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Why PinColaba Won't Declare BK til after May
People are freaking out about 9E declaring bankruptcy. Whether these rumors are being stoked by penny stock daytraders or company men trying to elicit concessions, there are very sound legal reasons to assume the company will not declare any bankruptcy until May 25th, 2012, or later.
Disclaimer: I am not a lawyer. If you need legal advice, contact a licensed attorney. This is not to be constituted as legal advice. When a corporation declares Chapter 11 or Chapter 7, the bankruptcy court (and especially the company's creditors) will immediately begin hunting for "avoidable transfers" and "fradulent transfers." The court will review any payments or agreements-to-pay made 90 days or less prior to the BK filing. For payment agreements with former company directors, this time period is extended to 1 year pre-bankruptcy filing. Any payment agreements or payments made in the 90 day period prior to the BK filing (or 1 year period for former/current directors like Phil Trenary) are considered avoidable transfers. In the eyes of the law, these transfers are construed as giving the beneficiaries unfair priority over other creditors. As such, the judge voids these agreements, and any assets/cash paid will be seized as property of the bankruptcy estate/trustee. What I'm highlighting here is that, if Pinnacle declares BK before May of next year, Phil's big fat consulting fee arrangement would very likely be considered an avoidable transfer to a former director in the year leading up to a BK filing. I have a very strong feeling that Pinnacle will not declare BK until a year has passed since Phil's payment arrangement/golden parachute deal was signed. This, of course, assumes that Phil has not performed a Michael Jackson/Bank of America stunt and placed the monies in a Cook Islands Trust, held in the name of a Nevis LLC, held in the name of a Wyoming LLC. :D |
Wake up, Pinnacle will be declaring bankruptcy sooner than that!
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Originally Posted by flapshalfspeed
(Post 1104276)
People are freaking out about 9E declaring bankruptcy. Whether these rumors are being stoked by penny stock daytraders or company men trying to elicit concessions, there are very sound legal reasons to assume the company will not declare any bankruptcy until May 25th, 2012, or later.
Disclaimer: I am not a lawyer. If you need legal advice, contact a licensed attorney. This is not to be constituted as legal advice. When a corporation declares Chapter 11 or Chapter 7, the bankruptcy court (and especially the company's creditors) will immediately begin hunting for "avoidable transfers" and "fradulent transfers." The court will review any payments or agreements-to-pay made 90 days or less prior to the BK filing. For payment agreements with former company directors, this time period is extended to 1 year pre-bankruptcy filing. Any payment agreements or payments made in the 90 day period prior to the BK filing (or 1 year period for former/current directors like Phil Trenary) are considered avoidable transfers. In the eyes of the law, these transfers are construed as giving the beneficiaries unfair priority over other creditors. As such, the judge voids these agreements, and any assets/cash paid will be seized as property of the bankruptcy estate/trustee. What I'm highlighting here is that, if Pinnacle declares BK before May of next year, Phil's big fat consulting fee arrangement would very likely be considered an avoidable transfer to a former director in the year leading up to a BK filing. I have a very strong feeling that Pinnacle will not declare BK until a year has passed since Phil's payment arrangement/golden parachute deal was signed. This, of course, assumes that Phil has not performed a Michael Jackson/Bank of America stunt and placed the monies in a Cook Islands Trust, held in the name of a Nevis LLC, held in the name of a Wyoming LLC. :D The stock is at 96 cents and with sell orders being pushed it could spell trouble sooner then May... more like JAN or FEB... well shall see! Who knows. |
Originally Posted by ShyGuy
(Post 1104281)
Wake up, Pinnacle will be declaring bankruptcy sooner than that!
Unless you can point to a significant liability that will push the company's assets v. liabilities into the red, your fearmongering is not backed up by reality. If you can show me, on paper, the specific projected cash outflows that will equalize Pinnacle's assets and liabilities in the next 90 days, I will consider the merits of your claim. Vice any sort of information leading you to your conclusions, you're no more than a fortune teller who is probably trying to make a buck daytrading the stock. |
What does the board and the current team owe PT, DS, et al anyway? If anything, I think they'd be more interested in going after their money due to the fact that they took a big sh*t in the toilet and forgot to flush before they left.
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Tea beggars:
Pinnacle Has ‘High Probability’ of Bankruptcy, Maxim Says - Businessweek Not the have any faith in an analyst... |
Originally Posted by B00sted
(Post 1104366)
Tea beggars:
Pinnacle Has ‘High Probability’ of Bankruptcy, Maxim Says - Businessweek Not the have any faith in an analyst... http://www.commercialappeal.com/news...rs-memphis-be/ |
Menke lead Frontier through BK. He will lead 9E through it as well it looks like.
The BOD obviously had this planned out. |
Originally Posted by B00sted
(Post 1104399)
Menke lead Frontier through BK. He will lead 9E through it as well it looks like.
The BOD obviously had this planned out. Its hard to say what sort of result F9 would have had if they'd been left to finish their own restructuring. |
Originally Posted by B00sted
(Post 1104366)
Tea beggars:
Pinnacle Has ‘High Probability’ of Bankruptcy, Maxim Says - Businessweek Not the have any faith in an analyst... The company is obviously waging a PR campaign to spread fear amongst the pilots and at Daddy Delta. If they can successfully get training and pay concessions from the pilots, and if they can successfully get things squared away with Delta, their "house is burning down" campaign will have paid off. On another note--do you guys honestly think the consultants they hired to develop BK/liquidity improvement plans are going to finish their work before Xmas, get a bankruptcy filing in, and enter Chapter 11 before New Year's? I highly doubt it--that's a pretty tight timeline, even for a mid-sized company. My best guess: if they do declare BK, it won't be until March at the earliest, if at all. At the end of the day, we owe all of this to our collective greed as a society--many of us Americans have shot ourselves in the foot looking out for the guy in the mirror so many times via concessions, voting for candidates based on what's best for us and not the whole country, and buying so much crap we don't need that we force ourselves into working for employers we would've otherwise walked away from years ago. Either way...good luck to all of us whatever happens... |
Full pay until the last day. Call Their Bluff. Lots of other pilot groups have taken cuts, only to take more in BK. F-that. It's our combined company and our combined future. No cuts, period. None.
No Concessions. None |
Jan 1, 2012. Either the wage concessions are in, or 9E will declare BK. It's sickeningly simple.
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Originally Posted by ShyGuy
(Post 1104638)
Jan 1, 2012. Either the wage concessions are in, or 9E will declare BK. It's sickeningly simple.
Didn't they just sign a contract with the FA's and give them a large bonus? Now they want concessions.... |
Originally Posted by flapshalfspeed
(Post 1104341)
If you can show me, on paper, the specific projected cash outflows that will equalize Pinnacle's assets and liabilities in the next 90 days, I will consider the merits of your claim. Vice any sort of information leading you to your conclusions, you're no more than a fortune teller who is probably trying to make a buck daytrading the stock.
You know shy never lets little facts like balance sheets, cash flows, and liquidity get in the way of a good fear mongering statement....geez..... |
Originally Posted by ShyGuy
(Post 1104638)
Jan 1, 2012. Either the wage concessions are in, or 9E will declare BK. It's sickeningly simple.
Wage concessions of a measly 5% is what makes or breaks PNCL's solvency? |
Originally Posted by flapshalfspeed
(Post 1104276)
What I'm highlighting here is that, if Pinnacle declares BK before May of next year, Phil's big fat consulting fee arrangement would very likely be considered an avoidable transfer to a former director in the year leading up to a BK filing.
I have a very strong feeling that Pinnacle will not declare BK until a year has passed since Phil's payment arrangement/golden parachute deal was signed. This, of course, assumes that Phil has not performed a Michael Jackson/Bank of America stunt and placed the monies in a Cook Islands Trust, held in the name of a Nevis LLC, held in the name of a Wyoming LLC. :D |
Pinnacle doesn't need to declare bankruptcy. They are going through a bunch of ONE time costs associated with this mega merger. Notably training AND millions in bonuses paid to departing executives.
Is your airline operationally profitable? Yes I believe it is. What has happened is Pinnacle isn't making as much profits as it has in the past and that will upset Wall Street since they always want increasing profits. The only way increasing profits will happen for a regional now is through cutting costs and the only real easily controllable cost is labor. They can try and renegotiate some leases but labor is and always has been the easiest target. Don't give in to them because in two maybe three quarters time Pinnacle will be net profitable again regardless of your concessions. You just spent 10 years fighting for this contract, don't roll over now. Every merger goes through these one time costs of integration. Delta/Northwest did and United/Continental is right now. Hundreds of millions of dollars are spent on these one time costs the difference for a company like United is that they are also generating more revenue which they can point out to Wall Street and say, "Yes our costs are high right now due to the merger expenses but our revenues have also grown." Pinnacle doesn't have that luxury since it's revenues come from FFD contracts. There is no growth opportunity outside of securing more flying. Sean Menke is trying to protect his job right now but in reality your company will be fine with in a year after the merger sorts itself out. Let Menke sweat it out with Wall Street, don't take money out of your pockets to make his job easier. Make him earn the ridiculous bonus he will likely reward himself when this is all done with. |
Originally Posted by FlyingKat
(Post 1104684)
Flaps,
You know shy never lets little facts like balance sheets, cash flows, and liquidity get in the way of a good fear mongering statement....geez..... |
Originally Posted by ShyGuy
(Post 1104848)
Your tone will change once Delta reneges on our training reimbursement.
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Originally Posted by aviatorpr
(Post 1104881)
Is the training reimbursement language in the sale/purchase agreement of XJ last year?
************************************************** *********************************** Outlook New Collective Bargaining Agreement with the Air Line Pilots Association We entered into a joint collective bargaining agreement with the Air Line Pilots Association (“ALPA”) during February 2011 covering the pilots at all three of our operating subsidiaries. The new agreement contains substantial salary and benefits increases for our pilots, bringing their total compensation in line with the average for airlines with similarly sized aircraft. As a result, for the three and nine months ended September 30, 2011, the new agreement increased our salaries, wages and benefits costs by approximately $4.9 million and $13.7 million, respectively, and we expect our total pilot costs to increase by approximately $19 million for the full year 2011. In connection with our acquisition of Mesaba, we modified our existing capacity purchase agreements with Delta to provide for a rate adjustment that is designed to increase our rates under all of our capacity purchase agreements with Delta commensurate with the increase in pilot labor costs related to our Delta operations. The rate adjustment will be calculated and agreed to by us and Delta 12 months after Pinnacle’s and Mesaba’s pilots are covered under a joint collective bargaining agreement, which occurred in February 2011. As part of the rate adjustment, we will receive a one-time retroactive payment related to the prior 12 months for the increase in our pilot costs, inclusive of training and displacement related to the merging of Pinnacle’s and Mesaba’s jet operations. In addition, we will receive a prospective adjustment payable for future periods such that our rates pertaining to pilot costs will be approximately equivalent to our actual pilot costs at the time of the rate adjustment. While we will not receive any cash payments related to these adjustments from Delta until 2012, we currently estimate that the one-time retroactive adjustment related to the 12 months ending March 2012 could be as much as $18 million to $20 million, and the prospective rate increase that would begin in March 2012 could be as much as $14 million to $17 million annually. No assurances can be made that the amount of the rate adjustments ultimately agreed to with Delta will equal our current estimates. We have not recorded any revenue associated with these rate adjustments in 2011, and we do not expect to recognize any of this revenue until 2012 upon the final determination of the amount with Delta. *********************************************** In other words, hopes and dreams. It's like how I estimated every pilot would receive a pony as part of the new JCBA, but "no assurances can be made that the amount of ponies, if any, will equal our current estimates." |
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Shy, you might want to read what you bolded again.
Then again. Then a fourth time. Maybe then you'll see what the 10-Q statements you bolded actually say, and not what you THINK they say. One time adjustment that MIGHT be as high as 18-20M. Annual rate adjustment starting March 2012 that MIGHT be as high as 14-17M. While those aren't firm numbers and ultimate payments may not be as high as PNCL "estimated", absolutely nowhere does it say Delta can renig on those agreements. I don't have any skin in the PNCL game, but what's your objective spreading FUD? |
Originally Posted by BoilerUP
(Post 1104900)
Shy, you might want to read what you bolded again.
Then again. Then a fourth time. Maybe then you'll see what the 10-Q statements you bolded actually say, and not what you THINK they say. One time adjustment that MIGHT be as high as 18-20M. Annual rate adjustment starting March 2012 that MIGHT be as high as 14-17M. While those aren't firm numbers and ultimate payments may not be as high as PNCL "estimated", absolutely nowhere does it say Delta can renig on those agreements. I don't have any skin in the PNCL game, but what's your objective spreading FUD? Delta can reneg on them, too. Pinnacle and Delta agreed on rates for the aircraft we lease from them a while ago. Now, Menke is fighting tooth and nail on an agreement that as far as Delta is concerned, was already agreed upon. Now they're looking for a change. |
Originally Posted by flapshalfspeed
(Post 1104465)
Just to play Devil's Advocate (a role I feel myself being drug into on these boards regarding this matter)-- Funny how the above mentioned analyst only began following Pinnacle the day he released this article.
The company is obviously waging a PR campaign to spread fear amongst the pilots and at Daddy Delta. If they can successfully get training and pay concessions from the pilots, and if they can successfully get things squared away with Delta, their "house is burning down" campaign will have paid off. On another note--do you guys honestly think the consultants they hired to develop BK/liquidity improvement plans are going to finish their work before Xmas, get a bankruptcy filing in, and enter Chapter 11 before New Year's? I highly doubt it--that's a pretty tight timeline, even for a mid-sized company. My best guess: if they do declare BK, it won't be until March at the earliest, if at all. At the end of the day, we owe all of this to our collective greed as a society--many of us Americans have shot ourselves in the foot looking out for the guy in the mirror so many times via concessions, voting for candidates based on what's best for us and not the whole country, and buying so much crap we don't need that we force ourselves into working for employers we would've otherwise walked away from years ago. Either way...good luck to all of us whatever happens... Sidenote: is our ASA with Delta published and can it be accessed by anyone? |
Originally Posted by MunkyButtr
(Post 1105905)
You seem to be doing some research, so I have a question, but not the time to find it myself. How many companies that hired Seabury actually filed for and were granted chapter 11 protection?
Sidenote: is our ASA with Delta published and can it be accessed by anyone? Seabury Group: Wage Slashers: Seabury Group | Wage Slasher Excerpt: "Better than that, he has exploited the downturn to extract unprecedented concessions, especially from pilots. Within a month of taking over last March, Siegel was able to persuade union leaders that, on its then-current course, the airline would run through $1 billion in cash within 12 months and probably find no lender willing to provide more. "The unions were shocked," says John Luth, a financial adviser to the airline. "No one had put it in these terms before." |
MEM will ask us for the 5%, we say No, then BK ensues - end of story.
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I guess I was wrong--after MARCH...not May...but Phildo's agreement was signed in late March, so pretty sure his money is safe.
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Originally Posted by flapshalfspeed
(Post 1163339)
I guess I was wrong--after MARCH...not May...but Phildo's agreement was signed in late March, so pretty sure his money is safe.
"The Former Officer Agreements. The Debtor hereby seek to reject the Consulting Agreement (the “Trenary Agreement”) dated March 10, 2011 between Pinnacle Holdings and Philip H. Trenary (“Trenary”) and the Release Agreement (the “Shockey Agreement” and together with the Trenary Agreement, the “Former Officer Agreements”) dated October 19, 2011 between Pinnacle Holdings and Douglas W. Shockey (“Shockey”), in each case effective as of the Petition Date. Pursuant to the Officer Agreements, the Debtors pay Trenary for consulting services and Shockey for non-revocation of a release signed concurrently with the Shockey Agreement. The Debtors are eager to use these chapter 11 proceedings to maximize value for all stakeholders and emerge as stronger businesses. After analyzing the Officer Agreements, the Debtors have determined, in the sound exercise of their business judgment, that rejecting the Former Officer Agreements would benefit the Debtors’ estates by allowing the Debtors to avoid accruing ongoing payment obligations under the Former Officer Agreements, which provide no ongoing benefit to the Debtors’ estates. The Debtors estimate that the total savings from rejecting the Officer Agreements will exceed $1,500,000." |
Imagine the debtors' benefit if they never hired those jackholes to begin with.
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He can easily keep any money that was actually paid prior to April 2nd, 2011. If he had somehow seen this coming, and if he were really smart he would've sold off his forward-looking payments to a third party annuity provider such as AIG (but he must not have or that third party's name would be on the docket--not Phil himself).
Anyone know what the disbursement schedule for his payments was? |
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