Walter Energy filed with the U.S. Bankruptcy Court a motion for the entry of an order authorizing and directing the trustee of Walter Industries deferred compensation plan trust to terminate the trust and release the trusts assets to Walter Industries.
The motion explains, Because assets of a rabbi trust, by definition, belong to the grantor and revert to the grantor upon bankruptcy or insolvency, the Participants do not have a preferred claim to the Trust Assets. Here, the Trust Agreement expressly provides that: (1) the Participants have no preferred claim to, or any beneficial interest in, the Trust Assets, (2) the Participants status does not exceed that of the Companys un…
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