# In re Patriot Coal Corp.

> United States Bankruptcy Court, E.D. Missouri · May 29, 2013 · 493 B.R. 65

URL: https://www.frixlaw.com/law-library/cases/8495962

## Case

- **Full name:** In re PATRIOT COAL CORPORATION, Debtors
- **Court:** United States Bankruptcy Court, E.D. Missouri
- **Decided:** May 29, 2013
- **Citations:** 493 B.R. 65; 196 L.R.R.M. (BNA) 2093; 2013 Bankr. LEXIS 2239; 2013 WL 2354049
- **Precedential status:** Published
- **Opinion:** Opinion of the court by Surratt
- **Judges:** Surratt
- **Cited by:** 10 later opinions in the Frix Law Library

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- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/8495962

## Opinion text

MEMORANDUM DECISION AND ORDER ON MOTION TO REJECT COLLECTIVE BARGAINING AGREEMENTS AND TO MODIFY RETIREE BENEFITS PURSUANT TO 11 U.S.C. §§ 1113 , 1114 OF THE BANKRUPTCY CODE
KATHY A. SURRATT-STATES, Chief Judge.
The matter before the Court is the Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code and the UMWA’s Objection to the Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 and 1114. Also filed were the following objections of other interested parties, whose participation was limited by this Court to I) one 15-page brief or objection, ii) an opening statement, and iii) a closing argument: Statement of the Official Committee of Unsecured Creditors in Connection with the Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code which was withdrawn in part at the time of closing argument, 1 Objection *77 to Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code filed by The Ohio Valley Coal Company and The Ohio Valley Transloading Company, Objection to Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefit[s] Pursuant to Sections 1113 and 1114 of the Bankruptcy Code filed by Drummond Company, Inc., Objection to Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefit[s] Pursuant to Sections 1113 and 1114 of the Bankruptcy Code filed by Energy West Mining Company, Statement of Bank of America, N.A., as Second Out DIP Agent, With Respect to the Hearing on Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code, Limited Objection of U.S. Bank National Association, as Indenture Trustee, to Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code, Objection of Wilmington Trust Company, as Indenture Trustee, to the Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code, Noteholders’ Objection to Motion to Reject Collective-Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 and 1114, Objection to Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits] Pursuant to Sections 1113 and 1114 of the Bankruptcy Code filed by Cliffs Natural Resources Inc. and Sureties’ Reservation of Rights Regarding Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code. In response to the various objections filed by the “other interested parties” as well as the UMWA’s Objection, Debtors filed Omnibus Reply Memorandum of Law in Further Support of the Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 and the UMWA filed UMWA’s Omnibus Reply Memorandum Regarding the Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 and 1114. Also of note is that on April 2, 2013, as represented in this Court’s April 5, 2013 Order, this Court granted the Motion to Intervene by the United Mine Workers of America 1974 Pension Trust and the United Mine Workers of America 1993 Benefit Plan in large part because of the contents of the 1113 Proposal at that time. Upon counsel’s representation that the 1974 Pension Trust and the 1993 Benefit Plan cannot “independently grant concessions” and must “work with the bargaining parties that created these obligations in the first place,” 2 the Court granted Debtors’ oral motion to limit the participation of the 1974 Pension Trust and 1993 Benefit Plan going forward, 3 in large part because *78 these parties do not have the ability to negotiate which is an inherent component of Sections 1113 and 1114. Nevertheless, the Court also considers the Objection of the United Mine Workers of America 1974 Pension Trust and the United Mine Workers of America 1993 Benefit Plan to the Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code as well as the Objection and Joinder of the United Mine Workers of America 2012 Retiree Bonus Account Plan to Objection of the UMWA 1974 and 1993 Plans to Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code. The Court held hearings on this matter which commenced on April 29, 2013 and concluded on May 3, 2013. The matter was taken under submission. In accordance with the ’30-day from the commencement of the hearing’ constraint imposed by Congress as stated in Section 1113(d)(2), and because of the implicitly intertwined nature of the relief requested pursuant to Sections 1113 and 1114 in Debtors’ Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code (hereinafter the “1113/1114 Motion”), the Court herein rules on the 1113/1114 Motion in its entirety.
I. INTRODUCTION
On July 9, 2012, Debtor Patriot Coal Corporation and a number of its affiliates (hereinafter collectively “Debtors”) filed Voluntary Petitions for relief under Chapter 11 of the Bankruptcy Code in the Southern District of New York. These Chapter 11 cases are being jointly administered pursuant to Federal Rule of Bankruptcy Procedure 1015(b) as well as the Joint Administration Order entered on July 10, 2012. Debtors are authorized to operate their businesses and manage their properties as Debtors In Possession pursuant to Sections 1107(a) and 1108 of the Bankruptcy Code. On December 19, 2012, the cases were transferred to the Bankruptcy Court for the Eastern District of Missouri following the Southern District of New York’s Memorandum Decision entered on November 27, 2012, which instructed that the cases would be transferred.
As observed by the Bankruptcy Court for the Southern District of New York in the Memorandum Decision on Motions to Transfer Venue Pursuant to 28 U.S.C. § 1412 , there is unquestionably no dispute that the lives and livelihoods of Debtors’ employees, both union and non-union, current and retired, depend on the outcome of Debtors’ reorganization. “The retirees’ health and access to health care depend on the outcome of these cases. Indeed, without the dedication and sacrifice of the coal miners and their families, there would be no coal, and there would be no Patriot Coal.” In re Patriot Coal Corp., 482 B.R. 718, 722 (Bankr.S.D.N.Y.2012). There can be no Patriot Coal stock to dispute, or tonnage payments to negotiate, or companies to reorganize, unless there are men and women willing to bend their knees to excavate coal.
And, as the Bankruptcy Court for the Southern District of New York observed, and this Court now observes, this Court has been charged with applying the Bankruptcy Code and other applicable law to the facts and circumstances presented. The overarching goal for this Court is to guide Debtors through the Bankruptcy Code, particularly its Chapter 11 stric *79 tures, to maximize the value of Debtors’ estates for the organized benefit of all stakeholders, including the United Mine Workers of America’s (hereinafter the “UMWA”) constituents — the coal miners, employees, retirees and other beneficiaries that the UMWA represents — and guide Debtors to emerge from Chapter 11 as a financially and operationally stronger company. This Court has accepted both the privilege and responsibility of this task and undoubtedly has been weighing the intellectual scales of the matter presented, inexorably to this purpose — this Memorandum Decision and Order.
As of the date of entry of this Memorandum Decision and Order, this Court has received over 900 letters from interested parties, all of which have been read by the Court and placed on the record as correspondence. Many of these letters discuss the imminence of bankruptcy cases for retired coal miners and their families should Debtors be permitted to modify the Collective Bargaining Agreements (hereinafter “CBA” or “CBAs”) and the Retiree Benefits. Many discuss the horrendous conditions of the coal mines when those individuals first began to work, and how hard it was to achieve the promises made pursuant to both the previous and the current CBAs. Some discuss how physically, mentally and emotionally grueling being a coal miner was, many of whom worked as coal miners for over 30 years — a sacrifice made with due consideration of the promised health care from cradle to grave. The Court has received numerous medication lists, lists of various coal mining-related diagnoses and personal accounts of the years of hard work, and, all the reasons why these sacrifices were worth it for the promise of health care for life and an earned pension. One retiree in particular informed the Court that when he first began working, he was given two weeks vacation which was taken when instructed by his superior, and when he retired over 30 years later, he had two weeks vacation which was taken when instructed by his superior. Many coal miners talk of six (6) and seven (7) day work-weeks, of over 12 hours a day. Some letters discuss various injuries sustained while working in coal mines, limbs of self and relatives lost, and the lives lost of relatives and friends. None of these letters, or their comments have been lost on this Court. And, as counsel for the UMWA so eloquently stated, many current and retired coal miners do not have cost spreading abilities, because, for many, cost spreading “means cutting your pills in half. Cost spreading abilities for retirees means making a choice today over medicine or food. And, if you are a diabetic it means making a very difficult choice indeed. Cost spreading abilities for workers means that they either give up their seniority and go out and face the vicissitudes of the modern day unemployment situation, or accept massive wage cuts ...” 4
The Court’s evaluation however must begin with this threshold question: What does the Bankruptcy Code and stare deci-sis require? So too, the matter before the Court begs the following questions: Is it indeed that Debtor Patriot Coal Corporation was created to fail, or is it that hindsight is 20/20 — and, does the answer to that question have anything to do with the matter before the Court today? What is better — something for a period of time or nothing in a short amount of time? What of the current employees; the fate of the rank and file UMWA-represented coal miners? And, while the 1113/1114 Motion does not affect any retirees who have been diagnosed with black lung disease and re *80 ceive certain benefits by. federal law pursuant to the Coal Act, what of those with diagnoses other than black lung disease and who do not receive any benefits under the Coal Act? If the relief requested is granted, will the resulting pool of funds be allocated according to the health needs of the retirees? What of the prospects of a strike in the event that this Court determines that Debtors have met their statutory burden to reject and modify the CBAs and to modify the Retiree Benefits? What of the lives, financial viability, and broken promises if this Court determines that Debtors have met their statutory burden to reject and modify the CBAs and to modify the Retiree Benefits? What effect will this Court’s ruling have on local economies, particularly those in mining communities that thrive on the patronage of those affected by the outcome of the 1113/1114 Motion? But, again, what does the Bankruptcy Code and stare decisis require?
This Memorandum Decision and Order will address the history of the subject CBAs and Retiree Benefits, the history of Debtors and their assumption of CBAs and the liabilities for the Retiree Benefits, the Sections 1113 and 1114 Proposals made by Debtors and ultimately, this Court’s application of the law to the facts presented in the ephemeral 25 days provided to this Court by the Bankruptcy Code to perform this daunting task.
II. FINDINGS OF FACT
A. What Is Coal?
Coal is a fossil fuel that forms from the remains of vegetation as long as 400 million years ago. The plants from eons ago captured energy through photosynthesis to create compounds (carbon) in plant tissue. When those plants and trees died, they ultimately sunk to the bottom of swamps and formed a dense material called peat. As the earth’s surface changed over time and sand deposits accumulated, the peat got buried. Over time, the water in the peat was squeezed out from the weight of the evolving earth’s surface. The compacted plant matter, the peat, progressively carbonized under the pressure and changing temperatures and eventually became a combustible sedimentary and metamorphic rock which is affectionately referred to as coal.
There are at least four ranks of coal, which is based on the carbon content: lignite, subbituminous, bituminous and anthracite. Some estimate that 90% of the coal in America is bituminous (soft) coal, which is most used I) to make electricity through combustion in boilers to make steam which is used to generate power (called steam or thermal coal) and ii) to make coke for the steel industry (metallurgical or coking coal). 5 As will be discussed further below, Debtors mine bituminous coal.
B. The United Mine Workers Of America
The UMWA is a labor union which was formed in Columbus, Ohio on January 22, 1890 with the stated purpose of “educating all mine workers in America to realize the necessity of unity of action and purpose, in demanding and securing by lawful means the just fruits of our toil.” 6 The UMWA represents over 1650 of Debtors’ approximately 4200 current active employees, which comprises 42% of Debtors’ overall *81 workforce and about 60% of Debtors hourly work force.
C. The Bituminous Coal Operators’ Association
The Bituminous Coal Operators’ Association (hereinafter the “BCOA”) is a mul-tiemployer bargaining association formed by coal mine operators in the mid 1900s. Its sole purpose is to bargain with the UMWA on behalf of its coal industry employer members. Peabody Energy Corporation (hereinafter “Peabody”) and Arch Coal, Inc. (hereinafter “Arch”) have self-identified as members of the BCOA. 7
D. The History Of The CBAs And Retiree Benefits (The 1974 Pension Plan And The 1993 Benefit Plan)
1. The Early Years
Turmoil in the earlier parts of the 20th century ultimately instigated President Truman to issue an Executive Order which directed Julius Krug, then Secretary of the Interior, to seize virtually all bituminous coal mines in the United States and to negotiate “appropriate changes in the terms and conditions of employment” of miners with the UMWA. 11 Fed. Reg. 5593 (1946). These negotiations, held in principal between Secretary Krug and Mr. John L. Lewis, then-president of the UMWA, yielded the Krug-Lewis Agreement, pursuant to which the previously seized coal mines reverted to private control and the National Bituminous Coal Wage Agreement of 1947 (hereinafter “1947 NBCWA”) was created. Under the 1947 NBCWA, benefit funds were created which provided for medical expenses of miners and their dependents. The 1947 NBCWA set out the terms and conditions of employment for coal miners employed by members of the BCOA as well as companies that sign “Me Too” agreements with the UMWA. A “Me Too” agreement is an agreement whereby an employer who is not a member of the BCOA agrees to be bound by the terms of the current NBCWA. Every few years for the last sixty-six years, the UMWA and the BCOA renegotiate the terms of the NBCWA.
Due to disagreements over what kinds of benefits were owed to miners under the terms of the 1947 NBCWA, the UMWA and the BCOA entered into the 1950 NBCWA which established the 1950 Welfare and Retirement Fund. The principal difference between the 1950 NBCWA and the 1947 NBCWA was that the 1950 NBCWA established a “pay-as-you-go” system and required that a “30-cents-per-ton royalty on coal produced payable by signatory operators on a ‘several and not joint’ basis for the duration of’ the 1950 NBCWA. Eastern Enters. v. Apfel, 524 U.S. 498, 506-07 , 118 S.Ct. 2131, 2138 , 141 L.Ed.2d 451 (1998) (plurality opinion). “The [1950] Fund operated using a fixed amount of royalties, with the trustees having the authority to establish and adjust the level of benefits provided so as to remain within the budgetary constraints.” Id. at 507 , 118 S.Ct at 2138 .
2. The Employee Retirement Income Security Act (ERISA) And The 1974 NBCWA
The Employee Retirement Income Security Act of 1974 (hereinafter “ERISA”) required pension plans to be funded on an actuarial basis. Consequently, the 1950 NBCWA could no longer operate under a “pay-as-you-go” system. Thus, the UMWA and the BCOA entered into the 1974 NBCWA which differed substantially from previous NBCWAs. Generally the 1974 NBCWA substantially increased ben- *82 efíts and liberalized eligibility requirements for health benefits as well as pensions. The 1974 NBCWA also introduced several entirely new benefits such as lifetime health benefits for disabled mine workers, mine workers’ surviving spouses and disabled children.
Specifically, the 1974 NBCWA established four separate trusts: the UMWA 1950 Pension Plan, the UMWA 1974 Pension Plan, the UMWA 1950 Benefit Plan and the UMWA 1974 Benefit Plan (hereinafter collectively the “1974 NBCWA Plans”). The 1950 Pension Plan and 1950 Benefit Plan were to provide pension and health benefits to mine workers that retired prior to January 1, 1976. The 1974 Pension Plan and 1974 Benefit Plan were to provide pension and health benefits for active miners and those who would retire after January 1, 1976. The BCOA members funded the 1974 NBCWA Plans by paying not only a per ton fee, but also a flat fee for every hour worked by the UMWA-represented coal miners.
As a result of the increased benefits afforded to beneficiaries and the decline in coal production, as well as contentious negotiations which included a 111-day industry-wide strike, the 1974 NBCWA Plans quickly faced serious financial difficulties. Davon v. Shalala, 75 F.3d 1114 , 1117-18 (7th Cir.1996). Consequently, the UMWA and the BCOA entered into the 1978 NBCWA which greatly impacted the 1974 Benefit Plan. Davon, 75 F.3d at 1118; Holland v. Double G Coal Co., 898 F.Supp. 351, 353-54 (S.D.W.Va.1995). Under the 1978 NBCWA, signatory mine operators obtained the contractual right to provide health benefits directly to active and retired miners, rather than through the 1974 Benefit Plan. The 1974 Benefit Plan and the 1974 Pension Plan were restructured such that (I) the 1974 Benefit Plan and the 1974 Pension Plan had the sole responsibility of funding benefits for “orphaned retirees” — retirees whose last employer went out of business or otherwise ceased contributing to the Plans; and (ii) signatory employers would guarantee all health and pension benefits during the term of the 1978 NBCWA and would be required to contribute to the 1974 Benefit Plan and 1974 Pension Plan as long as they remained in the coal business, regardless of whether they signed a subsequent agreement. Section (ii) is called the Evergreen Clause. 8
Soon, the BCOA member-employers began to go out of business and signatory coal companies began to withdraw from the 1978 NBCWA. The 1974 Benefit Plan was left with more orphaned retirees and a smaller funding base to provide for those beneficiaries. See UMWA 1992 Benefit Plan v. Leckie Smokeless Coal Co., 99 F.3d 573 , 576 (4th Cir.1996), cert. denied, 520 U.S. 1118 , 117 S.Ct. 1251 , 137 L.Ed.2d 332 (1997) (“the number of employers contrib *83 uting to the plans declined, the number of orphaned miners increased, and the costs of health care soared.”) (citing LTV Steel Co. v. Shalala (In re Chateaugay Corp.), 53 F.3d 478, 483-84 (2d Cir.1995), cert. denied, 516 U.S. 913 , 116 S.Ct. 298 , 133 L.Ed.2d 204 (1995)). The remaining employers who signed the 1978 NBCWA were forced to deal with the increasing cost of covering the orphaned retirees.
3. The 1988 NBCWA; The Pittston Dispute And The Coal Commission
By 1988, it became apparent that the contribution rate specified for the 1974 Benefit Plan was not sufficient to cover its costs. In 1988, the UMWA and the BCOA entered into the 1988 NBCWA that increased the contribution rate from five cents (5 tom line that matters and, as Mr. Hatfield testified, no coal customer is interested in whether it was unionized or non-unionized labor that mined the coal. It is the final cost of the coal that matters. The Court declines to further entertain the union vs. non-union debate because among other things, it is a red herring to the task at hand.
A more pertinent challenge along these lines is the UMWA’s argument that the relief requested in the Fifth 1113 Proposal is excessive relative to the concessions sought from non-union labor. This evaluation has been a consistent challenge to courts, and this Court is no exception. What are fair and equitable concessions?
Judge Davis stated in Mesaba II that “[b]ankruptcy law is draconian to labor unions.” Mesaba II, 350 B.R. at 443 . The UMWA has steadfastly negotiated improved working conditions for its membership, and with Debtors’ Chapter 11 filings, the fruits of that labor is threatened. Pre-bankruptcy, Debtors’ workforce was roughly 50% unionized, 50% non-unionized. *133 Today, roughly 57% of Debtors’ workforce is unionized. This is a result of several non-union lay-offs that Debtors have already implemented. Debtors have limited non-union salaries even when unionized workers continued to receive raises pursuant to their CBAs. The argument here is therefore that the gravity of the concessions sought by the unionized miners is in effect just a ‘catch-up’ to the cutbacks that the remainder of Debtors’ employees have endured for the past few years. But of course, the unionized workforce escaped those pay freezes, vacation limitations, unrestricted work-hours and the like in exchange for lower pay, promised pensions, health care coverage and retiree benefits. The question is not is this fair to the unionized miners; is this equitable to the unionized miners. Rather, the question presented is whether these overall changes are fair and equitable to all interested parties which necessarily includes an evaluation of the treatment of the unionized labor.
Under federal law, employees have the choice of whether or not to be unionized. Bankruptcy law is also federal law and Section 1113 takes no prisoners. So it was written by Congress. Years of toil, perseverance and determination of miners past yielded the employment terms and conditions of miners today, but this does not matter where, as here, savings everywhere else have already been explored within reason and exhausted.
This Court has already discussed the savings achieved before Debtors sought concessions from Debtors’ UMWA-repre-sented labor. Those savings are significant. Now, the only place left to turn is Debtors’ UMWA-represented labor and the Retiree Benefits. This is not a union versus non-union evaluation; it is an evaluation of what is necessary for Debtors to emerge from bankruptcy as a viable company and whether or not the path chosen to implement what is necessary is fair and equitable. Given the grave disparity between union and non-union pay and benefits prebankruptcy, the limitations placed on non-union labor that have been in place for years, and acceptance of the reality of the savings needed, the Court concludes that the UMWA-represented employees are not tasked to disproportionately shoulder the burden of Debtors’ bankruptcy. The UMWA has fought for benefits and it will continue to do so, of this there is no doubt. 234
With regard to the Fifth 1114 Proposal, the UMWA also challenges that neither it, nor this Court, can evaluate whether the 35% of equity is fair and equitable because among other things, the stock is not valued and the UMWA was not given sufficient information about the other stock holders for the UMWA to evaluate the governance rights associated with the 35% equity. To determine that 35% was the appropriate equity stake that reasonably equates to the present value of the UMWA’s unsecured claim, Debtors considered several mathematical outcomes based on varied probabilities that would affect Debtors’ total enterprise value. Based on these computations, Debtors determined that 35% appropriately characterized both the strength and weakness, thus certainty *134 and risk, associated with the UMWA’s claim. Mr. Huffard testified that a regression model was not created to determine the appropriate equity stake allocable to the UMWA in that Debtors cannot ably say that a certain percentage was allocated to a certain factor to determine the 35% equity stake. Debtors however explained how the 35% equity stake was derived in the April 24 and 25, 2013 meetings with the UMWA, which included discussions with Mr. Hatfield, a presentation by, Bankruptcy Counsel for Debtors and a presentation by Blackstone. Debtors explained that based on Debtors’ calculations, in the most pessimistic of scenarios, the UMWA claim could be worth as little as 12% of the reorganized Debtors and in the most optimistic of scenarios, which includes a 100% weighting for substantive consolidation — a determination which this Court has expressed on numerous occasions it will not make at this premature time — the UMWA claim could be worth as much as 57% of the reorganized Debtors. Simplistically, the UMWA stated in its Fourth Counter-proposal that it wants a 57% equity stake in the reorganized Debtors, including all subsidiaries, partnerships and related entities. 235
Granting the UMWA a 57% equity stake could never be deemed fair and equitable because there are other creditors that must be considered. Nonetheless, the question is whether Debtors’ proposal is fair and equitable. This Court has stated several times, and will here state once again, there is no certainty in cases like these. Everything is based on forecasts and probabilities. Debtors considered a myriad of assumptions and determined that 35% was appropriate. A 35% equity stake is likely as good of an estimation as any other because on one side, the UMWA thinks 35% is too little, and on the other side, several interested parties believe that 35% is too much. At closing argument, the Official Committee of Unsecured Creditors stated that it conducted its own analysis and determined that Debtors’ Fifth 1114 Proposal is in actually a 35% equity stake, plus royalty contributions which are worth 4% of the reorganized Debtors, for a total of 39% of value to the UMWA. The Official Committee of Unsecured Creditors considers Debtors’ Fifth 1114 Proposal to be fair and equitable to all creditors solely for the purposes of the 1113/1114 Motion and therefore withdrew its limited objection.
Prior to the offer of a 35% equity stake, the UMWA was offered an unsecured claim. To some extent, the clarity that followed the offer of a 35% equity stake is further shadowed by uncertainty surrounding the same. Just like the actual value of the 35% depends on many wonders to be seen, so too, the monetization of that equity stake is still to be determined. The UMWA could determine, at its own election, that it is only appropriate to monetize a portion of the 35% equity today, and that at some opportune time in the future, likely after Debtors are cash flow positive, to monetize- another portion of the equity. This alone could drastically affect the total dollar value ultimately derived from the 35% equity stake. This is the time for hedging bets and making the best projections possible, to make the best decisions possible. All creditors are fairly and equitably in this same reality of uncertainty. The UMWA’s general uncertainty does not exceed that of any other creditor.
The Court also considers the inclusion of profit sharing and royalties to fund the VEBA to intimate fairness and equitableness in that this stream of additional funding is a stride towards alleviating at least *135 some of the strain imposed by Debtors Fifth 1114 Proposal. After all, any profits achieved by the reorganized Debtors will be in large part a fruit of the sacrifices of the retiree beneficiaries, so it is only fair and equitable that at least some of those funds revert to prebankruptcy purposes. Debtors responsibly proposed that profit sharing would only begin after Debtors’ minimum financial thresholds are achieved which shows consideration for Debtors’ financiers and investors. This is reasonable and demonstrates that Debtors have sought to craft the most fair and equitable solution to the wrath that is reorganizing Debtors. By a preponderance of the evidence, Debtors have met their burden that the concessions are fair and equitable.
6.Meeting At Reasonable Times, and, 7.Confer In Good Faith Attempt To Reach Mutually Satisfactory Modifications
Little discussion is warranted here concerning whether Debtors and the UMWA met at reasonable times. Suffice it to say, both parties demonstrated a commendable effort to meet and accommodate each other. Those conferences were in good faith and were an attempt to reach mutually satisfactory modifications. The record is clear that Debtors’ progressive Proposals were each tailored to meet specific concerns of the UMWA. Each UMWA Counterproposal showed some additional compromise. Sections 1113 and 1114 contemplate a compressed schedule and this Court commends both parties’ attempts to consensually resolve this matter while simultaneously representing their clients. As it happens so much in life, a mutually satisfactory resolution was out of reach. 236
8.Union Must Have Refused To Accept The Proposal Without Good Cause
The union has the burden of proof that it had good cause to reject the debtor's proposal. In re Northwest Airlines Corp., 346 B.R. at 328 ; In re Bowen Enterprises, Inc., 196 B.R. 734, 741 (Bankr.W.D.Pa.1996); In re Express Freight Lines, Inc., 119 B.R. at 1011 ; In re Garofalo's Finer Foods, 117 B.R. at 370 . While it is the debtor's motion for rejection or modification that is before the court, a union may show that it had good cause to reject the debtor's proposal if the union's counterproposal meets the debtor's needs to obtain savings. In re Horsehead Indus. Inc., 300 B.R. at 585 (citing Maxwell Newspapers, Inc., 981 F.2d at 90; Royal Composing Room, Inc., 848 F.2d at 349 ). "[D]epending on the facts of the *136 case, a debtor may not be obligated to reduce the total amount of cost savings requested in its original proposal to demonstrate good faith” and thereby give the union good cause to reject the debtor’s proposal. In re Northwest Airlines Corp., 846 B.R. at 327 (citing In re Indiana Grocery Co., 136 B.R. at 195-96 ). A court may look at the debtor’s flexibility in the allocation of concessions as a means of evaluating whether the union had good cause to refuse the debtor’s proposal. In re Northwest Airlines Corporation, 346 B.R. at 327 .
At the outset, this Court comfortably concludes that the UMWA’s Fourth Counterproposal lacked the compromise needed to meet the test for the American Provision factors and therefore, the UMWA did not have good cause to reject the Proposals on that basis. This Court could never conclude that the UMWA-cen-tric Fourth Counterproposal is fair and equitable to all stake holders. This Court’s review of the Original Proposals in relation to the Fifth 1113 Proposal and the Fifth 1114 Proposal demonstrates that Debtors aimed to be flexible in their approach to the achievement of the required savings. The overall amount of Debtors’ savings has not changed over the course of the iterations of Proposals, however, this is reasonable because the requested savings are what is needed for Debtors to emerge from bankruptcy and none of the UMWA counterproposals were even in the neighborhood of the required savings.
October 31, 2007 is in the past and the future is unwritten. Ideally, the UMWA would maintain its bargaining position and its membership would continue to enjoy the rights that were bargained for. Debtors are in bankruptcy, and bankruptcy changes everything. Good cause to reject the Proposals must be evaluated in the context of bankruptcy where other creditors are in the mix. Debtors and the UMWA have made considerable strides towards a mutually uncomfortable milieu, but they simply did not get there. For example, the UMWA accepted the concept of the VEBA and Debtors accepted the inclusion of a litigation trust and better defined profit sharing and royalty contribution provisions. President Roberts even publicly acknowledged that the Fifth 1114 Proposal “appears to be a step forward.” 237
Finally, there was some discussion that perhaps the UMWA has good cause to refuse the Proposals because if Debtors are forced into liquidation, the responsibility to pay some Retirees Benefits would revert to Arch. While possible based on a cursory review of the chain of responsibility for the provision and finance of the Retiree Benefits for some of the affected retirees, such a position is untenable because it fails to account for the implications of the remaining components of the requested relief in the event of liquidation, for example, the fate of those retirees who will be left orphaned and thus included in the 1993 Benefit Plan, whose inclusion could most likely cause the collapse of the 1993 Benefit Plan, in addition to the loss of jobs of current UMWA-represented miners. Suffice it to say, this is an insufficient basis for the UMWA to reject the Proposals outright. Therefore, this Court must conclude given the necessity, fairness and equitableness to all interested parties, and the tailored components of the requested relief — to the inclusion of the development as reflected in the iterations of the Proposals — the UMWA has not demonstrated that it had good cause to reject the Proposals.
*137 9. Balance Of The Equities Must Clearly Favor Rejection
To engage in a balance of the equities with regard to the debtor's proposed rejection of a CBA, courts generally consider some or all of the following:
1) probability and consequences of liquidation if the CBA remains intact;
2) impact of the CBA remaining intact on the value of creditors’ claims;
3) probability and impact of a strike if the CBA is rejected;
4) probability and value of employees’ rejection damage claims;
5) each party’s ability to absorb and spread the costs of rejection; and
6) the parties’ good or bad faith conduct in the reorganization process.
Carey Transp., 816 F.2d at 82 ; see also In re Horsehead Indus. Inc., 300 B.R. at 585 . The court in Mesaba I notes that the likelihood and consequences of liquidation if the CBA remains intact overrides the rest of these balancing factors. Mesaba I, 341 B.R. at 757 . The court in Pinnacle also considered the “consequences of inaction” generally and the consequences of inaction to the other employees of the debtor. Pinnacle, 483 B.R. at 418 .
In this case plagued with uncertainty, there are a few certainties. One, without relief from Debtors’ current Retiree Benefit costs and CBA requirements, Debtors will be forced into liquidation. This, by all accounts, is the worst scenario. Two, if the UMWA calls a strike, especially a lengthy strike-a decision which at least initially lies with President Roberts 238 -Debtors will be forced to liquidate. The sealed record before the Court indicates that President Roberts is well aware of the gravity of the decision to strike and its consequences, and therefore whatever decision he makes will be made after careful deliberation, irrespective of the this Court’s present ruling. All evaluating this matter can see that a strike, or more importantly, Debtors’ liquidation caused by a strike, is a zero sum proposition. If Debtors liquidate, the overwhelming majority of Debtors’ current employees, which includes UMWA-represented employees, will be unemployed. There is no question that even today, numerous miners remain unemployed from the liquidation of Debtors’ former competitors, and Debtors’ employees would add to this joblessness. If there is no VEBA and Debtors liquidate, state and federal governments will likely be left to remedy the carnage, a situation which will highly likely yield the current employees and retirees less than what is proposed by Debtors today. Yet, in the wake of these cold hard realities, the UMWA takes the indefensible position that the UMWA might strike because it can, at any time it chooses-for example, before confirmation-and, as elected representatives of its membership, the decision to strike, irrespective of the consequences, is in effect the decision of its membership.
The court in Horsehead stated the following:
The [union] has stated that it will strike if the Debtors are allowed to reject their collective bargaining agreements, and force the union to accept the terms its members previously rejected. A strike is an inherent risk in every § 1113 motion, and in the end, it makes little difference if the Debtors are forced out of business because of a union strike or the continuing obligation to pay union benefits to avoid one. The unions may have the legal right to strike, but that does not mean that they must exercise that right. The union’s right to strike car *138 ries with it the burden of holding the fate of the rank and file in its hands. Little purpose would be served by a strike if a strike results in the termination of operations and the loss of jobs by the strikers.
In re Horsehead Indus., 300 B.R. at 587 . With a slightly different backdrop where the Union insisted to the court that if the 1113 motion was granted the union leadership would call a strike, the court in Mesa-ba I said:
In a way, it is almost embarrassing to see it presented in a forum that is to receive principled discourse structured by the dictates of reason. In contrast, this seems to be a matter of posturing only, and posturing in the height. One message to be gleaned from it is jarringly out of place in a legal proceeding: “If you don’t watch out, I’m really going to hurt myself, and you, too.” An image comes to mind, of standing under a high bridge, and hearing a voice coming from above: “If you don’t give me what I want, I’m going to grab you and take us both over the edge!”
In point of fact, the power to conduct a strike rests solely with the unions. That is where the impetus for one must lie— and, too, the attribution of any consequences. To raise the threat as an ostensible and compelling reason to deny the motion is truly ignoring the plank in the eye for the splinter in the finger, if the thought is that above all else it is “necessary” for the Debtor to continue operations ...
But threatening to cause a catastrophe in the wake of one outcome to the § 1113 process, and then saying that the making of the threat should conclusively deter that outcome, elevates a bullying tactic to a mask over the underlying problem. There is an aura of self-righteousness and self-possession here that borders on solipsism. And, ultimately, would the threatened outcome really be in the best interest of the regular working people who make up the unions’ locals?
Mesaba I, 341 B.R. at 747-48 (where the bankruptcy court also acknowledges that the Union may have the right to strike but that no determination concerning the interplay between the Bankruptcy Code and the Railway Labor Act would take place at that time).
Counsel for the UMWA commented that the above quote from Horsehead, and in theory Mesaba I, reads like a “1920s diatribe against the right of employees to engage in self-organization and mutual aid and protection in the form of a work stoppage” and that those courts condemned rather than balanced the likelihood of a strike in balancing the equities of the relief requested. 239 The above quotes however, with which in principle — from the perspective of bankruptcy law and its inevitable consequences — this Court must agree, is not an attack on unions or the federally protected right to strike. This Court’s criticism is of the undoubtedly lugubrious (and certain) result of any such strike, particularly a lengthy strike — Debtors’ liquidation. And, with Debtors’ liquidation comes the highly likely loss of jobs of those who need them most — the rank and file — and even less Retiree Benefits than Debtors propose today. Could this possibly be the UMWA’s desired result? It is fathomable that the UMWA might desire to bring about Debtors’ liquidation, however, the record does not logically compel this suspicious conclusion. The record indicates that the UMWA is intently deliberating what is in the best interest of its rank and file, and retirees, both in the *139 short and long-run. It is this Court’s expectation that the UMWA will, as the Court has, consider the voices of the thousands who have lined the streets of St. Louis in peaceful demonstration as well as the hundreds who have written the Court.
Again, the world of pre-October 31, 2007 is gone with the wind. Whether or not Debtors and the Official Committee of Unsecured Creditors’ pursuit of potential claims against Peabody, and perhaps Arch, will yield some recovery is unknown by all accounts, particularly the legal soundness of any potential claims, the likelihood of success, and if successful, the timing and amount of any recovery. Unity of purpose is key and it would bode well for all to stay focused on that.
So too, the Court is mindful of the cost-spreading abilities, or lack thereof, of the subject miners and retirees. But ultimately, the Court is faced with this cheerless and rather doleful question: What is better? Something for a time or nothing in a short time? Half a loaf or no loaf at all? There are no pre-bankruptcy options. The Court has almost entirely dispelled the naive hope that the parties will settle the matter. In balancing the equities of the 1113/1114 Motion, and this Court’s evaluation of the Fifth 1113 Proposal and Fifth 1114 Proposal, the various claims that will arise as a result of this Court’s ruling, the effect of the 1113/1114 Motion on Debtors’ current employees and dependent retirees, the conduct of both the UMWA and Debtors both before the 1113/1114 Motion was filed, to the inclusion of the timing of Debtors’ April 23, 2013 Fifth 1113 Proposal and its April 10, 2013 Fifth 1114 Proposal, as well as the UMWA’s April 27, 2013 Fourth Counterproposal — all three of which were before the commencement of the hearing — and with most seriousness, the potential consequences of this Court’s inaction, the Court concludes that Debtors have met their burden of persuasion in that by the preponderance of the evidence, the equities favor granting the 1113/1114 Motion.
V. CONCLUSION
Was Debtor Patriot Coal Corporation created to fail? Maybe not. Maybe. Maybe the executive team involved at Debtor Patriot Coal Corporation’s inception thought the liabilities were manageable and thus the reality of Debtors’ bankruptcy was more attributed to unwarranted optimism about future prospects. Unions generally try to bargain for the best deal for their members, however, there is likely some responsibility to be absorbed for demanding benefits that the employer cannot realistically fund in perpetuity, particularly given the availability of sophisticated actuarial analysts and cost trend experts. Further, Congress could have incorporated pre-funding requirements for health benefits as it did for pensions when Congress enacted ERISA, but it did not. “The legacy of unfunded retiree medical benefits was itself the result of Congressional inaction, a changing manufacturing landscape, and the benign neglect and false hopes of companies and unions alike.” 240
Before this Court engaged in the above application of the law, the Court posed the question: What does the Bankruptcy Code and stare decisis require? As stated by both Debtors and the UMWA, Debtors’ reorganization has many paths to failure. This Court’s task is limited to applying the law to the facts and evidence presented. So done. Therefore,
*140 IT IS ORDERED THAT the Motion to Reject Collective Bargaining Agreements and to Modify Retiree Benefits Pursuant to 11 U.S.C. §§ 1113 , 1114 of the Bankruptcy Code is GRANTED in that the Obligor Debtors are authorized to reject their collective bargaining agreements pursuant to Section 1113 of the Bankruptcy Code and implement the terms of the Fifth Section 1113 Proposal on June 1, 2013; and in that the Obligor Debtors are authorized to terminate retiree benefits for certain of their current retirees pursuant to Section 1114 of the Bankruptcy Code, implement the terms of the Fifth Section 1114 Proposal and transition the retiree health care to the UMWA Retiree Healthcare Trust, which shall be structured as a Voluntary Employee Beneficiary Association, on July 1, 2013, unless the conditions proscribed are met whereby the transition date will be January 1, 2014; and
IT IS FURTHER ORDERED THAT all objections are OVERRULED.
. At closing argument, counsel for the Official Committee of Unsecured Creditors read the following agreement into the record: The Committee, by majority vote of its unconflict-ed members, has determined to withdraw its objection to the implementation of the Fifth Proposal, based on the following agreements and reservations. The Debtors and the Committee agree that: one, the Committee's ad-visors received Blackstone’s detailed recovery analysis in the last seventy-two hours; two, the Committee’s advisors have engaged in detailed discussion with the Debtors' advisors over the last seventy-two hours to more closely reconcile their respective recovery models and the assumptions used to analyze various percentages of equity that are allocable to the UMWA in certain circumstances; three, among the assumptions affecting the allocation of equity to the UMWA are: the probable amount of the UMWA's claims, preliminary estimates of the value distributable to unsecured creditors, the allocation of that value among the various Debtors, the amount of third-party trade and litigation claims against the various Debtors, the likelihood that inter-company claims are allowed or disallowed, and the likelihood of substantive consolidation. The Committee has determined that the Fifth 1114 Proposal allocates to the UMWA approximately thirty-nine percent of the equity value of the reorganized Debtors, comprised of thirty-five percent of the equity, plus royalty and profit-sharing payments, which the Committee values as equal to an additional four percent of the equity. The Committee continues to believe that the Fifth Proposal’s allocation of thirty-nine percent of the equity value to the UMWA is high. However, after seventy-two hours of consultation and modeling by the Committee and Debtor[s'] advisory team, the Committee, by a majority vote of its unconflicted members and the Debtors have agreed that, based on the range of assumption[s] shared by Houlihan and Blackstone, even if substantive consolidation is given a zero likelihood and the disallowance of inter-company claims is given a zero likelihood, the Fifth Proposal’s allocation of equity to the UMWA is fair and equitable with respect to other creditors. Because the Committee and the Debtors have reached a mutual understanding on the basis of the Fifth Proposal’s allocation of equity to the UMWA, the Committee, by a majority vote of its unconflicted members, no longer requests proof of such basis or a second hearing on the implementation on the Fifth Proposal and withdraws that portion of its statement in support that objects to the implementation of that Proposal without proof that it treats creditors fairly and equitably. The Debtorfs] and the Committee agree that the range of assumptions shared by Houlihan and Blackstone is not an admission with respect to any assumption. Neither the Debtors nor the Committee shall be bound by any of the shared assumptions in any future litigation. The Debtors and the Committee *77 agree that the foregoing determination is without prejudice to the rights of any party with respect to substantive consolidation or the allowance of intercompany claims. The Committee has made no determination as to whether substantive consolidation or the allowance of intercompany claims is appropriate or inappropriate. 1113/1114 Hr'g Tr. 18:24-21:3, May 3, 2013.
. 1113/1114 Hr’g Tr. 169:20-170:2, April 29, 2013.
. 1113/1114 Hr’g Tr. 174:23-175:15, April 29, 2013. By agreement of Debtors and the UMWA, the Declarations, as well as the Deposition Designation of Mr. Dale Stover, witness for the 1974 Pension Trust and 1993 Benefit *78 Plan, as well as the 2012 Retiree Bonus Account Plan, were admitted.
. 1113/1114 Hr'g Tr. 109:16-22, May 3, 2013.
. Only high-ranking bituminous coal has the characteristics required to be used as coking coal.
. Mair B. Fox, United We Stand: The United Mine Wokers of America 1890-1990 22 (International Union, United Mine Workers of America 1990) (citing the UMWA Preamble, 1890).
. Joint Ex. 181, Buckner Declaration, ¶ 45.
. An Evergreen Clause has been included in every subsequent agreement between the UMWA and the BCOA. The clause provides that participating employers are bound to make continuing contributions to the 1974 Pension Plan so long as the employer remains in the coal industry and that the amounts of contribution will be as specified in future agreements. “In other words, an employer who has agreed to participate ... at any time-whether by signing a previous NBCWA as a member or non-member of the BCOA, or by signing a different agreement with the [UMWA] that requires the employer to contribute ... is bound by the rates set forth in a new NBCWA, even if that employer is not a BCOA member at the time the new NBCWA is executed, and even if that employer does not affirmatively sign on to the new NBCWA or a similar agreement.” Holland v. Freeman United Coal Mining Co., 574 F.Supp.2d 116, 120-22 (D.D.C.2008) (holding that the coal companies were bound by the Evergreen Clause and required to contribute to the Plans under the new rate).
. The Coal Act was amended in 2006. All references to the Coal Act and all quotes from its text herein are current as of the 2006 amendment.
. Coal Industry Retiree Health Benefit Act of 1992, 26 U.S.C. §§ 9701 to 9722.,
. 1891 Territorial Mine Inspection Act, § 6, 26 Stat. 1105 .
. Federal Coal Mine Safety Act of 1952, Pub. L. No. 82-552, 66 Stat. 692 (codified as amended at 30 U.S.C. §§ 451-460 , 471-483).
. The Federal Coal Mine Health and Safety Act of 1969, Pub. L. No. 91-173, 83 Stat. 742 (codified as amended at 30 U.S.C. §§ 901-04 ).
. Black Lung Benefits Reform Act of 1977, Pub. L. No. 95-239, 92 Stat. 95 (codified as amended in scattered sections of 26 U.S.C., 29 U.S.C. and 30 U.S.C. §§ 801-965 ).
. 20 C.F.R. § 725.202 (d)(2).
. North Fork Coal Corp. v. Federal Mine Safety and Health Review Comm'n, 691 F.3d 735, 738 (6th Cir.2012) (citing 30 U.S.C. § 801 (c)).
. 30 U.S.C. § 811 (a).
. Federal Mine Safety and Health Act of 1977, Pub. L. No. 95-164, 91 Stat. 1290 (codified as amended at 30 U.S.C. § 801 et seq.).
. The Surface Mining Control and Reclamation Act of 1977, Pub. L. No. 95-87, 91 Stat. 445. Congress also reiterated the need to provide health benefits to retired coal miners in the Energy Policy Act of 1992, Pub. L. No. 102-486, 106 Stat. 2776 (codified as amended in various sections of 42 U.S.C.). The Energy Policy Act was amended in 2005 to provide tax credits to companies that use clean coal technology.
. 30 U.S.C. § 1231 (a), (c).
. 30 U.S.C. § 1232 (a).
. Note the Combined Fund only concerns the 1950 and 1974 Benefit Plans. The 1950 and 1974 Pension Plans remain separate.
. 26 U.S.C. § 9702 (a)(3)(B).
. 26 U.S.C. § 9712 .
. Federal contributions were 25% in 2008 and were projected to increase by 25% annually thereafter.
. Mine Improvement and New Emergency Response Act of 2006, Pub. L. No. 109-236, 120 Stat. 493 (partially codified in scattered sections of 29 and 30 U.S.C.).
. The Pension Protection Act of 2006, Pub. L. No. 109-208, 120 Stat. 780 (codified in scattered sections of 26 U.S.C.).
. The Tax Relief and Health Care Act of 2006, Pub. L. No. 109-432, 120 Stat. 2922 (codified at 26 U.S.C. § 1 NOTE).
. Joint Ex. 260.
. Joint Ex. 264; Stover Declaration in Support of Objection and Joinder of the United Mine Workers of America 2012 Retiree Bonus Account Trust (hereinafter "Stover 2012 Re *86 tiree Bonus Declaration”), ¶ 7. Mr. Dale Sto-ver is the Director of Finance and General Services for the UMWA Health & Retirement Funds and this Court has admitted his Declarations and Deposition Designation into evidence without objection.
. Joint Ex. 264, Stover 2012 Retiree Bonus Declaration, ¶ 9.
. Joint Ex. 257, Stover Declaration in Support of Objection of the UMWA 1974 and 1993 Plans (hereinafter "Stover 1974/1993 Declaration”), ¶ 9.
. Stover Dep. 33:19, April 16, 2013.
. Joint Ex. 257, Stover 1974/1993 Declaration, ¶ 17.
. Joint Ex. 257, Stover 1974/1993 Declaration, ¶ 13.
. Stover Supplemental Declaration, ¶ 4 [ECF No. 3919],
. Joint Ex. 257, Stover 1974/1993 Declaration, ¶ 13.
. Limited coverage under a separate program of benefits was provided for retirees of employers who did not contribute substantially all amounts owed to the 1993 Benefit Plan.
. Joint Ex. 261.
. Joint Ex. 260, at p. 173.
. Joint Ex. 257, Stover 1974/1993 Declaration, ¶ 37.
. Joint Ex. 257, Stover 1974/1993 Declaration, ¶ 39.
. Joint Ex. 257, Stover 1974/1993 Declaration, ¶ 38.
. Joint Ex. 264, Stover 2012 Retiree Bonus Declaration, ¶ 12.
. Joint Ex. 264, Stover 2012 Retiree Bonus Declaration, ¶ 13.
. See February 22, 2013 Press Release: Rockefeller Defends Retired Coal Miners' Benefits, http://www.rockefeller.senate.gov/ public/index.cfm/press-releases?ID=6fed 7356-26cd-4955-8348-6f8f2ce939de, last visited May 11, 2013; see also Stover Dep., 55:10-25, April 16, 2013.
. Joint Ex. 159, Hatfield Declaration, ¶ 15.
. Joint Ex. 159, Hatfield Declaration, ¶ 16.
. Joint Ex. 162, Peabody Form 8-K, October 22, 2007.
. This Court will discuss the separately filed adversary concerning the Peabody-Assumed Group below.
. See Ex. E to Debtor Patriot Coal Corporation’s Motion for Summary Judgement in Adversary 13-4067, Peabody Form 10-K, December 31, 2007, p. 17.
. Those three subsidiaries also include the following mining operations: Hobet 21, Arch of West Virginia, Samples and Campbells Creek.
. Joint Ex. 160, Amended Traynor Declaration, ¶ 15.
. See Joint Ex. 265; Whiting Dep. 59:9-61:4, 63:17-34:4, April 22, 2013.
. Joint Ex. 159, Hatfield Declaration, ¶¶ 16-17.
. Joint Ex. 159, Hatfield Declaration, ¶¶ 19-20.
. Joint Ex. 159, Hatfield Declaration, ¶ 9; Joint Ex. 135, Schwartz Declaration, II 12.
. Joint Ex. 159, Hatfield Declaration, ¶ 10.
. Joint Ex. 159, Hatfield Declaration, V 10 n.4.
. Joint Ex. 159, Hatfield Declaration, ¶ 12.
. Joint Ex. 159, Hatfield Declaration, ¶ 12 n.5.
. Joint Ex. 159, Hatfield Declaration, ¶ 12.
. Joint Ex. 159, Hatfield Declaration ¶ 12.
. Joint Ex. 159, Hatfield Declaration, ¶¶ 40-56; Joint Ex. 135, Schwartz Declaration, ¶¶ 13-22, 28-40, 42-50.
. Joint Ex. 159, Hatfield Declaration, ¶ 40.
. Joint Ex. 159, Hatfield Declaration, ¶¶ 95-96.
. Joint Ex. 159, Hatfield Declaration, ¶ 95(b); Joint Ex. 97, Lucha Declaration ¶ 15.
.Debtors also cite other anticipated health care related losses of revenue, namely, that because the Early Retiree Reinsurance Program exhausted its pool of funds in 2011, Debtors will no longer receive any refunds from this Program going forward. In 2010 and 2011, Debtors received $7.6 million dollars in refunds from this Program. Debtors also state that under the Patient Protection Affordable Care Act, Debtors will be required to cover an additional 440 dependents of employees who are under the age of 26 — an *92 expense Debtors today estimate to cost an additional $1.5 million dollars.
. Joint Ex. 97, Lucha Declaration ¶¶ 31-35.
. Joint Ex. 97, Lucha Declaration ¶¶ 33-34.
. Joint Ex. 119, Huffard Declaration ¶ 63 (where the Other Post-Employment Benefits of Debtors in relation to some of Debtors' competitors is discussed, compared and contrasted).
. Joint Ex. 119, Huffard Declaration ¶ 17.
. Joint Ex. 119, Huffard Declaration ¶¶21-25.
. Joint Ex. 159, Hatfield Declaration, ¶ 43; Joint Ex. 135, Schwartz Declaration, ¶ 29; Joint Ex. 119, Huffard Declaration ¶ 22.
. Joint Ex. 119, Huffard Declaration, ¶ 24 (Graph 6).
. Joint Ex. 159, Hatfield Declaration, ¶ 57; Joint Ex. 119, Huffard Declaration, ¶ 73.
. Joint Ex. 159, Hatfield Declaration, ¶¶ 46-51; Joint Ex. 135, Schwartz Declaration, ¶¶ 23-25; Joint Ex. 119, Huffard Declaration, ¶¶ 13-15.
. Joint Ex. 159, Hatfield Declaration, ¶¶ 49-50.
. Joint Ex. 159, Hatfield Declaration, ¶¶ 73-81; Joint Ex. 135, Schwartz Declaration, ¶¶ 23-27.
. Joint Ex. 159, Hatfield Declaration, ¶ 75-76.
. Joint Ex. 159, Hatfield Declaration, ¶ 77.
. Joint Ex. 159, Hatfield Declaration, ¶¶ 83-85.
. Joint Ex. 159, Hatfield Declaration, ¶ 92(a).
. Joint Ex. 159, Hatfield Declaration, ¶ 90(a).
. See generally Joint Ex. 159, Hatfield Declaration, ¶ 91(c).
. Joint Ex. 159, Hatfield Declaration, ¶ 91(a).
. Joint Ex. 159, Hatfield Declaration, ¶ 91(d).
. 1113/1114 Hr’g Tr. 30:2-21, April 30, 2012.
. See Final Order (I) Authorizing Debtors (A) To Obtain Post-Petition Financing Pursuant to J1 U.S.C. §§ 105, 361, 362, 364(c)(1), 364(c)(2), 364(c)(3), 364(d)(1) and 364(e), and (B) To Utilize Cash Collateral Pursuant to 11 U.S.C. § 363 and (II) Granting Adequate Protection to Pre-Petition Secured Lenders Pursuant to 11 U.S.C. §§ 361 , 362, 363 and 364, § 5, August 3, 2013 [ECF No. 275].
.Joint Ex. 119, Huffard Declaration, ¶ 44.
. Joint Ex. 1, Robertson Declaration, ¶ 21.
. Joint Ex. 10.
.Joint Ex. 13.
. Joint Ex. 79.
. See Joint Ex. 80 (where PPACA is discussed).
.Joint Ex. 88 (regarding Debtors' response to the UMWA’s request for PPACA information).
. Joint Ex. 75.
. Joint Ex. 1, Robertson Declaration, ¶ 14.
. Joint Ex. 19.
. Joint Ex. 24.
.Many of Mr. Mandarino’s assumptions are based on conclusions made by another UMWA witness, Mr. Srinivas Akunuri, whose testimony will be discussed below.
. 1113/1114 Hr’g Tr. 197:3-198:17, May 2, 2013.
. See Joint Ex. 1, Robertson Declaration; Joint Ex. 73, Robertson Reply Declaration; 1113/1114 Hr'g Tr. 189:2-227:22, April 29, 2013.
. See Joint Ex. 160, Traynor Declaration; 1113/1114 Hr'g Tr. 188:11-265:24, May 1, 2013.
. See Joint Ex. 135, Schwartz Declaration; Joint Ex. 148, Schwartz Reply Declaration; 1113/1114 Hr’g Tr. 191:25-281:8, April 30, 2013.
. See Joint Ex. 204, Akunuri Declaration; 1113/1114 Hr’g 281:16-340:8, May 1, 2013.
. Joint Exs. 5 and 6.
. Joint Ex. 49.
. Joint Ex. 4; Joint Ex. 54 (letter where Second Proposals are discussed).
. Joint Ex. 59.
. Joint Ex. 3.
.Joint Ex. 2.
. Joint Ex. 83.
. Joint Ex. 74.
. Joint Ex. 75 (with transmittal letter from Mr. Hatfield to President Roberts).
. Joint Ex. 290.
. Joint Ex. 73, Robertson Reply Declaration, ¶ 32.
. As will be noted, this component is altered by the Fifth 1113 Proposal.
. Unionized employees previously enjoyed John L. Lewis Day (April 1) in honor of the former UMWA president and each employee's own birthday as a paid holiday.
. Certain experienced miners have as many as 47 days off per year under the CBAs (including holidays) or 36 days per year (excluding holidays). These individuals however are small in number.
.Mr. Lucha testified that under the current attendance policy, in the event of three (3) unexcused absences in 30 days or six (6) unexcused absences in 180 days, the employee will go into a probationary program whereby they need to work 180 days without any absences, and if the employee fails to do this, they will go into a new phase where they need to go 180 days without unexcused absences, and if they employee fails at that time, they may be terminated. See 1113/1114 Hr'g Tr. 354:3-17, April 30, 2013.
. Joint Ex. 73, Robertson Reply Decl. ¶¶ 40-41.
. Health insurance exchanges are government-regulated and standardized health care plans which must be fully certified and operational by January 1, 2014. The federal government contemplates a health insurance marketplace or “exchange” where individuals and small business can buy affordable and qualified health benefit plans.
. Terry Dep. 142:20-143:20, April 11, 2013.
. 1113/1114 Hr’g Tr. 321:9-21, April 30, 2013.
. 1113/1114 Hr'g Tr. 332:5-333:21, April 30, 2013.
. See Joint Ex. 97, Lucha Declaration; Joint Ex. 112, Lucha Reply Declaration; *109 1113/1114 Hr’g Tr. 340:7-382:3, April 30, 2013.
.Joint Ex. 252.
. See Joint Ex. 235, Cobin Declaration; 1113/1114 Hr’g Tr. 82:23-139:20, May 2, 2013.
. Joint Ex. 290.
. Joint Ex. 181, Buckner Declaration; 1113/1114 Hr'g Tr. 17:25-81:11, May 2, 2013.
. See also Joint Exs. 266 and 267 (where ALCOA obligations to finance Squaw Creek retirees is discussed).
. Joint Exs. 5 and 6.
. Joint Ex. 49.
. Joint Ex. 4; Joint Ex. 54 (letter where second proposal is discussed).
. Joint Ex. 59.
. Joint Ex. 3.
.Joint Ex. 2.
. Joint Ex. 83.
. Joint Ex. 74.
. Joint Ex. 75 (with transmittal letter from Mr. Hatfield to President Roberts).
. Joint Ex. 290.
. Joint Ex. 19; see also Ex. E to Mandarino Declaration.
. See 1113/1114 Hr'g Tr. 197:3-198:17, May 2, 2013.
. 1113/1114 Hr’g Tr. 199:21-200:25, May 2, 2013.
. Joint Ex. 8.
. Joint Ex. 9.
. Joint Ex. 10.
. Joint Ex. 11.
. Joint Ex. 13.
. Joint Ex. 14.
. Joint Ex. 15.
. Joint Ex. 17.
. Joint Ex. 18.
. Joint Ex. 19; Exhibit E to Mandarino Declaration.
. Joint Ex. 20.
. Joint Ex. 21.
. Joint Ex. 22.
. Joint Ex. 23.
. Joint Ex. 24.
. Joint Ex. 25.
. Joint Ex. 26.
. Joint Ex. 27.
. Joint Ex. 28.
. Joint Ex. 29.
. Joint Ex. 30.
. Joint Ex. 31.
. Joint Ex. 32.
. Joint Ex. 33.
. Joint Ex. 34.
. Joint Ex. 35.
. Joint Ex. 36.
. Joint Ex. 37.
. Joint Ex. 38.
. Joint Ex. 39.
. Joint Ex. 40.
. Joint Ex. 41.
. Joint Ex. 42.
. Joint Ex. 43.
. Joint Ex. 44.
. Joint Ex. 45.
. Joint Ex. 46.
. Joint Ex. 47.
. Joint Ex. 48.
. Joint Ex. 77.
. Joint Ex. 49.
. Joint Ex. 50.
. Joint Ex. 51.
. Joint Ex. 52.
. Joint Ex. 53.
. Joint Ex. 54.
. Joint Ex. 55.
. Joint Ex. 56.
. Joint Ex. 57.
. Joint Ex. 58.
. Joint Ex. 59.
. Joint Ex. 60.
. Joint Ex. 61.
. Joint Ex. 62.
. Joint Ex. 63.
. Joint Ex. 64.
. Joint Ex. 65.
. Joint Ex. 66.
. Joint Ex. 67.
. Joint Ex. 68.
. Joint Ex. 69.
. Joint Ex. 70.
. Joint Ex. 71.
. Joint Ex. 72.
. Joint Ex. 76.
. Joint Ex. 78.
. Joint Ex. 79.
. Joint Ex. 81.
. Joint Ex. 82.
. Joint Ex. 83.
. Joint Ex. 84.
. Joint Ex. 85.
. Joint Ex. 86.
. Joint Ex. 88.
. Joint Ex. 89.
. Joint Ex. 169.
. Joint Ex. 170.
. Joint Exs. 171 and 267.
. Joint Ex. 174.
. Joint Ex. 175.
. Joint Ex. 291.
. Joint Ex. 292.
. Joint Ex. 293.
. See 1113/1114 Hr'g Tr. 274:7-24, May 2, 2013.
. See 1113/1114 Hr’g Tr. 275:6-12, May 2, 2013.
. The Court also acknowledges the comments made by counsel for Bank of America that it would not waive any of the covenants contained in its DIP Facility during this Court's April 23, 2013 hearing on the Motion to Appoint a Chapter 11 Trustee. See Hr'g Tr. 150:11-19, April 23, 2013.
. It is also suggested to the Court that any such installment payments will be in an amount certain that will be sufficient only to satisfy the interest of Debtors’ obligation, therefore, those payments will likely continue in perpetuity.
. The strip ratio is the amount of rock that needs to be removed per ton of coal produced.
. There was some argument that the proposed modifications to the CBAs are fair and equitable because they are generally similar to the employment agreements at Debtors’ Gateway mines. This Court gives this comparison little weight because the record is clear that the Gateway mines are relatively small and that there were acute circumstances that surrounded the negotiations of the Gateway employment agreements. The Court therefore does not consider the Gateway employment contracts or the surrounding circumstances to be comparable to the matter before the Court.
. The Court acknowledges that Mr. Traynor testified that he believes Debtors' post-filing proposals, particularly the Fourth 1113 Proposal and Fifth 1114 Proposal, as well as Debtors' Fifth 1113 Proposal to be made in bad faith in that Debtors’ timing was tactical. Mr. Traynor however does not believe that the Fourth Counterproposal made by the UMWA on April 27, 2013, two days before the commencement of the hearing, to have been made in bad faith. The statute does not support Mr. Traynor’s position in that there are no timing requirements for Section 1113 or 1114 motions under the Bankruptcy Code. The mere fact that most of the movement towards a resolution took place within the final weeks before the commencement of the hearing is of no consequence because the Bankruptcy Code contemplates that negotiations continue until the commencement of the hearing. So too, the Bankruptcy Code contemplates that the hearing could commence as early as 14 days after the motion is filed. Further acknowledgment of Mr. Traynor's challenge to Debtors’ good faith would leave the Court to also evaluate the excessive time that lapsed before the UMWA derived its First Counterproposal and the modest concessions the UMWA was willing to make, the length of time that the UMWA took to respond to Debtors' requests for information and of course the good faith effort of the UMWA to achieve a mutually satisfactory resolution based on the unreasonable contents of the Fourth Counterproposal.
. See Joint Ex. 290, Section IV, C, 1.
. Joint Ex. 87.
. Roberts Dep. 54:7-55:16, April 19, 2013.
. 1113/1114 Hr'g Tr. 103:1-22 May 3, 2013.
. Daniel Keating, Transforming a Non-Claim into a Claim: §1114 and the Curious Case of In re Visteon, 85 Am. Bankr. L.J. 1 , 8 (2011).

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/8495962. Public record. Not legal advice.