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Republic Offers $125 Million in US Airways

US Airways Group, parent of US Airways, reported it had reached an agreement with Republic Airways Holding Inc. and its majority shareholder Wexford Capital LLC on an equity and financing package that includes a $125 million investment when US Airways emerges from Chapter 11. In addition, it provides options for obtaining $110 million of other liquidity enhancements prior to emergence from Chapter 11 protection to assist the airline in completing its restructuring.

Terms of the agreement were filed with the U.S. Bankruptcy Court for the Eastern District of Virginia. US Airways is seeking the court’s approval at the next monthly meeting on March 31, 2005.

The U.S. Bankruptcy Court approved an earlier financing agreement with Eastshore Aviation LLC, an investment entity owned by Air Wisconsin Airlines Corp. That agreement, approved Feb. 28, 2005, extended a $125 million facility structured as a debtor-in-possession term loan. It provided $75 million immediately and $25 million in two subsequent increments. That loan would convert into equity ownership in the reorganized airline once US Airways emerged from Chapter 11 protection.

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