prospectus, (the file number of which is set forth in Schedule II
hereto) on Form S-3, relating to securities (the “ Shelf
Securities ”), including the Shares, to be issued from
time to time by the Company. The registration statement as amended
to the date of this Agreement, including the information (if any)
deemed to be part of the registration statement at the time of
effectiveness pursuant to Rule 430A or Rule 430 B under
the Securities Act, is hereinafter referred to as the “
Registration Statement ”, and the related prospectus
covering the Shelf Securities dated October 4, 2006 in the
form first used to confirm sales of the Shares (or in the form
first made available to the Underwriters by the Company to meet
requests of purchasers pursuant to Rule 173 under the
Securities Act) is hereinafter referred to as the “ Base
Prospectus. ” The Base Prospectus, as supplemented by the
prospectus supplement specifically relating to the Shares in the
form first used to confirm sales of the Shares (or in the form
first made available to the Underwriters by the Company to meet
requests of purchasers pursuant to Rule 173 under the
Securities Act) is hereinafter referred to as the
2
“
Prospectus ,” and the term “ preliminary
prospectus ” means the preliminary form of the Prospectus
dated May 6, 2009 and distributed to prospective purchasers of
the Shares.
For purposes of
this Agreement, “ free writing prospectus ” has
the meaning set forth in Rule 405 under the Securities Act, “
Time of Sale Prospectus ” means the preliminary
prospectus, together with the free writing prospectuses, if any,
and the final offering terms, each included in Schedule II hereto,
and “ broadly available road show ” means a
“bona fide electronic road show” as defined in
Rule 433(h)(5) under the Securities Act that has been made
available without restriction to any person. As used herein, the
terms “Registration Statement,” “Base
Prospectus,” “preliminary prospectus,”
“Time of Sale Prospectus” and “Prospectus”
shall include the documents, if any, incorporated by reference
therein. The terms “ supplement ,” “
amendment ,” and “ amend ” as used
herein with respect to the Registration Statement, the Base
Prospectus, the Time of Sale Prospectus, and any preliminary
prospectus or free writing prospectus shall include all documents
subsequently filed by the Company with the Commission pursuant to
the Securities Exchange Act of 1934, as amended (the “
Exchange Act ”), that are deemed to be incorporated by
reference therein.
1.
Representations and Warranties. The Company represents and
warrants to, and agrees with, the Underwriters that:
(a) The Company
meets the requirements for the use of Form S-3 under the Securities
Act; the Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or,
to the Company’s knowledge, threatened by the Commission. The
Registration Statement is an automatic shelf registration statement
(as defined in Rule 405 under the Securities Act), the Company is a
well-known seasoned issuer (as defined in Rule 405 under the
Securities Act) eligible to use the Registration Statement as an
automatic shelf registration statement and the Company has not
received notice that the Commission objects to the use of the
Registration Statement as an automatic shelf registration
statement.
(i) Each document,
if any, filed or to be filed pursuant to the Exchange Act and
incorporated by reference in the Time of Sale Prospectus or the
Prospectus complied, or will comply when so filed, in all material
respects with the Exchange Act and the applicable rules and
regulations of the Commission thereunder, (ii) each part of
the Registration Statement, when such part became effective, did
not contain, and each such part, as amended or supplemented, if
applicable, will not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading,
(iii) the Registration Statement as of the date hereof does
not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading, (iv) the
Registration Statement and the Prospectus comply as to form, and as
amended or supplemented, if applicable, will comply as to form, in
all material respects with the Securities Act and the applicable
rules and regulations of the Commission thereunder, (v) the Time of
Sale Prospectus does not, and at the time of each sale of the
Shares in connection with the offering when the Prospectus is not
yet available to prospective purchasers and at the Closing Date (as
defined in Section 4), the Time of Sale
3
Prospectus, as
then amended or supplemented by the Company, if applicable, will
not, contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, (vi) each broadly available road show, if any,
when considered together with the Time of Sale Prospectus, does not
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not
misleading and (vii) the Prospectus, as of the date hereof,
does not contain and as amended or supplemented, if applicable, at
the Closing Date (as defined in Section 4) will not contain
any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except
that the representations and warranties set forth in this paragraph
do not apply to statements or omissions in the Registration
Statement, the Time of Sale Prospectus or the Prospectus, based
upon information relating to any Underwriter furnished to the
Company in writing by such Underwriter through you expressly for
use therein.
(b) The Company is
not an “ineligible issuer” in connection with the
offering pursuant to Rules 164, 405 and 433 under the
Securities Act. Any free writing prospectus that the Company is
required to file pursuant to Rule 433(d) under the Securities Act
has been, or will be, filed with the Commission in accordance with
the requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder. Each free writing
prospectus that the Company has filed, or is required to file,
pursuant to Rule 433(d) under the Securities Act or that was
prepared by or on behalf of or used or referred to by the Company
complies or will comply in all material respects with the
requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder. Except for the free
writing prospectuses, if any, identified in Schedule II hereto
forming part of the Time of Sale Prospectus, and electronic road
shows, if any, each furnished to you before first use, the Company
has not prepared, used or referred to, and will not, without your
prior consent, prepare, use or refer to, any free writing
prospectus.
(c) The Company
has been duly incorporated, is validly existing as a corporation in
good standing under the laws of the State of Delaware, has the
corporate power and authority to own its property and to conduct
its business as described in the Time of Sale Prospectus and the
Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its
business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a
whole.
(d) Each
subsidiary of the Company has been duly incorporated or organized,
is validly existing as a corporation or limited liability company,
as the case may be, in good standing under the laws of the
jurisdiction of its incorporation or organization, has the
corporate or other power and authority to own its property and to
conduct its business as described in the Time of Sale Prospectus
and the Prospectus and is duly qualified to transact business and
is in good standing in each jurisdiction in which the conduct of
its
4
business or its
ownership or leasing of property requires such qualification,
except to the extent that the failure to be so duly incorporated,
organized or qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken
as a whole; all of the issued shares of capital stock or membership
interests, as the case may be, of each subsidiary of the Company
have been duly and validly authorized and issued, are fully paid
and non-assessable and are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or
claims, except liens, encumbrances or claims which would not have a
material adverse effect on the Company and its subsidiaries, taken
as a whole.
(e) This Agreement
has been duly authorized, executed and delivered by the
Company.
(f) The authorized
capital stock of the Company conforms in all material respects as
to legal matters to the description thereof contained in each of
the Time of Sale Prospectus and the Prospectus.
(g) The shares of
Common Stock outstanding prior to the issuance of the Shares have
been duly authorized and are validly issued, fully paid and
non-assessable.
(h) The Shares
have been duly authorized and, when issued and delivered in
accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of such
Shares will not be subject to any preemptive or similar
rights.
(i) The execution
and delivery by the Company of, and the performance by the Company
of its obligations under, this Agreement will not contravene any
provision of applicable law or the certificate of incorporation or
by-laws of the Company or any agreement or other instrument binding
upon the Company or any of its subsidiaries that is material to the
Company and its subsidiaries, taken as a whole, or any final
judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the
performance by the Company of its obligations under this Agreement,
except such as may be required by the securities or Blue Sky laws
of the various states in connection with the offer and sale of the
Shares.
(j) There has not
occurred any material adverse change, or any development reasonably
likely to involve a material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its subsidiaries, taken as a whole, from that
set forth in the Time of Sale Prospectus.
(k) There are no
legal or governmental proceedings pending or, to the
Company’s knowledge, threatened to which the Company or any
of its subsidiaries is a party or to which any of the properties of
the Company or any of its subsidiaries is subject (i) other
than proceedings accurately described in all material respects in
each of the Time of Sale Prospectus and the Prospectus and
proceedings that would not have a
5
material
adverse effect on the Company and its subsidiaries, taken as a
whole, or on the power or ability of the Company to perform its
obligations under this Agreement or to consummate the transactions
contemplated by the Time of Sale Prospectus or (ii) that are
required to be described in the Registration Statement or the
Prospectus and are not so described; and there are no statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be
filed as exhibits to the Registration Statement that are not
described or filed as required.
(l) Each
preliminary prospectus filed as part of the Registration Statement
as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when
so filed in all material respects with the Securities Act and the
applicable rules and regulations of the Commission
thereunder.
(m) The Company is
not, and after giving effect to the offering and sale of the Shares
and the application of the proceeds thereof as described in the
Time of Sale Prospectus and the Prospectus, will not be an
“investment company” as such term is defined in the
Investment Company Act of 1940, as amended.
(n) The Company
and its subsidiaries (i) are in compliance with any and all
applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants
or contaminants (“ Environmental Laws ”),
(ii) have received all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in compliance with
all terms and conditions of any such permit, license or approval,
except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or
approvals would not, singly or in the aggregate, have a material
adverse effect on the Company and its subsidiaries, taken as a
whole.
(o) There are no
costs or liabilities associated with Environmental Laws (including,
without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities
to third parties) which would, singly or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken
as a whole.
(p) There are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to
file a registration statement under the Securities Act with respect
to any securities of the Company or to require the Company to
include such securities with the Shares registered pursuant to the
Registration Statement.
(q) The
consolidated financial statements included or incorporated by
reference in the Registration Statement and the Time of Sale
Prospectus present fairly the consolidated financial position of
the Company and its consolidated subsidiaries as of the dates
indicated and the consolidated results of operations and cash flows
or changes in
6
financial
position of the Company and its consolidated subsidiaries for the
periods specified. Except as stated therein, such financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the
periods involved. The financial statement schedules, if any,
included or incorporated by reference in the Registration Statement
and the Time of Sale Prospectus present fairly the information
required to be stated therein.
(r) Subsequent to
the respective dates as of which information is given in the
Registration Statement and the Time of Sale Prospectus,
(i) neither the Company nor any of its subsidiaries has
incurred any material liability or obligation, direct or
contingent, or entered into any material transaction, in each case,
not in the ordinary course of business or as described in,
contemplated by or incorporated by reference into the Time of Sale
Prospectus and the Prospectus (including, without limitation,
aircraft acquisitions or financing and equity incentive plan grants
so described in or contemplated by the Time of Sale Prospectus and
the Prospectus); (ii) the Company has not purchased any of its
outstanding capital stock, nor declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock (other
than repurchases of unvested shares of the Company’s capital
stock pursuant to its equity incentive plans); (iii) there has
not been any material change in the capital stock, short-term debt
or long-term debt of the Company except in each case as described
in, contemplated by or incorporated by reference into the Time of
Sale Prospectus and the Prospectus (including, without limitation,
aircraft financing and equity incentive plan grants so described
in, contemplated by or incorporated by reference into the Time of
Sale Prospectus and the Prospectus); and (iv) there has been
no prohibition or suspension of the Company’s operating
certificate for the operation of the Company’s aircraft,
including as a result of action taken by the Federal Aviation
Administration (“ FAA ”) or the Department of
Transportation.
(s) Each of the
Company and its subsidiaries has good and marketable title in fee
simple to all real property and good and marketable title to all
personal property owned by it which is material to the business of
the Company and its subsidiaries, in each case free and clear of
all liens, encumbrances and defects, except liens on real property,
aircraft and engines, parts, rotables, and other equipment of the
Company and such as are described in or incorporated by reference
into the Time of Sale Prospectus or such as do not materially
affect the value of such property or do not interfere with the use
made and proposed to be made of such property by the Company or its
subsidiaries, as the case may be; and any real property and
buildings held under lease by the Company or any of its
subsidiaries are held by it under valid, subsisting and enforceable
leases with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such
property and buildings by the Company or its subsidiaries, in each
case except as described in or contemplated by the Time of Sale
Prospectus and the Prospectus.
(t) (i) Each
of the Company and its subsidiaries possesses such permits,
licenses, approvals, consents and other authorizations
(collectively, “ Government Licenses ”) issued
by the appropriate federal, state, local or foreign regulatory
agencies or bodies, including the Department of Transportation, the
FAA or the Federal
7
Communications
Commission necessary to conduct the business now operated by it,
except where the failure to possess any such Government License
would not, singly or in the aggregate, have a material adverse
effect on the Company and its subsidiaries, taken as a whole; (ii)
each of the Company and its subsidiaries is in compliance with the
terms and conditions of all such Governmental Licenses, except
where the failure so to comply would not, singly or in the
aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole; (iii) all of the Government
Licenses are valid and in full force, except where the invalidity
of such Governmental Licenses or the failure of such Governmental
Licenses to be in full force and effect would not, singly or in the
aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole; and (iv) the Company has not
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in
the aggregate, is reasonably likely to have a material adverse
effect on the Company and its subsidiaries, taken as a
whole.
(u) Except as
described in or contemplated by the Time of Sale Prospectus and the
Prospectus, no material labor dispute with the employees of the
Company or its subsidiaries exists or, to the knowledge of the
Company, is imminent; and the Company is not aware, but without any
independent investigation or inquiry, of any existing, threatened
or imminent labor disturbance by the employees of any of its
principal suppliers, manufacturers or contractors that could
reasonably likely result in any material adverse change in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a
whole.
(v) Each of the
Company and its subsidiaries is insured by insurers of recognized
financial responsibility against such losses and risks and in such
amounts as are customary in the businesses in which it is engaged;
provided, that the Company currently maintains war risk insurance
on its aircraft under the FAA’s insurance program authorized
under 49 U.S.C. § 44301 et seq. (“ War Risk
Insurance ”); each of the Company and its subsidiaries
has not been refused any insurance coverage sought or applied for
other than in connection with instances where the Company was
seeking to obtain insurance coverage at more attractive rates; and,
other than with respect to War Risk Insurance coverage, the Company
has no reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not have a material
adverse effect on the Company and its subsidiaries, taken as a
whole, except as described in or contemplated by the Time of Sale
Prospectus and the Prospectus.
(w) The Company
maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are
executed in accordance with management’s general or specific
authorizations in all material respects and (ii) transactions are
recorded as necessary to permit preparation of financial statements
in conformity with generally accepted accounting principles and to
maintain asset accountability.
8
(x) US Airways,
Inc. (i) is an “air carrier” within the meaning of
49 U.S.C. Section 40102(a); (ii) holds an air carrier
operating certificate issued by the Secretary of Transportation
pursuant to Chapter 447 of Title 49 of the United States Code
for aircraft capable of carrying 10 or more individuals or 6,000
pounds or more of cargo; and (iii) is a “citizen of the
United States” as defined in 49 U.S.C.
Section 401102.
(y) KMPG LLP, who
reported on the annual consolidated financial statements of the
Company incorporated by reference in the Registration Statement and
the Prospectus, is an independent registered public accounting firm
as required by the Securities Act.
(z) Neither the
Company nor any of its subsidiaries or affiliates, nor, to the
Company’s knowledge, any director, officer, or employee, any
agent or representative of the Company or of any of its
subsidiaries or affiliates, has taken any action in furtherance of
an offer, payment, promise to pay, or authorization or approval of
the payment or giving of money, property, gifts or anything else of
value, directly or indirectly, to any “government
official” (including any officer or employee of a government
or government-owned or controlled entity or of a public
international organization, or any person acting in an official
capacity for or on behalf of any of the foregoing, or any political
party or party official or candidate for political office) to
influence official action or secure an improper advantage; and the
Company and its subsidiaries and affiliates have conducted their
businesses in compliance with applicable anti-corruption laws,
including the Foreign Corrupt Practices Act of 1977, as amended,
and the rules and regulations thereunder, and have instituted and
maintain and will continue to maintain policies and procedures
designed to promote and achieve compliance with such laws and with
the representation and warranty contained herein.
(aa) The
operations of the Company and its subsidiaries are and have been
conducted in material compliance with all applicable financial
recordkeeping and reporting requirements, including those of the
Bank Secrecy Act, as amended by Title III of the Uniting and
Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and
the applicable anti-money laundering statutes of jurisdictions
where the Company and its subsidiaries conduct business, the rules
and regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by any
governmental agency (collectively, the “ Anti-Money
Laundering Laws ”), and no action, suit or proceeding by
or before any court or governmental agency, authority or body or
any arbitrator involving the Company or any of its subsidiaries
with respect to the Anti-Money Laundering Laws is pending or, to
the knowledge of the Company, threatened.
(bb) (i) The
Company represents that neither the Company nor any of its
subsidiaries or, to the knowledge of the Company, any director or
officer of the Company or any of its subsidiaries, is an individual
or entity (“ Person ”) that is, or is owned or
controlled by a Person that is:
(A) the subject of
any sanctions administered or enforced by the U.S. Department of
Treasury’s Office of Foreign Assets Control (“
OFAC ”), the
9
United Nations
Security Council (“ UNSC ”), the European Union
(“ EU ”), Her Majesty’s Treasury (“
HMT ”) or other relevant sanctions authorities
(collectively, “ Sanctions ”), nor
(B) located,
organized or resident in a country or territory that is the subject
of Sanctions (including, without limitation, Burma/Myanmar, Cuba,
Iran, North Korea, Sudan or Syria).
(ii)
The Company represents and covenants that it will not, directly or
indirectly, use the proceeds of the offering, or lend, contribute
or otherwise make available such proceeds to any subsidiary, joint
venture partner or other Person:
(A) to fund or
facilitate any activities or business of or with any Person or in
any country or territory that, at the time of such funding or
facilitation, is the subject of Sanctions; or
(B) in any other
manner that will result in a violation of Sanctions by any Person
(including any Person participating in the offering, whether as
underwriter, advisor, investor or otherwise).
(iii)
The Company represents and covenants that, for the past four years,
it has not engaged in, is not now engaged in, and will not engage
in, any dealings or transactions with any Person, or in any country
or territory, that at the time of the dealing or transaction is or
was the subject of Sanctions.
(cc) The Company
and its subsidiaries’ internal controls over financial
reporting are effective and the Company and its subsidiaries are
not aware of any material weakness in their internal controls over
financial reporting.
(dd) The Company
and its subsidiaries maintain “disclosure controls and
procedures” (as such term is defined in Rule 13a-15(e)
under the Exchange Act); such disclosure controls and procedures
are e
|
