SECURITIES AND EXCHANGE COMMISSION

~~Washington~~WASHINGTON, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED OCTOBER 31, 2004

FOR THE QUARTERLY PERIOD ENDED JULY 31, 2004

Commission File Number 001-08941*

FRUIT OF THE LOOM UNSECURED CREDITORS TRUST

(Exact name of registrant as specified in its charter)


Delaware		04-6979618
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

c/o Clingman & Hanger Management Associates, LLC 11038 Lakeridge Parkway, Suite 4 Ashland, VA		23005
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: 804-550-7911

Securities registered pursuant to Section 12(b) of the Act: NONE

Securities registered pursuant to Section 12(g) of the Act: NONE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Not applicable. Reference is made to the Form 15 filed on May 2, 2002.

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). ~~Yes ¨ No x~~

Yes ¨ No x

State the aggregate market value of the voting and non-voting common equity held by non-affiliates. Not applicable.

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Not Applicable

DOCUMENTS INCORPORATED BY REFERENCE: NONE

Fruit Of The Loom Unsecured Creditors Trust is a transferee of certain of the assets and liabilities of Fruit of the Loom, Inc., and files reports under Fruit of the Loom, Inc.’s former Commission file number. Fruit of the Loom, Inc. filed a Form 15 on May 2, 2002, indicating its notice of termination of registration and filing requirements.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION
		Page
ITEM 1.	FINANCIAL STATEMENTS.		1
PART I – FINANCIAL INFORMATION		1
		Cash Balance Sheet at July 31, 2004 and April 30, 2004	1
ITEM 1 – FINANCIAL STATEMENTS		1
		Statement of Operations for Three Months Ended July 31, 2004 and 2003	2
	Cash Balance Sheet at October 31, 2004 and April 30, 2004	1
		Statement of Cash Flows for Three Months Ended July 31, 2004 and 2003	3
	Statement of Operations for Six Months Ended October 31, 2004 and 2003	2
		Notes to Financial Statements	4
	Statement of Cash Flows for Six Months Ended October 31, 2004 and 2003	3
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.		8
	Notes to Financial Statements	4
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		11
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	8
ITEM 4.	CONTROLS AND PROCEDURES		12
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	12
PART II – OTHER INFORMATION
ITEM 4.	CONTROLS AND PROCEDURES	12
ITEM 1.	LEGAL PROCEEDINGS		12
PART II – OTHER INFORMATION		12
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		12
ITEM 1.	LEGAL PROCEEDINGS	12
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES		13
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	13
ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS		13
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	13
ITEM 5.	OTHER INFORMATION		13
ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	13
ITEM 6.	EXHIBITS AND REPORTS ON FORM 8-K		13
ITEM 5.	OTHER INFORMATION	13
SIGNATURES			14
ITEM 6.	EXHIBITS	13
INDEX TO EXHIBITS			15
SIGNATURES		14
EXHIBIT INDEX		15

This report includes “forward-looking statements”. These forward-looking statements include, but are not limited to, statements about our plans, objectives, representations and contentions and are not historical facts, and typically may be identified by use of terms such as “anticipate,” “believe,” “estimate,” “plan,” “may,” “expect,” “intend,” “could,” “potential,” and similar expressions, although some forward-looking statements are expressed differently. You should be aware that the forward-looking statements included in this report represent the Trustee’s current judgment and expectations, but our actual results, events and performance could differ materially from those in the forward-looking statements. The forward looking statements are subject to a number of risks and uncertainties. We do not intend to update any of these factors or to publicly announce the results of any revisions to these forward-looking statements.

PART I – FINANCIAL INFORMATION

ITEM 1 – FINANCIAL STATEMENTS

Fruit Of The Loom

Unsecured Creditors Trust

Cash Balance Sheet

(unaudited)

	As of July 31, 2004		As of April 30,2004
	As ofOctober 31, 2004		As ofApril 30, 2004
Assets:
Cash	$	8,~~319~~098,~~957~~757	$	8,910,414
Total Assets	$	8,~~319~~098,~~957~~757	$	8,910,414
Liabilities (Reserves) :
Distribution Reserve for Allowed and Disputed Claims	$	7,~~862~~239,~~043~~248	$	8,268,675
Case Administration Expense Reserve	$	~~457~~859,~~914~~509	$	641,739
Total Liabilities (Reserves)	$	8,~~319~~098,~~957~~757	$	8,910,414

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Fruit Of The Loom

Unsecured Creditors Trust

Statement of Operations

(unaudited)

	Quarter Ended July 31						Twenty Seven MonthsFrom Trust InceptionThrough July 31, 2004
	Quarter EndedOctober 31						Six Months EndedOctober 31						Thirty Months From Trust Inception ThroughOctober 31,2004
	2004			2003			2004			2003
Receipts :
Distributions from FOL Liquidation Trust	$	—		$	~~768~~80,~~539~~056		$	~~20,382,719~~—		$	848,595		$	20,382,719
Initial Funding of UCT Case Administration Expenses	$	—		$	—		$	~~2,705,000~~—		$	—		$	2,705,000
Interest and Other Income	$	2325,~~927~~669		$	3540,~~899~~500		$	~~486~~49,~~464~~596		$	76,399		$	512,133
Total Receipts	$	2325,~~927~~669		$	~~804~~120,~~438~~556		$	2349,~~574,183~~596		$	924,994		$	23,599,852
Disbursements & Expenses :
Distributions from UCT	$	(~~430~~136,~~559~~331	)	$	(645,~~633,274~~027	)	$	(13566,~~007,140~~890	)	$	(6,678,301	)	$	(13,143,471	)
Trust Expense	$	(~~183~~110,~~825~~538	)	$	(~~307~~262,~~651~~719	)	$	(2294,~~247,086~~363	)	$	(570,370	)	$	(2,357,624	)
Total Disbursements & Expenses	$	(~~614~~246,~~384~~869	)	$	(6307,~~940,925~~746	)	$	(15861,~~254,226~~253	)	$	(7,248,671	)	$	(15,501,095	)
Net Receipts (Disbursements & Expenses)	$	(~~590~~221,~~457~~200	)	$	(6187,~~136,487~~190	)	$	8(811,~~319,957~~657	)	$	(6,323,677	)	$	8,098,757

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Fruit Of The Loom

Unsecured Creditors Trust

Statement of Cash Flows

(unaudited)

	Three Months EndedJuly 31, 2004			Three Months EndedJuly 31, 2003			TwentySeven Months FromTrust Inception Through July 31, 2004
	Six Months EndedOctober 31,2004			Six Months EndedOctober 31,2003			Thirty Months FromTrust InceptionThroughOctober 31,2004
Cash at Beginning of Period	$	8,910,414		$	17,431,268		$	—
Cash Flow from Unsecured Creditor Trust Funding :
Distributions from FOL Liquidation Trust	$	—		$	~~768~~848,~~539~~595		$	20,382,719
Initial Funding of UCT Case Administration Expenses	$	—		$	—		$	2,705,000
Total	$	—		$	~~768~~848,~~539~~595		$	23,087,719
Cash Flow from Investing Activities :
Interest and Other Income	$	2349,~~927~~596		$	3576,~~899~~399		$	~~486~~512,~~464~~133
Total	$	2349,~~927~~596		$	3576,~~899~~399		$	~~486~~512,~~464~~133
Cash Flow from Trust Operations :
Distributions from UCT	$	(~~430~~566,~~559~~890	)	$	(6,~~633~~678,~~274~~301	)	$	(13,~~007~~143,~~140~~471	)
Trust Expense	$	(~~183~~294,~~825~~363	)	$	(~~307~~570,~~651~~370	)	$	(2,~~247~~357,~~086~~624	)
Total	$	(~~614~~861,~~384~~253	)	$	(67,~~940~~248,~~925~~671	)	$	(15,~~254~~501,~~226~~095	)
Net Cash Flow	$	(~~590~~811,~~457~~657	)	$	(6,~~136~~323,~~487~~677	)	$	8,~~319~~098,~~957~~757
Cash at the end of period	$	8,~~319~~098,~~957~~757		$	11,~~294~~107,~~781~~591		$	8,~~319~~098,~~957~~757

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FRUIT OF THE LOOM

UNSECURED CREDITORS TRUST

NOTES TO THE FINANCIAL STATEMENTS

(UNAUDITED)

1.	General

On December 29, 1999, Fruit of the Loom, Inc. (“FTL”) filed with the United States Bankruptcy Court for the District of Delaware (the “Court”) a voluntary petition for relief under Chapter 11 of the Bankruptcy Code. The Third Amended Joint Plan of Reorganization of Fruit of the Loom, et. al. (the “Plan”) was confirmed by the Court on April 19, 2002. The Plan became effective on April 30, 2002 (the “Effective Date”). In accordance with the Plan, the apparel business of Fruit of the Loom was sold to Berkshire Hathaway, Inc. pursuant to the Asset Purchase Agreement by and between Fruit of the Loom, Ltd., Fruit of the Loom, Inc., Union Underwear, Inc., FTL Caribe, Ltd. (the “Sellers”) and New FOL, Inc. (the “Purchaser”) and Berkshire Hathaway, Inc.

The Fruit of the Loom Unsecured Creditors Trust (the “UCT”) was established pursuant to the Plan. The operation of the UCT is governed by the Plan and the UCT Agreement executed pursuant thereto. Terms which are not defined herein are defined in the Plan and the UCT Agreement. Clingman & Hanger Management Associates, LLC serves as the Trust Administrator (the “Trustee”) of the UCT. The UCT was established to perform certain obligations of FTL under the Plan, including: (a) receiving distributions from the FOL Liquidation Trust intended for holders of Allowed Class 4A Claims (the “Claims”) and distributing those funds to those holders; (b) holding and distributing any proceeds received from the Creditors’ Committee Actions,; (c) having the exclusive authority to prosecute, settle or otherwise resolve objections to Disputed Claims and to prosecute, settle or otherwise resolve the Creditors’ Committee Action; and (d) such other purposes as set forth in the Plan and the UCT Agreement.

otherwise resolve objections to Disputed Claims and to prosecute, settle or otherwise resolve the Creditors’ Committee Action and (d) such other purposes as set forth in the Plan and the UCT Agreement.

2.	Beneficiaries and Beneficial Interests

The Beneficiaries of the UCT are the holders of Allowed Class 4A claims. Each holder of an Allowed Class 4A Claim receives an uncertificated beneficial interest in the UCT in proportion to their pro rata share of Claims.

3.	Summary of Significant Accounting Policies and Method of Accounting

The UCT financial statements are prepared on a cash basis of accounting. Transactions (including the recording of interest earned) are recorded when cash is received or disbursed. The Cash Balance Sheet includes cash arising from cash transactions, while the Statement of Operations includes cash receipts as additions and cash disbursements as expenses/deductions. The UCT Agreement, approved by the Court as part of the confirmation of the Plan, provides for the fiscal year of the UCT to end on April 30.

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accompanying information were prepared for the use of the Trustee and the UCT Advisory Committee (“UCTAC”) and for filing with the Court in accordance with Section 7.1 of the UCT Agreement.

4.	Commitments, Contingencies and Recoveries

As discussed in Note 13, the financial statements are prepared on a cash basis. Accordingly, no accrual has been made for potential liabilities or recoveries (including interest earned but not yet received or estimates of future distributions from the FOL Liquidation Trust). However, the UCT has established Disputed Claim Reserves and Other Reserves as required or allowed by the Plan and the UCT Agreement, which reserves have been established in the reasonable business judgment of the Trustee and pursuant to order of the Court as described in Note 5.

5.	Claims, Distributions and Reserves

The UCT has filed various Omnibus Objections to Claims and, after notice and hearing, orders allowing and expunging claims of non-responding claimants were entered by the Court. The UCT has resolved certain other claims on a consensual basis.

On the Effective Date, there were approximately 3,450 Class 4A Claims. As of ~~July~~October 31, 2004, there ~~are~~were approximately 1,~~931~~930 Class 4A Claims remaining, of which 1,~~561~~827 have been Allowed, leaving approximately ~~370~~103 Disputed Claims.

With the approval of the Court, the UCT made its first distribution to holders of the Initial Allowed Claims on October 30, 2002 as required by Section 4.5(b) of the UCT Agreement. Section 8.6 of the Plan provides that on the Initial Distribution Date, the UCT shall establish a Reserve for Disputed Claims, consisting of the ratable proportion of all cash allocated for distribution on account of each Disputed Claim based upon the asserted amount of each Disputed Claim or such amount as may be agreed to by the holder of the Claim and the UCT or as may otherwise be determined by the Court. On September 18, 2002, the UCT filed a motion (the “First Reserve Motion”) with the Court to establish the amount of the Disputed Reserve. On October 10, 2002, the Court granted the UCT’s First Reserve Motion and entered an order approving the Initial Distribution and the Disputed Reserves Proposed in the First Reserve Motion (the “Initial Distribution Reserve Order”). Based upon the amount of the claims for which reserves were established, an Initial Distribution of 3.9297% was authorized by the court and made by the UCT to holders of Allowed Claims as described below.

On July 30, 2003, the UCT made its Second Distribution in the amount of 4.5446% to holders of Allowed Claims pursuant to the reserving methodology approved by the Court for the First Reserve Motion. This brings the total distribution to holders of Allowed Claims to 8.4743% as of ~~July~~October 31, 2004, which is the distribution rate applicable to holders of Allowed Claims which have been allowed subsequent to July 1, 2003.

As of ~~July~~October 31, 2004, 1,~~561~~827 claims have been allowed in the total amount of $~~165~~172,~~796~~684,~~249~~388. The Initial Distribution of 3.9297% and the Second Distribution of 4.5446%, totalling 8.4743%, has been disbursed to holders of 1,~~373~~460 Allowed Claims who have provided the UCT with taxpayer identification numbers as required by the UCT Agreement. As of ~~July~~ October 31, 2004, $13,~~007~~143,~~140~~471 ~~has~~had been disbursed and the UCT ~~continues~~continued to hold $1,~~042~~490,~~932~~322 for ~~188~~367 holders of ~~Allowed Claims who have not provided the taxpayer identification information required by the UCT Agreement. Such funds will be disbursed upon~~ ~~receipt of the necessary taxpayer identification numbers.~~

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Allowed Claims who have not provided the taxpayer identification information required by the UCT Agreement. Such funds will be disbursed upon receipt of the necessary taxpayer identification numbers.

Except as set forth in the First Reserve Motion, the UCT did not seek estimation of individual claims, but rather an estimation of certain categories of claims as described therein. This approach has less adverse impact upon the claimants than would the estimation of each claim, because the aggregate estimation does not limit any individual claimant’s claim. Notwithstanding anything contained herein or in the First Reserve Motion, the amounts reflected herein for the Disputed Claims are for reserve purposes only, and the UCT reserves the right to object to any claim, and to continue to pursue any pending objection to any claim.

During the quarter ended ~~July~~October 31, 2004, the UCT received no distributions from the FOL Liquidation Trust. During the Quarter ended ~~July~~October 31, 2003, the UCT ~~received~~ received distributions from the FOL Liquidation Trust in the amount of $~~768~~80,~~539~~056. Since the Effective Date, the UCT has received distributions from the FOL Liquidation Trust in the aggregate amount of $20,382,719. All of the amounts received from the ~~FOL~~ FOL Liquidation Trust, net of distributions to holders of Allowed Claims, are in the cash balances as part of the Reserve for Allowed and Disputed Claims. As of ~~July~~October 31, 2004, the UCT ~~holds~~held total reserves of $7,~~862~~239,~~043~~248 for Allowed and Disputed Claims. As of April 30, 2004, the UCT held total reserves of $8,268,675 for Allowed and Disputed Claims.

6Pursuant to Section 7.23.5 of the Plan, the UCT received $2,705,000, which is allocated solely for trust expenses and which is to be returned to the FOL Liquidation Trust to the extent not used for such expenses. Previously, the Trustee has allocated interest income to the Distribution Reserve for Allowed and Disputed claims and reported that with the possible exception that such interest might be needed for case administration expenses, the UCT did not anticipate that any of the other funds received from the FOL Liquidation Trust and allocated to the Distribution Reserve for Allowed and Disputed claims would be needed for case administration expenses. The UCT determined during the quarter ended October 31, 2004 , as allowed by the UCT Agreement, to reallocate $512,133 (which amount is equivalent to the interest earned since the inception of the UCT) from the Distribution Reserve for Allowed and Disputed Claims to the Case Administration Reserve effective October 31, 2004, and to allocate interest earned in the future to the Case Administration Reserve in order to provide adequate resources for the payment of case administration expenses. To the extent interest earned is not needed for case administration expenses, it will be distributed to the Beneficiaries as part of the final distribution.

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~~Pursuant to Section 7.23.5 of the Plan, the UCT received $2,705,000, which is allocated solely for trust expenses and~~ ~~which is to be returned to the FOL Liquidation Trust to the extent not used for such expenses. At this time, while reserving all of its rights~~ with respect thereto, the UCT ~~believes~~thus ~~that,~~still with the possible exception that a portion of the UCT’s interest income which has been added to the reserve and may be needed for trust expenses, no additional funds need be allocated from the funds currently held in the Distribution Reserve for Allowed and Disputed Claims as possible funding for trust expenses of case administration. The UCT anticipates that all of the funds held in the Case Administration Reserve will be used for case administration expenses, and that any amount needed beyond such reserve should be less than the interest earned by the UCT since its inception. The UCT thus anticipates that all or substantially all of the distributions received from the FOL Liquidation Trust will be used for distributions to holders of Beneficial Interests and not for the funding of trust expenses. Accordingly, the amounts expended for trust expenses are not anticipated to significantly impact the distributions to the holders of Allowed Claims in Class 4A due to the separate funding of the UCT’s trust expenses and interest earned by the UCT on its investments.

6.	Trust Termination

The UCT Agreement provides that the UCT shall terminate upon the distribution of all assets held in the UCT but not later than three years after the Effective Date; provided, however, if the Trustee determines it to be in the best interest of the Beneficiaries, and subject to the approval of the Court, the term of the UCT may be extended for one or more finite terms. The UCT Agreement originally provided that the UCT would terminate not later than five years after the Effective Date (subject to extension with approval of the Court). In conjunction with commencement of periodic reporting to the Securities and Exchange Commission (“SEC”), the UCT and the UCTAC amended the UCT Agreement to provide for the UCT’s termination not later than three years after the Effective Date (subject to extension with approval of the Court). toDuring bethe ~~consistent~~quarter ~~with~~ended ~~published~~October ~~advice~~31, ~~from~~2004, the ~~SEC~~FOL toLiquidation ~~other~~Trust ~~liquidating~~advised the UCT that it does not ~~trusts~~anticipate a final distribution to the UCT until the second calendar quarter of 2005 or later. While the UCT anticipates that its claim resolution work will be completed prior to the three year anniversary date on April 30, 2005, the UCT will need to continue its existence until it has received all of its distributions from the FOL Liquidation Trust. ~~The~~ ~~FOL Liquidation Trust has indicated that additional distributions will be made to the UCT but has not advised as to the anticipated amount or timing of additional distributions.~~ Thus, even if the UCT has completed its claim resolution work as currently anticipated, it ~~may~~ will be necessary to apply to the Court for an extension of the UCT’s termination date to ~~ensure~~enable ~~that~~ the Beneficiaries to receive all amounts to which they are entitled under the Plan. The UCT anticipates applying to the Court for an extension of the UCT’s termination date during the first calendar quarter of 2005.

7.	Income Tax Status

The receipt of the uncertificated interest in the UCT constitutes full satisfaction of a Beneficiary’s claim against FTL. Pursuant to the Plan, as of the Effective Date, a Beneficiary was deemed to have received its allocable share of the assets that were then deemed contributed to the UCT.

Upon the advice of tax counsel, the UCT determined that Grantor Trust Statements were required to be issued after the end of the UCT’s first fiscal year, which was April 30, 2003. Accordingly, 2003 Grantor Trust Statements were issued to Beneficiaries reporting required tax information, including each grantor’s share of the income, gain, deductions, loss or credits of the UCT attributable to the period from the date of the UCT’s formation through the end of the UCT’s first fiscal year on April 30, 2003, with the amounts so reported to be reflected on the Beneficiary’s appropriate 2003 tax return. Similarly, Grantor Trust Statements reporting required tax information will be issued to Beneficiaries, including each grantor’s share of the income, gain, deductions, loss or credits of the UCT attributable to the UCT’s second fiscal year (which ended April 30, 2004), with the amounts so reported to be reflected on the Beneficiary’s appropriate tax return for 2004.

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Beneficiary’s appropriate 2003 tax return. Similarly, Grantor Trust Statements reporting required tax information will be issued to Beneficiaries at the time the Grantor Trust Statements are issued, including each grantor’s share of the income, gain, deductions, loss or credits of the UCT attributable to each fiscal year ending April 30th, with the amounts so reported to be reflected on the Beneficiary’s appropriate tax return for the tax year in which the UCT’s tax year ends.

All entities that receive distributions under the Plan are responsible for reporting and paying, as applicable, taxes on account of their distributions. Each Beneficiary is strongly advised to consult its own tax advisor regarding the federal, state, local and foreign tax consequences of holding or disposing of an interest in the UCT and of receiving distributions from the UCT.

8.	Disbursements and Expenses

The Statement of Operations includes a section titled “Disbursements & Expenses” and the Statement of Cash Flows includes a section titled “Cash Flow from Trust Operations”. Both of these sections have line items titled “Distributions by UCT” and “Trust Expenses”. Set forth below are the descriptions of the types of disbursements and expenses included in each line item:

Distributions

These amounts represent payments made to the holders of newly Allowed Claims in Class 4A, as described in Note 5. Distributions have been made to holders of newly Allowed Claims during the quarter ended ~~July~~October 31, 2004 in the aggregate amount of $~~430~~136,~~559~~331. Distributions of $645,~~633,274~~027 were made to holders of newly Allowed Claims during the quarter ended ~~July~~October 31, 2003. Aggregate distributions since the inception of the trust total $13,~~007~~143,~~140~~471, representing 8.4743% of Allowed Claims to holders who have provided taxpayer identification numbers as required by the Plan.

Trust Expenses

These amounts represent payment of expenses of the UCT, including trust administration, professional fees, claims resolution, and other costs. Trust expenses include the fees of the Trustee which are paid pursuant to the fee arrangement agreed to and approved by the UCTAC upon the appointment of the Trustee in conjunction with confirmation of the Plan and the formation of the UCT.

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion should be read in conjunction with our financial statements and related notes included in this Form 10-Q.

Application of Critical Accounting Policies

The Trustee believes the following critical accounting policies, among others, are subject to significant judgments and estimates used in the preparation of these financial statements.

Cash Basis of Accounting

The UCT financial statements are prepared on a cash basis of accounting. Transactions (including the recording of interest earned) are recorded when cash is received or disbursed. The Cash Basis Balance Sheet includes cash arising from cash transactions, while the Statement of Operations includes cash receipts as additions and cash disbursements as ~~expenses/deductions. The UCT Agreement, approved by the Court as part of the confirmation of the Plan, provides for the fiscal year of the UCT to end on April 30.~~

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expenses/deductions. The UCT Agreement, approved by the Court as part of the confirmation of the Plan, provides for the fiscal year of the UCT to end on April 30.

The UCT’s financial statements present, to the best of the Trustee’s knowledge, the cash receipts and disbursements from the UCT for the period reported. The financial reports and accompanying information were prepared for the use of the Trustee and the UCTAC and for filing with the Court in accordance with Section 7.1 of the UCT Agreement. While not required under generally accepted accounting principles, the Trustee believes that reporting financial information from the date of the inception of the UCT is meaningful for holders of Beneficial Interests, in addition to reporting fiscal year information, and accordingly has included such information in these financial reports.

Reserves

No accrual has been made for potential liabilities or recoveries (including interest earned but not yet received or estimates of future distributions from the FOL Liquidation Trust). However, the UCT has established Disputed Claim Reserves and Other Reserves as required or allowed by the Plan and the UCT Agreement, which reserves have been established in the reasonable business judgment of the Trustee and pursuant to order of the Court.

Tax Status

The UCT is intended to qualify as a liquidating trust for federal income tax purposes, and therefore should be taxable as a grantor trust. The holders of Beneficial Interests will be treated as grantors; accordingly, their pro rata share of all items of income, gain, loss, deduction and credit will be included in the income tax returns of the holders of Beneficial Interests.

Changes in net assets

Funding from FOL Liquidation Trust and Investment Income

During the quarter ended ~~July~~ October 31, 2004, the UCT received no distributions from the FOL Liquidation Trust and received interest on invested funds in the amount of $2325,~~927~~669. During the quarter ended ~~July~~October 31, 2003, the UCT received distributions from the FOL Liquidation Trust in the aggregate amount of $~~768~~80,~~539~~056 and received interest on invested funds in the amount of $3540,~~899~~500. Since its inception, the UCT has received distributions from the FOL Liquidation Trust in the aggregate amount of $20,382,719. The UCT’s investments have yielded interest income in the amount of $~~486~~512,~~464~~133 since its inception.

Reserves

In accordance with the terms of the Plan and the Initial Distribution, the UCT has established reserves for allowed and disputed claims. The Disputed Claims reserve consists of the ratable proportion of all cash allocated for distribution on account of each disputed claim based upon the asserted amount of each disputed claim or such amount as may be agreed to by the holder of the Claim and the UCT or as may otherwise be determined by the Court. As of ~~July~~October 31, 2004, the UCT ~~holds~~held total reserves of $7,~~862~~239,~~043~~248 for Allowed and Disputed Claims, ~~including $1,042,932 for 188 holders of Allowed Claims who have not provided the taxpayer~~ identification information required by the UCT Agreement. As of April 30, 2004, the UCT held total reserves of $8,268,675 for Allowed and Disputed Claims. The reserve for Allowed and Disputed Claims decreased on account of distributions made to holders of Allowed Claims and resolution of Disputed Claims.

~~The~~-9- UCT also holds a Case Administration Expense Reserve in the amount of $457,914 as of July 31, 2004, which is to be used to fund expenses of adminstering the UCT, as more particularly described in the Trust Expenses section below. As of April 30, 2004, the Case Administration Expense Reserve was $641,739. The decrease in this reserve is due to payment of trust expenses.

including $1,490,322 for 367 holders of Allowed Claims who have not provided the taxpayer identification information required by the UCT Agreement. As of April 30, 2004, the UCT held total reserves of $8,268,675 for Allowed and Disputed Claims. The reserve for Allowed and Disputed Claims decreased on account of distributions made to holders of Allowed Claims, resolution of Disputed Claims and the UCT’s decision effective October 31, 2004 to reallocate $512,133 (which amount is equivalent to the interest earned since the inception of the UCT) from the Distribution Reserve for Allowed and Disputed Claims to the Case Administration Reserve as described in Note 5 to the Financial Statements.

The UCT also holds a Case Administration Expense Reserve in the amount of $859,509 as of October 31, 2004, which is to be used to fund expenses of administering the UCT, as more particularly described in the Trust Expenses section below. As of April 30, 2004, the Case Administration Expense Reserve was $641,739. The increase in the reserve is due to the UCT’s decision effective October 31, 2004 to reallocate $512,133 (which amount is equivalent to the interest earned since the inception of the UCT) from the Distribution Reserve for Allowed and Disputed Claims to the Case Administration Reserve as described in Note 5 to the Financial Statements. The $217,770 increase in the Case Administration Reserve from April 30, 2004 to October 31, 2004 is the net change of resulting from the $512,133 reallocation to the reserve at October 31, 2004 less the $294,363 of trust expenses disbursed during the six months ended October 31, 2004.

Distributions

An Initial Distribution of 3.9297% was authorized by the court and made by the UCT to holders of Allowed Claims on October 30, 2002 in accordance with the Initial Distribution Reserve Order, and periodically thereafter to holders of subsequently Allowed Claims. On July 30, 2003, the UCT made its Second Distribution in the amount of 4.5446% to holders of Allowed Claims using the the reserving methodology approved by the Court for the Initial Distribution. This brings the total distribution to holders of Allowed Claims to 8.4743% as of ~~July~~October 31, 2004, which is the distribution rate received by holders of Allowed Claims which have been allowed subsequent to July 31, 2003.

Distributions have been made to holders of newly Allowed Claims during the quarter ended ~~July~~October 31, 2004 in the aggregate amount of $~~430~~136,~~559~~331. Distributions of $645,~~633,274~~027 were made to holders of newly Allowed Claims during the quarter ended October ~~July~~ 31, 2003. Aggregate distributions since the inception of the trust total $13,~~007~~143,~~140~~471, representing 8.4743% of Allowed Claims for which required taxpayer identification information has been provided.

Outstanding Claims

On the date of inception of the UCT, there were approximately 3,450 Class 4A Claims. The UCT has filed various objections to Claims and, after notice and hearing, orders allowing and expunging claims of non-responding claimants were entered by the Court. The UCT has resolved certain other claims on a consensual basis. As a result, on ~~July~~October 31, 2004, there are approximately 1,~~931~~930 Class 4A Claims remaining. Of this amount, 1,~~561~~827 claims totalling ~~$165,796,249 have been allowed. There remain approximately 370 Disputed Claims as of July 31, 2004.~~

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$172,684,388 have been allowed. There remain approximately 103 Disputed Claims as of October 31, 2004.

Trust Expenses

During the quarter ended ~~July~~October 31, 2004, the UCT paid expenses totalling $~~183~~110,~~825~~538, which include trust administration, professional fees, claims resolution, and other costs. During the quarter ended ~~July~~October 31, 2003, the UCT paid expenses totaling $~~307~~262,~~651~~719. Since its inception, the UCT has paid trust expenses totalling $2,~~247~~357,~~086~~624. Trust expenses include the fees of the Trustee, which are paid pursuant to the fee arrangement agreed to and approved by the UCTAC upon the appointment of the Trustee in conjunction with confirmation of the Plan and the formation of the UCT.

Pursuant to the Plan, the UCT received $2,705,000, which is allocated solely for trust expenses and which is to be returned to the FOL Liquidation Trust to the extent not used for such expenses. AtPreviously, ~~this~~the ~~time,~~Trustee ~~while~~has ~~reserving~~allocated ~~all~~interest ofincome ~~its~~to ~~rights~~the ~~with~~Distribution ~~respect~~Reserve ~~thereto,~~for ~~the~~Allowed ~~UCT~~and ~~believes~~Disputed ~~that,~~claims and reported that with the possible exception that asuch ~~portion~~interest ofmight ~~the~~be ~~UCT’s~~needed ~~interest~~for ~~income~~case ~~which has~~administration ~~been~~expenses, ~~added to~~ the ~~reserve~~UCT ~~and~~did ~~may~~not beanticipate ~~needed~~that ~~for~~any ~~trust~~of ~~expenses,~~the noother ~~additional~~ funds ~~need~~received ~~be allocated~~ from the ~~funds~~FOL ~~currently~~Liquidation ~~held~~Trust inand allocated to the Distribution Reserve for Allowed and Disputed ~~Claims~~claims aswould ~~possible~~be ~~funding~~needed for ~~trust expenses of~~ case administration expenses. The UCT ~~anticipates~~determined ~~that~~during ~~all of~~ the ~~funds~~quarter ~~held~~ended inOctober ~~the~~31, ~~Case~~2004 ~~Administration~~, ~~Reserve~~as ~~will~~allowed beby ~~used~~the ~~for~~UCT ~~case administration expenses~~Agreement, ~~and~~to ~~that~~reallocate ~~any~~$512,133 (which amount ~~needed~~is ~~beyond~~equivalent ~~such~~to ~~reserve should be less than~~ the interest earned bysince the ~~UCT since~~ ~~its~~ inception. ~~The~~of the UCT) ~~thus~~from ~~anticipates~~the ~~that~~Distribution ~~all~~Reserve orfor ~~substantially~~Allowed ~~all~~and ofDisputed ~~the~~Claims ~~distributions~~to ~~received from~~ the ~~FOL~~Case ~~Liquidation~~Administration ~~Trust~~Reserve ~~will~~effective beOctober ~~used~~31, ~~for~~2004, ~~distributions~~and to ~~holders~~allocate ofinterest ~~Beneficial~~earned ~~Interests.~~in ~~Accordingly,~~ the ~~amounts~~future ~~expended~~to ~~for~~the ~~trust expenses~~Case ~~are~~Administration ~~not~~Reserve ~~anticipated~~in order to ~~significantly~~provide adequate ~~impact~~resources ~~the~~for ~~distributions to~~ the ~~holders~~payment of ~~Allowed~~case ~~Claims~~administration inexpenses. ~~Class~~To 4Athe ~~due~~extent tointerest ~~the~~earned ~~separate~~is ~~funding~~not ofneeded ~~the~~for ~~UCT’s~~case ~~trust~~administration expenses, byit ~~the~~will ~~Case~~be ~~Administration~~distributed ~~Expense~~to ~~Reserve~~the ~~and~~Beneficiaries ~~interest~~as ~~earned~~part byof the ~~UCT~~ onfinal ~~its investments~~distribution.

A factor in the Trustee’s decision to reallocate an amount equal to interest earned to the Case Administration Reserve was the FOL Liquidation Trust informing the UCT during the quarter that it does not anticipate a final distribution to the UCT until the second calendar quarter of 2005 or later. As discussed in Note 6 to the Financial Statements, the UCT is currently scheduled to terminate on April 30, 2004 and the UCT will apply to the Court for an extension of the termination date to enable the Beneficiaries to receive all amounts to which they are entitled under the Plan. If the FOL Liquidation Trust makes a final distribution to the UCT within the second calendar quarter of 2005, the UCT currently anticipates that the original $2,705,000 funding of the Case Administration Reserve, together with interest earned by the UCT since its inception, will be adequate to fund trust expenses through the UCT’s termination. While reserving all of its rights with respect thereto, the UCT thus still anticipates that all or substantially all of the distributions received from the FOL Liquidation Trust will be used for distributions to holders of Beneficial Interests and not for the funding of trust expenses. Accordingly, the amounts expended for trust expenses are not anticipated to significantly impact the distributions to the holders of Allowed Claims in Class 4A due to the separate funding of the UCT’s trust expenses and interest earned by the UCT on its investments.

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ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

The Reserves held by the UCT are invested through, and with the investment advice of, the Trust Department of Wachovia Bank, N.A. The UCT’s holdings of financial instruments are comprised primarily of government agency securities and investment grade corporate securities. All such instruments are classified as securities held to maturity. The UCT seeks reasonable assurance of the safety of principal and market liquidity by investing in rated fixed income securities. Its market risk exposure consists principally of exposure to changes in interest rates. Its holdings are also exposed to the risks of changes in the credit quality of issuers. The UCT typically invests in the shorter end of the maturity spectrum and the Trustee believes that changes in interest rates would not have a material effect on the fair value of UCT holdings. All cash is invested in interest bearing instruments until disbursed.

ITEM 4.

CONTROLS AND PROCEDURES.

(a) Evaluation Of Disclosure Controls And Procedures

The UCT’s Trustee, after evaluating the effectiveness of the UCT’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-14(c) and 15d-14(c)) as of the end of the period covered by this quarterly report (the “Evaluation Date”), have concluded that as of the Evaluation Date, the UCT’s disclosure controls and procedures were adequate and effective to ensure that material information relating to the UCT would be made known to them by others within the UCT, particularly during the period in which this quarterly report was being prepared.

(b) Changes in Internal Controls

There were no significant changes in the UCT’s internal controls or in other factors that could significantly affect the UCT’s internal controls and procedures subsequent to the Evaluation Date, nor any significant deficiencies or material weaknesses in such internal controls and procedures requiring corrective actions.

PART II – OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS

Pursuant to the Plan, the UCT operates under the jurisdiction and supervision of the United States Bankruptcy Court for the District of Delaware and will continue to do so until the UCT has received its final distribution from the FOL Liquidation Trust, all general unsecured claims are resolved and the UCT is terminated pursuant to the terms of the Plan.

Since its inception, the UCT has filed various Omnibus Claims Objections motions with the Court in connection with bankruptcy claims resolution. Most of the general unsecured claims as to which objections were previously filed have been resolved either consensually or by default order entered by the Court. The Court retains ~~jursidiction~~jurisdiction to hear disputed claims matters in the event that the parties are unable to consensually resolve any of the remaining claims as to which objections are pending. The UCT anticipates filing additional Claims objections in the future.

~~The~~-12- UCT is not aware of any facts or circumstances giving rise to any claims that would result in litigation against the UCT, nor is the UCT planning to file suit against any third party, except as it may relate to claims resolution

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Not Applicable

The UCT is not aware of any facts or circumstances giving rise to any claims that would result in litigation against the UCT, nor is the UCT planning to file suit against any third party, except as it may relate to claims resolution.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Not Applicable.

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

Not Applicable.

ITEM 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not Applicable.

ITEM 5.

OTHER INFORMATION

Not Applicable.

ITEM 6. EXHIBITS ~~AND REPORTS ON FORM 8-K~~

A. Exhibits



31.		Certification pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.		Certificate pursuant to Section 906 of the Sarbanes – Oxley Act of 2002.

~~31. Certification pursuant to Rule 13a~~-~~14(a) and 15d~~13-~~14(a),~~ ~~as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.~~

32. Certificate pursuant to Section 906 of the Sarbanes – Oxley Act of 2002.

B. Reports on Form 8-K

None

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, we have duly caused this report to be signed on our behalf by the undersigned, thereunto duly authorized.

FRUIT OF THE LOOM UNSECURED CREDITORS TRUST By: Clingman & Hanger Management Associates, LLC as Trust Administrator By: /sS/ W. ~~Edward~~EDWARD ~~Clingman~~CLINGMAN, JrJR. W. Edward Clingman, Jr. Principal

Date: ~~September~~December 14, 2004

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~~Exhibit~~ EXHIBIT ~~Index~~INDEX

31. Certification pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.



31.		Certification pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.		Certificate pursuant to Section 906 of the Sarbanes – Oxley Act of 2002.

~~32. Certificate pursuant to Section 906 of the Sarbanes~~-~~Oxley~~15- ~~Act of 2002.~~

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Filing Compare · FRUIT OF THE LOOM UNSECURED CREDITORS TRUST