"United hopes debt plan will fly"

Friday, October 15, 2004

United hopes debt plan will fly 
BY MARY WISNIEWSKI
The Chicago (IL) Sun-Times


United Airlines reached an agreement with creditors that, if approved, could
eliminate $450 million of debt.

The agreement concerns $600 million in municipal bond debt the bankrupt
United incurred for improvements at O'Hare Airport. Under the proposed
agreement, which has to be approved by the U.S. Bankruptcy Court, the Elk
Grove Village-based airline would issue $150 million in new debt upon its
reorganization.

The agreement would remove about 75 percent of the O'Hare bond debt from
United's balance sheet, according to a United bankruptcy court filing.

A spokesman for United was not immediately available for comment.

The proposed agreement is between United Airlines, the bondholders and the
trustees.

An agreement was not reached with the City of Chicago, which claims it could
take away United's gates and leased space if it does not meet bond
obligations. While the city has no plans to "run out and do this," it wants
a ruling that it is the only party entitled to enforce this part of the
agreement, said city law department spokeswoman Jennifer Hoyle.

United's motion to approve the settlement will be heard by U.S. Bankruptcy
Judge Eugene Wedoff on Dec. 17.


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