United owes AirWis a big payment?

[vc10]

One thing I heard recently is that if United dumps Air Wisconsin it would owe AirWis a large payment. Anyone else hear this?

 

[Rottweiller]

One thing I heard recently is that if United dumps Air Wisconsin it would owe AirWis a large payment. Anyone else hear this?

Yes there is quite a large "hurt me" clause in our agreement with UAL plus a bunch of monies held in escrow for AWAC - if UA keep AWAC they get the escrow money, if they don't AWAC get the escrow monies currently high 3 figures millions.

 

[WhiteCloud]

Yes there is quite a large "hurt me" clause in our agreement with UAL plus a bunch of monies held in escrow for AWAC - if UA keep AWAC they get the escrow money, if they don't AWAC get the escrow monies currently high 3 figures millions.

More interesting stuff. Would that number happen to be 125M? More?

 

[Rottweiller]

More interesting stuff. Would that number happen to be 125M? More?

As of a couple of months ago it was far more than $125M - try double. So it would appear that the USAir money is just pocket change and spare whichever way the UA deal goes.

 

[generaltso]

Couldn't a BK judge just throw out the contract that involves this penalty? Seems the popular thing to do these days.

 

[Rottweiller]

Couldn't a BK judge just throw out the contract that involves this penalty? Seems the popular thing to do these days.

They were the ones that approved it over a year ago and the money was (and still is being) placed in escrow to avoid such a thing.

 

[ILLINI]

This $125 million is not the money that United has been paying AWAC. There are certain conditions where this money would belong to AWAC, none of which have occured yet. The size of this account is only known by a very few people, and i'm sure those people wouldn't be talking about it.

 

[AWACoff]

How would a person know exactly how much money is in this escrow account? I am on the Pilot 2 Pilot comittee and I have no clue what you are talking about when you mention "high 3 figures millions". Where are you getting your information from? Post the info on the Air Wisconsin only web site if you don't want to post it on this public forum.

 

[DirkkDiggler]

I know we can't spend the money in the escrow account right now because technically it's United's money until they dump us sort of thing. But essentially if United dumps us, we'd be able to keep the money and it seems that there's at least enough in there to cover our purchase of $125 million of US Airways which will turn into stock (once out of bankruptcy). Isn't it ironic that we could essentially use United's money to purchase part of their competitor!

 

[Habib]

Is there anyway that AWAC is going to be staying with UAL?

If the UAIR thing works out, would it not be the same thing as Delta getting rid of FLYI/ ACA ?

What major wants to help another major.

I know Star Alliance, but come on?

 

[J32driver]

Is there anyway that AWAC is going to be staying with UAL?

If the UAIR thing works out, would it not be the same thing as Delta getting rid of FLYI/ ACA ?

What major wants to help another major.

I know Star Alliance, but come on?

Yes. There is still a very good chance that UAL will award AWAC the flying. USAirways needs cash. They proably don't really care where it comes from. Another consideration... UAL may still want to consolidate with Airways. Since a bankrupt company can't make an aquisition... you get someone else to do it for you. The legal stuff says that AWAC will own between 19% and 25% of USairways stock if the judge approves the deal.

Aren't conspiracy theories great!!!

 

[BAe3100FO]

Is there anyway that AWAC is going to be staying with UAL?

If the UAIR thing works out, would it not be the same thing as Delta getting rid of FLYI/ ACA ?

What major wants to help another major.

I know Star Alliance, but come on?

Uhmm, hello....
How many other carriers out there have express/connection parnters who fly for more than just ONE airline? So why is it that UNITED just won't allow AWAC to fly for USAIR?

 

[N4niner206]

Uhmm, hello....
How many other carriers out there have express/connection parnters who fly for more than just ONE airline? So why is it that UNITED just won't allow AWAC to fly for USAIR?

I may be wrong, but I don't think UA is the issue. I think the loan was a way of securing that USAirways would allow them to fly feed for them. Loan money in exchange for the option to fly for Airways if needed. Im sure they could do this even if the UA contract was all fine and dandy... though there probably would not be any reason to.