US Airways Signs Lease Agreement

6th Jan 2004

US Airways has signed a long-term lease agreement for 10 gates and related
terminal and support facilities at Pittsburgh International Airport, to
replace the lease that was rejected as part of the company`s Chapter 11

Under the agreement, US Airways will lease 10 gates and associated
operations and ticketing space on a signatory basis through 2018. The
balance of 40 gates and other facilities currently used by US Airways and
its US Airways Express carriers at Pittsburgh will be leased on a
month-to-month, non-signatory basis.

Additionally, US Airways has signed a three-year lease agreement for its
current on-airport support facilities, including maintenance hangars,
cargo, mail sorting and foodservice facilities. This includes an option
for either party to terminate the agreement with respect to all or part of
the facilities after the first year.

The company said that it will continue to negotiate with the Allegheny
County Airport Authority, Allegheny County and the Commonwealth of
Pennsylvania in the hope that a broader agreement can be reached in order
to maintain its hub operations at Pittsburgh. State and local officials
are exploring whether new revenue sources can be devoted to relieve
airlines operating at Pittsburgh of some of the cost of servicing the $640
million debt load the airport carries. In the meantime, US Airways has
agreed to operate a schedule close to its existing service at Pittsburgh
through September 2004, in order to allow negotiations to continue.

“We are quite appreciative of the leadership Allegheny County Executive
Dan Onorato has already demonstrated in reaching an alternative agreement
for facilities while we collectively explore all other options,” said
Christopher Chiames, US Airways` senior vice president of corporate
affairs. “We remain optimistic that Mr. Onorato can work constructively
with Governor Rendell and the Airport Authority to identify new sources of
revenue for the airport. Our discussions over the past several months have
demonstrated that all parties recognize that this is about new revenue and
lowering the cost of doing business at the airport for all airlines, and
not a subsidy targeted to US Airways.”
Chiames said that US Airways officials recognize that a budget crisis in
the state, and competing state and local fiscal priorities have extended
the process beyond what was originally envisioned.


“When we rejected the leases last March, effective Jan. 5, 2004, we
believed it gave all parties plenty of time to find a solution that would
allow us to cost-effectively maintain our Pittsburgh hub,” said Chiames.
“Despite the lengthy process, our conversations with public officials
remain constructive, and at the same time, they recognize that we are
trying to complete a financial restructuring that did not end with our
emergence from Chapter 11 last year. We understand that public officials
have some difficult choices to make, and in turn, they understand that we
must begin making business decisions very soon and that these negotiations
must be concluded quickly.”
As a signatory for 10 gates and related facilities, US Airways still has
the largest financial commitment to the Allegheny County Airport Authority
of any airline serving Pittsburgh.

US Airways currently serves nearly 100 destinations nonstop with
approximately 375 daily flights from Pittsburgh International Airport.



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