London Fog requests court OK for $3.3 million settlement with PBGC

By Jennifer Lanning Drey

Portland, Ore., Nov. 26 - London Fog Group, Inc. requested court approval of a settlement agreement with Pension Benefit Guaranty Corp. under which PBGC has agreed to support the company's plan of reorganization, according to a Monday filing with the U.S. Bankruptcy Court for the District of Nevada.

Under the agreement, PBGC will be allowed a $3.3 million general unsecured claim against London Fog in place of five previously filed claims against the company that totaled more than $8.2 million.

On the effective date of London Fog's plan of reorganization, the company and PBGC will execute an agreement terminating the pension plan to which the claims were related. Both parties will mutually release all claims against each other on the same date.

PBGC had previously filed three unsecured claims totaling $7.96 million and two administrative claims for a total of $225,115 against London Fog.

London Fog said in the settlement motion that it disagreed with PBGC's calculation and characterization of claims but had not yet filed a formal document objecting to the claims.

The two parties have been negotiating the claims for more than one year, according to the motion.

London Fog, a Seattle-based apparel company, filed for bankruptcy on March 20, 2006 in the U.S. Bankruptcy Court for the District of Nevada. Its Chapter 11 case number is 06-50146.

© 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.