Pacific Lumber obtains court approval to make scheduled pension plan payments

By Reshmi Basu

New York, Sept. 7 - Pacific Lumber Co. obtained court approval to make its scheduled contribution to the company's pension plan, according to a Friday filing with the U.S. Bankruptcy Court for the Southern District of Texas.

The order allows the company to pay off its next payment of $552,910, which is due on Sept. 14.

There were no objections to the motion.

As previously reported, although the pension plan has been frozen since Dec. 31, 2005, the company continues to have funding requirements.

The company had said that its 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, 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.

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