KidsPeace Corp., the operator of a psychiatric hospital and residential treatment centers for children, filed a reorganization plan that includes a settlement of $100 million in potential liability that is owed to the Pension Benefit Guarantee Corp. (PBGC), the Wall Street Journal reported today. According to the proposed reorganization plan filed in bankruptcy court last week, KidsPeace would pay PBGC $13.5 million to settle what the federal agency claims is a $100 million shortfall in its terminated pension plan. KidsPeace won a "distress termination" agreement from PBGC, which will move the duty to pay retirees off its balance sheet. The settlement pays $450,000 in cash up front to PBGC and the remaining $13.05 million will be paid with an interest-free note, under which KidsPeace will make $225,000 payments quarterly.
