AMR files plan and disclosure statement based on US Airways merger

By Caroline Salls

Pittsburgh, April 16 - AMR Corp. filed its plan of reorganization and related disclosure statement Monday with the U.S. Bankruptcy Court for the Southern District of New York.

The company said the plan will be implemented in conjunction with the completion of the previously announced merger with US Airways Group, Inc.

Treatment of creditors under the proposed plan will include the following:

• Administrative expense claims, priority tax claims and priority non-tax claims will be paid in full in cash;

• Holders of secured claims will either be paid in full in cash, receive the proceeds of the sale of the collateral securing their claims or receive the collateral;

• Holders of general unsecured guaranteed claims will receive a number of shares of new mandatorily convertible preferred stock equal to the quotient of the claim's share of a double-dip full recovery amount divided by the per share initial stated value;

• Holders of other general unsecured claims will receive its initial share of a number of shares of new mandatorily convertible preferred stock equal to the quotient of the total initial stated value, less the double-dip full recovery amount, divided by the per share initial stated value, as well as its initial share of a number of shares of new common stock equal to a creditor new common stock allocation, less the number of shares of new common stock issued on conversion of all of the shares of the preferred stock, less a labor common stock allocation;

• Holders of AMR equity interests will receive a share of an initial old equity allocation and a market-based old equity allocation;

• AMR other equity interests, American Airlines equity interests and American Eagle equity interests will be reinstated for the benefit of the reorganized debtor holding those interests;

• Holders of American Airlines union claims will receive a share of new common stock in the reorganized company, with the Allied Pilots Association receiving 13.5% of the new common stock allocation, the Association of Professional Flight Attendants receiving 3% and the Transport Workers Union of America, AFL-CIO receiving 4.8%; and

• Holders of American Airlines and American Eagle convenience claims will be paid in full in cash, provided, however, that the total amount to be paid to convenience class claimants will be $25 million.

The disclosure statement hearing is scheduled for May 30.

AMR Corp., the Fort Worth, Texas-based parent of American Airlines, filed for bankruptcy on Nov. 29, 2011. Its Chapter 11 case number is 11-15463.

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