The trustee overseeing American Airlines' bankruptcy has asked the carrier to justify its offer of $19.9 million in severance pay to Chief Executive Tom Horton, part of compensation linked to its merger with US Airways Group .

Trustee Tracy Hope Davis said in a filing on Friday to the U.S. Bankruptcy Court in New York that American had not explained why that level of severance pay and "sweeping changes" to various employee pay programs were permissible under the bankruptcy code.

The merger of American parent AMR Corp and US Airways, announced on February 14 and subject to various approvals, would create the world's largest air carrier.

Horton, who became American chairman and CEO at the time of the carrier's Chapter 11 filing in November 2011, is due to serve as chairman of the new American Airlines Group Inc until the first annual meeting of shareholders in 2014. US Airways CEO Doug Parker will be CEO of the merged company.

American spokesman Andy Backover said in a statement the carrier did not believe the objection filed by the U.S. Trustee's office had merit. The matter is scheduled to be considered by the U.S. Bankruptcy Court on March 27.

The company said the proposed employee arrangements were found to be reasonable by pay consultants retained by its unsecured creditors committee.

It added that the payments would "motivate a strong management team during the integration process" to make the merger a success.

The merger is expected to close in the third quarter.

(Reporting by Karen Jacobs in Atlanta; Editing by Stephen Coates)

Also on HuffPost:

Loading Slideshow...
  • General Motors

    Two years after General Motors' bailout, executives received around <a href="http://abcnews.go.com/Business/gm-ford-chrysler-boeing-unions-score-big-bonuses/story?id=15724619#.ULefSNPjnoo">$32.8 million in bonuses</a>, ABC reports.

  • Kodak

    After Kodak declared bankruptcy earlier this year, executives were <a href="http://www.huffingtonpost.com/huff-wires/20120430/us-kodak-bankruptcy/">paid around $13.5 million in bonuses</a>, the Associated Press reports.

  • Solyndra

    Earlier this year, Solyndra gave their executives bonuses on top of huge pay raises <a href="http://www.washingtontimes.com/news/2012/feb/22/bonuses-given-after-raises-at-solyndra/?page=all">after the company declared bankruptcy</a>, the Washington Times reports.

  • RG Steel

    Managers at RG Steel were offered around <a href="http://www.heraldstaronline.com/page/content.detail/id/575929/Bonuses-OK-d-in-RG-Steel-s-liquidation.html?nav=5010">$20 million in bonuses</a> if they could find buyers after the company went bankrupt, The Herald Star reports.

  • Lear Corporation

    The Lear Corporation sought permission to give their executives <a href="http://online.wsj.com/article/SB10001424053111903703604576584480750545602.html">$20.6 million in bonuses</a> last January, the Wall Street Journal reports.

  • LightSquared

    Last month, LightSquared <a href="http://www.bloomberg.com/news/2012-10-23/lightsquared-wins-court-approval-of-executive-bonus-plan.html">got court approval to give bonuses </a>to four executives shortly after declaring bankruptcy, Bloomberg reports.

  • Tribune Co.

    Last year, Tribune Co. got permission to give executives millions of dollars in bonuses <a href="http://www.huffingtonpost.com/2011/10/05/tribune-bonuses-to-execut_n_995856.html">if they completed certain financial goals</a> after the organization had filed for bankruptcy.