United Launches Bankruptcy Exit

January 10, 2006

January 10, 2006 – United Airlines’ parent company announced Monday it has launched its bankruptcy exit financing loan of up to $3 billion. The six-year loan will help the airline emerge from Chapter 11 bankruptcy protection after 37 months.

A bankruptcy judge must first sign off on the company’s exit plan following a Jan. 18 hearing. The airline said it intends to leave bankruptcy "on or about" Feb. 1.

The loan is secured by United’s existing assets and is comprised of a $300 million revolving credit facility and a loan of as much as $2.7 billion.

Kathryn Mikells, vice president and treasurer at United, said the ratings show Untied is well positioned "to compete with the strongest carriers." She said the airline will exit bankruptcy next month as a much stronger carrier, "with credit ratings that are superior to those of our network peers."

United announced plans last week to spend more money on airline improvements in 2006 now that its restructuring is virtually complete, earmarking $400 million for capital improvements such as more check-in kiosks, refurbished airplane interiors, upgraded computer systems and new ground equipment.