=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2002/12/18/f= inancial0351EST0028.DTL ---------------------------------------------------------------------- Wednesday, December 18, 2002 (AP) United warns of contract overhaul if no wage-cut deal soon MIKE ROBINSON, Associated Press Writer (12-18) 00:51 PST CHICAGO (AP) -- United Airlines' labor unions want more details about the company's business plan as they struggle with the carrier over deep wage cuts United is seeking within the next week. Bankrupt United warned Tuesday that it will ask a U.S. Bankruptcy Court next Thursday to begin the process of voiding labor contracts if the unions don't agree to the wage cuts by then. United, which is seeking $2.4 billion in annual labor cuts, said it must have cost cuts in place by Feb. 15 to meet the conditions of its $1.5 billion in bankruptcy financing from a group of banks. Pilots' union leader Paul Whiteford said the company must provide more information about its post-bankruptcy plans if it expects workers to approve the cuts. "The company talks about a commitment to forging consensual agreements," said Whiteford, president of the United unit of the Air Line Pilots Association. "We hope they mean what they say, but so far the process they have employed gives us pause and concern. ALPA continues to ask for and has yet to receive critical information, most importantly a specific business plan, that maps out the future size, scope, and shape of the company post-bankruptcy." United said it will continue negotiating toward "consensual agreements" = on the labor concessions until would file the motion. The move steps up the pressure on United's unions, which were stunned by the size and scope of the cuts management outlined last week. Machinists' union leaders Scotty Ford and Randy Canale told members the motion was expected. US Airways had filed the same request in bankruptcy court in August before negotiating new labor agreements. Separately Tuesday, a judge refused an emergency request from the trustee for the United Airlines employee stock ownership plan for permission to sell off up to $40 million of the troubled company's stock. Eugene Wedoff, chief judge of the U.S. Bankruptcy Court, said the facts = of the issue were too complex to make an immediate decision. A ban on the stock sale by the ESOP will remain in place at least until Dec. 30, when an omnibus hearing is scheduled. The employee stock ownership plan, created in 1994 and now with 75,000 members, held about 55 percent of the company's shares until September when its trustee, State Street Bank & Trust Co., began selling off 24.1 million shares. State Street was barred by court order from selling off any more shares after the airline declared bankruptcy on Dec. 9. United says sale of more shares could cause a change in control of the company that would cost it $1.4 billion in tax breaks from net operating losses. State Street says it has a duty to do whatever is in the best interests = of the employees who are part of the ESOP and that it now wants to sell 32.5 million additional shares. George M. Cheever, attorney for State Street, said the bank believes "it is vitally important that we be allowed to sell these shares." But Brian D. Sieve, an attorney for United, said there was no emergency and noted that the share price rose after the airline filed for bankruptcy. =20 ---------------------------------------------------------------------- Copyright 2002 AP