In a decision opening the way for Hawker Beechcraft to emerge from Chapter 11 bankruptcy later this month, U.S. Bankruptcy Court today approved the Wichita OEM’s joint plan of reorganization. “Today’s ruling marks the final significant step in the restructuring process,” said Hawker Beechcraft CEO Steve Miller. The company said that, as part of the reorganization, it will be rebranded Beechcraft Corp. and will implement a business plan focused on its turboprop, piston, special mission and trainer/attack aircraft, as well as on its parts, maintenance, repairs and refurbishment businesses, “all of which are profitable and have high growth potential.”

Upon emergence from bankruptcy later this month, its pre-petition secured bank debt, unsecured bond debt and certain general unsecured claims will be canceled, and holders of those claims will receive equity in the reorganized company in percentages negotiated by the major creditors. Effective on the emergence date–which has yet to be announced–the new board of directors will include Donald Cook, Gene Davis, Ralph Heath, David Tolley, Gideon Argov, Robert Johnson and Bill Boisture. Boisture will become CEO of Beechcraft Corp. and Miller will become senior advisor to the board.

The court had already approved the company’s motion to retain J.P.Morgan Securities and Credit Suisse Securities on January 30 to jointly structure, arrange and syndicate $600 million in exit financing, consisting of a term loan and a revolving line of credit. On that same day, the court also approved Hawker Beechcraft’s agreement with the Pension Benefit Guaranty Corporation (PGBC) and the International Association of Machinists to address pension plans within the context of the restructuring efforts. By terms of the agreement, accrued retirement benefits for participants in the company’s hourly/union plan will remain the responsibility of Hawker Beechcraft, while the PBGC will assume responsibility for the company’s base and salaried plans.

Under terms of this approach, the company estimates that 100 percent of union plan participants and more than 99 percent of non-union plan participants will receive the full amount of normal retirement pension benefits that have already vested. The company has reached a separate agreement to compensate those salaried employees and retirees whose pension benefits would otherwise have been reduced.