- - Eastern Airlines Facing Bankruptcy In 1986, Eastern Airlines was in desparate trouble. The fourth quarter of 1985 had shown a $67.4 million loss, and financially experts had told Frank Borman, president and chief executive officer, that the airline had three choices: 1) a 20 percent pay cut for all union and noncontract employees. 2) Filing for Chapter 11 (bankruptcy) or 3) Selling the airline. On February 23, 1986, Eastern's board of directors met to decide the fate of the company. Frank Borman, quickly left …showed first 75 words of 1242 total…

…showed last 75 words of 1242 total…pay decrease. Charlie went off on a huddle with his lawyers and returned to reject the proposal. At 3 a.m. Eastern Airlines sold the company to Texas Air with a vote to sell was 15 to 4. All four union directors. Byran included included against the merger. The major management problem concerned here is that management was unable to get the IAM union to negotiate proposal in wage deceases which lead to the selling of the company.