JetDirect Puts Second Subsidiary Into Bankruptcy
JetDirect Aviation has now placed two of its subsidiary companies into bankruptcy. The first was Regal Jets of Dallas, placed into Chapter 11 bankruptcy on February 25.
On Friday, JetDirect placed Novato, Calif. charter operator Sunset Aviation, Inc. into Chapter 7 liquidation.
JetDirect Aviation had furloughed all Sunset Aviation, Inc. employees on March 2, then in a March 10 letter to those employees, JetDirect chairman Gregory Campbell explained, “As a result of this filing any wages or expense obligations owed to you will now be treated as an unsecured creditor obligation of the bankruptcy estate. All of the assets of Sunset Aviation were secured by Sovereign Bank, which will continue to possess a first lien holding. Because the bank and other secured creditors are owed substantially more than the likely proceeds of the liquidation of Sunset’s assets, it is likely there will not be sufficient proceeds available for distribution to the unsecured creditors.”
A JetDirect spokesman told AIN that the acquisition of JetDirect assets by Brantley Partners-backed JDA Acquisition Company (JDAAC) is still on track. According to a March 9 letter to a management client from a JetDirect v-p, owners are being encouraged to sign a consent document to assign the previous management agreement to JetDirect Acquisition. “Prior to close, we will provide you with a complete account reconciliation as well as JDAAC’s plan to repay any past operating funds and charter revenue owed to you, for those clients with charter aircraft,” the letter states. The letter doesn’t say whether owners who leave JetDirect or don’t sign the consent document will be repaid for charter revenues they are owed.
After the JDAAC purchase, now set to occur by March 31, the new company will be rebranded and segregated bank accounts will be established for each management client, to help customers “rebuild that trust” and ensure the JetDirect does not fall behind in payments again.
Meanwhile, Dan Drohan, who sold Sunset Aviation, Inc. to JetDirect, has formed a new company called Sunset Aviation, LLC and expects to receive a new Part 135 certificate within days. “In light of the news of the [Chapter 7] filing, we’re going to ramp up our efforts to rebrand the company,” he said. The new Sunset Aviation, LLC has 70 employees and 32 aircraft.