Bankruptcy Judge Rejects Hawker Beechcraft Bonuses

Stephen Pope

Thursday, August 30, 2012 at 08:08 PM ET

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Hawker 4000

Key Takeaways:

A bankruptcy judge rejected a $5.3 million bonus proposal for eight top Hawker Beechcraft executives, ruling it was merely a retention incentive that lacked "challenging goals."
The bonus plan was opposed by Hawker Beechcraft's union and the U.S. Justice Department's bankruptcy watchdog, although a separate $1.9 million bonus for lower-management employees was previously approved.
Hawker Beechcraft, which filed for bankruptcy in May, is currently in talks for a nearly $1.8 billion acquisition by China-based Superior Aviation Beijing.

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A bankruptcy judge has rejected a proposal to give eight top Hawker Beechcraft executives up to $5.3 million in bonuses, ruling the plan would reward them merely for staying at their jobs.

The judge in the case said the plan amounted to retention incentives, and did not meet legal standards that require “challenging goals” before such payouts are allowed in bankruptcy proceedings.