Utah aviation company reaches agreement with creditors
Groen Brothers Aviation Inc. said it has reached an agreement with creditors on a financial reorganization that will resolve the company's debt obligations, which exceed $170 million.
The Salt Lake City-based company will transfer substantially all of its assets, notably all of its technologies and associated patents into a new private entity to be formed by GBA, which is expected to be called Groen Brothers Aviation Corp. Creditors, in turn, have agreed to exchange most their debt instruments for a majority ownership of common stock in GBAC, which permits 4 percent of GBAC common stock to remain with the company.
GBAC will become the operating company engaged in the development of gyroplane and gyrodyne technology developed by GBA, company officials say. GBA will become a "non-operating" entity that will derive its revenue and value from its interest in GBAC, enabling GBA's common shareholders to retain a stake in the continued development of GBA technology.
"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," said company director Robin Wilson.
Groen Brothers Aviation Inc. has been developing gyroplane technology since 1986, powered by Rolls-Royce gas turbine engines. The company's Hawk 4 Gyroplane was used extensively for aerial security patrol missions during the 2002 Olympics in Salt Lake City.