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TWA PENSION ACCORD REACHED WITH PBGC PACT MAILED AS MAJOR STEP IN AIRLINE'S BANKRUPTCY REORGANIZATION

 TWA PENSION ACCORD REACHED WITH PBGC
 PACT MAILED AS MAJOR STEP IN AIRLINE'S BANKRUPTCY REORGANIZATION
 NEW YORK, Oct. 29 /PRNewswire/ -- Three major Unions -- Air Line Pilots Association (ALPA), Independent Federation of Flight Attendants (IFFA) and the International Association of Machinists (IAM) -- representing almost 25,000 employees at Trans World Airlines, announced an agreement signed in the early hours this morning with the Pension Benefit Guaranty Corporation and the Creditors' Committee in the TWA bankruptcy proceeding. "This is a momentous accomplishment," commented IFFA President Vicki Frankovich. "This agreement releases our airline from the huge underfunded liability which has been a major hurdle to emerge from bankruptcy and allows us to go forward with the reorganization and frees up the PBGC to seek full recovery from Mr. Icahn and his entire "control group" of other companies. "Its been a grueling process, but its worth it," she said after emerging from the 25 hour bargaining session noting that the "agreement is pivotal to a successful emergence from bankruptcy."
 Among the significant features of the agreement is a commitment from TWA to pay down a portion of the underfunded pension liability by payment of $300 million amortized over 15 years. Amounts recovered from Icahn by the PBGC will be treated as plan assets, allowing for payment of benefits in excess of PBGC guarantees and allowing further for the possibility of future plan restoration.
 A key component in PBGC's recovery from Mr. Icahn is the termination of the existing retirement plans which will cause the financier's contingent liability -- estimated at $1.2 billion to come due immediately.
 Under the new agreement, all employees will participate in new defined contribution plans, providing future benefit accruals upon termination of the previous plans.
 The PBGC also approved a company-wide Early Retirement Incentive Program, allowing several hundreds of senior employees to early retire with a lump sum distribution from the retirement plan.
 Frankovich, who also serves as the Employee Representative on the creditors' committee, termed the agreement as "having something good for everyone." The union president concluded that "TWA has a manageable payment schedule, employees will continue to accrue future retirement benefits, the creditors' committee sees a successful emergence from bankruptcy....and the government (PBGC) has positioned itself to recoup a major pension underfunding" deep pocket.
 -0- 10/29/92
 /CONTACT: Vicki Frankovich, president of IFFA, 212-818-1130/ CO: Trans World Airlines ST: New York IN: AIR SU:


LD-SM -- NY086 -- 6782 10/29/92 16:39 EST
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Publication:PR Newswire
Date:Oct 29, 1992
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