Britain's pensions regulator has agreed a cash settlement worth up to 363 million pounds ($451 million) with Philip Green, the former owner of collapsed department store BHS, it said on Tuesday.
The regulator said the arrangement has the support of the trustees of the two BHS pension schemes.
It will see Green provide funding for a new independent pension scheme to give pensioners the option of the same starting pension as they were originally promised by BHS, and higher benefits than they would get from the Pension Protection Fund (PPF).
Billionaire Green owned BHS for 15 years before he sold the loss-making 180-store chain to Dominic Chappell, a serial bankrupt with no retail experience, for one pound in 2015.
BHS went into administration in April 2016 and the last of its stores closed in August. Some 11,000 jobs were lost.