This information is no longer current - it is for reference only. It is an archive review of events that took place during United Airline's Chapter 11 Bankruptcy from December 9, 2002 - February 1, 2006.

Court Transcript -- April 30, 2003

Page updated: April 30, 2003

0001
 1          IN THE UNITED STATES BANKRUPTCY COURT
                NORTHERN DISTRICT OF ILLINOIS
 2                     EASTERN DIVISION
 3   
     In the Matter of:         )  No. 02 B 48191
 4                             )  Judge Wedoff
     UAL CORPORATION,          )  April 30, 2003
 5                             )  5:30 p.m.
            Debtor.            )
 6   
                  TRANSCRIPT OF PROCEEDINGS
 7          BEFORE THE HONORABLE EUGENE R. WEDOFF
 8   
     APPEARANCES:
 9   
     MR. JAMES H. M. SPRAYREGEN
10   MR. ALEX DIMITRIEF
     MR. DAVID R. SELIGMAN
11   on behalf of the debtors;
12   MR. WILLIAM P. SMITH
     on behalf of Bank of New York as Indenture Trustee;
13   
     MR. BRUCE H. SIMON
14   on behalf of ALPA;
15   MR. FRUMAN JACOBSON
     on behalf of the Creditors Committee;
16   
     MR. HAROLD KAPLAN
17   MR. MARK HEBBEIN
     on behalf of HSBC, as Trustee.
18   
19          Court Reporter:  Carol Raber
                             219 S. Dearborn, #667
20                           Chicago, IL  60604
                             (312) 953-6272 
21   
22   
23   
24   
25   
0002
 1            THE CLERK:  UAL Corporation, 02 B 48191.
 2            MR. SPRAYREGEN:  Good afternoon, your 
 3   Honor.  James Sprayregen on behalf of the debtors 
 4   and debtors in possession. 
 5                Would you like me to wait for the 
 6   people to finish signing in, or --
 7            THE COURT:  Yes, I think it would be 
 8   courteous to them if you'd let them do that. 
 9                I apologize to everyone who is not 
10   able to get a seat.  Obviously, we're strained in 
11   our capacity here and we'll try to get these 
12   proceedings over with as quickly as possible so 
13   that you're not made unduly uncomfortable.
14                I would ask, though, if anyone needs 
15   to carry on a conversation, if you could do that in 
16   the hallway, I would appreciate it.  
17                        (Lengthy pause.)
18            THE COURT:  I'm really serious about that.  
19   If you carry on conversations in the hallway, it 
20   makes it a lot easier for us to conduct business 
21   here.
22                        (Lengthy pause.)
23            THE COURT:  Mr. Sprayregen.
24            MR. SPRAYREGEN:  Good afternoon, your 
25   Honor. 
0003
 1                One, we apologize for the delay; and, 
 2   two, I think on behalf of the company and all the 
 3   people in the courtroom, we appreciate your coming 
 4   back early from the conference for this. 
 5                Your Honor, we're here today to 
 6   present the motion for approval of the company's 
 7   agreements, the re-structured agreements, with its 
 8   unions.
 9                The way I would propose to proceed is 
10   to have a few procedural remarks.  Mr. Dimitrief is 
11   going to present the motion.  We expect some 
12   limited objection to some of the bankruptcy aspects 
13   of the relief requested, and I would propose at the 
14   appropriate time to address those.
15                We did, per the protocol, agree at the 
16   April 16 proceedings, serve the ratified ALPA 
17   agreement or posted it on the web site.  And last 
18   night, after we were informed of the ratifications 
19   by AFA and IAM, posted those on the web site.  We 
20   filed the motion this morning, also as discussed at 
21   the April 16 hearing.
22                And with that, I would turn it over to 
23   Mr. Dimitrief to proceed.
24            THE COURT:  Fine.
25            MR. DIMITRIEF:  Thank you, your Honor. 
0004
 1   Alex Dimitrief on behalf of the debtors. 
 2                The consensual agreements being 
 3   presented to the Court this afternoon represent 
 4   tremendous progress for United Airlines.  They are 
 5   a major step forward in making United a more 
 6   competitive enterprise and represent a collective 
 7   accomplishment by United's employees and management 
 8   that few thought would be possible when these 
 9   proceedings began December 2002. 
10                This process has not been easy for 
11   anyone involved.  And on behalf of Glenn Tilton and 
12   the other officers of United Airlines, we would 
13   like to thank the employees at all levels of United 
14   Airlines who have agreed to make sacrifices in 
15   order to deal with the difficult circumstances that 
16   required United to file for bankruptcy back in 
17   December 2002. 
18                In this and in other respects, the 
19   agreements are a tribute to the leadership of 
20   United's unions.  The employees of United are 
21   making a significant contribution to the successful 
22   transformation of United Airlines into a 
23   sustainable and profitable business. 
24                The agreements being presented to your 
25   Honor for approval not only provide substantial and 
0005
 1   necessary cost savings, they also give United 
 2   greater flexibility that is critical to its 
 3   long-term success.  The works, rule, and scope 
 4   changes are dramatic and they are durable. 
 5                To be sure, United continues to face 
 6   extraordinary short-term challenges that are 
 7   presently endemic to the entire airline industry.  
 8   With this Court's approval of the restructuring 
 9   agreements, however, the management employees of 
10   United Airlines will be able to meet and overcome 
11   these challenges with a common purpose and a 
12   determination to prevail.
13                And on behalf of all of the 
14   professionals and everyone else who has been 
15   involved in the Section 1113 process, we would like 
16   to thank your Honor and the court staff for your 
17   patience that you have displayed in stewarding us 
18   through this process to date.
19            THE COURT:  Thank you. 
20                There are objections to be heard?
21            MR. SMITH:  There are, your Honor. 
22                Your Honor, my name is Bill Smith.  
23   I'm here on behalf of the Bank of New York.  We are 
24   indentured trustee for 100 percent of the corporate 
25   taxable debt; that is the bonds, the notes and 
0006
 1   debentures which trade publicly.  We are also 
 2   indentured trustee for certain bonds issued to 
 3   finance improvements at JFK and O'Hare and at San 
 4   Francisco.  The Bank of New York collectively 
 5   represents unsecured claims against United Airlines 
 6   of $1.87 billion.
 7                As your Honor will recall from our 
 8   chamber's conference on the 16th, we indicated to 
 9   you, and we wish to reiterate, that these 
10   agreements represent milestones in the history of 
11   this particular corporation and, we think, in the 
12   history of the main line network air carrier 
13   business.  The work that has been done by the 
14   company and by the unions is extraordinary. 
15                Bank of New York sits on the Creditors 
16   Committee and we are privileged to work with the 
17   union members.  And they have indicated to us in 
18   graphic detail the sacrifices which the union 
19   members have made as a consequence of these 
20   agreements.  The effect is real, it is personal, 
21   and we understand that completely.
22                Having said that, we do have, however, 
23   have a few minor quarrels with the debtors' motion.  
24   There are two issues that trouble us, your Honor.  
25   First, obviously, is notice. 
0007
 1                The notice, as you will recall, was 
 2   served the afternoon of April 18th.  It is two 
 3   pages in duration.  It makes reference to certain 
 4   web sites where information may be obtained.  And 
 5   the motion, the actual motion itself, wasn't served 
 6   until, at least in my case, 12:40 p.m. this 
 7   afternoon.  The attachments to the motion weren't 
 8   served until 1:51 p.m. this afternoon.  The 
 9   substance of the attachments were available on the 
10   debtors' web site at 10:43 a.m. this morning.
11                As we appreciate the relief which is 
12   being requested, you're being asked to approve 
13   under Section 363 these agreements.  The Section 
14   363 process, as you have suggested in your 
15   Telesphere opinion, requires the Court to make an 
16   assessment.  And we suggest to your Honor that you 
17   do not have an adequate basis on which to make such 
18   an assessment, at least with respect to one portion 
19   of these agreements.
20                The company and the unions have 
21   negotiated hard and long, and they have come up 
22   with a formula for the allowance of consideration 
23   to go to them.  The considerations expressed in 
24   diverse attachments to diverse agreements; but, in 
25   effect, it creates a formula for allowance of a 
0008
 1   prepetition unsecured claim.  And the allowance is 
 2   roughly the average savings over the six years of 
 3   the agreement for 30 months or two-and-a-half-years 
 4   of the savings.
 5                The savings are to be calculated 
 6   pursuant to labor model 1.1A, which, as we 
 7   appreciate it, is it an Excell spread sheet which 
 8   exists in the mind of UAL staffers and, presumably, 
 9   in some of the union bargaining representatives, 
10   but which is particularly opaque to us. 
11                And as we apply as what we can 
12   appreciate to the formula to the aggregate amount 
13   of the savings in the amounts to be publicly 
14   announced, we have a significant difficulty 
15   determining the scope of the claims that result 
16   from this.
17                If you simply do the math as set forth 
18   in the motion, you can come to the conclusion that 
19   one effect of these agreements is allowance in 
20   aggregate of a claim of approximately $6.3 billion 
21   as an unsecured claim in the case, with a 
22   protective formula that in the event that a plan 
23   sponsored by United, or proposed, does not include 
24   these savings, there is to be an allowed unsecured 
25   claim of 110 percent of that amount.
0009
 1                The claim is spread among the various 
 2   unions.  And in fairness to the company and the 
 3   unions, it includes the number I have you includes 
 4   the management portion as well.  If you were to 
 5   subtract out the management portion, our best math 
 6   indicates that the effect is an allowance of a 
 7   claim of $5.497 billion as an unsecured claim.
 8                We suggest to your Honor that that may 
 9   very well be the right amount, but we don't know.  
10   There is no question that the unions have 
11   sacrificed, will sacrifice, and should receive an 
12   unsecured claim in some form; and, indeed, we 
13   commend that to you.  It's not that we object to a 
14   claim.  It is simply we are not able to calculate 
15   the claim.  And in the inability to calculate the 
16   claim, you end up with a difficulty knowing 
17   precisely what it is we're doing here today other 
18   than, hopefully, saving United as a main line 
19   network carrier.
20            THE COURT:  Let me interpret you for just 
21   a second.  You say you can't calculate the claim, 
22   but you've just done it.
23            MR. SMITH:  I have calculated the claim, 
24   your Honor, based on a series of assumptions, none 
25   of which, in candor, I can verify. 
0010
 1                What I've done in order to calculate 
 2   the claim is I've taken the amounts which are cited 
 3   in paragraph 14 of the debtors' motion; I have 
 4   added them together, the total is 2.533 billion; 
 5   I've then multiplied that -- I divided that amount 
 6   by 12, since they are expressed as annual savings, 
 7   and I've multiplied it by 30. 
 8                Because I don't know what is in labor 
 9   model 1.1A, I don't know whether this is measuring 
10   or whether these savings represent United as it 
11   existed on December 9th, as it exists today, or as 
12   it will exist at some point in the future.  I don't 
13   know the underpinnings of what assumptions are 
14   made.  I don't know whether it is reasonable to 
15   allow a claim in the amount of 30 months.  Under 
16   these circumstances, there's a whole host of 
17   questions in effect. 
18                For allowance of a claim which, let's 
19   be honest, as large as United is, is a 
20   heart-stopping allowance.  So, as a consequence, we 
21   have a suggestion for you.  And the suggestion is 
22   relatively simple.  We believe it cannot have been 
23   contemplated by our friends at United nor the 
24   unions that they would actually expect you, as a 
25   court on a record like this under the time frames 
0011
 1   that are being presented to you, actually approve a 
 2   claim of that magnitude as a final determination.
 3                And so as a consequence, we suggest to 
 4   you, your Honor, that the restructuring agreements 
 5   should be approved, but they should be approved 
 6   with the understanding that the claim and the 
 7   consideration that is contemplated by them is 
 8   subject to the claim allowance process in the 
 9   Bankruptcy Code. 
10                As you recall, under Section 502, we 
11   expect that the unions collectively will file  
12   claims.  And it may be this amount or it may be 
13   another amount, I don't really know.  Those claims 
14   are allowed and they are allowed from the time of 
15   filing. 
16                We simply suggest to you that a party 
17   in interest, which might include the indentured 
18   trustees, it might include other creditors, should 
19   have the opportunity to object to those claims, if 
20   appropriate.  I can stand before you today and I 
21   can't tell you that an objection is appropriate. 
22   And that, in effect, is the gravamen of our 
23   concern, that somehow this Court's approval -- 
24   which can and should follow in this hearing -- will 
25   be considered a final adjudication of these 
0012
 1   amounts.
 2            THE COURT:  Okay.
 3            MR. SMITH:  If the amounts are prefatory, 
 4   if the bankruptcy process rolls forward, we have no 
 5   quarrel with this; in fact, we urge you to adopt 
 6   it, and we suggest to you that sophisticated 
 7   counsel working under tight time frames must not 
 8   have contemplated that you actually allow claims of 
 9   this magnitude as a final determination.  Indeed, I 
10   presume they have, as I have, read Telesphere, have 
11   read American Reserve and read the other cases that 
12   deal with this type of thing and understand how the 
13   bankruptcy works.  But as a bindery arrangement 
14   between the company on the one hand and the unions 
15   on the other, this is fixed.  And as an arrangement 
16   in the claims adjudication process --
17            THE COURT:  Your point is very simple, as 
18   I understand it.  It is that the debtor and the 
19   unions may agree that the unions will file a claim 
20   in a particular amount as to which the debtor will 
21   make no objection.
22            MR. SMITH:  That's correct.
23            THE COURT:  But that they cannot agree 
24   that no other party will make an objection.
25            MR. SMITH:  That's correct, your Honor.  
0013
 1   And they cannot, therefore, bind you in terms of a 
 2   adjudication, nor should they bind other parties in 
 3   interest, although it may be, in candor, those are 
 4   the right amounts.  We simply can't determine that 
 5   today.
 6            THE COURT:  Is there any other objection 
 7   that you wanted to make?
 8            MR. SMITH:  No, your Honor.
 9            THE COURT:  I thought at the beginning you 
10   said there were a couple of minor objections.
11            MR. SMITH:  Well --
12            THE COURT:  I think there's only one.
13            MR. SMITH:  I won't task you, there is 
14   only one.  We are concerned, as fiduciaries, that 
15   these agreements which are so important to United, 
16   so important to the unions and, in candor, so 
17   important to our constituency, should not pass 
18   without at least some observation that the 
19   bankruptcy process will be permitted to deal --
20            THE COURT:  Fine.
21            MR. SMITH:  And with that, your Honor, 
22   thank you.  And I also apologize for delaying you 
23   and appreciate your coming --
24            THE COURT:  Oh, no, there is no need for 
25   apology. 
0014
 1                Mr. Dimitrief, if you would respond to 
 2   this objection.  Or, Mr. Sprayregen, if you would 
 3   like to.
 4            MR. SPRAYREGEN:  Your Honor, I think the 
 5   simplest way to respond to the objection would be 
 6   to present to you what we would propose to be the 
 7   order granting this motion where we were obviously 
 8   aware of this objection and we have attempted to 
 9   deal with it in the way that the proposed order is 
10   drafted.
11                If I might approach.
12            THE COURT:  Sure.
13                        (Document tendered.)
14            MR. SMITH:  Jamie, have you got another 
15   one?
16                        (Document tendered.)
17            MR. SPRAYREGEN:  Just for the parties' 
18   benefit -- at least the ones that we spent the last 
19   10 hours with -- it's the most recent order that I 
20   will show to Mr. Smith here. 
21                The paragraph 4, I would direct you to 
22   in particular, the end of it. 
23            MR. SMITH:  What have we got?  Here, just 
24   give me half a second.
25                             (Document tendered.)
0015
 1            MR. SMITH:  Thanks.
 2                             (Lengthy pause.)
 3            THE COURT:  All right.  I read this order 
 4   at pages 2 and 3 to acknowledge that other parties, 
 5   which would include Mr. Smith's clients, state that 
 6   the claims set forth in the agreements may be 
 7   challenged at a later date and the debtors and the 
 8   unions state that the restructuring agreements 
 9   speak for themselves in that regard.  That appears 
10   to be an effort to avoid that issue being resolved 
11   at the present time. 
12                If Mr. Smith is comfortable with that 
13   solution, we can move on to other matters.  If he's 
14   not comfortable with it, then we'll have to address 
15   the matter further.
16            MR. SMITH:  Your Honor, it will shock you 
17   not at all to know that we've spent I don't know 
18   how much in terms of legal fees reading those two 
19   sentences.  It will shock you not at all that the 
20   indentured trustees find themselves in a peculiar 
21   situation where we're going to be criticized 
22   regardless of what we do, so our observation is if 
23   it is the Court's understanding that you're not 
24   adjudicating the claim so that Section 502 is still 
25   alive with respect to these claims, then we are 
0016
 1   satisfied.
 2                If, however, it is your view that -- 
 3   and it certainly is the view of I believe United 
 4   and the unions that the order constitutes an 
 5   adjudication and we have the right later on to 
 6   quarrel with the math, then we're dissatisfied. 
 7                And the reason is simply because given 
 8   the speed that has been imposed on the parties here 
 9   -- which, in all candor, is the result of external 
10   forces, and I don't blame them.  But we're all 
11   running hard trying to keep up.  And if we come 
12   into a plan negotiation at some point in the future 
13   -- and we think these are matters quintessentially 
14   to be left to a plan -- the public debt, if you 
15   will, would like the opportunity to say, "You know, 
16   we've looked at the Exhibit J formula, or Exhibit F 
17   formula, or whatever it is, and Judge Wedoff 
18   approved these agreements and United has agreed 
19   with these agreements and you agreed with these 
20   agreements, but we have some questions on the 
21   calculation."
22            THE COURT:  Let me just make an 
23   observation. 
24                I don't know, and can't possibly have 
25   given sufficient consideration to know, the 
0017
 1   appropriateness of a claim to be asserted by the 
 2   unions in connection with these restructurings.  I 
 3   have every reason to believe that it was the 
 4   subject of considerable negotiation between United 
 5   and the unions.  If there's also no question that 
 6   the agreement of the unions to accept reductions in 
 7   the compensation of their members as this case 
 8   moves forward would be essential to the continued 
 9   operation of the airline, it's continued ability to 
10   generate income and, hence, the potential for your 
11   clients recovering anything on their general 
12   unsecured claims -- with those observations, I 
13   would suggest that it is highly likely that the 
14   claims that are set forth in this agreement would 
15   ultimately be approved by the Court if there were a 
16   challenge made to the claims. 
17                However, I have to believe that the 
18   provisions of Section 502 of the Bankruptcy Code 
19   which would allow other parties to challenge claims 
20   asserted by any creditors of the estate, could not 
21   be undone by a bilateral agreement between the 
22   debtor and a particular creditor. 
23                So those -- those would be my 
24   observations.  If that's troubling to either party 
25   in such a way as to cause them not to want me to 
0018
 1   sign this order, I will hear from them.  But that's 
 2   the way I would view the situation at the present 
 3   time.
 4            MR. SMITH:  Your Honor, with that 
 5   clarification, subject to being told what I think, 
 6   since I'm not entirely sure what I think at any  
 7   given time, I believe that I would stand content.
 8                Am I wrong?  
 9               Your Honor, with that clarification, we 
10   couldn't be happier, and we urge you, for the good 
11   of all of us, to approve these agreements and grant 
12   the motion.
13            MR. SPRAYREGEN:  If I might take a moment.
14            MR. JACOBSON:  Good afternoon, your Honor.  
15   Fruman Jacobson on behalf of the Creditors 
16   Committee.  We, too, have struggled long and hard 
17   and we do support the debtors' and the unions' 
18   attempts to find peace, and a very productive 
19   peace, and a future for this airline. 
20                And on the assumption and 
21   understanding that was just expressed by Mr. Smith, 
22   based upon your Honor's comments, we support the 
23   entry of the order granting the motion.
24            THE COURT:  Thank you, Mr. Jacobson.
25            MR. SIMON:  Your Honor, Bruce Simon for 
0019
 1   the Airline Pilots Association. 
 2                Mr. Smith remarked that the 
 3   concessions made by the unions was significant.  
 4   But he stated that the claim represented by that is 
 5   heart stopping.  Let me suggest to you that if 
 6   anything is heart stopping, it's that the unions 
 7   collectively have agreed to over $16 billion of 
 8   concessions.  That is not merely unprecedented in 
 9   United or in the airline industry, but I 
10   respectfully suggest to you anywhere in any 
11   industry in the United States.  That's what is 
12   heart stopping about this case.
13                With the Court's observations, and 
14   with Mr. Smith's observations, if there is nothing 
15   in the Court's approval of this order that creates 
16   any rights for the creditors which Section 502 in 
17   its fullness would otherwise give them in the face 
18   of a court approved order in that form, with the 
19   agreement between the parties speaking for itself, 
20   with the court order speaking for itself, whatever 
21   rights the creditors might have at that point, they 
22   have; whatever rights they do not have, they do not 
23   have.  With that we have no problem.
24                With anything that casts a shadow on 
25   the restructuring agreement that was reached 
0020
 1   tortuously between these parties or that casts a 
 2   shadow on the order that has been submitted for 
 3   your Honor's approval and signature today, if there 
 4   is that shadow, then we do have a significant 
 5   problem with it.
 6                Because, as the Court indicated, the 
 7   one thing that the employees got in response for 
 8   their $16 billion of the heart-stopping concessions 
 9   is a provision at the end of the case for a 
10   profit-sharing program that may or may not ever 
11   yield anything and for a formula that would define 
12   in the plan of reorganization terms proposed by the 
13   company a manner of calculating the worth of that 
14   claim going forward.
15            THE COURT:  Okay.  Mr. Simon, I only 
16   observed that your remarks just now I believe are 
17   completely consistent with what I should said.
18            MR. SIMON:  Thank you, your Honor.
19            MR. BARLIANT:  Ronald Barliant on behalf 
20   of U.S. Bank, in its capacity as indentured 
21   trustee, for aircraft of United Airlines. 
22                I join in the congratulations to the 
23   parties for reaching this agreement.  And I think 
24   -- especially in light of what was just said -- 
25   that I do not have a problem. 
0021
 1                But I must tell the Court that I was 
 2   not involved in these negotiations, I don't sit on 
 3   the committee, and I first learned about this 
 4   roughly three-and-a-half hours ago and pulled down 
 5   the papers from the web site and talked with my 
 6   co-counsel in Boston a little bit after that.  So 
 7   that whatever I say has to be on that basis and 
 8   it's quite possible we'll be back here once we have 
 9   a chance to digest all of this on some other terms.
10                But having heard what I've heard, I 
11   just want to point out to the Court one other 
12   matter.  And I think what the Court has said may 
13   address the problem that I'm about to point out, if 
14   it is a problem.  The order that's been tendered 
15   provides in paragraph 3 that the Court, pursuant to 
16   Section 363 -- this is at page 2 -- approves -- 
17   essentially says that the Court is approving the 
18   restructuring agreements and authorizes the debtors 
19   to perform under those restructuring agreements.
20                And, again, I haven't -- I barely 
21   looked at the attachments that were on the web 
22   site.  I certainly haven't read the agreements. But 
23   paragraph 7 of the motion which I also just saw 
24   maybe a couple of hours ago -- not paragraph 7,  
25   excuse me, page 7 of the motion says, about a third 
0022
 1   of the way down, beginning with the words "and 
 2   third" -- "and, third, the restructuring agreements 
 3   ..."
 4                Page 7.  I may not even have the right 
 5   motion.
 6                I'm sorry, I meant page 7.  Okay.
 7                "The restructuring agreements provide 
 8   that any plan of reorganization proposed or 
 9   supported by the debtors shall provide that upon 
10   the effective date of such a plan the unions will 
11   receive a percentage distribution of the equity, 
12   securities, and other consideration provided to 
13   general unsecured creditors under the plan as 
14   calculated by a formula agreed to in the 
15   restructuring agreement."  It then goes on to say 
16   that only if that doesn't happen do the unions get 
17   the claim.
18                I think all I'm suggesting is that 
19   what the Court said about essentially our rights 
20   under Section 502 being preserved that needs to be 
21   expanded or be construed to be expanded to include 
22   our rights under Section 1129 in Chapter 11. 
23                So, otherwise, this -- this language, 
24   which apparently as I understand it, is a part of a 
25   restructuring agreement would be approved by the 
0023
 1   Court, and the debtors would be required to propose 
 2   that plan.  If the Court is saying that the parties 
 3   are free to object to such a plan, that is quite 
 4   something else.
 5            THE COURT:  It's quite clear to me there 
 6   would be nothing in the order that I enter today 
 7   that would preclude the right of any party or limit 
 8   the right of any party to object to anybody's plan 
 9   of reorganization that's filed in this case.  
10   That's just not part of what is before the Court.
11            MR. BARLIANT:  It's also a problem -- 
12   since this is a Section 363 order, it would be a 
13   problem under the Braniff Airline decision.  But I 
14   take it, as the Court is indicating, that this is 
15   subject to a later determination.
16            THE COURT:  I don't think there could 
17   reasonably be construed to be any limitation on 
18   parties' rights to object to plans of confirmation, 
19   apart from the debtors.  If the debtor wants to 
20   limit itself to the kind of plan that it's going to 
21   propose, it's certainly free to do that.
22            MR. BARLIANT:  Understood.  Thank you, 
23   your Honor.
24                Again, I can't quite say that I 
25   endorse this because of the short notice and the 
0024
 1   time I need to talk to other people, but I do 
 2   appreciate what the debtors and the unions have 
 3   done. 
 4                Thank you.
 5            THE COURT:  Anyone else?
 6            MR. KAPLAN:  Yes, your Honor.  Harold 
 7   Kaplan, with Mark Hebbein, Gardner & Carton.  We 
 8   represent HSBC.  We represent a billion dollars of 
 9   the public debt.
10                I think, your Honor, the issues were 
11   phrased and the same issue -- Mr. Smith defined the 
12   issues and we're happy with the statements that 
13   were made here and how the situation resolves to 
14   the extent there is any issue about us raising 
15   those issues.  We are fine with the resolution as 
16   it is, and we support the entry with those 
17   understandings.
18            THE COURT:  Fine.  Thank you, Mr. Kaplan.
19                Is there anyone else who wishes to 
20   address the Court?
21                   (No response.)
22            THE COURT:  If not, then let me simply 
23   advert to the remarks that I made when this case 
24   first came before the Court, and that is that the 
25   power of the Court in a situation like this is 
0025
 1   really very limited.  In the context of Section 
 2   1113 of the Bankruptcy Code, for example, the only 
 3   power the Court has is to either grant or deny a 
 4   motion by the debtor to reject a collective 
 5   bargaining agreement.  It's an all or nothing 
 6   proposition.  The parties themselves have the 
 7   opportunity to create solutions of considerably 
 8   more subtlety and appropriateness for the case.  
 9   And what has happened here is that the parties have 
10   done so. 
11                I certainly appreciate the effort that 
12   went into this.  And thanking me is really a 
13   superfluity.  The amount of work that I've had to 
14   do here, thanks to the work that you all have done, 
15   is virtually nill.  But I am confident that all of 
16   the parties who are affected by the operations of 
17   United Airlines are very grateful for the time, 
18   effort, and sacrifice that has gone into this 
19   process. 
20                So it is with a great deal of relief 
21   and gratefulness that I will sign the order that 
22   has been presented to me.
23            MR. SPRAYREGEN:  Thank you, your Honor. 
24   That's all we have for today, your Honor.  Thank 
25   you.
0026
 1            MR. DIMITRIEF:  Thank you, your Honor.
                     (Which were all the proceedings had
 2                    in the above-entitled cause, 
                     April 30th, 2003.)
 3   
 4   I, CAROL RABER, C.S.R., DO HEREBY CERTIFY
     THE FOREGOING IS A TRUE AND ACCURATE 
 5   TRANSCRIPT OF PROCEEDINGS HAD IN THE
     ABOVE-ENTITLED CAUSE.
 6   

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