Pension Benefit Guaranty Corporation (PBGC) filed with the U.S. Bankruptcy Court an objection to Cenveo’s Disclosure Statement.
PBGC asserts, “The Disclosure Statement fails to provide ‘adequate information’ as defined under the Bankruptcy Code, because it does not provide creditors with critical information about (1) the status of the Pension Plans and the statutory procedures required for any contemplated termination of the Pension Plans; and (2) PBGC’s contingent claims of over $179 million – the largest unsecured claims in this case. First, the Disclosure Statement does not adequately inform creditors about the disposition of the Pension Plans and the impact of any contemplated termination of the Pension Plans on the effectiveness of the Debtors’ Plan of Reorganization (ECF No. 254, the ‘POR’).”
In addition, “PBGC has grave concerns that Cenveo seeks a decision by this Court on termination of the Pension Plans without: (i) properly moving this Court for such relief; (ii) providing PBGC with the information it needs to evaluate such a motion; and (iii) creating a record that will enable this Court to make informed findings of fact, as required by statute. The Debtors cannot simply terminate the Pension Plans by including provisions in a proposed confirmation order; PBGC is entitled to seek discovery and conduct an evidentiary hearing to enable the Court to determine whether the test is met. Since termination of the Pension Plans is a condition precedent to effectiveness of the proposed POR, creditors need information about the statutory process for terminating the Pension Plans and the impact of termination proceedings on the effectiveness of the POR.”
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