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EASTERN AIR LINES' RETIREES TO RECEIVE $25 MILLION FOR HEALTH BENEFITS

 MIAMI, July 1 /PRNewswire/ -- Chief Bankruptcy Judge Burton R. Lifland has approved an agreement between Martin R. Shugrue Jr., trustee for Eastern Air Lines, and Bill Bell, chairman of the Official Committee of Retired Eastern Employees, that will provide additional funds for health care benefits for retired Eastern employees under the age of 65. The agreement provides approximately $15 million immediately and another $10 million over the next two years. The additional $10 million is contingent upon Eastern recovering certain designated funds.
 Bell stated the negotiations were very difficult for all concerned because they involve health care for thousands of people, not just dollars. John DeRose, chairman of the retiree medical trust (VEBA) that is administering the health care benefit plan, said that $25 million should provide benefits through December 1994. Including the $25 million expected contribution, the Eastern Estate will have contributed in excess of $55 million to the retiree medical trust (VEBA). Martin R. Shugrue Jr. stated, "I am most pleased that the Estate is able to provide additional funding to the retiree medical trust so that eligible retirees may continue to maintain health care coverage at an affordable price." Shugrue also praised Judge Lifland's compassion and thoughtfulness in approving the deal.
 A tri-party agreement between the retired employees, Eastern and Travelers Insurance Company was also announced. This agreement will provide the retirees with limited conversion rights for life insurance regardless of their current health, and death benefits for beneficiaries of those retirees who died after July 1, 1991 as outlined in a recent mailing. Bell said the benefits are limited and vary according to the laws of individual states. Travelers liability is limited to $850,000 for death benefits. Since current addresses are not available for all beneficiaries of the insurance policies, retirees are urged to spread the word regarding this settlement to families of retirees that have died.
 Both Shugrue and Bell emphasized that this is the end as far as money for health care and life insurance is concerned and Bell stated that his committee would be dissolved after the life insurance and health care agreements are approved by the court.
 -0- 7/1/93
 /CONTACT: John J. Sicilian of Eastern Air Lines, 305-873-3455/


CO: Eastern Air Lines ST: Florida IN: AIR SU:

AW-JB -- FL010 -- 7730 07/01/93 12:24 EDT
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Publication:PR Newswire
Date:Jul 1, 1993
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