Pacific Lumber asks for approval to make scheduled pension plan payments

By Reshmi Basu

New York, Aug, 16 - Pacific Lumber Co. requested court approval to make its scheduled contribution to the company's pension plan, according to a Thursday filing with the U.S. Bankruptcy Court for the Southern District of Texas.

The next payment of $552,910 is due on Sept. 14.

Although the pension plan has been frozen since Dec. 31, 2005, the company continues to have funding requirements.

According to the motion, if the court denies the company's request, "it could result in a serious blow to employee relations, and damage Palco's ability to reorganize."

Furthermore, the debtor's failure to make the payment could trigger an accumulated funding deficiency under ERISA, which would constitute an event of default under the debtor-in-possession financing agreement, Pacific Lumber said in the motion.

A hearing is scheduled for Sept. 11. If there are no objections filed by Sept. 7, the hearing will be canceled.

Pacific Lumber, a Scotia, Calif.-based producer of redwood lumber and an indirect wholly owned subsidiary of Maxxam Inc., filed for bankruptcy on Jan. 18, 2007 in the U.S. Bankruptcy Court for the Southern District of Texas. Its Chapter 11 case number is 07-20027.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.