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Sources: United may file Chapter 11 on Sunday

United Airlines is expected to file bankruptcy.

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CHICAGO, Illinois (CNN) -- The International Association of Machinists has warned its members at United Airlines that a bankruptcy filing "appears unavoidable and imminent."

In a letter sent to members Saturday, the union's chapter at the airline called on all United employees to "stand shoulder to shoulder at this most critical time in our company's history."

"We must all work to ensure United Airlines avoids liquidation and successfully emerges from bankruptcy a healthier and stronger company," the letter said.

United's board of directors met Saturday and adjourned without making any statement on a possible bankruptcy filing. Another board meeting was scheduled for Sunday.

Sources close to the discussions told CNN that United's bankruptcy petition is likely to be filed Sunday evening, after attorneys complete paperwork to put financing in place to keep the carrier flying while it reorganizes.

On Wednesday, the Air Transportation Stabilization Board turned down United's request for $1.8 billion in federal loan guarantees under a program set up by Congress after the September 11, 2001, terrorist attacks.

The company had wrung more than $5 billion on labor concessions from its unions, but the ATSB decided the recovery plan was still insufficient to ensure that the loans would be repaid.

In the wake of the ATSB rejection, United's stock plunged to just 93 cents a share, amid investor fears that bankruptcy appeared certain.

United has obtained $1.5 billion in special financing from its banks that should allow the carrier to keep flying while it reorganizes its finances. While travelers should not see any disruptions in the short term, significant layoffs are expected as United tries to slash its costs.

The company has 83,000 employees, who collectively own about 55 percent of the company's stock under an employee ownership plan.

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