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Wed, Jun 02, 2004

Mooney Completes Stock Sale

Says Deal Strengthens Airplane Manufacturer

In a move apparently triggered by pressure from creditors, Mooney Aerospace Group announced Tuesday that it has sold all of the stock of Mooney Airplane Company to Allen Holding Finance Ltd., a private investment company. As part of the transaction in consideration for the stock, Allen agreed to assume all of the debt owed by MASG to its secured debenture holders, an amount in excess of $21 million, and invest $4 million in new capital for Mooney Airplane Company by July 27, 2004.

According to J. Nelson Happy, MASG President and Board Vice-Chairman, "The company's secured debenture holders declared their notes in default. As a result, the MASG board accepted the offer to purchase all of Mooney Airplane Company's stock by Allen, and the sale was completed last Friday morning."

Because of the stock sale, MASG no longer has any financial interest in Mooney Airplane Company.

"The board of MASG deeply regrets that the sale of Mooney Airplane Company's stock was made necessary," Happy said. "However, Allen has assumed over $21 million of the Company's debt owed to the secured debenture holders, and has also agreed to provide $4 million of new capital for the operating company within 30 days. This is good news for Mooney Airplane Company, which will now have adequate capital to meet its business plan," according to Happy.

Mooney Airplane's Take

"We are delighted that our new owner has made provision for providing $4 million in new capital for the company," said Mooney Airplane Company's Chief Operating Officer Barry Hodkin. "This will allow us to achieve our business plan, and should remove all doubts about Mooney's financial stability. I am pleased that our sales and marketing efforts resulted in the sale of four new airplanes in May, and we are anticipating an outstanding year for the sale of all of our aircraft models. I want to particularly recognize the efforts of our new Vice President of Sales and Marketing, David Copeland, who has done a remarkable job of jump-starting our sales effort."

Hodkin said in a news release to ANN, "We have had a tremendous reception of our new GX models, the Bravo GX and the Ovation2 GX, both of which incorporate the remarkable Garmin G-1000 glass panel display. We anticipate FAA certification of both aircraft in August, and we will have them on display at our booth in Oshkosh in July. We have also had brisk sales of our conventionally instrumented airplanes, the Bravo DX and the Ovation2 DX. We are, I believe, the only manufacturer that has kept both types of instrument displays available. Pilots can make their own decision about what technology they want in their new Mooney."

Mooney Airplane Company's board of directors recently adopted an aggressive business plan that it says will assure the long-term success and profitability of the company. Hodkin said, "Allen Holding has committed sufficient working capital to fund our new business plan, and we look forward to working with our new parent to achieve our business objectives. We put our customers first, and we will now have the financial security that we need to serve them well and to assure Mooney's long term success."

Hodkin also said, "We have been ramping up our workforce of highly skilled craftsman. We have been fortunate to add more than 20 new employees during the past three weeks, and we now employ over 200 people. We are planning to add more employees to our direct work force as required to meet our new plane orders."

FMI: www.mooney.com

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