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Gyroplanes Builder, Groen Brothers Aviation Reaches Agreement With
Creditors By Bill Goldston |
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May 2, 2012 - Groen Brothers Aviation (GBA) announced
that it has reached an agreement with its creditors for
a major financial reorganization of the Company. The
restructuring will result in the elimination of all of
the Company's debt obligations, which currently exceed
$170 million.
GBA is a U.S. corporation that designs vertical takeoff
and landing (VTOL) rotorwing gyroplanes and gyrodynes.
GBA's vertical lift rotorcraft technologies enable
aircraft to be runway-independent and not constrained by
physics-imposed speed, range, and payload limitations of
a helicopter.
In this transaction, GBA will transfer substantially all
of its assets, notably all of its technologies,
know-how, and associated patents into a new private
entity to be formed by GBA, which is expected to be
called "Groen Brothers Aviation Corporation" (GBAC).
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Complementing this action by GBA, these creditors have agreed to
exchange essentially all of their debt instruments for a
majority ownership of common stock in GBAC which permits
ownership of 4% of GBAC common stock to remain with GBA.
Robin Wilson, Company Director for the past four years, stated,
"We are very fortunate to have creditors who believe in moving
GBA technology development forward, instead of requiring a
liquidation of assets as has been commonly witnessed in the
aviation industry over the past five years."
David Groen, the Company's Founder and CEO for the past
twenty-two years, stated, "The worldwide economic contraction
over the past five years has been devastating for countless
companies. These events caused us to lose our coveted position
as lead contractor in a significant DARPA contract, which
negatively impacted interest in GBA from the equity markets.
Despite the difficult financial challenges we faced during this
period, we have been fortunate to have creditors who understand
and believe in the GBA vision: worldwide use of GBA's sustained
autorotative flight technologies.
?The Company does not have, nor has it had, the hundreds of
millions of dollars which our vision requires in order to be
achieved. Through our creditors, the GBA vision and products may
now be realized, and our common shareholders will have an
interest in GBAC. With the substantial investment that is
anticipated to be applied to advanced technology development, we
believe GBA could still achieve considerable asset appreciation
in the future." |