The U.S. Bankruptcy Court approved Hancock Fabrics’ motion for entry of an order authorizing the Debtor to enter into an agreement with the Pension Benefit Guaranty Corporation (PBGC) terminating the pension plan and appointing the PBGC as statutory trustee thereof.
As previously reported, “The PBGC issued the Company a Notice of Determination, dated May 10, 2016 (the ‘Determination Notice’), indicating that (i) the Plan will be unable to pay benefits when due under 29 U.S.C. section 1342(a)(2), (ii) it has determined that the PBGC should be appointed as statutory trustee under 29 U.S.C. section 1342, and (iii) it intends to proceed under 29 U.S.C. section 1348 to have March 31, 2016 established as the termination date with respect to the Plan. Given the cessation of the Debtors’ business and the need to provide for continuity of present and prospective retirement pension benefits to Hancock’s now-former employees, the Debtors have determined that it is in the best interests of their estates to have the Company enter into an agreement with the PBGC to terminate the Plan.”
Court-filed documents continue, “Accordingly, the Company and the PBGC have been negotiating the terms of the PBGC Agreement, which provides, among other things, that (i) the Plan termination date shall be March 31, 2016; and (ii) the PBGC shall be appointed as statutory trustee of the Plan, with all of the rights and powers of a trustee specified in ERISA or otherwise granted by law.”
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