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Midway Reaches Deal With Pilots

October 10, 2003

RALEIGH, N.C. (AP) _ Midway Airlines employees returned to work Thursday after the bankrupt airline made a last-minute deal with its pilots’ union that saved it from liquidation.

The Morrisville-based carrier reached the agreement just minutes before the two sides were due in court, Midway’s attorney told bankruptcy Judge A. Thomas Small. As long as other parties approve the contract, the resolution sets in motion the factors necessary for Midway to file its reorganization plan and emerge from bankruptcy.

There were no objections to Midway’s request to continue the hearing rather than convert its case to Chapter 7 bankruptcy, which would require it to shut down and sell off its assets.

A successful agreement between Midway and the Air Line Pilots Association had seemed unlikely. A recorded message from the union to pilots on Wednesday night called the negotiations ``frustrating″ and a ``fiasco.″

As a result, the 35 employees at the airline’s Morrisville headquarters had packed up their desks in preparation for what seemed like the company’s inevitable death sentence.

Many of the two dozen employees who sat behind CEO Bob Ferguson in court Thursday sighed audibly as court adjourned. The beaming workers hugged each other as they filed out of the courtroom.

The agreement must still be approved by ALPA’s national office, US Airways and a potential investor. The investor, who has not been identified, is critical to Midway’s deal with US Airways, and therefore its reorganization plan.

Approval by the other parties isn’t a sure thing. Midway isn’t ``wildly optimistic″ that ALPA and US Airways will sign off on the agreements, lawyer Jeb Jeutter said.

A union spokesman also expressed reservations.

``I’m not aware of any red flags, but it all depends on what we’re ultimately going to see in writing,″ said ALPA spokesman John Perkinson. ``As we’ve seen at other properties, that can vary greatly (from the oral agreement).″

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