(Corrects paragraph 5 to clarify that the chairman and not the chief executive will be included in the bonus plan)
July 24 (Reuters) - Bankrupt aircraft maker Hawker Beechcraft Inc’s plan to pay $5 million in bonuses to its top management has drawn an objection from a U.S. bankruptcy monitor, who said the executives need to do more than just stay with the company during its reorganization.
U.S. Trustee Tracy Hope Davis, who represents the Justice Department in the bankruptcy case, said in court papers that the proposed plan appeared to be “disguised retention awards”.
Hawker Beechcraft, owned by Goldman Sachs and Onex Corp, has said the plan was necessary because the employees have shouldered additional responsibilities without an increase in compensation.
Davis said the plan does not outline “a set of challenging standards” and “high hurdles” to overcome before retention bonuses could be paid.
The employees who would receive bonuses include the chairman, chief financial officer, general counsel and vice presidents of human resources, global customer support and others.
Hawker Beechcraft filed for Chapter 11 bankruptcy in May, unable to support a $2.5 billion debt load amid a weak market.
The Wichita, Kansas-based maker of business jets, general aviation turboprops and military aircraft has filed a reorganization plan that would give secured lenders at least 81 percent of the company’s equity when it emerges from bankruptcy.
Hawker Beechcraft has also received court approval for talks with Superior Aviation Beijing Co, a little-known Chinese aerospace firm over the sale of the company for $1.79 billion.
The case is In re:Hawker Beechcraft Inc, U.S. Bankruptcy Court, Southern District of New York, No:12-11873. (Reporting by Tanya Agrawal in Bangalore; Editing by Ted Kerr)