United and Continental Talking....

[Andy]

More on the Northwest 'golden share' (from usaviation.com):

Section 4: Master Alliance Agreement

iii Additional Termination Rights

(a) In the event of a NW Change of Control, each of CO and NW shall have the right to terminate the Master Alliance Agreement on 6 months' prior written notice, without liability or penalty to the other party.


(d) For purposes of this term sheet, a "Change of Control" with respect to either NW or CO shall mean any merger, reorganization, share exchange, consolidation, business combination, recapitalization, liquidation, dissolution or similar transaction involving NW or CO, or any sale or disposition of all or substantially all of NW's or CO's airline assets on a consolidated basis, involving, or the acquisition of beneficial ownership of 25% or more of the equity securities or voting power of NW or CO by, a third-party air carrier or carriers with annual passenger revenues in any such carrier's most recently completed fiscal year in excess of $1 billion, or an affiliate of any such third-party air carrier(s), or the execution of definitive agreements in respect of any such transaction.

With Northwest filing chapter 11, it appears that they have lost their golden share. (Ch 11 = reorganization)

 

[Occam's Razor]

Andy,

RE: "With Northwest filing chapter 11, it appears that they have lost their golden share. (Ch 11 = reorganization)"

I don't think Chapter 11 is listed as one of the triggers. Reorganization is...but NWA is not reorganized, nor have they indicated when they will be.

 

[Andy]

A reorganization is what chap 11 is all about.

http://www.sec.gov/investor/pubs/bankrupt.htm

http://en.wikipedia.org/wiki/Chapter_11

http://www.extension.umn.edu/distribution/businessmanagement/DF7296.html

 

[densoo]

Yes that is pretty much it in a nutshell. I can tell you we have one of the best merger counsel Dan Katz and our merger committee is very sharp. Our merger chairman is now the US air pilot neutral in the US/AWA merger. Our vice chairman was the pilot neutral for Polar in the recent Atlas/Polar merger. They are well versed on ALPA merger policy.

If and when we go to an seniority arbitration you will be well represented and I believe our career expectations are as good or better then anyone in the business today. Do yourself a favor chill out negotiating merged lists on this forum will serve no purpose other than to give you an ulcer or worse a coronary.

Your merger committee is well prepared relax.

Well, OK then.

 

[COpilot]

Most important part of ALPA merger policy other than guaranteeing a seniority arbitration:


5. The merger representatives shall carefully weigh all the equities inherent in their merger
situation. In joint session, the merger representatives should attempt to match equities to
various methods of integration until a fair and equitable agreement is reached, keeping in
mind the following goals, in no particular order:
a. Preserve jobs.
b. Avoid windfalls to either group at the expense of the other.
c. Maintain or improve pre-merger pay and standard of living.
d. Maintain or improve pre-merger pilot status.


e. Minimize detrimental changes to career expectations.

Look I think we are getting way ahead of ourselves, but since we are, here's my two cents.

This is going to be easy when following the rules above, regardless of who is running ALPA...

With the location of the current crew bases, and the way the fleets are set up I can see a simple (relative term) set of fences and bid freezes set up for a few years ('ala NWA/REP).

After which a merged list with seat protections and percentage placements top to bottom would prevent windfalls and major disruptions.

If your in the top 5% before and you come out 3-8% post, if your 85% before and you come out 80-90% post; then with overall fleet increase your in the same position. Heck I'm 40% CA EWR now, I can't believe that enough UA staff will, or wants to come to EWR to move me down, RIGHT?

 

[Tejas-Jet]

Yes that is pretty much it in a nutshell. I can tell you we have one of the best merger counsel Dan Katz and our merger committee is very sharp. Our merger chairman is now the US air pilot neutral in the US/AWA merger. Our vice chairman was the pilot neutral for Polar in the recent Atlas/Polar merger. They are well versed on ALPA merger policy.

...and isn't Dan Katz the attorney representing the US Air pilots in the U/AWA seniority arbitration? If the CAL guys already have Dan Katz, then the UAL guys are already behind...

...maybe another "Summer of Love" might be in order?

Tejas

 

[CAL EWR B737]

Look I think we are getting way ahead of ourselves, but since we are, here's my two cents.

This is going to be easy when following the rules above, regardless of who is running ALPA...


If your in the top 5% before and you come out 3-8% post, if your 85% before and you come out 80-90% post; then with overall fleet increase your in the same position. Heck I'm 40% CA EWR now, I can't believe that enough UA staff will, or wants to come to EWR to move me down, RIGHT?

You are correct it doesn't matter who is the President of ALPA. I am just tired of hearing so many pilots saying we (CAL) will get screwed because were are CAL. Those days are long gone. How many times have you heard "I was on a United jumpseat and they said they are going to kill us in a merger integration" etc etc.

The only reason I mentioned the President in the post above is he will definitely make sure CAL's rights are protected as he will for all ALPA carriers. I'm sick of the beaten wife syndrome some of our pilots still exhibit. This isn't the CAL of ten or twenty years ago.

Pilots don't have two cents in a merger outcome only the arbitrator following ALPA merger policy based on the criteria listed above.

Hey I am about 40% in EWR you must be close to an 4/87 hire?

 

[CAL EWR B737]

...and isn't Dan Katz the attorney representing the US Air pilots in the U/AWA seniority arbitration? If the CAL guys already have Dan Katz, then the UAL guys are already behind...

...maybe another "Summer of Love" might be in order?

Tejas

Yes that is correct. We have retained Dan Katz ever since we had our first union the IACP. We have Katz for all mergers with the exception a merger involving USAIRWAYS.

 

[MSNFlier]

Apologies to Occam, I think Andy may be right...

Believe it or not, enormous amounts of money sometimes hinge on a comma! Let's go to the tape (emphasis in bold, added):

Section 4: Master Alliance Agreement

iii Additional Termination Rights

(a) In the event of a NW Change of Control, each of CO and NW shall have the right to terminate the Master Alliance Agreement on 6 months' prior written notice, without liability or penalty to the other party.

(d) For purposes of this term sheet, a "Change of Control" with respect to either NW or CO shall mean any merger, reorganization, share exchange, consolidation, business combination, recapitalization, liquidation, dissolution or similar transaction involving NW or CO, or any sale or disposition of all or substantially all of NW's or CO's airline assets on a consolidated basis, involving, or the acquisition of beneficial ownership of 25% or more of the equity securities or voting power of NW or CO by, a third-party air carrier or carriers with annual passenger revenues in any such carrier's most recently completed fiscal year in excess of $1 billion, or an affiliate of any such third-party air carrier(s), or the execution of definitive agreements in respect of any such transaction.

OK, again I'm not a BK attorney - it doesn't matter what I do for a job - the King's English controls here. If Andy's quote is correct, UAL/CAL' lawyers may be betting the bold wording above is operative here, and the second section after "...CO, or any sale...," is not relevant because when a company goes Ch. 11 it does cede control of the company to the debtor-in-possession (DIP) lender, creditors' committees and the bankruptcy court (thus one of the things evidencing a Change of Control...is...reorganization...).

But, since banks, Boeing, Airbus, GE, P&W, etc., etc., don't want to run the airline themselves they let management continue to do so, under their watchful eyes and that of the bankruptcy court judge. Recall the recent news about DL's current management saying their "plan" is better than a US Air/DL merger? And Parker saying US Air's proposal was better? That wasn't about convincing anyone but DL's creditors option A or B was better - because the creditors control the airline, subject to the BK judge's approval.

NWA might be out of luck. UAL/CAL would not go to the trouble of having their respective CEOs meet without doing lots of legal homework first. You can be fairly certain the lawyers have developed a strategy or contingencies for hosing NWA's power to stop a deal. UAL and CAL might be able to weaken or wipe out NWA's leverage by showing that its power to meddle in CAL's plans evaporated when they filed BK. Maybe so much so that UAL/CAL might be able to buy NWA now too, but for way less because NWA is in bankruptcy and, short of liquidation, it won't be worth less than it is now.

One question...how much of NWA's revenues come from their code-share with CO? If it's a significant number (say 15-20%), might that call into question NWA's survival through/after BK without CO? If so, NWA's possibly dim long-term prospects might make it a very attractive target for a low-ball offer because NWA's creditors would be very skittish about whether they'll get paid by NWA at all.

Remember, there are no more shark-infested waters than those around a bankrupt company. Expect the unexpected. NWA might be in an awful bind here.

 

[Occam's Razor]

Thanks, counselor!

I wonder if any of the other SEC filings NWA has made regarding the Agreement have any bearing?

 

[Palomino]

You are correct it doesn't matter who is the President of ALPA. I am just tired of hearing so many pilots saying we (CAL) will get screwed because were are CAL. Those days are long gone. How many times have you heard "I was on a United jumpseat and they said they are going to kill us in a merger integration" etc etc.

The only reason I mentioned the President in the post above is he will definitely make sure CAL's rights are protected as he will for all ALPA carriers. I'm sick of the beaten wife syndrome some of our pilots still exhibit. This isn't the CAL of ten or twenty years ago.

this is the understatement of the year!

 

[BigMotorToter]

Portion of United ALPA email to it's membership...

"How, then, you might ask, did the American pilots avoid an arbitration with the TWA pilots? The simple fact is that a court found at the time American proposed to buy TWA that TWA was on the verge of liquidation. The TWA pilots were told by American that they would have to waive their contractual right to arbitration and accept the proposed seniority list, or no transaction would take place. The TWA pilots elected to waive their contractual rights and accept the only deal available in order to salvage at least some of their careers. "


This is 100% wrong. How do I know? I was there, at the table.

Actually the oposite is true.

The APA requires any acquired airline's pilot group (you NWA boys need to take special attention to this) to give up their Allegheny-Mohawk LPP''s in order to allow AA to buy, acquire, merge another airline. At the time, AA really wanted this deal to go through. So AA came to the TWA pilots and said, "we will let you keep the rest of your ALPA contract until the merger is complete as long as you give up your arbitration rights."

We told them to go f themselves.

They then said, (and ALPA's lawyer's assigned to us backed this up) we will still press on with the acquisition, but we will strip you of all your ALPA contract and impose our own pay and work rules separate from the APA contract, until you are under the "green book" (APA's name for their contract).

This was all prior to 9/11. And also prior to any final seniority list mentioned in the above Untied ALPA email.

We were all then worried that they could lay us ALL off, and replace us with new hires.

We still told them to go f themselves.

ALPA's lawyers were then sent to STL by Duane Worth who then called an emergency meeting in STL with our MEC. We were told by our "expert" lawyers, that we were all in danger of having no contract whatsoever, which would jeopordize the entire seniority list during the acquisition. And that we better take the deal ASAP.

We, the pilots, wanted to take this up with the Bankruptcy judge, but our "expert" lawyers said that if you take this to the judge, he would have to make a ruling, and that bankruptcy judges in 1113 filings don't have the authority to uphold portions of contracts. They can either uphold the entire contract or throw the whole thing out. Therefore, because our ALPA assigned lawyers told us the risk was too great of loosing the entire contract, we had to take the AA deal.

Lets make this clear. AA wanted this deal no matter what. UAL and USair was happening and AA had to do something so not to lose market share. This deal was going through one way or another, regardless of any liquidation fears.

Once this was done, the APA ran right over us with a freight train. They forced their seniority list down our throats, ( a list we never agreed to by the way, which has allowed us to seek relief from the courts) And Duane Worth was going to be one step away from his dream of bringing in the APA to ALPA.

We, the former TWA pilots, have since learned that the advice given to us by the ALPA lawyers was false. That Duane Worth had alterior motives for wanting us to concede to the APA. That motive, already mentioned was to get AA into the ALPA fold, thus completing Duane's pledge of getting CAL, FEX and AA back into ALPA. Basically, selling us out so not to piss off the APA thus increasing the odds they vote in ALPA.

Ironicaly, many of the AA pilots I have spoken to, now want nothing to do with ALPA, because of the way ALPA deffended us.

People, this is fact. This event, backed up with hard evidence, is why the Appeals Court upheld our lawsuit against ALPA, and is one of many reasons we will be going to trial hopefully by the fall of 2007.

I will say, that all you guys who end up in an ALPA to ALPA merger will be better off than the poor bastards that end up in the cross hairs of AA. May god have mercy on your souls.

 

[COpilot]

Most important part of ALPA merger policy other than guaranteeing a seniority arbitration:


5. The merger representatives shall carefully weigh all the equities inherent in their merger
situation. In joint session, the merger representatives should attempt to match equities to
various methods of integration until a fair and equitable agreement is reached, keeping in
mind the following goals, in no particular order:
a. Preserve jobs.
b. Avoid windfalls to either group at the expense of the other.
c. Maintain or improve pre-merger pay and standard of living.
d. Maintain or improve pre-merger pilot status.
e. Minimize detrimental changes to career expectations.

Yes, I see your point CAL.

Hey, do you think that they will reject me? In '93 they told me that my BS in Aero Science, 2 types, a FE rating, and 6000TT was not enough to qualify for a interview. Hey, now all of the old Frontier GP's can be Brain surgeons...lol!

just kidding,,, Heck, this is all so serious we've got to laugh.

I was late '87, I'm on the crack pipe too (thats our site)

 

[cal73cap]

Cal-Ua Merger-Yes
UA Airbuses parked or sold-Yes
Hiring at Cal stopped-Yes
Merger by DOH-Some
Merger by ratio-Some
Fences-Yes
Dulles closed-Yes
Cleveland closed-Yes
My two cents!-Yes

 

[General Lee]

Cal-Ua Merger-Yes
UA Airbuses parked or sold-Yes
Hiring at Cal stopped-Yes
Merger by DOH-Some
Merger by ratio-Some
Fences-Yes
Dulles closed-Yes
Cleveland closed-Yes
My two cents!-Yes

IAD could probably sustain service by itself. The Capital of our nation needs International service from a US airline. I think both would stay. I don't see Southwest flying to Brussels anytime soon.


Bye Bye--General Lee

 

[tomgoodman]

What might have been

I was one of the principals involved in the Super Bowl Sunday 98 potiental merger with DAL.

Can you give us a little more history on that one? How close do you think it came? Did they have a plan to resolve anti-trust beefs (like too much combined presence in NYC/EWR)?

 

[whymeworry?]

Remember, there are no more shark-infested waters than those around a bankrupt company. Expect the unexpected. NWA might be in an awful bind here.

Funny, it was NW that single-handedly sabatoged virtually every fare-hike post 9/11 up until late last year when the first fare hikes began to stick for once. By that point NW had already filed.

I feel bad for their pilots, somewhat. I say somewhat because they folded like a wet noodle when it came to accepting a pathetic contract. I know not all of them voted yes but there was very little fight overall nonetheless.

Anyway, back to NW mgmt and their arrogance. If the Legacy carriers simply passed on the fuel hike to customers in the form of a surcharge, as VIRTUALLY EVERY BUSINESS IN AMERICA HAS BEEN DOING SINCE OIL BEGAN TO RISE, our industry would be in a lot better shape today. Every time the majors tried to raise prices, NW was always the sole carrier who refused to follow suit, even envoking a fare war at times. That management team played havoc with the industry and lives have been ruined. It was so bizarre how they behaved it was almost like they were just out to play games. Now the tables are turned. Ain't Karma a bitch.

 

[whymeworry?]

Portion of United ALPA email to it's membership...

"How, then, you might ask, did the American pilots avoid an arbitration with the TWA pilots? The simple fact is that a court found at the time American proposed to buy TWA that TWA was on the verge of liquidation. The TWA pilots were told by American that they would have to waive their contractual right to arbitration and accept the proposed seniority list, or no transaction would take place. The TWA pilots elected to waive their contractual rights and accept the only deal available in order to salvage at least some of their careers. "


This is 100% wrong. How do I know? I was there, at the table.

Actually the oposite is true.

The APA requires any acquired airline's pilot group (you NWA boys need to take special attention to this) to give up their Allegheny-Mohawk LPP''s in order to allow AA to buy, acquire, merge another airline. At the time, AA really wanted this deal to go through. So AA came to the TWA pilots and said, "we will let you keep the rest of your ALPA contract until the merger is complete as long as you give up your arbitration rights."

We told them to go f themselves.

They then said, (and ALPA's lawyer's assigned to us backed this up) we will still press on with the acquisition, but we will strip you of all your ALPA contract and impose our own pay and work rules separate from the APA contract, until you are under the "green book" (APA's name for their contract).

This was all prior to 9/11. And also prior to any final seniority list mentioned in the above Untied ALPA email.

We were all then worried that they could lay us ALL off, and replace us with new hires.

We still told them to go f themselves.

ALPA's lawyers were then sent to STL by Duane Worth who then called an emergency meeting in STL with our MEC. We were told by our "expert" lawyers, that we were all in danger of having no contract whatsoever, which would jeopordize the entire seniority list during the acquisition. And that we better take the deal ASAP.

We, the pilots, wanted to take this up with the Bankruptcy judge, but our "expert" lawyers said that if you take this to the judge, he would have to make a ruling, and that bankruptcy judges in 1113 filings don't have the authority to uphold portions of contracts. They can either uphold the entire contract or throw the whole thing out. Therefore, because our ALPA assigned lawyers told us the risk was too great of loosing the entire contract, we had to take the AA deal.

Lets make this clear. AA wanted this deal no matter what. UAL and USair was happening and AA had to do something so not to lose market share. This deal was going through one way or another, regardless of any liquidation fears.

Once this was done, the APA ran right over us with a freight train. They forced their seniority list down our throats, ( a list we never agreed to by the way, which has allowed us to seek relief from the courts) And Duane Worth was going to be one step away from his dream of bringing in the APA to ALPA.

We, the former TWA pilots, have since learned that the advice given to us by the ALPA lawyers was false. That Duane Worth had alterior motives for wanting us to concede to the APA. That motive, already mentioned was to get AA into the ALPA fold, thus completing Duane's pledge of getting CAL, FEX and AA back into ALPA. Basically, selling us out so not to piss off the APA thus increasing the odds they vote in ALPA.

Ironicaly, many of the AA pilots I have spoken to, now want nothing to do with ALPA, because of the way ALPA deffended us.

People, this is fact. This event, backed up with hard evidence, is why the Appeals Court upheld our lawsuit against ALPA, and is one of many reasons we will be going to trial hopefully by the fall of 2007.

I will say, that all you guys who end up in an ALPA to ALPA merger will be better off than the poor bastards that end up in the cross hairs of AA. May god have mercy on your souls.

Good for you and your pilot group. Its refreshing to see someone stand up to the big boys of our union and to the evil deeds that occur within organized labor. I wish you all the luck. Lawyers have to recognize there are ramifications for lying... and if they did lie to your pilot group, they ought to be disbarred.

Y'all ought to start a fund so that those of us who sympathize with your position can donate to your cause.

 

[Powda5]

I am in a funny (but not so much) position of being furloughed from UAL (appx 100 from the bottom and just got my recall letter) AND a 1 year newhire at CAL.

I looked at both sides from this viewpoint and wish I could figure out the ALPA merger policy and how it would work, exactly. Since DOH is not a factor in the policy, I think that as a CAL newhire, I am better off than my 'furloughed UAL self' in terms of what comes out of a possible merger. CAL upgrades 5 years, UAL 8 years (this is my own research based on junior capts)...

In less than 10 years I expect to be better than halfway up COA's list, while at UAL I would only be at 25% from the bottom. Is this how I should be looking at ALPA's merger policy or is there way more to it? Would they put someone like me close to my percentage (in a merged list) that I currently hold at CAL? I doubt either CAL or UAL could be considered a 'failing carrier', so I don't think either has the upper hand when it comes to arguing which group gets the better deal in a merged list.

Someone mentioned that UAL or CAL could propose hire date. How could hire date be proposed when it's not part of the merger policy? If it's agreed upon then we can add that?

Retirement numbers are very close year to year, but like someone pointed out, UAL has roughly twice the pilots.

Some of you guys who have experience in ALPA or mergers or just know some history....is there a lot more to be considering, or is this basically it?

 

[BigMotorToter]

whymeworry,

Thanks for your support. We do actually have a site set up with info and a contribution address. Try this:

http://twapilots-vs-alpa.com/

If the link doesn't work, just type it in, it should work.

Thanks again.