Hawker Beechcraft has reached a settlement with the Pension Benefit Guaranty Corp., allowing for termination of two pension plans and removing the Wichita-based planemaker’s largest impediment to approval of its bankruptcy reorganization. Hawker Beechcraft filed papers in U.S. Bankruptcy Court for the Southern District of New York on Dec. 21 to approve a settlement with the PBGC, allowing termination of the pension plans for salaried workers and non-union workers in the customer-support arm of the business.
The pension plan for hourly workers will be frozen at the year’s end.
For its part of the settlement, the PBGC will receive $11 million in cash for the release of liens plus an unsecured claim for $419.5 million to be paid with new stock.
The secured lenders will have a so-called call option where they can purchase the stock from the PBGC within three years under a pre-determined formula.