A total of 1,400 current and future retirees of White Rose Inc., an independent food wholesaler based in Carteret, N.J., will see their retirement benefits paid by the Pension Benefit Guaranty Corp.
White Rose and its affiliates, which filed for Chapter 11 bankruptcy protection on Sept. 9, are planning to sell its assets in bankruptcy. According to White Rose's filing in the U.S. Bankruptcy Court in Wilmington, Del., C&S Wholesale Grocers, Inc. will be the lead bidder for its assets. The auction, sale hearing and closing have been scheduled for Oct. 24, 29 and 31, respectively.
White Rose also intends to abandon the pension plan, the Third Amended and Restated Di Giorgio Retirement Plan, which has ended as of Oct. 27. However, PBGC is stepping in and will pay all pension benefits earned by the plan's retirees up to the legal limit of about $59,320 a year for a 65-year-old.
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Retirees will continue to get benefits without interruption, and future retirees can apply for benefits as soon as they are eligible. Employees and retirees who are participants in White Rose's plan will continue to receive benefits from the company until PBGC assumes responsibility.
PBGC has estimated that the plan is only 64 percent funded, with $54.6 million in assets to pay $84.9 million in benefit liabilities. The agency is expected to cover $30.2 million of the $30.3 million shortfall.
The annual maximum benefit guarantee for single-employer participants by the Pension Benefit Guaranty Corp. will increase to $60,136 in 2015, up from $59,318.
PBGC notes that if a plan terminates in 2015 as a result of a bankruptcy that was initiated before the new year, then the older maximum guaranteed rates apply.
The announcement comes after PBGC announced single-employer plans will see their flat premium rates increase to $57 per participant in 2015, up from $49. The per-participant rate in multiemployer plans will increases to $13 per head, up from $12 in 2014.
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