<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1993
(Commission file number: 1-8444)
USAir, Inc. Employee Savings Plan
USAir Group, Inc.
2345 Crystal Drive, Arlington, VA 22227
(Address of principal executive offices)
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<PAGE>
USAIR, INC.
EMPLOYEE SAVINGS PLAN
Financial Statements and Schedules
December 31, 1993
(With Independent Auditors' Report Thereon)
<PAGE>
USAIR, INC.
EMPLOYEE SAVINGS PLAN
Table of Contents
Page
Independent Auditors' Report 1
Financial Statements:
Statement of Net Assets Available for Plan
Benefits as of December 31, 1993 2
Statement of Changes in Net Assets Available
for Plan Benefits for the year ended
December 31, 1993 3
Notes to Financial Statements 4-9
Schedule I - Item 27a
Schedule of Assets Held for Investment Purposes
as of December 31, 1993 10
Schedule II - Item 27d
Schedule of Reportable Transactions for the
year ended December 31, 1993 11
<PAGE>
Independent Auditors' Report
The Plan Administrator and Participants
USAir Inc. Employee Savings Plan:
We have audited the accompanying statement of net assets
available for plan benefits of the USAir, Inc. Employee Savings
Plan (the Plan) as of December 31, 1993, and the related
statement of changes in net assets available for plan benefits
for the year then ended. These financial statements are the
responsibility of the Plan's management. Our responsibility is
to express an opinion on these financial statements based on our
audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the net assets
available for plan benefits of the Plan as of December 31, 1993,
and the changes in net assets available for plan benefits for the
year then ended in conformity with generally accepted accounting
principles.
Our audit was made for the purpose of forming an opinion on the
financial statements taken as a whole. The supplemental
schedules of assets held for investment purposes as of
December 31, 1993 and reportable transactions for the year ended
December 31, 1993 are presented for the purpose of additional
analysis and are not a required part of the basic financial
statements, but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedules have been subjected to the
auditing procedures applied in the audit of the basic financial
statements and, in our opinion, are fairly stated in all material
respects in relation to the basic financial statements taken as a
whole.
/s/ KPMG Peat Marwick
KPMG Peat Marwick
Washington, D. C.
June 3, 1994
1
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USAIR, INC.
EMPLOYEE SAVINGS PLAN
Statement of Net Assets Available for Plan Benefits
---------------------------------------------------
December 31, 1993
<TABLE>
<CAPTION>
<S> <C>
Assets:
Investments, at fair value:
Fidelity Retirement Government Money
Market Fund $ 10,246,736
Fidelity Magellan Fund 47,219,647
Fidelity Intermediate Bond Fund 9,692,261
Fidelity Equity Income Fund 19,424,073
Fidelity U.S. Equity Index Fund 6,955,425
USAir Common Stock Fund 1,404,284
-----------
94,942,426
USAir Guaranteed Investment Fund, at
contract value 10,728,484
Participant loans receivable 2,610,488
-----------
Total investments 108,281,398
Receivables:
Participant contributions 11,524
Employer contributions 3,642
-----------
Total assets 108,296,564
Liabilities:
Accrued administrative expenses 5,680
-----------
Net assets available for plan benefits $108,290,884
===========
</TABLE>
See accompanying notes to financial statements.
2
<PAGE>
USAIR, INC.
EMPLOYEE SAVINGS PLAN
Statement of Changes in Net Assets Available for Plan Benefits
--------------------------------------------------------------
Year ended December 31, 1993
<TABLE>
<CAPTION>
<S> <C>
Additions to net assets attributable to:
Net appreciation in fair value of investments $ 5,389,693
Investment income 6,076,440
Interest income on participant loans 126,069
Participant contributions 30,634,045
Employer contributions 10,254,450
Rollover contributions 264,035
Transfer from the USAir, Inc. 401(k) Savings
Plan 56,592,761
Transfers from other plans 19,848
-----------
Total additions 109,357,341
Deductions from net assets attributable to:
Benefits paid to participants 1,033,839
Administrative expenses 17,842
Other expenses 14,776
-----------
Total deductions 1,066,457
-----------
Net increase in net assets available for
plan benefits 108,290,884
Net assets available for plan benefits:
Beginning of year -
-----------
End of year $108,290,884
===========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
USAIR, INC.
EMPLOYEE SAVINGS PLAN
Notes to Financial Statements
-----------------------------
December 31, 1993
(1) Description of Plan
The following brief description of the USAir, Inc. Employee
Savings Plan (the Plan) is provided for general information
purposes only. Participants should refer to the Plan docu-
ment for more complete information.
(a) General
The Plan is a defined contribution plan intended to be
a qualified cash or deferred arrangement under Section
401(k) of the Internal Revenue Code, as amended (the
Code) and to qualify under Section 401(a). The Plan
was established on January 1, 1993 for certain employ-
ees of USAir, Inc. (USAir or the Company). All non-
contract and certain union employees who are at least
18 years of age, have completed 90 days of service and
are not covered by another 401(k) plan sponsored by
USAir, except for those individuals not covered by the
United States income tax laws, are eligible to partici-
pate in the Plan. The Plan is subject to the provi-
sions of the Employee Retirement Income Act of 1974
(ERISA).
(b) Plan Contributions
USAir employees electing to participate in the Plan
make contributions to the Plan via payroll deductions.
The amount of contribution that may be made by a par-
ticipant to the Plan shall be a whole percentage of not
less than one percent nor more than 13 percent of a
participant's compensation. Compensation includes base
pay, overtime, bonuses, shift premiums and shift dif-
ferentials, up to the Section 401(a)(17) limit of the
Internal Revenue Code. The statutory limit for pre-tax
contributions was $8,994 for 1993.
The Company will make a matching contribution to the
Plan in an amount equal to 50% of a participants con-
tribution up to a limit of two percent of his/her
compensation.
The Company will also make a profit-sharing contribu-
tion to the Plan on behalf of each participant in an
amount equal to a certain percentage based on the
profit margin of USAir Group, Inc. No profit-sharing
contributions were made during the year ended Decem-
ber 31, 1993.
(c) Vesting
Employer contributions are 100% vested after the par-
ticipant has completed two years of service; all other
contributions are fully vested at all times.
4
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(d) Investment Options
The Company selects the number and type of investment
options available. The investment options are held and
administered as separate, common funds by Fidelity
Investments.
Each participant elects the percentage, in increments
of five percent, in which his/her account balance is
invested in the various investment funds. The partici-
pant may transfer his/her investments from one invest-
ment fund to another investment fund.
A separate account is established and maintained in the
name of each participant and reflects the participant's
contributions invested in, and the earnings and losses
attributed to, each investment fund less certain in-
vestment related administrative expenses. Participants
are allocated a share of each fund's net investment
earnings based upon their account balance as a percent-
age of the total fund balance. Net investment earnings
are allocated to participants.
(e) Loans and Hardship Withdrawals
All participants can borrow against their contributions
to their account but may have only one loan outstanding
at a given point in time. Loans are to be repaid, with
interest, within five years unless the loan is used by
the participant to acquire a principal residence.
Loans are limited to the lesser of $50,000 (reduced by
outstanding loan balances from any other plan main-
tained by the Company) or 50 percent of the partici-
pant's separate account balance as of the date of the
loan.
Upon approval from the Company, a participant may
withdraw his or her contributions from the account if
it is determined that the withdrawal is necessary to
meet an immediate and heavy financial need of the
participant under the deemed hardship standards set
forth in the Code.
(f) Distributions
Distribution to a participant or beneficiary is made as
soon as reasonably practicable after the participant's
separation from service with the Company due to death,
disability, retirement, or other termination of employ-
ment. The normal form of benefit payment is joint and
survivor annuity if married and life annuity if single.
Other options include ten year certain and continuous
and lump sum. If the balance due to the participant or
beneficiary is less than $3,500, a lump sum distribu-
tion is automatic upon separation.
5
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(g) Forfeitures
Forfeitures of terminated participants' non-vested
accounts are applied against future employer contribu-
tions.
(h) Administrative Expenses
Most administrative expenses of the Plan are paid by
USAir, Inc.
(2) Summary of Significant Accounting Policies
(a) Basis of Presentation
The accompanying financial statements have been pre-
pared on an accrual basis and present the net assets
available for plan benefits and changes in those net
assets.
(b) Investments
The assets of the Plan are maintained in a master trust
with the assets of other defined contribution plans
sponsored by USAir. The investment assets of each plan
constitute individual master trust investment accounts.
Form 5500 instructions provide that plan assets held in
this type of arrangement need not be presented as
investments in a master trust. As a result, investment
assets are classified by type of asset in these finan-
cial statements and a master trust filing is not re-
quired. The trustee, Fidelity Management Trust Compa-
ny, maintains the master trust under the terms of an
agreement with the Plan. The Plan's share of assets
and changes in its share of the master trust have been
reported to the Plan by the trustee as having been
determined through the use of fair values of all as-
sets. Fair values for assets were determined by quoted
market values, when available. The Plan presents in
the statement of changes in net assets the net appreci-
ation (depreciation) in the fair value of its invest-
ments which consists of the realized gains or losses
and the unrealized appreciation (depreciation) on those
investments. The Plan's investments in guaranteed
investment contracts (GICs) are stated at contract
value. Purchases and sales of investments are recorded
on a trade-date basis.
[This space intentionally left blank]
6
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<TABLE>
USAIR, INC.
EMPLOYEE SAVINGS PLAN
(3) Investment Activity
The following table presents the cash basis investment
funds' activity, for the year ended December 31, 1993:
<CAPTION>
Fidelity
Retirement Fidelity Fidelity
USAir Government Magellan Intermediate
GIC Money Market Fund Bond Fund
----------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
Balance, December 31, 1992 $ - $ - $ - $ -
---------- ---------- ----------- ----------
Transfer from the USAir
401(k) Savings Plan 6,843,206 7,024,752 22,705,571 4,734,769
Investment income 571,910 241,242 3,863,887 564,695
Net appreciation
(depreciation)
in fair value - - 3,066,271 164,545
Interest income on
participant loans 12,073 11,122 57,748 11,747
Contributions 3,688,198 4,337,771 17,284,348 4,768,132
Net exchanges between
investment funds (64,410) (943,327) 1,242,744 (333,876)
Administrative expenses (4,744) (219) (5,785) (190)
Benefits paid to participants (99,887) (212,469) (399,572) (96,416)
Transfers from other plans 1,714 14 15,699 715
Loan activity (219,576) (212,150) (611,264) (121,860)
---------- ---------- ----------- ----------
Net change in investment
funds 10,728,484 10,246,736 47,219,647 9,692,261
---------- ---------- ----------- ----------
Balance, December 31, 1993 $10,728,484 1) $10,246,736 1) $ 47,219,647 1) $ 9,692,261 1)
========== ========== =========== ==========
<CAPTION>
Fidelity Fidelity U.S. USAir
Equity Equity Index Common
Income Fund Fund Stock Fund Total
----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Balance, December 31, 1992 $ - $ - $ - $ -
----------- ----------- ---------- -----------
Transfer from the USAir
401(k) Savings Plan 10,001,963 3,299,537 788,365 55,398,163
Investment income 611,886 222,820 - 6,076,440
Net appreciation
(depreciation)
in fair value 2,067,995 252,972 (162,090) 5,389,693
Interest income on
participant loans 20,745 9,232 3,402 126,069
Contributions 6,744,937 3,665,648 648,330 41,137,364
Net exchanges between
investment funds 317,103 (378,289) 160,055 -
Administrative expenses (301) (17) (906) (12,162)
Benefits paid to participants (174,873) (41,911) (8,711) (1,033,839)
Transfers from other plans 1,658 19 29 19,848
Loan activity (167,040) (74,586) (24,190) (1,430,666)
---------- ---------- ---------- -----------
Net change in investment
funds 19,424,073 6,955,425 1,404,284 105,670,910
---------- ---------- ---------- -----------
Balance, December 31, 1993 $19,424,073 1)$ 6,955,425 1) $ 1,404,284 $105,670,910
========== ========== ========== ===========
1) Investment fund balance represents greater than five percent
of net assets available for plan benefits.
</TABLE>
7
<PAGE>
(4) Concentration of Credit Risk
The Plan's assets include certain investments in GICs. The
issuers of the GICs are all insurance companies. The Plan's
ultimate realization of amounts invested in GICs is depen-
dent on the continued financial stability of the insurance
companies that are issuers of the GICs. The Plan's benefi-
cial interest in amounts invested in GICs is $10,728,484 at
December 31, 1993.
(5) Transfer from the 401(k) Plan
The Company also sponsors the USAir, Inc. 401(k) Savings
Plan (the 401(k) Plan). Prior to 1993, all employees were
eligible to participate in the 401(k) Plan. Effective
January 1, 1993, the balances of all non-contract and cer-
tain union employees previously participating in the 401(k)
Plan were transferred into the Plan, including loans receiv-
able.
(6) Federal Tax Status
Although the Plan has not requested a letter of determina-
tion from the Internal Revenue Service as to its qualifica-
tion, the Company and its general counsel believe the Plan
meets the requirement of Section 401(a) of the Code and is
therefore believed to be exempt from federal income taxes.
(7) Plan Termination
The Company reserves the right to terminate the Plan at any
time. Upon termination of the Plan, the following actions
shall be taken for the benefit of participants:
(a) As of the termination date, each investment fund shall
be valued. In determining the net worth of the invest-
ment funds there shall be included as a liability such
amounts as shall be necessary to pay all expenses in
connection with the termination of the investment funds
and the liquidation and distribution of the property of
the funds, as well as other expenses, whether or not
accrued, and shall include as an asset all accrued
income.
(b) All participant accounts shall then be disposed of, to,
or for each participant in single lump-sum payments.
8
<PAGE>
(8) Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available
for plan benefits per the financial statements to the Form
5500:
<TABLE>
<CAPTION>
December 31, 1993
-----------------
<S> <C>
Net assets available for plan benefits
per the financial statements $108,290,884
Amounts allocated to withdrawing
participants (28,256)
-----------
Net assets available for benefits
per the Form 5500 $108,262,628
===========
</TABLE>
The following is a reconciliation of benefits paid to par-
ticipants per the financial statements to the Form 5500:
<TABLE>
<CAPTION>
Year ended
December 31, 1993
-----------------
<S> <C>
Benefits paid to participants per the
financial statements $ 1,033,839
Add: Amounts allocated to withdrawing
participants at December 31, 1993 28,256
Less: Amounts allocated to withdrawing
participants at December 31, 1992 -
-----------
Benefits paid to participants per the
Form 5500 $ 1,062,095
===========
</TABLE>
Amounts allocated to withdrawing participants are recorded
on the Form 5500 for benefit claims that have been processed
and approved for payment prior to December 31 but not yet
paid as of that date.
9
<PAGE>
<TABLE>
USAIR, INC. Schedule I
EMPLOYEE SAVINGS PLAN
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1993
<CAPTION>
Description
Identity of Issue of Investment Cost Current Value
- - ------------------ --------------------- ----------- -------------
<S> <C> <C> <C>
USAir Guaranteed Guaranteed investment $ 10,728,484 $ 10,728,484
Investment Fund contract, interest rates
range from 3.25 percent
to 8.80 percent per annum
Fidelity Retirement Money market fund 10,246,736 10,246,736
Government Money
Market Fund
Fidelity Magellan Shares in registered 44,085,831 47,219,647
Fund investment companies
Fidelity Intermediate Shares in registered 9,464,072 9,692,261
Bond Fund investment companies
Fidelity Equity Shares in registered 16,414,317 19,424,073
Income Fund investment companies
Fidelity U.S. Equity Shares in registered 6,358,477 6,955,425
Index Fund investment companies
USAir Common Stock Employer securities 1,696,139 1,404,284
Fund
Participant loans Interest rates range - 2,610,488
from seven percent to
10.5 percent per annum
----------- -----------
Total investments $ 98,994,056 $108,281,398
=========== ===========
10
</TABLE>
<PAGE>
<TABLE>
Schedule II
USAIR, INC.
EMPLOYEE SAVINGS PLAN
Item 27d - Schedule of Reportable Transactions
Year ended December 31, 1993
Aggregate transactions during the year ended December 31, 1993, with securities
of the same issue, accounting for five percent of the value of plan assets at
the beginning of the year were as follows:
<CAPTION>
Number Number
Total of of Realized
Purchases Purchases Total Sales Sales Gain
--------- --------- ----------- ------ ---------
<S> <C> <C> <C> <C> <C>
USAir Guaranteed
Investment Fund $ 4,907,451 149 $ 1,022,173 79 $ -
Fidelity Retirement
Government Money
Market Fund 6,372,872 250 3,150,888 239 -
Fidelity Magellan Fund 24,766,326 252 3,318,520 205 228,633
Fidelity Intermediate
Bond Fund 5,909,600 237 1,116,653 202 37,756
Fidelity Equity Income
Fund 8,770,712 242 1,416,598 192 174,181
Fidelity U.S. Equity
Index Fund 4,188,463 224 785,547 190 71,321
USAir Common Stock Fund 2,387,597 221 1,609,588 161 98,876
11
</TABLE>
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the trustees (or other persons who administer the
employee benefit plan) have duly caused this annual report to be
signed on their behalf by the undersigned thereunto duly autho-
rized.
USAir, Inc. Employee Savings Plan
By: /s/ Ann Greer-Rector
_____________________________
Ann Greer-Rector
Vice President and Controller
of USAir Group, Inc. and
USAir, Inc.
June 29, 1994
<PAGE>
Exhibit 23
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
USAir Group, Inc.
We consent to the use of our report dated June 3, 1994, on the
statement of net assets available for plan benefits as of Decem-
ber 31, 1993, and the related statement of changes in net assets
available for plan benefits for the year ended December 31, 1993
for the USAir, Inc. Employee Savings Plan (the "Plan") included in
the Annual Report on Form 11-K relating to the Plan filed by USAir
Group, Inc. for the year ended December 31, 1993 and to the
incorporation by reference of such report in the Registration
Statement, as amended, on Form S-8 pertaining to the Plan (File No.
33-44835).
/s/ KPMG Peat Marwick
KPMG Peat Marwick
Washington, D. C.
June 29, 1994
