By Dave Carpenter
The Associated Press

United Airlines ticket agents talk Wednesday at Chicago's O'Hare International Airport. Parent company UAL, refused a federal loan guarantee and its stock price plunging, is expected to file for bankruptcy. (Associated Press photo) | ZOOM |

CHICAGO - United Airlines scrambled to chart a course through its financial emergency Thursday as its stock went into a free-fall on expectations of a bankruptcy filing, an action its CEO insisted is not a foregone conclusion.

But sources familiar with the process, who spoke on condition of anonymity, said United was preparing to file for bankruptcy Sunday. The carrier was completing terms of a $1.5 billion debtor-in-possession loan to keep the airline flying in bankruptcy, the sources said.

Shares in parent UAL Corp. lost two-thirds of their value in response to the Air Transportation Stabilization Board's decision late Wednesday not to provide a $1.8 billion loan guarantee.

Trading in the stock was halted for the session's first four hours Thursday while the New York Stock Exchange reviewed UAL's qualifications to continue being listed. In heavy afternoon trading, shares plunged $2.12, or 68 percent, to $1 - the lowest level in decades. If United files Chapter 11, its shares would become almost worthless.

Standard & Poor's further downgraded United's credit ratings after the "disappearance of any realistic possibility" of paying off deferred debt and avoiding bankruptcy.

United, which has about $1 billion in cash, has $920 million in overdue debt obligations.

Chief executive Glenn Tilton, after a meeting with leaders of the pilots' union, which holds the largest single stake in the airline, said a bankruptcy filing is not inevitable.

"What we have said is we're going to consider all of our options and nothing really is a foregone conclusion," he told Chicago's WLS-TV.