Chapter 11 Soon?

[USA320Pilot]

On August 4 in a required quarterly filing with the SEC, US Airways said that while it was in compliance with financial covenants of federally guaranteed loans as of June 30, "it anticipates risk of failing to comply with the covenants as of Sept. 30, 2004." US Airways said failure to achieve a competitive cost structure and to complete its Transformation Plan on a consensual basis "will force the company to re-examine its strategic options, including, but not limited to, a judicial restructuring."

The company stressed the need to achieve its Transformation Plan during the third quarter "in light of the potential loss of financing for new regional jets, violation of debt covenants and significant collateralization events under certain credit card processing agreements." Terms of the loan guaranteed by the Air Transportation Stabilization Board require US Airways to maintain certain cash and debt terms, among other items.

There is now reason to believe that if US Airways does not have new labor accords in place by Saturday, September 11, the company will file for Chapter 11 bankruptcy on Sunday, September 12.

The intent is to make the filing over the weekend to limit financial damage and to not make about $110 million in required payments to the AFA and IAM Defined Benefit pension plans. Any union who does not have a new agreement by September 11 will have a S.1113 motion filed in court to set aside their contract shortly after the the "judicial reorganization" filing.

In addition, the company could close both the Pittsburgh and Winston-Salem reservations and Pittsburgh and Charlotte Maintenance facilities shortly after the bankruptcy filing.

Good luck to us all.

Respectfully,

USA320Pilot

 

[PITbull]

Well then, its finally out as planned!

Thanks USA320, thought you would have the info when BKwould occur. Pretty much knew it would be before the payment of the pensions which are due on Sept 15.

Thing is whether we have agreements or not, U still would have to make those payments, and the only way to get out of it is to go into BK. The other strategy that I believe is in play is to make the proposals so damn unrealistic, that the company knows the unions CAN'T AGREE.

So, file they will...and NO profit sharing that I suspected was not going to happen anyway!

 

[repeet]

Thanks for the dates, I'll put them on my social calendar.

No, wait, these plans are suppost to be secret right? Or is this board the new S.E.C. clearing house for information.

I'm sure that they're alot of stockholders out there that really appreciate this information.

 

[PITbull]

Well, can't be the two "fast Eddies", Dave and Neal...they had their stocks "unrestricted" when they left so they probably have "cashed out".

My stock is worth today total...ready....$135. I could probably buy about 4 tanks of gas. :angry:

Yup, I'm lov'in life!

 

[PITbull]

Bob,

If this is even remotely true, it will erode any future discussions with managment IMO....

It doesn't make us rush to the table and sign on any damn dotted line.


There sure is something wrong with the BK laws when a company can report a PROFIT in the quarter and then go dancing into BK the following month...GEEZUS!

 

[USA320Pilot]

PITBull:

There is still time to prevent a bankruptcy filing, keep as much of the pension plans as possible, profit sharing, and to not get a worse deal in bankruptcy.

In regard to the DB Plans, the company could pull a United, but taht does not appear to be on the radar scope.

It's nonsense to suggest that any of us will be better off facing the judge, thus each union and its members will have to make a choice.

In my opinion, when Bruce Lakefield meets with the ALPA MEC this week, he will give the union one last chance to obtain a TA. Then shortly thereafter the company will provide the pilots with their last, best offer and then it will be decision time.

I suspect the same thing will happen to your union, the CWA, and TWU units too.

In regard to the two IAM unions, they will have to make a decision. For the IAM-FSA, either agree to work for a LCC type contract or move on. For the IAM-M, either agree to an LCC type contract and a cost effective way to conduct overhaul in-house, or move on.

It's now decision time and if what I am hearing is true, there are 34 days left until B-Day.

Respectfully,

USA320Pilot

 

[PITbull]

USA320,

TWU????...THEY DON'T EVEN KNOW THEIR COST TARGET YET!
NO one has discussed anything with them yet! Did you know that?

I know it for a fact, because TWU is represented through our Board seat, and AFA is very close to the leaders of TWU.

 

[SpinDoc]

Bob,

If this is even remotely true, it will erode any future discussions with managment IMO....

It doesn't make us rush to the table and sign on any damn dotted line.
There sure is something wrong with the BK laws when a company can report a PROFIT in the quarter and the go dancing into BK the following month...GEEZUS!

[post="166806"][/post]​

Don't have a cow everyone. This is a
Forum, not an SEC sanctioned internet
conference. Anything posted on here is
speculaton and opinion unless otherwise
proven. While BK may solve a large
portion of the company's problems, it
is likely that it will come in the form of
an involuntary CH11 or 7 brought about
by creditors or the ATSB, and not
a company sponsored event.

 

[USAirBoyA330]

If this turns out to be true the SEC will have a field day and whoever in the company leaked this info will be joining Martha Stewart
They can subpoena the IP addresses and trace everything.....as well they should. This is crap and if they are going to file then just go ahead and do it for gosh sakes. Enough chest thumping.....Rome was not built in a day! They are asking for the sun, moon and stars knowing it takes time......so then they can just do whatever they want anyway. It so transparant. :down:

 

[tadjr]

Then shortly thereafter the company will provide the pilots with their last, best offer and then it will be decision time.

I suspect the same thing will happen to your union, the CWA, and TWU units too.

[post="166807"][/post]​

We're still waiting for their second offer, let alone last and best. If Sept 12th is the day, so be it. At least the waiting will finally be over. And yes, before you ask AGAIN, I have alternate plans, thanks for the concern.

 

[PITbull]

Hell, AFA has only received 1 proposal as well.

There is only 1 managment team that is responsible for all these proposals and negotiations...

Does Lakefield have a CLUE???? Someone give him one?


Damn piece of s$%^, garbage. :angry: :angry:

 

[oldiebutgoody]

If UAIR is THAT close to chapter 7 or 11, NO amount of concessions will help now, since those savings would not even be seen until October. The rumor mill folks sure know who to feed info to to get a reaction out of everyone. Let's face it, folks. Management has had over three years to restructure, and to date the ONLY thing that they have accomplished is to park 125 or so jets, furlough 20,000 or so people (many with families), and rape he employees twice already with at least one more savage attack on the way. If UAIR is done, then let it die with dignity. Truth be told, I and many more investors (and many employees) wish we had NEVER heard of U (or UAIR).

 

[Rob]

There sure is something wrong with the BK laws when a company can report a PROFIT in the quarter and then go dancing into BK the following month...GEEZUS!

A company does not have to be insolvent or even unprofitable in order to declare bankruptcy. All that is required is the ability to demonstrate inevitable insolvency unless conditions which the company has been unable to deal with are changed by the court's order.

For example, Armstrong World Industries was profitable and solvent but declared bankruptcy because asbestos claims could not be estimated and were overwhelming them.

 

[AC/CF]

I just have two questions for someone that has all the answers. Why must we accept 13.10 per hour, when there are many LCC that top out at a higher amount. And if it is true the Pit and Winston res offices COULD close, then the company must have a plan in the works already. An airline could not function without some reservations offices. I would love to know what that plan consists of.

 

[700UW]

The company cannot file voluntary, read the ATSB loan document.

As explained in an involuntary bankruptcy the company's officers can and most likily lose control of the company and a the creditor's committee and the trustee run the company.

An involuntary bankruptcy may be commenced for purposes of obtaining a chapter 7 liquidation or a chapter 11 reorganization against any debtor who is eligible for voluntary bankruptcy. An involuntary bankruptcy is commenced by the filing of a petition with the bankruptcy court. In an involuntary case, the petition must be signed by three creditors who do not have contingent claims or claims that are subject to a bona fide dispute. A bankruptcy or workout attorney can assist in contacting other creditors and preparing a petition in bankruptcy provided three creditors agree to proceed with the filing.

The filing of a petition for involuntary bankruptcy has the same effect as the filing of a petition for voluntary bankruptcy in two important respects. The filing creates a bankruptcy estate and it brings into effect the automatic stay, which prevents creditors from taking action to enforce their claims unless relief from the automatic stay is granted by the bankruptcy court.

The debtor has the right to contest the involuntary bankruptcy filing. In the event the bankruptcy is contested, the bankruptcy court will look at whether the debtor is paying its debts as they become due, and whether the debtor has assigned property for the benefit of creditors or suffered the appointment of a receiver to take charge of the debtor's property.

An involuntary bankruptcy is a valuable tool for a creditor who has limited remedies with which to collect a debt. For instance, where other creditors have levied on all of the assets of the debtor and the claims of those creditors equals or exceeds the value of the assets, a creditor who levies later will receive nothing. If the creditor can find two other creditors who have missed out in this manner, they can file an involuntary bankruptcy petition and force the other creditors who have levied on the assets to return the assets to the bankruptcy estate. The assets may then be distributed in a more equitable manner. Finally, the bankruptcy trustee has broad powers to investigate the financial affairs of the debtor to ascertain whether any preferential transfers of money or assets occurred prior to the filing.