Collins & Aikman to make $30,000 monthly payments under mold supply contract agreement

By Caroline Salls

Pittsburgh, May 25 - Collins & Aikman Corp. entered an agreement with Tri-Way Mfg., Inc. under which Collins & Aikman will make $30,000 per month in adequate protection payments for $1.19 million owed for the manufacturing and delivery of molds, according to a Thursday filing with the U.S. Bankruptcy Court for the Eastern District of Michigan.

The payments will continue until the earliest of the molds is no longer being held or used by the company; the confirmation of a Collins & Aikman plan of reorganization or upon occurrence of a termination notice.

Either party can terminate the agreement any time after Oct. 1 with 30 days written notice.

If Collins & Aikman no longer has or is using molds for a particular customer program, the adequate protection payments will be reduced to $12.75 million for a DaimlerChrysler program, $248 for a Ford program, $5,657 for a General Motors program, $1,578 for a Honda program, $1,346 for a JCI program, $7,638 for a Delphi program, $423 for a Nissan program and $359 for a Premier Mold program.

Collins & Aikman, a Troy, Mich.-based automotive company, filed for Chapter 11 on May 17, 2005. The case number is 05-55927.

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