A bankruptcy court judge on Friday denied a request from Hawker Beechcraft to give eight of the Wichita OEM’s “senior leadership team” as much as $5.3 million in bonuses. HBC had filed the request with the U.S. bankruptcy court on August 15, describing the bonuses as based on the achievement of certain incentive goals.
Hawker Beechcraft will not exit bankruptcy by year-end as originally projected, if the court allows the Wichita-based aircraft manufacturer’s request for a 120-day extension filed late Thursday. A court hearing on the extension request is scheduled for August 30.
Responding to a recent filing in bankruptcy court by Hawker Beechcraft, seeking approval for as much as $5.328 million in bonuses for eight top executives, the International Association of Machinists and Aerospace Workers (IAW) has filed a formal objection.
Despite objections from the International Association of Machinists and Aerospace Workers (IAM), the U.S. Bankruptcy Court for the Southern District of New York today approved Hawker Beechcraft’s motion to enter into exclusive negotiations with Superior Aviation Beijing Co. The proposed deal was announced early last week, but required a judge’s approval to proceed.
Hawker Beechcraft filed a restructuring plan on Saturday that outlines how it intends to satisfy creditors as part of its plan to exit bankruptcy by year-end. The filing also gave more details about the number of entities that bid to buy parts or the whole company.
As of mid-June the next hurdle for Hawker Beechcraft was the June 30 deadline to file its plan of reorganization with the U.S. Bankruptcy Court in Manhattan.
“The plan provides specific details regarding how the company plans to pay creditors and allow the business to be successful in the long term,” said an HBC spokeswoman.
In its latest surprise move, would-be broadband provider LightSquared has morphed from a Chapter 11 bankruptcy case, with just a few months to find some closure with its creditors, to having an arrangement with them to allow it to continue in business and spend up to $190 million to fund its operations until September next year.
In a hearing yesterday that lasted barely 10 minutes in U.S. Bankruptcy Court for the Southern District of New York, Hawker Beechcraft made an obligatory filing in compliance with Chapter 11 reporting requirements. As part of the report, HBC noted a $90 million loss for the month of May that included $33 million in operating losses.
Hawker Beechcraft is now just 11 days from a deadline to file its “plan of reorganization” with the U.S. Bankruptcy Court in Manhattan, and it’s possible that the plan could involve the sale of the company. “The plan provides specific details regarding how the company plans to pay creditors and allow the business to be successful in the long term,” an HBC spokeswoman told AIN.
Not quite two weeks after filing for U.S. Chapter 11 bankruptcy protection, Hawker Beechcraft said at EBACE today that it will be “well positioned for the future” when it emerges from bankruptcy this later this year.
“There’s been a lot of misinformation and speculation. We’re going to talk to you about facts,” said Hawker Beechcraft executive vice president of customers Shawn Vick. “Chapter 11 protection should not be confused with liquidation or insolvency. There is simply too much value in Hawker Beechcraft, its people, products and brands to allow that to happen.”