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FIBREBOARD AND CONTINENTAL CASUALTY

 CONCORD, Calif., April 12 /PRNewswire/ -- Fibreboard Corp. (AMEX: FBD) announced today it has signed an agreement with its insurer, Continental Casualty Co., whereby the companies will jointly use best efforts to negotiate and implement a global settlement of all pending and future asbestos-related personal injury claims against Fibreboard within the company's available insurance resources. If such a settlement can be achieved, the agreement provides that the pending personal injury insurance coverage litigation between Fibreboard and Continental will be dismissed.
 In the event no global setlement of Fibreboard's asbestos-related personal injury litigation can be achieved, Continental will continue the appeal of the 1990 trial court judgment which found Fibreboard has virtually unlimited insurance coverage for personal injury claims alleging first exposure to asbestos in or prior to March 1959 ("before 1959 claims"). That appeal is currently before the California Court of Appeal with a decision not expected until late 1993 at the earliest. Under the terms of the Fibreboard-Continental agreement, if Fibreboard ultimately prevails in that appeal, Continental will provide Fibreboard with $315 million to $425 million to resolve personal injury claims alleging first exposure to asbestos after March 1959, less any amount Fibreboard recovers from a 1992 settlement agreement with Pacific Indemnity Insurance Co. Continental would also continue to have responsibility for all "before 1959" personal injury claims against Fibreboard up to $500,000 per individual claim.
 Additionally, the Fibreboard-Continental agreement requires Continental to provide a full defense to Fibreboard on "before 1959" claims through the ultimate conclusion of the insurance coverage appeal, however long that may take. The agreement also requires Continental to pay up to $20 million in currently due "before 1959" settlement obligations to asbestos personal injury claimants and to advance Fibreboard up to $95 million as needed to pay for other personal injury defense costs for which Fibreboard does not have insurance available.
 In exchange for the benefits provided under the agreement and subject to existing contractual obligations to personal injury claimants with whom Fibreboard has previously settled, Fibreboard agrees not to settle additional "before 1959" claims without Continental's consent. The agreement also resolves pending asbestos in buildings insurance coverage litigation between Fibreboard and Continental.
 This Fibreboard-Continental agreement follows the Feb. 8, 1993, announcement by Continental that it was increasing its reserve on account of asbestos-related claims by $1.5 billion and intended to engage in settlement discussions with Fibreboard.
 Fibreboard Chairman John D. Roach stated, "We are quite pleased we were able to conclude this agreement with Continental. It is another step forward in our effort to achieve a satisfactory resolution to our asbestos problem. The agreement clears the way for Continental, Fibreboard and representatives of the personal injury claimants to begin immediate negotiations to accomplish a global settlement. Even if a global settlement cannot be implemented, the agreement provides Fibreboard with significant additional interim protection while we continue the insurance coverage appeal and, if Fibreboard ultimately wins that appeal, a substantial sum to deal with those claims not covered under the Continental insurance policies. However, we continue to remind investors that if Fibreboard were to lose the insurance coverage appeal with Continental, we would likely seek the protection of a Chapter 11 bankruptcy proceeding, since our asbestos-related liabilities would significantly exceed available corporate assets."
 Fibreboard Corp., headquartered in Concord, manufactures lumber, hardwood, plywood, moulding and millwork, agricultural container components, precision molded industrial insulation and fire-proofing materials. It also owns and operates Northstar-at-Tahoe, a ski resort and year-round vacation and conference center in California.
 -0- 4/12/93 R
 /CONTACT: Stephen L. DeMaria of Fibreboard, 510-686-0700/
 (FBD)


CO: Fibreboard Corp. ST: California IN: PAP SU: JL-LS -- LA008R -- 4960 04/12/93 18:10 EDT
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Publication:PR Newswire
Date:Apr 12, 1993
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