Details of the A123 Systems bankruptcy proceedings are getting ironed out, and have been given the green light by US Bankruptcy Judge Kevin Carey. The federal judge approved an outline of lithium ion battery maker A123's liquidation plan to be used by creditors, who will decide whether to vote for or against the repayment plan.

The next hearing will be on April 30, where A123 Systems will seek court approval of the plan to sell nearly all its assets. The bankruptcy process has been moving forward in recent months; in January, A123 received court approval to sell the majority of its assets to Chinese auto parts maker Wanxiang Group Co.'s US division. Wanxiang America Corp. paid about $256.6 million to acquire nearly all of A123's automotive, grid and commercial business assets. That deal received backing from the Committee on Foreign Investment in the US (CFIUS) on January 29. CFIUS entered the picture to allay fears expressed by members of Congress over national security issues from allowing the sale of federal grant-backed A123 to a Chinese company.

Fisker Automotive still claims A123 owes the luxury plug-in hybrid maker about $140 million.

A123 Systems' court filing said that general unsecured creditors are projected to recover about 32.7 percent of what they're owed. That's bound to not go over well with its primary customer, Fisker Automotive, which claims A123 owes the luxury plug-in hybrid maker about $140 million from its supply agreement and breach of warranty claims. Fisker has its hands full now dealing with its own problems, like finding its own Chinese investor (now unlikely to be Zhejiang Geely Holding Group) and dealing its co-founder Henrik Fisker walking away.

The settlements could later be more satisfactory to debtors and noteholders; if objections to claims are successful, A123 estimates the percentage recovery for general unsecured creditors to be 63.6 percent. Unsecured subordinated noteholders would get a 62.9 percent recovery if the claims objections are accepted by the court, as opposed to the current estimate of a 31.3 percent recovery. Unsecured senior noteholders are expected to be paid in full, though details on the settlement will have to wait until the federal bankruptcy court's decision after the April 30 hearing.