A U.S. Bankruptcy Court judge Friday approved the joint plan of reorganization submitted by Hawker Beechcraft -- pension plan agreements were approved earlier. The judge had asked Thursday that a slight modification be made before issuing a final order regarding reorganization. The plan should become effective by the end of February. The court has approved pension plan agreements involving the Pension Benefit Guaranty Corporation (PBGC) and the International Association of Machinists. The company estimates that very close to 100 percent of participants will see "the full amount of normal retirement pension benefits that have already vested." The court also approved exit financing plans.
Under the agreement accrued retirement benefits for hourly/union plan participants will remain the responsibility of Hawker Beechcraft. Base and salaried workers will fall under PBGC. The company will retain J.P. Morgan and Credit Suisse to arrange $600 million in exit financing. The money will consist of a term loan and a revolving line of credit that will be used to repay claims and fund ongoing operations. The company has begun the process of naming a new board of directors, saying Bill Boisture will become chief executive officer of Beechcraft Corporation and Steve Miller will become senior advisor to the board.