Bankruptcy Court Petition Lists "Hundreds" Of Creditors
ANN REALTIME REPORTING 02.19.08 1430 EST:
Aero-News has learned Adam Aircraft has filed for Chapter 7
liquidation, effectively dashing hopes the company would manage an
11th-hour funding miracle and continue operations.
"In the absence of additional funding for the company to
continue operations, it is ... in the best interest of the company,
its creditors, shareholders and other interested parties" to file
Chapter 7, the company said in a court filing, according to the
Denver Business Journal.
The Denver Post reports
the petition was filed last Friday in US Bankruptcy Court in
Colorado, and includes "hundreds" of creditors -- including company
founder George F. "Rick" Adam, Jeppesen Sanderson, several city and
state offices and utilities throughout Colorado and Utah, and
Denver's "Wings Over The Rockies" Air and Space Museum.
Also listed as creditors are those who had taken delivery of
Adam's A500 twin piston aircraft -- including Mike Leahy, who took
delivery of the first A500, and the New Mexico State Patrol, which
took delivery of the last A500 shortly before the company announced
it was in serious financial trouble.
As ANN reported last week,
Adam shut down ALL operations February 11, and laid off its
remaining workers... but held open the possibility of a last-minute
bailout, with an Adam spokesperson calling rumors of an impending
bankruptcy filing "premature."
Sadly, that hope proved overly-optimistic... and the last
Adam official, CEO John D. Wolf, tendered his resignation effective
February 15.
Hints of significant problems at Adam came to light in
January, with the company's annoucement of the layoffs of close to
300 workers, and the suspension of the planemaker's operations in
Utah. At the time, the company cited the need to overcome past
issues with the certification of its A700 very light jet, and
obtain capital to see that program through to TC, as reasons for
the decision.
One week later, details of a January 15 letter to
stockholders from Wolf came to light, outlining
the company's financial issues. The letter stated the company's
future hinged on completion of two successful financing
transactions, the first of which called for Adam to raise $30.5
million by the end of January. The company reportedly secured $5.5
million of that in late December... but follow-up funding never
materialized.
The company delivered approximately seven A500s to
customers.