Hawker Beechcraft Moves Closer to Chapter 11 Emergence

Beechcraft King Air 350i

Key creditors overwhelmingly approve reorganization plan; Company obtains exit financing commitment

WICHITA, Kan. (Jan. 25, 2013) – Hawker Beechcraft, Inc. (Hawker Beechcraft) today announced the key creditors voting in the company’s solicitation process have overwhelmingly approved its proposed Joint Plan of Reorganization (Plan).

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The company also announced that J.P. Morgan Securities LLC and Credit Suisse Securities (USA) LLC have agreed to act as joint lead arrangers and joint bookrunners to structure, arrange and syndicate $600 million in exit financing, consisting of a term loan and a revolving line of credit. The affiliated banks of the joint lead arrangers, JPMorgan Chase Bank, N.A. and Credit Suisse AG, have committed to underwrite the financing. The financing will be used to repay all claims under the debtor-in-possession (DIP) post-petition credit facility, pay certain settlement and cure payments and fund ongoing operations. The financing is subject to, among other things, completion of definitive financing documentation and Bankruptcy Court approval.

Robert S. "Steve" Miller, CEO of Hawker Beechcraft, Inc., said, “The tremendous show of support of our creditors for the Plan, which will dramatically reduce Hawker Beechcraft’s debt load, and the financing commitment from JPMorgan and Credit Suisse mark an important milestone for the company as it moves closer to emerging from the restructuring process.”

Bill Boisture, Chairman of Hawker Beechcraft Corporation, said, “The reorganized Beechcraft Corporation will emerge from this process in a strong operational and financial position, with the working capital and flexibility to execute a strategy built around our core products like the world-renowned King Air twin engine turboprop and the T-6 military training aircraft, which will enable the company to compete well into the future.”

Hawker Beechcraft will seek approval from the Court to exit bankruptcy at the confirmation hearing scheduled for Jan. 31 and expects to emerge from Chapter 11 in the second half of February. Upon emergence, pre-petition secured bank debt, unsecured bond debt, and certain general unsecured claims will be canceled and holders of such claims will receive equity in the reorganized company in the percentages negotiated by the major creditor groups at the time the company commenced its Chapter 11 proceedings. A new Board of Directors, to be appointed by the new owners of the company, will take over on the date of emergence.

Hawker Beechcraft’s legal representative is Kirkland & Ellis LLP; its financial advisor is Perella Weinberg Partners LP; and its restructuring advisor is Alvarez & Marsal North America, LLC. The Ad Hoc Committee of Senior Secured Lenders’ legal representative is Wachtell Lipton Rosen & Katz. Credit Suisse serves as agent for the lenders under Hawker Beechcraft's secured pre-petition and debtor-in-possession credit facilities. Credit Suisse's legal representative is Sidley Austin LLP and its financial advisor is Houlihan Lokey. The Unsecured Creditors Committee’s legal representative is Akin Gump Strauss Hauer & Feld LLP and its financial advisor is FTI Consulting, Inc.

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