Shareholder sues US Airways over executive severance packages

Airline Industry Information, August 29, 2001

AIRLINE INDUSTRY INFORMATION-(C)1997-2001 M2 COMMUNICATIONS LTD

US Airways Group Inc is being sued by a shareholder, Steven Rosenberg, over a severance payment deal for the company's top three executives.

Under the agreement, the executives would receive USD45m in severance payments if they resign. The deal was part of a proposed merger with United Airlines and although that merger failed, the executives may still quit 30 days after the first anniversary of the shareholder vote held on 12 October 2000 and claim the benefits, according to The Washington Post.

The lawsuit claims that the deal gives the executives an incentive to resign and that it is 'grossly imprudent and injurious' to the airline.

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