New Mexico-based One Aviation made an 11th-hour appeal this week to remain in operation at the Albuquerque International Sunport (ABQ) as executives endeavor to restructure the company with greater emphasis on the production and servicing of Eclipse very light jets, documents obtained by AIN reveal.
On April 26, the city of Albuquerque served One Aviation and partner company Eclipse Aerospace with an order to vacate its facilities at ABQ by May 8 unless the company paid more than $895,000 in rent and utilities dating back to November. Eclipse has continued with maintenance and training operations at ABQ past that deadline.
On May 8, COO Kevin Gould wrote the city that One Aviation would make two payments, totaling $161,829.84, and further requested a reimbursement agreement with the city for the remaining balance owed, "as we take the company through a restructuring process."
The company made good on those two payments, but on May 16 the city attorney's office refused One Aviation’s request for additional financial accommodations and served the company with a three-day notice of eviction from all facilities at ABQ. Terms of the earlier order also require the surrender of an experimental Eclipse 500 prototype that is now flying as a testbed for the planned Eclipse 700’s larger wing.
New Investors, Restructuring Under Way
This may not be the end of Eclipse's time in Albuquerque, however. Following a meeting between the two sides, One Aviation chairman Mike Wyse responded to the eviction order with a promise of "immediate payment" of all monies owed, now totaling approximately $790,000, and a request to iron out a new lease agreement that would see the company relinquish its paint and production facilities at ABQ while continuing operations from a remaining hangar.
"We are working diligently to resolve the company's financial challenges so that we may meet our rent and other ongoing commitments," Wyse wrote. "To that end we have acquired new investors who want to stabilize our core business, which is providing maintenance, upgrades, and parts to the current global fleet of 286 Eclipse airplanes.”
Wyse further noted those as-yet undisclosed investors "want to grow the business by restarting production of the EA550" that was halted last year, as well as developing "new models of aircraft such as the EA700," and requested a May 17 meeting with the city to discuss the proposal.
Gould would not comment Thursday afternoon if that meeting had been scheduled or had already taken place. The city's attorney for ABQ also declined comment to AIN at press time, and messages to Wyse and One Aviation CEO Alan Klapmeier—the latter of whom is not named in any of the documents pertaining to the situation at ABQ—have not yet been returned.
One Aviation cited ongoing restructuring efforts and new investment in a recent appeal to the city of Albuquerque, New Mexico, to allow the company to remain in operation at the Albuquerque International Sunport (ABQ.)
Albuquerque has been home to the very light jet manufacturer since the original company, Eclipse Aviation, moved to the city in 2000. That company’s assets were purchased out of bankruptcy in 2009 by Eclipse Aerospace, which in turn merged with Kestrel Aircraft to form One Aviation in March 2015.
Since that time, the company has maintained cash flow primarily through maintenance and training to support existing Eclipse aircraft. One Aviation announced plans last year for a larger Eclipse 700 variant but also acknowledged it would need a capital infusion to bring that aircraft to market.
Further complicating matters is the situation at Kestrel, which was evicted from its headquarters in Brunswick, Maine, last year over nonpayment of rent. The company also faces possible legal action by Wisconsin state officials over delinquent state, county, and local loan payments made since 2012 to support intended production of the K350 turboprop single. Development on that aircraft effectively stopped last year as One Aviation shifted focus to Eclipse manufacturing and support.
Company Served Eviction Notices in Albuquerque
Following two rounds of layoffs in 2017, ending production of new-build Eclipse 550 jets and other efforts to streamline operations in Albuquerque, on April 26 the city attorney’s office served One Aviation and Eclipse Aerospace with an order to vacate several Eclipse-held facilities at ABQ by May 8.
According to documents obtained by AIN, to avoid eviction One Aviation would need to reimburse the city more than $895,000 in back rent, utilities, and prior default obligations dating back to November. Nonpayment would also force the company to surrender one of the original Eclipse 500 prototypes, identified as N503EA, which is now flying as N990NE fitted with the larger wing intended for the EA700.
Eclipse continued with maintenance and training operations at ABQ past that deadline, however, with COO Kevin Gould submitting a written proposal to the city on May 8 stipulating two immediate payments against the outstanding balance, and requesting a reimbursement agreement for remaining monies owed, "as we take the company through a restructuring process."
The company made good on payments totaling approximately $161,800, but on May 16 the city attorney's office refused Eclipse's request for additional financial accommodations and served the company with a three-day notice of eviction from all facilities at ABQ. One Aviation chairman Mike Wyse responded with an appeal to stay at ABQ, a promise of "immediate payment" of all past due amounts—now totaling approximately $790,000—and a request for a new lease agreement that would see the company relinquish all but one of its current facilities at ABQ.
"We are working diligently to resolve the company's financial challenges so that we may meet our rent and other ongoing commitments," wrote Wyse. "To that end, we have acquired new investors who want to stabilize our core business which is providing maintenance, upgrades, and parts to the current global fleet of 286 Eclipse airplanes."
Wyse requested a May 17 meeting with the city to discuss the proposal, adding the as-yet-undisclosed investors "want to grow the business by restarting production of the EA550" that halted last year, as well as bring “new models of aircraft such as the EA700” to market.
While details of any such meeting are scarce, all appeared business as usual at the ABQ facilities as of May 21. Calls to One Aviation representatives and the city's attorney for ABQ regarding the company’s proposal were not returned before AIN's print deadline.
Executives Familiar with Restructuring 'Distressed' Companies
Further hinting at the company’s evolving situation and probable financial course, Wyse serves as managing partner of New York-based Wyse Advisors, LLC that bills itself as a "boutique financial advisory firm with a primary focus on stressed, distressed, and special situations." Gould notes his experience working in “distressed/high-change environments: turnarounds, startups, restarts" on social media.
Also of note, One Aviation CEO Alan Klapmeier is not named in the recent documents pertaining to operations in Albuquerque. Klapmeier previously served as CEO of Kestrel and has been the most visible spokesman for the merged company.
Meanwhile, the company is proceeding with efforts to open a Chicago-area maintenance, repair, and overhaul facility at Aurora Municipal Airport (ARR) by June 4. The Aurora service center replaces the company’s longstanding MRO operation at Chicago Executive Airport (PWK) for which One Aviation entered into a voluntary lease surrender agreement with airport officials in April.