Confessing in a statement released Friday that its board had determined that “Keller can no longer afford to maintain the Plan,” Keller offered the plan to the PBGC in a distress termination proceeding. The Keller statement said that its 85% stake in Paragon Door Designs also cannot support the plan’s liabilities.
Keller executives were frank in their admission that the future for the plan was extremely uncertain. “Keller is hopeful that it will be able to work with the PBGC to finally resolve all Plan liabilities pursuant to terms which are acceptable to the PBGC and affordable for Keller and its new subsidiary Paragon,” they said in the statement. “However, there can be no assurance that the PBGC will approve the termination of the Plan or that the PBGC will be willing to work with Keller and Paragon to resolve this liability in a manner which will allow them to continue to do business with Keller maintaining an ownership interest in Paragon. It is possible that the PBGC will require Keller or Paragon, or both, to liquidate their business and assets and contribute the proceeds toward the Plan liability.”
According to Keller, the plan has $3.95 million in liabilities but that the PBGC might come up with a “substantially higher” number when calculating liabilities using a “termination basis” method.
If the PBGC accepts the plan, 98% of participants should get the amount of benefits they would have received without the termination, Keller said.
Keller anticipates finalizing its 2005 audited financial statements and releasing them to shareholders during the second quarter along with a letter which will provide, if available, an update on the Plan termination.
According to a statement posted its Web site earlier this year, the Keller business is no longer active. “Keller no longer has any furniture inventory or replacement parts and we apologize for this inconvenience,” the company said in the statement. “The ‘Keller Furniture’ brand name, web site, furniture designs, and other marketing materials are for sale. If you have an interest in buying these assets please leave us a voice message or send us a letter. We apologize again for this inconvenience and thank you for your past support of Keller.”