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rocco2 Here is where they talk about the shares in excess of the cap. Can you explain this to me. It sounds like they have some effect on our distributions.
1.148 Market-Based Old Equity Allocation means, with respect to any
Mandatory Conversion Date, the aggregate number of shares of New Common
Stock that New AAG shall ratably distribute (or reserve for distribution) to the
holders of Allowed AMR Equity Interests on such Mandatory Conversion Date,
or as soon thereafter as reasonably practicable, in an aggregate amount equal to (i)
the product of (a) 25% of the difference between the New Common Stock
Allocation and the Initial Old Equity Allocation, multiplied by (b) the amount (if
any) by which the VWAP for such Mandatory Conversion Date exceeds the
Value Hurdle Price, all as multiplied by (c) the reciprocal of such VWAP, less (ii)
the Shares in Excess of Cap for such Mandatory Conversion Date; provided,
however, that in no event shall the number of shares distributed and/or reserved as
described in this Section 1.148 with respect to any Mandatory Conversion Date
(x) be less than zero or (y) be equal to or greater than the number of shares that
result in the aggregate number of shares of New Common Stock that are issuable
pursuant to the Plan, including those that are or may become issuable upon
conversion of shares of New Mandatorily Convertible Preferred Stock issued
under the Plan, exceeding the Maximum Plan Shares.
1.204 Shares in Excess of Cap means, with respect to any Mandatory
Conversion Date, a number of shares of New Common Stock equal to the sum of
the Mandatory Shares in Excess of Cap and the Optional Shares in Excess of Cap.
“Conversion Price” means, with respect to any Conversion Date, an amount equal to
96.5% of the VWAP calculated with respect to such Conversion Date; provided, however, that
such amount shall not be less than the Conversion Price Floor nor greater than the Conversion
Price Cap.
“Conversion Price Cap” means the greater of (i) $19.00 and (ii) the Initial VWAP less the
Conversion Price Floor plus the Initial VWAP, subject to adjustment as set forth in Section 6.1.3
On CNBC today.
Google "Top airline picks: UAL, DAL & more"
"we own united we own delta now we are starting to buy American"
JML
rocco2,
There is a cap just not sure who gets the extra shares above the cap. Maybe Labor Union.
1.204 Shares in Excess of Cap means, with respect to any Mandatory Conversion Date, a number of shares of New Common Stock equal to the sum of the Mandatory Shares in Excess of Cap and the Optional Shares in Excess of Cap.
JML
rocco2,
I hope there is not cap but I just wanted to warn people that there could be one. If the VWAP is over $35 for the next distribution we will know if there is a cap.
The $33.80 was the 96.5% VWAP. So $35 would be the VWAP cap.
JML
Its the Conversion Price Cap in the disclosure statement. I am rereading it trying to figure out what it means I am not a lawyer.
“Conversion Price Cap” means the greater of (i) $19.00 and (ii) the Initial VWAP less the Conversion Price Floor plus the Initial VWAP, subject to adjustment as set forth in Section 6.1.3
Its in Docket 10155 or 8591.
JML
The 60 day distribution date is 2/7/2014. How is 2/3/2014 6 days before that date? The 5 day VWAP will start on 1/31/2014.
JML
LCC received 1 share of AAL for every share of LCC. LCC got 100% of their shares in AAL. That is all you get. AAMRQ will be lucky to get 75% of their shares in AAL.
JML
Formula for 60 day distribution.
AAL has not released a formula. Based on what I know so far from the first distribution I have a formula that I think will be close enough for an estimate. This is just for the 60 day distribution.
If they give the Union more shares during the 60 distribution it could change the formula.
0.260 - 3.361/AAL = AAMRQ multiplier.
So if the stock is at $30 then the number to multiply your shares by would be 0.148 to get how many AAL shares you should receive.
This is just an estimate.
JML
Earnings Release Jan 28th for AAL
rocco2 the conversion price cap is $33.80
value hurdle price is different.
Value hurdle price is the AAL price above which AAMRQ shareholders will receive AAL shares. Below that price we will only receive what we currently have no more shares. That is at around $15 AAL.
The conversion price cap is the max VWAP that will be used for conversions. When you limit the VWAP you limit the multiplier for AAMRQ shareholders to a max of around 0.157 pre distribution.
Docket 10155 which is the updated disclosure statement. Page 341 of 376. It also in 8591.
Search for "price cap" in what ever disclosure statement you have.
“Conversion Price Cap” means the greater of (i) $19.00 and (ii)the Initial VWAP less the Conversion Price Floor plus the Initial VWAP, subject to adjustment as set forth in Section 6.1.3
The debt is in preferred shares. As the price goes up it takes less shares to pay the debt. That is the only reason we are getting more shares. That increase of shares stops at the conversion cap.
From the disclosure statement conversion cap for Preferred shares.
Initial VWAP was $22.3415 from aa investor relations website.
floor is 10.875
cap = ($22.3415 - $10.875) + $22.2415 = $33.80
“Conversion Price” means, with respect to any Conversion Date, an amount equal to
96.5% of the VWAP calculated with respect to such Conversion Date; provided, however, that
such amount shall not be less than the Conversion Price Floor nor greater than the Conversion
Price Cap.
“Conversion Price Cap” means the greater of (i) $19.00 and (ii) the Initial VWAP less the
Conversion Price Floor plus the Initial VWAP, subject to adjustment as set forth in Section 6.1.3
“Conversion Price Floor” means $10.875 per share of Common Stock, subject to adjustment as set forth in Section 6.1.
Pink,
Yes it depends on how much of the reserve claims fund they use. It was at 755 million when they started. If they don't use it then it will go to AMR Equity interests which AAMRQ is a part of that.
JML
The conversions max out at $33.80 which is the conversion cap price. Any price about that they use $33.80 for the VWAP.
Looks like we max out at a .157 for 60 and 90 day distributions above $33.80.
120 day could be higher.
JML
Rocco No way a 1:1
One thing I forgot to add was the conversion price cap.
I think the cap is $33 so if the stock goes over $33 then the preferred shares still convert at $33.
If we trade at $40 the conversion is still $33.
JML
The union is owed 23.6% of the creditors debt as if non had converted to common.
around 400 million converted to common. The rest of the debt was converted to preferred shares at $25.
167 million preferred shares for the double and single debtors
+16 million for the ones that converted to common
= 183 million shares
* 23.6% = 43 million shares owed the union.
Its all in shares now no more dollars owed.
JML
so what is your point?
The union is still owed around 20 million which they will get in the 4th distribution.
the union received 25million with the initial distribution.
To: U.S.-Based Legacy American Managers
Subject: Certain U.S.-Based Legacy American Employees to Receive Second Equity Distribution
Summary:
As previously communicated, the majority of U.S.-based legacy American employees are eligible to receive 23.6 percent of the shares of common stock in the new company (AAL) distributed to holders of allowed unsecured claims. The initial distribution of equity occurred on Dec. 9 with approximately 25 million shares of new common stock granted to eligible employees.
It wont happen.
The total number of shares to AMR stakeholders is 544 million
They have given out.
25 million to the union
26 million to AAMRQ shareholders
10 million first optional distribution
40 million first mandatory preferred distribution
52 million to AAMRQ shareholders
__________
153 million shares.
That leaves 391 million shares.
To get a 1:1 AAMRQ shareholders would need to get 316 million of those shares.
Wont happen since the double and single dip still have 115 million to convert.
The union is owed more shares too.
Wont happen but you can dream.
JML
rocco2 when you say 1:1 do you mean for every 1 AAMRQ share you get 1 AAL share?
To get a 1:1 you would need 3 more distributions at .260. That is double the first distribution. To get a 1:1 the stock would have to trade at over $60 for the next 90 days.
JML
rocco2 AAL would have to trade at around $50 to get a 1 for 1.
If they take the optional conversion shares from each of the same distributions such as the 1st 10 million optional shares come from the 1st mandatory shares(129 million shares) or if they take the optional shares from the 120 day mandatory conversion.
If they take the optional out the same mandatory.
1000 AAMRQ shares
AAL @$25
AAL shares per distribution
1st 106 AAL shares
2nd 104 AAL shares
3rd 103 AAL shares
4th 211 AAL shares
If they take the optional out of the 4th 120 day mandatory
1st 132
2nd 131
3rd 130
4th 129
wallst10 please explain how today is day 1? what are the dates for the 5 trading days BEFORE the conversion date on 1/8??
1/2 1/3 1/6 1/7 would be 4 days.
From the AAMRQ disclosure statement.
1.250 VWAP means, with respect to any date, the volume weighted
average price of New Common Stock for the five (5) trading days ending on the
last trading day immediately prior to such date
The 5 days end on 1/7 the last trading day before the conversion date of 1/8.
TIA..JML
I never said we would get shares on the 8th.
You said the 8th was the last day of the 5 day period.
I was just pointing out your were wrong based on the disclosure statement.
It could take up to 3 days to get the first distribution.
From the disclosure statement.
“VWAP” means, with respect to any Conversion Date or any other date of determination, the volume weighted average price of Common Stock for the five (5) trading days ending on the last trading day immediately prior to such date
The 5 days ends on the day before the conversion date.
Its based on 5 trading days VWAP
Volume Weighted Average Price
Not each days closing price.
VWAP is calculated by adding up the dollars traded for every transaction (price multiplied by number of shares traded) and then dividing by the total shares traded for the day.
You said.
"I think it is Jan 3,6,7,8,9."
The first distribution is on 1/8.
1/8/2014 Day 30 - Mandatory Conversion Date
The 5 day average is the 5 trading days BEFORE 1/8.
I would think it would be
12/31, 1/2, 1/3, 1/6, 1/7
JML
Double-Dip General Unsecured Claims; Single-Dip General Unsecured Claims; Disputed Claims Reserve
After giving effect to the conversions outlined above, the adjusted total Double-Dip General Unsecured Claims on the Effective Date is approximately $2.45 billion. The Allowed Single-Dip General Unsecured Claims on the Effective Date is approximately $2.45 billion and the Disputed Claims Reserve is approximately $755 million.
sec 8k 12/9/2013
AAMRQ distribution formula
AAMRQ 394.2 million fully diluted outstanding shares
AAMRQ debt with VWAP discount (5.655 claims / 0.965 discount) = $5860 million
AAMRQ debt $5.860 Billion claims + 1.817 billion owed union = $7677 million
AAL 756 million outstanding shares
source sec 8k filing
AMR stakeholders get 72% of the new company
Source BK dockets
Subtract out the 3.5% initial and AMR stakeholders get 68.5% at the distribution periods.
[(AAL * 756 million * 68.5% ) – 7677 million ]/394.2 million
Simplified
(AAL * 1.314) – 19.47 = AAMRQ value
(25 * 1.314) – 19.47 = $13.38
To calculate shares
([(AAL * 1.314) – 19.47] / AAL) * number of AAMRQ shares = AAL shares
So if you have 1000 shares and the stock stay at $25 for the 120 day distribution period.
Initial distribution 3.5% of the common goes to AAMRQ stockholders
1000 * [(756 million * 3.5%) / 394.2] = 67 AAL shares
Then for the next 4 distributions at 30,60,90 and 120 days
For each distribution 1000 / 4 = 250 AAMRQ shares
@30 ([(25 * 1.314) – 19.47] / 25) * 250 AAMRQ shares = 134 AAL shares
@60 ([(25 * 1.314) – 19.47] / 25) * 250 AAMRQ shares = 134 AAL shares
@90 ([(25 * 1.314) – 19.47] / 25) * 250 AAMRQ shares = 134 AAL shares
@120 ([(25 * 1.314) – 19.47] / 25) * 250 AAMRQ shares = 134 AAL shares
If AAL stays at $25 and you had 1000 AAMRQ shares at the end of 120 days you should have 603 AAL shares
IMO..JML
Final AAMRQ numbers
source sec 8k filing
AAMRQ 394.2 fully diluted outstanding shares
AAMRQ debt $4.95775 Billion
Formula
(AAL * 1.314) - 12.57 = AAMRQ value
(25 * 1.314) - 12.57 = $20.28
IMO..JML
Including all conversion elections, the adjusted fully diluted share count of the Company’s old common stock (formerly traded under the symbol “AAMRQ”) is approximately 394.2 million shares, and, as previously disclosed, holders of AAMRQ will receive, for each share of AMR common stock, an initial distribution of approximately 0.0665 shares of the Company’s new common stock, par value $0.01 (NASDAQ: AAL) in connection with the occurrence of the Effective Date. AAMRQ holders, and those deemed to be treated as such in connection with the elections discussed above, may in the future receive additional distributions based on the trading price of AAL during the 120 day period after the Effective Date and the total amount of allowed claims, in each case, in accordance with the terms of the Plan.
Double-Dip General Unsecured Claims; Single-Dip General Unsecured Claims; Disputed Claims Reserve
After giving effect to the conversions outlined above, the adjusted total Double-Dip General Unsecured Claims on the Effective Date is approximately $2.45 billion. The Allowed Single-Dip General Unsecured Claims on the Effective Date is approximately $2.45 billion and the Disputed Claims Reserve is approximately $755 million.
From the disclosure statement. docket 8591 page 19 of 510
AMR Equity Interests = AAMRQ
1.250 VWAP means, with respect to any date, the volume weighted
average price of New Common Stock for the five (5) trading days ending on the
last trading day immediately prior to such date
As set forth in the Plan, the amount of additional shares of New Common Stock
that will be issued on the Mandatory Conversion Dates to holders of Allowed AMR Other
General Unsecured Claims, Allowed American Other General Unsecured Claims, Allowed
Eagle General Unsecured Claims, and Allowed AMR Equity Interests is determined by the
VWAP of the New Common Stock on the Mandatory Conversion Dates. Specifically, the
amount of additional shares of New Common Stock distributable to the holders of Allowed
Equity Interests depends on whether the price of the New Common Stock as of the relevant
Mandatory Conversion Date exceeds the value which would imply that the New Common
Stock distributable to holders of Allowed General Unsecured Claims is sufficient to
effectively pay such Claims in full (i.e., par plus accrued interest thereon, at the nondefault
contract rate or federal judgment rate (as appropriate) from the Commencement Date
through the Effective Date, including interest on overdue interest), and including certain
additional value to address the market volatility and liquidity concerns during the 120-day
period following the Effective Date, as discussed more fully below. For illustration
purposes only, a table reflecting various potential recovery estimates based upon numerous
assumptions and a range of prices for the New Common Stock is annexed hereto as
Exhibit “B.”
AAMRQ 398 million outstanding.
335.3 million oustanding AAMRQ is now 398 million outstanding.
1000 AAMRQ * 0.0665 = 66 AAL shares
AAMRQ gets 3.5% of the outstanding common of AAL. When you divide that up among the AAMRQ shareholder for every 1 share you get 0.0665 shares of AAL, That is not 6.5% of the distribution. You get 6.5% of your shares AAMRQ in new AAL shares.
1000 AAMRQ = 66 AAL shares.
Its 66 shares * $23.60 NOT 666 * 23.60
66 * $23.60 = $1557.60
Rounding up would be 67 shares.
For the AAMRQ distibutions 66.5 rounds down to 66
for 66.51 it rounds up to 67
It looks like we ended up with around 398 million fully diluted outstanding shares.
JML
AAMRQ fully dilluted outstanding shares to be released on 12/9.
AMR investor relations will release the final AAMRQ fully diluted outstanding shares on Monday 12/9. The number could increase due to senior debt that converted to common shares.
You will have to update your formulas on Monday.
TIA..JML