AMR Wins U.S. Court Approval for $1.5 Billion Financing

[usa1]

http://www.bloomberg.com/news/2013-01-17/amr-wins-u-s-court-approval-for-1-5-billion-financing.html

 

[TWU informer]

Anything AMR wants, Judge Lane makes sure AMR gets.

 

[1AA]

Anything AMR wants, Judge Lane makes sure AMR gets.

Ain't that the truth.

 

[eolesen]

Great pile-on, but go read the fine print. This was actually a good call.

When AMR declared bankruptcy, the banks called the principle & interest due on the bonds in question. AMR agreed to do that.

Fair enough,right? There should be no arguing, right?

Nope. The banks also wanted AMR to pay the future interest dthat would have been due if the notes had been carried to maturity.

In short, The banks wanted have their cake (calling the notes) and eat it, too (the future interest).

The judge said they could take their cake and shove it.

 

[Bob Owens]

Great pile-on, but go read the fine print. This was actually a good call.

When AMR declared bankruptcy, the banks called the principle & interest due on the bonds in question. AMR agreed to do that.

Fair enough,right? There should be no arguing, right?

Nope. The banks also wanted AMR to pay the future interest dthat would have been due if the notes had been carried to maturity.

In short, The banks wanted have their cake (calling the notes) and eat it, too (the future interest).

The judge said they could take their cake and shove it.

In other words the banks wanted interest on money that was no longer at risk. Are we supposed to think that Lanes refusal to grant that makes what he did to labor OK?
Lane should have liquidated the notes and told the banks like he told labor consider your sacrifices a gift to AMR because they need it more than you do.

 

[FWAAA]

When banks negotiate contracts, they have to live by the contract terms they negotiate, even when the debtors file for bankruptcy protection. From the ruling:

If the parties wished for the Make-Whole Amount to be due in these circumstances, they could have bargained for such a provision. Instead, the parties bargained for the exact opposite result, with the Indentures stating clearly, explicitly and unambiguously that the Make-Whole Amount is not due in the event of payment following acceleration.

Whoops.

Under the language of the Indentures then, the Noteholders here are entitled to receive full repayment of principal and accrued interest without a Make-Whole Amount, which is exactly what they bargained for in these circumstances. The Debtors are therefore within the limits circumscribed by their Section 1110(A) election, which simply requires them to comply with the terms of the Indentures. Each contract is different, of course, and parties are free to draft their contracts as they wish.

That's the judge ####-slapping US Bank. That's what happens when you try to impose contract provisions that you didn't bargain for.

 

[Bob Owens]

When banks negotiate contracts, they have to live by the contract terms they negotiate, even when the debtors file for bankruptcy protection. From the ruling:

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Whoops.

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That's the judge ####-slapping US Bank. That's what happens when you try to impose contract provisions that you didn't bargain for.

####-slapping? More like back slapping as soon as the witnesses are out of sight. Please, what a charade, they are walking away with all their money, plus accrued interest, they lost nothing. Now if the Judge had told them they were getting pennies on the dollar or maybe a few shares for their cash investment then maybe we could say he went hard on the banks. The fact that they would even ask for it just shows what a scam for corporate America BK has become, the only ones that lose are the workers.

 

[eolesen]

The only ones to lose are the workers, eh?

How many paychecks have you received that didn't reflect the full hourly amount as specified in the contract that was in effect the days you punched in & out? Seems to me you've been paid in full and your contracts are being honored to the letter.

I know you have a problem with anyone other than labor getting money, but you get what your contract specifies, and they're getting what their contract specified.

 

[Bob Owens]

The only ones to lose are the workers, eh?

How many paychecks have you received that didn't reflect the full hourly amount as specified in the contract that was in effect the days you punched in & out? Seems to me you've been paid in full and your contracts are being honored to the letter.

I know you have a problem with anyone other than labor getting money, but you get what your contract specifies, and they're getting what their contract specified.

Let me know when the Judge tells vendors or banks that going forward they have to sell their product for whatever AA "feels like" paying until they agree to new terms.

 

[eolesen]

OK, as long as you let me know when the Judge tells employees that they have to return the paychecks received in the 90 days prior to bankruptcy (which is what happens to vendors), or that they have to work for free up to 60 days following the filing (which is essentially what happens to aircraft lessors).


I know you think you got the worst deal possible, but it's not like you were told for several years leading up to the filing that you'd be better off negotiating something cost neutral outside of the bankruptcy. Hawaiian Airlines' employees figured that one out.

There was no reason you guys couldn't have done the same, except that the chips on your shoulders were too damn big to see around.

 

[700UW]

HA filed bankruptcy twice and got concessions from its employees.

The Honolulu-based airline filed for Chapter 11 on March 21, 2003. Since then, Hawaiian has restructured its aircraft leases and negotiated new three-year labor contracts with its six union groups. All but two of the contracts, covering flight attendants and pilots, have been ratified.

Last year, when Hawaiian Airlines, the state's largest airline based on revenue, filed for Chapter 11 protection, employees gave $15.3 million in concessions to help keep the airline operating. Ten years earlier, when the airline filed its first bankruptcy, the employees agreed to a pay freeze and made concessions on vacation and sick leave.

How did those concessions outside of chapter 11 in 2003 workout for AA and its employees?

 

[eolesen]

As I recall, with the exception of ALPA and the IAM, Hawaiian's unions had waiver letters as part of their restructured contracts. They didn't go thru S1113.

 

[TWU informer]

Great pile-on, but go read the fine print. This was actually a good call.

When AMR declared bankruptcy, the banks called the principle & interest due on the bonds in question. AMR agreed to do that.

Fair enough,right? There should be no arguing, right?

Nope. The banks also wanted AMR to pay the future interest dthat would have been due if the notes had been carried to maturity.

In short, The banks wanted have their cake (calling the notes) and eat it, too (the future interest).

The judge said they could take their cake and shove it.

My point was in general and not specific to this issue. Can you name one instance where Judge Lane has failed to give AMR what they wanted? At least one thing of any value to the losers here?

 

[OldGuy@AA]

My point was in general and not specific to this issue. Can you name one instance where Judge Lane has failed to give AMR what they wanted? At least one thing of any value to the losers here?

Your wasting your time trying to reason with this narrow minded elitist. In his warped view of the world labor is greedy when they expect a fair wage from corporate America. This guy's dream is to be a CEO and screw the peons.

 

[FWAAA]

My point was in general and not specific to this issue. Can you name one instance where Judge Lane has failed to give AMR what they wanted? At least one thing of any value to the losers here?

When the law and facts are on your side, you tend to prevail.

Either that or the Bob Owens view that the judicial system is hopelessly corrupt and AMR obviously bought off the judge. Wonder why US Bank wasn't smart enough to buy off the judge?

This case was a clear victory for AMR, of which the three unions own 21.3%. From reading Bob's posts in this thread, it sounds like he would have applauded a victory for US Bank, as if the lawyers were arguing over Horton's money. This decision will save AA something like $200 million.