Just one day after filing Chapter 11 bankruptcy last Tuesday, a group of investors, including European distributor Etirc Aviation, received court approval to provide interim financing to keep the very light jet manufacturer open and its 954 employees working. The financing is intended to ensure Eclipse Aviation is a viable entity when its assets go up for public auction next month.
Chapter 11, Title 11, United States Code
Just days after Eclipse Aviation achieved two key milestones–EASA and Avio NG 1.5 certification–the pioneering VLJ manufacturer this morning filed for Chapter 11 protection in U.S. Bankruptcy Court in Delaware. At the same time, Eclipse Aviation entered into an agreement to sell “substantially all of its assets” to an affiliate of Etirc Aviation of Luxembourg.
Tyler Jet Aircraft Sales, hit hard by the downturn in the economy last year and the aftermath of September 11, is expected to emerge from reorganizing under Chapter 11 bankruptcy proceedings within the next 60 days, according to v-p and general manager Orville Winover. Tyler Jet Aircraft Sales was forced into Chapter 7 in February, but in March the bankruptcy court granted Tyler’s motion to put the case under Chapter 11.
VisionAire, now operating under Chapter 11 bankruptcy, is focusing its efforts on obtaining additional funding. “We’re continuing discussion with several different sources,” said a spokesman, “two of which are European investment syndications.” In August, VisionAire was forced into Chapter 7 involuntary liquidation by a group of five creditors, including two former members of its board of directors.
HAS Corp, the Dallas and Mount Pleasant, Pa.-based helicopter resale and completions center, has filed for Chapter 11 bankruptcy protection. A leading U.S. EMS and police helicopter customization house, HAS said it has become the victim of adverse business conditions and has filed Chapter 11.
US Airways’ decision to file for Chapter 11 bankruptcy last month officially placed the courts at the center of a restructuring exercise in which the development of the airline’s regional network has emerged as perhaps the most crucial component.
As companies merge, expand, downsize, change top executives or declare bankruptcy, their flight departments are often significantly affected. In the past several weeks, four major companies with flight departments have filed for protection under Chapter 11. More than 20 corporate jets were operated by these four companies, and none is currently more visible than Enron.
Aspen, Colo.-based AEXjet ceased operations for two weeks last month while the transactions for entering into a “business combination” with an unidentified operator were finalized. The charter company voluntarily filed for Chapter 11 bankruptcy protection on September 14, and CEO John Gallaher released a statement at that time assuring customers and employees that operations would continue.
An 11th-hour effort on January 31 failed to keep OEM startup VisionAire afloat after a federal district court judge placed the company back into Chapter 7 bankruptcy on January 21. The company had been operating under Chapter 11 bankruptcy since September, when the judge agreed to the voluntary insolvency after five creditors petitioned the court to place VisionAire into involuntary Chapter 7 bankruptcy in July.
Mesaba Airlines expected to exit bankruptcy during the last week of April, following the approval of its reorganization plan by U.S. Bankruptcy Judge Gregory Kishel. The Minneapolis-based Northwest Airlines affiliate filed for Chapter 11 bankruptcy in October 2005, a month after the major airline itself filed for Chapter 11 and defaulted on its service contract payments to Mesaba.