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HawkerBeechcraft execs seek $5.3M Ch11 bonus

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HawkerBeechcraft execs seek $5.3M Ch11 bonus

Old 07-17-2012, 08:02 AM
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Default HawkerBeechcraft execs seek $5.3M Ch11 bonus

Bankrupt Hawker Beechcraft seeks court OK of $5.3M in executive bonuses | LeveragedLoan.com

Interesting bankruptcy move by management:
Although not assuming liabilities for the company’s three defined benefit pension plans, the reorganization currently calls for $5.3 million in bonuses to be distributed to 9 top execs

Bankrupt Hawker Beechcraft seeks court OK of $5.3M in executive bonuses | LeveragedLoan.com
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Old 07-17-2012, 10:26 AM
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Often times there are strategic reasons for why a company facing big changes needs to retain certain leaders. These leaders are faced with the fact that they may very well be replaced if a new owner is in power. They have little incentive to stick with the company through the changes, at a time when their knowledge and experience with said company is more valuable than ever. Bonuses are one way to "convince" these execs to weather the storm, rather than jump ship.
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Old 07-17-2012, 11:48 AM
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$5.3M is couch cushion scraps compared to what the AMR execs will take away from that place once they're done running into the ground.
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Old 07-18-2012, 05:32 AM
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If there's little incentive for management to stay through the end of BK, then let them leave for "better" opportunities.

The fact they're in bankruptcy in the first place shows management failed miserably at their responsibilities.

However as said, $5.3M over 9 executives is a pittance for similar proceedings in the aviation world. That doesn't make it any easier for anybody who has lost their job or kept their job with a paycut to swallow, however...
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Old 07-18-2012, 05:48 AM
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Originally Posted by BoilerUP View Post

The fact they're in bankruptcy in the first place shows management failed miserably at their responsibilities.
Amen. Step 1 of Bankruptcy handbook should read, "Imbeciles that got us here - depart. As ASAP as possible..."
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Old 07-18-2012, 10:28 AM
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Originally Posted by bcaviator View Post
Often times there are strategic reasons for why a company facing big changes needs to retain certain leaders.
Rewarding failure.

The reward should be being able to continue to act an executive/CEO when the company emerges. If that's not enough, it's symptomatic of a much larger problem that won't be solved by rewarding the execs, it means there are fundamental problems with how they do business, the market, etc.
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