Document:

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                                                                    EXHIBIT 10.7

                                                                  EXECUTION COPY

                         PRENTICE CAPITAL MANAGEMENT, LP
      Terms for Treatment of Trade Indebtedness Of Whitehall Jewelers, Inc.

This term sheet (the "Term Sheet") is intended to be and constitutes a legally
binding commitment or agreement of Whitehall Jewelers, Inc. (the "Company"),
Prentice Capital Management, LP, and the trade vendors signatory hereto in
connection with the treatment by the Company of its indebtedness to suppliers of
inventory in the event of consummation of the Investor's proposed investment in
the Company (the "Investment").

COMPANY:                        Whitehall Jewelers, Inc.

INVESTOR:                       Funds and accounts managed directly or
                                indirectly by, and other investors approved by,
                                Prentice Capital Management, LP.

SUPPLIERS:                      All suppliers of inventory to the Company.

PAYMENT TERMS:                  The Company's indebtedness to each Supplier, in
                                each case as of September 23, 2005 (the "Trade
                                Debt"), shall be satisfied as follows:

                                -     Twenty-five (25%) of the Trade Debt due
                                      and owing each Supplier shall be paid in
                                      cash, and a Note shall be issued to the
                                      Collateral Trustee (as defined below) for
                                      the benefit of the Suppliers upon the
                                      first funding of the Investment, which
                                      payment and Note shall be released from
                                      the Escrow Account (defined below) upon
                                      delivery to the Company of 50% in the
                                      aggregate of the asset merchandise to be
                                      delivered to the Company in October 2005
                                      (the "First Payment");

                                -     Twelve and one-half percent (12.5%) of the
                                      Trade Debt due and owing each Supplier
                                      shall be paid in cash to such Supplier on
                                      or about December 23, 2005;

                                -     Twelve and one-half percent (12.5%) of the
                                      Trade Debt due and owing each Supplier
                                      shall be paid in cash to such Supplier on
                                      or about January 16, 2006; and

                                -     Fifty percent (50%) of the Trade Debt due
                                      and owing each Supplier shall be paid in
                                      cash to such Supplier on or about
                                      September 30, 2007.

                                Upon consummation and funding of the Investment,
                                the Company shall deposit with the Collateral
                                Trustee (the "Escrow Account") that portion of
                                the proceeds of the Investment sufficient to pay
                                the cash component of the First Payment. If any
                                Supplier delivers either (i) the asset
                                merchandise scheduled to be delivered by such
                                Supplier to the Company in October 2005, or (ii)
                                the memo/consignment goods scheduled to be
                                delivered by such Supplier to the Company in
                                October 2005, such Supplier shall receive its
                                pro rata share of the cash component of the
                                First Payment from the Escrow Account,
                                regardless of whether or not 50% in the
                                aggregate of the asset merchandise scheduled to
                                be delivered to the Company in October 2005 has
                                been so delivered. The Escrow Account shall be
                                an interest bearing account, with all accrued
                                interest payable to the Company.

                                Upon the Company's completion of all of the
                                foregoing payments, (i) the Trade Debt of each
                                Supplier shall be deemed satisfied in full, and
                                (ii) each Supplier shall forgive any and all
                                other debts due or owing to them by the Company,
                                including any and all amounts in excess of such
                                Supplier's

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                                  CONFIDENTIAL

                                Trade Debt that could have or should have been
                                invoiced to the Company prior to or on September
                                23, 2005.

NOTE PRIORITY AND SECURITY:     Each Note shall be secured by a perfected lien
                                on and security interest in those assets and
                                property in and on which the Company has granted
                                security interests and liens to the Investor.
                                Such lien and security interest will be
                                subordinate in all respects to the liens and
                                security interests of the Company's existing
                                senior secured lenders and the Investor.

NOTE MATURITY:                  Each Note shall mature on September 30, 2007
                                (the "Maturity Date"), with the principal
                                balance of the Note payable on the Maturity
                                Date.

INTEREST:                       Starting on January 17, 2006, each Note shall
                                accrue interest at the rate of six percent (6%)
                                per annum, payable on the Maturity Date.

MEMO GOODS:                     September 23, 2005 through January 15, 2006: One
                                week reporting and one day pay (by wire).

                                After January 15, 2006: One week reporting and
                                15-day payment (by wire).

                                On or about December 1, 2005, the Company shall
                                cause to be issued a standby letter of credit
                                (the "Letter of Credit") naming the Collateral
                                Trustee as beneficiary for the benefit of the
                                Suppliers, to be drawn upon only in the event
                                the Company fails to timely make required
                                payments for memo goods. The face amount of the
                                Letter of Credit shall be:

                                -     $7 million from December 1, 2005 through
                                      December 18, 2005;

                                -     $10 million from December 19, 2005 until
                                      the date of payment for all sales through
                                      December 26, 2005 (expected to be December
                                      27, 2005);

                                -     $5 million from the day (expected to be
                                      December 27, 2005) following the date of
                                      payment for all sales through December 26,
                                      2005 through January 15, 2006.

                                -     The letter of credit shall terminate on
                                      January 15, 2006.

                                The Company, each of the senior secured lenders
                                and the Investor will recognize the valid and
                                perfected consignment/purchase money security
                                interests of the Suppliers in current and future
                                memo goods without regard to technical
                                perfection; provided, however, that each of the
                                Suppliers acknowledges that its respective
                                consignment/purchase money security interests in
                                the memo goods relate solely to such goods and
                                terminate once such goods are sold. Each of the
                                Suppliers will agree not to challenge the valid
                                and perfected security interests of the Investor
                                or the senior secured lenders in the Company's
                                assets. Each of the Suppliers will disclaim any
                                interest in the collateral of the senior secured
                                lenders, other than those security interests
                                provided for herein with respect to the Note.

                                All consigned/memo goods shall, in the event of
                                a store closing sale, remain in place and be
                                liquidated along with all other inventory. Each
                                Supplier will be paid for the consigned/memo
                                goods in the amount that would be owed by the
                                Company, as the proceeds of the liquidation sale
                                are received.

                                       2
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                                  CONFIDENTIAL

COMMERCIALLY REASONABLE         Each Supplier shall use its commercially
EFFORTS:                        reasonable efforts to satisfy all shipping
                                deadlines set forth in the Company's outstanding
                                purchase orders, as amended and agreed to by the
                                Company and the respective Supplier, and in all
                                purchase orders placed on or after September 26,
                                2005, which are hereafter accepted by the
                                respective Supplier, in its discretion.

PAYMENT TERMS FOR               60-days for goods delivered between September
ASSET GOODS:                    26, 2005 and December 15, 2005

                                90-days for goods delivered after December 15,
                                2005.

REPORTING:                      Financial reporting by the Company to the
                                Collateral Trustee for the benefit of the
                                Suppliers in form and substance to be agreed
                                upon by the parties.

COLLATERAL TRUSTEE:             A trustee shall be appointed as the
                                representative of the Suppliers for purposes of
                                implementation of the transactions contemplated
                                by this Term Sheet, including, among others,
                                maintaining the Escrow Account, serving as
                                beneficiary of the Letter of Credit, receiving
                                financial reporting from the Company
                                implementation of the transactions contemplated
                                by this Term Sheet. The reasonable expenses of
                                the Collateral Trustee shall be paid by the
                                Company.

CONVERTIBLE NOTES INTEREST:     Interest on convertible notes issued to Investor
                                to accrue for a period of not less than 12
                                months from date of issuance, after which,
                                interest to continue to accrue or be paid at any
                                time at Investor's option.

SENIOR BANK FACILITIES          Only covenant in senior bank facilities to be
                                minimum excess availability covenant.

OTHER MATTERS:

REPRESENTATIONS, WARRANTIES,    The definitive documentation shall contain
AND COVENANTS:                  representations, warranties, and covenants
                                customary for a transaction of this nature,
                                including default/acceleration provisions based
                                on, inter alia, (i) payment defaults, (ii)
                                failure to post the Letter of Credit, (iii) a
                                provision that a default under the Company's
                                credit agreements with the secured lenders and
                                the Investor shall cause a default under this
                                Term Sheet, and (iv) a provision that remedies
                                for a default under this Term Sheet shall be
                                limited to those contained in an inter-creditor
                                agreement to be entered into by the parties.

CONDITIONS PRECEDENT TO         -     Execution and delivery by Suppliers
PAYMENT OF SETTLEMENT AMOUNT          holding not less than 90%, or such lesser
AND AGREEMENT OF THE SUPPLIERS:       percentage as agreed to in writing by the
                                      Investor, of the Company's total Trade
                                      Debt of appropriate definitive
                                      documentation, including, but not limited
                                      to, an extension agreement and related
                                      acceptance form, in form and substance
                                      satisfactory to the Investor and including
                                      customary closing conditions, and the
                                      satisfaction of all such conditions.

                                -     Consummation of the Investment.

                                -     No law or injunction or other legal
                                      restraint existing that prevents
                                      consummation of payment of the Settlement
                                      Amount or entry into the other
                                      transactions contemplated hereby.

                                -     The aggregate of all payables due to
                                      Suppliers as of September 23,

                                       3
<PAGE>

                                  CONFIDENTIAL

                                      2005 shall have been confirmed to the
                                      satisfaction of the Company and the
                                      Investor.

                                -     Satisfaction of additional customary
                                      closing conditions.

ALTERNATE TRANSACTIONS:         This transaction has been negotiated by the
                                Company, the Investor and the Suppliers. The
                                Suppliers reserve the right not to enter into
                                the same transaction or any other transaction
                                with any other investor, except in their sole
                                and absolute discretion.

CONFIDENTIALITY:                All parties agree to keep this proposal and all
                                conversations and exchanged information related
                                thereto strictly confidential, with the
                                exception of any disclosure required for
                                purposes of compliance with applicable law.
                                Notwithstanding the foregoing, any Supplier may
                                discuss the terms of this proposal with another
                                Supplier, but no Supplier shall, without the
                                prior written consent of the Company and the
                                Investor, disclose the existence or terms of
                                this proposal to any party other than a
                                Supplier.

BINDING EFFECT                  The signature below of an authorized
                                representative of a Supplier shall constitute an
                                acceptance by such Supplier (each, a
                                "Participating Supplier") of the terms set forth
                                in this Term Sheet. This Term Sheet shall bind
                                and benefit each of the Company, the Investor
                                and the Participating Suppliers and their
                                respective successors, assigns, executors,
                                administrators, and successors in interest;
                                provided, however, that Suppliers that have not
                                expressly accepted the terms herein by execution
                                of this Term Sheet, shall have no right to
                                enforce such terms against the Company or the
                                Investor.

Superseded by Definitive Documents: This agreement shall have no effect upon the
execution of definitive agreements regarding the subject matter hereof.

Counterparts: This Term Sheet may be signed in two or more original or
facsimiled counterparts, any one of which need not contain the signature of more
than one party, but all such counterparts taken together will constitute one and
the same agreement. The rights under this Term Sheet may not be assigned.

Amendments: This agreement may only be amended through a written instrument
executed by all of the parties hereto.

Whitehall Jewelers, INC.              Prentice Capital Management, LP

By: /s/ John Desjardins               By: /s/ Jonathan Duskin
                                          ---------------------------------

Name: John Desjardins                 Name:  Jonathan Duskin

Title: Executive VP and CFO           Title:  Managing Director

Address for Notices:                  Address for Notices:

155 North Wacker Drive, 5th Floor     623 Fifth Avenue, 32nd Floor
Chicago, Illinois  60606              New York, New York  10022

                                       4
<PAGE>

                                  CONFIDENTIAL

ACKNOWLEDGED AND AGREED, WITH RESPECT TO "MEMO GOODS" AND "SENIOR BANK
FACILITIES":

lasalle national bank, as Agent

By: /s/ Robert Barnhand
    -------------------

Name: Robert Barnhand

Title: Senior Vice President, Group Head

Address for Notices:
______________________
______________________
______________________

                                       5
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
S.H.R. Ltd.

By: /s/ Michael Shaffet

Name: Michael Shaffet

Title: Treasurer

Address for Notices:
One Rockefeller Plaza
New York, NY 10020

ACCEPTED AND AGREED TO:
Clover Corporation

By: /s/ Michael Shaffet

Name: Michael Shaffet

Title: Treasurer

Address for Notices:
One Rockefeller Plaza
New York, NY 10020

ACCEPTED AND AGREED TO:
[                     ]

By: /s/ David Gaynes

Name: David Gaynes

Title: President

Address for Notices:
154 W. 14th Street, 12th Floor
New York, NY 10011

ACCEPTED AND AGREED TO:
Paras Diamond Corporation d/b/a Amikam

By: /s/ Ravi Gopalan

Name: Ravi Gopalan

Title: Vice President

Address for Notices:
592 Fifth Ave., 3rd Floor
New York, NY 10036

                                       6
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
Aurafin LLC

By: /s/ Steven L. Hansen

Name: Steven L. Hansen

Title: CFO

Address for Notices:
6701 Nob Hill Road
Tamarac, FL  33076

ACCEPTED AND AGREED TO:
Rharat Diamond Corp

By: /s/ Shreyas R. Mehta

Name: Shreyas R. Mehta

Title: President

Address for Notices:
Rharat Diamond Corp
50 Main Street #1260
White Plains, NY 10606

ACCEPTED AND AGREED TO:
Basic Programs
Paul Winston - Eurostar

By: /s/ Isaac Gold

Name: Isaac Gold

Title: President

Address for Notices:
151 West 46th St. 11th Floor
New York, NY 10036

ACCEPTED AND AGREED TO:
B&M Imports, Inc.

By: /s/ Mois Medine

Name: Mois Medine

Title: President

Address for Notices:
12 East 46th Street
4th Floor
New York, NY 10017

                                       7
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
Color Craft

By: /s/ Todd Wolleman

Name: Todd Wolleman

Title: President

Address for Notices:
45 West 45th Street
New York, NY  10036

ACCEPTED AND AGREED TO:
Combine International, Inc.

By: /s/ Shrikant Mehta

Name: Shrikant Mehta

Title: President/CEO

Address for Notices:
Combine International, Inc.
354 Indusco Court
Troy, MI 48083
Attn: Roger Parsons

ACCEPTED AND AGREED TO:
Continental Jewellery (Mfg) Ltd.

By: /s/ Charles Chan

Name: Charles Chan

Title: Managing Director

Address for Notices:
Flat M, 1/F. Kaiser Estate
Phase 3, li Hok Yuen Street
Hunghom, Kowloon
Hong Kong

ACCEPTED AND AGREED TO:
Diaco International

By: /s/ Eli Hollander

Name: Eli Hollander

Title: Controller

Address for Notices:
Diaco International
1271 Avenue of the Americas, 47th Floor
New York, NY 10020

                                       8
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
Epoque Jewelry Inc.

By: /s/ John Wong

Name: John Wong

Title: Vice President

Address for Notices:
207 Canal Street
New York, NY 10013

ACCEPTED AND AGREED TO:
Eyalrd Corp.

By: /s/ Albert Kallati

Name: Albert Kallati

Title: President

Address for Notices:

ACCEPTED AND AGREED TO:
M. Fabrikant & Sons

By: /s/ Michael Shaffet

Name: Michael Shaffet

Title: Treasurer

Address for Notices:
One Rockefeller Plaza
New York, NY 10020

ACCEPTED AND AGREED TO:
Fabrikant - Leer International Ltd. /f/k/a Leer Gem Ltd.

By: /s/ Michael Shaffet

Name: Michael Shaffet

Title: Treasurer

Address for Notices:
One Rockefeller Plaza
New York, NY 10020

                                       9
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
Fine Facet Diamonds, Inc.

By: /s/ Jhaveri Abjiay F.

Name: Jhaveri Abjiay F.

Title: President

Address for Notices:
Fine Facet Diamonds, Inc.
15 W. 47th Street, 10th Floor, #1005
New York, NY  10036

ACCEPTED AND AGREED TO:
Frederick Goldman Inc.

By: /s/ Richard Goldman

Name: Richard Goldman

Title: President

Address for Notices:
154 West 14th Street
New York, New York  10011

ACCEPTED AND AGREED TO:
Nathan Hennick & Co. Ltd.

By: /s/ Brian Hennick

Name: Brian Hennick

Title: Vice -President

Address for Notices:
Nathan Hennick & Co. Ltd.
6 Tippett Road
Toronto Ontario M3H2V2

ACCEPTED AND AGREED TO:
Jewelex New York, Ltd.

By: /s/ Nandini Doshi (Rupa)

Name: Nandini Doshi (Rupa)

Title: CFO

Address for Notices:
22 West 48th St.
New York, NY  10036

                                       10
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
JC Trading, Inc.

By: /s/Simon Jeckell

Name: Simon Jeckell

Title: Vice President

Address for Notices:
JC Trading, Inc.
1001 West Newport Center, Suite 111
Deerfield Beach, FL  33442

ACCEPTED AND AGREED TO:
Simon Korn Inc.

By: /s/ David Bader

Name: David Bader

Title: President

Address for Notices:
580 5th Ave. #612
New York, NY  10036

ACCEPTED AND AGREED TO:
Legend Jewelry Co. Ltd. (Macao Commercial Offshore)

By: /s/ Patrick Luk

Name: Patrick Luk

Title: Managing Director

Address for Notices:
Legend Jewelry Co. Ltd (Macao Commercial Offshore)
Avenida Xian Xing Hai, S/N Edf.
Zhu Kuan C.C., 13 Andar K. NAPE Macau

ACCEPTED AND AGREED TO:
Lorenzo Jewelry Inc.

By: /s/ Daryl Shamitoff

Name: Daryl Shamitoff

Title: President

Address for Notices:
5506 6th Ave. S
Seattle, WA 98108

                                       11
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
Merit Diamond Corporation

By: /s/ Henry M. Dubron

Name: Henry M. Dubron

Title: CFO

Address for Notices:
33 West 46th St.
New York, NY  10036

ACCEPTED AND AGREED TO:
Rosy Blue, Inc.

By: /s/ Nirau Dalal

Name: Nirau Dalal

Title: Controller

Address for Notices:
529 Fifth Avenue
New York, NY 10017
Attn: Nirav Dalal

with a copy to:
Laurence L. Ginsburg, Esq.
Moses & Singer LLP
The Chrysler Building

ACCEPTED AND AGREED TO:
Sandberg & Sikorski Corp.

By: /s/ Samuel Sandberg

Name: Samuel Sandberg

Title: Secretary & Treasurer

Address for Notices:
37 West 26th Street
New York, NY 10010

                                       12
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
Leo Schachter Diamonds, LLC

By: /s/ Eric Austein

Name: Eric Austein

Title: Partner

Address for Notices:
579 5th Ave.
New York, NY  10017

ACCEPTED AND AGREED TO:
SDC Designs

By: /s/ Abhay Javeri

Name: Abhay Javeri

Title: President

Address for Notices:
6 East 45th St., Suite #901
New York, NY 10017

ACCEPTED AND AGREED TO:
STS Jewels Inc.

By: /s/ Paramjeet Bhaha

Name: Paramjeet Bhaha

Title: Chief Operating Officer

Address for Notices:
30-00 LIC Center - I
5th Floor
Long Island City, NY 11101

ACCEPTED AND AGREED TO:
Suberi Bros. LLC

By: /s/ Maniu Markman

Name: Maniu Markman

Title: Chairman & CEO

Address for Notices:
902 Broadway
New York, NY 10010

                                       13
<PAGE>

                                  CONFIDENTIAL

ACCEPTED AND AGREED TO:
Sumit Diamond Corp.

By: /s/ Kumar Javeri

Name: Kumar Javeri

Title: President

Address for Notices:
592 5th Ave.
New York, NY  10036

ACCEPTED AND AGREED TO:
Thien Po Jewelry Ltd.

By: /s/ Kenneth Lo

Name: Kenneth Lo

Title: Managing Director

Address for Notices:
47/27 M004, Sukhaphban 2 Road
Dokmar, Pravet
Bangkok 10250, Thailand

                                       14<PAGE>
                                                                    EXHIBIT 10.1

                               INDEMNITY AGREEMENT

     This Indemnity Agreement (this "Agreement") is made as of the ____ day of
________, 2005 by and between US Airways Group, Inc., a Delaware corporation
(the "Corporation") and __________ ("Indemnitee").

                                   WITNESSETH:

     WHEREAS, it is essential to the Corporation to retain and attract as
Directors and Officers the most capable persons available; and

     WHEREAS, both the Corporation and the Indemnitee recognize the increased
risk of litigation and other claims being asserted against Directors and
Officers of public companies in today's environment; and

     WHEREAS, the substantial increase in corporate litigation subjects
Directors and Officers to expensive litigation risks at the same time that the
availability of Directors' and Officers' liability insurance has been severely
limited; and

     WHEREAS, it is now and has always been the express policy of the
Corporation to indemnify its Directors and Officers so as to provide them with
the maximum possible protection permitted by law; and

     WHEREAS, Indemnitee does not regard the protection available under the
Corporation's Amended and Restated Certificate of Incorporation and Bylaws and
insurance as adequate in the present circumstances, and may not be willing to
serve as a Director or an Officer without adequate protection; and

     WHEREAS, the Board of Directors of the Corporation has determined that the
inability to attract and retain the Indemnitee would be detrimental to the best
interests of the Corporation and to its stockholders and the Corporation should
act to assure such persons that there will be increased certainty of such
protection in the future; and

     NOW, THEREFORE, in consideration of the Indemnitee's continued services as
a Director or an Officer of the Corporation, the Corporation and Indemnitee do
hereby agree as follows:

1.   AGREEMENT TO SERVE. Indemnitee agrees to serve or continue to serve as a
     Director or an Officer of the Corporation for so long as he or she is duly
     elected or appointed or until such time as he or she tenders his or her
     resignation in writing.

2.   DEFINITIONS. As used in this Agreement:

          (a) References to the "Corporation" shall include US Airways Group,
     Inc., any parent, subsidiary or affiliate of US Airways Group, Inc., and
     any constituent corporation (including any constituent of a constituent)
     absorbed in a consolidation or

<PAGE>

     merger which, if its separate existence had continued, would have had power
     and authority to indemnify its directors, officers, employees, agents or
     fiduciaries, so that if Indemnitee is or was a director, officer, employee,
     agent or fiduciary of such constituent corporation, or is or was serving at
     the request of such constituent corporation as a director, officer,
     employee, agent or fiduciary of another corporation, partnership, joint
     venture, employee benefit plan, trust or other enterprise, Indemnitee shall
     stand in the same position under the provisions of this Agreement with
     respect to the resulting or surviving corporation as Indemnitee would have
     with respect to such constituent corporation if its separate existence had
     continued.

          (b) The term "Proceeding" shall include any threatened, pending or
     completed action, suit, arbitration, alternative dispute resolution
     mechanism, investigation, administrative hearing or proceeding, whether
     brought against, by or in the right of the Corporation or otherwise, and
     whether of a civil, criminal, administrative or investigative nature, in
     which Indemnitee is, was or becomes a party, witness or participant or is
     threatened to be made a party, witness or participant by reason of the fact
     that Indemnitee is or was a Director and/or Officer of the Corporation, or
     is or was serving at the written request of the Corporation as a director,
     officer, employee, agent or fiduciary of another corporation, partnership,
     joint venture, trust or other enterprise. A "Proceeding" shall include
     Proceedings with respect to which the event or events that form the subject
     matter of the Proceeding occurred prior to the date of this Agreement, so
     long as the Indemnitee was at that time a Director and/or Officer of the
     Corporation or serving at the request of the Corporation as set forth in
     the previous sentence.

          (c) The term "Expenses" shall include, without limitation, expenses of
     investigations, judicial or administrative proceedings or appeals, amounts
     paid in settlement by or on behalf of Indemnitee, attorneys' fees,
     retainers, court costs, transcript costs, fees of experts, witness fees,
     travel expenses, duplicating costs, printing and binding costs, telephone
     charges, postage, delivery service fees and all other disbursements, costs,
     expenses and obligations paid or incurred in connection with investigating,
     prosecuting, defending, being a witness in, or participating in (including
     an appeal), or preparing to prosecute, defend, be a witness in, any
     Proceeding or in connection with establishing a right to indemnification
     under Paragraph 7 of this Agreement, but shall not include amounts of
     judgments, fines or penalties against Indemnitee.

          (d) References to "other enterprises" shall include employee benefit
     plans; references to "fines" shall include any excise taxes assessed on
     Indemnitee with respect to any employee benefit plan; references to
     "serving at the request of the Corporation" shall include any service as a
     Director, Officer, employee or agent of the Corporation which imposes
     duties on, or involves services by, such Director, Officer, employee or
     agent with respect to an employee benefit plan, its participants or
     beneficiaries; and a person who acted in good faith and in a manner he or
     she reasonably believed to be in the interest of the participants and
     beneficiaries of an employee benefit plan shall be deemed to have acted in
     a manner "not opposed to the best interest of the Corporation" as referred
     to in this Agreement.

                                       -2-

<PAGE>

3.   INDEMNITY IN THIRD PARTY PROCEEDINGS. The Corporation shall indemnify
     Indemnitee in accordance with the provisions of this paragraph, against all
     Expenses, judgments, fines, ERISA excise taxes and penalties and amounts
     paid in settlement (including all interest, assessments, and other charges
     paid or payable in connection with or in respect of such Expenses actually
     and reasonably incurred by or for Indemnitee in connection with any
     Proceeding (other than a Proceeding by or in the right of the Corporation
     to procure a judgment in its favor), or any claim, issue or matter therein,
     but only if Indemnitee acted in good faith and in a manner in which he or
     she reasonably believed to be in or not opposed to the best interests of
     the Corporation, and, in the case of a criminal proceeding had no
     reasonable cause to believe that his or her conduct was unlawful. The
     termination of any such Proceeding by judgment, order, settlement,
     conviction, or upon a plea of nolo contendere or its equivalent, shall not,
     of itself, create a presumption that Indemnitee did not act in good faith
     in a manner which he or she reasonably believed to be in or not opposed to
     the best interests of the Corporation, and, with respect to any criminal
     proceeding, that Indemnitee has reasonable cause to believe that his or her
     conduct was unlawful.

4.   INDEMNITY IN PROCEEDINGS BY OR IN THE RIGHT OF THE CORPORATION. The
     Corporation shall indemnify Indemnitee in accordance with the provisions of
     this paragraph, against all Expenses actually and reasonably incurred by or
     for Indemnitee in connection with any Proceeding by or in the right of the
     Corporation to procure a judgment in its favor, but only if Indemnitee
     acted in good faith and in a manner which he or she reasonably believed to
     be in or not opposed to the best interests of the Corporation, except that
     no indemnification for Expenses shall be made under this paragraph in
     respect of any claim, issue or matter as to which Indemnitee shall have
     been adjudged to be liable to the Corporation, unless and only to the
     extent that the court in which such Proceeding was brought shall determine
     upon application that, despite the adjudication of liability but in view of
     all the circumstances of the case, Indemnitee is fairly and reasonably
     entitled to indemnity for such Expenses which such court shall deem proper.

5.   INDEMNIFICATION OF EXPENSES OF SUCCESSFUL PARTY. Notwithstanding any other
     provision of this Agreement, to the extent that Indemnitee has been
     successful on the merits or otherwise in defense of any Proceeding referred
     to in paragraphs 3 and 4 above, or in defense of any claim, issue or matter
     therein, Indemnitee shall be indemnified against all Expenses actually and
     reasonably incurred by Indemnitee in connection therewith.

6.   ADVANCES OF EXPENSES. At the written request of Indemnitee, the Expenses
     incurred by Indemnitee in any Proceeding shall be paid by the Corporation
     (within two business days of such request) in advance of the final
     disposition of such Proceeding, provided, that Indemnitee shall undertake
     in writing to repay such amount to the extent that it is ultimately
     determined that Indemnitee is not entitled to indemnification; provided
     that the Corporation's obligation to advance Expense under this Section 6
     shall not be qualified or conditioned in any manner by the Corporation on
     the Indemnitee's ability to reimburse the Corporation; and provided,
     further, that if Indemnitee has commenced or thereafter commences legal
     proceedings in a court of competent jurisdiction to secure a determination
     that Indemnitee should be indemnified under applicable law, any
     determination made by such forum that Indemnitee would not be permitted to
     be

                                       -3-

<PAGE>

     indemnified under applicable law shall not be binding and Indemnitee shall
     not be required to reimburse the Company for any advanced Expenses until a
     final judicial determination is made with respect thereto (as to which all
     rights of appeal therefrom have been exhausted or lapsed).

7.   RIGHT OF INDEMNITEE TO INDEMNIFICATION UPON APPLICATION; PROCEDURE UPON
     APPLICATION.

          (a) Any indemnification under Paragraphs 3 and 4 or advance under
     Paragraph 6 (unless ordered by the court) shall be paid by the Corporation
     to the fullest extent permitted by applicable law in effect as of the date
     hereof and to such greater extent as applicable law may thereafter from
     time to time permit, as soon as practicable but in any event no later than
     30 days after receipt of the written request of Indemnitee, unless a
     determination is made within said 30 day period by (1) the Board of
     Directors by a majority of directors who were not parties to the Proceeding
     in respect of which indemnification is being sought event though less than
     a quorum; or (2) by a committee of such directors designated by majority
     vote of such directors, even though less than a quorum; or (3) if there are
     no such directors, or if such directors so elect independent legal counsel
     in a written opinion, that Indemnitee has not met the relevant standards
     for indemnification set forth in Paragraphs 3 and 4.

          (b) In the case of a determination made in accordance with this
     paragraph that Indemnitee is not entitled to whole or partial
     indemnification with respect to a specific Proceeding, or a failure by any
     such forum to make any determination, Indemnitee shall have the right to
     apply to any court of competent jurisdiction for the purpose of enforcing
     Indemnitee's right to indemnification pursuant to this Agreement or to
     commence litigation in any court in the State of Delaware having subject
     matter jurisdiction thereof and in which venue is proper seeking an initial
     determination by the court or challenging any such determination by such
     forum or any aspect thereof, including the legal or factual bases therefor,
     and the Corporation hereby consents to service of process and to appear in
     any such proceeding. The burden of proving that indemnification or advances
     are not appropriate shall be on the Corporation. Neither the failure of the
     Corporation (including its Board of Directors, a committee thereof or
     independent legal counsel) to have made a determination prior to the
     commencement of such action that Indemnitee has met the applicable standard
     of conduct nor an actual determination by the Corporation (including its
     Board of Directors, a committee thereof or independent legal counsel) that
     Indemnitee has not met such standard shall be a defense to the action nor
     create a presumption that Indemnitee has not met the applicable standard of
     conduct. Indemnitee's Expenses actually and reasonably incurred in
     connection with successfully establishing his right to indemnification or
     advance, in whole or in part, shall also be indemnified by the Corporation.

          (c) With respect to any Proceeding for which indemnification is
     requested, the Corporation will be entitled to participate therein at its
     own expense and, except as otherwise provided below, the Corporation may
     assume the defense thereof, with counsel satisfactory to Indemnitee. After
     notice from the Corporation to Indemnitee of its election to assume the
     defense of a Proceeding, the Corporation will not be liable to

                                       -4-

<PAGE>

     Indemnitee under this Agreement for any Expenses subsequently incurred by
     Indemnitee in connection with the defense thereof, other than as provided
     below. The Corporation shall not settle any Proceeding in any manner which
     would impose any penalty or limitation on Indemnitee without Indemnitee's
     written consent. Indemnitee shall have the right to employ counsel in any
     Proceeding but the fees and expenses of such counsel incurred after notice
     from the Corporation of its assumption of the defense of the Proceeding
     shall be at the expense of Indemnitee, unless (i) the employment of counsel
     by Indemnitee has been authorized by the Corporation, (ii) Indemnitee shall
     have reasonably concluded that there may be a conflict of interest between
     the Corporation and Indemnitee in the conduct of the defense of a
     Proceeding, or (iii) the Corporation shall not in fact have employed
     counsel to assume the defense of a Proceeding, in each of which cases the
     fees and expenses of Indemnitee's counsel shall be advanced by the
     Corporation. Notwithstanding the foregoing, the Corporation shall not be
     entitled to assume the defense of any Proceeding brought by or in the right
     of the Corporation.

8.   LIMITATIONS ON INDEMNIFICATION. No payment pursuant to this Agreement shall
     be made by the Corporation:

          (a) To indemnify Indemnitee for any Expenses, judgments, fines or
     penalties sustained in any Proceeding for which payment is actually made to
     Indemnitee (under a valid and collectible insurance policy, by-law,
     contract, agreement or otherwise), except in respect of any excess beyond
     the amount of payment under such insurance;

          (b) To indemnify Indemnitee for any Expenses, judgments, fines or
     penalties sustained in any Proceeding for an accounting of profits made
     from the purchase or sales by Indemnitee of securities of the Corporation
     pursuant to the provisions of Section 16(b) of the Securities Exchange Act
     of 1934, the rules and regulations promulgated thereunder and amendments
     thereto or similar provisions of any federal, state or local statutory law;

          (c) To indemnify Indemnitee for any Expenses, judgments, fines or
     penalties resulting from Indemnitee's conduct which is finally adjudged to
     have been willful misconduct, knowingly fraudulent or deliberately
     dishonest; or

          (d) If a court of competent jurisdiction finally determines that such
     payment hereunder is unlawful.

9.   INDEMNIFICATION HEREUNDER NOT EXCLUSIVE. The indemnification and
     advancement of Expenses provided by this Agreement shall not be deemed
     exclusive of any other rights to which Indemnitee may be entitled under the
     Certificate of Incorporation or the By-Laws of the Corporation, in each
     case as amended or restated, any agreement, any vote of stockholders or
     disinterested Directors, the General Corporation Law of the State of
     Delaware, or otherwise, both as to action in his or her official capacity
     and as to action in another capacity while holding such office. The
     indemnification provided by this Agreement shall continue as to Indemnitee
     even though he or she may have ceased to be a Director or Officer of the
     Corporation and shall inure to the benefit of the heirs and personal
     representatives of Indemnitee.

                                       -5-

<PAGE>

10.  PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of
     this Agreement to indemnification by the Corporation for a portion of the
     Expenses, judgments, fines or penalties actually and reasonably incurred by
     him or her in any Proceeding but not, however, for the total amount
     thereof, the Corporation shall nevertheless indemnify Indemnitee for the
     portion of such Expenses, judgments, fines or penalties to which Indemnitee
     is entitled to the maximum extent permitted by law.

11.  MAINTENANCE OF LIABILITY INSURANCE.

          (a) The Corporation hereby covenants and agrees that, as long as
     Indemnitee continues to serve as a Director and/or Officer of the
     Corporation and thereafter as long as Indemnitee may be subject to any
     Proceeding, the Corporation, subject to subsection (c), shall maintain in
     full force and effect directors' and officers' liability insurance ("D&O
     Insurance") in reasonable amounts from established and reputable insurers.

          (b) In all D&O Insurance policies, Indemnitee shall be named as an
     insured in such a manner as to provide the Indemnitee the same rights and
     benefits as are accorded to the most favorably insured of the Corporation's
     Directors or Officers.

          (c) Notwithstanding the foregoing, but subject to the terms of the
     Agreement and Plan of Merger, dated as of May 19, 2005, as amended, among
     the Corporation, America West Holdings Corporation, and Barbell Acquisition
     Corp., the Corporation shall have no obligation to obtain or maintain the
     D&O Insurance if the Corporation determines in good faith that such
     insurance is not reasonably available, the premium costs for such insurance
     are disproportionate to the amount of coverage provided, the coverage
     provided by such insurance is so limited by exclusions that it provides an
     insufficient benefit, or Indemnitee is covered by similar insurance
     maintained by a subsidiary of the Corporation.

12.  SUBROGATION. In the event of any payment under this Agreement, the
     Corporation shall be subrogated to the extent of such payment to all of the
     rights of recovery of Indemnitee, who shall execute all papers required and
     take all action necessary to secure such rights, including execution of
     such documents as are necessary to enable the Corporation to bring suit to
     enforce such rights.

13.  SAVINGS CLAUSE. If this Agreement or any portion hereof is invalidated on
     any ground by any court of competent jurisdiction, the Corporation shall
     nevertheless indemnify Indemnitee to the extent permitted by any applicable
     portion of this Agreement that has not been invalidated or by any other
     applicable law.

14.  NOTICE. Indemnitee shall, as a condition precedent to his or her right to
     be indemnified under this Agreement, give to the Corporation notice in
     writing as soon as practicable of any proceeding for which indemnity will
     or could be sought under this Agreement. Notice to the Corporation shall be
     directed to US Airways Group, Inc., 111 West Rio Salado Parkway, Tempe,
     Arizona 85281, Attention: General Counsel (or such other address as the
     Corporation shall designate in writing to Indemnitee). Notice shall be
     deemed received three days after the date postmarked if sent by prepaid
     mail, properly

                                       -6-

<PAGE>

     addressed. In addition, Indemnitee shall give the Corporation such
     information and cooperation as it may reasonably require and as shall be
     within Indemnitee's power.

15.  COUNTERPARTS. This Agreement may be executed on any number of counterparts,
     all of which shall be deemed to constitute one and the same instrument.

16.  APPLICABLE LAW. This Agreement shall be governed by, and construed and
     interpreted in accordance with, the law of the State of Delaware.

17.  SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
     Corporation and its successors and assigns.

18.  AMENDMENTS. No amendment, waiver, modification, termination or cancellation
     of this Agreement shall be effective unless in writing signed by both of
     the parties hereto. The indemnification rights afforded to Indemnitee
     hereby are contract rights and may not be diminished, eliminated or
     otherwise affected by amendments to the Amended and Restated Certificate of
     Incorporation or Bylaws of the Corporation or by other agreements.

19.  INTEGRATION AND ENTIRE AGREEMENT. This Agreement sets forth the entire
     understanding between the parties hereto and supersedes and merges all
     previous written and oral agreements between the parties hereto related to
     the subject matter hereof.

                         (Signatures on following page)

                                       -7-

<PAGE>

     IN WITNESS WHEREOF, the parties hereby have caused this Agreement to be
duly executed and signed as of the day and year first above written.

                                        US AIRWAYS GROUP, INC.

                                        By:
                                            ------------------------------------
                                        [Name]
                                               ---------------------------------
                                        [Title]
                                                --------------------------------

                                        INDEMNITEE

                                        ----------------------------------------
                                        [Name]

                                       -8-

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