e6bpilot

It is serious, no doubt. Things ARE going to get way worse. The Easter "open for business" BS that Trump was hoping for has zero chance of happening.

The bright side to this is history. This is the first major pandemic in modern history, but not the first one in history. It will subside in a matter of weeks to months, and when it does, our economy will rebound. Airlines will see demand return, especially for domestic travel. Read about the 1918 flu pandemic and the resulting crisis. It was terrible, but for all the lack of knowledge about how viruses spread and how to treat them, we managed to get through it and continue to thrive.

Right now SWA is sitting on a pile of cash that it can burn through in the coming months. It is probably going to add to that cash. We are in an enviable position relative to most of the industry and are in the best position to recover.

I would be shocked if we lost any domestic employees that have SW employee numbers over this crisis.

Chief Brody

[QUOTE=e6bpilot;3014734]It is serious, no doubt. Things ARE going to get way worse. The Easter "open for business" BS that Trump was hoping for has zero chance of happening.

The bright side to this is history. This is the first major pandemic in modern history, but not the first one in history.

Do you not consider 1.4 billion infections and over 500,000 deaths a pandemic?? Or did your college professors not teach you about the Obama era failures?

Here this is free and you won't need another student loan to learn something .

https://en.wikipedia.org/wiki/2009_f..._United_States

e6bpilot

[QUOTE=Chief Brody;3014750]
Your quote to reply to my post did not work. It looks like one big post.
Are you triggered that I mentioned Trump? It wasn't political. As I have stated before, I am satisfied with his response to what is happening. I just think leaning forward to jump start the economy when the herd is still way spooked is a fool's errand. It will just put more people in danger. Contain the virus THEN stimulate the economy. That's how this works. Try to do one while doing the other is a waste of time.
Obama royally screwed up the 2008 recovery. The surgical approach does not work. Trump actually listening to the experts and carpet bombing the problem with government money IS the correct approach. He just can't keep his mouth shut when he should.
SARS, MERS, and swine flu (.02% mortality rate. Thanks for the article) were nothing compared to this bugger.
I was about 15 years into my career and traveling the world extensively in 2009-2010. Also, I have a technical degree. I just read books. But good try.

Chief Brody

[QUOTE=e6bpilot;3014778]So all that education, book reading and experience and you think this is the first pandemic in modern times?

DrJekyll MrHyde

I’m not trolling, but the rules for the grants and loans have been available in the Stimulus Bill. Let me share below. Please enjoy the light reading, I’ve tried to highlight the important language.

DrJekyll MrHyde

Stimulus Bill References to GRANT Money for Airlines:



SEC. 4112. PANDEMIC RELIEF FOR AVIATION WORKERS.

(a) FINANCIAL ASSISTANCE FOR EMPLOYEE WAGES, SALARIES, AND BENEFITS.—Notwithstanding any other provision of law, to preserve aviation jobs and compensate air carrier industry workers, the Secretary shall provide financial assistance that shall exclusively be used for the continuation of payment of employee wages, salaries, and benefits to—
(1) passenger air carriers, in an aggregate amount up to $25,000,000,000;
(2) cargo air carriers, in the aggregate amount
up to $4,000,000,000; and
(3) contractors, in an aggregate amount up to
$3,000,000,000.

(b) ADMINISTRATIVE EXPENSES.—Notwithstanding any other provision of law, the Secretary, may use $100,000,000 of the funds made available under section 4120(a) for costs and administrative expenses associated with providing financial assistance under this subtitle.

SEC. 4113. PROCEDURES FOR PROVIDING PAYROLL SUPPORT.

(a) AWARDABLE AMOUNTS.—The Secretary shall provide financial assistance under this subtitle—
(1) to an air carrier in an amount equal to the salaries and benefits reported by the air carrier to the Department of Transportation pursuant to part 241 of title 14, Code of Federal Regulations, for the period from April 1, 2019, through September 30, 2019; and
(2) to an air carrier that does not transmit re- ports under such part 241, in an amount that such air carrier certifies, using sworn financial statements or other appropriate data, as the amount of wages,salaries, benefits, and other compensation that such air carrier paid the employees of such air carrier during the period from April 1, 2019, through September 30, 2019; and
(3) to a contractor, in an amount that the contractor certifies, using sworn financial statements or other appropriate data, as the amount of wages, salaries, benefits, and other compensation that such contractor paid the employees of such contractor during the period from April 1, 2019, through September 30, 2019.

[Skipping Forward]

SEC. 4114. REQUIRED ASSURANCES.
5 (a) IN GENERAL.—To be eligible for financial assistance under this subtitle, an air carrier or contractor shall enter into an agreement with the Secretary, or otherwise certify in such form and manner as the Secretary shall prescribe, that the air carrier or contractor shall—
(1) refrain from conducting involuntary furloughs or reducing pay rates and benefits until September 30, 2020;
(2) through September 30, 2021, ensure that neither the air carrier or contractor nor any affiliate of the air carrier or contractor may, in any transaction, purchase an equity security of the air carrier or contractor or the parent company of the air carrier or contractor that is listed on a national securities exchange;
(3) through September 30, 2021, ensure that the air carrier or contractor shall not pay dividends, or make other capital distributions, with respect to the common stock (or equivalent interest) of the air carrier or contractor; and (4) meet the requirements of sections 4115 and 4116.





(b) DEPARTMENT OF TRANSPORTATION AUTHORITY TO CONDITION ASSISTANCE ON CONTINUATION OF SERVICE.—
(1) IN GENERAL.—The Secretary of Transportation is authorized to require, to the extent reasonable and practicable, an air carrier provided financial assistance under this subtitle to maintain scheduled air transportation service, as the Secretary of Transportation deems necessary, to ensure services to any point served by that carrier before March 1,
13 2020.
(2) REQUIRED CONSIDERATIONS.—When considering whether to exercise the authority provided by this section, the Secretary of Transportation shall take into consideration the air transportation needs of small and remote communities and the need to maintain well-functioning health care supply chains, including medical devices and supplies, and pharmaceutical supply chains.
(3) SUNSET.—The authority provided under this subsection shall terminate on March 1, 2022, and any requirements issued by the Secretary of Transportation under this subsection shall cease to
apply after that date.





SEC. 4115. PROTECTION OF COLLECTIVE BARGAINING AGREEMENT.
(a) IN GENERAL.—Neither the Secretary, nor any other actor, department, or agency of the Federal Government, shall condition the issuance of financial assistance under this subtitle on an air carrier’s or contractor’s im- plementation of measures to enter into negotiations with the certified bargaining representative of a craft or class of employees of the air carrier or contractor under the Railway Labor Act (45 U.S.C. 151 et seq.) or the National Labor Relations Act (29 U.S.C. 151 et seq.), regarding pay or other terms and conditions of employment.
(b) PERIOD OF EFFECT.—With respect to an air car- rier or contractor to which financial assistance is provided under this subtitle, this section shall be in effect with re- spect to the air carrier or contractor beginning on the date on which the air carrier or contractor is first issued such financial assistance and ending on September 30, 2020.

SEC. 4116. LIMITATION ON CERTAIN EMPLOYEE COMPENSATION.
(a) IN GENERAL.—The Secretary may only provide financial assistance under this subtitle to an air carrier or contractor after such carrier or contractor enters into an agreement with the Secretary which provides that, during the 2-year period beginning March 24, 2020, and ending March 24, 2022, no officer or employee of the air carrier or contractor whose total compensation exceeded $425,000 in calendar year 2019 (other than an employee whose compensation is determined through an existing collective bargaining agreement entered into prior to enactment of this Act)—
(1) will receive from the air carrier or contractor total compensation which exceeds, during
any 12 consecutive months of such 2-year period, the total compensation received by the officer or employee from the air carrier or contractor in calendar year 2019;
(2) will receive from the air carrier or contractor severance pay or other benefits upon termination of employment with the air carrier or contractor which exceeds twice the maximum total compensation received by the officer or employee from the air carrier or contractor in calendar year 2019;
and
(3) no officer or employee of the eligible business whose total compensation exceeded $3,000,000 in calendar year 2019 may receive during any 12 consecutive months of such period total compensation in excess of the sum of—
(A) $3,000,000; and
(B) 50 percent of the excess over $3,000,000 of the total compensation received by the officer or employee from the eligible business in calendar year 2019.
(b) TOTAL COMPENSATION DEFINED.—In this sec- tion, the term ‘‘total compensation’’ includes salary, bo- nuses, awards of stock, and other financial benefits pro- vided by an air carrier or contractor to an officer or em- ployee of the air carrier or contractor.





{THIS IS WHERE GRANT CASH FOR EQUITY IS DISCUSSED}



SEC. 4117. TAX PAYER PROTECTION.
The Secretary may receive warrants, options, pre- ferred stock, debt securities, notes, or other financial in- struments issued by recipients of financial assistance under this subtitle which, in the sole determination of the Secretary, provide appropriate compensation to the Fed- eral Government for the provision of the financial assistance.

DrJekyll MrHyde

Stimulus Bill References to LOANS for Airlines:



SEC. 4003. EMERGENCY RELIEF AND TAXPAYER PROTECTIONS.
(a) IN GENERAL.—Notwithstanding any other provision of law, to provide liquidity to eligible businesses, States, and municipalities related to losses incurred as a result of coronavirus, the Secretary is authorized to make loans, loan guarantees, and other investments in support of eligible businesses, States, and municipalities that do not, in the aggregate, exceed $500,000,000,000 and provide the subsidy amounts necessary for such loans, loan guarantees, and other investments in accordance with the provisions of the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et seq.).

(b) LOANS, LOAN GUARANTEES, AND OTHER INVESTMENTS.—
Loans, loan guarantees, and other investments made pursuant to subsection (a) shall be made available as follows:
(1) Not more than $25,000,000,000 shall be available to make loans and loan guarantees for passenger air carriers, eligible businesses that are certified under part 145 of title 14, Code of Federal Regulations, and approved to perform inspection, repair, replace, or overhaul services, and ticket agents(as defined in section 40102 of title 49, United

12 States Code).
(2) Not more than $4,000,000,000 shall be available to make loans and loan guarantees for cargo air carriers.
(3) Not more than $17,000,000,000 shall be available to make loans and loan guarantees for businesses critical to maintaining national security.
(4) Not more than the sum of $454,000,000,000 and any amounts available under paragraphs (1), (2), and (3) that are not used as provided under those paragraphs shall be available to make loans and loan guarantees to, and other investments in, programs or facilities established by the Board of Governors of the Federal Reserve System for the purpose of providing liquidity to the financial system that supports lending to eligible businesses, States, or municipalities by—
(A) purchasing obligations or other interests directly from issuers of such obligations or other interests;
(B) purchasing obligations or other interests in secondary markets or otherwise; or
(C) making loans, including loans or other
advances secured by collateral.
(c) TERMS AND CONDITIONS.—
(1) IN GENERAL.—
(A) FORMS; TERMS AND CONDITIONS.—A loan, loan guarantee, or other investment by the Secretary shall be made under this section in such form and on such terms and conditions
and contain such covenants, representations, warranties, and requirements (including requirements for audits) as the Secretary determines appropriate. Any loans made by the Secretary under this section shall be at a rate determined by the Secretary based on the risk and the current average yield on outstanding marketable obligations of the United States of comparable maturity.

{Skipping over Procedures section}


(2) LOANS AND LOAN GUARANTEES .—The Secretary may enter into agreements to make loans or loan guarantees to 1 or more eligible businesses under paragraphs (1), (2) and (3) of subsection (b) if the Secretary determines that, in the Secretary’s discretion—
(A) the applicant is an eligible business for which credit is not reasonably available at the time of the transaction;
(B) the intended obligation by the applicant is prudently incurred;
(C) the loan or loan guarantee is sufficiently secured or is made at a rate that reflects the risk of the loan or loan guarantee; and
(ii) is to the extent practicable, not
less than an interest rate based on market
conditions for comparable obligations prevalent prior to the outbreak of the coronavirus disease 2019 (COVID–19);
(D) the duration of the loan or loan guarantee is as short as practicable and in any case not longer than 5 years;
(E) the agreement provides that, until the
date 12 months after the date the loan or loan guarantee is no longer outstanding, neither the eligible business nor any affiliate of the eligible business may purchase an equity security that
is listed on a national securities exchange of the eligible business or any parent company of the eligible business, except to the extent required under a contractual obligation in effect as of the date of enactment of this Act;
(F) the agreement provides that, until the
date 12 months after the date the loan or loan guarantee is no longer outstanding, the eligible business shall not pay dividends or make other
capital distributions with respect to the common stock of the eligible business;

(G) the agreement provides that, until September 30, 2020, the eligible business shall maintain its employment levels as of March 24, 2020, to the extent practicable, and in any case shall not reduce its employment levels by more than 10 percent from the levels on such date;

(H) the agreement includes a certification by the eligible business that it is created or organized in the United States or under the laws of the United States and has significant operations in and a majority of its employees based in the United States; and
(I) for purposes of a loan or loan guar- antee under paragraphs (1), (2), and (3) of subsection (b), the eligible business must have incurred or is expected to incur covered losses such that the continued operations of the business are jeopardized, as determined by the Secretary.



{THIS SECTION DETAILS COLLATERAL REQUIRED FOR ALL LOANS, i.e. not at the discretion of Secretary Mnuchin}



FINANCIAL PROTECTION OF GOVERNMENT.—
(1) WARRANT OR SENIOR DEBT INSTRUMENT.—
The Secretary may not issue a loan to, or a loan guarantee for, an eligible business under paragraph (1), (2), or (3) of subsection (b) unless—
(A) (i) the eligible business has issued securities that are traded on a national securities exchange; and
(ii) the Secretary receives a warrant or equity interest in the eligible business; or


(B) in the case of any eligible business other than an eligible business described in sub- paragraph (A), the Secretary receives, in the discretion of the Secretary—
(i) a warrant or equity interest in the eligible business; or
(ii) a senior debt instrument issued by the eligible business.

e6bpilot

[QUOTE=Chief Brody;3014796]
Sorry, Chief. Thanks for the correction. Gold star for you. This is the first one even close to this scale, but I suspect you knew that. Swine flu is a favorite talking point of the deep state conspiracy crowd because of its timing and relative lack of coverage by the press. That is why I framed my response like I did. Is that where you are going with this or did you just want to correct me?

This was a discussion about SWA taking bailout money and the possibility of furloughs. Even though this is the WORST pandemic in modern times, I don't think they will. Do you have an opinion on the matter? I would love to discuss it with you.

rickair7777

Any airline will analyze the deal before taking the cheese (bait).

Some (AA/DL) probably have to take it to survive short-term.

I doubt anyone will pass up the grants over the no-acquisition clause, right now is not the time for M&A anyway (that could very well change in a year).

The biggest issue with the grants (which have the no furlough clause) is how much does it cost you to carry staff to 01 Oct vs. how much grant will you get?

If you carrying staff costs more than the grant value, resulting in a net lower cash position on Oct 01, then you have to seriously consider no grant and mass furlough. That's the accounant-preferred COA.

You could keep the staff and take a risk on having less cash on Oct 01 IF you think demand will rebound and you'll need or at least be able to gainfully employ the staff after Oct 01. Obvious risk there is nobody knows where the economy and travel restrictions will stand.

It sounds like AS has committed to taking the cash and keeping the staff, they're about the closest comparison to SW.

flysnoopy76

Alaska is most likely taking the grant money but are already planning to furlough on October 1.