Hawker Beechcraft received federal bankruptcy court approval on Friday to continue operating during the reorganization process that follows the Wichita OEM’s filing for protection under Chapter 11 the previous day. The court decision will allow HBC to continue paying employees and vendors subsequent to the May 3 bankruptcy filing by allowing it access to $400 million in debtor-in-possession financing that was part of a pre-arranged restructuring.
In an interview yesterday, executive v-p Shawn Vick told AIN the company has set up a schedule for payments to vendors and suppliers that will allow the manufacturer to continue producing airplanes, and that “it is our intent to continue to support aircraft on a business-as-usual basis.”
In a fact sheet, CEO Steve Miller and chairman Bill Boisture made a number of points, among them that part of the “first motions” of the filing are requests for permission to pay employee salaries, wages and benefits. However, it left open the possibility that in order to obtain financing to exit the bankruptcy the company may be required to terminate its pension plan. Such a move would have to be approved and ordered by the bankruptcy court.
Vick emphasized the “protection” aspect of Chapter 11, pointing out, “It is intended to take good companies and protect them while they go through this process. It protects a good many jobs, protects those holding debt and ensures that the company will continue to create value.” He added that while the Chapter 11 process is challenging, “It is where we are, [and] we have a clear view now of where we’re going and how to get there.”