MESA -200s for UAL...TOAST

[rene]

Can't Cancel

These clauses have not been enforcable in BK. They cannot cancel the contract in BK.

 

[rickair7777]

These clauses have not been enforcable in BK. They cannot cancel the contract in BK.

Sure they can. BK only gets you off the hook with your VENDORS and CREDITORS. It's a one-way street.

It cannot force your CUSTOMERS to keep using you...especially if their contract specifically lets them off the hook if you file BK. It's a reasonable contractual provision since a BK regional airline cannot be expected to maintain safety standards.

 

[rene]

Sorry, you are wrong. These provisions are not enforcable and have no connection whatsoever to safety standards. Many airlines have filed for BK protection very few have ever had safety issues.

Bottom line is this. IF Mesa files for BK they can restructure under the protection of the court. That same court will never allow Delta or any other customer to cancel the contract. This is a matter of law. It has already been tested is many courts. This clause is simply unenforcable.

Mesa will survive and flourish

 

[SEVEN]

Mesa will survive and flourish

No they won't. Delta doesn't want them and neither does United. Even if they are forced to continue a contract, it's over when the contract expires. Maybe Mesa can work out a deal to code-share with SWA.

 

[Speedtape]

UAL and Delta see the writing on the wall for Mesa. UAL is limiting exposure by canceling contracts, while Delta has moved them to the least important network hub to limit the impact on operations.

In May 2010, Mesa will have 63 spare airplanes:
CRJ 200 - 25 (they will have 33 spares, but 8 can be returned in April with significant lease return fees)
ERJ - 12
DHC8 - 6 (have 10, 4 can be returned on 4/30/10)
B1900 - 20

96 Airplanes will remain in revenue service:

CRJ 200 - 10 USAir
CRJ 700 - 20 UAL
CRJ 900 - 38 USAir
ERJ 145 - 22 Delta
DCH 8 - 6 USAir

As of June 30, Cash was 21M unrestricted and 14M restricted.

Mesa attempted to acquire 10 CRJ 700's for UAL, but was unable to obtain financing.

CRJ 700 - 20 UAL soon to be operated by a regional based in ATL

CRJ 900 - 38 USAir soon to be operated by a regional based in SLC and maybe ATL

ERJ 145 - 22 Delta soon to be going away

 

[Speedtape]

Sorry, you are wrong. These provisions are not enforcable and have no connection whatsoever to safety standards. Many airlines have filed for BK protection very few have ever had safety issues.

Bottom line is this. IF Mesa files for BK they can restructure under the protection of the court. Depends on the type of bankruptcy filed and whether the judge ascertains whether the entity is a viable on-going concern that, should it survive, can have a reasonable chance of paying off creditors--otherwise, it's Chapter 7 Liquidation. Limited or no revenue streams = non viable entity

That same court will never allow Delta or any other customer to cancel the contract. This is a matter of law. It has already been tested is many courts. This clause is simply unenforcable.
You are pulling this one out of your arse! Most contracts contain an escape clause for mutual protection that gives contractual relief should either party become insolvent or in a financial condition that impacts the party's duties and the ability to perform those duties as prescribed in the contract. No contract or judge would legally bind a party to a boat anchor. A contract really means nothing--paper with words. It only means something when there is a dispute, major or minor, when one or the other party falls short of fullfilling it's duties, and the contractual terms and meaning is interpretated by a 3rd party.

I'm just guessing--but I would think, in this case, that the larger company has a larger artillery and or armada in the form of legal council plus DEEP pockets to wage a successful legal battle--most often called "Staying Power!"

Mesa will survive and flourish

Survive--maybe in the Bastions of China or Hawaii, but in small force. Even La CockaRoaches survive.

Flourish--to grow luxuriantly : thrive-- No Maas, Notta, Nil, or "Turn Out the Light, the Party's Over!" Even Frank Lorenzo was put out to pasture. Ba-Bye!

 

[DoinTime]

Sorry, you are wrong. These provisions are not enforcable and have no connection whatsoever to safety standards. Many airlines have filed for BK protection very few have ever had safety issues.

Bottom line is this. IF Mesa files for BK they can restructure under the protection of the court. That same court will never allow Delta or any other customer to cancel the contract. This is a matter of law. It has already been tested is many courts. This clause is simply unenforcable.

Mesa will survive and flourish

So you are saying these provisions that were explicitly written into Mesa's service agreement for this exact circumstance were just in there take up space? Hows it feel to think you are smarter on the subject of bankruptcy than all the lawyers that assembled this contract?

 

[Speedtape]

Sure they can. BK only gets you off the hook with your VENDORS and CREDITORS. It's a one-way street.
Pardna, those rules changed right after NWA and Delta filed for Bankruptcy--the coming change in laws was the causal effect of their bankruptcy. Under new laws, no one gets off the hook. The liability and duty to pay still remains for the whole amount. Now, terms may change, if the new type of Bankruptcy is ordered by the court. If they owe you a $100, they will still owe you a $100--no discounting or cancelling is allowed. Thank those changes to the Banking Industry and their Lobbyists.

It cannot force your CUSTOMERS to keep using you...especially if their contract specifically lets them off the hook if you file BK. It's a reasonable contractual provision since a BK regional airline cannot be expected to maintain safety standards.

?????whatcha mean, Verne???? Customers, in the loose sense, are never legally bound in a business relationship. Free to Come, Free to Go! However, if 2 parties enter into a contractual relationship, then that is a different situatation. But, I think I know what you be saying, and I'm down with it! Your safety standards argument is a huge issue in these matters, because it involves Government regulation, in addition to public and media perception. In this matter, from an FAA perspective, if Major Airline D contracts with Minor airline M, Minor airline M has to not only comply with it's own ceritifying requirements, but it also has to operate and meet most if not all requirements of Major Airline D, except those where differences are prescribed by regulation. Initial Certification as well On-going ceritification requirements are governed by "Fiscal Fitness Standards" that are regulated to certain high standards, and cannot be compromised without putting Certification at risk. Most of the time, when airlines start having known financial problems, they go on a "watch list" and all practices, especially Maintenance, come under more scrutinty and oversight by the FAA to make sure that Certification standards in all areas are still met.

 

[sniper]

Mesa ia not going to file and 10 more 700's are to be placed with UAL starting 9/10/10

 

[pdub20s]

Mesa ia not going to file and 10 more 700's are to be placed with UAL starting 9/10/10

Source?

 

[Broke in CVG]

Mesa ia not going to file and 10 more 700's are to be placed with UAL starting 9/10/10

Nope! They were UNABLE to obtain financing for the addition 700s.

 

[Metro752]

We need sources!

 

[Broke in CVG]

Bottom line is this. IF Mesa files for BK they can restructure under the protection of the court. That same court will never allow Delta or any other customer to cancel the contract. This is a matter of law. It has already been tested is many courts. This clause is simply unenforcable.

Mesa will survive and flourish

I can tell you for a fact that you are absolutely 100% wrong. The day that Mesa files, the Delta contract will be canceled and there is absolutely NO legal recourse Mesa has to prevent this.

 

[dowhite2]

They were only required by Oct 31st to provide UAL expected delivery dates of the additional 700s. Who is to say that hasn't happened?

 

[Broke in CVG]

They were only required by Oct 31st to provide UAL expected delivery dates of the additional 700s. Who is to say that hasn't happened?

It didn't they couldn't get the financing.