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UAL seeks exclusivity extension
By Jeff Pines
Washington, Feb. 9 - UAL Corp. wants an extension on its exclusivity periods to June 30 for filing its reorganization plan and Aug. 30 for soliciting votes, according to a Feb. 6 filing with the U.S. Bankruptcy Court for the Northern District of Illinois, Eastern Division.
The deadline for filing objections is Feb. 13, and the hearing date is Feb. 20.
UAL, the parent of United Airlines, Inc., has previously asked for two extensions citing the size and complexity of its case.
The company said it remains on track to emerge from Chapter 11 later this year, but certain "key remaining restructuring initiatives, though nearing completion, remain unresolved."
Even so, the company said it can meet the March 8 deadline for filing its reorganization plan, but many of the stakeholders "could reap significant benefits," with an extension. The deadline for soliciting votes is May 7.
One of the key concerns is the status of UAL's application for a federal loan guarantee with the Air Transportation Stabilization Board. UAL has conditional commitments from JPMorgan Chase and Citigroup for $2 billion in exit financing.
In addition, there is pending municipal bond litigation involving about $1.7 billion in principal UAL is on the hook for. The company wants to recharacterize the obligations under the facilities as prepetition unsecured general claims. Some of the cases are at the summary judgment stage, but others are at the pleading stage.
"After all $1.7 billion in potential obligations (or the absence thereof) will have a measurable effect on any plan," UAL said.
UAL filed for bankruptcy on Dec. 9, 2002. The case number is 02-48191.
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