Falcon Products Inc., St. Louis, asked the court overseeing its Chapter 11 bankruptcy reorganization to approve the termination of its three pension plans, according to court papers.
In a motion filed with U.S. Bankruptcy Court in St. Louis on Friday, Falcon Products said its proposed reorganization plan is conditioned "on the elimination of all or virtually all of (the company's) unsecured obligations, including the underfunding obligation to the pension plans." Falcon Products, which filed for bankruptcy protection in January, received court approval of the reorganization plan's disclosure statement Aug. 29; a confirmation hearing is slated for Oct. 6.
The three pension plans had a combined $28.6 million in assets as of Nov. 1, 2003, according to the company's latest annual report. The plans are underfunded by $33.8 million, according to court papers. Neal Restivo, the company's CFO, did not return a call by press time.
The company filed a separate motion Friday seeking court approval to "modify or reject" its collective bargaining agreement with the United Food and Commercial Workers International Local 272(T), Russellville, Tenn., which represents nearly one-third of Falcon's employees. The agreement expires Nov. 21. That motion said the company proposes establishing a 401(k) plan for the union workers in place of a terminated pension plan. Dallas Stepp, president of UFCW Local 272(T), did not return a call by press time.
The bankruptcy court scheduled a hearing on the pension issues for Sept. 23.
Jeffrey Speicher, a PBGC spokesman, said Falcon Products proposed terminating the plans retroactive to Aug. 31. He said agency officials have not determined how much in plan liabilities the PBGC would assume.
