Motion Filed by Certain SIP Claimants to Terminate Comdisco's Litigation Trust.ROSEMONT, Ill. -- Comdisco Holding Company, Inc. announced that, on March 16, 2006, a motion was filed in the United States Bankruptcy Court bankruptcy court n. the specialized Federal court in which bankruptcy matters under the Federal Bankruptcy Act are conducted. There are several bankruptcy courts in each state, and each one's territory covers several counties. for the Northern District of Illinois, Eastern Division on behalf of certain participants in Comdisco, Inc.'s Shared Investment Plan (the "SIP") who have not previously settled their obligations under the SIP, which dates back to January 1998. The motion seeks to terminate the litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. trust established under Comdisco's plan of reorganization, which became effective on August 12, 2002. The litigation trust was formed to pursue subrogation The substitution of one person in the place of another with reference to a lawful claim, demand, or right, so that he or she who is substituted succeeds to the rights of the other in relation to the debt or claim, and its rights, remedies, or Securities. claims from SIP participants that have not previously agreed to a compromise and settlement with respect to their obligations under the SIP. On March 23, 2006, at a Bankruptcy Court hearing, Comdisco argued that the motion had not been properly noticed to all of the parties with an interest in the motion. Holders of contingent distribution rights ("CDRs") (OTCBB OTCBB See OTC Bulletin Board (OTCBB). :CDCOR) and holders of common stock (OTCBB:CDCO CDCO Curriculum Design, Content and Organization CDCO Classified Document Control Office ), in each case issued by Comdisco pursuant to its plan of reorganization, together with the Class C-4 creditors under the plan of reorganization are potentially impacted by a termination of the litigation trust. However, the Bankruptcy Court ruled that, based on information before it, the notice was adequate and set a hearing on the merits on the merits adj. referring to a judgment, decision or ruling of a court based upon the facts presented in evidence and the law applied to that evidence. A judge decides a case "on the merits" when he/she bases the decision on the fundamental issues and considers of the motion for May 24, 2006. Termination of the litigation trust would eliminate a source of recovery for the Class C-4 creditors contemplated by the plan of reorganization if the subrogation claims are extinguished as a result of such termination. Under the plan of reorganization, the amount of distributions to Class C-4 creditors from the litigation trust has a further impact on holders of CDRs and common stock. For a more complete discussion of the relative impact on these different constituencies of distributions from the litigation trust, please refer to Comdisco's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended September 30, 2005, as filed with the Securities and Exchange Commission. The Annual Report is also available on Comdisco's website at www.comdisco.com. Comdisco intends to oppose the motion on the basis that it is inconsistent with the plan of reorganization approved by its constituents through the bankruptcy process. About Comdisco Comdisco emerged from chapter 11 bankruptcy proceedings bankruptcy proceedings n. the bankruptcy procedure is: a) filing a petition (voluntary or involuntary) to declare a debtor person or business bankrupt, or, under Chapter 11 or 13, to allow reorganization or refinancing under a plan to meet the debts of the party on August 12, 2002. The purpose of reorganized Comdisco is to sell, collect or otherwise reduce to money in an orderly manner the remaining assets of the corporation. Pursuant to Comdisco's plan of reorganization and restrictions contained in its certificate of incorporation certificate of incorporation n. some states issue a certificate to prove a corporation's existence upon the filing of Articles of Incorporation. In most states the Articles are sufficient proof. , Comdisco is specifically prohibited from engaging in any business activities inconsistent with its limited business purpose. Accordingly, within the next few years, it is anticipated that Comdisco will have reduced all of its assets to cash and made distributions of all available cash to holders of its common stock and contingent distribution rights in the manner and priorities set forth in the Plan. At that point, the company will cease operations and no further distributions will be made. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. The foregoing contains forward-looking statements regarding Comdisco. They reflect the company's current views with respect to current events and financial performance, are subject to many risks, uncertainties and factors relating to the company's operations and business environment which may cause the actual results of the company to be materially different from any future results, express or implied by such forward-looking statements. The company intends that such forward-looking statements be subject to the Safe Harbor created by Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The words and phrases Words and Phrases® A multivolume set of law books published by West Group containing thousands of judicial definitions of words and phrases, arranged alphabetically, from 1658 to the present. "expect," "estimate," and "anticipate" and similar expressions identify forward-looking statements. Certain factors that could cause actual results to differ materially from these forward-looking statements are listed from time to time in the company's SEC reports, including, but not limited to, the company's most recently filed periodic reports. Comdisco disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. |
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