Northstar Aerospace Files for Bankruptcy in Delaware Due to Negative...
07/15/12
In June, Northstar Aerospace and various related entities (collectively, "Northstar") filed chapter 11 petitions for bankruptcy in the United States Bankruptcy Court for the District of Delaware. Northstar describes itself as a supplier of "components and assemblies for the commercial and military aerospace markets." The company also provides machining, repair and overhaul services for the aerospace industry. See Northstar's Declaration in Support of First Day Motions (the "Decl.") at *3. The company enters bankruptcy following a marketing process for the sale of its business. Id. By filing for bankruptcy, Northstar hopes to continue with operations while the company finds a buyer. Decl. at *4. A copy of Northstar's bankruptcy petition is available here for review. Click here to review a copy of Northstar's Declaration in Support of First Day Motions.
Northstar operates six production facilities in the U.S. and Canada, the largest of which is located in Bedford Park, Illinois. The Northstar U.S. Debtors include Northstar USA, Derlan USA Inc., Northstar Chicago and Northstar Phoenix. Besides the U.S. companies, Northstar also has a Canadian parent company and various Canadian affiliates. Decl. at *6. The Northstar U.S. and Canadian entities work together to provide products used in helicopters manufactured by Boeing (the Apache helicopter), Sikorsky (the Blackhawk helicopter) and AgustaWestland (the Wildcat helicopter), among others. Decl. at *7. Even though the company provides parts and services to several helicopter manufacturers, the majority of Northstar's revenue comes from is contracts with Boeing.
Northstar attributes part of its need for bankruptcy on a lack of cash. The company purchases metals and other raw materials from third party suppliers which must meet high standards set by Northstar customers. Northstar's materials can only be purchased from qualified suppliers, however, the qualification process for a supplier can be both lengthy and expensive. Decl. at *13. Recent announcements concerning Northstar's financial problems have led most of Northstar's suppliers to require cash in advance or at the time of delivery. Id.
Given that the Northstar bankruptcy was filed over a month ago, the Delaware Bankruptcy Court has had an opportunity to consider and rule on many of Northstar's initial motions. On July 3rd, the Bankruptcy Court entered the following orders:
07/03/2012
163
Order (FINAL) Granting Motion for Entry of Interim and Final Orders (I) Prohibiting Utility Companies From Altering, Refusing or Discontinuing Services to, or Discriminating Against, the Debtors and (II) Determining That the Utility Companies are Adequately Assured of Post-Petition Payment. (related document(s)6, 51) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
162
Order Granting Motion of the Debtors to File the Unredacted APA Under Seal. (Related Doc # 65) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
161
Order Authorizing and Approving Implementation of U.S. Employee Incentive Program. (Related Doc # 90) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
160
Order (FINAL) (I) Authorizing the US Debtors to Use Cash Collateral, (II) Authorizing the US Debtors to Obtain Postpetition Secured Financing, (III) Granting Certain Liens, (IV) Granting Adequate Protection and (V) Modifying the Automatic Stay. (related document(s)11, 18, 56) Order Signed on 7/3/2012. (Attachments: # 1 Exhibit A# 2 Exhibit B# 3 Exhibit C# 4 Exhibit D) (LCN) (Entered: 07/03/2012)
07/03/2012
159
Order Granting Application of the Debtors for Entry of an Order Authorizing Employment and Retention of Bayard, P.A. as Attorneys for the Debtors in Possession Nunc Pro Tunc to the Petition Date. (Related Doc # 73) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
158
Order Authorizing the Employment and Retention of Harris Williams LLC as Investment Banker for the Debtors and Debtors in Possession Effective Nunc Pro Tunc to the Petition Date and for a Waiver of Certain Timekeeping Informational Requirements. (Related Doc # 75) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
157
Order Extending Time for Debtors to File Their Schedules and Statement of Financial Affairs. (Related Doc # 10) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
156
Order Granting Motion of the Debtors for Order Authorizing Procedures for Interim Compensation and Reimbursement of Expenses of Professionals. (related document(s)69) Order Signed on 7/3/2012. (Attachments: # 1 Exhibit A) (LCN) (Entered: 07/03/2012)
07/03/2012
155
Order Authorizing the Employment and Retention of SNR Denton US LLP as Attorneys for the Debtors and Debtors in Possession Effective Nunc Pro Tunc to the Petition Date. (Related Doc # 72) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
154
Minutes of Hearing held on: 07/03/2012
Subject: Second Day Motions.
(vCal Hearing ID (153212)). (JAF) Additional attachment(s) added on 7/3/2012 (JAF). (Entered: 07/03/2012)
07/03/2012
153
Order Authorizing: (I) Payment of Prepetition Obligations Incurred in the Ordinary Course of Business in Connection With Workers Compensation, Liability, Property, and Other Insurance Programs, Including Payment of Policy Premiums; and (II) Continuation of Insurance Premium Financing (Related Doc # 76) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
152
Order Authorizing the Debtors' to Employ and Compensate Certain Professionals in the Ordinary Course of Business. (Related Doc # 74) Order Signed on 7/3/2012. (Attachments: # 1 Exhibit 1# 2 Exhibit 2) (LCN) (Entered: 07/03/2012)
07/03/2012
151
Order Granting Application of the Debtors for an Order Authorizing and Approving the Employment and Retention of Logan & Company, Inc. as Administrative Advisor for the Debtors Nunc Pro Tunc to the Petition Date.(related document(s)70) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
07/03/2012
150
Order (FINAL) (I) Authorizing Continued Maintenance of Existing Bank Accounts; (II) Authorizing Continued Use of Existing Cash Management System; (III) According Administrative Expense Status for Intercompany Claims; (IV) Authorizing Continued Use of Existing Checks and Business Forms; (V) Authorizing Closure of Any Unnecessary Bank Accounts, and (VI) Waiving on an Interim Basis the Requirements of Section 345(B) of the Bankruptcy Code. (related document(s)4) Order Signed on 7/3/2012. (LCN) (Entered: 07/03/2012)
The Northstar bankruptcy is before Judge Peter J. Walsh. Northstar is represented by the Delaware law firm, Bayard P.A.
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Jason Cornell is a bankruptcy attorney with the law firm Fox Rothschild LLP. Jason practices before the United States Bankruptcy Court for the District of Delaware. You can contact Jason at [email protected] or at 302 252 5833. For readers seeking more information concerning Delaware bankruptcy proceedings, below are posts covering various bankruptcy-related issues:
Ten Things Every Commercial Landlord Should Know About a Tenant in Bankruptcy.
Seeking Relief from the Automatic Stay in Delaware.
A Tale of Two Bankruptcy Auctions.
What Information is Required in a Chapter 11 Disclosure Statement?