10-K Usairways Group

Discussion in 'American Airlines' started by usfliboi, Feb 22, 2012.


  1. CallawayGolf

    CallawayGolf Veteran

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    First off, I believe Doug did a one-time sale of stock options around 2006 totaling around $10m. IIRC he had certain options that had expiration dates on them and he had to convert or lose them. Since he was doing the transaction anyway he might have sold quite a few additional options while the price was up and he probably only wanted to pull the trigger once over a ten year period or so.

    As for the rest, they would be required by the SEC to sign a blind trust agreement or a Executive Diversification and Investment Trust where they have no direct control (participation, knowledge, inside information influences) over when their shares are sold or converted. If an executive is granted an RSU at the value of $2.00 on the date of issue and he files the blind trust with his broker stating that he would like to sell if the price reaches $10.00, then he would have no way causing or stopping the transaction if the price spikes up to that amount. As soon as the price point is triggered, the shares will sell. It might happen in six months or it might happen in six years, or it may never happen. So, the only thing you can determine from the stock conversions is that these senior execs filed a blind trust for a certain number of shares at a certain stock price. If you (public traders) could read into those transactions that the execs lacked confidence in the company, then the system would be broken. My guess is that Doug sets his blind trust very high so that he doesn't have to come out every couple of years and explain why he took an additional couple of million that year.

    I don't think you have to worry about firing Kirby. If you were miraculously appointed CEO, he would probably beat you to the punch and clear out his office before you got your employee badge. ;)
     
  2. SparrowHawk

    SparrowHawk Veteran

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    You're assuming he knows I exist? Hmm that pauses I? Wonders who Callaway Golf really is?
     
  3. CallawayGolf

    CallawayGolf Veteran

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    Well I haven't been to 111 W. Rio Salado in a couple of years now and never spent a whole lot of time on the 9th floor if that's what you are asking.
     
  4. exramper

    exramper Member

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    Sparowhawk, looks like you really upset MRS Parker now..... :D Yes Parker may be the money wizard, but just think how great this airline would be if he wasn't so intent on hating the employees so much....Another thing...is Parker really in charge of this company or is he just Robert Isom's puppet..ever notice when someone asks him a question he usually doesn't know the answer and has to ask Robert...hmmm.
     
  5. BoeingBoy

    BoeingBoy Veteran

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    Nope, the earliest mergers were about consolidation. All you do is pick a period where HP was the among the first to merge. Make it this century and Doug is not the first - AA/TWA, AF/KLM. Even ATA, which Parker tried unsuccessfully to buy, was picked up by WN. Parker's "innovation" was attempting to merge with the other airline was in bankruptcy, which is nothing more than his "do it on the cheap" way of doing business - be it employees, mergers, airplanes, whatever. How often has he said US has had problems finding replacement 757's "at the right price" (lower than others will pay). How often has he said that US can't pay employees what the other carriers can.

    Jim
     
  6. 700UW

    700UW Corn Field

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    ATA was not picked up by WN, they went out of business in bankruptcy.

    On April 2, 2008, ATA filed for Chapter 11 bankruptcy protection. ATA then announced it was ceasing all services, effective 4:00 AM EDT, Thursday April 3, 2008 citing the unexpected loss of a major contract for its military charter business, as a subcontractor of FedEx Express, along with recent increases in jet fuel prices. Red-eye flights in the air at the time of the announcement proceeded to their destinations. Flight 4586 from Honolulu to Phoenix was the last ATA flight, departing almost 2 hours late at 12:10am (HST) arriving April 3, 2008 at 8:48am (MST).

     
  7. BoeingBoy

    BoeingBoy Veteran

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    Your quote contradicts your statement, 700. You should at least get your story straight before telling someone they're wrong. Did WN acquire the assets of ATA? Yes. Was ATA in bankruptcy at the time? Yes, I didn't say they weren't. All I said was that WN acquired ATA, which is what happened.

    Jim
     
  8. 700UW

    700UW Corn Field

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    Did they buy planes?

    Did they merge?

    Is WN flying ATA's routes with their equipment and employees?

    Nope ATA went out of business and WN picked up what was left after everything was gone.
     
  9. CallawayGolf

    CallawayGolf Veteran

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    You are the industry and historical expert so I will defer to you on those matters. However, as far a picking a period, I was selecting a time period when Doug was CEO and was in a position to pursue a merger. The fact that he was in that position for ten days prior to 9/11 also seems significant since that changed a lot of factors in the industry in regards to profitability and solvency concerns for most of the majors.

    I don't archive articles, but I do remember reading some national news stories back in 2005 which were quoting industry sources (something like the Boyd Group, but I could be wrong) that went into great detail about how Doug was the only airline executive that was championing consolidation. I also remember quotes from Franke about how Doug talked about the need for consolidation in his interview to come to AWA and how Franke viewed Doug as having remarkable insight into what the industry needed to do to gain long-term profitability and sustainability. This was all couched in the concept that Doug was not at all like other CEOs and he had a strong resolve to reduce seats and gain pricing power that seemed absent from his peers at the time. Now the article(s) may have just been a PR piece, but I do recall reading those things back then.

    Again, if I recall correctly, one of the big objections to the US/DL takeover was that there was too much overlap in the routes for certain people's comfort. Overlap means consolidation options and pricing power. Now compare that to the limited overlap at DL/NW or UA/CO and tell me again how all CEOs strive for consolidation rather than expanded marketshare. If you are focused on consolidation you seek overlap. If you seek marketshare you seek complimentary routes, right? IMO consolidation of corporate headquarters and changing a hub or two into a focus city is a far cry from substantially reducing the number of seats flying between city pairs throughout the network.
     
  10. BoeingBoy

    BoeingBoy Veteran

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    Good grief. Ever hear of chapter 7? How in the world was anything left to buy after everything was gone? Wouldn't everything being gone mean that there was nothing to buy? Here is the quote you posted:

    Jim
     
  11. SparrowHawk

    SparrowHawk Veteran

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    IIRC, didn't US end up with 2 or 3 757's from ATA?
     
  12. BoeingBoy

    BoeingBoy Veteran

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    Indirectly, 3 of them. But they were operated by another carrier between ATA and US. I think that all or nearly all of ATA's planes were leased but could be wrong. So they were leased to someone else after ATA, then finally leased to US when the other carrier's leases expired. Really, all WN wanted was the MDW gates but since ATA was in chapter 7 bankruptcy (or it may have been prior to converting from 11 too 7) they got everything cheap.

    Jim
     
  13. SparrowHawk

    SparrowHawk Veteran

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    They did some code sharing with ATA to Hawaii as well.
     
  14. BoeingBoy

    BoeingBoy Veteran

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    HP? I'll take your word for it, but it would explain the start of HP's Hawaiian service in 2004 - lose the code-share carrier so start their own.

    Jim
     
  15. SparrowHawk

    SparrowHawk Veteran

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    No ATA and WN

    HP/US has a code share with Hawaiian to this very day IIRC. No I'm gonna go look :D
     
  16. BoeingBoy

    BoeingBoy Veteran

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    I'm having a hard time figuring out what this
    has to do with this
    I thought you meant that pre-merger HP code-shared with HA from the mainland to/from HI. They did with ATA, and tried to buy ATA when it was in bankruptcy but were outbid by WN. That ended the code-share but pre-merger HP started HI service about the same time or not long after not getting ATA.

    I do think that post-merger US code-shares with HA on inter-island flights. I don't remember pre-merger US code-sharing with HA to/from HI, but with *A partner UA they didn't need to - but I could definitely be wrong.

    Jim
     
  17. FWAAA

    FWAAA Veteran

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    Looks like Doug Parker disposed of 272,350 shares on Aug 1 and Aug 2, 2006:

    http://phx.corporate-ir.net/phoenix.zhtml?c=196799&p=irol-SECText&TEXT=aHR0cDovL2lyLmludC53ZXN0bGF3YnVzaW5lc3MuY29tL2RvY3VtZW50L3YxLzAwMDEyMDkxOTEtMDYtMDQ0Mjc1L3htbC9zdWJkb2N1bWVudC8xL3BhZ2UvMQ%3d%3d

    Technically, you're correct. He didn't sell a single share; he sold 272,350 shares.

    Nope. He's not "all in." Your research didn't cover 2006, the year I earlier identified as the year in which it appeared that Parker's holdings declined.
     
  18. SparrowHawk

    SparrowHawk Veteran

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    I know I couldn't find everything post merger. I don't know if it matters that executives exercise their Stock Options or not. What does trouble me is it seems like US has made financial moves designed to pump up the short term number perhaps at the expense of long term growth and profitability. In some ways it looks as if the Balance Sheet is being "Buffed" to facilitate a merger. I just don't trust them and I question their motives.
     
  19. SparrowHawk

    SparrowHawk Veteran

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    Well here's one more whip mark on the dead horse!

     

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