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Financier Carl Icahn will have a difficult time saving his plum ticket purchase agreement with Trans World Airlines Inc., lawyers say, despite clauses that supposedly protect the pact from bankruptcy. Meanwhile, another airline said Wednesday it may bid for some of TWA’s assets. Icahn is opposing AMR Corp.’s $3.5 billion cash and debt offer for the ailing St. Louis carrier. AMR, the parent of American Airlines Inc., plans to pluck most of TWA’s assets out of bankruptcy. Icahn’s paramount concern is an agreement that lets him buy more than $610 million in TWA tickets at steep discounts. AMR has said it does not plan to honor that contract. Ed Weisfelner, Icahn’s lawyer and a partner at the New York firm Berlack, Israels & Liberman, has said Icahn may sue TWA for violating those provisions when it filed for Chapter 11 bankruptcy protection last week. But several legal experts said Wednesday he will have a tough time proving his case. “Icahn’s really got a problem,” one legal expert said. “There is no way a company can be made to waive its bankruptcy rights.” TWA agreed to the ticket-purchase pact in 1995 in exchange for extending the life of a $190 million loan from Icahn, who once owned the airline. The pact includes clauses that explicitly state TWA cannot get out of the agreement by filing for bankruptcy and that anyone who buys TWA must honor it. The agreement is set to expire in September 2003. Despite those provisions, American Chief Executive Donald Carty has said the company will not honor the contract. Barry Dichter, a bankruptcy lawyer at Cadwalader, Wickersham & Taft who has not worked on the deal, agreed. Courts have regularly overturned provisions that try to circumvent bankruptcy law, he said. “The reasoning of these cases is that, if you start down that road, you could eviscerate the bankruptcy code,” Dichter said. “Debtors are entitled to a fresh start.” Nonetheless, Icahn’s opposition has emerged as a roadblock that could at least delay closing of the AMR-TWA deal. Icahn is putting together a rival plan for TWA, and plans to ask the U.S. District Court in Wilmington, Del., which is hearing the case, to throw out several deal protections meant to discourage outside bids for TWA. Icahn’s objections will be considered at a series of hearings late next week. Continental Airlines Inc. could also enter the picture. Gordon Bethune, Continental’s chief executive, said Wednesday he would be interested in buying some TWA slots — which are airport takeoff and landing privileges. He noted Continental had passed up an opportunity to buy all of TWA before it declared bankruptcy. “We are looking at what is available to us,” Bethune said. “We haven’t decided in which location and which slots we’re interested in, but we are interested in one or two things.” A Continental spokesman declined to say whether Icahn has contacted the company. Icahn and Weisfelner did not return calls placed Wednesday seeking comment. Copyright (c)2001 TDD, LLC. All rights reserved.

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