Gold Drops to $1,200/oz for First Time Since June in New York
US Airways’ Kirby Gains $1.37 Million After Stock Gain
US Airways Group Inc. President Scott Kirby, who has helped lead the carrier’s push for a merger with bankrupt AMR Corp. (AAMRQ)’s American Airlines, earned a $1.37 million profit from a sale of the company’s stock.
The disposal of 114,862 US Airways shares occurred on Jan. 8 when the stock hit the $15 trigger price set last year when Kirby created the so-called Rule 10b5-1 plan, according to a U.S. Securities and Exchange Commission filing. The shares were valued at $3.10 when placed in the plan, the filing said.
Kirby set up the stock plan after US Airways disclosed on Jan. 25 that it was studying an American merger, two people familiar with the matter said yesterday, without giving a date. Company rules bar changing such plans once they’re created, said three people, who asked not to be identified because the matter is private. US Airways has almost doubled since Jan. 25.
Rule 10b5-1 “permits persons to trade in certain specified circumstances where it is clear that the information they are aware of is not a factor in the decision,” such as having preset terms for a sale, the SEC says on its website. The plans are often viewed as protection against insider-trading claims.
“There’s nothing wrong with them,” Bruce Vanyo, national co-head of the securities litigation practice at Katten Muchin Rosenman LLP, said in an interview today. “It was designed by the SEC quite a while ago to allow executives where their only asset is stock of the company to be able to diversify safely without risk of being accused of insider trading. It has a bona fide purpose.”
Use of the plans is “quite prevalent,” Vanyo said, although no one knows for certain how many exist because they aren’t disclosed unless the sale of stock by a corporate officer or director requires an SEC filing.
US Airways declined to comment about Kirby’s sale, said Kelly Sullivan, a spokeswoman for the Tempe, Arizona-based airline who works for public-relations firm Joele Frank, Wilkinson Brimmer Katcher.
AMR Chief Executive Officer Tom Horton has said he expects a decision to be made on a possible US Airways merger within weeks. Fort Worth, Texas-based AMR, which filed for bankruptcy protection on Nov. 29, 2011, has said it prefers to remain independent and consider mergers after it leaves Chapter 11.
A combination of American, the third-biggest U.S. carrier, and No. 5 US Airways, would pass United Continental Holdings Inc. to become the world’s largest airline, based on passenger traffic.
US Airways fell 2.4 percent to $14.78 at the close of trading in New York.
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