Uair Can't Make A $110m Pension Payment?

[usair_begins_with_u]

But US Airways told the court it cannot make the $110 million payment due Wednesday for pension plans covering members of the International Association of Machinists and the Association of Flight Attendants, and that it may ask to terminate those plans.

It listed assets of about $8.8 billion and liabilities of $8.7 billion. It has about $1.45 billion in cash.


WTF?

They can't make the payment, or is it they just simply dont want to make the payment??

http://biz.yahoo.com/rb/040913/airlines_usairways_6.html

 

[AtlanticBeach]

They can't make the payment, or is it they just simply dont want to make the payment??

The cash reduction would have placed the company in a precarious position regarding unrestricted cash, which is about half of the total amount.

The company line will probably be that they can't. (I have not read that motion) A review of history skews to the other answer being more accurate.

 

[FWAAA]

The cash reduction would have placed the company in a precarious position regarding unrestricted cash, which is about half of the total amount.

The company line will probably be that they can't. (I have not read that motion) A review of history skews to the other answer being more accurate.

[post="179601"][/post]​

Exactly. Unrestricted cash was only $750 million on Friday, according to this document:

http://www.donlinrecano.net/dr201/mwc/04-1...000006-0000.pdf

Depleting its available unrestricted cash by one seventh this week for pensions (which it will probably try to eliminate, ala UAL) wouldn't be smart.

 

[usair_begins_with_u]

Exactly. Unrestricted cash was only $750 million on Friday, according to this document:

http://www.donlinrecano.net/dr201/mwc/04-1...000006-0000.pdf

Depleting its available unrestricted cash by one seventh this week for pensions (which it will probably try to eliminate, ala UAL) wouldn't be smart.

[post="179607"][/post]​

No cash is restricted once you have protection under Chap 11...

 

[FWAAA]

No cash is restricted once you have protection under Chap 11...

[post="179629"][/post]​

Oh, Really?

You might want to relay that good news to the CFO at UAL: Their current balance sheet (as of 6/30/04) shows $838 million of restricted cash out of a total of $2.215 billion of total cash.

At June 30, 2004, UAL had $838 million in restricted cash, primarily representing security for worker compensation obligations, security deposits for airport leases and reserves with institutions that process the Company's sales.

http://ccbn.tenkwizard.com/filing.php?repo...00000&VL=0066FF

Even companies in Ch 11 must segregate their cash; otherwise the credit card companies will cut you off immediately.

 

[ringmaruf]

But US Airways told the court it cannot make the $110 million payment due Wednesday for pension plans covering members of the International Association of Machinists and the Association of Flight Attendants, and that it may ask to terminate those plans.

It listed assets of about $8.8 billion and liabilities of $8.7 billion. It has about $1.45 billion in cash.
WTF?

They can't make the payment, or is it they just simply dont want to make the payment??

http://biz.yahoo.com/rb/040913/airlines_usairways_6.html

[post="179594"][/post]​

They're actually legally not allowed to make that payment, because it's a "prepetition" claim, and has to get in line with all the other prepetition claims. (Although I'm sure they don't want to make the payment as well.)

What US did today was file to be able to make the pension payments as they come due from now on in the postpetition period.

They also said they anticipate replacing the AFA/IAM defined benefit plans with a defined contribution plan. They said they don't know if they will distress terminate the existing plan (like the pilots) or freeze the existing plan (like the agents in 1992).

The filing is available here: http://www.donlinrecano.net/dr201/mwc/04-1...000052-0000.pdf. I suggest reading it. There is a lot of legal-speak, but probably not too much as to make it unreadable.

 

[Schatzee]

Weren't they also waiting on a decision from the IRS about being able to take a credit for an earlier payment today? Couldn't remember which pension it was for.

 

[willyloman]

But US Airways told the court it cannot make the $110 million payment due Wednesday for pension plans covering members of the International Association of Machinists and the Association of Flight Attendants, and that it may ask to terminate those plans.

It listed assets of about $8.8 billion and liabilities of $8.7 billion. It has about $1.45 billion in cash.
WTF?

They can't make the payment, or is it they just simply dont want to make the payment??

http://biz.yahoo.com/rb/040913/airlines_usairways_6.html

[post="179594"][/post]​

Ask the next pilot you see,he knows.

 

[PITbull]

But US Airways told the court it cannot make the $110 million payment due Wednesday for pension plans covering members of the International Association of Machinists and the Association of Flight Attendants, and that it may ask to terminate those plans.

It listed assets of about $8.8 billion and liabilities of $8.7 billion. It has about $1.45 billion in cash.
WTF?

They can't make the payment, or is it they just simply dont want to make the payment??

http://biz.yahoo.com/rb/040913/airlines_usairways_6.html

[post="179594"][/post]​

My understanding is they don't want to make the payments.

 

[Iflyem]

But US Airways told the court it cannot make the $110 million payment due Wednesday for pension plans covering members of the International Association of Machinists and the Association of Flight Attendants, and that it may ask to terminate those plans.

It listed assets of about $8.8 billion and liabilities of $8.7 billion. It has about $1.45 billion in cash.
WTF?

They can't make the payment, or is it they just simply dont want to make the payment??

http://biz.yahoo.com/rb/040913/airlines_usairways_6.html

[post="179594"][/post]​

 

[Iflyem]

Seems to me that a wise course of action would be to take monies from the top 20 percent of management "Golden parachute" payouts and fund the pensions from that. If you don't hurt management in their own pocketbooks, they just won't get the picture.

 

[allegheny1]

To All
The company also did not make payments to various defined contribution
plans.
Deposits that should have been made last friday 9/10/04 for checks dated the
previous friday 9/03/04 were not made. This . as far as I know, would
affect everyone who had their dbc plan frozen in 1991 and replaced with the
current 401k program.

regards