Join The Discussion

 

Ice cancels flights, snarls traffic; snow in North Texas forecast

DALLAS (AP) — More wintry weather was expected across parts of North Texas through Wednesday.

read more >

Berkshire Hathaway company acquires Fort Worth firm

M&M Manufacturing, a producer of sheet metal products for the air distribution and ventilation market based in Fort Worth, has been acquired by MiTek Industries Inc., a subsidiary of Warren Buffett’s Berkshire Hathaway Inc.,

read more >

Plans for Grand Prairie indoor ski resort, Hard Rock Hotel evaporate

Plans for a $215 million indoor ski resort and Hard Rock Hotel in Grand Prairie have been shelved. Sherman Thurston, a member of the development team, sent a

read more >

UPDATE: Six candidates file for two Water Board seats

Six candidates have filed for the two open seats on the Tarrant Regional Water Board, setting up a battle that could potentially shift the balance of power on the board and the priorities of one of the largest water districts in Texas.

read more >

Top area CFOs honored

The Fort Worth Business Press honored 13 area chief financial officers today with a luncheon at the Fort Worth Club.

read more >

 

Trustee opposes $20M payout to American Air CEO

 

JOSHUA FREED,AP Airlines Writer


The Justice Department is objecting to a proposed $20 million severance payment for American Airlines CEO Tom Horton, saying it's bigger than allowed by bankruptcy law.

Horton became CEO when American filed for Chapter 11 protection in November 2011. The proposed merger of US Airways Group Inc. and American calls for Horton to lose that job and become chairman of the combined company. American has proposed giving him severance pay of almost $20 million and lifetime flight benefits.

The objection filed Friday by the U.S. trustee's office says bankruptcy law caps such payments, even if they are agreed to in bankruptcy court but not made until the company exits bankruptcy protection. Bankruptcy law limits severance payments to executives and aims to make sure companies can repay as much of their debt as possible.

The objection also says previous company filings showed that Horton would get a maximum of $6.4 million if he had left at the end of last year, and raises the question of why he should get so much more money now. American has said in filings that the money for Horton is in recognition of his efforts during the airline's restructuring and his role in overseeing the merger with US Airways.

The trustee's objection also says American should be required to explain how its board determined that $20 million was the right amount for Horton, and to say whether independent directors approved of the payment.

The trustee's office is part of the Justice Department. Its job is to review bankruptcy cases to make sure bankruptcy laws are being enforced.

A written statement from American said it does not "expect any delay in the approval of the Disclosure Statement or voting on the Plan of Reorganization," which the company said is supported by the committee of unsecured creditors.

The case is in federal bankruptcy court in New York. Judge Sean Lane had previously rejected the same payment for Horton, but he left the door open for American to propose the payment in its reorganization plan, which it has done.

The trustee's objection is set to be heard in bankruptcy court on June 4.
 

< back

Email   email
hide
Catch
How 'bout them Cowboys?