The bankrupt Air Force One supplier GDC Technics LLC has won court approval to borrow up to $800,000 in emergency financing and use cash pledged as collateral, despite objections by the company’s former partner Boeing Co., WSJ Pro Bankruptcy reported. Judge Craig A. Gargotta of the U.S. Bankruptcy Court in San Antonio said during a hearing on Friday that he would sign an order authorizing GDC to access up to an additional $300,000 in bankruptcy financing from MAZAV Management LLC, an indirect owner of GDC through GDC’s parent Oriole Aviation LLC. That is up from the initial $500,000 that GDC got approval to start using earlier this month. It is GDC’s “intent not to borrow any more money than absolutely needed,” the company’s bankruptcy lawyer Jason Rudd said during the hearing. Deborah Kovsky-Apap, a lawyer for the committee representing unsecured creditors, had objected during the hearing to the financing proposal because the lender’s junior liens on assets would be elevated to first priority, improving its position over the unsecured creditors. However, the judge overruled the objection. Judge Gargotta also allowed the Fort Worth, Texas-based aircraft modification and technology company to continue using cash collateral from senior lender GDC Investco LLC, one of four equity owners of GDC’s parent Oriole Aviation. GDC’s largest unsecured creditor, Boeing, had objected to the use of the cash collateral because the motion contained releases that would eliminate claims against corporate insiders before creditors could investigate potential claims. Boeing argued that it was inappropriate to grant broad releases to the equity owners and GDC’s directors and officers. Chicago-based Boeing has claims of about $6.7 million against GDC, including loans to the company, which worked on government executive fleets.
