Hostess, Insurers Propose Deal Over Policy Collateral

Law360, Chicago (January 14, 2013, 7:25 PM EST) -- Hostess Brand Inc. has reached a proposed deal with ACE American Insurance Co. and its ESIS Inc. affiliate to resolve the bankrupt snack company's motion to dip into cash collateral provided as security for workers' compensation and auto insurance policies, according to a Friday filing in New York bankruptcy court.

Under the tentative deal, the parties agreed that once they win the bankruptcy court's final approval, ACE will withdraw from the collateral holdings and pay to Hostess the sum of all deductible payments it has made...
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