Werner creditors committee seeks court OK of agreement with PBGC to resolve pension claims dispute

By Reshmi Basu

New York, Oct. 9 - Werner Holding Co. (DE)'s official committee of unsecured creditors asked for court approval of a stipulation agreement with the Pension Benefit Guaranty Corp., or PBGC, that would resolve a dispute over three claims filed against the company relating to its pension plan, according to a Tuesday filing with the U.S. Bankruptcy Court for the District of Delaware.

According to the motion, PBGC filed a $27.2 million claim for unfunded benefit liabilities under Werner's retirement plan, a $5.27 million claim for unpaid minimum funding contributions due to the pension plan and an unliquidated claim for unpaid premiums relating to insurance, interest and penalties.

In the motion, Werner said the parties entered into negotiations to end the conflict over the proper priority classification of the claims.

Under the proposed stipulation agreement:

• The unfunded liability claim will be allowed in the amount of a $28 million unsecured, non-priority class 4 claim against Werner;

• The minimum funding claim will be allowed in the amount of a $7.58 million unsecured, non-priority class 4 claim; and

• The insurance premium claim will be withdrawn.

"The stipulation fairly represents the debtors' liability to the PBGC, avoids the expense, delay and uncertainty surrounding any litigation over the amount and priority of PBGC claims, and finally, increases the likelihood that the committee will be able to confirm the plan," the creditors committee argued in the motion.

A hearing is scheduled for Oct. 25.

Werner, a Greenville, Pa., manufacturer and distributor of ladders, climbing equipment and ladder accessories, filed for bankruptcy on June 12, 2006. Its Chapter 11 case number is 06-10578.

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