At the last status conference, the Insurance Commissioner advised the Court that he would submit an application regarding the shares distribution for the Mission National Insurance Company Trust and regarding interest payments for Mission National Insurance Company Trust. That motion is on file with the Court, to be heard at the time of this status conference.

The Insurance Commissioner has determined that a substantial distribution may be made to general creditors of the Mission Insurance Company Trust this year, and is readying a motion to approve this distribution. The Insurance Commissioner has determined that a substantial distribution may be made of interest to appropriate approved claimants in Mission National Insurance Company Trust this year, and is readying a motion to approve this distribution. Both motions will be on file within the next thirty days.

These estates operate in the closing stages, with the substantial portion of the assets of the estates distributed to policyholders and general creditors. A substantial sum is being held in reserve in the trusts, pending final wind-up. Sums continue to be collected from the reinsurance debtors of the estates, including in particular insolvent reinsurers which owe the Trusts reinsurance proceeds.

The Rehabilitation Plan Implementation Agreement requires the distribution of Covanta Holding Corporation shares to as Receiver of Holland-America Insurance Company Trust. Mission Insurance Company Trust is a creditor of that Missouri entity. Mission Insurance Company Trust has a substantial approved claim against Holland-America Insurance Company Trust. Holland-America Insurance Company Trust has assets sufficient to satisfy a substantial portion of the claims. The Missouri Receiver's attorneys advise that they are working out some minor creditor issues before negotiating the conditions for payment of the funds.

This Court has previously approved the Rehabilitation Plan Implementation Agreement with Covanta Holding Corporation. Pursuant to this plan, Covanta Holding Corporation assumed the duty to process the Latent Deficiency Claims.

The steps to be followed this year to substantially advance wind-up include:

1.     the motion before the Court to approve the Mission National Insurance Company Trust valuations;
2.     the subsequent motions to approve the dollar amount and logistics of cash distribution;
3.     the actual distribution late this year or early next year of the sums to be distributed;
4.     the distribution of the shares of Covanta Holding Corporation shares.

The ongoing closing process will continue to involve:

1.     The holding of reserves for unexpected contingencies;
2.     The collection of further sums due to the estates, including sums due form the Holland-America Insurance Company Trust wind-up, from the Centaur Insurance Company wind-up and from reinsurer debtors of the Mission companies;
3.     The completion of appropriate unclaimed property procedures.

A copy of the current draft financial statements for the trusts is attached as Exhibit "A".

The Insurance Commissioner's Conclusion

Covanta Holding Corporation's continued progress on the remaining steps it is to complete under the Rehabilitation Plan Implementation Agreement will continue to move this matter toward final wind-up. The Insurance Commissioner continues to collect sums due to the Trusts, but the case does not require frequent hearings in light of its status in closing process. The goal remains to collect the remaining assets and deal with the rehabilitation plan issues, so as to reduce the administration to the collection of the last sums due, and, upon passage of a sufficient time, distribution of the assets held in reserve.

The Insurance Commissioner suggests that a further status conference be set in January 2009.
Respectfully submitted,